Trans-Pacific Aerospace (TPAC) 10-Q 2009 Q2 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

(X)        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended January 31, 2009

OR

( )         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF

                    THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to ______________.

Commission File Number:  333-148447

PINNACLE ENERGY CORP.

------------------------------------------------

(Exact name of Registrant as specified in its charter)

Nevada                                       36-4613360

---------------------------                      ---------------------

State or other jurisdiction                         (IRS) Employer

of incorporation                             Identification Number

29377 Rancho California Rd., Suite 204

Temecula, CA 92591

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Address of principal executive offices

(951) 676-4900

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Registrant's telephone number, including area code

Not Applicable

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(Former name, former address and formal 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) had 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, and accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller

reporting company" in Rule 12b-2 of the Exchange Act. (Check One):

      Large accelerated filer [ ]                  Accelerated filer [ ]

      Non-accelerated filer [ ]                    Smaller reporting company [X]

(Do not check if a smaller reporting company)

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

Yes ____           No __X__

                                                      -

Class of Stock           No. Shares Outstanding                                                                                               Date

--------------                            ----------------------                                         ----

Common                      15,840,000                                                                                  May 31, 2009

PINNACLE ENERGY CORPORATION
(A Development Stage Company)
Balance Sheet
				April 30	October 31,
				2009	2008
ASSETS				(Unaudited)
	Current Assets
			Cash at bank	$              3,541	$              9,366
			Accounts Receivable	-	19,006
		Total Current Assets		$              3,541	28,372.00
	Property and Equipment
			Equipment	100,000	100,000
			Accumulated Depreciation	(15,000)	(10,000)
		Total property & Equipment		85,000	90,000
	Other Assets
		Oil & Gas Leasehold Interest		1,190,000	1,190,000
	Total Assets			$        1,278,541	$        1,308,372
LIABILITIES AND SHAREHOLDERS' EQUITY
	Current Liabilities
			Accrued Interest Payable	53,335	13,333
	Notes Payable			1,000,000	1,000,000
			Total Liabilities	1,053,335	1,013,333
	Stockholders' Equity
		Common Stock, par value $0.001,
			authorized 150,000,000 shares; issued and outstanding:
			15,840,000 shares as at October 31, 2008
			15,840,000 shares ast at January 31, 2009	15,840	15,840
		Additional Paid-In Capital		340,461	340,461
		Deficit accumulated during the development stage		(131,095)	(61,262)
			Total Stockholders' Equity	225,206	295,039
	Total Liabilities and Stockholers' Equity			$        1,278,541	$        1,308,372

The accompanying Notes are in integral part of these financial statements

PINNACLE ENERGY CORPORATION
(A Development Stage Company)
Statement of Operations
(Unaudited)
						For the Period
						of Inception
						from June 5,
		For the three months ended		For the six months ended		2007, through
		April 30		April 30		January 31,
		2009	2008	2009	2008	2009
Revenues		$ 7,869	$ 4,363	$17,348	$ 8,926	$ 67,999
Cost of Sales		-	-	-	-	-
Operating Income		7,869	4,363	17,349	8,926	67,999
General and Administrative Expenses
	Professional Fees	2,990	900	4,115	15,950	33,580
	Consulting Fees	7,871	-	28,133	14,864	64,467
	Occupancy Costs	476	2,500	1,929	6,000	11,834
	Repairs & Maintenance	-	-	-	-	1,231
	Depreciation	2,500	1,250	5,000	2,500	15,000
	Other General and administrative expenses	3,105	6,579	8,005	9,544	19,649
Total General and Administrative
	Expenses	16,942	11,229	47,182	48,858	145,761
Net Loss before Other
	Expenses	(9,073)	(6,866)	(29,833)	(39,932)	(77,762)
	Interest	(20,000)	-	(40,000)	-	(53,333)
Net Income (Loss)		$(29,073)	$(6,866)	$(69,833)	$(39,932)	$  (131,095)
Basic and dilutive loss per share		$(0.001)	$(0.000)	$(0.002)	$ (0.003)
Weighted average number of
common shares outstanding		15,840,000	15,840,000	15,840,000	15,840,000

