Empire Energy Group Limited (EEGUF) 424B3 Prospectus supplement

Filed Pursuant to Rule 424(b)(3)
Registration No. 333-136243

EMPIRE ENERGY CORPORATION INTERNATIONAL

Prospectus Supplement

Dated August 27, 2007

(To Prospectus Dated September 29, 2006)

68,327,129

Shares of Common Stock

Par Value $0.001 Per Share

This prospectus supplement supplements information contained in, and should be read in conjunction with, that certain Prospectus, dated September 29, 2006, of Empire Energy Corporation International (the “Company”). This prospectus supplement is not complete without, and may not be delivered or used except in connection with, the original Prospectus. The Prospectus relates to the public sale, from time to time, of up to 68,327,129 shares of our common stock by the selling shareholders identified in the Prospectus.

The information attached to this prospectus supplement modifies and supersedes, in part, the information in the Prospectus. Any information that is modified or superseded in the Prospectus shall not be deemed to constitute a part of the Prospectus, except as modified or superseded by this prospectus supplement.

This prospectus supplement includes the attached Form 10-QSB Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarter ended June 30, 2006, as filed by us with the Securities and Exchange Commission on August 20, 2007.

We may amend or supplement the Prospectus from time to time by filing amendments or supplements as required. You should read the entire Prospectus and any amendments or supplements carefully before you make an investment decision.

The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities or determined if this Prospectus Supplement (or the original Prospectus dated September 29, 2006) is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus supplement is August 27, 2007

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)

OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2007

Commission File Number: 1-10077

EMPIRE ENERGY CORPORATION INTERNATIONAL

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

Nevada	87-0401761
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification number)

16801 W. 116th Street, Suite 100, Lenexa, KS	66219
(Address of Principal Executive offices)	(Zip Code)

Issuer’s telephone number: (913) 469-5615

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

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

The issuer had 206,379,784 shares of its Class A Common Stock issued and 183,879,784 shares outstanding, 100,919 shares of its Class B Common Stock issued and outstanding, and 100,919 shares of paired convertible Exchange shares issued and outstanding as of July 31, 2007, the latest practicable date before the filing of this report.

Transitional Small Business Format (check one);    Yes  ¨    No  x

PART I—FINANCIAL INFORMATION

Forward-Looking Statements

This report on Form 10-QSB contains forward-looking statements that concern our business. Such statements are not guarantees of future performance and actual results or developments could differ materially from those expressed or implied in such statements as a result of certain factors, including those factors set forth in Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations, and elsewhere in this report. All statements, other than statements of historical facts, included in this report that address activities, events or developments that we expect, believe, intend or anticipate will or may occur in the future, including the Company’s ability to successfully maintain its existence while it identifies potential business opportunities, are forward looking statements.

These statements are based on certain assumptions and analyses made by us in light of our experience and our product research. Such statements are subject to a number of assumptions including the following:

• ability to obtain financing on favorable conditions;

• the likelihood of success of the business opportunity that we are pursuing;

• risks and uncertainties;

• general economic and business conditions; and

• changes in laws or regulations and other factors, many of which are beyond our control.

The cautionary statements contained or referred to in this report should be considered in connection with any subsequent written or oral forward-looking statements that may be issued by us or persons acting on our behalf. We undertake no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Item 1. Financial Statements.

The Consolidated Financial Statements of the Company required to be filed with this 10-QSB Quarterly Report were prepared by management and commence on the following page, together with related Notes. In the opinion of management, the Consolidated Financial Statements present fairly the financial condition of the Company.

2

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED BALANCE SHEET

June 30, 2007

(Unaudited)

	June 30, 2007			December 31, 2006
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	1,620,040		$	1,457,267
Receivables net of impairment		256,351			94,605
Prepayments		249,609			1,951,181
Inventory Advances		520,020			520,020
Value of put option		—			2,655,000
TOTAL CURRENT ASSETS		2,646,020			6,678,073
MARKETABLE SECURITIES		367, 940			157,677
EQUITY INVESTMENT IN ZEEHAN ZINC LTD.		2,891,020			3,012,956
EQUITY INVESTMENT IN CHINA FOOD BRANDS		80,000			80,000
INVESTMENT IN TECHNOLOGY LICENSE		—			3,925,000
PROPERTY AND EQUIPMENT, NET		1,887,488			1,359,554
TOTAL ASSETS	$	7,872,468		$	15,213,260
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Trade and other payables	$	1,172,023		$	2,780,518
Accrued Liabilities		157,601			67,500
Current portion of long term debt		109,350			117,409
TOTAL CURRENT LIABILITIES		1,438,974			2,965,427
LONG TERM TRADE AND OTHER PAYABLES
Trade and other payables		922,573			212,011
Long term debt		4,917,538			4,762,118
TOTAL LIABILITIES		7,279,085			7,939,556
COMMITMENTS AND CONTINGENCIES		—			—
MINORITY INTEREST, PACIFIC RIM FOODS		1,196,421			951,830
STOCKHOLDERS’ EQUITY
Class A Common stock, (299,000,000 authorized) issued with a par value of $0.001, 206,379,784 and 183,879,784 shares respectively outstanding		183,880			198,879
Class B Common stock, (1,000,000 authorized) issued with a par value of $0.001, 100,919 shares issued and outstanding		101			102
Additional paid-in capital		23,558,332			26,543,332
Accumulated deficit during the development stage		(23,662,135	)		(19,946,878	)
Accumulated other comprehensive income (loss)		(683,216	)		(473,561	)
TOTAL STOCKHOLDERS’ EQUITY		(603,038	)		6,321,874
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,872,468		$	15,213,260

