Attached files

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EX-31.1 - CERTIFICATION FILED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 OF PRINCIPAL EXECUTIVE OFFICER - LIBERTY ENERGY CORP.exhibit31-1.htm
EX-32.1 - CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 OF PRINCIPAL EXECUTIVE OFFICER - LIBERTY ENERGY CORP.exhibit32-1.htm
EX-31.2 - CERTIFICATION FILED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 OF PRINCIPAL FINANCIAL OFFICER AND PRINCIPAL ACCOUNTING OFFICER - LIBERTY ENERGY CORP.exhibit31-2.htm
EX-32.2 - CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 OF PRINCIPAL FINANCIAL OFFICER AND PRINCIPAL ACCOUNTING OFFICER - LIBERTY ENERGY CORP.exhibit32-2.htm

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 April 30, 2011

or

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to _________

Commission File Number 333-138107

LIBERTY ENERGY CORP.
(Exact name of registrant as specified in its charter)

Nevada 205024859
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)
   
Two Allen Center, Suite 1600, 1200 Smith Street, Houston, TX 77002
(Address of principal executive offices) (Zip Code)

713.353.4700
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

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.
[X] YES [ ] NO

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
[ ] YES [ ] NO

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

Large accelerated filer [ ]
 
Accelerated filer [ ]
Non-accelerated filer [ ]
(Do not check if a smaller reporting company)
Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act [ ] YES [X] NO

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.
[ ] YES [ ] NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. 61,766,080 common shares issued and outstanding as of June 10, 2011

1


PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Our unaudited interim financial statements for the three and nine month periods ended April 30, 2011 form part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.

2



LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Balance Sheet

ASSETS     
    As of     As of  
    April 30,     July 31,  
    2011     2010  
             
Current Assets            
     Cash $  101,013   $  75,764  
     Deposits   -     1,250  
          342  
             
Total Current Assets   101,013     77,356  
Oil and Gas Properties, full cost method            
     Costs subject to amortization   665,883     538,824  
     Accumulated depletion   (4,167 )   -  
     Costs not subject to amortization   -     -  
             
Oil and Gas Properties, net   661,716     538,824  
             
Total Assets $  762,729   $  616,180  
             
   
Current Liabilities            
     Accounts Payable   96,203     303,535  
     Loan Payable - related party   25,000     25,000  
             
Total Current Liabilities   121,203     328,535  
Total Liabilities   121,203     328,535  
Stockholders' Equity            
Common stock, ($0.001 par value, 150,000,000 shares
authorized; 61,766,080 and 60,675,000 shares issued
and outstanding as of April 30, 2011 and
July 31, 2010 respectively
 


61,766
   


60,675
 
Additional paid-in capital   979,209     380,325  
Deficit accumulated during exploration stage   (399,448 )   (153,355 )
             
Total Stockholders' Equity   641,527     287,645  
           TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $  762,729   $  616,180  

See Notes to Financial Statements

3



LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Statement of Operations

                            June 6, 2006  
    Three Months     Three Months     Nine Months     Nine Months     (inception)  
    Ended     Ended     Ended     Ended     through  
    April 30,     April 30,     April 30,     April 30,     April 30,  
    2011     2010     2011     2010     2011  
                               
Revenues                              
  Revenues $  15,403   $  1,377   $  15,403   $  3,149   $  18,599  
                               
                               
Total Revenues   15,403     1,377     15,403     3,149   $  18,599  
Professional Fees   10,562     2,083     21,626     8,575     63,600  
Depletion   4,167     -     4,167     -     4,167  
General & Administrative Expenses   85,501     47,788     235,563     50,050     350,380  
                               
Total General & Administrative Expenses   (100,230 )   (49,871 )   (261,356 )   (58,625 ) $  (418,147 )
                               
Other Income/Expense                           100  
Net Income (Loss) $  (84,827 ) $  (48,494 ) $  (245,953 ) $  (55,476 ) $  (399,448 )
                               
Basic earnings per share $  (0.00 ) $  (0.00 ) $  (0.00 ) $  (0.00 )      
                               
Weighted average number of common shares outstanding   61,079,103     60,418,539     61,079,103     60,350,366      

See Notes to Financial Statements

4



LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Statement of Cash Flows

    Nine Months     Nine Months     (inception)  
    Ended     Ended     through  
    April 30,     April 30,     April 30,  
    2011     2010     2011  
                   
