TAMM Oil & Gas (TAMO) 10-Q 2009 Q3 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

 (Mark One)

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

the quarterly period ended December 31, 2008 

OR

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _____________to _____________

Commission file number 333-137174

TAMM OIL AND GAS CORP.

(Exact name of small business issuer as specified in its charter)

Nevada	20-3773508
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Suite 405, 505 8thAve  SW, Calgary, AB, Canada T2P 1G2

(Address of principal executive offices)

403-975-9399

(Issuer’s telephone number)

____________________________________________________________________

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

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

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

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

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

Yes ¨    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 62,780,000 shares outstanding as of February 10, 2009.

TAMM OIL AND GAS CORP.

TABLE OF CONTENTS

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets as of December 31, 2008 (unaudited) and March 31, 2008	3
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended December 31, 2008 and 2007 and from October 10, 2005 (date of inception) through December 31, 2008 (unaudited)	4
	Condensed Consolidated Statements of Stockholders’ Equity  from October 10, 2005 (date of inception) through December 31, 2008 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2008 and 2007 and from October 10, 2005 (date of inception) through December 31, 2008 (unaudited)	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2	Management's Discussion and Analysis or Plan of Operation	13
Item 3	Quantitative and Qualitative Disclosures About Market Risk	19
Item 4	Controls and Procedures	19
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	20
Item 1A	Risk Factors	20
Item 2	Recent Sales of Unregistered Securities and Use of Proceeds	23
Item 3	Defaults Upon Senior Securities	23
Item 4	Submission of Matters to a Vote of Security Holders	23
Item 5	Other Information	24
Item 6.	Exhibits	24
Signatures		24

2

PART I - FINANCIAL INFORMATION

 Item 1. Financial Statements

TAMM OIL AND GAS CORP.
(An Exploration Stage Company)
CONDENSED BALANCE SHEETS
	December 31,			March 31,
	2008			2008
	(unaudited)
ASSETS
Current assets:
Cash	$	1,112		$	169,844
Accounts receivable		11,349			14,921
Prepaid expenses		49,985			-
Total current assets		62,446			184,765
Property, plant and equipment:
Oil sands properties, unevaluated		5,105,724			4,718,903
Furniture and equipment, net		418			3,223
Total property, plant and equipment		5,106,142			4,722,126
Other assets:
Deposits		60,755			-
Receivable from affiliated entity		576,252			576,252
Total other assets		637,007			576,252
Total assets	$	5,805,595		$	5,483,143
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	629,743		$	24,652
Advances from related party		80,395			-
Notes payable, affiliate		750,000			-
Total current liabilities		1,460,138			24,652
Commitments and contingencies
Stockholders' equity:
Preferred stock; $0.001 par value; 1,000,000 shares authorized, none issued and outstanding		-			-
Common stock; $0.001 par value; 750,000,000 shares authorized, 62,780,000 and 118,313,000 shares issued and outstanding as of December 31, 2008 and March 31, 2008		62,780			118,313
Additional paid in capital		66,204,380			66,148,847
(Deficit) accumulated during exploration stage		(61,919,312	)		(60,808,669	)
Accumulated other comprehensive income (loss)		(2,391	)		-
Total stockholders' equity		4,345,457			5,458,491
Total liabilities and stockholders' equity	$	5,805,595		$	5,483,143

The accompanying notes are an integral part of these financial statements

3

TAMM OIL AND GAS CORP.
(An Exploration Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
													For the period
													October 10, 2005
													(date of inception)
	Three months ended December 31,						Nine months ended December 31,						through
	2008			2007			2008			2007			December 31, 2008
REVENUE	$	-		$	-		$	-		$	-		$	-
OPERATING EXPENSES:
Selling, general and administrative		258,798			75,519			1,061,962			119,550			1,380,098
Depreciation		18			-			772			-			772
Total operating expenses		258,816			75,519			1,062,734			119,550			1,380,870
(Loss) from operations		(258,816	)		(75,519	)		(1,062,734	)		(119,550	)		(1,380,870	)
OTHER INCOME (EXPENSE)
Foreign exchange (loss) gain		-			-			(8,543	)		-			(116	)
Interest income (expense)		(14,407	)		-			(35,626	)		-			(35,626	)
(Loss) on impairment of fixed assets		(2,032	)		(10,000	)		(2,031	)		(35,000	)		(37,031	)
(Loss) on impairment of investments		-			(60,463,160	)		-			(60,463,160	)		(60,463,160	)
(Loss) before provision for income taxes		(275,255	)		(60,548,679	)		(1,108,934	)		(60,617,710	)		(61,916,803	)
Provision for income taxes:
Current		1,431			-			1,709			-			2,509
Deferred		-			-			-			-			-
Total income taxes		1,431			-			1,709			-			2,509
NET (LOSS)		(276,686	)		(60,548,679	)		(1,110,643	)		(60,617,710	)		(61,919,312	)
Foreign currency translation gain (loss)		(2,033	)		-			(2,391	)		-			(2,391	)
Comprehensive (loss)	$	(278,719	)	$	(60,548,679	)	$	(1,113,034	)	$	(60,617,710	)	$	(61,921,703	)
Net (loss) per common share (basic and diluted)	$	(0.00	)	$	(0.64	)	$	(0.01	)	$	(0.66	)
Weighted average number of common shares outstanding, basic and diluted		62,780,000			94,336,217			90,804,036			91,728,844

