UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10 – Q

(Mark One)

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

For the quarterly period ended March 31, 2010

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ________________

Commission file number: 000-52782

Southfield Energy Corporation

(Exact name of registrant as specified in its charter)

Nevada		20-5361270
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

1240 Blalock Rd., Suite 150

Houston, Texas 77005

(Address of principal executive offices)

(713) 266-3700

(Registrant’s telephone number, including area code)

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 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” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one).

Large accelerated filer ¨	Accelerated filer ¨

Non-accelerated filer ¨	Smaller reporting company x
(Do not check if a smaller reporting company)

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

As of May 14, 2010 there were 7,410,000 shares of the issuer’s common stock, par value $0.001, outstanding.

SOUTHFIELD ENERGY

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2010

TABLE OF CONTENTS

		PAGE

	Special Note Regarding Forward Looking Information	2

	PART I - FINANCIAL INFORMATION

Item 1.	Unaudited Financial Statements	3

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21

Item 4T.	Controls and Procedures	21

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	22

Item 1A.	Risk Factors	22

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31

Item 3.	Defaults Upon Senior Securities	31

Item 4.	Submission of Matter to a Vote of Security Holders	31

Item 5.	Other Information	31

Item 6.	Exhibits	31

	SIGNATURES	32

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

To the extent that the information presented in this Quarterly Report on Form 10-Q for the quarter ended March 31, 2010 discusses financial projections, information or expectations about our products or markets, or otherwise makes statements about future events, such statements are forward-looking. We are making these forward-looking statements in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These risks and uncertainties are described, among other places in this Quarterly Report, in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.

In addition, we disclaim any obligations to update any forward-looking statements to reflect events or circumstances after the date of this Quarterly Report. When considering such forward-looking statements, you should keep in mind the risks referenced above and the other cautionary statements in this Quarterly Report.

PART 1 – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

	PAGE

Unaudited Balance Sheets as of March, 31 2010 and December 31, 2009	4

Unaudited Statements of Operations for the three months ended March 31, 2010 and 2009	5

Unaudited Statements of Cash Flows for the three months ended March 31, 2010 and 2009	6

Unaudited Statement of Stockholders’ Deficit	7

Notes to Unaudited Financial Statements	8

SOUTHFIELD ENERGY CORPORATION

BALANCE SHEETS

As of March 31, 2010 and December 31, 2009

(Unaudited)

	March			December
	31, 2010			31, 2009
ASSETS
Current Assets:
Cash	$	8,819		$	68,826
Accounts Receivable		13,548			13,006

TOTAL CURRENT ASSETS		22,367			81,832

Property & Equipment:
Oil & Gas, on the basis of successful efforts accounting
Gross Proved Properties		346,199			346,199
Less: Accumulated Depletion and Depreciation		(89,679	)		(85,179	)
Net Proved Properties		256,520			261,020

Other Long Term Assets:
Gross Capitalized Loan and Convertible Debenture Costs		416,852			413,002
Less: Accumulated Amortization		(314,567	)		(284,942	)
Net Capitalized Loan and Convertible Debenture Costs		102,285			128,060

Available for Sale Securities		-			345,595
Less: Valuation Allowance		-			(279,345	)
Net (market value)		-			66,250

TOTAL ASSETS	$	381,172		$	537,162

LIABILITIES AND STOCKHOLDERS' DEFICIT

LIABILITIES:
Current Liabilities:
Accounts Payable	$	93,134		$	72,272
Accrued interest on Convertible Debentures		219,520			198,649
Current portion of Convertible Debentures Payable		224,000			190,000
Short term notes payable to related parties		3,900			-
TOTAL CURRENT LIABILITIES		540,554			460,921

Long Term Liabilities:
Convertible Debentures Payable		1,656,000			1,684,000
TOTAL LONG TERM LIABILITIES		1,656,000			1,684,000

TOTAL LIABILITIES		2,196,554			2,144,921

STOCKHOLDERS' DEFICIT:
Common stock, $0.001 par value; 50,000,000 shares
authorized, 7,410,000 and 7,410,000 issued and
outstanding at 3/31/10 and 12/31/09, respectively		7,410			7,410
Additional Paid-in Capital		99,373			99,373
Deficit accumulated during the development stage		(24,718	)		(24,718	)
Accumulated deficit		(1,897,447	)		(1,689,824	)

TOTAL STOCKHOLDERS' DEFICIT		(1,815,382	)		(1,607,759	)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	381,172		$	537,162

*See accompanying notes to the financial statements.

SOUTHFIELD ENERGY CORPORATION

STATEMENTS OF OPERATIONS

For the three months ended March 31, 2010 and 2009

(Unaudited)

	March			March
	31, 2010			31, 2009

REVENUES:

Oil and Gas Production	$	25,368		$	12,568

EXPENSES:
Production Costs		3,610			7,671
Severance & Ad Valorem		1,789			1,390
DD&A		4,500			8,549
Unsuccessful Exploration Costs		-			30,933
Amortization of Loan and Convertible Debenture Costs		29,625			31,346
General and Administrative Expenses		141,504			103,464
TOTAL OPERATING EXPENSES		181,028			183,353

OPERATING LOSS		(155,660	)		(170,785	)

Other Income (Expense)
Interest Income		3			69
Loss on Sale of Securities		(654	)		-
Interest Expense		(51,312	)		(42,358	)
Total Other Expenses		(51,963	)		(42,289	)

Net loss from continuing operations	$	(207,623	)	$	(213,074	)

Net income from discontinued operations	$	-		$	2,124

Net Loss	$	(207,623	)	$	(210,950	)

Other Comprehensive Loss:
Unrealized loss on available for sale securities		-			(126,000	)

Total Comprehensive Loss	$	(207,623	)	$	(336,950	)

Weighted average common shares outstanding		7,410,000			7,410,000

Net Loss per common share from continuing operations (Basic & Diluted)	$	(0.03	)	$	(0.03	)

Net Income per common share from discontinued operations (Basic & Diluted)	$	0.00		$	0.00

Basic and diluted net loss per common share	$	(0.03	)	$	(0.03	)

*See accompanying notes to the financial statements.

SOUTHFIELD ENERGY CORPORATION

STATEMENTS OF CASH FLOWS

For the three months ended March 31, 2010 and 2009

(Unaudited)

	March			March
	31, 2010			31, 2009

Cash Flows From Operating Activities
Net loss from continuing operations	$	(207,623	)	$	(213,074	)
Net income from discontinued operations		-			2,124
Net loss		(207,623	)		(210,950	)

Adjustments to reconcile net loss to net cash used by
by operating activities
Loss on sale of AFS - Securities		654			-
Amortization of Loan & Convertible Debenture Costs		29,625			31,346
Depreciation, Depletion and Amortization		4,500			11,931
Changes in operating assets and liabilities:
A/P and Accrued expenses		41,733			22,974
Receivables		(542	)		45,492
Prepaid Expenses		-			30,933
Net cash used by operating activities	$	(131,653	)	$	(68,274	)

Cash Flows From Investing Activities
Capitalized Investment in Proved Leaseholds		-			(76,035	)
Sale of AFS - Securities		65,596			-
Net cash (used) provided by investing activities	$	65,596		$	(76,035	)

Cash Flows From Financing Activities
Deferred financing costs		(3,850	)		(33,932	)
Convertible Debentures Payable		35,000			240,000
Repayment of Convertible Debentures Payable		(29,000	)		-
Short term notes payable		3,900			-
Net cash provided from financing activities	$	6,050		$	206,068

Net change in cash		(60,007	)		61,759
Cash, beginning of period		68,826			123,104
Cash, end of period	$	8,819		$	184,863

Supplemental disclosure of non-cash items:
Unrealized loss on available for sale securities	$	-		$	(126,000	)

Income taxes paid in cash	$	-		$	-
Interest expense paid in cash	$	23,542		$	20,439

*See accompanying notes to the financial statements.

SOUTHFIELD ENERGY CORPORATION

STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT

For the three months ended March 31, 2010

(Unaudited)

							Deficit
							Accumulated						Accumulated
							During						Other
	Common Stock						Development			Accumulated			Comprehensive
	Shares		Amount		APIC		Stage			Deficit			Income		Total
Balance December 31, 2009		7,410,000	$	7,410	$	99,373	$	(24,718	)	$	(1,689,824	)	$	-	$	(1,607,759	)

Net Loss		-		-		-		-			(207,623	)		-		(207,623	)

Balance March 31, 2010		7,410,000	$	7,410	$	99,373	$	(24,718	)	$	(1,897,447	)	$	-	$	(1,815,382	)

*See accompanying notes to the financial statements.

