Filed by sedaredgar.com - Sun Cal Energy Inc.

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

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

Check whether the Issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities 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[ ]

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. Yes [x] No[ ]

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 aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked prices of such common equity, as of a specified date within 60 days. (See definition of affiliate in Rule 12b-2 of the Exchange Act.)

Note: If determining whether a person is an affiliate will involve an unreasonable effort and expense, the issuer may calculate the aggregate market value of the common equity held by non-affiliates on the basis of reasonable assumptions, if the assumptions are stated.

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 82,796,666 shares of common stock as at September 15, 2008.

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors”, that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this annual report.

In this annual report, unless otherwise specified, all references to “common shares” refer to the common shares in our capital stock and the terms “we”, “us”, “our” and “Sun Cal” means Sun Cal Energy, Inc. and our wholly-owned subsidiaries, Sun Cal Energy Corp., a Nevada corporation and Sun Cal Energy Canada Corp., a British Columbia corporation.

We were incorporated under the laws of the State of Nevada on July 20, 2004 under the name Host Ventures, Inc. On November 6, 2006, we changed our name to Sun Cal Energy, Inc. through a merger with our wholly owned subsidiary, which was incorporated solely for the purpose of the name change.

On November 6, 2006, we completed a merger with our subsidiary, Sun Cal Energy, Inc. As a result, we changed our name from "Host Ventures Inc." to "Sun Cal Energy, Inc." We changed the name of our company to better reflect the possible new direction and business of our company. In addition, effective November 6, 2006 we effected a 10 for one forward stock split of our authorized, issued and outstanding common stock. As a result, our authorized capital increased from 75,000,000 shares of common stock with a par value of $0.001 to 750,000,000 shares of common stock with a par value of $0.001.

During our quarter ended December 31, 2006, we abandoned our mineral property, the Scaddign West Claim. Because of limited disturbance during our exploration of the property, we were able to abandon the property with minimal reclamation obligations. In connection with the acquisition of our subsidiaries in late 2006, we have changed our business plan to focus on the acquisition and exploration of oil and gas properties.

On January 31, 2007, we entered into a share exchange agreement with all of our shareholders of Sun Cal Energy Corp., a privately-owned Nevada company, whereby we agreed to acquire all the issued and outstanding common stock of Sun Cal Energy Corp. Under this share exchange agreement, we agreed to issue one share of our common stock for each issued and outstanding share of common stock of Sun Cal Energy Corp. As at January 31, 2007, there were 26,925,000 shares of common stock of Sun Cal Energy Corp. issued and outstanding. On March 12, 2007 we completed the transaction contemplated under the share exchange agreement between our company and the shareholders of Sun Cal Energy Corp. whereby we acquired all the issued and outstanding common stock of Sun Cal Energy Corp., which then became our wholly owned subsidiary.

Sun Cal Energy Corp. was a privately-owned Nevada corporation engaged in oil and gas exploration. Since we acquired all of the issued and outstanding common stock of Sun Cal Energy Corp., we have also indirectly acquired 100% of the issued and outstanding common stock of Sun Cal Energy Canada Corp., a wholly owned subsidiary of Sun Cal Energy Corp. Sun Cal Energy Canada Corp. was incorporated in the Province of British Columbia on June 5, 2006. In October 2006, Sun Cal Energy Corp. entered into an agreement with TriMar Energy Partners, Inc. to acquire an one and one half percent (1.5%) of 8/8ths overriding royalty interest in an oil and gas lease known as the Hobart Lease and an agreement with Western Energy Capital, LLC. to acquire an undivided 45% interest in certain oil and gas leases known as the Lokern Leases.

We are in the business of oil and gas exploration. In October 2006, Sun Cal Energy Corp. entered into two agreements: an agreement with TriMar Energy Partners, Inc. to acquire an one and one half percent (1.5%) of 8/8ths overriding royalty interest in an oil and gas lease known as the Hobart Lease and an agreement with Western Energy Capital, LLC. to acquire an undivided 45% interest in certain oil and gas leases known as the Lokern Leases. To date significantly all of our revenues have been derived from our holding of a 1.5% of 8/8th overriding royalty interest in an oil and gas lease from the City of Hobart, as the lessor, covering a total of 1,211.44 acres in the city of Hobart, Washita County, Oklahoma, and we have losses since our inception. We currently rely upon the sale of our securities to fund operations.

The Hobart Lease is an oil and gas lease obtained by TriMar Energy Partners, Inc., as the lessee, from the City of Hobart, as the lessor, dated April 1, 2004, and as recorded on Book 983, official records, Washita County, Oklahoma, covering a total of 1,211.44 acres in the city of Hobart, Washita County, Oklahoma. We paid a total of $525,000 and 1,500,000 shares of common stock to TriMar Energy Partners, Inc. and its designates to earn the one and one half percent (1.5%) of 8/8ths overriding royalty interest in the Hobart Lease.

On April 27, 2007, the operator on the Hobart Lease, Marathon Oil, spudded and began drilling a deep development gas well on our Hobart Lease interest in Washita county, Oklahoma. The well, the Sturgeon.1-11, was set to test through the Springer formation and was targeting multiple pay zones. Up to April 27, 2007, the Sturgeon 1-11 had successfully reached a depth of 17,400 feet with a total authorized depth of 20,000 feet. By May 30, 2007, well data collection and evaluation were completed on the Sturgeon 1-11 well, which was deemed commercially viable. The well reached a final depth of 19,990 feet on May 15, 2007 after slightly more than 3 months of drilling. To help evaluate the amount of pay encountered in the well, an open hole logging suite consisting of density, neutron, HRI induction, sonic, and gamma tools was run to a depth of 19,980 feet. The operator on the Hobart Lease, Marathon Oil, then ran production casing to a depth of 19,978 feet. The Sturgeon 1-11 well began production in June of 2007 and has produced a total of 470,409 mcf of natural gas up to June of 2008.

On July 11, 2007, a second permit was filed and drilling and testing of a second deep development well on the Hobart Prospect in Washita, County, Oklahoma. On September 6, 2007, the second deep development gas well, Cunningham 1-2, was spudded and drilling activities begun. The target depth was the Springer Morrow, which has proved to be productive in Oklahoma and Texas. The Cunningham 1-2 well began production in June of 2007 and has produced a total of 1,285,074 mcf of natural gas up to June of 2008.

On August 28, 2007, Range Production company filed for a third well to be drilled on our Hobart Prospect in Oklahoma. Filed before the Corporation Commission of the State of Oklahoma, Range Production Company was seeking to establish a 640-acre drilling and spacing unit and pooling orders for a third scheduled well in Section 14,

Township 8 North, Range 18 West in Washita County, Oklahoma. With a target depth of 19,800 feet, the estimated completion costs for this well are estimated at $12,245,000.

The Lokern Leases are a collection of 34 oil and gas exploration leases entered into by Western Energy Capital, LLC. with various private parties between November 2005 to May 2006. These leases are located in Kern County, California. We paid an aggregate of $125,000 and 1,300,000 shares of our common stock to Western Energy Capital, LLC and its designates to acquire an undivided 45% of all rights, title and interests in the Lokern Leases. Pursuant to this agreement, Western Energy Capital, LLC agrees that all leases made part of the agreement will be executed and assigned to our company in a timely manner and Western Energy Capital, LLC will issue our company a standard joint operating agreement. All leases and assignments taken by Western Energy Capital, LLC for our company shall call for Western Energy Capital, LLC to deliver a 75% Net Revenue Interest to our company.

On June 15, 2007, we acquired additional 2-D seismic data relating our Lokern Leases in California. Acquisition of the data will allow for additional geophysical correlation and interpretation of our Lokern Leases and allow our company to firm up well locations for drilling in 2007. The additional seismic data will also provide insight into the reserve estimates of the prospect. Regional 2-D seismic data is a key tool for oil and gas exploration due to its affordability and wide area of coverage compared to 3-D data. The acquisition of this data set is in line with our exploration program and initiatives, and will allow greater marketability of our prospect to large exploration and production companies.

Sun Cal Energy has the exclusive oil and gas rights for the Lokern Prospect which comprises approximately 400 acres of prime land in the oil and gas rich Kern County region, the most prolific area in the San Joaquin Valley in Southern California. Our company owns a 45% Working Interest and a 75% Net Revenue Interest in the prospect. On October 18, 2007, we assigned back to a designate of Western Energy Capital, LLC a 5% overriding royalty interest net to our 45% Working Interest for a net 2.25% overriding royalty interest in the Lokern Prospect. We are still working with Western Energy Capital, LLC to assigned the working interests in these leases to our company and Western Energy Capital, LLC will issue our company a standard joint operating agreement.

On April 19, 2007, we entered into an agreement with Western Energy Capital, LLC (“Western”) to acquire a partial interest in the “Britlind” Prospect and leases situated in the prolific Breton Sound area, offshore Louisiana. Western has originally entered into an agreement with BTE Energy, LLC (“BTE”) whereby Western acquired a contractual interest in the Britlind Prospect from BTE, including all rights and privileges to approximately 9,440 acres of State of Louisiana leases, ownership interest in approximately 25 square miles of 3D seismic data, and interests in certain hardware and software in conjunction with the interpretation and display of the 3D seismic data. In April and May of 2007, we paid an aggregate of $640,000 to Western Energy Capital, LLC pursuant to the agreement for a 5% working interest in the Britlind Prospect lease interests, seismic data, hardware and software and ongoing rights to an area of mutual interest. We also issued 400,000 shares of our common stock to Western Energy Capital, LLC or its designates. It was also acknowledged that the Britlind Prospect leases were originally acquired under the name of McGuinty Durham and Associates and assignment of leasehold out of McGuinty Durham and Associates will be made in due course. At such time Western Energy Captial will take appropriate actions to assign the interest to our company. Also pursuant to this agreement, we agreed to pay our proportionate share of all expenses, including geological, rentals and additional leases, etc. from May 11, 2007 and on.