The accompanying notes are an integral part of these financial statements

4

TAMM OIL AND GAS CORP.
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
For the period October 10, 2005 (date of Inception) through December 31, 2008
(unaudited)
										Other			(Deficit) Accumulated
	Common stock						Additional			Comprehensive			During Exploration
	Shares			Amount			Paid in Capital			Income (loss)			Stage			Total
Balance, October 10, 2005		-		$	-		$	-		$	-		$	-		$	-
Sale of common stock in October 2005 to founders at $0.0001 per share		60,000,000			60,000			(56,000	)		-			-			4,000
Sale of common stock in March 2006 at $0.003 per share		30,000,000			30,000			70,000			-			-			100,000
Net (loss)		-			-			-			-			(2,134	)		(2,134	)
Balance, March 31, 2006		90,000,000			90,000			14,000			-			(2,134	)		101,866
Net (loss)		-			-			-			-			(69,346	)		(69,346	)
Balance, March 31, 2007		90,000,000			90,000			14,000			-			(71,480	)		32,520
Sale of common stock in August 2007 at $0.07 per share		1,500,000			1,500			98,500			-			-			100,000
Sale of common stock at various dates during the year at $1.25  per share		1,280,000			1,280			1,598,720			-			-			1,600,000
Common stock issued in exchange for investment		21,533,000			21,533			54,241,627			-			-			54,263,160
Common stock issued in exchange for royalty agreement		4,000,000			4,000			10,196,000			-			-			10,200,000
Net (loss)		-			-			-			-			(60,737,189	)		(60,737,189	)
Balance, March 31, 2008		118,313,000			118,313			66,148,847			-			(60,808,669	)		5,458,491
Cancellation of common stock previously issued as investment		(21,533,000	)		(21,533	)		21,533			-			-			-
Cancellation of common stock previously issued to founders		(34,000,000	)		(34,000	)		34,000			-			-			-
Foreign currency translation gain (loss)		-			-			-			(2,391	)		-			(2,391	)
Net (loss)		-			-			-			-			(1,110,643	)		(1,110,484	)
Balance, December 31, 2008		62,780,000		$	62,780		$	66,204,380		$	(2,391	)	$	(61,919,312	)	$	4,345,457

The accompanying notes are an integral part of these financial statements

5

TAMM OIL AND GAS CORP.
(An Exploration Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
							For the period
							October 31, 2005
	Nine months ended December 31,						(Inception of Inception)
	2008			2007			through December 31, 2008
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)	$	(1,110,643	)	$	(60,617,710	)	$	(61,919,312	)
Adjustments to reconcile net (loss) to net cash (used in) operating activities:
Depreciation		772			-			772
Impairment of property and equipment		2,031			35,000			37,031
Impairment of investments in stock and royalty agreements		-			60,463,160			60,463,160
(Increase) in receivables		-			(532,211	)		-
(Increase) decrease in accounts receivable		3,572			(2,826	)		(11,349	)
(Increase) in prepaid expenses		(49,985	)		-			(49,985	)
Increase in accounts payable		605,093			2,581			619,745
Net cash (used in) operating activities		(549,160	)		(652,006	)		(859,938	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of oil and gas properties		(386,821	)		-			(1,105,724	)
Deposits paid on investments		(60,755	)		-			(60,755	)
Purchase of investment		-			-			(576,252	)
Purchases of property and equipment		-			-			(38,223	)
Net cash (used in) investing activities		(447,576	)		-			(1,780,954	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock		-			1,600,000			1,804,000
Proceeds from notes payable, affiliate and advances from related party		1,330,395			10,000			1,340,395
Repayments of notes payable, affiliate		(500,000	)		-			(500,000	)
Net cash provided by financing activities		830,395			1,610,000			2,644,395
Effect of currency rate change on cash		(2,391	)		-			(2,391	)
Net increase (decrease ) in cash and cash equivalents		(168,732	)		957,994			1,112
Cash and cash equivalents at beginning of period		169,844			3,866			-
Cash and cash equivalents at end of period	$	1,112		$	961,860		$	1,112
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for interest	$	-		$	-		$	-
Cash paid during the period for taxes	$	1,709		$	-		$	2,509
NON CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock for royalty agreements	$	-		$	-		$	10,200,000
Issuance of common stock in exchange for common stock of an unaffiliated entity	$	-		$	-		$	54,263,160

The accompanying notes are an integral part of these financial statements

6

TAMM OIL AND GAS CORP.

(An Exploration Stage Company)

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

DECEMBER 31, 2008

Tamm Oil and Gas Corp. is referred to in these notes as “the Company” or “TAMM”.

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting policies applied in the presentation of the accompanying unaudited condensed financial statements follows:

General

The interim condensed financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) as promulgated in Item 210 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted pursuant to such SEC rules and regulations.

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  The results from operations for the nine month period ended December 31, 2008, are not necessarily indicative of the results that may be expected for the year ended March 31, 2009.  The unaudited condensed financial statements should be read in conjunction with the dated March 31, 2008, financial statements and footnotes thereto included in the Company’s Form 10-KSB filed with the SEC on July 14, 2008.

Basis and business presentation

TAMM, formerly Hola Communications, Inc., was incorporated under the laws of the State of Nevada on October 10, 2005. The Company was formed to provide wireless broadband access. In October 2007, the Company decided to discontinue its efforts to develop its original business plan in the telecom industry and to re-direct its focus to the oil and gas Industry. In November 2007, the Company created a wholly owned Nevada subsidiary for the purpose of affecting a name change from Hola Communications, Inc. to TAMM Oil and Gas Corporation. To implement its current business plan, significant additional financing will be required and the Company will need to be successful in its efforts to identify, acquire and develop oil and gas reserves that are economically recoverable.

