UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~March 3031, ~~2017~~2018

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

For the transition period from ____________ to ~~____________~~ ________________.

Commission File Number: 001-37696

FIRST NATIONAL ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

Nevada

66-0349372

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

44 Greystone Crescent, Georgetown, Ontario Canada L7G 1G9

(Address of principal executive offices) (Zip Code)

(416) 918-6987

(Registrant’s telephone number, including area code)

(Former Name, Former Address, and Former Fiscal Year, if Changed Since Last Report)

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. [X] Yes [ ] 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

[X] Yes [ ] No

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

Large accelerated filer [ ]		Accelerated filer [ ]

Non-Accelerated filer [ ]	Smaller reporting company [X]	Emerging growth company [ ]

(Do not check if a smaller reporting company)

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes [ ] No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of ~~June~~March 3031, ~~2017~~2018, there were 99100,~~915~~195,228 common shares issued and outstanding.

Transitional Small Business Disclosure Format Yes [ ] No [X]

First National Energy Corporation

Interim Consolidated Financial Statements

~~June~~March 3031, ~~2017~~2018

(Amounts expressed in US Dollars)

(unaudited)

Index

Interim Consolidated Balance Sheets as at June 30, 2017 (unaudited) and December 31, 2016 (audited)	3
Interim Consolidated Balance Sheets as at March 31, 2018 (unaudited) and December 31, 2017 (audited)		3
Interim Consolidated Statements of Operations and Comprehensive Loss for the six and three months ended June 30, 2017 (unaudited) and June 30, 2016 (unaudited)	4
Interim Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2018 (unaudited) and March 31, 2017 (unaudited)		4
Interim Consolidated Statements of Stockholders’ Deficiency for the six months ended June 30, 2017 (unaudited) and year ended December 31, 2016 (audited)	5
Interim Consolidated Statements of Stockholders’ Deficiency for the three months ended March 31, 2018 (unaudited) and year ended December 31, 2017 (audited)		5
Interim Consolidated Statements of Cash Flows for the six months ended June 30, 2017 (unaudited) and June 30, 2016 (unaudited)	6
Interim Consolidated Statements of Cash Flows for the three months ended March 31, 2018 (unaudited) and March 31, 2017 (unaudited)		6
Notes to Interim Consolidated Financial Statements	7 - 12
Condensed Notes to Interim Consolidated Financial Statements		7 – 13

The accompanying notes form an integral part to these consolidated interim financial statements

Page 2

FIRST NATIONAL ENERGY CORPORATION

~~Interim~~ Consolidated Balance Sheets

As of ~~June~~March 3031, ~~2017~~2018 and December 31, ~~2016~~2017

(Amounts Expressed US Dollars)

	2017			2016
	March 31, 2018			December 31, 2017
	$			$
	$ (unaudited)			$ (audited)
	(unaudited)			(audited)
ASSETS
CURRENT
Cash		~~1,689~~644			~~1,059~~644
Total Current Assets		~~1,689~~644			~~1,059~~644
LICENSES FOR TECHNOLOGY (Note 4)		200			200
Total assets		~~1,889~~844			~~1,259~~844
LIABILITIES
CURRENT
Accounts payable and accrued liabilities		3239,~~493~~818			4436,~~456~~118
Loan payable to director (note 7)		141,046			125,117
Loan payable to director (Note 8 a))		153,179			149,716
Loan payable (note 6)		-			540,000
Loan payable to related party (Note 5, Note 8 b))		540,000			540,000
Loan payable to related party (note 6)		540,000			-
Total current liabilities		732,997			725,834
Total current liabilities		713,539			709,573
Going Concern (Note 2)
Related Party Transactions (Note7)
Related Party Transactions (Note 8)
Commitment and Contingencies (Note 10)
STOCKHOLDERS’ DEFICIENCY
Capital Stock (note 8)		99,815			99,765
Capital Stock (Note 6)		100,095			100,095
Additional paid-in Capital		~~123~~262,~~279~~999			~~103~~262,~~329~~999
Accumulated Deficit		(~~934~~1,~~787~~095,290	)		(~~911~~1,~~451~~088,127	)
Accumulated Other Comprehensive Loss		(10	)		(10	)
Total Stockholders’ Deficiency Attributable to the Company’s Stockholders		(~~711~~732,~~703~~206	)		(~~708~~725,~~367~~043	)
Non-controlling interest		53			53
Total Stockholders’ Deficiency		(~~711~~732,~~650~~153	)		(~~708~~724,~~314~~990	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIENCY		~~1,889~~844			~~1,259~~844

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

Page 3

FIRST NATIONAL ENERGY CORPORATION

Interim Consolidated Statements of Operations and ~~Other~~ Comprehensive Loss

For the ~~six and~~ three months ended March 31,

(Amounts Expressed in US Dollars)

	6 months ended June 30						3 months ended June 30
	2018			2017
	2017			2016			2017			2016
	$ (unaudited)			$ (unaudited)
	$			$			$			$
REVENUE		-			-
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
EXPENSES
REVENUE		-			-			-			-
General and administrative		7,163			19,272
EXPENSES
TOTAL OPERATING EXPENSES		7,163			19,272
General and administrative		23,336			(16,025	)		4,064			(28,417	)
LOSS BEFORE INCOME TAXES		(7,163	)		(19,272	)
Total Operating Expenses		23,336			(16,025	)		4,064			(28,417	)
Income taxes		-			-
INCOME (LOSS) BEFORE INCOME TAXES		(23,336	)		16,025			(4,064	)		28,417
NET LOSS AND COMPREHENSIVE LOSS		(7,163	)		(19,272	)
Income taxes		-			-			-			-
Net loss and comprehensive loss attributable to the Company’s stockholders		(7,163	)		(19,272	)
NET INCOME (LOSS)		(23,336	)		16,025			(4,064	)		28,417
Net loss and comprehensive loss attributable to non-controlling interest		-			-
Net Income (Loss) and comprehensive Income (loss) attributable to the Company’s stockholders		(23,336	)		16,025			(4,064	)		28,417
		(7,163	)		(19,272	)
Net Income (Loss) and comprehensive Income (loss) attributable to non-controlling interests		-			-			-			-
Net loss per share - basic and diluted	$	(0.00	)	$	(0.00	)
NET AND COMPREHENSIVE INCOME (LOSS)		(23,336	)		16,025			(4,064	)		28,417
Weighted average common shares outstanding		100,195,228			99,900,942
Net earnings (loss) per share – basic and diluted	$	(0.00	)	$	0.00		$	(0.00	)	$	0.00
Weighted average common shares outstanding		99,908,046			99,865,228			99,915,228			99,865,228

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

Page 4

FIRST NATIONAL ENERGY CORPORATION

Interim Consolidated Statements of Changes in Stockholders’ Deficiency

For the ~~six~~three months ended ~~June~~March 3031, ~~2017~~2018 and year ended December 31, ~~2016~~2017

(Amounts Expressed in US Dollars)

											Accumulated
	Number of		Common		Additional						Other			Non-				Total
	Common		Shares		Paid-in			Accumulated			Comprehensive			controlling				Stockholders’
	Shares		Amount		Capital			Deficit			Loss			~~Interests~~Interest				Deficiency
			$	$	$	$		$	$		$			$	$			$	$
Balance as of December 31, 2014		99,865,228		99,765		103,329			(876,475	)		(10	)		58				(673,338	)
Net loss for the year		-		-		-			(22,612	)		-			(5	)			(22,612	)
Balance as of December 31, 2015		99,865,228		99,765		103,329			(899,087	)		(10	)		53				(695,950	)
Net loss for the year		-		-		-			(12,364	)		-			-				(12,364	)
Balance as of December 31, 2016 (audited)		99,865,228		99,765		103,329			(911,451	)		(10	)		53				(708,314	)
Balance as of December 31, 2016		99,865,228		99,765		103,329			(911,451	)		(10	)		53				(708,314	)
Sales of 50,000 shares of common stock		50,000		50		24,950			-			-			-				25,000
Sale of 50,000 shares of common stock		50,000		50		24,950													25,000
Financing Costs						(5,000	)												(5,000	)
Net loss for the period		-		-		-			(23,336	)		-			-		-		(23,336	)
Sale of 30,000 shares of common stock		30,000		30		14,970													15,000
Balance as of June 30, 2017 (unaudited)		99,915,228		99,815		123,279			(934,787	)		(10	)		53				(711,650	)
Share-based compensation		250,000		250		124,750													125,000
Net loss for the year		-		-		-			(176,676	)		-			-				(176,676	)
Balance as of December 31, 2017 (audited)		100,195,228		100,095		262,999			(1,088,127	)		(10	)		53				(724,990	)
Net loss for the period		-		-		-			(7,163	)		-			-				(7,163	)
Balance as of March 31, 2018 (unaudited)		100,195,228		100,095		262,999			(1,095,290	)		(10	)		53				(732,153	)