See summary of significant accounting policies and notes to financial statements

3

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2007 and 2006

(Unaudited)

	2007			2006
TOTAL REVENUES	$	—		$	—
COSTS AND EXPENSES
Selling, general & administrative		1,075,601			1,156,126
Exploration		1,809,132			1,515,326
TOTAL COSTS AND EXPENSES		2,884,733			2,671,452
LOSS FROM OPERATIONS		(2,884,733	)		(2,671,452	)
OTHER INCOME (EXPENSE)
Loss on Zeehan equity investment		—			(660,000	)
Other income		31,973			46,256
Gain (Loss) on disposition of investment		1,142,804			(1,142,804	)
Minority interest		24,328			152,809
Interest (expense)		(270,076	)		(83,421	)
LOSS BEFORE INCOME TAXES		(1,955,704	)		(4,358,612	)
INCOME TAXES		—
NET LOSS	$	(1,955,704	)	$	(4,358,612	)
NET LOSS PER COMMON SHARE:
Basic and diluted	$	(0.0098	)	$	(0.0286	)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic and diluted		198,878,921			152,228,508

See summary of significant accounting policies and notes to financial statements

4

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2007 and 2006

(Unaudited)

	2007			2006			March 15, 1995 (Inception) to June 30, 2007
TOTAL REVENUES	$	—		$	—		$	—
COSTS AND EXPENSES
Selling, general & administrative		1,887,767			2,207,119			13,674,435
Exploration		2,621,505			1,567,142			8,470,120
TOTAL COSTS AND EXPENSES		4,509,272			3,774,261			22,144,555
LOSS FROM OPERATIONS		(4,509,272	)		(3,774,261	)		(22,144,555	)
OTHER INCOME (EXPENSE)
Gain (Loss) on disposition of investment		1,142,804			(1,142,804	)		(84,708	)
Loss on Zeehan equity investment		—			(698,000	)		(729,000	)
Other income		43,750			103,155			196,854
Minority interest		14,409			152,809			209,827
Interest (expense)		(406,948	)		(317,124	)		(1,110,553	)
LOSS BEFORE INCOME TAXES		(3,715,257	)		(5,676,225	)		(23,662,135	)
INCOME TAXES		—			—			—
NET LOSS		(3,715,257	)		(5,676,225	)		(23,662,135	)
NET LOSS PER COMMON SHARE:
Basic and diluted	$	(0.0187	)	$	(0.0412	)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic and diluted		198,878,921			137,624,807

See summary of significant accounting policies and notes to financial statements

5

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Period From March 1995 (inception) Through June 30, 2007

(Unaudited)

	Common	Stock - A	Common	Stock - B	Additional Paid-In Capital		Accumulated Other Comprehensive Gain (Loss)		Deficit Accumulated during the Development Stage		Total Stockholders’ Equity (Deficit)
	No	$	No	$	$		$		$		$
Balance at March 15, 1995	—	—	—	—							—
Reverse Acquisition of GSLM	8,747,012	8,747	105,857	106	(8,853	)					—
Issuance of common stock: cash	1,000	1			745						746
Net loss	—	—	—	—	—		—		—		—
Balance at June 30, 1996	8,748,012	8,748	105,857	106	(8,108	)	—		—		746
Issuance of common stock: cash	59,000	59			53,977						54,036
Issuance of common stock: share premium					391,761						391,761
Net loss									(477,078	)	(477,078	)
Foreign currency translations	—	—	—	—	—		24,122		—		24,122
Balance at June 30, 1997	8,807,012	8,807	105,857	106	437,630		24,122		(477,078	)	(6,413	)
Issuance of common stock: cash	138,688	139			86,318						86,457
Issuance of common stock: share premium					857,737						857,737
Net loss									(1,247,314	)	(1,247,314	)
Foreign currency translations	—	—	—	—	—		185,864		—		185,864
Balance at June 30, 1998	8,945,700	8,946	105,857	106	1,381,685		209,986		(1,724,392	)	(123,669	)
Issuance of common stock: cash	69,581	70			328,899						328,969
Net loss									(267,403	)	(267,403	)
Foreign currency translations	—	—	—	—	—		(106,064	)	—		(106,064	)
Balance at June 30, 1999	9,015,281	9,016	105,857	106	1,710,584		103,922		(1,991,795	)	(168,167	)
Issuance of common stock: cash	35,971	36			137,205						137,241
Issuance of common stock: services	23,214	23			151,099						151,122
Net loss									(186,666	)	(186,666	)
Foreign currency translations	—	—	—	—	—		22,585		—		22,585
Balance at June 30, 2000	9,074,466	9,075	105,857	106	1,998,888		126,507		(2,178,461	)	(43,885	)

