UNITED STATES

SECURITIES AND EXCHANGE COMMISSION,

Washington, D.C. 20549

FORM 10-K

(X) Annual Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Fiscal Year Ended December 31, 2008

( ) Transaction Report Under Section 13 or 15(d) of Securities Exchange Act of 1934

For the transition period from ______ to ______

DISCOVERY OIL, LTD.

(Name of Small Business Issuer in its Charter)

DELAWARE

(State or other jurisdiction of incorporation or organization)

333-06718

Commission File Number

83-0207909

(I.R.S. Employer Identification Number)

6127 Ramirez Canyon Road,

Malibu, CA 90265

(310) 457-1967

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered under Section 12(b) of the Exchange Act: None

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $.001 par value.

(Title of Class)

Indicate by checkmark if the registrant is a well-know seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No þ
Indicate by checkmark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ

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

Large accelerated filer o

Accelerated filer o

Non-accelerated filer o
(Do not check if a smaller reporting company)

Smaller reporting company þ

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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days. Based upon the price at close of market on March 23, 2009 of $0.008, the aggregate market value of the Registrant’s common stock held by non-affiliates was $65,651.

The number of shares outstanding of the registrant's common stock as of March 23, 2009: 25,245,921 shares.

DOCUMENTS INCORPORATED BY REFERENCE

None.

DISCOVERY OIL, LTD.

Form 10-K

December 31, 2008

TABLE OF CONTENTS

		Page
Forward Looking Statements		3

Part I
Item 1.	Business.	4

Item 1A.	Risk Factors	7

Item 1B.	Unresolved Staff Comments	7

Item 2.	Description of Properties.	7

Item 3.	Legal Proceedings.	7

Item 4.	Submission of Matters to a Vote of Security Holders	7

Part II
Item 5.	Market for Common Equity and Related Stockholder Matters, and Issuer Purchases
	of Equity Securities	8

Item 6.	Selected Financial Data	8

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	9

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	11

Item 8.	Financial Statements and Supplementary Data	12

Item 9.	Changes in and Disagreement with Accountants on Accounting and
	Financial Disclosure	23

Item 9A.	Controls and Procedures	23

Item 9B.	Other Events	24

Part III
Item 10.	Directors, Executive Officers, Promoters and Control Persons, Compliance
	Section 16(a) of the Exchange Act.	25

Item 11.	Executive Compensation.	26

Item 12.	Security Ownership of Certain Beneficial Owners and Management	27

Item 13.	Certain Relationships and Related Transactions and Director Independence.	27

Item 14.	Principal Accountant Fees and Services	28

Item 15.	Exhibits and Financial Statement Schedules	28

Signatures		29

FORWARD-LOOKING STATEMENTS

This Report on Form 10-K contains certain forward-looking statements. These forward looking statements might include statements regarding (i) research and development plans, marketing plans, capital and operations expenditures, and results of operations; (ii) potential financing arrangements; (iii) potential utility and acceptance of the Registrant's existing and proposed products; and (iv) the need for, and availability of, additional financing.

Any forward-looking statements included herein are based on current expectations and involve a number of risks and uncertainties. These forward-looking statements are based on assumptions regarding the business of Discovery Oil, Ltd, the ("Company"), which involve judgments with respect to, among other things, future economic and competitive conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes that the assumptions underlying the forward looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, actual results may differ materially from those set forth in the forward-looking statements.

EXPLANATORY NOTE: As used in this report, the terms "we", "us", and "our" are sometimes used to refer to Discovery Oil, Ltd. and, as the context requires, its management.

PART I

Item 1. Description of Business

Discovery Oil, Ltd. (the "Company", "Registrant", or "Discovery Oil"), was originally organized under the laws of the State of Wyoming in 1964. The Company became a Delaware corporation through a merger with a wholly owned subsidiary in 1981. Prior to 1992, the Company was involved as a general partner in several limited partnerships for the purpose of drilling oil and gas wells in Ohio, Wyoming, Colorado, Kansas, and Texas. In 1988 the company filed a petition in Bankruptcy pursuant to Chapter 11 of the Bankruptcy code in a United States Bankruptcy Court. On July 10, 1996, the Court entered its order and Final Decree, confirming the execution of the Company's reorganization plan and concluding all proceedings and jurisdiction of the bankruptcy.

The Company formerly had a non-operating working interest in six producing oil wells having proved reserves. This interest was sold on August 12, 2004.

Current Strategy

Since the sale of previous interests, Discovery Oil has no revenue and has become a shell company. The Company is currently searching for a new investment opportunity in the oil industry, which would probably take the form of a merger, stock- for-stock exchange or stock-for-assets exchange. No assurances can be made that we will be successful in locating and negotiating with possible merger candidates.

The Company maintains an office in Malibu, California.

Selection of a Business

Since we have no current business, our plan of operation will be to seek one or more suitable business combinations or acquisitions to create value for our shareholders. Management has adopted a conservative policy of seeking opportunities that it considers to be of exceptional quality. Therefore, we may have to wait some time before consummating a suitable transaction. Management recognizes that the higher the standards it imposes upon us, the greater may be its competitive disadvantage when vying with other acquiring interests or entities.

The Company does not intend to restrict its consideration to any particular business or industry segment, though management intends to continue its focus on opportunities related to natural resources. Due to our lack of financial resources, the scope and number of suitable business ventures is limited. We are therefore most likely to participate in a single business venture. Accordingly, the Company will not be able to diversify and will be limited to one merger or acquisition. The lack of diversification will prevent us from offsetting losses from one business opportunity against profits from another.

