U.S. 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 ~~June~~September 30, 2010

¨ 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: 000-50173

Superior Oil and Gas Co.

(Exact name of registrant as specified in its charter)

NEVADA

(state of

incorporation)

87-0537621

(IRS Employer

I.D. Number)

844 South Walbaum Road

Calumet, Ok 73014

405-884-2080

(Address and telephone number of registrant's principal

executive offices and principal place of business)

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

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

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

As of ~~August~~November 1422, 2010, there were 199,700,000 shares of the Registrant's Common Stock, par value $0.001 per share, outstanding.

TABLE OF CONTENTS

		Page

PART I - FINANCIAL INFORMATION		3

Item 1. Financial Statements		3

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		11

Item 4. Controls and Procedures		13

PART II - OTHER INFORMATION		14

Item 1. Legal Proceedings		14

Item 2. Unregistered Sales of Equity Securities		15

Item 6. Exhibits		16

SIGNATURES		17

PART I - FINANCIAL INFORMATION

Item 1.

Financial Statements

	~~PAGE~~	PAGE
Balance Sheets June 30, 2010 and December 31, 2009 (Unaudited)	4
Balance Sheets September 30, 2010 and December 31, 2009 (Unaudited)		4
Statements of Operations for the Three Months and Six Months Ended June 30, 2010 and 2009 (Unaudited)	5
Statements of Operations for the Three Months and Nine Months Ended
Statements of Cash Flows for the Six Months Ended June 30, 2010 and 2009 (Unaudited)	6
September 30, 2010 and 2009 (Unaudited)		5
Notes to Financial Statements	7
Statements of Cash Flows for the Nine Months Ended
September 30, 2010 and 2009 (Unaudited)		6
Notes to Financial Statements		7

Superior Oil and Gas Co.

Balance Sheets

(unaudited)

	June 30,			December 31,
	2010			2009
ASSETS
Current Assets
Cash	$	32		$	218
Accounts receivable		27,222			1,616
Total Current Assets		27,254			1,834
Property and Equipment
Oil and gas properties
Pipeline Right of Way		111,600			111,600
Unproved property		-			189,581
		111,600			301,181
Other property and equipment
Leasehold improvements		553,170			553,170
Furniture and fixtures		67,714			67,714
		620,884			620,884
Less accumulated depreciation and amortization		(133,290	)		(100,795	)
		487,594			520,089
Total Property and Equipment		599,194			821,270
Total Assets	$	626,448		$	823,104
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current Liabilities
Accounts payable	$	1,415,066		$	1,438,156
Accrued salaries		323,975			323,975
Accrued interest		10,068			-
Notes payable		73,500			-
Convertible debenture payable, net of discount of $127,127		22,873			-
Debtor judgment payable		699,472			682,588
Advances from shareholders		159,655			293,528
Derivative liability		247,447			-
Total Liabilities		2,952,056			2,738,247
Shareholders' Deficit
Common stock, $0.001 par value per share
200,000,000 shares authorized, 199,700,000
outstanding at June 30, 2010 and
56,234,082 at December 31, 2009		199,700			56,235
Additional paid-in capital		15,554,734			6,485,226
Accumulated deficit		(18,080,042	)		(8,456,604	)
Total Shareholders' Deficit		(2,325,608	)		(1,915,143	)
Total Liabilities and Shareholders' Deficit	$	626,448		$	823,104

(unreviewed)

	September 30,			December 31,
	2010			2009
ASSETS
Current Assets
Cash	$	84		$	218
Accounts receivable		22,082			1,616

Total Current Assets		22,166			1,834

Property and Equipment
Oil and gas properties
Pipeline Right of Way		111,600			111,600
Unproved property		-			189,581
		111,600			301,181
Other property and equipment
Leasehold improvements		553,170			553,170
Furniture and fixtures		67,714			67,714
		620,884			620,884
Less accumulated depreciation and amortization		(149,538	)		(100,795	)
		471,346			520,089

Total Property and Equipment		582,946			821,270

Total Assets	$	605,112		$	823,104

LIABILITIES AND SHAREHOLDERS' DEFICIT

Current Liabilities
Accounts payable	$	1,430,456		$	1,438,156
Accrued salaries		323,975			323,975
Accrued interest		17,326			-
Notes payable		103,500			-
Convertible debenture payable, net of discount of $127,127		22,873			-
Debtor judgment payable		707,914			682,588
Advances from shareholders		157,134			293,528
Derivative liability		247,447			-
Total Liabilities		3,010,625			2,738,247

Shareholders' Deficit
Common stock, $0.001 par value per share
200,000,000 shares authorized, 199,700,000
outstanding at September 30, 2010 and
56,234,082 at December 31, 2009		199,700			56,235
Additional paid-in capital		15,554,737			6,485,226
Accumulated deficit		(18,159,950	)		(8,456,604	)

Total Shareholders' Deficit		(2,405,513	)		(1,915,143	)

Total Liabilities and Shareholders' Deficit	$	605,112		$	823,104

See accompanying notes to the financial statements.

