UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549



                                  FORM 10-QSB


(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934  (FEE REQUIRED)


                  For the Quarterly Period Ended July 31, 2002


                        Commission file number: 0-21169


                    Imperial Petroleum Recovery Corporation
             (Exact name of registrant as specified in its charter)


              Nevada                                  76-0529110
(State or other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                     Identification No.)



                          1970 South Starpoint Drive
                              Houston, TX 77032
              (Address of principal executive offices)(Zip Code)


                               (281) 821-1110
             (Registrant's telephone number, including area code)


Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 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


There were 17,167,419 shares of the Registrant's $0.001 par value common stock
outstanding as of September 24, 2002.













                              TABLE OF CONTENTS

                         PART I. FINANCIAL INFORMATION

Item 1.     Consolidated Financial Statements (Unaudited)

            Consolidated Balance Sheets as of July 31, 2002
            and October 31, 2001 ....................................    3-4

            Consolidated Statements of Operations for the Three
            and Nine Months Ended July 31, 2002 and 2001 and
            Cumulative Amounts Since Inception ......................      5

            Consolidated Statements of Cash Flows for the Nine
            Months Ended July 31, 2002 and 2001 and Cumulative
            Amounts Since Inception .................................    6-8

            Notes to Consolidated Financial Statements ..............   9-15

Item 2.     Management's Discussion and Analysis of Financial
            Condition and Results of Operations .....................  16-18

PART II. OTHER INFORMATION

Item 1.     Legal Proceedings .......................................     19

Item 2.     Changes in Securities and Use of Proceeds ...............     19

Item 3.     Defaults Upon Senior Securities .........................     19

Item 4.     Submission of Matters to a Vote of Security Holders .....     19

Item 5.     Other Information .......................................     19

Item 6.     Exhibits and Reports on Form 8-K ........................     19

Signatures  .........................................................     20

Certifications ......................................................     21

Exhibit Index .......................................................     22

















                                       2



                       PART I.  FINANCIAL INFORMATION

ITEM I. CONSOLIDATED FINANCIAL STATEMENTS

IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

CONSOLIDATED BALANCE SHEETS

                                          July 31, 2002       October 31, 2001
                                          -------------       ----------------
                                           (Unaudited)            (Audited)

ASSETS

CURRENT ASSETS
  Cash and cash equivalents               $    256,412          $      1,660
  Trade accounts receivable, no allowance
   considered necessary                        236,991               118,496
  Other receivables, related parties           145,758                  -
  Inventory, net of reserve                       -                     -
  Prepaid expenses                               7,977                 8,991
                                          ------------          ------------
     Total current assets                      647,138               129,147

PROPERTY AND EQUIPMENT, net of
  accumulated depreciation of $472,869
  at July 31, 2002 and $399,644 at
  October 31, 2001 respectively                736,879               836,096



OTHER ASSETS, net of accumulated
  amortization of $7,977 at July 31, 2002
  and $7,414 at October 31, 2001,
  respectively                                  68,069                78,029
                                          ------------          ------------
                                          $  1,452,086          $  1,043,272
                                          ============          ============















The accompanying notes are an integral part of these financial statements.

                                  (Continued)

                                       3


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

CONSOLIDATED BALANCE SHEETS (Continued)

                                          July 31, 2002       October 31, 2001
                                          -------------       ----------------
                                           (Unaudited)            (Audited)

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITES
  Trade accounts payable                  $  1,171,766          $    914,791
  Other payables, related parties               15,589                45,869
  Accrued liabilities                          820,336               450,203
  Deferred revenue                             158,625                53,625
  Notes payable, related parties               863,494               900,115
  Bridge loan (Note E)                       1,002,486                  -
  Current maturities of long-term debt
   obligations                                  60,715               372,264
  Current maturities of capital lease
   obligations                                   2,094                 1,908
                                          ------------          ------------
     Total current liabilities               4,095,105             2,738,775

LONG TERM OBILGATIONS
  Debt obligations, less current
   maturities                                1,130,839             1,133,691
  Capital lease obligation, less current
   maturities                                    4,817                 6,262
                                          ------------          ------------
     Total liabilities                       5,230,761             3,878,728

Redeemable common stock, par value
  $0.001; redemption value of
  $2,000,000; 200,000 shares issued
  and outstanding                              156,198               113,315

STOCKHOLDERS' DEFICIT
  Common stock, par value $0.001;
   authorized 100,000,000 shares;
   issued and outstanding 16,967,419
   shares                                       16,968                16,968
  Additional paid in capital                11,430,777            11,430,777
  Deficit accumulated during the
   development stage                       (15,382,618)          (14,396,516)
                                          ------------          ------------
     Total stockholders' deficit            (3,934,873)           (2,948,771)
                                          ------------          ------------
                                          $  1,452,086          $  1,043,272
                                          ============          ============





The accompanying notes are an integral part of these financial statements.

