DOUBLE CROWN RESOURCES INC. - FORM 10-Q

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EXCEL - IDEA: XBRL DOCUMENT - DOUBLE CROWN RESOURCES INC.	Financial_Report.xls
EX-32.1 - CERTIFICATION - DOUBLE CROWN RESOURCES INC.	ddcc_ex321.htm
EX-31.2 - CERTIFICATION - DOUBLE CROWN RESOURCES INC.	ddcc_ex312.htm
EX-31.1 - CERTIFICATION - DOUBLE CROWN RESOURCES INC.	ddcc_ex311.htm

U.S. 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 September 30, 2012

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

For the transition period from ______ to _______

Commission File No. 000-53389

Double Crown Resources, Inc.

(Name of small business issuer in its charter)

Nevada		98-0491567
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2312 N. Green Valley Pkwy., Suite 1026, Henderson, Nevada 89014

(Address of principal executive offices)

(707) 961-6016

(Issuer’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:		Name of each exchange on which registered:
None

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

Common Stock, $0.001
(Title of Class)

Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 o

Indicate by checkmark 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 (Section 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. Yes x No o

Indicate by checkmark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Applicable Only to Issuer Involved in Bankruptcy Proceedings During the Preceding Five Years.

N/A

Indicate by checkmark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act of 1934 after the distribution of securities under a plan confirmed by a court. Yes o No o

Applicable Only to Corporate Registrants

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

Class		Outstanding as of November 5, 2012
Common Stock, $0.001		177,751,145

DOUBLE CROWN RESOURCES, INC.

Form 10-Q

Part 1.	FINANCIAL INFORMATION	Page

Item 1.	Financial Statements		3

	Balance Sheets (Unaudited)		4

	Statements of Operations (Unaudited)		5

	Statements of Cash Flows (Unaudited)		6

	Notes to Financial Statements (Unaudited)		7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		12

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		25

Item 4.	Controls and Procedures		25

Item 5.	Other Information.		25

Part II.	OTHER INFORMATION

Item 1.	Legal Proceedings		23

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		23

Item 3.	Defaults Upon Senior Securities		25

Item 4	Mine Safety Disclosure		25

Item 5.	Other Information		25

Item 6	Exhibits		29

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

DOUBLE CROWN RESOURCES, INC

(Formerly “Denarii Resources, Inc.”)

(An Exploration Stage Company)

FINANCIAL STATEMENTS

SEPTEMBER 30, 2012

DOUBLE CROWN RESOURCES, INC.

(Formerly "Denarii Resources, Inc.")

(An Exploration Stage Company)

BALANCE SHEETS

	September 30,			December 31,
	2012			2011
	(Unaudited)

Assets:
Cash	$	2,902		$	38,120
Total Current Assets		2,902			38,120

Total Assets	$	2,902		$	38,120

Liabilities:
Current Liabilities
Accounts Payable and Accrued Expenses	$	61,777		$	50,208
Accounts Payable -Disputed		77,998			83,998
Disputed Liability - Related Party (Note 7)		563,206			563,206
Accrued Interest - Related Party (Note 7)		84,737			20,881
Note Payable- Related Party (Note 7)		132,382			132,382
Debt - Related Parties (Note 5)		151,323			143,572
Convertible Debt - Non Related Party (Note 4 & 6)		-			20,000
Total Current Liabilities		1,071,423			1,014,247

Non-Current Liabilities:
Mineral Prospect Obligation (Note 4)		145,361			135,378
Debt - Long Term (Note 4)		30,000			30,000
Total Non-Current Liabilities		175,361			165,378

Total Liabilities		1,246,784			1,179,625

Stockholders' Equity (Deficit):
Common Stock par value $0.001 authorized 500,000,000
shares, Issued 177,751,145 and 148,549,999 shares,
respectively		177,751			148,550
Stock Subscription Payable		11,570			1,000
Stock Subscription Receivable		(9,413	)		(24,000	)
Additional Paid in Capital		2,073,878			1,182,182
Deficit Accumulated During Exploration Stage		(3,497,668	)		(2,449,237	)
Total Stockholders' Deficit		(1,243,882	)		(1,141,505	)

Total Liabilities and Stockholders' Deficit	$	2,902		$	38,120

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

DOUBLE CROWN RESOURCES, INC.
(Formerly "Denarii Resources, Inc.")
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS
(unaudited)

													From
													Inception
													(March 23,
	Three Months Ended						Nine Months Ended						2006) through
	September 30,			September 30,			September 30,			September 30,			September 30,
	2012			2011			2012			2011			2012

Revenues	$	-		$	-		$	-		$	-		$	-
Costs of Services		-			-			-			-			-

Gross Margin		-			-			-			-			-

Operating Expenses:
Impairment of Mineral Property-
Acquisition Costs		-			-			-			60,250			70,250
Impairment of Prepaid Royalties		-			-			-			124,200			124,795
Professional Fees		22,217			47,525			775,634			262,261			1,837,176
General & Administrative		15,286			312,245			70,936			481,151			898,961
Total Operating Expenses		37,503			359,770			846,570			887,748			2,931,182

Operating (Loss)		(37,503	)		(359,770	)		(846,570	)		(887,748	)		(2,931,182	)

Other (Income) Expense:
Interest Expense		27,520			7,817			81,827			15,514			119,862

Civil Claim Contingency		-			-			-			-			286,875
Financing Cost - Related Party		-			-			120,034			-			159,749
Total Other Expenses		27,520			7,817			201,861			15,514			566,486

Net Loss Before Income Taxes		(65,023	)		(367,587	)		(1,048,431	)		(903,262	)		(3,497,668	)

Income Tax		-			-			-			-			-

Net Loss	$	(65,023	)	$	(367,587	)	$	(1,048,431	)	$	(903,262	)	$	(3,497,668	)

Loss per Share, Basic &
Diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)

Weighted Average Shares
Outstanding		174,369,485			86,141,847			169,292,294			75.730.585

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

DOUBLE CROWN RESOURCES, INC.
(Formerly "Denarii Resources, Inc.")
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)

							From
							Inception
							(March 23,
	Nine Months Ended						2006) to
	September 30,			September 30,			September 30,
	2012			2011			2012
CASH FLOW FROM OPERATING ACTIVITES:
Net Loss for the Period	$	(1,048,431	)	$	(903,262	)	$	(3,497,668	)
Adjustments to reconcile net loss to net cash used by operating activities:
Shares Issued		737,857			392,833			1,687,824
Impairment of Mineral Property Acquisition Costs		-			60,250			60,250
Impairment of Prepaid Royalties		-			124,200			134,200
Beneficial Conversion Feature		-			-			39,715
Litigation		-			-			322,093
Financing Cost of Warrants Issued		120,034			-			120,034
Changes in Operating Assets and Liabilities:
Increase (Decrease) in Accounts Payable		11,569			79,544			61,777
Increase (Decrease) in A/P to Related Party		(6,000	)		153,396			641,204
Increase in Accrued Interest to a Related Party		43,856			8,062			84,737
Increase in Accreted Interest on royalty obligation		17,734			7,452			21,105
Decrease (Increase) in Prepaids		-			(832	)		-
Net Cash (Used) in Operating Activities		(123,381	)		(78,357	)		(324,729	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of Mineral Claim		-			-			(10,000	)
Net Cash Used by Investing Activities		-			-			(10,000	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Convertible Debt		-			-			97,104
Proceeds from Subscription Payable		10,843			45,000			55,843
Proceeds from Issuance of Common Stock		67,320			55,000			245,120
Proceeds from Subscription Receivable		10,000			-			10,000
Net Cash Provided by Financing Activities		88,163			100,000			408,067

Net (Decrease) Increase in Cash		(35,218	)		21,643			38,120
Cash at Beginning of Period		38,120			-			-
Cash at End of Period	$	2,902		$	21,643		$	2,902

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest	$	-		$	-		$	-
Franchise and Income Taxes	$	-		$	-		$	-

NON-CASH INVESTING AND FINANCING ACTIVITIES:
Accounts Payable for Mineral Property	$	-		$	-		$	5,000
Convertible Debt Issued for Mineral Property	$	-		$	-		$	50,000
Expenses Paid by Related Parties	$	-		$	186,929		$	357,956
Proceeds from Private Placement (Paid to Related Parties)	$	-		$	40,000		$	40,000
Shares Payable for Mineral Property	$	-		$	-		$	5,250

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

DOUBLE CROWN RESOURCES, INC.