Superior Oil and Gas Co.

Statements of Operations

(unaudited)

	Three						Six
	Months Ended			Months Ended			Months Ended			Months Ended
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2010			2009
Revenue
Oil	$	3,991		$	-		$	7,456		$	4,781
Gas		11,296			-			15,795			754
		15,287			-			23,251			5,535
Operating Expenses
Lease operating expenses		19,914			1,912			39,362			5,102
Impairment expense		369,371			189,885			369,371			189,885
Administrative		197,642			75,307			9,287,686			148,032
Interest		36,487			8,442			49,825			16,884
Depreciation and amortization		16,248			16,235			32,495			32,579
		639,662			291,781			9,778,739			392,482
Loss from operations		(624,375	)		(291,781	)		(9,755,488	)		(386,947	)
Loss on derivative (gain)		139,423			-			(97,447	)		-
Gain on settlement of liabilities		5,484			54,928			229,497			54,928
Loss before income taxes		(479,468	)		(236,853	)		(9,623,438	)		(332,019	)
Income taxes		-			-			-			-
Net loss		(479,468	)		(236,853	)		(9,623,438	)		(332,019	)
Basis loss per share:
Weighted average shares outstanding		199,420,628			27,234,082			142,145,550			27,234,082
Loss per share	$	(0.00	)	$	(0.01	)	$	(0.07	)	$	(0.01	)

(unreviewed)

	Three						Nine
	Months Ended			Months Ended			Months Ended			Months Ended
	September 30,			September 30,			September 30,			September 30,
	2010			2009			2010			2009

Revenue
Oil	$	3,051		$	15,593		$	18,846		$	20,374
Gas		3,409			244			10,865			998
		6,460			15,837			29,711			21,372

Operating Expenses
Lease operating expenses		5,541			10,149			44,903			15,251
Impairment expense		-			58,472			369,371			248,357
Administrative		48,881			1,734,713			9,336,567			1,882,745
Interest		15,700			8,442			65,525			25,326
Depreciation and amortization		16,248			16,235			48,743			48,814
Gain on the sale of scrap equipment		-			(23,000	)		-			(23,000	)
		86,370			1,805,011			9,865,109			2,197,493

Loss from operations		(79,910	)		(1,789,174	)		(9,835,398	)		(2,176,121	)

Loss on derivative (gain)		-			-			(97,447	)		-
Other income		-			-			229,497			54,928

Loss before income taxes		(79,910	)		(1,789,174	)		(9,703,348	)		(2,121,193	)

Deferred income tax expense (benefit)		-			-			-			-

Net loss	$	(79,910	)	$	(1,789,174	)	$	(9,703,348	)	$	(2,121,193	)

Basis loss per share:
Weighted average shares outstanding		199,700,000			33,625,386			191,564,820			47,849,555
Loss per share	$	(0.00	)	$	(0.05	)	$	(0.05	)	$	(0.04	)

See Accompanying Notes to Financial Statements

Superior Oil and Gas Co.

~~STATEMENTS~~Statements OFof ~~CASH~~Cash ~~FLOWS~~Flow

(~~UNAUDITED~~unaudited)

	Six Months			Six Months
	Ended			Ended
	June 30, 2010			June 30, 2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (loss)	$	(9,623,438	)	$	(332,019	)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Amortization of debt discount		22,873
Loss on derivative liability		97,447
Gain from settlement of accounts payable		(229,497	)		54,928
Depreciation		32,495			32,579
Impairment		369,371			189,885
Share based compensation		9,118,183			-
Changes in operating assets and liabilities:
Accounts receivable		(25,606	)		64,442
Accounts payable		145,994			(179,335	)
Accrued expenses		10,068			30,175
Debtor judgment payable		16,884			16,884
Net cash provided by operating activities		(65,226	)		(122,461	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of unproved oil & gas properties		(150,000	)		-
Net cash used in investing activities		(150,000	)		-
CASH FLOWS FROM FINANCING ACTIVITIES:
Loan from officers		(8,460	)		121,947
Proceeds from bank loan		223,500			-
Net cash provided by (used in) financing activities		215,040			121,947
NET CHANGE IN CASH FOR THE PERIOD		(186	)		(514	)
CASH AT BEGINNING OF PERIOD		218			712
CASH AT END OF PERIOD	$	32		$	198
SUPPLEMENTAL CASH FLOW DISCLOSURES
Cash paid for interest	$	-		$	-
Non Cash Investing and Financing Activities
Stock issued for oil & gas properties	$	94,790		$	-

(unreviewed)

See Accompanying Notes to Financial Statements

	Nine			Nine
	Months Ended			Months Ended
	September 30, 2010			September 30, 2009