See summary of significant accounting policies and notes to financial statements

6

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Period From March 1995 (inception) Through June 30, 2007

(Unaudited)

	Common	Stock - A	Common	Stock - B	Additional Paid-In Capital		Accumulated Other Comprehensive Gain (Loss)		Deficit Accumulated during the Development Stage		Total Stockholders’ Equity (Deficit)
	No	$	No	$	$		$		$		$
Balance at July 1, 2000	9,074,466	9,075	105,857	106	1,998,888		126,507		(2,178,461	)	(43,885	)
Issuance of common stock: cash	348,214	348			1,174,477						1,174,825
Issuance of common stock: services	23,317	23			67,863						67,886
Issuance of common stock: bonus issue	51,911,055	51,911			(51,911	)					—
Net loss									(1,767,759	)	(1,767,759	)
Foreign currency translations	—	—	—	—	—		73,133		—		73,133
Balance at June 30, 2001	61,357,052	61,357	105,857	106	3,189,317		199,640		(3,946,220	)	(495,800	)
Issuance of common stock: cash	609,000	609			590,642						591,251
Issuance of common stock: services	3,955,125	3,955			530,778						534,733
Stock issuance costs					(44,109	)					(44,109	)
Net loss									(1,382,217	)	(1,382,217	)
Foreign currency translations	—	—	—	—	—		(83,949	)	—		(83,949	)
Balance at June 30, 2002	65,921,177	65,921	105,857	106	4,266,628		115,691		(5,328,437	)	(880,091	)
Issuance of common stock: cash	1,028,764	1,029			607,613						608,642
Issuance of common stock: services	3,955,125	3,955			2,119,156						2,123,111
Stock issuance costs					(286,040	)					(286,040	)
Net loss									(2,901,629	)	(2,901,629	)
Foreign currency translations	—	—	—	—	—		(233,528	)	—		(233,528	)
Balance at June 30, 2003	70,905,066	70,905	105,857	106	6,707,357		(117,837	)	(8,230,066	)	(1,569,535	)
Issuance of common stock: cash	246,800	247			159,926						160,173
Issuance of common stock: services	21,928	22			16,238						16,260
Stock issuance costs					2,007						2,007
Net loss									(599,870	)	(599,870	)
Foreign currency translations	—	—	—	—	—		(24,630	)	—		(24,630	)
Balance at June 30, 2004	71,173,794	71,174	105,857	106	6,885,528		(142,467	)	(8,829,936	)	(2,015,595	)
Net loss for 6 months									(188,615	)	(188,615	)
Foreign currency translations for 6 months	—	—	—	—	—		(274,088	)	—		(274,088	)
Balance at Dec 31, 2004	71,173,794	71,174	105,857	106	6,885,528		(416,555	)	(9,018,551	)	(2,478,298	)

See summary of significant accounting policies and notes to financial statements

7

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Period From March 1995 (inception) Through June 30, 2007

(Unaudited)

	Common	Stock - A	Common		Stock - B		Additional Paid-In Capital		Accumulated Other Comprehensive Gain (Loss)		Deficit Accumulated during the Development Stage		Total Stockholders’ Equity (Deficit)
	No	$	No		$		$		$		$		$
Balance at Jan 1, 2005	71,173,794	71,174	105,857		106		6,885,528		(416,555	)	(9,018,551	)	(2,478,298	)
Issuance of common stock: debt	29,458	29					(29	)					—
Issuance of common stock: services	2,634,319	2,634					(2,634	)					—
Conversion of Class B stock into Class A	2,471	3	(2,471	)	(3	)							—
Reverse Acquisition of GSLM							(213,249	)					(213,249	)
Issuance of common stock: contingency	2,490,000	2,490					(2,490	)					—
Issuance of common stock: Acquisition of Cyber Finance	37,500,000	37,500					5,962,500						6,000,000
Issuance of common stock: services	830,000	830					98,770						99,600
Net loss for year											(1,897,847	)	(1,897,847	)
Foreign currency translations	—	—	—		—		—		159,086		—		159,086
Balance at Dec 31, 2005	114,660,042	114,660	103,386		103		12,728,396		(257,469	)	(10,916,398	)	1,669,292
Issuance of common stock: HEM convertible debenture	6,222,675	6,223					498,500						504,723
Issuance of common stock: services	21,185,493	21,186					2,398,121						2,419,307
Conversion of Class B stock into Class A	1,604	1	(1,604	)	(1	)							—
Issuance of common stock: Exchange for debt	19,360,774	19,361					1,895,665						1,915,026
Issuance of common stock: Cash	17,933,333	17,933					2,013,067						2,031,000
Issuance of common stock: Libertas, less stock fees of $359,400	4,065,000	4,065					205,935						210,000
Issuance of common stock: exercise of options	450,000	450					2,835						3,285
Issuance of common stock: License	15,000,000	15,000					2,985,000						3,000,000
Beneficial conversion feature, convertible debenture	—	—					837,173						837,173
Vesting of Common Stock Options							323,640						323,640
Warrants Issued: Wind City put option							2,655,000						2,655,000
Net loss for period											(9,030,480	)	(9,030480	)
Marketable securities, unrealized loss									(15,006	)			(15,006	)
Foreign currency translations	—	—	—		—		—		(201,086	)	—		(201,086	)
Balance at Dec 31, 2006	198,878,921	198,879	101,782		102		26,543,332		(473,561	)	(19,946,878	)	6,321,874