SOUTHFIELD ENERGY CORPORATION

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – Nature of Operations

SOUTHFIELD ENERGY CORPORATION (the "Company" or “Southfield”), is an oil and gas investment company. It invests in the exploration, development, and production of oil & gas in the United States. The focus of its activity is in Texas, Louisiana, and Oklahoma. The Company intends to invest its funds primarily as a working interest owner, royalty interest owner or mineral lease owner. Generally, the Company will be a minority owner in each well. The Company expects most of its investments to range from 5-25% of the total investment required for any given project, and anticipates that its investment in each project will range from $50,000 to $250,000.

NOTE 2 – Basis of Presentation

The accompanying unaudited financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission, and U.S. GAAP. The information furnished for the three months ended March 31, 2010 includes normal recurring adjustments and reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of such financial statements.

Because the Aldwell Unit was sold with an effective date of September 1, 2009, the accompanying unaudited financial statements for the three months ended March 31, 2010 and March 31, 2009 have been presented with the financial results from the Aldwell Unit in discontinued operations. All of the revenues and expenses associated with the Aldwell Unit prior to September 1, 2009 were part of our continuing operations at the time. However, subsequent to the sale, we separated the financial results of the Aldwell Unit from the continuing operations in 2009 and reclassified them into discontinued operations so that the impact of the sale of the Aldwell Unit can be compared across periods. All assets and liabilities of the Aldwell Unit have also been segregated from continuing operations on the balance sheet as of December 31, 2009.

The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on its results of operation, financial position or cash flow.

NOTE 3 – Reclassification

Certain items from the March 31, 2009 statements of operations have been reclassified to conform with the three months ended March 31, 2010 financial statement presentation. There is no effect on net income, cash flows or stockholders’ equity as a result of these reclassifications.

NOTE 4 – Going Concern

These financial statements have been prepared on a going concern basis and do not include any adjustments to the measurement and classification of the recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company has experienced losses and incurred negative cash flows from operations since inception. The Company’s ability to realize its assets and discharge its liabilities in the normal course of business is dependent upon continued support. The Company is currently attempting to obtain additional financing through its offering of three year notes to continue its operations. In order to raise additional equity capital, the Company has also registered its equity and is pursuing quotation of its common stock on the OTC Bulletin Board. However, there can be no assurance that the Company will obtain sufficient additional funds from these sources.

These conditions cause substantial doubt about the Company’s ability to continue as a going concern. A failure to continue as a going concern would require that stated amounts of assets and liabilities be reflected on a liquidation basis that could differ from the going concern basis.

NOTE 5 - Summary of Significant Accounting Policies

Oil and Gas Properties (Successful Efforts): The Company follows the successful efforts method of accounting for oil and gas property acquisition, exploration, development and production activities.

Capitalization Policies: Oil and gas property acquisition costs, exploration well costs, and development costs are capitalized as incurred. Net capitalized costs of unproved property and exploration well costs are reclassified as proved property and well costs when related proved reserves are found. If an exploration well is unsuccessful in finding proved reserves, the capitalized well costs are charged to exploration expense. Other exploration costs, including geological and geophysical costs and the costs of carrying unproved property are charged to exploration expense as incurred. Costs to operate and maintain wells and field equipment are expensed as incurred.

Sales and Retirement Policies: Gains and losses on the sale or abandonment of oil and gas properties are generally reflected in income. Costs of retired equipment, net of salvage value, are usually charged to accumulated amortization. As of March 31, 2010 and December 31, 2009, management has determined that the asset retirement obligation related to the plugging and abandonment of wells is immaterial individually and to the financial statements taken as a whole. As such, no asset retirement obligation is recorded in the statements presented. Management will review the potential obligation on an on-going basis and will record the obligation in the period it becomes material, either individually or in aggregate, to the financial statements.

Impairment Policies: Long-lived assets used in operations are assessed for impairment whenever changes in facts and circumstances indicate a possible significant deterioration in the future cash flows expected to be generated by an asset group. Oil and gas producing assets are evaluated for impairment at least annually at the end of every year. If, upon review, the sum of the undiscounted pretax cash flows are less than the carrying value of the asset group, the carrying value is written down to the estimated fair value. Individual assets are grouped for impairment purposes at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets – generally on a field-by-field basis. The fair value of impaired assets is determined based on quoted market prices in active markets, if available, or upon the present values of the expected future cash flows using discount rates commensurate with the risks involved in the asset group. Long-lived assets committed by management for disposal are accounted for at the lower of amortized cost or fair value less cost to sell.

Earnings Per Share: Southfield’s net income/loss per share has been calculated by dividing the net income/ loss for the period by the weighted average number of shares outstanding. Since all potentially dilutive securities would be considered anti-dilutive, the basic loss per share equals the fully diluted loss per share. Earnings per share from discontinued operations for the three months ended March 31, 2010 is $.00 and net loss per share from continuing operations for the three months ended March 31, 2010 is ($.03). For the three months ended March 31, 2009, net income per share for discontinued operations and net loss per share from continuing operations were $0.00 and ($0.03), respectively.

Deferred Financing Costs: Southfield incurred deferred financing costs in connection with raising capital through the sale of debentures. The costs have been capitalized as incurred and amortized over the three year life of the debentures using the effective interest method. The net costs capitalized as of December 31, 2009 are $128,060 and the net costs capitalized as of March 31, 2010 are $102,285.

Stock Based Compensation: On January 1, 2006, the Company adopted the FASB standard which requires the measurement and recognition of compensation expense for all share-based awards made to employees and directors, including employee stock options and shares issued through its employee stock purchase plan, based on estimated fair values. In March 2005, the Securities and Exchange Commission issued a bulletin related to the aforementioned FASB standard. The Company’s financial statements reflect the impact of this standard.

Fair Value of Financial Instruments: Southfield includes fair value information in the Notes to the Financial Statements when the fair value of its financial instruments can be determined and is different from the carrying amounts reflected in the accompanying statements. Southfield generally assumes that the carrying amounts of cash, accounts receivable, accounts payable, accrued expenses, short-term debt and long-term debt approximate fair value. For non-current financial instruments, Southfield uses quoted market prices or, to the extent that there are no available quoted market prices, market prices for similar instruments. Management believes that the carrying amounts of the financial instruments are fairly represented in the financial statements.

We adopted the Financial Accounting Standards Board’s (FASB) standard on fair value measurements at inception. The standard defines fair value, establishes a framework for measuring fair value and expands disclosure of fair value measurements. The standard applies under other accounting pronouncements that require or permit fair value measurements and accordingly, does not require any new fair value measurements. It clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the standard established 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;

¨	Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

¨	Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The following table presents assets that are measured and recognized at fair value as of December 31, 2009 and for the twelve months then ended on a recurring basis:

12/31/2009							Total
							Realized (Loss due to			Total Unrealized
Description	Level 1		Level 2		Level 3		valuation)			(Loss)
Available for Sale Securities	$	66,250	$	-	$	-	$	(279,345	)	$	-
Totals	$	66,250	$	-	$	-	$	(279,345	)	$	-

Due to the sale of all available for sale securities during the first quarter of 2010, the Company held no assets that required measurement and recognition at fair value on a recurring basis as of March 31, 2010.

Use of Estimates: The preparation of financial statements in conformity with accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Southfield’s most significant financial estimates are based on the valuation of remaining proved oil and gas reserves, impairment of its long-lived assets, valuation of its assets using successful efforts accounting, and revenue recognition. Because of the nature of these estimates and the nature of exploration, development and production of oil and gas reserves, actual results could differ from these estimates and losses and reductions in value could occur. These possible losses and reductions in values which have not been reflected in the accompanying financial statements could be material to the Company’s revenues/earnings or losses and stockholders’ deficit. Due to the nature of the Company’s business plan to acquire additional properties to explore for oil and gas reserves, additional losses and reductions in value of the Company may occur in the future both related to properties currently being developed and new properties not yet acquired and those amounts could be substantial with respect to the Company’s financial position and operations. To be successful, the Company must acquire properties that result in significant amounts of recoverable amounts of oil and gas reserves and be successful in the marketing of those reserves over a long period of time in order to pay its acquisition, development, production and operating costs, to cover its credit and debt obligations, and to provide a return to its shareholders.

Concentrations of Credit Risk: Financial instruments that may potentially subject the Company to concentration of risk in the future consist primarily of cash which will be placed with high credit quality financial institutions at amounts that may at times exceed FDIC limits.