(Formerly “Denarii Resources, Inc.”)

(An Exploration Stage Company)

Notes to Financial Statements

September 30, 2012

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

Double Crown Resources, Inc. (Formerly “Denarii Resources, Inc.”) ("Double Crown Resources" or the "Company") was organized under the laws of the State of Nevada on March 23, 2006 to explore mining claims and property in North America.

The preparation of the financial statements in conformity with generally accepted accounting principles in the United States of America 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. These are condensed notes and should be read in conjunction with the audited financial statements from the year ending December 31, 2011.

Basis of Presentation

These financial statements are presented in United States dollars and have been prepared in accordance with United States generally accepted accounting principles.

NOTE 2 - GOING CONCERN

The Company’s financial statements as of September 30, 2012 have been prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The Company has incurred a cumulative net loss from inception (March 23, 2006) through March 31, 2012 of $3,497,668.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and cash equivalents

The Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

Net Loss per Share

Net loss per common share is computed by dividing net loss by the weighted average common shares outstanding during the period as defined by Financial Accounting Standards, ASC Topic 260, "Earnings per Share". Basic earnings per common share (“EPS”) calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from those estimates. Management believes that the estimates used are reasonable.

In Management's opinion all adjustments necessary for a fair statement of the results for the interim periods have been made. All adjustments are normal and recurring other than the impairment of the Software development intangible as described in Note 5 of these footnotes.

Revenue Recognition

The Company recognizes revenue on an accrual basis. Revenue is generally realized or realizable and earned when all of the following criteria are met: 1) persuasive evidence of an arrangement exists between the Company and our customer(s); 2) services have been rendered; 3) our price to our customer is fixed or determinable; and 4) collectability is reasonably assured.

Fair value of financial instruments

The carrying value of cash equivalents and accrued expenses approximates fair value due to the short period of time to maturity.

Stock-based compensation

The Company recognizes stock-based compensation in accordance with ASC Topic 718 “Stock Compensation”, which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors including employee stock options and employee stock purchases related to an Employee Stock Purchase Plan based on the estimated fair values.

Recent Accounting Pronouncements

The Company has evaluated all of the recent accounting pronouncements through the filing date of these financial statements and feels that none of them will have a material effect on the Company’s interim financial statements.

NOTE 4 – DEBT

Mineral Prospect Obligation

Effective on February 9, 2011 the company entered into an agreement between the Company and Richard and Gloria Kwiatkowski (“the Seller”). The Option provides for the development of 136 claim units covering a series of nickel-colbalt-gold-platinum group element prospects, which prospects are located 35 kilometers northwest of Thunder Bay, Ontario (the “Prospects”).

In accordance with the terms and provisions of the Option: (i) upon execution of certain documentation and transfer of title, the Company has paid $5,000 and has issued 250,000 shares of common stock to the Kwiatkowskis; (ii) at the end of year one, February 9, 2012, the Company issued Kwiatkowskis 512,821 shares as payment which was valued at $20,000 (fair market value $0.039/share). (iii) At the end of year two, February 9, 2013, the Company will pay to Kwiatkowskis a further $30,000 either in half cash and half shares or all shares at the option of the Kwiatkowskis; (iv) each anniversary thereafter, the Company shall pay to Kwiatkowskis $25,000 as advance royalty payment until the sum of $200,000 has been paid; (v) the Company shall further make payment to Kwiatkowskis of 3% NSR royalty on all production from the Prospects, which royalty may be purchased by the Company as to 1.5% of the 3% for the sum of $1,500,000 in increments of $500,000 per 0.5% NSR; and (vi) the Company shall commit to expenditures of $200,000 on the Prospects.

As part of this agreement, the Company issued a convertible debt of $20,000 to the Seller. In conjunction with this debt, there was no debt discount or beneficial conversion feature recorded since the conversion privilege was contingent on the current market value of the shares at the date of the notice of conversion. Accordingly, on February 9, 2012 the Company issued to Gloria and Richard Kwiatkowski 256,411 and 256,410 shares respectively at the market price of $0.0390 to satisfy the $20,000 Debt.

The prepaid royalty of $124,200 has been analyzed for impairment and has been fully impaired.

This liability is presented at the present value of expected future cash flow requirements.

Interest on the discounted royalty claim has been accreted at 12%. Accreted interest was $21,161 and $11,178 as of September 30, 2012 and December 31, 2011 which bring the liability balances to $145,361 and $135,378.

NOTE 5 – RELATED PARTY TRANSACTIONS

Debt – Related Party

In the year ended December 31, 2010 the company entered into a five-year consulting agreement dated October 1, 2010 with Dr. Stewart Jackson (“Jackson”), pursuant to which Jackson, as the chief executive officer and a member of the Board of Directors, will provide certain consulting services to the Company including, but not limited to, contact with precious metal assets for acquisition in North America. After the change in management, the Company recognized the future remaining obligation based on the contract to Mr. Jackson and accrued it at its present value using a 12% discount rate over fifty-one months. This resulted in an $89,596 being recorded as a related party debt.

In addition to the $89,596, another $5,976 was accrued as of December 31, 2011 and interest expense of $7,751 has been recorded for the nine months ended September 30, 2012, for a total convertible debt of $103,323 at September 30, 2012. The Company is disputing this liability.

Loans from Shareholder

An officer of the Company has made loans to the Company totally $48,000 as of September 30, 2012. The loans are non-interest bearing and payable on demand.

NOTE 6 – STOCKHOLDERS' DEFICIT

Authorized

500,000,000 common shares with a par value of $0.001.

Shares Issued

On January 9, 2012 the company issued 5,000,000 shares to independent contractors for services rendered in the amount of $85,000. These shares were issued at the share price of $0.017.

On January 31, 2012, the Company issued 1,000,000 shares for cash. The cost per share was $0.005. These shares were previously recorded as Common stock payables.

On February 9, 2012, the company issued 512,821 shares in accordance with the terms of the Mineral Prospect Obligation (see Note 4) for the conversion of a $20,000 Debt. The cost per share is $0.039.

On February 9, 2012, the Company issued 1,000,000 shares in a private placement for cash valued at $10,000. These shares were valued at $0.01 per share.

On February 9, 2012, the Company issued 1,110,000 shares in a private placement for cash valued at $22,200. These shares were valued at $0.02 per share.

On February 9, 2012, the Company issued 3,600,000 shares in a private placement for cash valued at $18,000. These shares were valued at $0.005 per share.

On February 9, 2012, the company issued 1,000,000 shares pursuant to a consulting agreement with Glenn Soler, a related party for consulting services. The cost per share is $0.039. Of this issuance, $6,000 was in satisfaction of payables owed to Mr. Soler as of March 31, 2012; accordingly, the remaining $33,000 in value was recorded as a related party consulting expense.

