Earth Search Sciences 10K 2009 Annual report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K


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

For the Fiscal Year Ended March 31, 2009


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

for the transaction period from to

Commission File Number 000-19566

EARTH SEARCH SCIENCES, INC.

(Name of Small Business Issuer in its charter)


Nevada		870437723
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)

306 Stoner Loop Road, #6, Lakeside, Montana		59922
(Address of principal executive offices)		(Zip code)

Issuer’s telephone number (406) 751-5200

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.001 per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes  No

Indicate by check mark if the registrant is not required to file reports pursuant to section 13 and section 15(d) of the Act.

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such 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  No

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

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

 Large accelerated filer

 Accelerated filer

 Non-accelerated filer

 Smaller reporting company

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

Issuer’s revenues for its most recent fiscal year were $0.

The aggregate market value of the issuer’s voting and non-voting common equity held by non-affiliates (104,256,473 shares) was approximately $2,085,129, based on the average closing bid and ask price of $0.02 for such common equity as of March 31, 2009.

As of June 26, 2009, there were 194,655,705 outstanding shares of the issuer’s Common Stock, par value $0.001.

Transitional Small Business Disclosure Format (check one): Yes  No 

FORWARD LOOKING STATEMENTS

Some of the statements under “Management’s Discussion and Analysis of Financial Condition or Plan of Operations,” and “Description of Business” in this Annual Report on Form 10-KSB are forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our 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 forward-looking statements.

In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other “forward-looking” information. There may be events in the future that we are not able to accurately predict or control. Before you invest in our securities, you should be aware that the occurrence of any of the events described in this Annual Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline and you could lose all or part of your investment. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Annual Report to conform these statements to actual results.

TABLE OF CONTENTS

PART I		4
Item 1 -	Business	4
Item 1A	Risk Factors	5
Item 1B	Unresolved Staff Comments	7
Item 2 -	Properties	7
Item 3 -	Legal Proceedings	7
Item 4 -	Submission of Matters to a Vote of Security Holders	7

PART II		8
Item 5 -	Market for the Registrant's Common Stock Equity and Related Shareholder Matters	8
Item 7 -	Management's Discussion and Analysis or Plan of Operations	10
Item 8 -	Financial Statements	F1 - F13
Item 9 -	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	24
Item 9A(T)	Controls and Procedures	24
Item 9B -	Other Information	25

PART III		26
Item 10 -	Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance With Section 16(a) of the Exchange Act	26
Item 11 -	Executive Compensation	28
Item 12 -	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	29
Item 13 -	Certain Relationships and Related Transactions, and Director Independence	30
Item 14 -	Principal Accountant Fee and Services	30
Item 15 -	Exhibits, Financial Statement Schedules	31

SIGNATURES		34

PART I

ITEM 1. BUSINESS

Earth Search Sciences, Inc. (ESSI) was incorporated in 1984 in Utah. We did not generate any revenue during fiscal year 2009, have no current business operations and are currently focused on two potential business ventures.

First, we are working with certain investors to develop and employ technology in the extraction of oil and gas from oil shale. During the third quarter ESSI acquired General Synfuels International, Inc, owner of the world-wide proprietary rights, patent, technology, construction plans and materials and operational capability for a gasification process to recover the oil and gas from oil shale. GSI has begun to refine the design and begin development of our proof of concept prototype. However, the current state of the financial markets has negatively impacted our ability to raise the additional funds necessary to complete our prototype. Our current plan is to begin a field test of this technology as early as the fourth quarter of 2009 and subsequent commercial development as early as 2011. Additionally we have secured oil shale land in both Wyoming and Colorado.

GSI continues to develop additional patents related to our technology and as part of that process we are exploring a tar sands and carbon sequestration application. We anticipate the tar sands application to be used internationally.

Second, we are seeking joint venture opportunities with private industry, universities and state and federal agencies to develop, package and deliver, through the application of our hyperspectral remote sensing solutions, applications and associated technologies, airborne mapping products and services. Our airborne hyperspectral remote sensing technology is designed to identify specific surface substances and materials by measuring the reflectance of light from their surface. Their first spectroscopic instrument, the PROBE 1, was initially developed with the assistance of NASA and used a small aircraft as the instrument platform to obtain data from high altitudes over many different terrains. The information was precise enough to enable detailed analysis of a dynamic environment or object in a manner previously unattainable, and can be used for the discovery of certain natural resources.

Exploitation of Oil and Gas from Oil Shale

On August 15th of 2008 ESSI acquired all of the outstanding shares of General Synfuels International, Inc. (GSI), an entity controlled by certain management and directors of ESSI. This transaction was accounted for as an asset purchase due to the fact that GSI was dormant, did not have customers or employees and only held certain proprietary rights, patent, technology and construction plans for a gasification process to recover the oil and gas from oil shale. In addition, the asset was recorded at its historical cost due to the fact that this transaction was between entities under common control. Prior to the acquisition, both entities were controlled by certain members of management. The $5,494,700 value in excess of the historical cost of the asset was recorded as compensation expense.

ESSI paid the individual GSI Shareholders $5,500,000: 33,333,333 shares of common stock valued at $3,000,000 based on the closing price of ESSI’s stock on the date of the transaction; and $2,500,000 in the form of promissory notes payable to the GSI shareholders in five equal payments of $500,000. ESSI is currently negotiating a change in the payment terms of the notes at ESSI’s election, each promissory note payable can be converted into ESSI common stock at a 40% discount to the average trading price of ESSI common stock 5 days prior to the emission of payment. Because this transaction was between related parties, the patent asset was recorded at its historical cost of $5,300 and the remaining value of $5,494,700 was recorded as compensation expense for the period ended September 30, 2008, as the shareholders didn’t contribute any additional assets, tangible or intangible of value. ESSI has also entered into a Consulting Agreement with each of the GSI Shareholders. The GSI Shareholders are Ken Danchuk, Ron McQueen and Larry Vance.

Due to the current market conditions and fund raising environment ESSI is currently in negotiations with the GSI acquisition note holders to restructure the promissory notes. These notes are currently in default.

GSI has secured private oil shale sites in Colorado and Wyoming for a test plant. Although delayed GSI has started the process of applying for a Bureau of Land Management R&D oil shale lease. The test plant is budgeted for approximately $8 million as a first stage development cost. The purpose of this plant is to prove the technology.

We have engaged Industrial Systems, Inc. (ISI) as the primary engineering and fabrication firm supporting our Oil Shale Recovery Project. ISI is strategically located and has the growth potential needed to support our future commercial developments. During the year ending March 31, 2009 we capitalized approximately $915,000 in payments to ISI, in the form of deposits, related to the development of our oil shale gasification prototype. The deposits were used to fund design and construction costs incurred during the period ended March 31, 2009. Once the prototype is complete, further investment will be required for commercial production.

Hyperspectral Remote Sensing Solutions

In the past, we have utilized an aircraft mounted hyperspectral remote sensing instrument to gather precise geological data from the surface of the Earth. Solar energy is reflected from surface materials and the instrument, called "Probe-1", captures the data in digital form. The Probe-1 is a "whiskbroom style" instrument that collects data in a cross-track direction by mechanical scanning and in an along-track direction by movement of the airborne platform. The instrument acts as an imaging spectrometer in the reflected solar region of the electromagnetic spectrum (0.4 to 2.5 nm). In the VNIR and SWIR, the at-sensor radiance is dispersed by four spectrographs onto four detector arrays. Spectral coverage is nearly continuous in these regions with small gaps in the middle of the 1.4 and 1.9 nm atmospheric water bands. In order to avoid geometric distortions in the recorded imagery, the Probe-1 is mounted on a 3 axis, gyro-stabilized mount. Geolocation of nadir pixels is assisted by the recording of aircraft GPS positional data and tagging each scan line with a time that is referenced to the UTC time interrupts from the GPS receiver.

The spectral data is processed to identify unique spectra in the image. The captured and processed spectra are compared to a library of known material spectra called "digital fingerprints" and the output allows the identification of mineral, compounds and organic matter and the determination of vegetative conditions.

We are actively seeking funding to engineer and manufacture a third generation probe instrument, which will be capable of analyzing substantially more data inputs, including chemical, light, pressure, vibration, and acceleration. The new design will operate at extremely high speed with excellent resolution. We expect that the combination of substantially improved analysis and higher resolution will open up new markets.

We are currently evaluating hyperspectral imagery collected to date so that we can determine whether this archive of information can be used to locate mineral properties.

Our aircraft was grounded in 2006 for FAA required maintenance and repairs. As a result, our hyperspectral remote sensing operations have ceased until such time that we raise sufficient funding to repair our aircraft or purchase a new aircraft.

Other

Employees

As of March 31, 2009, we had 4 full-time employees and no part time employees.

Available Information

The Securities and Exchange Commission maintains an internet site at http://www.sec.gov that contains reports and financial information filed by us. We maintain an internet site at http://www.earthsearch.com that contains information about our business, markets and technology. Information on our internet site is not incorporated by reference in this report.