See summary of significant accounting policies and notes to financial statements

8

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Period From March 1995 (inception) Through June 30, 2007

(Unaudited)

	Common		Stock - A		Common		Stock - B	Additional Paid-In Capital		Accumulated Other Comprehensive Gain (Loss)		Deficit Accumulated during the Development Stage		Total Stockholders’ Equity (Deficit)
	No		$		No		$	$		$		$		$
Balance at January 1, 2007	198,878,921		198,879		101,782		102	26,543,332		(473,561	)	(19,946,878	)	6,321,874
Conversion of Class B stock into Class A	863		1		(863	)	1
Return of Shares: termination of technology license	(15,000,000	)	(15,000	)	—		—	(2,985,000	)	—		—		(3,000,000	)
Foreign currency translations	—		—		—		—	—		114,913		—		114,913
Securities mark to market	—		—		—		—	—		(324,568	)	—		(324,568	)
Net loss for the period	—		—		—		—	—		—		(3,715,257	)	(3,715,257	)
Balance at June 30, 2007	183,879,784		183,880		100,919		101	23,558,332		(683,216	)	(23,662,135	)	(603,038	)

See summary of significant accounting policies and notes to financial statements

9

EMPIRE ENERGY CORPORATION INTERNATIONAL

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2007 and 2006

(Unaudited)

	Note	2007		2006		March 15, 1995 (Inception) to June 30, 2007
		$		$		$
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		(3,715,257	)	(5,676,224	)	(23,662,135	)
Adjustments to reconcile net loss to net cash used in operating activities:
Share issues for services		—		838,200		5,412,018
Depreciation		10,448		53,234		78,768
Loss on disposal of fixed assets		—		—		207
Loss on equity investment		—		698,000		729,000
Stock options vested		—		—		323,640
Gain (Loss) on termination of technology license		(1,142,804	)	1,142,804		84,708
Minority interest		(14,409	)	183,770		155,680
Changes in operating assets and liabilities:
(Increase) Decrease in receivables		(161,746	)	(137,825	)	(360,821	)
(Increase) Decrease in prepaid expenses		1,701,572		(271,444	)	(665,159	)
(Increase) Decrease in payables		(567,622	)	797,060		4,607,083
NET CASH USED IN OPERATING ACTIVITIES		(3,889,818	)	(2,372,425	)	(13,297,011	)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds of Zeehan stock sale		4,500,000		—		4,605,532
Loans to Zeehan Zinc, Ltd.		—		(1,040,207	)	—
Investment in brands		—		(80,001	)	(80,000	)
Purchase of property and equipment		(538,382	)	(10,494	)	(1,914,609	)
Investment in marketable securities		(190,091	)	—		(362,774	)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES		3,771,527		(1,130,702	)	2,248,149
CASH FLOWS FROM FINANCING ACTIVITIES
Capital raising costs		—		—		(328,142	)
Net proceeds from borrowings		—		1,500,000		5,969,956
Proceeds from issuance of shares		—		1,881,000		6,422,838
Principal payments on notes payable		(92,849	)	—		(92,849	)
Proceeds from the sale of equity in subsidiary		259,000		460,000		1,040,741
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		166,151		3,841,000		13,012,544
EFFECT OF EXCHANGE RATE CHANGES ON CASH		114,913		24,103		(343,642	)
NET INCREASE IN CASH AND CASH EQUIVALENTS		162,773		361,976		1,620,040
CASH AND CASH EQUIVALENTS – beginning of period		1,457,267		6,084		—
CASH AND CASH EQUIVALENTS – end of period		1,620,040		368,060		1,620,040
CASH PAID FOR:
Taxes		—		—		—
Interest		246,005		10,352		391,488

See summary of significant accounting policies and notes to financial statements

10

EMPIRE ENERGY CORPORATION INTERNATIONAL

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 31, 2007 and 2006 (Unaudited)

NOTE 1 – ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation: The accompanying unaudited interim financial statements of Empire Energy Corporation International (“EEGC”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto contained in Empire’s Annual Report filed with the SEC on Form 10-KSB for the year ended December 31, 2006. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for 2006 as reported in the 10-KSB have been omitted.