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

Page 5

FIRST NATIONAL ENERGY CORPORATION

~~Interim~~ Consolidated Statements of Cash Flows

For the ~~six~~three months ended ~~June~~March 3031,

(Amounts Expressed in US Dollars)

	2017			2016
	2018			2017
	$	$		$	$
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)		(23,336	)		16,025
Net loss		(7,163	)		(19,272	)
Decrease in accounts payable and accrued liabilities		(11,963	)		(26,584	)
Increase (Decrease) in accounts payable and accrued liabilities		3,700			(14,511	)
Net cash used in operating activities		(353,~~299~~463	)		(1033,~~560~~783	)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in loan from director		153,~~929~~463			917,~~683~~283
Issuance of shares		25,000			-
Sale of shares, net of financing expenses		-			16,500
Less share issuance finance cost		(5,000	)
Net cash provided by financing activities		3,463			33,783
Purchase of Intangible		-			(1	)
NET DECREASE IN CASH		-			-
Net cash provided by financing activities		35,929			9,682
Cash, beginning of year		644			1,059
NET INCREASE (DECREASE) IN CASH		630			(878	)
CASH, END OF PERIOD		644			1,059
Cash, beginning of period		1,059			1,937
CASH, END OF PERIOD		1,689			1,059

The accompanying notes ~~form~~are an integral part toof these ~~consolidated~~ interim consolidated financial statements.

Page 6

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

~~June 30~~March 31, ~~2017~~2018

(Amounts expressed in US Dollars)

1. NATURE OF OPERATIONS AND PURCHASE OF TECHNOLOGY

a) Nature of operations

First National Energy Corporation (the “Company”) was incorporated in the State of Delaware on November 16, 2000~~, under the name Capstone International Corporation~~. On March 28, 2004, the Company changed its name to First National Power Corporation. On February 12, 2009, the Company relocated its charter to the State of Nevada and changed its name to First National Energy Corporation. As part of its reorganization, the Company increased its authorized capital to 300 million common shares and effected a 100 for 1 reverse stock split of its issued and outstanding shares of common stock. The accompanying consolidated financial statements reflect all share data based on the 100 for 1 reverse common stock split.

The Company’s business purpose is the provision of wind-driven solutions for power generation. Current projects for the Company are the completion of power generation projects from supplemental wind generation technologies.

The company is close to commence marketing its product and has been trying to establish the use of its technology in various applications.

b) Purchase of Technology License

On April 20, 2009, the Company entered into a preliminary letter of intent with Boreas Research Corporation (“Boreas”), a Florida corporation, pursuant to which the Company would acquire a territorial license to certain rights in alternative energy technology of Boreas, in exchange for a quantity of newly issued common shares of the Company. The letter of intent was superseded by a Technology License and Stock Purchase Agreement (the “Agreement”) between the Company and Boreas that was consummated on May 25, 2009 (the “Closing”), at which time the Company issued to the stockholders of Boreas 98,800,000 new restricted and unregistered common shares of the Company and agreed to pay certain future royalties to Boreas from net revenues realized by the Company from the technology license. The consideration issued in the transaction was determined as a result of arm’s-length negotiations between the parties.

The preliminary letter of intent was reported by the Company on form 8-K to the Securities and Exchange Commission (“SEC”) on April 21, 2009, and the Agreement was annexed to an information statement on form 14-C filed with the SEC in preliminary and definitive forms on April 22, 2009 and May 4, 2009, respectively. The definitive information statement was mailed to the Stockholders of the Company on May 4, 2009.

The Company obtained written consent to the Agreement and the transaction from the holders of 55.82% of its issued and outstanding shares of common stock in lieu of a meeting of stockholders.

In exchange for the Company acquiring the technology license from Boreas at the Closing pursuant to the Agreement (as amended by the Amendment), the Stockholders of Boreas received an aggregate of 98,800,000 new restricted and unregistered common shares of the Company’s common stock. Accordingly, the Boreas Stockholders now own 98.93% of the Company’s 99,865,228 outstanding common shares. No finder’s fees were paid or consulting agreements entered into by the Company in connection with the transaction.

Prior to the transaction, there were no material relationships between the Company and Boreas, between Boreas and the Company’s affiliates, directors or officers, or between any associates of Boreas and the Company’s officers or directors. All of the Company’s transaction liabilities were settled on or immediately following the Closing.

Page 7

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

~~June 30~~March 31, ~~2017~~2018

(Amounts expressed in US Dollars)

1. NATURE OF OPERATIONS AND PURCHASE OF TECHNOLOGY (cont’d)

b) Purchase of Technology License (cont’d)

Upon the Closing on May 25, 2009, the Company was no longer deemed to be a “shell company” as defined in Rule 12b-2 under the Securities Exchange Act of 1934 (the “Exchange Act”). Accordingly, the Company filed an amended current report on Form 8-K/A with the SEC on May 26, 2009, setting forth the information that would be required if the Company were filing a general form for registration of securities on Form 10 under the Exchange Act.

On April 18, 2011, First National Energy Corporation (the “Company”) entered into a Novation Agreement (the “Novation”) with all of the stockholders of Boreas revising the structure of the May 25, 2009 transaction by which the Company acquired a territorial license to certain rights in alternative energy technology of Boreas, in exchange for a quantity of newly issued common shares of the Company. The Novation amended the Technology License and Stock Purchase Agreement (the “Original Agreement”) to substitute the stockholders of Boreas as the licensor under the Original Agreement.

The Company has been looking into the commercial applicability of this technology in various applications.

c) Further Purchase of Technology License

On March 22, 2010, Pavana Power Corporation (“Pavana”), a Nevada corporation, the Company’s 99.9% owned subsidiary, acquired an exclusive, territorial, 25-year license for the Republic of India (“India”), from Boreas, pursuant to which the Company’s subsidiary acquired technology rights for India in the technology of Boreas that maximizes the energy productivity of existing wind turbines by capturing energy that flows through and underneath existing wind turbine systems. The consideration due from the Company’s subsidiary to Boreas for the license is a deferred cash payment of $600,000, and a future royalty equal to 5% of the subsidiary’s “EBITDA” (earnings before interest, taxes, depreciation and amortization) from exploitation of the acquired license.

The Company has been looking into the commercial applicability of this technology in various applications.

2. GOING CONCERN

The Company’s consolidated financial statements are prepared using accounting principles generally accepted in the United States of America and applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. Although the Company is close to commence marketing its product and has been trying to establish the ~~However~~use of its technology in various applications, the Company has not generated any revenues from its planned principal operations through ~~June~~March 3031, ~~2017~~2018. ~~and~~The Company has ~~recorded~~ recurring losses since inception, has negative working capital, has yet to achieve profitable operations and expects further losses in the development of its business. There can be no assurance that the Company will have adequate capital resources to fund planned operations or that any additional funds will be available to the Company when needed, or if available, will be available on favorable terms in the amounts required by the Company. These conditions raise substantial doubt about the Company'’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Management has plans to raise cash through debt offerings once the sales of the technologies begin. The facilities and equipment required for successfully completing the business model have been identified but until the resources are available, have not been acquired or engaged. In the period prior to the onset of operations, the Company will undertake to raise further cash through further capital offerings. There is no assurance that the Company will be successful in raising additional capital.

