UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2011
OR
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Commission file number 000-53224

CHINA PROSPEROUS CLEAN ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

Nevada

(State or other jurisdiction of incorporation or organization)

West Side, Public Transportation Gas Filling Center,

Angang Avenue-Middle Part, Yindu District,

Anyang, Henan Province,

Postal code: 455000

The People’s Republic of China

(Address of principal executive offices, including zip code.)

86-372-3166864

(telephone number, including area code)

Copy of Communication to:

Bernard & Yam, LLP

Attention: Bin Zhou, Esq.

401 Broadway Suite 1708

New York, NY 10013

Phone: 212-219-7783

Facsimile: 212-219-3604

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 last 90 days. YES x NO ¨

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

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x

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

YES ¨ NO x

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 125,000 as of May 12, 2011.

On this Form 10Q quarterly report, the registrant, China Prosperous Clean Energy Corporation, is hereinafter referred as "we", or "Company", or "CHPC".

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CHINA PROSPEROUS CLEAN ENERGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2011 AND 2010

Table of Contents

Consolidated Financial Statements	Page
Report of Independent Registered Public Accounting Firm	3
Consolidated Balance Sheets	4
Consolidated Statements of Income and Comprehensive Income	5
Consolidated Statements of Comprehensive Income	6
Consolidated Statements of Cash Flows	7
Notes to Consolidated Financial Statements	8

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders

China Prosperous Clean Energy Corporation and Subsidiaries

We have reviewed the accompanying consolidated balance sheet of China Prosperous Clean Energy Corporation (the “Company”) as of March 31, 2011, and the related consolidated statements of operations, consolidated statements of comprehensive income, and consolidated statements of cash flows for the three months ended March 31, 2011 and 2010. These consolidated financial statements are the responsibility of the Company’s management.

We conducted our reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with auditing standards of the Public Company Accounting Oversight Board (United States), the balance sheet of China Prosperous Clean Energy Corporation as of December 31, 2010, and the related consolidated statements of operations and comprehensive income, stockholders’ equity and cash flows for the year then ended (not presented herein); and in our report dated April 11, 2011, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2010, is fairly stated, in all material respects, in relation to the balance sheet from which it has been derived.

/s/ Partizio & Zhao, LLC

Parsippany, New Jersey

May 12, 2011

China Prosperous Clean Energy Corporation and Subsidiaries

Consolidated Balance Sheets

	March 31,		December 31,
	2011		2010
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	2,374,454	$	3,806,939
Restricted cash		1,070,259		304,540
Accounts receivable		481,200		541,809
Inventories		959,440		1,020,912
Advance payments		8,850,819		9,363,683
Loans to third parties		4,618,392		3,224,210
Dividend receivable		611,929		524,400
Other current assets		878,631		986,519
Total current assets		19,845,124		19,773,012

Property and equipment, net		5,684,778		4,731,838

Other assets:
Advance payments-non current		3,488,386		3,465,541
Deferred income taxes		52,458		52,114
Goodwill		62,798		62,386
Investment in non-consolidated entity		9,445,807		9,383,948
Other non-current assets		37,124		34,371
Total other assets		13,086,573		12,998,360

Total assets	$	38,616,475	$	37,503,210

Liabilities
Current liabilities:
Accounts payable and accrued expenses		1,299,986	$	1,523,027
Short-term bank loans		1,527,000		1,517,000
Trade notes payable		2,137,800		606,800
Customer advances		1,215,765		1,222,234
Current maturities of capital lease obligations		127,114		-
Due to former shareholders		1,645,284		1,634,509
Income taxes payable		71,691		178,643
Loans from third parties		18,142,092		18,873,908
Other current liabilities		714,281		611,054
Total current liabilities		26,881,013		26,167,175

Long- term capital lease obligations		232,856		-

Total liabilities		27,113,869		26,167,175

Equity
Stockholders’ equity:
Common stock, $0.001 par value, 75,000,000 shares authorized,		125		125
125,000 and 120,000 shares issued and outstanding at
March 31, 2011 and December 31, 2010. respectively
Additional paid-in capital		8,105,257		8,105,257
Retained earnings		2,172,243		2,162,039
Statutory reserve		283,119		283,119
Accumulated other comprehensive income		929,740		773,166
Total stockholders’ equity		11,490,484		11,323,706

Noncontrolling interest		12,122		12,329

Total equity		11,502,606		11,336,035

Total liabilities and equity	$	38,616,475	$	37,503,210

The accompanying notes are an integral part of these consolidated financial statements.

China Prosperous Clean Energy Corporation and Subsidiaries

Consolidated Statements of Income and Comprehensive Income (Loss) (Unaudited)

	For The Three Months Ended March 31,
	2011			2010

Sales	$	9,278,961		$	4,672,996

Cost of sales		8,257,567			3,979,668

Gross profit		1,021,394			693,328

Operating expenses:
Selling expenses		740,401			420,150
General and administrative expenses		306,645			181,605
Total operating expenses		1,047,046			601,755

Income (loss) from operations		(25,652	)		91,573

Other income (expenses):
Investment income		83,490			78,421
Interest expense		(34,062	)		(32,013	)
Other income (expenses)		1,468			(96,162	)
Total other income (expenses)		50,896			(49,754	)

Income before provision for income taxes		25,244			41,819

Provision for income taxes		18,515			18,706

Net income		6,729			23,113

Less: Net loss attributable to non-controlling interest		(3,475	)		(62	)

Net income attributable to CHPC	$	10,204		$	23,175

Weighted average number of shares
Basic and diluted		125,000			120,000

Earnings per share
Basic and diluted	$	0.08		$	0.19

The accompanying notes are an integral part of these consolidated financial statements.

China Prosperous Clean Energy Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(Unaudited)

	For the Three Months Ended
	March 31,
	2011		2010

Net income	$	6,729	$	23,113

Other comprehensive income
Foreign currency translation adjustment		159,842		9

Total other comprehensive income		159,842		9

Total Comprehensive income		166,571		23,122

Less: Comprehensive income attributable to the noncontrolling interest		3,268		-

Comprehensive income attributable to CHPC	$	163,303	$	23,122

The accompanying notes are an integral part of these consolidated financial statements.

China Prosperous Clean Energy Corporation and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)

	For the Three Months Ended March 31,
	2011			2010

Cash flows from operating activities:
Net income	$	6,729		$	23,113
Adjustments to reconcile net income to cash provided by
(used in) operating activities:
Depreciation		43,269			17,900
Share-based payments		12,501			-
Changes in assets and liabilities:
Accounts receivable		63,961			68,367
Inventories		67,970			(179,563	)
Advance payments		572,632			1,126,723
Dividend receivable		(83,786	)		(78,421	)
Other current assets		111,208			(1,416,140	)
Other non-current assets		(2,518	)		909
Accounts payable and accrued expenses		(232,287	)		381,469
Trade notes payable		1,521,800			-
Customer advances		(14,477	)		413,134
Other current liabilities		(32,535	)		44,402
Total adjustments		2,027,738			378,780

Net cash provided by operating activities		2,034,467			401,893

Cash flows from investing activities:
Acquisition of property and equipment		(961,878	)		(47,790	)
Advance payments for purchase of fixed assets		-			(786,166	)
Loans to third parties		(1,378,218	)		-
Investment in non-consolidated entities		-			(8,579	)
Net cash used in investing activities		(2,340,096	)		(842,535	)

Cash flows from financing activities:
Restricted cash		(765,719	)		840
Repayment of short-term bank loan		-			(439,950	)
Proceeds from (Repayment of) third party loans		(829,683	)		1,101,831
Capital lease obligations		358,744			-
Repayment of loan-term loan		-			(146,650	)
Net cash provided by (used in) financing activities		(1,236,658	)		516,071

Effect of foreign currency translation on cash		109,802			26

Net increase (decrease) in cash and cash equivalents		(1,432,485	)		74,615

Cash and cash equivalents – beginning		3,806,939			694,620

Cash and cash equivalents – ending	$	2,374,454		$	770,075

Supplemental schedule of non cash activities
Advance payments for investment in non-consolidated entity	$	-		$	5,480,311

The accompanying notes are an integral part of these consolidated financial statements.