Organization: Empire Energy Corporation International (“EEGC” or “the Company”) was incorporated in Utah on November 10, 1983. EEGC commenced commercial activity in the oil and gas industry on May 17, 1999. The primary prospect was in Nicaragua. EEGC also participated in an exploration program in Tennessee in 1999 and continued until 2002. During 2000 and 2001, EEGC acquired additional production and/or prospects in Texas, Oklahoma and Wyoming.

During 2002, EEGC sold most of its oil and gas properties and entered into an agreement to acquire Great South Land Minerals (“GSLM”). Effective April 12, 2004, EEGC changed its name from Empire Energy Corporation to Empire Energy Corporation International, reincorporated in the state of Nevada, increased the authorized shares from 50 million to 100 million and effected a 1 for 10 reverse stock split. During 2003 and 2004, EEGC sold all properties, settled some debts and pursued the acquisition of GSLM, which was completed April 7, 2005. In August 2005, EEGC further increased its authorized shares from 100 million to 300 million.

Reverse Acquisition: On April 7, 2005 (acquisition date) Empire Energy received 96.4% acceptances for its bid to acquire all the common stock in GSLM and on June 15, 2005 Empire Energy compulsorily acquired the remaining common stock of GSLM. All of the outstanding shares of GSLM were exchanged for 62,426,782 shares of Empire Energy common stock in a one for one scrip issue.

Pursuant to the guidance in Appendix B of SEC Accounting Disclosure Rules and Practices Official Text, the merger of a private operating company into a non-operating public shell corporation with nominal net assets typically results in the owners and management of the private company having actual or effective operating control of the combined company after the transaction, with the shareholders of the former public shell continuing only as passive investors. These transactions are considered by the staff to be capital transactions in substance, rather than business combinations. That is, the transaction is equivalent to the issuance of stock by the private company for the net monetary assets of the shell corporation, accompanied by a recapitalisation. Accordingly, the reverse acquisition has been accounted for as a recapitalisation. For accounting purposes, GSLM is considered the acquirer in the reverse acquisition and all history presented is that of GSLM. Operating results of EEGC are included in these consolidated financial statements from the date of the reverse acquisition, April 7, 2005. References to EEGC in the remainder of these notes will refer to the consolidated company including the operating history of GSLM unless otherwise specified.

The costs of the reverse acquisition (transaction costs) have been charged to expense.

The accompanying consolidated financial statements of the Company reflect the historical results of GSLM, and the consolidated results of operations of the Company and GSLM subsequent to the date of acquisition.

Principles of Consolidation: The consolidated financial statements include the accounts of EEGC (the “Parent” entity) and its wholly owned or controlled subsidiaries. All significant intercompany balances and transactions have been eliminated on consolidation.

11

EMPIRE ENERGY CORPORATION INTERNATIONAL

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2007 and 2006 (Unaudited)

Equity Investment: In November 2005, EEGC acquired a British Virgin Islands Company, Cyber Finance Group, Ltd. (Cyber) in exchange for 37.5 million shares of newly issued EEGC common stock. The sole asset of Cyber was an investment of 12,745,407 shares of common stock in Zeehan Zinc Limited (Zeehan), representing at the time approximately 37.5% of the total outstanding shares of Zeehan. This investment was accounted for using the equity method. Under this method the investment is recorded at cost on a single line on the balance sheet when the investment is made and the company records its proportional share of the results of operations on a single line on the statement of operations.

During the third quarter of 2006, the investment in Zeehan shares was reduced to below 20% of total outstanding shares and the Company converted to the cost method of accounting for this investment. Under this method the investment is valued at cost until a transaction occurs. The proportionate share of the results of operations is no longer reported periodically.

Going Concern and Liquidity: EEGC is in the development stage, devoting substantially all of its efforts to exploration and raising financing. EEGC has substantially funded its operations with proceeds from the issuance of common stock. In the course of its exploration activities, EEGC has sustained operating losses and expects such losses to continue for the foreseeable future. EEGC will finance its operations primarily through cash and cash equivalents on hand, future financing from the issuance of debt or equity instruments and through the generation of revenues once commercial operations get underway. However, the Company has yet to generate any significant revenues and has no assurance of future revenues. To management’s knowledge, no company has yet successfully developed sub-surface hydrocarbons in commercial quantities in Tasmania. Even if development efforts are successful, substantial time may pass before revenues are realised.

