United States ~~Securities and Exchange Commission~~

Securities and Exchange Commission

Washington, D.C. 20549

FORM 10-K

~~[ ]~~o ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, ~~2010~~ 2011

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

FOR THE TRANSITION PERIOD FROM TO ________TO________

COMMISSION FILE NUMBER 0-14278

~~GOLDEN~~TERRALENE ~~SPIRIT~~FUELS ~~ENTERPRISES LTD.~~CORPORATION

DELAWARE		52-2132622
(STATE OF INCORPORATION)		(I.R.S. ID)

35 South Ocean Avenue, Patchogue, New York, 11772

1-888-488-6882

Securities registered pursuant to Section 12(b) of the Act:

COMMON STOCK OTC: BB

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, Par Value $.0001

(Title of Class)

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

Securities registered pursuant to Section 12(g) of the Act: Common stock, $.0001 par value per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ~~[ ]~~o No ~~[X]~~o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. ~~[ ]~~o Yes ~~[X]~~ x No

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ~~[X]~~ o

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

Large accelerated filer ~~[ ]~~ o Accelerated filer o Non-accelerated filer o Smaller reporting company x (Do not check if a smaller reporting company)

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

~~Non-accelerated~~As ~~filer [ ] (Do~~of ~~not~~March ~~check~~30, if2012, athere ~~smaller~~were ~~reporting~~72,198,691 ~~company) Smaller~~shares ~~reporting~~of ~~company [X]~~the issuer's $0.0001 par value common stock issued and outstanding.

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

As of March 31, 2011, there were 51,048,691 shares of the issuer's $0.0001 par value common stock issued and outstanding.

Documents incorporated by reference: None

2Terralene Fuels Corporation

~~Golden Spirit Enterprises Ltd.~~ FORM 10-K

For The Fiscal Year Ended December 31, ~~2010~~2011

INDEX

PART I

PART I		3

ITEM 1.	BUSINESS	3
ITEM 1A.	RISK FACTORS	7
ITEM 1B.	UNRESOLVEDCOMMENTS	7
ITEM 2.	PROPERTIES	8
ITEM 3.	LEGAL PROCEEDINGS	8
ITEM 4.	MINE SAFETY DISCLOSURES	8

PART II		9

ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES	9
ITEM 6.	SELECTED FINANCIAL DATA	12
ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	12
ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	13
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	F-1
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	14
ITEM 9A.	CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES	14
ITEM 9B.	OTHER INFORMATION	15

PART III		16

ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	16
ITEM 11.	EXECUTIVE COMPENSATION	17
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	18
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	18
ITEM 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES	19

PART IV		20

ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	20

SIGNATURES		21

ITEM 1. BUSINESS

ITEM 1A. RISK FACTORS

ITEM 1B. UNRESOLVEDCOMMENTS

ITEM 2. PROPERTIES

ITEM 3. LEGAL PROCEEDINGS

ITEM 4. (REMOVED AND RESERVED)

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 6. SELECTED FINANCIAL DATA

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

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

ITEM 9A. CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

ITEM 9B. OTHER INFORMATION

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

ITEM 11. EXECUTIVE COMPENSATION

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

SIGNATURES

Note About Forward-Looking Statements

Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section entitled “Risk Factors” (refer to Part I, Item 1A). We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

PART I

ITEM 1. BUSINESS

GENERAL

Terralene Fuels Corporation, formerly Golden Spirit Enterprises Ltd., formerly Golden Spirit Gaming Ltd., formerly Golden Spirit Mining Ltd., formerly Golden Spirit Minerals Ltd., formerly 2UOnline.com, Inc., formerly Power Direct, Inc., was incorporated in the State of Delaware on September 13, 1993, and we maintain our principal executive offices at 1288 Alberni Street, Suite 806, Vancouver, British Columbia, Canada V6E 4N5. Our offices in the United States are located at 177 Telegraph Road, Suite 541, Bellingham, Washington 98226.

We changed our name from Power Direct, Inc., to 2UOnline.com, Inc. by filing a Certificate of Amendment to our Certificate of Incorporation on January 31, 2000. We also changed our trading symbol from "PWDR" to "TWOU" in order to reflect our decision to shift our focus from oil and gas production to Internet- related activities. Our symbol was then changed to "TWOUE". On or about April 18, 2000, we were removed from the Over-the-Counter Bulletin Board ("OTCBB") for failure to comply with NASD Rule 6530, which requires any company listed on the OTCBB to be current in its public reporting obligations pursuant to the Securities and Exchange Act of 1934. The Company was re-instated on the OTCBB on October 7, 2002 under the symbol "TWOU". The Company filed a certificate of amendment to its Articles of Incorporation with the State of Delaware on October 1, 2003 to change its name to Golden Spirit Minerals Ltd. The name change reflects management's decision to shift the Company's focus from internet-based business development to mineral exploration. On October 8, 2003, the trading symbol for the Company became "GSPM". On October 19, 2004, the Company changed its name to Golden Spirit Mining Ltd. and the trading symbol was "GSML". On July 18, 2005 the Company changed its name to Golden Spirit Gaming Ltd. and the trading symbol was “GSGL”. On June 30, 2006, the Company changed it’s name to Golden Spirit Enterprises Ltd. and the trading symbol is currently “GSPT”. On November 29, 2011, the Company changed its name to Terralene Fuels Corporation and the trading symbol remains as “GSPT.

On August 17, 2005, the Company incorporated Golden Spirit Poker Company Limited, a British Virgin Islands Corporation. Golden Spirit Gaming Ltd. was issued 10 shares of this Company for consideration of $10.00, representing 100% of the issued capital of Golden Spirit Poker Company Limited.

We were originally incorporated to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware. We were inactive from September 13, 1993, through November 1998, when we began the process of identifying potential business interests, including, but not necessarily limited to, interests in oil and natural gas producing properties. The Company will be involved in the development, production, financing and packaging of innovative film and television programming. In addition, the Company has signed an agreement with Eneco Industries to participate in a series of Municipal Solid Waste (garbage) fueled Recycling and Resource Recovery Plants.

OUR BUSINESS

Our initial focus was on the development of oil and natural gas properties. In this regard, we purchased interests in two properties; one in the United States and one in Canada. In or around December 1999, we decided to review the focus of our business, primarily the direction we would take with our various oil and gas projects. We decided that maintaining interests in oil and gas producing properties should no longer be our focus. Due to the growth of the Internet, we decided to pursue Internet-related activities. We determined that Internet-related activities would provide a positive revenue stream sooner than oil and gas producing activities. Due to the lack of success with our internet activities we decided to abandon this business and commencing in 2003 instead pursue opportunities in mineral exploration and development

We had limited success with both our internet activities and our mineral exploration and development activities. In mid 2005, management of the Company decided to focus on online gaming and in June 2006. On June 30, 2006, the Company changed its name and focus from gaming to reflect the Company’s plan to expand its operations to include the marketing of other products and venues. The Company will be involved in the development, production, financing and packaging of innovative film and television programming. On September 30, 2006, Congress passed the Unlawful Internet Gambling Enforcement Act of 2006. The new proposed legislation prohibits banks, credit card companies, money transmitting businesses, and other third-party payment providers from knowingly processing online gaming transactions. Due to this ruling and the negative impact it would have on the Golden Spirit poker website, management decided to discontinue its online gaming operations in 2006. 3

~~The~~We ~~Company~~had ~~has~~limited ~~engaged~~success inwith ~~the~~both ~~development,~~our ~~production,~~internet ~~financing~~activities and ~~packaging~~our ofmineral ~~innovative~~exploration ~~film~~ and ~~television~~development ~~programming~~activities. ItIn ~~continues~~mid to2005, ~~look~~management ~~for~~of ~~financing~~the ~~for~~Company ~~its~~decided ~~films~~to infocus ~~progress~~on ~~and~~online ~~distribution~~gaming ~~channels~~and ~~for~~in ~~its~~June ~~acquired films~~2006. InOn ~~addition~~June 30, 2006, the Company ~~has~~changed ~~signed~~its anname ~~agreement~~and ~~with~~focus ~~Eneco~~from ~~Industries~~gaming to ~~participate~~reflect inthe aCompany’s ~~series~~plan ofto ~~Municipal~~expand ~~Solid~~its ~~Waste~~operations ~~(garbage)~~to ~~fueled~~include ~~Recycling~~the ~~and~~marketing ~~Resource~~of ~~Recovery~~other ~~Plants~~products and venues. The ~~Agreement~~Company ~~calls~~was ~~for~~involved ain ~~joint~~the ~~venture~~development, ~~utilizing~~production, ~~EnEco's~~financing ~~expertise~~ and ~~technology~~packaging toof ~~develop~~innovative afilm ~~municipal~~and ~~solid~~television ~~waste~~programming. ~~(garbage)~~During ~~recycling~~2011, ~~and~~we ~~biomass~~opted ~~derived~~out ~~renewable~~of ~~energy~~this ~~facility~~business totally. ~~Golden~~On ~~Spirit~~September ~~and~~30, ~~EnEco~~2006, ~~will~~Congress ~~build~~passed ~~and~~the ~~operate~~Unlawful aInternet ~~series~~Gambling ofEnforcement ~~solid~~Act ~~waste~~of ~~recycling~~2006. ~~and~~The ~~biomass~~new ~~derived~~proposed ~~renewable~~legislation ~~energy~~prohibits ~~facility~~banks, ~~with~~credit ~~greenhouse~~card ~~and~~companies, ~~algae~~money ~~subsystems~~transmitting ~~that~~businesses, ~~will~~and ~~utilize~~other ~~our~~third-party ~~Thermal~~payment ~~Oxidation~~providers ~~Process~~from ~~System~~knowingly ~~(TOPS)~~processing ~~technology~~online togaming ~~generate~~transactions. ~~electricity~~Due ~~for~~to ~~sale~~this toruling and the ~~local~~negative ~~power~~impact ~~grid.~~it ~~Further~~would ~~details~~have on the ~~new~~ Golden Spirit -poker ~~Eneco~~website, ~~project~~management ~~can~~decided beto ~~viewed~~discontinue onits ~~our~~online ~~website~~gaming ~~www.goldenspirit.ws.~~operations in 2006.

The Company has engaged in the development, production, financing and packaging of innovative film and television programming. It continues to look for financing for its films in progress and distribution channels for its acquired films. In ~~2010~~addition, the Company has signed an agreement with ~~Global~~Eneco ~~Terralene~~Industries ~~Inc~~to ~~.for~~participate ~~the~~in ~~acquisition~~a series of ~~all~~Municipal ~~assets~~Solid ~~pertaining~~Waste to(garbage) ~~Terralene~~fueled ~~Fuels~~Recycling and Resource Recovery Plants. ~~Terralene~~The ~~Fuel~~Agreement iscalls for a ~~patented~~joint ~~fuel~~venture ~~alternative~~utilizing ~~formulation~~EnEco's ~~that~~expertise isand ~~the~~technology ~~equivalent~~to ofdevelop 87a ~~octane~~municipal ~~regular~~solid ~~gasoline~~waste (garbage) recycling and ~~utilizes~~biomass derived renewable energy ~~sources~~facility. inGolden ~~45%~~Spirit ofand ~~its~~EnEco ~~composition.~~will ~~Terralene’s~~build ~~unique~~and ~~fuel~~operate ~~reduces~~a ~~greenhouse~~series ~~gas~~of solid waste recycling and ~~other~~biomass ~~environmental~~derived ~~damaging~~renewable ~~emissions~~energy facility with greenhouse and ~~can~~algae besubsystems ~~easily~~that ~~integrated~~will ~~into~~utilize our Thermal Oxidation Process System (TOPS) technology to generate electricity for sale to the ~~existing~~local ~~fuel~~power ~~infrastructure~~grid. Further details on the new ~~Golden~~Terralene ~~Spirit~~Fuels - ~~Terralene~~Eneco project can be viewed on our website www.~~terralenefuels~~goldenspirit.~~com~~ws.

In 2010, the Company signed an agreement with Global Terralene Inc .for the acquisition of all assets pertaining to Terralene Fuels. Terralene Fuel is a patented fuel alternative formulation that is the equivalent of 87 octane regular gasoline and utilizes renewable energy sources in 45% of its composition. Terralene’s unique fuel reduces greenhouse gas and other environmental damaging emissions and can be easily integrated into the existing fuel infrastructure. Further details on the new Terralene Fuels project can be viewed on our website www.terralenefuels.com.

Our Investment in Available for sale securities – related parties

Organa ~~Gardens International Inc.~~

The Company owns common shares of Organa Gardens International Inc. (formerly Shotgun Energy Corporation) (“Organa”), a public company with directors and significant shareholders in common that does not represent a position of control of or significant influence over Organa. During 2007 the Company recorded an unrealized loss in the carrying value of its available-for-sale securities totaling $3,775, which was recorded as other comprehensive income (loss). During the year ended December 31, 2008, the Company recorded an unrealized loss in the carrying value of its available-for-sale securities totaling $5,612 which was recorded as other comprehensive income (loss). During the year ended December 31, 2009, the Company sold 50,000 shares resulting in a realized loss of $(780) and recorded an unrealized loss in the carrying value of its available-for-sale securities totaling $5,138, which was recorded as other comprehensive income. During the year ended December 31, 2010, the Company received 700,300 restricted shares of Organa valued to $7,003 pursuant to a debt settlement and sold Nil Organa shares. The Company recorded an unrealized loss in the carrying value of its available-for-sale securities totaling $2,541, which was recorded as other comprehensive income (loss). As a result, the carrying value of the available for sale shares of Organa is $4,504 as at December 31, 2010.

