10-Q 1 eco10q93011.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q |X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2011 |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______to______. Commission File Number 333-138989 ecoTECH Energy Group Inc. (Exact name of registrant as specified in its charter) Nevada 98-0479847 ------------------------------------- -------------------------------- State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization 800 Fifth Avenue, Suite 4100, Seattle, WA 98104 (Address of principal executive offices) (Zip Code) 206-259-7867 Registrant's telephone number, including area code. Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_| Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes |_| No |X| Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Larger accelerated filer [_] Accelerated filer [_] Non-accelerated filer [_] Smaller reporting company [X] Indicate by check mark whether registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes |_| No |X| As of October 31, 2011, the registrant had 199,802,202 shares of its common stock issued and outstanding. Documents incorporated by reference: None 1 ECOTECH ENERGY GROUP INC. FORM 10-Q September 30, 2011 TABLE OF CONTENTS Page PART I-- FINANCIAL INFORMATION Item 1. Consolidated Financial Statements 3 Item 2. Management's Discussion and Analysis or Plan of Operations 14 Item 3. Quantitative and Qualitative Disclosures About Market Risk 18 Item 4T Control and Procedures 18 PART II-- OTHER INFORMATION Item 1 Legal Proceedings 19 Item 1A Risk Factors 19 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 19 Item 3. Defaults Upon Senior Securities 20 Item 4. (Removed and Reserved) 20 Item 5. Other Information 20 Item 6. Exhibits 20 SIGNATURES 22 2 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS ECOTECH ENERGY GROUP INC. (A Development-Stage Company) CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars) (Unaudited) SEPTEMBER 30, 2011 Financial Statements Page Consolidated Balance Sheets F-4 Consolidated Statements of Operations and Comprehensive Loss F-5 Consolidated Statements of Cash Flows F-6 to F-7 Notes to Consolidated Financial Statements F-8 to F-13 F-3

ECOTECH ENERGY GROUP INC. (A Development-Stage Company) CONSOLIDATED BALANCE SHEETS (Unaudited) ~~June~~September 30, December 31, 2011 2010 ---------------------- -------------------- ASSETS Current Assets Cash and cash equivalents $ 75,~~879~~134 $ 12,262 Due from related parties 32,~~123~~953 73,~~311~~055 Prepaid expenses 76,~~474~~602 37,~~055~~311 ~~---------------------- --------------------~~ Total Current Assets 1814,~~476~~689 22,628 ---------------------- -------------------- Deposits 2321,~~032~~547 60,033 Property, plant and equipment, net (Note 4) ~~399~~394,~~781~~652 180,039 ---------------------- -------------------- TOTAL ASSETS $ ~~441~~430,~~289~~888 $ 262,700 ====================== ==================== LIABILITIES AND STOCKHOLDERS' DEFICIT Current Liabilities Accounts payable $ ~~631~~654,~~780~~249 $ 503,883 Accounts payable - related parties ~~111~~110,~~604~~088 110,542 Accrued liabilities (Notes 5 and 9) 2,~~094~~194,~~251~~247 1,596,213 Note payable to related parties (Note 6) ~~118~~124,~~912~~178 85,193 ---------------------- -------------------- Total Current Liabilities 23,~~956~~082,~~547~~762 2,295,831 ---------------------- -------------------- Notes payable (Note 4) ~~204~~193,~~760~~640 - ---------------------- -------------------- TOTAL LIABILITIES 3,~~161~~276,~~307~~402 2,295,831 Commitments and contingencies (Note 7) STOCKHOLDERS' DEFICIT Common Stock Common stock, $0.001 par value 675,000,000 shares authorized; 196,~~809~~886,~~384~~577, and 195,233,427 common shares issued at ~~June~~September 30, 2011 and December 31, 2010, respectively. 196,~~809~~887 195,233 Additional paid-in capital 30,~~099~~241,~~469~~439 29,392,934 Accumulated other comprehensive income 2,499 2,499 Cumulative foreign currency translation adjustment (~~Note 9) (167~~7,~~954~~934) (125,745) Deficit accumulated during the development stage (3233,~~850~~278,~~841~~405) (31,498,052) ---------------------- -------------------- Total Stockholders' Deficit (2,~~720~~845,~~018~~514) (2,033,131) ---------------------- -------------------- TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ ~~441~~430,~~289~~888 $ 262,700 ====================== ==================== The accompanying notes are an integral part of these statements. F-4

ECOTECH ENERGY GROUP INC. (A Development-Stage Company) CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) ~~November 28,~~ For the For the For the For the ~~2007~~November 28, three-months three-months ~~six~~nine-months ~~six~~nine-months ~~(Inception)~~2007 ended ended ended ended (Inception) to ~~June~~September 30, ~~June~~September 30, ~~2011~~September ~~June~~ 30, ~~2010~~September ~~June~~30, September 30, 2011 ~~June~~2010 ~~30,~~2011 2010 2011 ---------------- --------------- ---------------- ----------------- ----------------- Revenues $ - $ - $ - $ - $ - Operating Expenses General and administration ~~898~~416,~~769~~944 ~~256~~302,~~647~~831 1,~~327~~744,~~354~~304 15,~~372~~675,~~879~~710 29,~~370~~787,~~084~~035 Research and development ~~4,927~~- - 17,~~443~~437 - 420,~~956~~950 ---------------- --------------- ---------------- ----------------- ----------------- Total operating expenses ~~903~~416,~~696~~944 ~~256~~302,~~647~~831 1,~~344~~761,~~797~~741 15,~~372~~675,~~879~~710 2930,~~791~~207,~~040~~985 ---------------- --------------- ---------------- ----------------- ----------------- Operating Loss (~~903~~416,~~696~~944) (~~256~~302,~~647~~831) (1,~~344~~761,~~797~~741) (15,~~372~~675,~~879~~710) (2930,~~791~~207,~~040~~985) Other (Income) and Expenses Loss on disposal of fixed ~~assets~~ - - - - 5,704 Interest expense 13,~~299~~515 114,~~032~~774 2236,~~730~~245 1923,~~014~~788 2,~~254~~267,~~161~~675 Extinguishment of ~~convertible debt~~ - - - - 700,535 Other income ~~(5)~~- - (5) - (83,222) ---------------- --------------- ---------------- ----------------- ----------------- Net loss before income tax benefit (~~916~~430,~~990~~459) (~~267~~307,~~679~~605) (1,~~367~~797,~~522~~981) (15,~~391~~699,~~893~~498) (3233,~~668~~098,~~218~~677) Income tax benefit (Note 2) (32,~~151~~895) ~~(122)~~91 (1417,~~733~~628) (17,~~411~~320) (5255,~~805~~700) ---------------- --------------- ---------------- ----------------- ----------------- Net Loss (~~913~~427,~~839~~564) (~~267~~307,~~557~~696) (1,~~352~~780,~~789~~353) (15,~~374~~682,~~482~~178) (3233,~~615~~042,~~413~~977) ================ =============== ================ ================= ================= Changes in cumulative foreign currency translation adjustment (14160,~~377~~020) ~~(42~~34,~~973)~~058 ~~42,209~~ (5117,~~835~~811) ~~167~~28,~~954~~223 7,934 ---------------- --------------- ---------------- ----------------- ----------------- Comprehensive Loss $ (~~899~~267,~~462~~544) $ (~~224~~341,~~584~~754) $ (1,~~394~~662,~~998~~542) $ (15,~~368~~710,~~647~~401) $ (3233,~~783~~050,~~367~~911) ================ =============== ================ ================= ================= Basic and diluted loss per common share $ (0.00) $ (0.00) $ (0.01) $ (0.1609) ================ =============== ================ ================= Weighted Average Number of Shares Outstanding 196,~~282~~833,~~418~~770 ~~103~~184,~~066~~219,~~253~~698 ~~195~~196,~~791~~140,~~761~~774 98180,~~719~~422,~~282~~307 ================ =============== ================ ================= The accompanying notes are an integral part of these statements. F-5