CASH FLOWS FROM OPERATING ACTIVITIES                  
   Net income (loss) $  (245,953 ) $  (55,476 ) $  (399,448 )
   Adjustments to reconcile net loss to net cash provided by (used in) operating activities:            
       Depletion   4,167           4,167  
   Changes in operating assets and liabilities:                  
       Accounts Receivable   342     (2,114 )   -  
       Deposit   1,250     (1,502 )   -  
       Accounts Payable   (207,473 )   306,491     96,203  
   Net cash provided by (used in) operating activities   (447,667 )   247,399     (299,078 )
CASH FLOWS FROM INVESTING ACTIVITIES                  
   Purchase of Oil and Gas Properties   (127,059 )   (525,000 )   (665,883 )
   Net cash provided by (used in) investing activities   (127,059 )   (525,000 )   (665,883 )
CASH FLOWS FROM FINANCING ACTIVITIES                  
   Issuance of common stock   1,091     475     61,766  
   Additional paid-in capital   598,884     274,525     979,209  
   Loan Payable - related party   -     25,000     25,000  
   Net cash provided by (used in) financing activities   599,975     300,000     1,065,975  
   Net increase (decrease) in cash   25,249     22,399     101,013  
   Cash at beginning of period   75,764     21,100     -  
   Cash at end of year $  101,013   $  43,499   $  101,013  
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION              
Cash paid during year for :                  
   Interest $  -   $  -   $  -  
   Income Taxes $  -   $  -   $  -  

See Notes to Financial Statements

5



LIBERTY ENERGY CORP.
(f/k/a DMA MINERALS INC.)
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
April 30, 2011

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

Liberty Energy Corp. (f/k/a DMA Minerals Inc., the “Company”) was incorporated on June 6, 2006 under the laws of the State of Nevada.

The Company carried out exploration on a mineral claim known as the TG Mineral Claim. The initial phase of exploration included detailed prospecting and mineralization mapping, followed by hand trenching to obtain clean, fresh samples. Based on the information available to it from its Phase I exploration program, it was determined that the TG Mineral Claim did not, in all likelihood, contain a commercially viable mineral deposit, and it therefore abandoned any further exploration on the property.

As a result, the Company has acquired several oil and gas properties and interests and is now focusing on raising additional funding for the exploration and development of those properties.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company reports revenue and expenses using the accrual method of accounting for financial and tax reporting purposes. The Company has elected a July 31, year-end.

Use of Estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.

Pro Forma Compensation Expense

No stock options have been issued by Liberty Energy Corp. Accordingly, no pro forma compensation expense is reported in these financial statements.

Mineral Property Acquisition and Exploration Costs

The Company expenses all costs related to the acquisition and exploration of mineral properties in which it has secured exploration rights prior to establishment of proven and probable reserves. To date, the Company has not established the commercial feasibility of any exploration prospects; therefore, all costs are being expensed.

6



LIBERTY ENERGY CORP.
(f/k/a DMA MINERALS INC.)
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
April 30, 2011

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

Depreciation, Amortization and Capitalization

The Company records depreciation and amortization when appropriate using both straight-line and declining balance methods over the estimated useful life of the assets (five to seven years). Expenditures for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's useful life are capitalized. Property sold or retired, together with the related accumulated depreciation, is removed from the appropriate accounts and the resultant gain or loss is included in net income.

Oil and gas properties

The Company follows the full-cost method of accounting for oil and natural gas properties. Under this method, all costs incurred in the exploration, acquisition, and development, including unproductive wells, are capitalized in separate cost centers for each country. Such capitalized costs include contract and concessions acquisition, geological, geophysical, and other exploration work, drilling, completing and equipping oil and gas wells, constructing production facilities and pipelines, and other related costs.

The capitalized costs of oil and gas properties in each cost center are amortized on a composite units of production method based on future gross revenues from proved reserves. Sales or other dispositions of oil and gas properties are normally accounted for as adjustments of capitalized costs. Gain or loss is not recognized in income unless a significant portion of a cost center’s reserves is involved. Capitalized costs associated with acquisition and evaluation of unproved properties are excluded from amortization until it is determined whether proved reserves can be assigned to such properties or until the value of the properties is impaired. If the net capitalized costs of oil and gas properties in a cost center exceed an amount equal to the sum of the present value of estimated future net revenues from proved oil and gas reserves in the cost center and the lower of cost or fair value of properties not being amortized, both adjusted for income tax effects, such excess is charged to expense.