On February 9, 2012 the company issued 6,500,000 shares to independent contractors for services contracts in the amount of $253,500. These shares were issued at the share price of $0.039.

On April 5, 2012 the Company issued 3,000,000 shares to independent contractors for services contracts in the amount of $45,000. The market price per share at issuance was $0.015.

On April 5, 2012 the Company issued 199,995 shares for $1,500 cash. The share price paid was $0.0075 per share.

On April 27, 2012 the Company issued 133,330 shares for $1,000 cash which resulted in a share price paid of $0.0075. On the same day, the Company issued another 150,000 shares for $3,000 cash which resulted in a share price paid of $0.02.

On April 27, 2012 the Company erroneously issued Mr. Norman Palmer 133,330 shares which we later canceled and returned to the treasury in the following quarter due to lack of consideration.

On April 27, 2012 the Company issued 5,100,000 shares which were previously issuable and authorized on February 9, 2012.

During the quarter ended September 30, 2012 1,995,000 shares were issued for cash of $2,850 with $9,413 still owed, and 2,000,000 shares were issued for services valued at market for $10,000.

Subscriptions Payable

At September 30, 2012, $11,570 has been received in advance of shares issued.

Stock Warrants

The following is a summary of warrants balance as of June 30, 2012:

	Number of Shares			Weighted Average Exercise Price		Expiration Date
Balance, December 31, 2011		1,966,666			0.04	June 30, 2012

Warrants granted and assumed		10,000,000			0.005	January 9, 2012
Warrants expired		(8,000,000	)		0.005	January 31, 2012
Warrants canceled		(1,966,666)			0.005	June 30, 2012
Warrants exercised		(2,000,000	)		0.005	Exercised by the expiration date of January 31, 2012

Balance, September 30, 2012		-

NOTE 7 – DISPUTED LIABILITIES

As of June 15, 2011 the old management signed a resolution approving the issuance of convertible promissory notes in the amount of $271,331 to Falco Investments Inc. New management believes that the old management was not acting in the best interest of the company when they authorized these expenses and subsequently approved the issuance of the convertible debts. The Company has recorded the balance of $759,457 due to Falco Investments Inc. of which $132,382 has been reported as convertible debt, $563,206 as a Disputed Liability Related Party and $84,737 as accrued interest to September 30, 2012. The Company has decided to contest the current balance claimed to be due to Falco. It is current management’s opinion that these amounts due are frivolous. Falco Investments initiated a lawsuit in November of 2011.

NOTE 8 – SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the filing date of these financial statements and has disclosed that there are not such events that are material to the financial statements.

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

FORWARD LOOKING STATEMENTS.

The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These forward-looking statements involve risks and uncertainties, including statements regarding Double Crown Resources, Inc.'s (the "Company") capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "expect", "plan”,” intend", "anticipate", "believe", "estimate", "predict", "potential" or "continue", the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined below, and, from time to time, in other reports the Company files with the SEC. These factors may cause the Company's actual results to differ materially from any forward-looking statement. The Company disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

As used in this Quarterly Report, the terms "we," "us," "our," and "our Company" mean Double Crown Resources, Inc. unless otherwise indicated. All dollar amounts in this Quarterly Report are in U.S. dollars unless otherwise stated.

OVERVIEW

Double Crown Resources, Inc. was organized under the laws of the State of Nevada on March 23, 2006, to explore mining claims and property in North America.

We are an exploration stage company and we have not realized any revenues to date. We do not have sufficient capital to enable us to commence and complete our exploration program. We will require financing in order to conduct the exploration programs.

CURRENT BUSINESS OPERATIONS

We have been developing new business ventures to supply vital minerals needed for oilfield drilling operations. Additionally, at this time we have been approved and registered to purchase and resell refined petroleum products from a major international producer of transportation fuels and other petrochemical products based in Texas. The steps required to obtain the approval from the international producer of transportation fuels were as follows: (i) complete credit application and submit together with supporting documentation (collectively, the "Application"); (ii) Application is provided to a referral representative, which in turn refers us to a marketing representative; (iii) marketing representative discusses and confers with management and refers us to their credit department; and (iv) credit department sends out letter of credit format to be provided to our financing institution.

As of the date of this Current Report, we have successfully completed these steps to obtain our approval/registration status in order to purchase and resell refined petroleum products. However, we still need to engage in further discussion with the marketing representative in order to solidify the procurement of fuels. And to further producer's requirements and support this new business function, we have arranged for a verbal multi-million dollar line of credit (which is standard within the petroleum industry) with a major private lender.

We are also finalizing negotiations of multiple international sales contracts for the delivery of crude petroleum products from specific producers. To facilitate these contracts, we have established a working partner relationship with Canaan Oilfield Services, LLC of Bellaire, TX. Management anticipates that this relationship will allow for deliveries of crude oil from the Bakken Shale Formation in North Dakota to various transload terminals in the Gulf Coast and West Coast areas.

U.S. Sand LLC Joint Venture

As of the date of this Current Report, we are negotiating the terms of a proposed joint venture with U.S. Sand, LLC, a privately held limited liability company organized under the laws of the State of Texas ("US Sand"). The purpose of this partnership will be to supply vital fracturing (frac) sand and related commodities to active, on-shore oil and gas drilling operations. US Sand already has contracts in place with major suppliers for large scale delivery of top quality frac sand and guar powder/gum. Additionally, we now have our own established source for the mineral barite (barium sulfate). All of these commodities are vitally needed in increasing quantities by modern, on-shore oil and gas drillers.

Since the start of 2012, we have been diligently developing our capabilities to move into the business of oilfield service and supply. New members of our management team have brought with them a wealth of business experience and connections in this area, which is now beginning to yield significant developments to the company. Management believes that our new relationship with US Sand will be a result of the well-established association between our Oilfield Service Specialist and member of our Board of Directors, Allen E. Lopez, and Mr. Jose Gonzalez, President of US Sand. We are currently negotiating the details of the proposed joint venture and will be visiting active oil/gas drillers in the Bakken and Eagleford Shales located in North Dakota and southern Texas. Management anticipates that the joint venture will be consummated, however, both joint venture parties remain in due diligence. Arrangements have been made to supply frac sand, guar gum, and barite to meet the regional demands. Representatives of both companies will be meeting in the future along with potential purchasers with the intent to enter into binding contracts in the near future.

We will also be working to set up arrangements for the shipment of crude oil products from the Bakken and Eagleford Shales to the Gulf Coast, and we are in negotiations with partners who have strategic petroleum terminals and Gulf Coast transloads. These shipments will be facilitated via our established working relationships between us and Canaan Oilfield Services, LLC of Bellaire, TX, and other partnership entities to be established.

Bateman Property Option

Effective on February 9, 2011, we entered into that certain Bateman Property Option (the “Option”) between with Richard and Gloria Kwiatkowski (collectively, the “Kwiatkowski”). The Option provides for the development of 136 claim units covering a series of nickel-colbalt-gold-platinum group element prospects, which prospects are located 35 kilometers northwest of Thunder Bay, Ontario (the “Prospects”). The Prospects are owned 100% by Kwiatkowski as tenants in common. We intend to work on the Prospects, including drilling, for three types of geological conceptual targets: (i) shebandowan type high grade nickel-cobalt-gold-platinum sulphide deposits; (ii) disseminated nickel sulphides of Mount Keith type with bulk tonnage potential; and (iii) gold mineralization within an extensive conglomerate unit of potential open-pit bult tonnage configuration.