The decision to participate in a specific business opportunity will be made upon management’s analysis of the quality of the opportunity’s management and personnel, the anticipated acceptability of products or marketing concepts, the merit of technological changes and numerous other factors which are difficult, if not impossible, to analyze through the application of any objective criteria. Further, it is anticipated that the historical operations of a specific venture may not necessarily be indicative of the potential for the future because of the necessity to substantially shift a marketing approach, expand operations, change product emphasis, change or substantially augment management, or make other changes. The Company will be partially dependent upon the management of any given business opportunity to identify such problems and to implement, or be primarily responsible for the implementation of required changes.

Since we may participate in a business opportunity with a newly organized business or with a business which is entering a new phase of growth, it should be emphasized that the Company may incur risk due to the failure of

the target’s management to have proven its abilities or effectiveness, or the failure to establish a market for the target’s products or services, or the failure to realize profits.

The Company will not acquire or merge with any company for which audited financial statements cannot be obtained. Management anticipates that any opportunity in which we participate will present certain risks. Many of these risks cannot be adequately identified prior to selection of a specific opportunity. Our shareholders must therefore depend on the ability of management to identify and evaluate such risks. Further, in the case of opportunities available to us, it may be anticipated that some opportunities are yet to develop as going concerns or that some opportunities are in the development stage and have not generated significant revenues from principal business activities prior to our participation.

Acquisition of Business

Implementation of a structure for any particular business acquisition may involve a merger, consolidation, reorganization, joint venture, franchise or licensing agreement with another corporation or entity. The Company may also purchase stock or assets of an existing business. On the completion of a transaction, it is possible that present management and shareholders of the Company would not remain in control of the Company. Further, our sole officer and director may, as part of the terms of any transaction, resign, to be replaced by new officers and directors without a vote of our shareholders.

We anticipate that any securities issued in any such reorganization would be issued in reliance on exemptions from registration under applicable federal and state securities laws. However, in certain circumstances, as a negotiated element of any transaction, the Company may agree to register securities either at the time a transaction is consummated, under certain conditions, or at a specified time thereafter. The issuance of substantial additional securities and their potential sale into any trading market may have a depressive effect on such market.

While the actual terms of a transaction to which the Company may be a party cannot be predicted, it may be expected that the parties to a business transaction will find it desirable to avoid the creation of a taxable event and thereby structure the acquisition in a so called “tax-free” reorganization under Section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the “Code”). In order to obtain tax-free treatment under the Code, it may be necessary for the owners of the acquired business to own 80% or more of the voting stock of the surviving entity. In such event, our shareholders would retain less than 20% of the issued and outstanding shares of the surviving entity, which could result in significant dilution in the equity of such shareholders.

Our due diligence process will require that management meet personally with the personnel involved in any given transaction, visit and inspect material facilities, obtain independent analysis or verification of the information provided, check references for management and key persons, and take other reasonable investigative measures, to the extent of our limited financial resources and management expertise.

The manner in which we participate in an opportunity will depend on the nature of the opportunity, the respective needs and desires of the Company and other parties, the management of the opportunity, and the our relative negotiating strengths. Negotiations that involve mergers or acquisitions will focus on the percentage of the Company that the target company shareholders would acquire in exchange for their shareholdings in the target company. Depending upon, among other things, the target company’s assets and liabilities, our shareholders will in all likelihood hold a lesser percentage ownership interest in the Company following any merger or acquisition. The percentage ownership may be subject to significant reduction in the event the Company acquires a target company with substantial assets. Any merger or acquisition effected by the Company can be expected to have a significant dilutive effect on the percentage of shares held by our current shareholders.

Operation of Business After Acquisition

The Company’s operation following its merger or acquisition of a business will be dependent on the nature of the business and the interest acquired. We are unable to determine at this time whether the Company will be in control of the business or whether present management will be in control of the Company following the acquisition. We may expect that any future business will present various challenges that cannot be predicted at the present time.

Government Regulation

The Company cannot anticipate the government regulations, if any, to which we may be subject until we have acquired an interest in a business. The use of assets to conduct a business that we may acquire could subject us to environmental, public health and safety, land use, trade, or other governmental regulations and state or local taxation. Our selection of a business in which to acquire an interest will include an effort to ascertain, to the extent of the limited resources of the Company, the effects of any government regulation on the prospective business of the Company. However, in certain circumstances, such as the acquisition of an interest in a new or start-up business activity, it may not be possible to predict with any degree of accuracy the impact of government regulation.

Competition

We will be involved in intense competition with other business entities, many of which will have a competitive edge over us by virtue of their stronger financial resources and prior experience in business. The Company can provide no assurance that we will be successful in obtaining a suitable business opportunity.

Marketability

As we currently are not involved in selling products or services, there can be no assurance that we will be successful in marketing any such products or services or whether a market will develop.

Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements and Labor Contracts

We currently have no patents, trademarks, licenses, franchises, concessions, royalty agreements or labor contracts.

Research and Development

We spent no amounts on research and development activities during each of the last two fiscal years.

Employees

The Company has no employees. Neither of the Company's executive officers are employed by the Company. Management services are provided on an "as needed" basis. The Company has no oral or written contracts for services with any member of management.

Perceived Benefits

There are certain perceived benefits to being a reporting company with a class of publicly-traded securities. These are commonly thought to include the following:

the ability to use registered securities to make acquisitions of assets or businesses;

increased visibility in the financial community;

the facilitation of borrowing from financial institutions;

improved trading efficiency;

shareholder liquidity;

greater ease in subsequently raising capital;

compensation of key employees through stock options for which there may be a market valuation;

enhanced corporate image;

presence in the United States capital market.

