Force Minerals (NUNC) 10-Q 2010 Q1 Quarterly report

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

FORM 10-Q

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

For the quarterly period endedFebruary 28, 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 No.000-52494

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

Nevada	98-0462664
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

708 11th Ave SW Suite 219, Calgary, Alberta, Canada T2R 0E4
(Address of principal executive offices) (zip code)

403-457-3672
(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.
Yes [x]     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 smaller reporting company. See 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	[ ]	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]

2

     APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS: Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

Yes [ ]      No[ ]N/A

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.47,344,000 shares of common stock as of April 13, 2010

3

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

FORCE ENERGY CORP.

(A Development Stage Company)

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

February 28, 2010

(Stated in US Dollars)

FORCE ENERGY CORP.

(A Development Stage Company)

INTERIM CONSOLIDATED BALANCE SHEETS

February 28, 2010 and November 30, 2009

(Stated in US Dollars)

(Unaudited)

		February 28			November 30
		2010			2009
ASSETS
Current
Cash	$	56,702		$	162,458
Prepaid expenses		5,538			1,216
		62,240			163,674
Property and equipment – Note 4		1,159			1,741
Oil and gas properties, full cost method of accounting Unproved Properties – Note 5		510,840			504,162
	$	574,239		$	669,577
LIABILITIES
Current
Accounts payable and accrued liabilities	$	51,275		$	58,798
Due to related parties - Note 6		131,722			113,550
		182,997			172,348
Asset retirement obligation – Note 7		10,697			10,225
		193,694			182,573
STOCKHOLDERS’ EQUITY
Preferred stock, $0.001 par value 10,000,000 shares authorized, none outstanding
Common stock, $0.001 par value – Note 8    270,000,000 shares authorized    47,344,000 shares issued (November 30, 2009, - 47,344,000 shares issued)		47,344			47,344
Additional paid in capital		1,717,952			1,717,952
Deficit accumulated during the development stage		(1,384,751	)		(1,278,292	)
		380,545			487,004
	$	574,239		$	669,577

Nature of Operations and Ability to Continue as a Going Concern – Note 2
Commitment – Note 9

SEE ACCOMPANYING NOTES

F-1

FORCE ENERGY CORP.

(A Development Stage Company)

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

for the three month periods February 28, 2010 and February 28, 2009 and

for the period from November 1, 2006 (Date of Inception)

to February 28, 2010

(Stated in US Dollars)

(Unaudited)

								Period from
								November 1,
		Three Months			Three Months			2006 (Date of
		Ended			Ended			Inception) to
		February 28			February 28			February 28
		2010			2009			2010
								(cumulative)
Expenses
Accounting and audit fees	$	38,788		$	32,933		$	212,818
Accretion expense – Note 7		472			-			1,800
Bank charges		190			499			2,286
Consulting fees		-			-			408,500
Depreciation		582			582			3,492
Exploration expenses		-			-			15,000
Investor relations		-			8,000			51,443
Legal fees		7,252			11,163			147,434
Management fees – Note 6		47,250			47,250			393,750
Office expenses		3,755			403			27,367
Rent – Note 6		3,150			5,587			37,094
Tax penalties and interest		-			-			-
Transfer and filing fees		2,413			594			61,847
Travel		-			-			9,502
Write-off of oil and gas costs – Note 5 (b)		-			-			20,000
Loss before other items		(103,852	)		(107,011	)		(1,392,333	)
Other items:
Debt forgiveness		-			-			610
Foreign exchange gain (loss)		(2,607	)		(230	)		6,972
		(2,607	)		(230	)		7,582
Net loss and comprehensive loss for the period	$	(106,459	)	$	(107,241	)	$	(1,384,751	)
Basic loss per share	$	(0.01	)	$	(0.00	)
Weighted average number of shares outstanding		47,344,000			45,994,000

SEE ACCOMPANYING NOTES

F-2

FORCE ENERGY CORP.

(A Development Stage Company)

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

for the three month periods ended February 28, 2010 and February 28, 2009 and

for the period from November 1, 2006 (Date of Inception) to February 28, 2010

(Stated in US Dollars)

								Period from
								November 1,
		Three Months			Three Months			2006 (Date of
		Ended			Ended			Inception) to
		February 28			February 28			February 28
		2010			2009			2010
								(cumulative)
Cash Flows used in Operating Activities
Net loss for the period	$	(106,459	)	$	(107,241	)	$	(1,384,751	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Consulting fees paid in stock		-			-			405,000
Debt forgiveness		-			-			(610	)
Accretion expense		472			-			1,706
Depreciation		582			582			3,492
Write-off of oil and gas costs		-			-			20,000
Changes in non-cash working capital items
related to operations:
Deposits		-			12,044			-
Prepaid expenses		(4,322	)		268			(5,538	)
Accounts payable and accrued liabilities		(7,523	)		3,166			12,123
Due to related parties		18,172			(9,250	)		131,722
Net cash used in operating activities		(99,078	)		(100,431	)		(816,762	)
Cash Flows used in Investing Activities
Advance of loan receivable		-			(175,000	)		-
Acquisition of property and equipment		-			-			(4,651	)
Acquisition and development costs of oil and gas properties		(6,678	)		(38,938	)		(364,891	)
Net cash used in investing activities		(6,678	)		(213,938	)		(369,542	)
Cash Flows provided by Financing Activities
Capital stock issued		-			-			1,219,000
Cash acquired on reverse acquisition		-			-			37,058
Net cash provided by financing activities		-			-			1,256,058
Effect of foreign currency translation		-			-			(13,052	)
Increase (decrease) in cash during the period		(105,756	)		(314,369	)		56,702
Cash, beginning of the period		162,458			458,940			-
Cash, end of the period	$	56,702		$	144,571		$	56,702
Supplemental disclosure of cash flow information
Interest paid	$	-		$	-		$	-
Income taxes paid	$	-		$	-		$	-

SEE ACCOMPANYING NOTES

F-3

FORCE ENERGY CORP.