Risk Factors That Could Affect Liquidity, Operating Results And Market Price Of Stock

ITEM 1A. RISK FACTORS

Competitive pressures may adversely affect our operating revenues. The Company has numerous competitors in the remote sensing services (airborne hyperspectral services) and natural resource development industries (Oil shale development). These companies are also developing new technology improvements and applications that could adversely affect our operating revenues and in turn, our business and financial condition.

The oil shale industry is currently evolving with many large and small competitors developing processes of their own. The Company may face significant competition from these competitors. Additionally our technology is very early stage and there is no guarantee that it will produce oil in the quantity at the price we anticipate. The Company will need to expend significant capital to develop and commercialize our oil shale technology. The Company may not be able to raise the necessary capital required to move our technology forward due to the current economic environment.

The Company may need to expend significant capital to keep pace with technological developments in the remote sensing industries. The remote sensing industry is constantly undergoing development and change and it is likely that new technology, whether embodied in new equipment or techniques, will be introduced in the future. In order to keep pace with any new developments, the Company is planning to expend significant capital to develop or acquire the next level of developments in new remote sensing equipment and to hire and train employees in the new techniques.

The Company is pursuing financing to develop additional remote sensing instruments; however, we may not be able to raise sufficient funds, and if the Company does so, there is no guaranty that the new instruments will out perform instruments used by our competitors. In addition, the Company’s ability to raise needed capital may be influenced by general economic conditions and the strength of capital markets.

The Company may incur significant expenses to comply with new or more stringent governmental regulation. The sale of our imagery is regulated by the Department of Commerce. Although the Company (through its acquisition of STDC) has acquired a Department of Commerce (DOC) Remote Sensing License that permits the Company to market it’s hyperspectral and panchromatic imagery globally, there is no guarantee that the government will not impose restrictions on sales if the quality of our imagery were to substantially increase. Because our license was the first issued DOC Remote Sensing License, the Company cannot anticipate how the DOC specifically will treat our license or how the airborne remote sensing industry will be regulated in the future.

Risks Related to Our Business

The Company may not realize our anticipated return on capital commitments made to expand our capabilities in both of our focus industries. The company has expended capital in the development of our oil shale extraction technology prototype. If the Company is unable to raise additional capital to complete development of your prototype or testing of the technology does not produce the anticipated results, the company may not generate revenues from this endeavor.

The Company purchased an aircraft and an airborne hyperspectral instrument, as well as oil and gas property rights. The aircraft and airborne hyperspectral instrument were purchased to increase our capacity to conduct airborne surveys. If the Company does not experience continued demand for our remote sensing services, the Company may incur significant expense without generating corresponding revenues. The oil and gas property rights were acquired in order to exploit suspected natural resources located within certain properties. If these properties do not contain sufficient natural resources to warrant exploitation, the Company may incur significant expenses without generating corresponding revenues. There were no prospects for new oil and gas contracts from existing properties in fiscal 2009.

In addition, from time to time, the Company expects to make significant capital expenditures to implement new processes and to increase both efficiency and capacity. Some of these projects may require additional training for our employees and not all projects may be implemented as anticipated. If any of these projects do not achieve the anticipated increase in efficiency or capacity, our returns on these capital expenditures may not be as expected.

Our ability to grow is dependent upon, and may be limited by, among other things, our capital structure, the price of our stock and our existing financing arrangements. If additional funding sources are needed, the Company may not be able to obtain the additional capital necessary to pursue our internal growth and acquisition strategy or, if the Company can obtain additional financing, the additional financing may not be on financial terms that are satisfactory to us.

The Company’s database of spectral information may not be marketable or may not garner a price, which makes processing or analyzing the data economically reasonable. The Company has a substantial archive of Probe 1 hyperspectral imagery that was not gathered under contract with a client. From time to time, the Company continues to gather hyperspectral imagery without having sold the rights to that data. The collection process requires variable as well as fixed expenditures that must be recouped though marketing the collected data. Although we do not carry the value of our existing Probe 1 hyperspectral archives as an asset on our balance sheet, the future success of the Company depends to some extent upon our ability to market this archived data.

Cancellations, reductions or delays in customer orders may adversely affect our results of operations. Our overall operating results are affected by many factors, including the timing of survey contracts from large clients, the timing of capital expenditures to increase our capacity for gathering data in anticipation of future sales of products and services, and the weather which can affect whether or not a customer’s target of interest can be collected at a certain stage of vegetal growth. Although a large portion of our expenses are fixed; a significant portion of our operational expenses vary with the number of airborne surveys. Because several of our subsidiaries are new businesses and have not obtained long-term commitments from our clients, we must anticipate the future demand for our services based upon our discussions with clients. Cancellations, reductions or delays in orders by a client or group of clients could have a material adverse effect on our business, financial condition and results of operations.

The unavailability of skilled personnel may have an adverse effect on our operations. From time to time, the Company or some of our subsidiaries may experience difficulties in attracting and retaining skilled personnel to process and interpret the substantial volume of imagery data that is already collected or is expected to be collected in the future. The Company’s ability to operate successfully could be jeopardized if we are unable to attract and retain a sufficient number of skilled personnel to conduct our business.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None

ITEM 2. PROPERTIES

The Company headquarters consist of approximately 1,500 square feet of office space in Lakeside, Montana.

As a 50% member of ESSI Probe I LC, an Idaho limited liability company (“Probe I LC”), the Company owns 50% of the hyper-spectral instrument owned by Probe I LC. The Company shares its ownership with the two other members of ESSI Probe I LC, Arthur W. McClain Trust and Francisco Elmudesi (the “Woodstock members”). Pursuant to an agreement dated June 3, 1997 (the “Equipment Usage Agreement”), the Company had the right to purchase the hyper-spectral instrument until June 3, 2007 for the purchase price of $2,250,000. The Company continues the process of negotiating an extension to the renewal period.

ITEM 3. LEGAL PROCEEDINGS

On March 23, 2005, we entered into a settlement agreement (2005 Settlement Agreement) with Accuprobe to return an airborne hyperspectral sensor (Probe) and to settle the outstanding obligations under the related capital lease. Under the 2005 Settlement Agreement, we were required to return the Probe on or before August 31, 2005. Due to continuing disputes over various issues, the probe was not returned until 2007. As the Probe was not returned by the August 2005 due date, we were subject to a shipping, handling and disposition fee of $250,000. In addition, we were subject to interest charges that began accruing on September 2, 2005 at an annual rate of prime plus 4%; rent on the probe of $250,000 per year beginning April 10, 2000 with interest on any unpaid rent accruing at a rate of prime plus 2% through August 31, 2005. After August 31, 2005, interest related to the unpaid rent ceased and was replaced with a 5% late fee calculated on the entire balance due at the end of each month.

Because we were unable to reach Accuprobe and make arrangements for the return of the probe, in January 2007, we shipped the probe to an acquaintance of Accuprobe with instructions to hold the probe until Accuprobe provided further instructions. We obtained confirmation in December 2007 that Accuprobe had contacted the acquaintance and instructed them to begin certain repairs and calibrations on the probe. As a result of this confirmation, we discontinued accruing rent, interest and late fees on the probe.

The estimated settlement obligation did not increase as of March 31, 2009 compared to the March 31, 2008 balance.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

P ART II

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON STOCK EQUITY AND RELATED STOCKHOLDER MATTERS

(a)

Principal Market or Markets. The Company's common stock trades on the OTC Bulletin Board under the symbol “ESSE”. The range of reported high and low bid quotations for the Company’s common stock, as set forth below, reflect interdealer bid prices, without retail markups, markdowns, commissions, or adjustments as reported in on the OTCBB and do not represent actual transactions.