5During the year ended December 31, 2011, the Company sold Nil Organa shares and recorded an additional unrealized loss of $ (3,097). As a result, the carrying value of the available for sale shares of Organa is $1,407 as at December 31, 2011. Effective December 31, 2011, the Company recorded a $1,689 write-down of its investment in Organa due to an other-than-temporary decline in the value of the shares.

~~Legacy Wine & Spirits Internatonal Ltd.~~4

Legacy

The Company owns common shares of Legacy Wine & Spirits International Ltd. (“Legacy”), a public company with directors and significant shareholders in common, that does not represent a position of control of or significant influence over Legacy. During 2007 the Company recorded an unrealized gain in the carrying value of its available-for-sale securities totaling $590,993. During the year ended December 31, 2008, the Company acquired 23,200 shares valued at $19,532 sold 99,400 shares resulting in a realized gain of $28,645(net of commissions of $2,132) and recorded an unrealized gain in the carrying value of its available-for-sale securities totaling $275,121, which was recorded as other comprehensive income. During the year ended December 31, 2009, the Company sold 301,600 shares resulting in a realized gain of $180,398 and recorded an other-than-temporary loss in the carrying value of its available-for-sale securities totaling $34,001.

During the year ended December 31, 2010, the Company the Company received 1,451,360 restricted shares of Legacy valued to $72,568 pursuant to a debt settlement and sold Nil Legacy shares. The Company recorded an other-than-~~tmporary~~temporary loss in the carrying value of its available-for-sale securities totaling $47,069. As a result, the carrying value of the available for sale shares of Legacy is $37,535 as at December 31, 2010.

During the year ended December 31, 2011, the Company sold Nil Legacy shares and recorded an additional unrealized loss of $ (33,781). As a result, the carrying value of the available for sale shares of Legacy is $3,754 as at December 30, 2011. Effective December 31, 2011, the Company recorded a $32,843 write-down of its investment in Legacy due to an other-than-temporary decline in the value of the shares.

Available for sale securities – related parties include the following:

	~~December 31 ,~~	December 31 ,		December 31,
	2010	2009
		2011		2010
2,345,937 (2009-894,577) shares of Legacy Wine & Spirits	$ 37,535	$ 53,675
2,345,937 (2010-2,345,937) shares of Legacy Wine & Spirits		$	3,754	$	37,535
703,750 (2009- 3,450) shares of Organa Gardens International	4,504	41
703,750 (2010- 703,750) shares of Organa Gardens International			1,407		4,504
	$ 42,039	$ 53,716
		$	5,161	$	42,039

FILM PRODUCTION & DEVELOPMENT SECTOR

Film Production and development costs at December 31, ~~2010~~2011 are made up as follows:

	Gross Cost	~~Accumulated amortization~~	~~2008 writedown of film rights and related costs~~	~~Net Cost December 31, 2010~~	~~Net~~Accumulated ~~Cost December 31, 2009~~amortization		Writedown of film rights and related costs			Net Cost December 31, 2011		Net Cost December31, 2010
Acquired films and film rights	$ ~~84,970~~	~~$ -~~84,970	~~(84,969)~~	~~$ 1~~	$ 1	-		(84,970	)	$	-	$	1
Films in progress	~~5,793~~	-5,793	~~(5,793)~~	-	-	-		(5,793	)		-		-
	$ 90,763	$ -	$ (90,762)	$ 1	$ 1
	$	90,763			$	-	$	(90,763	)	$	-	$	1

Acquired Films and Film Rights

The Company has acquired from Beijing Dadu Sunshine Film & Culture Co. Ltd., the exclusive distribution rights worldwide, except for Asia, for the film “Tales of Rain and Magic”. Under the terms of the License Agreement dated March 23, 2007, the Company will receive twenty-five (25) percent interest of the gross receipts earned from sales in those countries. “Tales of Rain and Magic” portrays a young girl’s coming of age, and of the psycho-logical and physiological changes that she encounters along the way to adulthood. As of December 31, 2010, due to uncertainty of realization, the Company has written down this project to a value of $Nil. (2009 - $Nil)

The Company has signed an Agreement dated March 15, 2007 with Amazing Super Buddies Productions Inc. to act as the Producer and Distributor for a 3D Television Series for children known as “ASB: Power Force”. In return for advancing $54,000 U.S. to produce the series, the Company will receive a guaranteed fifteen (15) percent interest of gross receipts earned worldwide, inclusive of all character licensing and merchandise sold from the “ASB: Power Force Series.” As of December 31, 2010, due to uncertainty of realization, the Company has written down this project to a nominal value of $1. (2009 - $1)

Films in progress

The Company has signed an Agreement dated February 15, 2007 to represent “The Cabin”, a teen-oriented, horror/thriller feature film. As distributor of the film, Golden Spirit will receive a fee of twenty-five percent (25%) from the gross amounts of all sales or distribution deals made internationally and twenty percent (20%) from the gross amounts of all sales or distribution deals made in the United States. As of December 30, 2010, due to uncertainty of realization, the Company has written down this project to a value of $Nil. (2009 - $Nil)

The Company has signed an Agreement dated March 15, 2007 to represent “The Brotherhood of the Phoenix”, a high concept action drama feature film. As distributor of the film, Golden Spirit will receive a fee of twenty-five percent (25%) from the gross amounts of all sales or distribution deals made internationally and twenty percent (20%) from the gross amounts of all sales or distribution deals made in the United States. As of December 31, 2010, due to uncertainty of realization, the Company has written down this project to a value of $Nil. (2009 - $Nil)

The Company has signed a Memorandum of Understanding dated March 23, 2007 with Pentafilms, SARL of France and Beijing Dadu Sunshine Film & Culture Co. Ltd. to co-produce and distribute a film called “The Mists of Time”. The financial contribution for production by each party, the final percentage of distribution rights, final casting and budget will be determined in the final agreement. As of December 31, 2010, the Company has spent $ Nil on this project. (2009 - $Nil)

SUMMARY:

The $84,970 for acquired film rights consists of the following:

Cash payment for rights to Amazing Super Buddies (ASB)

$ 54,000

Cash payment for rights to Tales of Rain and Magic (TRM)

5,000

35 mm film reels and gala screening costs for TRM

3,535

Compact Discs and costs for trailer for ASB 2,435

Total $ 84,970

The $5,793 for films in progress consists of the following:

Cash payment for rights to The Cabin

$ 1,000

Cash payment for rights to Brotherhood of the Phoenix

1,000

Filming of trailers for The Cabin and Brotherhood of the Phoenix 3,793

Total

$ 5,793

The Company reviews the impairment issue at each quarter on its completed films and films in progress. The Company has letters of intent on hand with distribution partners for its films. The Company expected those assets to generate revenue in the fourth quarter of 2008. The Company received no firm commitments to distribute its films as of December 31, 2010, therefore, due to uncertainty of realization, the Company has written down the above projects to a nominal value of $1.

WASTE ENERGY SECTOR

The Thermal Oxidation Process System (TOPS) Greencycle Gasification plants decompose organic matter (with heat and air) and recover non-organics by utilizing specialized equipment and is a proven alternative to landfills. Greencycle uses low heat (500-600 Celsius) to convert all the carbon locked up in unsorted garbage into a form where it produces high quality heat through a second stage gas oxidizer running at around 1,100 Celsius. This process creates energy, enough to make electrical energy and support district heating / greenhouses. The Greencycle system provides controlled conditions to utilize Carbon Dioxide (CO2) for accelerated plant growth in greenhouses and algae farms. The other non-carbon materials in garbage, such as aluminum, tin, copper and stainless steel, and can be easily separated after all the carbon has been removed without melting or slagging. Micron sized metals, silica, calcium etc, are also sorted out for re-use by using the Ash Recycling and Recovery Equipment (ARRE) sub-system.

7As of December 31, 2011, the Company has not secured any facilities to construct the Gasification Plant, nor has it incurred any other expenditures for the year ended December 31, 2011. (2010 - $Nil)

~~As of December 31, 2010, the Company has not secured any facilities to construct the Gasification Plant, nor has it incurred any other expenditures for the year ended December 31, 2010. (2009 - $Nil)~~5

ALTERNATIVE FUELS SECTOR

On August 24, 2010, the Company signed an agreement with Global Terralene Inc. for the acquisition of all assets pertaining to Terralene Fuels. Under the terms of the agreement, the Company will issue 7,000,000 restricted common shares to Global Terralene Inc. in two phases. On November 30, 2010, the Company approved and issued 5,000,000 restricted common shares valued at $125,000 to Global Terralene Inc. The Company will issue a further 2,000,000 restricted common shares valued at $50,000 once certain documents outlined in the agreement are prepared and exchanged by both parties (issued February 2012). Terralene Fuel is a patented fuel alternative formulation that is the equivalent of 87 octane regular gasoline and utilizes renewable energy sources in 45% of its composition. Terralene’s unique fuel reduces greenhouse gas and other environmental damaging emissions and can be easily integrated into the existing fuel infrastructure. During the year ended December 31, 2011, the Company capitalized $6,212 in patent work.

~~Investment~~Total Investments in Terralene Fuels costs at December 31, 2011 and 2010 ~~are~~total ~~made~~$131,212 upand as$125,000 ~~follows~~respectively, and include the following assets:

		Gross Cost
Patents, trademarks, copyright		$ 75,000
Formulas, reports, studies Schematics, proprietary info Website Terralene brandname		25,000 15,000 5,000 5,000
		$ 125,000

Patents, trademarks, copyright

Formulas, reports, studies

Schematics, proprietary info

Website

Terralene brandname

The purchase was completd in 2012 and no preliminary allocation has been completed.

Amortization for intangible assets with definitive useful life purchased from Terralene Fuels, specifically the website, will be recorded over the estimated useful life of the website using the straight-line method for financial statement purposes when the product or service has been delivered or performed and invoiced by the Company and it begins to recognize revenues.

Ownership Interests.

The following chart specifies our stock ownership at December 31, ~~2010~~2011

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

Percent
Ownership	Entity	Nature of Ownership

9.70%	Legacy Wine & Spirits International Ltd.	3,934,357 Shares of Common Stock *

1.70%	Organa Gardens International Inc.	703,750 Shares of Common Stock **

~~Percent~~ _______

Entity

Nature of Ownership

Ownership

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

9.7%

Legacy Wine & Spirits International Ltd.

3,934,357 Shares of Common Stock *

1.7%

Organa Gardens International Inc. 703,750 Shares of Common Stock **

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

* 1,451,360 of these shares are restricted common shares

** 700,300 of these shares are restricted common shares.

Employees.

We currently have 2 full-time employee/consultants. None of our employees are subject to any collective bargaining agreements.

8 6

Change in Directors

On ~~December~~February 201, ~~2010~~2012, the Registrant accepted the resignation of ~~Christopher~~Sharon ~~Scheive~~Deutsch as Secretary, Treasurer, Director and Chief Financial Officer of the Registrant. The resignation was not motivated by a disagreement with the Registrant on any matter relating to the Registrant's operations, policies or practices.

On ~~December~~February 201, ~~2010~~2012 Matt Kelly, an American businessman, based in New York U.S.A., joined the Board of Directors and was appointed Secretary, Treasurer and Chief Financial Officer of the Registrant.

On December 20, 2010 Jaclyn Cruz, an American businesswoman, based in New York U.S.A., a current member of the Board of Directors was confirmed as President and Executive Officer of the Registrant.

As of December 31, 2010, the Directors and Officers of the Registrant are:

Jaclyn Cruz – Director, President and Chief Executive Officer.

Matt Kelly – Director, Secretary, Treasurer and Chief Financial Officer.

Effective December 20, 2010, the Company has relocated

its administrative offices to the State of New York:

New Address:

Corporate Offices

35 South Ocean Avenue

Patchogue, NY, 11772

Fax – 1 888 265 0498

Phone – 1 888 488 6882

Entering into a new agreement

Terralene Fuel is a patented fuel alternative formulation that is the equivalent of 87 octane regular gasoline and utilizes renewable energy sources in 45% of its composition. Terralene’s unique fuel reduces greenhouse gas and other environmental damaging emissions and can be easily integrated into the existing fuel infrastructure.

ITEM 1A. RISK FACTORS

Not applicable to smaller reporting companies

ITEM 1B. UNRESOLVED STAFF COMMENTS

None

ITEM 2. PROPERTIES

Property Held by Us. As of the dates specified in the following table, we held the following property in the following amounts:

Property

Property	December 31, 2011	December 31, 2010

Cash	US $ 61	US $824

December 31, 2010

December 31, 2009

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

Cash

US $ 824

US $1,233

=========================================================

We do not presently own any interests in real estate. We do not presently own any inventory or equipment.

Our Facilities.

We do not own any real property. As of August 1, 2010, ~~Golden~~Terralene ~~Spirit~~Fuels ~~Enterprises~~Corporation ~~Ltd.~~ has leased 1250 sq. ft of office space from Holm Investments Ltd. at $2,500 per month for a period of 3 years.