The Company began production on December 30, 2010, but does not yet have reserve reports. Depletion has been estimated using the straight line method and whenever reserve reports are obtained, the estimates may be revised to reflect actual production.

The Company is continuing to work-over the Dalhstrom lease, Texas and is capitalizing those expenses in accordance with the oil and gas asset accounting policy. The Company expects to have the work completed by the end of the current financial year end and expect to incur further expenses of approximately $30,000 for a sand lock to be performed to conclude the work-over.

7



LIBERTY ENERGY CORP.
(f/k/a DMA MINERALS INC.)
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
April 30, 2011

The Company has completed work to the Lockhart lease, Texas and has capitalized the expenses in accordance with the oil and gas asset accounting policy as described above. The Company has successfully worked-over three wells, which are producing, and the Company is the process of finalizing plans to drill a new test well to the Edwards formation.

Revenue and cost recognition

The Company uses the sales method of accounting for natural gas and oil revenues. Under this method, revenues are recognized based on the actual volumes of gas and oil sold to purchasers. The volume sold may differ from the volumes to which the Company is entitled based on our interest in the properties. Costs associated with production are expensed in the period incurred.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

Income Taxes

The Company accounts for its income taxes in accordance with ASC No. 740, "Income Taxes". Under Statement 740, a liability method is used whereby deferred tax assets and liabilities are determined based on temporary differences between basis used for financial reporting and income tax reporting purposes. Income taxes are provided based on tax rates in effect at the time such temporary differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not, that the Company will not realize the tax assets through future operations.

Fair Value of Financial Instruments

ASC No. 825-50-10-1, "Financial Instruments – Overall Disclosure", requires the Company to disclose, when reasonably attainable, the fair market values of its assets and liabilities which are deemed to be financial instruments. The Company's financial instruments consist primarily of cash and certain investments.

Investments

Investments that are purchased in other companies are valued at cost less any impairment in the value that is other than temporary in nature.

Per Share Information

The Company computes per share information by dividing the net loss for the period presented by the weighted average number of shares outstanding during such period.

8



LIBERTY ENERGY CORP.
(f/k/a DMA MINERALS INC.)
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
April 30, 2011

Advertising

Advertising costs have been charged to expense as incurred include Public Relations Distribution expenses and were $2,731.25 for the quarter to April 30, 2011.

NOTE 3 - PROVISION FOR INCOME TAXES

The provision for income taxes for the period ended April 30, 2011 represents the minimum state income tax expense of the Company, which is not considered significant.

NOTE 4 - COMMITMENTS AND CONTINGENCIES

Litigation

The Company is not presently involved in any litigation.

NOTE 5 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Recently issued accounting pronouncements will have no significant impact on the Company and its reporting methods.

NOTE 6 – GOING CONCERN

Future issuances of the Company’s equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern. The Company’s present revenues are insufficient to meet operating expenses.

The consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $399,448 since its inception and requires capital for its contemplated operational activities to take place. The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

9



LIBERTY ENERGY CORP.
(f/k/a DMA MINERALS INC.)
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
April 30, 2011

NOTE 7 – RELATED PARTY TRANSACTIONS

As of April 30, 2011, a loan payable in the amount of $25,000 was due Ian A. Spowart (a director) of which the loan is non-interest bearing with no specific repayment terms.

Daniel Martinez-Atkinson and Ian A. Spowart, the officers and directors of the Company may, in the future, become involved in other business opportunities as they become available, thus they may face a conflict in selecting between the Company and their other business opportunities. The Company has not formulated a policy for the resolution of such conflicts.

NOTE 8 – STOCK TRANSACTIONS

Transactions, other than employees’ stock issuance, are in accordance with ASC No. 505. Thus issuances shall be accounted for based on the fair value of the consideration received. Transactions with employees’ stock issuance are in accordance with ASC No. 718. These issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, or whichever is more readily determinable.

On June 6, 2006 the Company issued a total of 30,000,000 shares of common stock to one director for cash in the amount of $0.0002 per share for a total of $6,000.