Quarter Ended	High	Low

June 30, 2007	.06	.06
September 30, 2007	.07	.06
December 31, 2007	.16	.15
March 31, 2008	.24	.16

June 30, 2008	.09	.04
September 30, 2008	.13	.05
December 31, 2008	.07	.01
March 31, 2009	.02	.00

	(b)	Approximate Number of Holders of Common Stock. The number of record owners of the Company's $.001 par value common stock at March 31, 2009 was approximately 1,257. This does not include shareholders that hold stock in their accounts at brokers/dealers.
	(c)	Dividends. Holders of the Company’s common stock are entitled to receive such dividends as may be declared by the Company's Board of Directors. No dividends have been paid with respect to the Company's common stock and no dividends are anticipated to be paid in the foreseeable future.
	(d)	In the last three years, the Company has made the following sales of unregistered securities, all of which sales were exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) or as otherwise indicated:

Recent Sales of Unregistered Securities

Date	Amount of Securities Sold	Price per Share ($)	Total Cash Proceeds ($)		Date	Amount of Securities Sold	Price per Share ($)	Total Cash Proceeds ($)

3/13/2007	11,400,000	$0.10	$1,140,000	(1)	3/15/2007	250,000	$0.10	$25,000	(1)
3/16/2007	90,750	$0.10	$9,075	(1)	3/28/2007	2,500,000	$0.10	$250,000	(2)
3/31/2007	800,000			(3)	4/18/2007	65,000	$0.40	$26,000	(2)
4/27/2007	265,451	$0.11	$29,350	(1)	6/19/2007	34,386	$0.29	$10,000	(1)
7/18/2007	377,130	$0.22	$82,968	(1)	8/10/2007	98,012	$0.24	$23,523	(1)
9/14/2007	58,824	$0.19	$11,177	(1)	10/16/2007	141,763	$0.11	$15,594	(1)
11/13/2007	500,000	$0.05	$25,000	(4)	11/30/2007	557,143	$0.06	$35,000	(4)
12/17/2007	4,285,714	$0.07	$300,000	(4)	1/18/2008	1,865,000	$0.06	$111,900	(1)
2/13/2008	1,893,387	$0.06	$113,603	(1)	3/1/2008	500,000	$0.05	$25,000	(4)
4/14/2008	1,000,000	$0.06	$62,000	(1)	5/9/2008	392,736	$0.06	$2	(1)
5/9/2008	1,694,418	$0.08	$128,868	(6)	5/12/2008	14,472	$0.08	$1,101	(6)
5/12/2008	582,770	$0.05	$29,131	(1)	6/10/2008	3,000,000	$0.03	$95,000	(4)
6/11/2008	5,000,000	$0.05	$250,000	(4)	6/19/2008	2,841,667	$0.06	$170,500	(1)
7/7/2008	7,500,000	$0.04	$300,000	(4)	7/7/2008	2,000,000	$0.06	$120,000	(1)
7/14/2008	368,228	$0.08	$27,617	(1)	7/14/2008	1,250,000	$0.04	$50,000	(4)
7/22/2008	350,877	$0.05	$17,544	(6)	7/22/2008	400,001	$0.06	$24,800	(6)
7/29/2008	6,779,999	$0.08	$508,500	(4)	8/8/2008	625,000	$0.09	$56,250	(1)
8/8/2008	1,200,000	$0.05	$60,000	(4)	8/15/2008	34,753,788	$0.09	$3,127,841	(5)
9/26/2008	229,906	$0.06	$14,254	(6)	9/26/2008	2,463,672	$0.07	$172,457	(1)
10/6/2008	1,397,773	$0.06	$83,866	(1)	11/5/2008	2,608,844	$0.03	$78,265	(1)
12/10/2008	2,160,087	$0.02	$45,362	(1)	12/10/20088	312,504	$0.06	$19,375	(6)
12/10/2008	759,230	$0.05	$34,925	(6)	2/10/2009	6,000,000	$0.01	$72,000	(1)

(1) Consideration paid for the shares was employee and/or consulting services.

(2) Shares issued for debt consideration.

(3) Consideration paid for Directorship.

(4) Consideration received in a private placement.

(5) Shares issued in connection with the acquisition of assets from the shareholders of General Synfuels International.

(6) Shares issued for stock payable.

Securities authorized for issuance under Equity Compensation Plans

The following table sets forth certain information on the Company’s Equity Compensation Plans as of March 31, 2009 See Note 10 to the Notes to Consolidated Financial Statements for additional information on equity compensation including material terms of options granted that have not been approved by security holders.

	Number of securities to be issued upon exercise of outstanding options, warrants and rights	Weighted-average exercise price of outstanding options, warrants and rights	Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Plan category	(a)	(b)	(c)
Equity compensation plans approved by security holders	-	-	-

Equity compensation plans not approved by security holders	-	-	14,076,743

Total	-	-	14,076,743

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

The following discussion should be read in conjunction with other sections of this Form 10-KSB including Part 1, “Item 1: Business” and Part II, “Item 7: Financial Statements.” Various sections of management’s discussion and analysis (“MD&A”) contain statements that are forward-looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially due to factors discussed in this report, as well as factors not within our control. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations.

Our MD&A is provided as a supplement to our audited financial statements to help provide an understanding of our financial condition, changes in financial condition and results of operations.

Results of Operations

Our aircraft was grounded in 2006 for required FAA repairs and maintenance and remained grounded through the issuance of this report. As a result, we have not generated any revenue from our Hyperspectral remote sensing in fiscal year 2009 and 2008.

General and administrative costs were $7,737,533 in fiscal year 2009 compared with $1,454,008 in 2008. This increase was primarily due to the acquisition of all of the outstanding shares of General Synfuels International, Inc. (GSI) an entity controlled by certain management and directors of ESSI. This transaction was accounted for as an asset purchase due to the fact GSI was dormant. The $5,494,700 value in excess of the historical cost of the asset was recorded as compensation expense.

Interest expense was $654,867 in fiscal year 2009 compared to $520,850 in 2008. Our interest expense primarily consists of interest from our notes payable and related party debt.

Late fees related to settlement agreement were zero in fiscal year 2009 compared to $3,043,230 in fiscal year 2008. On March 23, 2005, we entered into a settlement agreement (2005 Settlement Agreement) with Accuprobe to return an airborne hyperspectral sensor (Probe) and to settle the outstanding obligations under the related capital lease. Under the 2005 Settlement Agreement, we were required to return the Probe on or before August 31, 2005. Due to continuing disputes over various issues, the probe was not returned until 2007. As the Probe was not returned by the August 2005 due date, we were subject to a shipping, handling and disposition fee of $250,000. In addition, we were subject to interest charges that began accruing on September 2, 2005 at an annual rate of prime plus 4%; rent on the probe of $250,000 per year beginning April 10, 2000 with interest on any unpaid rent accruing at a rate of prime plus 2% through August 31, 2005. After August 31, 2005, interest related to the unpaid rent ceased and was replaced with a 5% late fee calculated on the entire balance due at the end of each month.

The estimated settlement obligation did not increase as of March 31, 2009 compared to the March 31, 2008 balance. ESSI continues to work for a resolution to this obligation.

We recognized a net loss of $8,496,248 in fiscal year 2009 compared with a net loss of $5,106,887 in 2008. This significant change in income was due primarily to the acquisition cost of $5,494,700 for GSI in fiscal 2009, discussed in Liquidity and Capital Resources.

Liquidity and Capital Resources

At March 31, 2009, we had $70,618 of cash and cash equivalents and a working capital deficit of $18,570,363. During fiscal year 2009, we used $832,476 in operating activities, resulting primarily from payments for salaries, services. Net cash used in operating activities was $452,202 in 2008

On August 15th of 2008 ESSI acquired all of the outstanding shares of General Synfuels International, Inc. (GSI), an entity controlled by certain management and directors of ESSI. This transaction was accounted for as an asset purchase due to the fact that GSI was dormant, did not have customers or employees and only held certain proprietary rights, patent, technology and construction plans for a gasification process to recover the oil and gas from oil shale. In addition, the asset was recorded at its historical cost due to the fact that this transaction was between entities under common control. Prior to the acquisition, both entities were controlled by certain members of management, who were also shareholders and/or Directors. The $5,494,700 value in excess of the historical cost of the asset was recorded as compensation expense.

ESSI paid the individual GSI Shareholders $5,500,000: 33,333,333 shares of common stock valued at $3,000,000 based on the closing price of ESSI’s stock on the date of the transaction; and $2,500,000 in the form of promissory notes payable to the GSI shareholders in five equal payments of $500,000. ESSI is currently negotiating a restructuring of terms. At ESSI’s election, each promissory note payable can be converted into ESSI common stock at a 40% discount to the average trading price of ESSI common stock 5 days prior to the emission of payment. Because this transaction was between related parties, the patent asset was recorded at its historical cost of $5,300 and the remaining value of $5,494,700 was recorded as compensation expense for the period ended September 30, 2008, as the shareholders didn’t contribute any additional assets, tangible or intangible of value.

In addition, ESSI evaluated the conversion option of the promissory note under SFAS No. 133 and EITF 00-19 and determined that the feature does not have characteristics of a liability because the conversion is not at the note holder’s option.

Net cash used by investing activities was $770,000 in 2009 as compared to $0 in 2008, the increase in cash used in investing is primarily due to deposit related to our oil shale recovery prototype .

Net cash provided by financing activities was $1,664,273 in 2009 as compared to $437,841 in 2008 with the increase due to increased cash from sales of our common stock totaling $1,363,500 as well as proceeds from convertible notes of $390,000.

We do not intend to pay cash dividends to the holders of its common stock and intends to retain future earnings to finance the expansion and development of its business.

As shown in the accompanying financial statements, we incurred losses from operations of $7,841,381 and $4,601,086 for the years ended March 31, 2009 and 2008, respectively and we have an accumulated deficit of $71,838,024 and negative working capital of $18,570,363 as of March 31, 2009. These conditions raise substantial doubt as to our ability to continue as a going concern. Management is trying to raise additional capital through sales of stock. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

There can be no assurance that additional capital beyond the amounts currently forecasted will be required or that any such required additional capital will be available on reasonable terms, at such time or times as required by the Company.