The accompanying Notes are in integral part of these financial statements

PINNACLE ENERGY CORPORATION.
(A Development Stage Company)
Statement of Cash Flows
(Unaudited)
					For the Period
					of Inception
			For the six months ended		from June 5,
			April 30,		2007, through
			2009	2008	April 30, 2009
Cash flows from operating activities:
	Net (Loss)		$      (69,833)	$   (39,932)	$     (131,095)
	Adjustments to reconcile net loss to
	net cash used by operating activities:
	Non-cash depreciation		5,000	2,500	15,000
	Change in operating assets and liabilities:
		(Increase) Decrease in Accts Receivable	19,006	(5,912)	-
		Increase (Decrease) in Accounts Payable			-
		Increase (Decrease) in Accrued Interest	40,000	-	53,335
	Net cash (used by) operating  activities		(5,827)	(43,344)	(62,760)
Cash flows from investing activities
	Acquisition of equipment		-	-	(100,000)
	Acquistion of oil & gas working interest		-	-	(1,190,000)
	Net cash (used by) investing activities		-	-	(1,290,000)
Cash flows from financing activities:
	Decrease Subscriptions Receivable		-	18,000	-
		Proceeds of Note Payable	-	-	1,000,000
	Common stock issued for assets		-	-	90,000
	Common stock issued for cash		-	-	266,301
Net cash (used) provided by
		financing activities	-	18,000	1,356,301
Net increase (decrease) in cash			(5,827)	(25,344)	3,541
Cash, beginning of the period			9,368	36,169	-
Cash, end of the period			$         3,541	$     10,825	$          3,541
Supplemental cash flow disclosure:
	Interest paid		$               -	$             -	$                -
	Taxes paid		$               -	$             -	$                -

The accompanying Notes are in integral part of these financial statements

PINNACLE ENERGY CORPORATION
(A Development Stage Company)
Statement of Stockholders' Equity
(Unaudited)
				Deficit
				Accumulated	Total
	Common Stock		Additional	during the	Shareholders'
	Number of		Paid-In	Development	Equity
	Shares	Amount	Capital	Stage	(Deficit)
Inception, June 5, 2007	-	$        -	$          -	$            -	$             -
Common stock issued for cash at $0.096 per
share September 5, 2007	2,580,000	2,580	245,721		248,301
Common stock issued for cash at $0.01 per
share September 5, 2007	1,800,000	1,800	16,200		18,000
Common stock issued for oil and gas working
interest at $0.10 per share Sep. 5, 2007	900,000	900	89,100		90,000
Net loss for the period ended Oct. 31, 2007				(13,363)	(13,363)
Balances, October 31, 2007	5,280,000	$  5,280	$351,021	$  (13,363)	$   342,938
Forward stock split 3 for 1 July 27, 2008	10,560,000	10,560	(10,560)		-
Net loss for the year ended October  31, 2008				(47,899)	(47,899)
Balances, October 31, 2008	15,840,000	$15,840	$340,461	$  (61,262)	$   295,039
Net loss for the 6 mo. ended Jan. 31, 2009				(69,833)	(69,833)
Balances, January 31, 2009	15,840,000	$15,840	$340,461	$(131,095)	$   225,206

The accompanying Notes are in integral part of these financial statements

Pinnacle Energy Corporation

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2009

(Unaudited)

1.   Basis of Presentation and Nature of Operations

The interim financial statements as of and for the 6 months ended 4/30/2009 reflect all adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows for the period presented in accordance with the accounting principles generally accepted in the United States of America. 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 October 31, 2008 report.   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 period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context.  The results of operations for the six month period ended April 30, 2009 are not necessarily indicative of results for the entire year ending October 31, 2009.