The Company is in the development stage as defined by Statement of Financial Accounting Standards No. 7 (“SFAS No. 7”) with its efforts principally devoted to developing oil and gas reserves. To date, the Company, has not generated sales revenues, has incurred expenses and has sustained losses.  Consequently, its operations are subject to all the risks inherent in the establishment of a new business enterprise.  For the period from inception through December 31, 2008, the Company has accumulated losses of $61,919,312.

Estimates

The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

7

TAMM OIL AND GAS CORP.

(An Exploration Stage Company)

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

DECEMBER 31, 2008

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (continued)

Fair Values

Effective for the nine month period ended December 31, 2008, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 157, “Fair Value Measurements” (SFAS No. 157) as amended by FASB Statement of Position (FSP) FAS 157-1 and FSP FAS 157-2. SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and enhances fair value measurement disclosure. FSP FAS 157-2 delays, until the first quarter of fiscal year 2009, the effective date for SFAS 157 for all non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). The adoption of SFAS No. 157 did not have a material impact on the Company’s financial position or operations.

Comprehensive Income (Loss)

The Company adopted Statement of Financial Accounting Standards No. 130; “Reporting Comprehensive Income” (SFAS) No. 130 establishes standards for the reporting and displaying of comprehensive income and its components. Comprehensive income is defined as the change in equity of a business during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. SFAS No. 130 requires other comprehensive income (loss) to include foreign currency translation adjustments and unrealized gains and losses on available for sale securities.

Net income (loss) per share

The Company computes earnings per share under Statement of Financial Accounting Standards No. 128, "Earnings Per Share" (“SFAS 128”). Net earnings (losses) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and dilutive common stock equivalents outstanding during the period. Dilutive common stock equivalents consist of shares issuable upon conversion of convertible preferred shares and the exercise of the Company's stock options and warrants (calculated using the treasury stock method). During the three and nine month periods ended December 31, 2008 and 2007, common stock equivalents are not considered in the calculation of the weighted average number of common shares outstanding because they would be anti-dilutive, thereby decreasing the net loss per common share.

Reclassifications

Certain amounts reported in the Company's financial statements for the prior periods may have been reclassified to conform to the current period presentation.

8

TAMM OIL AND GAS CORP.

(An Exploration Stage Company)

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

DECEMBER 31, 2008

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements
 

Recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed by management to, have a material impact on the Company’s present or future financial statements.

NOTE 2 – GOING CONCERN MATTERS

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying financial statements for the nine month and inception to date periods ended December 31, 2008, the Company has incurred losses of $1,110,643 and $61,919,312, respectively.  In addition, as of December 31, 2008, the Company had a working capital deficit of $1,397,692, and no revenue generating operations. These factors, among others, indicate that the Company may be unable to continue as a going concern.

The Company's existence is dependent upon management's ability to develop profitable operations and resolve its liquidity problems. The accompanying financial statements do not include any adjustments that may result should the Company be unable to continue as a going concern.

The Company is attempting to obtain financing for its operations. There can be no assurance that the Company will be successful in its effort to secure additional equity financing. If operations and cash flows continue to improve through these efforts, management believes that the Company can continue to operate. However, no assurance can be given that management's actions will result in profitable operations or the resolution of its liquidity problems.

NOTE 3 – NOTES PAYABLE TO AFFILIATED ENTITY

During the nine month period ended December 31, 2008, the Company issued $1,250,000 of demand notes payable with an interest rate of prime plus 2% per annum. The Company repaid $500,000 of the demand notes during the nine month period ended December 31, 2008. As of December 31, 2008, outstanding notes payable on the demand notes totaled $750,000.

The noteholder is a shareholder of 1132559 Alberta, Ltd., an affiliated entity as Alberta and TAMM have officers and/or directors in common.

During the nine months ended December 31, 2008, the Company received advances from a related party of $80,395, used to pay operating expenses.

9

TAMM OIL AND GAS CORP.

(An Exploration Stage Company)

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

DECEMBER 31, 2008

NOTE 4 – CAPITAL STOCK

Preferred stock

The Company has authorized the issuance of 1,000,000 shares of preferred stock, par value $.001 per share. The Company’s Board of Directors has broad discretion to create one or more series of preferred stock and determine the rights, preferences, and privileges of any such series.

Common stock

The Company initially authorized the issuance of 50,000,000 shares of common stock, par value $.001. On November 13, 2007, the Company declared a 15:1 forward split, and concurrently increased its authorized shares to 750,000,000 shares of common stock, par value $.001 per share. All share amounts have been restated as if the split had occurred October 10, 2005.

As of December 31, 2008 and March 31, 2008, there were 62,780,000 and 118,313,000 shares of common stock issued and outstanding respectively.

In July 2008, 34,000,000 shares of the Company’s common stock previously issued to founders in October 2005 were returned for cancellation.

In September 2008, 21,533,000 shares of the Company’s common stock previously issued in exchange for common shares of Deep Well Oil & Gas, Inc were returned to the Company and cancelled. (See Note 6 below).