China Prosperous Clean Energy Corporation and Subsidiaries

Notes to Consolidated Financial Statements

September 30, 2010 and 2009

(Unaudited)

Note 1 – Organization and Description of Business

China Prosperous Clean Energy Corporation (the "Company" or “CHPC”) was incorporated in the State of Nevada on March 24, 2006. On June 30, 2008, the Company entered a share exchange agreement ("Share Exchange Agreement”) under which the Company issued 5,865,000 shares of its common stock, par value $ 0.00001, to Oracular Dragon Capital Company, Ltd (“Oracular Dragon”), the sole shareholder of Origin Orbit Green Resource Company, Ltd (“Origin Orbit”) in exchange for all the issued and outstanding shares of Origin Orbit (the “Share Exchange”). The Share Exchange is the final part of a series of consecutive transactions including the stock purchase transactions consummated on June 19, 2008 in which the sole shareholder of Origin Orbit purchased 4,524,231 shares of common stock of CHPC from the affiliate and non-affiliate shareholders of CHPC at a total consideration of $ 346,586 (the “Stock Purchase”). Immediately following the Share Exchange and Stock Purchase, Oracular Dragon owned 10,389,231 shares of the common stock of CHPC, representing approximately 86.6% of CHPC’s total issued and outstanding share capital. As a result, the Share Exchange has been accounted for as a reverse acquisition using the purchase method of accounting, whereby Origin Orbit is deemed to be the accounting acquirer and CHPC to be the accounting acquiree. The financial statements before the date of Share Exchange are those of Origin Orbit with the results of CHPC being condensed consolidated from the date of Share Exchange. No goodwill has been recorded.

Origin Orbit is a holding company that, on April 4, 2007, acquired 100% of the capital stock of Anyang Prosperous Energy Technology Developing Co., Ltd. (“Anyang Prosperous”) and Anyang Top Energy Green Resources Co., Ltd. (“Anyang Top”), both of which were organized under the laws of the People’s Republic of China (“PRC”). Anyang Top does not have any subsidiary. Anyang Prosperous has various ownership interests in a number of companies in PRC.

As a result of these share exchange transaction and acquisitions, CHPC has become the holding company of the group comprising Origin Orbit, Anyang Prosperous and Anyang Top and their subsidiaries. The Company is principally engaged in the wholesale and retail sales of compressed natural gas and liquefied petroleum gas through its subsidiaries in the People’s Republic of China (“PRC” or “China”).

As of March 31, 2011, details of the subsidiaries of the Company are as follows:

	Place of	Registered and	Percentage of
Subsidiaries’ names	operation	paid-up capital	effective ownership	Principal activities

Origin Orbit Green Resource Company, Ltd (Origin Orbit”)	British Virgin Islands	US$7,950,000	100% (a)	Holding company of the other subsidiaries

Anyang Prosperous Energy Technology Developing Co., Ltd. (Anyang Prosperous”)	PRC	US$5,000,000	100% (b)	Wholesale and retail sales of compressed natural gas and liquefied petroleum gas(LPG”)

Anyang Top Energy Green Resources Co., Ltd. (Anyang Top”)	PRC	US$2,500,000	100% (b)	Wholesale of compressed natural gas, liquefied petroleum gas and Dimethyl Ether

Jinan Zhenyuan Green Resource Co. Ltd. (Jinan Green Resource”)	PRC	RMB10,000,000	99% (c)	Sales of LPG for domestic and vehicles usage and related vehicles components

Note 1 – Organization and Description of Business (continued)

	Place of	Registered and	Percentage of
Subsidiaries’ names	operation	paid-up capital	effective ownership	Principal activities

Henan Prosperous Clean Energy Corporation	PRC	RMB30,000,000	100%(c)	Investing in and constructing gas filling stations and selling compressed natural gas ("CNG"), liquefied petroleum gas ("LPG"), coal-bed methane, dimethyl ether ("DME") and methane.

Handan City Prosperous Car-used Green Resource Co. Ltd. (Handan Green Resource”)	PRC	RMB750,000	98% (c)	Sales of LPG, vehicles components, and new energy research and development

Weifang Prosperous Energy Technology Development Co. Ltd. (Weifang Prosperous”)	PRC	RMB10,000,000	100% (c)	Energy technology research and development, and sales vehicles components and gas equipment

Hengshui Prosperous Energy Technology Development Co. Ltd. (Hengshui Prosperous”)	PRC	RMB2,000,000	100% (c)	Gas energy technology research and development

Heze Prosperous Energy Technology Development Co. Ltd. (Heze Prosperous”)	PRC	RMB5,000,000	100% (c)	Construction of LPG and CNG station, and sales of vehicle components LPG and CNG

Shijiazhuang Prosperous Energy Technology Development Co. Ltd. (Shijiazhuang Prosperous”)	PRC	RMB10,000,000	100% (c)	Gas energy technology research, development and advisory services, and sales of gas energy product

Xuchang Zhenyuan Green Resource Technology Development Co. Ltd. (Xuchang Zhenyuan”)	PRC	RMB10,000,000	100% (c)	Investment in natural gas business

Yantai Prosperous Energy Technology Development Co. Ltd. (Yantai Prosperous”)	PRC	RMB500,000	100% (c)	Gas energy technology research and development, and sales vehicle components and gas energy equipment

Note 1 – Organization and Description of Business (continued)

	Place of	Registered and	Percentage of
Subsidiaries’ names	operation	paid-up capital	effective ownership	Principal activities

Changzhi City Zhenyuan Energy Technology Development Co. Ltd (Changzhi City”)	PRC	RMB4,400,000	100% (c)	Sales of crude oil, natural gas, LPG and related vehicle components, and construction of gas stations

Jiaozuo City Prosperous Energy Technology Development Co. Ltd. (Jiaozuo City”)	PRC	RMB5,000,000	100% (c)	Sales of natural gas, liquefied petroleum gas and vehicle components, construction and operation of gas stations

Pingdingshan City Zhenyuan Energy Technology Developing Co. Ltd. (Pingdingshan City”)	PRC	RMB5,000,000	100% (c)	Energy technology development, sales of natural gas, LPG and vehicle components, and construction and operation of gas stations

Linying Prosperous Energy Technology Development Co. Ltd. (Linyi Prosperous”)	PRC	RMB10,000,000	100% (c)	Sales of natural gas and vehicle components.

Jiangsu Hengrun Clean Energy Co., Ltd. ("Jiangsu Hengrun ")	PRC	RMB20,000,000	100% (c)	Research and development of clean energy technology, promotion and application of clean energy technology.

Notes:

(a) Held directly by CHPC.

(b) Held indirectly by CHPC through Origin Orbit.

(d) According to the Companies Law of the PRC, at the incorporation of the investee, shareholders are only required to pay up 20% of the capital contribution requirement as a minimum and can make up the remaining payment in two years’ time.

Note 2– Summary of Significant Accounting Policies

Basis of Presentation

The Company’s consolidated financial statements include the accounts of its controlled subsidiaries. All intercompany balances and transactions are eliminated in consolidation. The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) applicable to interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States of America for complete financial statements. Interim results are not necessarily indicative of results for a full year. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position and the results of operations and cash flows for the interim periods have been included.

In preparing the accompanying unaudited consolidated financial statements, we evaluated the period from March 31, 2011 through the date the financial statements were issued, for material subsequent events requiring recognition or disclosure. See Note 24.

Interim Financial Statements

These interim consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the years ended December 31, 2010 and 2009, as not all disclosures required by GAAP for annual consolidated financial statements are presented. The interim consolidated financial statements follow the same accounting policies and methods of computations as the audited consolidated financial statements for the years ended December 31, 2010 and 2009.

Reclassification

Certain amounts as of December 31, 2010 and March 31, 2010 were reclassified for presentation purposes.

Note 3– Restricted Cash

As of March 31, 2011 and December 31, 2010, the Company had restricted cash of $1,070,259 and $304,540, respectively. These restricted cash balances are reserved for settlement of trade notes payable in connection with inventory purchases. The cash held in custody by bank issuing the trade notes payable is restricted as to withdrawal or use, and is currently earning interest.

Note 4 – Inventories

Inventories by major categories are summarized as follows:

	March 31, 2011		December 31, 2010

Compressed natural gas	$	127,767	$	199,569
Liquefied petroleum gas		587,391		578,264
Dimethyl ether		21,939		97,452
Vehicle modification components and other		222,343		145,627

Total	$	959,440	$	1,020,912

Note 5 – Advance Payments

Advance payments as of March 31, 2011 and December 31, 2010 consist of the following:

	March 31, 2011		December 31, 2010

Inventories	$	8,850,819	$	9,363,683
Property and equipment		3,488,386		3,465,541
Total	$	12,339,205	$	12,829,224

Note 6 – Dividend Receivable

Dividend receivable as of March 31, 2011 and December 31, 2010 were $611,929 and $524,400, respectively, representing income receivable from Anyang Petro China and Ancai exhibited in Note 10.