Page 8

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

~~June 30~~March 31, ~~2017~~2018

(Amounts expressed in US Dollars)

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) Basis of Presentation and Consolidation

The ~~unaudited~~ interim consolidated financial statements include the accounts of First National Energy Corporation, its wholly-owned subsidiary First National Energy (Canada) Corporation and its 99.99% owned subsidiary Pavana Power Corporation. All material inter-company amounts have been eliminated.

The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 8-03 of Regulation S-X related to smaller reporting companies.

The unaudited interim consolidated financial statements should be read in conjunction with the financial statements and Notes thereto together with management’s discussion and analysis of financial condition and results of operations contained in the Company’s annual report on Form 10-K for the year ended December 31, ~~2016~~2017. In the opinion of management, the accompanying unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature considered necessary to fairly state the financial position of the Company at ~~June~~March 3031, ~~2017~~2018, the results of its operations for the ~~six and~~ three months ended ~~June~~March 3031, ~~2017~~2018 and ~~2016~~ 2017, and its cash flows for the ~~six~~three months ended ~~June~~March 3031, ~~2017~~2018 and ~~2016~~2017. In addition, some of the Company’s statements in its quarterly report on Form 10-Q may be considered forward-looking and involve risks and uncertainties that could significantly impact expected results. The results of operations for the ~~six~~three months ended ~~June~~March 3031, ~~2017~~2018 are not necessarily indicative of results to be expected for the full year.

b) ~~2016~~ 2017 Omnibus Equity Compensation Plan

On In February 12017, ~~2016,~~ the Board of Directors approved the ~~2016~~2017 Omnibus Equity Compensation Plan (“Stock Option Plan”) for employees and non-employees. The Stock Option Plan reserves up to five million shares of common stock for issuance.

All awards granted to employees and non-employees after February 1, ~~2016~~2017 are valued at fair value by using the Black-Scholes option pricing model and recognized on a straight line basis over the service periods of each award. The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees using the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earlier of a performance commitment or completion of performance by the provider of goods or services.

If there is a modification of the terms of an award, either by repricing or extending the expiry of the award, the award is re-measured. If the modification results in an increase in the fair value of the new award as compared to the old award immediately prior to the modification, the excess fair value is recognized as compensation expense.

As of ~~June~~March 3031, ~~2017~~2018, there was $nil of ~~recognized~~ expense recognized related to non-vested stock-based compensation arrangements granted.

Page 9

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

~~June 30~~March 31, ~~2017~~2018

(Amounts expressed in US Dollars)

4. LICENSES FOR TECHNOLOGY

	2017				2016
	Cost		Net Book Value		Net Book Value
North American Technology License	$	100	$	100	$	100
Indian Technology License	$	100	$	100	$	100
Total	$	200	$	200	$	200

Licenses are recorded at carrying amount. No amortization was recorded during the year.

5. INTANGIBLE ASSET

	2018		2018		2017
	Cost		Net Book Value		Net Book Value
	$		$		$
North American
Technology License		100		100		100
Indian Technology		100		100		100
License		200		200		200

~~Effective February~~ 5~~, 2016, the~~. ~~Company~~LOAN ~~acquired~~PAYABLE ~~VAWT/VRTB/Bolotov~~TO ~~Rotor~~RELATED wind turbine technology (“Technology”) from Bolotov and affiliates (“Serge Bolotov”). The technical and intellectual property were designed, patented, developed and manufactured by Serge Bolotov.PARTY

The Company valued this technology under the guidance of ASC 350, Intangibles-Goodwill and Other which states that an intangible asset that is acquired either individually or with a group of other assets shall be initially measured based on its fair value. As there is no active market and the future cash flows and economic viability of this intellectual property are uncertain and cannot be measured reliably, no value was assigned to the technology.

The future compensation to Serge Bolotov consists of:

	-	10% of all profits generated by sale of this technology as royalties
	-	A purchase bonus of $1,000,000 to be paid out of 11% of the net profits from the intellectual property. (See also note 11)

In the event the Company or a related or assigned party does not use the assets transferred in the transaction within a period of 3 years from the date the memorandum of understanding was accepted as a final agreement on February 5th 2016, Serge Bolotov will have the right, but not the obligation, to purchase all unused assets, following ten days written notice to the Company or a related or assigned party for the amount of US $5,000.

6. LOAN PAYABLE TO RELATED PARTY

On March 22, 2010, the Company acquired an exclusive territorial 25 year Supplemental Wind Energy Generator (“SWEG”) Technology license for the Republic of India (“India”), from Boreas. The stockholders of Boreas hold a controlling interest in the Company through their controlling interest in First National Energy Corporation. The technology of Boreas maximizes the energy productivity of existing wind turbines by capturing energy that flows through and underneath existing wind turbine systems. The consideration due from the Company to Boreas was a deferred cash payment of $600,000, and a future royalty equal to 5% of the subsidiary’s “EBITDA” (earnings before interest, taxes, depreciation and amortization) from exploitation of the acquired license.

On November 8, 2010, the Pavana subsidiary paid Boreas $60,000 as a payment due under the India technology license agreement, leaving a balance of cash consideration due of $540,000. The remaining debt is non-interest bearing and is due on demand.

On October 28, 2016, Boreas assigned its loan receivable to one of the shareholders. The amount previously owed by the Company to Boreas is now owed to a shareholder of the Company. The loan to the shareholder is unsecured, has no conversion features, non-interest bearing, and due on demand. Also see Note 8 b).

6. CAPITAL STOCK

a) Authorized

300,000,000 Common shares, $0.001 per value

b) Issued

100,195,228 Common shares (2017: 100,195,228 Common shares) valued at $100,095 (2017: $100,095)

Page 10

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

~~June 30~~March 31, ~~2017~~2018

(Amounts expressed in US Dollars)

67. INTANGIBLE ~~LOAN PAYABLE TO RELATED PARTY (cont’d)~~ASSET

OnEffective February ~~October 28~~5, 2016, ~~Boreas assigned its loan receivable due from~~ the Company toacquired ~~one~~VAWT/VRTB/Bolotov ofRotor ~~the~~wind ~~Company’s~~turbine ~~shareholders.~~technology ~~The~~(“Technology”) ~~amount~~from ~~previously owed by the Company~~Bolotov toand ~~Boreas~~affiliates is(“Serge ~~now owed to a shareholder of the Company~~Bolotov”). The ~~loan~~technical toand ~~shareholder~~intellectual isproperty ~~non-interest~~were ~~bearing~~designed, ispatented, ~~due~~developed ~~on demand~~ and ~~has~~manufactured noby ~~security~~Serge ~~or conversion features~~Bolotov.

7The Company valued this technology under the guidance of ASC 350, Intangibles-Goodwill and Other which states that an intangible asset that is acquired either individually or with a group of other assets shall be initially measured based on its fair value. As ~~LOAN~~there ~~PAYABLE~~is TOno ~~DIRECTOR~~active ~~AND~~market ~~RELATED~~and ~~PARTY~~the ~~TRANSACTIONS~~future cash flows and economic viability of this intellectual property are uncertain and cannot be measured reliably, no value was assigned to the technology.

The future compensation to Serge Bolotov consists of:

	-	10% of all profits generated by sale of this technology as royalties
	-	A purchase bonus of $1,000,000 to be paid out of 11% of the net profits from the intellectual property. (See also Note 10)

In the event the Company or a related or assigned party does not use the assets transferred in the transaction within a period of 3 years from the date the memorandum of understanding was accepted as a final agreement on February 5^th, 2016, Serge Bolotov will have the right, but not the obligation, to purchase all unused assets, following ten days written notice to the Company or a related or assigned party for the amount of US $5,000.

8. LOAN PAYABLE TO DIRECTOR AND RELATED PARTY TRANSACTIONS

Transactions with related parties are incurred in the normal course of business and are measured at the exchange amount which is the amount of consideration established by and agreed to by the related parties.