Organization

The Company was incorporated as Gas Salvage, Inc. under the laws of the State of Nevada June 5, 2007. The Company was organized for the purpose of engaging in any activity or business not in conflict with the laws of the State of Nevada or of the United States of America.  The company became engaged in the oil and gas industry. In July, 2008 the Company changed its name to Pinnacle Energy Corporation.

Current Business of the Company

The Company purchased a 44.5% leasehold interest (35.6% net revenue interest) in a producing gas well on 40 acres in Lincoln County, Oklahoma, known as Holmes #1.  The well was initially shut in awaiting repairs to its Nitrogen Rejection Unit.  The well was put into production in November, 2007.  A geologist’s report on December 18, 2007 indicated that the lease is selling between 85 and 100 MCF per day, however volumetric calculations of the Holmes Lease reservoir have not yet been performed.  An examination as to whether the well warrants impairment based on expected revenue hinges upon performance of volumetric calculations.

On September 1, 2008 the Company acquired working interests in six oil and gas wells located in Pawnee County, Oklahoma for $1,000,000, payable September 1, 2013.  Interest at an annual rate of 8% is due monthly. The working interests consist of a 25.5% working interest (20.4% net revenue interest) in two wells, a 20% working interest (16% net revenue interest) in three wells and a 17% working interest (13.6% net revenue interest) in the remaining well.

Property Acquisition Costs:  Unproved

  Holmes Lease     $    190,000

Pawnee County Lease              $ 1,000,000

$ 1,190,000

2.    Summary of Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period.  Actual results could differ materially from those estimates. Significant estimates made by management are, among others, realizability of long-lived assets, deferred taxes and stock option valuation.

Cash and equivalents

Cash and equivalents include investments with initial maturities of three months or less.

Fair Value of Financial Instruments

The Financial Accounting Standards Board issued Statement of Financial Accounting Standards (“SFAS”) No. 107, “Disclosures About Fair Value of Financial Instruments.” SFAS No. 107 requires disclosure of fair value information about financial instruments when it is practicable to estimate that value.  The carrying amounts of the Company’s financial instruments as of January 31, 2009 approximate their respective fair values because of the short-term nature of these instruments.  Such instruments consist of cash, accounts payable and accrued expenses.  The fair value of related party payables is not determinable.

Income Taxes

The Company utilizes SFAS No. 109, “Accounting for Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns, including loss crryforwards.  Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company generated a deferred tax credit through net operating loss carryforward.  However, a valuation allowance of 100% has been established, as the realization of the deferred tax credits is not reasonably certain, based on going concern considerations outlined as follows.

Going Concern

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern. The company experienced a loss of $69,833 in the first six months of the current fiscal year.  The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable.  If the Company is unable to obtain adequate capital, it could be forced to cease development of operations.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its plans to generate revenue from well head machinery and oil and gas leases.   The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classifications or liabilities or other adjustments that might be necessary should the Company be unable to continue as a going concern.

Development-Stage Company

The Company is considered a development-stage company, with limited operating revenues during the periods presented, as defined by Statement of Financial Accounting Standards (“SFAS”) No. 7.  SFAS.  No. 7 requires companies to report their operations, shareholders deficit and cash flows since inception through the date that revenues are generated from management’s intended operations, among other things.  Management has defined inception as June 5, 2007. Since inception, the Company has incurred an operating loss of $131,095. The Company’s working capital has been generated through the sales of common stock and limited oil and gas revenue.  Management has provided financial data since June 5, 2007, “Inception”, in the financial statements, as a means to provide readers of the Company’s financial information to make informed investment decisions.

Basic and Diluted Net Loss Per Share

Net loss per share is calculated in accordance with SFAS 128, Earnings Per Share for the period presented.  Basic net loss per share is based upon the weighted average number of common shares outstanding.  Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised.  Dilution is computed by applying the treasury stock method.  Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby we used to purchase common stock at the average market price during the period.

The Company has no potentially dilutive securities outstanding as of January 31, 2009.

