SECURITIES AND EXCHANGE COMMISSION
                    Washington, D.C.  20549

                          FORM 10-QSB

[X]   QUARTERLY REPORT UNDER SECTION 12(g) OF THE
                SECURITIES EXCHANGE ACT OF 1934

     For the quarterly period ended:  March 31, 2002

OR

[  ]  TRANSITION REPORT UNDER SECTION 12(g)
                  OF THE EXCHANGE ACT

For the transition period from __________ to __________

             Commission File No. 33-55254-32

                  CHANCELLOR GROUP, INC.
 __________________________________________________________
  (Exact name of small business issuer as specified in its
                         charter)

Nevada                                   87-0438647
________                                 ____________
(State or other jurisdiction of         (I.R.S. Employer
Incorporation or organization)           Identification  No.)

     1800 E. Sahara, Suite 107, Las Vegas, Nevada  89104
_____________________________________________________________
 (Address of principal executive offices, including zip code)


Issuer's Telephone Number:  (702) 938-0261


______________________________________________________
 (Former name, former address and former fiscal year,
              if changed since last report)


Check whether the Issuer (1) filed all
reports required to be filed by Section 12(g)
of the Exchange Act during the past 12
months (or for such shorter period that the
registrant was required to file such
reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes   X      No
    ____       ____


As of March 31, 2002, 47,017,261 shares of common stock
were outstanding.

Transitional Small Business Disclosure Format:

Yes    X   No
     ____    ____

<PAGE>



TABLE OF CONTENTS
Form 10-QSB
1st Quarter Ended March 31, 2002


Chancellor Group, Inc.

                                                           Page

PART I:  FINANCIAL INFORMATION

            Item 1.

            Consolidated Balance Sheet                       2
            Consolidated Statement Of Operations             3
            Consolidated Statement Of Cash Flows             4
            Notes To Consolidated Financial Statements       5


            Item 2.

            Management's Discussion And
            Analysis Or Plan Of Operation                    8

PART II:  OTHER INFORMATION                                  9


SIGNATURES                                                  10


<PAGE>



              PART I.   FINANCIAL INFORMATION


<PAGE>                              1




ITEM 1.                CHANCELLOR GROUP, INC.
                     CONSOLIDATED BALANCE SHEET
                           MARCH 31, 2002
                             (UNAUDITED)

                               ASSETS

Current Assets

Cash                                  $         -
                                    _____________
    Total current assets                        -

Receivable                                 18,750
                                    _____________

Total Assets                          $    18,750
                                    =============


            LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable                      $   271,320
                                     ____________
    Total current liabilities             271,320
                                     ____________
Total Liabilities                         271,320
                                     ____________

Stockholders' equity

     Common stock: $.001 par
       value, 250,000,000 shares
       authorized, 47,017,261
       shares issued
       & outstanding                      47,017
     Preferred Series B stock:
       $1,000 par value,
       250,000 shares authorized,
       -0- issued and outstanding

     Paid in capital                   3,049,741

     Accumulated deficit             ( 3,349,328)
                                    ____________

Total Stockholders' Equity           (   252,570)
                                    ____________
Total Liabilities And
 Stockholders' Equity               $     18,750
                                    ============

See Notes to Consolidated Financial Statements


<PAGE>	                               2



                         CHANCELLOR GROUP, INC.
                  CONSOLIDATED STATEMENT OF OPERATIONS
                              (UNAUDITED)



                                           Three Months Ended
                                                March 31,
                                           2001          2002
                                           ____          ____


Sales                                   $       -     $       -

Operating expenses                        605,412        49,718
                                        _________     _________
Income (loss) from
 operations                              (605,412)     ( 49,718)
                                        _________     _________

Other income (expenses):
  Interest expense                       ( 21,293)
                                        _________     _________
Income (loss) before provision
 for income taxes                        (626,705)     ( 49,718)

Provision for income tax                        -             -
                                        _________     _________


Net income (loss)                       $(626,705)    $( 49,718)
                                        =========     =========

Net income (loss) per share
(Basic and fully diluted)               $(   .02)    $(      *)
                                        =========     =========

Weighted average number of
common shares outstanding              29,654,261    47,017,261
                                       ==========    ==========
*less than $.01 per share