A director of the Company has advanced monies to the Company to pay certain expenses. The advances have no interest rate and is due on demand. The amount owing to the director was $141,046 ($125,117 in 2016).

a)	The amount represents advances from a director to support the Company’s working capital. These advances are unsecured, non-interest bearing and are due on demand.

b)	The loan payable to related party is payable to a shareholder. There was no movement during the period. Also see Note 5.

89. SEGMENT ~~CAPITAL STOCK~~DISCLOSURE

a)The Company, ~~Authorized~~after reviewing its reporting systems, has determined that it has one reportable segment and geographic segment. The Company’s operations are all related to the provision of wind-driven solutions for power generation. All assets of the business are located in the United States of America.

300,000,000 Common shares, $0.001 per value

b) Issued

99,915,228 Common shares (2016: 99,865,228 Common shares) valued at $99,815 (2016: $99,765).

In 2017, the Company offered up to 500,000 shares of common stock at a price of $0.50 per share, $.0001 par value (the “Offering”). On January 27, 2017, in connection with the Offering, the Company issued and sold on a private placement basis, 50,000 shares at a price of $0.50 per share for total proceeds of $25,000. Financing expenses in the amount of $5,000 pursuant to the private placement were recorded as a reduction in additional paid-in capital.

9. SEGMENTED INFORMATION

The Company, after reviewing its operating systems, has determined that it has no reportable segment and geographic segment. The Company’s operations are all related to the provision of wind-driven solutions for power generation. All assets of the business are located in the United States of America.

10. COMMITMENT AND CONTINGENCIES

a) Pursuant to Note 1 (c), under the Technology License purchased by Pavana, the Company has a commitment for royalties at 5% of earnings before interest, taxes, depreciation and amortization (“EBITDA”) derived by Pavana using this technology.

b) Pursuant to the purchase of intellectual property from Serge Bolotov (the “vendor”), the Company has the following commitments related to the purchase:

	i.	As consideration for the transaction, the vendor shall be paid 10% of the profits realized by the Company or a related or assigned party and a signing bonus of $1,000,000 to be derived from 11% of the initial profits from the intellectual property.
	ii.	Following completion of sufficient funding of the Company or related or assigned party, the following shall occur: the vendor will be paid the sum of $8,000 CAD per month in cash or shares, as long as the vendor is needed as a consultant with the Company or a related or assigned party. The Company or related or assigned party will provide research and development facility with support staff.

Page 11

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

~~June 30~~March 31, ~~2017~~2018

(Amounts expressed in US Dollars)

10. COMMITMENT AND CONTINGENCIES ~~(cont’d)~~

	iii.	The Company or a related or assigned party will act to appoint Serge Bolotov as a member of the Board of Directors. Upon successful appointment to the Board, the Company or a related or assigned party will issue the vendor 100,000 common shares as compensation for his Board of Director appointment and Director services. As at December 31, 2016, the vendor has not yet been appointed to the Board.
a)	Pursuant to Note 1 (c), under the Technology License purchased by Pavana, the Company has a commitment for royalties at 5% of earnings before interest, taxes, depreciation and amortization (“EBITDA”) derived by Pavana using this technology. No amounts have been paid as the Company has not commenced any commercial activity.
	iv.	The Company or a related or assigned party will act to appoint Serge Bolotov as a member of the Board of Directors. Upon successful appointment to the Board, the Company or a related or assigned party will issue the vendor 100,000 common shares as compensation for his Board of Director appointment and for Director services. As of June 30, 2017, the vendor has not yet been appointed to the Board.
b)	Pursuant to the purchase of intellectual property from Serge Bolotov (the “vendor”), the Company has the following commitments related to the purchase:

	c)	Effective February 1, 2016, the Company executed an agreement with legal counsel to pay a monthly fee of $2,500 commencing February 1, 2016 with respect to legal matters of securities regulation, private placements, corporate governance, and related matters in connection with the Company. The two parties reserve the right to terminate or withdraw from the agreement at any time.
	d)	Pursuant to Note 1 (b), under the Technology License and Stock Purchase Agreement signed with Boreas, the Company agreed to pay certain future royalties to Boreas from net future revenues realized by the Company from the technology license.

	i.	As consideration for the transaction, the vendor shall be paid 10% of the profits realized by the Company or a related or assigned party and a signing bonus of $1,000,000 to be derived from 11% of the initial profits from the intellectual property.

	ii.	Following completion of sufficient funding of the Company or related or assigned party, the following shall occur: the vendor will be paid the sum of $8,000 CAD per month in cash or shares, as long as the vendor is needed as a consultant with the Company or a related or assigned party. The Company or related or assigned party will provide research and development facility with support staff.

	iii.	The Company or a related or assigned party will act to appoint Serge Bolotov as a member of the Board of Directors. Upon successful appointment to the Board, the Company or a related or assigned party will issue the vendor 100,000 common shares as compensation for his Board of Director appointment and Director services. As at March 31, 2018, the vendor has not yet been appointed to the Board.

The above commitments are not due as none of the conditions have been met.

c)	Effective February 1, 2016, the Company executed an agreement with legal counsel to pay a monthly fee of $2,500 with respect to legal matters of securities regulation, private placements, corporate governance, and related matters in connection with the Company. The two parties reserve the right to terminate or withdraw from the agreement at any time. As of March 31, 2018, no amounts have been accrued in these consolidated financial statements. The legal counsel waived its right to bill agreed upon monthly amounts as no such services have been performed due to the limited commercial activity.

d)	Pursuant to Note 1 (b), under the Technology License and Stock Purchase Agreement signed with Boreas, the Company agreed to pay certain future royalties to Boreas from net future revenues realized by the Company from the technology license. No amounts have been accrued as none of the conditions have been met.

11. CAPITAL MANAGEMENT

The Company’s capital management objective is to secure the ability to continue as a going concern and to optimize the cost of capital in order to enhance value to shareholders. As part of this objective, the Company seeks to maintain access to loan and capital markets at all times. The Board of Directors reviews the capital structure of the Group on a regular basis.

Capital structure and debt capacity are taken into account when deciding new investments and the Company may consider share buybacks and share issuances as other strategies. Debt capital is managed considering the requirement to secure liquidity and the capability to refinance maturing debt.

OnAs at ~~June~~March 3031, ~~2017,~~2018 the Company ~~had~~ has no interest-bearing debt.

Page 12

FIRST NATIONAL ENERGY CORPORATION

Condensed Notes to the Interim Consolidated Financial Statements

March 31, 2018

(Amounts expressed in US Dollars)

12. FINANCIAL INSTRUMENTS

The Company is exposed to risks that arise from its use of financial instruments. This note describes the Company’s objectives, policies and processes for managing those risks and the methods used to measure them.

Foreign exchange risk:

The Company’s subsidiary conducts its activities in Canadian dollars. The Company is therefore subject to gains or losses due to fluctuations in Canadian currency relative to the US dollar. The Company has no exposure to this given its limited activity and assets through the year.

Liquidity risk:

The Company monitors its liquidity position regularly to assess whether it has the funds necessary to fulfill planned commitments on its alternative energy technology or viable options are available to fund such commitments from new equity issuance or alternative ~~sources~~ sources such as debt financing. However, without significant internally generated cash flow, there are inherent liquidity risks, including the possibility that additional financing may not be available to the Company, or that actual development ~~expenditures~~ expenditures may exceed those planned. The current uncertainty in global markets could have an impact on the Company’s future ability to access capital on terms that are acceptable to the Company. The ~~company~~Company has so far been able to raise the required financing to meet its obligations on time. The Company continues to pursue potential investees ~~and have already secured additional equity financing from investors subsequent to the year end~~.

~~Page~~13. 2017 12OMNIBUS EQUITY COMPENSATION PLAN

~~Item~~In February 2.2017, ~~Management’s~~the ~~Discussion~~Company ~~and~~adopted ~~Analysis~~the 2017 Omnibus Equity Compensation Plan. 5,000,000 shares of ~~Financial~~common ~~Condition~~stock ~~and~~were ~~Results~~reserved pursuant to the Omnibus Equity Compensation Plan. As at March 31, 2018, the Company has not yet issued any shares of ~~Operations~~common stock under this plan.