(A Development Stage Company)

INTERIM CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

for the period from November 1, 2006 (Date of Inception) to February 28, 2010

(Stated in US Dollars)

(Unaudited)

									Deficit
									Accumulated
						Additional			During the
		Common Shares				Paid-in			Development
		Number		Par Value		Capital			Stage			Total
Capital stock issued for cash	– at $0.005	23,000,000	$	23,000	$	92,000		$	-		$	115,000
Less: commissions		-		-		(8,000	)		-			(8,000	)
Net loss and comprehensive loss for the period		-		-		-			(8,944	)		(8,944	)
Balance, November 30, 2006		23,000,000		23,000		84,000			(8,944	)		98,056
Pursuant to agreement of merger and plan of reorganization		21,354,000		21,354		(24,058	)		-			(2,704	)
Capital stock issued for cash	– at $0.25	240,000		240		59,760			-			60,000
	– at $0.50	100,000		100		49,900			-			50,000
Net loss and comprehensive loss for the year		-		-		-			(79,859	)		(79,859	)
Balance November 30, 2007		44,694,000		44,694		169,602			(88,803	)		125,493
Capital stock issued for cash	– at $0.75	1,000,000		1,000		749,000			-			750,000
Pursuant to consulting service agreements	– at $1.35	300,000		300		404,700			-			405,000
Net loss and comprehensive loss for the year		-		-		-			(786,407	)		(786,407	)
Balance November 30, 2008		45,994,000		45,994		1,323,302			(875,210	)		494,086
Capital stock issued for cash	- at 0.28	900,000		900		251,100			-			252,000
Capital stock issued for oil and gas property – Note 5(b)		450,000		450		143,550			-			144,000
Net loss and comprehensive loss for the year		-		-		-			(403,082	)		(403,082	)
Balance November 30, 2009		47,344,000		47,344		1,717,952			(1,278,292	)		487,004
Net loss and comprehensive loss for the period		-		-		-			(106,459	)		(106,459	)
Balance February 28, 2010		47,344,000	$	47,344	$	1,717,952		$	(1,384,751	)	$	380,545

SEE ACCOMPANYING NOTES

F-4

FORCE ENERGY CORP.

(A Development Stage Company)

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

February 28, 2010

(Stated in US Dollars)

(Unaudited)

Note 1	Interim Reporting
	The unaudited financial information furnished herein reflects all adjustments, which in the opinion of management are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented. All adjustments are of a normal recurring nature. These interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s audited consolidated financial statements for the fiscal year ended November 30, 2009. The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal period and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. Accordingly, footnote disclosure, which would substantially duplicate the disclosure contained in the Company’s audited consolidated financial statements for the fiscal year ended November 30, 2009, has been omitted. The results of operations for the three-month period ended February 28, 2010 are not necessarily indicative of results for the entire year ending November 30, 2010.
Note 2	Nature of Operations and Ability to Continue as a Going Concern
	The Company was incorporated in the state of Nevada, United States of America on November 1, 2006. The Company was formed for the purpose of acquiring exploration and development stage natural resource properties. The Company’s year-end is November 30.
	Effective December 28, 2006, the Board of Directors authorized a 3 for 1 forward stock split on the common shares. The authorized number of common shares increased from 90,000,000 to 270,000,000 common shares with a par value of $0.001.
	On February 12, 2008, the Company acquired 100% of the common shares of Force Energy Corp. an inactive company incorporated in Nevada on July 19, 2005, for $100, to effect a name change of the Company. On February 12, 2008, the Company and Force Energy Corp filed articles of merger with the Secretary of State of Nevada to effectuate a merger between the two companies. The surviving entity of the merger was the Company. Immediately thereafter the Company changed its name to Force Energy Corp.
	These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next twelve months. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At February 28, 2010, the Company has a working capital deficiency of $120,757. The Company has yet to achieve profitable operations, has accumulated losses of $1,384,751 since its inception and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has entered into a formal Share Issuance Agreement with a third party (Note 9) to address this concern.

F-5

FORCE ENERGY CORP.

(A Development Stage Company)

Notes to the Interim Consolidated Financial Statements

February 28, 2010

(Stated in US Dollars)

(Unaudited)– Page 2

Note 3	New Accounting Standards
	On December 1, 2009 the Company adopted the guidance in Accounting Standards
	Codification (“ASC”) 805, “Business Combinations”. ASC 805 establishes principles and requirements for how the acquirer in a business combination (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquired business; (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The adoption of this statement had no effect on the Company’s reported financial position or results of operations.
	On December 1, 2009, the Company adopted the newly ratified guidance which is part of ASC 815-40, “Contracts in Entity’s Own Equity”. ASC 815-40 provides guidance for determining whether an equity-linked financial instrument (or embedded feature) is indexed to an entity’s own stock. The adoption of this statement had no effect on the Company’s reported financial position or results of operations.
	On December 1, 2009, the Company became subject to revised reporting requirements relating to oil and natural gas reserves that a company holds, which were prescribed by the SEC. Included in the new rule entitled -Modernization of Oil and Gas ReportingRequirements”,are the following changes: 1) permitting use of new technologies to determine proved reserves, if those technologies have been demonstrated empirically to lead to reliable conclusions about reserve volumes; 2) enabling companies to additionally disclose their probable and possible reserves to investors, in addition to their proved reserves; 3) allowing previously excluded resources, such as oil sands, to be classified as oil and natural gas reserves rather than mining reserves; 4) requiring companies to report the independence and qualifications of a preparer or auditor, based on current Society of Petroleum Engineers criteria; 5) requiring the filing of reports for companies that rely on a third party to prepare reserve estimates or conduct a reserve audit; and 6) requiring companies to report oil and natural gas reserves using an average price based upon the prior 12-month period, rather than year-end prices. The new reporting requirements are applicable to registration statements filed on or after January 1, 2010, and for annual reports on Form 10K for fiscal years ending on or after December 31, 2009. As at February 28, 2010, the Company has no proved or probable reserves and is therefore not subject to the reporting requirement. The adoption of these reporting requirements will result in increased disclosures to the financial statements once the Company has proved and probable reserves.
	On December 1, 2009 Accounting Standards Update (ASU) No. 2010-03 - “Oil and GasReserve Estimation and Disclosures.”became effective for the Company. The guidance requires additional disclosures to be made relating to current oil and gas reserve estimation. The adoption of these reporting requirements will result in increased disclosures to the financial statements once the Company has proved and probable reserves.

F-6

FORCE ENERGY CORP.

(A Development Stage Company)

Notes to the Interim Consolidated Financial Statements

February 28, 2010

(Stated in US Dollars)

(Unaudited)– Page 3

Note 4	Property and Equipment
	Property and equipment consists of the following:

		February 28,			November 30
		2010			2009
Computer equipment and software	$	4,275		$	4,275
Less: Accumulated depreciation		(3,210	)		(2,675	)
		1,065			1,600
Office equipment		376			376
Less: Accumulated depreciation		(282	)		(235	)
		94			141
	$	1,159		$	1,741

Note 5 Oil and Gas Properties

		February 28, 2010
		United
		States		Canada		Total
Unproved properties
- acquisition costs	$	369,000	$	119,640	$	488,640
- development costs		6,678		7,100		13,778
- asset retirement obligation		-		8,422		8,422
	$	375,678	$	135,162	$	510,840

		November 30, 2009
		United
		States		Canada		Total
Unproved properties
- acquisition costs	$	369,000	$	119,640	$	488,640
- development costs		-		7,100		7,100
- asset retirement obligation		-		8,422		8,422
	$	369,000	$	135,162	$	504,162

a)	Hayter Prospect, Alberta, Canada
	By a participation agreement dated December 21, 2006, Nuance Exploration Ltd. (“NEL”), a wholly owned subsidiary of the Company acquired a 100% ownership in the interpretation of 3D seismic data covering four sections of certain land, known as the Hayter Prospect, located in the province of Alberta, Canada by paying $82,650 (CDN$95,000) in costs of acquiring and interpreting the seismic data.