The financial statements are prepared on a going concern basis. However, significant uncertainties exist in relation to conditions that cast doubt upon the Company’s ability to continue as a going concern. These are:

• Substantial losses incurred through supporting the ongoing exploration expenditure during the period since the inception of the Company.

• Uncertainties in terms of the ability to generate cash flows in the future considering that production operations have not yet commenced.

• Extensive commitments for expenditure under the Company’s key mineral exploration lease.

• Current liabilities of $1,438,974 and current assets of $2,646,020 including cash or cash equivalents of $1,620,040 at June 30, 2007.

The exploration license SEL 13/98 has been renewed effective 1 October 2004, and has strict mandatory cumulative expenditure requirements of $3,626,797 by 30 September 2005, $5,677,521 by 30 September 2006, $8,936,274 by 30 September 2007, $13,370,464 by 30 September 2008 and $14,599,541 by 30 September 2009 without which the license may be revoked at the discretion of the Minister, Resources and State Development.

In November 2006, the Minister for Economic Development and Resources wrote to the company noting their intention to revoke special exploration licence 13/98 on the grounds of the failure of the company to comply with the mandatory cumulative expenditure requirements. This letter stated that “As of 30 September 2006, Mineral Resources Tasmania has recorded expenditure of AUD $2,865,689.70 which is AUD $3,823,111.30 short of the mandatory expenditure required by the end of the second year of the license.” In November 2006, the company responded with a submission requesting the withdrawal of the notice of intention to revoke the licence and submitted numerous reasons why the licence should not be revoked. As a consequence of the submission, in May 2007 the Director of Mines responded and advised that he would no longer seek revocation of the license.

12

EMPIRE ENERGY CORPORATION INTERNATIONAL

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2007 and 2006 (Unaudited)

There can be no assurance that the Company will be able to obtain financing on commercially reasonable terms. The continuing viability and its ability to continue as a going concern and to meet its obligations as they fall due is dependent on the Company being successful in raising additional funds. The Company’s inability to raise capital may have a material adverse affect on its financial condition, ability to meet its obligations and operating needs and results of operations.

The consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or to the amounts and classification of liabilities that might be necessary should the Company not continue as a going concern.

The Company has planned the following activities and the following activities exist to address the above going concern issues.

The directors have reviewed their short-term cash flow requirements and consider that the company has or has access to sufficient funds to meet the financial obligations of the company.

These include:

• Great South Land Minerals Limited entered into a Convertible Note Agreement dated 14 December 2006 with Wind City Inc for a value of USD 4 million maturing May 31, 2008. This arrangement was backed with a corresponding Warrant Purchase between Empire Energy International, and Wind City Inc. The proceeds from the loan were used to fund seismic services by Terrex Seismic and acquire a newly constructed drilling rig from George E. Failing Company and related support equipment which will be used to meet the license requirement.

• In December 2006 the Company sold warrants to purchase sixty million shares of its common stock to Wind City Inc in conjunction with the Note Agreement. These warrants expire November 30, 2007 and have the potential to repay the USD 4 million note and generate up to an additional USD 5 million.

• On 5 January 2007, the Company exercised the put option included in the Wind City financing and Empire Energy received USD 4.5 million in consideration of the 4,500,000 ordinary shares of Zeehan Zinc, Ltd.

The directors have reviewed the cash flow requirements necessary to meet the company’s exploration expenditure commitments and consider that the following actions will ensure that the company has access to sufficient funds.

These include:

• Obtaining approval to increase authorised shares to allow additional acquisitions and fund-raising activities

• Seeking acquisitions that will provide capital and cash flow

• Working on refinancing opportunities and using the additional shares to pursue development activities.

• Entering into negotiations with a number of parties for additional funding.

• If warrants are exercised, we could receive up to USD 4 million from exercise of warrants that expire November 30, 2007 to repay the Wind City note, or selling shares currently reserved for those warrants to repay the loan that matures May 31, 2008.

• If warrants are exercised, we could receive up to an additional USD 5 million from exercise of warrants that expire November 30, 2007 or selling shares currently reserved for those warrants to obtain additional funding.

Emphasis of Matter: The report of the independent registered public accounting firm on EEGC’s financial statements for the years ended 31 December 2006 and 2005 contained an emphasis of matter paragraph regarding the Company’s ability to continue as a going concern.

13

EMPIRE ENERGY CORPORATION INTERNATIONAL

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2007 and 2006 (Unaudited)

NOTE 2 – TAXATION

In assessing the realisability of deferred tax assets, the Company applies SFAS No. 109 to determine whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. As a result, the Company’s valuation allowance at June 30, 2007 and 2006 reduces the net deferred tax assets to $0.

NOTE 3 – SALE OF SHARES OF ZEEHAN ZINC LIMITED

On January 5, 2007, the Company’s wholly-owned subsidiary, Cyber Finance Group Limited, exercised the put option it received in conjunction with warrants issued in December 2006 to require Wind City to purchase 4,500,000 of Cyber’s ordinary shares of Zeehan at a price of US $1.00 per share. This transaction was completed in January, 2007 for total proceeds of $4,500,000.