Note 7 – Loans to Third Parties

Loans to third parties primarily consist of goodfaith non-interest bearing advances given to third parties and payable on demand. Loan to third parties outstanding as of March 31, 2011 and December 31, 2010 were $4,618,392 and $3,224,210, respectively.

Note 8 – Property and Equipment

Property and equipment consist of the following:

	March 31, 2011			December 31, 2010

Buildings	$	2,328,599		$	1,144,422
Machinery		3,951,523			3,129,046
Machinery – capital lease		316,513			-
Office equipment		88,091			75,363
Gas storage vehicles and motor vehicles		127,350			127,350
Construction in progress		401,729			1,731,539
		7,213,805			6,207,720
Less: Accumulated depreciation		(1,529,027	)		(1,475,882	)

Total	$	5,684,778		$	4,731,838

Depreciation expense for three months ended March 31, 2011 and 2010 was $43,269 and $17,900, respectively. As the equipment under capital lease has not been put in use as of March 31, 2011, no amortization was recorded for the three months ended March 31, 2011.

Note 8 – Capital Leases – Future Minimum Lease Payments

The Company leases certain machineries under agreements that are classified as capital leases. The cost of equipment under capital leases is included in the property and equipment and was $316,513 and $-0- as of March 31, 2011 and December 31, 2010, respectively. Accumulated amortization of the leased machinery as of March 31, 2011 and 2010 was $-0-, respectively. Amortization of assets under capital leases is included in depreciation expense.

The future minimum lease payments required under the capital leases and the present values of the net minimum lease payments as of March 31, 2011 are as follows:


Year Ending December 31,	Amount
2011	$	105,742
2012		127,114
2013		127,114
Total minimum lease payments	$	359,970
Less: Current maturities of capital lease obligations		(127,114	)
Long-term capital lease obligations	$	232,856

Note 9 – Deferred Income Taxes

Deferred income tax asset of $52,458 and $52,114 as of March 31, 2011 and December 31, 2010 arose from unused tax loss carry-forwards that management considers more likely than not that it will be realized through future operations. The tax loss carry-forwards are available for offset against future taxable income over the next five years.

Note 10 – Investments in Non-consolidated Entities

As of March 31, 2011, available-for-sale securities consist of the following:

Name of investee	Place of operation	Percentage of ownership	Principal activities

Anyang Dingran Gas Co., Ltd	PRC	38%	Natural gas pipeline, investment and management in CNG filling station

Anyang PetroChina Marketing Company Limited (“Anyang PetroChina”)	PRC	34%	Sales of crude oil and refined oil and LPG

Ancai Energy Corporation	PRC	15%	Long distance pipe network, LPG pipeline, operation of CNG filling station

As the above company is a private company whose shares are not quoted or traded in an active market, management has determined that it is not practicable to estimate their fair value reliably. Therefore, the investment in the above company is stated at cost less any impairment losses. No events or changes in circumstances have been identified that potentially would have a significant adverse effect on the fair value of investment in the above company. As of March 31, 2011, there was no allowance for impairment loss.

Anyang Dingran Gas Co., Ltd was incorporated on July 12, 2010, with a registered capital of $8 million, which was invested by Ancai Hi-tec Corporation, Antai Investment Co., Ltd., and Anyang Prosperous. Anyang Prosperous invested $3.04 million for its 38% equity interest in Anyang Dingran. It mainly engaged in the investment and operation in CNG and LNG stations. Through the CNG pipeline of branch of Henan, which can support 0.21billion M3 CNG per year, it will construct mother stations and standard stations, and now it was operated by the above three parties. Therefore, Anyang Dingran has been accounted for using the cost method instead of the equity method. For the three months ended March 31, 2011 and 2010, no dividend income was distributed from Anyang Dingran.

Although the Company held 34% ownership interest in Anyang PetroChina, the Company did not have significant influence over Anyang PetroChina. According to an agreement between the Company and the other shareholder of Anyang PetroChina, namely China National Petroleum Corporation (“China National Petroleum”), the Company has assigned the full power and right of management of Anyang PetroChina to China National Petroleum for the period until December 31, 2009. In return, the Company has been entitled to 10% of the cost of its investment in Anyang PetroChina in the form of a fixed “dividend” each year regardless of the actual performance of Anyang PetroChina for the period until December 31, 2009. Therefore, Anyang PetroChina has been accounted for using the cost method instead of the equity method. For the three months ended March 31, 2011 and 2010, dividend income of $81,378 and $78,421, respectively, from Anyang Petro China was included in other income.

The Company acquired 15% of the shares of Ancai Energy Co., Ltd (“Ancai”), which was established on April 18, 2008 and was registered with capital of approximate $1.17million. Ancai is mainly engaged in the investment in the construction of long-distance pipeline and delivery networks for natural gas, and pipeline LPG and CNG filling stations. The Jiaozuo-Anyang branch of the West-East natural gas transmission project had been built and put into operation in December 2003, which supplies natural gas to users in the cities of Jiaozuo, Xinxiang, Hebi, Anyang as well as industrial users. The project is not just an industrial project, but also a state key infrastructural project for clean energy. Almost 15 million people in Northern Henan can benefit from the project, which plays an important role in local industry and ecological environment. The investment made on Ancai will provide steady and qualified natural gas for the network of CNG filling stations that belong to the company and Henan Transport Authority, developing a stable market of filling stations which takes Ancai mother station as its center. Ancai has been accounted for using the cost method instead of the equity method. For the three months ended March 31, 2011 and 2010, dividend income of $2,112 and $-0- respectively, from Ancai was included in other income.

As of March 31, 2011, Ancai Group Inc, the 70% shareholder of Ancai, is responsible for the management of Ancai.

Note 11 – Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses as of March 31, 2011 and December 31, 2010 consist of the following:

	March 31, 2011		December 31, 2010

Accounts payable	$	1,282,905	$	1,509,024
Accrued expenses		17,081		14,003

Total	$	1,299,986	$	1,523,027

The carrying values of accounts payable and accrued expenses approximate their fair values due to the short-term nature of these obligations.

Note 12 – Short Term Bank Loans

Short-term bank loans consist of the following:

	March 31,		December 31,
	2011		2010

6.372% one-year term loan from Bank of China, signed on October 8, 2010, which is to be repaid in full by October 8, 2011. The loan is guaranteed by real estate of Anyang Century Plaza Century Real Estate Development Co., Ltd. Interest was paid quarterly.	$	457,600	$	455,100

6.672% one-year term loan from Bank of China, signed on November 9, 2010, which is to be repaid in full by November 9, 2011. The loan is guaranteed by real estate of Anyang Century Plaza Century Real Estate Development Co., Ltd. Interest was paid quarterly.		305,900		303,400

6.1160% one-year term loan from Zhengzhou Branch of Shanghai Pudong Development Bank, signed on November 18, 2010, which is to be repaid in full by November 18, 2011. The loan is guaranteed by 70% of the paid-up capital of $500 and rights to use land of Henan Small & Medium Enterprises Investment Guaranty Co., Ltd. Interest was paid monthly.		763,500		758,500

Total	$	1,527,000	$	1,517,000

Note 13 – Customer Advances

As of March 31, 2011 and December 31, 2010, the Company had advances from customers of $1,215,765 and $1,222,234, respectively. As a common business practice, the Company requires certain customers to make advance payments for purchase. Such advances are interest-free and unsecured.

Note 14 – Due to Former Shareholders

Balances of due to the former shareholders are mainly a result of a series of mergers and acquisitions of the Company in 2008. As of March 31, 2011 and December 31, 2010, the outstanding balance due to the former shareholders was $1,645,284 and $1,634,509.

Note 15 – Loans From Third Parties

Loans from third parties as of March 31, 2011 and December 31, 2010 consist of the following:

	March 31, 2011			December 31, 2010

Anyang Zhenyuan Group	$	17,516,022		$	17,417,588
Beijing Prosperous Energy Technology Developing Co., Ltd		1,465,920			1,456,320
Other		(839,850	)		-
Total	$	18,142,092		$	18,873,908

The proceeds of these loans were utilized as working capita. These loans are good-faith, unsecured, and non-interest bearing.