F-7

FORCE ENERGY CORP.

(A Development Stage Company)

Notes to the Interim Consolidated Financial Statements

February 28, 2010

(Stated in US Dollars)

(Unaudited)– Page 4

Note 5	Oil and Gas Properties– (cont’d)
		On October 15, 2007, prior to the evaluation of the 3D seismic data, NEL sold to the original grantor (the Grantor) its 100% interest in the subject property and received as consideration a non-interest bearing promissory note for $111,144 (CDN$110,000) to be repaid by November 30, 2007.
		On November 30, 2007, the Grantor did not pay the promissory note and NEL and the Grantor entered into a Participation Agreement whereby NEL accepted a 20% interest of the Grantor’s working interest in the County Line 10D Hayter 10-8-40-1 W4M well as full and final settlement of the promissory note totalling $95,702 after considering the effects of the foreign exchange on the note.
		On October 16, 2009, the Company entered into an amendment to its Participation Agreement pursuant to which it acquired an additional 30% working interest in the Hayter Well in consideration of a release by Force from an amount of $23,938 owed by the Grantor to the Company. The Company holds a 50% working interest of the Grantor’s interest in the Hayter Well. The addendum was subsequently amended by the parties on February 1, 2010 to replace the reference to the Company in the agreement with Nuance Exploration Ltd., the Company’s wholly owned subsidiary.
		During the year ended November 30, 2009 the Company incurred $7,100 of development costs.
		As at February 28, 2010, the 50% working interest of the Hayter Well was recorded at $135,162 (November 30, 2009:- $135,162). The company also recorded $10,697 (November 30, 2009 - $10,225) as an asset retirement obligation (Note 7).
	b)	Diamond Springs Prospect, Wyoming
		By a letter agreement dated March 11, 2008, the Company agreed to purchase a 5% working interest in the Diamond Springs Prospect (the “Prospect”) and acquire an option to purchase an additional 20% working interest in the Prospect.
		As consideration, the Company issued a $50,000 Promissory Note without interest due on or before April 30, 2008 (settled April 16, 2008), and agreed to pay $300,000 within 90 days of the execution of an acquisition agreement (see agreement related to Diamond Springs Prospect below), at which time the Company would earn a 75% net revenue interest in the initial well. The Company is responsible for 100% of the costs of the drilling and testing of the initial well on the Prospect.
		Upon drilling of the initial well, the Company would issue to the vendor 250,000 common shares of the Company as payment in full for a 5% working interest in all subsequent wells drilled on the Prospect. These shares were not issued and the commitment to issue these shares was superseded in June, 2009 as described below. The Vendor granted the Company the option to purchase up to an additional 20% working interest in all subsequent wells drilled on the Prospect for $100,000 per 1% of working interest. This option expired unexercised on December 15, 2008.

F-8

FORCE ENERGY CORP.

(A Development Stage Company)

Notes to the Interim Consolidated Financial Statements

February 28, 2010

(Stated in US Dollars)

(Unaudited)– Page 5

Note 5	Oil and Gas Properties– (cont’d)
	b)	Diamond Springs Prospect, Wyoming– (cont’d)
		In December 2008, the Company advanced an additional $175,000, pursuant to the loan agreement dated March 11, 2009, to the vendor of the Diamond Springs Prospect with the intention that this loan, together with the original payment of $50,000, are to be included as part of the purchase price included in a definitive agreement in respect to the acquisition by the Company of a working interest in the Prospect.
		In June 2009, the parties entered into the assignment agreement, which replaced and superseded all prior agreements between the parties. The Company received a 50% interest in the Diamond Springs Prospect for $225,000. In connection with the assignment agreement the Company agreed to sign a release in favour of the assignor, releasing them from all further obligations under the loan agreement and the letter agreement.
		On September 16, 2009, the Company acquired a further 25% interest in the Diamond Springs Prospect for consideration consisting of 450,000 common shares with a fair value of $144,000.
		During the year ended November 30, 2009, $20,000 in development costs relating to Diamond Springs Prospect were written off.
		During the three month period ended February 28, 2010, the Company incurred $6,678 of exploration expenditures on the Diamond Springs Prospect.

Note 6	Related Party Transactions
	Amount due to related parties includes $131,722 (November 30, 2009 - $113,550); owing to the Company’s director and companies controlled by the Company’s director for unpaid corporate expenses of $3,422 (November 30, 2009 - $nil) unpaid management fees of $128,300 (November 30, 2009 - $111,500) and rent of $nil (November 30, 2009 - $2,050) respectively. The amount due to related party was due to the Company’s former director and is unsecured, non-interest bearing and has no specific terms for repayment.
	During the three month period ended February 28, 2010, total management fees charged by the Company’s director were $47,250 (February 28, 2009- $47,250), and rent expenses reimbursed to the company controlled by the Company’s director were $3,150 (February 28, 2009 - $nil).
Note 7	Asset Retirement Obligation
	Total future asset retirement obligations were estimated by management based on the Company’s net ownership interest, estimated costs to reclaim and abandon the wells and the estimated timing of the costs to be incurred in future periods. The Company has estimated the net present value of its total assets retirement obligations at February 28, 2010 to be $10,697 (November 30, 2009 - $10,225), based on a total undiscounted liability of $16,645 (Cdn$17,500) in the Hayter Prospect, Alberta, Canada. These payments are expected to be made over the next nine years, with the majority of the cost incurred between 2016 and 2019. The Company’s credit adjusted risk free rate of 15% and an inflation rate of 8% were used to calculate the present value of the asset retirement obligation.

F-9

FORCE ENERGY CORP.