Cash flows from operating activities:
Net loss	$	(9,703,348	)	$	(2,121,193	)

Adjustment to reconcile net loss to net cash
used in operating activities:
Amortization of debt discount		22,873
Loss on derivative liability		97,447			(54,928	)
Gain from settlement of accounts payable		(229,497	)
Depreciation and amortization		48,743			48,814
Impairment expense		369,371			248,357
Share based compensation		9,118,183			1,680,000
Changes in operating assets and liabilities:
Accounts receivable		(20,466	)		58,450
Accounts payable		161,384			(44,921	)
Accrued expenses		17,326			38,575
Increase in debtor judgment payable		25,326			25,326

Net cash used in operating activities		(92,658	)		(121,520	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of unproved oil & gas properties		(150,000	)		-
Net cash used in investing activities		(150,000	)		-

Cash flows from financing activities:
Loan from officers		(10,976	)		122,254
Proceeds from bank loan		253,500			-
		242,524			122,254

Decrease in cash		(134	)		734

Cash at beginning of period		218			712

Cash at end of period	$	84		$	1,446

SUPPLEMENTAL CASH FLOW DISCLOSURES
Cash paid for interest	$	-		$	-

Non Cash Investing and Financing Activities
Stock issued for oil & gas properties	$	94,790		$	-

See notes to the financial statements.

Superior Oil and Gas Co.

Notes to Financial Statements

(unaudited)

NOTE 1: BASIS OF PRESENTATION

The accompanying unaudited and unreviewed interim financial statements of Superior Oil and Gas Co., (the Company) have been prepared in accordance with accounting ~~principles~~ principles generally accepted in the United States of America and the rules of ~~the~~ the Securities and Exchange Commission, and should be read in conjunction with ~~the~~ the audited financial statements and notes thereto contained in Superior's ~~Annual~~ Annual Report on 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 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 substantially duplicate the disclosure contained in the audited financial statements for fiscal 2009 as reported in the Form 10-K have been omitted.

Recently Issued Accounting Pronouncements

In January 2010, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2010-06, Improving Disclosures about Fair Value Measurements (ASU 2010-06). This update provides amendments to Subtopic 820-10 and requires new disclosures for 1) significant transfers in and out of Level 1 and Level 2 and the reasons for such transfers and 2) activity in Level 3 fair value measurements to show separate information about purchases, sales, issuances and settlements. In addition, this update amends Subtopic 820-10 to clarify existing disclosures around the disaggregation level of fair value measurements and disclosures for the valuation techniques and inputs utilized (for Level 2 and Level 3 fair value measurements). The provisions in ASU 2010-06 are applicable to interim and annual reporting periods beginning subsequent to December 15, 2009, with the exception of Level 3 disclosures of purchases, sales, issuances and settlements, which will be required in reporting periods beginning after December 15, 2010. The adoption of ASU 2010-06 did not impact the Company’s operating results, financial position or cash flows, but did impact the Company’s disclosures on fair value measurements. See Note 6, “Fair Value Measurements.”

In February 2010, FASB issued ASU No. 2010-09, Amendments to Certain Recognition and Disclosure Requirements (ASU 2010-09). This update amends Subtopic 855-10 and gives a definition to SEC filer, and requires SEC filers to assess for subsequent events through the issuance date of the financial statements. This amendment states that an SEC filer is not required to disclose the date through which subsequent events have been evaluated for a reporting period. ASU 2010-09 becomes effective upon issuance of the final update. The Company adopted the provisions of ASU 2010-09 for the period ended March 31, 2010.

In April 2010, the FASB issued ASU No. 2010-12, Accounting for Certain Tax Effects of the 2010 Health Care Reform Acts (ASU 2010-12). This update clarifies questions surrounding the accounting implications of the different signing dates of the Health Care and Education Reconciliation Act (signed March 30, 2010) and the Patient Protection and Affordable Care Act (signed March 23, 2010). ASU 2010-12 states that the FASB and the Office of the Chief Accountant at the SEC would not be opposed to view the two Acts together for accounting purposes. The Company is currently assessing the impact, if any, the adoption of ASU 2010-12 will have on the Company’s disclosures, operating results, financial position and cash flows.

Superior Oil and Gas Co.

Notes to Financial Statements

(unaudited)

NOTE 2: GOING CONCERN CONSIDERATIONS

The Company neither has sufficient cash on hand nor is it generating sufficient revenues to cover its operating overhead. These facts raise substantial doubts as to the Company’s ability to continue as a going concern. The Company has been operating over the past year based on loans, stock sales, sales of oil and gas properties and increases in its accounts payable. There is no guarantee that such sources of financing will continue to be available for operations to the Company. In order to be able to complete the wells it is in the process of drilling and completing and to produce those wells, the Company will be required to obtain significant funding. Management’s plans include attempting to find partners for its drilling prospects. Management intends to make every effort to identify and develop sources of funds. There is no assurance that Management’s plans will be successful.