Note 16 – Income Taxes

The Company being incorporated in the State of Nevada is not subject to any income tax according to the rules and regulations of the State of Nevada. Before January 1, 2008, the Company’s subsidiaries in the PRC were generally subject to PRC enterprise income tax at 33%. On March 16, 2007, the PRC government promulgated a new tax law, China’s Unified Corporate Income Tax Law (“New CIT Law”), which took effect from January 1, 2008. Under the New CIT Law, foreign-owned enterprises as well as domestic companies are subject to a unified tax rate of 25%. Accordingly, the Company’s subsidiaries in the PRC have been subject to the PRC corporate income tax at a rate of 25% on their taxable income arising in the PRC commencing from January 1, 2008. Meanwhile, according to Rule 28 of New CIT Law, income tax of small low-profit enterprises is subject to the reduced rate of 20%. Changzhi Company as one of the Company’s subsidiaries meets the conditions of small low-profit enterprises, so Changzhi Company’s income tax rate of 20% in 2009.The effect of this change in tax rate has been reflected in the calculation of deferred income tax assets as of December 31, 2007 and thereafter.

The Company’s provision for income taxes consists of:

	For the three months ended March 31,
	2011		2010

Current	$	18,515	$	18,706
Deferred		-		-
Total provision for income taxes	$	18,515	$	18,706

Note 17 – Share – Based Payments

On December 3, 2010, the board of directors approved to issue 500,000 shares of the Company’s common stock to Mr. Zhijun Liu, the consultant of the Company for one year consultant service fee. The fair value on December 3, 2010 was $50,000 based on the quoted price of the Company’s common stock on that day. Total share-based payments recognized in income statement for the three months ended March 31, 2011 and 2010 were $12,501 and $-0-, respectively.

Note 18 – Earnings Per Share

The Company presents earnings per share on a basic and diluted basis. Basic earnings per share have been computed by dividing net earnings by the weighted average number of common shares outstanding. Diluted earnings per share have been computed by dividing net earnings plus convertible preferred dividends and interest expense (after-tax) on convertible debt by the weighted average number of common shares outstanding including the dilutive effect of equity securities. The weighted average number of common shares calculated for diluted EPS excludes the potential common stock that would be exercised under the options and warrants granted to officers because the inclusion of the potential shares from these options and warrants would cause an anti-dilutive effect by increasing the net earnings per share.

On February 22, 2011, the Company effectuated a 1 for 100 reverse stock split of its common stocks. All references to number of shares, except shares authorized, and to per share information in the consolidated financial statements have been adjusted to reflect the reverse stock split on a retroactive basis.

Note 18 – Earnings Per Share (continued)

	For the three months ended March 31
	2011		2010

Net income attributable to CHPC	$	10,204	$	23,175

Weighted average common shares		125,000		120,000
(denominator for basic income per share)

Effect of dilutive securities		-		-

Weighted average common shares		125,000		120,000
(denominator for diluted income per share)

Basic earnings per share	$	0.08	$	0.19
Diluted earnings per share	$	0.08	$	0.19

Note 19 – Risk Factors

The Company’s operations are carried out in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environments in the PRC as well as by the general state of the PRC’s economy. The Company’s business may be influenced by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things.

Note 20 – Concentration of Credit Risk

As of March 31, 2011 and December 31, 2010, 100% of the Company’s cash included cash on hand and deposits in accounts maintained within the PRC where there is currently no rule or regulation in place for obligatory

insurance to cover bank deposits in the event of bank failure. However, the Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts.

For the three months ended March 31, 2011 and Dec 31, 2010, all of the Company’s sales arose in the PRC. In addition, all accounts receivable as of March 31, 2011 and December 31, 2010 were due from customers located in the PRC.

As of March 31, 2011 and December 31, 2010, no single customer accounted for more than 10% of the company’s accounts receivable.

Note 21 – Supplemental Cash Flow Disclosures

The following is supplemental information relating to the consolidated statements of cash flows:

	For the three months ended March 31,
	2011		2010

Cash paid for interest	$	34,062	$	32,013
Cash paid for income taxes	$	18,515	$	18,706

Note 22 – Commitments and Contingencies

Lease commitments

The Company has entered into several tenancy agreements for the lease of land and equipment for the purpose of its gas stations. The Company’s commitments for minimum lease payments under these operating leases for the next five years and thereafter as of March 31, 2011 are as follows:

Period ended December 31,
2011	$	271,294
2012		246,206
2013		153,482
2014		145,334
2015		112,149
Thereafter		487,739

Total	$	1,416,204

Note 23 – Segment Information

ASC 280-10 (formerly SFAS 131), “Disclosure about Segments of an Enterprise and Related Information” requires that companies disclose segment data based on how management makes decision about allocating resources to segments and evaluating their performance.

The Company has re-evaluated the structure of its organization and has determined, based on the requirements of SFAS 131, that the Company has the following three reportable segments, identified based on the nature of products, the type or class of customers, and the methods used to distribute the Company’s products:

▪ Retail sales of Compressed Natural Gas (“CNG”) through operation of CNG filling stations;

▪ Retail sales of Liquefied Petroleum Gas (“LPG”) through operation of LPG filling stations; and

▪ Wholesale of CNG and LPG

During the ended March 31, 2011, all of the Company’s operations were carried out in one geographical segment – China.

The following table sets out the Company’s segment information. The “Unallocated” column in the following table contains the reconciliation between the amounts for reportable segments and the consolidated amounts, which consists primarily of corporate items not allocated to the operating segments, intersegment eliminations. Intersegment sales are accounted for at fair value as if sales were to third parties.

	For the Three Months Ended March 31,
Sales from external customers	2011			2010
CNG retail	$	2,169,684		$	1,319,449
LPG retail		78,462			157,665
CNG and LPG wholesale		6,130,369			2,342,933
Unallocated		900,446			852,949
Consolidated	$	9,278,961		$	4,672,996


	For the Three Months Ended March 31,
Net income attributable to CHPC		2011			2010
CNG retail	$	76,687		$	8,970
LPG retail		(26,759	)		(4,634	)
CNG and LPG wholesale		(81,224	)		(250,909	)
Unallocated		41,500			269,748
Consolidated	$	10,204		$	23,175

Note 23 – Segment Information (Continued)

	For the Three Months Ended March 31,
Investment income from non-consolidated entities	2011			2010
Consolidated	$	83,490		$	78,421

	For the Three Months Ended March 31,
Interest expenses		2011			2010
Consolidated	$	(34,062	)	$	(32,013	)

	For the Three Months Ended March 31,
Income before noncontrolling interest and income taxes		2011			2010
Consolidated	$	25,244		$	41,819

Segment assets	March 31, 2011			December 31, 2010
CNG retail	$	3,818,517		$	2,507,361
LPG retail		82,610			67,582
CNG and LPG wholesale		2,148,903			1,390,697
Unallocated		32,566,445			33,537,570
Consolidated	$	38,616,475		$	37,503,210

Note 24 – Subsequent events

On April 29, 2011, the company obtained loans in the amount of approximately $1.23 millions from Luoyang Bank, which is secured by the 2.5 million equities of Anyang Top Energy Green Resources Co., Ltd.

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

The following discussion contains forward-looking statements. Forward looking statements are identified by words and phrases such as “anticipate”, “intend”, “expect” and words and phrases of similar import. We caution investors that forward-looking statements are only predictions based on our current expectations about future events and are not guarantees of future performance. Our actual results, performance or achievements could differ materially from those expressed or implied by the forward-looking statements due to risks, uncertainties and assumptions that are difficult to predict, including those set forth in Item 1A above. We encourage you to read those risk factors carefully along with the other information provided in this Report and in our other filings with the SEC before deciding to invest in our stock or to maintain or change your investment. We undertake no obligation to revise or update any forward-looking statement for any reason, except as required by law.

You should read this MD&A in conjunction with the Consolidated Financial Statements and Related Notes in Item 1.

Unless otherwise noted, all currency figures in this filing are in U.S. dollars. References to "Yuan" or "RMB" are to the Chinese Yuan (also known as the Renminbi). According to Bank of China, as of March 31, 2011, RMB1: US$0.15270.