In June of 2008, we received a well proposal from TDE Property Holdings LP to drill the SL 18994, Well No. 1 in Breton Sound Block 2, Eloi Bay Field, St. Bernard Parrish, Louisiana. The costs for drilling and testing the well was estimated to be $2,219,000. After careful consideration, our company decided to elect not to participate for the 5% working interest share of the well, at an estimate net cost of $110,950.

On October 1, 2007, we acquired a 5% Overriding Royalty Interest in the Centurion Property from King Royalty Corporation pursuant to an offering of royalty interests by King Royalty Corporation. The Centurion Property combines more than 17,000 acres of producing oil and gas assets across Texas, Oklahoma, Alabama, Louisiana and Mississippi. There are 153 producing wells on the asset with more than 50 additional proven/undeveloped drilling sites. Current production is comprised of 90% natural gas and 10% oil. Well operators include companies such as Exxon, Kerr-KcGee, Hunt Oil, Quicksilver and Vintex. As an interest holder we are entitled to share in revenues generated from oil and/or gas production from wells located on the Centurion Property. Approximately 90 days after the operators of the wells on the properties sell oil and gas production to local purchasers, we are entitle to receive payment of revenues generated by those wells attributable to our interest. However, we have no control over when we receive our payment of revenues, as each operator has its own internal policies and procedures regarding the transfer of ownership. As an interest holder we have no responsibility for operating expenses incurred in connection with the operation of wells on the properties. Lastly, we do not have responsibility for liabilities to third parties resulting from operations on the properties, which is the responsibility of the operators of the properties and the owners of working interests.

On August 15, 2007, we entered into an agreement with Desert Mining, Inc. to acquire a 100% working interest in 6,000 acres of leases in the Jonah Field region of Wyoming. This is the fourth core exploration and development region for our company. Our Jonah Prospects are identified as South Jonah, which consists of 2,477.68 acres and West Jonah, consisting of 3,546.89 acres. We completed our acquisition on September 5, 2007 by paying to Desert Mining, Inc. an aggregate of $821,798.45.

With current well spacing regulations, we believe we can drill up to 37 wells on this acreage. The Jonah Field and the Pinedale Anticline are acknowledged as the premier gas fields in the Rocky Mountains. These fields are located in Wyoming's Greater Green River Basin. On December 27, 2007, we engaged Schlumberger to conduct a reserve analysis and target drilling program on our Jonah Prospect On April 7, 2008, we announced that we acquired a minority joint venture interest in three-well prospect in the West Gomez Field within Peco County, Texas.

Since we are an exploration stage company, there is no assurance that commercially viable resources or reserves exist on any of our properties, and a great deal of further exploration will be required before a final evaluation as to the economic and legal feasibility for our future exploration is determined. To date, except for the Sturgeon 1-11 and Cunningham 1-2 wells of which we own a 1.5% overriding royalty interest, we have not discovered an economically viable resource or reserve on any of our properties, and there is no assurance that we will discover one.

The exploration and development of oil and gas properties is subject to various United States federal, state and local governmental regulations. Our company may from time to time, be required to obtain licenses and permits from various governmental authorities in regards to the exploration of our property interests.

If we proceed with the development of our future properties, we anticipate that we will be subject to increased governmental regulation. Matters subject to regulation include discharge permits for drilling operations, drilling and abandonment bonds, reports concerning operations, the spacing of wells, and pooling of properties and taxation. From time to time, regulatory agencies have imposed price controls and limitations on production by restricting the rate of flow of oil and gas wells below actual production capacity in order to conserve supplies of oil and gas. The production, handling, storage, transportation and disposal of oil and gas, by-products thereof, and other substances and materials produced or used in connection with oil and gas operations are also subject to regulation under federal, state, provincial and local laws and regulations relating primarily to the protection of human health and the environment. As we have not proceeded to the development of our future properties, we have not incurred any expenditures related to complying with such laws, or for remediation of existing environmental contamination. The requirements imposed by such laws and regulations are frequently changed and subject to interpretation, and we are unable to predict the ultimate cost of compliance with these requirements or their effect on our operations.

We have no employees as of the date of this annual report other than our Chief Executive Officer, Lewis Dillman, and our sole director and Chief Financial Officer, George Drazenovic, who provide us with their services through consulting agreements.

We have not incurred any other research or development expenditures since our incorporation.

Our wholly-owned subsidiaries are Sun Cal Energy Corp., a Nevada corporation and Sun Cal Energy Canada Corp., a British Columbia corporation.

Shares of our common stock are speculative, especially since we are in the exploration-stage of our new business. We operate in a volatile sector of business that involves numerous risks and uncertainties. The risks and uncertainties described below are not the only ones we face. Other risks and uncertainties, including those that we do not currently consider material, may impair our business. If any of the risks discussed below actually occur, our business, financial condition, operating results or cash flows could be materially adversely affected. This could cause the trading price of our securities to decline, and you may lose all or part of your investment. Prospective investors should consider carefully the risk factors set out below.

As our properties are in the exploration stage there can be no assurance that we will establish commercial discoveries on our properties.

Exploration for economic reserves of oil and gas is subject to a number of risk factors. While the rewards to an investor can be substantial if an economically viable discovery is made, few of the properties that are explored are ultimately developed into producing oil and/or gas wells. Our properties are in the exploration stage only and are without proven reserves of oil and gas. There can be no assurance that we will establish commercial discoveries on any of our properties.

The potential profitability of oil and gas ventures depends upon factors beyond the control of our company

The potential profitability of oil and gas properties is dependent upon many factors beyond our control. For instance, world prices and markets for oil and gas are unpredictable, highly volatile, potentially subject to governmental fixing, pegging, controls, or any combination of these and other factors, and respond to changes in domestic, international, political, social, and economic environments. Additionally, due to world-wide economic uncertainty, the availability and cost of funds for production and other expenses have become increasingly difficult, if not impossible, to project. These changes and events may materially affect our financial performance.

Adverse weather conditions can also hinder drilling operations. A productive well may become uneconomic in the event water or other deleterious substances are encountered which impair or prevent the production of oil and/or gas from the well. In addition, production from any well may be unmarketable if it is impregnated with water or other deleterious substances. The marketability of oil and gas which may be acquired or discovered will be affected by numerous factors beyond our control. These factors include the proximity and capacity of oil and gas pipelines and processing equipment, market fluctuations of prices, taxes, royalties, land tenure, allowable production and

environmental protection. The extent of these factors cannot be accurately predicted but the combination of these factors may result in our company not receiving an adequate return on invested capital.

Competition in the oil and gas industry is highly competitive and there is no assurance that we will be successful in acquiring interests in oil and gas properties.

The oil and gas industry is intensely competitive. We compete with numerous individuals and companies, including many major oil and gas companies, which have substantially greater technical, financial and operational resources and staffs. Accordingly, there is a high degree of competition for desirable oil and gas properties for drilling operations and necessary drilling equipment, as well as for access to funds. There can be no assurance that the necessary funds can be raised or that any projected work will be completed.

The marketability of natural resources will be affected by numerous factors beyond our control which may result in us not receiving an adequate return on invested capital to be profitable or viable.

The marketability of natural resources which may be acquired or discovered by us will be affected by numerous factors beyond our control. These factors include market fluctuations in oil and gas pricing and demand, the proximity and capacity of natural resource markets and processing equipment, governmental regulations, land tenure, land use, regulation concerning the importing and exporting of oil and gas and environmental protection regulations. The exact effect of these factors cannot be accurately predicted, but the combination of these factors may result in us not receiving an adequate return on invested capital to be profitable or viable.

Oil and gas operations are subject to comprehensive regulation which may cause substantial delays or require capital outlays in excess of those anticipated causing an adverse effect on our company.

Oil and gas operations are subject to federal and local laws relating to the protection of the environment, including laws regulating removal of natural resources from the ground and the discharge of materials into the environment. Oil and gas operations are also subject to federal and local laws and regulations which seek to maintain health and safety standards by regulating the design and use of drilling methods and equipment. Various permits from government bodies are required for drilling operations to be conducted; no assurance can be given that such permits will be received. No assurance can be given that environmental standards imposed by federal or local authorities will not be changed or that any such changes would not have material adverse effects on our activities. Moreover, compliance with such laws may cause substantial delays or require capital outlays in excess of those anticipated, thus causing an adverse effect on us. Additionally, we may be subject to liability for pollution or other environmental damages which it may elect not to insure against due to prohibitive premium costs and other reasons.

Exploration and production activities are subject to certain environmental regulations which may prevent or delay the commencement or continuance of our operations.

In general, our exploration and production activities are subject to certain federal and local laws and regulations relating to environmental quality and pollution control. Such laws and regulations increase the costs of these activities and may prevent or delay the commencement or continuance of a given operation. Compliance with these laws and regulations has not had a material effect on our operations or financial condition to date. Specifically, we are subject to legislation regarding emissions into the environment, water discharges and storage and disposition of hazardous wastes. In addition, legislation has been enacted which requires well and facility sites to be abandoned and reclaimed to the satisfaction of state authorities. However, such laws and regulations are frequently changed and we are unable to predict the ultimate cost of compliance. Generally, environmental requirements do not appear to affect us any differently or to any greater or lesser extent than other companies in the industry. We believe that our operations comply, in all material respects, with all applicable environmental regulations.

Because some of our property interests are still registered under the names of other entities, our title to these property interests may be serious affected if formal assignments of these property interest to under our name are not registered in due course.

Some of our property interests, such as our working interest in the Lokern lease and the Britlind Prospect leases were originally acquired under the name of third parties. Assignment of leasehold out of the third parties are to be made in due course. However, if formal assignments of these property interests are not registered under our name in due course, we face seriously risks to our title to these property interests and may even lose our title to these property interests.

Our future is dependent upon our ability to obtain financing. If we do not obtain such financing, we may have to cease our exploration activities and investors could lose their entire investment.