Item 1A. Risk Factors

As a smaller reporting company, we are not required to provide the information required by this item.

Item 1B. Unresolved staff comments.

As a smaller reporting company, we are not required to provide the information required by this item. However, there are no unresolved staff comments as of the year ended December 31, 2008 or subsequently.

Item 2. Description of Properties

We currently own no properties. The Company leased furnished office space from our President, Andrew Ippolito for $1,300 per month through December 31, 2006. The lease expired and has not been renewed.

Oil and gas interests

In April of 1984, the Company purchased a non-operating working interest in six producing oil wells near the city of Signal Hill, California. The working interest granted the Company a 12.5% working interest, or a 9.32% net revenue interest after underlying royalty payments, in the oil and gas produced and sold from each well. Said working interest was sold on August 12, 2004.

Discovery is actively seeking new investment opportunities.

Item 3. Legal Proceedings

None.

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

None.

PART II

The following table sets forth the range of high and low bid prices as reported by the Over the Counter Bulletin Board (OTCBB) for the periods indicated. The quotations reflect inter-dealer prices without retail mark-up, markdown, or commission, and may not necessarily represent actual transactions. Currently the stock is traded on the OTCBB under the symbol "DSCY.OB".

	HIGH	LOW
Quarter ended 3-31-2007	$0.0275	$0.0125
Quarter ended 6-30-2007	$0.0275	$0.02
Quarter ended 9-30-2007	$0.025	$0.0125
Quarter ended 12-31-2007	$0.02	$0.01
Quarter ended 3-31-2008	$0.0175	$0.0075
Quarter ended 6-30-2008	$0.0075	$0.005
Quarter ended 9-30-2008	$0.0175	$0.007
Quarter ended 12-31-2008	$0.0025	$0.025
At March 23, 2009	.0007	.0005

Currently, there are eight broker-dealers making a market on the Company’s common stock.

Holders.

The number of stockholders of record at March 23, 2009 was 5,894.

Dividends.

No dividends have been paid or declared during the last five years; and the registrant does not anticipate paying dividends on its common stock in the foreseeable future.

Securities Authorized for Issuance Under Equity Compensation Plans

The company does not have securities authorized for issuance under a equity compensation plan.

Purchases of Equity Securities by the Small Business Issuer and Affiliated Purchasers.

The company did not effect any repurchases of securities during the years ended December 2008 or 2007.

Recent Sales of Unregistered Securities; Use of Proceeds From Registered Securities:

During the period covered by this report the Company sold no equity securities that were registered under the Security Act of 1933, as amended.

Item 6. Selected Financial Data

As a smaller reporting company, we are not required to provide the information required by this item.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's discussion and analysis is intended to be read in conjunction with the Company's audited financial statements and notes thereto. The following statements may be forward-looking in nature and actual results may differ materially.

Plan of Operation

Since the sale of previous interests, Discovery Oil has no revenue and has become a shell company. The Company is currently search for a new investment opportunity in the oil industry, which would probably take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. No assurances can be made that we will be successful in locating and negotiating with any possible merger candidates.

The Company's major shareholders have undertaken to make funds available to the Company in amounts sufficient to enable us to satisfy our reporting and other obligations as a public Company, and to commence, on a limited basis, the process of investigating possible merger and acquisition candidates.

Given our lack of cash or other assets, Discovery Oil will be extremely limited in our attempts to locate potential business situations for investigation. We do not know when, or if, we may be able to locate investment opportunities or potential merger candidates. Business opportunities, if any arise, are expected to become available to the Company principally from the personal contacts of our officers and directors. Although the current focus of management is to find investment opportunities or merger candidates within the oil industry, we will also consider other ventures and reserve the right to evaluate and to enter into any type of business opportunity, in any stage of development, in any location.

We may seek a business opportunity with a firm which only recently commenced operations, or a developing company in need of additional funds for expansion into new products or markets, an entity seeking to develop a new product or service, or an established business which may be experiencing financial or operating difficulties and is in need of additional capital which is perceived to be easier to raise by a public company. In some instances, a business opportunity may involve the acquisition or merger with a corporation which does not need substantial additional cash but which desires to establish a public trading market for its common stock.

We may purchase assets and establish wholly owned subsidiaries in various businesses or purchase existing businesses as subsidiaries. We anticipate that the selection of a business opportunity in which to participate will be complex and extremely risky. Because of general economic conditions, rapid technological advances being made in some industries, and shortages of available capital, management believes that there are numerous firms seeking the benefits of a publicly traded corporation. Such perceived benefits of a publicly traded corporation may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for the principals of a business, creating a means for providing incentive stock options or similar benefits to key employees, providing liquidity (subject to restrictions of applicable statutes) for all shareholders, and other factors. Potentially available business opportunities may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex. At the present time, management does not anticipate paying any finder's fee for locating an acquisition prospect.

As part of our investigation of acquisition possibilities, we may meet with executive officers of the business and its personnel, inspect its facilities, obtain independent analysis or verification of the information provided and conduct other reasonable measures, to the extent permitted by the Company's limited resources and management's limited expertise. Generally, we intend to analyze and make a determination based upon all available information without reliance upon any single factor as controlling. We can give no assurance that we will be able to find suitable a suitable business opportunity which may desire to combine with Discovery Oil.

Results of Operations

For the year ended December 31, 2008, compared to the year ended December 31, 2007.

The Company reported a net loss of $59,828 for the year ended December 31, 2008, compared to a net loss of $51,982 for the year ended December 31, 2007. Revenues were $0 in both years.