                                         4



IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
<TABLE>
<CAPTION>

                               Cumulative
                                Amounts            For the three               For the nine
                                 Since          months ended July 31,       months ended July 31,
                               Inception         2002          2001          2002         2001
                              ------------    ----------    ----------    ----------    -----------
<S>                           <C>             <C>           <C>           <C>           <C>
Revenues                      $  1,807,430    $  445,221    $   82,089    $  844,864    $   324,904
Cost of goods sold              (2,385,921)     (286,791)     (129,633)     (535,717)      (694,213)
                              ------------    ----------    ----------    ----------    -----------
   Gross profit (loss)            (578,491)      158,430       (47,544)      309,147       (369,309)

Operating expenses

 Selling, general and
  administrative                10,290,252       391,956       295,338    1,014,772       1,191,160

 Research and development-
  Prototype                      3,439,265          -           22,257         -             67,793
 Acquired research and
  development-prototype            349,500          -             -            -               -
 Loss on abandonment of
  leased facility                  161,918          -             -            -               -
                              ------------    ----------    ----------    ----------    -----------
                                14,240,935       391,956       317,595     1,014,772      1,258,953
                              ------------    ----------    ----------    ----------    -----------

Loss from operations           (14,819,426)     (233,526)     (365,139)     (705,625)    (1,628,262)

Other income (expense)
 Gain on extinguishment
  of debt                          396,961          -             -           38,710           -
 Interest expense                 (750,717)     (106,821)      (70,061)     (288,805)      (157,125)
 Interest expense on bene-
  ficial conversion feature        (13,250)         -          (13,250)         -           (13,250)
 Other income (expense), net      (139,989)         -             -           12,500         (1,323)
                              ------------    ----------    ----------    ----------    -----------
Total other income (expense),
 net                              (506,995)     (106,821)      (83,311)     (237,595)      (171,698)
                              ------------    ----------    ----------    ----------    -----------

   Net loss                   $(15,326,421)   $ (340,347)   $ (448,450)   $ (943,219)   $(1,799,960)
                              ============    ==========    ==========    ==========    ===========

Net loss per common share-
 basic and diluted

   Net loss                      $(1.17)       $(0.02)       $(0.03)        $(0.05)       $(0.11)
                                 ------        ------        ------         ------        ------

Weighted average common shares
 outstanding  - basic and
 diluted                        13,109,139    17,167,419    16,969,158    17,167,419     16,908,824
                              ------------    ----------    ----------    ----------    -----------

The accompanying notes are an integral part of these financial statements
</TABLE>

                                       5


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
<TABLE>
<CAPTION>

                                                         Cumulative
                                                           Amounts
                                                           Since        Nine months ended July 31,
                                                         Inception         2002           2001
                                                        ------------    -----------    -----------
<S>                                                     <C>             <C>            <C>
Increase (decrease) in cash and Cash equivalents
 Cash flows from operating Activities
  Net loss                                              $(15,326,421)   $  (943,220)   $(1,799,960)
  Adjustments to reconcile net loss to net cash
   used in operating activities
    (Gain) loss on disposal of property & equipment            2,561        (12,500)         1,323
    Contributed capital for services rendered
     and liabilities paid                                    131,756           -            35,170
    Gain on extinguishment of debt                          (396,961)       (38,710)          -
    Depreciation and amortization                            523,692        115,901        128,681
    Non-cash charge associated with acquisition              349,500           -              -
    Loss on abandonment of leased facility                   161,918           -              -
    Charges associated with stock issuances to
     employees, vendors, and related parties               1,061,800           -            12,031
    Non-cash expenses incurred by affiliate                  661,677           -              -
    Non-cash interest expense on beneficial conversion
     feature on note payable to related party                 13,250           -            13,250
    Changes in assets and liabilities
     Trade accounts receivable                              (236,991)      (118,495)           515
     Other receivables, related party                       (145,758)      (145,758)           750
     Prepaid expenses                                         (7,977)         1,014          9,644
     Other assets                                            (84,076)         7,332        (94,102)
     Trade accounts payable                                2,213,159        256,976        198,686
     Other payables, related parties                          15,589        (30,280)        11,632
     Accrued liabilities                                     843,124        383,843         86,347
     Deferred revenue                                        158,625        105,000           (247)
                                                        ------------    -----------    -----------
 Total adjustments                                         5,264,888        524,323        403,680
                                                        ------------    -----------    -----------
     Net cash used in operating activities               (10,061,533)      (418,897)    (1,396,280)

Cash flows from investing activities
 Cash paid for acquisition                                   (94,000)          -              -
 Purchases of property and equipment                      (1,256,518)       (14,056)       (84,421)
 Proceeds from disposal of property and equipment             12,500         12,500           -
                                                        ------------    -----------    -----------
     Net cash provided by (used in) investing
      activities                                          (1,338,018)        (1,556)       (84,421)

                                             (Continued)

The accompanying notes are an integral part of these financial statements.


