Summary of BERING EXPLORATION, INC.

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of the Company's financial condition as of December 31, 2012 and 2011, and its results of operations for the three and nine months ended December 31, 2012 and 2011, should be read in conjunction with the audited consolidated financial statements and notes included in Bering Exploration Inc.'s Form 10-K for the year ended March 31, 2012, filed with the Securities and Exchange Commission.

Overview

In July 2010, the Company determined to primarily focus its business on the exploration, acquisition, development, production and sale of natural gas, crude oil and natural gas liquids from conventional reservoirs within the United States.

In addition, the Company owns 25% of Intertech Bio, which is developing products to treat cancer, infectious diseases and other medical conditions associated with compromised immune systems. The Company is not actively involved in the management of Intertech Bio.

A description of the Company's oil and gas properties follows.

Central Texas Project,

Caldwell County, Texas

In March 2011, the Company leased the mineral rights on approximately 1,283 gross acres targeting the Eagle Ford shale play in South Texas. This prospect has an aeromagnetic survey and the company expects to utilize it and other advanced techniques to maximize oil recovery from the Eagle Ford, Austin Chalk, Buda and Edwards zones. Bering will retain a 100% working interest and an 81% net revenue interest with a two year lease term.

The Eagle Ford Shale is a shale rock formation located in multiple counties in South Texas. It underlies the Austin Chalk and the Edwards limestone formation is just below it. It is considered by geologists to be the "source rock", or the original source of hydrocarbons (oil and gas) that are now found in the Austin Chalk above it.

Chicas Locas Field,

Victoria County, Texas

In June 2011, the Company entered into a joint development agreement to co-develop an approximately 640 acre tract in Victoria County, Texas. The Company will retain a 50% working interest in this prospect. Our net revenue interest in this field is 37.5%. In August 2011, the first well developed in this area began producing oil. The well is currently producing 4 bbl of oil per day. The operator of the well has determined that the well is producing more natural gas than oil and has installed a gas pipeline to connect the well to a commercial pipeline. In April 2012, the pipeline was completed and we began producing natural gas accordingly. Our share of net production on this well was $11,213 and $30,743 during the three and nine months ended December 31, 2012.

Singer Prospect,

Beauregard Parish, Louisiana

In August and October 2011, the Company leased the mineral rights on 320 gross acres in Singer, Louisiana. Initial geological assessment reveals four sands in zones from 9,600' to 10,600' with four potential drilling locations. Bering retains a 90% working interest in the prospect and a 37.5% net revenue interest. In August and October 2012, the Company extended the leases for an additional year.

Ashland Prospect,

Concordia Parish, Louisiana

In July 2011, the Company purchased a 10% working interest in the Ashland prospect in Concordia Parish, Louisiana. Our net revenue interest in this well is 75%. The prospect contains 1,200 acres. Preliminary geological analysis reveals two sands between 6,900' and 7,100'. In September 2011, the Sharp Heirs A No. 1 (A-1) well was successfully drilled on the prospect. The well was completed in November 2011 and is producing approximately 26 gross barrels of oil per day. In November 2011, a second well was drilled on this prospect. It was not commercially viable and was converted into a salt water disposal well. This well will be used to off load water produced in the first well and allow for production to increase on the first well. This work was completed and permitted in July 2012. A third well was drilled in May 2012 and is in the process of being completed. Our share of net production on the A-1 well was $5,219 and $35,029 during the three and nine months ended December 31, 2012. In October 2012, the Company assigned its interest in the Ashland Prospect to an unrelated third party in exchange for $150,000.

Gohlke Project,

Texas Gulf Coast

In October 2011, the Company leased the mineral rights to 10,000 feet on 272 gross acres in South Texas. The tract has 12 potential drilling locations. Preliminary geological assessment reveals 3 sands at depths of 3,800', 5,500' and 8,100'. Bering currently holds a 95% working interest and a 76.5% net revenue interest.

North Edna Project,

Jefferson Davis Parish, Louisiana

In May 2012, the Company acquired a 74% net revenue interest and a 100% of working interests in the North Edna Field located in Jefferson Davis Parish, Louisiana ("N. Edna"). N. Edna consists of 384.84 gross acres and the Lejeune No. 1 oil and gas well (Lejeune 1). The Lejeune 1 was not producing at the date of acquisition. The Company began a workover of this well in July 2012 in an effort to restart production. The workover was completed in late January 2013. Test results indicate that commercially viable levels of natural gas are present. Additional testing and AFEs are required to determine when the well will be completed. The Company has incurred $24,090 and $87,645 in workover related costs during the three and nine months ended December 31, 2012, respectively. There are 3 new potential wells located on this lease.