Financial Condition and Liquidity

Total assets at December 31, 2008 were $3,371, stockholder's deficit was $291,439, and the accumulated deficit was $1,219,261. Net loss from operations was $45,740 during the year ended December 31, 2008. The majority of the cash was expended for normal company operations as well as the continuing search for new investment opportunities.

The Company's liabilities increased to $294,810 at December 31, 2008 compared to $237,498 at December 31, 2008, primarily due to an increase in a related party payable.

The Company plans to fund its operations during fiscal year 2009 through advances from related parties, and possibly through the sale of the Company's common stock, although there can be no assurance that the Company would be successful in selling its common stock. It is anticipated that any revenue in 2009 would be negligible as the Company has yet to locate a new investment opportunity.

Off Balance-Sheet Arrangements

During the 12 months ended December 31, 2008, the Company did not engage in any off-balance sheet arrangements as defined in Item 303(c) of the SEC's Regulation S-B.

Contractual Obligations

None.

Inflation

We do not believe that inflation has had a significant impact on our results of operations or financial condition.

Critical Accounting Policies

We have identified our critical accounting policies, the application of which may materially affect the financial statements, either because of the significance of the financials statement item to which they relate, or because they require management’s judgment in making estimates and assumptions in measuring, at a specific point in time, events which will be settled in the future.

Estimates

The process of preparing financial statements in conformity with accounting principles generally accepted in the United States of America requires the use of estimates and assumptions regarding certain types of assets, liabilities, revenues, and expenses. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Accordingly, upon settlement, actual results may differ from estimated amounts.

Fair Value of Financial Instruments

The Company's financial instruments as defined by Statement of Financial Accounting Standards No. 107, "Disclosures about Fair Value of Financial Instruments," include cash, trade accounts receivable, accounts payable and related party payables. All instruments are accounted for on a historical cost basis, which, due to the short maturity of these financial instruments, approximates fair value at December 31, 2008 and 2007.

Significant Equipment Purchases and Requirements

None.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

As a smaller reporting company, we are not required to provide the information required by this item.

Item 8. Financial Statements and Supplementary Data

[discovery10k2008002.gif]

DISCOVERY OIL, LTD.
BALANCE SHEETS

					December 31,		December 31,
					2008		2007
ASSETS

	CURRENT ASSETS
		Cash		$	3,135	$	1,920
		Prepaid expenses			-		3,500
			Total Current Assets		3,135		5,420

	PROPERTY AND EQUIPMENT, NET OF DEPRECIATION				236		467

	TOTAL ASSETS			$	3,371	$	5,887

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

	CURRENT LIABILITIES
		Accounts payable		$	95,431	$	84,996
		Related party payable			157,873		113,768
		Advances payable			7,000		7,000
		Accrued expense			845		165
		State tax liability			33,661		31,569
			Total Current Liabilities		294,810		237,498

	COMMITMENTS AND CONTINGENCIES				-		-

	STOCKHOLDERS' (DEFICIT)
		Common stock, $0.001 par value;
			200,000,000 shares authorized,
			25,245,921 shares issued and outstanding, respectively		25,247		25,247
		Additional paid-in capital			902,575		902,575
		Accumulated deficit			(1,219,261)		(1,159,433)
			Total Stockholders' (Deficit)		(291,439)		(231,611)

	TOTAL LIABILITIES AND
		STOCKHOLDERS' (DEFICIT)		$	3,371	$	5,887

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

DISCOVERY OIL, LTD.
STATEMENTS OF OPERATIONS

				Years Ended
				December 31,		December 31,
				2008		2007

REVENUES
	Royalty income		$	-	$	-

OPERATING EXPENSES
	State tax expense			2,093		3,398
	Legal and accounting			30,625		24,539
	Stock transfer expense			8,159		8,339
	General and administrative expenses			4,863		5,643
		Total operating expenses		45,740		41,919

LOSS FROM OPERATIONS				(45,740)		(41,919)

OTHER INCOME (EXPENSES)
	Other income			-		200
	Interest income			-		464
	Interest expense			(14,088)		(10,727)
		TOTAL OTHER INCOME (EXPENSES)		(14,088)		(10,063)

LOSS BEFORE TAXES				(59,828)		(51,982)

INCOME TAX EXPENSE				-		-

NET LOSS			$	(59,828)	$	(51,982)

NET LOSS PER COMMON SHARE,
	BASIC AND DILUTED		$	nil	$	nil

WEIGHTED AVERAGE NUMBER
	OF COMMON SHARES OUTSTANDING,
	BASIC AND DILUTED			25,245,921		25,245,921

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

DISCOVERY OIL, LTD.
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

						Additional				Total
		Common Stock				Paid-in		Accumulated		Stockholders'
		Shares		Amount		Capital		Deficit		Equity (Deficit)


Balance December 31, 2006		25,245,921	$	25,247	$	902,575	$	(1,107,451)	$	(179,629)

Net loss for the year ended
	December 31, 2007	-		-		-		(51,982)		(51,982)

Balance December 31, 2007		25,245,921		25,247		902,575		(1,159,433)		(231,611)


Net loss for the period ended
	December 31, 2008							(59,828)		(59,828)

Balance December 31, 2008		25,245,921	$	25,247	$	902,575	$	(1,219,261)	$	(291,439)

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

DISCOVERY OIL, LTD.
STATEMENTS OF CASH FLOWS

				Years Ended
				December 31,		December 31,
				2008		2007


CASH FLOWS FROM OPERATING ACTIVITIES:
	Net gain (loss)		$	(59,828)	$	(51,982)
	Adjustments to reconcile net loss to net cash
	provided (used) by operating activities:
		Depreciation		231		311
		Accounts payable		10,434		26,704
		Prepaid expenses		3,500		(3,500)
		Accrued expense		680		165
		State tax liability		2,093		3,399
		Net cash provided (used) by operating activities		(42,890)		(24,903)

CASH FLOWS PROVIDED BY INVESTING ACTIVITIES:
				-		-
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
		Related party payable proceeds		44,105		25,500
		Net cash provided by financing activities		44,105		25,500

	Net increase (decrease) in cash and cash equivalents			1,215		597

Cash at beginning of period				1,920		1,323

Cash at end of period			$	3,135	$	1,920
				-

SUPPLEMENTAL CASH FLOW DISCLOSURES:
	Income taxes paid		$	-	$	-
	Interest paid		$	-	$	-

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

DISCOVERY OIL, LTD.

