United States Oil and Gas Corp (fka USOG)

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USOG Corporate does not have access to the Trunbull cash flow from operations. In other words, USOG can not use Trunbull revenue or profits to pay the Trunbull note. The same is true for United.

2Q-2010 Financials page 13: http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=35884

Statement of Cash Flows
The cash balance decreased slightly in the quarter from $503,186 to $462,006, but is higher than the $348,685 at the start of the year. Operating activities provided $35,722 of cash and the company invested $115,000 on new equipment.

The company is pursuing additional cash from the sale of convertible notes to existing shareholders as well as equity financing through investment banks and accredited investors to fund the remaining balance on the note to Jeff Turnbull and owners of United Oil. Once these notes are paid, the Company will have full access to the proceeds from operations.

Page 9:

NOTE 4 – DEBT
Debt consisted of the following at June 30, 2010:
Short term:
Unsecured convertible notes payable with annual interest rate of 5% $ 154,700
Unsecured convertible notes payable with annual interest rate of 10% 73,100
Total convertible notes 420,400

Unsecured note payable with annual interest of 5%, maturing December 31, 2011 $ 500,000
Unsecured note payable with annual interest rate of 3.5%, maturing December 31, 2010. Note
is convertible to common stock. 3,994,432

Long term:
Note payable with annual interest payable quarterly and maturing April 9, 2011. 750,000

Minimum principal payments of long term debt in subsequent years:
2011 $ 1,250,000
2012
2013
2014
Interest expense on the notes payable for the three months ended June 30, 2010 totaled $17,334