NOTE 4 – EQUITY TRANSACTIONS, ZEEHAN SHARES AND TECHNOLOGY LICENSE

On June 29, 2007, the Company agreed to terminate a license agreement entered in 2006 that allowed the Company to promote use of certain nano technology. In exchange for terminating the license agreement, the Company will receive a refund of the license fee, consisting of five million shares of common stock of Zeehan Zinc Limited and fifteen million shares of its own common stock. The value recorded for the stock to be returned was the original cost basis in the Zeehan stock $.41 per Zeehan share and the value assigned to the Empire shares when they were issued of $.20 per Empire share or a total of $5,067,804. The gain recorded on the termination reversed the loss recorded when the license agreement was initiated. The value of the Empire shares was returned to Company capital. The value of the Zeehan shares was recorded as an asset. This value of the Zeehan shares was then reduced by $344,740 through comprehensive income to reflect the quoted market value at of those shares at June 30, 2007. To comply with investment ownership limitations, the agreement provides that the licensor will sell the shares in an orderly manner and forward the proceeds to the Company. The Company intends to use proceeds of sale of the shares to provide additional funding for oil and gas exploration and development activities.

14

Item 2. Managements Discussion and Analysis or Plan of Operation

Our twelve-month plan of operation:

Our primary focus is the discovery and exploitation of oil and gas and we intend to apply all resources to that purpose. We currently have four wholly-owned subsidiaries: Great South Land Minerals Limited, Cyber Finance Group Limited, Expedia Limited and Batego Limited. We also own approximately 48% of Pacific Rim Foods Limited and include Pacific Rim Foods in our consolidated financial statements on the basis of control established by a voting agreement. Our primary endeavor is the exploration for and development of oil and natural gas in the state of Tasmania, Australia undertaken by GSLM. Cyber holds our initial investment in Zeehan Zinc limited, a Tasmanian mining company. Expedia held our investment in certain technology licenses. Batego was acquired in the termination of the technology license and holds the Empire shares and Zeehan share proceeds receivable received in that transaction. Pacific Rim Foods has interests in the Chinese shelf stable foods and agriculture industries.

GSLM holds Special Exploration License 13/98 under terms set by Mineral Resources Tasmania, the local authority under the Department of Industry, Energy and Resources (DIER), that require the company to expend no less that AUD $21.5 million (US $17.42 million) by September, 2009.

Terrex Seismic has completed its summer 2007 program, shooting approximately 338 kilometers of 2D seismic. Terrex will complete this program in the summer of 2008 finishing the AUD $4.4 million seismic as a continuation of the AUD $2.2 million 2006 program. In the 2001 survey, at a cost of AUD $3.3 million, we acquired 660 line kilometers of survey. When the 2008 summer program is completed, we should have acquired a total of 1,846 line kilometers at a total cumulative cost of over AUD $10 million. These surveys have, so far, indicated the presence of over 14 structures with the potential to have trapped oil and natural gas. An extensive gravity survey has been completed by Solo Geophysics over our central plateau area including the Bellevue and Thunderbolt Domes. This gravity survey will be critical to the interpretation of the seismic results which should be processed and interpreted within the next three months. Our two largest structures, the Bellevue Dome and the Thunderbolt Dome are over 1000 sq km (2.47 million acres) in area and have the potential to contain substantial volumes of oil and natural gas.

In addition to the seismic and gravity program, we began and plan to continue exploratory drilling involving initially four sites that have been approved and another ten sites that have been identified by geophysics beginning in the Australian spring of 2007. We are presently recruiting experienced oil executives and oil field management, seeking experienced drilling crew, identifying and acquiring ancillary equipment to complement the new drill rig we acquired in December 2006 and pursuing additional vend-in property. We have hired experienced drilling crew with current international blow out certification currently working on identical equipment in the United States to train and compliment the crew being recruited in Tasmania.

As announced during the fourth quarter of 2005, we obtained an exclusive license for the nano-key ball mill technology. We determined that this technology would be a longer term development project so in June 2007 we entered into an agreement to terminate this license agreement and obtain a return of the license fee. We plan to use the proceeds of the sale of the five million shares of Zeehan common stock and fifteen million shares of Empire common stock we will receive to fund our ongoing oil and gas exploration, drilling and development program during the third and fourth quarters of 2007.

15

Results of operations

Since the inception of our current business plan following our merger with GSLM in 2005, our operations have consisted primarily of various start-up activities relating to our current business, including seeking institutional investors, locating joint venture partners, engaging firms to comply with leasehold conditions, incurring strategic investments and developing our long term business strategies.