Notes to Financial Statements

DECEMBER 31, 2008 and 2007

NOTE 1 – DESCRIPTION OF BUSINESS

Discovery Oil, Ltd. (hereinafter “the Company”) was originally organized in the State of Wyoming in 1964 and became a Delaware corporation through a merger with a wholly owned subsidiary in 1981. Prior to 1992, the Company was involved as a general partner in several limited partnerships for the purpose of drilling oil and gas wells in Ohio, Wyoming, Colorado, Kansas and Texas. On August 12, 2004, the Company sold all of its 12.5% non-operating working interest in six oil wells for $62,850.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies is presented to assist in understanding the financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Accounting Methods

The Company’s financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

Accounting Pronouncements

In May, 2008, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 163, “Accounting for Financial Guarantee Insurance Contracts—an interpretation of FASB Statement No. 60” (SFAS 163). This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements. This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years, except for some disclosures about the insurance enterprise’s risk-management activities. This Statement requires that disclosures about the risk-management activities of the insurance enterprise be effective for the first period (including interim periods) beginning after issuance of this Statement. Except for those disclosures, earlier application is not permitted. The adoption of this statement will have no material effect on the Company’s financial condition or results of operations.

In May, 2008, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 162, “The Heirarchy of Generally Accepted Accounting Principles” (SFAS No. 162). This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). The sources of accounting principles1 that are generally accepted are categorized in descending order of authority as follows:

DISCOVERY OIL, LTD.

Notes to Financial Statements

DECEMBER 31, 2008 and 2007

a. FASB Statements of Financial Accounting Standards and Interpretations, FASB Statement 133 Implementation Issues, FASB Staff Positions, and American Institute of Certified Public Accountants (AICPA) Accounting Research Bulletins and Accounting Principles Board Opinions that are not superseded by actions of the FASB

b. FASB Technical Bulletins and, if cleared by the FASB, AICPA Industry Audit and Accounting Guides and Statements of Position

c. AICPA Accounting Standards Executive Committee Practice Bulletins that have been cleared by the FASB, consensus positions of the FASB Emerging Issues Task Force (EITF), and the Topics discussed in Appendix D of EITF Abstracts (EITF D-Topics)

d. Implementation guides (Q&As) published by the FASB staff, AICPA Accounting Interpretations, AICPA Industry Audit and Accounting Guides and Statements of Position not cleared by the FASB, and practices that are widely recognized and prevalent either generally or in the industry.

The adoption of this statement will have no material effect on the Company’s financial condition or results of operations.

In March 2008, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133” (SFAS No. 161). This statement changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. This Statement is intended to enhance the current disclosure framework in Statement 133. The Statement requires that objectives for using derivative instruments be disclosed in terms of underlying risk and accounting designation. This disclosure better conveys the purpose of derivative use in terms of the risks that the entity is intending to manage. Disclosing the fair values of derivative instruments and their gains and losses in a tabular format should provide a more complete picture of the location in an entity’s financial statements of both the derivative positions existing at period end and the effect of using derivatives during the reporting period. Disclosing information about credit-risk-related contingent features should provide information on the potential effect on an entity’s liquidity from using derivatives. Finally, this Statement requires cross-referencing within the footnotes, which should help users of financial statements locate important information about derivative instruments. The adoption of this statement will have no material effect on the Company’s financial condition or results of operations.

Cash and Cash Equivalents

For purposes of the statements of cash flows, the Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

DISCOVERY OIL, LTD.

Notes to Financial Statements

DECEMBER 31, 2008 and 2007

Derivative Instruments

The Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities” (SFAS No. 133), as amended by SFAS No. 137, “Accounting for Derivative Instruments and Hedging Activities – Deferral of the Effective Date of FASB No. 133”, and SFAS No. 138, “Accounting for Certain Derivative Instruments and Certain Hedging Activities”, and SFAS No. 149, “Amendment of Statement 133 on Derivative Instruments and Hedging Activities”. These statements establish accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. They require that an entity recognize all derivatives as either assets or liabilities in the balance sheet and measure those instruments at fair value.

If certain conditions are met, a derivative may be specifically designated as a hedge, the objective of which is to match the timing of gain or loss recognition on the hedging derivative with the recognition of (i) the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk or (ii) the earnings effect of the hedged forecasted transaction. For a derivative not designated as a hedging instrument, the gain or loss is recognized in income in the period of change.

Historically, the Company has not entered into derivatives contracts to hedge existing risks or for speculative purposes.

At December 31, 2008, the Company has not engaged in any transactions that would be considered derivative instruments or hedging activities.

Earnings (Loss) Per Share

On January 1, 1998, the Company adopted Statement of Financial Accounting Standards No. 128, which provides for calculation of "basic" and "diluted" earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity similar to fully diluted earnings per share. The Company had no outstanding options or warrants at December 31, 2008 and 2007; accordingly, only basic earnings (loss) are presented.