Accounts Receivable: Accounts receivable represent the amounts due from the sale of oil and gas. Based on collections history and review of accounts receivable aging, management does not believe that any allowance for doubtful accounts is necessary as of March 31, 2010 or December 31, 2009.

Revenue Recognition: Southfield recognizes oil, gas and natural gas condensate revenue in the period of delivery. Settlement for oil sales occurs 30 days after the oil has been sold; and settlement for gas sales occurs 60 days after the gas has been sold. Southfield recognizes revenue when an arrangement exists, the product or service has been provided, the sales price is fixed or determinable, and collectability is reasonably assured.

Cash and Cash Equivalents: Southfield considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents at March 31, 2010 and December 31, 2009 were $8,819 and $68,826, respectively.

Investments: We account for securities available for sale in accordance with Financial Accounting Standards Board (“FASB”) guidance regarding accounting for certain investments in debt and equity securities, which requires that available-for-sale and trading securities be carried at fair value. Unrealized gains and losses deemed to be temporary on available-for-sale securities are reported as other comprehensive income (“OCI”) within stockholders’ deficit. Realized gains and losses and decline in value deemed to be other than temporary on available-for-sale securities are included in “(Gain) loss on short- and long-term investments” and “Other income” on our consolidated statements of operations. Trading gains and losses also are included in “(Gain) loss on short- and long-term investments.” Fair value of the securities is based upon quoted market prices in active markets or estimated fair value when quoted market prices are not available. The cost basis for realized gains and losses on available-for-sale securities is determined on a specific identification basis. We classify our securities available-for-sale as short- or long-term based upon management’s intent and ability to hold these investments. In addition, throughout 2009, the FASB issued various authoritative guidance and enhanced disclosures regarding fair value measurements and impairments of securities which helps in determining fair value when the volume and level of activity for the asset or liability have significantly decreased and identifying transactions that are not orderly.

Recent Accounting Pronouncements

On January 1, 2009, the FASB issued a new accounting standard related to the disclosure of derivative instruments and hedging activities. This standard expanded the disclosure requirements about an entity’s derivative financial instruments and hedging activities including qualitative disclosures about objectives and strategies for issuing derivatives, quantitative disclosures about fair value amounts of any gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments. Southfield had no instruments that fell within the scope of this pronouncement as of March 31, 2010.

Effective January 1, 2009, a new accounting standard was issued related to determining whether an instrument (or an embedded feature) is indexed to an entity’s own stock, which would qualify as a scope exception from hedge accounting. Southfield had no instruments that fell within the scope of this pronouncement as of March 31, 2010.

In August 2009, the FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective on October 1, 2009. Southfield had no instruments that fell within the scope of this pronouncement as of March 31, 2010.

In October 2009, the FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminates the use of the residual method for allocating arrangement consideration and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard, which Southfield is currently assessing the impact of, will become effective for the Company on January 1, 2011.

In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition accounting standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, which Southfield is currently assessing the impact of, will become effective for the Company on January 1, 2011.

NOTE 6 - Related Party Transactions

On March 24, 2010, Ben Roberts and Tyson Rohde each made loans to the Company for $1,300. The loans have been evidenced by short terms notes due in 90 days with no accompanying interest. No interest was imputed for these loans because the expense is immaterial to the financial statements. The loans are general obligations of the Company and do not contain any first liens on the Company’s assets or liquidation preferences.

The total rent expense for each of the three months ended March 31, 2010 and March 31, 2009 was $9,183. After taking into account comparable rents in the immediate area, the rent paid by Southfield is a fair market value.

NOTE 7 – Convertible Debentures Payable

We have retained the services of MMR Investment Bankers, Inc. to represent the Company in a Debenture offering of $10 million. We also engaged Sunflower Management Group, a third party administrator for interest payments and technical compliance with the repayment requirements of the Debentures that have been sold.

MMR Investment Bankers, Inc. has created an account to reserve from the gross offering proceeds the first six months of interest payments due to any investor. Sunflower Management Group is managing the interest reserve account and is responsible for accruing and funding interest to investors as it becomes due. As of March 31, 2010 and December 31, 2009, the Company has $1,880,000 and $1,874,000 of three-year convertible Debentures outstanding, respectively. The Debentures bear interest at a rate of 10% and mature three years from the date of purchase.

The investors may elect to have simple interest paid on a monthly basis, or may have the interest compounded semiannually and paid at maturity. The investors may convert the face value of the Debenture to common stock in the Company at any time during the term of the Debenture at a conversion price of $5.00 per share. The company has the right to call for the conversion of the Debentures when the common stock of the Company trades on a public market for twenty (20) consecutive days at a price higher than $7.50 per share and upon notice, unless the Debenture holder elects not to accept the conversion offer.

The Company reviewed accounting literature related to embedded derivatives and beneficial conversion features and its application to the Company’s convertible debentures. The Company concluded that there is not a derivative or beneficial conversion option associated with the debentures that is in-the-money and therefore the Company is not required to calculate the intrinsic value of such conversion option.

Maturities of the notes over the next five years for the twelve months ending March 31are as follows:

2011				2012				2013				2014				2015
$	224,000			$	674,000			$	580,000			$	317,000			$	85,000

NOTE 8 – Acquisitions & Capital Investments

In 2009, the Company successfully drilled the C-34 and C-35 wells located on the Mary King Estell Lease and invested approximately $61,395 and $61,916, respectively. The remainder of the capital investment in proved leaseholds was in the Aldwell Unit for roughly $5,785. This capital investment was used to drill and complete new wells and to recomplete existing production wells to enhance production in the field. The Company did not make any capital investments in oil and gas projects in the first quarter of 2010.

NOTE 9 – Available for Sale Securities

In 2008 the Company invested approximately $510,000 in the common stock of Meridian Resources, a publicly traded exploration and production company on the New York Stock Exchange listed under the symbol TMR. As of December 31, 2008 the value of the stock declined significantly consistent with the overall stock market at that time. As of December 31, 2009, the Company determined the decline in the value of the stock to be other than temporary according to the applicable SEC Staff Accounting Bulletin. Due to this determination, the difference between the cost of the securities and the market value was recorded as a loss on the income statement for the twelve months ended December 31, 2009, rather than in other comprehensive income. The impairment expense was $279,345 for the twelve months ended December 31, 2009.

On January 4, 2010, we sold our remaining 250,000 shares of common stock in Meridian Resources Corporation and realized an approximate loss of $654 based on an average cost basis. We no longer have an equity investment in Meridian Resources or any other corporation. We do not have any current plans, proposals or arrangements, written or otherwise, to make any equity investment in Meridian Resources Corporation or any other company.

NOTE 10 – Discontinued Operations

On August 12, 2009, the Company sold its interest in the Aldwell Unit to the operator of the unit, Mariner Energy Inc., for $300,000. Southfield divested the asset through an intermediary that charged the company 6% of the sales price to list the property, find qualified buyers and execute the sale. The effective date of the sale is September 1, 2009. The carrying amount of the Aldwell Unit at the time of the sale was $132,012 less depreciation, depletion, and amortization of $6,146. Revenue from the Aldwell Unit for the three months ended March 31, 2009 was $8,821. Net income from the Aldwell Unit for the three months ended March 31, 2009 was $2,124.

NOTE 11 – Non-cash Compensation

There have been no additional issuances of equity for the three months ended March 31, 2010.

NOTE 12 – Depletion and Depreciation

DD&A expense from continuing operations decreased from $8,549 to $4,500 during the three months ended March 31, 2009 and 2010, respectively. This was due to a decrease in our capitalized expenses in proved properties and a lower depletion rate of our production in 2010 as compared to 2009. Depreciation, depletion and amortization have been calculated using the units of production method.

NOTE 13 – Capitalized Expenses

The Company is capitalizing expenses related to the Debenture Offering and amortizing them over the three year life of the Debentures according to the effective interest method. The gross capitalized loan and debenture costs were $416,852 and $413,002 as of March 31, 2010 and December 31, 2009, respectively. The accumulated amortization was $314,567 and $284,942; and the net capitalized loan and debenture costs were $102,285 and $128,060 for the same periods respectively.

NOTE 14 – Impairment of Proved Properties

The Company analyzed its proved oil and gas properties located in the Mary King Estell lease as of December 31, 2009. The estimated undiscounted net cash flows provided in the December 31, 2009 reserve report was greater than the carrying value of the assets, therefore no impairment was necessary. An impairment analysis was not conducted as of March 31, 2010 as there were no impairment indicators to necessitate an analysis.

NOTE 15 – Commitments and Contingencies

Litigation

In the normal course of business, the Company may become subject to lawsuits and other claims and proceedings. Such matters are subject to uncertainty and outcomes are not predictable with assurance. Management is not aware of any pending or threatened lawsuits or proceedings which would have a material effect on the Company’s financial position, liquidity, or results of operations.