(A Development Stage Company)

Notes to the Interim Consolidated Financial Statements

February 28, 2010

(Stated in US Dollars)

(Unaudited)– Page 6

Note 7 Asset Retirement Obligation– (cont’d)

		February 28,		November 30,
		2010		2009
Balance, beginning of period	$	10,225	$	-
Liabilities incurred		-		8,422
Accretion expense		472		1,328
Effect of foreign exchange		-		475
	$	10,697	$	10,225

Note 8	Capital Stock
	During the period ended November 30, 2006, the Company issued 23,000,000 common shares at $0.005 for total proceeds of $115,000. The Company paid commissions of $8,000 for net proceeds of $107,000.
	On December 29, 2006, the Company issued 21,354,000 common shares as a result of the reverse merger and recapitalization.
	On April 5, 2007, the Company issued 240,000 common shares at $0.25 per share for total proceeds of $60,000 pursuant to a private placement.
	On November 30, 2007, the Company issued 100,000 common shares at $0.50 per share for total proceeds of $50,000 pursuant to a private placement.
	On April 16, 2008, the Company agreed to issue 300,000 common shares (issued May 2008) with a fair value of $1.35 per share totalling $405,000 pursuant to three consultancy contracts.
	On April 17, 2008, the Company issued 1,000,000 common shares at $0.75 per share for total proceeds of $750,000 pursuant to a private placement.
	On September 19, 2009, the Company issued 450,000 common shares pursuant to the Diamond Springs Prospect property agreement with a fair value of $144,000.
	On October 30, 2009, the Company issued 900,000 common shares at $0.28 per share for total proceeds of $252,000 pursuant to a private placement.
Note 9	Commitment
	The Company entered into a share issuance agreement for gross proceeds of up to $5,000,000 which expires on November 9, 2010. Pursuant to the agreement the Company can request advances in amounts not less than $100,000 from the subscriber, and the subscriber will receive within 5 days of the advance being received common shares of the Company. The deemed issue price of the shares shall be 80% of the volume weighted average of the closing price of the common stock for the ten banking days immediately prior to the date advance was requested.

F-10

4

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

Forward-Looking Statements

This quarterly report contains forward-looking statements as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the United States Securities Exchange Act of 1934. 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”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “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, including the risks in the section entitled “Risk and Uncertainties”, 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.

Financial information contained in this quarterly report and in our unaudited interim financial statements is stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles. The following discussion should be read in conjunction with our unaudited interim financial statements and the related notes that appear elsewhere in this quarterly report.

As used in this quarterly report, the terms “we”, “us”, “our” and “Force” means Force Energy Corp. and its subsidiaries, unless otherwise indicated.

Our Current Business

We are currently engaged in the business of identifying, evaluating, and qualifying potential natural gas and oil wells; investing in interests in those wells with the goal of producing commercially marketable quantities of oil and natural gas. The majority of our business is derived from projects identified by our principals. Our strategy is to identify low to moderate risk oil and natural gas reserves by reviewing and reprocessing previously recorded seismic data with a view to a deeper target in our analysis than when the data was originally recorded. This approach allows us to evaluate potential oil and natural gas sites for development without the operational and financial commitment which would be required to record new seismic data on comparable sites. By entering into participation agreements with companies which have possession of such seismic data, our operational costs are limited to the cost of analysis until such time as we have identified reserves for development. We intend to expand our operations into these areas of activity should we establish sufficient cash flows in the next twelve months to support these activities. We presently hold a 50% working interest of the County Line Energy Corp. interest in the Hayter Well located in Alberta, Canada, and a 75% working interest in the Diamond Springs Prospect located within the Wind River Basin, Wyoming.

County Line Energy Corp. is the operator of the Hayter well. As of the date of this quarterly report, the Hayter well has been cased and cemented in anticipation of the completion of the drill program. County Line plans to enter the Hayter well, perforate the potential pay zone(s) and conduct regular production testing of the zone(s). Should the testing confirm adequate oil reserves and potential economic flow rates, County Line is expected to install adequate pumping equipment and other surface facilities in anticipation of the projected flow rates. Currently, there are no known oil reserves on the Hayter well.

We are the operator of the Diamond Springs Prospect being the largest working interest partner. Continental Production Co. has been sub contracted by us to be our operator in the field. Continental has been hired to permit two wells in section nine of the property. Once the new geothermal work is complete by Hawkeye Geosensing Ltd., the company may stake wells in other sections. Once the well locations are staked, the company intends to apply for drilling permits to be ready for this summer’s drilling season.

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We did not earn any revenues during the three months ended February 28, 2010. We do not anticipate earning revenues until identifiable reserves are discovered and exploited from the Hayter well, the Diamond Springs Prospect, or from any other properties or projects in which we hold a working or direct interest.

As of the date of this quarterly report the status of our agreements respecting our oil and gas properties is as follows:

(i)	Hayter Well.During our first fiscal quarter of 2009 we advanced $23,938 (CDN$29,000) to County Line Energy Corp for costs and expenses associated with the Hayter Well as an unsecured loan. On October 16, 2009 we entered into an amendment to our participation agreement with County Line pursuant to which we acquired an additional 30% working interest in the Hayter Well in consideration of a release by Force from all amounts owed by County Line to Force. Following our entry into the amended participation agreement we now hold a 50% working interest of the County Line Energy Corp. interest in the Hayter Well.
	On March 9, 2009, Force received a report on reserves data for the Hayter Well prepared by its independent engineers. The report was prepared in accordance with the standards set out in the Canadian Oil and Gas Evaluation Handbook (COGE handbook). The reserves data are estimates of proved reserves and probable reserves and related future net revenue as at November 30, 2008.
(ii)	Diamond Springs Prospect.On March 11, 2009 we entered into a loan agreement with G2 Petroleum, LLC pursuant to which we advanced to G2 Petroleum, LLC $175,000. The loan was intended to form part of the purchase price for our acquisition of a working interest in the Diamond Springs Prospect. As consideration for the advance of the loan, G2 Petroleum agreed that the $50,000 paid by us under the prior letter agreement between the parties would be included as part of the purchase price of a new agreement between the parties respecting the acquisition of G2 Petroleum’s working interest in the Diamond Springs Prospect. The loan is unsecured and payable on demand.
	On July 9, 2009 we completed the acquisition of a 50% interest in the Diamond Springs Prospect in accordance with the terms of an assignment agreement with G2 Petroleum, LLC dated effective June 20, 2009. Pursuant to the terms of the assignment agreement, in consideration of the transfer of the 50% interest in the Diamond Springs Prospect we agreed to set-off $50,000 of G2’s indebtedness to us under the prior letter agreement between the parties and we agreed to set-off $175,000 against G2’s indebtedness under the loan agreement between the parties dated March 11, 2009. In connection with the assignment agreement we agreed to sign a release in favor of G2, releasing them from all further obligations under the loan agreement and the letter agreement.
	Effective September 16, 2009 we completed the acquisition of a further 25% interest in the Diamond Springs Prospect in accordance with the terms of an assignment agreement with G2 Petroleum, LLC dated effective September 16, 2009. Pursuant to the terms of the assignment agreement, in consideration of the purchase of a 25% working interest in the Diamond Springs Prospect we agreed to issue G2 Petroleum 450,000 common shares at a price of $0.32 per common share for total consideration of $144,000. Following completion of the acquisition, we currently hold a 75% working interest in the Diamond Springs Prospect located within the Wind River Basin, Wyoming.
	We did not earn any revenues during the three months ended February 28, 2010. We do not anticipate earning revenues until identifiable reserves are discovered and exploited from the Hayter well, Diamond Springs Prospect, or from any other properties or projects in which we hold a working or direct interest.