Critical Accounting Policies

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. We evaluate long-lived assets to determine potential impairment by comparing the carrying amount to the undiscounted estimated future cash flows of the related assets.

We issue stock as compensation to employees and outside consultants for services provided to the company. Employee share-based awards are accounted for in accordance with SFAS 123(R), which requires us to measure the cost of employee services received based on the grant-date fair value of the award. We account for non-employee share-based awards in accordance with EITF No. 96-18, “Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquisition, or in Conjunction with Selling, Goods or Services.”

Off Balance Sheet Arrangements

None.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO FINANCIAL STATEMENTS

Report of Registered Independent Public Accounting Firm	F-2

Consolidated Balance Sheets as of March 31, 2009	F-3

Consolidated Statements of Operations for the years ended March 31, 2009 and 2008	F-4

Consolidated Statement of Changes in Stockholders’ Deficit for the years ended March 31, 2009 and 2008	F-5

Consolidated Statements of Cash Flows for the years ended March 31, 2009 and 2008	F-6

Notes to consolidated financial statements	F-7 – F-12

F - 1

Report of Independent Registered Public Accounting Firm

To the Board of Directors

Earth Search Sciences, Inc.

Lakeside, Montana

We have audited the accompanying consolidated balance sheets of Earth Search Sciences, Inc. as of March 31, 2009 and 2008, and the related consolidated statements of operations, stockholders' deficit, and cash flows for each of the years then ended. These financial statements are the responsibility of Earth Search's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Earth Search Sciences Inc. as of March 31, 2009 and 2008, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that Earth Search will continue as a going concern. Earth Search incurred losses from operations for fiscal 2009 and 2008 and has a working capital deficit as of March 31, 2009. These factors raise substantial doubt about Earth Search's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Malone & Bailey, PC

Houston, Texas

www.malone-bailey.com

June 26, 2009

F - 2

EARTH SEARCH SCIENCES, INC.

CONSOLIDATED BALANCE SHEETS

	March 31,
		2009		2008
ASSETS
Current assets:
Cash	$	70,618	$	8,821
Prepaid expenses		13,448		-
Loan costs, net of accumulated amortization of $258,003 and $229,987, respectively		17,567		45,583
Total current assets		101,633		54,404

Property and equipment, net accumulated depreciation of $1,040,180 and $936,332 respectively		102,247		206,096
Intangible asset – patents		25,300		-
Deposits		914,516		-
TOTAL ASSETS	$	1,143,696	$	260,500

LIABILITIES
Current liabilities:
Accounts payable	$	1,513,631	$	1,345,174
Accounts payable – related parties		389,968		381,456
Accrued expenses		3,395,875		2,902,027
Current portion of notes payable		2,128,440		1,092,126
Settlement obligation		8,686,824		8,686,824
Current portion of notes payable – related parties		2,557,258		1,792,799
Total current liabilities		18,671,996		16,200,406

Long term portion of notes payable		500,000		-
Long term portion of notes payable – related party		500,000		-
Total liabilities	$	19,671,996	$	16,200,406

Commitments and contingencies		-		-

STOCKHOLDERS’ DEFICIT
Preferred stock, 300,000,000 shares authorized, none issued and outstanding		-		-
Common stock, $.001 par value; 300,000,000 shares authorized;194,655,705 and 106,969,733 shares issued and outstanding, respectively		194,654		106,970
Additional paid-in capital		53,315,070		47,494,900
Treasury stock		(200,000)		(200,000)
Accumulated deficit		(71,838,024)		(63,341,776)
Total stockholders’ deficit		(18,528,300)		(15,939,906)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	1,143,696	$	260,500

See accompanying summary of accounting policies and notes to financial statements.

F - 3

EARTH SEARCH SCIENCES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

	Years Ended March 31,
	2009		2008
Operating expenses
Late fees related to settlement agreement		-		3,043,230
Depreciation and amortization		103,848		103,848
General and administrative		7,737,533		1,454,008

Total expenses		7,841,381		4,601,086

Loss from operations		(7,841,381)		(4,601,086)

Other income (expense)
Gain on settlement of debt		-		15,049
Interest expense		(654,867)		(520,850)

Net Loss	$	(8,496,248)	$	(5,106,887)

Basic and diluted:
Loss per share	$	(0.05)	$	(0.05)
Weighted average common shares outstanding		161,287,904		99,689,137

See accompanying summary of accounting policies and notes to financial statements.

F - 4

EARTH SEARCH SCIENCES, INC.

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

Years Ended March 31, 2009 and 2008

	Common Shares	Stock Amount		Additional Paid-in Capital		Treasury Stock			Subscription Receivable		Accumulated Deficit			Total
Balances at March 31, 2007	96,327,473	$	96,328	$	46,577,053	$	(200,000	)	$	(250,000)	$	(58,234,889	)	$	(12,011,508)

Payment of subscription receivable										250,000					250,000

Issuance of common stock for debt	65,000		65		25,935										26,000

Issuance of common stock for services	4,734,403		4,734		467,528										472,262

Issuance of common stock for cash	5,842,857		5,843		379,158										385,001

Imputed interest					45,226										45,226

Net loss												(5,106,887	)		(5,106,887)

Balances at March 31, 2008	106,969,733	$	106,970	$	47,494,900	$	(200,000	)	$		$	(63,341,776	)	$	(15,939,906)

Issuance of common stock payable	1,708,890		1,708		128,261										129,969

Issuance of common stock for services	25,913,750		25,914		1,153,844										1,179,758

Issuance of common stock for cash	26,729,999		26,729		1,336,771										1,363,500

Issuance of common stock for GSI	33,333,333		33,333		2,966,667										3,000,000

Imputed interest					234,627										234,627

Net loss										-		(8,496,248	)		(8,496,248)

Balances at March 31, 2009	194,655,705	$	194,654	$	53,315,070	$	(200,000	)	$	-	$	(71,838,024	)	$	(18,528,300)

See accompanying summary of accounting policies and notes to financial statements.

F - 5

EARTH SEARCH SCIENCES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended March 31, 2009 and 2008

		2009		2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(8,496,248)	$	(5,106,887)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization		103,848		103,848
Amortization of deferred finance costs		28,016		29,989
Imputed interest		234,627		45,226
Gain on settlement of debt		-		(15,049)
Common stock issued for services		1,179,758		472,262
Common stock issued for services related to the purchase of asset – General Synfuels Int.		2,994,700		-
Payable issued for services related to the purchase of asset – General Synfuels Int.		2,500,000		-

Changes in assets and liabilities:
Accrued interest – related party		118,584		217,217
Accounts payable and accrued expenses		511,231		542,153
Accounts payable – related party		8,512		6,342
Prepaid and other current assets		(15,504)		132
Accrued settlement liability		-		3,252,565
NET CASH USED IN OPERATING ACTIVITIES		(832,476)		(452,202)

CASH FLOWS FROM INVESTING ACTIVITIES
Patent costs		(20,000)		-
Cash paid for prototype		(750,000)		-
NET CASH USED IN INVESTING ACTIVITIES		(770,000)		-

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from stockholder loans		103,000		341,500
Payment on stockholder loans		(88,541)		(377,000)
Proceeds from subscription receivable		-		250,000
Financing costs		-		(47,347)
Proceeds from issuance of common stock		1,363,500		385,000
Proceeds from issuance of convertible notes		390,000		-
Payment on short-term debt		(103,686)		-
Payment on long-term debt		-		(114,312)
NET CASH PROVIDED BY FINANCING ACTIVITIES		1,664,273		437,841

NET DECREASE IN CASH		61,797		(14,361)
CASH AT BEGINNING OF PERIOD		8,821		23,182
CASH AT END OF PERIOD	$	70,618	$	8,821

SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	215,157	$	68,481
Taxes paid		-		-

Non-cash financing and investing activities:
Common stock issued for debt repayment	$	-	$	26,000
Common stock for GSI – non compensation piece		5,300
Capitalized prototype cost in accounts payable	$	162,460		-
Stock issued for vendor payable	$	129,969

See accompanying summary of accounting policies and notes to financial statements.

F - 6

EARTH SEARCH SCIENCES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES

Earth Search Sciences, Inc. (“ESSI”) ceased all operations in the year ended March 31, 2007.

We have five wholly-owned subsidiaries: Skywatch Exploration, Inc., Polyspectrum Imaging, Inc., Geoprobe, Inc., STDC, Inc., and General Synfuels International. In addition, there are five majority-owned consolidated subsidiaries: Earth Search Resources, Inc., Eco Probe, Inc., ESSI Probe 1 LC, Petro Probe, Inc. and Terranet, Inc. All of these subsidiaries except General Synfuels International are inactive.

We did not generate any revenue during fiscal year 2009 and 2008, and have no current business operations.

RECLASSIFICATION

Certain prior year amounts have been reclassified to conform with the current year presentation.

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

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

CASH AND CASH EQUIVALENTS

We consider all highly liquid investments with a maturity of three months or less at the time of purchase to be cash equivalents.