NOTE 3: STOCK TRANSACTIONS

On March 13, 2010, the Company issued 140 million common shares to two shareholders for compensation for past investment and for a partial interest in an oil and gas leases and three marginally producing oil and gas wells. The value was $0.065 per share or a total of $9,100,000.

All but $94,000 was for compensation of the two shareholders for their past investment in the Company. $94,000 was the fair value of the properties purchased based on replacement costs.

In order to maintain control of the Company in its present controlling shareholders, the Company is to amend its articles of incorporation (i) to increase the number of authorized shares of common stock and (ii) to authorize a new class of stock - a Preferred Stock - with a 10 million-share Series A Voting Convertible Preferred Stock, each share of which can cast 14 votes and also be convertible into 14 shares of Common Stock. The Company is expected to issue these 10 million shares to affiliates of the present management of the Company and thereby achieve a balancing of the voting power of the two shareholders mentioned above, on the one hand, and Superior's present management (and the controlling shareholder), on the other hand.

In order to maintain a balance in the voting power of the controlling shareholders and the two shareholders, in consideration of the Company’s agreeing to order the issuance of the 140 million shares of common stock to the two shareholders, the two shareholders agree that, until after the 10 million shares of Series A Preferred Stock have been authorized and issued and delivered to the owners of those shares, the two shareholders will only exercise the voting power of its shares consistent with the written instructions of the Company’s management (controlling shareholders). As a result, the issuance of the 140 million shares of common stock to the two shareholders did not result in change of control of the Company.

Superior Oil and Gas Co.

Notes to Financial Statements

(unaudited)

On April 14, 2010, the Company issued 3,765,918 shares of common stock to five persons for services. The value was $0.03 per share or a total of $112,977 based on the quoted market price of the common stock on the date of grant.

NOTE 4: NOTE PAYABLE

The note payable is a promissory note to an unrelated individual due March 31, 2011 with interest at 8% per annum.

NOTE 5: CONVERTIBLE DEBENTURE PAYABLE AND DERIVATIVE LIABILITY

On March 13, 2010 the company entered into a convertible, 15% debenture to an unrelated individual. The debenture is due with interest on October 9, 2010 and is convertible into 15 million shares of the Company’s common stock. At the date of issuance, we did not have 15 million authorized but unissued shares available and thus we could not assert that we had sufficient authorized shares to settle this share-settleable instrument if called upon by the holder. As a result of this, under ASC 815-25, the embedded conversion option should be classified as a derivative liability at its fair value.

As at the ~~six~~nine months ended ~~June~~September 30, 2010, we noted the following issued and ~~outstanding~~ outstanding shares and share-settleable instruments:

Common shares issued and outstanding			199,700,000
Common shares convertible from debenture			15,000,000
Total			214,700,000

Accordingly, at ~~June~~September 30, 2010 we still could not assert that we had sufficient ~~authorized~~ authorized shares to share-settle any conversion of the convertible debenture. As a result, the embedded conversion option should continue to be classified as a derivative liability and measured at fair value.

The valuation of our embedded derivative is determined using the Black-Scholes option pricing model. To determine the fair value of our derivatives, management evaluates assumptions regarding the probability of certain future events. Certain factors used to determine fair value include our period end stock price $0.02, historical stock volatility 338%, risk free interest rate 0.18% and derivative term 0.2 year.

NOTE 6: FAIR VALUE MEASUREMENT

FASB ASC 820, Fair Value Measurements and Disclosures defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. FASB ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. FASB ASC 820 describes three levels of inputs that may be used to measure fair value:

Superior Oil and Gas Co.

Notes to Financial Statements

(unaudited)

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Our derivative liabilities are classified as Level 2.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The following table provides a summary of the fair value of our derivative liabilities measured on a recurring basis:

	Fair value measurements on a recurring basis March 31, 2010
	Level 1		Level 2		Level 3
Liabilities
Embedded derivatives related to Convertible debentures	$	-	$	247,447	$	-

NOTE 7: IMPAIRMENT OF UNPROVED PROPERTIES

In accordance with ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets, long-lived assets such as oil and gas properties and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount of the fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheet.

Impairment of unproved oil and gas properties is determined by ASC 932, “Extractive Activities – Oil and Gas” Impairment charges on oil and gas properties in 2010 and 2009 amounted to $369,371 and $189,885, respectively.

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the financial statements and the accompanying notes thereto for the period ended ~~June~~September 30, 2010 and is qualified in its entirety by the foregoing and by more detailed financial information appearing elsewhere. See "Item 1. Financial Statements." The discussion includes management’s expectations for the future.