NOTE 5 – OPTIONS AND WARRANTS

Stock warrant activities from March 31, 2008 through December 31, 2008 are as follows:

	Stock Warrants
		Weighted
		Exercise
	Shares	Price
Outstanding at March 31, 2008	1,280,000	$	1.75
Granted	—		—
Canceled	—		—
Expired	—		—
Exercised	—		—
Outstanding at December 31, 2008	1,280,000	$	1.75

10

TAMM OIL AND GAS CORP.

(An Exploration Stage Company)

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

DECEMBER 31, 2008

NOTE 5 – OPTIONS AND WARRANTS (continued)

Warrants outstanding and exercisable at December 31, 2008, are as follows:

Outstanding and Exercisable Warrants
			Weighted	Weighted
Exercise			Average	Average
Price			Contractual	Exercise
Range		Number	Life	Price
$	1.75	1,280,000	0.94	$	1.75

Options

As of December 31, 2008, the Company has no outstanding options.

NOTE 6 - CONTINGENCIES

The Company is a defendant in pending litigation by Deep Well Oil & Gas, Inc. (“Deep Well”) in the United States District Court of Nevada. The litigation involves an alleged breach by the Company of federal securities law requirements for an alleged tender offer to Deep Well’s shareholders, in addition to claims for fraud and defamation relating to certain press releases and securities law filings of the Company. The complaint seeks injunctive relief and unspecified damages. The Company's position in this litigation is that the subject transactions were private stock exchange agreements between the Company and certain Deep Well shareholders and did not constitute a tender offer. The Company denies the other allegations in the Complaint as well. The Company filed its opposition to a motion for preliminary injunction and a motion to dismiss, and Deep Well failed to dismiss the suit. The Company filed a motion for partial summary judgment, to which Deep Well opposed and also filed its First Amended Complaint, which adds a claim for conspiracy against the Company, and other parties. The Company moved to dismiss the Complaints. Briefing is scheduled to be completed by March 10, 2009 and the matter will be submitted to the court for hearing and decision.

As previously reported, as of July 1, 2008, we entered into a termination and rescission agreement with each of such Deep Well shareholders (collectively the “Termination and Rescission Agreements”) pursuant to which we and the Deep Well shareholders agreed to rescind the transactions consummated under the stock exchange agreements with the same effect as if the agreements had never been executed and delivered and such transactions had never been consummated. The rescission was undertaken voluntarily by the Company and is neither an admission of any wrongdoing by the Company nor a waiver of any rights or remedies which the Company may have against any person (except for such Deep Well shareholders pursuant to the terms of the Termination and Rescission Agreements).

All of the 21,533,000 shares the Company issued pursuant to the stock exchange agreements have now been returned to the Company, and all of the certificates representing the shares have been cancelled.

11

TAMM OIL AND GAS CORP.

(An Exploration Stage Company)

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

DECEMBER 31, 2008

NOTE 6 – CONTINGENCIES (continued)

Material Definitive Agreement with Selling Stockholders of 1132559 Alberta Ltd.

On September 5, 2008, the Company entered into a Material Definitive Agreement with the Selling Stockholders of 1132559 Alberta Ltd , which provides that the Selling Stockholders agree to transfer to us all of the issued and outstanding shares held by them subject to the following, amongst other conditions, being met:

(i)	Issue 15,000,000 shares of our common stock to the Selling Stockholders; a portion of these shares have been issued In Trust, pending completion of all conditions
(ii)	TAMM total debt to be a maximum of $3,750,000.
(iii)	the satisfactory completion of the parties due diligence investigations
(iv)	1132559 Alberta Ltd. preparing financial statements required under applicable securities laws

Currently, both TAMM and 1132559Alberta Ltd. are reviewing the arrangement of the Agreement, taking into consideration the change in the global economic situation and decrease in current oil prices. The companies agree in principle that progression forward should be beneficial to both parties. 1132559 Alberta Ltd. is a private company incorporated under the laws of Alberta and holds a direct working interest of 10% in 63 sections of oil sands leases in the Sawn Lake area in Northern Alberta.

NOTE 7 – OIL SANDS PROPERTIES

Peace River Purchase

On May 28, 2008, the Company purchased 14 sections of petroleum and natural gas (“P&NG”) leases in the Peace River region of northern Alberta for $374,883 that are adjacent to the existing 21 sections of oil sands leases. With this latest acquisition, the Company now has a 100% working interest in 35 sections, or approximately 22,400 acres. An independent engineering report was commissioned on the newly acquired adjacent 14 sections of leases, and for the determination of heavy oil in place for the entire 35 sections.

The Company provided deposits in an aggregate of $60,755 towards drilling costs relating to the Material Definitive Agreement with selling stockholders of 1132559 Alberta Ltd. during the nine month period ended December 31, 2008.

12

Item 2. Management’s Discussion and Analysis or Plan of Operation.

TAMM Oil and Gas Corp. is referred to hereinafter as “we”, “our”, or “us”.

FORWARD-LOOKING STATEMENTS

This Form 10-Q report for the quarterly period ended December 31, 2008 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. 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, including the following: (a) we have a history of losses and no revenue to date; if this trend continues, it may negatively affect our ability to implement our Plan of Operations; (b) because we are an exploration company with little operating history, it will be difficult for you to assess our future prospects; (c) should we fail to successfully identify, acquire and develop oil and gas properties on an economically recoverable basis, our results of operations will be negatively effected; (d) our business is dependent upon our management team; should we lose any of their services, we may not find suitable and capable replacements and our operations may be negatively effected; (e) our operational plan will require substantial expenses l requiring financing; should we be unable to obtain the required financing our operational plan will be negatively effected; (f) we anticipate issuing additional shares for financing needs as well as payment to consultants and others providing services to us; these issuances will dilute the value of your investment; (g) we are subject to substantial costs for environmental and other compliance and possible future regulatory changes, costs of which may adversely affect our ability to implement components of our business plan and will negatively effect our results of operations, and possible delays in our operations; (h) we face significant competition from oil and natural gas companies and other individual producers and operators that have longer operating histories, greater financial and technological resources, and access to capital, than we do; and (i) because the majority of our assets our located in Alberta, Canada and our officers and directors are located outside the United States, investors may encounter difficulties in enforcing legal actions against us or our officers or directors.