ECOTECH ENERGY GROUP INC. (A Development-Stage Company) CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) For the For the ~~six-months~~nine ~~six~~nine-months Cumulative from months ended ended November 28, 2007 ~~June~~September 30, ~~June~~September 30, (Inception) to 2011 2010 ~~June~~September 30, 2011 ~~--------------------- ---------------- ---------------------~~ Cash Flows From in Operating Activities Net loss $ (1,~~352~~780,~~789~~353) $ (15,~~374~~710,~~482~~401) $ (3233,~~615~~042,~~413~~977) Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: Depreciation 3350,~~713~~553 2850,~~326~~269 ~~180~~197,~~858~~698 Stock-based compensation ~~585~~697,~~000~~500 14,929,920 25,~~406~~519,~~952~~452 Accretion of beneficial conversion features - - 541,131 Loss on extinguishment of convertible debt - - 700,535 Financing costs - - 1,389,908 Income tax benefit on flow-through shares (1417,~~733~~628) - (1417,~~733~~628) Changes in operating assets and liabilities Prepaid expenses -493 (910,~~493~~281) (98,~~455~~962) Deposits 38,~~320~~555 (1541,~~852~~352) (18,~~649~~414) Accounts payable ~~150~~210,~~468~~447 7536,~~604~~871 ~~979~~1,~~105~~039,084 Accrued liabilities ~~472~~665,~~696~~548 ~~173~~284,~~088~~298 1,~~654~~847,~~537~~389 --------------------- ----------------- --------------------- Net Cash Used in Operating Activities (87134,~~325~~885) (~~192~~460,~~889~~676) (1,~~805~~852,~~224~~784) Cash Flows From Investing Activities Cash received in reverse acquisition - - 8,510 Purchase of property, plant and equipment (51,415) -(9,272) (391,390) --------------------- ----------------- --------------------- Net Cash Used in Investing Activities (51,415) -(9,272) (382,880) Cash Flows From Financing Activities Proceeds from notes payable to related parties ~~49,246~~- - ~~202~~153,~~196~~950 Proceeds from notes payable - - - Proceeds from sale of common stock 820,~~046~~074 ~~160~~453,~~792~~917 ~~641~~653,~~707~~735 Proceeds from sale of flow-through shares 94115,~~584~~206 - ~~204~~224,~~223~~845 Proceeds from sale of convertible debentures - - 1,137,581 Loans from related parties -69,866 3448,~~636~~496 39109,~~482~~348 Payments on convertible debentures - (424,~~836~~055) (24,071) Payments on Notes Payable - - - Payments on notes payable to related parties (1727,~~438~~214) -(1,925) (2736,~~121~~897) --------------------- ----------------- --------------------- Net Cash Provided by Financing Activities ~~134~~177,~~438~~932 ~~190~~476,~~592~~433 2,~~174~~218,~~997~~491 Foreign currency effect on cash ~~(81)~~1,240 228,~~102~~190 2022,~~986~~307 Net Increase (Decrease) in Cash and Cash (47,~~383~~128) ~~(195)~~34,675 75,~~879~~134 Cash and Cash Equivalents, beginning balance 12,262 195 - --------------------- ----------------- --------------------- Cash and Cash Equivalents, ending balance $ 75,~~879~~134 $ 34,870 $ 5,134 =================== ================= ===================== The accompanying notes are an integral part of these statement F-6 ECOTECH ENERGY GROUP INC. (A Development Stage Company) CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Continued) Supplemental Disclosure of Cash Flow Information Cash paid for: Interest $ 7,~~879~~715 $ - $ 12,486 ==================== ================ ===================== Income taxes $ - $ - $ - ==================== ================ ===================== Supplemental Disclosure of Non-cash Investing and Financing Activities Fair value of beneficial conversion feature of convertible debentures $ - $ - $ 544,307 ==================== ================ ===================== Conversion of debentures into common stock $ - $ - $ 1,116,391 ==================== ================ ===================== Premium on flow-through shares $ - $ - $ 36,306 ==================== ================ ===================== Shares issued to extinguish debt $ - $ - $ 99,138 ==================== ================ ===================== Accounts payable settled through the issuance of stock $ 34,878 $ - $ 133,291 ==================== ================ ===================== Note payable issued to acquire land $ 204,760 $ - $ 204,760 ==================== ================ ===================== The accompanying notes are an integral part of these statements. F-67

ECOTECH ENERGY GROUP INC. (A Development-Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2011 (Unaudited) 1. BUSINESS We are a development-stage renewable energy company which plans to manufacture biomass-fuelled combined heat and power (CHP) stations that produce renewable and sustainable "green" energy products. Over the past 30 years, ecoTECH Energy Group, Inc. ("ecoTECH") executives have developed and refined a "proprietary thermal gasification" technology to create clean-burning waste-to-energy cogeneration Power Stations. This combined heat and power (CHP) technology produces: (i) electricity, which can be channeled to utilities and end-users via the electrical infrastructure grid (the "Grid"); and (ii) heat which can be used to fuel a torrefied biomass briquette manufacturing facility, allowing for a "green-fuel" offering and related revenue stream. ecoTECH will specialize in the development and operation of CHP Power Stations and intends to build five CHP Power Stations in North American in the next five to seven years. In March 2011, the Company acquired land which it intends to utilize to build its first production plant if construction and equity capital is raised by management. During April 2011, the Company established an operating division in Montana to engage in operations across the state to manufacture biomass energy and grow / distribute our horticulture products. We have hired three new members to ecoTECH's management team to head-up the Montana division. Also during April 2011, we entered into a Memorandum of Understanding ("MOU") with Wayzata Investment Partners, LLC ("Wayzata") to negotiate a purchase agreement with Thompson River Power, LLC ("TRP") and its manager, Wayzata, for the acquisition of 100% of the equity interests in TRP. The Company has entered into a Due Diligence Phase related to this MOU, and hopes to solidify it into a binding agreement once completed. 2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited interim consolidated financial statements of ecoTECH 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, and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Form 10-K filed with the SEC. In the opinion of Management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and 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 our consolidated financial statements which substantially duplicate the disclosures contained in our Annual Report on Form 10-K for the year ended December 31, 2010 have been omitted. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Actual results may ultimately differ from those estimates. The significant estimates made by management relate to the estimation of the value of the Company's common stock. Changes in estimates are reported in earnings in the period in which they become known. Property, Plant and Equipment Land acquired by purchase is recorded at cost. The amount recorded includes the cost of the land, as well as any related acquisition costs. F-8 ECOTECH ENERGY GROUP INC. (A Development-Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2011 (Unaudited) Flow-Through Shares Financing The Company has financed a portion of its development-stage activities through the issue of flow-through shares, which transfer the Canadian tax deductibility of exploration expenditure to the investor. Proceeds received from the issuance of such shares are allocated between the offering of shares and the sale of tax benefits. The allocation is made based on the difference between the price of the existing shares and the amount the investor pays for the shares. A liability is recognized for the difference. Resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with the income tax legislation in Canada. On such renunciation, a deferred tax liability is created and the liability recognized at issuance reversed. The Company recognized the benefit of tax losses (based on a combined Canadian federal and provincial rate of 13.5%) to offset the deferred tax liability resulting in an income tax recovery. During the three months ended September 30, 2011, the flow through shares sold generated a current income tax benefit of $2,895, as reflected in the accompanying statements of operations and comprehensive loss. 3 GOING CONCERN The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates continuation of the Company as a going concern. The Company has incurred losses from Inception to September 30, 2011 of $33,042,977 and used cash in operating activities of $1,852,784. At September 30, 2011, the Company had limited available capital. These matters raise substantial doubt about the Company's ability to continue as a going concern. In view of these matters, realization of certain of the assets in the accompanying balance sheets are dependent upon the Company's ability to meet its financing requirements and raise additional capital, and upon the success of its future operations. The Company requires additional capital of approximately $600,000 to $1,200,000 to continue its development activities and provide working capital for general corporate purposes for the next 12 months. In addition, the Company needs to obtain financing of approximately $160,000,000 for the construction of the proposed 60 Megawatt plant. There is no assurance that our capital raising plans will be successful in obtaining sufficient funds to assure the eventual profitability of the Company. We believe that actions planned and presently being taken to revise the Company's operating and financial requirements provide the opportunity for the Company to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from these uncertainties. 4 PROPERTY, PLANT AND EQUIPMENT Acquisition of Land On March 16, 2011 our wholly owned subsidiary, ecoTECH Energy Group (Canada) Inc., completed its acquisition of a parcel of land located in McBride, British Columbia. We purchased the property from Tralee Investments Ltd for an aggregate purchase price of $257,075, of which $51,415 was paid in cash and the remaining is subject to a mortgage from the seller, which is included in notes payable on the accompanying balance sheet. There is no material relationship (other than in respect of the transaction) between us, our subsidiary purchaser and seller or any of our affiliates, or any of our directors, officers or any associate of any of our officers and directors. The mortgage is for 200,000 Canadian dollars, which translates to $200,351 as of September 30, 2011. The mortgage accrues simple interest at 8% annually, calculated monthly, but not in advance, over a two year term expiring March 15, 2013 and is secured by the land. Payments of $1,587 are due monthly, with a balloon payment at expiration. As of September 30, 2011, interest expense of approximately $8, 866 has been recorded in relationship to this note. F-9 ECOTECH ENERGY GROUP INC. (A Development-Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2011 (Unaudited) Property, plant and equipment consist of the following:

~~ECOTECH~~September ~~ENERGY~~30, ~~GROUP~~2011 ~~INC.~~December (A31, ~~Development~~2010 ~~Stage~~-------------------------------------------------------- ~~Company)~~Land ~~CONSOLIDATED~~$ ~~STATEMENTS~~257,075 OF$ ~~CASH~~- ~~FLOWS~~Computer ~~(Unaudited)~~hardware ~~(Continued)~~110,458 ~~Supplemental~~110,458 ~~Disclosure~~Computer ofsoftware ~~Cash~~23,904 ~~Flow~~23,904 ~~Information~~Furniture ~~Cash~~and ~~paid~~fixtures ~~for:~~20,043 ~~Interest~~20,043 $Equipment -33,463 $33,463 -Leasehold $improvements 4139,~~771~~600 ~~====================~~139,600 ~~================~~Website ~~=====================~~14,463 ~~Income~~14,463 ~~taxes~~Less $accumulated depreciation (204,354) (161,892) -------------------------------------------------------- Total property, plant and equipment, net $ -394,652 $ -180,039 ==================== ================ ===================== ~~Supplemental~~Depreciation ~~Disclosure~~expense offor ~~Non-cash~~the ~~Investing~~three and ~~Financing~~nine-months ~~Activities~~ended ~~Fair~~September ~~value~~30, of2011 ~~beneficial~~and ~~conversion~~2010 ~~feature~~and offor ~~convertible~~the ~~debentures~~period $from -Inception $to -September ~~$ 544~~30,~~307~~ ~~====================~~2011 ~~================~~was ~~=====================~~$16,840, ~~Conversion~~$21,943 ~~of debentures into common stock~~ $50,553, - $50,269, -and $ 1197,~~116~~698,~~391~~ ~~====================~~respectively. ~~================~~5 ~~=====================~~ACCRUED ~~Premium~~LIABILITIES onAccrued ~~flow-through~~liabilities ~~shares~~by $major -classification $are -as $follows: 36September 30,~~306~~ ~~====================~~2011 ~~================~~December ~~=====================~~31, ~~Shares~~2010 ~~issued~~------------------------- to--------------------------- ~~extinguish~~Accrued ~~debt~~interest $ -19,209 $ ~~- $ 99~~18,~~138~~832 ~~====================~~Accrued ~~================~~wages ~~=====================~~and ~~Accounts~~payroll ~~payable~~taxes ~~settled~~1,863,438 ~~through~~1,302,381 ~~the~~Accrued ~~issuance~~consulting offees ~~stock~~311,600 ~~$ 34~~275,~~878~~000 $------------------------- --------------------------- $Total ~~133,291~~accrued ~~====================~~liabilities ~~================ ===================== Note payable issued to acquire land~~ $ ~~204~~2,~~760~~194,247 $ ~~- $ 204~~1,~~760~~596,213 ==================== ===== =========== ================~~===== The accompanying notes are an integral part of these statements. F-7~~