~~Unless~~Page otherwise indicated, references in this Quarterly Report on Form 10-Q to “we,” “us,” and “our” are to the Company, unless the context requires otherwise. The following discussion and analysis by our management of our financial condition and results of operations should be read in conjunction with our unaudited condensed interim financial statements and the accompanying related notes included in this quarterly report and our audited financial statements and related notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission.13

~~Cautionary~~Item 2. ~~Statement~~Management’s ~~Regarding~~Discussion ~~Forward-Looking Statements~~and Analysis of Financial Condition and Results of Operations.

~~This~~Unless otherwise ~~report~~indicated, ~~may~~references ~~contain~~in ~~forward-looking~~this ~~statements within~~Quarterly ~~the~~Report ~~meaning~~on ofForm ~~Section~~10-Q ~~27A~~to of“we,” ~~the~~“us,” ~~Securities~~and ~~Act~~“our” are ~~and~~to ~~Section~~the ~~21E~~Company, ofunless the ~~Securities~~context ~~Exchange~~requires ~~Act,~~otherwise. ~~and~~The wefollowing ~~intend~~discussion ~~that~~and ~~such forward-looking~~analysis ~~statements~~by beour ~~subject~~management toof ~~the~~our ~~safe~~financial condition ~~harbors~~and ~~created~~results ~~thereby.~~of ~~These~~operations ~~forward-looking~~should ~~statements~~be ~~are~~read ~~based~~in onconjunction with our ~~management’s beliefs~~unaudited ~~and~~condensed ~~assumptions~~interim financial statements and the onaccompanying ~~information~~related ~~currently~~notes ~~available~~included toin ~~our~~this ~~management.~~quarterly ~~Any~~report ~~such~~and ~~forward-looking~~our audited financial statements ~~would~~and ~~be contained~~related ~~principally~~notes inand “Management’s Discussion and Analysis of Financial Condition and Results of Operations~~” and~~ ~~“Risk~~included ~~Factors.”~~in ~~Forward-looking~~our ~~statements~~Annual ~~include~~Report ~~information~~on ~~concerning~~Form ~~our~~10-K ~~possible~~for orthe ~~assumed future results~~year ofended ~~operations,~~December ~~business strategies~~31, ~~financing~~2017 ~~plans,~~filed ~~competitive~~with ~~position, industry environment, potential growth opportunities and~~ the ~~effects~~Securities ~~of regulation. Forward-looking statements include all statements that are not historical facts~~ and ~~can~~Exchange be identified by terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “hopes,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressionsCommission.

~~Forward-looking statements involve known and~~Cautionary ~~unknown~~Statement ~~risks,~~Regarding uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forwardForward-~~looking~~Looking statements. We discuss many of these risks in greater detail in “Risk Factors.” Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date of this report. You should read this report and the documents that we reference in this report and have filed as exhibits to the report completely and with the understanding that our actual future results may be materially different from what we expect. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.Statements

~~Additional~~This report ~~information~~may ~~concerning~~contain ~~these~~forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities ~~other~~Exchange ~~risks~~Act, and ~~uncertainties~~we isintend ~~contained~~that insuch ~~our~~forward-looking ~~filings~~statements ~~with~~be subject to the ~~Securities~~safe harbors created thereby. These forward-looking statements are based on our management’s beliefs and ~~Exchange~~assumptions ~~Commission,~~and ~~including~~on ~~the~~information ~~section~~currently ~~entitled~~available to our management. Any such forward-looking statements would be contained principally in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors.” inForward-looking statements include information concerning our ~~Annual~~possible ~~Report~~or onassumed ~~Form~~future ~~10-K~~results ~~for~~of operations, business strategies, financing plans, competitive position, industry environment, potential growth opportunities and the ~~year~~effects ~~ended~~of ~~December~~regulation. 31Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipates,” ~~2016~~“believes,” “could,” “estimates,” “expects,” “hopes,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions.

~~Unless~~Forward-looking statements ~~otherwise~~involve ~~indicated~~known orand ~~the~~unknown ~~context~~risks, ~~otherwise~~uncertainties and other factors which may cause our actual results, performance or ~~requires~~achievements to be materially different from any future results, ~~all~~performance ~~references~~or inachievements ~~this~~expressed ~~Form~~or 10implied by the forward-Qlooking statements. toWe discuss many of these risks in greater detail in “~~we,~~Risk Factors.” ~~“us~~Given these uncertainties,” ~~“our~~you should not place undue reliance on these forward-looking statements. Also,” “forward-looking statements represent our ~~Company,”~~management’s ~~“First~~beliefs ~~National~~and ~~Energy~~assumptions ~~Corporation”~~only oras ~~refer~~of tothe ~~First~~date ~~National~~of ~~Energy~~this ~~Corporation~~report. You should read this report and ~~its~~the ~~subsidiaries~~documents that we reference in this report and have filed as exhibits to the report completely and with the understanding that our actual future results may be materially different from what we expect. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

~~Description~~Additional information ofconcerning ~~Business~~these and other risks and uncertainties is contained in our filings with the Securities and Exchange Commission, including the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2016.

~~Business~~Unless otherwise ~~Development~~indicated or the context otherwise requires, all references in this Form 10-Q to “we,” “us,” “our,” “our Company,” “First National Energy Corporation” or refer to First National Energy Corporation and its subsidiaries.

~~We were incorporated as Capstone International~~Description ~~Corporation on November 16, 2000, in the State~~ of Delaware, and our shares were registered with the Securities and Exchange Commission on Form SB-2 as SEC File No. 333-62588, filed on June 8, 2001. Our name was changed to “First National Power Corporation” on January 28, 2004, and was changed again to “First National Energy Corporation” on February 12, 2009, at which time we affected a reverse stock split, adopted a holding company structure, and relocated our corporate charter from Delaware to Nevada as part of the reorganization described in the next succeeding paragraph.Business

~~Page 13~~Business Development

~~As described in the definitive information~~We ~~statement~~were onincorporated ~~Form~~as ~~DEF~~Capstone ~~14-C~~International ~~filed~~Corporation ~~with the Securities and Exchange Commission~~ on ~~December~~November 2216, ~~2008~~2000, ~~and~~in ~~pursuant to~~ the ~~approval of~~State ~~our board~~ of ~~directors and a majority of its stockholders~~Delaware, ~~on February 12, 2009, we effected a reorganization which had the effect of (1) implementing a reverse stock split of its issued~~ and ~~outstanding~~our ~~common~~ shares atwere ~~the rate of 100 to 1, thereby reducing~~registered with the ~~number~~Securities ~~of issued~~ and ~~outstanding~~Exchange ~~common~~Commission ~~shares~~on atForm ~~that~~SB-2 ~~time~~as ~~from~~SEC ~~76,522,760~~File toNo. ~~765~~333-62588,~~228,~~ ~~with~~filed ~~no effect~~ on ~~the~~September ~~number~~8, of2001. ~~authorized common~~Our ~~shares;~~name ~~(2)~~was ~~merging~~changed to ~~our company with and into~~ “First National Power Corporation,” aon ~~Nevada~~January ~~corporation~~28, 2004, and awas ~~wholly-owned indirect~~changed ~~(second~~again ~~tier)~~to ~~subsidiary of our company , such that~~ “First National Energy Corporation,” on aFebruary ~~Nevada~~12, ~~corporation~~2009, ~~and~~at awhich ~~wholly-owned direct~~time ~~(first~~we ~~tier)~~affected ~~subsidiary~~a ofreverse ~~our~~stock ~~company~~split, ~~succeeded~~adopted as a ~~successor~~holding ~~issuer~~company ofstructure, ~~its registered securities~~ and ~~continued~~relocated our ~~business~~ ~~for~~corporate all purposes; (3) exchanging each issued and outstanding share on the record date (and after giving effect to the reverse stock split described above) into one new common share of the successor issuer ; (4) re-domesticating the our charter from ~~the State of~~ Delaware to ~~the State of~~ Nevada; ~~(5)~~as ~~increasing~~part of the ~~authorized~~reorganization ~~capital~~described ~~from~~in ~~100~~the ~~million~~next ~~common~~succeeding ~~shares to 300 million common shares; (6) changing our name from “First National Power Corporation” to “First National Energy Corporation”; and (7) changing our stock symbol from FNPR to FNEC~~paragraph.