This list is not an exhaustive list of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on our forward-looking statements.

Forward looking statements are made based on management’s beliefs, estimates and opinions on the date the statements are made and we undertake no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change. 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, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

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

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PLAN OF OPERATION

Overview

We are a petroleum exploration company that seeks to identify, acquire and develop working interests in Canada based oil sands prospects. Oil sand properties are characterized by deposits of bitumen, a form of viscous (relatively high resistance to flow) crude oil.

Our Plan of Operations to Date

 To date, we have accomplished the following in our Plan of Operations:

Oil Sands and Petroleum &Natural Gas Interests

We have the following interests:

Peace River – Oil Sands Leases

On January 9, 2008, we acquired a 100% interest in 21 sections of oil sands leases in the Peace River Oil Sands Area at an Alberta Crown Land Sale for $718,903.

Peace River – Petroleum & Natural Gas Leases

On May 28, 2008, we acquired a 100% interest in 14 sections of the petroleum and natural gas (“P&NG”) leases in the Peace River region at an Alberta Crown Land Sale for $374,883.

Sawn Lake Oil Sands - Letter Agreement

We entered into a November 26, 2007 letter agreement with Vendors, 1004731 Alberta Ltd. and Muzz Investments Inc., whereby the Vendors agreed to sell, assign and transfer to us, their entire right, title and interest in a December 12, 2003 royalty agreement made between Mikwec Energy Canada Ltd. and Nearshore Petroleum Corporation in exchange for our issuance of 4,000,000 shares of our common stock.

Material Definitive Agreement with Selling Stockholders of 1132559 Alberta Ltd.

On September 5, 2008 we have entered into a Material Definitive Agreement with the Selling Stockholders of 1132559 Alberta Ltd , which provides that the Selling Stockholders agree to transfer to us all of the issued and outstanding shares held by them subject to the following, among other conditions, being met:

(i)	Issue 15,000,000 shares of our common stock to the Selling Stockholders; a portion of these shares have been issued In Trust, pending completion of all conditions
(ii)	TAMM total debt to be a maximum of $3,750,000.
(iii)	the satisfactory completion of the parties due diligence investigations
(iv)	1132559 Alberta Ltd. preparing financial statements required under applicable securities laws

 Currently, both TAMM and 113 Alberta Ltd. are reviewing the arrangement of the Agreement, taking into consideration the change in the global economic situation and decrease in current oil prices. The companies agree in principle that progression forward should be beneficial to both parties. 1132559 Alberta Ltd. is a private company incorporated under the laws of Alberta and holds a direct working interest of 10% in 63 sections of oil sands leases in the Sawn Lake area in Northern Alberta.

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Our Plan of Operations Going Forward

Our primary operational focus is the Peace River/Manning project. On May 28, 2008, we purchased 14 sections of the P&NG leases at an Alberta Crown land sale that are adjacent to our existing 21 sections of oil sands leases in the Peace River region of Northern Alberta. With this latest acquisition, we now have a 100% working interest in 35 sections in the Peace River region, or approximately 22,400 acres. An independent engineering report was completed in 2008 on the newly acquired adjacent 14 sections of leases for the determination of heavy oil in place for the 35 sections.

We intend to further expand our interests in oil sands properties through Alberta Crown Land Sales and/or purchasing interests from other companies that currently hold interests in oil sands properties. To assess our prospects and out acquisitions, we will contractually engage geologists and geophysicists to provide geological evaluations. Presently, our costs are uncertain because they are contingent upon the results of our information and data/collection to confirm whether we have a viable prospect, which will be determined by: (a) our contracted geologists and geophysicists that provide geological evaluations; (b) geological data results and related information/data that we obtain through: (i) the public domain; (ii) our acquisition of data from private firms; and (c) field activities, such as seismic surveys, that we may conduct to gather specific information, for the purpose of modeling the underlying geological structure.

We will continually adjust our Plan of Operations based on this comprehensive analysis, the extent and quality of the available data, and other factors, such as applying risk assessment and cost analyses, to determine which of the following activities we will engage in:

· Geological Studies

Geological study of underground layers of rock in search for structural or stratigraphic traps that are favorable for the accumulation of hydrocarbons and ultimately determine locations for drilling.

· Geophysical Surveys

The accurate measurement and recording of certain physical quantities of underground layers of rock; geophysical methods, such as seismic, to locate probable reservoir structures capable of producing commercial quantities of natural gas and/or crude oil.

· Seismic Surveys

Surveys to gather and record the patterns of induced shock wave reflections from underground layers of rock. Seismic surveys are used to create detailed models of the underlying geological structure used in the exploration and development of hydrocarbons.

· Core Drilling Programs

A drilling operation to obtain continuous cylinders of rock, usually from two to four inches in diameter, cut from the bottom of a well-bore; cores are cut during the drilling of a well and are used in the study of underground formations.