Such expressions of expectation are not historical in nature and are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual future results to differ materially from those expressed in any forward-looking statement. Such risks and uncertainties are discussed in the Risk Factors section of our Annual Report on Form 10-K. Copies of that filing may be obtained by contacting Gayla McCoy of our company at 844 South Walbaum Road, Calumet, OK 73014, telephone (405) 884-2080.

Results of Operations – First Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2010 Compared to the Three and ~~Six~~ Nine Months Ended ~~June~~September 30, 2009

We had oil and gas revenue of $156,~~287~~460 and $2329,~~251~~711 respectively for our interest in three oil and gas wells for the three and ~~six~~nine months ended ~~June~~September 30, 2010 compared to $015,837 and $521,~~535~~ 372 revenue for our interest in five oil and gas wells for the same periods in in 2009. All of our wells ~~were~~have been shut- in ~~late~~periodically induring ~~2008~~the periods due to lack of working capital ~~problems~~ resulting in ~~the~~uneven ~~much~~and ~~lower~~ uncomparable revenues. The inwells ~~the~~are ~~2009~~operated ~~periods~~enough ~~than in~~to ~~the~~maintain ~~2010 periods~~our leases.

Late in 2006 we drilled two oil and gas wells which were initially completed in 2007. The neutron log on the Windy Vista #1 well in Garfield County, Oklahoma indicated numerous formations which may contain oil or natural gas. Initial completion attempts on the Wilcox Formation were not commercially successful, we believe, due to a poor cement job. We have now completed the well in the Mississippi zone. That well was lost due to a legal judgment in the third quarter of 2009. The company was able to get 25% of this well back in a settlement with the owners.

Initial completion attempts in the Wilcox Formation on the Lonesome River #1 well in Blaine County, Oklahoma indicated substantial amounts of water. The well has now been completed in the Viola zone. The company also fractured the Hunton and Mississippi zones to enhance production on this well. We have only been able to get minimal production from this well and it has been shut in and the lease lost due to non-production.

We drilled the Chickie #1 and Gayla #1 wells in Logan County, Oklahoma in late 2007 and early 2008. In addition we did a recompletion on the Lindsey on the same lease during that time frame. Due to completion problems on the wells we have only been able to get minimal production on the wells.

The revenue of $521,~~535~~372 in the ~~six months~~nine months in 2009 was from our working interest from sporadic production in these wells. They were shut in most of the time due to lack of funds for operations. The revenue for oil production for the periods in 2010 was for oil produced in the Logan County wells. These wells were shut in most of the time in the first quarter of 2010 due to lack of funds necessary to pay for cost of production.

Lease operating expenses for the three and ~~six~~nine months ended ~~June~~September 30, 2010 were $195,~~914~~541 and $3944,~~362~~903 respectively compared to $110,~~912~~149 and $515,~~102~~251 respectively for the same periods in in 2009. Most of the expenditures in 2010 were for workover costs in trying to get the wells producing again.

Impairment expense in the three and ~~six~~nine months periods ended ~~June~~September 30, 2010 ~~was~~were $-0- and $369,371 respectively and for the three and ~~six~~nine months ~~period~~periods ended ~~June~~September 30, 2009 the expense was $~~189~~58,~~885~~472 and $248,357 respectively relating to ~~three~~ three leases which expired in the second quarter of 2009. The acreage ~~contained~~ contained 316 total acres of which the Company owned a 50% interest or 158 net acres.

General and administrative expenses were $~~197~~48,~~642~~881 and $9,~~287~~336,~~686~~567 respectively for the three and ~~six~~nine months ended ~~June~~September 30, 2010 compared to $751,~~307~~734,713 and $~~148~~1,~~032~~882,745 respectively for the same periods in 2009, ana ~~increase~~decrease of $~~122~~1,~~335~~685,832 ~~and~~for $9the three months ended September 30,~~139,654~~ 2010 from the same ~~three~~period in 2009 and an increase of $7,453.822 ~~six~~for ~~month~~the ~~periods~~nine months ended September 30, 2010 from the same period in 2009. The ~~increases~~decrease ~~were~~in ~~mostly~~the ~~due~~three month period in 2010 compared to ~~increases~~2009 was mostly due to the fact that there was a decrease in share based compensation offor ~~$9,005,213~~the ~~and~~2010 period. The ~~increased~~increase ~~legal~~in ~~and~~the ~~accounting fees~~nine months in 2010 ~~compared~~was mostly due to increases in share based compensation in 2010 over the same ~~periods~~period in 2009.

Interest expense was $3615,~~487~~700 and $4965,~~825~~523 respectively for in the three and ~~six~~nine months ended ~~June~~September 30, 2010 compared to $8,442 and $1625,~~584~~326 in the same periods in 2009. The ~~increases~~ increases were for interest on the $~~206~~253,~~000~~500 debentures and notes the company entered into in 2010 and to the amortization of debt discount related to the debentures.