                                                 6

</TABLE>







IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - Continued
<TABLE>
<CAPTION>

                                                         Cumulative
                                                           Amounts
                                                           Since        Nine months ended July 31,
                                                         Inception         2002           2001
                                                        ------------    -----------    -----------
<S>                                                     <C>             <C>            <C>
Cash flows from financing activities
  Proceeds from issuance of common stock and warrants      6,667,983           -           157,500
  Proceeds from issuance of notes payable, related
   parties                                                 1,428,744         21,379        826,200
  Principal payments on notes payable, related parties      (296,514)       (58,000)          -
  Proceeds from issuance of bridge loan                    1,002,486      1,002,486           -
  Proceeds from issuance of long term obligations          3,640,377           -           467,250
  Principal payments on long term obligations               (596,860)        (2,852)      (133,222)
  Principal payments on short term obligations              (286,549)      (286,549)          -
  Proceeds from guaranteed investment contract               100,000           -              -
  Principal payments on capital lease obligations             (3,704)        (1,259)        (1,257)
                                                        ------------    -----------    -----------
     Net cash provided by financing activities            11,655,963        675,205      1,316,471
                                                        ------------    -----------    -----------

     Net increase (decrease) in cash and
      cash equivalents                                       256,412        254,752       (164,230)

Cash and cash equivalents at beginning of period                -             1,660        171,822
                                                        ------------    -----------    -----------
Cash and cash equivalents at end of period              $    256,412    $   256,412    $     7,592
                                                        ------------    -----------    -----------

Supplemental disclosure of cash flow information
  Cash paid during the period for interest              $    381,171    $    16,877    $    54,168
                                                        ------------    -----------    -----------
  Income taxes                                          $       -       $      -       $      -
                                                        ------------    -----------    -----------



                                            (Continued)

</TABLE>















The accompanying notes are an integral part of these financial statements.

                                       7


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)- Continued

Noncash investing and financing activities

The following noncash activities occurred during the nine month period ended
July 31:

2002
----
The Company incurred a charge to accumulated deficit of $42,883, for the
accretion in value on redeemable common stock.

In the nine month period of 2002, the Company paid $75,000 in full settlement
of $100,000 in outstanding debt and $13,710 in accrued interest.  As a result
of this settlement, the Company recorded a gain on extinguishment of debt of
$38,710. The remainder of the note and accrued interest were forgiven by the
debt holder.

The Company sold $40,048 of fully depreciated property and equipment for
proceeds of $12,500.

2001
----
In December 2000, the Company issued 16,040 shares of its Common Stock to
various employees as bonuses for the fiscal year 2000.  The bonuses totaled
approximately $12,030.

In December 2000, the Company issued 182,936 shares of Common Stock to a
related party and stockholder in satisfaction of a 10% note payable in the
amount of $50,033 plus accrued interest of $6,677.  The Company recognized
charges related to the beneficial conversion feature on this note payable to
the related party.  The beneficial conversion feature is determined by the
difference between the market value of common stock and the conversion rate of
the debt, limited to the amount of debt.  The beneficial conversion feature is
recognized as interest expense over the period corresponding to the time
restrictions on conversion of the debt into stock.  For the nine months ended
July 31, 2001 and for the period cumulative from inception, the beneficial
conversion resulted in a noncash charge recorded as additional interest
expense of $13,250.















The accompanying notes are an integral part of these financial statements.

                                      8


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTNG POLICIES

1.   Basis of Presentation

The consolidated financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America for
interim financial information and pursuant to the regulations of the
Securities and Exchange Commission; accordingly they do not include all of the
information and notes required by accounting principles generally accepted in
the United States of America for complete financial statements.  In the
opinion of management, all adjustments considered necessary for a fair
presentation (consisting of normal recurring accruals) have been included.
The results of operations for the nine-month period ended July 31, 2002 are
not necessarily indicative of the results for the fiscal year ending October
31, 2002.  The accompanying unaudited consolidated financial statements should
be read in conjunction with the consolidated financial statements and notes
thereto included in the Company's Annual Report on Form 10-KSB for the fiscal
year ended October 31, 2001.