In accordance with the terms and provisions of the Option: (i) upon execution of certain documentation and transfer of title, we will pay $5,000 and issue 250,000 shares of common stock to the Kwiatkowski; (ii) at the end of year one, we will pay to Kwiatkowski a further $20,000 either in half cash and half shares or all shares at the option of the Kwiatkowski; (iii) at the end of year two, we will pay to Kwiatkowski a further $30,000 either in half cash and half shares or all shares at the option of the Kwiatkowski will; (iv) each anniversary thereafter, we shall pay to Kwiatkowski $25,000 as advance royalty payment until the sum of $200,000 has been paid; (v) we shall further make payment to Kwiatkowski of 3% NSR royalty on all production from the Prospects, which royalty may be purchased by us as to 1.5% of the 3% for the sum of $1,500,000 in increments of $500,000 per 0.5% NSR; and (vi) we shall commit to expenditures of $200,000 on the Prospects.

On July 19, 2011, we paid $4,000 and incurred an additional $1,000 payable to purchase the Option. The prepaid royalty of $124,200 has been analyzed for impairment and fully impaired on the financials.

We also issued a convertible note of $20,000 to the Kwiatkowski, which was convertible into shares of our common stock at the market value of the shares on the date of the notice of conversion. Accordingly, on February 9, 2012 we issued to Richard and Gloria Kwiatkowski 256,411 and 256,410 shares, respectively, at the market price of $0.0390 to satisfy the $20,000 debt.

The prepaid royalty of $124,200 has been analyzed for impairment and has been fully impaired.

This liability is presented at the present value of expected future cash flow requirements.

Interest on the discounted royalty claim has been accreted at 12%. Accreted interest was $21,161 and $11,178 as of September 30, 2012 and December 31, 2011 respectively, which brings the liability balances to $141,361 and $135,378, respectively.

McNab Property

We have a mineral property, known as the McNab Molybdenum Property (the “McNab Property”). The McNab Property is comprised of one mineral claim containing 1 cell claim units totaling 251.11 hectares;

BC Tenure #		Work Due DateUnits		Total Area (Hectares)
831929		12		251.11

Summary Report of Geologist

The McNab Property is the subject to a Summary Report dated April 2006 prepared by Greg Thomson, B.Sc., P. Geo. and James Laird, Laird Explorations Ltd. The Report was prepared in compliance with National Instrument 43-101 and Form 43-101F1.

Mr. Thomson certified that the information contained in the report was based upon a review of previous reports and geological studies related to the property area and personal experience with local geology gained while employed as a consulting geologist in Southwest British Columbia.

Proposed Work Program

A proposed work program includes construction of a control grid, geological mapping and rock sampling of surface showings, a soil and silt geochemical sampling program, IP geophysical survey, and rock trenching. Based on a compilation of these results, a diamond drill program will be designed to explore and define the potential resources.

Phase 1. Reconnaissance geological mapping, prospecting and rock sampling, helicopter transportation.

Phase 2. Detailed geological mapping and rock sampling, grid construction, soil and silt geochemical survey, IP survey, establish drill and trenching targets.

Phase 3. 1000 metres of diamond drilling including geological supervision, assays, report and other ancillary costs.

Our business plan is to proceed with the exploration of our molybdenum property to determine whether there is any potential for molybdenum on the property that comprises our mineral claims. We have decided to proceed with the three phases of a staged exploration program recommended by the geological report. We anticipate that these phases of the recommended geological exploration program will cost approximately $25,000.00, $100,000 and $175,000 respectively. We had $0 in cash reserves as of the period ended December 31, 2009. The lack of cash has kept us from conducting any exploration work on the property. We will commence Phase 1 of the exploration program once we receive funding. Phase 2 and 3 will commence after completion of the Phase 1 program. As such, we anticipate that we will incur the following expenses over the next twelve months:

>> $25,000.00 in connection with the completion of Phase 1 of our recommended geological work program;

>> $100,000.00 in connection with the completion of Phase 2 of our recommended geological work program;

>> $175,000 for Phase 3 of our recommended geological work program; and

>> $10,000 for operating expenses, including professional legal and accounting expenses associated with compliance with the periodic reporting requirements after we become a reporting issuer under the Securities Exchange Act of 1934.

If we determine not to proceed with further exploration of our mineral claims due to a determination that the results of our initial geological program do not warrant further exploration or due to an inability to finance further exploration, we plan to pursue the acquisition of an interest in other mineral claims. We anticipate that any future acquisition would involve the acquisition of an option to earn an interest in a mineral claim as we anticipate that we would not have sufficient cash to purchase a mineral claim of sufficient merit to warrant exploration. This means that we might offer shares of our stock to obtain an option on a property. Once we obtain an option, we would then pursue finding the funds necessary to explore the mineral claim by one or more of the following means: engaging in an offering of our stock; engaging in borrowing; or locating a joint venture partner or partners.

PROPOSED FUTURE BUSINESS OPERATIONS

Our current strategy is to complete further acquisition of other mineral property opportunities, which fall within the criteria of providing a geological basis for development of mining initiatives that can provide near term revenue potential and production cash flows to create expanding reserves. We anticipate that our ongoing efforts, subject to adequate funding being available, will continue to be focused on successfully concluding negotiations for additional interests in mineral properties. We plan to build a strategic base of producing mineral properties.

We also plan on becoming involved in the United States domestic oil and gas reserves on-shore development. We believe that within the continental United States, thousand of wells are being drilled and will continue to be drilled over the next thirty years. The result will be that domestic energy production may provide an estimated 70% of the nation’s energy needs. However, the oil and gas reserves are trapped in hundreds of miles of brittle shale rock thousands of feet below the surface. Engineers have recently learned that the underground shale could be hydraulically fractured (frac-dilled”) with highly compressed sand, water and specialized chemicals thereby releasing huge quantities of oil and gas from a well. In more recent years, improved equipment and horizontal drilling techniques have increased the quantity of oil and gas and the estimated life that can be expected from wells drilled in the shale formation. This frac-drilling process has created economic boom conditions in North Dakota and southern Texas as these are the areas with some of the best geologic formations. We believe it has also created enormous demand for the equipment, personnel and materials required to drill economically feasible wells.

One of those vital materials for frac-drilling is a unique type of sand that can hold its shape under intense pressure and heat and is porous enough to allow thousands of gallons of oil or millions of cubic feet of gas to seep through it to the drill pipe. A typical frac-well will use 2,200 tons of this type of sand and its industry name is “frac-sand” or “proppant”. Of the on-shore domestic wells that are expected to be drilled in the coming years, over 90% are expected to need hydraulic fracturing, which will require millions of tons of frac-sand. We intend to participate in negotiations and discussions with potential joint venture parties regarding obtaining frac-sand reserves and establishing the infrastructure to deliver the sand to drilling sites.

Our ability to continue to complete planned exploration activities, expand acquisitions and explore mining opportunities and further potential operations involving the oil and gas industry and frac-drilling is dependent on adequate capital resources being available and further sources of debt and equity being obtained.

RESULTS OF OPERATIONS

Nine Month Period Ended September 30, 2012 Compared to Nine Month Period Ended September 30, 2011

Our net loss for the nine month period ended September 30, 2012 was ($1,048,431) compared to a net loss of ($903,262) during the nine month period ended September 30, 2011, an increase of $145,169. During the nine month periods ended September 30, 2012 and 2011, we did not generate any revenue.