Accrued liabilities balances reflected above include interest accrued on note payable and convertible debenture balances outstanding, accrued payroll and related payroll taxes, accrued fees due to an external consulting firm, and the flow-through share premium liability which represents a premium payment paid by investors for shares of common stock purchased under a tax-advantage program. The Company must record this premium until they comply with the provisions of the Canada Revenue Agency ("CRA") program by submitting an annual form containing eligible expenses submitted for tax exemption, thus renouncing the tax benefit. 6 NOTES PAYABLE TO RELATED PARTIES On February 5, 2009, the Company borrowed $99,137 from a shareholder for operating capital, and agreed to repay the principal plus 10% annual interest in 90 days. On September 8, 2009, the note was amended to pay interest at 20% interest per annum and matured in 90 days. Upon default, the note continues to earn 20% per annum. On November 1, 2010, the note holder converted the principal balance into 312,500 shares of private company common stock (pre-acquisition). The Company has paid $9,707 of the $27,959 interest accrued on the note. Accrued interest of $19,251 remains to be paid as of September 30, 2011. The Company borrowed from a shareholder for operating capital. This loan is non-interest bearing and does not have a specific maturity date. Management did not impute interest as such amount was not deemed significant. See Note 9 for additional related party transactions. F-10 ECOTECH ENERGY GROUP INC. (A Development-Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2011 (Unaudited) 7 COMMITMENTS AND CONTINGENCIES Operating Leases The Company leases office space in Langley, British Columbia, Canada. The office lease became effective on April 1, 2008 and is for a term of five years. Basic rent for the first three years is $4,794. Basic rent for the last two years increases approximately 7% to $5,113 per month. In addition to basic rent and applicable taxes, the Company will also be responsible for varying operating expenses (HVAC, assessments, utilities and service charges, licenses and permits) as they arise. The Company leases an automobile, under a four-year term agreement, for use by one of its directors, with current lease payments of $1,239 per month. Actual office rent expense, including all applicable taxes and operating costs, for the three and nine-months ended September 30, 2011 and 2010 and the period from Inception to September 30, 2011 were $25,537, $21,932, $73,684, $66,024, and $325,677, respectively. Litigation The Company is involved in claims and litigation from time to time in the normal course of business. Management of the Company believe there are no matters pending that are expected to have a material adverse effect on the business of the Company, their financial condition, results of operations or cash flows. 8 STOCKHOLDERS' DEFICIT Issuance of Stock On January 4, 2011, the Company satisfied a $5,037 accounts payable balance by issuing 18,518 shares of common stock of ecoTECH Energy Group, Inc. to a utility company, based on a stock price of approximately $0.27 per share. These shares contain an 18 month restriction from the date of issuance. During February 2011, the Company raised $8,046 through the sale of 29,366 shares common stock via subscription agreements sold to three investors, based on a stock prices between $0.25 and $0.32 per share. During February 2011, the Company established a private equity offering to Canadian investors to raise operating capital. The offering was for "CRCE Flow-Through Shares" of common stock, whereas CRCE is defined under section 1219 of the Income Tax Regulations as "Canadian Renewable and Conservation Expense" for the purposes of subsection 66.1(6) of the Canadian Income Tax Act..CRCE is included in calculating Canadian Exploration Expense and is eligible to be renounced under a flow-through share agreement. Investment in these shares allows for specific income tax benefits for Canadian individual filers, in which specific expenses incurred by the Company is passed through to these investors to recognize (pro-rated) on their individual Canadian income tax returns. During March 2011, the Company raised $86,926 through the sale of 169,288 shares common stock via subscription agreements sold, under guidelines of the Canadian Renewable Conservation Expense program ("CRCE") to six investors, based on a stock price of approximately $0.51 per share, for which $13,093 in commissions were paid relative to the sale of this stock. In accordance with the sale of CRCE "flow through shares", the Company recognized an income tax credit of $11,582 at March 31, 2011, on the accompanying statement of operations contained herein. During April and May 2011, the Company raised $22,839 though the sale of 44,000 shares of common stock via subscription agreements sold under the guidelines of the CRCE program to three investors, based on a stock price of approximately $0.52 per share, for which $2,088 in commissions were paid relative to the sale of this stock. In accordance with the sale of CRCE "flow through shares", the Company recognized an income tax credit of $2,970 at September 30, 2011, on the accompanying statement of operations and comprehensive loss contained herein. F-11 ECOTECH ENERGY GROUP INC. (A Development-Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2011 (Unaudited) On May 1, 2011 the Company issued 750,000 shares to a director of the Company for prior services rendered. These shares were valued based on the stock price of $0.40 per share and charged to operations. In addition, on May 10, 2011 in connection with an employment arrangement, the board of directors approved the issuance of 2,000,000 shares of the Company's common stock over a period of 18 months to its Chief Financial Officer. In connection therewith, Company issued 500,000 fully-vested shares of common stock to the officer based on a stock price of $0.45 per share, the estimated grant-date fair value on May 10, 2011. The remaining 1,500,000 shares, valued at the grant-date fair value of $675,000, cliff vest evenly on November 10, 2011, May 10, 2012 and November 10, 2012, and will be amortized to expense over the period of 18 months. During the nine-months ended September 30, 2011, the Company recognized aggregate stock-based compensation expense in the amount $697,500 for the above services which is included in general and administrative expenses. On May 31, 2011, the Company satisfied a $29,841 accounts payable balance by issuing 64,785 shares of common stock of ecoTECH Energy Group, Inc. to a utility company, based on a stock price of approximately $0.45 per share. These shares contain an 18 month restriction from the date of issuance. During August and September 2011, the Company raised $21,230 though the sale of 42,000 shares of common stock via subscription agreements sold under the guidelines of the CRCE program to two investors, based on a stock price of approximately $0.51 per share, for which $1,003 in commissions were paid relative to the sale of this stock. In accordance with the sale of CRCE "flow through shares", the Company recognized an income tax credit of $2,835 at September 30, 2011, on the accompanying statement of operations and comprehensive loss contained herein. During the three-month period from July to September 2011, the Company raised $12,157 through the sale of 32,353 shares common stock via subscription agreements sold to four investors, based on stock prices between $0.20 and $0.43 per share. Stock based compensation expense for the three and nine-months ended September 30, 2011 and 