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The following summary of our results of operations should be read in conjunction with our unaudited consolidated financial statements for the three month period ended February 28, 2010 which are included herein.

Our operating results for the three month period ended February 28, 2010 and February 28, 2009 are summarized as follows:

		Three Month Period Ended
		February 28,		February 28,
		2010		2009
Revenue	$	-	$	-
Operating Expenses		103,852		107,011
Net Loss and Comprehensive Loss	$	106,459	$	107,241

Revenues

We have not earned any revenues to date, and do not anticipate earning revenues until such time as we encounter commercially productive oil or gas reservoirs on our oil and gas prospects. All of our oil and gas prospects are undeveloped. The significant reduction in the price of oil following the global economic crises has materially affected our anticipated revenue stream from our property interests. As a result of the current low price of oil, our company will continue to incur expenses in excess of the revenues generated from our properties. We anticipate that we will have to address the cash shortfall through additional equity financings in the future. We can offer no assurance, however, that such financings will be available on terms acceptable to our company. We also intend to generate additional funds in the future through increased output following our company’s plan to increase the number of wells on our producing properties.

Expenses

Our expenses for the three month period ended February 28, 2010 and February 28, 2009 are outlined in the table below:

		Three Month Period Ended			Percentage
					Increase /
					(Decrease)
		February 28,		February 28,
		2010		2009
Accounting and audit fees	$	38,788	$	32,933	17.8%
Accretion expense		472		-	100%
Bank charges		190		499	(61.9%	)
Depreciation		582		582	N/A
Investor relations		-		8,000	(100%	)
Legal fees		7,252		11,163	(35%	)
Management fees		47,250		47,250	N/A
Office expenses		3,755		403	831.8%
Rent		3,150		5,587	(43.6%	)
Transfer and filing fees		2,413		594	306.2%
Total Expenses	$	103,852	$	107,011	(2.9%	)

Our expenses decreased by 2.9% for the quarter ended February 28, 2010 as compared to the quarter ended February 28, 2009. The decrease in our expenses for the quarter ended February 28, 2010 was due mainly to a reduction in investor relations expenses.

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Liquidity and Capital Resources

Working Capital

		As at			As at		Percentage
		February 28,			November 30,		Increase /
		2010			2009		(Decrease)
Current assets	$	62,240		$	163,674		(61.9%	)
Current liabilities	$	182,997		$	172,348		6.2%
Working capital deficiency	$	(120,757	)	$	(8,674	)	1,292.2%

Cash Flows

		Three Month			Three Month		Percentage
		Period Ended			Period Ended		Increase /
		February 28, 2010			February 28, 2009		(Decrease)
Net cash used in operating activities	$	(99,078	)	$	(100,431	)	(1.3%	)
Net cash used in investing activities	$	(6,678	)	$	(213,938	)	(96.9%	)
Net cash provided by financing activities	$	-		$	-		N/A
Effect of foreign currency translation	$	-		$	-		N/A
Increase (decrease) in cash	$	(105,756	)	$	(314,369	)	(66.4%	)

We anticipate that we will incur approximately $1,000,000 for operating expenses, including, legal, accounting and audit expenses associated with our reporting requirements as a public company under the Exchange Act during the next twelve months.

Cash Used In Operating Activities

We used cash in operating activities in the amount of $99,078 during the three month period ended February 28, 2010 and $100,431 during the three month period ended February 28, 2009. Cash used in operating activities was funded by cash on hand at the end of each of the prior fiscal years.

Cash Used In Investing Activities

We used cash in investing activities in the amount of $6,678 during the three month period ended February 28, 2010 and $213,938 during the three month period ended February 28, 2009. Cash used in investing activities was funded by cash on hand at the end of each of the prior fiscal years.

Cash Provided by Financing Activities

No cash was provided by financing activities during the three month periods ended February 28, 2010 and February 28, 2009.

Disclosure of Outstanding Share Data

As at the date of this quarterly report, we had 47,344,000 shares of common stock issued and outstanding. We do not have any warrants, options or shares of any other class issued and outstanding as at the date of this quarterly report.

Going Concern

Due to our being an exploration stage company and not having generated revenues, in their report on our audited financial statements for the year ended November 30, 2009, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern.

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We have historically incurred losses, and through February 28, 2010 have incurred losses of $1,384,751 since our inception. Because of these historical losses, we will require additional working capital to develop our business operations. We intend to raise additional working capital through private placements, public offerings, bank financing and/or advances from related parties or shareholder loans.

The continuation of our business is dependent upon obtaining further financing and achieving a break even or profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current or future stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

There are no assurances that we will be able to either achieve a level of revenues adequate to generate sufficient cash flow from operations, or obtain additional financing through either private placements, public offerings and/or bank financing necessary to support our working capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, we will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to us. If adequate working capital is not available we may not increase our operations or continue with our exploration or development plan.

These conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might be necessary should we be unable to continue as a going concern.

Future Financings

To date we have had negative cash flows from operations and we have been dependent on sales of our equity securities and debt financing to meet our cash requirements and have incurred a net loss of $106,459 for the three month period ended February 28, 2010. As of February 28, 2010, we had working capital deficit of $120,757 and our estimated expenses over the next twelve months are $1,000,000. We do not expect positive cash flow from operations in the near term. Accordingly we will be required to obtain additional financing to fund our operations for the next twelve months.

We will depend almost exclusively on outside capital to pay for the continued exploration and development of our properties. Such outside capital may include the sale of additional stock and/or commercial borrowing. Capital may not continue to be available if necessary to meet these continuing development costs or, if the capital is available, that it will be on terms acceptable to us. The issuance of additional equity securities by us would result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, we may be unable to continue our business and as a result may be required to scale back or cease operations for our business, the result of which would be that our stockholders would lose some or all of their investment.

On November 16, 2009 the company entered into a share issuance agreement for gross proceeds of up to $5,000,000 which expires on November 9, 2010. Pursuant to the agreement the company can request advances in amounts not less than $100,000 from the subscriber, and the subscriber will receive within 5 days of the advance being received common shares of the company. The deemed issue price of the shares shall be 80% of the volume weighted average of the closing price of the common stock for the ten banking days immediately prior to the date advance was requested. The company has not yet drawn any funds under this agreement.

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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 are material to stockholders.

Risks and Uncertainties

Much of the information included in this quarterly report includes or is based upon estimates, projections or other forward-looking statements. Such forward looking statements include any projections or estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.

Such estimates, projections or other forward-looking statements involve various risks and uncertainties as outlined below. We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other forward-looking statements. Prospective investors should consider carefully the risk factors set out below.

We have had negative cash flows from operations.