FAIR MARKET VALUE OF FINANCIAL INSTRUMENTS

The estimated fair value of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other liabilities approximate their carrying amounts in the financial statements.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated depreciation. Depreciation on our property and equipment is recognized using the straight-line method over estimated useful lives ranging from five years for computers and software, vehicles and equipment to ten years for the Airplane and hyperspectral sensors.

The airplane is the only remaining asset with a net book value. It is not in a useable condition and is carried at the estimated value if it were to be sold.

IMPAIRMENT OF LONG-LIVED ASSETS

INCOME TAXES

We recognize deferred tax assets and liabilities based on differences between the financial reporting and tax bases of assets and liabilities using the enacted tax rates and laws that are expected to be in effect when the differences are expected to be recovered. We provide a valuation allowance for deferred tax assets for which it does not consider realization of such assets to be more likely than not.

NET LOSS PER COMMON SHARE

Net loss per common share has been computed based on the weighted average number of common shares outstanding. Common stock equivalents have not been considered in the diluted net loss per share calculation because their effect on net loss per share is anti-dilutive.

STOCK-BASED COMPENSATION

For the years ended March 31, 2009 and 2008, ESSI had no stock option issuances.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

We do not expect the adoption of any recently issued accounting pronouncements to have a significant impact on its financial position, results of operations or cash flows.

NOTE 2 - GOING CONCERN

NOTE 3 - PROPERTY AND EQUIPMENT

Property and equipment consists of the following at March 31, 2009:

	Life	Amount
Aircraft	10 years	$	925,795
Equipment	5 years		216,357
			1,142,152
Less: accumulated depreciation			(1,039,905)
Property and equipment, net		$	102,247

Our aircraft has been grounded since 2006 due to required FAA repairs and upgrades. The total repairs required to make the aircraft flight ready is estimated at $530,000. We expect to complete the repairs as our cash flows permit.

Depreciation expense totaled $103,848 in both fiscal 2009 and 2008.

NOTE 4 – ACQUISITION OF ASSET FROM ENTITY UNDER COMMON CONTROL

On August 15th of 2008 ESSI acquired all of the outstanding shares of General Synfuels International, Inc. (GSI), an entity controlled by certain management and directors of ESSI. This transaction was account for as an asset purchase due to the fact that GSI was dormant, did not have customers or employees and only held certain proprietary rights, patent, technology and construction plans for a gasification process to recover the oil and gas from oil shale. In addition, the asset was recorded at its historical cost due to the fact that this transaction was between entities under common control. Prior to the acquisition, both entities were controlled by certain members of management who were also stockholders and or Directors. The $5,494,700 value in excess of the historical cost of the asset was recorded as compensation expense.

ESSI paid the individual GSI Shareholders $5,500,000: 33,333,333 shares of common stock valued at $3,000,000 based on the closing price of ESSI’s stock on the date of the transaction; and $2,500,000 in the form of promissory notes payable to the GSI shareholders in five equal payments of $500,000, commencing on the first business day of February 2009, and continuing on the first business day of each sixth calendar month thereafter until paid. These notes are currently in default and ESSI is negotiating a restructuring of the notes which may entail a swap for preferred equity. At ESSI’s election, each promissory note payable can be converted into ESSI common stock at a 40% discount to the average trading price of ESSI common stock 5 days prior to the emission of payment. Because this transaction was between related parties, the patent asset was recorded at its historical cost of $5,300 and the remaining value of $5,494,700 was recorded as compensation expense for the period ended December 31, 2008, as the shareholders didn’t contribute any additional assets, tangible or intangible of value.

On August 15, 2008, ESSI entered into three Consulting Agreements (the “Consulting Agreement”) with each of the GSI Shareholders, Ken Danchuk, Larry Vance, and Ron McQueen.

Under the terms of the Mr. Danchuk’s Consulting Agreement, performed services for a period of six months and received a fee of $125,000, $50,000 of which was paid upon the execution of the agreement. The remaining $75,000 was paid in the form of a note payable, which during the quarter ending March 31, 2009 the payment schedule was restructured to provide for a stock payment valued at issuance of $12,000 and two cash payments of $12,500 each. The equity payment was paid in February, 2009 and one cash payment was made during February, 2009. The remaining cash payment of $12,500 was due on April 15, 2009 and was paid on that date. Mr. Danchuk advised ESSI on the corporate requirements structure of GSI so as to integrate GSI into a successful ESSI subsidiary company as well as the selection and implementation of a new internet website and corporate communication system. Mr. Danchuk also assisted ESSI in the analysis, planning and production of corporate executive planning documents.

Pursuant to the terms of the Consulting Agreement, Mr. Vance was to be paid $250,000 on December 31, 2008. ESSI negotiated a stock payment valued at issuance of $60,000 as payment of this agreement. Mr. Vance advised ESSI in a variety of areas, such as; the direction and strategy for successful mineral and hydrocarbon exploration and exploitation, implementation of the oil shale gasification technology, selection and preparation of superior oil and shale land sites, and the highest and best use of the hyperspectral remote sensing technology. Mr. Vance will also act in an executive managerial capacity as required and hold the position of chairman of the technical Advisory Board for ESSI.

In August 2008, ESSI entered into a one year consulting agreement with Ron McQueen to provide advice to ESSI in technical areas such as construction and installation of the oil shale gasification technology. In consideration for services rendered, Mr. McQueen received 1,420,455 shares of our common stock valued at $127,841, which represents that market value on the date of grant. These shares were issued effective as of the agreement date therefore we recorded expense of $127,841 during the second quarter.

NOTE 5 - Debt

Notes payable consists of the following:

		2009		2008
Installment note payable, currently in default, secured by our assets, with interest at 15%	$	687,533	$	747,656

Installment note payable, currently in default, with interest at 15%		298,907		342,470

GSI acquisition installment note payable, currently in default (see Note 4)		2,500,000		-

Convertible promissory notes, issued by GSI, with interest at 10%		479,000		-

Other		2,000		2,000

Total	$	3,967,440	$	1,092,126

As of March 31, 2009 ESSI had two outstanding installment notes with a 15% interest rate both currently in default. An extension of payment terms are currently being negotiated for both loans.

As of March 31, 209 ESSI had $2,500,000 outstanding in the form of promissory notes payable to the GSI shareholders in five equal payments of $500,000, commencing on the first business day of February 2009, and continuing on the first business day of each sixth calendar month thereafter until paid. These notes are currently in default and ESSI is negotiating a restructuring of the notes which may entail a swap for preferred equity. At ESSI’s election, each promissory note payable can be converted into ESSI common stock at a 40% discount to the average trading price of ESSI common stock 5 days prior to the emission of payment.

As of March 31, 2009 our subsidiary General Synfuels International issued 10% convertible promissory notes in the amount of $479,000 of which $89,000 is due to the company from CEO Luis Lugo. These one year notes carry an automatic conversion into equity of GSI equity, at a price equal to 70% of the purchase price per share paid by equity investors, upon an equity financing in GSI of at least $3,000,000. If GSI is sold before conversion occurs an amount of 1.5 times the principal amount becomes due and payable.

We evaluated the conversion option of the promissory note under SFAS No. 133 and EITF 00-19. Contracts that are indexed in and potential settled in the stock of a subsidiary is excluded from the scope of EITF 00-12. Further, EITF 99-01 clarifies that debt convertible into a stock of a consolidated subsidiary should be accounted for in accordance with APB 14 since such instrument is not subject to SFAS No. 133. APB14 states that no portion of the proceeds should be accounted for as attributable to the conversion feature. Therefore, these instruments are not considered to be a derivative nor contain a beneficial conversion feature.

For the year ending March 31, 2009 and 2008, we recorded interest expense of $654,867 and $520,850, respectively.

NOTE 6 – RELATED PARTIES

We have financed our operations in part by funds received from shareholders. These advances are in the form of unsecured promissory notes and bear interest at rates ranging from 8% to 10%. Stockholder loans totaled $1,718,258 and $1,792,799 and accrued interest of $831,342 and $712,758 for 2009 and 2008, respectively.

NOTE 7 - ACCRUED OFFICERS' COMPENSATION

Accrued compensation consists of the cumulative unpaid compensation due to four corporate officers (Chairman, Chief Executive Officer, Chief Financial Officer and Secretary). We recorded officer compensation of $572,083 and $240,000 during fiscal 2009 and 2008, respectively, and included these amounts in general and administrative expenses. Accrued officers’ compensation, including accrued interest and taxes, totaled $1,824,235 and $1,377,486 for 2009 and 2008 respectively and is included in accrued expenses.

NOTE 8 - INCOME TAXES

ESSI recorded no provision for income taxes in fiscal 2009 and 2008 due to the operating losses incurred from inception to date.