There is no assurance that we will operate profitably or will generate positive cash flow in the future. We will require additional financing in order to proceed beyond the first few months of our exploration program. We will also require additional financing for the fees we must pay to maintain our status in relation to the rights to our properties and to pay the fees and expenses necessary to become and operate as a public company. We will also need more funds if the costs of the exploration of our oil and gas properties are greater than we have anticipated. We will also require additional financing to sustain our business operations if we are not successful in earning revenues. We currently do not have any arrangements for further financing and we may not be able to obtain financing on commercially reasonable terms or terms that are acceptable to us when it is required. Our future is dependent upon our ability to obtain financing. If we do not obtain such financing, our business could fail and investors could lose their entire investment.

Because we may never earn revenues from our operations, our business may fail and then investors may lose all of their investment in our company.

We have only recently accrued revenues and have experienced losses since inception. We have yet to generate positive earnings and there can be no assurance that we will ever operate profitably. Our company has a limited operating history and is in the exploration stage. The success of our company is significantly dependent on the uncertain events of the discovery and exploitation of oil and gas reserves on our properties or selling the rights to exploit those oil and gas reserves. If our business plan is not successful and we are not able to operate profitably, then our stock may become worthless and investors may lose all of their investment in our company.

Prior to completion of our exploration stage, we anticipate that we will incur increased operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from the exploration of our oil and gas properties in the future, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide no assurance that we will generate any revenues or ever achieve profitability. If we are unsuccessful in addressing these risks, our business will fail and investors may lose all of their investment in our company.

We have no employees other than our Chief Executive Officer, Lewis Dillman, and our sole director and Chief Financial Officer, George Drazenovic.

Our Chief Executive Officer, Lewis Dillman, and our Chief Financial Officer and director, George Drazenovic, will be the only persons responsible for our managerial responsibilities. As such, they will have ultimate authority with respect to our business decisions, our disclosure and our implementation of accounting controls and procedures. If Messrs. Dillman and Drazenovic are unable to properly institution such procedures and comply with reporting obligation requirements, our operations may be adversely impacted.

Our By-laws contain provisions indemnifying our officers and directors against all costs, charges and expenses incurred by them

Our By-laws contain provisions with respect to the indemnification of our officers and directors against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, actually and reasonably incurred by him, including an amount paid to settle an action or satisfy a judgment in a civil, criminal or administrative action or proceeding to which he is made a party by reason of his being or having been one of our directors or officers.

Investors' interests in our company will be diluted and investors may suffer dilution in their net book value per share if we issue additional shares or raise funds through the sale of equity securities

Our constating documents authorize the issuance of 750,000,000 shares of common stock with a par value of $0.001. In the event that we are required to issue any additional shares or enter into private placements to raise financing through the sale of equity securities, investors' interests in our company will be diluted and investors may suffer dilution in their net book value per share depending on the price at which such securities are sold. If we issue any such additional shares, such issuances also will cause a reduction in the proportionate ownership and voting power of all other shareholders. Further, any such issuance may result in a change in our control.

Our By-laws do not contain anti-takeover provisions which could result in a change of our management and directors if there is a take-over of our company

We do not currently have a shareholder rights plan or any anti-takeover provisions in our By-laws. Without any anti-takeover provisions, there is no deterrent for a take-over of our company, which may result in a change in our management and directors.

As a result of our sole director and officer being resident of other countries other than the United States, investors may find it difficult to enforce, within the United States, any judgments obtained against our company or our director and officer

We do not currently maintain a permanent place of business within the United States. In addition, our current sole director and officer is a national and resident of a country other than the United States, and all or a substantial portion of such person's assets are located outside the United States. As a result, it may be difficult for investors to enforce within the United States any judgments obtained against our company or our director and officer, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof.

We do not intend to pay dividends on any investment in the shares of stock of our company.

We have never paid any cash dividends and currently do not intend to pay any dividends for the foreseeable future. To the extent that we require additional funding currently not provided for in our financing plan, our funding sources may prohibit the payment of a dividend. Because we do not intend to declare dividends, any gain on an investment in our company will need to come through an increase in the stock’s price. This may never happen and investors may lose all of their investment in our company.

Our stock is a penny stock. Trading of our stock may be restricted by the SEC's penny stock regulations which may limit a stockholder's ability to buy and sell our stock.

Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines “penny stock” to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and “accredited investors”. The term “accredited investor” refers generally to institutions with

assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standard risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

FINRA sales practice requirements may also limit a stockholder's ability to buy and sell our stock.

In addition to the "penny stock" rules described above, the Financial Industry Regulatory Authority (FINRA) has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Trading in our common stock on the OTC Bulletin Board is limited and sporadic making it difficult for our shareholders to sell their shares or liquidate their investments.

Shares of our common stock are currently quoted on the OTC Bulletin Board. The trading price of our common stock has been subject to wide fluctuations. Trading prices of our common stock may fluctuate in response to a number of factors, many of which will be beyond our control. The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with no current business operation. There can be no assurance that trading prices and price earnings ratios previously experienced by our common stock will be matched or maintained. These broad market and industry factors may adversely affect the market price of our common stock, regardless of our operating performance.

In the past, following periods of volatility in the market price of a company's securities, securities class-action litigation has often been instituted. Such litigation, if instituted, could result in substantial costs for us and a diversion of management's attention and resources.

Our registered statutory office is located at Empire Stock Transfer Inc., 2470 Saint Rose Pkwy, Suite 304, Henderson, NV 89074.

Our business office is located at, Suite 700, 205 - 5th Avenue, S.W., Calgary, Alberta T2P 2V7 Canada.

In October 2006, Sun Cal Energy Corp. entered into two agreements: an agreement with TriMar Energy Partners, Inc. to acquire an one and one half percent (1.5%) of 8/8ths overriding royalty interest in an oil and gas lease known

as the Hobart Lease and an agreement with Western Energy Capital, LLC. to acquire an undivided 45% interest in certain oil and gas leases known as the Lokern Leases.

On April 19, 2007, we entered into an agreement with Western Energy Capital, LLC (“Western”) to acquire a partial interest in the “Britlind” Prospect and leases situated in the prolific Breton Sound area, offshore Louisiana. In April and May of 2007, we paid an aggregate of $640,000 to Western Energy Capital, LLC pursuant to the agreement for a 5% working interest in the Britlind Prospect lease interests, seismic data, hardware and software and ongoing rights to an area of mutual interest.

On August 15, 2007, we entered into an agreement with Desert Mining, Inc. to acquire a 100% working interest in 6,000 acres of leases in the Jonah Field region of Wyoming. Our Jonah Prospects are identified as South Jonah, which consists of 2,477.68 acres and West Jonah, consisting of 3,546.89 acres.

No matters were submitted to a vote of security holders that have not been previously disclosed.

Our shares of common stock are quoted for trading on the OTC Bulletin Board under the symbol SCEY.OB.

The following table sets forth the average high and the low bid quotations quarterly for our shares of common stock during the last two fiscal years ended June 30, 2007 and 2008. The closing bid on September 15, 2008 is also shown. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not represent actual transactions.

Period		High		Low		Close
2008
4th Quarter April 1, 2008 – June 30, 2008	$	0.43	$	0.39	$	0.41
3rd Quarter January 1, 2008 – June 30, 2008	$	0.64	$	0.55	$	0.60
2nd Quarter October 1, 2007 – December 31, 2007	$	0.71	$	0.63	$	0.67
1st Quarter July 1, 2007 – September 30, 2007	$	2.27	$	2.09	$	2.17
2007
4th Quarter April 1, 2007 – June 30, 2007	$	2.60	$	2.40	$	2.51
3rd Quarter January 1, 2007 – June 30, 2007	$	1.69	$	1.60	$	1.64
2nd Quarter October 1, 2006 – December 31, 2006	$	0.20	$	0.20	$	0.20
1st Quarter July 1, 2006 – September 30, 2006	$	0.00	$	0.00	$	0.00

There are approximately 47 holders of record of our common stock as at September 15, 2008.

There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:

1. We would not be able to pay our debts as they become due in the usual course of business; or

2. Our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of Shareholders who have preferential rights superior to those receiving the distribution.

We have not declared any dividends, and we do not plan to declare any dividends in the foreseeable future.

On April 16, 2007, we closed a private placement consisting of 200,000 units of our securities (the “Units”) at a price of US $1.00 per Unit for aggregate proceeds of $200,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant”), each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $1.50 per Warrant Share until April 16, 2010. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On May 1, 2007, we closed a private placement consisting of 700,000 units of our securities (the “Units”) at a price of US $1.00 per Unit for aggregate proceeds of $700,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant”), each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $1.50 per Warrant Share until April 16, 2010. We issued the Units to a non-U.S. person (as that term is

defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On June 14, 2007, we closed a private placement consisting of 150,000 units of our securities (the “Units”) at a price of US $2.00 per Unit for aggregate proceeds of $300,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant”), each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $2.50 per Warrant Share until May 1, 2010. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On June 29, 2007, we closed a private placement consisting of 80,000 units of our securities (the “Units”) at a price of US $2.50 per Unit for aggregate proceeds of $200,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant”), each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $3.00 per Warrant Share until June 29, 2010. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On July 27, 2007, we issued 100,000 units of our securities (the “Units”) at a price of US $2.50 per Unit for proceeds of $250,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant’), each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $3.00 per Warrant Share until July 27, 2010. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On August 29, 2007, we issued 500,000 units of our securities (the “Units”) at a price of US $1.20 per Unit for proceeds of $600,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant’). , each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $1.60 per Warrant Share until August 29, 2010. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On September 24, 2007, we issued 833,333 units of its securities (the “Units”) at a price of US $1.20 per Unit for proceeds of $1,000,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant’)., each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $1.60 per Warrant Share until September 24, 2010. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On May 24, 2008, we issued 333,333 units of its securities (the “Units”) at a price of US $0.30 per Unit for proceeds of $100,000. Each Unit consists of one common share and one share purchase warrant (a “Warrant’)., each Warrant shall be exercisable into one common share (a “Warrant Share”) at a price of US $0.50 per Warrant Share until May 24, 2011. We issued the Units to a non-U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

The following discussion should be read in conjunction with our financial statements and the related notes included herein. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this current report, particularly in the section entitled “Risk Factors” in this annual report.