To date we have had negative cash flows from operations and we have been dependent on sales of our equity securities and debt financing to meet our cash requirements and have incurred losses totalling approximately $106,459 for the three month period ended February 28, 2010. As of February 28, 2010, we had working capital deficit of $120,757. We do not expect positive cash flow from operations in the near term. Our independent auditors have noted in their report concerning our annual financial statements for the fiscal year ended November 30, 2009 that we have incurred substantial losses since inception, which raises substantial doubt about our ability to continue as a going concern. In the event we are not able to continue operations you will likely suffer a complete loss of your investment in our securities. There is no assurance that actual cash requirements will not exceed our estimates. In particular, additional capital may be required in the event that:

• drilling and completion costs increase beyond our expectations; or

• we encounter greater costs associated with general and administrative expenses or operating costs.

Due to our being an exploration stage company and not having generated revenues, in their report on our audited financial statements for the year ended November 30, 2009, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern.

We have historically incurred losses, and through February 28, 2010 have incurred losses of $1,384,751 since our inception. Because of these historical losses, we will require additional working capital to develop our business operations. On November 16, 2009 to address our working capital concerns we entered into a share issuance agreement with Villa Atmu S.A., pursuant to which Villa Atmu agreed to advance to us up to US$5,000,000 in exchange for shares of common stock of our company. We intend to raise additional working capital through private placements, public offerings, bank financing and/or advances from related parties or stockholder loans.

The continuation of our business is dependent upon obtaining further financing and achieving a break even or profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current or future stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

There are no assurances that we will be able to either (1) achieve a level of revenues adequate to generate sufficient cash flow from operations; or (2) obtain additional financing through either private placements, public offerings and/or bank financing necessary to support our working capital requirements.

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To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, we will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to us. If adequate working capital is not available we may not increase our operations. These conditions raise substantial doubt about our ability to continue as a going concern.

We depend on outside capital to pay for the exploration and development of our properties

We depend almost exclusively on outside capital to pay for the continued exploration and development of our properties. Such outside capital may include the sale of additional stock and/or commercial borrowing. Capital necessary to meet these continuing exploration and development costs may not continue to be available or, if the capital is available, it may not be available on terms acceptable to us. The issuance of additional equity securities by us would result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, we may be unable to continue our business and as a result may be required to scale back or cease operations for our business, the result of which would be that our stockholders would lose some or all of their investment.

A decline in the price of our common stock could affect our ability to raise further working capital and adversely impact our operations.

A prolonged decline in the price of our common stock could result in a reduction in the liquidity of our common stock and a reduction in our ability to raise capital. Because our operations have been primarily financed through the sale of equity securities, a decline in the price of our common stock could be especially detrimental to our liquidity and our continued operations. Any reduction in our ability to raise equity capital in the future would force us to reallocate funds from other planned uses and would have a significant negative effect on our business plans and operations, including our ability to continue our current operations. If our stock price declines, we may not be able to raise additional capital or generate funds from operations sufficient to meet our obligations.

We have a history of losses and fluctuating operating results.

From inception through to February 28, 2010, we have incurred aggregate losses of approximately $1,384,751. Our net loss for the three month period ended February 28, 2010 was $106,459 and $107,241 for the three month period ended February 28, 2009. There is no assurance that we will operate profitably or will generate positive cash flow in the future. In addition, our operating results in the future may be subject to significant fluctuations due to many factors not within our control, such as the general economic cycle, the market price of oil and gas and exploration and development costs. If we cannot generate positive cash flows in the future, or raise sufficient financing to continue our normal operations, then we may be forced to scale down or even close our operations.

Until such time as we generate revenues, we expect an increase in development costs and operating costs. Consequently, we expect to incur operating losses and negative cash flow until our properties enter commercial production, if any.

We have a limited operating history and if we are not successful in continuing to grow our business, then we may have to scale back or even cease our ongoing business operations.

We have no history of revenues from operations and have no significant tangible assets. We have yet to generate positive earnings and there can be no assurance that we will ever operate profitably. Our company has a limited operating history and must be considered in the development stage. The success of our company is significantly dependent on a successful acquisition, drilling, completion and production program. Our company’s operations will be subject to all the risks inherent in the establishment of a developing enterprise and the uncertainties arising from the absence of a significant operating history. We may be unable to locate recoverable reserves or operate on a profitable basis. We are in the development stage and potential investors should be aware of the difficulties normally encountered by enterprises in the development stage. If our business plan is not successful, and we are not able to operate profitably, investors may lose some or all of their investment in our company.

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Due to the speculative nature of the exploration of oil and gas properties, there is substantial risk that our business will fail.

The business of oil and gas exploration and development is highly speculative involving substantial risk. There is generally no way to recover any funds expended on a particular property unless reserves are established and unless we can exploit such reserves in an economic manner. We can provide investors with no assurance that any property interest that we may acquire will provide commercially exploitable reserves. Any expenditure by our company in connection with locating, acquiring and developing an interest in a mineral or oil and gas property may not provide or contain commercial quantities of reserves.

Because of the early stage of development and the nature of our business, our securities are considered highly speculative.

Our securities must be considered highly speculative, generally because of the nature of our business and the early stage of our development. We are engaged in the business of exploring and, if warranted, developing commercial reserves of oil and gas. Our properties are in the exploration stage only and are without known reserves of oil and gas. Accordingly, we have not generated any revenues nor have we realized a profit from our operations to date and there is little likelihood that we will generate any revenues or realize any profits in the short term. Any profitability in the future from our business will be dependent upon locating and developing economic reserves of oil and gas, which itself is subject to numerous risk factors as set forth herein. Since we have not generated any revenues, we will have to raise additional monies through the sale of our equity securities or debt in order to continue our business operations.

The potential profitability of oil and gas ventures depends upon factors beyond the control of our company.

The oil and gas industry in general is cyclical in nature. It tends to reflect and be amplified by general economic conditions, both domestically and abroad. Historically, in periods of recession or periods of minimal economic growth, the operations of oil and gas companies have been adversely affected. Certain end-use markets for oil and petroleum products experience demand cycles that are highly correlated to the general economic environment which is sensitive to a number of factors outside our control.

The current global financial crisis that began in 2008 has had a material adverse effect on our financial results and proposed plan of operations due to a significant reduction in the demand and pricing for oil and gas. A continued recession in 2010 may lead to further significant fluctuations in demand and pricing for oil and gas. If we elect to proceed with the development of any of our property interests, our profitability may be significantly affected by decreased demand. We are not able to predict the timing, extent and duration of the economic cycles in the markets in which we operate.