Estimates

Fair Value of Financial Instruments

DISCOVERY OIL, LTD.

Notes to Financial Statements

DECEMBER 31, 2008 and 2007

SFAS No. 157, “Fair Value Measurements(“SFAS 157), define fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1. Observable inputs such as quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date. The Company has no Level 1 assets or liabilities; and

Level 2. Inputs from other than quoted prices in active markets, that are observable either directly or indirectly. The Company has no Level 2 assets or liabilities; and

Level 3. Unobservable inputs in which there is little of no market data, which require the reporting entity to develop its own assumptions. The Company has no Level 3 assets or liabilities.

The Company has not applied the provisions of SFAS No. 157 to non-financial assets and liabilities that are of a nonrecurring nature in accordance with FASB Staff Position (FSP) Financial Accounting Standard 157-2, Effective Date of FASB Statement No. 157 (FSP 157-2). FSP 157-2 delayed the effective date of application of SFAS 157 to non-financial assets and liabilities that are of a nonrecurring nature until January 1, 2009. FSP 157-2 will not have a material effect on the Company’s financial position, results of operations and cash flows.

Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has limited cash, negative working capital, and has suffered material recurring losses from operations since inception. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management estimates that the Company will need to raise an additional $60,000 to continue operations for the upcoming year.

The Company’s management is currently exploring new business opportunities, which will, if successful, mitigate these factors that raise substantial doubt about the Company’s ability to continue as a going concern.

The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

Provision for Taxes

Income taxes are provided based upon the liability method of accounting pursuant to Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes.” Under this approach, deferred income taxes are recorded to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end. A valuation allowance is recorded against deferred tax assets if management does not believe the Company has met the “more likely than not” standard imposed by SFAS No. 109 to allow recognition of such an asset.

At December 31, 2008 and December 31, 2007, the Company had deferred tax assets calculated at an expected rate of 34% of approximately $414,500 and $387,000, respectively, principally arising from operating loss carryforwards for income tax purposes. As management of the Company cannot determine that it is more likely than not that the Company will realize the benefit of the deferred tax asset, a valuation allowance equal to the net deferred tax asset has been established at December 31, 2008. The significant components of the deferred tax asset at December 31, 2008 and 2007 were as follows:

DISCOVERY OIL, LTD.

Notes to Financial Statements

DECEMBER 31, 2008 and 2007


		December 31, 2008		December 31, 2007
Net operating loss carryforward	$	1,219,300	$	1,159,000

Deferred tax asset	$	414,500	$	394,000
Deferred tax asset valuation allowance	$	(414,500)	$	(394,000)

At December 31, 2008 and December 31, 2007, the Company has net operating loss carryforwards of approximately $1,219,300 and $1,159,000 respectively, which expire in the years 2021 through 2027. Utilization of the net operating losses is contingent upon the Company’s filing of federal income tax returns, currently in arrears. See Note 4 regarding Company’s liability for state income tax reporting. The Company’s valuation allowance increased $20,500 from December 31, 2007 to December 31, 2008.

Effective November 1, 2007, the Company adopted the Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes. FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Additionally, FIN 48 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The adoption of FIN 48 did not have a material impact on the Company’s financial position, results of operation or liquidity.

The current company policy is to recognize accrued interest and penalties related to uncertain tax positions as a component of income tax expense. The Company files income tax returns in the U.S. federal jurisdiction and in various state jurisdictions. The statue of limitations remains open for U.S. and certain state income tax examinations for tax years from 1991 and forward, due to non filing. State Income tax expense for the year ended December 31, 2008 includes $20,061 in interest and penalties. As of December 31, 2008, we have no accrued interest and penalties related to uncertain tax positions. As of December 31, 2008, we do not expect our unrecognized tax benefits to change significantly over the next 12 months. As a result of the adoption of FIN 48, we did not recognize any adjustment to the liability for uncertain tax position and therefore did not record any adjustment to the beginning balance of accumulated deficit on the consolidated balance sheet.

NOTE 3 - STOCKHOLDERS' DEFICIT

Common Stock

The Company has one class of issued and outstanding common stock. Prior to 2001, the par value of the common stock was $0.01, and 25 million shares were authorized for issue. Pursuant to a majority shareholders meeting held in August 2001, the Company's Certificate of Incorporation was amended to increase the number of shares of common stock authorized for issue to 200 million shares, to decrease the par value of the Company's common stock to $0.001 per share and to eliminate the provision authorizing preferred stock of the Company.

In the year ended December 31, 2007, the Company issued no stock.

In the year ended December 31, 2008, the Company issued no stock.

DISCOVERY OIL, LTD.

Notes to Financial Statements

DECEMBER 31, 2008 and 2007

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Depreciation is provided using the accelerated balance method over the estimated useful lives of the assets. The useful lives of property, plant and equipment for purposes of computing depreciation are five to forty years. The following is a summary of property, equipment, and accumulated depreciation:

	December 31, 2008	December 31, 2007
Office equipment	2,037	2,037
Total assets	2,037	2,037
Less accumulated depreciation	(1,801)	(1,570)
Total Net Equipment	$ 236	$ 467

Depreciation and amortization expense for the year ended December 31, 2008 was $231. The Company evaluates the recoverability of property and equipment when events and circumstances indicate that such assets might be impaired. The Company determines impairment by comparing the undiscounted future cash flows estimated to be generated by these assets to their respective carrying amounts. The cost and related reserves of assets sold or retired are removed from the accounts, and any resulting gain or loss is reflected in results of operations.