South Texas Project,

Texas Gulf Coast

In September 2010, the Company obtained a 5% back in after payout working interest in a single well being drilled in South Texas, along the Texas Gulf Coast. The well was successfully completed and is producing natural gas. The operator of the well does not expect payout to occur in the near future. Until such time as payout is achieved, the Company has no rights to the production from this well and accordingly, has not recognized any oil and gas revenues or reserves from this well.

Comparison of Three Months Ended December 31, 2012 and 2011

The Company had oil and gas revenues of $16,432 for the three months ended December 31, 2012 and $39,687 in revenue for the three months ended December 31, 2011. The decrease in revenues of $23,255 was due to the success of two wells completed in the calendar quarter ending December 31, 2011, compared to slower production in the three months ended December 31, 2012.

The Company's expenses decreased from $1,668,345 for three months ended December 31, 2011 to $364,613 for three months ended December 31, 2012. The decrease of $1,303,732 was mainly due to the following: a decrease in stock based compensation and compensation expense of $1,369,269, offset by oil and gas lease operating expenses of $34,971 and other expenses of $22,131.

In addition, interest expense decreased $700,095, from $760,752 interest expense, net during the three months ended December 31, 2011 to $60,657 during the three months ended December 31, 2012, primarily due to no modifications during the current quarter.

As a result of the foregoing, the Company's net loss for the three months ended December 31, 2012 and 2011 was $414,959 and $2,393,224, respectively.

Comparison of Nine Months Ended December 31, 2012 and 2011

The Company had oil and gas revenues of $65,772 for the nine months ended December 31, 2012 and $49,369 in oil and gas revenues for the nine months ended December 31, 2011. The increase of $16,403 was due to the overall success of two wells completed in the calendar quarter ending December 31, 2011.

The Company's expenses decreased from $2,422,212 for the nine months ended December 31, 2011 to $2,294,484 for nine months ended December 31, 2012. The decrease of $127,728 was due primarily to increases in oil and gas lease operating expenses of $183,271, professional fees of $122,097, other expenses of $67,103, depreciation, depletion and amortization of $29,854 and office administration expenses of $6,284, offset by decreases in cash and stock based compensation of $399,199 and investor relations of $137,138.

In addition, interest expense decreased by $13,939, from $1,018,117 during the nine months ended December 31, 2011 to $1,004,178 during the nine months ended December 31, 2012. Interest expense during the current period was due to interest expense recorded in connection with the derivative liability and amortization of debt discounts due to the beneficial conversion features on other convertible debt. During the nine months ended December 30, 2012, the Company entered into a debt agreement that resulted in the recognition of a change in derivative liability of $218,864. In the nine months ended December 31, 2011, the Company incurred a Loss on Extinguishment of Debt of $54,332 in connection with the conversion of certain notes payable in our Common Stock.

As a result of the foregoing, the Company's net loss for the nine months ended December 31, 2012 and 2011 was $3,014,026 and $3,445,292, respectively.

Liquidity and Capital Resources

As of December 31, 2012, the Company had $49,606 in cash and negative working capital of $1,035,584. Included in the cash balance are the proceeds from the October 2012, sale of the Company's interest in the Ashland Prospect to an unrelated third party in exchange for $150,000. Additional capital will be necessary to fund ongoing operating costs and planned drilling programs over the next twelve months.

Net cash used in operating activities for the nine months ended December 31, 2012 and 2011 was $501,573 and $245,872, respectively.

We anticipate that future liquidity requirements will arise from the need to finance our operations and continue our lease acquisition and drilling programs. The primary sources of funding for such requirements are expected to be raising additional capital from the sale of equity and/or debt securities. However, we can provide no assurances that we will be able to obtain additional financing on terms satisfactory to us, if at all, to remain a going concern. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis and ultimately to attain profitability. The Company is attempting to obtain cash to finance its operations through the sale of equity, debt borrowing and/or through the sale of working interests in our drilling programs. We can provide no assurances that financing will be available to us on terms satisfactory to us, if at all, or that we will be able to continue as a going concern. In this respect, see Note 2
- Going Concern in our financial statements for additional information as to the possibility that we may not be able to continue as a going concern.