UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                   FORM 10-QSB

       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

                              EXCHANGE ACT OF 1934

                  For the Quarterly Period Ended April 30, 1997

                                       or


     // TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

               For the transition period from ________ to ________

                         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.)

           15311 Vantage Parkway West, Suite 160, Houston, Texas 77032
               (Address of principal executive offices) (Zip Code)

                                 (281) 987-2828
              (Registrant's telephone number, including area code)

                                 Not Applicable
                        (Former name, former address and
                             former fiscal year, if
                           changed since last report.)

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 periods that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days
                                  YES___ NO _X_


   The Number of Shares Of The Registrant's Common Stock, $.001 Par Value Per
            Share, Outstanding as of January 31, 1998 was 13,567,300

           Transitional Small Business Disclosure Format (check one):
                                  YES___ NO _X_


<PAGE>

                                TABLE OF CONTENTS

                          PART I. FINANCIAL INFORMATION

<TABLE>
<CAPTION>

<S>                                                                                                             <C>
Item 1. Financial Statements (Unaudited)

     Balance Sheets as of April 30, 1997 and October 31, 1996                                                     1-2

     Statements of Operations for the six months ended April 30, 1997 and 1996                                     3

     Statements of Stockholders' Deficit as of April 30, 1997                                                      4

     Statements of Cash Flows for the six months ended April 30, 1997 and 1996                                     5

     Note to Financial Statements                                                                                 6-7

Item 2. Management's Discussion and Analysis of Financial
     Condition and Results of Operations                                                                          8-9

                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings                                                                                        10

Item 2.  Changes in Securities and Use of Proceeds                                                                10

Item 3.  Defaults Upon Senior Securities                                                                          10

Item 4.  Submission of Matters to a Vote of Security Holders                                                      10

Item 5.  Other Information                                                                                        10

Item 6.  Exhibits and Reports on Form 8-K                                                                        10-11

Signatures                                                                                                        12

Exhibit Index                                                                                                     13

Financial Data Schedule                                                                                           14

</TABLE>



<PAGE>


Item 1.  Financial Statements

Imperial Petroleum Recovery Corporation
(a development stage company)

<TABLE>
<CAPTION>
Balance Sheets
==============================================================================================

                                                             April 30, 1997   October 31, 1996
----------------------------------------------------------------------------------------------
                                                               (Unaudited)        (Audited)

Assets

<S>                                                           <C>              <C>   
Current Assets
    Cash and cash equivalents                                   $   --           $   --
    Officer and employee advances                                 62,834          146,884
    Inventory                                                    132,000          132,000

                                                               -------------------------------

Total Current Assets                                             194,834          278,884

Property and equipment, net of accumulated depreciation
    of $3,362 as of April 30, 1997                               178,511          158,501

Other assets
    Intangible asset - Phonon Technology                         339,500          339,500

                                                               -------------------------------
                                                                $712,845         $776,885
----------------------------------------------------------------------------------------------
</TABLE>



                                                                               1
<PAGE>


Imperial Petroleum Recovery Corporation
(a development stage company)

<TABLE>
<CAPTION>
Balance Sheets--Continued
=================================================================================================

                                                                April 30, 1997   October 31, 1996
-------------------------------------------------------------------------------------------------
                                                                  (Unaudited)        (Audited)


Liabilities and Stockholders' Deficit

<S>                                                          <C>                  <C>
Current Liabilities
    Bank overdraft                                             $    50,720          $    51,934
    Note payable- Phonon acquisition- current portion                   --               20,000
    Notes payable, other                                            13,544                   --
    Accounts payable-trade                                         800,528              341,707
    Accounts payable-National Security Analysts, Inc.               84,615              138,638
    Accrued employee expense reimbursements                             --              124,542
    Current portion of  abandoned lease obligation                   2,618                2,618
                                                               ----------------------------------


Total Current Liabilities                                          952,025              679,439

Note Payable--FDC, related party                                   732,770              661,677

Note Payable--NSA, related party                                   291,009                   --

Note Payable--Phonon Technology                                    339,500              339,500

Accrued Lease Obligation--non-current                              100,000              100,000

Obligations to Be Settled in Stock
    Loans from affiliated entities                                      --            1,884,004
    Abandoned lease obligation                                          --               59,300
    Phonon acquisition                                              62,500               62,500

                                                               ----------------------------------

                                                                    62,500            2,005,804

Commitments and contingencies                                           --                   --

Stockholders' Deficit
    Common stock--authorized 100,000,000 shares; $.001
      par value; issued and outstanding 8,915,130 and
      8,315,080 shares at April 30, 1997 and
      October 31, 1996, respectively                                 8,915                8,315