2010 and for the period from Inception to September 30, 2011 was $112,500, $0, $697,500, $14,929,920, and $25,519,452, respectively. Foreign Currency Translation The exchange rates used to translate amounts in Canadian Dollars ("CAD$") into U.S. Dollars ("US") for the purposes of preparing the consolidated financial statements were as follows: As of September 30, 2011 and December 31, 2010, the Company used the period-end rates of exchange for assets and liabilities of CAD$1 to US$0.9682 and CAD$1 to US$1.0015, respectively. For the nine months ended September 30, 2011 and 2010, the Company used the period's average rate of exchange to convert revenues, costs, and expenses of CAD$1 to US$1.0230 and CAD$1 to US$0.9622, respectively. F-12 ECOTECH ENERGY GROUP INC. (A Development-Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2011 (Unaudited) 9 RELATED PARTY TRANSATIONS Related-Party Payables Related party payables represent balances in accounts payable that are owed to directors and shareholders. These payables are primarily for unreimbursed travel and entertainment expenses incurred on behalf of the Company. The respective parties have agreed to defer these payables, interest-free, until a time at which the Company has raised sufficient capital. Accrued Wages Due to capital restraints, management has deferred certain of their monthly salaries until capital is available. Although there are no employment agreements, the Chief Executive Officer earns $18,000 per month; The Chief Operating Officer earns $10,000 per month; the Executive Vice President of Business Development earns $10,000 per month; the Executive Vice President of Engineering earns $10,000 per month, and the Vice President of Administration earns $10,000 per month. Shareholder Loans From time to time, the four founding directors loaned money to the Company for general operating capital. These loans are repaid to the respective directors when additional capital is raised. Due to the short-term nature of these loans, the officers/directors agreed that they would not be interest bearing, and are due upon demand. Shareholder loans are included in notes payable to related parties on the accompanying balance sheet. Net proceeds from shareholder loans during the nine-months ended September 30, 2011 were $42,652. 10 SUBSEQUENT EVENTS Issuances of Stock During October 2011, we sold 15,625 common shares of common stock to one investor for a cash payment of $5,000. On October 26, 2011 the Board of Directors passed a resolution to issue 2,900,000 common shares of common stock as stock based compensation at a value of $.45 per share. F-13 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS The following information and discussion should be read in conjunction with such consolidated financial statements and notes thereto. Additionally, this Management's Discussion and Analysis of Financial Condition and Results of Operation contains certain statements that are not strictly historical and are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a high degree of risk and uncertainty. Actual results may differ materially from those projected in the forward-looking statements due to other risks and uncertainties that exist in the Company's operations, development efforts and business environment, the other risks and uncertainties described in the section entitled "Cautionary Note Regarding Forward-Looking Statements" at the front of this Report on Form 10-Q, and our "Risk Factors" section herein. All forward-looking statements included herein are based on information available to the Company as of the date hereof, and the Company assumes no obligation to update any such forward-looking statement. CORPORATE HISTORY We were incorporated under the laws of the State of Nevada on November 16, 2005 under the name "Sea 2 Sky Corporation". We were initially established to provide travel related services to tourists in Canada and other countries. Due to an economic downturn, we abandoned the travel service business in the first half of fiscal 2009. Accordingly, results from operations related to the travel business have been reclassified from current operations to that of discontinued operations for proper financial presentation. Effective March 1, 2009, we transitioned our business focus to that of a world-wide renewable energy provider, and became a development-stage company that intended to obtain sources of biomass supply streams and convert them into green or alternative energy products. On November 12, 2010, pursuant to the terms of a business combination agreement, we acquired 100 percent of the issued and outstanding common stock of ecoTECH (Canada), Inc. for approximately 110 million shares of our common stock, which were distributed to the shareholders of the acquired company. ecoTECH (Canada) was amalgamated with 7697112 Canada Corp., a federally incorporated company that was our wholly owned subsidiary, and as a result of this amalgamation, ecoTECH (Canada) became our wholly owned subsidiary. ecoTECH (Canada) has no subsidiaries and is not a reporting issuer in any jurisdiction of Canada or the United States. This common stock transaction, which represented a majority of the then issued and outstanding shares of Sea 2 Sky Corporation, constituted a change in control of the Company. As such, on December 20, 2010, Sea 2 Sky Corporation changed its name to ecoTECH Energy Group Inc. and its trading symbol to "ECTH". Furthermore, upon close of the acquisition, the Company changed its fiscal year-end to December 31. OUR BUSINESS Our business will encompass development activities culminating in the construction and long-term operation of biomass energy production plants. As such, we are currently in the stage of finding suitable locations, securing proper financing for building plants, and deploying project opportunities for converting woody biomass feedstock into torrefied bio-energy products such as electricity via gasification process, activated carbon, and "green coal" via pelletization process. As we build these plants, we intend to increase our number of employees appropriately. The Company intends to strategically position multiple CHP Power Stations in order to: o Reduce the reliance on fossil fuels by providing a sustainable and environmentally friendly source of energy and fuel products manufactured from local biomass feed-stocks; o Meet specific local needs for decentralized power, while reducing the cost of biomass transportation; o Assist communities to meet federal and state renewable energy and reduced emissions mandates; and, o Provide local jobs and community development for the project communities. Long-term markets and goals have been identified for each of our projects, designed to fulfill corporate, investor and shareholder requirements. These can be summarized as follows: 14 Renewable Energy Production and Sales: CHP Power Stations are modular units built in chains to meet specified power needs of the community or communities. Combined heat and power are produced in variable ratios, depending on the application. Local fiber availability and transmission bandwidth are two limiting factors when determining total capacity to construct. Hence, a Power Station is expandable and flexible to changing