The following is a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations for the three months ended January 31, 2009 and 2008.

 2009                                               2008

Numerator:

Basic and diluted net loss per share:

Net Loss                                                                $ (69,833)                                    $ (39,932)

Denominator

Basic and diluted weighted average

  number of shares outstanding                                         15,840,000                                   15,840,000

Basic and Diluted Net Loss Per Share                  $ (0.002) $ (0.003)

Accounting for Oil and Gas Producing Activities

The company uses the successful efforts method of accounting for oil and gas producing activities.  Under this method, acquisition costs for proved and unproved properties are capitalized when incurred.

Acquisition costs are capitalized when incurred pending the determination of whether a well has found proved reserves.  A determination of whether a well has found proved reserves is made within a year of acquisition.

If after that year has passed, a determination that proved reserves exist cannot be made, the well is assumed to be impaired, and its costs are charged to expense.  It’s costs can however, continue to be capitalized if a sufficient quantity of reserves are discovered in the well to justify its completion as a producing well and sufficient progress is made assessing the reserves and the well’s economic and operating feasibility.  The impairment of unamortized capital costs is measured at a lease level and is reduced to fair value if it is determined that the sum of expected future net cash flows is less than the net book value.

The company determines if impairment has occurred through either adverse changes or as a result of the annual review of all fields.  Since acquisition of the fields in September 2007 and September 2008 the company has not recorded any impairment, pending volumetric calculations.  Development costs of proved oil and gas properties, including estimated dismantlement, restoration and abandonment costs and acquisition costs, are depreciated and depleted on a field basis by the units-of-production method using proved reserves, respectively.

The Costs of unproved oil and gas properties are generally combined and impaired over a period that is based on the average holding period for such properties and the company’s experience of successful operations.

Oil and Gas Revenue Recognition

The company applies the sales method of accounting for natural gas revenue.  Under thus method, revenues are recognized based on the actual volume of natural gas sold to purchasers.  Revenue from the sale of gas is reported by the gas gathering company monthly and paid two months in arrears.

3.           Property and Equipment

Equipment                                $100,000

The Company purchased a 50% interest in a skid mounted Nitrogen Rejection unit in October, 2005. The unit strips out excessive nitrogen and oxygen from gas wells to an acceptable  level of contaminants in the gas stream.  The unit is intended for use on the Company’s gas wells.  The unit commenced operations in November, 2007 under the control of the gas collection operator.

4.           Note Payable

The Company issued a promissory note to Futures Investment Corporation on September 1, 2008 for $1,000,000 in payment for an oil and gas working interest in Pawnee County, Oklahoma.  The note is payable on September 1, 2013.  Interest is payable monthly at the rate of 8% simple interest.

5.           Commitments and Contingencies

The company is committed to the following financial commitment over the next five years:

$1,000,000, 8% Note Payable:

Annual interest:                                                                     $80,000

Repayment September 1, 2013:                                            $1,000,000.

8.   Restatements

The issued and outstanding shares and weighted average shares outstanding in the financial statements of April 30, 2008 were restated to reflect retroactively the three-for-one forward stock split of July 27, 2008.

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of financial condition and results of operations should be read in conjunction with the consolidated financial statements and the notes to the consolidated financial statements, which are included elsewhere in this report.

Pinnacle was incorporated on June 5, 2007. In September 2007 Pinnacle acquired a 44.5% working interest (35.6% net revenue interest) in a gas well located in Lincoln County, Oklahoma for $100,000 in cash and 900,000 shares of its restricted common stock. At the time it acquired its interest in the gas

well, Pinnacle also acquired, for $100,000, a 50% interest in a portable unit which reduces the amount of nitrogen and oxygen from the gas produced by the well. The gas well was put into production in November 2007. As of January 31, 2009 the well was shut in and awaiting repairs.