~~Golden~~Terralene ~~Spirit~~Fuels ~~Enterprises~~Corporation ~~Ltd.’s~~ principal corporate offices are located at 35 South Ocean Avenue Patchogue, NY, 11772 Fax – 1 888 265 0498 Phone – 1 888 488 6882

Patchogue, NY, 11772 Fax – 1 888 265 0498 Phone – 1 888 488 6882

ITEM 3. LEGAL PROCEEDINGS

None

ITEM 4. ~~(REMOVED~~ MINE ~~AND~~SAFETY ~~RESERVED)~~DISCLOSURES

~~None~~Not applicable

10 8

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES

As ~~PURCHASES~~at OFDecember ~~EQUITY~~31, ~~SECURITIES~~2011 there were approximately 2,000 holders of the outstanding shares of the Golden Spirit Enterprises Ltd.'s $0.0001 par value common stock. Golden Spirit Enterprises Ltd. participates in the OTC Bulletin Board Electronic Quotation System maintained by the National Association of Securities Dealers, Inc. On or about April 18, 2000, we were removed from the Over-the-Counter Bulletin Board ("OTCBB") for failure to comply with NASD Rule 6530, which requires any company listed on the OTCBB to be current in its public reporting obligations pursuant to the Securities and Exchange Act of 1934. The Company was re-instated on the OTCBB on October 7, 2002 under the symbol "TWOU". Commensurate with the name change and forward stock split, the Company also took the necessary steps to change its symbol and CUSIP Number. Therefore, the Registrant's CUSIP Number has changed from 9021014 20 7 to 3811194 10 9. On October 8, 2003, being 6:30 A.M. EST, the Registrant's symbol changed from TWOU to "GSPM". On October 19, 2004, being 6:30 A.M. EST, the Registrant's symbol changed from GSPM to "GSML".

AsEffective at ~~December 31, 2010 there were approximately 2,000 holders of~~ the ~~outstanding~~opening ~~shares~~on ofJuly the Golden Spirit Enterprises Ltd.'s $0.0001 par value common stock. Golden Spirit Enterprises Ltd. participates in the OTC Bulletin Board Electronic Quotation System maintained by the National Association of Securities Dealers, Inc. On or about April 18, ~~2000,~~2005 ~~we were removed from~~ the Over-the-Counter Bulletin Board ("OTCBB") for failure to comply with NASD Rule 6530, which requires any company listed on the OTCBB to be current in its public reporting obligations pursuant to the Securities and Exchange Act of 1934. The Company’s ~~was re-instated on the OTCBB on October 7, 2002 under the~~ symbol ~~"TWOU".~~changed ~~Commensurate~~from ~~with~~GSML ~~the name change and forward stock split, the Company also took the necessary steps~~ to ~~change~~“GSGL” ~~its symbol~~ and ~~CUSIP Number. Therefore,~~ the ~~Registrant's~~ CUSIP Number ~~has~~became ~~changed~~38119U ~~from 9021014 20 7 to 3811194~~ 10 91. ~~On October 8, 2003, being 6:30 A.M. EST, the Registrant's symbol changed from TWOU to "GSPM". On October 19, 2004, being 6:30 A.M. EST, the Registrant's symbol changed from GSPM to "GSML".~~

Effective at the opening on ~~July~~June ~~18th~~30, ~~2005~~2006, the Company’s symbol changed from ~~GSML~~GSGL to “~~GSGL~~GSPT” and the CUSIP Number ~~became~~is ~~38119U~~now 38119N 10 17.

Effective at the opening on ~~June~~November ~~30th~~29, ~~2006~~2011, the Company’s symbol ~~changed~~remained ~~from~~as ~~GSGL to~~ “GSPT” and the CUSIP Number is now ~~38119N~~88104B 10 75.

According to quotes provided by quotemedia.com, the ~~Golden~~Terralene ~~Spirit~~Fuel ~~Enterprises Ltd.~~Corporation’s common stock closed at:

Quarter

Quarter	High		Low
2009 First Quarter	$	0.10	$	0.02
2009 Second Quarter	$	0.09	$	0.02
2009 Third Quarter	$	0.09	$	0.02
2009 Fourth Quarter	$	0.09	$	0.02
2010 First Quarter	$	0.04	$	0.02
2010 Second Quarter	$	0.09	$	0.02
2010 Third Quarter	$	0.07	$	0.03
2010 Fourth Quarter	$	0.05	$	0.03
2011 First Quarter	$	0.00	$	0.00
2011 Second Quarter	$	0.06	$	0.03
2011 Third Quarter	$	0.07	$	0.01
2011 Fourth Quarter	$	0.01	$	0.00

~~High~~The Company traded as 2UOnline.com from January 1, 2003 to October 8, 2003, as Golden Spirit Minerals Ltd. from October 9, 2003 to October 18, 2004, as Golden Spirit Mining Ltd. from October 19, 2004 to July 17, 2005 and Golden Spirit Gaming Ltd. from July 18, 2005 to June 29, 2006 and Golden Spirit Enterprises Ltd. from June 30, 2006 to November 29, 2011 and Terralene Fuels Corporation thereafter to date. Such quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

~~Low~~9

2008 First Quarter

$0.27

$0.10

2008 Second Quarter

$0.25

$0.14

2008 Third Quarter

$0.14

$0.04

2008 Fourth Quarter

$0.10

$0.02

2009 First Quarter

$0.10

$0.02

2009 Second Quarter

$0.09

$0.02

2009 Third Quarter

$0.09

$0.02

2009 Fourth Quarter

$0.09

$0.02

2010 First Quarter

$0.04

$0.02

2010 Second Quarter

$0.09

$0.02

2010 Third Quarter

$0.07

$0.03

2010 Fourth Quarter

$0.05

$0.03

The Company traded as 2UOnline.com from January 1, 2003 to October 8, 2003, as Golden Spirit Minerals Ltd. from October 9, 2003 to October 18, 2004, as Golden Spirit Mining Ltd. from October 19, 2004 to July 17, 2005 and Golden Spirit Gaming Ltd. from July 18, 2005 to June 29, 2006 and Golden Spirit Enterprises Ltd. from June 30, 2006 to date.. Such quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

The public may read and copy any materials filed with the SEC at the SEC's Public Reference Room at 450 Fifth Street NW, Washington, D.C. 20549. The public may also obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is http://www.sec.gov.

Common Stock:

The Company is authorized to issue 500,000,000 shares of common stock, $.0001 par value, each share of common stock having equal rights and preferences, including voting privileges. The shares of $.0001 par value common stock of the Company constitute equity interests in the Company entitling each shareholder to a pro rata share of cash distributions made to shareholders, including dividend payments. The holders of the Company's common stock are entitled to one vote for each share of record on all matters to be voted on by shareholders. There is no cumulative voting with respect to the election of directors of the Company or any other matter, with the result that the holders of more than 50% of the shares voted for the election of those directors can elect all of the Directors. The holders of the Company's common stock are entitled to receive dividends when, as and if declared by the Company's Board of Directors from funds legally available therefore; provided, however, that the cash dividends are at the sole discretion of the Company's Board of Directors. In the event of liquidation, dissolution or winding up of the Company, the holders of common stock are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities of the Company and after provision has been made for each class of stock, if any, having preference in relation to the Company's common stock. Holders of the shares of Company's common stock have no conversion, preemptive or other subscription rights, and there are no redemption provisions applicable to the Company's common stock. All of the outstanding shares of the Company's common stock are duly authorized, validly issued, fully paid and non-assessable. As of December 31, ~~2010~~2011, 4472,~~923~~198,691 shares of ~~Golden~~Terralene ~~Spirit~~Fuels ~~Enterprises~~Corporation’s ~~Ltd.~~ common stock were issued and outstanding.

(1) ~~2010~~ 2011 Stock Transactions

On January 13, 2011, the Company issued 25,000 restricted common shares valued at $750 to a new director for his services and issued 250,000 restricted common shares valued at $7,500 to a consultant for his services in relation to the company’s Terralene Fuels project.

The Company issued a total of 12,000,000 common shares pursuant to the exercise of options under the Company’s 2011 Stock Incentive and Option Plan at prices between $0.03 - $0.035 per share to satisfy debt to related parties in the amount of $171,000 and for consulting services in the amount of $197,250.

During the year ended December 31, 2011, 15,000,000 restricted common shares were issued valued at $30,000 pursuant to deferred compensation contracts with related parties.

(2) 2010 Stock Transactions

During the year ended December 31, 2010, 515,000 incentive stock options were granted and immediately exercised at $0.04 per share to satisfy debts related parties in the amount of $20,600, 5,610,000 incentive stock options were granted and immediately exercised at $0.02 per share to satisfy debts related parties in the amount of $112,200 and 5,341,667 incentive stock options were granted and immediately exercised at $0.03 per share to satisfy debts related parties in the amount of $160,250 and 3,050,000 for services at $91,500.

During the year ended December 31, 2010, 1,500,000 restricted common shares were issued valued at $60,000 pursuant to deferred compensation contracts with related parties.

During the year ended December 31, 2010, 465,000 restricted common shares were issued valued at $14,950 to four individuals for advisory board and other services.

During the year ended December 31, 2010, 5,000,000 restricted common shares were issued valued at $125,000 pursuant to the acquisition of Terralene Fuels.

~~(2) 2009 Stock Transactions~~10

~~During~~(3) 2011 ~~the~~Stock ~~year ended December 31, 2009:~~Options

~~During~~On ~~the~~January ~~year ended December 31~~18, ~~2009~~2011, ~~3,900,000~~the ~~incentive~~Company ~~stock~~filed ~~options~~a ~~were~~Registration ~~granted~~Statement ~~and~~on ~~immediately exercised~~Form atS-8 ~~prices~~to ~~between~~cover ~~$0.02~~12,000,000 ~~-$0.06~~shares ~~per~~of ~~share~~common stock to ~~satisfy~~be ~~debts related~~granted ~~parties~~pursuant into the ~~amount~~Company’s of2011 $Stock ~~109,250.~~Incentive ~~Accordingly,~~and noOption ~~compensation expense was recorded~~Plan.

On ~~November~~December 3023, ~~2009~~2011, the Company ~~issued~~filed ~~700,000~~a ~~restricted~~Registration ~~common~~Statement ~~shares~~on ~~valued~~Form atS-8 ~~$49~~to cover 15,000,000 shares of common stock to ~~consultants~~be granted pursuant to ~~three~~the ~~deferred~~Company’s ~~compensation~~2012 ~~agreements~~Stock ~~dated~~Incentive ~~November~~and ~~18,~~Option ~~2009~~Plan.

During the year ended December 31, 2011, the Company issued a total of 12,000,000 common shares pursuant to the exercise of options under the Company’s 2011 Stock Incentive and Option Plan at prices between $0.03 - $0.035 per share to satisfy debt to related parties in the amount of $171,000 and for consulting services in the amount of $197,250.

~~(3)~~The Company’s stock option activity is as follows:

2010 Stock Options

	Number of options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life

Balance, December 31, 2009		3,002,517		$	0.20	2.67 years
Granted during 2010		14,516,667			-
Exercised during 2010		(14,516,667	)		-
Balance, December 31,2010		3,002,517			-
Granted during 2011		12,000,000			0.03
Exercised during 2011		(12,000,000	)
Balance, December 31, 2011		3,002,517		$	0.20	2.67 years

(4) 2010 Stock Options

On April 21, 2010, the Company filed a Registration Statement on Form S-8 to cover 10,000,000 shares of common stock to be granted pursuant to the Company’s 2010 Stock Incentive and Option Plan.

The Company’s stock option activity is as follows:

	~~Number of options~~	~~Weighted~~Number ~~Average~~of ~~Exercise Price~~options	~~Weighted Average Remaining Contractual Life~~		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Balance, December 31, 2008	~~3,002,517~~	~~$ 0.20~~	~~2.67 years~~3,002,517		$	0.20	2.67 years
Granted during 2008	-	-	-			-
Exercised during 2008	-	-	-			-
Granted during 2009	~~3,900,000~~	-	3,900,000			-
Exercised during 2009	~~(3,900,000)~~	~~$ 0.03~~	~~2.67 years~~(3,900,000	)	$	0.03	2.67 years
Granted during 2010	~~14,516,667~~	-	14,516,667			-
Exercised during 2010	~~(14,516,667)~~	~~0.03~~	(14,516,667	)		0.03
Balance, December 31, 2010	~~3,002,517~~	~~$ 0.09~~	~~2.67 years~~3,002,517		$	0.09	2.67 years

~~(4)~~11

2009 - Stock Options

During the year ended December 31, 2009, the Company did not grant any stock options to directors, employees or consultants.