The tax effect of temporary differences between financial reporting and the tax bases of assets and liabilities relate to the following:

At March 31, 2009, deferred tax assets consisted of the following:

Deferred tax assets:
Net operating losses	$	9,064,882
Less: valuation allowance		(9,064,882)
Net deferred tax asset	$	-

The cumulative net operating loss carry-forward is approximately $26,661,419 at March 31, 2009, and will expire in the years 2016 through 2029. The deferred tax asset has been fully reserved because we are unable to anticipate future taxable income to realize the potential benefits of the gross deferred tax asset.

The annual amount of tax loss carryforward, which can be utilized, may be limited due to the substantial changes in the company's ownership as defined by section 382 of the Internal Revenue Code, which may occur in the future. Such limitations could result in the expiration of a part or all of the loss carryforwards before their utilization.

NOTE 9 - STOCK OPTIONS

For fiscal 2009 and 2008, there were no options granted. During fiscal 2008, all of the options exercisable as of March 31, 2007 expired leaving no stock options outstanding and exercisable as of March 31, 2009.

The following table summarizes the employee stock option transactions described above:

	Shares under Option			Weighted-average exercise price
Balance, March 31, 2007		28,125		$	1.31
Options granted		-
Options expired		(28,125	)		(1.31	)
Options exercised		-			-
Balance, March 31, 2008		-		$	-

NOTE 10 – STOCK TRANSACTIONS

COMMON STOCK:

During fiscal 2008, we issued:

	·	4,734,403 shares of stock for services valued at $472,262 using the grant-date quoted price of the stock. The 4,734,403 shares vest immediately and therefore $472,262 was expensed during the period.
	·	65,000 shares of stock for debt valued at $26,000 using the grant-date quoted price of the stock.
	·	5,842,857 shares of stock for cash of $385,001.

During fiscal 2009, we issued:

	·	25,913,750 shares of stock for services valued at $1,179,758 using the grant-date quoted price of the stock. 22,072,083 shares vest immediately and therefore $947,258 was expensed during the period.
	·	26,729,999 shares of stock for cash of $1,363,500.

	·	1,708,890 shares of stock valued at $129,969 for s stock payable pursuant to a consulting agreement.
	·	33,333,333 shares of stock valued at $3,000,000 in connection with the acquisition of assets from the shareholders of General Synfuels International.

Stock Payable

In September 2007, we retained a consultant to provide accounting and reporting advice and oversight through a one year consulting agreement which was not renewed. In consideration for services rendered, the consultant received shares of our common stock valued at $20,000 per month based on the average closing price of ESSI’s common stock on the five trading days proceeding each month. As of March 31, 2008, the consultant earned 1,708,889 shares of common stock valued at $129,969. We are accounting for this service arrangement in accordance with EITF No. 96-18, which requires us to recognize the fair value of the services using a measurement date that is the earlier of the performance commitment date or the date in which the services are completed. We determined that the services under this arrangement are completed at the end of each quarter and therefore the measurement date is the last day of each quarter. Shares earned during each quarter are valued using the quoted share price on the last day of each quarter. We recognize the expense as the services are performed and accrue a liability until the shares are actually issued. As of March 31, 2009 there was no liability accrued.

NOTE 11 – SETTLEMENT AGREEMENT

On March 23, 2005, we entered into a settlement agreement with Accuprobe to return an airborne hyperspectral sensor (Probe) and to settle the outstanding obligations under the related capital lease. Under this agreement, we were required to return the Probe on or before August 31, 2005. Due to continuing disputes over various issues, the probe was not returned until 2007. As the Probe was not returned by the August 2005 due date, we were subject to a shipping, handling and disposition fee of $250,000. In addition, we were subject to interest charges that began accruing on September 2, 2005 at an annual rate of prime plus 4%; rent on the probe of $250,000 per year beginning April 10, 2000 with interest on any unpaid rent accruing at a rate of prime plus 2% through August 31, 2005. After August 31, 2005, interest related to the unpaid rent ceased and was replaced with a 5% late fee calculated on the entire balance due at the end of each month.

The estimated settlement obligation as of March 31, 2009 was $8,686,824.

NOTE 12 – GAIN ON SETTLEMENT OF DEBT

In March 2007, we recorded a $10,132,522 net gain on the settlement of certain debt incurred in connection with a U.S. Government project called Naval Earth Map Observer (NEMO). This agreement was originated on January 21, 1999, however, the NEMO project was subsequently cancelled and all work on the project ceased. At that time, ESSI, through its subsidiary Space Technology Development Corporation (STDC), recorded liabilities associated with the subcontract agreements totaling $10,132,522. As of March 31, 2007, no significant claims had been filed against ESSI, STDC or any ESSI subsidiaries related to the NEMO contract. STDC ceased performance in November 2000, so any breach of contract would have occurred over six years ago. Action against ESSI, STDC or any ESSI subsidiary would be barred by the applicable statute of limitations under federal law and the laws of California, Virginia, Maryland and Delaware. Accordingly, we recognized the gain pursuant to SFAS 140.

In April 2007, we recorded a $15,049 net gain on the settlement of certain debt owed to a vendor. We executed a settlement with them to issue 65,000 shares of our common stock valued at $26,000, using the quoted price of our common stock on the grant date, for settlement of $41,049 in outstanding debt.

NOTE 13 – DEPOSITS

During fiscal year 2009, we recorded $914,516 in deposits related to the development of a prototype related to the oil shale gasification process acquired through GSI. Of this amount, $750,000 was paid during the year, with the balance of $162,460 recorded as accounts payable, which represent a legel liability for work performed related to the prototype.

NOTE 14 - SUBSEQUENT EVENTS

In May 2009, our subsidiary General Synfuels International issued 10% convertible promissory notes in the amount of $250,000.

F - 12

ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.(T) CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, principally our chief financial officer and chief executive officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our management concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i.) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure. In particular, we have identified the following material weakness of our internal controls:

	-	There is an over-reliance upon independent financial reporting consultants for review of critical accounting areas and disclosures and material non-standard transactions.
	-	There is a lack of sufficient accounting staff which results in a lack of segregation of duties necessary for a good system of internal control.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended) for the company.

In order to ensure whether our internal control over financial reporting is effective, management has assessed such controls for its financial reporting as of March 31, 2009. This assessment was based on criteria for effective internal control over financial reporting described in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

In performing this assessment, management has identified the following material weaknesses:

There is an absence of adequate segregation of duties relating to oversight and management of our systems. This resulted primarily from the fact that certain parts of the work of our chief financial officer are not monitored or reviewed. The absence of adequate segregation of duties may have an effect on the systems which we use in the evaluating and processing of certain accounts and areas and in the posting and recording of journal entries into certain accounts, as described below:

Financial statements closing process – There was a material weakness in the process of closing and consolidating our financial statements which resulted from the fact that the work of processing the trial balance, evaluating and implementing accounting policies and practices, and drafting the consolidated financial statements and related footnotes is performed by consultants and not reviewed by qualified accountant within our company.

As a result of these material weaknesses in our internal control over financial reporting, our management concluded that our internal control over financial reporting as of March 31, 2009, was not effective based on the criteria set forth by COSO in Internal Control – Integrated Framework. A material weakness in internal control over financial reporting is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

Management’s Plan for Remediation of Material Weaknesses

Based on our financial condition, there are limitations to the level of remediation possible. If we restart our operations, management will implement the following plan intended to remediate our ineffectiveness and to strengthen our internal controls over financial reporting:

	o	Hire a qualified accounting staff to manage, review and verify the day-to-day accounting and the financial statement close process.
	o	Improving the control and oversight of the duties relating to the systems we use in the evaluation and processing of certain accounts and areas in the posting and recording of journal entries into certain accounts. This improvement should include reviews by management of the accounting processes as well as a reorganization of some of the accounting functions.

The segregation of duties relating to the processing of accounts and the recording of journal entries into certain accounts.

This annual report does not include an attestation report of our public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSON AND CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Section 16(a) of the Securities Exchange Act of 1934 requires our officers, directors and persons who own more than 10% of a registered class of our equity securities to file reports of ownership and changes in ownership with the SEC and Nasdaq. Officers, directors, and greater than 10% beneficial owners are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file. Based solely on our review of copies of the Section 16(a) reports filed for the fiscal year ended March 31, 2008, we believe that all filing requirements applicable to its officers, directors, and greater than 10% beneficial owners were complied with.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

The following table sets forth certain information with respect to the executive officers of the Company for fiscal 2008 to the present.

Name	Age	Position

Larry F. Vance	74	Chairman

Luis Lugo	40	Chief Executive Officer

Charles Bridge	42	Chief Financial Officer

Tami J Story	46	Director Secretary/Treasurer/Director

	(1)	Effective July, 2008, Mr. Lugo was appointed as Chief Executive Officer of the Company.
	(2)	Effective September, 2008, Mr. Bridge was appointed as Chief Financial Officer of the Company.
	(3)	Effective April, 1993, Ms. Story was appointed as Secretary and Treasurer of the Company.

Certain additional information concerning the individuals named above is set forth below. This information is based on information furnished to us by each individual noted.

