The accompanying notes are any integral part of these financial statements.

F-3

The accompanying notes are any integral part of these financial statements.

F-4

NOTE 1 – NATURE OF OPERATIONS AND CONTINUANCE OF BUSINESS

China Forest Energy Corp. (the “Company”) was incorporated in the State of Nevada on January 26, 2006. The Company is an Exploration Stage Company, as defined by Accounting Standards Codification (“ASC”) 915. The Company’s principal business is the acquisition and exploration of mineral properties.

On December 16, 2010, the Company filed articles of merger with its wholly-owned subsidiary to change the Company’s name to China Forest Energy Corp. and filed a certificate of change with the Nevada Secretary of State to give effect to a forward split of the Company’s authorized and issued and outstanding shares of common stock on a nine (9) new for one (1) old basis. Upon effect of the forward stock split, the authorized capital increased from 100,000,000 to 900,000,000 shares of common stock and, correspondingly, the issued and outstanding increased from 2,009,000 to 18,081,000 shares of common stock, with a par value of $0.00001. The Company’s preferred stock was unaffected as a result of the forward split. The Company’s financial statements have been retroactively restated to incorporate the effect of the forward split.

On January 12, 2011, the Company entered into share exchange agreement with Zhejiang Forest Bamboo Tec Co., Ltd. a People’s Republic of China corporation and Forest Energy Co., Ltd., a British Virgin Islands corporation. Forest Energy Co., Ltd. is the registered and beneficial owner of all of the issued and outstanding common shares in the capital of Sinoport Enterprises Limited, a British Virgin Islands corporation (“Sinoport”); Sinoport is the sole owner of all share capital of USCNHK Group Limited, a Hong Kong corporation, (“USCNHK”), and USCNHK is the owner of 95%, or 76,000,000 shares, of the share capital of Zhejiang Forest Bamboo Tec Co., Ltd. The Company has agreed to issue 15,919,000 common shares to the Forest Energy Co., Ltd.’s Shareholder as consideration for the purchase of 50,000 common shares of Zhejiang Forest Bamboo Tec Co., Ltd. Upon closing of the share exchange, Yongfu Zhu, one of the Company’s current officers and directors, will cancel 9,000,000 shares of the Company’s common stock held in his name and the Company will have no more than 25,000,000 shares of common stock issued and outstanding. As of March 16, 2011, this share exchange agreement has not been closed.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. The Company’s fiscal year-end is April 30.

Interim Financial Statements

The interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended April 30, 2010, included in the Company’s Annual Report on Form 10-K filed on July 29, 2010 with the SEC. The financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s financial position at January 31, 2011 and at April 30, 2010, and the results of its operations for the three and nine months ended January 31, 2011 and 2010 and cash flows for the nine months ended January 31, 2011 and 2010. The results of operations for the nine months ended January 31, 2011 are not necessarily indicative of the results to be expected for future quarters or the full year.

F-5

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company regularly evaluates estimates and assumptions related to donated expenses and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Earnings (Loss) Per Share

Basic earnings per share (“EPS”) is computed by dividing earnings (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. In periods where losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive.

Cash and Cash Equivalents

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.

Foreign Currency Translation

The Company’s functional and reporting currency is the United States dollar. Occasional transactions may occur in a foreign currency. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Average monthly rates are used to translate revenues and expenses. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.

F-6

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.

Subsequent Events

The Company has evaluated subsequent events through the filing date of this Form 10-Q and has determined that there were no subsequent events to recognize or disclose in these financial statements, except as disclosed in Note 1 in regards to the share exchange agreement.

Recent Accounting Pronouncements

The Company does not expect the adoption of any other recently issued accounting pronouncements to have a significant effect on its financial position or results of operations.

NOTE 3 – GOING CONCERN

These financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. Since inception, the Company has not generated revenues and has not paid any dividends and is unlikely to either pay dividends or generate revenues in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing, the Company’s success in acquiring interests in properties that have economically recoverable reserves, and the attainment of profitable operations. As at January 31, 2011, the Company has a working capital deficit, generated no revenues since inception, and has an accumulated deficit totaling $198,834. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

F-7

NOTE 4 – RELATED PARTY TRANSACTIONS

As of January 31, 2011 and April 30, 2010, the Company was indebted to a current director, and current CFO, Treasurer and Secretary of the Company in the amount of $21,000 and $14,000, respectively, representing cash advances and expenses paid on behalf of the Company. The balances consist of advances that are non-interest bearing, unsecured and due on demand.

During the three months ended January 31, 2011 and 2010, the Company recognized $750 and $750, respectively, for donated rent and $1,500 and $1,500, respectively, for donated services. During the nine months ended January 31, 2011 and 2010, the Company recognized $2,250 and $2,250, respectively, for donated rent and $4,500 and $4,500, respectively, for donated services. These amounts were charged to operations and recorded as additional paid-in capital.

NOTE 5 - NOTE PAYABLE

On December 20, 2010, the Company obtained a loan with a balance totaling $16,565 as of January 31, 2011 from an unrelated party. The loan is non-interest bearing, unsecured and due on demand.

F-8

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

This section of the report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.