During the quarter ended June 30, 2007, the combined Company generated no revenue. The combined Company generated a loss of $1,956,000 primarily by incurring GSLM exploration expenses of $1,809,000 and general & administrative expenses of $1,076,000, primarily personnel and consulting expenses required to maintain the corporate existence and pursue funding for GSLM exploration activities and oversee the seismic and gravity evaluation and prepare the drilling program. During the quarter ended June 30, 2006, the Company also generated no revenue. The Company generated a loss of $4,359,000 incurring exploration expenses of $1,515,000 and general and administrative expenses of $1,156,000, primarily legal, accounting, auditing and consulting expenses required to maintain the corporate existence and pursue funding for and planning for the exploration and drilling program.

During the six months ended June 30, 2007, the combined Company generated no revenue. The combined Company generated a loss of $3,715,000 primarily by incurring GSLM seismic and exploration expenses of $2,622,000 and general & administrative expenses of $1,888,000, Primarily personnel, consulting and legal required to maintain the corporate existence and pursue funding and planning for GSLM exploration activities and oversee the seismic and gravity evaluation work. During the six months ended June 30, 2006, the Company also generated no revenue. The Company generated a loss of $5,676,000 primarily by incurring exploration expenses of $1,567,000 and general and administrative expenses of $2,207,000, primarily legal, accounting, auditing and consulting expenses required to maintain the corporate existence and pursue funding for and planning for the exploration and drilling program.

Liquidity and Capital Resources

On June 30, 2007, the Company had $1,620,000 in cash, $250,000 in prepayments of legal and facility expenses, $256,000 in receivables, and $1,439,000 in current liabilities including trade payables, accrued liabilities, and current maturities of debt. Additional liabilities include approximately $4,900,000 in long-term debt and approximately $923,000 in non-current trade payables. Substantially all long-term debt includes provisions by which the holder may convert the debt to common equity. Net cash used in operating activities for the six months ended June 30, 2007 was $3,890,000 compared to $2,372,000 for the six months ended June 30, 2006. Cash provided by investing activities was $3,772,000 during the six months ended June 30, 2007, primarily as a result of the $4,500,000 received from the sale of Zeehan Zinc shares. Cash used in investing activities during the six months ended June 30, 2006 was $1,131,000, primarily a loan to Zeehan Zinc, Ltd. Net cash provided by financing activities during the six months ended June 30, 2007 was $166,000, including $259,000 received as equity invested in the Pacific Rim subsidiary, reduced by repayment of notes payable. Net cash provided by financing activities was $1,500,000 from sale of convertible debentures, $1,881,000 from sale of Empire common stock and $460,000 from the sale of common stock in our Pacific Rim subsidiary during the six months ended June 30, 2006.

Additional financing will be needed during 2007 to continue to develop the license property and pursue the company’s business plan. We have paid interest due August 31, 2007 on our note payable to Wind City. The next payment will be due November 30, 2007, at which time warrants held by Wind City to purchase sixty million shares of our stock for a potential total price of $9 million will also expire.

Off Balance Sheet Arrangements

Empire Energy has no off-balance sheet arrangements.

16

Item 3. Controls and Procedures

We maintain a system of disclosure controls and procedures that are designed for the purposes of ensuring that information required to be disclosed in our SEC reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, as appropriate to allow timely decisions regarding required disclosure.

We carried out an evaluation, under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-QSB. Based upon that evaluation, the Chief Executive Officer concluded that our disclosure controls and procedures are effective for the purposes discussed above as of the end of the period covered by this Quarterly Report on Form 10-QSB. There was no significant change in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 6. Exhibits

(a) The following exhibits are furnished as part of this report:

1. Exhibit 31 Certification required by Section 302 of the Sarbanes-Oxley Act of 2002.

2. Exhibit 32 Certification required by Section 906 of the Sarbanes-Oxley Act of 2002.

17

SIGNATURES

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

	Empire Energy Corporation International
August 20, 2007	By:	/s/ Malcolm Bendall
		Malcolm Bendall Chief Executive Officer Chief Financial Officer

18

Exhibit 31

SECTION 302 CERTIFICATION OF CEO AND CFO

CERTIFICATION

I, Malcolm Bendall, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of Empire Energy Corporation International;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;

4. The small business issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designated under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designated under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and

5. The small business issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer’s auditors and the audit committee of small business issuer’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal controls over financial reporting.

Date: August 20, 2007

/s/ MALCOLM BENDALL

Malcolm Bendall

Chief Executive Officer

Chief Financial Officer

Exhibit 32

SECTION 906 CERTIFICATION OF CEO AND CFO

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Empire Energy Corporation International (the “Company”) on Form 10-QSB for the period ending June 30, 2007 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Malcolm Bendall, Chief Executive Officer and Chief Financial Officer of the Company, hereby certifies, pursuant to and solely for the purpose of 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, to the best of his knowledge and belief, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities and Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 20, 2007

/s/ MALCOLM BENDALL

Malcolm Bendall

Chief Executive Officer

Chief Financial Officer