During the nine month period ended September 30, 2012, we incurred operating expenses of $846,570 compared to $887,748 incurred during the nine month period ended September 30, 2011. Operating expenses incurred during the nine month period ended September 30, 2012 consisted of: (i) impairment of mineral property acquisition costs of $-0- (2011: $60,250); (ii) impairment of prepaid royalties of $-0- (2011: $124,200; (iii) professional fees of $775,634 (2011: $262,261); and (iv) general and administrative of $70,936 (2011: $481,151). Although our professional fees increased by $513,373 due to the increase in the scope and scale of our business operations involving identification of acquisition of further mineral properties and potential involvement in frac-drilling, the slight decrease in operating expenses was primarily attributable to a decrease in the following items: (i) $60,250 in impairment of mineral property - acquisition costs; and (ii) $124,200 in impairment of prepaid royalties. General and administrative expenses generally include corporate overhead, financial and administrative contracted services, marketing and consulting costs.

Other expenses incurred during the nine month period ended September 30, 2012 were interest expense of $81,827 (2011: $15,514); and (ii) financing cost - related party of $120,034 (2011: $-0-) resulting in total other expenses of $201,861 (2011: $15,514).

Thus, our net loss from operations during the nine month period ended September 30, 2012 was ($1,048,431) compared to a net loss from operations during the nine month period ended September 30, 2011 of ($903,262). The weighted average number of shares outstanding was 169,292,294 for the nine month period ended September 30, 2012 compared to 75,730,585 for the nine month period ended September 30, 2011.

We anticipate that we will not earn revenues until such time as we have entered into commercial production, if any, of our mineral properties. We are presently in the exploration stage of our business and we can provide no assurance that we will discover commercially exploitable levels of mineral resources on our properties, or if such resources are discovered, that we will enter into commercial production of our mineral properties.

Three Month Period Ended September 30, 2012 Compared to Three Month Period Ended September 30, 2011

Our net loss for the three month period ended September 30, 2012 was ($65,023) compared to a net loss of ($367,587) during the three month period ended September 30, 2011, a decrease of $302,564. During the three month periods ended September 30, 2012 and 2011, we did not generate any revenue.

During the three month period ended September 30, 2012, we incurred operating expenses of $37,503 compared to $359,770 incurred during the three month period ended September 30, 2011. Operating expenses incurred during the three month period ended September 30, 2012 consisted of: (i) professional fees of $22,217 (2011: $47,525); and (iii) general and administrative of $15,286 (2011: $312,245). The decrease in operating expenses was primarily attributable to a decrease in general and administrative of $296,959. The reason for this substantial decrease was based upon the restructuring of our operations and governance as well as closely monitoring our fiscal management.

Other expenses incurred during the three month period ended September 30, 2012 were interest expense of $27,520 (2011: $7,817).

Thus, our net loss from operations during the three month period ended September 30, 2012 was ($65,023) compared to a net loss from operations during the three month period ended September 30, 2011 of ($367,587). The weighted average number of shares outstanding was 174,369,485 for the three month period ended September 30, 2012 compared to 86,141,847 for the three month period ended September 30, 2011.

LIQUIDITY AND CAPITAL RESOURCES

Nine Month Period Ended September 30, 2012

As of September 30, 2012, our current assets were $2,902 and our current liabilities were $1,071,423, which resulted in a working capital deficit of $1,068,521. As of September 30, 2012, current assets were comprised of $2,902 in cash. As of September 30, 2012, our current liabilities consisted of: (i) $61,777 in accounts payable and accrued expenses; (ii) $77,998 in accounts payable – disputed; (iii) $563,206 in disputed liability - related party; (iv) $84,737 in accrued interest – related party; (v) $132,382 in note payable - related party; and (vi) $151,323 in debt – related parties.

As of September 30, 2012, our total assets were $2,902 comprised of current assets. Our total assets for fiscal year ended December 31, 2011 were $38,120.

As of September 30, 2012, our total liabilities were $1,246,784 comprised of: (i) current liabilities of $1,071,423; (ii) mineral prospect obligation of $145,361; and (iii) debt - long term of $30,000. Our total liabilities for fiscal year ended December 31, 2011 were $1,179,624. Our total liabilities increased primarily due to the increase in debt to related parties. We also recorded a disputed liability – related party. As of June 15, 2011, old management signed a board resolution approving the issuance of convertible promissory notes in the amount of $271,331 to Falco Investments Inc. (“Falco”). We believe that old management was not acting in our best interests when they authorized these expenses and subsequently approved the issuance of the convertible debts. As of March 31, 2012, we have recorded the balance of $737,963 due to Falco, of which $132,382 has been reported as convertible debt, $563,206 as a disputed liability – related party and $84,737 as accrued interest. We have decided to content the current balance claimed to be due to Falco. It is our position that these amounts due are frivolous. See “Item 3. Legal Proceedings”.

Stockholders’ deficit increased from ($1,141,504) as of December 31, 2011 to ($1,243,882) as of September 30, 2012.

Cash Flows from Operating Activities

We have not generated positive cash flows from operating activities. For the nine month period ended September 30, 2012, net cash flows used in operating activities was ($123,381) compared to net cash flow used in operating activities of ($78,357) during the nine month period ended September 30, 2011. Net cash flows used in operating activities consisted primarily of a net loss of ($1,048,431) (2011: $903,262), which was adjusted by: (i) $737,857 (2011: $392,833) in shares issued for services; (ii) $120,034 in financing cost of warrants issued (2011: $-0-); (iii) $-0- (2011: $124,200 in beneficial conversion feature; and (iv) $-0- (2011: $60,250) in impairment of prepaid royalties. Net cash flows used in operating activities during the nine month period ended September 30, 2012 was further changed by an increase of $11,569 in accounts payable, $43,856 in accrued interest to a related party, $17,734 in accreted interest on royalty obligation and a decrease of ($6,000) in accounts payable. Net cash flows from operating activities during the nine month period ended September 30, 2011 was further changed by an increase of $79,544 in accounts payable, $153,396 in accounts payable - related party, $8,062 in accrued interest to a related party, $7,452 in accreted interest on royalty obligation, and a decrease of ($832).

Cash Flows from Investing Activities

For the nine month periods ended September 30, 2012 and September 30, 2011, net cash flows used in investing activities was $-0- .

Cash Flows from Financing Activities

For the nine month period ended September 30, 2012, net cash flows provided by financing activities was $88,163 consisting of $10,843 in proceeds from subscriptions payable, $67,320 in proceeds from issuances of common stock and $10,000 from proceeds from subscriptions receivable. For the nine month period ended September 30, 2011, net cash flows provided by financing activities was $100,000 consisting of $45,000 in subscriptions payable and $55,000 in issuance of common stock.

PLAN OF OPERATION AND FUNDING

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next six months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) oil and gas operating properties; (ii) possible drilling initiatives on current properties and future properties; and (iii) future property acquisitions. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

MATERIAL COMMITMENTS

Consultant Agreement

On October 1, 2010, we entered into a five year consulting agreement with Dr. Stewart Jackson, our then President/Chief Executive Officer (the “Consultant Agreement”). In accordance with the terms and provisions of the Consultant Agreement, we were to pay to Dr. Jackson a monthly compensation of $2,000, which could be paid by cash or issuance of shares of common stock priced at the ten-day average each month. Through June 30, 2011, Dr. Jackson earned $18,000 of which $8,000 had been paid in cash leaving a balance of $10,000. We have recognized the future remaining obligation of the Consultant Agreement and accrued it at its present value on the financial statements using a 12% discount rate over fifty-one months. This results in an $89,595 increase in consulting fees for fiscal year ended December 31, 2011 and a convertible debt in the same amount. In addition to the $89,596, another $5,976 was accrued as of December 31, 2011 and interest expense of $7,751 has been recorded for the nine months ended September 30, 2012, for a total convertible debt of $103,323 at September 30, 2012.