    Common stock subscribed                                         (7,730)              (7,730)
    Additional paid-in capital                                   4,396,546            1,794,626
    Deficit accumulated during the development stage            (6,162,690)          (4,804,746)



Total Stockholders' Deficit                                     (1,764,959)          (3,009,535)

                                                               ----------------------------------

                                                               $   712,845          $   776,885
-------------------------------------------------------------------------------------------------
</TABLE>


                                                                               2
<PAGE>


Imperial Petroleum Recovery Corporation
(a development stage company)

Statements of Operations (Unaudited)
Six Months Ended April 30, 1997 and 1996

<TABLE>
<CAPTION>
=================================================================================================

                                                                      1997              1996
-------------------------------------------------------------------------------------------------

<S>                                                           <C>               <C>         
Revenue                                                       $                   $        

Cost of Goods Sold
                                                              -----------------------------------

Gross Profit

Operating Expenses
    Research and development expenses--prototype                  352,331              854,654
    Acquired research and development - Phonon
         Technologies                                                 --
                                                                                       102,649
    General and administrative expenses
       Internal administration, selling and marketing
         expense                                                1,134,667            1,053,745


                                                            -------------------------------------
Loss from Operations                                           (1,486,998)          (2,011,048)

Other income                                                        9,154                   --

  Extraordinary gain on debt settlement                           119,900                   --

                                                            -------------------------------------

Net loss                                                      $(1,357,944)         $(2,011,048)

-------------------------------------------------------------------------------------------------

Loss per share                                                $      (.19)         $      (.46)

Extraordinary gain per share                                  $       .01          $        --

Loss per share                                                $      (.18)         $      (.46)
-------------------------------------------------------------------------------------------------

</TABLE>



                                                                               3
<PAGE>


<TABLE>
<CAPTION>

Imperial Petroleum Recovery Corporation
(a development stage company)

Statements of Stockholders' deficit (Unaudited)
As of April 30, 1997
====================================================================================================================================

                               Common Stock                                                                     
                               ------------                                Additional                         Total
                                 No. of                   Stock            Paid in          Retained          Stockholders'
                                 Shares          Amount   Subscriptions    Capital          Deficit           Deficit
                                 ------          ------   -------------    -------          -------           -------

<S>                                 <C>         <C>          <C>           <C>            <C>             <C>         
Balance, November 1, 1996        8,315,080         $8,315     ($7,730)      $1,794,626     ($4,804,746)     ($3,009,535)

Sale of common stock
 & additional paid in capital      600,050            600                    2,601,920                        2,602,520

Net loss                                                                                    (1,357,944)      (1,357,944)

Balance, April 30, 1997          8,915,130         $8,915     ($7,730)      $4,396,546     ($6,162,690)     ($1,764,959)
                               ===========    ===========    ===========    ===========     ===========      ===========
</TABLE>


                                                                               4
<PAGE>


Imperial Petroleum Recovery Corporation
(a development stage company)

Statements of Cash Flows (Unaudited)
Six Months Ended April 30, 1997 and 1996

<TABLE>
<CAPTION>
==============================================================================================

                                                             1997                1996
----------------------------------------------------------------------------------------------

Increase (Decrease) in Cash and Cash Equivalents
<S>                                                      <C>                  <C>         
Cash Flows from Operating Activities

    Net loss                                             $(1,357,944)         $(2,011,048)
                                                         -------------------------------------
    Adjustments to reconcile net loss to net
      cash used in operating activities

        Changes in assets and liabilities
           Decrease in deposits                                   --                1,989
           Decrease in notes receivable                       84,050                   --
           Decrease in accrued liabilities                  (124,542)                  --
           Decrease in accounts payable                      404,798              908,934
                                                         -------------------------------------

Total Adjustments                                            364,306              910,923
                                                         -------------------------------------

Net Cash Used in Operating Activities                       (993,638)          (1,100,125)
                                                         -------------------------------------
Cash Flows from Investing Activities
    Additions to property and equipment                      (20,010)             (40,047)
                                                         -------------------------------------

Net Cash Used in Investing Activities                        (20,010)             (40,047)
                                                         -------------------------------------

Cash Flows from Financing Activities
    Proceeds from issuance of common stock and
      Additional paid in capital                             659,216              748,505
    Proceeds from loans from affiliated entities             362,102              222,000
    Payments on notes payable                                 (6,456)                  --
     Proceeds from bank overdraft                              1,214                   --
                                                         -------------------------------------

Net Cash Provided by Financing Activities                  1,013,648              970,505
                                                         -------------------------------------

Net Increase (decrease) in Cash                                   --             (169,667)

Cash and Cash Equivalents, Beginning of Period                    --              208,339
                                                         -------------------------------------