· Exploratory Well Drilling

A well drilled either in search of new and yet undiscovered accumulations of oil and gas, or in an attempt to significantly extend the limits of a known reservoir.

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Results of Operations

Three month period ended December 31, 2008 Summary

	Three month period ended
	December 31,
	2008				2007
Revenue		$	-			$	-
Operating Expenses			(258,816	)			(75,519	)
Impairment (loss) on investment			-				(60,463,160	)
Interest expense and other			(16,439	)			(10,000	)
Income Taxes			(1,431	)			-
Net (Loss)		$	(276,686	)		$	(60,548,679	)

Nine month period ended December 31, 2008 Summary

	Nine month period ended
	December 31,
	2008				2007
Revenue		$	-			$	-
Operating Expenses			(1,062,734	)			(119,550	)
Foreign exchange (loss)			(8,543	)			-
Impairment (loss) on investment			-				(60,463,160	)
Interest expense and other			(37,657	)			(35,000	)
Income Taxes			(1,709	)			-
Net (Loss)		$	(1,110,643	)		$	(60,617,710	)

Revenue

We are currently a development stage company conducting exploration activities and we have not earned any revenues since our inception. We do not anticipate earning revenues until such time as we have entered into commercial production of our oil and gas projects, if ever. Even if we discover such commercially exploitable resources, we will have to determine whether the project is economically feasible.

Capital Expenditures and Requirements

At the present time, we have no capital commitments or expenditures, although we anticipate that we will have both expenditures at certain stages of our operational plan.

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Three month period ended December 31, 2008

Expenses

Our operating expenses for the three month period ended December 31, 2008 increased by $183,297 or 243% to $258,816 from $75,519 for the comparable 2007 three-month period. This increase is primarily a result of increased professional and consulting fees for the current period. The fees increased primarily due to legal expenses of approximately $201,495, primarily for the litigation with Deep Well but include SEC Counsel and other corporate matters, geological and engineering consulting fees, and consulting fees paid to the officers and/or directors in lieu of salaries.

Net Loss

Our net loss for the three month period ended December 31, 2008 decreased by $60,271,993 or 99% to $276,686 from $60,548,679 for the comparable 2007 period. This decrease is primarily a result of an impairment charge we incurred on our investments in 2007.

Nine month period ended December 31, 2008:

Expenses

Our operating expenses for the nine month period ended December 31, 2008 increased by $943,184 or 789% to $1,062,734 from $119,550 for the comparable 2007 nine-month period. This increase is primarily a result of increased professional and consulting fees for the current period. The fees increased primarily due to legal expenses of approximately $682,050, primarily for the litigation with Deep Well but include SEC Counsel and other corporate matters, geological and engineering consulting fees, and consulting fees paid to the officers and/or directors in lieu of salaries.

Net Loss

Our net loss for the nine month period ended December 31, 2008 decreased by $59,507,067 or 98% to $1,110,643 from $60,617,710 for the comparable 2007 period. This decrease is primarily a result of an impairment charge we incurred on our investments in 2007, net of increased professional and consulting fees for the current period.

Trends and Uncertainties

We are subject to the following trends and uncertainties:

· Adverse weather conditions that will effect our ability to conduct our exploration activities;

· General economic conditions, including supply and demand for petroleum based products in Canada, the United States, and remaining parts of the world;

· Political instability in the Middle East and other major oil and gas producing regions;

· Domestic and foreign tax policy;

· Price of oil and gas foreign imports;

· Cost of exploring for, producing, and delivering oil and gas;

· Overall supply and demand for oil and gas;

· Availability of alternative fuel sources;

· Discovery rate of new oil and gas reserves; and

· Pace adopted by foreign governments for the exploration, development and production of their national reserves.

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Liquidity and Capital Resources

Current Assets, Current Liabilities, and Working Capital

Our working capital deficit increased by 973% for the nine month period ended December 31, 2008. The details are as follows:

	As of  December 31, 2008			As of March 31, 2008		Percentage Increase (decrease)
Current Assets	$	62,446		$	184,765		(66	)%
Current Liabilities	$	1,460,138		$	24,652		5,823	%
Working Capital (Deficit)	$	(1,397,692	)	$	160,113		(973	)%

Our working capital deficit increased primarily because: (a) we entered into a loan agreement in the amount of $1,250,000, net of $500,000 repayments; and (b) increased accounts payable, primarily due to legal fees.

Cash Flows

During the nine month period ended December 31, 2008, we utilized $549,160 in operating cash principally in payments for professional and consulting fees. Additionally we acquired additional mining properties for $386,821 and placed a deposit on an investment of $60,755. We met our cash flow needs from notes payable from an affiliated entity, along with advances from related party, net of repayments, of $830,395.

	Nine Months Ended			Nine Months Ended
	December 31, 2008			December 31, 2007
Cash Flows (used in) Operating Activities	$	(549,160	)	$	(652,006	)
Cash Flows (used in) Investing Activities	$	(447,576	)	$	0
Cash Flows provided by Financing Activities	$	830,395		$	1,610,000
Effect of currency rate change on cash	$	(2,391	)	$	0
Net Increase (Decrease) in Cash During Period	$	(168,732	)	$	957,994

We will require additional financing to proceed with our Plan of Operations over the next twelve months. Our cash requirements are in excess of our current cash and working capital resources. Accordingly, we will require additional financing in order to continue operations. There is no assurance that any party will advance additional funds to us or we will be able to raise sufficient funds from an equity financing to enable us to sustain our Plan of Operations.

