Results of Operations for the Years Ended July 31, 2021 and 2020

Revenue

Revenues of oil and gas for the years ended July 31, 2021 and 2020 were $0 and $2,949, respectively, a decrease of $2,949. Revenues are earned primarily from the J.E. Richey Lease from the sale of oil and gas and are recorded net of any distributions paid. The decrease in revenue is due to lower production as well as lower oil and gas prices.




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Officer compensation Officer compensation was $26,400 and $6,600 for the years ended July 31, 2021 and 2020, respectively, an increase of $19,800. We began to incur monthly compensation expense for our new CFO in April 2020 and no compensation has been accrued or paid to the CEO in the current period.

Consulting - related party Consulting - related party services were $60,000 and $60,000 for the years ended July 31, 2021 and 2020. Fees are paid to Noel Schaefer, Director, but are billed as consulting fees.

Consulting expense Consulting fees were $8,000 and $12,700 for the years ended July 31, 2021 and 2020, respectively, a decrease of $4,700, or 37%. When needed the Company hires experts in the mining, oil and gas industries to assist with its current projects.

Professional fees Professional fees were $49,566 and $53,523 for the years ended July 31, 2021 and 2020, respectively, a decrease of $3,957, or 7%. Professional fees generally consist of legal, audit and accounting expense. The decrease can be attributed to a decrease in accounting fees that was offset with an increase in audit fees.

Mineral property expenditures Mineral property expenditures were $1,000 and $35,669 for the years ended July 31, 2021 and 2020, respectively, a decrease of $34,669, or 97%. Expenditures include lease payments for the working interest in the mineral properties and rework expense. The decrease in in the current period can be attributed to a decrease in expenditures while the Company pursues additional funding.

General and administrative General and administrative expense was $32,944 and $22,384 for the years ended July 31, 2021 and 2020, respectively, an increase of $10,560.

Other expense During the year ended July 31, 2021 we had total other expense of $65,058 compared to $152,910 in the prior year. During the current year we incurred interest expense of $93,017, which included a $72,631 expense for the issuance of warrnates on a loan conversion , a loss on the impairment of oil rights of $28,800 and a loss on debt conversion of $6,857, which was offset with a gain on forgiveness of debt of $38,616, and other income of $25,000. During the prior year we incurred interest expense of $14,795, which was offset with a gain on forgiveness of debt of $167,705.

Net Loss For the year ended July 31, 2021, we had a net loss of $242,968 as compared to a net loss of $35,017 for year ended July 31, 2020. Our net loss in the current year increased mainly due to the expense incurred for the issuance of warrants.

Liquidity and Financial Condition

Operating Activities Cash used by operating activities was $168,873 for the year ended July 31, 2021. Cash used for operating activities was $204,007 for the year ended July 31, 2020.



Investing Activities
We used $0 for investing activities for the year ended July 31, 2021 and 2020.

Financing Activities Net cash provided by financing activities was $163,000 foryear ended July 31, 2021 compared to $189,000for the year ended July 31, 2020. During the year ended July 31, 2021, we received $163,000 from the sale of common stock. During the year ended July 31, 2020, we received $100,000 from the sale of common stock and $89,000 from loan proceeds.

We had the following loans outstanding as of July 31, 2021: On October 20, 2017, the Company executed a convertible promissory note for $25,000 with a third party. The note accrues interest at 6%, matures in two years and is convertible into shares of common stock at maturity, at a minimum of $0.10 per share, at the option of the holder. As of July 31, 2021 and 2020, there is $5,769 and $4,257, respectively, of accrued interest due on this loan. This loan was converted to shares of common stock in September 2021.


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On April 16, 2017, the Company executed a promissory note for $15,000 with a third party. The note matures in two years and interest is set at $3,000 for the full two years. As of July 31, 2021, there is $15,000 and $4,875 of principal and accrued interest, respectively, due on this loan. As of July 30, 2020, there is $15,000 and $3,375 of principal and accrued interest, respectively, due on this loan. This loan is currently in default.

On June 11, 2020, a third party loaned the Company $14,000. On September 9, 2020, the Company repaid $5,000 on this loan. On March 3, 2021, the party loaned another $5,000 to the Company. The loan is unsecured, non-interest bearing and due on demand.

As of April 30, 2021, the Company owed $5,000 to a third party. The loan is unsecured, non-interest bearing and due on demand.

During the year ended July 31, 2020, a third party loaned the Company $15,000. The loan is unsecured, bears interest at 8% per annum and matures on September 1, 2021. As of July 31, 2021, there is $2,232 of interest accrued on this note. This loan was converted to shares of common stock in September 2021.

During the year ended July 31, 2020, a third party loaned the Company $60,000. The loan is unsecured, bears interest at 8% per annum and matures on September 1, 2021. As of July 31, 2021, there is $8,745 of interest accrued on this note.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that 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 is material to stockholders.

Critical Accounting Policies

Refer to Note 2 of our financial statements contained elsewhere in this Form 10-K/A for a summary of our critical accounting policies and recently adopting and issued accounting standards.

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