UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2012

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____to ____

Commission File Number: 000-51712

PARK PLACE ENERGY CORP.
(Exact name of small business issuer as specified in its charter)

403-539-8710
Registrant’s telephone number, including area code

N/A
(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 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. Yes [ x ] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ x ] No [ ]

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

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date 20,667,726 shares of common stock as of May 10, 2012.

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

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

F-1

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

F-2

Supplementary cash flow information (Note 8)

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

F-3

The Company presently holds a 98,000 square kilometer exploration claim in the Dobroudja Basin located in northeast Bulgaria (the “Vranino Block”). The Company intends to conduct exploration activities over a 5 year period including seismic processing and the drilling of, at minimum, six test wells for a minimum cost of approximately US$5,000,000. On October 25, 2010, an appeal against the Bulgarian Council of Ministers decision to award the Vranino Block to the Company was filed with the Supreme Administrative Court of Bulgaria and is presently pending. The Company awaits the result of this appeal process prior commencing the exploration program.

F-4

As at March 31, 2012, the following share purchase warrants were outstanding:

F-5

F-6

This quarterly report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology including "could", "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential" and the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this report.

Overview of our Business

Name and Organization

We were incorporated under the laws of the State of Nevada on August 27, 2004 under the name ST Online Corp. On June 22, 2007, we entered into a business combination agreement with Park Place Energy Inc., a private company incorporated under the laws of the Province of Alberta, Canada, and 0794403 B.C. Ltd., a wholly-owned subsidiary of our company incorporated under the laws of British Columbia. Pursuant to this business combination agreement, Park Place Energy Inc. and 0794403 B.C. Ltd. amalgamated under the provisions of the British Columbia Business Corporations Act and continued as Park Place Energy Inc., a company governed by the British Columbia Business Corporations Act.

On July 6, 2007, we completed a forward split of our shares of common stock on the basis of eight new shares of common stock for each one share of common stock outstanding on that date and increased the authorized share capital from 100,000,000 shares of common stock to 800,000,000 shares of common stock. At the same time, we merged with our wholly-owned subsidiary, Park Place Energy Corp. which we incorporated under the laws of the State of Nevada in contemplation of the acquisition of all of the issued and outstanding shares of Park Place Energy Inc. and our name was then changed to Park Place Energy Corp.

On July 23, 2007, we completed a forward split of our shares of common stock on the basis of one and one-half new shares of common stock for each one share of common stock outstanding on that date and increased the authorized share capital from 800,000,000 shares of common stock to 1,200,000,000 shares of common stock.

On July 30, 2007, pursuant to the terms of a business combination agreement, we issued to each shareholder of record of Park Place Energy Inc. one share of our common stock for every two shares they held of Park Place Energy Inc. As a result, we issued 8,995,662 shares of common stock (299,855 shares on a post March 24, 2010 reverse split basis) shares of common stock to the former shareholders of Park Place Energy Inc. Additionally, as part of this transaction, a total of 45,000,000 shares of our common stock (1,500,000 shares on a post March 24, 2010 reverse split basis) held by former principals of our company were surrendered for cancellation. We thereby acquired Park Place Energy Inc. For accounting purposes, the acquisition was treated as a recapitalization with Park Place Energy Inc. being the accounting acquirer and the go-forward financial statements reflect the history of Park Place Energy Inc. from its inception on May 4, 2006. As a result of the acquisition, the business of our company is now the acquisition and exploration of oil and gas properties.

On August 31, 2009, we completed a forward split of our shares of common stock on the basis of ten new shares of common stock for each one share of common stock outstanding on that date and increased the authorized share capital from 1,200,000,000 shares of common stock to 12,000,000,000 shares of common stock.

On March 24, 2010, we completed a reverse split of our shares of common stock on the basis of one new share of common stock for each three hundred shares of common stock outstanding on that date and decreased our authorized share capital from 12,000,000,000 shares of common stock to 40,000,000 shares of common stock.

General

Park Place Energy Corp. is an exploration stage company engaged in exploring for oil and natural gas. Throughout this Quarterly Report on Form 10-Q, the terms "Park Place" "we" "us," "the Company", "our" and "our company" refer to Park Place Energy Corp. and its subsidiaries.

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Today, the operations of our company and its subsidiaries concentrate on CBM and tight gas exploration and development in the Dobrich region in north eastern Bulgaria. Our goal is to become a recognized producer of gas in Bulgaria and in CBM property acquisition, exploration, development and production in Europe. Our principal business offices are located at Suite 300, 4-5th Avenue SW, Calgary, AB, Canada, T2P 0L6 and our telephone number is (403) 537-8710.