The Company’s stock option activity is as follows:

	Number of options	Weighted Average Exercise Price	Weighted Average Remaining Contractual Life
Balance, December 31, 2006	2,028,247	$ 0.26	3.08 years
Granted during 2007	3,800,000	0.10
Exercised during 2007	(1,980,000)	0.10
Balance, December 31, 2007	3,848,247	$ 0.18	3.80 years
Granted during 2008	-	-
Exercised during 2008	(845,730)	0.10
Granted during 2009	3,900,000	-
Exercised during 2009	(3,900,000)	$ 0.03	2.67 years
Balance, December 31, 2009	3,002,517	$ 0.20	2.67 years

ITEM 6. SELECTED FINANCIAL DATA

FINANCIAL HIGHLIGHTS

Fiscal Year Ended December 31	~~2010~~	~~2009~~2011	~~2008~~	~~2007~~	~~2006~~	2010			2009			2008			2007
Revenue	$ Nil	$ Nil	$ Nil	$ 43l	$ Nil
Revenu1		$ Nil				$ Nil			$ Nil			$ Nil			$	43l
Operating Loss	~~(352,321)~~	~~(181,787)~~	(~~274~~359,~~195)~~281	~~(454,400~~)	~~(2,345,010)~~		(352,321	)		(181,787	)		(274,195	)		(454,400	)
Net Loss	~~(399,390)~~	~~(36,170)~~	(~~245~~393,~~550)~~813	~~(422,958~~)	~~(2,954,033)~~		(399,390	)		(36,170	)		(245,550	)		(422,958	)
Basic and diluted net loss per share	0.01	0.01	0.01	0.03	0.20
BaBasic and diluted net loss per share			0.01				0.01			0.01			0.01			0.03
Cash dividends declared per share	-	-	-	-	-
CaCash dividends declared per share			-				-			-			-			-
Cash, cash equivalents, & short term investments	~~824~~	~~1,223~~	~~1,556~~61	~~6,282~~	~~7,547~~		824			1,223			1,556			6,282
Total assets	~~167,863~~	~~137,827~~	1136,~~015,455~~434	~~740,556~~	~~52,573~~		167,863			137,827			1,015,455			740,556
Long-term obligations	-	-	-	-	-		-			-			-			-
Stockholders’ equity (deficit)	~~6,413~~	~~(123,592)~~	~~690~~35,~~820~~389	~~391,502~~	~~(329,376)~~		6,413			(123,592	)		690,820			391,502

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OPERATIONS

THIS FOLLOWING INFORMATION SPECIFIES CERTAIN FORWARD-LOOKING STATEMENTS OF MANAGEMENT OF THE COMPANY. FORWARD-LOOKING STATEMENTS ARE STATEMENTS THAT ESTIMATE THE HAPPENING OF FUTURE EVENTS ARE NOT BASED ON HISTORICAL FACT.FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY, SUCH AS "MAY", "SHALL", "WILL", "COULD", "EXPECT", "ESTIMATE", "ANTICIPATE", "PREDICT", "PROBABLE", "POSSIBLE", "SHOULD", "CONTINUE", OR SIMILAR TERMS, VARIATIONS OF THOSE TERMS OR THE NEGATIVE OF THOSE TERMS. THE FORWARD-LOOKING STATEMENTS SPECIFIED IN THE FOLLOWING INFORMATION HAVE BEEN COMPILED BY OUR MANAGEMENT ON THE BASIS OF ASSUMPTIONS MADE BY MANAGEMENT AND CONSIDERED BY MANAGEMENT TO BE REASONABLE. OUR FUTURE OPERATING RESULTS, HOWEVER, ARE IMPOSSIBLE TO PREDICT AND NO REPRESENTATION, GUARANTY, OR WARRANTY IS TO BE INFERRED FROM THOSE FORWARD-LOOKING STATEMENTS.

THE ASSUMPTIONS USED FOR PURPOSES OF THE FORWARD-LOOKING STATEMENTS SPECIFIED IN THE FOLLOWING INFORMATION REPRESENT ESTIMATES OF FUTURE EVENTS AND ARE SUBJECT TO UNCERTAINTY AS TO POSSIBLE CHANGES IN ECONOMIC, LEGISLATIVE, INDUSTRY, AND OTHER CIRCUMSTANCES. AS A RESULT, THE IDENTIFICATION AND INTERPRETATION OF DATA AND OTHER INFORMATION AND THEIR USE IN DEVELOPING AND SELECTING ASSUMPTIONS FROM AND AMONG REASONABLE ALTERNATIVES REQUIRE THE EXERCISE OF JUDGMENT. TO THE EXTENT THAT THE ASSUMED EVENTS DO NOT OCCUR, THE OUTCOME MAY VARY SUBSTANTIALLY FROM ANTICIPATED OR PROJECTED RESULTS, AND, ACCORDINGLY, NO OPINION IS EXPRESSED ON THE ACHIEVABILITY OF THOSE FORWARD-LOOKING STATEMENTS. NO ASSURANCE CAN BE GIVEN THAT ANY OF THE ASSUMPTIONS RELATING TO THE FORWARD-LOOKING STATEMENTS SPECIFIED IN THE FOLLOWING INFORMATION ARE ACCURATE, AND WE ASSUME NO OBLIGATION TO UPDATE ANY SUCH FORWARD-LOOKING STATEMENTS.

1412

Liquidity and Capital Resources.

For the year ended December 31, ~~2010~~2011, we had total assets of $~~167~~136,~~863~~434, compared to total assets in ~~2009~~2010 of $~~137~~167,~~827~~683. This includes a cash balance of $~~824~~61, compared to $~~1,223~~824 in ~~2009~~2010. We have available for sale securities with a fair value of $425,~~039~~161as as at December 31, ~~2010,~~2011 and intangible assets of $~~125~~131,~~000 and film production & development costs of $1~~212.

At December 31, ~~2010~~2011, we had current liabilities of $~~161~~101,~~450~~045, which was represented by accounts payable and accrued liabilities of $3138,~~695~~439 and $~~129~~62,~~755~~606 due to related parties. At December 31, ~~2009~~2010 we had current liabilities of $~~261~~161,~~419~~450. The decrease in liabilities was essentially due to a decrease in amounts payable to related parties. At December 31, ~~2010~~2011, we had a working capital deficiency of $(~~160~~100,~~626~~984) (~~2009~~2010 - $(~~257~~160,~~120~~626)).

Results of Operations

We realized revenue in ~~2010~~2011 of $Nil (~~2009~~2010- $ Nil) and other income of $Nil (~~2009~~2010 - $~~179,618~~Nil) ~~as the result of a 2009 gain on the sale of securities of a related party~~. In prior years, our revenues from prior businesses totaled $167,449. During the year ended December 31, ~~2010~~2011 our loss was $~~399~~393,~~390~~813 (~~2009~~2010 - $36399,~~170~~390). This ~~increase~~decrease in loss was due to an increase in consulting fees ~~and~~offset noby ~~gains~~a ondecrease in the ~~sale~~loss on impairment of securities – related parties, decrease in professional fees and decrease in investor relations fees.

From inception to December 31, ~~2010~~2011, we have incurred cumulative net losses of $1718,~~628~~021,~~009~~912 resulting primarily from a write-down and equity loss in Organa Gardens International Inc. (a related party) of $1,707,581, a $600,000 property option loss as a recorded value of certain restricted shares issued to Legacy Wine & Spirits International Ltd. (a related party – see our Investment in Available for sale securities (b) Legacy Wine & Spirits International Ltd. above) , a gain on the sale of securities – related parties of ($216,509) , a loss on impairment of ~~seurities~~securities-~~relate~~related parties of $81115,~~070and~~ 602 and general and administrative expenses of $1516,~~926~~286,~~892~~173, the majority of which is made up of consulting fees and stock based compensation expense totaling $7,~~603~~836,~~878~~741.

The cash and equivalents constitute our present internal sources of liquidity. Because we are not generating any significant revenues, our only external source of liquidity is the sale of our capital stock and any advances from officers, directors or shareholders.

To address the going concern problem discussed in our financial statements, we will require additional working capital. We will also require additional funds to implement our business strategies, including funds for: payment of increased operating expenses, and further implementation of film industry business strategies, payment of undetermined expenses relating to the Eneco venture and payment of undetermined expenses relating to the Terralene Fuels venture. No assurance can be given, however, that we will have access to the capital markets in the future, or that financing will be available on acceptable terms to satisfy our cash requirements needed to implement our business strategies. Our inability to access the capital markets or obtain acceptable financing could have a material adverse effect on our results of operations and financial condition and could severely threaten our ability to operate as a going concern. Our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary as a result of a number of factors.

payment of increased operating expenses, and further implementation of film industry business strategies,

payment of undetermined expenses relating to the Eneco venture and payment of undetermined expenses relating to the Terralene Fuels venture.

No assurance can be given, however, that we will have access to the capital markets in the future, or that financing will be available on acceptable terms to satisfy our cash requirements needed to implement our business strategies. Our inability to access the capital markets or obtain acceptable financing could have a material adverse effect on our results of operations and financial condition and could severely threaten our ability to operate as a going concern. Our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary as a result of a number of factors.

Our Plan of Operation for the Next 12 Months. We anticipate that we will need to raise additional capital within the next 12 months in order to continue as a going concern. Anticipated revenues for the first quarter of 2009 are not expected to be significant. Therefore, additional capital may be raised through additional public or private financings, as well as borrowings and other resources. To the extent that additional capital is raised through the sale of equity or equity-related securities, the issuance of such securities could result in dilution of our stockholders. There can be no assurance that additional funding will be available on favorable terms, if at all. If adequate funds are not available within the next 12 months, we may be required to curtail our operations significantly or to obtain funds through entering into arrangements with collaborative partners or others that may require us to relinquish rights to certain of our assets that we would not otherwise relinquish.

15We do anticipate certain expenditures within the next 12 months for our Investment in Terralene Fuels. We do not anticipate a significant change in the number of our employees within the next 12 months. We are not aware of any material commitment or condition that may affect our liquidity within the next 12 months.

We do anticipate certain expenditures within the next 12 months for our film production and distribution. We do not anticipate any significant research and development within the next 12 months, nor do we anticipate that we will lease or purchase any significant equipment within the next 12 months. We do not anticipate a significant change in the number of our employees within the next 12 months. We are not aware of any material commitment or condition that may affect our liquidity within the next 12 months.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Securities held in our equity and other investments portfolio and equity derivatives are subject to price risk, and generally are not hedged.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders

~~Golden~~Terralene ~~Spirit~~Fuels ~~Enterprises Ltd.~~Corporation

~~New~~We ~~York~~have audited the accompanying consolidated balance sheets of Terralene Fuels Corporation, U(formerly Golden Spirit Enterprises Ltd.S) (a development stage company) as of December 31, 2011 and 2010, and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for each of the years in the two year period ended December 31, 2011 and for the cumulative period from September 13, 1998 (inception) through December 31, 2011.A Terralene Fuels Corporation’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

We have audited the accompanying consolidated balance sheets of Golden Spirit Enterprises Ltd. (a development stage company) as of December 31, 2010 and 2009 (restated), and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for each of the years ended December 31, 2010 and 2009 (restated) and for the cumulative period from September 13, 1998 (inception) through December 31, 2010. Golden Spirit Enterprises Ltd.’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of ~~Golden~~Terralene ~~Spirit~~Fuels ~~Enterprises~~Corporation ~~Ltd.~~ as of December 31, ~~2010~~2011 and ~~2009 (restated)~~2010, and the results of its activities and cash flows for each of the years in the two year period ended December 31, ~~2010~~2011 and ~~2009 (restated) and~~ for the cumulative period from September 13, 1993 (inception) through December 31, ~~2010~~2011 in conformity with accounting principles generally accepted in the United States.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s current liabilities exceed current assets, has incurred significant losses since inception, all of which raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regards to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

__________________________

/s/ L.L. Bradford & Company, LLC

Las Vegas, Nevada

~~March~~April 3116, ~~2011~~2012

16F-1

~~GOLDEN~~TERRALENE ~~SPIRIT~~FUELS ~~ENTERPRISES LTD.~~CORPORATION

(formerly Golden Spirit Enterprises Ltd.)

(A development stage company)

CONSOLIDATED BALANCE SHEETS

	~~December 31,~~	December 31,			December 31,
	2010	2009
		2011			2010
(Restated)
ASSETS
ASSETS
CURRENT ASSETS
CURRENT ASSETS
Cash		$	61		$	824
Cash	$ 824	$ 1,223
TOTAL CURRENT ASSETS			61			824
Accounts Receivable	-	3,076
AVAILABLE FOR SALE SECURITIES – related parties			5,161			42,039
TOTAL CURRENT ASSETS	824	4,299
INVESTMENTS IN INTANGIBLE ASSETS			131,212			125,000
AVAILABLE FOR SALE SECURITIES – related parties INTANGIBLE ASSETS	42,039 125,000	53,716 -
FILM PRODUCTION & DEVELOPMENT COSTS			-			1
FILM PRODUCTION & DEVELOPMENT COSTS	1	1
TOTAL ASSETS		$	136,434		$	167,863
DUE FROM LEGACY WINE & SPIRITS INTERNATIONAL LTD. DUE FROM ORGANA GARDENS INTERNATIONAL INC.	- -	72,668 7,143
LIABILITIES AND STOCKHOLDERS’ EQUITY
TOTAL ASSETS	$ 167,863	$ 137,827
CURRENT LIABILITES
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Accounts payable and accrued liabilities		$	38,439		$	31,695
CURRENT LIABILITES
Due to related parties			62,606			129,755
Accounts payable and accrued liabilities	$ 31,695	$ 33,582
TOTAL CURRENT LIABILITIES			101,045			161,450
Due to related parties	129,755	227,837
COMMITMENTS AND CONTINGENCIES
TOTAL CURRENT LIABILITIES	$ 161,450	$ 261,419
STOCKHOLDERS’ EQUITY
COMMITMENTS AND CONTINGENCIES
Common stock, $0.0001 par value, 500,000,000 shares authorized
STOCKHOLDERS’ EQUITY (DEFICIT)
Issued and outstanding:
Common stock, $0.0001 par value, 500,000,000 shares authorized
72,198,691 (2010 – 44,923,691) common shares			7,220			4,492
Issued and outstanding:
Additional paid-in capital			18,467,650			18,063,878
44,923,691 (2009 – 23,442,024) common shares	4,492	2,343
Deferred compensation			(37,500	)		(56,135	)
Additional paid-in capital	18,063,878	17,481,527
Deficit accumulated during the development stage			(18,403,880	)		(18,010,067	)
Deferred compensation	(56,135)	(45,209)
Accumulated other comprehensive income (loss)			1,899			4,245
Deficit accumulated during the development stage	(18,010,067)	(17,610,677)
TOTAL STOCKHOLDERS’ EQUITY			35,389			6,413
Accumulated other comprehensive income (loss)	4,245	48,424
TOTAL LIABILITIES AND STOCKHOLDER EQUITY		$	136,434		$	167,863
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)	6,413	(123,592)
TOTAL LIABILITIES AND STOCKHOLDER EQUITY (DEFICIT)	$ 167,863	$ 137,827

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

17F-2

~~GOLDEN~~TERRALENE ~~SPIRIT~~FUELS ~~ENTERPRISES LTD.~~CORPORATION

(formerly Golden Spirit Enterprises Ltd.)