NOTE 5– STATE TAX LIABILITY

For the year ended December 31, 2008 the Company estimated its California corporate tax liability to be $33,661. The Company has not filed a return with the State of California for several years and because of that the Company has been suspended from operating as a corporation in California. In order to revive its authorized corporation status in California, the Company must file all delinquent tax returns and pay all related California corporate income taxes, penalties and interest.

NOTE 6 – RELATED PARTY PAYABLE

The Company has a related party payable to its, president and director, for funds advanced on an unsecured and noninterest-bearing basis to the Company. The amount due to the president at December 31, 2008 and December 31, 2007 is $157,873 and $113,768, respectively.

NOTE 7 – ADVANCES PAYABLE

In the year ended December 31, 2004, the Company was loaned $7,000 from an unrelated party. This advance is uncollateralized, bears no interest and is payable upon demand. As of December 31, 2008, the outstanding balance remains unpaid.

Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure

None.

Item 9a. Controls and Procedures

Evaluation of Disclosure Controls and Procedures.

In connection with the preparation of this annual report on Form 10-K, an evaluation was carried out by the company’s management, with the participation of the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of Discovery Oil, Ltd.’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)) as of December 31, 2008. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.

During the evaluation of disclosure controls and procedures as of December 31, 2008, management identified material weaknesses in internal control over financial reporting, which management considers an integral component of disclosure controls and procedures. As a result of these material weaknesses, management concluded that the company’s disclosure controls and procedures were ineffective.

Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934, as amended, as a process designed by, or under the supervision of, a company’s principal executive and principal financial officers and effected by a company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

All internal control systems, no matter how well designed, have inherent limitations and 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 our company have been detected. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2008. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework. In the

course of the evaluation, management identified a material weakness in internal control over financial reporting.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

The material weakness identified is disclosed below:

Insufficient Knowledgeable and Competent Personnel in Key Positions. There are insufficient knowledgeable and competent personnel in key positions within the Company. Because Discovery Oil is a shell corporation, the Company has virtually no operations. The two Directors are the only individuals who remain involved with the Company, with the exception of the Company’s outside accountant providing bookkeeping services. The two Directors are not independent, and have insufficient technical and reporting expertise to provide adequate oversight of financial reporting. In addition, fundamental elements of an effective control environment were not present as of December 31, 2008, including independent oversight of management and financial reporting, a code of conduct or ethics, and controls to address the risk of management override. This deficiency led to identification by the auditors of required material adjustments to the financial statements.

Based on the material weakness described above, management concluded that, as of December 31, 2008, internal control over financial reporting was not effective.

This annual report does not include an attestation report of the company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the company’s registered public accounting pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report in this annual report.

We do not intend to remedy the material weakness identified, because the company has virtually no operations and is, at present, in existence for the purposes of a reverse merger, if a candidate should arise.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Item 9b. Other Events

None.

PART III

Item 10. Directors and Executive Officers of the Registrant

Name of Executive Officers and		Principal Occupation, Five-Year
Directors and Positions Held	Age	Business History and Directorships
Andrew V. Ippolito, President	77	Currently and for the past 30 years,
and Chairman of the Board of		Mr. Ippolito functioned as a
Directors		business executive, diplomat, Honorary Consul
		General of Liberia and General Secretary of the
		Los Angeles Consular Corps, representing more
		than 86 countries and providing access to
		international finance and trade markets. Current
		President and Chairman of the Board of Discovery
		Oil, LTD.

M. Jeanett Ippolito, Secretary	67	Mrs. Ippolito has been a real estate broker
		and a Director for over 20 years.

Identification of Certain Significant Employees

The company has no employees.

Family Relationships

Andrew Ippolito and M. Jeanette Ippolito are husband and wife. There are no other family relationships known to the Company.

Involvement in Certain Legal Proceedings

So far as the Company is aware, no Director or Executive Officer has been involved in any material legal proceedings during the past five years.

Audit Committee

Due to our inactivity, the Company has not established an Audit Committee and has no audit committee financial expert. When we resume active operations, the Board of Directors will review current requirements and establish an Audit Committee as soon as practicable.

Section 16(a) Beneficial Ownership Reporting Compliance.

Officers, Directors, and beneficial owners of 10% or more of the Registrant's Common Stock are required to file on a timely basis the reports required by section 16(a) of the Exchange Act based on a review of Forms 3, 4, and 5.

To the Company’s knowledge, the required Forms 3, 4, and 5 have been filed.

Code of Ethics

Due to the inactivity of the Company, the Board of Directors has not yet adopted a Code of Ethics other than such direction as is supplied in our by-laws, a copy of which is was filed with the Company’s Report on Form 10KSB on April 17, 2006 and is hereby incorporated by reference.

When we resume active operations, the Board of Directors will review current requirements and establish a Code of Ethics as soon as practicable.

Item 11. Executive Compensation

No executive officers received compensation of any kind during the fiscal year ended December 31, 2008.

	Annual Compensation				Long Term Compensation
(a)	(b)	( c)	(d)	(e)	(f)	(g)	(h)	(i)
Name and Principal Position	Year	Salary ($)	Bonus ($)	Other Annual Compensa- tion ($)	Restricted Stock Award ($)	Securities Underlying Options/ SARs	LTIP Payouts ($)	All Other Compensa- tion ($)
Andrew Ippolito President and Director	2008	0	0	0	0	0	0	0
M. Jeanett Ippolito Secretary and Director	2008	0	0	0	0	0	0	0

The following table sets forth information with respect to the executive officer listed above, concerning the grants of options and Stock Appreciation Rights ("SAR") during the fiscal year ended December 31, 2008:

Option/SAR Grants In Last Fiscal Year

Name	Number of Securities Underlying Options/SARs Granted (1)	Percent of Total Options/SARs Granted to Employees in Fiscal Year	Exercise or Base Price ($/Sh)	Expiration Date
Andrew Ippolito	0	0	0	0
M. Jeanette Ippolito	0	0	0	0

Exercise of Options:

The Company has no stock options outstanding.