We currently have interests in oil and gas properties in the Canadian province of Saskatchewan and in Eastern Bulgaria. See “Properties” for more information about our interests. On October 12, 2010 the Bulgarian Council of Ministers granted to the Company a permit for the exploration and prospecting of oil and natural gas in the Dobroudja Basin. The Permit is for a five year period. On October 25, 2010 an appeal against the Bulgarian Council of Ministers decision was filed with the Supreme Administrative Court of Bulgaria by a competitive bidder.

Park Place believes that good environmental, social, health and safety performance is an integral part of our business success. Our commitment to these principles is demonstrated by the fact that we have had no lost-time accidents in over six years and no major environmental incidents. We conduct our business with respect and care for our employees, contractors, communities, and the environments in which we operate. Our vision is zero harm to people and the environment while creating value for our shareholders as well as for Bulgaria, including the regions and communities within which we operate. We have a commitment to be a good corporate citizen of the countries in which our properties are located, striving to emphasize and utilize very high levels of local personnel, services, and equipment.

Our Website

Our website can be found at www.parkplaceenergy.com. Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed with or furnished to the U.S. Securities and Exchange Commission ("SEC"), pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 ("Exchange Act"), can be accessed free of charge by linking directly from our website under the "Investor Relations - SEC Filings" caption to the SEC's Edgar Database.

Vranino 1-11 exploration block, Bulgaria

In 2010, we revamped our business strategy to focus on obtaining European exploration properties for both conventional and unconventional gas (shale, tight gas and coal bed methane). We retained consultants with specialized technical expertise in unconventional gas exploration to assist us in locating, assessing and planning suitable exploration and development of potential opportunities. In October of 2010, we were awarded an exploration permit for the “Vranino 1-11 block” located in Dobroudja Basin by the Bulgarian Counsel of Ministers, with terms and conditions of the permit as follows:

• Five year term exploration program;

• Perforate and re-test the Vranino #1 well previously drilled;

• Initiate a comprehensive 2-D and 3-D seismic program over the license area,

• Drill and complete a 5 additional test wells in the eastern up-thrown block within the license area

Our minimum work commitment as required by the permit broken down by year is as follows:

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To formulate our work program, we consulted with the previous operator, local geologists and others. The costs of the exploration plan may vary depending on a variety of factors, including, inter alia, the market price and availability of technical services in the local area, taxes, and transportation costs relating to delivering equipment to the exploration area.

Subsequent to the award of this claim, we have engaged in an assessment of drilling services companies in the local area suitable to engage to provide drilling services in the region. We have located several suitable service providers for drilling and other services which we intend to engage at the appropriate time. Local companies in Bulgaria will be used to provide services to the best extent possible. However, as the Bulgarian energy sector is relatively undeveloped, the availability of local drilling services specialized to unconventional gas exploration is limited. Park Place has determined that such expertise, services or equipment is available in Romania, Turkey and other surrounding regions. We have located suitable drilling services companies in Romania and Turkey that we may hire to perform the more difficult drilling involving unconventional gas hydrocarbon structures.

Our exploration of the Vranino 1-11 block has not yet commenced due to the fact the a competing bidder has disputed the award of the claim to Park Place. The Company is currently awaits a decision from the court following the March 2012 hearing.

Plan of Operations

Overview

Our Plan of Operations is to focus exploring and developing the Vranino 1-11 exploration claim in Bulgaria and acquiring interests in other exploration claims in Bulgaria or similar regions.

Management is in the process of expanding its Board of Directors and management team to accommodate the planned increase in operations and exploration activity.

Park Place will continue to pursue a positive conclusion to the current litigation relating to the Vranino 1-11 claim through any means available. We have obtained legal representation in Bulgaria to represent us in this matter. Our plan of Operations is highly contingent upon the results and timing of the litigation surrounding the Vranino permit.

Park Place plans intends to raise additional capital within the next twelve months to pay for the balance of the work program relating to Vranino 1-11 in Bulgaria. The work program is expected to conclude no later than in 2017. Subject to the positive conclusion of the appeal before the Supreme Administrative Court of Bulgaria, management will undertake subsequent financings as required.

Management intends to conduct additional 2-D and 3-D seismic processing, the reprocessing of historical seismic data, and the purchase of additional seismic data held by third parties. Park Place plans to perforate and test the existing Vranino #1 well over the next twelve months. Park Place estimates that the first year seismic program will cost $375,000.

We anticipate spending approximately $250,000 over the next 12 months in office and general expenses.