(A development stage company)

CONSOLIDATED STATEMENTS OF OPERATIONS

						~~September 13,~~			September 13,
		Year Ended		~~Year Ended~~		~~1993~~Year ~~(inception)~~Ended			1993 (inception)
		December 31,		~~December 31,~~		to December 31,			to December 31,
		2010		2009		2010
		2011				2010			2011
REVENUES				~~(Restated)~~
Processing fees		$ -	-	~~$ -~~		$ ~~98,425~~	-		$	98,425
Gaming Revenue		-	-	-		~~18,596~~	-			18,596
Sale of oil and gas interest		-	-	-		~~47,501~~	-			47,501
Interest income		-	-	-		~~2,927~~	-			2,927
TOTAL REVENUES		-	-	-		~~167,449~~	-			167,449
COST OF SALES
COST OF SALES – Poker royalties and processing fees			-				-			30,601
Poker royalties and processing fees		-		-		30,601
GROSS PROFIT (LOSS)			-				-			136,848
GROSS PROFIT (LOSS)		-		-		136,848
GENERAL AND ADMINISTRATIVE EXPENSES
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising and marketing			-				-			93,895
Advertising and marketing				-		93,895
Consulting fees			232,863				183,912			7,836,741
Consulting fees		183,912		34,881		7,603,878
Depreciation and amortization			-				-			132,569
Depreciation and amortization		-		-		132,569
Exploration costs			-				-			241,754
Exploration costs		-		-		241,754
Investor relations			26,128				34,724			757,463
Investor relations		34,724		1,458		731,335
Litigation settlement			-				-			52,169
Litigation settlement		-		52,169		52,169
Loss on settlement of debt			-				-			302,500
Loss on settlement of debt		-		-		302,500
Management fees			-				-			378,447
Management fees		-		-		378,447
Office and general			51,468				51,143			741,744
Office and general		51,143		45,506		690,276
Poker Sponsorships			-				-			52,500
Poker Sponsorships		-		-		52,500
Professional fees			35,060				43,051			719,418
Professional fees		43,051		35,235		684,358
Travel and accommodation			6,518				18,217			289,097
Travel and accommodation		18,217		12,538		282,579
Wages and salaries			7,243				11,617			268,293
Wages and salaries		11,617		-		261,050
Write-off of website development costs			-				-			425,682
Write-off of website development costs		-		-		425,682
Write-down (recovery) of URL costs			-				-			1,571,657
Write-down (recovery) of URL costs		-		-		1,571,657
Write-down of technology license			-				-			2,055,938
Write-down of technology license		-		-		2,055,938
Write-down of film production and distribution costs			1				-			90,763
Write-down of film production and distribution costs		-		-		90,762
Write-off of other assets			-				9,657			275,543
Write-off of other assets		9,657		-		275,543
TOTAL GENERAL AND ADMINISTRATIVE EXPENSES			359,281				352,321			16,286,173
TOTAL GENERAL AND ADMINISTRATIVE EXPENSES		352,321		181,787		15,926,892
OTHER INCOME (EXPENSES)
OTHER INCOME (EXPENSES)
EQUITY LOSS FROM ORGANA GARDENS INTERNATIONAL			-				-			(1,394,280	)
EQUITY LOSS FROM ORGANA GARDENS INTERNATIONAL		-		-		(1,394,280)
WRITE-DOWN OF INVESTMENT IN ORGANA GARDENS			-				-			(313,301	)
WRITE-DOWN OF INVESTMENT IN ORGANA GARDENS		-		-		(313,301)
GAIN/(LOSS) ON SALE OF SECURITIES-RELATED PARTIES			-				-			216,509
GAIN/(LOSS) ON SALE OF SECURITIES-RELATED PARTIES		-		179,618		216,509
(LOSS) ON IMPAIRMENT OF SECURITIES-RELATED PARTIES			(34,532	)			(47,069	)		(115,602	)
(LOSS) ON IMPAIRMENT OF SECURITIES-RELATED PARTIES		(47,069)		(34,001)		(81,070)
DILUTION GAIN – LEGACY WINE&SPIRITS INTERNATIONAL			-				-			334,087
DILUTION GAIN – LEGACY WINE&SPIRITS INTERNATIONAL		-		-		334,087
PROPERTY OPTION LOSS			-				-			(600,000	)
PROPERTY OPTION LOSS		-		-		(600,000)
TOTAL OTHER INCOME (EXPENSES)			(34,532	)			(47,069	)		(1,872,587	)
TOTAL OTHER INCOME (EXPENSES)		(47,069)		145,617		(1,838,055)
Loss before income taxes			(393,813	)			(399,390	)		(18,021,912	)
Loss before income taxes		(399,390)		(36,170)		(17,628,099)
Income Tax Provision			-				-			-
Income Tax Provision		-		-		-
NET LOSS		$	(393,813	)		$	(399,390	)	$	(18,021,912	)
NET LOSS		$ (399,390)		$ (36,170)		$ (17,628,099)
NET LOSS ATTRIBUTED TO NONCONTROLLING INTEREST			-				-			479,978
NET LOSS ATTRIBUTED TO NONCONTROLLING INTEREST		-		-		479,978
NET LOSS TO TERRALENE FUELS CORPORATION		$	(393,813	)		$	(399,390	)	$	(17,541,934	)
NET LOSS TO GOLDEN SPIRIT ENTERPRISES LTD.		$ (399,390)		$ (36,170)		$ (17,148,121)
BASIC AND DILUTED LOSS PER COMMON SHARE		$	(0.01	)		$	(0.01	)
BASIC AND DILUTED LOSS PER COMMON SHARE		$ (0.01)		$ (0.00)
BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING			57,486,554				31,352,220
	BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		31,352,220		19,478,120

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

18F-3

GOLDEN SPIRIT ENTERPRISES LTD.
(A development stage company)
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT
FOR THE PERIOD FROM SEPTEMBER 13, 1993 (INCEPTION) TO DECEMBER 31, 2010
					Deficit
					Accumulated	Accumulated
			Additional	Deferred	During the	Other
	Common Stock		Paid-in	Compensation	Development	Comprehensive
	Number of Shares	Amount	Capital	(Note 6)	Stage	Loss	Total
		$	$	$	$	$	$
Balance, September 13, 1993 (date of inception)	0	0	0	0	0	0	0
September 30, 2003 – common stock issued for cash at $0.01 per share	100,000	10	990	0	0	0	1,000
Net loss for the period ended December 31, 1993	0	0	0	0	(1,000)	0	(1,000)
Balance, December 31, 1993	100,000	10	990	0	(1,000)	0	0
Net loss for the years ended December 31, 1994 through 1997	0	0	0	0	0	0	0
Net loss for the year ended December 31, 1998	0	0	0	0	(10,797)	0	(10,797)
Balance, December 31, 1998	100,000	10	990	0	(11,797)	0	(10,797)
January 6, 1999 – common stock issued for Rising Phoenix
finders’ fee at $18.00 per share	13,333	1	239,999	0	0	0	240,000
January 6, 1999 – common stock issued for cash and
management remuneration at $18.00 per share	10,000	1	179,999	0	0	0	180,000
January 28, 1999 – commons stock issued for services at $21.60 per share	10,000	1	215,999	0	0	0	216,000
February 26, 1999 – common stock issued for services at $21.60 per share	8,333	1	179,999	0	0	0	180,000
April 14, 1999 – common stock issued for cash (net of finance fee
of $99,500) at $4.80 to $15.00 per share	118,792	12	900,488	0	0	0	900,500
Less: fair value of warrants issued on financing	0	0	(764,095)	0	0	0	(764,095)
April 14, 1999 – warrants issued on financing	0	0	764,095	0	0	0	764,095
April 23, 1999 – stock based compensation	0	0	210,706	0	0	0	210,706
April 28, 1999 – common stock issued for technology licence
finder’s fee at $18.00 per share	6,667	1	119,999	0	0	0	120,000
June 15, 1999 – common stock issued for technology license at
$18.00 per share	50,000	5	899,995	0	0	0	900,000
June 15, 1999 – common stock issued for services at $15.00 per share share	333	0	5,000	0	0	0	5,000
June 30, 1999 – common stock issued for services at $15.60 per share hare	4,167	0	65,000	0	0	0	65,000
July 15, 1999 – warrants issued for URL purchase	0	0	328,858	0	0	0	328,858
July 20, 1999 – common stock issued for cash on exercise of
warrants at $18.0 per share	13,333	1	239,999	0	0	0	240,000

TERRALENE FUELS CORPORATION

19(formerly Golden Spirit Enterprises Ltd.)

September 1, 1999 – warrants issued for URL purchase	0	0	220,146	0	0	0	220,146
September 1, 1999 – common stock issued for cash on exercise
of warrants at $18.00 per share	1,667	0	30,000	0	0	0	30,000
October 14, 1999 – common stock issued for cash on exercise of	667	0	10,000	0	0	0	10,000
warrants at $15.00 per share
October 22, 1999 – stock0based compensation	0	0	42,963	0	0	0	42,963
November 3, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share	1,667	0	25,000	0	0	0	25,000
November 9, 1999 – common stock issued for technology
license at $ per share	50,000	5	899,995	0	0	0	900,000
November 15, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share	3,333	0	50,000	0	0	0	50,000
November 19, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share	10,833	1	194,999	0	0	0	195,000
November 24, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share	13,333	1	239,999	0	0	0	240,000
November 25, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share	8,333	1	149,999	0	0	0	150,000
November 25, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share	4,167	0	75,000	0	0	0	75,000
November 29, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share	667	0	10,000	0	0	0	10,000
December 6, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
December 9, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
Dividends paid	0	0	0	0	(219,978)	0	(219,978)
Rounding adjustment	0	2	(2)	0	0	0	0
Net loss	0	0	0	0	(4,201,051)	0	(4,201,051)
Balance, December 31, 1999	431,291	43	5,560,130	0	(4,432,826)	0	1,127,347
January 24, 2000 – common stock issued for cash on exercise	833	0	12,500	0	0	0	12,500
of warrants at $15.00 per share
January 26, 2000 – common stock issued for cash on exercise	1,333	0	20,000	0	0	0	20,000
of warrants at $15.00 per share
January 31, 2000 – common stock issued for cash on exercise	833	0	12,500	0	0	0	12,500
of warrants at $15.00 per share
February 8, 2000 – common stock issued for cash on exercise	833	0	12,500	0	0	0	12,500
of warrants at $15.00 per share
February 9, 2000 – common stock issued for cash on exercise	833	0	12,500	0	0	0	12,500

of warrants at $15.00 per share
February 11, 2000 – common stock issued for cash on exercise	2,500	0	37,500	0	0	0	37,500
of warrants at $15.00 per share
February 18, 2000 – common stock issued for cash on exercise	2,500	0	37,500	0	0	0	37,500
of warrants at $15.0 per share
February 24, 2000 – common stock issued for deferred compensation at $51.00 per share	11,667	1	594,999	(595,000)	0	0	0
February 24, 2000 – common stock issued for interest in oil and gas property	63,333	6	1,519,994	0	0	0	1,520,000
February 24, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
February 28, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	1,667	0	25,000	0	0	0	25,000
March 2, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
March 8, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
March 17, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
March 24, 2000 – common stock issued for cash on exercise
of warrants at $15.0 per share	1,667	0	25,000	0	0	0	25,000
March 31, 2000 – common stock issued for cash on exercise
of warrants at $15.0 per share	833	0	12,500	0	0	0	12,500
April 12, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
April 28, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500	0	0	0	12,500
August 10 2000 – common stock issued for services at $0.30
per share	833	0	15,000	0	0	0	15,000
October 5, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	667	0	10,000	0	0	0	10,000
Deferred compensation expense recorded in the year	0	0	0	190,894	0		190,894
Rounding adjustment	0	3	(3)	0	0	0	0
Net loss	0	0	0	0	(1,350,249)	0	(1,350,249)
Balance, December 31, 2000	526,621	53	7,982,620	(404,106)	(5,783,075)	0	1,795,492
Deferred compensation expense recorded in the year	0	0	0	208,246	0	0	208,246
Net loss	0	0	0	0	(1,495,844)	0	(1,495,844)
Balance, December 31, 2001	526,621	53	7,982,620	(195,860)	(7,278,919)	0	507,894
November 6, 2002 – common stock issued for services at $1.20 per share	149,167	15	178,985	0	0	0	179,000