OVERVIEW

Our new primary business operations include: retail sales of CNG and operation of CNG filling stations; retail sales of LPG and operation of LPG filling stations; and wholesale of LPG and CNG. Our primary business is carried out by Origin Orbit through Anyang Prosperous and Anyang Top. Along with the reform and opening up and China's sustained economic growth and rising consumption level, the gas industry as the basis of the energy industry, has been in a sustained and rapid development process, including LPG and CNG, and other clean gas consumption. With China's sustained and rapid economic growth, and increasing social environmental awareness, clean, renewable energy has been encouraging by industrial policy. "The People's Republic of China National Economic and Social Development of the 11 th Five-Year Plan" clearly declaim that optimizing the energy industry to accelerate the development of LPG, to expand cooperation with offshore LPG resources, and develop gas industry. Especially "implement clean energy car action plan, development of hybrid vehicles, and promote gas use on city buses, taxis and other industries”. LPG, CNG and other clean energy will play an important role in future, there will be immense room for development and a very good development prospects. We plan to add 7 stations in 2010, 15 new stations in 2011, which will be the highlights of the Company.

In the remainder of this filing and its exhibits, “we, us or our” refers to China Prosperous Clean Energy Corporation, Origin Orbit, Anyang Prosperous and Anyang Top, collectively. The results of operations discussed below are the consolidated results of reflect the results of China Prosperous Clean Energy Corporation, Origin Orbit, Anyang Prosperous and Anyang Top.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our management's discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported net sales and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and assumptions. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating this management’s discussion and analysis.

Basis of Consolidation

These consolidated financial statements include the financial statements of CHPC and its subsidiaries. All significant inter-company balances and transactions have been eliminated on consolidation.

Allowance for Doubtful Accounts

The Company maintains allowances for doubtful accounts for estimated losses resulting from the failure of customers to make required payments. The Company reviews the accounts receivable on a periodic basis and makes allowances where there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, the customer’s payment history, its current credit-worthiness and current economic trends. Up to March 31, 2011, there was no accounts receivable reserve.

Available-for-sale Investments

Available-for-sale investments are equity securities which the Company does not intend to sell in the near term. The investees are private companies and do not have a quoted market price in an active market, so the fair value of available-for-sale investment cannot be practicably estimated are stated in the balance sheet using the cost method. Temporary impairments of costs of such available-for-sale investments are reported in other comprehensive income, where as other than temporary impairments are reflected in earnings.

Goodwill

The Company accounts for acquisitions of business in accordance with SFAS No. 141 “Business Combinations”, which may result in the recognition of goodwill. Goodwill represents the excess of the purchase price over the fair value of net assets acquired in business combinations accounted for under the purchase method. Goodwill is not subject to amortization but will be subject to periodic evaluation for impairment. Goodwill is stated in the condensed consolidated balance sheet at cost less accumulated impairment loss, if any.

Asset Impairment

(a) Long-lived Assets

The Company reviews and evaluates its long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. An impairment is considered to exist if the total estimated future cash flows on an undiscounted basis are less than the carrying amount of the assets, including goodwill, if any. An impairment loss is measured and recorded based on discounted estimated future cash flows. In estimating future cash flows, assets are grouped at the lowest level for which there is identifiable cash flows that are largely independent of future cash flows from other asset groups.

(b) Goodwill

The Company evaluates, on at least an annual basis, the carrying amount of goodwill to determine whether current events and circumstances indicate that such carrying amount may no longer be recoverable. To accomplish this, the Company compares the estimated fair value of its reporting units to their carrying amounts. If the carrying value of a reporting unit exceeds its estimated fair value, the Company compares the implied fair value of the reporting unit’s goodwill to its carrying amount, and any excess of the carrying value over the fair value is charged to earnings. The Company’s fair value estimates are based on numerous assumptions and it is possible that actual fair value will be significantly different than the estimates.

Revenue Recognition

Revenue is recognized when the following four revenue criteria are met: persuasive evidence of an arrangement exists, delivery has occurred, the selling price is fixed or determinable, and collectability is reasonably assured.

Sales revenue is recognized net of sales discounts and returns at the time when the merchandise is sold to the customer. Based on historical experience, management estimates that sales returns are immaterial and has not made allowance for estimated sales returns.

Income Taxes

The Company accounts for income taxes in accordance with SFAS No. 109, "Accounting for Income Taxes". SFAS No. 109 requires an asset and liability approach for financial accounting and reporting for income taxes and allows recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain.

On January 1, 2007, the Company adopted the provisions of FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 prescribes a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This Interpretation also provides guidance on recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods and income tax disclosures. The adoption of FIN 48 has not resulted in any material impact on the Company’s financial position or results.

Foreign Currency

The Company uses the United States dollars (“US Dollar” or “US$” or “$”) for financial reporting purposes. The Company maintains the books and records in its functional currency, Chinese Renminbi (“RMB”), being the primary currency of the economic environment in which its operations are conducted. In general, the Company translates its assets and liabilities into U.S. dollars using the applicable exchange rates prevailing at the balance sheet date, and the statement of income is translated at average exchange rates during the reporting period. Adjustments resulting from the translation of the Company’s financial statements are recorded as accumulated other comprehensive income.

The exchange rates used to translate amounts in RMB into U.S. Dollars for the purposes of preparing the condensed consolidated financial statements were as follows:

	March 31, 2011	March 31, 2010
Balance sheet items, except for paid-in capital and retained earnings as of the end of period	RMB1: US$0.15270	RMB1: US$0.14670

	Three months ended March 31, 2010	Three months ended March 31, 2009
Amounts included in the statements of income, statements of stockholders’ equity and statements of cash flows for the period	RMB1: US$0.15218	RMB1: US$0.14665

Segment Information

The Company has re-evaluated the structure of its organization and has determined, based on the requirements of ASC 280-10, that the Company has the following three reportable segments, identified based on the nature of products, the type or class of customers, and the methods used to distribute the Company’s products:

1)Retail sales of Compressed Natural Gas (“CNG”) through operation of CNG filling stations;

2)Retail sales of Liquefied Petroleum Gas (“LPG”) through operation of LPG filling stations; and

3)Wholesale of CNG and LPG

Recent Accounting Pronouncements

In April 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-17, Revenue Recognition—Milestone Method (Topic 605) – Revenue Recognition (ASU 2010-17). ASU 2010-17 provides guidance on defining the milestone and determining when the use of the milestone method of revenue recognition for research or development transactions is appropriate. It provides criteria for evaluating if the milestone is substantive and clarifies that a vendor can recognize consideration that is contingent upon achievement of a milestone as revenue in the period in which the milestone is achieved, if the milestone meets all the criteria to be considered substantive. ASU 2010-17 is effective for us in fiscal 2012 and should be applied prospectively. The adoption of this ASU will not have a material impact on the Company’s consolidated financial statements.

In January 2010, the FASB issued the following ASC Updates:

ASU No. 2010-01— Equity (Topic 505): Accounting for Distributions to Shareholders with Components of Stock and Cash. This Update clarifies that the stock portion of a distribution to shareholders that allows them to elect to receive cash or stock with a potential limitation on the total amount of cash that all shareholders can elect to receive in the aggregate is considered a share issuance that is reflected in EPS prospectively and is not a stock dividend for purposes of applying Topics 505 and 260 (Equity and Earnings Per Share). The amendments in this Update are effective for interim and annual periods ending on or after December 15, 2009 with retrospective application.

ASU No. 2010-02— Consolidation (Topic 810): Accounting and Reporting for Decreases in Ownership of a Subsidiary. This Update amends Subtopic 810-10 and related guidance to clarify that the scope of the decrease in ownership provisions of the Subtopic and related guidance applies to (i) a subsidiary or group of assets that is a business or nonprofit activity; (ii) a subsidiary that is a business or nonprofit activity that is transferred to an equity method investee or joint venture; and (iii) an exchange of a group of assets that constitutes a business or nonprofit activity for a noncontrolling interest in an entity, but does not apply to: (i) sales of in substance real estate; and (ii) conveyances of oil and gas mineral rights. The amendments in this Update are effective beginning in the period that an entity adopts FAS 160 (now included in Subtopic 810-10).

ASU No. 2010-06— Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements. This Update amends Subtopic 820-10 that requires new disclosures about transfers in and out of Levels 1 and 2 and activity in Level 3 fair value measurements. This Update also amends Subtopic 820-10 to clarify certain existing disclosures. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements, which are effective for fiscal years beginning after December 15, 2010.

The Company expects that the adoption of the above Updates issued in January 2010 did not and will not have any significant impact on its financial position and results of operations.