Depreciation and amortization expense was $16,248 and $3248,~~495~~743 respectively for the three and ~~six~~ nine month periods ended ~~June~~September 30, 2010 compared to $16,235 and $3248,~~579~~814 respectively for the same periods in 2009. ~~The~~ There ~~increase~~were ~~was~~no ~~for~~changes in ~~depreciation~~depreciable onproperty ~~equipment~~between ~~and amortization~~the ofperiods ~~leasehold~~so ~~improvements~~depreciation remained virtually unchanged.

Loss on derivative in 2010 is in relation to $150,000 debentures that the company obtained in 2010. The debenture has a conversion feature in which the holder has the right to convert the debenture at $0.01 conversion price. This would result in a $97,447 loss for ~~the six months ended June 30, 2010 and a gain of $139,423~~ ~~for~~ the ~~three~~nine months ended ~~June~~September 30, 2010.

Gain on settlement of liabilities in 2010 is for the forgiveness of debt by a large shareholder during the period. In 2009 the company negotiated with three of its creditors who had liens on property to settle the amount owed for $54,928 less than the total amount due which reflects this income. The company plans to negotiate the remainder of its accounts payable if funds can be raised for the settlements.

Net Income (Loss)

We suffered a net loss of $~~479~~79,~~468~~910 and $9,~~623~~703,~~438~~348 respectively for the three and ~~six~~nine months ended ~~June~~September 30, 2010 as compared to $~~236~~1,~~853~~789,174 and $~~332~~2,~~019 respectively~~121,193 respectively for the same three and ~~six~~nine month periods in ~~ended in~~ 2009, ana decrease and increase in losses of $~~242~~1,~~615~~709,264 and $97,~~291~~582,~~419~~155 respectively for the three and nine ~~six~~ months ended ~~June~~ September 30, 2010 as compared to the same periods in 2009. The ~~increase~~decrease in net loss in the three months ended ~~June~~September 30, 2010 as compared to the same period in 2009 was primarily attributable to a decrease in ~~oil~~general and ~~gas~~administrative ~~sales~~costs, ~~net~~$1,685,832 ~~of operating~~and ~~expenses~~a ofdecrease in impairment expense, $258,~~715;~~472 ~~increase~~which was offset by a decrease in ~~general~~oil and ~~administrative~~gas ~~costs,~~sales net of operating expenses of $94,~~139,654~~719; increase in interest expense, $287,~~045~~258; increase in depreciation, $13; and a decrease in ~~settlement~~gain ofon ~~liabilities~~scrap sales of $4923,~~444~~000; gain from derivatives of $139,423; and increase in impairment expense of $179,486. The ~~decrease~~ increase in net loss in the ~~six~~nine months ended ~~June~~September 30, 2010 as compared to the same period in 2009 was primarily attributable to a decrease in oil and gas sales net of operating expenses of $1621,~~544~~313; increase in general and administrative costs, $97,~~139~~453,~~654~~822; increase in interest expense, $3240,~~941~~199; increase in loss on derivative, $97,447; and an increase in impairment ~~expense~~ expense of $~~179~~121,~~486~~014. All of this was offset by a decrease in depreciation expense of $8471, ~~and~~ a decrease in settlement of liabilities of $174,569, and a gain on scrap sales, $23,000.

We financed our loss of $9,~~623~~703,~~438~~348 for the ~~six~~nine months ended ~~June~~September 30, 2010 ~~primarily~~ primarily with a decrease in cash, $~~186~~134; depreciation and amortization expense, $3248,~~495~~743; stock based compensation expense, $9,118,183; increase in ~~impairment~~ impairment of $369,371; increase in accounts payable, $41161,~~910~~384; increase in ~~accrued~~ accrued expenses, $1017,~~068~~326; notes payable, $73103,500; and an increase in debtor ~~judgment~~ judgment payable, $1625,~~884~~326. These sources of funds were offset by increase in in the gain in settlement from accounts payable of $~~125~~229,~~413~~497, decrease in ~~accounts~~ accounts receivable, $2520,~~606~~466; amortization of debt discount, $23,873; non cash loss on derivative liability, $97,447; and a decrease in loans from officers, $810,~~460~~976.

There were no material changes in financial condition during the ~~six~~nine months ended ~~June~~ September 30, 2010.

Material changes in results of operations. The results of operations obtained during the ~~first~~ first six months of 2010 differ markedly from those of the first ~~six~~nine months of 2009. The 2010 results reflect share based compensation ~~expense~~ expense of $9,005,206, a loss on impairment of $369,371, a gain on settlement issue of $229,497, and loss on derivative of $97,447.

Item 4.

Controls and Procedures

Evaluation of disclosure controls and procedures.