Falco Investments Inc.

Effective on October 21, 2010 (the “Effective Date”), we entered into a series of convertible promissory notes in various principal amounts (collectively, the “Convertible Promissory Notes”) with Falco Investments, Inc. (the “Creditor”), of which $132,382 is represented in principal. As of December 31, 2011, we recorded a total of $716,469 due to the Creditor, of which $132,382 has been reported as convertible debt, $563,206 as a disputed liability – related party and $42,375 as accrued interest. The Creditor had agreed to waive all interest and accrued interest up to March 31, 2011. Interest on the convertible debt has been accrued at 12% for the remainder of fiscal year 2011. During the nine month period ended September 30, 2012, an additional $84,737 in interest accrued. The accrued interest of $84,737 as of September 30, 2012 recorded as "interest expense - related party".

We have recognized $39,715 in beneficial conversion feature costs in connection with the convertible note. If the total $132,382 is converted, approximately 13,238,200 shares of common stock would be issued. The Creditor believes that we are obligated to reissue $271,331 of the total debt as notes convertible at about 80% of the fair value of the stock but we have not yet done so. If fully converted, approximately 27,133,109 new shares of common stock would be issued.

We have decided to contest the current balance claimed to be due to the Creditor. It is our opinion that these amounts due are baseless. No additional liabilities were recorded

Figueiredo Consultant Agreement

On October 1, 2010, we entered into a one-year consulting agreement with David Figueiredo, our prior President/Chief Executive Officer and prior member of the Board of Directors (the “Figueiredo Consultant Agreement”). In accordance with the terms and provisions of the Figueiredo Consultant Agreement, we were to pay to Mr. Figueiredo monthly compensation of $4,000. As of June 30, 2012, the amount owed to Mr. Figueiredo is $48,000 or the issuance of 1,600,000 shares of common stock at $0.03 per share.

PURCHASE OF SIGNIFICANT EQUIPMENT

We do not intend to purchase any significant equipment during the next twelve months.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant 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.

GOING CONCERN

The independent auditors' report accompanying our December 31, 2011 and December 31, 2010 financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared assuming that we will continue as a going concern, which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

ITEM III. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk represents the risk of loss that may impact our financial position, results of operations or cash flows due to adverse change in foreign currency and interest rates.

Exchange Rate

Our reporting currency is United States Dollars (“USD”). In the event we acquire any properties outside of the United States, the fluctuation of exchange rates may have positive or negative impacts on our results of operations. However, since all of our properties are currently located within the United States, any potential revenue and expenses will be denominated in U.S. Dollar, and the net income effect of appreciation and devaluation of the currency against the U.S. Dollar would be limited to our costs of acquisition of property.

Interest Rate

Interest rates in the United States are generally stable. Any potential future loans will relate mainly to acquisition of properties and will be mainly short-term. However our debt may be likely to rise in connection with expansion and if interest rates were to rise at the same time, this could become a significant impact on our operating and financing activities. We have not entered into derivative contracts either to hedge existing risks for speculative purposes.

ITEM IV. CONTROLS AND PROCEDURES

FINANCIAL DISCLOSURE CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president/chief executive officer and our secretary, treasurer/chief financial officer to allow for timely decisions regarding required disclosure.

As of September 30, 2012, we carried out an evaluation, under the supervision and with the participation of our president/chief executive officer and our chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president/chief executive officer and chief financial officer concluded that our disclosure controls and procedures were not effective in providing reasonable assurance in the reliability of our financial reports as of the end of the period covered by this quarterly report. Effectiveness of disclosure controls was primarily a function of our current scale and scope of operations which are relatively non-complex with a limited volume of transactions and capital resources.

The matters involving internal disclosure controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were:

1.	Lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures;

2.	Inadequate segregation of duties consistent with control objectives; and

3.	Ineffective controls over period end financial disclosure and reporting processes.

The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of September 30, 2011.

Management believes that the material weaknesses set forth in items (2) and (3) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

Management’s Remediation Initiatives

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

1.	We have formed an audit committee.

2.	We are seeking to add additional personnel, who may be appointed to our board of directors as outside members and/or serve in a capacity to allow us to better segregate job responsibilities.

3.	We have developed internal control procedures over financial disclosure and reporting. However, these procedures are, and will continue to be, ineffective without additional personnel.

Changes in internal controls over financial reporting

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

AUDIT COMMITTEE

Our Board of Directors has established an audit committee. Effective August 12, 2011, Glenn Soler and Jerry Drew have been appointed as members of the Audit Committee. Both are independent members of the Audit Committee. The audit committee's primary function is to provide advice with respect to our financial matters and to assist our Board of Directors in fulfilling its oversight responsibilities regarding finance, accounting, and legal compliance. The audit committee's primary duties and responsibilities is: (i) serve as an independent and objective party to monitor our financial reporting process and internal control system; (ii) review and appraise the audit efforts of our independent accountants; (iii) evaluate our quarterly financial performance as well as its compliance with laws and regulations; (iv) oversee management's establishment and enforcement of financial policies and business practices; and (v) provide an open avenue of communication among the independent accountants, management and our Board of Directors.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

On November 23, 2011, a complaint was filed in the Supreme Court of British Columbia, File No. S-115321, by Falco Investments, Inc. ("Falco") naming us as a defendant (the "Complaint"). In the Complaint, Falco alleges that we owe $690,587.77 as compensation for corporate work performed by Falco through June 30, 2011. We have responded in our answer and stated that we do not owe the $690,587.77 for such services allegedly performed by Falco since there was no written contract between us and Falco. We have counterclaimed and named the former president/chief executive officer, Dr. Stewart Jackson and Donald Rutledge and Leslie Rutledge as defendants. We believe that the Complaint is frivolous and has no merit.

Other than the Civil Claim, we are not a party to any material legal proceedings and to our knowledge; no such proceedings are threatened or contemplated.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

During the nine month period ended September 30, 2012, we authorized the issuance of shares of our restricted common stock as follows:

SHARES ISSUED TO DIRECTORS

Allen Lopez

On April 5, 2012, we authorized the issuance of an aggregate 5,000,000 shares of our restricted common stock to Allen Lopez as consideration for appointment and role as a member of the Board of Directors. The aggregate of 5,000,000 shares of common stock will be issued to Mr. Lopez as a United States resident in reliance on Section 4(2) promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. Mr. Lopez acknowledged that the securities to be issued have not been registered under the Securities Act, that he understood the economic risk of an investment in the securities, and that he had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

Glenn Soler

On February 9, 2012, we issued an aggregate of 1,000,000 shares pursuant to a consulting agreement with Glenn Soler, for consultant services rendered. The shares were issued at $0.039 per share. Of this issuance $6,000 was in satisfaction of payable owed to Mr. Soler as of March 31, 2012 and the remaining $33,000 is recorded as a related party expense. The aggregate of 5,000,000 shares of common stock will be issued to Mr. Soler as a United States resident in reliance on Section 4(2) promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. Mr. Soler acknowledged that the securities to be issued have not been registered under the Securities Act, that he understood the economic risk of an investment in the securities, and that he had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

Keith Tubandt

On November 1, 2012, we issued an aggregate of 3,000,000 shares of our restricted common stock to Keith Tubandt as consideration for appointment and role as a member of the Board of Directors. The aggregate of 3,000,000 shares of common stock were issued to Mr. Tubandt as a United States resident in reliance on Section 4(2) promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. Mr. Tubandt acknowledged that the securities to be issued have not been registered under the Securities Act, that he understood the economic risk of an investment in the securities, and that he had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