In January 2010, the FASB expanded the disclosure requirements for fair value measurements relating to the transfers in and out of Level 2 measurements and amended the disclosure for the Level 3 activity reconciliation to be presented on a gross basis. In addition, valuation techniques and inputs should be disclosed for both Levels 2 and 3 recurring and nonrecurring measurements. The new requirements are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about the Level 3 activity reconciliation which are effective for fiscal years beginning after December 15, 2010. The Company adopted the new disclosure requirements on January 1, 2010 except for the disclosure related to the Level 3 reconciliation, which will be adopted on January 1, 2011. The adoption will not have an impact on its consolidated financial condition, results of operations or cash flows.

In October 2009, the FASB issued an amendment to the accounting and disclosure for revenue recognition. The amendment modifies the criteria for recognizing revenue in multiple element arrangements. Under the guidance, in the absence of vendor-specific objective evidence (“VSOE”) or other third party evidence (“TPE”) of the selling price for the deliverables in a multiple-element arrangement, this amendment requires companies to use an estimated selling price (“ESP”) for the individual deliverables. Companies shall apply the relative-selling price model for allocating an arrangement’s total consideration to its individual deliverables. Under this model, the ESP is used for both the delivered and undelivered elements that do not have VSOE or TPE of the selling price. The guidance is effective for the fiscal year beginning on or after June 15, 2010, and will be applied prospectively to revenue arrangements entered into or materially modified after the effective date. The Company intends to adopt the new guidance prospectively beginning January 1, 2011 and is currently evaluating the impact the adoption will have on its consolidated financial statements.

On July 1, 2009, the Financial Accounting Standards Board (“FASB”) officially launched the FASB Accounting Standards Codification (“ASC”), which has become the single official source of authoritative nongovernmental US GAAP, in addition to guidance issued by the Securities and Exchange Commission. The ASC is designed to simplify US GAAP into a single, topically ordered structure. All guidance contained in the ASC carries an equal level of authority. The ASC is effective for all interim and annual periods ending after September 15, 2009.

On July 1, 2009, the Company adopted the accounting and disclosure requirements of Statement of Financial Accounting Standard (“SFAS”) No. 160, Noncontrolling Interests in Consolidated Financial Statements, an Amendment of ARB No. 51, which is now included with ASC Topic 810 Consolidation. This standard establishes a single method of accounting for changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation. On a prospective basis, any changes in ownership will be accounted for as equity transactions with no gain or loss recognized on the transactions unless there is a change in control.

RESULTS OF OPERATIONS

The following table sets forth the amounts and the percentage relationship to revenues of certain items in our consolidated statements of income for the three months ended March 31 , 2011 and 2010.

Profit & Loss for the quarter ended March 31, 2011 and 2010

	For the quarter ended March 31, 2011						For the quarter ended March 31, 2010						Changes
	Amount			Percentage of Revenue			Amount			Percentage of Revenue			Amount			Percentage
	$			(%)			$			(%)			$			(%)
SALES	$	9,278,961			100.00	%		4,672,996			100.00	%		4,605,965			98.57	%

COST OF SALES		8,257,567			88.99	%		3,979,668			85.16	%		4,277,899			107.49	%

GROSS PROFIT		1,021,394			11.01	%		693,328			14.84	%		328,066			47.32	%

Operating Expenses		1,047,046			11.28	%		601,755			12.88	%		445,291			74.00	%

Selling expenses		740,401			7.98	%		420,150			8.99	%		320,251			76.22	%

General & administrative expenses		306,645			3.30	%		181,605			3.89	%		125,040			68.85	%

Income (loss) from Operations		(25,652	)		(0.28	) %		91,573			1.96	%		(117,225	)		(128.01	) %

Other Income (Expenses)		50,896			0.55	%		(49,754	)		(1.06	) %		100,650			202.30	%

Investment income		83,490			0.90	%		78,421			1.68	%		5,069			6.46	%

Interest expenses		(34,062	)		(0.37	) %		(32,013	)		(0.69	) %		(2,049	)		(6.40	) %

Other income (expenses)		1,468			0.02	%		(96,162	)		(2.06	) %		97,630			101.53	%

Income before provision for income taxes		25,244			0.27	%		41,819			0.89	%		(16,575	)		(39.63	) %

Provision for Income Taxes		18,515			0.20	%		18,706			0.40	%		(191	)		(1.02	) %

Income before noncoltrolling interest		6,729			0.07	%		23,113			0.49	%		(16,384	)		(70.88	) %

Noncontrolling interest		(3,475	)		(0.04	) %		(62	)		-	%		3,413			(5,504.84	) %

NET INCOME		10,204			0.11	%		23,175			0.49	%		(12,971	)		(55.97	) %

Foreign currency translation adjustment		156,574			-			9			-			156,565			17,396.11	%

TOTAL COMPREHENSIVE INCOME		166,778			1.80	%		23,184			0.49	%		143,594			619.37	%

The “Results of Operations” discussed in this section merely reflect the information and results of Origin Orbit for the three months ended March 31, 2011 and 2010.

SALES

Historical Financial Information for the quarter ended March 31, 2011 and for the quarter ended March 31, 2010:

	For the quarter ended March 31 2011			For the quarter ended March 31 2010			Change in Percentage (%)
Sales	$	9,278,961		$	4,672,996			98.57	%
Net income	$	10,204		$	23,175			(55.97	%)
Net Income as a percentage of sales	$	0.11	%	$	0.49	%		(77.55	%)

The Company’s consolidated sales increased to $9,278,961 for the quarter ended March 31, 2011, a 98.57% increase from $4,672,996 reported for the quarter ended March 31, 2010. The increase in revenue resulted primarily from the following factors:

1)	The retail prices of natural gas filling stations of the Company located in Anyang, Jiaozuo, Changzhi have been adjusted upwards along with China's domestic retail prices of crude oil.

2)	With China's rapid economic growth, we organize the thought and seize chance to develop the LPG wholesale market, which resulted the business growth of 161.65% compared with the same quarter of last year.

Our consolidated net income decreased by 55.97% to$10,204 for the quarter ended March 31, 2011, as compared to$23,175for the quarter ended March 31, 2010. This decrease was attributable to:

1)	The Company’s consolidated sales increased by 98.57% for the quarter ended March 31, 2011 compared with the same quarter of last year, but purchasing costs increase more than revenue growth, which resulted in decline of gross profit .

2)	The increase in expense. In December, 2010,a technical services agreement was entered between Liu Zhijun and the Company,according to the agreement, service charge of $12,501 was accounted in this quarter.

Revenues breakdown by segments for the quarter ended March 31, 2011and for the quarter ended March 31, 2010 (in US Dollar)

Items	For the quarter ended March 31, 2011 ($)		Percentage (%)	For the quarter ended March 31, 2010 ($)	Percentage (%)		Change in Amount ($)	Change In Percentage (%)
CNG retail		2,169,684	23.38%	1,319,449		28.24%	850,235		64.44%
CNG wholesale		-		1,596		0.03%	(1,596)		(100.00)%
LPG retail		78,462	0.85%	157,665		3.37%	(79,203)		(50.23)%
LPG wholesale		6,130,369	66.07%	2,341,337		50.10%	3,789,032		161.83%
Others		900,446	9.70%	852,949		18.25%	47,497		5.57%
TOTAL		9,278,961	100.00%	4,672,996		100.00%	4,605,965		98.57%

The CNG retail for the quarter ended March 31, 2011 was increased by 64.44% as compared to the quarter ended March 31, 2010. This was mainly due to:

Pursuant to the "The Guideline Catalog of Industrial Structure Adjustment (2007)" issued by National Development and Reform Commission (NDRC) new and clean energy vehicles were officially listed among the “encouraged products” and CNG/petroleum dual-fuel automobiles, a major type of clean energy vehicles, are staged for full promotion by NDRC, which lead to the significant increase in our CNG retail sales;

2)	In July 2010, one new CNG filling station was put into operation, which contributed to the increase in CNG retail sales;

3)	The retail prices of natural gas have been adjusted upwards along with China's domestic retail prices of crude oil.

LPG retail sales fell by 50.23% compared to the same quarter of 2010. This was mainly due to the shift of favorable policy preference from LPG/gas dual-fueled vehicles to CNG/gas dual-fueled vehicles by central and local governments. As a result, our main LPG retail customers, taxis and city buses, have been converted to CNG dual-fuel vehicles, at the same time, because of the city planning of Handan, one of our LPG stations was ceased to work, which caused the decrease in our existing LPG retail sales.