Our financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

We have accrued a small amount of revenues and have experienced losses since inception. Our plan of operations for the next 12 months involves the exploration of oil and gas properties held by our company and our subsidiary, Sun Cal Energy Corp.

As provided under the agreement with Western Energy Capital, LLC on the Lokern Leases, we will be a joint working interest owner together with Western Energy Capital, LLC for the Lokern Leases, and will be required to pay our proportionate share of all land, title, lease bonuses and drilling costs. In addition to the exploration activities on the oil and gas properties under the two agreements held by Sun Cal Energy Corp., we will be required to pay our proportionate share of all land, title, lease bonuses and drilling costs for other properties in which we hold a working interest such as the Britlind Prospect Leases and the Jonah Prospects. Furthermore, we will continue to seek opportunities to acquire other oil and gas properties of merit. As we are still in exploration stage, we anticipate that we will incur increased operating expenses while realizing little or no revenues. We anticipate that we will expend approximately $360,000 in the next 12 months for our operating expenses. We therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from the exploration of our oil and gas properties in the future, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide no assurance that we will generate any revenues or ever achieve profitability.

We will also need more funds if the costs of the exploration of our oil and gas properties are greater than we have anticipated. We will also require additional financing to sustain our business operations if we are not successful in earning revenues. We currently do not have any arrangements for further financing and we may not be able to obtain financing on commercially reasonable terms or terms that are acceptable to us when it is required. We anticipate spending approximately $4,000 in ongoing general and administrative expenses per month for the next 12 months, for a total anticipated expenditure of $48,000 over the next 12 months. The general and administrative expenses for the year will consist primarily of professional fees for the audit and legal work relating to our regulatory filings throughout the year, as well as transfer agent fees, annual mineral claim fees and general office expenses.

During the next twelve month period, we anticipate that we will generate little or no revenues. Accordingly, we will be required to obtain additional financing in order to continue our plan of operations. We believe that debt financing will not be an alternative for funding additional phases of exploration as we do not have tangible assets to secure any debt financing. We anticipate that additional funding will be in the form of equity financing from the sale of our common stock or through shareholder or related party loans. However, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our exploration programs. In the absence of such financing, we will not be able to continue exploration of our properties and our business plan will fail. Even if we are successful in obtaining equity financing to fund our exploration program, there is no assurance that we will obtain the funding necessary to pursue any advanced exploration of our properties. If we do not continue to obtain additional financing, we will be forced to abandon our properties and our plan of operations

We are an exploration stage company that from inception to June 30, 2008 has only accrued revenues in the amount of $139,441. Our revenues during the year ended June 30, 2008 were derived primarily from royalty payments from properties in which we have an interest. Certain of our royalty payments owed to us by Marathon Oil pursuant to certain agreements, have been held back by Marathon Oil because it has received correspondence from third parties asserting an interest over 0.4% of our overriding royalty interest. We are confident that we will be able to resolve this issue soon and the withheld payment will be paid to us in the near future.

Our operating expenses for the year ended June 30, 2008 and 2007 are outlined in the table below:

We anticipate continuing to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing shareholders. There is no assurance that we will achieve any of additional sales of our equity securities or arrange for debt or other financing to fund our exploration and development activities.

Since we are an exploration stage company, there is no assurance that commercially viable resources or reserves exist on any of our properties, and a great deal of further exploration will be required before a final evaluation as to the economic and legal feasibility for our future exploration is determined. To date, we have not discovered an economically viable resource or reserve on any of our properties, and there is no assurance that we will discover one.

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

The preparation of financial statements in conformity with United States generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amount 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. Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain. Presented below is a description of the accounting policies that are most critical to an understanding of our financial statements.

Revenue is recognized in accordance with Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements,” as revised by SAB No. 104. As such, revenue is recognized when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable and collectability is probable. Sales are recorded net of sales discounts.

The Company accounts for stock-based compensation under SFAS No. 123R, "Share- based Payment” " and SFAS No. 148, "Accounting for Stock-Based Compensation--Transition and Disclosure--An amendment to SFAS No. 123." These standards define a fair value based method of accounting for stock-based compensation. In accordance with SFAS Nos. 123R and 148, the cost of stock-based employee compensation is measured at the grant date based on the value of the award and is recognized over the vesting period. The value of the stock-based award is determined using the Black-Scholes option-pricing model, whereby compensation cost is the excess of the fair value of the award as determined by the pricing model at the grant date or other measurement date over the amount an employee must pay to acquire the stock. The resulting amount is charged to expense on the straight-line basis over the period in which we expect to receive the benefit, which is generally the vesting period.

All issuances of the Company’s stock for non-cash consideration have been assigned a per share amount equaling either the market value of the shares issued or the value of consideration received, whichever is more readily determinable. The majority of the non-cash consideration received pertains to services rendered by consultants and others and has been valued at the market value of the shares on the dates issued.

The provisions of SFAS No. 128, “Earnings Per Share” (“EPS”) have been adopted. SFAS No. 128 provides for the calculation of basic and diluted earnings per share. Basic EPS includes no dilution and is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution of securities that could share in the earnings or losses of the entity, arising from the exercise of options and warrants and the conversion of convertible debt.

The Company’s financial instruments consist of cash and cash equivalents, accounts payable, and notes payable. Pursuant to SFAS No. 107, “Disclosures About Fair Value of Financial Instruments,” Management is required to estimate the fair value of all financial instruments at the balance sheet date. The carrying values of our financial instruments in the financial statements are considered in order to approximate their fair values due to the short -term nature of the instruments.

Sun Cal Energy, Inc.
(Formerly Host Ventures, Inc. )
(An Exploratory Stage Company)
Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Sun Cal Energy, Inc. (the “Company”) as of June 30, 2007 and 2008, and the related consolidated statements of operations, stockholders’ equity and cash flows for the two years then ended and for the period from inception (July 20, 2004) through June 30, 2008. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Sun Cal Energy, Inc. as of June 30, 2007 and 2008, and the results of its operations and its cash flows for the two years then ended and for the period from inception (July 20, 2004) through June 30, 2008 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has incurred recurring losses and has yet to be successful in establishing profitable operations. These factors, among others, raise substantial doubt about its ability to continue as a going concern. Management’s plans regarding those matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Sun Cal Energy, Inc.
(An Exploratory Stage Company)
Consolidated Balance Sheets

Sun Cal Energy, Inc.
(An Exploratory Stage Company)
Consolidated Statements of Operations

Sun Cal Energy, Inc.
(Formerly Host Ventures Inc)
(An Exploratory Stage Company)
Statements of Consolidated Stockholders' Equity

Sun Cal Energy, Inc.
(An Exploratory Stage Company)
Consolidated Statements of Cash Flows

In October 2007, the Company issued a total of 300,000 shares of its common stock to three members of its advisory board which were valued at $321,000. The $321,000 was charged to operations and included in consulting fees.

During the year ended June 30, 2007, the Company issued 3,800,000 shares of its common stock in connection with the purchase of its oil and gas properties. These shares were valued at $1 per share.

Sun Cal Energy, Inc. (the “Company”), was incorporated in the State of Nevada on July 20, 2004 under the name Host Ventures, Inc. On November 6, 2006, the Company changed its name to Sun Cal Energy, Inc. The Company is in the exploratory stage, as defined in Statement of Financial Accounting Standards (“SFAS”) No. 7, “ Accounting and Reporting by Development Stage Enterprises,” with its principal activity being the exploration and development of oil and gas properties.

Effective March 12, 2007, the Company acquired all of the outstanding shares of Sun Cal Energy Corporation (“SCEC”) in exchange for issuing 26,925,000 of its common stock. SCEC was incorporated in the state of Nevada on June 2, 2006. As of the date of the acquisition, both companies were under common control, and therefore for financial reporting purposes, the acquisition is treated as if it occurred on July 1, 2006. Assets acquired from SCEC were recorded at their historical cost bases on July 1, 2006 and the financial statements included herein combine the activities of both companies since July 1, 2006.

The accompanying financial statements include the accounts and transactions of the Company and its wholly owned subsidiary, Sun Cal Energy Corporation, and have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has no established source of material revenue, has incurred a net loss for the year ended June 30, 2008 of $1,366,148 and has an accumulated deficit since its inception of $2,070,181. These conditions raise substantial doubt as to the Company's ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainty. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management recognizes that the Company must generate additional resources to enable it to continue operations. Management intends to raise additional funds through debt and/or equity financing or through other means that it deems necessary. However, no assurance can be given that the Company will be successful in raising additional capital. Further, even if the company raises additional capital, there can be no assurance that the Company will achieve profitability or positive cash flow. If management is unable to raise additional capital and expected significant revenues do not result in positive cash flow, the Company will not be able to meet its obligations and may have to cease operations.

Effective November 6, 2006, the Company authorized a 10-for-1 stock split. All references in the accompanying financial statements to the number of shares outstanding and per-share amounts have been restated to reflect the indicated stock split.

The accompanying financial statements include the accounts and transactions of Sun Cal Energy, Inc. and its subsidiary. Intercompany transactions and balances have been eliminated in consolidation.

The Company accounts for stock-based compensation under SFAS No. 123R, "Share- based Payment” and SFAS No. 148, "Accounting for Stock-Based Compensation--Transition and Disclosure--An amendment to SFAS No. 123." These standards define a fair value based method of accounting for stock-based compensation. In accordance with SFAS No’s. 123R and 148, the cost of stock-based employee compensation is measured at the grant date based on the value of the award and is recognized over the vesting period. The value of the stock-based award is determined using the Black-Scholes option-pricing model, whereby compensation cost is the excess of the fair value of the award as determined by the pricing model at the grant date or other measurement date over the amount an employee must pay to acquire the stock. The resulting amount is charged to expense on the straight-line basis over the period in which the Company expects to receive the benefit, which is generally the vesting period. During the year ended June 30, 2008, the Company recognized no compensation expense under SFAS No. 123R as no stock based compensation were issued to employees during the period.