Cash and Cash Equivalents, End of Period                 $        --          $    38,672
                                                         -------------------------------------

</TABLE>
    
                                                                               5
<PAGE>



Imperial Petroleum Recovery Corporation
(a development stage company)

Notes to Financial Statements
================================================================================
APRIL 30, 1997
-------------------------------------------------------------------------------


NOTE A - BASIS OF PRESENTATION


The accompanying unaudited financial statements include the accounts of Imperial
Petroleum Recovery Corporation (the "Company"). Such statements have been
prepared in conformity with generally accepted accounting principles 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 generally accepted accounting principles 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 six month period ended April
30, 1997 are not necessarily indicative of the results for the fiscal year
ending October 31, 1997. The accompanying unaudited financial statements should
be read in conjunction with the financial statements and notes thereto included
in the Company's Annual Report on form 10-KSB for the fiscal year ended October
31, 1996.




NOTE B - ORGANIZATION AND USE OF ESTIMATES


Organization

Imperial Petroleum Recovery Corporation (a development stage company
incorporated in Nevada) has been in the development stage since commencement of
operations in fiscal year 1995. Operations to date have been comprised of
developing and marketing crude oil sludge recovery process technology. Since
December 1996, principal operations have been conducted in Texas.

Use of Estimates

In preparing financial statements in conformity with generally accepted
accounting principles, management is required to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
revenue and expenses during the reporting period.
Actual results could differ from those estimates.



NOTE C - REALIZATION OF ASSETS


The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplate continuation of the
Company as a going concern. However, the Company has sustained substantial
losses from operations since inception. In addition, the Company has used,
rather than provided, cash in its operations.


                                                                               6
<PAGE>


Imperial Petroleum Recovery Corporation
(a development stage company)

Notes to Financial Statements - Continued

================================================================================
APRIL 30,  1997
--------------------------------------------------------------------------------


NOTE C - REALIZATION OF ASSETS - Continued

In view of the matters described in the preceding paragraph, recoverability of a
major portion of the recorded asset amounts shown in the accompanying 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 maintain present 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 that might be necessary should the Company be
unable to continue in existence.

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.

In December 1996, the Company effected a significant number of cost-cutting
initiatives aimed at continuing to fund its operations from existing resources
and reducing the level of revenue required to achieve a break-even cash flow
position. These initiatives included centralizing operations in Houston, Texas,
re-organizing management and instituting a complete set of internal cost control
policies.


                                                                               7
<PAGE>



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

     This information should be read in conjunction with the Management's
Discussion and Analysis of Financial Condition and the Company's Annual Report
on Form 10-KSB for the fiscal year ended October 31, 1996.

LIQUIDITY & CAPITAL RESOURCES

     During the six month period ended April 30, 1997, the Company received net
proceeds of approximately $2,602,520 from the sale of restricted common stock
and additional paid in capital. The company used approximately ($1,357,944) in
cash flows from operating activities, excluding changes in assets and
liabilities, during the six month period ended April 30, 1997, compared to
approximately ($2,011,048) for the corresponding period of 1996. The total net
cash used by operating activities was approximately ($993,638) for the six month
period ended April 30, 1997, compared to approximately ($1,100,125) for the
corresponding period of 1996.

     Cash used by investing activities totaled approximately $20,010 for the six
month period ended April 30, 1997 as compared to investing activities totaling
approximately $40,047 for the corresponding period of 1996.

     Cash provided by financing activities totaled approximately $1,013,648 for
the six month period ended April 30, 1997 compared to approximately $970,505 for
the corresponding period of 1996. The company successfully completed a private
placement in April 1996, which yielded net proceeds of approximately $748,505.

     The Company expects to continue to make investments in the future to
support its overall growth. Currently, it is anticipated that ongoing operations
will be financed primarily from net proceeds of restricted stock sales and
additional paid in capital. As indicated in the Company's most recent Annual
Report on Form 10-KSB, that while continued sale of restricted stock may provide
the cash in certain periods, to the extent the Company experiences growth in the
near future, the Company anticipates that its operating and product development
activities may use cash and, consequently, such growth may require the Company
to obtain additional sources of financing. There can be no assurances that
unforeseen events may not require more working capital that the Company
currently has at its disposal.

FUTURE OPERATING RESULTS

     The preceding paragraph and the following discussion include
forward-looking statements regarding the Company's future financial position and
results of operations. Actual financial position and results of operations may
differ materially from the statements.

     The Company has invested significant amounts in the research and
development and the initial marketing of the MST unit. The emphasis, attention,
and dedication of the Company's limited resources for the MST system have caused
and, in management's view, will continue to cause the negative operating
earnings experienced to date. However, the Company believes that the value and
sales potential of the MST system outweigh the risk of continued operating
losses. The first product of the MST product line became generally available
during the fourth quarter of fiscal year 1997 and the Company believes that
revenues will begin to grow as contracts are finalized in fiscal year 1998.