As of ~~June~~September 30, 2010, under the direction of our Chief Executive Officer who is ~~also~~ also our Chief Financial Officer, we evaluated our disclosure controls and ~~procedures~~ procedures as of ~~June~~September 30, 2010 and concluded that our disclosure controls and procedures were ineffective as of ~~June~~September 30, 2010 due to a material weakness because of the lack of segregation of duties. The lack of segregation of duties results from lack of accounting staff with accounting technical expertise necessary for an effective system of internal control. At any time, if it appears that any control can be implemented to continue to mitigate such weaknesses, it is immediately implemented. As soon as our finances allow, we will hire sufficient accounting staff and implement appropriate procedures for monitoring and review of work performed by our Chief Executive Officer.

Changes in Internal Control Over Financial Reporting.

There were no changes in our internal control over financial reporting during the fiscal quarter ended ~~June~~September 30, 2010, that have materially affected, or are ~~likely~~ likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 3.

LEGAL PROCEEDINGS.

Following is a synopsis of lawsuits that have a potential impact on Superior Oil and Gas Company.

We are a judgment debtor in the case of Gotz Werner & Roman Werner v. Daniel Lloyd, McCoy Energy Co., Superior Oil and Gas Co., and Big Daddy’s BBQ Sauce & Spices Co., Superior Court of Arizona, Maricopa County, No. CV 99-11813. The principal amount of ~~the~~ the judgment is $337,686 with ten percent interest accruing from and after ~~October~~ October 14, 1999. As of ~~June~~September 30, 2010, the amount of the judgment ~~including~~ including interest was $~~691~~707,~~030~~914.

Daniel Lloyd, McCoy Energy Co. and Big Daddy’s BBQ Sauce & Spices Co. are also judgment debtors in this litigation, each to the same extent and in the same amount as our company. Daniel Lloyd was the chief executive officer, chief financial officer and a director of our company until his death in July 2008. McCoy Energy Co. is under the control of Gayla McCoy, the secretary and treasurer of our company. Big Daddy’s BBQ Sauce & Spices Co. is under the control of Mr. Dan Lloyd, Jr. and Ms. McCoy.

Brooks Investments, LLC, et al. v. Blue Quail Resources, Inc., et al., Case No. CJ-2006-595, District Court of Canadian County, State of Oklahoma wherein Superior Oil and Gas Company, Daniel H. Lloyd and Gayla McCoy are named as co-defendants. Plaintiffs have alleged that Blue Quail Resources, Inc. committed securities fraud when it sold interests in the Lonesome River #1 oil and gas project and are seeking rescission of their contract and actual and punitive damages against Blue Quail and the other co-defendants. The primary plaintiff, an attorney, has testified that no one from Superior or Dan Lloyd or Gayla McCoy ever made any representations to him regarding the Lonesome River #1 oil and gas project. Furthermore, it has been admitted by the plaintiffs that neither Superior Oil and Gas Company, Daniel Lloyd or Gayla McCoy have ever had a contractual relationship with any of the plaintiffs and that the only reason they have been named as defendants was on the basis of their attorney’s advice. That attorney has now been terminated from further representation and a Motion for Summary Judgment is now pending before the Court which Superior’s attorneys anticipate will result in a dismissal as to Superior Oil and Gas Company, Daniel H. Lloyd and Gayla McCoy.

HOCO Drilling, LLC v. Superior Oil and Gas Company, et al., Case No. CJ-2007-59-01, District Court of Garfield County, State of Oklahoma wherein Superior Oil and Gas Company is being sued for breach of contract by HOCO Drilling, LLC for $179,263.23, plus costs and attorneys fees. Superior filed an answer and counterclaim against HOCO for breach of contract and negligence in an amount in excess of that claimed by HOCO, plus costs and attorney’s fees. Subsequent to December 31, 2008, this lawsuit was settled with the agreement that the Company will pay to the plaintiff $100,000 within one year from May 1, 2009. The $100,000 amount is included in the accounts payable at June 30, 2010.

Midwest Mortgage Brokers and Paul Gee v. Hershey S. Baum, et al., Case No. CJ-2004-7796, District Court of Tulsa County, State of Oklahoma wherein Superior Oil and Gas Company is a named co-defendant involves a loan that was made by Paul Gee and Midwest Mortgage Brokers and Paul Gee to Hershey S. Baum and others for which Superior Oil and Gas purportedly agreed to repurchase 100,000 shares of stock from plaintiffs as part of the consideration for making the loan. The court granted summary judgment against Superior Oil and Gas Company in the amount of $286,448.39 on April 23, 2008 and Superior has filed an appeal from this judgment with the Oklahoma Supreme Court. The attorneys for Superior believe they will be successful in overturning the summary judgment and ultimately prevailing in the lawsuit.