OnPage April 20, 2009, we acquired a territorial license to certain rights in alternative wind energy technology in exchange for 98,800,000 newly issued common shares, which resulted in a change in control. We valued the technology license received in such transaction at $1,855,605 after consulting with an outside valuation expert.14

OnAs described ~~April~~in 18the definitive information statement on Form DEF 14-C filed with the Securities and Exchange Commission on December 22, ~~2011~~2008, weand ~~entered~~pursuant ~~into~~to the approval of our board of directors and a ~~Novation~~majority of its stockholders, on February 12, 2009, we ~~Agreement~~effected (a reorganization which had the ~~“Novation”~~effect of (1) ~~with~~implementing ~~all~~a reverse stock split of its issued and outstanding common shares at the ~~stockholders~~rate of ~~Boreas~~100 ~~Research~~to ~~Corporation (“Boreas”)~~1, athereby ~~Florida~~reducing the number of issued and outstanding common shares at that time from 76,522,760 ~~corporation~~to 765,228, ~~revising~~with no effect on the ~~structure~~number of ~~the~~authorized ~~April~~common ~~20,~~shares; ~~2009~~(2) ~~transaction~~merging byour ~~which~~company wewith ~~acquired~~and into First National Power Corporation, a ~~territorial~~Nevada ~~license~~corporation toand ~~certain~~a ~~rights in~~wholly-owned ~~alternative~~indirect ~~energy~~(second ~~technology~~tier) subsidiary of ~~Boreas~~our company , insuch ~~exchange~~that ~~for~~First 98National Energy Corporation,~~800,000~~ a Nevada corporation and a wholly-owned direct (first tier) subsidiary of our ~~common~~company, ~~shares~~succeeded as ~~disclosed~~a ~~above.~~successor issuer ~~The~~of ~~Novation~~its ~~amended~~registered securities and continued our business for all purposes; (3) exchanging each issued and outstanding share on the ~~2009~~record ~~agreement~~date (and after giving effect to ~~substitute~~the reverse stock split described above) into one new common share of the ~~stockholders~~successor issuer ; (4) re-domesticating the our charter from the State of ~~Boreas~~Delaware asto the ~~licensor~~State ~~under~~of Nevada; (5) increasing the ~~original~~authorized capital ~~2009~~from ~~agreement~~100 million common shares to 300 million common shares; (6) changing our name from “First National Power Corporation” to “First National Energy Corporation”; and (7) changing our stock symbol from FNPR to FNEC.

InOn April ~~addition~~20, 2009, we acquired ~~technology~~a ~~rights~~ territorial license to ancertain ~~additional~~rights ~~territory~~in ~~for~~alternative ~~the~~wind ~~licensed~~energy technology ~~through~~in exchange for 98,800,000 newly issued common shares, which resulted in a ~~wholly-owned~~change ~~subsidiary~~in control. We valued the technology license received in such transaction at $1,855,605 ~~Pavana~~after ~~Power~~consulting ~~Corporation~~with an outside valuation expert.

~~Business~~On April 18, 2011, we entered into a Novation Agreement (the “Novation”) with all of ~~Issuer~~the stockholders of Boreas Research Corporation (“Boreas”), a Florida corporation, revising the structure of the April 20, 2009 transaction by which we acquired a territorial license to certain rights in alternative energy technology of Boreas, in exchange for 98,800,000 of our common shares as disclosed above. The Novation amended the 2009 agreement to substitute the stockholders of Boreas as the licensor under the original 2009 agreement.

Since acquiring the technology license described above, our management has expended significant time seeking sources of capital to implement our business plan, which is primarily designed to exploit the licensed technology throughout the United States and Canada for commercial gain. In addition, we ~~have~~ acquired technology rights to an additional territory for the licensed technology. ~~Management~~through isa ~~also~~wholly-owned ~~evaluating other alternatives in order to improve our financial condition~~subsidiary, ~~including merger and acquisition opportunities. There is no assurance that we will be successful~~ inPavana ~~raising~~Power ~~capital or closing any such merger or acquisition transactions~~Corporation.

~~Except as described above and as more particularly~~Business ~~described in our accompanying interim financial statements, there have been no other material changes in our financial condition from the end~~ of the preceding fiscal year to the date of the interim balance sheet provided herein, nor have there been any other material changes in the registrant’s financial condition during the period ending on the date of the interim balance sheet provided herein and commencing on the corresponding interim date of the preceding fiscal year. Except as described above and as more particularly described in our accompanying interim financial statements, there have been no material changes in our results of operations with respect to the most recent fiscal year-to-date period for which an income statement is provided and the corresponding year-to-date period of the preceding fiscal year.Issuer

~~Critical~~Since acquiring ~~Accounting~~the ~~Policies~~technology license described above, our management has expended significant time seeking sources of capital to implement our business plan, which is primarily designed to exploit the licensed technology throughout the United States and ~~Estimates~~Canada for commercial gain. In addition, we have acquired technology rights to an additional territory for the licensed technology. Management is also evaluating other alternatives in order to improve our financial condition, including merger and acquisition opportunities. There is no assurance that we will be successful in raising capital or closing any such merger or acquisition transactions.

~~The~~Except as ~~consolidated~~described above and as more particularly described in our accompanying interim financial statements, ofthere ~~our company~~have ~~are~~been ~~prepared~~no other material changes in ~~accordance~~our ~~with~~financial ~~accounting~~condition ~~principles~~from ~~generally~~the ~~accepted~~end inof the ~~United~~preceding ~~States~~fiscal ofyear ~~America.~~to ~~The~~the ~~amounts~~date of the interim balance sheet ~~assets,~~provided ~~liabilities~~herein, ~~revenues~~nor ~~and~~have ~~expenses~~there ~~reported~~been any other material changes in ~~our~~the registrant’s financial ~~statements~~condition ~~are~~during ~~affected~~the byperiod ending ~~accounting~~on ~~policies,~~the ~~estimates and~~date ~~assumptions~~of ~~that~~the ~~are~~interim ~~necessary~~balance tosheet ~~comply~~provided ~~with~~herein ~~generally~~and ~~accepted~~commencing ~~accounting~~on ~~principles~~the corresponding interim date of the preceding fiscal year. ~~Estimates~~Except ~~used~~as described above and as more particularly described in ~~the~~our accompanying interim financial statements, there ~~are~~have ~~derived~~been ~~from~~no ~~prior~~material ~~experience,~~changes ~~statistical~~in ~~analysis~~our ~~and~~results ~~professional~~of ~~judgments.~~operations ~~Actual~~with ~~results~~respect ~~may~~to ~~differ~~the ~~significantly~~most ~~from~~recent fiscal year-to-date period for which ~~these~~an ~~estimates~~income statement is provided and ~~assumptions~~the corresponding year-to-date period of the preceding fiscal year.

~~Management~~Page considers an estimate to be critical if it is material to the financial statements and it requires assumptions to be made that were uncertain at the time the estimate was made and changes in the estimate are reasonably likely to occur from period to period.15

~~Page~~Critical Accounting 14Policies and Estimates

~~Recently~~The consolidated ~~Issued~~financial ~~Accounting~~statements ~~Pronouncements~~of our company are prepared in accordance with accounting principles generally accepted in the United States of America. The amounts of assets, liabilities, revenues and expenses reported in our financial statements are affected by accounting policies, estimates and assumptions that are necessary to comply with generally accepted accounting principles. Estimates used in the financial statements are derived from prior experience, statistical analysis and professional judgments. Actual results may differ significantly from these estimates and assumptions.