See Notes to Consolidated Financial Statements


<PAGE>	  	                            3


                       CHANCELLOR GROUP, INC.
                 CONSOLIDATED STATEMENT OF CASH FLOWS
                             (UNAUDITED)

                                               Three Months Ended
                                                     March 31,
                                                2001          2002
                                                ____          ____

Cash Flows From Operating Activities:

   Net income (loss)                         $(626,705)    $ (49,718)

   Adjustments to reconcile net
   income (loss) to net cash
   provided by (used for)
   operating activities:

       Depreciation                                104
       Accounts pay. and accrued expenses      (14,892)      (49,588)
       Compensatory stock issuances            512,000
                                             _________     _________
         Net cash provided
         by (used for)
         operating activities                 (129,493)         (130)
                                             _________     _________


Cash Flows From Financing Activities:

   Sale of common stock                        136,000
   Paid in capital
                                             _________     _________

         Net cash provided
         by (used for)
         financing activities                  136,000
                                             _________     _________


Net Increase (Decrease) In Cash                  6,507          (130)

Cash At The Beginning Of The Period              7,800           130
                                             _________     _________

Cash At The End Of The Period                $  14,307     $       -
                                             =========     =========


See Notes to Consolidated Financial Statements


<PAGE>                           4


                      CHANCELLOR GROUP, INC.
            Notes to Consolidated Financial Statements
                           (Unaudited)


Note 1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited financial statements have been
prepared in accordance with the instructions to
Form 10-QSB and do not include all of the information and
disclosures required by generally accepted accounting
principles for complete financial statements. All
adjustments which are, in the opinion of management,
necessary for a fair presentation of the results of
operations for the interim periods have been made and are
of a recurring nature unless otherwise disclosed herein.
The results of operations for such interim periods are not
necessarily indicative of operations for a full year.

Principles of consolidation

The accompanying consolidated financial statements include the accounts of
Chancellor Group, Inc., and its wholly owned subsidiaries Radly Petroleum, Inc.
("Radly"), Lichfield Petroleum America, Inc. ("Lichfield"), and Getty
Petroleum, Inc. ("Getty"). These entities are collectively hereinafter
referred to as "the Company". All intercompany accounts and transactions
have been eliminated.

Net income (loss) per share

The net income (loss) per share is computed by dividing the net income (loss)
by the weighted average number of shares of common outstanding. Warrants,
stock options, and common stock issuable upon the conversion of the Company's
preferred stock (if any), are not included in the computation if the effect
would be anti-dilutive and would increase the earnings or decrease loss per
share.

Note 2. Legal Proceedings

In October, 2001 pursuant to a civil legal action against the Company's
management filed by a shareholder group in the Federal District Court of
Clark County, Nevada (the "Court"), the assets and operations of the Company
were placed by court order into receivership. In April, 2002 the Court
ordered the Company's President removed from his offices as President and
Director, finding in a civil judgement that the President had in a number of
matters breached his fiduciary duty to the Company. A new temporary Board of
Directors was appointed by the Court.

In September, 2001 a civil legal action was filed against the Company and
other parties in the Federal District Court of Taylor County, Texas with
the Plaintiffs alleging fraud by the Company's President involving a stock
for oil and gas property transaction. The Company currently has no legal
representation in the matter. The leases underlying the properties in dispute
have been allowed to lapse by the Company, giving the Company no further
rights in them. The potential monetary liability to the Company if found
liable to the Plaintiffs is unknown at the current time.


Note 3. Contingencies

A new Board of Directors for the Company was appointed by court order in
April, 2002. The new Board, although unaware of any undisclosed actions by
the previous Board that would materially affect these financial statements,
has not had complete access to certain Board minutes and Company contract
documentation that could reveal material items to which the Company
is a party.

The Company's new Board of Directors is reviewing the circumstances behind
the issuance of up to 5,000,000 of the 19,711,900 common shares issued by
the Company in 2001. Up to 5,000,000 of these shares could be canceled if
determined by the Board to have been inappropriately issued. As the shares
were issued for no known consideration, cancellation would have no material
impact on the financial statements except for earnings per share.