While the Company awaits the outcome of legal in Bulgaria relating to the Vranino 1-11 claim, Park Place is seeking further exploration opportunities either through direct acquisition or joint venture agreements.

Working Capital

Based on our current plan of operations as set forth above, we estimate that we will require approximately $625,000 to pursue our plan of operations over the next 12 months. As at March 31, 2012, we had cash of $318,768 and working capital of $247,833.

We anticipate that additional funding will be in the form of equity financing from the sale of our common stock will be required to complete our plan of operations. If we do not continue to obtain additional financing going forward, we will reevaluate our plans.

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Results of Operations

The following summary of our results of operations should be read in conjunction with our financial statements for the quarter ended March 31, 2012 which are included herein.

Revenue

We had oil and gas revenue of $3,391 for the three months ended March 31, 2012, compared to $nil for the three months ended March 31, 2011.

Since inception, we have earned oil and gas revenues of $1,652,573 relating to our successful exploration efforts and incurred depletion costs of $1,256,066 and production costs of $1,166,893. We have written off expenditures of $4,304,265 relating to exploration efforts that did not yield productive results.

Expenses

Our total operating expenses for the three months ending March 31, 2012 total $70,442 compared to $15,992 for the same period in 2011.

Our primary expense categories are described below:

Office and General Expenses

Our office and general expenses increased to $16,878 for the three months ended March 31, 2012 from $8,534 for the three months ended March 31, 2011.

Professional Fees

Our professional fees increased to $33,791 for the three months ended March 31, 2012 from ($544) for the three months ended March 31, 2011.

Management and Consulting

Our management and consulting fees increased to $22,670 for the three months ended March 31, 2012 from $6,571 for the three months ended March 31, 2011.

Investor Relations Expenses

Our investor relations expense for the three months ended March 31, 2012 increased to $375 compared to $102 for the three months ended March 31, 2011.

Loss

Our net loss before other items for the three months ended March 31, 2012 was $70,362, compared to $15,992 for the three months ended March 31, 2011.

Liquidity and Capital Resources

Overview

From May 4, 2006 (date of inception) to March 31, 2012, we raised net proceeds of $9,079,905 in cash from the issuance of common stock and share subscriptions received, $770,550 from loans payable for a total of $9,850,455 of cash provided by financing activities for the period.

We used net cash of $23,898 in operating activities for the three months ended March 31, 2012 compared to $78,655 for the same period in 2011. We used net cash of $5,004,740 in operating activities for the period from May 4, 2006 (date of inception) to March 31, 2012.

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The following table summarizes our liquidity position as of March 31, 2012:

We anticipate that we will require approximately $625,000 to pursue our plan of operations over the next 12 months. As at March 31, 2012, we had cash of $318,768 and working capital of $247,833. We require additional financing to pursue our plan of operations over the next 12 months, with amounts primarily depending upon the outcome of the pending court case, and the actual costs of our first year exploration program in Bulgaria on Vranino 1-11. If we lose the Vranino 1-11 claim in Bulgaria then our anticipated expenditures will be significantly reduced. We anticipate raising additional funds over the next twelve months to pay for our exploration commitments in Bulgaria.

Cash Flow from Investing Activities

Net cash used in investing activities in the three months ended March 31, 2012 was $95,840 compared to $nil used in investing activities in the three months ended March 31, 2011.

Cash Provided By Financing Activities

For the three months ended March 31, 2012, received cash of $nil compared to $81,500 for the three months ended March 31, 2011.

Off-Balance Sheet Arrangements

There are 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, which individually or in the aggregate is material to our investors.

Not applicable because we are a smaller reporting company.

Disclosure of Controls and Procedures

We carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of March 31, 2012 (the “Evaluation Date”). This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of the Evaluation Date as a result of the material weaknesses disclosed in our Annual Report on Form 10-K for the year ended December 31, 2011 (the “2011 Annual Report”).

Notwithstanding the assessment that our internal control over financial reporting was not effective and that there were material weaknesses as identified in our 2011 Annual Report, we believe that our financial statements contained in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 fairly present our financial condition, results of operations and cash flows in all material respects.

No Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

We currently are party to legal proceedings in Bulgaria where a competitive bidder, Overgas, seeks to overturn the Bulgarian Counsel of Minister’s award of the Vranino 1-11 exploration claim to us. The Ministry of Energy, Environment and Tourism continues to support the granting of the award to Park Place. The Company is currently waiting for the court’s decision following our final court hearing March 2012.

Not applicable because we are a smaller reporting company.

None,

None.

Not applicable.

None

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.

PARK PLACE ENERGY CORP.