Concentrations

The Company’s sales are dependent upon the performance of its producing wells and our ability to successfully partner with high quality oil and gas operators; any impacts to this industry could have a significant impact to the Company. For the quarter ended March 31, 2010, the Mary King Estell represented 100% of the total revenues of the Company and 100% of the accounts receivable. The Company generally does not require collateral to support accounts receivable or financial instruments subject to credit risk.

NOTE 16 – Oil and Gas Properties

As of the date of this report and as of March 31, 2010, the Company owned non-operated working interests in five wells in the Mary King Estell Lease which is operated by Durango Resources. According to the reserve analysis conducted by Netherland, Sewell and Associates, Inc., and the Company’s estimate of future income taxes, the estimated discounted net cash flow after taxes was $457,500 as of December 31, 2009. Because of our significant net loss carryforward, we do not expect to pay any federal income taxes on future net revenues provided from our Mary King Estell production, and therefore the pre-tax and after-tax estimate of discounted future net cash flows are both $457,000.

NOTE 17 – Supplementary Financial Information on Oil and Natural Gas Exploration, Development and Production Activities (unaudited).

Summary of general presentation and assumptions used in our Reserve Analysis

As of March 31, 2010, the Company’s disclosure of supplementary financial information on oil and natural gas exploration, development, and production activities is consistent with that discussed in Note 17 of its financial statements contained in the annual report on Form 10-K for the fiscal year ended December 31, 2009.

NOTE 18 – Subsequent Events

On April 26, 2010 Ben Roberts, Tyson Rohde, and Goldbridge Consulting each made loans to the Company for $2,633. The loans have been evidenced by short term notes that mature 30 days from issuance with no accompanying interest.

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the financial statements and related notes included elsewhere in this disclosure. The following discussion and analysis contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the volatility of oil, NGL and gas prices, production timing and volumes, estimates of proved reserves, operating costs and capital expenditures, economic and competitive conditions, regulatory changes and other uncertainties, as well as those factors discussed below and elsewhere in this prospectus, particularly in “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements,” all of which are difficult to predict. As a result of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur.

Overview

Southfield Energy Corporation, a Nevada corporation formed in July 2005, is a Houston, Texas based company engaged in the investment in acquisition, exploration and development of moderate risk, oil and gas wells in the United States. The Company’s core strategy is to earn revenue from existing non-operated working interests while investing in new opportunities to increase our oil and gas production and reserves; primarily through acquisitions of existing production and working interest investments in drilling programs of experienced and successful oil and gas operators active in Texas, Louisiana and Oklahoma.

Recent Developments

Durango Resources

Since partnering with Durango Resources, we have participated in the drilling and completion of five commercially viable oil and gas wells on the Mary King Estell lease in the Richard King Field in Nueces County, Texas. All of the wells were drilled to depths less than 6,500 feet, and are currently producing natural gas at various rates. We have not made any unsuccessful investments in this field and have thus far completed all of the wells that we have drilled. These wells produce gas from the Frio formation and constitute all of our revenues. Our share of production from these wells was 5,970 barrels of oil equivalent in 2008 and 4,057 barrels of oil equivalent in 2009. We did not drill any new wells with Durango in the first quarter of 2010. However, Durango Resources has identified additional drilling locations that are adjacent to our current producing wells and has plans for additional drilling over the next twelve to twenty four months. We anticipate investing in additional wells with Durango should the opportunity arise.

Aldwell Unit

From January 1, 2009 through August 31, 2009 the pro rata portion of production net to our working interest from the Aldwell Unit was 792 barrels of oil equivalent. Effective September 2009, we sold our assets located in the Aldwell Unit to Mariner Energy, Inc., the operator, for approximately $300,000, excluding a six percent sales commission. The Aldwell Unit accounted for approximately 20% of our oil and natural gas revenue for the year ended December 31, 2008 and the nine months ended September 30, 2009. As such, for the three months ending March 31, 2010, our revenues were derived entirely from our Richard King Field properties.

Equity Investment

In September and October 2008, we purchased an aggregate of 350,000 shares of common stock of Meridian Resources Corporation, an exploration and production company whose shares trade on the New York Stock Exchange under the ticker symbol “TMR.” As of December 31, 2008, we incurred an unrealized holding loss of $325,465 on our investment. As of December 31, 2008, the net market value of our TMR investment was $199,500, comprising approximately 22.2% of total assets. In June 2009, we sold an aggregate of 100,000 shares of common stock of Meridian Resources Corporation and realized a loss of $134,096. As of December 31, 2009 we determined the decline in value of the Meridian shares to be other than temporary. Based on this determination the shares were adjusted to their market value as of December 31, 2009 of $66,250. The difference between the cost and market value of the shares was recorded as impairment expense for $279,345. On January 4, 2010, we sold our remaining 250,000 shares of common stock in Meridian Resources Corporation and realized an approximate loss of $654 based on an average cost basis. We no longer have an equity investment in Meridian Resources or any other corporation. We do not have any current plans, proposals or arrangements, written or otherwise, to make any equity investment in Meridian Resources Corporation or any other company.

Results of Operation

Three Months Ended March 31, 2010 Compared to March 31, 2009

Production. Our average monthly production decreased from approximately 426 Barrels of Oil Equivalent (“BOE”) in the first quarter of 2009 to 227 BOE in the first quarter of 2010. The decrease in our production was a result of the natural production decline of the Durango wells as well as the loss of production from the Aldwell Unit due to its divestiture.

Revenues and production. The following table illustrates the primary components of revenues, production volumes and realized prices for the periods noted.

	For the three months ended 3/31/2009						For the three months ended 3/31/2010
	Production (BOE)		Avg. Price per BOE ($)		Total Revenues ($)		Production (BOE)		Avg. Price per BOE ($)		Total Revenues ($)
Aldwell Unit		286		30.84		8,821		-		-		-
Richard King		994		12.64		12,568		682		37.20		25,368
TOTAL		1,280		16.71		21,389		682		37.20		25,368

Revenues. Revenues from continuing operations increased from $12,568 to $25,368 for the three months ended March 31, 2010, as compared to the three months ended March 31, 2009, due to an increase in oil and gas prices. Production realized from the Aldwell Unit decreased by 286 barrels of oil equivalent (BOE) over the periods due to its sale and; and production in the Richard King Field decreased from 994 BOE to 682 BOE. Additionally, the average price per BOE increased from $16.71 to $37.18 for the three months ended March 31, 2009 to 2010, respectively.

Production. Our average monthly production decreased from 331 Barrels of Oil Equivalent (“BOE”) in the first quarter of 2009 to 227 BOE in the first quarter of 2010. Most wells produce at higher initial rates and their production declines as they deplete over time. Our monthly production decreased for two reasons. First, our operator choked back the production from the Mary King Estell Lease to retain some of our gas to sell at higher prices. Second, we sold the Aldwell Unit for a profit to create additional liquidity for operating expenses and debt service.

Production costs. Production costs, which includes lease operating expenses and excludes severance and ad valorem taxes, decreased from $7,671 to $3,610 during the three months ended March 31, 2009 and 2010, respectively. Because of increases in oil and gas prices and decreases in our production costs, our production costs from continuing operations as a percentage of revenue decreased from 61% to 14% for the respective periods.

Depreciation, depletion and amortization (“DD&A”) expense. DD&A expense from continuing operations decreased from $8,549 to $4,500 during the three months ended March 31, 2009 and 2010, respectively. This was due to a decrease in our capitalized expenses in proved properties and a lower depletion rate of our production in 2010 as compared to 2009.

G&A expense. Our general and administrative expense was $103,464 and $141,504 for the three months ended March 31, 2009 and 2010, respectively. These expenses include rent, office expenses, travel expenses, salaries for employees, consulting expenses, legal and accounting expenses and benefits for employees. This increase can be attributed primarily to increases in the following: legal and accounting expenses, consulting expenses, salaries, office supplies, insurance premiums, utilities and miscellaneous expenses. Many of the above expenses increased in connection with filing a registration statement with the Securities and Exchange Commission and becoming a publicly reporting company.

Income taxes. Southfield experienced losses for the quarters ended March 31, 2009 and 2010 and therefore was not subject to federal income taxes.

Liquidity and Capital Resources

Historically, we have financed our operations through the sale of debt and equity securities and cash generated from operations. As of March 31, 2010 we had $8,819 of cash and cash equivalents, a working capital deficit of $518,187 and a total stockholders’ deficit of $1,815,382. Our expenses exceeded our revenues for the three months ended March 31, 2010; thus, we incurred a net operating loss of $155,660.