2.   Organization and business activity

Imperial Petroleum Recovery Corporation and Subsidiary (a development stage
company incorporated in Nevada) (the "Company") has been in the development
stage since commencement of operations in fiscal year 1995 and is committed to
developing and marketing a proprietary oil sludge remediation process and
equipment (MST units) that use high energy microwaves to separate water, oil
and solids. Company operations take place in Houston, Texas.

3.   Principles of consolidation and financial statement presentation

The consolidated financial statements include the accounts and operations of
the Company and its wholly owned subsidiary, Petrowave Corporation.
Significant intercompany transactions and balances have been eliminated in the
consolidation.

4.   Inventories

Inventory is valued at lower of cost or market.  Cost is determined using the
first-in, first-out method.  Inventory consists of the following:

                                         July 31, 2002     October 31, 2001
                                         -------------     ----------------
     Raw materials                         $260,000           $260,000
     Less reserve for net realizable
      value                                (260,000)          (260,000)
                                           --------           --------
     Total                                 $   -              $   -
                                           ========           ========

The recoverability of inventory is dependent upon the Company entering into
agreements to lease the completed MST units.



                                       9


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTNG POLICIES (Continued)

5.   Certain reclassifications

Certain balances from the 2001 financial statements were reclassified to
conform to the 2002 presentation.

6.   Revenue recognition   long term contracts

Revenue relating to contracts to construct crude oil sludge recovery equipment
in the accompanying financial statements is recognized using the
percentage-of-completion method and, therefore, takes into account the costs,
estimated earnings and revenue to date on contracts not yet completed.  The
revenue recognized is that portion of the total contract price that cost
incurred to date bears to anticipated final total cost, based on current
estimates of cost to complete.

Contract costs include all direct and allocable indirect labor, benefits, and
materials unique to or installed in the project, subcontractor cost
allocations, including employee benefits and equipment expense.  At the time a
loss on a contract becomes known, the entire amount of the estimated ultimate
loss is recognized in the financial statements.  As long-term contracts extend
over one year, revisions in cost and earnings estimates during the course of
the work are reflected in the accounting period in which the facts that
require the revision become known.  Costs attributable to contract claims or
disputes are carried in the accompanying balance sheets only when realization
is probable.  These costs are recorded at the lesser of actual costs incurred
or expected amount realized.  It is reasonably possible that estimates by
management related to contracts can change in the future.

Other revenue recognition

Revenue consists of lease and / or sale of MST units, demonstration income for
testing the technology at a customer site, or license revenue earned from
issuing geographically specific licenses to market the MST technology.

Revenue on lease or rental equipment contracts is recognized straight line
over the life of the contract according to contract terms, which generally
consists of a monthly lease or rental fee and a monthly maintenance fee.

Revenues associated with the demonstration units are earned based upon
individual contracts negotiated by the Company on a case-by-case basis.  The
Company did not earn revenues from demonstrations during the nine months ended
July 31, 2002.

The Company can earn license fees and royalty revenue through the issuance of
contractual licenses.  License fees are recognized over the life of the
contractual license and royalties are based on the terms of the royalty
contact.




                                       10

          
<PAGE>
IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

NOTE B - GOING CONCERN

The accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America for
interim financial information, which contemplates continuation of the Company
as a going concern.  The Company is in the development stage in which it has a
limited amount of resources due to small amounts of capital.  The Company
believes its technology will continue to develop and provide sufficient
resources and revenues to meet the Company's expectations. The Company has
incurred substantial losses from operations since inception.  In addition, as
of July 31, 2002, its current liabilities exceeded its current assets by
$3,447,967.  The Company expects to overcome its losses from prior years and
believes its efforts and technology will prove successful.

In view of the matters described in the preceding paragraph, recoverability of
a major portion of the recorded asset amounts shown in the accompanying
consolidated balance sheet is dependent upon continued operations of the
Company which in turn is dependent upon the Company's ability to meet its
financing requirements on a continuing basis, to obtain additional financing
and to succeed in its future operations.  The financial statements do not
include any adjustments relating to the recoverability and classification of
recorded asset amounts or amounts and classification of liabilities.

The Company has taken the following steps to revise its operating and
financial requirements, which it believes are sufficient to provide the
Company with the ability to continue in existence:

   * During late October 2001, the Company was introduced to Odyssey Capital
     LLC, a Houston organization noted for its ability to raise cash, develop
     Houston-based companies, and promote oil-related opportunities to
     investors familiar with the unique requirements of the oil patch.  A
     management and financing agreement is in place with Odyssey Capital, LLC
     to rise between five million and six million dollars in operating capital
     and to identify experienced petroleum industry executives to develop the
     Company's long term growth.