All issuances of the Company's stock for non-cash consideration have been assigned a per share amount equaling either the market value of the shares issued or the value of consideration received, whichever is more readily determinable. The majority of the non-cash consideration received pertains to services rendered by consultants and others and has been valued at the market value of the shares on the dates issued. During the year ended June 30, 2007, the Company recognized $25,000 in non-cash compensation from the issuance of 25,000 shares of its common stock to a consultant. During the year ended June 30, 2008, the Company recognized $321,000 in non-cash compensation from the issuance of 300,000 shares of its common stock in total to three consultants.

The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of EITF 96-18, “Accounting for Equity Instruments That are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services” and EITF 00-18, “Accounting Recognition for Certain Transactions Involving Equity Instruments Granted to Other Than Employees.” The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to

consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement. In accordance with EITF 00-18, an asset acquired in exchange for the issuance of fully vested, nonforfeitable equity instruments should not be presented or classified as an offset to equity on the grantor's balance sheet once the equity instrument is granted for accounting purposes. Accordingly, the Company records the fair value of the fully vested non-forfeitable common stock issued for future consulting services as prepaid services in its consolidated balance sheet.

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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates.

The Company’s financial instruments consist of cash and cash equivalents, accounts payable, accrued expenses and notes payable, Pursuant to SFAS No. 107, “Disclosures About Fair Value of Financial Instruments,” the Company is required to estimate the fair value of all financial instruments at the balance sheet date. The Company considers the carrying values of its financial instruments in the financial statements to approximate their fair values.

For purposes of the statements of cash flows, the Company defines cash equivalents as all highly liquid debt instruments purchased with a maturity of three months or less, plus all certificates of deposit.

Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the related assets. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Expenditures for maintenance and repairs are charged to operations as incurred; additions, renewals and betterments are capitalized.

The Company accounts for its long-lived assets in accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS No. 144 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset's carrying value and fair value or disposable value. As of June 30, 2008, the Company did not deem any of its long-term assets to be impaired.

Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash. Currently, the Company maintains its cash in bank accounts which are not insured.

The Company recognizes revenue in accordance with Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements,” as revised by SAB No. 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable and collectibility is probable. Sales are recorded net of sales discounts. For the year ended June 30, 2007, the Company did not generate any revenue. For the year ended June 30, 2008, the Company generated $139,441 from its ownership of overriding royalties which it owns in the Centurion and Hobart Properties as discussed in Note 3.

The Company follows the full cost method of accounting for crude oil and natural gas properties. Under this method, all direct costs and certain indirect costs associated with acquisition of properties and successful as well as unsuccessful exploration and development activities are capitalized. Depreciation, depletion, and amortization of capitalized crude oil and natural gas properties and estimated future development costs, excluding unproved properties, are based on the unit-of-production method based on proved reserves.

Under FASB Emerging Issues Task Force Statement 00-2, Accounting for Web Site Development Costs ("EITF 00-2"), costs and expenses incurred during the planning and operating stages of the Company's web site development are expensed as incurred. Under EITF 00-2, costs incurred in the web site application and infrastructure development stages are capitalized by the Company and amortized to expense over the web site's estimated useful life or period of benefit. As of June 30, 2007 and 2008, the Company had net capitalized costs of $11,913 and $7,463, respectively, related to its web site development, The development costs are being depreciated on a straight-line basis over an estimated useful life of 3 years.

Website cost and accumulated depreciation as of June 30, 2007, and 2008 are as follows:

Amortization expense for the years ended June 30, 2007 and 2008 amounted to $1,436 and $4,450, respectively.

A schedule of amortization expense for the two years ending June 30, 2010 is a follows:

The Company accounts for income taxes under the provisions of SFAS No. 109, “Accounting for Income Taxes.” Under SFAS No. 109, deferred tax assets and liabilities are recognized for future tax benefits or consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that the asset will not be realized through future operations.

The Company has total net operating tax loss carry forwards at June 30, 2008 of approximately $2,071,000 for federal income tax purposes. These net operating losses have generated a deferred tax asset of approximately $704,000 on which a valuation allowance equaling the total tax benefit has been provided due to the uncertain nature of it being realized. Net operating loss carryforwards expire in various years through June 30, 2028 for federal tax purposes.

The Company reports earnings (loss) per share in accordance with SFAS No. 128, "Earnings per Share." Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Diluted earnings (loss) per share as not been presented since the effect of the assumed conversion of warrants to purchase common shares would have an anti-dilutive effect. The only potential common shares were warrants totaling 2,255,000, and 4,021,666, as of June 30, 2007 and 2008, respectively, that have been excluded from the computation of diluted net loss per share because the effect would have been anti-dilutive. If such shares were included in diluted EPS, they would have resulted in weighted-average common shares of 76,496,137 and 86,536,001 for the years ended June 30, 2007 and 2008, respectively.

FAS 157, Fair Value Measurements. In September, 2007, the FASB issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements ("SFAS 157"). SFAS 157 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. We are currently assessing the impact that SFAS 157 will have on our results of operations and financial position.

SFAS 159, "The Fair Value Option for Financial Assets and Financial Liabilities—Including an Amendment of FASB Statement No. 115." In November 2007, the FASB issued Statement of

Financial Accounting Standards No. 159, The Fair Value Option for Financial Assets and Financial Liabilities—Including an Amendment of FASB Statement No. 115 ("SFAS 159"). SFAS 159 is effective for fiscal years beginning after November 15, 2007. SFAS 159 permits an entity to choose to measure many financial instruments and certain other items at fair value at specified election dates. Subsequent unrealized gains and losses on items for which the fair value option has been elected will be reported in earnings. We do not believe that the adoption of SFAS 159 will have a material impact on our consolidated financial statements.

SFAS 141, "Business Combinations." In November 2007, the FASB issued SFAS No. 141 (revised 2007), Business Combination (FAS 141(R)) and SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51 (FAS 160). FAS 141(R) will change how business acquisitions are accounted for and will impact financial statements both on the acquisition date and in subsequent periods. FAS 160 will change the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests and classified as a component of equity. FAS 141(R) and FAS 160 are effective for both public and private companies for fiscal years beginning on or after December 15, 2008 (fiscal 2010 for the Company). FAS 141(R) will be applied prospectively. FAS 160 requires retroactive adoption of the presentation and disclosure requirements for existing minority interests. All other requirements of FAS 160 will be applied prospectively. Early adoption is prohibited for both standards. We do not believe that the adoption of SFAS 141® or FAS 160 will have a material impact on our consolidated financial statements.

SFAS No. 161 - In March 2008, the FASB issued Statement No. 161, Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133. This Statement changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows.

This Statement is intended to enhance the current disclosure framework in Statement 133. The Statement requires that objectives for using derivative instruments be disclosed in terms of underlying risk and accounting designation. This disclosure better conveys the purpose of derivative use in terms of the risks that the entity is intending to manage. Disclosing the fair values of derivative instruments and their gains and losses in a tabular format should provide a more complete picture of the location in an entity’s financial statements of both the derivative positions existing at period end and the effect of using derivatives during the reporting period. Disclosing information about credit-risk-related contingent features should provide information on the potential effect on an entity’s liquidity from using derivatives. Finally, this Statement requires cross-referencing within the footnotes, which should help users of financial statements locate important information about derivative instruments.

This Statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. This Statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption.

The Company is currently evaluating SFAS 161 and has not yet determined its potential impact on its future results of operations or financial position.

On October 18, 2006, the Company entered into an agreement to purchase 1.5% of an overriding royalty in the City of Hobart lease located in Oklahoma for $525,000 and 1,500,000 shares of its common stock. Under the terms of the agreement, $375,000 was paid and 1,500,000 shares of the Company’s common stock were issued in October 2006, and the remaining $150,000 was paid in January 2007. The Seller has agreed to drill a second well on the leased property in consideration for an additional 1,000,000 shares of the Company’s common stock. The Company valued the 1,500,000 shares at $1.00 per share based upon the share price being offered in its private offerings.

On October 4, 2006, the Company entered into an agreement to purchase a 45% undivided interest in 45 separate leases known as the Lokern in addition to any leases taken in the prospect area. The Lokern leases are located in California. The Company purchased its interest for $125,000 and 1,300,000 shares of common stock. The $125,000 was paid and 1,300,000 shares were issued in October 2006. Under the terms of the purchase, the Company will receive 75% of the net revenue produced by wells located on the leased properties. In addition, the Company is responsible for its allocated share of all costs associated with the leased properties including, but not limited to land, title, lease bonuses, and drilling. The Company valued the 1,300,000 shares at $1.00 per share based upon the share price being offered in its private offerings.

On April 19, 2007, the Company entered into an agreement to acquire a 5% working interest in certain leases and to receive certain rights and privileges to approximately 9,440 acres of State of Louisiana leases. Along with the leases and 3d seismic data relating to the Prospect, the acquisition included ongoing rights to a larger Area of Mutual Interest. Under the terms of the purchase, the Company will receive 3.5% of the net revenue produced by wells located on the leased properties. In addition, the Company is responsible for its allocated share of all costs associated with the leased properties including, but not limited to land, title, lease bonuses, and drilling. The purchase price of these leases is $640,000 in cash and 400,000 shares of the Company’s common stock. The Company valued the 400,000 shares at $1.00 per share based upon the share price being offered in its private offerings.

On August 15, 2007, the Company entered into an agreement with Desert Mining, Inc. to acquire a 100% working interest in 6,000 acres of leases in the Jonah Field region of Wyoming. The Jonah Prospects are identified as South Jonah, which consists of 2,477.68 acres and West Jonah, consisting of 3,546.89 acres. The acquisition was completed on September 5, 2007 by paying to Desert Mining, Inc. an aggregate of $821,799.