Unrealized gain on available-for-sale securities	0	0	0	0	0	6,832	6,832
Deferred compensation expense recorded in the year	0	0	0	71,896	0	0	71,896
Net loss	0	0	0	0	(1,025,820)	0	(1,025,820)
Balance, December 31, 2002	675,788	68	8,161,605	(123,964)	(8,304,739)	6,832	(260,198)
January 10, 2003 – common stock issued for deferred compensation at $.60	325,000	33	194,967	(195,000)	0	0	0
January 10, 2003 – common stock issued for services at $0.60	16,667	2	9,998				10,000
January 14, 2003 – common stock issued to acquire “Miss Beverly Hills”	1,666,667	167	199,833	0	0	0	200,000
January 21, 2003 – common stock issued for services at $0.36	833,333	83	299,917	0	0	0	300,000
February 4, 2003 – return and cancellation of common stock	(1,666,667)	(167)	(199,833)	0	0	0	(200,000)
February 4, 2003 – return and cancellation of common stock	(416,667)	(42)	(149,958)	0	0	0	(150,000)
February 12, 2003 – common stock issued for exercise of stock options at $0.36	16,667	2	5,998	0	0	0	6,000
February 19, 2003 – common stock issued for exercise of stock options at $0.36	16,667	2	5,998	0	0	0	6,000
April 14, 2003 – common stock issued for exercise of stock options at $0.36	33,333	3	11,997	0	0	0	12,000
May 2, 2003 – common stock issued for exercise of stock options at $0.36	163,333	16	58,784	0	0	0	58,800
May 6, 2003 – common stock issued for exercise of stock options at $0.36	41,667	4	14,996	0	0	0	15,000
May 16, 2003 – common stock issued for exercise of stock options at $0.36	33,333	3	11,997	0	0	0	12,000
May 27, 2003 – return and cancellation of common stock	(41,667)	(4)	(14,996)	0	0	0	(15,000)
May 30, 2003 – common stock issued for exercise of stock options at $0.36	66,667	7	23,993	0	0	0	24,000
June 11, 2003 – common stock issued for exercise of stock options at $0.42	145,833	15	61,235	0	0	0	61,250
June 23, 2003 – common stock issued for exercise of stock options at $0.42	16,667	2	6,998	0	0	0	7,000
June 26, 2003 - common stock issued for exercise of stock options at $0.42	16,667	2	6,998	0	0	0	7,000
July 16, 2003 - common stock issued for exercise of stock options at $0.42	37,500	4	15,746	0	0	0	15,750
July 17, 2003 - common stock issued for exercise of stock options at $0.42	25,000	3	10,497	0	0	0	10,500
July 28, 2003 - common stock issued for exercise of stock options at $0.42	12,500	1	5,249	0	0	0	5,250
August 1, 2003 - common stock issued for exercise of stock options at $0.42	50,000	5	20,995	0	0	0	21,000
August 8, 2003 - common stock issued for exercise of stock options at $0.42	16,667	2	6,998	0	0	0	7,000
August 11, 2003 - common stock issued for exercise of stock options at $0.42	45,833	5	19,245	0	0	0	19,250
August 14, 2003 - common stock issued for exercise of stock options at $0.42	8,333	1	3,499	0	0	0	3,500
August 14, 2003 - common stock issued for exercise of stock options at $0.48	91,667	9	43,991	0	0	0	44,000
August 29, 2003 - common stock issued for exercise of stock options at $0.48	25,000	3	11,997	0	0	0	12,000
August 29, 2003 - common stock issued for exercise of stock options at $0.42	8,333	1	3,499	0	0	0	3,500
October 13, 2003 – common stock issued for debt settlement at $0.54	338,426	34	182,716	0	0	0	182,750
October 13, 2003 – common stock issued for exercise of stock options at $0.04	66,667	7	47,993	0	0	0	48,000
October 22 , 2003 – common stock issued for exercise of stock options at $0.72	46,111	5	33,195	0	0	0	33,200
October 22, 2003 – common stock issued for interest in mining property at $0.48	25,000	3	26,997	0	0	0	27,000
October 24 , 2003 – common stock issued for exercise of stock options at $0.72	30,904	3	22,248	0	0	0	22,251
November 26, 2003 – common stock issued for exercise of stock options at $0.72	55,556	6	39,994	0	0	0	40,000
December 2, 2003 – common stock issued for exercise of stock options at $0.72	78,540	8	56,541	0	0	0	56,549
December 16, 2003 – return and cancellation of common stock	(5,556)	(1)	(2,332)	0	0	0	(2,333)

Stock-based compensation	0	0	364,300	0	0	0	364,300
Unrealized loss on available-for-sale securities	0	0	0	0	0	(6,947)	(6,947)
Deferred compensation expense	0	0	0	130,332	0	0	130,332
Rounding adjustment	0	(5)	5	0	0	0	0
Net loss	0	0	0	0	(1,279,867)	0	(1,279,867)
Balance, December 31, 2003	2,899,769	290	9,623,900	(188,632)	(9,584,606)	(115)	(149,163)
January 10, 2004 - common stock issued for deferred compensation at $0.90	111,111	11	99,989	(100,000)	0	0	0
January 14, 2004 – common stock issued for debt at $0.72	452,778	45	325,955	0	0	0	326,000
March 26, 2004 – common stock issued for services at $0.36	22,222	2	7,998	0	0	0	8,000
May 21, 2004 – common stock issued for exercise of stock options at $0.18	144,444	14	25,986	0	0	0	26,000
June 8, 2004 – common stock issued for exercise of stock options at $0.18	83,333	8	14,992	0	0	0	15,000
June 9, 2004 – common stock issued for exercise of stock options at $0.18	55,556	6	9,994	0	0	0	10,000
June 17, 2004 - common stock issued for debt at $0.18	344,444	34	61,966	0	0	0	62,000
June 29, 2004 – common stock issued for exercise of stock options at $0.18	50,000	5	8,995	0	0	0	9,000
July 6, 2004 – return and cancellation of common stock	(72,222)	(7)	(12,993)	0	0	0	(13,000)
July 6, 2004 – common stock issued for exercise of stock options at $0.18	88,889	9	15,991	0	0	0	16,000
September 27, 2004–common stock issued for exercise of stock options at $2.16	166,667	17	359,983	0	0	0	360,000
September 28, 2004–common stock issued for exercise of stock options at $2.16	111,111	11	239,989	0	0	0	240,000
October 1, 2004 – common stock issued for services at $1.80	7,222	1	12,999	(13,000)	0	0	0
October 1, 2004 – common stock issued for services at $1.80	97,222	10	174,990	(175,000)	0	0	0
October 18, 2004 – common stock issued for stock dividend (Note 6)	445,811	45	641,923	0	(641,968)	0	0
October 25, 2004 – common stock issued for property at $1.08	5,556	1	5,999	0	0	0	6,000
November 29, 2004 - common stock issued for property rights at $1.26	55,556	6	69,994	0	0	0	70,000
December 1, 2004 – common stock issued for services at $1.26	5,556	1	6,999	0	0	0	7,000
December 1, 2004 – common stock issued for services at $1.26	5,556	1	6,999	0	0	0	7,000
December 15, 2004 – common stock issued for property rights	55,556	6	59,994	0	0	0	60,000
Share reconciliation after dividend issue	(20)	0	0	0	0	0	0
Stock based compensation	0	0	552,100	0	0	0	552,100
Unrealized loss on available-for-sale securities	0	0	0	0	0	(1,112)	(1,112)
Deferred compensation expense	0	0	0	203,917	0	0	203,917
Rounding adjustment	0	(2)	1	0	0	0	(1)
Net loss	0	0	0	0	(1,883,337)	0	(1,883,337)
Balance, December 31, 2004	5,136,117	514	12,314,743	(272,715)	(12,109,911)	(1,227)	(68,596)
February 15, 2005 - common stock issued for stock options at $0.54	143,056	14	77,236	0	0	0	77,250
February 25, 2005 - common stock issued for stock options at $0.54	27,778	3	14,997	0	0	0	15,000
April 7, 2005 - common stock issued for stock options at $0.54	27,778	3	14,997	0	0	0	15,000
April 8, 2005 - common stock issued for stock options at $0.54	83,333	8	44,992	0	0	0	45,000

May 17, 2005 - common stock issued for stock options at $0.54	83,333	8	44,992	0	0	0	45,000
June 28, 2005 - common stock issued for consulting at $0.36	166,667	17	59,983	(60,000)	0	0	0
July 5, 2005 - common stock issued for stock options at $0.36	186,111	19	66,981	0	0	0	67,000
July 22, 2005 - common stock issued for stock options at $0.36	55,556	6	19,994	0	0	0	20,000
July 26, 2005 - common stock issued for stock options at $0.36	138,889	14	49,986	0	0	0	50,000
August 10, 2005 - common stock issued for stock options at $0.36	109,722	11	39,489	0	0	0	39,500
July 13, 2005 - common stock issued for private placement at $0.36	152,778	15	54,985	0	0	0	55,000
July 12, 2005 - common stock issued for consulting services at $0.36	5,555,556	556	1,999,444	(2,000,000)	0	0	0
Stock0based compensation	0	0	743,500	0	0	0	743,500
Unrealized gain on available-for-sale securities	0	0	0	0	0	1,112	1,112
Deferred compensation expense	0	0	0	520,208	0	0	520,208
Rounding adjustment	0	(1)	1	0	0	0	0
Net loss	0	0	0	0	(1,842,055)	0	(1,842,055)
Balance, December 31, 2005	11,866,674	1,187	15,546,320	(1,812,507)	(13,951,966)	(115)	(217,081)
January 18, 2006 - common stock issued for property options at $0.36	555,556	56	199,944	0	0	0	200,000
January 27, 2006 - common stock issued for stock options at $0.36	56,944	6	20,494	0	0	0	20,500
January 31, 2006 - common stock issued for stock options at $0.54	27,778	3	14,997	0	0	0	15,000
February 2, 2006 - common stock issued for stock options at $0.54	131,094	13	70,777	0	0	0	70,790
February 6, 2006 - common stock issued for stock options at $0.36	127,778	13	45,987	0	0	0	46,000
February 9, 2006 - common stock issued for stock options at $0.54	88,889	9	47,991	0	0	0	48,000
February 27, 2006 - common stock issued for property options at $0.36	555,556	56	199,944	0	0	0	200,000
March 30, 2006 - common stock issued for consulting services at $0.54	16,667	2	8,998	0	0	0	9,000
April 1, 2006 - common stock issued for property options at $0.36	555,556	56	199,944	0	0	0	200,000
April 24, 2006 - common stock issued for stock options at $0.36	61,111	6	21,994	0	0	0	22,000
May 8, 2006 - common stock issued for stock options at $0.36	111,111	11	39,989	0	0	0	40,000
June 2, 2006 - common stock issued for consulting services at $0.18	972,222	97	192,403	(192,500)	0	0	0
June 22, 2006 – common stock issued for stock options at $0.18	41,667	4	7,496	0	0	0	7,500
September 19, 2006 – common stock issued for stock options at $0.09	60,000	6	5,394	0	0	0	5,400
December 13, 2006 – common stock issued for stock options at $0.09	200,000	20	17,980	0	0	0	18,000
December 14, 2006 – common stock issued for consulting services at $0.19	100,000	10	18,990	0	0	0	19,000
Stock based compensation	0	0	66,600	0	0	0	66,600
Unrealized gain on available-for-sale securities	0	0	0	0	0	(569)	(569)
Deferred compensation expense	0	0	0	1,854,517	0	0	1,854,517
Rounding adjustment	21	(2)	2	0	0	0	0
Net loss	0	0	0	0	(2,954,033)	0	(2,954,033)
Balance, December 31, 2006	15,528,624	1,553	16,726,244	(150,490)	(16,905,999)	(684)	(329,376)
February 1, 2007 – common stock issued for stock options at $0.09	170,000	17	15,283	0	0	0	15,300
April 3, 2007 – common stock issued for stock options at $0.09	305,000	30	27,420	0	0	0	27,450

April 13, 2007 – common stock issued for stock options at $0.09	265,000	27	23,823	0	0	0	23,850
April 30, 2007 – common stock issued for stock options at $0.09	250,000	25	22,475	0	0	0	22,500
April 30, 2007 – common stock issued for consulting services at $0.30	7,500	1	2,249	0	0	0	2,250
June 1, 2007 - common stock issued for private placement at $0.25	200,000	20	49,980	0	0	0	50,000
June 11, 2007 - return and cancellation of common stock	(30,000)	(3)	(2,697)	0	0	0	(2,700)
June 21, 2007 - common stock issued for stock options at $0.09	140,000	14	12,586	0	0	0	12,600
June 26, 2007 – common stock issued for stock options at $0.10	200,000	20	19,980	0	0	0	20,000
July 13, 2007 - common stock issued for stock options at $0.10	50,000	5	4,995	0	0	0	5,000
July 30, 2007 - return and cancellation of common stock	(50,000)	(5)	(4,995)	0	0	0	(5,000)
August 15, 2007 - common stock issued for deferred compensation at $0.18	200,000	20	35,980	(36,000)	0	0	0
October 26, 2007 - commons stock issued for stock options at $0.09	30,000	3	2,697	0	0	0	2,700
October 26, 2007 - commons stock issued for stock options at $0.10	500,000	50	49,950	0	0	0	50,000
November 1, 2007 - return and cancellation of common stock	(250,000)	(25)	(24,975)	0	0	0	(25,000)
November 2, 2007 - commons stock issued for stock options at $0.10	250,000	25	24,975	0	0	0	25,000
November 7, 2007 - common stock issued for stock options at $0.10	400,000	40	39,960	0	0	0	40,000
November 7, 2007 - return and cancellation of common stock	(100,000)	(10)	(9,990)	0	0	0	(10,000)
November 20, 2007 - return and cancellation of common stock	(250,000)	(25)	(24,975)	0	0	0	(25,000)
November 21, 2007 - commons stock issued for stock options at $0.10	250,000	25	24,975	0	0	0	25,000
November 21, 2007 - common stock issued for private placement at $0.20	25,000	2	4,998	0	0	0	5,000
December 20, 2007 - return and cancellation of common stock	(150,000)	(15)	(14,985)	0	0	0	(15,000)
Stock based compensation	0	0	228,000	0	0	0	228,000
Unrealized gain on available-for-sale securities	0	0	0	0	0	587,218	587,218
Deferred compensation expense	0	0	0	84,668	0	0	84,668
Rounding adjustment	170	0	0	0	0	0	0
Net Loss	0	0	0	0	(422,958)	0	(422,958)
Balance, December 31, 2007	17,941,294	1,794	17,233,953	(101,822)	(17,328,957)	586,534	391,502
February 27, 2008 – common stock issued for director services at $0.11	30,000	3	3,297	0	0	0	3,300
May 16, 2008 - commons stock issued for stock options at $0.10	250,000	25	24,975	0	0	0	25,000
June 2, 2008 - commons stock issued for stock options at $0.10	375,500	37	37,513	0	0	0	37,550