LPG wholesales increased by 161.83% compared to the same quarter of 2010. This was mainly due to :

With China's rapid economic growth, some customers affected by economic crisis gradually resume production, and we promptly adjust our strategy and seize chance to develop the LPG wholesale market, and rebuild the relationship with the former customers and cooperate with new ones, which caused the increase in our existing LPG wholesales.

COST OF SALES (COS)

COS for the quarter ended March 31, 2011 was $8,257,567 which is 88.99% of total revenues and represents a 107.49% increase as compared to$3,979,668 and 85.16% of total revenues for the quarter ended March 31, 2010. The increase in COS as a percentage of total revenue was primarily because:

1) Along with the increase in sales,COS increased too.

2) Along with the increase in the prices of petroleum products, there is the increasing demand for natural gas.

COS as a percentage of revenue may fluctuate in the future. This fluctuation may primarily be due to changes in the price of our procurement price and selling price, which can have a significant impact on the COS. The Company will adopt proper measures to reduce fluctuations in the COS. These measures includes: centralized purchasing to obtain lower prices of raw materials, maintaining long-term stable cooperative relations with the existing gas source suppliers, increasing the development of new gas suppliers, and solving gas supply problems and reducing the cost of sales by way of joint venture and self-built CNG mother stations.

GROSS PROFIT MARGIN

Gross Profit Margin of major products in 2011and 2010 (for the quarter ended March 31):

Gross Margin	2011		2010		Comparisons
TOTAL		11.01%		14.84%		(3.83%)
CNG Retail		20.90%		23.10%		(2.20%)
CNG Wholesale				20.00%		(20.00%)
LPG Retail		9.30%		32.58%		(23.28%)
LPG Wholesale		3.00%		2.11%		(0.89%)

Raw Material Procurement

We were able to maintain relatively low purchase price even given the strong fluctuation of LPG price.

Average Price of Raw Material in the quarter ended March 31, 2011and 2010 (net of tax)

Quarter Ended March 31	Retail LPG (per ton)		Wholesale LPG (per ton)		CNG (per cube)
2010	$	638.88	$	599.71	$	0.32
2011	$	954.94	$	717.22	$	0.41

SELLING EXPENSES

Selling expenses for the quarter ended March 31, 2011 mainly included the salary of sales personnel and transportation cost. In the first quarter of 2011, selling expenses amounted to $ 740,401, representing 7.98% of total revenue. The retail business sells its product through its own retail outlets whereas the wholesale business sells its product in the domestic market through direct distribution. The major component of selling expenses is transportation cost. The company mainly uses tank trucks to transport its products. In the first quarter of 2011, the transportation cost increased 65.59% to approximately$421,510 compared with approximately $254,545 in the same quarter 2010.

The selling expenses for the quarter ended March 31, 2011 increased by 76.22% as compared to $420,150 for the quarter ended March 31, 2010. The main reason is that along with the increase in LPG wholesale, the related transportation cost increased too.

GENERAL AND ADMINISTRATIVE EXPENSES

The general and administrative expenses for the quarter ended March 31, 2011, mainly included the salary and welfare of the management personnel and office related expenses,$306,645, which accounted for 3.30% of total sales. For the quarter ended March 31, 2010, the general and administrative expenses was $181,605, accounted for 3.89% of total sales, which represents a 68.85% increase. The reason of the increase was that :

1) In December, 2010,a technical services agreement was entered between Liu Zhijun and the Company,according to the agreement, service charge of $12,501 was accounted in this quarter.

2) Shijiazhuang Prosperous was put into trial operation in July 2010, general and administrative expenses and depreciation allowances increased, so the related office expenses increased.

FINANCING COSTS

The financial expenses mainly consisted of interest expenses and bank charges. For the quarter ended March 31, 2011, interest expenses was $34,062, representing 0.37% of total sales. For quarter ended March 31, 2010, it was $32,013 representing 0.69% of total sales.

The main reason for the increase of the $2,049 in interest expenses, which represents a 6.40% in crease as compared to $32,013 for the quarter ended March 31, 2010, is that Bank of China increased the interest rate.

INCOME FROM OPERATIONS

The Company's consolidated operating income for the quarter ended March 31, 2011 decreased by 128.01 % to$(25,652), from $91,573 reported for the quarter ended March 31, 2010. This was mainly due to:

(a) The Company’s consolidated sales increased by 98.57% for the quarter ended March 31, 2011 compared with the same quarter of last year, but purchasing costs increase more than revenue growth, which resulted in decline of gross profit .

(b) Along with the increase of sales, operating expense increased.

We believe income from operations will show further improvements as we will continue building new CNG filling stations with further revenue source, aided by prudent cost controls on both the production and operating components of our business. We anticipate further improvements in cost of sales, increased sales and market share. Thus, while management expects this factor to favorably benefit gross and operating income, we also anticipate that with the addition of quality members to management, efficiency will be enhanced, which will also improve margins.

We are positive about the future increase in the net income as it will benefit from the following factors:

We will continue building new CNG filling stations as to expand our market share, such as Linying mother station that was completed in June 2010, and put into operation in April,2011. The second gas station in Changzhi was completed by the end of 2010;One LPG station in Anyang was changed into CNG station. Currently the above two stations is carrying on the related procedures approved by government, and will be put into operation in June 2011.

The Company will take proper measures to reduce fluctuations in the COS. These measures includes: centralized purchasing to obtain lower prices of raw materials, maintaining long-term stable cooperative relations with the existing gas source suppliers, increasing the development of new gas suppliers, and solving gas supply problems and reducing the cost of sales by way of joint venture and self-built CNG mother stations.

We are also looking forward to reorganization and optimization of existing management processes, improvement of internal management, increase management efficiency and reduction of administrative costs, which will lead to the increase of our profits.

NET INCOME

The net income for the quarter ended March 31, 2011 was $10,204 and 0.11% of sales, comparing to $23,175 and 0.49% in the same quarter in 2010. The main reason of the decrease was that purchasing cost of CNG increased, while gross margin decreased.

ACCOUNT RECEIVABLE

Account receivable balance as of March 31, 2011and December 31, 2010 was $481,200 and $541,809,, respectively The average turnover rate of account receivable is 18 times, or 20 days.

LIQUIDITY AND CAPITAL RESOURCES

The primary source of liquidity had been cash generated from operations. Historically, the primary liquidity requirements were for capital expenditures and working capital and investments. Our contractual obligations, commitments and debt service requirements over the next several years are insignificant.

Our primary source of liquidity will continue to be cash generated from operations as well as existing cash on hand. If our current cash and cash equivalents and cash generated from operations will not satisfy our expected working and other capital requirements for the foreseeable future based on current business strategy and expansion plan, we will have available resources to meet both our short-term and long-term liquidity requirements, including debt service. If our cash flow from operations is insufficient to fund our debt service and other obligations, we may choose to use other means available to us such as to increase our borrowings under our lines of credit, reduce or delay capital expenditures, seek additional capital or seek to restructure or refinance our indebtedness.

As of March 31, 2011 and December 31, 2010, the Company had cash and cash equivalents of approximately $2,374,454 and $ 3,806,939 respectively.

The following is a summary of cash provided by or used in each of the indicated types of activities during the three months ended March 31, 2011 and 2010:

Cash provided by (used in):	Three months ended March 31, 2011			Three months ended March 31, 2010			Change
							Amount			Percentage
	($)			($)			($)			(%)
Operating Activities		2,034,467			401,893			1,632,574			406	%

Investing Activities		(2,340,096	)		(842,535	)		1,497,561			178	%

Financing Activities		(1,236,658	)		516,071			(1,752,729	)		(340	%)

Net cash flow provided by operating activities was $2,034,467 in the three months ended March 31, 2011, as compared to net cash flow provided by operating activities of $401,893 in the three months ended March 31, 2010, representing a increase of $1,632,574 or 406%. Along with the recovery of Chinese economy, we will maintain long-term stable cooperative relations with our existing gas source suppliers, increase the development of new gas suppliers, solve gas supply problems and reduce cost of sales by way of joint venture and self-built CNG mother stations, so as to reduce fluctuations in the COS and by doing so, cash flow used in operating activities will meet our liquidity requirements.

The increase in net cash inflows from operating activities was mainly due to: Advance payments decreased and Customer advances increased.