30,000,000 common shares were issued to 26 investors in the Company’s SB-2 offering for the aggregate sum of $60,000 in cash. The Regulation SB-2 offering was declared effective by the Securities and Exchange Commission on November 8, 2006 and completed on December 4, 2006.

Effective June 11, 2008 the Company effected a forward stock spilt of the authorized, issued and outstanding shares of common stock on a twenty five new for one old basis. Authorized capital increased from 75,000,000 common shares to 150,000,000 common shares and par value remained at $.001 per share. These financial statements have been retroactively restated to reflect these changes.

On September 8, 2009 the Company issued a total of 400,000 shares of common stock to one director for cash in the amount of $0.50 per share for a total of $200,000.

On April 8, 2010 the Company issued a total of 75,000 shares of common stock to a private investor for cash in the amount of $1.00 per share for a total of $75,000.

On June 6, 2010 the Company issued a total of 200,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $100,000.

On August 27, 2010 the Company issued a total of 211,864 shares of common stock to a private investor for cash in the amount of $0.59 per share for a total of $125,000.

10



LIBERTY ENERGY CORP.
(f/k/a DMA MINERALS INC.)
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
April 30, 2011

On September 28, 2010 the Company issued a total of 115,384 shares of common stock to a private investor for cash in the amount of $0.65 per share for a total of $75,000.

On October 29, 2010 the Company issued a total of 94,340 shares of common stock to a private investor for cash in the amount of $0.53 per share for a total of $50,000.

On December 8, 2010 the Company issued a total of 169,492 shares of common stock to a private investor for cash in the amount of $0.59 per share for a total of $100,000.

On February 14, 2011 the Company issued a total of 150,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $75,000.

On March 3, 2011 the Company issued a total of 200,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $100,000.

On April 25, 2011 the Company issued a total of 150,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $75,000.

As of April 30, 2011 the Company had 61,766,080 shares of common stock issued and outstanding.

NOTE 9 – STOCKHOLDERS’ EQUITY

The stockholders’ equity section of the Company contains the following classes of capital stock as of July 31, 2010:

Common stock, $ 0.001 par value: 150,000,000 shares authorized; 60,675,000 shares issued and outstanding.

11


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

FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to "US$" refer to United States dollars and all references to "common shares" refer to the common shares in our capital stock.

As used in this quarterly report, the terms “we”, “us”, “our” and “our company” refer to Liberty Energy Corp., unless otherwise indicated.

General Overview

Our company was incorporated in the State of Nevada on June 6, 2006 under the name DMA Minerals Inc.

Effective June 11, 2008, we effected a 25 for one forward stock split of our authorized and issued and outstanding common stock. As a result, our authorized capital increased from 75,000,000 to 1,875,000,000 shares of common stock and out outstanding share capital increased from 2,400,000 shares of common stock to 60,000,000 shares of common stock. In addition, effective June 11, 2008, as approved by our directors and a majority of our shareholders, we reduced our authorized capital from 1,875,000,000 shares of common stock to 150,000,000 shares of common stock.

Also effective June 11, 2008, we have changed our name from “DMA Minerals Inc.” to “Liberty Energy Corp.”. The change of name was approved by our directors and a majority of our shareholders.

Our principal executive offices are located at Two Allen Center, Suite 1600, 1200 Smith Street, Houston, TX 77002. Our telephone number is (713) 353-4700.

On September 22, 2009, we entered into a purchase and sales agreement with William C. Athens pursuant to which we agreed to acquire a total of 1/16th of 1% of 8/8ths overriding royalty interest in the A-Lovech exploration block in Bulgaria.

On October 1, 2009, we entered into an asset purchase and sale agreement with Trius Energy LLC, pursuant to which we acquired certain oil and gas assets from Trius Energy LLC in Jackson County, Texas.

12


As a result of these agreements, we refocused our management, entered the oil and gas business, and ceased all activity in our former business of mineral exploration. Our focus is now on the exploration, acquisition, development, production and sale of crude oil and natural gas. We are qualified to do business in the state of Texas under the name Liberty Energy Corp. We have not undergone bankruptcy, receivership, or any similar proceeding.