     On December 16, 2010, we filed articles of merger with its wholly-owned subsidiary to change our name to China Forest Energy Corp. and filed a certificate of change with the Nevada Secretary of State to give effect to a forward split of our authorized and issued and outstanding shares of common stock on a nine (9) new for one (1) old basis. Upon effect of the forward stock split, the authorized capital increased from 100,000,000 to 900,000,000 shares of common stock and, correspondingly, the issued and outstanding increased from 2,009,000 to 18,081,000 shares of common stock, with a par value of $0.00001. Our preferred stock was unaffected as a result of the forward split. Our financial statements have been retroactively restated to incorporate the effect of the forward split.

     On January 12, 2011, we entered into share exchange agreement with Zhejiang Forest Bamboo Tec Co., Ltd. a People’s Republic of China corporation and Forest Energy Co., Ltd., a British Virgin Islands corporation. Forest Energy Co., Ltd. is the registered and beneficial owner of all of the issued and outstanding common shares in the capital of Sinoport Enterprises Limited, a British Virgin Islands corporation (“Sinoport”); Sinoport is the sole owner of all share capital of USCNHK Group Limited, a Hong Kong corporation, (“USCNHK”), and USCNHK is the owner of 95%, or 76,000,000 shares, of the share capital of Zhejiang Forest Bamboo Tec Co., Ltd. The Company has agreed to issue 15,919,000 common shares to the Forest Energy Co., Ltd.’s Shareholder as consideration for the purchase of 50,000 common shares of Zhejiang Forest Bamboo Tec Co., Ltd. Upon closing of the share exchange, Yongfu Zhu, one of our current officers and directors, will cancel 9,000,000 shares of our common stock held in his name and we will have no more than 25,000,000 shares of common stock issued and outstanding. As of March 16, 2011 this share exchange agreement has not been closed.

Limited Operating History

     There is limited historical financial information about us upon which to base an evaluation of our performance. We are an exploration-stage corporation and have not generated any revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the exploration of our properties, and possible cost overruns due to price and cost increases in services.

     To become profitable and competitive, we must find and acquire other mineral properties and conduct more comprehensive research and exploration of such properties before we start production of any minerals we may find. Our management has began looking at the possibility of merging with an operating Chinese company and has entered into the share exchange agreement noted above.

Results of Operations

     For the three-month and nine-month periods ended January 31, 2011 and 2010, the Company reported no revenue, respectively. For the quarter ended January 31, 2011, total expenses were $10,034, a $4,590, or 84%, increase from the $5,444 reported for the same period in 2010. Approximately $4,500 of this increase is attributable to an increase in transfer agent fees, legal fees and professional fees. For the nine months ended January 31, 2011, total expenses were $20,602, a $3,079, or 18%, increase from the $17,523 reported for the same period in 2010. The increase is attributable to an increase in legal and professional fees.

     Total expenses reported for the three and nine month periods ended January 31, 2011 and 2010 primarily represent expenses incurred for general administration, rent, travel, filing fees, professional services, and bank service charges. Shareholders of the Company have been making advances to the Company for the payment of operating expense; they have agreed to continue providing capital for ongoing operations, until such time the Company can generate revenues from commercial operations or increase capital through various financing arrangements.

Liquidity and Capital Resources

     As of January 31, 2011, we have $5,700 in cash available. If we acquire a property, find mineralized material, and it is economically feasible to remove the mineralized material, we will attempt to raise additional money through a subsequent private placement, public offering or through loans.

     As of the date of this report we have yet to generate any revenues.

     Since inception and up to January 31, 2011, we have issued 18,081,000 shares of our common stock and received $100,910.

     As of January 31, 2011 and April 30, 2010, we were indebted to our current director, and current CFO, Treasurer and Secretary in the amount of $21,000 and $14,000, respectively, representing cash advances and expenses paid on our behalf. The balances consist of advances that are non-interest bearing, unsecured and due on demand.

     On December 20, 2010, we obtained a loan with a balance totaling $16,565 as of January 31, 2011 from an unrelated party. The loan is non-interest bearing, unsecured and due on demand.

     As of January 31, 2011, our total current assets were $12,700 and our total current liabilities were $40,070 for a working capital deficit of $27,370.

     As at January 31, 2011, the Company has not generated revenues and has accumulated losses totaling $198,834 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Recent accounting pronouncements

     The Company does not expect the adoption of any other recently issued accounting pronouncements to have a significant effect on its financial position or results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS

     We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

     We carried out an evaluation, under the supervision and with the participation of our management, including our President/Principal Executive Officer/ Principal Financial Officer of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the ‘‘Exchange Act’’). Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

     Based upon our evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures are not effective as of January 31, 2011, due to the material weaknesses in the areas such as establishing an audit committee, lack of segregation of duties in preparation of financial statements, and lack of dual signatures of checks as described in Management's Report on Internal Control over Financial Reporting as reported in our Form 10-K for the year ended April 30, 2010.

Changes in Internal Control

There have been no changes in our internal control over financial reporting during the quarter ended January 31, 2011 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder, is an adverse party or has a material interest adverse to our interest

Item 1(a) Risk Factors

As a “small reporting company”, we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. [Removed and Reserved]

Item 5. Other Information

None.

Item 6. Exhibits

The following documents are included herein:

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities on this 17^th day of March, 2011.