Long-Term Incentives

The Company has no long term incentive plan at this time.

Compensation of Directors:

Directors are not compensated for their activity as directors. The Board of Directors is empowered to vote compensation to directors for their performance of duties to the Company. In addition, directors are reimbursed for their accountable expenses incurred in attending meetings and conducting their duties on behalf of the Company. No director received compensation for services during the year ended December 31, 2008.

There are no compensatory plans or arrangements for compensation of any Director in the event of his termination of office, resignation or retirement.

There is no employment agreement between the Company and our other executive officers. See Item 6, Plan of Operations, for additional discussion of the Company’s relationship with our officers and directors.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information regarding the beneficial ownership of shares of the Company’s common stock as of December 31, 2008 by:

each person who is known by us to beneficially own more than 5% of the Company’s issued and outstanding shares of common stock;

the Company’s named executive officers;

the Company’s directors; and

all of the Company’s executive officers and directors as a group.

Name of Shareholder	Amount and Nature of Beneficial Ownership	Percent of Class (1)
Directors and Executive Officers
Andrew V. Ippolito, President and Chairman of the Board	4,480,173	17.7%
M. Jeanett Ippolito, Secretary	2,500,000	9.9%
Andrew and Jeanett Ippolito	10,059,350	39.8%

All current executive officers and directors as a group	17,039,523	67.4%
5% or greater shareholders
CEDE & CO	2,859,155	11.4%
PO Box 222, Bowling Green Station
New York NY 10274

Andrew V. Ippolito, president and a director, and his wife M. Jeanett Ippolito, secretary and a director, collectively own 17,039,523 shares of the Registrant's common stock representing 67.4% of the total outstanding shares as of March 23, 2009.

The Company has no knowledge of any other arrangements, including any pledge by any person of the Company’s securities, the operation of which may at a subsequent date result in a change in control of the company.

The Company is not, to the best of its knowledge, directly or indirectly owned or controlled by another corporation or foreign government.

Changes in Control

There are no arrangements known to the Company the operation of which may at a subsequent time result in the change of control of the Company. We are presently engaged in a search for new investment or merger opportunities. Control of the Company may change in the event of a business re-organization resulting in the issuance of additional common stock or other voting securities of the Company.

At December 31, 2002, the Company had a related party payable to its president and director for funds advanced on an unsecured and noninterest-bearing basis to the Company. The amount due to the president at December 31, 2008 and December 31, 2007 is $157,873 and $113,768, respectively.

The Company signed a lease with its president for the use of office space for $1,300 per month, or $15,600 per year. The lease expired at December 31, 2006 and has not been renewed. The Company also agreed to pay mileage for his travels relating to the Company. During 2008 and 2007, the Company accrued $0 for rent, travel, general and administrative expenses.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The Company’s board of directors reviews and approves audit and permissible non-audit services performed by the authorized independent public accountants as well as the fees charged by the authorized independent public accountants for such services. In its review of non-audit service fees and its appointment of the authorized independent public accountants as the Company's independent accountants, the board of directors considered whether the provision of such services is compatible with maintaining the authorized independent public accountants independence. All of the services provided and fees charged by the authorized independent public accountants in 2005 were pre-approved by the board of directors.

Audit Fees

The aggregate fees billed by the authorized independent public accountants for professional services for the audit of the annual financial statements of the Company and the reviews of the financial statements included in the Company's quarterly reports on Form 10-Q for 2008 and 2007 were $27,689 and $27,776 respectively, net of expenses.

Audit-Related Fees

There were no other fees billed by the authorized independent public accountants during the last two fiscal years for assurance and related services that were reasonably related to the performance of the audit or review of the Company's financial statements and not reported under "Audit Fees" above.

Tax Fees

The aggregate fees billed by the authorized independent public accountants during the last two fiscal years for professional services rendered by the authorized independent public accountants for tax compliance for 2008 and 2007 were $0 and $0, respectively.

All Other Fees

There were no other fees billed by the authorized independent public accountants during the last two fiscal years for products and services provided by authorized independent public accountants.

Item 15. Exhibits

Exhibit Number		Description
3.1		Amended Articles of Incorporation*
3.2		By-laws*
10.1		Lease Agreement*
31		Rule 13a-14(a)/15d-14(a) Certifications
		(31)(i) Certification of Andrew V. Ippolito
		(31)(ii) Certification of M. Jeanett Ippolito
32		Section 1350 Certifications
		(32)(i) Certification of Andrew V. Ippolito
		(32)(ii) Certification of M. Jeanett Ippolito

		*Incorporated by reference to Form 10KSB filed April 17, 2006

SIGNATURES

Pursuant to the requirements of Section 143 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf of the undersigned, thereunto duly authorized.

DISCOVERY OIL, LTD.

/s/ Andrew V. Ippolito

By __________________________________

Andrew V. Ippolito

President, Chairman of the Board

Date: March 31, 2009

Pursuant to the requirements of the Securities Act of 1934 this report signed below by the following person on behalf of the Registrant and in the capacities on the date indicated.

/s/ M. Jeanett Ippolito

By ____________________________________

M. Jeanett Ippolito

Secretary

Date: March 31, 2009

DISCOVERY OIL LTD 10-K