Future Financings

We will have to secure additional financing in the next 12 months in order to complete our Plan of Operations, which we may be unable to secure. We presently do not have any arrangements for additional financing and we have no potential lines of credit or sources of financing are currently available for the purpose of proceeding with our plan of operations. We will likely rely on equity sales of our common stock to fund our operations, resulting in dilution to our existing stockholders.

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Off-Balance Sheet Arrangements

We have no significant 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.

Critical Accounting Policies

The preparation of financial statements in conformity with generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Going Concern

During the period October 10, 2005 (inception) to December 31, 2008, we generated no revenue and we had an accumulated deficit of $61,919,312. We will need significant financing to implement our business plan. Our financial statements have been prepared assuming that we will continue as a going concern.

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from our possible inability to continue as a going concern.

Item 3. - Quantitative and Qualitative Disclosures About Market Risk.

The Company is a smaller reporting company as defined by Rule 12b-2 under the Exchange Act and is not required to provide the information required under this item.

Item 4. Controls and Procedures.

Under the supervision and with the participation of our management, including the President/Principle Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, the President/Principal Financial Officer have concluded that these disclosure controls and procedures are effective.

There were no changes in our internal control over financial reporting during the three months ended December 31, 2008 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

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. Except as described below, we are currently not aware of any such legal proceedings that we believe will have, individually or in the aggregate, a material adverse affect on our business, financial condition or operating results.

The Company is a defendant in pending litigation by Deep Well Oil & Gas, Inc. (“Deep Well”) in the United States District Court of Nevada. The litigation involves an alleged breach by the Company of federal securities law requirements for an alleged tender offer to Deep Well’s shareholders, in addition to claims for fraud and defamation relating to certain press releases and securities law filings of the Company. The complaint seeks injunctive relief and unspecified damages. The Company's position in this litigation is that the subject transactions were private stock exchange agreements between the Company and certain Deep Well shareholders and did not constitute a tender offer. The Company denies the other allegations in the Complaint as well. The Company filed its opposition to a motion for preliminary injunction and a motion to dismiss, and Deep Well failed to dismiss the suit. The Company filed a motion for partial summary judgment, to which Deep Well opposed and also filed its First Amended Complaint, which adds a claim for conspiracy against the Company, and other parties. The Company moved to dismiss the Complaints. Briefing is scheduled to be completed by March 10, 2009 and the matter will be submitted to the court for hearing and decision.

As previously reported, as of July 1, 2008, we entered into a termination and rescission agreement with each of such Deep Well shareholders (collectively the “Termination and Rescission Agreements”) pursuant to which we and the Deep Well shareholders agreed to rescind the transactions consummated under the stock exchange agreements with the same effect as if the agreements had never been executed and delivered and such transactions had never been consummated. The rescission was undertaken voluntarily by the Company and is neither an admission of any wrongdoing by the Company nor a waiver of any rights or remedies which the Company may have against any person (except for such Deep Well shareholders pursuant to the terms of the Termination and Rescission Agreements).

All of the 21,533,000 shares the Company issued pursuant to the stock exchange agreements have now been returned to the Company, and all of the certificates representing the shares have been cancelled.

Item 1A - Risk Factors

The following risks and uncertainties, along with other information contained in this Form 10-Q, should be carefully considered by anyone considering an investment in our securities. The occurrence of any of the following risks could negatively affect our business, financial condition and operating results.

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Our financial condition raises substantial doubt about our ability to continue as a going concern.

During the period from our inception of October 10, 2005 to our year end at December 31, 2008, we have an accumulated deficit of $61,919,312. Our auditors have issued a going concern opinion indicating that our significant operating losses and working capital deficit and inability to generate any revenues cause substantial doubt about our ability to continue as a going concern, and that there is uncertainty as to whether we have the capability to continue our operations without additional funding. Accordingly, we anticipate that we will need additional funding during the next 12 months, which we plan to seek through public or private equity financing, bank debt financing, or from other sources; however, adequate funds may not be available when needed, and even if we raise additional funds through sales of our equity securities, existing stockholder interests will be diluted.

We lack an operating history in our current business plan, which make it difficult for you to evaluate whether we will be able to continue our operations or ever be profitable.

In October 2007, we began our current business plan of conducting exploration for heavy oil. Our short operating history has consisted of preliminary acquisition and exploration activities and non-income-producing activities. Accordingly, we have no adequate operating history for you to evaluate our future success or failure.

Because we are an exploration stage company, we currently have no significant operations, and our future operations are subject to substantial risks, we may be unsuccessful in conducting our operations.

We are an early stage oil exploration company and have not commenced oil production. We will be unable to generate revenues or make profits, unless we actually commence significant production.

We are subject to substantial regulation of our business, including requirements to obtain numerous licenses and permits in the operation of our business; if we are denied needed government licenses and permits or otherwise fail to comply with federal and state requirements, we may be subject to increased compliance costs and fines or penalties.

Our future exploration activities will require licenses, permits, or compliance with other state and federal requirements, including:

· Acquiring permits before commencing drilling;

· Restricting substances that can be released into the environment with drilling and production activities;

· Limiting or prohibiting drilling activities on protected areas such as wetlands or wilderness areas;

· Requiring that reclamation measures be taken to prevent pollution from former operations;

· Requiring remedial measures to mitigate pollution from former operations, such as plugging abandoned wells and remediation of contaminated soil and groundwater; and

· Requiring remedial measures to be taken with respect to property designated as a contaminated site.