We will need to raise money through our registered offering of 3 Year Notes to fund our business plan and support our operations after April 1, 2010. The length of time we are able to operate is contingent on the amount of money we raise through our Offering. We offer no assurance that we will be able to raise any amount of money through the Offering. To the extent we are able to raise an amount of money in the Offering to cover our operating expenses; we plan to invest the proceeds in additional working interests in existing oil and gas production as well as new oil and gas wells. Because our proved reserves and production decline continually over time, we will need to make additional investments in oil and gas projects to sustain our level of revenue. Our financial statements for the three months ended March 31, 2010 includes a going concern note. Although we have successfully funded our operations to date by attracting investors to our equity and debt, there is no assurance that our capital raising efforts will be able to attract additional necessary capital for our operations. If we are unable to obtain additional funding for operations at any time now or in the future, we may not be able to continue operations as proposed, requiring us to modify our business plan, curtail various aspects of our operations, sell our assets or cease operations and file for bankruptcy.

The accompanying financial statements have been prepared assuming that Southfield will continue as a going concern. As shown in the accompanying financial statements, we had negative cash flows from operations of $131,653 and $68,274 for the three months ended March 31, 2010 and 2009. These conditions raise substantial doubt as to our ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. Management intends to finance these deficits by selling 3 Year Notes and seeking additional outside financing through either debt or sales of its common stock.

Maturities of the notes over the next five years for the twelve months ending March 31 are as follows:

2011				2012				2013				2014				2015
$	224,000			$	674,000			$	580,000			$	317,000			$	85,000

Currently, the Company does not have sufficient cash to meet its short term and long term debt obligations. Without substantial capital investment from issuances of debt and/or equity, the Company will not be able to meet its obligations. The Company has registered its common stock with the Securities and Exchange Commission and is pursuing the quotation of its common stock on the OTC Bulletin Board to raise additional equity capital for the business.

Cash Flows

Operating activities. Net cash used in operating activities for the three months ended March 31, 2010 as compared to the three months ended March 31, 2009 was $131,653 and $68,274, respectively. We incurred a loss on the sale of available for sale securities of $654; amortization of loan and debenture costs of $29,625; depreciation, depletion and amortization costs from continuing operations of $4,500; an increase in cash flows from accounts payable and accrued expenses of $41,733; and a decrease in cash flow from receivables of $542, respectively. Accounts payable increased primarily from legal and accounting expenses related to the registration of our 3 Year Notes and public reporting requirements.

Investing activities. Net cash provided / (used) in investing activities for the three months ended March 31, 2010 as compared to the three months ended March 31, 2009 was $65,596 and $(76,035), respectively. We did not make any capital investments in proved leaseholds during the period. The primary reason for the increase in cash flows from investing activities was due to the sale of available for sale securities which accounted for $65,596 of cash provided by investing activities.

Financing activities. Net cash provided from financing activities for the three months ended March 31, 2010 as compared to the three months ended March 31, 2009 was $6,050 and $206,068, respectively. This change was primarily due to a decrease in debenture sales from $240,000 to $35,000 for the respective periods. We also repaid 29,000 of debentures in the first quarter of 2010.

Outlook

Significant factors that may impact future commodity prices include developments in the issues currently impacting the Middle East, Africa and South America in general; the extent to which members of the Organization of Petroleum Exporting Countries (“OPEC”) and other oil exporting nations are able to continue to manage oil supply through export quotas; and overall North American gas supply and demand fundamentals, including the impact of increasing liquefied natural gas (“LNG”) deliveries to the United States and political and regulatory changes by the U.S. government. Generally, the prices for any commodity that we produce will approximate market prices in the geographic region of the production.

Our future oil and gas reserves, production, cash flow and ability to make principal and interest payments on our debt obligations depend on our success in producing our current reserves efficiently and acquiring additional proved reserves economically. We expect to pursue acquisitions of producing oil and gas properties, invest in working interests in new wells and to acquire lease rights and royalty rights to oil and gas properties.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future affect on our financial condition, revenues or expense, results of operations, liquidity, capital expenditures or capital resources that are material to our stakeholders.

Contractual Obligations

	Payments Due By Period
Contractual Obligations at March 31, 2010	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Convertible Debentures	$	1,880,000	$	224,000	$	1,571,000	$	85,000	$	0

Short term notes payable	$	3,900	$	3,900	$	0	$	0	$	0

Total	$	1,883,900	$	227,900	$	1,571,000	$	85,000	$	0

Critical Accounting Estimates

We prepared our financial statements in accordance with GAAP. GAAP represents a comprehensive set of accounting and disclosure rules and requirements, the application of which requires management judgments and estimates including, in certain circumstances, choices between acceptable GAAP alternatives. Following is a discussion of our most critical accounting estimates, judgments and uncertainties that are inherent in the application of GAAP.

Asset retirement obligations. We have obligations to remove tangible equipment and facilities and to restore land at the end of oil and gas production operations. Our removal and restoration obligations are primarily associated with plugging and abandoning wells. Estimating the future restoration and removal costs is difficult and requires management to make estimates and judgments because most of the removal obligations are many years in the future and contracts and regulations often have vague descriptions of what constitutes removal. Asset removal technologies and costs are constantly changing, as are regulatory, political, environmental, safety and public relations considerations.

Inherent in the present value calculation are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount rates, timing of settlement and changes in the legal, regulatory, environmental and political environments. Changes in any of these estimates can result in revisions to the estimated asset retirement obligation. Revisions to the estimated asset retirement obligation are recorded with an offsetting change to the carrying amount of the related oil and gas properties, resulting in prospective changes to depletion and accretion expense. Because of the subjectivity of assumptions and the relatively long life of most of our oil and gas properties, the costs to ultimately retire these assets may vary significantly from our estimates. Based on our calculation as of March 31, 2010 the asset retirement obligation liability was immaterial to the financial statements. We will continually evaluate this liability and record it, if and when it becomes material.

Successful efforts method of accounting. We utilize the successful efforts method of accounting for oil and gas producing activities as opposed to the full cost method. The critical difference between the successful efforts method of accounting and the full cost method is as follows: under the successful efforts method, exploratory dry holes and geological and geophysical exploration costs are charged against earnings during the periods in which they occur, whereas, under the full cost method of accounting, such costs and expenses are capitalized as assets, pooled with the costs of successful wells and charged against the earnings of future periods as a component of depletion expense.

Proved reserve estimates. Estimates of our proved reserves included in this prospectus are prepared in accordance with GAAP and SEC guidelines. The accuracy of a reserve estimate is a function of:

•

The quality and quantity of available data;

•

The interpretation of that data;

•

The accuracy of various mandated economic assumptions; and

•

the judgment of the persons preparing the estimate.

Estimates of proved reserves materially impact depletion expense. If the estimates of proved reserves decline, the rate at which we recognize depletion expense will increase, reducing future net income. Such a decline may result from lower market prices, which may make it uneconomical to drill for and produce higher cost fields. In addition, a decline in proved reserve estimates may impact the outcome of our assessment of our proved properties for impairment.

Impairment of proved oil and gas properties. We review our proved properties to be held and used whenever management determines that events or circumstances indicate that the recorded carrying value of the properties may not be recoverable. Management assesses whether or not an impairment provision is necessary based upon its outlook of future commodity prices and net cash flows that may be generated by the properties and if a significant downward revision has occurred to the estimated proved reserves. If the sum of the undiscounted future net cash flows of a proved producing property is less than the carrying value of the proved producing property, then an impairment is made to reduce the value at which those assets are carried on our balance sheet.

Environmental contingencies. Our management makes judgments and estimates in recording liabilities for ongoing environmental remediation. Actual costs can vary from such estimates for a variety of reasons. Environmental remediation liabilities are subject to change because of changes in laws and regulations, developing information relating to the extent and nature of site contamination and improvements in technology. Under GAAP, a liability is recorded for these types of contingencies if we determine the loss to be both probable and reasonably estimable.

New Accounting Pronouncements

We adopted the Financial Accounting Standards Board’s (FASB) Standard related to fair value measurement at inception. The standard defines fair value, establishes a framework for measuring fair value and expands disclosure of fair value measurements. The standard applies under other accounting pronouncements that require or permit fair value measurements and accordingly, does not require any new fair value measurements. The standard clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the standard established 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;

•

Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

•

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

Recently Issued Accounting Pronouncements

In August 2009, the FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective on October 1, 2009. Southfield had no instruments that fall within the scope of this pronouncement as of March 31, 2010.