Larry F. Vance served as Chief Executive Officer of the Company from April 1985 to July 2008. Since April 8, 1995, Mr. Vance has served as Chairman of the Company. Mr. Vance is also a director of the Company and has been a full-time employee of the Company since 1985. Mr. Vance’s training is in business and marketing. He served in a management capacity for the 3M companies, IBM, and Computer Usage Corporation prior to founding the Company.

Luis Lugo served as Chief Executive Officer of the company since July 2008. Mr. Lugo brings substantial experience in oil, gas and other process industries. He previously served as Director of Finance and Strategy for 3AG Distribution (Elf Aquitaine Oil Lubricants Venezuela) and was involved in securing capital investment and in developing the distribution system which helped the company achieve six percent of the Venezuelan lubricants market in its first three years of operations. Mr. Lugo also served as Engagement Manager of global chemicals and strategy practices for Arthur D. Little Management Consulting and as Strategy Analyst for BP Amoco where he developed analytical and financial modeling and valuation of acquisition targets for Latin America, Europe and East Asia. Mr. Lugo holds an MBA in International Business Finance and an MA in International Economics from The George Washington University in Washington D.C

Charles G. Bridge has served as Chief Financial Officer since September 1, 2008. Mr. Bridge brings a wealth of experience connecting investors with viable corporate partners, raising capital for corporate entities, and managing financial and corporate accounting, SEC and NASD reporting, human resources, and corporate risk matters. Mr. Bridge has held CFO positions in the investment and venture capital fields since 1997. Mr. Bridge most recently served as Managing Director and Chief Financial Officer with Brooke Private Equity Advisors in Boston where he helped grow the firm to $800 million in assets under management. Prior to that, he served as CFO for Boston Capital Ventures. Mr. Bridge was also CFO for Capital Resource Advisors/Wellesley Group, Inc. Mr. Bridge holds an M.B.A. from Northeastern University and a B.S. from the University of Maine.

Tami J. Story, Secretary, Treasurer and Director. Tami J. Story served in an administrative support capacity for the Company from 1991 until April 1993. Since April 1993, Ms. Story has served as Secretary and Treasurer of the Company. Ms. Story also serves as a director of the Company. Ms. Story holds a degree with a major in Nursing and a minor in Business Administration.

Family Relationships

There are no family relationships between or among the directors, executive officers or persons nominated or charged by us to become directors or executive officers.

Involvement In Legal Proceedings

To the best of our knowledge, during the past five years, none of the following occurred with respect to a present or former director or executive officer of the Company: (1) any bankruptcy petition filed by or against such person or any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of any competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.

Code of Ethics

The Company has adopted a code of ethics. The Company will provide to any person without charge, upon request, a copy of its code of ethics upon written request to our corporate headquarters or request emailed to earthsrch@aol.com.

Board of Directors Meetings and Subcommittees

Meetings

Our Board of Directors held several meetings during the fiscal year ended March 31, 2009. All board actions were completed through unanimous written consents.

Audit Committee and Financial Expert

Our Board of Directors does not have a separate audit committee. The Board has determined that it does not have a member of its Board that qualifies as an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-B.

To strengthen our controls, during a portion of fiscal year 2009 retained the services of an outside consultant, HF Services LLC to assist with quarterly and annual reviews of our accounting data.

Compensation Committee

As all our executive officers are currently under employment agreements, we do not have a separate compensation committee. At this point, we do not intend to establish a separate compensation committee as this function will be performed by our full Board of Directors.

Nominating Committee

We do not currently have a separate nominating committee as this function is performed by our full Board of Directors.

Shareholder Communication

We communicate regularly with shareholders through press releases, as well as annual and quarterly reports. Our Chief Executive Officer addresses investor concerns on an on-going basis.

Interested parties, including shareholders and other security holders, may communicate directly with our Board of Directors or with individual directors by writing to our Chief Executive Officer at 306 Stoner Loop Road, #6, Lakeside, Montana 59922.

Securities Authorized for Issuance under Equity Compensation Plans

For information regarding securities authorized for issuance under Equity Compensation Plans, and the equity compensation plan information table see Part II, “Item 5: Market for Common Equity and Related Stockholder Matters.”

ITEM 11. EXECUTIVE COMPENSATION

The following table sets forth, for the years indicated, all compensation awarded to, paid to or earned by the following type of executive officers for the fiscal years ended March 31, 2009 and 2008: (i)individuals who served as, or acted in the capacity of, our principal executive officer and principal financial officer for the years ended March 31, 2009 and 2008; and (ii) our two other most highly compensated executive officers, who together with the principal executive officer are our most highly compensated officers whose salary and bonus exceeded $100,000 with respect to the years ended March 31, 2009 and 2008 and who were employed by us at March 31, 2009.

SUMMARY COMPENSATION TABLE

Name and Principal Position	Year	Salary ($)	Bonus ($)	Stock Awards ($) (5)	Total Compensation ($)
Larry Vance Chief Executive Officer	2009 2008	176,666 (1) 160,000 (1)	0 0	12,000 0	188,666 160,000

Luis Lugo	2009	180,000 (2)	120,000 (2)	0	300,000
Chief Executive Officer	2008	0	0	0	0

Charles Bridge	2009	116,667 (3)	33,750 (3)	0	150,417
Chief Financial Officer	2008	0	0	0	0

Tami J. Story Secretary Treasurer	2009 2008	98,750 (4) 80,000 (4)	0 0	12,000 0	110,750 80,000

(1)	The entire amount of Mr. Vance’s salary was accrued during the fiscal years 2009 and 2008. During the 2009 fiscal year, Mr. Vance was paid $35,000 in accrued salaries earned in prior periods.
(2)	The entire amount of Mr. Lugo’s salary was accrued during the fiscal years 2009. Mr. Lugo’s 2009 bonus was paid in stock.
(3)	The $50,332 of Mr. Bridge’s salary was accrued during the fiscal years 2009. Mr. Bridge’s 2009 bonus was paid in stock.
(4)	The entire amount of Ms. Story’s salary was accrued during the fiscal years 2008 and 2007. During the 2009 fiscal year, Ms. Story was paid $24,000 in accrued salaries earned in prior periods.
(5)	In fiscal year 2009, each of Mr. Vance and Ms. Story received 200,000 shares of our common stock valued at $0.06 per share as compensation for serving as a director of the Company.

Outstanding Equity Awards at Fiscal Year End

There were no outstanding equity awards held by our officers at March 31, 2009.

Director Compensation

The Company does not currently have any non-employee directors; in fiscal year 2009, each of Mr. Vance and Ms. Story received 200,000 shares of our common stock valued at $0.06 per share as compensation for serving as a director of the Company.

Employment Contracts

On January 1, 2009, the Company entered into an employment agreement with Mr. Larry Vance. Pursuant to the agreement, the Company will pay Mr. Vance an annual salary of $200,000. In the event of termination of Mr. Vance without cause or due to a change in control, the Company will pay Mr. Vance two years of annual salary. Mr. Vance’s options and vesting criteria are described above and in Note 8 to the attached consolidated financial statements. The term of this agreement is four years.

On January 1, 2009, the Company entered into an employment agreement with Ms. Tami Story. Pursuant to the agreement, the Company will pay Ms. Story an annual salary of $125,000. In the event of termination of Ms. Story without cause or due to a change in control, the Company will pay Ms. Story two years of annual salary. Ms. Story’s options and vesting criteria are described above and in Note 8 to the attached consolidated financial statements. The term of this agreement is four years.

On July 1, 2008, the Company entered into an employment agreement with Mr. Luis Lugo. Pursuant to the agreement, the Company will pay Mr. Vance an annual salary of $240,000. In the event of termination of Mr. Lugo without cause or due to a change in control, the Company will pay Mr. Lugo one year of annual salary.

On September 1, 2008, the Company entered into an employment agreement with Mr. Charles Bridge. Pursuant to the agreement, the Company will pay Mr. Bridge an annual salary of $200,000. In the event of termination of Mr. Bridge without cause or due to a change in control, the Company will pay Mr. Bridge six months of annual salary.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding ownership of the Company’s Common Stock as of March 31, 2009 by each person known by the Company to own beneficially more than five percent of the Common Stock and by all directors and officers and as a group:

Name and address of beneficial owner	Amount and nature of beneficial ownership (1)	Percent of class
Larry Vance	65,075,302 (2)	72 %
P.O. Box 763
Lakeside, MT 59922

Tami Story	19,258,922	21%
P.O. Box 763
Lakeside, MT 59901

Luis Lugo	3,250,000	4%
45B Water Street
Natick, MA 01760

Charles Bridge	2,819,444	3%
30 Kaileys Way
Groton, MA 01450

All directors and officers	90,403,668	100%

___________________________

(1) Pursuant to the rules and regulations of the Securities and Exchange Commission, shares of common stock that an individual or group has a right to acquire within 60 days pursuant to the exercise of options or warrants are deemed to be outstanding for the purposes of computing the percentage ownership of such individual or group, but are not deemed to be outstanding for the purposes of computing the percentage ownership of any other person shown in the table. All shares are held directly with sole voting and investment power unless otherwise indicated.