   * During fiscal year 2001, the Company entered into an agreement with
     ExxonMobil to sell a MST-1000 to a refinery located in Africa.  The
     Company will use the percentage of completion method to recognize the
     revenue. As of July 31, 2002, the Company has recognized 57 percent of
     the contract to date.  The Company expects the customer to take delivery
     during the fourth quarter of fiscal year 2002, at which time 85% of the
     contract will be billed. The balance will be billed upon installation
     and initial operation in Africa.

   * The Company entered an agreement with Tradewinds Oil and Gas Inc., a
     Houston based company, an entity in which a Board member has an equity
     investment and serves as a financial advisor, to market and license the
     MST technology for distribution throughout Indonesia and Singapore. The
     Company will receive a license fee covering the first two years of this
     agreement.  Additional revenue will be earned by the Company based upon
     orders received for equipment to be delivered to Indonesia and on a
     revenue sharing formula included in this agreement.

                                       11


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

NOTE B - GOING CONCERN (Continued)

   * The Company has entered into discussions with Ondeo Nalco to utilize
     their marketing and technical resources to place MST units within their
     client base.  The Company anticipates developing this relationship to
     provide a significant external marketing effort for the lease and / or
     sale of MST units.

NOTE C - LOSS PER COMMON SHARE

The following data show the shares used in computing net loss per common
share:
<TABLE>
<CAPTION>
                              Cumulative
                               Amounts          Three Months             Nine Months
                                Since           ended July 31,            ended July 31,
                              Inception       2002         2001         2002         2001
                              ----------   ----------   ----------   ----------   ----------
<S>                           <C>          <C>          <C>          <C>          <C>
Common shares outstanding           -      17,167,419   16,947,419   17,167,419   16,700,943
 during the entire period
Weighted average common
 shares issued during the
 period                       13,109,139         -          21,739         -         207,881
                              ----------   ----------   ----------   ----------   ----------
Weighted average common
 shares outstanding -
 basic and diluted            13,109,139   17,167,419   16,969,158   17,167,419   16,908,824
                              ----------   ----------   ----------   ----------   ----------
</TABLE>

All shares relating to all outstanding options, warrants and potentially
convertible debt instruments as disclosed in Notes E and I of the Form
10K-SB/A at October 31, 2001, were not included in the computation of diluted
loss per share because their inclusion would have been antidilutive for all
periods.

















                                       12



IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

NOTE D - RELATED PARTY TRANSACTIONS

During the quarter ended July 31, 2002, the Company has increased its notes
payable to stockholders.

Warrants

At various dates during 1997 and 1998, the Company issued 11,375,000 warrants
to a limited liability company (LLC) to purchase shares of its common stock.
The initial exercise price of all of the LLC warrants was $1 per share and
each warrant expires four years after the grant date.  3,500,000 warrants
expired during the quarter ended January 31, 2002.  Another 3,500,000 warrants
expired on March 15, 2002.  An additional 3,500,000 warrants expired on, July
1, 2002 with the remaining 875,000 warrants expiring on December 10, 2002.

NOTES E - BRIDGE LOAN

During March of 2002, the Company received $271,837 in proceeds from a
temporary loan from an investor, with an interest rate of 12 percent, to
provide cashflow until the debt financing under a private placement started in
March of 2002 with Odyssey Capital LLC could be completed.  The temporary loan
was rolled into the private placement prior to its closing.  The current
balance of the bridge loan as of July 31, 2002 is $1,002,486.

During May of 2002, a financing source on behalf of the Company completed the
minimum funding requirement under the $2,000,000 private placement with
Odyssey Capital.  The bridge loans are secured promissory notes bearing
interest at 12 percent, maturing December 16, 2002.  The debt instruments are
convertible at the option of the holder to $.001 par value common stock at
$.20 per share (trading price during March of 2002).  In the event of default,
the interest rate on the debt increases to the maximum allowed by law in Texas
(18 percent).





















                                       13


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTES F - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements
No. 4, 44, and 64 Amendment of FASB Statement No. 13, and Technical
Corrections".  SFAS No.145 rescinds Statement 4, which required all gains and
losses from extinguishment of debt to be aggregated and, if material,
classified as an extraordinary item, net of related income tax effect.  Since
the issuance of Statement 4, the use of debt extinguishment has become part of
the risk management strategy of many companies, including the Company.  These
debt extinguishments do not meet the criteria for classifications as
extraordinary items in APB Opinion No. 30, Reporting the Results of Operations
- Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions, and
therefore, should not be classified as extraordinary after the adoption of
SFAS No. 145. Adoption of SFAS No. 145 is required for fiscal years beginning
after May 15, 2002, but earlier application is encouraged.  The Company
elected to adopt the provisions of SFAS No. 145 during the quarter ended April
30, 2002. The gain on extinguishment of debt totaling $38,710 for the nine
month period ended July 31, 2002 and the cumulative amounts since inception of
$396,961 previously reported as extraordinary have been reclassified to and
included in other income.