In May 2008, the FASB issued an amendment to the accounting standards related to the hierarchy of GAAP. The standard 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 standard becomes effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board (“PCAOB”) amendment to AU Section 411, “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles” and is not expected to have a significant impact on our financial statements.

Plan of Operation

Over the next twelve months we intend to develop the following initiatives:

Financing

We anticipate raising $10 million in debt financing over the next 12-24 months through the sale of 3 Year Notes as described in our S-1 filing. In addition to the sale of 3 Year Notes, we anticipate raising additional equity capital provided that the terms and conditions for the placement of such funding is based upon an equity valuation and underwriting fees that are amenable to our board of directors.

Revenue Generation

We intend to invest the predominance of the gross proceeds from the issuance of the $10 million in 3 Year Notes into oil and gas projects. We expect these to include a combination of acquisitions of proved producing properties with drilling or recompletion upside and investment in exploratory and development drilling programs. After the deployment of this capital, we expect our production, reserves, revenues and cash flow to increase substantially.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A smaller reporting company is not required to provide the information required by this item.

ITEM 4T.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and 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.

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to 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, have been detected. To address the material weaknesses, we performed additional analysis and other post-closing procedures in an effort to ensure our consolidated financial statements included in this annual report have been prepared in accordance with generally accepted accounting principles. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.

Material Weakness in Internal Control.

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 the company's annual or interim financial statements will not be prevented or detected on a timely basis. We have identified the following material weaknesses.

1.) As of March 31, 2010, we did not maintain effective controls over the control environment. Specifically we have not developed and effectively communicated to our employees its accounting policies and procedures. This has resulted in inconsistent practices. Further, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-B. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.

2.) As of March 31, 2010, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness.

Because of these material weaknesses, management has concluded that the Company did not maintain effective internal control over financial reporting as of March 31, 2010, based on the criteria established in "Internal Control-Integrated Framework" issued by the COSO.

Changes in Internal Control over Financial Reporting

There have been no changes in internal controls or in other factors that could significantly affect these controls subsequent to the date of our internal controls evaluation for the previously filed annual report on Form 10-K, including any corrective actions with regards to significant deficiencies and material weaknesses.

PART II – OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

In the ordinary course of our business, we may from time to time become subject to routine litigation or administrative proceedings which are incidental to our business. We are not a party to nor are we aware of any existing, pending or threatened lawsuits or other legal actions involving us.

ITEM 1A.

RISK FACTORS

An investment in our common stock or debt involves a high degree of risk. You should carefully consider the following risk factors, other information included in this annual report and information in our other periodic reports filed with the SEC. The risk factors set forth below are not the only risks that may affect our business. Our business could also be impacted by additional risks not currently known to us or that we currently deem to be immaterial. If any of the following risks actually occur, our business, financial condition or results of operations could be materially and adversely affected, and you could lose part or all of your investment.

Risks Related to Our Business

We may not have sufficient cash flow from operations to pay interest on debt when due or to repay principal upon maturity. Reductions in cash flow from operations could adversely affect holders of our debt or equity.

Revenue and profit from oil and gas is uncertain. Prices may drop lower than they are today. We expect to invest in working interests in new oil and gas wells. These investments may not be profitable and we may lose our entire investment. Oil and gas properties are depleting assets and we will have to successfully continue to find additional oil and gas to offset the natural decline of producing wells in which we own an interest. These uncertainties are a material risk of investing in oil and gas and may materially affect our ability to make interest payments when due and to repay principal upon maturity. They may also cause a reduction in the value of our equity.

The amount of cash we actually generate will depend upon numerous factors related to our business including, among other things:

•

the amount of oil and gas our operators produce;

•

the prices at which our operators sell our oil and gas production;

•

the level of our operating costs, including fees and reimbursement of expenses expended to operate the company and to compensate its management team, board of directors and employees;

•

our ability to replace declining reserves;

•

prevailing economic conditions;

•

the level of competition we face;

•

fuel conservation measures and alternate fuel requirements; and

•

government regulation and taxation.

In addition, the actual amount of cash that we will have available to make payments on the principal and interest on our debt will depend on other factors, including:

•

the level of our expenditures for acquisitions of additional oil and gas investments;

•

our ability to make borrowings or to raise additional capital in the future;

•

sources of cash used to fund acquisitions;

•

debt service requirements of our debt or future financing agreements;

•

fluctuations in our working capital needs;

•

general and administrative expenses;

•

timing and collectability of any receivables; and

•

the amount of cash reserves established by our management team for the proper conduct of our business.

All of our current revenues are generated by our interest in the Richard King Field. Delays or interruptions in our interests in the Richard King Field natural gas and production operations including, but not limited to, the failure of third parties on which we rely to provide key services, could negatively impact our revenues.

As of March 31, 2010, 100% of our oil and natural gas properties were derived from the Richard King Field. Should the production in this field decrease at a rate faster than anticipated, our revenues and cash flow to make payments on our debt could be adversely affected. In connection with the Richard King Field, we have partnered with Durango Resources Corporation as operator. The failure of Durango Resources to perform its duties as operator in the Richard King Field could prevent us from generating revenues. In addition, events referred to as force majeure, such as an act of God, act of a public enemy, fire, flood, lightning, etc. could prevent us from generating revenues.

Our business may be harmed by failures of third party operators on which we rely.

Our ability to manage and mitigate the various risks associated with our operations in Nueces County, Texas, is limited since we rely on third parties to operate our projects. We are a non-operating interest owner in our properties. With respect to our non-operated working interests, we have entered into agreements with third party operators for the conduct and supervision of drilling, completion and production operations. In the event that commercial quantities of oil and natural gas are discovered on one of our properties, the success of the oil and natural gas operations on that property depends in large measure on whether the operator of the property properly performs its obligations. The failure of such operators and their contractors to perform their services in a proper manner could result in materially adverse consequences to the owners of interests in that particular property, including us.

We cannot control activities on properties we do not operate. Our inability to fund required capital expenditures with respect to non-operated properties may result in a reduction or forfeiture of our interests in those properties.

Other companies operated all of our production as of March 31, 2010. We have limited ability to exercise influence over operations for these properties or their associated costs. Our dependence on the operator and other working interest owners for these projects and our limited ability to influence operations and associated costs could prevent the realization of our targeted returns on capital with respect to exploration, exploitation, development or acquisition activities. The success and timing of exploration, exploitation and development activities on properties operated by others depend upon a number of factors determined by the operator, including:

•

the timing and amount of capital expenditures;

•

the operator's expertise and financial resources;

•

approval of other participants in drilling wells; and

•

selection of drilling, completion and production equipment.

Where we are not the majority owner or operator of a particular oil and natural gas project, we may have no control over the timing or amount of capital expenditures associated with the project. If we are not willing and able to fund required capital expenditures relating to a project when required by the majority owner or operator, our interests in the project may be reduced or forfeited.

Because oil and gas properties are depleting assets we must drill new wells or make acquisitions in order to maintain our production and reserves and sustain our payments of principal and interest to our debt holders over time. Failure to do this could adversely affect investments in our debt or equity.

Producing oil and gas reservoirs are characterized by declining production rates. Because our reserves and production decline continually over time, we will need to drill additional wells or make acquisitions to sustain revenue over time. We may be unable to accomplish this if:

•

Sellers do not agree to sell any assets to us;

•

we are unable to identify attractive drilling or acquisition opportunities in our area of operations;

•

we are unable to agree on investment terms or a purchase price for assets that are attractive to us; or

•

we are unable to obtain financing for acquisitions on economically acceptable terms.

We will require substantial capital expenditures to replace our production and reserves, which will reduce our available cash for interest and principal payments. We may be unable to obtain needed capital or financing due to our financial condition, which could adversely affect our ability to replace our production and proved reserves.

To fund our projects, we will be required to use cash generated from our operations in addition to cash raised in financing activities. We may engage in additional borrowings or obtain financing from the issuance of additional equity interests in the Company, or some combination thereof. To the extent our production declines faster than we anticipate, or the cost to acquire additional reserves is greater than we anticipate, we will require a greater amount of capital to maintain our production and proved reserves. The use of cash generated from operations to fund oil and gas investments will reduce cash available to pay interest and principal on our debt. Our ability to obtain bank financing or to access the capital markets for future equity or debt offerings may be limited by our financial condition at the time of any such financing or offering, the covenants in our existing debt or future financing agreements, adverse market conditions or other contingencies and uncertainties that are beyond our control. Our failure to obtain the funds necessary for future oil and gas investments could materially affect our business, results of operations, financial condition, the value of our equity and our ability to pay interest and principal on our debt.