Subsequent to the end of the quarter covered by this report, the purchase of the 1/16th of 1% overriding royalty interest in the A-Lovech exploration block in Bulgaria had not been completed pursuant to the terms of the purchase and sales agreement with William C. Athens entered into on September 22, 2009. Because Mr. Athens passed away between the date the contract was executed and full payment was made, completion of the contract has been delayed pending notification from his estate. Negotiations are underway with his executors to settle this matter on the basis of acquiring 1/64th of the 1% interest in the A-Lovech exploration block. On April 28, 2011, Ms. Susan W. Athens, the executor for the estate of Mr. William C. Athens, executed an agreement to terminate the purchase and sale agreement between Liberty Energy Corp. and William C. Athens. Under the terms of the agreement Liberty Energy Corp. shall retain the 1/64th of the 1% interest in the A-Lovech exploration block and Mr. Athens’ estate shall retain the funds which were forwarded to Mr. Athens for this acquisition.

On July 19, 2010, we entered into a share issuance agreement with Asia Pacific Capital Ltd., a European institutional investor, whereby Asia Pacific shall make available up to $4,000,000 by way of advances until July 18, 2014, in accordance with the terms of the agreement. The completion date may be extended for an additional term of up to 12 months at the option of our company or Asia Pacific upon written notice on or before the completion date in accordance with the notice provisions of the agreement. Upon receipt of an advance from Asia Pacific under the terms of the agreement, we will issue to Asia Pacific that number of units of our company at a price that is the higher of either: (a) $0.50, or (b) 90% of the volume weighted average of the closing price of our company’s common stock on the Over-the-Counter Bulletin Board, for the 5 banking days immediately preceding the date of the advance, as quoted on Google Finance, or other source of stock quotes as agreed to by our company and Asia Pacific. As at the end of our current quarter covered by this report we have issued a total of 1,091,080 shares of our company to Asia Pacific for a total cash amount of $700,000 under the terms of the above mentioned agreement.

On March 8, 2011, we entered into a letter agreement to amend the share issuance agreement we entered into with Asia-Pacific Capital Ltd. on July 19, 2010. Pursuant to the terms of the share issuance agreement Asia-Pacific agreed to advance $4,000,000 to us and had the option to advance a further $4,000,000 once the initial amount had been exhausted. Pursuant to the terms of the letter agreement amending the original share issuance agreement Asia-Pacific has now committed to providing us with a total of $8,000,000 in advances despite the fact that the initial $4,000,000 has not yet been fully advanced.

We are continuing to work-over the Dalhstrom lease, Texas and are capitalizing those expenses in accordance with our oil and gas asset accounting policy. Our company follows the full-cost method of accounting for oil and natural gas properties. Under this method, all costs incurred in the exploration, acquisition, and development, including unproductive wells, are capitalized in separate cost centers for each country. Such capitalized costs include contract and concessions acquisition, geological, geophysical, and other exploration work, drilling, completing and equipping oil and gas wells, constructing production facilities and pipelines, and other related costs. We expect to have the work completed by the end of our current financial year end and expect to incur further expenses of approximately $30,000 for a sand lock to be performed to conclude the work-over.

We have completed work to the Lockhart lease, Texas and have capitalized the expenses in accordance with our oil and gas asset accounting policy as described above. We have successfully worked-over three wells, which are producing, and we are in the process of finalizing plans to drill a new test well to the Edwards formation.

Our Current Business

We are an oil and gas exploration company. Our business plan is to acquire oil and gas properties for exploration, appraisal and development with the intent to bring the projects to feasibility at which time we will either contract out the operations or joint venture the project to qualified interested parties. Our main priority will be given to projects with near term cash flow potential, although consideration will be given to projects that may not be as advanced from a technical standpoint but demonstrate the potential for significant upside.

13


Results of Operations

The following summary of our results of operations should be read in conjunction with our financial statements for the quarter ended April 30, 2011 which are included herein.