~~See~~Management considers ~~Note~~an 1,estimate ~~Recently~~to ~~Issued~~be ~~Accounting~~critical ~~Pronouncements, of~~if it is material to the ~~Notes~~financial statements and it requires assumptions to be made that were uncertain at the ~~accompanying~~time ~~interim~~the ~~financial~~estimate ~~statements,~~was ~~included~~made and changes in ~~Item~~the 1estimate ofare ~~this~~reasonably ~~report,~~likely ~~for~~to ~~recently~~occur ~~issued~~from ~~accounting pronouncements~~period to period.

~~Plan~~Recently Issued ofAccounting ~~Operation~~Pronouncements.

~~Since~~See Note ~~acquiring~~1, ~~the~~Recently ~~technology~~Issued ~~license~~Accounting ~~described above~~Pronouncements, ~~our management has expended significant time seeking sources~~ of ~~capital to implement its business plan, which is primarily designed to exploit~~ the ~~licensed~~Notes ~~technology throughout the United States and Canada for commercial gain. In addition, we have acquired technology rights~~ to ~~an additional territory for~~ the ~~licensed~~accompanying ~~technology~~interim ~~through~~financial ~~Pavana Power Corporation~~statements, ~~a Nevada corporation,~~included ain ~~wholly-owned~~Item ~~subsidiary~~1 ~~that~~of ~~was~~this ~~organized on April 21~~report, ~~2011.~~for ~~There~~recently isissued noaccounting ~~assurance that the Registrant will be successful in raising capital or closing any such merger or acquisition transactions~~pronouncements.

~~Results~~ Plan of ~~Operations~~ Operation

~~Six~~Since acquiring ~~Months~~the ~~Ended~~technology ~~June~~license 30described above, ~~2017~~our management has expended significant time seeking sources of capital to implement its business plan, ~~compared~~which is primarily designed to exploit the licensed technology throughout the United States and Canada for commercial gain. In addition, we have acquired technology rights to an additional territory for the ~~Six~~licensed ~~Months~~technology ~~Ended~~through Pavana ~~June~~Power 30Corporation, ~~2016~~a Nevada corporation, a wholly-owned subsidiary that was organized on April 21, 2011. There is no assurance that the Registrant will be successful in raising capital or closing any such merger or acquisition transactions.

~~Assets~~Results of Operations

~~Licensed~~Three Months ~~technology~~Ended ~~assets~~March 31, ~~net~~2018, ofcompared ~~amortization, were~~to ~~unchanged~~the atThree ~~$200~~months ended March 31, 2017

~~Revenues~~Assets

~~We did not generate any operating revenues~~Licensed intechnology ~~the~~assets, ~~six~~net ~~months~~of ~~ended~~amortization, ~~June~~were ~~30,~~unchanged ~~2017.~~at $200

~~Costs and Expenses~~Revenues

~~Amortization~~We did ofnot ~~Acquired~~generate ~~Technology~~any operating revenues in the three months ended March 31, 2018.

~~There was no amortization of our technology~~Costs ~~assets~~and ~~during the six months ended June 30, 2017, as compared to $-0- during the comparable period in 2016.~~Expenses

~~General~~Amortization of ~~and~~Acquired ~~Administrative~~Technology

~~Operating~~There was ~~expenses~~no ~~increased~~amortization toof ~~$23,336~~our technology assets during the ~~six~~three months ended ~~June~~March 3031, ~~2017~~2018, as compared to $~~16,025~~-0- during the comparable period in ~~2016~~2017.

~~Liquidity~~ General and ~~Capital Resources~~Administrative

~~Cash~~Operating expenses ~~was~~increased to $17,~~689~~163 atduring ~~June~~the 30three months ended March 31, ~~2017~~2018, as compared to $119,~~059~~272 atduring ~~December~~the ~~31,~~comparable ~~2016~~period in 2017.

~~Total operating expenses were $23,336 during~~Liquidity ~~the~~and ~~six~~Capital ~~months ended June 30, 2017 compared to $16,025 at June 30, 2016.~~Resources

WeCash was ~~generated~~ $~~35,929~~644 ~~from~~at ~~financing~~March ~~activities during~~31, ~~the six months ended June 30~~2018, ~~2017~~ compared to $~~9,682~~644 ~~during~~at ~~the~~December ~~comparable period in 2016 due to additional funding by a shareholder. In the six months ended June 30~~31, 2017~~, management also closed a private placement for $20,000 (net of financing) as additional funding~~.

~~Our~~Page Company is a development stage company and have not generated any operating revenues as of June 30, 2017. In addition, we will continue to incur net losses and cash flow deficiencies from operating activities for the foreseeable future.16

~~Page~~Total operating 15expenses were $7,163 during the three months ended March 31, 2018 compared to $19,272 in 2017.

~~Based on its cash flow projections, we will~~Our ~~need~~Company ~~additional~~is ~~financing~~a todevelopment ~~carry~~stage ~~out~~company ~~its~~and ~~planned~~have ~~business~~not ~~activities~~generated ~~and~~any ~~complete~~operating ~~its~~revenues ~~plan~~as of ~~operations~~March ~~through December~~ 31, ~~2017~~ 2018. AtIn ~~our Company’s present level of activities~~addition, ~~our~~we ~~Company’s~~will continue ~~cash~~to isincur ~~considered~~net ~~insufficient~~losses and ~~this~~cash ~~draws~~flow ~~a substantial~~deficiencies ~~doubt~~from asoperating toactivities ~~our~~for ~~Company’s~~the ~~ability~~foreseeable ~~to continue as a going concern~~future.

~~Much~~Based on ofits ~~our~~cash ~~ability~~flow toprojections, ~~raise~~we ~~additional~~will ~~capital or~~need ~~secure~~additional afinancing ~~strategic~~to ~~collaboration~~carry ~~for~~out ~~the~~its ~~financing~~planned ofbusiness ~~our~~activities ~~continued operations~~ and ~~product~~complete ~~development will depend substantially~~its onplan ~~the successful outcome~~ of ~~our~~operations ~~efforts~~through toDecember ~~negotiate joint venture with wind power industry participants~~31, ~~the results of which will not be available until sometime later in the current fiscal year~~2018. WeAt ~~are~~our ~~also~~Company’s ~~currently~~present ~~seeking~~level toof ~~raise~~activities, ~~funds~~our ~~through~~Company’s ~~corporate~~cash is ~~collaboration~~considered ~~and~~insufficient ~~sub-licensing arrangements in connection with its ongoing~~ and ~~long-term~~this ~~operations.~~draws ~~Management~~a ~~does~~substantial ~~not~~doubt ~~know whether~~as ~~additional~~to ~~financing~~our ~~will~~Company’s beability ~~available~~to ~~when~~continue ~~needed~~as ~~or,~~a ifgoing ~~available, will be on acceptable or favorable terms to it or its stockholders~~concern.

~~Our~~Much of ~~Company’s~~our ~~independent~~ability ~~registered public~~to ~~accounting~~raise ~~firm~~additional ~~expressed~~capital ~~substantial~~or ~~doubt~~secure ~~about~~a strategic collaboration for the financing of our ~~Company’s~~continued ~~ability~~operations and product development will depend substantially on the successful outcome of our efforts to ~~continue~~negotiate asjoint aventure ~~going~~with ~~concern~~wind inpower industry participants, the ~~audit report~~results onof ~~our~~which ~~Company’s~~will ~~audited~~not ~~financial~~be ~~statements~~available ~~for~~until sometime later in the current fiscal year. ~~ended~~We ~~December~~are ~~31,~~also currently ~~2016~~seeking ~~included~~to raise funds through corporate collaboration and sub-licensing arrangements in ~~the~~connection ~~2016~~with ~~Form~~its ongoing 10and long-Kterm ~~and~~operations. inManagement ~~the~~does ~~footnotes~~not toknow ~~these~~whether ~~unaudited~~additional ~~interim~~financing ~~financial~~will ~~statements~~be ~~for~~available ~~the~~when ~~quarter~~needed ~~ended~~or, ~~June~~if 30available, will ~~2017~~be on acceptable or favorable terms to it or its stockholders.