Any new wells in which we participate are subject to substantial risks that could reduce our ability to make profits from operations.

Investments that we believe will increase revenue may nevertheless result in losses. Any oil and gas investment involves potential risks, including, among other things:

•

the validity of our assumptions about reserves, future production, revenues and costs;

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a decrease in our liquidity by using a significant portion of our available cash to finance investments;

•

a significant increase in our interest expense or financial leverage if we incur additional debt to finance investments;

•

the diversion of management’s attention from other business concerns; and

•

an inability to hire, train or retain qualified personnel to manage and operate our growing business and assets.

We could lose our ownership interests in our properties due to a title defect of which we are not presently aware.

As is customary in the oil and gas industry, only a perfunctory title examination, if any, is conducted at the time properties believed to be suitable for drilling operations are first acquired. Before starting drilling operations, a more thorough title examination is usually conducted and curative work is performed on known significant title defects. We typically depend upon title opinions prepared at the request of the operator of the property to be drilled. The existence of a title defect on one or more of the properties in which we have an interest could render it worthless and could result in a large expense to our business. Industry standard forms of operating agreements usually provide that the operator of an oil and natural gas property is not to be monetarily liable for loss or impairment of title. The operating agreements to which we are a party provide that, in the event of a monetary loss arising from title failure, the loss shall be borne by all parties in proportion to their interest owned.

The prices of oil and gas have reached historic highs in recent years and are highly volatile. A sustained decline in these commodity prices would cause a decline in our cash flow from operations, which may adversely affect investments in our debt or equity.

The oil and gas markets are highly volatile, and future oil and gas prices are uncertain. Prices for oil and gas may fluctuate widely in response to relatively minor changes in the supply of and demand for oil and gas, market uncertainty and a variety of additional factors, such as:

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domestic and foreign supply of and demand for oil and gas;

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weather conditions;

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overall domestic and global political and economic conditions, including those in the Middle East, Africa and South America;

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actions of the Organization of Petroleum Exporting Countries and other state-controlled oil companies relating to oil price and production controls;

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the impact of increasing liquefied natural gas, or LNG, deliveries to the United States;

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technological advances affecting energy consumption and energy supply;

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domestic and foreign governmental regulations and taxation;

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the impact of energy conservation efforts;

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the capacity, cost and availability of oil and gas pipelines and other transportation facilities, and the proximity of these facilities to our wells; and

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the price and availability of alternative fuels.

Our revenue, profitability and cash flow depend upon the prices and demand for oil and gas, and a drop in prices can significantly affect our financial results, impede our growth, and reduce the value of our equity. In addition, we may not be able to sustain payments of principal and interest to our debt holders during periods of lower commodity prices.

Future price declines may result in another write-down of our asset carrying values, which could adversely affect our results of operations, limit our ability to make payments on the principal and interest to our debt holders, and could adversely affect the value of our equity.

Due to low commodity prices for oil and gas at December 31, 2008, we were required to impair our assets located in the Aldwell Unit. An impairment test was conducted using data in a reserve report prepared by a reserve engineering firm. While conducting the impairment test, management determined that the estimated undiscounted future net cash flow provided in the reserve report was less that the carrying value of the Aldwell Unit on the Company’s Balance Sheet on December 31, 2008 and that the assets were subject to impairment. The assets were subsequently impaired.

Further declines in oil and gas prices may result in our having to make substantial downward adjustments to our estimated proved reserves. If this occurs, or if our estimates of production or economic factors change, accounting rules may require us to write down, as a noncash expense, the carrying value of our oil and gas properties for impairments. We are required to perform impairment tests on our assets whenever events or changes in circumstances warrant a review of our assets. To the extent such tests indicate a reduction of the estimated useful life or estimated future cash flows of our assets, the carrying values may not be recoverable and therefore require write-downs. We may incur further impairment charges in the future, which could materially affect our results of operations in the period incurred and our ability to raise capital, which in turn may adversely affect our ability to generate revenues.

Our future hedging activities could result in financial losses or could reduce our income, which may adversely affect the value of our equity or our ability to repay interest and principal on our debt when due.

To achieve more predictable cash flow and to reduce our exposure to adverse fluctuations in the prices of oil and gas, we may enter into derivative arrangements covering a significant portion of our oil and gas production that could result in both realized and unrealized hedging losses. These losses could adversely affect investments in our debt or equity.

Our estimated proved reserves are based on many assumptions that may prove to be inaccurate. Any material inaccuracies in these reserve estimates or underlying assumptions will materially affect the quantities and present value of our proved reserves.

It is not possible to measure underground accumulations of oil or gas in an exact way. Oil and gas reserve engineering requires subjective estimates of underground accumulations of oil and gas and assumptions concerning future oil, natural gas and natural gas liquid (“NGL”) prices, production levels, and operating and development costs. In estimating our level of proved oil and gas reserves, we and our independent reservoir engineers make certain assumptions that may prove to be incorrect, including assumptions relating to:

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a constant level of future oil, NGL and gas prices;

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future production levels;

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capital expenditures;

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operating and development costs;

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the effects of regulation; and

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Future availability of funds.

If these assumptions prove to be incorrect, our estimates of proved reserves, the economically recoverable quantities of oil, NGL and gas attributable to any particular group of properties, the classifications of reserves based on risk of recovery and our estimates of the future net cash flows from our proved reserves could change significantly. Over time, we may make material changes to reserve estimates to take into account changes in our assumptions and the results of actual drilling and production.

The present value of future net cash flows from our estimated proved reserves is not necessarily the same as the current market value of our estimated proved oil and gas reserves. We base the estimated discounted future net cash flows from our estimated proved reserves on average prices and costs from the preceding year. However, actual future net cash flows from our oil and gas properties also will be affected by factors such as:

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the actual prices we receive for oil, NGL and gas;

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our actual operating costs in producing oil, NGL and gas;

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the amount and timing of actual production;

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the amount and timing of our capital expenditures;

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supply of and demand for oil, NGL and gas; and

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changes in governmental regulations or taxation.

The timing of both our production and our incurrence of expenses in connection with the production and development of oil and gas properties will affect the timing of actual future net cash flows from proved reserves, and thus their actual present value. In addition, the 10% discount factor we use when calculating discounted future net cash flows in compliance with FASB standards may not be the most appropriate discount factor based on interest rates in effect from time to time and risks associated with us or the oil and gas industry in general.

Producing oil and gas involves numerous risks and uncertainties that could adversely affect our financial condition or results of operations and, as a result, decrease the value of our equity or limit our ability to pay principal and interest payments to our debt holders.

As non-operated working interest owners we do not operate wells; however, we share in the costs of production for these wells. The operating cost of a well includes variable costs, and increases in these costs can adversely affect the economics of a well. Furthermore, our producing operations may be curtailed or delayed or become uneconomical as a result of other factors, including:

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high costs, shortages or delivery delays of equipment, labor or other services;

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unexpected operational events and/or conditions;

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reductions in oil, NGL and gas prices;

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limitations in the market for oil, NGL and gas;

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adverse weather conditions;

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facility or equipment malfunctions;

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equipment failures or accidents;

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title problems;

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pipe or cement failures or casing collapses;

•

compliance with environmental and other governmental requirements;

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environmental hazards, such as gas leaks, oil spills, pipeline ruptures and discharges of toxic gases;

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lost or damaged oilfield work over and service tools;

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unusual or unexpected geological formations or pressure or irregularities in formations;

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fires;

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natural disasters; and

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uncontrollable flows of oil, gas or well fluids.

If any of these factors were to occur with respect to a particular field, we could lose all or a part of our investment in the field, or we could fail to realize the expected benefits from the field, either of which could materially and adversely affect our revenue and profitability.

We may incur debt to enable us to pay our interest and principal payments, which may negatively affect our ability to execute our business plan.

If we use borrowings under a credit facility to meet our current liability obligations rather than toward funding future investments and other matters relating to our operations, we may be unable to support or grow our business. Such a curtailment of our business activities, combined with our payment of principal and interest on our future indebtedness to pay these distributions, will reduce our cash available to make payments of principal and interest on our debt and will materially affect our business, financial condition and results of operations.

Our operations are subject to operational hazards and unforeseen interruptions for which we may not be adequately insured.

Operators of our wells are subject to a variety of operating risks in our wells, gathering systems and associated facilities, such as leaks, explosions, mechanical problems and natural disasters, all of which could cause substantial financial losses. Any of these or other similar occurrences could result in the disruption of our operations, substantial repair costs, personal injury or loss of human life, significant damage to property, environmental pollution, impairment of our operations and substantial revenue losses.