Additionally, we could be liable for personal injury, clean-up costs and other environmental and property damages, as well as administrative, civil and criminal penalties. Although we maintain limited insurance coverage for sudden and accidental environmental damages as well as environmental damage that occurs over time, we have not obtained coverage for the full potential liability of environmental damages since we do not believe that we can obtain insurance coverage for the full potential liability of environmental damages is available at a reasonable cost. Accordingly, we could be liable, or could be required to cease production on properties, if environmental damage occurs. Delays or failures to acquire required licenses or permits or successfully comply with the pertinent federal and state regulations will negatively impact our operations.

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The successful implementation of our plan of operations is subject to risks inherent in the oil and gas business.

Our oil and gas operations are subject to the economic risks associated with exploration, development and production activities, including substantial expenditures to locate and acquire properties and to drill exploratory wells. Additionally, the cost and timing of drilling, completing and operating wells may be uncertain. The presence of unanticipated pressure or irregularities in formations, miscalculations or accidents may cause our exploration, development and production activities to be delayed or unsuccessful, and may result in the total loss of our investment in a particular property.

Our ability to produce sufficient quantities of oil and gas from our properties may be adversely affected by factors outside of our control.

We are an early stage oil exploration company and have not commenced significant oil production. We will be unable to generate revenues or make profits, unless we actually commence significant oil production. Drilling, exploring and producing oil and gas involves various substantial risks beyond our control, including: 

· unproductive wells

· productive wells that are unable to produce oil or gas in economically feasible quantities;

· hazards, such as unusual or unexpected geological formations, pressures, fires, blowouts, loss of circulation of drilling fluids or other conditions that may substantially delay or prevent completion of any well;

· adverse weather conditions hindering drilling operations;

· a productive well becoming uneconomic due to pressure depletion, water encroachment, mechanical difficulties, or other factors, which impair or prevent the production of oil and/or gas from the well;

· operations being adversely affected by the proximity and capacity of oil and gas pipelines and processing equipment;

· market fluctuations of taxes, royalties, land tenure; and

· allowable production and environmental protection.

We rely upon third parties in our business which could adversely affect our business.

We rely upon third parties, including: (a) those that assist us in identifying desirable oil and gas prospects to acquire and to provide us with technical assistance and services; (b) the services of geologists, geophysicists, chemists, engineers and other scientists to explore and analyze oil prospects to determine a method in which the oil prospects may be developed in a cost-effective manner; and (c) owners and operators of oil drilling equipment to drill and develop our prospects to production. Although we have developed relationships with a number of third-party service providers, we cannot assure that we will be able to continue to rely on such persons. If any of these relationships with third-party service providers are terminated or are unavailable on commercially acceptable terms, we may be unable to execute our operational plan.

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Market fluctuations in the prices of oil & gas could adversely affect our business.

Prices for oil and natural gas tend to fluctuate significantly in response to factors beyond our control, including:

· actions of the Organization of Petroleum Exporting Countries and its production constraints;

· United States economic environment;

· weather conditions;

· availability of alternate fuel sources;

· transportation interruption;

· the impact of drilling levels on crude oil and natural gas supply; and

· the environmental and access issues that could limit future drilling activities industry wide.

Additionally, changes in commodity prices affecting our capital resources, liquidity and expected operating results. Price changes directly affect revenues and can indirectly impact expected production by changing the amount of funds available to reinvest in exploration and development activities. Reductions in oil and gas prices not only reduce revenues and profits, but could also reduce the quantities of reserves that are commercially recoverable. Significant declines in prices could result in charges to earnings due to impairment. Changes in commodity prices may also significantly affect our ability to estimate the value of producing properties for acquisition and divestiture and often cause disruption in the market for oil producing properties, as buyers and sellers have difficulty agreeing on the value of the properties. Price volatility also makes it difficult to budget for and project the return on acquisitions and development and exploitation of projects. We expect that commodity prices will continue to fluctuate significantly in the future.

Our President devotes less than full time to our business, which may negatively impact our operations.

Wiktor Musial, our President, devotes only 10 hours per week to our business. Because our President may be unable to devote the time necessary to our business, we may be unsuccessful in implementing our operational plan.

The services of our President, Vice President of Operations, and Chairman of the Board are essential to the success of our business; the loss of any of these personnel will adversely affect our business. 

Our business depends upon the continued involvement of our President, Vice President of Operations, and Chairman of the Board, who collectively have oil related experience of at least 60 years. The loss, individually or cumulatively, of these personnel would adversely affect our business, prospects, and our ability to successfully conduct our exploration activities. Before you decide whether to invest in our common stock, you should carefully consider that the loss of their expertise, may negatively impact your investment in our common stock.

Item 2 - Recent Sales of Unregistered Securities and Use of Proceeds

None.

Item 3 - Defaults on Senior Securities

None.

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

None.

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Item 5 - Other Information

None.

Item 6 Exhibits

The following exhibits, required by Item 601 of Regulation S-K, are being filed as part of this quarterly report, or are incorporated by reference where indicated:

Exhibit No.	Description
31.1*	Certification pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended (Principal Executive Officer and Principal Financial Officer).
32.1*	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer and Principal Financial Officer).

* filed herewith

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TAMM OIL AND GAS CORP.
Date:  February 17, 2009	By:	/s/ Wiktor Musial
		Name:  Wiktor Musial Title:     President/Principal Executive Officer/Principal Financial Officer

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