June 4, 2008 - commons stock issued for stock options at $0.10	37,000	4	3,696	0	0	0	3,700
June 18, 2008 – common stock issued for director services at $0.14	25,000	2	3,498	0	0	0	3,500
July 21, 2008 - commons stock issued for stock options at $0.10	158,230	16	15,807	0	0	0	15,823
September 16, 2008 – common stock issued for director services at $0.04	25,000	2	998	0	0	0	1,000
Unrealized gain on available-for-sale securities	0	0	0	0	0	379,702	379,702
Deferred compensation expense	0	0	0	75,293	0	0	75,293
Net Loss	0	0	0	0	(245,550)	0	(245,550)
Balance, December 31, 2008	18,842,024	1,883	17,323,737	(26,529)	(17,574,507)	966,236	690,820
August 10, 2009 - commons stock issued for stock options at $0.04	100,000	10	3,990				4,000
October 6, 2009 - common stock issued for stock options at $0.02	25,000	2	498				500
October 22, 2009 - common stock issued for stock options at $0.02	2,500,000	250	49,750				50,000
November 25, 2009 - common stock issued for stock options at $0.06	100,000	10	5,990				6,000
November 30, 2009 - common stock issued for services at $0.07	700,000	70	48,930	(49,000)			0
December 4, 2009 - common stock issued for stock options at $0.05	400,000	40	19,960				20,000
December 16, 2009 - common stock issued for stock options at $0.05	275,000	28	13,722				13,750
December 30, 2009 - common stock issued for stock options at $0.03	500,000	50	14,950				15,000
Unrealized loss on available-for-sale securities						(704,024)	(704,024)
Write down of securities						(34,170)	(34,170)
Realized gain on sale of securities						(179,618)	(179,618)
Deferred compensation expense				30,320			30,320
Net Loss					(36,170)		(36,170)
Balance, December 31, 2009 (Restated)	23,442,024	2,343	17,485,527	(45,209)	(17,610,677)	48,424	(123,592)
January 25 , 2010 - common stock issued for stock options at $0.04	515,000	52	20,548				20,600
April 15 , 2010 - common stock issued for stock options at $0.02	1,150,000	115	22,885				23,000
April 20, 2010 - common stock issued for stock options at $0.02	2,435,000	244	48,456				48,700
April 26, 2010 - common stock issued for stock options at $0.02	700,000	70	13,930				14,000
May 12, 2010 - common stock issued for stock options at $0.02	1,325,000	132	26,368				26,500
May 26, 2010 - common stock issued for services at $0.04	1,500,000	150	59,850	(60,000)			0
August 12, 2010- common stock issued for stock options @ $0.03	5,200,000	520	155,480				156,000
October 27, 2010 - common stock issued for options at $0.03	250,000	25	7,475				7,500
October 27, 2010 - common stock issued for services at $0.05	50,000	5	2,495				2,500
November 24, 2010 - common stock issued for options at $0.03	2,941,667	294	87,956				88,250
December 9, 2010 - common stock issued for services at $0.03	415,000	42	12,408				12,450
December 9, 2010 - common stock issued for acquisition at $0.025	5,000,000	500	124,500				125,000
Unrealized gain on available-for-sale securities						(44,179)	(44,179)
Deferred compensation expense				49,074			49,074
Net Loss					(399,390)		(399,390)
Balance, December 31, 2010	44,923,691	4,492	18,063,878	(56,135)	(18,010,067)	4,245	6,413

The accompanying notes are an integral part of these consolidated financial statements.

GOLDEN SPIRIT ENTERPRISES LTD.

(A development stage company)

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT

FOR THE PERIOD FROM SEPTEMBER 13, 1993 (INCEPTION) TO DECEMBER 31, 2011

										Deficit
										Accumulated			Accumulated
	Common Stock				Additional			Deferred		During the			Other
	Number of Shares		Amount		Paid-in Capital			Compensation (Note 6)		Development Stage			Comprehensive Loss		Total
			$		$			$		$			$		$
Balance, September 13, 1993 (date of inception)		0		0		0			0		0			0		0
September 30, 2003 – common stock issued for cash at $0.01 per share		100,000		10		990			0		0			0		1,000
Net loss for the period ended December 31, 1993		0		0		0			0		(1,000	)		0		(1,000	)

Balance, December 31, 1993		100,000		10		990			0		(1,000	)		0		0
Net loss for the years ended December 31, 1994 through 1997		0		0		0			0		0			0		0
Net loss for the year ended December 31, 1998		0		0		0			0		(10,797	)		0		(10,797	)

Balance, December 31, 1998		100,000		10		990			0		(11,797	)		0		(10,797	)
January 6, 1999 – common stock issued for Rising Phoenix
finders’ fee at $18.00 per share		13,333		1		239,999			0		0			0		240,000
January 6, 1999 – common stock issued for cash and
management remuneration at $18.00 per share		10,000		1		179,999			0		0			0		180,000
January 28, 1999 – commons stock issued for services at $21.60 per share		10,000		1		215,999			0		0			0		216,000
February 26, 1999 – common stock issued for services at $21.60 per share		8,333		1		179,999			0		0			0		180,000
April 14, 1999 – common stock issued for cash (net of finance fee
of $99,500) at $4.80 to $15.00 per share		118,792		12		900,488			0		0			0		900,500
Less: fair value of warrants issued on financing		0		0		(764,095	)		0		0			0		(764,095	)
April 14, 1999 – warrants issued on financing		0		0		764,095			0		0			0		764,095
April 23, 1999 – stock based compensation		0		0		210,706			0		0			0		210,706
April 28, 1999 – common stock issued for technology licence
finder’s fee at $18.00 per share		6,667		1		119,999			0		0			0		120,000
June 15, 1999 – common stock issued for technology license at
$18.00 per share		50,000		5		899,995			0		0			0		900,000
June 15, 1999 – common stock issued for services at $15.00 per share share		333		0		5,000			0		0			0		5,000
June 30, 1999 – common stock issued for services at $15.60 per share hare		4,167		0		65,000			0		0			0		65,000
July 15, 1999 – warrants issued for URL purchase		0		0		328,858			0		0			0		328,858
July 20, 1999 – common stock issued for cash on exercise of
warrants at $18.0 per share		13,333		1		239,999			0		0			0		240,000
September 1, 1999 – warrants issued for URL purchase		0		0		220,146			0		0			0		220,146
September 1, 1999 – common stock issued for cash on exercise
of warrants at $18.00 per share		1,667		0		30,000			0					0		30,000
October 14, 1999 – common stock issued for cash on exercise of		667		0		10,000			0		0			0		10,000
warrants at $15.00 per share
October 22, 1999 – stock0based compensation		0		0		42,963			0		0			0		42,963
November 3, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share		1,667		0		25,000			0		0			0		25,000
November 9, 1999 – common stock issued for technology
license at $ per share		50,000		5		899,995			0		0			0		900,000
November 15, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share		3,333		0		50,000			0		0			0		50,000
November 19, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share		10,833		1		194,999			0		0			0		195,000
November 24, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share		13,333		1		239,999			0		0			0		240,000
November 25, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share		8,333		1		149,999			0		0			0		150,000
November 25, 1999 – common stock issued for acquisition of
URL’s at $18.00 per share		4,167		0		75,000			0		0			0		75,000
November 29, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share		667		0		10,000			0		0			0		10,000
December 6, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share		833		0		12,500			0		0			0		12,500
December 9, 1999 – common stock issued for cash on exercise
of warrants at $15.00 per share		833		0		12,500			0		0			0		12,500
Dividends paid		0		0		0			0		(219,978	)		0		(219,978	)
Rounding adjustment		0		2		(2	)		0		0			0		0
Net loss		0		0		0			0		(4,201,051	)		0		(4,201,051	)

F-4

Balance, December 31, 1999	431,291	43	5,560,130		0		(4,432,826	)	0	1,127,347
January 24, 2000 – common stock issued for cash on exercise	833	0	12,500		0		0		0	12,500
of warrants at $15.00 per share
January 26, 2000 – common stock issued for cash on exercise	1,333	0	20,000		0		0		0	20,000
of warrants at $15.00 per share
January 31, 2000 – common stock issued for cash on exercise	833	0	12,500		0		0		0	12,500
of warrants at $15.00 per share
February 8, 2000 – common stock issued for cash on exercise	833	0	12,500		0		0		0	12,500
of warrants at $15.00 per share
February 9, 2000 – common stock issued for cash on exercise	833	0	12,500		0		0		0	12,500
of warrants at $15.00 per share
February 11, 2000 – common stock issued for cash on exercise	2,500	0	37,500		0		0		0	37,500
of warrants at $15.00 per share
February 18, 2000 – common stock issued for cash on exercise	2,500	0	37,500		0		0		0	37,500
of warrants at $15.0 per share
February 24, 2000 – common stock issued for deferred compensation at $51.00 per share	11,667	1	594,999		(595,000	)	0		0	0
February 24, 2000 – common stock issued for interest in oil and gas property	63,333	6	1,519,994		0		0		0	1,520,000
February 24, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500		0		0		0	12,500
February 28, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	1,667	0	25,000		0		0		0	25,000
March 2, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500		0		0		0	12,500
March 8, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500		0		0		0	12,500
March 17, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500		0		0		0	12,500
March 24, 2000 – common stock issued for cash on exercise
of warrants at $15.0 per share	1,667	0	25,000		0		0		0	25,000
March 31, 2000 – common stock issued for cash on exercise
of warrants at $15.0 per share	833	0	12,500		0		0		0	12,500
April 12, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500		0		0		0	12,500
April 28, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	833	0	12,500		0		0		0	12,500
August 10 2000 – common stock issued for services at $0.30
per share	833	0	15,000		0		0		0	15,000
October 5, 2000 – common stock issued for cash on exercise
of warrants at $15.00 per share	667	0	10,000		0		0		0	10,000
Deferred compensation expense recorded in the year	0	0	0		190,894		0			190,894
Rounding adjustment	0	3	(3	)	0		0		0	0
Net loss	0	0	0		0		(1,350,249	)	0	(1,350,249	)

Balance, December 31, 2000	526,621	53	7,982,620		(404,106	)	(5,783,075	)	0	1,795,492
Deferred compensation expense recorded in the year	0	0	0		208,246		0		0	208,246
Net loss	0	0	0		0		(1,495,844	)	0	(1,495,844	)

Balance, December 31, 2001	526,621	53	7,982,620		(195,860	)	(7,278,919	)	0	507,894
November 6, 2002 – common stock issued for services at $1.20 per share	149,167	15	178,985		0		0		0	179,000
Unrealized gain on available-for-sale securities	0	0	0		0		0		6,832	6,832
Deferred compensation expense recorded in the year	0	0	0		71,896		0		0	71,896
Net loss	0	0	0		0		(1,025,820	)	0	(1,025,820	)