     The Company does not expect revenue growth to occur ratably over the 1998
fiscal year; instead, the Company expects that the major impact of the MST
product introduction on revenues and earnings will occur during the second half
of the year. Revenue growth in the third quarter of fiscal 1998 will depend to a
large extent on the timing of the Company's rollout of the MST unit.


                                                                               8
<PAGE>


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


FUTURE OPERATING RESULTS - Continued


     The Company's ability to achieve its revenue and profitability objectives
in fiscal year 1998 will depend on many factors not entirely within the
Company's control. These include the timing and market acceptance of the MST
unit and other new products and features announced and introduced by the Company
and its competitors, and the extent to which the Company is successful in
placing an MST unit in strategic facilities to gain broader acceptance of the
technology. Other factors include rapid changes in technologies and standards
relating to sludge production and remediation of existing sludge in tanks and
ponds.

     The foregoing forward-looking statements involve a number of risks and
uncertainties. In addition to the factors discussed above, among the factors
that could cause actual results to differ materially are those listed in the
Company's most recent Annual Report of Form 10-KSB under the headings Item
1-"Description of business-Forward Looking and Cautionary Statements" and Item
6-"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

     Because of the uncertainties affecting the Company's future operation
results, past performance should not be reliable indicator of future
performance. The use of historical trends to anticipate results or trends in
future periods may not be appropriate. In addition, the Company's participation
on a highly dynamic industry may result in significant volatility in the price
of the Company's common stock.

     The Company cautions that the preceding list of cautionary statements is
not exclusive.

     RESULTS OF OPERATIONS

Net Sales

     There were no net sales for the six month period ended April 30, 1997, the
same as recorded for the corresponding period of 1996.

Operating Expenses

     Selling, general and administrative expenses for the six month period ended
April 30, 1997, were approximately $1,134,667 an increase over the approximately
$1,053,745 recorded for the corresponding period of 1996.

     Research and development expenses for the six month period ended April 30,
1997, were approximately $352,331 a decrease over the approximately $957,303
recorded for the corresponding period of 1996. The $957,303 recorded in the
corresponding period of 1996 included $23,448 of cost related to acquired
research and development.

Interest and Financing Expenses

     Total other income (expense) for the six month period ended April 30, 1997,
was approximately $129,054, which included a one-time charge associated with the
gain on debt settlement. The Company recorded no other income (expense) for the
corresponding period of 1996.

Other

     To date, inflation and seasonality has not had a material impact on the
Company's results of operations.


                                                                               9
<PAGE>


                                     PART II


ITEM 1. LEGAL PROCEEDINGS

     During the period covered by this report, no legal proceedings required to
be reported became reportable events, and there were no material developments in
or terminations of any previously reported proceedings.

     The Company is subject to routine litigation from time to time arising from
its operations. Management believes that any such pending litigation will not
have a material effect on the Company's financial position or results of
operations.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

     The information under the caption "Recent Sales of Unregistered Securities"
in Item 5 of the Company's Annual Report on Form 10-KSB for the fiscal year
ended October 31, 1997 is incorporated herein by reference.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

     None

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

     No matter was submitted to a vote of the Company's security holders during
the period covered by this report.

ITEM 5. OTHER INFORMATION

     None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits

     The exhibits to this report are listed in the Exhibit Index, which is
incorporated herein by reference.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K -Continued

     (b) Reports on Form 8-K

     The Company did not file any reports on Form 8-K during the period covered
by this report.


                                                                              10
<PAGE>


SIGNATURES

     Pursuant to the requirements of the Exchange Act, the Registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



                  Imperial Petroleum Recovery Corporation
                  (Registrant)



Date:  April 14, 1998 /s/ C. Brent Karchner
                        ---------------------
                       C. Brent Karchner
                       President and Chief Executive Officer
                       (Duly Authorized Officer and Principal Financial Officer)


                                                                              11
<PAGE>


                     Imperial Petroleum Recovery Corporation

                          Exhibit Index to Form 10-QSB


      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-SB, filed with the
                    Commission with a filing date of August 8, 1996, Commission
                    File No. 0-21169)
                  
         3.2        Bylaws of the Company (incorporated by reference to Exhibit
                    3.2 to the Company's Annual Report on Form 10-KSB for the
                    fiscal year ended October 31, 1996, filed with the
                    Commission with a filing date of November 26, 1997,
                    Commission File No. 0-21169)
                  
         27*        Financial data schedule
                  
            
*  Filed herewith.


                                                                              12