Three and nine month periods ending April 30, 2011 and 2010 and inception (June 6, 2006) to April 30, 2011

                            June 6,  
    Three     Three     Nine     Nine     2006  
    Months     Months     Months     Months     (Inception)  
    Ended     Ended     Ended     Ended     through  
    April 30,     April 30,     April 30,     April 30,     April 30,  
    2011     2010     2011     2010     2011  
Revenues $  15,403   $  1,377   $  15,403   $  3,149   $  18,599  
Expenses $  (100,230 ) $  (49,871 ) $  (261,356 ) $  (58,625 ) $  (418,147 )
Net Loss $  (84,827 ) $  (48,494 ) $  (245,953 ) $  (55,476 ) $  (399,448 )

Expenses

Our operating expenses for the three and nine month periods ended April 30, 2011 and 2010 and inception (June 6, 2006) to April 30, 2011 are outlined in the table below:

                            June 6,  
    Three     Three     Nine     Nine     2006  
    Months     Months     Months     Months     (Inception)  
    Ended     Ended     Ended     Ended     through  
    April 30,     April 30,     April 30,     April 30,     April 30,  
    2011     2010     2011     2010     2011  
Professional fees $  10,562   $  2,083   $  21,626   $  8,575   $  63600  
Depletion $ 4,167   $ -   $ 4,167   $ -   $ 4,167  
General and administrative $  85,501   $  47,788   $  235,563   $  50,050   $  350,380  

Operating expenses for the three months ended April 30, 2011, increased by $50,359 as compared to the comparative period in 2010. Operating expenses for the nine months ended April 30, 2011, increased by $202,731 as compared to the comparative period in 2010. The increase was primarily as a result of directors remuneration and increased general overheads.

Equity Compensation

We currently do not have any stock option or equity compensation plans or arrangements.

Liquidity and Financial Condition

Working Capital                  
   
At April 30,
At July 31,
   
Percentage
 
   
2011
2010
   
Increase/Decrease
 
Current Assets $  101,013   $ 77,356    
31%
 
Current Liabilities $  121,203   $  328,535    
(63)%
 
Working Capital $  (20,190 ) $ (251,179 )  
(92)%
 

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Cash Flows   Nine     Nine  
    Months     Months  
    Ended     Ended  
    April 30,     April 30,  
    2011     2010  
Net Cash Provided by (Used in) Operating Activities $  (447,667 ) $  247,399  
Net Cash Provided by (Used In) Investing Activities $  (127,059 ) $  (525,000 )
Net Cash Provided by Financing Activities $  599,975   $  300,000  
Net Increase In Cash During The Period $  25,249   $  22,399  

As of April 30, 2011, our company had a working capital deficit of $20,190.

Going Concern

We anticipate that additional funding will be required in the form of equity financing from the sale of our common stock. At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through a loan from our directors to meet our obligations over the next twelve months. We do not have any arrangements in place for any future debt or equity financing.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Contractual Obligations

As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.

Application of Critical Accounting Policies

Basis of Presentation

Our company reports revenue and expenses using the accrual method of accounting for financial and tax reporting purposes. Our company has elected a July 31, year-end.

Use of Estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.

Mineral Property Acquisition and Exploration Costs

Our company expenses all costs related to the acquisition and exploration of mineral properties in which it has secured exploration rights prior to establishment of proven and probable reserves. To date, our company has not established the commercial feasibility of any exploration prospects; therefore, all costs are being expensed.

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Oil and Gas Properties

Our company follows the full-cost method of accounting for oil and natural gas properties. Under this method, all costs incurred in the exploration, acquisition, and development, including unproductive wells, are capitalized in separate cost centers for each country. Such capitalized costs include contract and concessions acquisition, geological, geophysical, and other exploration work, drilling, completing and equipping oil and gas wells, constructing production facilities and pipelines, and other related costs.

The capitalized costs of oil and gas properties in each cost center are amortized on a composite units of production method based on future gross revenues from proved reserves. Sales or other dispositions of oil and gas properties are normally accounted for as adjustments of capitalized costs. Gain or loss is not recognized in income unless a significant portion of a cost center’s reserves is involved. Capitalized costs associated with acquisition and evaluation of unproved properties are excluded from amortization until it is determined whether proved reserves can be assigned to such properties or until the value of the properties is impaired. If the net capitalized costs of oil and gas properties in a cost center exceed an amount equal to the sum of the present value of estimated future net revenues from proved oil and gas reserves in the cost center and the lower of cost or fair value of properties not being amortized, both adjusted for income tax effects, such excess is charged to expense.

The Company began production on December 30, 2010, but does not yet have reserve reports. Depletion has been estimated using the straight line method and whenever reserve reports are obtained, the estimates may be revised to reflect actual production.