environments. Each Power Station project brings baseline income for two to three decades. Power supply purchase agreements run from five to thirty years, and we generally expect a return on investment circa 25%, being unaffected by market trends. Green Fuel Production: Torrefied Briquettes, "Green-fuel", production allows an alternative to coal-fired energy manufacturers in order to meet renewable energy mandates by established deadlines. When wood is roasted ("torrefied"), it becomes brittle at a certain temperature and takes on the attributes of coal, with the exceptions that it provides greater heat energy by weight, is sustainably renewable, and meets the mandated criteria. We intend to use surplus heat generated by the Power Stations to provide this torrefaction process to woody biomass, which is then formed into briquettes to be sold at respectable margins on long-term fuel supply contracts with coal-fired power stations. This allies our efforts with the existing coal power giants, where helping them gives access to transmission facilities that would not be afforded a competitor. Our projections indicate this business segment offers a return on investment (ROI) of approximately 20%. Ancillary Operations: Food Production Projects are interrelated self-contained businesses that can evolve around the Power Stations, utilizing the surfeit of energy by-products to support local hydroponic greenhouses and aquaculture fish facilities. PLAN OF OPERATIONS The Company requires an additional capital of approximately $600,000 to $1,200,000 to continue its development activities and provide working capital for general corporate purposes for the next 12 months. In addition, the Company needs to obtain financing of approximately $160,000,000 for the construction of the proposed 60 Megawatt plant. There is no assurance that our capital raising plans will be successful in obtaining sufficient funds to assure the eventual profitability of the Company. Currently, our development stage operations have been funded through the sale of our common stock. We plan to raise additional funds through Federal and State grants, loan guarantees, and project debt financings or through future sales of our common stock, until such time as our revenues are sufficient to meet our cost structure, and ultimately achieve profitable operations. There is no assurance that we will be successful in raising additional capital or achieving profitable operations. Our consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. McBride, British Columbia, Canada --------------------------------- On March 16, 2011, we finalized the purchase of land for the planned first plant location in McBride, British Columbia. The land will be used for one of the Company's biomass energy production plants along with hydroponic greenhouses and fish propagation facilities, scheduled for start of construction late spring 2012 During the following months, the Company plans to fund the construction of its first CHP Power Station projects in McBride, British Columbia, Canada, through debt financing (acquired, subject to successful due diligence) and private placement equity funding, obtaining the estimated $160 million in capital required for completion of this two-phase project. Through proprietary thermal gasification technology, this plant is expected to create a total of 60 MW/hour of electricity which can be channeled via the Grid to utilities and end-users; and heat which can be used to fuel ancillary operations such as large scale 15 (four-hectare) hydroponic greenhouses, and food fish propagation facilities. The Company has already secured long-term large-tonnage biomass fuel source agreements to fuel the plants. Montana ------- During April 2011, after receiving endorsement by the Governor's office of Economic Development, the Company established an operating division in Montana to engage in operations across the state to manufacture biomass energy and grow / distribute our horticulture products. Also during April 2011, we entered into a Memorandum of Understanding ("MOU") with Wayzata Investment Partners, LLC ("Wayzata") to negotiate a purchase agreement with Thompson River Power, LLC ("TRP") and its manager, Wayzata, for the acquisition of 100% of the equity interests in TRP. The Company has entered into a Due Diligence Phase related to this MOU, and hopes to solidify it into a binding agreement once completed. During fiscal 2010, we signed a letter of intent agreement with the Northern Cheyenne Tribe of Montana to negotiate and enter into definitive agreements for the location and operating of a 36MW biomass fuelled power-plant on certain fee lands adjacent to the Northern Cheyenne Reservation. The agreement would provide for political and economic support, reservation biomass, labor contracting, land and water rights and many other mutual benefits. COMPARISON OF OPERATING RESULTS RESULTS OF OPERATION FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2011 COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 2010 Revenues We had no revenue for the three months ended September 30, 2011 and 2010. The lack of revenue in both periods is a direct reflection of the change of control and introducing a new focus and business plan. We do not intend to generate revenue in the near future until our business plan goals have been met. General and Administrative Expense Our general and administrative expenses increased to $416,944 for the three months ended September 30, 2011, from $302,831 for the comparable period in 2010. The increase during the three months ended September 30, 2011 was primarily attributable to the increase in stock based compensation of $112,500. Interest Expense Our interest expense increased to $13,515 for the three month period ended September 30, 2011, from $4,774 for the comparable period during 2010. This increase is attributable to increased borrowings during the period. Loss from Operations Our net loss from operations increased to $416,944 for the three months ended September 30, 2011, from $302,831 for the comparable period in 2010. The increase was primarily attributable to the increase in stock compensation expense of $112,500. RESULTS OF OPERATION FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 2010 Revenues We had no revenue for the nine months ended September 30, 2011 and 2010. The lack of revenue in both periods is a direct reflection of the change of control and introducing a new focus and business plan. We do not intend to generate revenue in the near future until our business plan goals have been met. 16 General and Administrative Expenses Our general and administrative expenses decreased to $1,744,304 for the nine months ended September 30, 2011, from $15,675,710 for the comparable period in 2010. The decrease during the nine months ended September 30, 2011 was primarily attributable to a decrease in stock-based compensation of $14,232,420, offset by an increase of $37,723 in engineering and consulting costs incurred in connection with preparing the business plan for BC Hydro Phase II on the McBride British Columbia project, an increase of $269,491 in wages for an increase of four employees relative to pursuing the new business focus, and an increase of $56,943 in legal and