On October 1, 2007, the Company entered into an agreement to purchase a 5% overriding royalty interest on certain leases to be acquired by seller located in the States of Alabama, Louisiana, Mississippi, Oklahoma, and Texas, known as the ”Centurion Properties”. The purchase price of the royalty interest is $275,000. If the seller does not acquire the royalty interest on the properties defined in the agreement, the Company has the right to have the funds paid refunded or to have the funds applied to other offering of the seller.

On October 24, 2007, the Company signed a Letter of Intent to acquire a 100% working interest in 8,695 acres of leases in the Cherokee and Forest City Basins of Kansas. The Letter of Intent was set to expire on October 31, 2007 but the Company is currently negotiating an extension of the Letter of Intent with the counter party. The purchase price paid by the Company would include (a) an upfront payment of $500,000; (b) the issuance of 6,916,667 shares of common

stock to the seller; (c) the granting of a 5% overriding royalty to the seller on the Kansas assets; and (d) the assumption of $1,200,000 of the seller’s existing debt on the properties. Further, the Company would agree to initiate plans to provide $2,000,000 in work over costs to develop the properties within 6 months of the closing date. The Company is currently working to close on mezzanine financing for $2,000,000 within 60 days of the closing date of the purchase. If the Company does not initiate plans to provide $2,000,000 in work over costs within the 6 months of the closing date, the seller will retain a 12.5% overriding royalty on the Kansas assets until the $2,000,000 work over begins.

On March 21, 2008, the Company acquired a 2% joint venture interest in the 83 & 84 Project JV located in West Texas.

As of June 30, 2008, the Company has not commenced the development of any its oil and gas leased properties. However, during the year ended June 30, 2008, the Company generated $139,441 from its ownership of overriding royalties which it owns in the Centurion and Hobart Properties. The Company’s allocated share of production sold during the year ended June 30, 2007 amounted to 46 barrels of oil and 20,878 MCF of gas.

The Company is authorized to issue 750,000,000 shares of common stock. Each shareholder of common is entitled to one vote. As indicated, the accompanying financial statements include the combined activity of Sun Cal Energy Inc. (“the Company”) and its wholly owned subsidiary, Sun Cal Energy Corporation (“SCEC”) from the inception of both companies. Common stock activities for both companies since inception, taking into account the Company’s 10-for-1 stock split of November 6, 2006, are as follows:

On December 15, 2004, the Company issued 20,000,000 (2,000,000 pre-split) shares of its common stock to its founders for $2,000.

In January and February 2005, the Company issued 28,250,000 (2,825,000 pre-split) shares of its common stock for $28,250.

In March 2005, the Company issued 3,000,000 (300,000 pre-split) shares of its common stock for $15, 000.

In August 2006, SCEC issued 23,000,000 shares of its common stock to its founder for $23,000.

In October 2006, SCEC issued 2,800,000 shares of its common stock as part consideration in its purchase of certain oil and gas leases. The 2,800,000 shares were valued at $2,800,000. See Note 3.

In January 2007, the Company issued 1,000,000 shares of its common stock as part consideration in its purchase of certain oil and gas leases. The 1,000,000 shares were valued at $1,000,000. See Note 3.

In March 2007, the Company acquired all of the 26,925,000 common shares of SCEC then issued and outstanding in consideration for issuing to the shareholders of SCEC 26,925,000 common shares of its common stock.

In April 2007, the Company issued 200,000 shares of its common stock for $200,000.

In April 2007, the Company issued 400,000 shares of its common stock as part consideration in its purchase of certain oil and gas leases. The 400,000 shares were valued at $400,000. See Note 3.

In May 2007, the Company issued 700,000 shares of its common stock for $700,000.

In May 2007, the Company issued 20,000 shares of its common stock for services rendered by its President valued at $25,000.

In June 2007, the Company issued 150,000 shares of its common stock for $300,000.

In June 2007, the Company issued 80,000 shares of its common stock for $200,000.

In July 2007, the Company issued 100,000 shares of its common stock for $250,000.

In August 2007, the Company issued 500,000 shares of its common stock for $600,000.

In September 2007, the Company issued 833,333 shares of its common stock for $1,000,000.

In October 2007, the Company issued to three consultants 300,000 shares of its common stock each for services valued at $321,000.

In May 2008, the Company issued 333,333 shares of its common stock for $100,000.

The expiration dates of the warrants range from two to three years after date of grant with exercise prices ranging from $1.50 to $3.00 per share.

In April 2008, the Company received $10,000 from the Company’s President. The loan is unsecured, non-interest bearing, and due on demand.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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 (also our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.

As of June 30, 2008, the end of our fiscal year covered by this report, we carried out an evaluation, under the supervision and with the participation of Lewis Dillman, our Chief Executive Officer (also our principal executive officer), and George Drazenovic, our Chief Financial Officer (also our principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our Chief Executive Officer (also our principal executive officer) and Chief Financial Officer (also our principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this annual report.

There have been no significant changes in our internal controls over financial reporting that occurred during the year ended June 30, 2008 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act, as amended). In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of control procedures. The objectives of internal control include providing management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management’s authorization and recorded properly to permit the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States. Our management assessed the effectiveness of our internal control over financial reporting as of June 30, 2008. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework. Our management has concluded that, as of June 30, 2008, our internal control over financial reporting is effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with US generally accepted accounting principles. Our management reviewed the results of their assessment with the Audit Committee of our Board of Directors.

This annual report does not include an attestation report of our company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit our company to provide only management’s report in this annual report.

The following individuals serve as the directors and executive officers of our company. All directors of our company hold office until the next annual meeting of our shareholders or until their successors have been elected and qualified. The executive officers of our company are appointed by our board of directors and hold office until their death, resignation or removal from office.

The following is a brief account of the education and business experience during at least the past five years of each director, executive officer and key employee of our company, indicating the person's principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.

Mr. Dillman is a seasoned management executive with more than 15 years of experience in the public and private resource industry. He has served as President and founding director of several publicly-traded resource companies. He has also assisted several venture oil startups on numerous resource projects, including United Rayore Gas, a Canadian listed company that drilled and/or participated in more than 80 horizontal wells throughout Alberta and Saskatchewan.

Lewis Dillman holds a Masters degree in International Affairs from Columbia University in New York with a specialization in international banking and finance. He is a director of Zappa Resources and Abington Ventures Inc., both listed on the TSX Venture Exchange and actively engaged in oil and gas production and exploration activities throughout North America. Mr. Dillman is ideally suited to lead Sun Cal Energy’s acquisition and development of oil and gas properties in America’s most productive hydrocarbon producing areas.

Mr. Drazenovic is a certified general accountant and certified financial analyst. He also holds a Master of Business Administration from the University of Notre Dame. Currently, Mr. Drazenovic is the CFO and a director of Oramed Pharmaceuticals Inc. From August 2001 to January 2005, Mr. Drazenovic was the Financial Manager, Engineering Services for BC Hydro. From January 1995 to May 2000, Mr. Drazenovic was the Manager – Accounting for Queensboro Investments. Mr. Drazenovic is currently also a director of Oramed Pharmaceuticals Inc., a company whose common stock is quoted on the OTC Bulletin Board.

None of our directors, executive officers, promoters or control persons have been involved in any of the following events during the past five years:

All proceedings of our board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the corporate laws of the state of Nevada and the bylaws of our company, as valid and effective as if they had been passed at a meeting of the directors duly called and held.

Our company currently does not have nominating, compensation or audit committees or committees performing similar functions nor does our company have a written nominating, compensation or audit committee charter. Our board of directors does not believe that it is necessary to have such committees because it believes that the functions of such committees can be adequately performed by the sole director.

Our company does not have any defined policy or procedure requirements for shareholders to submit recommendations or nominations for directors. The sole director believes that, given the early stage of our development, a specific nominating policy would be premature and of little assistance until our business operations develop to a more advanced level. Our company does not currently have any specific or minimum criteria for the election of nominees to the sole director and we do not have any specific process or procedure for evaluating such nominees. The sole director assesses all candidates, whether submitted by management or shareholders, and makes recommendations for election or appointment.

A shareholder who wishes to communicate with our board of directors may do so by directing a written request addressed to our Chief Executive Officer, at the address appearing on the first page of this current report.

Our board of directors has determined that we do not have a board member that qualifies as an “audit committee financial expert” as defined in Item 401(e) of Regulation S-B, nor do we have a board member that qualifies as “independent” as the term is used in Item 7(d)(3)(iv)(B) of Schedule 14A under the Securities Exchange Act of 1934, as amended, and as defined by Rule 4200(a)(14) of NASDAQ Marketplace Rules.

We believe that our board of directors is capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. The sole director of our company does not believe that it is necessary to have an audit committee because our company believes that the functions of an audit committee can be adequately performed by our board of directors. In addition, we believe that retaining an independent director who would qualify as an “audit committee financial expert” would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development.

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors and persons who own more than 10% of a registered class of our equity securities to file with the Securities and Exchange Commission initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our shares of common stock and other equity securities, on Forms 3, 4 and 5,

respectively. Executive officers, directors and greater than 10% shareholders are required by the Securities and Exchange Commission regulations to furnish us with copies of all Section 16(a) reports they file.

Based solely on our review of the copies of such forms received by our company, or written representations from certain reporting persons that no Form 5s were required for those persons, we believe that, during the fiscal year ended June 30, 2008, all filing requirements applicable to our officers, directors and greater than 10% beneficial owners as well as our officers, directors and greater than 10% beneficial owners of our subsidiaries were complied with, with the exception of the following:

who we will collectively refer to as our named executive officers, of our company for the years ended June 30, 2008 and 2007, are set out in the following summary compensation table, except that no disclosure is provided for any named executive officer, other than our principal executive officers, whose total compensation does not exceed $100,000 for the respective fiscal year: The table below summarizes all compensation awarded to, earned by, or paid to our executive officers by any person for all services rendered in all capacities to us for the fiscal year ended June 30, 2008.