On August 27, 2008 Pinnacle acquired working interests in six oil and gas wells located in Pawnee County, Oklahoma. Pinnacle has a 25.5% working interest (20.4% net revenue interest) in two wells, a 20% working interest (16% net revenue interest) in three wells , and a 17% working interest (13.6% net revenue interest) in the remaining well.

As of January 31, 2009 five wells were producing ten barrels of oil and eight MCF of gas per day, net to Pinnacle's interest. The sixth well is being used as a salt water disposal well.

The price for Pinnacle's interest in the six wells was $1,000,000. The purchase price requires monthly interest payments at 8% per year until September 1, 2013, at which time the entire $1,000,000 is due.

RESULTS OF OPERATIONS

The factors that most significantly affect Pinnacle's results of operations will be (i) the sale prices of crude oil and natural gas, (ii) the amount of production from oil or gas wells in which Pinnacle has an interest,

and (iii) and lease operating expenses. Pinnacle's revenues will also be significantly impacted by its ability to maintain or increase oil or gas production through exploration and development activities.

Prices received by Pinnacle for sales of crude oil and natural gas may fluctuate significantly from period to period. The fluctuations in oil prices during these periods reflect market uncertainty regarding the inability of the Organization of Petroleum Exporting Countries ("OPEC") to control the production

of its member countries, as well as concerns related to the global supply and demand for crude oil. Gas prices received by Pinnacle will fluctuate with changes in the spot market price for gas.

Changes in natural gas and crude oil prices will significantly affect the revenues and cash flow of the wells and the value of the oil and gas properties. Declines in the prices of crude oil and natural gas could have a material adverse effect on the success of Pinnacle's operations and activities, recoupment of the costs of acquiring, developing and producing its wells and profitability. Pinnacle is unable to predict whether the prices of crude oil and natural gas will rise, stabilize or decline in the future.

Other than the foregoing, Pinnacle does not know of any trends, events or uncertainties that have had or are reasonably expected to have a material impact on Pinnacle's net sales, revenues or expenses.

LIQUIDITY AND CAPITAL RESOURCES

It is expected that Pinnacle's principal source of cash flow will be from the production and sale of crude oil and natural gas reserves which are depleting assets. Cash flow from the sale of oil and gas production depends upon the quantity of production and the price obtained for the production. An increase in prices will permit Pinnacle to finance its operations to a greater extent with internally generated funds, may allow Pinnacle to obtain equity financing more easily or on better terms, and lessens the difficulty of obtaining financing. However, price increases heighten the competition for oil and gas prospects, increase the costs of exploration and development, and, because of potential price declines, increase the risks associated with the purchase of producing properties during times that prices are at higher levels.

A decline in oil and gas prices (i) will reduce the cash flow internally generated by Pinnacle which in turn will reduce the funds available for exploring for and replacing oil and gas reserves, (ii) will increase the difficulty of obtaining equity and debt financing and worsen the terms on which such financing may be obtained, (iii) will reduce the number of oil and gas prospects which have reasonable economic terms, (iv) may cause Pinnacle to permit leases to expire based upon the value of potential oil and gas reserves in relation to the costs of exploration, (v) may result in marginally productive oil and gas wells being abandoned as non-commercial, and (vi) may increase the difficulty of obtaining financing. However, price declines reduce the competition for oil and gas properties and correspondingly reduce the prices paid for leases and prospects.

INTERIM PERIODS

Material Changes in Financial Condition and Results of Operations

At April 30, 2009, we had working capital of $(49,794) compared to working deficit of $(15,039) at October 31, 2008.  At April 30, 2009, our total assets consisted of $1,190,000 in oil and gas leasehold interests, $3,541 in cash and $100,000 in equipment less $15,000 in depreciation, compared to total assets consisted of $1,190,000 in oil and gas leasehold interests, $100,000 in equipment less $10,000 in depreciation, $19006 in accounts receivable and $9,366 in cash, as of December 31, 2007.

At April 30, 2009, our total current liabilities increased to $53,335 as compared with $13,333 at October 31, 2008.