audit costs inherent to public companies. Interest Expense Our interest expense increased to $36,245 for the nine month period ended September 30, 2011, from $23,788 for the comparable period during 2010. This increase is attributable to increased borrowings during the period. Loss from Operations Our net loss from operations decreased to $1,761,741 for the nine months ended September 30, 2011, from $15,675,710 for the comparable period in 2010. The decrease during the nine months ended September 30, 2011 was primarily attributable to the reduction of share based compensation of $14,232,420 between the two periods. Absent of stock compensation, current period's general and administrative expenses actually increased by $301,014, as described above. LIQUIDITY AND CAPITAL RESOURCES We had total assets of $430,888 as of September 30, 2011, consisting of, $394,652 in net fixed assets, $21,547 in deposits, $6,602 in prepaid expenses, and $2,953 in other receivables. We had a working capital deficit of $3,068,073. We had total liabilities of $3,276,402 as of September 30, 2011, consisting of $3,082,762 in current liabilities, which included $654,249 of accounts payable; accrued wages of $1,863,438; $311,600 in accrued consulting fees; $19,209 in accrued interest; and short term debt of $234,266 to related parties. We had long term liabilities consisting of a land mortgage for $193,640. We had a total stockholders' deficit of $2,845,516 as of September 30, 2011, and an accumulated deficit as of September 30, 2011 of $33,278,405. We had $134,885 in net cash used in operating activities for the nine months ended September 30, 2011, which included $1,780,353 in net loss and $17,628 income tax benefit on flow-through shares which was offset by $50,553 in depreciation; $697,500 in stock-based compensation; $210,447 in accounts payable; $665,548 in accrued liabilities; $38,555 in deposits, and $493 in prepaid expenses. This represents a decrease in cash used of $325,791 over prior year's comparable period, which is primarily attributable to the increase in accounts payable balances and accrued salaries due to limited funds being available in the current period. We had $51,415 in net cash used by investment activities, to purchase land, during the nine months ended September 30, 2011. This represents an increase cash used in investment activities over prior year's comparable period due to the purchase of land in the current period. We had $177,932 of net cash provided by financing activities for the nine months ended September 30, 2011, which included $20,074 in proceeds from the sale of common stock and $115,206 in proceeds from the sale of flow-through shares; and $42,652 in net proceeds from notes payable by related parties. On March 16, 2011, we acquired land of which $204,760 was financed through a two year note at 8%. Since we have no liquidity and have suffered losses, we depend to a great degree on the ability to attract external financing in order to conduct our business activities and in order that we have sufficient cash on hand to expand our operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. If we are unable to raise additional capital from 17 conventional sources, including increases in related party loans and/or additional sales of additional stock, we may be forced to curtail or cease our operations. Even if we are able to continue our operations, the failure to obtain financing could have a substantial adverse effect on our business and financial results. We have no commitments to provide us with financing in the future, other than described above. Our independent registered public accounting firm included an explanatory paragraph raising substantial doubt about the Company's ability to continue as a going concern. In the future, we may be required to seek additional capital by selling debt or equity securities, selling assets, or otherwise be required to bring cash flows in balance when it approaches a condition of cash insufficiency. The sale of additional equity securities, if accomplished, may result in dilution to our shareholders. We cannot assure you, however, that financing will be available in amounts or on terms acceptable to us, or at all. CRITICAL ACCOUNTING POLICIES AND ESTIMATES The preparation of the Company's financial statements in conformity with generally accepted accounting principles in the United States requires management to make assumptions and estimates that affect the reported amounts of assets, liabilities, revenues and expenses as well as the 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. The following is a summary of the significant accounting policies and related estimates that affect the Company's financial disclosures. Foreign Currency Translations The functional currency is the Canadian dollar and the reporting currency is the U.S. dollar. At each balance sheet date, assets and liabilities that are denominated in a currency other than U.S. dollars are adjusted to reflect the current exchange rate which may give rise to a foreign currency translation adjustment accounted for as a separate component of shareholders' equity and included in other comprehensive loss. Revenues and expenses are translated at the average daily rate for the year covering the financial statement year to approximate the rate of exchange on the transaction date. Exchange gains and losses are included in the determination of net income (loss) for the period. Off-Balance Sheet Arrangements We currently do not have any off-balance sheet arrangements. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item. ITEM 4. CONTROLS AND PROCEDURES (a) Evaluation of disclosure controls and procedures. Our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q (the "Evaluation Date"), have concluded that as of the Evaluation Date, our disclosure controls and procedures were not effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the 18 Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In March 2011 our Independent Registered Public Accounting firm identified a lack of a formal review process for account reconciliations and complex accounting and reporting matters which increases the risk that errors or omissions exist and go undetected by management. The Company will continue to take steps to identify matters of accounting and disclosure. (b) Changes in internal control over financial reporting. There were no changes in our internal control over financial reporting during our most recent fiscal quarter that materially affected, or were reasonably likely to materially affect, our internal control over financial reporting. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. INHERENT LIMITATIONS OF INTERNAL CONTROLS Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with the U.S. GAAP. Our internal control over financial reporting includes those policies and procedures that: o pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; o provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with the U.S. GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and o provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the consolidated financial statements. Management does not expect that our internal controls will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of internal controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Also, any evaluation of the effectiveness of controls in future periods are subject to the risk that those internal controls may become inadequate because of changes in business conditions, or that the degree of compliance with the policies or procedures may deteriorate. Part II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS To the best of our knowledge, there are no known or pending litigation proceedings against us. ITEM 1A. RISK FACTORS As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this item. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS During the period of July 1, 2011 through September 30, 2011, the Company made the following unregistered issuances of its equity. 19 On May 1, 2011 the Company issued 750,000 shares to a director of the Company based on a stock price of $0.40 per share. In addition, on May 10, 2011 in connection with an employment arrangement, the board of directors approved the issuance of 2,000,000 shares of the Company's common stock over a period of 18 months to its Chief Financial Officer. In connection therewith, Company issued 500,000 fully-vested shares of common stock to the officer based on a stock price of $0.45 per share, the estimated grant-date fair value on May 10, 2011. The remaining 1,500,000 shares, valued at the grant-date fair value of $675,000, vest evenly on November 10, 2011, May 10, 2012 and November 10, 2012, and will amortized to expense over the period of 18 months. During the quarter ended September 30, 2011, the Company recognized stock based compensation expense in the amount $112,500. During August and September 2011, the Company raised $21,230 through the sale of 42,000 shares common stock via subscription agreements sold under the guidelines of the Canadian Renewable Conservation Expense program ("CRCE") to two investors, based on a stock price of approximately $0.51 per share, for which $1,003 in commissions were paid relative to the sale of this stock. In accordance with the sale of CRCE "flow through shares", the Company recognized an income tax credit of $2,835 at September 30, 2011, on the accompanying statement of operations contained herein. During the three month period from July to September 2011, the Company raised $12,157 through the sale of 32,353 shares common stock via subscription agreements sold to four investors, based on stock prices between $0.20 and $0.43 per share. Exemption From Registration Claimed All of the above sales by the Company of its unregistered securities were made by the Company in reliance upon Section 4(2) of the Securities Act of 1933, as amended (the "1933 Act"). All of the individuals and/or entities that purchased the unregistered securities were known to the Company and its management, through pre-existing business relationships. All purchasers were provided access to all material information, which they requested, and all information necessary to verify such information and were afforded access to management of the Company in connection with their purchases. All purchasers of the unregistered securities acquired such securities for investment and not with a view toward distribution, acknowledging such intent to the Company. All certificates or agreements representing such securities that were issued contained restrictive legends, prohibiting further transfer of the certificates or agreements representing such securities, without such securities either being first registered or otherwise exempt from registration in any further resale or disposition. ITEM 3. DEFAULT UPON SENIOR SECURITIES None. ITEM 4. (REMOVED AND RESERVED) ITEM 5. OTHER INFORMATION None Item 6. Exhibits (a) Pursuant to Item 601 of Regulation S-K, the following exhibits are included herein.

~~June~~Item ~~30,~~No. ~~2011~~Description ~~December~~Method ~~31,~~of ~~2010~~Filing ------------------ ------------------------------------------------------------------------------------------------- ~~Land~~31.1 $Certification ~~257,075~~of $Chief Executive Officer pursuant to Rule 13a-14(a) ~~Computer~~Filed ~~hardware~~herewith. ~~110,458~~31.2 ~~110,458~~Certification ~~Computer~~of ~~software~~Chief ~~23,904~~Financial ~~23,904~~Officer ~~Furniture~~pursuant ~~and~~to ~~fixtures~~Rule ~~20,043~~13a-14(a) Filed herewith. 20~~,043~~ ~~Equipment~~32.1 ~~33,463~~Chief ~~33,463~~Executive ~~Leasehold~~Officer ~~improvements~~Certification ~~139,600~~pursuant ~~139,600~~to ~~Website~~18 ~~14,463~~U.S.C.ss.1350 ~~14,463~~adopted ~~Less~~pursuant ~~accumulated~~to ~~depreciation~~Section 906 of the Sarbanes Oxley Act of 2002 Filed herewith. 32.2 Chief Financial Officer Certification pursuant to 18 U.S.C.ss.1350 adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 Filed herewith. 101.INS XBRL Instance Document (~~199,225~~1) 101.SCH XBRL Taxonomy Extension Schema Document (~~161,892~~1) ~~------------------~~101.CAL ~~---------------------~~XBRL ~~Total~~Taxonomy ~~property,~~Extension ~~plant~~Calculation ~~and~~Linkbase ~~equipment~~Document (1) 101.DEF XBRL Taxonomy Extension Definition Linkbase Document (1) 101.LAB XBRL Taxonomy Extension Label Linkbase Document (1) 101.PREXBRL Taxonomy Extension Presentation Linkbase Document (1) (1) Pursuant to Rule 406T of Regulation S-T, ~~net~~this $interactive ~~399~~data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933,~~781~~ $is ~~180~~deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934,~~039~~ ~~==================~~and ~~=====================~~otherwise is not subject to liability under these sections.

21 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ECOTECH ENERGY GROUP INC. November 21, 2011 /s/ Colin V. Hall ----------------- Colin V. Hall Chairman Principal Executive Officer November 21, 2011 /s/ Barry Sheahan --------------------------- Barry Sheahan Chief Financial Officer Principal Accounting Officer 22

June 30, 2011 December 31, 2010 -------------------------- ------------------------ Accrued interest $ 24,161 $ 18,832 Accrued wages and payroll taxes 1,758,490 1,302,381 Accrued consulting fees 311,600 275,000 -------------------------- ------------------------ Total accrued liabilities $ 2,094,251 $ 1,596,213 ========================== ========================

Item No. Description Method of Filing ------------------------------------------------------------------------------------------------- ------------------ 31.1 Certification of Colin V. Hall pursuant to Rule 13a-14(a) Filed herewith. 31.2 Certification of Barry Sheahan pursuant to Rule 13a-14(a) Filed herewith. 32.1 Chief Executive Officer Certification pursuant to 18 U.S.C.ss.1350 adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 Filed herewith. 32.2 Chief Financial Officer Certification pursuant to 18 U.S.C.ss.1350 adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 Filed herewith. 101.INS XBRL Instance Document (1) 101.SCH XBRL Taxonomy Extension Schema Document (1) 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document (1) 101.DEF XBRL Taxonomy Extension Definition Linkbase Document (1) 101.LAB XBRL Taxonomy Extension Label Linkbase Document (1) 101.PREXBRL Taxonomy Extension Presentation Linkbase Document (1)

Filing Compare · ecoTECH Energy Group Inc.