Net cash flow used in investing activities was ($2,340,096) for the three months ended March 31, 2011, as compared to net cash used in investing activities of $1,497,561 for the three months ended March 31, 2010, representing a decrease of $1,497,561 or 178%. The decrease of net cash flow used in investing activities was mainly because we lent $1,527,000 to ZHONG JI INDUSTRY INTERNATIONAL INVESTMENT CO.,LTD.

Net cash flow provided by financing activities was($1,236,658) for the three months ended March 31, 2011 as compared to net cash provided by financing activities of$516,071 for the three months ended March 31, 2010, representing a decrease of $1, 752,729 or 340%. This is mainly due to the decrease of the loans from other third party.

We do not believe that inflation had a significant negative impact on our results of operations during 2010.

As of March 31, 2011, our total assets were $38,616,475 and our total liabilities were $27,113,869. Our debt to total assets ratio, calculated as total liabilities (including short-term debt and payables) over total assets, was 0.70:1.

As of December 31, 2010, our total assets were $37,503,210 and our total liabilities were $26,167,175. Our debt to asset ratio, calculated as total liabilities (including short-term debt and payables) over total assets, was 0.70:1.

Based on past performance and current expectations, we believe our cash and cash equivalents, cash generated from operations, as well as future possible cash investments, will satisfy our working capital needs, capital expenditures and other liquidity requirements associated with our operations for at least the next 12 months.

INCOME TAXES

The Company being incorporated in the State of Nevada is not subject to any income tax according to the rules and regulations of the State of Nevada. Before January 1, 2008, the Company’s subsidiaries in the PRC were generally subject to PRC enterprise income tax at 33%. On March 16, 2007, the PRC government promulgated a new tax law, China’s Unified Corporate Income Tax Law (“New CIT Law”), which took effect from January 1, 2008. Under the New CIT Law, foreign-owned enterprises as well as domestic companies are subject to a unified tax rate of 25%. Accordingly, the Company’s subsidiaries in the PRC have been subject to the PRC corporate income tax at a rate of 25% on their taxable income arising in the PRC commencing from January 1, 2008. Meanwhile, according to Rule 28 of New CIT Law, income tax of small low-profit enterprises is subject to the reduced rate of 20%. Changzhi Company as one of the Company’s subsidiaries meets the conditions of small low-profit enterprises. So Changzhi Company’s income tax rate was 20% in 2009.The effect of this change in tax rate has been reflected in the calculation of deferred income tax assets as of December 31, 2007 and thereafter.

The Company’s provision for income taxes consisted of:

	For the Three Months
	Ended March 31,
	2011		2010

Current – PRC	$	18,515	$	18,706

Deferred	$	-	$	-

OFF-BALANCE SHEET ARRANGEMENTS

We have not entered into any other financial guarantees or other commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as stockholder’s equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. We conducted an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15 of the Exchange Act. Based on this Evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our Disclosure Controls were effective as of the end of the period covered by this report.

Changes in Internal Controls

We have also evaluated our internal controls for financial reporting, and there have been no change in our internal control over financial reporting or in other factors that has materially affected, or is reasonably likely to materially affect our internal control over financial reporting subsequent to the date of last evaluation.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Currently we are not involved in any pending litigation or legal proceeding.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On June 19, 2008, Walter Brenner and Horst Balthes (the "Affiliate Sellers"), two major shareholders and affiliates of the Company consummated two Affiliate Stock Purchase Agreements (the "Affiliate Agreements") with Oracular Dragon. Pursuant to the terms and conditions of the Affiliate Agreements, Oracular Dragon acquired from the Affiliate Sellers a total 3,100,000 shares of common stock of the Company for a total price of $ 75,000. Also on June 19, 2008, a group of non-Affiliate Stockholders ("Non-Affiliate Sellers") of the Company consummated a Non-Affiliate Stock Purchase Agreement ("Non-Affiliate Agreement") with Oracular Dragon. Pursuant to the terms and conditions of the Non-Affiliate Agreement, Oracular Dragon acquired from the Non-Affiliate Sellers a total 1,424,231 shares of common stock of the Company for a total price of $ 271,586. As the result, Oracular Dragon acquired from Affiliate and Non-Affiliate Sellers a total 4,524,231 shares of common stock of the Company, representing approximately 73.7% of the total issued and outstanding shares of the Company.

Oracular Dragon is a company organized under the laws of British Virgin Islands and has its principal place of business in the People’s Republic of China. Oracular Dragon is neither a U.S Person, as such term is defined in Rule 902(k) of Regulation S, nor is it located within the United States.

On June 30, 2008, the Company entered a share exchange agreement ("Share Exchange Agreement”) under which the Company issued 5,865,000 shares of its common stock, par value $ 0.00001, to Oracular Dragon in exchange for all the issued and outstanding shares that Oracular Dragon owned in Origin Orbit Green Resource Company, Ltd. (“Origin Orbit”), the wholly-owned subsidiary of Oracular Dragon (“Share Exchange Transaction”).

The Share Exchange Transaction is the final part of a series of consecutive transactions including the Affiliate and Non-Affiliate Stock Purchase Transactions consummated on June 19, 2008 (“Stock Purchase Transactions”). The Share Exchange Transaction and Stock Purchase Transactions, combined together, were to ensure that the Company was able to acquire 100% of the beneficial ownership interest in Origin Orbit.

Origin Orbit is a holding company that, on April 4, 2007, acquired 100% of the capital stock of Anyang Prosperous Energy Technology Developing Co., Ltd. (“Anyang Prosperous”) and Anyang Top Energy Green Resources Co., Ltd. (“Anyang Top”), both of which were organized under the laws of the People’s Republic of China (“PRC”). Upon the acquisition of Origin Orbit, Anyang Prosperous and Anyang Top became our subsidiaries that we own through Origin Orbit.

Following the acquisition of Origin Orbit, we ceased all the metal exploring business. Our new primary business operations include: retail sales of CNG and operation of CNG filling stations; retail sales of LPG and operation of LPG filling stations; and wholesale of LPG and CNG. Our primary business is carried out by Origin Orbit through Anyang Prosperous and Anyang Top.

On October 14, 2008, we changed our legal name from “Acropolis Precious Metals, Inc.” to “China Prosperous Clean Energy Corporation”.

On December 03, 2010, we entered a Consulting Agreement with Mr. Zhijun Liu, who is a citizen and resident of the People’s Republic of China. Under the Consulting Agreement, Mr. Zhijun Liu will advise and assist us to identify potential merger and acquisition targets, expand business operations in North China (Beijing, Tianjin, Hebei Province, Shanxi Province and Inner Mongolia Autonomous Region, select and hire managerial talents, select and develop new clean energy products and develop market plans to improve the sales in company’s existing markets. The term of the Consulting Agreement is one year and the compensation for Mr. Zhijun Liu’s services is 500,000 shares of common stock of the Company.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

The following documents are filed as a part of this report or are incorporated by reference to previous filings, if so indicated:

Exhibit No.		Description

3.1		Articles of Incorporation (1)

3.2		Bylaws (1)

10.1		Affiliate Stock Purchase Agreement between Walter Brenner and Oracular Dragon Capital Company, Ltd. (2)

10.2		Affiliate Stock Purchase Agreement between Horst Balthes and Oracular Dragon Capital Company, Ltd.(2)

10.3		Non-Affiliate Stock Purchase Agreement (2)

10.4		Share Exchange Agreement, dated June 30, 2008, between Company and Oracular Dragon Capital Company, Ltd.(3)

10.5		Consulting Agreement between Company and Zhijun Liu (4)

31.1		Section 302 Certificate of Chief Executive Officer *

31.2		Section 302 Certificate of Chief Financial Officer *

32.1		Section 906 Certificate of Chief Executive Officer *

32.2		Section 906 Certificate of Chief Financial Officer *

* filed herewith

(1) Incorporated by reference to the Form SB-2 registration statement filed on June 29, 2007.

(2) Incorporated by reference to the Report on Form 8-K as filed on June 20, 2008

(3) Incorporated by reference to the Report on Form 8-K as filed on June 30, 2008.

(4) Incorporated by reference to the Report on Form 8-K as filed on December 07, 2010

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: May 12, 2011	CHINA PROSPEROUS CLEAN ENERGY CORPORATION

	/s/Hongjie Zhou
	Hongjie Zhou
	Acting Chief Financial Officer

CHINA PROSPEROUS CLEAN ENERGY Corp 10-Q