The potential profitability of oil and gas properties is dependent upon many factors beyond our control. For instance, world prices and markets for oil and gas are unpredictable, highly volatile, potentially subject to governmental fixing, pegging, controls, or any combination of these and other factors, and respond to changes in domestic, international, political, social, and economic environments. Additionally, due to worldwide economic uncertainty, the availability and cost of funds for production and other expenses have become increasingly difficult, if not impossible, to project. These changes and events may materially affect our financial performance.

Adverse weather conditions can also hinder drilling operations. A productive well may become uneconomic in the event water or other deleterious substances are encountered which impair or prevent the production of oil and/or gas from the well. In addition, production from any well may be unmarketable if it is impregnated with water or other deleterious substances. The marketability of oil and gas which may be acquired or discovered will be affected by numerous factors beyond our control. These factors include the proximity and capacity of oil and gas pipelines and processing equipment, market fluctuations of prices, taxes, royalties, land tenure, allowable production and environmental protection. These factors cannot be accurately predicted and the combination of these factors may result in our company not receiving an adequate return on invested capital.

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Competition in the oil and gas industry is very intense and there is no assurance that we will be successful in acquiring additional property interests.

The oil and gas industry is very competitive. We compete with numerous individuals and companies, including many major oil and gas companies, which have substantially greater technical, financial and operational resources and staffs. Accordingly, there is a high degree of competition for desirable oil and gas interests, suitable properties for drilling operations and necessary drilling equipment, as well as for access to funds. We cannot predict if the necessary funds can be raised or that any projected work will be completed.

We are required to obtain licenses and permits from various governmental authorities. We anticipate that we will be able to obtain all necessary licenses and permits to carry on the activities which we intend to conduct, and that we intend to comply in all material respects with the terms of such licenses and permits. However, there can be no guarantee that we will be able to obtain and maintain, at all times, all necessary licenses and permits required to undertake our proposed exploration and development or to place our properties into commercial production. In the event that we proceed with our operation without necessary licenses and permits, we may be subject to large fines and possibly even court orders and injunctions to cease operations.

The acquisition of oil and gas interests involves many risks and disputes as to the title of such interests will result in a material adverse effect on our company.

The acquisition of interests in oil and gas properties involves certain risks. Title to such interests and the borders of such interests may be disputed. Such interests may be subject to prior unregistered agreements or transfers and title may be affected by undetected defects. If it is determined that any of our company's interests are based upon an invalid title, a disputed border, or subject to a prior right, the balance sheet of our company will be adversely affected and we may not be able to recover damages without incurring expensive litigation costs.

The marketability of natural resources will be affected by numerous factors beyond our control which may result in us not receiving an adequate return on invested capital to be profitable or viable.

The marketability of natural resources which may be acquired or discovered by us will be affected by numerous factors beyond our control. These factors include market fluctuations in oil and gas pricing and demand, the proximity and capacity of natural resource markets and processing equipment, governmental regulations, land tenure, land use, regulation concerning the importing and exporting of oil and gas and environmental protection regulations. The exact effect of these factors cannot be accurately predicted, but the combination of these factors may result in us not receiving an adequate return on invested capital to be profitable or viable.

Oil and gas operations are subject to comprehensive regulation which may cause substantial delays or require capital outlays in excess of those anticipated causing an adverse effect on our company.

Oil and gas operations are subject to federal, state, local, and foreign laws relating to the protection of the environment, including laws regulating removal of natural resources from the ground and the discharge of materials into the environment. Oil and gas operations are also subject to federal, state, local, and foreign laws and regulations which seek to maintain health and safety standards by regulating the design and use of drilling methods and equipment. Various permits from government bodies are required for drilling operations to be conducted, and no assurance can be given that such permits will be received. Environmental standards imposed by federal, state, local or foreign authorities may be changed and any such changes may have material adverse effects on our activities. Moreover, compliance with such laws may cause substantial delays or require capital outlays in excess of those anticipated, thus causing an adverse effect on us. Additionally, we may be subject to liability for pollution or other environmental damages which we may elect not to insure against due to prohibitive premium costs and other reasons. To date, we have not been required to spend any material amount on compliance with environmental regulations. However, we may be required to do so in the future and this may affect our ability to expand or maintain our operations.

13

Exploration and production activities are subject to certain environmental regulations which may prevent or delay the commencement or continuance of our operations.

In general, our exploration and production activities are subject to certain federal, state, local, and foreign laws and regulations relating to environmental quality and pollution control. Such laws and regulations increase the costs of these activities and may prevent or delay the commencement or continuance of a given operation. Compliance with these laws and regulations has not had a material effect on our operations or financial condition to date. Specifically, we are subject to legislation regarding emissions into the environment, water discharges and storage and disposition of hazardous wastes. In addition, legislation has been enacted which requires well and facility sites to be abandoned and reclaimed to the satisfaction of governmental authorities. However, such laws and regulations are frequently changed and we are unable to predict the ultimate cost of compliance. Generally, environmental requirements do not appear to affect us any differently or to any greater or lesser extent than other companies in the industry.

We believe that our operations comply, in all material respects, with all applicable environmental regulations. However, we are not fully insured against all possible environmental risks.

Any future operations will involve many risks and we may become liable for pollution or other liabilities which may have an adverse effect on our financial position.

In the course of the exploration, acquisition and development of oil and gas properties, several risks and, in particular, unexpected or unusual geological or operating conditions may occur. Drilling operations generally involve a high degree of risk. Hazards such as unusual or unexpected geological formations, power outages, labor disruptions, blow-outs, sour gas leakage, fire, inability to obtain suitable or adequate machinery, equipment or labor, and other risks are involved. We may become subject to liability for pollution. It is not always possible to fully insure against such risks, and we do not currently have any insurance against such risks nor do we intend to obtain such insurance in the near future due to high costs of insurance. Should such liabilities arise, they could reduce or eliminate any future profitability and result in an increase in costs and a decline in value of the securities of our company.

We are not insured against most environmental risks. Insurance against environmental risks (including potential liability for pollution or other hazards as a result of the disposal of waste products occurring from exploration and production) has not been generally available to companies within the industry. We will periodically evaluate the cost and coverage of such insurance. If we became subject to environmental liabilities and do not have insurance against such liabilities, the payment of such liabilities would reduce or eliminate our available funds and may result in bankruptcy. Should we be unable to fully fund the remedial cost of an environmental problem, we might be required to enter into interim compliance measures pending completion of the required remedy.

Resource exploration involves many risks, regardless of the experience, knowledge and careful evaluation of the property by our company. These hazards include unusual or unexpected formations, formation pressures, fires, power outages, labour disruptions, flooding, explosions and the inability to obtain suitable or adequate machinery, equipment or labour.

Operations in which we will have a direct or indirect interest will be subject to all the hazards and risks normally incidental to the exploration, development and production of oil and gas properties, any of which could result in damage to or destruction of mines and other producing facilities, damage to life and property, environmental damage and possible legal liability for any or all damage. We do not currently maintain liability insurance and may not obtain such insurance in the future. The nature of these risks is such that liabilities could represent a significant cost to our company, and may ultimately force our company to become bankrupt and cease operations.