<PAGE>                         5

                      CHANCELLOR GROUP, INC.
                Supplemental Information (Unaudited)

                    Period Ended March 31, 2002

Capitalized Costs Relating to Oil and Gas
Producing Activities at March 31, 2002
------------------------------------------

Unproved oil and gas properties          $         -
Proved oil and gas properties                      -
Support equipment and facilities                   -
                                         -----------
                                                   -
Less accumulated depreciation,
depletion, amortization, and
impairment                                (        -)
                                         -----------
Net capitalized costs                    $         -
                                         ===========


Costs Incurred in Oil and Gas Producing
Activities for the Period
Ended March 31, 2002
---------------------------------------

Property acquisition costs
     Proved                              $         -
     Unproved                                      -
Exploration costs                                  -
Development costs                                  -


Results of Operations for Oil and Gas Producing
Activities for the Period Ended March 31, 2002
-------------------------------------------------

Oil and gas sales                        $         -
Gain on sale of oil and gas properties             -
Gain on sale of oil and gas leases                 -
Production costs                                   -
Exploration expenses                               -
Depreciation, depletion,
  and amortization                                 -
                                         -----------
                                                   -
Income tax expense                                 -
                                         -----------
Results of operations for oil and gas
  producing activities (excluding
  corporate overhead and financing
  costs)                                 $         -
                                         ===========


Reserve Information

     The following estimates of proved and proved developed reserve
quantities and related standardized measure of discounted net cash flow
are estimates only, and do not purport to reflect realizable values or
fair market values of the Company's reserves. The Company emphasizes that
reserve estimates are inherently imprecise and that estimates of new
discoveries are more imprecise than those of producing oil and gas
properties. Accordingly, these estimates are expected to change as future
information becomes available. All of the Company's reserves are located
in the United States.
     Proved reserves are estimated reserves of crude oil (including
condensate and natural gas liquids) and natural gas that geological and
engineering data demonstrate with reasonable certainty to be recoverable
in future years from known reservoirs under existing economic and operating
conditions. Proved developed reserves are those expected to be recovered
through existing wells, equipment, and operating methods.
     The standardized measure of discounted future net cash flows is
computed by applying year end prices of oil and gas (with consideration of
price changes only to the extent provided by contractual arrangements)
to the estimated future production of proved oil and gas reserves, less
estimated future expenditures (based on year end costs) to be incurred in
developing and producing the proved reserves, less estimated future income
tax expenses (based on year end statutory tax rates, with consideration of
future tax rates already legislated) to be incurred on pretax net cash flows
less tax basis of the properties and available credit, and assuming
continuation of existing economic conditions. The estimated future net cash
flows are then discounted using a rate of 10 percent a year to reflect
the estimated timing of the future cash flows.

<PAGE>                                 6

                        CHANCELLOR GROUP, INC.
           Supplemental Information (Unaudited) - Continued
                      Period Ended March 31, 2002

Reserve Information
-------------------
                                                Oil            Gas
                                               (Bbls)         (Bcf)
                                               ------         ------
Proved developed and undeveloped reserves
     Beginning of period                            -              -
     Revisions of previous estimates                -              -
     Improved recovery                              -              -
     Purchases of minerals in place                 -              -
     Extensions and discoveries                     -              -
     Production                                     -              -
     Sales of minerals in place                     -              -
                                              -------        -------
     End of period                                  -              -
                                              =======        =======
Proved developed reserves
     Beginning of period                            -              -
     End of period                                  -              -

Standardized Measure of Discounted Future
     Net Cash Flows at March 31, 2002

     Future cash inflows                               $
     Future production costs
     Future development costs
     Future income tax expenses
                                                        -------------

     Future net cash flows (10% annual discount for
         estimated timing of cash flows)
                                                        -------------
Standardized measures of discounted future net cash
     flows relating to proved oil and gas reserves      $
                                                        =============

The following reconciles the change in the standardized measure of
discounted future net cash flow during the three months
ended March 31, 2002.

Beginning of period                                     $
Sales of oil and gas produced, net of production costs         (   xx)
Net changes in prices and production costs                     (   xx)
Extensions, discoveries, and improved recovery,
   less related costs                                              xx
Development costs incurred during the period which
   were previously estimated                                       xx
Net change in estimated future development costs                   xx
Revisions of previous quantity estimates                       (   xx)
Net change from purchases and sales of minerals in place       (   xx)
Accretion of discount                                              xx
Net change in income taxes                                     (   xx)
Other                                                          (   xx)
                                                        -------------
End of period                                           $
                                                        =============

<PAGE>                                  7


                       CHANCELLOR GROUP, INC.