SUMMARY COMPENSATION TABLE
Name and Principal Position	Year	Salary ($)	Bonus ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)	Total ($)
Lewis Dillman⁽¹⁾ President and Chief Executive Officer	2008 2007	95,000 28,000	Nil N/A	0 25,000	Nil N/A	Nil N/A	Nil N/A	Nil N/A	95,000 53,000
George Drazenovic⁽²⁾ Secretary and Treasurer	2008 2007	141,000 90,000	Nil N/A	Nil N/A	Nil N/A	Nil N/A	Nil N/A	Nil N/A	141,000 90,000
William Stewart⁽³⁾ Former President,	2008	Nil	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Chief Executive Officer and Chief Financial Officer	2007	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A

⁽¹⁾	Mr. Dillman became our President and Chief Executive Officer on May 1, 2007.
⁽²⁾	Mr. Drazenovic became our President, Chief Executive Officer, Secretary and Treasurer on November 6, 2006.
⁽³⁾	Mr. Stewart resigned as a director and officer on November 7, 2006.

On March 1, 2007, we entered into a consultant agreement with Lewis Dillman, our Chief Executive Officer, for him to render his executive services to our company as our Chief Executive Officer. This agreement was later superceded by a further consultant agreement dated May 1, 2007. Under this agreement, we were to pay Mr. Dillman compensation of $7,000 per month and to grant him 250,000 shares of our common stock as a signing bonus. However, Mr. Dillman declined to accept the 250,000 shares of our common stock as a signing bonus and we have deleted the provision of signing bonus in this consultant agreement.

Currently, our company does not have a stock option plan in favor of any director, officer, consultant or employee of our company.

Our company did not grant any options or stock appreciation rights during our fiscal year ended June 30, 2008.

There were no options exercised during our fiscal year ended June 30, 2008 by any officer or director of our company.

We reimburse our directors for expenses incurred in connection with attending board meetings but did not pay director's fees or other cash compensation for services rendered as a director during our fiscal year ended June 30, 2008.

We have no present formal plan for compensating our directors for their service in their capacity as directors. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. The sole director may award special remuneration to any director undertaking any special services on behalf of our company other than services ordinarily required of a director. Members of special or standing committees may be allowed like reimbursement and compensation for attending committee meetings.

Indebtedness of Directors, Senior Officers, Executive Officers and Other Management

None of the directors or executive officers of our company or any associate or affiliate of our company during the last two fiscal years, is or has been indebted to our company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding.

The following table sets forth, as of September 15, 2008, certain information with respect to the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our common stock, as well as by each of our current directors and executive officers as a group. Each person has sole

voting and investment power with respect to the shares of common stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated.

Name and Address of Beneficial Owner	Title of Class	Amount and Nature of Beneficial Ownership⁽¹⁾	Percentage of Class⁽¹⁾
George Drazenovic, Secretary, Treasurer and Director Principal Financial Officer, Suite 700, 205 - 5th Avenue, SW Calgary, AB Canada	Common Stock	40,548,600	48.97%
Lewis Dillman President and Chief Executive Officer Suite 700, 205 - 5th Avenue, SW Calgary, AB Canada	Common Stock	25,000	0.03%
Directors and Executive Officers as a Group (1 person)	Common Stock	40,573,600	49.00%

Other than as listed below, none of the following parties has, since our date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:

On March 12, 2007 we completed the transaction contemplated under a share exchange agreement between our company and the shareholders of Sun Cal Energy Corp. The former shareholders of Sun Cal Energy Corp. received 26,925,000 shares of our company’s common stock, representing approximately 34.44% of the issued and outstanding shares of our company after closing of the share exchange agreement. Our CFO and director, George Drazenovic, was a shareholder of Sun Cal Energy Corp.

We currently act with one director and two executive officers. As George Drazenovic is our sole director and holds approximately 48.97% of our common stock as of September 15, 2008, Mr. Drazenovic is not independent as defined in Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act.

We do not have a standing audit, compensation or nominating committee, but our entire board of directors acts in such capacities. We believe that the sole member of our board of directors is capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. The sole director of our company does not believe that it is necessary to have a standing audit, compensation or nominating committee because we believe that the functions of such committees can be adequately performed by the sole director, solely consisting of George Drazenovic. In addition, we believe that retaining one or more directors who would qualify as independent in accordance with Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact the we have not generated any revenues from operations to date.

Effective September 10, 2007, our company's board of directors adopted a Code of Business Conduct and Ethics that applies to, among other persons, our company's president (being our principal executive officer) and our company's secretary (being our principal financial and accounting officer and controller), as well as persons performing similar functions. As adopted, our Code of Business Conduct and Ethics sets forth written standards that are designed to deter wrongdoing and to promote:

(1) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

(2) full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with, or submit to, the Securities and Exchange Commission and in other public communications made by us;

(4) the prompt internal reporting of violations of the Code of Business Conduct and Ethics to an appropriate person or persons identified in the Code of Business Conduct and Ethics; and

Our Code of Business Conduct and Ethics requires, among other things, that all of our company's personnel shall be accorded full access to our president and secretary with respect to any matter which may arise relating to the Code of Business Conduct and Ethics. Further, all of our company's personnel are to be accorded full access to our company's board of directors if any such matter involves an alleged breach of the Code of Business Conduct and Ethics by our president or secretary.

In addition, our Code of Business Conduct and Ethics emphasizes that all employees, and particularly managers and/or supervisors, have a responsibility for maintaining financial integrity within our company, consistent with generally accepted accounting principles, and federal, provincial and state securities laws. Any employee who becomes aware of any incidents involving financial or accounting manipulation or other irregularities, whether by witnessing the incident or being told of it, must report it to his or her immediate supervisor or to our company's president or secretary. If the incident involves an alleged breach of the Code of Business Conduct and Ethics by the president or secretary, the incident must be reported to any member of our board of directors. Any failure to report such inappropriate or irregular conduct of others is to be treated as a severe disciplinary matter. It is against our company policy to retaliate against any individual who reports in good faith the violation or potential violation of our company's Code of Business Conduct and Ethics by another.

Our Code of Business Conduct and Ethics is filed as Exhibit 14.1 to our annual report on Form 10-KSB filed on October 15, 2007. We will provide a copy of the Code of Business Conduct and Ethics to any person without charge, upon request. Requests can be sent to: Sun Cal Energy, Inc. at 700-205 – 5th Avenue SW, Calgary AB T2P 2V7.

The aggregate fees billed for professional services rendered by our principal accountant for the audit of our annual financial statements for the fiscal years ended June 30, 2008 and 2007 were $14,904 and $17,500 respectively.

We incurred no fees for the fiscal years ended June 30, 2008 and 2007 for assurance and related services by our principal accountant that were reasonably related to the performance of the audit or review of our financial statements, and not reported under Audit Fees above.

We incurred no fees for the fiscal years ended June 30, 2008 and 2007 for preparation of tax returns and for tax related advice.

We incurred no other fees during the fiscal years ended June 30, 2008 and 2007 and since inception for products and services rendered by our principal accountants other than those stated in this and other publicly posted reports (see www.sec.gov).

Section 10A(i) of the Exchange Act prohibits our auditors from performing audit services for us, as well as any services not considered to be "audit services", unless such services are pre-approved by the audit committee of the sole director, or unless the services meet certain de minimis standards. Because we are still in the development stage and have not yet completed our business plans and/or generated any revenues, we have not yet appointed an audit committee. Our Board of Directors ensure that:

All audit services that the auditor may provide to us or any subsidiary (including, without limitation, providing comfort letters in connection with securities underwritings or statutory audits) as required by s.10A(i)(1)(A) of the Exchange Act (as amended by the Sarbanes-Oxley Act of 2002) are preapproved by the Board. All non-audit services (other than certain de minimis services described in s.10A(i)(1)(B) of the Exchange Act (as amended by the Sarbanes-Oxley Act of 2002)) that the auditors propose to provide to us or any of our subsidiaries are preapproved by the Board. All audit fees were approved by the sole director.

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

By: /s/ Lewis Dillman
Lewis Dillman
President and Chief Executive Officer
(Principal Executive Officer)
Date: September 29, 2008.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ George Drazenovic
George Drazenovic
Secretary, Treasurer and Director
(Principal Financial Officer)
Date: September 29, 2008.

By: /s/ Lewis Dillman
Lewis Dillman
President and Chief Executive Officer
(Principal Executive Officer)
Date: September 29, 2008.

Nevada	81-0659377
(State or other jurisdiction of incorporation or	(I.R.S. Employer Identification No.)
organization)

Suite 700, 205 - 5th Avenue, SW
Calgary, AB Canada	T2P 2V7
(Address of principal executive offices)	(Zip Code)

Title of each class	Name of each exchange on which registered
Nil	Nil

ITEM 1:	DESCRIPTION OF BUSINESS	4
FORWARD LOOKING STATEMENTS		4
OVERVIEW		4
RISK FACTORS		8
RISKS RELATED TO OUR BUSINESS		8
RISKS ASSOCIATED WITH OUR COMPANY		10
RISKS ASSOCIATED WITH OUR COMMON STOCK		11
ITEM 2:	DESCRIPTION OF PROPERTY	12
EXECUTIVE OFFICES		12
ITEM 3:	LEGAL PROCEEDINGS	13
ITEM 4:	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	13
ITEM 5:	MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS	14
MARKET INFORMATION		14
ITEM 6:	MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION	15
ITEM 7:	FINANCIAL STATEMENTS	19
ITEM 8:	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	21
ITEM 8A:	CONTROLS AND PROCEDURES	21
ITEM 9:	DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS	22
DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS		22
ITEM 10:	EXECUTIVE COMPENSATION	24
EXECUTIVE COMPENSATION		24
ITEM 12:	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	26
ITEM 13:	EXHIBITS AND REPORTS	28
ITEM 14:	PRINCIPAL ACCOUNTANT FEES AND SERVICES	29
AUDIT FEES		29
AUDIT RELATED FEES		29
TAX FEES		29
ALL OTHER FEES		29
AUDIT COMMITTEE REQUIREMENTS		29
SIGNATURES		30