F-5

Balance, December 31, 2002	675,788		68		8,161,605		(123,964	)	(8,304,739	)	6,832		(260,198	)
January 10, 2003 – common stock issued for deferred compensation at $.60	325,000		33		194,967		(195,000	)	0		0		0
January 10, 2003 – common stock issued for services at $0.60	16,667		2		9,998								10,000
January 14, 2003 – common stock issued to acquire “Miss Beverly Hills”	1,666,667		167		199,833		0		0		0		200,000
January 21, 2003 – common stock issued for services at $0.36	833,333		83		299,917		0		0		0		300,000
February 4, 2003 – return and cancellation of common stock	(1,666,667	)	(167	)	(199,833	)	0		0		0		(200,000	)
February 4, 2003 – return and cancellation of common stock	(416,667	)	(42	)	(149,958	)	0		0		0		(150,000	)
February 12, 2003 – common stock issued for exercise of stock options at $0.36	16,667		2		5,998		0		0		0		6,000
February 19, 2003 – common stock issued for exercise of stock options at $0.36	16,667		2		5,998		0		0		0		6,000
April 14, 2003 – common stock issued for exercise of stock options at $0.36	33,333		3		11,997		0		0		0		12,000
May 2, 2003 – common stock issued for exercise of stock options at $0.36	163,333		16		58,784		0		0		0		58,800
May 6, 2003 – common stock issued for exercise of stock options at $0.36	41,667		4		14,996		0		0		0		15,000
May 16, 2003 – common stock issued for exercise of stock options at $0.36	33,333		3		11,997		0		0		0		12,000
May 27, 2003 – return and cancellation of common stock	(41,667	)	(4	)	(14,996	)	0		0		0		(15,000	)
May 30, 2003 – common stock issued for exercise of stock options at $0.36	66,667		7		23,993		0		0		0		24,000
June 11, 2003 – common stock issued for exercise of stock options at $0.42	145,833		15		61,235		0		0		0		61,250
June 23, 2003 – common stock issued for exercise of stock options at $0.42	16,667		2		6,998		0		0		0		7,000
June 26, 2003 - common stock issued for exercise of stock options at $0.42	16,667		2		6,998		0		0		0		7,000
July 16, 2003 - common stock issued for exercise of stock options at $0.42	37,500		4		15,746		0		0		0		15,750
July 17, 2003 - common stock issued for exercise of stock options at $0.42	25,000		3		10,497		0		0		0		10,500
July 28, 2003 - common stock issued for exercise of stock options at $0.42	12,500		1		5,249		0		0		0		5,250
August 1, 2003 - common stock issued for exercise of stock options at $0.42	50,000		5		20,995		0		0		0		21,000
August 8, 2003 - common stock issued for exercise of stock options at $0.42	16,667		2		6,998		0		0		0		7,000
August 11, 2003 - common stock issued for exercise of stock options at $0.42	45,833		5		19,245		0		0		0		19,250
August 14, 2003 - common stock issued for exercise of stock options at $0.42	8,333		1		3,499		0		0		0		3,500
August 14, 2003 - common stock issued for exercise of stock options at $0.48	91,667		9		43,991		0		0		0		44,000
August 29, 2003 - common stock issued for exercise of stock options at $0.48	25,000		3		11,997		0		0		0		12,000
August 29, 2003 - common stock issued for exercise of stock options at $0.42	8,333		1		3,499		0		0		0		3,500
October 13, 2003 – common stock issued for debt settlement at $0.54	338,426		34		182,716		0		0		0		182,750
October 13, 2003 – common stock issued for exercise of stock options at $0.04	66,667		7		47,993		0		0		0		48,000
October 22 , 2003 – common stock issued for exercise of stock options at $0.72	46,111		5		33,195		0		0		0		33,200
October 22, 2003 – common stock issued for interest in mining property at $0.48	25,000		3		26,997		0		0		0		27,000
October 24 , 2003 – common stock issued for exercise of stock options at $0.72	30,904		3		22,248		0		0		0		22,251
November 26, 2003 – common stock issued for exercise of stock options at $0.72	55,556		6		39,994		0		0		0		40,000
December 2, 2003 – common stock issued for exercise of stock options at $0.72	78,540		8		56,541		0		0		0		56,549
December 16, 2003 – return and cancellation of common stock	(5,556	)	(1	)	(2,332	)	0		0		0		(2,333	)
Stock-based compensation	0		0		364,300		0		0		0		364,300
Unrealized loss on available-for-sale securities	0		0		0		0		0		(6,947	)	(6,947	)
Deferred compensation expense	0		0		0		130,332		0		0		130,332
Rounding adjustment	0		(5	)	5		0		0		0		0
Net loss	0		0		0		0		(1,279,867	)	0		(1,279,867	)

F-6

Balance, December 31, 2003	2,899,769		290		9,623,900		(188,632	)	(9,584,606	)	(115	)	(149,163	)
January 10, 2004 - common stock issued for deferred compensation at $0.90	111,111		11		99,989		(100,000	)	0		0		0
January 14, 2004 – common stock issued for debt at $0.72	452,778		45		325,955		0		0		0		326,000
March 26, 2004 – common stock issued for services at $0.36	22,222		2		7,998		0		0		0		8,000
May 21, 2004 – common stock issued for exercise of stock options at $0.18	144,444		14		25,986		0		0		0		26,000
June 8, 2004 – common stock issued for exercise of stock options at $0.18	83,333		8		14,992		0		0		0		15,000
June 9, 2004 – common stock issued for exercise of stock options at $0.18	55,556		6		9,994		0		0		0		10,000
June 17, 2004 - common stock issued for debt at $0.18	344,444		34		61,966		0		0		0		62,000
June 29, 2004 – common stock issued for exercise of stock options at $0.18	50,000		5		8,995		0		0		0		9,000
July 6, 2004 – return and cancellation of common stock	(72,222	)	(7	)	(12,993	)	0		0		0		(13,000	)
July 6, 2004 – common stock issued for exercise of stock options at $0.18	88,889		9		15,991		0		0		0		16,000
September 27, 2004–common stock issued for exercise of stock options at $2.16	166,667		17		359,983		0		0		0		360,000
September 28, 2004–common stock issued for exercise of stock options at $2.16	111,111		11		239,989		0		0		0		240,000
October 1, 2004 – common stock issued for services at $1.80	7,222		1		12,999		(13,000	)	0		0		0
October 1, 2004 – common stock issued for services at $1.80	97,222		10		174,990		(175,000	)	0		0		0
October 18, 2004 – common stock issued for stock dividend (Note 6)	445,811		45		641,923		0		(641,968	)	0		0
October 25, 2004 – common stock issued for property at $1.08	5,556		1		5,999		0		0		0		6,000
November 29, 2004 - common stock issued for property rights at $1.26	55,556		6		69,994		0		0		0		70,000
December 1, 2004 – common stock issued for services at $1.26	5,556		1		6,999		0		0		0		7,000
December 1, 2004 – common stock issued for services at $1.26	5,556		1		6,999		0		0		0		7,000
December 15, 2004 – common stock issued for property rights	55,556		6		59,994		0		0		0		60,000
Share reconciliation after dividend issue	(20	)	0		0		0		0		0		0
Stock based compensation	0		0		552,100		0		0		0		552,100
Unrealized loss on available-for-sale securities	0		0		0		0		0		(1,112	)	(1,112	)
Deferred compensation expense	0		0		0		203,917		0		0		203,917
Rounding adjustment	0		(2	)	1		0		0		0		(1	)
Net loss	0		0		0		0		(1,883,337	)	0		(1,883,337	)

Balance, December 31, 2004	5,136,117		514		12,314,743		(272,715	)	(12,109,911	)	(1,227	)	(68,596	)
February 15, 2005 - common stock issued for stock options at $0.54	143,056		14		77,236		0		0		0		77,250
February 25, 2005 - common stock issued for stock options at $0.54	27,778		3		14,997		0		0		0		15,000
April 7, 2005 - common stock issued for stock options at $0.54	27,778		3		14,997		0		0		0		15,000
April 8, 2005 - common stock issued for stock options at $0.54	83,333		8		44,992		0		0		0		45,000
May 17, 2005 - common stock issued for stock options at $0.54	83,333		8		44,992		0		0		0		45,000
June 28, 2005 - common stock issued for consulting at $0.36	166,667		17		59,983		(60,000	)	0		0		0
July 5, 2005 - common stock issued for stock options at $0.36	186,111		19		66,981		0		0		0		67,000
July 22, 2005 - common stock issued for stock options at $0.36	55,556		6		19,994		0		0		0		20,000
July 26, 2005 - common stock issued for stock options at $0.36	138,889		14		49,986		0		0		0		50,000
August 10, 2005 - common stock issued for stock options at $0.36	109,722		11		39,489		0		0		0		39,500
July 13, 2005 - common stock issued for private placement at $0.36	152,778		15		54,985		0		0		0		55,000
July 12, 2005 - common stock issued for consulting services at $0.36	5,555,556		556		1,999,444		(2,000,000	)	0		0		0
Stock0based compensation	0		0		743,500		0		0		0		743,500
Unrealized gain on available-for-sale securities	0		0		0		0		0		1,112		1,112
Deferred compensation expense	0		0		0		520,208		0		0		520,208
Rounding adjustment	0		(1	)	1		0		0		0		0
Net loss	0		0		0		0		(1,842,055	)	0		(1,842,055	)

F-7

Balance, December 31, 2005	11,866,674		1,187		15,546,320		(1,812,507	)	(13,951,966	)	(115	)	(217,081	)
January 18, 2006 - common stock issued for property options at $0.36	555,556		56		199,944		0		0		0		200,000
January 27, 2006 - common stock issued for stock options at $0.36	56,944		6		20,494		0		0		0		20,500
January 31, 2006 - common stock issued for stock options at $0.54	27,778		3		14,997		0		0		0		15,000
February 2, 2006 - common stock issued for stock options at $0.54	131,094		13		70,777		0		0		0		70,790
February 6, 2006 - common stock issued for stock options at $0.36	127,778		13		45,987		0		0		0		46,000
February 9, 2006 - common stock issued for stock options at $0.54	88,889		9		47,991		0		0		0		48,000
February 27, 2006 - common stock issued for property options at $0.36	555,556		56		199,944		0		0		0		200,000
March 30, 2006 - common stock issued for consulting services at $0.54	16,667		2		8,998		0		0		0		9,000
April 1, 2006 - common stock issued for property options at $0.36	555,556		56		199,944		0		0		0		200,000
April 24, 2006 - common stock issued for stock options at $0.36	61,111		6		21,994		0		0		0		22,000
May 8, 2006 - common stock issued for stock options at $0.36	111,111		11		39,989		0		0		0		40,000
June 2, 2006 - common stock issued for consulting services at $0.18	972,222		97		192,403		(192,500	)	0		0		0
June 22, 2006 – common stock issued for stock options at $0.18	41,667		4		7,496		0		0		0		7,500
September 19, 2006 – common stock issued for stock options at $0.09	60,000		6		5,394		0		0		0		5,400
December 13, 2006 – common stock issued for stock options at $0.09	200,000		20		17,980		0		0		0		18,000
December 14, 2006 – common stock issued for consulting services at $0.19	100,000		10		18,990		0		0		0		19,000
Stock based compensation	0		0		66,600		0		0		0		66,600
Unrealized gain on available-for-sale securities	0		0		0		0		0		(569	)	(569	)
Deferred compensation expense	0		0		0		1,854,517		0		0		1,854,517
Rounding adjustment	21		(2	)	2		0		0		0		0
Net loss	0		0		0		0		(2,954,033	)	0		(2,954,033	)

Balance, December 31, 2006	15,528,624		1,553		16,726,244		(150,490	)	(16,905,999	)	(684	)	(329,376	)
February 1, 2007 – common stock issued for stock options at $0.09	170,000		17		15,283		0		0		0		15,300
April 3, 2007 – common stock issued for stock options at $0.09	305,000		30		27,420		0		0		0		27,450
April 13, 2007 – common stock issued for stock options at $0.09	265,000		27		23,823		0		0		0		23,850
April 30, 2007 – common stock issued for stock options at $0.09	250,000		25		22,475		0		0		0		22,500
April 30, 2007 – common stock issued for consulting services at $0.30	7,500		1		2,249		0		0		0		2,250
June 1, 2007 - common stock issued for private placement at $0.25	200,000		20		49,980		0		0		0		50,000
June 11, 2007 - return and cancellation of common stock	(30,000	)	(3	)	(2,697	)	0		0		0		(2,700	)
June 21, 2007 - common stock issued for stock options at $0.09	140,000		14		12,586		0		0		0		12,600
June 26, 2007 – common stock issued for stock options at $0.10	200,000		20		19,980		0		0		0		20,000
July 13, 2007 - common stock issued for stock options at $0.10	50,000		5		4,995		0		0		0		5,000
July 30, 2007 - return and cancellation of common stock	(50,000	)	(5	)	(4,995	)	0		0		0		(5,000	)
August 15, 2007 - common stock issued for deferred compensation at $0.18	200,000		20		35,980		(36,000	)	0		0		0
October 26, 2007 - commons stock issued for stock options at $0.09	30,000		3		2,697		0		0		0		2,700
October 26, 2007 - commons stock issued for stock options at $0.10	500,000		50		49,950		0		0		0		50,000
November 1, 2007 - return and cancellation of common stock	(250,000	)	(25	)	(24,975	)	0		0		0		(25,000	)
November 2, 2007 - commons stock issued for stock options at $0.10	250,000		25		24,975		0		0		0		25,000
November 7, 2007 - common stock issued for stock options at $0.10	400,000		40		39,960		0		0		0		40,000
November 7, 2007 - return and cancellation of common stock	(100,000	)	(10	)	(9,990	)	0		0		0		(10,000	)
November 20, 2007 - return and cancellation of common stock	(250,000	)	(25	)	(24,975	)	0		0		0		(25,000	)
November 21, 2007 - commons stock issued for stock options at $0.10	250,000		25		24,975		0		0		0		25,000
November 21, 2007 - common stock issued for private placement at $0.20	25,000		2		4,998		0		0		0		5,000
December 20, 2007 - return and cancellation of common stock	(150,000	)	(15	)	(14,985	)	0		0		0		(15,000	)
Stock based compensation	0		0		228,000		0		0		0		228,000
Unrealized gain on available-for-sale securities	0		0		0		0		0		587,218		587,218
Deferred compensation expense	0		0		0		84,668		0		0		84,668
Rounding adjustment	170		0		0		0		0		0		0
Net Loss	0		0		0		0		(422,958	)	0		(422,958	)


Balance, December 31, 2007	17,941,294		1,794		17,233,953		(101,822	)	(17,328,957	)	586,534		391,502

F-8

February 27, 2008 – common stock issued for director services at $0.11	30,000	3	3,297	3,300
May 16, 2008 - commons stock issued for stock options at $0.10	250,000	25	24,975	25,000
June 2, 2008 - commons stock issued for stock options at $0.10

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