                                       14


IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

This portion of the Form 10-QSB contains "forward-looking statements" within
the meaning of the federal securities laws, including statements concerning
anticipated revenues, future marketing plans for the MST-1000, and similar
statements concerning anticipated future events and expectations that are not
historical facts.  The forward-looking statements in this portion of the Form
10-QSB are subject to numerous risks and uncertainties, including the effects
of economic conditions; the availability of capital; the dependence on key
customers; competitive conditions; and the various risks associated with
developing and marketing a new process/technology which could cause actual
results to differ materially from those expressed in or implied by such
forward-looking statements, which speak only as of the date hereof.  Readers
should also refer to the Company's Annual Report on Form 10-KSB for the fiscal
year ended October 31, 2001.

Overview

During the third quarter of 2002, the Company was focusing on four areas:
capitalization, technology improvement, marketing, and manufacturing.

Management has worked to improve our cash position and to develop sources of
long-term capitalization.  During late October 2001, management was introduced
to a Houston organization, Odyssey Capital LLC., noted for its ability to
raise cash, develop Houston-based companies, and promote oil-related
opportunities to investors familiar with the unique requirements of the oil
patch.  Management has a high degree of confidence in the ability of this
organization to provide the sources of funds to take advantage of
opportunities for growth in fiscal year 2002. (See Note B to consolidated
financial statements).

The Company and ExxonMobil Research and Engineering (EMRE) concluded the
exclusive marketing agreement granted EMRE through October 2001.  The Company
and EMRE will continue to discuss and seek potential MST applications within
the ExxonMobil organization.

Additionally, several series of tests were conducted under the joint
observation of the Company and Ondeo Nalco, a world leader in water treatment
and process chemicals, to evaluate the effectiveness of the MST compared to
applications of chemicals on various types of emulsions.  Discussions and
additional testing continue between the Company and Ondeo Nalco.  The Company
is working with Ondeo Nalco to provide a world wide marketing agreement.  Both
organizations, have participated in joint marketing efforts for the MST.









                                   Continued

                                       15



IMPERIAL PETROLEUM RECOVERY CORPORATION and SUBSIDIARY
(a development stage company)

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS - CONTINUED

The Company issued an exclusive license to Tradewinds Oil and Gas Inc., an
entity in which a Board member has an equity investment and serves as a
financial advisor, for marketing the MST in Singapore and Indonesia.  During
the third quarter of fiscal year 2002, Tradewinds immediately scheduled an
extensive series of meetings with management in Pertamina and refineries
throughout Singapore and Indonesia.  Tradewinds and the Company have also set
up meetings with marketing and technical groups to help them solve their
emulsion problems.

The Company markets its products primarily for the purpose of remediation of
crude oil emulsions produced in connection with oil production and refining.
There are approximately 694 oil refineries worldwide with 111 of these located
in the United States.  Each is a potential customer of the Company.
Twenty-five of these refineries have been identified as high potential users
for the MST process and are being targeted by our marketing team.

Ondeo Nalco and the Company entered into discussions during the last quarter
of calendar year 2001 concerning developing a marketing relationship.  The
discussions continue into fiscal year 2002, with the direction centered on
partnering with Ondeo Nalco to utilize their marketing organization to
introduce the MST to their client base.  The Company concluded its exclusive
marketing relationship with ExxonMobil, but they will continue to market the
MST to their internal operations, while completing a series of technical
evaluations.

The Company granted an exclusive geographically specific marketing and
licensing agreement to Tradewinds Oil and Gas Inc., an entity in which a Board
member has an equity investment and serves as a financial advisor.  The
Company will be responsible for making or having made the microwave separation
technology equipment for each order placed.  License payments have been
received for this agreement.  (See Note B to consolidated financial
statements).

In July 2001, Kellogg Brown & Root (KBR) awarded the Company the contract to
build and deliver its Microwave Separation Technology system (MST 1000) for a
Bad Emulsion Treatment Package to be installed in their African construction
project.  This unit is under construction in Houston and progress payments
from KBR have been received.  The Company recognized $348,871 in revenue
received from KBR for the quarter ended July 31, 2002.  This unit is IPRC's
second commercial system and reflects the slow, but deliberate acceptance of
the microwave technology for emulsion separation within the petroleum and gas
industry.  (See Note B to consolidated financial statements).