	Year Ended June 30,
				%
				Increase /
	2007		2008	(Decrease)
Revenue	Nil		139,441	100%
Operating Expenses	654,480		1,443,480	(120.5%	)
Interest & Dividend Income	-		1,891	100%
Loss on disposition of asset	(581	)	-	(100%	)
Net Loss	655,061		1,302,148	98.78%

		Ended June 30,
					%
					Increase /
		2007		2008	(Decrease)
Abandoned Exploration Costs	$	5,500	$	-	(100%	)
Oil and gas expenses		-		20,916	100%
General and Administrative Expenses		648,980		1,422,564	119.20%
Total Operating Expenses	$	654,480	$	1,443,480	120.55%

		June 30, 2007		June 30, 2008
Current Assets	$	590,747	$	256
Current Liabilities		31,916		61,360
Working Capital	$	558,831	$	(61,104	)

Report of Independent Registered Public Accounting Firm	F-1

Financial Statements

Consolidated Balance Sheets	F-2

Consolidated Statements of Operations	F-3

Consolidated Statements of Stockholders’ Equity	F-4

Consolidated Statements of Cash Flows	F-5

Notes to Consolidated Financial Statements	F-6

		June 30,
		2007			2008

ASSETS

Current assets
Cash and cash equivalents	$	590,747		$	256
Accounts receivable		-			122,610
Prepaid expenses		4,550			-
		595,297			122,866

Property and equipment
Oil and gas properties, full cost method of accounting		5,557,673			7,032,850

Intangible assets		11,913			7,463

Total assets	$	6,164,883		$	7,163,179


LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
Accounts payable and accrued expenses	$	31,916		$	51,360
Payable to related party		-			10,000

Total liabilities		31,916			61,360

Stockholders' equity
Common stock:
Authorized: 750,000,000 with $0.001 par value
Issued and outstanding: 80,730,000 shares as of June 30, 2007
and 82,796,666 shares as of June 30, 2008		80,730			82,796
Additional paid-in capital		6,756,270			9,025,204
Deficit accumulated during the exploratory stage		(704,033	)		(2,006,181	)
		6,132,967			7,101,819

Total liabilities and stockholders' equity	$	6,164,883		$	7,163,179

								From
								July 20, 2004
		For the Year ended						(Inception)
		June 30,						through
		2007			2008			June 30, 2008


Income earned during the exploratory stage	$	-		$	139,441		$	139,441

Operating expenses
Abandoned exploration costs		5,500			-			12,500
Oil and gas expenses		-			20,916			20,916
General and administrative expenses		648,980			1,422,564			2,113,516
		654,480			1,443,480			2,146,932

Net loss from operations		(654,480	)		(1,304,039	)		(2,007,491	)

Other income (expense)
Interest income		-			1,891			1,891
Loss on disposition of asset		(581	)		-			(581	)

Net loss	$	(655,061	)	$	(1,302,148	)	$	(2,006,181	)

Net loss per share - basic and diluted	$	(0.01	)	$	(0.02	)

Weighted average common shares
outstanding - basic and diluted		73,574,986			82,112,058

											Deficit
											Accumulated
								Additional			During the
			Price per	Common stock				Paid-in			Exploratory
	Date		share	Shares		Amount		Capital			Stage			Total

Balance, July 20, 2004				-	$	-	$	-		$	-		$	-

Shares issued to founders	12/15/04	$	0.001	20,000,000		20,000		(18,000	)		-			2,000
Shares issued for cash	2/28/05	$	0.001	28,250,000		28,250		-			-			28,250
Shares issued for cash	3/31/05	$	0.005	3,000,000		3,000		12,000			-			15,000
Contributed services and rent	Various			-		-		7,500			-			7,500
Net loss				-		-		-			(18,005	)		(18,005	)

Balance, June 30, 2005				51,250,000		51,250		1,500			(18,005	)		34,745

Contributed services and rent	Various			-		-		9,000			-			9,000
Net loss				-		-		-			(30,967	)		(30,967	)

Balance, June 30, 2006				51,250,000		51,250		10,500			(48,972	)		12,778


Shares issued for cash	8/3/06	$	0.001	23,000,000		23,000		-			-			23,000
Contributed services and rent	9/30/06							2,250			-			2,250
Shares issued for cash	10/1/06	$	1.000	375,000		375		374,625			-			375,000
Shares issued for cash	10/17/06	$	1.000	250,000		250		249,750			-			250,000
Shares issued as partial consideration in acquisition	10/21/06			2,800,000		2,800		2,797,200			-			2,800,000
of oil and gas leases
Shares issued for cash	12/1/06	$	1.000	500,000		500		499,500			-			500,000
Shares issued as partial consideration in acquisition
of oil and gas leases	1/1/07			1,000,000		1,000		999,000			-			1,000,000
Shares issued for cash	4/1/07	$	1.000	200,000		200		199,800			-			200,000
Shares issued as partial consideration in acquisition
of oil and gas leases	4/19/07	$	1.000	400,000		400		399,600			-			400,000
Shares issued for cash	5/1/07	$	1.000	700,000		700		699,300			-			700,000
Shares issued for services	5/1/07	$	1.000	25,000		25		24,975			-			25,000
Shares issued for cash	6/14/07	$	2.000	150,000		150		299,850			-			300,000
Shares issued for cash	6/29/07	$	3.000	80,000		80		199,920			-			200,000
Net loss				-		-		-			(655,061	)		(655,061	)

Balance, June 30, 2007				80,730,000.00		80,730		6,756,270			(704,033	)		6,132,967

Shares issued for cash	7/27/07	$	2.500	100,000.00		100		249,900			-			250,000
Shares issued for cash	8/29/07	$	1.200	500,000.00		500		599,500			-			600,000
Shares issued for cash	9/24/07	$	1.200	833,333.00		833		999,167			-			1,000,000
Shares issued for services	10/8/07	$	1.070	100,000.00		100		106,900			-			107,000
Shares issued for services	10/8/07	$	1.070	100,000.00		100		106,900			-			107,000
Shares issued for services	10/26/07	$	1.070	100,000.00		100		106,900			-			107,000
Shares issued for cash	5/24/08	$	0.300	333,333.00		333		99,667			-			100,000
Net loss				-		-		-			(1,302,148	)		(1,302,148	)

Balance, June 30, 2008				82,796,666.00	$	82,796	$	9,025,204		$	(2,006,181	)	$	7,101,819

		June 30,
		2007			2008
Website development	$	13,349		$	13,349
Accumulated amortization		(1,436	)		(5,886	)
	$	11,913		$	7,463

			Weighted
			Average
	Number of		Exercise
	warrants		Price

Outstanding – June 30, 2006	-	$	-

Granted	2,255,000	$	1.62
Exercised	--		--
Forfeited	--		--

Outstanding – June 30, 2007	2,255,000	$	1.62

Granted	1,766,666	$	1.47
Exercised	--		--
Forfeited	--		--

Outstanding – June 30, 2008	4,021,666	$	1.55

Name	Position Held with our Company	Age	Date First Elected or Appointed
George Drazenovic	Secretary, Treasurer and Director	37	November 7, 2006
Lewis Dillman	President and CEO	51	May 1, 2007

	1.	any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

	2.	any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding

Name	Number of Late Reports	Number of Transactions Not Reported on a Timely Basis	Failure to File Required Forms
George Drazenovic	2¹	2	None
Lewis Dillman	1²	1	None

		traffic violations and other minor offences);

	3.	being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

	4.	being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

	(a)	our principal executive officer;

	(b)	each of our two most highly compensated executive officers who were serving as executive officers at the end of the year ended June 30, 2007; and

	(c)	up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our executive officer at the end of the year ended June 30, 2008,

Number	Description

3.1	Articles of (Incorporation incorporated by reference to our registration statement on form SB-2 filed on July 11, 2005)

3.2	Bylaws (incorporated by reference to our registration statement on form SB-2 filed on July 11, 2005)

3.3	Articles of Merger (incorporated by reference to our current report on Form 8-K filed on November 7, 2006)

3.4	Certificate of Change (incorporated by reference to our current report on Form 8-K filed on November 7, 2006)

3.2	Bylaws (incorporated by reference to our registration statement on form SB-2 filed on July 11, 2005)

10.1	Mineral property purchase agreement dated April 26, 2005 (incorporated by reference to our registration statement on form SB-2 filed on July 11, 2005)

10.2	Share Exchange Agreement dated January 31, 2007 (incorporated by reference to our current report on Form 8-K filed on March 22, 2007)

10.3	Letter Agreement dated October 4, 2006 with Western Energy Capital, LLC for the acquisition of 45% working interest in the Lokern leases (incorporated by reference to our current report on Form 8-K filed on March 22, 2007)

10.3	Letter Agreement dated October 18, 2006 with TriMar Energy Partners, Inc. for the acquisition of 1.5% of 8/8th Overriding Royalty Interest in the Hobart Lease (incorporated by reference to our current report on Form 8-K filed on March 22, 2007)

10.4	Consulting Agreement dated May 1, 2007 (incorporated by reference to our current report on Form 8-K filed on May 7, 2007)

10.5	Letter Agreement dated April 19, 2007 with Western Energy Capital, LLC for the acquisition of 5% working interest in the Britlind Prospect Leases (incorporated by reference to our annual report on Form 10-KSB filed on October 15, 2007)

10.6	Purchase and Sale Agreement between our company and King Royalty Corporation for the acquisition of 5% interest in the Centurion property (incorporated by reference to our annual report on Form 10-KSB filed on October 15, 2007)

10.7	Purchase and Sale Agreement between our company and Desert Mining, Inc. for the acquisition of interests in the Jonah property (incorporated by reference to our annual report on Form 10-KSB filed on October 15, 2007)

14.1	Code of Ethics (incorporated by reference to our annual report on Form 10-KSB filed on October 15, 2007)

21.1	Sun Cal Energy, Corp. a Nevada company, 100% wholly-owned subsidiary

31.1*	CEO Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934

31.2*	CFO Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934

32.1*	CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2*	CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002