~~Off~~Our Company’s independent registered public accounting firm expressed substantial doubt about our Company’s ability to continue as a going concern in the audit report on our Company’s audited financial statements for the fiscal year ended December 31, 2017 included in the 2017 Form 10-~~Balance~~K ~~Sheet~~and ~~Arrangements~~in the footnotes to these unaudited interim financial statements for the quarter ended March 31, 2018.

~~We do not have any off~~Off-~~balance sheet arrangements~~Balance ~~that~~Sheet have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.Arrangements

~~Item~~We do 3.not ~~Quantitative~~have ~~and~~any ~~Qualitative~~off-balance ~~Disclosures~~sheet ~~About~~arrangements ~~Market~~that ~~Risk~~have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

~~Not~~Item 3. ~~required~~Quantitative ~~under~~and ~~Regulation~~Qualitative ~~S-K~~Disclosures ~~for~~About ~~“smaller reporting~~Market ~~companies~~Risk.”

~~Item~~Not required 4.under ~~Controls~~Regulation ~~and~~S-K ~~Procedures~~for “smaller reporting companies.”

~~Disclosure~~Item 4. Controls and Procedures.

~~As of June 30, 2017, the Registrant carried~~Disclosure ~~out~~Controls ~~an evaluation of the effectiveness of the Registrant’s disclosure controls~~ and procedures (as defined by Rule 13a-15(e) under the Securities Exchange Act of 1934) under the supervision and with the participation of the Registrant’s chief executive and chief financial officer. Based on and as of the date of such evaluation, the aforementioned officer has concluded that the Registrant’s disclosure controls and procedures were not effective.Procedures

~~The~~As of March 31, 2018, the Registrant ~~also~~carried ~~maintains~~out aan ~~system~~evaluation of ~~internal accounting~~the ~~controls~~effectiveness ~~that~~of isthe ~~designed~~Registrant’s todisclosure ~~provide~~controls and ~~assurance~~procedures ~~that~~(as ~~assets~~defined ~~are~~by ~~safeguarded~~Rule ~~and~~13a-15(e) ~~that~~under ~~transactions~~the ~~are~~Securities ~~executed~~Exchange inAct ~~accordance with~~of ~~management’s~~1934) ~~authorization~~under the supervision and ~~properly~~with ~~recorded.~~the ~~This~~participation of ~~system~~the isRegistrant’s ~~continually~~chief ~~reviewed~~executive and ischief ~~augmented~~financial byofficer. ~~written~~Based ~~policies~~ on and ~~procedures,~~as of the ~~careful~~date ~~selection~~of ~~and~~such ~~training~~evaluation, ofthe ~~qualified~~aforementioned officer ~~personnel~~has ~~and~~concluded anthat ~~internal~~the ~~audit~~Registrant’s ~~program~~disclosure tocontrols ~~monitor~~and ~~its~~procedures ~~effectiveness~~were not effective.

~~Changes~~The Registrant Inalso ~~Internal~~maintains ~~Control~~a ~~Over~~system ~~Financial~~of internal accounting controls that is designed to provide assurance that assets are safeguarded ~~Reporting~~and that transactions are executed in accordance with management’s authorization and properly recorded. This system is continually reviewed and is augmented by written policies and procedures, the careful selection and training of qualified personnel and an internal audit program to monitor its effectiveness.

~~During the interim period ended June 30, 2017,~~Changes ~~there~~In ~~were~~Internal noControl ~~changes~~Over toFinancial ~~this system of internal controls or in other factors that could significantly affect those controls.~~Reporting

~~Page~~During the 16interim period ended March 31, 2018, there were no changes to this system of internal controls or in other factors that could significantly affect those controls.

~~PART~~Page ~~II—OTHER INFORMATION~~17

~~Item~~PART II—OTHER ~~1. Legal Proceedings~~INFORMATION

~~The Registrant is not a party to any pending~~Item or1. ~~threatened~~Legal ~~legal proceedings.~~Proceedings

~~Item~~The Registrant ~~1A.~~is ~~Risk~~not ~~Factors~~a party to any pending or threatened legal proceedings.

~~Not required under Regulation S-K for “smaller~~Item ~~reporting companies~~1A.” Risk Factors

~~Item~~Not required 2.under ~~Unregistered~~Regulation ~~Sales~~S-K offor ~~Equity~~“smaller ~~Securities~~reporting ~~and Use of Proceeds~~companies.”

~~In the six months ended June 30, 2017, management~~Item ~~also~~2. ~~closed~~Unregistered ~~for~~Sales ~~a private placement for $20,000 (net~~ of ~~financing~~Equity ~~expenses)~~Securities ~~for~~and ~~50,000~~Use ~~shares~~ of ~~common stock~~Proceeds.

~~Other than the above, the~~ The Registrant has not sold any unregistered equity securities during the period covered by this report.

Item 3. Defaults Upon Senior Securities. Not Applicable.

There were no defaults upon senior securities during the period ended ~~June~~March 3031, ~~2017~~2018.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

Exhibit No.		Document
2.1 (7)		Memorandum of Understanding between First National Energy Corporation and Serge Bolotov, dated February 3, 2016, accepted as binding February 5, 2016.
3.1(1)		Articles of Incorporation
3.2 (4)		Articles of Incorporation (Nevada)
3.2(1)		Bylaws
4.1(2)		2005 Stock Incentive Plan For Employees And Consultants (2)
4.2(8)		2016 Omnibus Equity Compensation Plan
10.1(3)		Letter of Intent with Boreas Research Corporation, dated April 17, 2009
10.2(4)		First Amendment Of Technology License And Stock Purchase Agreement with Boreas Research Corporation, dated May 14, 2009
10.3(5)		Novation Agreement with Boreas Research Corporation, dated April 18, 2011.
14.1 (6)		Financial Code of Ethics

Page 1718

31.1*		Sect. 302 Certification Statement of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Sect. 302 Certification Statement of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Sect.
32.1*		Sect. 906 Certification Statement of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002
32.2*		Sect. 906 Certification Statement of the Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002

~~101 INS~~	101 INS	~~XBRL Instance Document~~	XBRL Instance Document
~~101 SCH~~	101 SCH	~~XBRL Taxonomy Extension Schema Document~~	XBRL Taxonomy Extension Schema Document
~~101 CAL~~	101 CAL	~~XBRL Taxonomy Calculation Linkbase Document~~	XBRL Taxonomy Calculation Linkbase Document
~~101 DEF~~	101 DEF	~~XBRL Taxonomy Extension Definition Linkbase Document~~	XBRL Taxonomy Extension Definition Linkbase Document
~~101 LAB~~	101 LAB	~~XBRL Taxonomy Labels Linkbase Document~~	XBRL Taxonomy Labels Linkbase Document
~~101 PRE~~	101 PRE	~~XBRL Taxonomy Presentation Linkbase Document~~	XBRL Taxonomy Presentation Linkbase Document

	(1)	Incorporated by reference to the Company’s Form SB-2 filed on ~~June~~September 8, 2001.
	(2)	Incorporated by reference to the Company’s Form S-8, filed April 11, 2005.
	(3)	Incorporated by reference to the Company’s Form 8-K, filed April 21, 2009.
	(4)	Incorporated by reference to the Company’s Form 8-K, filed May 26, 2009.
	(5)	Incorporated by reference to the Company’s Form 8-K, filed April 20, 2011.
	(6)	Incorporated by reference to Exhibit 19 in the Company’s Form 10-K, filed March 16, 2012.
	(7)	Incorporated by reference to the Company’s Form 8-K, filed February 16, 2016.
	(8)	Incorporated by reference to the Company’s Form S-8, filed February 23, 2016.

* Filed herewith

Page 1819

SIGNATURES

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

	FIRST NATIONAL ENERGY CORPORATION
Dated: October 26, 2017	/s/ Gregory Sheller
Dated: July 09, 2018	/s/ Gregory Sheller
	Gregory Sheller, Chief Executive Officer

Page 1920

Filing Compare · First National Energy Corp.