                                       16

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS - CONTINUED

Results of Operations

Three months ended July 31, 2002 compared to three months ended July 31, 2001.
Also, the nine months ended July 31, 2002 compared to nine months ended July
31, 2001.

Revenue

The Company increased their revenue in the third quarter for the three months
ended from $82,089 in 2001 to $445,221 in the same period in 2002. Revenue
recognized during the three-month period ended July 31, 2002 on the long-term
contract for the Esso Chad Bad Emulsion Treatment Package project (Esso Chad
project) accounted for $348,871 of the increase.  The Company recognized lease
revenue from its MST unit in Torrance, California of $81,250 compared to
$82,089 from the period ended July 31, 2001.  The Company also recognized
revenue from licenses fees of $15,000 from the Tradewinds marketing agreement
during the three month ended July 31, 2002. (None in 2001).

Revenue for the nine-month period ended July 31, 2002 of $844,864 increased by
$519,960 from the comparable nine-month period ended July 31, 2001, which had
$324,904 of revenues.  The increase is attributable to the $568,614 in revenue
recognized on the long-term contract from the Esso Chad Project and $17,500 in
consulting fees and lease revenue for the nine months ended July 31, 2002.
Also, during the nine-months ended July 31, 2002 the Company had $243,750 of
MST lease revenue and had license revenue of $15,000 from the Tradewinds
marketing agreement.

Cost of Goods Sold and Gross Profit (Loss)

During the three-month period ended July 31, 2002, the Company experienced an
increase of $157,158 in cost of goods sold to $286,791 for the period ended
July 31, 2002 from $129,633 during the same period ended in 2001.  Cost of
goods sold for the three-month period ended July 31, 2002 consisted of
$286,536 in costs specifically related to the revenue recognized on the
long-term contract on the Esso Chad project and also had costs of $255 for
work on the MST unit in Torrance, California.  Cost of goods sold incurred
during the comparable period ended July 31, 2001 was related to the leased MST
unit maintenance and MST unit demonstration.

The Company decreased total cost of good sold by $158,496 for the nine-month
period ended July 31, 2002, which had costs of $535,717 compared to $694,213
for the same period during 2001. In the nine month period ended July 31, 2002
the Company had costs of $465,386 from the Esso Chad Project and $52,840 from
equipment rental. The Company incurred costs of $17,236 from the ExxonMobil
unit and had comparable to costs of $258,973 for the nine month period ended
July 31, 2001.  In comparison with the nine month period ended July 31, 2001
the Company had decreases achieved by (1) equipment costs related to
maintaining the MST unit under lease with ExxonMobil incurred during the
nine-months (2) reducing salaries and leased employee costs for maintaining
the ExxonMobil unit (3) depreciation expense for lease equipment (4)
decreasing expenditures on repair and maintenance of equipment and (5)
equipment rental costs.


                                       17



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS - CONTINUED

Cost of Goods Sold and Gross Profit (Loss) - Continued

For the three and nine-month periods ended July 31, 2002, the Company
experienced a gross profit of $158,430 and $309,146 respectively, compared to
a gross loss of $(47,544) and $(369,309) respectively, for the comparable
periods ended July 31, 2001.  The improvement in the Company's gross profit
was primarily the result of the revenue from the Chad Project.  In addition,
the Company did not incur the costs for demonstrations and MST lease unit
maintenance incurred during the nine-month ended July 31, 2001, which
significantly exceeded the amount of lease and demonstration revenue
recognized for the period.

Selling, General and Administrative

Selling, general, and administrative expenses for the three-month and
nine-month periods ended July 31, 2002 totaled $391,956 and $1,014,772,
respectively compared to $295,338 and $1,191,160 for same periods in 2001.
This created an increase of $96,618 for the three month period and a decrease
of $176,438 for the nine month period in selling, general and administrative
costs.  This was primarily comprised of management fees of $64,548, legal fees
of $84,348 and salaries of $129,998.

Research and Development Expenses

The Company incurred no research and development costs for the three and
nine-month periods ended July 31, 2002 compared to $22,257 and $67,793 in the
three and nine-month periods ended 2001.

Liquidity and Capital Resources

The Company's operations have been capital intensive.  The Company has funded
operations principally from the private placement of equity securities,
primarily common stock, proceeds from short and long term debt and from a
licensing agreement.  As of July 31, 2002, the Company's current liabilities
were $4,095,105 compared to $2,738,775 at October 31, 2001. At July 31, 2002,
the Company had negative working capital of $3,447,967 compared to negative
working capital of $2,609,628 at October 31, 2001.