Advertising

Advertising costs have been charged to expense as incurred include public relations distribution expenses and were $2,731.25 for the quarter to April 30, 2011.

Recent Accounting Pronouncements Recently issued accounting pronouncements will have no significant impact on our company and its reporting methods.

Item 3. Quantitative Disclosures about Market Risks

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

Item 4. Controls and Procedures

Management’s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer) and our chief financial officer (our principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.

As of the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer) and our chief financial officer (our principal financial officer and principle accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer) and our chief financial officer (our principal financial officer and principle accounting officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.

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Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during our quarter ended April 30, 2011 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors

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

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

On February 14, 2011 we issued a total of 150,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $75,000. We have issued all of the shares to a non-US person (as that term is defined in Regulation S of the Securities Act of 1933) relying on Regulation S of the Securities Act of 1933.

On March 3, 2011 we issued a total of 200,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $100,000. We have issued all of the shares to a non-US person (as that term is defined in Regulation S of the Securities Act of 1933) relying on Regulation S of the Securities Act of 1933.

On April 25, 2011 we issued a total of 150,000 shares of common stock to a private investor for cash in the amount of $0.50 per share for a total of $75,000. We have issued all of the shares to a non-US person (as that term is defined in Regulation S of the Securities Act of 1933) relying on Regulation S of the Securities Act of 1933.

Item 3. Defaults Upon Senior Securities

None.

Item 4. [Removed and Reserved]

Item 5. Other Information

None.

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Item 6. Exhibits

Exhibit

 

No.

Description

(3)

Articles of Incorporation and Bylaws
3.1 Articles of Incorporation (Incorporated by reference from our Registration Statement on Form SB-2 filed on October 20, 2006).
3.2 By-laws (Incorporated by reference from our Registration Statement on Form SB-2 filed on October 20, 2006).
3.3 Certificate of Change with respect to the forward stock split (Incorporated by reference from our Current Report on Form 8-K filed on June 11, 2008).
3.4 Certificate of Amendment with respect to the change of name (Incorporated by reference from our Current Report on Form 8-K filed on June 11, 2008).
3.5 Certificate of Change with respect to the reduction of authorized capital (Incorporated by reference from our Current Report on Form 8-K filed on June 11, 2008).
(10) Material Contracts
10.1 Consulting Agreement between our company and Daniel Martinez-Atkinson dated February 11, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on February 16, 2010).
10.2 Consulting Agreement between our company and Ian Spowart, dated February 11, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on February 16, 2010).
10.3 Assignment and Bill of Sale with Phoenix Oil & Gas LLC dated March 30, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on April 14, 2010).
10.4 Assignment and Bill of Sale with Trius Operations LLC dated March 30, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on April 14, 2010).
10.5 Assignment and Bill of Sale with Trius Energy LLC dated March 30, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on April 14, 2010).
10.6 Purchase and Sale Agreement with William C. Athens dated March 30, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on April 14, 2010).
10.7 Share Issuance Agreement between Asia Pacific Capital Ltd. and our company dated July 19, 2010 (Incorporated by reference from our Current Report on Form 8-K filed on August 18, 2010).
10.8 Letter Agreement to amend Share Issuance Agreement between Asia Pacific Capital Ltd. and our company dated March 8, 2011 (Incorporated by reference from our Current Report on Form 8-K filed on March 11, 2011).
(31) Rule 13a-14(a) / 15d-14(a) Certifications
31.1* Certification filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Principal Executive Officer.
31.2* Certification filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Principal Financial Officer and Principal Accounting Officer.
(32) Section 1350 Certifications
32.1* Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Principal Executive Officer.
32.2* Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Principal Financial Officer and Principal Accounting Officer.

* Filed herewith

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

  LIBERTY ENERGY CORP.
  (Registrant)
   
   
Dated: June 13, 2011 /s/ “Ian A. Spowart”
  Ian A. Spowart
  President, Chief Executive Officer and Director
  (Principal Executive Officer)
   
   
Dated: June 13, 2011 /s/ “Daniel Martinez-Atkinson”
  Daniel Martinez-Atkinson
  Chief Financial Officer, Secretary, Treasurer and Director
  (Principal Financial Officer and Principal Accounting
  Officer )

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