ITEM 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations

General Overview

Apolo Gold & Energy Inc. ("Company") was incorporated in March 1997 under the laws of the State of Nevada. Its objective was to pursue mineral properties in South America, Central America, North America and Asia. The Company incorporated a subsidiary - Compania Minera Apologold, C.A in Venezuela to develop a gold/diamond mining concession in Southeastern Venezuela. Project was terminated in August 2001, due to poor testing results and the property abandoned. This subsidiary company has been inactive since 2001 and will not be reactivated.

On April 16, 2002, the Company announced the acquisition of the mining rights to a property known as the Napal Gold Property, ("NUP"). This property is located 48 km south-west of Bandar Lampung, Sumatra, Indonesia. The property consists of 733.9 hectares and possesses a Production Permit (a KP) # KW. 098PP325.

The terms of the Napal Gold Property call for a total payment of $375,000 US over a six-year period of which a total of $250,000 have been made to date. Company paid $250,000 over the past 5 years and subsequent to the year ending June 30, 2008 the Company terminated its agreement on the NUP property and returned all exploration rights to the owner.

The Company continues to pursue opportunities in the natural resource industry and will consider an investment in any other energy related business in order to create value.

At September 30, 2008, the Company had funds on hand of $673.

The Company recognizes that it does not have sufficient funds on hand to finance its operations on an ongoing basis. The Company further recognizes that it is dependent on the ability of its management team to obtain the necessary working capital in order to complete projects started and operate successfully. There is no assurance that the Company will be able to obtain additional capital as required, or if the capital is available, to obtain it on terms favorable to the Company. The Company may suffer from a lack of liquidity in the future that could impair its exploration efforts and adversely affect its results of operations.

Results of Operations

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In the three months ended September 30, 2008, the Company incurred a loss of $45,465 vs. a loss of $ $60,775 for the three months ended September 30, 2007.

Expenses in the three months ending September 30, 2008 were lower because there has been no exploration expense in the current year as the company has relinquished its rights to the NUP property in Sumatra Indonesia, and general and administrative expenses have been reduced to $2,988 in the three months ending September 30, 2008 compared to $23,540 for the three months ending September 30, 2007.

Consulting and professional fees for the three months ending September 30, 2008 are $42,476 vs. $37,053 for the three months ending September 30, 2007. The increase was due to higher professional fees in the current year.

The Company recognizes that it will require additional capital in order to continue its search for a mineral property or other project that is beneficial to the shareholders of the company. There is no assurance at this time that said capital can be raised on terms and conditions acceptable to management.

At September 30, 2008 there were 80,453,729 shares outstanding which is unchanged from June 30, 2008.

The Company at September 30, 2008 has current accounts payable of $150,692 and amounts due to former affiliates of $30,320 for a total of $172,012 compared to $180,011 payable at June 30, 2008

Loans payable to related parties at September 30, 2008 amounted to $308,153 compared to $269,817 at June 30, 2008. These loans include fees payable to current officers of the Company. There are currently no specific terms of repayment of these items.

Cash on hand at September 30, 2008 amounted to $673. The Company is aware that additional financing will be required in order to continue its pursuit of a mineral property opportunity or a comparable opportunity in a related field. There is no assurance that additional funding will be successfully completed.

The Company has no employees other than officers and uses consultants as and when necessary.

LIQUIDITY AND CAPITAL RESOURCES

The Company has limited financial resources at September 30, 2008 with funds on hand of $673 vs. $5,803 at June 30, 2008 and $1,818 at September 30, 2007.

During the three months ending September 30, 2008, there has been very little activity as the Company pursued opportunities in the energy sector. A number of opportunities have been reviewed and to date none has resulted in a Definitive Agreement. The Company has current accounts payable of $182,012, which includes trade payables of $150,691. This compares to payables of $180,011 at June 30, 2008 and payables of $149,520 at September 30, 2007.

Related party loans at September 30, 2008 amount to $308,153 compared to $269,817 at June 30, 2008 and $176,970 at September 30, 2007. These loans are due to directors/officers of the Company for services and loans advanced to the Company. While the Company continues to seek out additional capital, there is no assurance that they will be successful in completing this necessary financing. The Company recognizes that it is dependent on the ability of its management team to obtain the necessary working capital required.

While in the pursuit of additional working capital, the Company is also very active in reviewing other resource development opportunities and will continue with these endeavors.

Inflation has not been a factor during the three months ending September 30, 2008.