ITEM 2.  Management's Discussion and Analysis or Plan of
         Operation

Chancellor Group, Inc. (formerly Nighthawk Capital, Inc.)("Nighthawk",
the "Company", the "Registrant") was organized under the laws of the state
of Utah in 1986 and subsequently reorganized under the laws of Nevada in 1993.
In July 1995, the Company acquired all of the issued capital of two Kentucky
based operations, Delstar Gas Systems, Inc. ("DGS") and Northstar Gas Systems,
Inc. ("NGS"), covering gas reserves, and gas transmission systems, respectively.
In December, 1995, the Company formed a wholly owned subsidiary in the state
of Kentucky, Delstar Resources, Inc. ("DRI"), which acquired
additional freehold lands and gas reserves for $5,425,000. On August 1, 1996,
the Company completed the spinoff of its wholly owned subsidiary,
Chancellor Australia Pty. Ltd., which contained all of the non-energy
operations and assets of the group. In September, 1997 the Company acquired
100% ownership of Radly Petroleum, Inc. ("Radly"), a Texas corporation, in
exchange for approximately 80% of the Company's outstanding common stock. In
July, 1998 the Company acquired 100% ownership in Lichfield Petroleum
America, Inc., ("Lichfield") a Texas corporation. In October of 2000,
the Company acquired 100% ownership of Getty Petroleum, Inc. ("Getty") in
exchange for 4,500,000 shares of restricted common stock. Chancellor Group,
Inc., Getty, Radly, Lichfield, DGS, NGS, and DRI remain as separate legal
entities and and operate as separate legal entities. The Company has taken an
impairment writedown in connection with DGS, NGS, and DRI until such time as
certain disputes between the Company and the original owners of DGS and NGS are
resolved.


Results of Operations

In the fourth quarter of 2001, the Company took a full amortization write down
On its oil and gas properties in Pecos County, Texas, and wrote off its
fixed asset investment in the Shinkle Field in Kansas. The Company's new Board
of Directors is currently seeking viable opportunities in the oil and gas
business, primarily in the areas of acquisition and development of producing
properties. The Company's activities in the first quarter of 2002 were limited
due to legal proceedings leading to the replacement of the Company's
former Board.

<PAGE>	                               	8


PART II.  OTHER INFORMATION


Item 1.	Legal Proceedings

A shareholder derivative action brought against the Company because of
its then CEO, Shane Xavier Gabriel Rodgers resulted in the District Court of
Clark County, Nevada placing the Company into receivership in October, 2001.
The receivership was subsequently lifted and on April 5, 2002 Rodgers was
fired from the Board of Directors for breaching his fiduciary duty and a new,
interim Board appointed while a shareholder meeting is held.

Chancellor Group, Inc. shareholders Lichfield Petroleum, Ltd. and Graham
Energy, Inc. also brought a legal action against Rodgers, Chancellor
Group, Inc. and Chancellor Group Inc.'s wholly owned subsidiary Getty
Petroleum, Inc. in Texas, but because Rodgers failed to enter a defense on
Chancellor Group, Inc.'s behalf, Chancellor Group, Inc. shareholders Axis
Network Pty, Ltd. and Koala Pictures Pty, Ltd. (who also initiated the
Nevada action) intervened to object on behalf of Chancellor Group, Inc.
Recent discussions have taken place between the plaintiffs' counsel,
Koala Pictures Pty, Ltd. and a Chancellor Group, Inc. Board member and
the Company is hopeful that the action may soon be dropped now that the
former CEO Rodgers is no longer on the Board.

Item 2.	Changes in Securities - None

Item 3.	Defaults Upon Senior Securities - None

Item 4.	Submission of Matters To A Vote of Securities Holders - None

Item 5.	Other Information - None

Item 6.	Exhibits and Reports on Form 8-K - None

<PAGE>                                 9


                         SIGNATURES

Pursuant to the requirements of Section 12(g) the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized,
on May 15th, 2002.

CHANCELLOR GROUP, INC.

By: /s/Dudley Muth
Dudley Muth
Interim court appointed Director

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 in the capacities indicated, on May 15th, 2002.

Director:

/s/Dudley Muth
Dudley Muth




<PAGE>