(2) Includes 4,439 shares held by Universal Search Technology, a private company owned by Mr. Vance.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

In February 2007, Larry Vance and Tami Story, officers of the Company, together agreed to loan the Company $500,000. $170,000 of the net loan proceeds were received in March 2007 and the balance was received April 2007. The loan, along with accrued interest, is due February 26, 2008 and carries a 15% annual interest rate, compounded monthly. The loan is secured by 10,000,000 shares of the Company's common stock.

None of our directors are independent, as determined under the rules of Nasdaq.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table presents fees, including reimbursements for expenses, for professional audit services rendered by Malone & Bailey for the audits of our annual financial statements and interim reviews of our quarterly financial statements for the years ended March 31, 2009 and March 31, 2008 and fees billed for other services rendered by Malone & Bailey during those periods.

	Fiscal 2009		Fiscal 2008
Audit Fees (1)	$	61,769	$	54,215
Audit Related Fees	$	-	$	-
Tax Fees	$	-	$	-
All Other Fees	$	-	$	20,000
Total	$	61,769	$	74,215

Policy Related to Board of Directors Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Accounting Firm

As we do not currently have an audit committee, our Board of Directors has a policy of pre-approving all audit and permissible non-audit services provided by the independent auditors. These services may include audit services, audit-related services, tax services, and other services. Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. The independent auditors and management are required to periodically report to the Board of Directors regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for the services performed to date. The Board of Directors may also pre-approve particular services on a case-by-case basis.

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)(1) and (2)

Consolidated Balance Sheets as of March 31, 2009	F-3

Consolidated Statements of Operations for the years ended March 31, 2009 and 2008	F-4

Consolidated Statements of Cash Flows for the years ended March 31, 2009 and 2008	F-5

Consolidated Statement of Changes in Stockholders’ Deficit for the years ended March 31, 2009 and 2008	F-6

Notes to consolidated financial statements	F-7 – F-12

(a)(3)

2.1	Agreement and Plan of Merger by and among Earth Search Sciences, Inc., ESS Acquisition Corp., Space Technology Development Corporation and the shareholders of Space Technology Development Corporation, dated December 21, 1999 (Incorporated by reference to Exhibit 2.1 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

3.1	Articles of Incorporation, as amended (Incorporated by reference to Exhibit 3.1 to the Registrant's Forms 10-K for the fiscal years ended March 31, 1995 and March 31, 1996).

3.2	Bylaws (Incorporated by reference to Exhibit 3.2 to the Registrants’ Form 10-K for the fiscal year ended March 31, 1995).

4.1	2007 Stock Compensation Plan (Incorporated by reference to Exhibit 4.1 to the Registrants’ Form S-8 Registration No. 333-146798 filed on October 18, 2007 ).

10.1	Memorandum of Understanding between the Registrant and Applied Signal and Imaging Technology, Inc. dated May 27, 1996 (Incorporated by reference to Exhibit 10.1 to the Registrant's Form 10-K for fiscal year ended March 31, 1996).

10.2	Contract of Sale and Leaseback dated June 10, 1997 between Registrant and Accuprobe, Inc. (Incorporated by reference to Exhibit 10.2 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.3	Operating Agreement of ESSI Probe 1 LC, dated June 3, 1997 (Incorporated by reference to Exhibit 10.3 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.4	Hyperspectral Technology License Agreement between Earth Search Sciences, Inc. and Noranda Mining and Exploration, Inc. made as of December 16, 1997 (Incorporated by reference to the Registrant’s for 8-K filed on February 6, 1998).

10.5	Agreement between the Office of Naval Research and Space Technology Development Corporation Agreement for NAVY EARTHMAP OBSERVER (NEMO) dated December 10, 1997 (Incorporated by reference to Exhibit 10.5 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.6	Sales Contract between Science Applications International Corp. and Space Technology Development Corp. Dated: 30 March 1998, Contract No.: STDC-98-NEMO-0003 (Incorporated by reference to Exhibit 10.6 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.7	Sales Contract between Science Applications International Corp. and Space Technology Development Corp. Dated: 30 March 1998, Contract No.: STDC-98-NEMO-004 (Incorporated by reference to Exhibit 10.7 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.8	Sales Contract between Space Systems/Loral (SS/L) and Space Technology Development Corporation (STDC). Dated 21 January 1999, Contract Number: STDC-98-NEMO-0001 (Incorporated by reference to Exhibit 10.8 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.9	Sales Contract between Litton Systems, Inc., Amecom Division (Litton Amecom) and Space Technology Development Corp. (STDC). Date 29 October 1998, Contract Number: STDC-98-NEMO-0009 (Incorporated by reference to Exhibit 10.9 to the Registrant's Form 10-K for fiscal year ended March 31, 2000).

10.10	Common Stock Purchase Agreement between Alpha Venture Capital, Inc. and Earth Search Sciences, Inc.. Dated May 23, 2001. (Incorporated by reference to Exhibit 10.10 to the Registrant's Form 10-K for fiscal year ended March 31, 2001).

10.11	Registration Rights Agreement between Alpha Venture Capital, Inc. and Earth Search Sciences, Inc.. Dated May 23, 2001. (Incorporated by reference to Exhibit 10.11 to the Registrant's Form 10-K for fiscal year ended March 31, 2001).

10.12	Common Stock Purchase Warrant A between Alpha Venture Capital, Inc. and Earth Search Sciences, Inc. Dated May 23, 2001. (Incorporated by reference to Exhibit 10.12 to the Registrant's Form 10-K for fiscal year ended March 31, 2001).

10.13	Common Stock Purchase Warrant B between Alpha Venture Capital, Inc. and Earth Search Sciences, Inc. Dated May 23, 2001. (Incorporated by reference to Exhibit 10.13 to the Registrant's Form 10-K for fiscal year ended March 31, 2001).

10.14	Larry F. Vance employment agreement (Incorporated by reference to Exhibit 10.1 to the Registrant's Form 10-Q for fiscal quarter ended December 31, 2000).

10.15	John W. Peel employment agreement (Incorporated by reference to Exhibit 10.2 to the Registrant's Form 10-Q for fiscal quarter ended December 31, 2000).

10.16	Rory J. Stevens employment agreement (Incorporated by reference to Exhibit 10.3 to the Registrant's Form 10-Q for fiscal quarter ended December 31, 2000).

10.17	Tami J. Story employment agreement (Incorporated by reference to Exhibit 10.4 to the Registrant's Form 10-Q for fiscal quarter ended December 31, 2000).

10.18	John J. Sciuto employment agreement (Incorporated by reference to Exhibit 10.18 to the Registrant's Form 10-K for fiscal year ended March 31, 2001).

10.19	Unrestricted License Agreement for Recovery of Products from Oil Shale bgetween GENERAL SYNSFUELS INTERNATIONAL and PETRO PROBE, INC. (Incorporated by reference to Exhibit 10.19 to the Registrant’s Form 10KSB for the fiscal year ended March 31, 2007).

10.20	Multi-platform HyperSpectral imaging "Micro Sectrometer" Development Proposal Number 05080901. (Incorporated by reference to Exhibit 10.19 to the Registrant’s Form 10KSB for the fiscal year ended March 31, 2007).

10.21	Promissory Note due February 2008, dated February 2007. (Incorporated by reference to Exhibit 10.19 to the Registrant’s Form 10KSB for the fiscal year ended March 31, 2007).

10.22	Equipment Usage Agreement dated June 3, 1997, filed herewith.

16.1	Consent of Independent accountants re Registration Statement on Form No. S-1 (No. 333-66100). (Incorporated by reference to Exhibit 16.1 to the Registrant’s form 10-K for fiscal year ended March 31, 2004).

16.2	Statement under oath of Principal Executive Officer and Principal Financial Officer regarding facts and circumstances relating to exchange act filings. (Incorporated by reference to Exhibit 16.2 to the Registrant’s form 10-K for fiscal year ended March 31, 2004).

21.1.1	List of Subsidiaries (Incorporated by reference to Exhibit 21.1.1 to the Registrant's Form 10-K for fiscal year ended March 31, 2000)

23.1	Consent of Malone & Bailey, filed herewith

31.1	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, filed herewith

31.2	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, filed herewith

32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C Section 1350, filed herewith

32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, filed herewith

SIGNATURES

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

	EARTH SEARCH SCIENCES, INC.


	By:/s/Luis Lugo
	Luis Lugo
	Chief Executive Officer
	Date: June 26, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title

/s/ Luis Lugo	Chief Executive Officer and Director
Luis Lugo	(Principal Executive Officer)
Date: June 26, 2009


/s/ Charles G. Bridge Jr.	Chief Financial Officer
Charles G. Bridge Jr.	(Principal Financial Officer)
Date: June 26, 2009

Positive
Negative
Uncertain
Constraining
Legalese
Litigous
Readability	8th grade Avg

Earth Search Sciences (ESSE) 10-K2009 FY Annual report

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