Any change to government regulation/administrative practices may have a negative impact on our ability to operate and/or our profitability.

The laws, regulations, policies or current administrative practices of any government body, organization or regulatory agency in the United States or any other jurisdiction, may be changed, applied or interpreted in a manner which will fundamentally alter the ability of our company to carry on our business.

14

The actions, policies or regulations, or changes thereto, of any government body or regulatory agency, or other special interest groups, may have a detrimental effect on us. Any or all of these situations may have a negative impact on our ability to operate and/or our profitably.

We may be unable to retain key employees or consultants.

We may be unable to retain key employees or consultants or recruit additional qualified personnel. Our extremely limited personnel means that we would be required to spend significant sums of money to locate and train new employees in the event any of our employees resign or terminate their employment with us for any reason. Due to our limited operating history and financial resources, we are entirely dependent on the continued service of Mr. Rahim Rayani, our chief executive officer. Further, we do not have key man life insurance on Mr. Rayani. We may not have the financial resources to hire a replacement if Mr. Rayani were to die. The loss of service of Mr. Rayani could therefore significantly and adversely affect our operations.

Our stock is a penny stock. Trading of our stock may be restricted by the Securities and Exchange Commission's penny stock regulations which may limit a stockholder's ability to buy and sell our stock.

Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines “penny stock” to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and “accredited investors”. The term “accredited investor” refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Securities and Exchange Commission which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

Financial Industry Regulatory Authority, or FINRA, has adopted sales practice requirements which may also limit a stockholder's ability to buy and sell our stock.

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not Applicable.

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Item 4T. Controls and Procedures.

Disclosure Controls and Procedures

As required by Rule 13a-15 of the Securities Exchange Act of 1934, our principal executive officer and principal financial officer evaluated our company's disclosure controls and procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of the end of the period covered by this report, these disclosure controls and procedures were not effective to ensure that the information required to be disclosed by our company in reports it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities Exchange Commission and to ensure that such information is accumulated and communicated to our company's management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. The conclusion that our disclosure controls and procedures were not effective was due to the presence of the following material weaknesses in internal control over financial reporting which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both United States generally accepted accounting principles and Securities and Exchange Commission guidelines. Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated.

We plan to take steps to enhance and improve the design of our internal controls over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes during our fiscal year ending November 30, 2010, subject to obtaining additional financing: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out above are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended February 28, 2010 that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We know of no material, active 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.

Not Applicable.

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

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. (REMOVED AND RESERVED).

None.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS

Exhibit	Description
Number
3.1	Articles of Incorporation (incorporated by reference from our Registration Statement on Form SB-2 filed on March 16, 2007).
3.2	Bylaws (incorporated by reference from our Registration Statement on Form SB-2 filed on March 16, 2007).
3.3	Certificate of Change filed with the Secretary of State of Nevada on December 28, 2006 (incorporated by reference from our Current Report on Form 8-K filed on January 4, 2007).
3.4	Articles of Merger filed with the Secretary of State of Nevada on January 4, 2007 (incorporated by reference from our Quarterly Report on Form 10-QSB filed on April 17, 2008).
3.5	Articles of Merger filed with the Secretary of State of February 12, 2008 (incorporated by reference from our Quarterly Report on Form 10-QSB filed on April 17, 2008).
10.1	Participation Agreement dated November 30, 2007 between County Line Energy Corp. and Nuance Exploration Ltd. (incorporated by reference from our Current Report on Form 8-K filed on December 19, 2007).
10.2	Letter Agreement dated March 11, 2008 with G2 Petroleum, LLC (incorporated by reference from our Current Report on Form 8-K filed on April 4, 2008).

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Exhibit	Description
Number
10.3	Promissory Note to G2 Petroleum, LLC (incorporated by reference from our Current Report on Form 8-K filed on April 4, 2008).
10.4	Letter of Intent to Farm out dated April 17, 2008 between our company and Desert Mining Inc. (incorporated by reference from our Current Report on Form 8-K filed on April 23, 2008).
10.5	Advisory and Business Consulting Services Agreement dated April 16, 2008 with Robert B. Perry (incorporated by reference from our Current Report on Form 8-K filed on May 1, 2008).
10.6	Advisory and Business Consulting Services Agreement dated April 16, 2008 with Leon Hinton (incorporated by reference from our Current Report on Form 8-K filed on May 1, 2008).
10.7	Advisory and Business Consulting Services Agreement dated April 16, 2008 with Bourgeois Energy, Inc. (incorporated by reference from our Current Report on Form 8-K filed on May 1, 2008).
10.8	Loan Agreement between Force Energy Corp. and G2 Petroleum, LLC dated March 11, 2009 (incorporated by reference from our Annual Report on Form 10-K filed on March 17, 2009)
10.9	Lease Agreement between Force Energy Corp. and TEG Inc. dated September 11, 2008 (incorporated by reference from our Annual Report on Form 10-K filed on March 17, 2009)
10.10	Assignment Agreement between Force Energy Corp. and G2 Petroleum, LLC dated effective June 20, 2009 (incorporated by reference from our Quarterly Report on Form 10-Q filed on July 15, 2009)
10.11	Assignment Agreement between Force Energy Corp. and G2 Petroleum, LLC dated effective September 16, 2009 (incorporated by reference from our Current Report on Form 8-K filed on September 24, 2009)
10.12	Addendum to Participation Agreement between Force Energy Corp. and County Line Energy Corp. dated October 16, 2009 (incorporated by reference from our Quarterly Report on Form 10-Q filed on October 23, 2009)
10.13	Share Issuance Agreement between Force Energy Corp. and Villa Atmu S.A. dated November 16, 2009 (incorporated by reference from our Current Report on Form 8-K filed on November 24, 2009)
10.14	Form of Subscription Agreement dated October 30, 2009 (incorporated by reference from our Annual Report on Form 10-K filed on March 15, 2010)
10.15	Amendment No. 1 to Addendum to Participation Agreement between County Line Energy Corp. and Force Energy Corp. dated February 1, 2010 (incorporated by reference from our Annual Report on Form 10-K filed on March 15, 2010)
31.1*	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of theSarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of theSarbanes-Oxley Act of 2002.
99.1	Code of Ethics (incorporated by reference from our Annual Report on Form 10-K filed on March 15, 2010)

* Filed herewith.

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SIGNATURES

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

FORCE ENERGY CORP.

By/s/ Rahim Rayani                                                                 
Rahim Rayani
President, Chief Executive Officer, Chief Financial Officer,
Secretary and Director
(Principal Executive Officer, Principal Accounting Officer
and Principal Financial Officer)
Date: April 13, 2010