The Company continues to use cash in, rather than supply cash from, its
operations.  Its goal is to continue funding operations by raising money for
its working capital through debt and equity transactions arranged by Odyssey
Capital, establishing a strong marketing support structure through the
relationship with Ondeo Nalco, and issuing selective overseas territorial
licensing arrangements to generate cash flow.  Management believes that
Odyssey Capital will be successful in identifying accredited sources for
raising the proposed investment dollars.  The plan involves a combination of
short term financing (bridge loan) followed by issuance of preferred stock to
the investors.  However, there can be no assurances that sufficient funds can
be raised to continue operations or that any sales of common or preferred
stock will occur, or if they occur that they would be completed on terms
favorable to the Company.




                                       18


                          PART II.   OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

The Company has settled through mediation the claim against the Company
brought by a former employee and previously reported in the Company's Form
10-KSB for the year ended October 31, 2001.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

There were no changes in equity securities between October 31, 2001 and July
31, 2002.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5.  OTHER INFORMATION

None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits

           3.1     Articles of Incorporation of the Company (incorporated by
                   reference to Exhibits 2 and 2.1 to the Company's
                   Registration Statement on Form 10- KSB filed with the
                   Commission with a filing date of August 8, 1996,
                   Commission file No. 0-21169).

           3.2     Bylaws Company (incorporated by reference to Exhibit 3.2
                   to the Company's Annual Report on Form 10-KSB for the
                   fiscal year end October 31, 1996 filed with the Commission
                   with a filing date of November 26, 1997, commission File
                   No. 0-21169).

          10.1     Tradewinds Oil and Gas Inc., marketing and licensing
                   agreement for Singapore and  Indonesia, signed February 11,
                   2002 and effective May 1, 2002

         (99.1)    Certification of Chief Executive Officer Pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
                   Section 1350

         (99.2)    Certification of Chief Financial Officer Pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
                   Section 1350

The exhibits to this report are listed in the Exhibit Index, which appears
immediately after the signature page.

(b)  Reports on Form 8-K.   The Company did not file any reports on Form 8-K
during the quarter ended July 31, 2002.

                                     19



                                  SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized, on
September 24, 2002.

                                     IMPERIAL PETROLEUM RECOVERY CORPORATION




                                     By: /s/ Henry H. Kartchner
Date: September 24, 2002                 Henry H. Kartchner
                                         Chairman, Director
                                         (Duly Authorized Officer &
                                         Principal Financial Officer


                                  Certifications

Certification Pursuant to 18 U.S.C. Section 1350,

As Adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, C. Brent Kartchner. Certify that:

1.     I have reviewed this quarterly report on Form 10-QSB of Imperial
Petroleum Recovery Corporation.

2.     Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report; and

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of
Imperial Petroleum Recovery Corporation as of, and for, the periods presented
in this quarterly report.

Date: September 24, 2002               By: /s/ C. Brent Kartchner
                                          C. Brent Kartchner
                                          President and CEO

Certification Pursuant to 18 U.S.C. Section 1350,

As Adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Henry H. Kartchner. Certify that:

1.     I have reviewed this quarterly report on Form 10-QSB of Imperial
Petroleum Recovery Corporation.

2.     Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report; and

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of
Imperial Petroleum Recovery Corporation as of, and for, the periods presented
in this quarterly report.

          Date: September 24, 2002          By: /s/ Henry H. Kartchner
                                                Henry H. Kartchner
                                                Chairman, Director
                                                (Duly Authorized Officer &
                                                Principal Financial Officer)




















































                                 Exhibit Index

Exhibit No.   Identification of Exhibit


   3.1        Articles of Incorporation of the Company (incorporated by
              reference to Exhibits 2 and 2.1 to the Company's Registration
              Statement on Form 10- KSB filed with the Commission with a
              filing date of August 8, 1996, Commission file No. 0-21169).

   3.2        Bylaws Company (incorporated by reference to Exhibit 3.2 to the
              Company's Annual Report on Form 10-KSB for the fiscal year end
              October 31, 1996 filed with the Commission with a filing date of
              November 26, 1997, commission File No. 0-21169).

  10.1        Tradewinds Oil and Gas Inc., marketing and licensing agreement
              for Singapore and Indonesia, signed February 11, 2002 and
              effective May 1, 2002.

  99.1        Certification of Chief Executive Officer Pursuant to Section
              906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350

  99.2        Certification of Chief Financial Officer Pursuant to Section
              906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350