We currently possess a Business Owners insurance policy which includes property, business interruption and general liability insurance at levels we believe are appropriate for an early stage company; however, insurance against all operational risk is not available to us. We are not fully insured against all risks. In addition, pollution and environmental risks generally are not fully insurable.

Shortages of drilling rigs, supplies, oilfield services, equipment and crews could delay our operations and reduce our available cash.

To the extent that in the future we acquire and develop undeveloped properties, higher commodity prices generally increase the demand for drilling rigs, supplies, services, equipment and crews, and can lead to shortages of, and increasing costs for, drilling equipment, services and personnel. Shortages of, or increasing costs for, experienced drilling crews and equipment and services could restrict our future ability to drill wells and conduct operations. Any delay in the drilling of new wells or significant increase in drilling costs could reduce our future revenues and cash available for distribution.

The third parties on whom we rely for gathering and transportation services are subject to complex federal, state and other laws that could adversely affect the cost, manner or feasibility of conducting our business.

The operations of the third parties on whom we rely for gathering and transportation services are subject to complex and stringent laws and regulations that require obtaining and maintaining numerous permits, approvals and certifications from various federal, state and local government authorities. These third parties may incur substantial costs in order to comply with existing laws and regulation. If existing laws and regulations governing such third party services are revised or reinterpreted, or if new laws and regulations become applicable to their operations, these changes may affect the costs that we pay for such services. Similarly, a failure to comply with such laws and regulations by the third parties on whom we rely could have a material adverse effect on our business, financial condition, and results of operations.

If third-party pipelines and other facilities interconnected to our gas pipelines and processing facilities become partially or fully unavailable to transport gas, our revenues from operations could be adversely affected.

We depend upon third party pipelines and other facilities that provide delivery options to and from pipelines and processing facilities that our operators utilize. If any of these third-party pipelines and other facilities become partially or fully unavailable to transport gas, or if the gas quality specifications for these pipelines or facilities change so as to restrict our operators’ ability to transport gas on these pipelines or facilities, our revenues and cash available to make principal and interest payments to our debt holders could be adversely affected, as well as the value of our equity.

Our operations are subject to various litigation risks that could increase our expenses, impact our profitability and lower the value of your investment in us.

We are not currently involved in any litigation; however, the nature of our operations exposes us to possible future litigation claims. There is a risk that any claim could be adversely decided against us, which could harm our financial condition and results of operations. Similarly, the costs associated with defending against any claim could dramatically increase our expenses, as litigation is often very expensive. Possible litigation matters may include, but are not limited to, environmental damage and remediation, insurance coverage, property rights and easements and the maintenance of oil and gas leases. Should we become involved in any litigation we will be forced to direct our limited resources to defending against or prosecuting the claim(s), which could impact our profitability and lower the value of your investment in us.

Our business is subject to environmental legislation and any changes in such legislation could prevent us from earning revenues.

The oil and gas industry is subject to many laws and regulations that govern the protection of the environment, health and safety and the management, transportation and disposal of hazardous substances. These laws and regulations may require the removal or remediation of pollutants and may impose civil and criminal penalties for any violations thereof. Some of the laws and regulations authorize the recovery of natural resource damages by the government, injunctive relief and the imposition of stop, control, remediation and abandonment orders.

Complying with environmental and natural resource laws and regulations may increase our operating costs as well as restrict the scope of our operations. Any regulatory changes that impose additional environmental restrictions or requirements on us could affect us in a similar manner. If the costs of such compliance or changes exceed our budgeted costs, we may not be able to earn revenues.

We may become an “investment company” as defined in the Investment Company Act of 1940.

Under the Investment Company Act of 1940 (the “Act”), as amended, we may be deemed to be an inadvertent investment company if it is determined that the value of investments in other company’s securities accounts for more than 40% of the total value of our assets, and no other exemption is available. If so, and if we were to be deemed an inadvertent investment company, we believe that we may be eligible for temporary relief from the application of the Act if we have a bona fide intent to be engaged primarily, as soon as reasonably possible (in any event within one year), in a business other than that of investing, reinvesting, owning, holding or trading in securities. We do not have any current plans, proposals or arrangements, written or otherwise, to invest in the securities of any other company.

Investment companies are subject to substantial regulation concerning management, operations, transactions with affiliated persons, portfolio composition, including restrictions with respect to diversification and industry concentration and other restrictions, and, unless we complied with the Act, we would be prohibited from engaging in transactions involving interstate commerce. To comply, we would be required to significantly modify our operating structure and file reports with the SEC regarding various aspects of our business. The cost of such compliance would result in the Company incurring substantial additional annual expenses. In addition, compliance with the Act may not be consistent with the Company’s current business strategies.

Risks Related to Financing Activities

We may issue additional debt, including notes that are senior to our current debt, without your approval.

The amount of additional debt that can be raised by us is not limited. We may incur an unlimited amount of indebtedness that is senior to our existing debt without your approval.

Debt Holders will not have the same rights to vote on matters submitted to the shareholders for consideration and approval as the holders of common shares.

Certain matters, such as the appointment of directors, amendment of corporate documents, etc. must be submitted to a vote of the shareholders for approval. Debt Holders will not have voting rights on such matters as do the common shareholders.

Debt Holders will have very limited liquidity in their investments. We do not intend nor expect to request that Southfield’s debt instruments be listed for trading on any exchange.

The Company does not intend nor expect to list its debt for trading on any exchange or over-the-counter listing service. As a result, the Holders of our debt are not expected to have any market liquidity in their investment and should be prepared to hold our debt to Maturity.

As a result of investing in our debt, you may become subject to state and local taxes.

Interest earned on our debt instruments will be taxed by the Federal and state governments in accordance with current and future tax laws. You should expect to pay taxes at your marginal rate for investments of this type.

Some of our officers and directors have relationships with other companies in the oil and natural gas industry that could result in conflicts of interest.

Some of our officers and directors serve as officers and directors of other companies engaged in the oil and natural gas industry and may have other relationships with such companies. For example, Chet Gutowsky and Tyson Rohde both serve as officers and directors of Biotricity Corporation, an alternative energy company located in Houston, Texas. To the extent those companies are involved in ventures in which we may participate, or compete for acquisitions or financial resources with us, the relevant director will face a conflict of interest. In the event such a conflict arises, the relevant director will be required to disclose the nature and extent of the conflict and abstain from voting for or against any action of the board of directors that is or could be affected by the conflict.

We are dependent upon our key officers and employees and our inability to retain and attract key personnel could significantly hinder our growth strategy and cause our business to fail.

A loss of one or more of our current directors, officers or key employees could severely and negatively impact our operations and delay or preclude us from achieving our business objectives. Our executive officers have a combined experience of approximately 50 years in the oil and gas and related industries. We have not entered into employment agreements with our officers, and we could suffer the loss of key individuals for one reason or another at any time in the future. There is no guarantee that we could attract or locate other individuals with similar skills or experience to carry out our business objectives.

Our directors and officers hold significant positions in our shares of common stock and their interests may not always be aligned with those of our other shareholders.

As of March 31, 2010 our directors and officers beneficially own 18.9% of our outstanding common stock. See “Security Ownership of Certain Beneficial Owners and Management.” This shareholding level will allow the directors, officers and certain beneficial owners to have a significant degree of influence on matters that are required to be approved by shareholders, including the election of directors and the approval of significant transactions. The short-term interests of our directors, officers and certain beneficial owners may not always be aligned with the long-term interests of our shareholders, and vice versa. Because our directors, officers and certain beneficial owners have a significant degree of influence on matters that are required to be approved by our shareholders, they could influence the approval of transactions.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

We did not purchase or sell any unregistered securities during the period covered by this report.

We filed a registration statement for $10 million of 3 Year Notes that became effective on February 11, 2010. The 3 Year Notes are not convertible and are being offered directly through the company with the assistance of placement agents. The sales process for the placement of 3 Year Notes has commenced, however no sales were made as of March 31, 2010. The reason that sales have not been made is because we are working to fulfill state regulatory requirements and register the offering in certain states pursuant to Blue Sky Laws.

ITEM 3.

DEFAULTS UPON

None.

ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of our securityholders during the quarter ended March 31, 2010.

ITEM 5.

OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

(a)	Exhibits.

	31.1	Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer
	31.2	Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer
	32.1/32.2	Rule 1350 Certification of Chief Executive and Financial Officer

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SOUTHFIELD ENERGY CORPORATION

Dated: May 14, 2010	By:	/s/ Ben Roberts
		Ben Roberts
		President and CEO

Southfield Energy CORP 10-Q