BATEMAN OPTION

On February 9, 2012, we issued an aggregate of 512,821 shares of common stock to the Kwiatkowski in accordance with the terms and provisions of the Option and conversion of a $20,000 debt. The aggregate of 512,821 shares of common stock were issued to non-United States resident in reliance on Regulation S promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. The Kwiatkowski acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

SHARES ISSUED TO CONSULTANTS

We authorized the issuance of an aggregate 14,500,000 shares of common stock to independent contractors for services rendered. The per share issuance price ranged from $0.039 to $0.015. The aggregate of 14,500,000 shares of common stock were issued to United States residents in reliance on Regulation D promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. The consultants acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

SHARES ISSUED IN PRIVATE PLACEMENT OFFERINGS

We authorized the issuance of an aggregate of 7,093,325 shares of common stock to investors at per share prices ranging from $0.02 to $0.005. The aggregate of 7,093,325 shares of common stock were issued to United States residents in reliance on Regulation D promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. The investors acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

During the three month period ended September 30, 2012, we issued a further 3,995,000 shares of common stock to two United States residents.

Of the 7,093,325 shares issued, 133,330 shares were cancelled and returned to treasury.

SUBSCRIPTIONS PAYABLE

We authorized the issuance of an aggregate of 17,160,000 shares of common stock at per share prices ranging from $0.02 to $0.0075. The aggregate of 17,160,000 shares of common stock were issued to United States residents in reliance on Regulation D promulgated under the Securities Act. The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. The investors acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURE

Not applicable.

ITEM 5. OTHER INFORMATION.

DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS

President/Chief Executive Officer

Effective on August 27, 2012, our Board of Directors accepted the resignation of David Figueiredo as our President/Chief Executive Officer and a member of the Board of Directors. Mr. Figueiredo did not resign as a result of any disagreement with us on any matter relating to our operations, policies or practices.

Effective on August 27, 2012, our Board of Directors accepted the consent of Jerry Drew, who is a current member of the Board of Directors, as our President/Chief Executive Officer.

The Board of Directors believes that our business plans have progressed to the point where a revision of management responsibilities would better suit the projects and plans currently under development. In accordance with this progress, the Board of Directors appointed Mr. Drew as our new President/Chief Executive Officer. Mr. Drew will take over our daily operations for Mr. Figueiredo who will now work outside the company on field projects and researching new, potential business opportunities.

During the past thirty years, Jerry Drew has been a successful leader in business development and marketing. Mr. Drew’s marketing experience started in the early 1980s where he was employed with J.D. Barton Company which distributes lighting fixtures to major electrical wholesalers in the Sacramento Valley and throughout northern California. Later, Mr. Drew developed and implemented a successful marketing plan for Mendocino Mineral Water. Subsequently, Mr. Drew started Jerold S. Drew Painting which remains in profitable business operation today. He also owns the successful business of Spencer Vineyards in Redwood Valley, California.

Member of Board of Directors

Resignation

Effective on March 25, 2012, our Board of Directors accepted the resignation of Paul Murphy as a member of the Board of Directors. Mr. Murphy, however, will remain as the president and sole director of our subsidiary, Denarii Resources, Inc., an Ontario corporation.

Appointment

Effective on April 5, 2012, our Board of Directors accepted the consent of Allen E. Lopez as a member of the Board of Directors.

Biography. During the past thirty years, Allen Lopez has been involved in the real estate industry and the oil and gas industry. Currently, Mr. Lopez is a director of oilfield services with M. Nasr Partners P.C., where he has been involved in mixed use planned development projects for the past ten years. Mr. Lopez was also the former president of Canaan Consulting, Inc., where he had over twenty years experience in real estate, which included working for national home builders and international development companies. Mr. Lopez also acted as general partner for many of his own projects where he developed extensive experience in master planned communities, town homes, single/multi-family residences, custom homes, high rise condominiums and multi-use/office retail projects. Certain of these projects include the following:

M. Nasr Partners

Heron Lakes - Master Planned/Mixed Use Golf Course Community (550 acres, includes office, hotel, retail, townhome, single family starter and single family custom)

o			Indio Springs – Master Planned/Mixed Use Golf Course Community (600 acres, includes hotel, country club, condominiums, single family and custom homes)
o			Lake Conroe Hills – (300 lot waterfront single family development with marina)

o	Island Park – Master Planned/Mixed Use Water Front Community (700 acres, includes single family, acre+ estate homes, yacht club, marina, hotel & conference center)
o	Parkway Lakes – (220 acre single family community w/retail frontage)
o	Cypress Wood Trails – (60 acre 328 lot manufactured home community)
o	Parkway Village (Dutton) – (110 acre Commercial/Mixed Use property with senior citizen aging in place housing)

David Weekley Homes/McGuire Home Builders

o			Grand Mission – 688 acre Master Planned/Mixed Residential Development
o			Mission Bend – 200 acre Single Family Starter Community

George Whimpey Development – Morrison Homes

O		Aberdeen Trails – 300 acre Single Family First Move Up Community
O		Aberdeen Green – 1100 acre First Time Home Buyer Community

Westfield Estates – 600 acre Mixed Use First/Second Move Up Community

Ryland Homes

Heron Lakes – 127 lot Golf Course Townhome Community

Lake Olympia – 300 Acre Water Front Mixed/Use Master Planned Community

Commonwealth Housing Corporation

O		Tapatio Springs – 1600 acre Master Planned/Mixed Use Golf Course Resort Community with residential single family and custom homes
O		Rancho Sierra – 1200 acre Estate Lot Custom Community

o	Mason Heights – 170 acre single family starter community
o	Savannah Plantation – 1600 acre Estate Lot Custom Lakefront Community
o	Sienna Plantation – 2400 acre Master Planned/Mixed Use Golf Course Community with single family and custom homes
o	Greenhouse Landing – 110 lot Starter Home Community

Pavillion Development (Hispanic First Time Homebuyer Communities)

o	Las Brisas – Single Family starter homes
o	Las Terrazas – Single Family starter homes
o	Las Alamedas – Single Family starter homes

Avante REIT

o	1400 acre Land Acquisition

Ariete Holdings

o	700 acre Land Acquisition

Alpha Tech Development

o	Rose Lakes – 330 acre Master Planned/Mixed Residential Development

Advantage Capital Funding, Noble Mortgage, Money Mortgage & Atlas Development

o	Acted as a project evaluation consultant on a various Residential/Land/Commercial/Mixed Use projects

Mr. Lopez has been seated on the international real estate council for Gerson Lehrman. Mr. Lopez has also been retained by many REIT’s banks, development companies, franchise companies and land owners to assist in the determination of the best use, marketing strategies, development, acquisition and disposition of properties.

Appointment

Effective on November 1, 2012, our Board of Directors accepted the consent of Keith A. Tubandt as a member of the Board of Directors. Mr. Tubandt has over thirty years involvement in projects for locating, mining, testing and delivering critical fracturing (frac) sand for oilfield service operations. Mr. Tubandt joins the Company at this time to advance and expand its move into the new business venture of servicing the oil/gas drilling industry. This new venture has been underway since the beginning of 2012 and is meeting positive initial results. Mr. Tubandt will help to develop the Company's frac sand customer base via his established business contacts as well as oversee specific operations including the following: (i) drilling new frac sand deposits for proving reserves; (ii) testing frac sand samples against API specifications for customers; (iii) performing preliminary design of new frac sand plants with capacities of 1-2 million tons per year of final products; and (iv) searching for new frac sand suppliers for oil service companies.