Our revenues for the three months ended April 30, 2008 were $7,869 compared to $4,363 during the same period from the previous year. We posted a net loss of $(29,073) for the quarter ended April 30, 2009, compared to a net loss of $(6,866) for the quarter ended April 30, 2009.  The increase in our net loss was mainly attributable to $20,000 in interest expense compared to no interest expense in the period from the prior year and an increase in professional fees to $2,990 from $900 and consulting fees of $7,871 compared to no consulting fees from the period for the prior year. Such increased expenses were partially offset by a decrease in other general and administrative expenses to $3,105 from $6,579.

Our revenues for the six month period ended April 30, 2009 were $17,348 compared to $8,926 for the same period from the previous year. We posted a net los of $(69833) for the six month period ended April 30, 2009, compared to a net loss of $(39,932) for the same period from the previous year. The increase in our net loss for this six month period was attributable to $40,000 in interest expense compared to no interest expense for the six-month period from the prior year. We also incurred increased consulting fees to $28,133 from $14,864 and increased depreciation to $5,000 from $2,500. These increases were offset by a decrease in professional fees to $4,115 from $15,950 and occupancy costs to $1,929 from $6,000.

From inception to April 30, 2009, we have incurred losses of $(131,095).  The principal components of losses since inception were consulting fees of $64,467, interest expense of $53,333, professional fees of $33,580, other general and administrative expenses of $19,649 and depreciation of $15,000.

Pinnacle does not anticipate that it will need to hire any employees during the twelve month period ending April 30, 2010.

Pinnacle's future plans will be dependent upon the amount of capital Pinnacle is able to raise. Pinnacle may attempt to raise additional capital through the private sale of its equity securities or borrowings from third party lenders. Pinnacle does not have any commitments or arrangements from any person to provide Pinnacle with any additional capital. If additional financing is not available when needed, Pinnacle may continue to operate in its present mode or Pinnacle may need to cease operations. Pinnacle does not have any plans, arrangements or agreements to sell its assets or to merge with another entity.

Pinnacle plans to generate profits by drilling productive oil or gas wells. However, Pinnacle will need to raise the funds required to drill new wells from third parties willing to pay Pinnacle's share of drilling and

completing the wells. Pinnacle may also attempt to raise needed capital through the private sale of its securities or by borrowing from third parties. Pinnacle may not be successful in raising the capital needed to drill oil or gas wells. In addition, any future wells which may be drilled by Pinnacle may not be

productive of oil or gas. The inability of Pinnacle to generate profits may force Pinnacle to curtail or cease operations.

Contractual Obligations

-----------------------

As of April 30, 2009 Pinnacle did not have any material capital commitments, other than funding its operating losses. It is anticipated that any capital commitments that may occur will be financed principally through the sale of shares of Pinnacle's common stock or other equity securities. However, there can be no assurance that additional capital resources and financings will be available to Pinnacle on a timely basis, or if available, on acceptable terms.

Item 4.T.   CONTROLS AND PROCEDURES

The Company's management is responsible for establishing and maintaining adequate internal control over financial reporting as required by Sarbanes-Oxley (SOX) Section 404.A. The Company's internal control over financial reporting is a process designed under the supervision of its Chief Executive and Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of its financial statements for external purposes in accordance with Generally Accepted Accounting Principles.

There were no changes in the Company's internal controls over financial reporting that occurred during the quarter ended January 31, 2009 that have affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

Nolan Weir, the Company's President and Principal Financial Officer, evaluated the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this report; and in his opinion the Company's disclosure controls and procedures were effective.

PART II

Item 6.   (a)    Exhibits

Number      Exhibit

------      -------

   31       Rule 13a-14(a) Certifications

   32       Section 1350 Certifications

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.

                                          PINNACLE ENERGY CORP.

Date:  June 22, 2009       /s/ W. Scott Lawler

                                          ------------------------------

                                          W. Scott Lawler, President, Principal

                                          Financial Officer and Principal

                                          Accounting Officer