James B. Jackson v. Superior Oil & Gas Co., District Court, Canadian County, Case No. CJ-2008-87. The plaintiff’s claims relate to geological service provided to Superior for which he has not been paid. A default judgment was entered against Superior in the amount of $14,578.29 plus costs and attorney’s fees. Sufficient amounts have been recorded in accounts payable at the balance sheet date to cover the cost of this judgment.

Eagle Well Services, Inc. v. Superior Oil and Gas Co., District Court, Oklahoma County, Case No. CJ-2009-773 involves a claim by Eagle Well Services d/b/a Bronco Energy Services for $94,649.69 for services performed by it for the company. The amount of the claim is in accounts payable at ~~June~~September 30, 2010.

Superior Oil and Gas Co. v. Vince Freechea, District Court, Oklahoma County, Case No. CJ-2009-1793 involves a claim by Superior against an individual who operated a company known as High Plains Tubular. The claim arises out of that individual’s procurement of casing and tubing on behalf of Superior. Mr. Freechea subsequently wrongfully sold this casing and tubing to a third party and refused to remit the proceeds of the sale to Superior. Superior paid Mr. Freechea in excess of $220,000 for the product and is seeking to recover its cost plus the profit for a total of $350,000.

Item 2.

Unregistered Sales of Equity Securities

InThere ~~our~~have ~~last~~been ~~report~~no of sales of unregistered ~~equity~~ securities ~~(Form~~since ~~10-Q~~our ~~for~~last ~~period~~report ~~ended~~of ~~March~~June 3130, 2010~~), we reported the sale, in transactions exempt from registration pursuant to Regulation D, Rule 506, of the following securities to the following persons~~. ~~However, the per share value was incorrectly reported for all sales. The correct per share value for all such sales is set forth below.~~

Date	Purchaser	No. of shares		Value		Consideration Paid for Shares
3-29-10	Sam Guttman		39,000,000	$	0.065	Asset purchase
3-29-10	Weiss Family Trust		101,000,000	$	0.065	Asset purchase
4-14-10	Marilyn C. Kenan, Trustee		816,480	$	0.03	Legal Services
4-14-10	Daniel Lloyd, Jr.		816,480	$	0.03	Payroll
4-14-10	Douglas A. Newman		816,479	$	0.03	Accounting Services
4-14-10	Gayla McCoy		816,479	$	0.03	Payroll
4-14-10	Masterline Group		500,000	$	0.03	Financial consulting

Item 6.

Exhibits

The following exhibits are filed, by incorporation by reference, as part of this Form 10-Q:

3(i)	Articles of Incorporation	*
3(ii)	Bylaws	*
10.5	Purchase and Sale Agreement entered into December 13, 2005 between Superior Oil and Gas Co. and William H. Foster.	**
10.6	Purchase and Sale Agreement entered into April 24, 2006 between Enerhance Energy, Inc. and Superior Oil and Gas Co.	**
10.7	Assignment of Oil and Gas Leases executed May 23, 2006 from Hudson Resources Corp to Superior Oil and Gas Co. covering lands in Kingfisher County, Oklahoma	***
10.8	Assignment of Oil and Gas Leases executed May 23, 2006 from Hudson Resources Corp to Superior Oil and Gas Co. covering lands in Canadian County, Oklahoma	***
10.9	Assignment of Oil and Gas Leases executed May 23, 2006 from Hudson Resources Corp to Superior Oil and Gas Co. covering lands in Pushmataha County, Oklahoma	***
14	Code of Ethics for the Chief Executive Officer and Senior Financial Officers.	+++
16	Letter on Change in Certifying Accountant	*
31.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Previously filed with Form 10-SB on January 31, 2003, EDGAR Accession #0001060830-03-000019; incorporated herein.

+++

Previously filed with Form 10-KSB, SEC #000-50173, on April 19, 2005; incorporated herein.

Previously filed with Form 10-QSB 03-31-06 on May 22, 2006, EDGAR Accession #0001010549-06-000326; incorporated herein.

***

Previously filed with Form 8-K Current Report 05-23-06 on May 30, 2006, EDGAR Accession #0001010549-06-000348; incorporated herein.

*	Previously filed with Form 10-SB on January 31, 2003, EDGAR Accession #0001060830-03-000019; incorporated herein.
+++	Previously filed with Form 10-KSB, SEC #000-50173, on April 19, 2005; incorporated herein.
**	Previously filed with Form 10-QSB 03-31-06 on May 22, 2006, EDGAR Accession #0001010549-06-000326; incorporated herein.
***	Previously filed with Form 8-K Current Report 05-23-06 on May 30, 2006, EDGAR Accession #0001010549-06-000348; incorporated herein.

SIGNATURES

Pursuant to the requirements of the Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 20, 2010		Superior Oil and Gas Co.
Date: November 22, 2010	Superior Oil and Gas Co.
		/s/ B.J. Sparks
	By	/s/ B.J. Sparks
	By
		B.J. Sparks, President

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