Biography. During the past thirty years, Mr. Tubandt has been involved in the oil and gas industry. From approximately 2010 to 2012, Mr. Tubandt provided consulting services related to the design and building of a $45,000,000 frac sand transload facility in Texas, which currently receives 100-car unit trains to be unloaded into storage silos.

From approximately 2008 through 2010, Mr. Tubandt was the managing partner of DeKat Consulting. He also provided consulting services to Guardian Industries to aid in the improvement of raw materials (sand, limestone and dolomite) for their glass plants. Mr. Tubandt also consulted for several other industrial mineral companies for improvement to their mineral processes. He also provided consulting services to Canadian Silica Inc. to improve the dry process design by streamlining the process and eliminating the bottlenecks in order to meet the required design capacity. His consulting services at Canadian Silica Inc. further involved a start-up of a 150 tph wet sand plant in northern Alberta, which had been stagnant for eight years due to lack of market and problems with the plant operation and design. Mr. Tubandt was successful in enabling the plant to meet its design of 150 tph on a continuous basis by designing and implementing a computer control system for plant operation and developing a quality control program and training personnel to meet API specifications. Lastly, during this period, Mr. Tubandt completed the design, business plan and solicitation of contracts to build a $50,000,000 sand processing plan in the western part of the United States. The sand is to be used for the manufacture of solar glass panels.

During approximately 2006 through 2007, Mr. Tubandt provided consulting services to Pattison Sand Company where he was responsible for completing the design, construction, start-up and training of personnel for a $45,000,000 frac sand plant in Iowa. This also included implementation of a preventative maintenance program and modification of the design after start-up to allow for the production of glass sand. The plant was designed to produce five different frac sand products for use in the oil/gas well stimulation companies. During this time, Mr. Tubandt also provided consulting services to Harwest Industrial Minerals Corporation where he was responsible for the design, construction and start-up of a $32,000,000 frac sand plan in Nebraska. The plant was designed to produce 16/30 and 20/40 frac sand for the oil/gas well stimulation companies.

During approximately 1996 through 2005, Mr. Tubandt was the general manager of DeKat Consulting where his duties included moving to Venezuela for three years to manage and rebuild a glass sand mine. The production rate of the glass sand mine was improved by 400% and quality was further improved by installation of a new granumetric sizing section and installation of a preventative maintenance plan for the operation. During this time, Mr. Tubandt also provided consulting services for a major world float glass producer which required travel to India, Thailand, Spain, Mexico, Brazil, Russia, Israel, Jordan and several other countries to evaluate the raw material suppliers for the glass plants owned by the float glass producer. While in these countries, he also provided consulting services relating to the design, building and start-up of complete or partial mining operations for silica sand, dolomite and limestone.

During approximately 1986 through 1995, Mr. Tubandt was the technical manager of a urethane applications company where his duties included working with mining operations in the United States to improve plant maintenance by the correct installation of polyurethane to improve the life of each piece of equipment in the plants thereby reducing overall maintenance costs of each of the plants and increasing productions rates.

During approximately 1977 through 1979, Mr. Tubandt was a metallurgist/plant superintendent in a phosphate mine where his duties included working in the metallurgy department to improve plant recoveries of the phosphate in the flotation part of the mine. He was promoted to plant superintendent in a 50,000 ton per day processing plant where his duties included the supervision of seventy people, scheduling of preventative maintenance in the plant, maintaining a consistent product quality and improvements to the production rate of the mining operation.

During approximately 1974 through 1976, Mr. Tubandt was a process engineer in a titanium mine where his duties included the building of a pilot plant to determine the correct piece of equipment to be installed to increase recovery of the plant by 15% and a process engineer in an iron pyrite mine where his duties included the testing and evaluation of the process of concentrating iron ore, copper ore and zinc ore and conducting studies for the improvement in processing copper into pure copper ingots and the quality of iron ore processed into iron ore pellets.

Mr. Tubandt earned a BS Degree in chemical engineering in 1974 from the South Dakota School of Mines and Technology.

Therefore, as of the date of this Quarterly Report, our Board of Directors consists of Jerry Drew, Glenn Soler, Marc Duncan, Allen Lopez and Keith Tubandt.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

Exhibit Number		Description

3(i)		Articles of Incorporation (1)

3(ii)		Bylaws (1)

10.1		Consulting Agreement dated October 1, 2010 between Denarii Resources, Inc. and LV Media Group.(2)

10.2		Consulting Agreement dated October 1, 2010 between Denarii Resources, Inc. and Paul Murphy. (2)

10.3		Consulting Agreement dated November 1, 2010 between Denarii Resources, Inc. and Ariel Serrano.(2)

10.4		Consulting Agreement dated October 1, 2010 between Denarii Resources, Inc. and Steve Claus. (2)

10.5		Consulting Agreement dated October 1, 2010 between Denarii Resources, Inc. and David Figueiredo.(2)

10.6		Consulting Agreement dated October 1, 2010 between Denarii Resources, Inc. and Stewart Jackson. (2)

10.7		Convertible Promissory Note between Denarii Resources, Inc. and Falco Investments, Inc. dated October 21, 2010 in the principal amount of $64,607.37. (3)

10.9		Convertible Promissory Note between Denarii Resources, Inc. and Falco Investments, Inc. dated October 21, 2010 in the principal amount of $67,774.88. (3)

10.10		Convertible Promissory Note between Denarii Resources, Inc. and Falco Investments, Inc. dated October 21, 2010 in the principal amount of $38,635.21. (3)

10.11		Convertible Promissory Note between Denarii Resources, Inc. and Falco Investments, Inc. dated October 21, 2010 in the principal amount of $60,186.33. (3)

10.12		Convertible Promissory Note between Denarii Resources, Inc. and Falco Investments, Inc. dated October 21, 2010 in the principal amount of $38,708.53. (3)

7.1		Letter of Agreement from Seale & Beers, CPA (4)

16.1		Letter from Seale & Beers, CPA (5)

99.1		Summary Report on the McNab Molybdenum Property, HowSound BC dated April 2006 by Greg Thomson B.Sc., P. Geo. and James Laird, Laird Exploration Ltd.

31.1		Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act.

31.2		Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act.

32.1		Certification of Chief Executive Officer and Chief Financial Officer Under Section 1350 as Adopted Pursuant To Section 906 of the Sarbannes-Oxley Act.

101.INS **		XBRL Instance Document

101.SCH **		XBRL Taxonomy Extension Schema Document

101.CAL **		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF **		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB **		XBRL Taxonomy Extension Label Linkbase Document

101.PRE **		XBRL Taxonomy Extension Presentation Linkbase Document

(1) Incorporated by reference from our Registration Statement on Form SB-2 filed with the Commission on June 16, 2006.

(2) Incorporated by reference from our Current Report on Form 8-K filed with the Commission on March 21, 2011.

(3) Incorporated by reference from our Current Report on Form 8-K filed with the Commission on November 12, 2010.

(4) Incorporated by reference from our Current Report on Form 8-K and 8-K/A filed with the Commission on April 21, 2010, May 12, 2010 and May 27, 2010.

(5) Incorporated by reference from our Current Report on Form 8-K filed with the Commission on June 5, 2012.

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

SIGNATURES

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

	DOUBLE CROWN RESOURCES, INC.

Dated: November 13, 2012	By:	/s/ Jerry Drew
		Jerry Drew
		President/Chief Executive Officer

	DOUBLE CROWN RESOURCES, INC.

Dated: November 13, 2012	By:	/s/ Jerry Drew
		Jerry Drew
		Chief Financial Officer

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