UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

             [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 1999

                                       OR

             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

          For the transition period from.............. to .............

                         Commission file number 0-22149

                           EDGE PETROLEUM CORPORATION
             (Exact name of registrant as specified in its charter)


                               Delaware 76-0511037
                (State or other jurisdiction of (I.R.S. Employer
               incorporation or organization) Identification No.)


                              Texaco Heritage Plaza
                             1111 Bagby, Suite 2100
                              Houston, Texas 77002
                    (Address of principal executive offices)

                                 (713) 654-8960
              (Registrant's telephone number, including area code)

         Indicate by checkmark  whether the registrant (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
                                                      ---    ---

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common equity, as of the latest practicable date.

             Class                           Outstanding at May 11, 1999
         ------------                        ------------------------------
         Common Stock                                  7,758,667


<PAGE>

                                             PART I. FINANCIAL INFORMATION
Item 1. Financial Statements

EDGE PETROLEUM CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)
<TABLE>
-----------------------------------------------------------------------------------------------------------------
                                                                                      March 31,     December 31,
                                                                                        1999           1998
                                                                                    -------------- --------------
ASSETS
CURRENT ASSETS:
<S>                                                                                     <C>          <C>
   Cash and cash equivalents                                                            $ 259,652    $   272,428
   Accounts receivable, trade                                                           3,297,701      2,237,113
   Accounts receivable, joint interest owners, net                                      2,096,201      2,215,096
   Receivable from related parties                                                        204,740        228,922
   Other current assets                                                                   280,213        313,631
                                                                                     ------------   ------------
                Total current assets                                                    6,138,507      5,267,190

PROPERTY AND EQUIPMENT, Net - full cost method of accounting
  for oil and natural gas properties                                                   46,675,307     47,258,993

INVESTMENT IN FRONTERA                                                                  3,750,561      3,744,935

OTHER ASSETS                                                                                7,789          7,789
                                                                                     ------------   ------------
TOTAL ASSETS                                                                         $ 56,572,164   $ 56,278,907
                                                                                     ============   ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
   Accounts payable, trade                                                            $ 4,256,976    $ 2,948,791
   Accrued liabilities                                                                  3,484,658      3,799,881
   Accrued interst payable                                                                 95,687         93,880
   Current portion of long-term debt                                                    7,400,000      6,700,000
                                                                                     ------------    -----------
                Total current liabilities                                              15,237,321     13,522,552
                                                                                     ------------    -----------
LONG-TERM DEBT                                                                          4,600,000      5,800,000
                                                                                     ------------    -----------
                Total liabilities                                                      19,837,321     19,322,552
                                                                                     ------------    -----------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
   Preferred stock, $.01par value; 5,000,000 shares authorized; none outstanding
   Common stock, $.01par value; 25,000,000 shares authorized; 7,758,667 shares
     issued and outstanding at March 31, 1999 and December 31, 1998                        77,586         77,586
   Additional paid-in capital                                                          47,769,159     47,769,159
   Retained earnings (deficit)                                                         (9,703,898)    (9,398,410)
   Unearned compensation - restricted stock                                            (1,408,004)    (1,491,980)
                                                                                     ------------   ------------
                Total stockholders' equity                                             36,734,843     36,956,355
                                                                                     ------------   ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                           $ 56,572,164   $ 56,278,907
                                                                                     ============   ============
</TABLE>

See accompanying notes to consolidated financial statements.

                                     2
<PAGE>

EDGE PETROLEUM CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
<TABLE>
--------------------------------------------------------------------------------------------------------------------------
                                                                     Three Months Ended
                                                                          March 31,
                                                                 ---------------------------
                                                                      1999          1998
<S>                                                               <C>           <C>
OIL AND NATURAL GAS REVENUES                                      $ 3,542,188   $ 3,785,666

OPERATING EXPENSES:
   Lifting Costs                                                      479,128       370,059
   Severance and ad valorem taxes                                     352,689       301,125
   Depletion, depreciation and amortization                         1,902,760     1,186,586
   General and administrative expenses                              1,001,819       866,311
   Unearned compensation expense                                       83,976       155,052
                                                                  -----------   -----------
                Total operating expenses                            3,820,372     2,879,133
                                                                  -----------   -----------
OPERATING INCOME (LOSS)                                              (278,184)      906,533

OTHER INCOME AND EXPENSE:
   Interest expense                                                   (38,326)
   Interest income                                                     11,022        46,045
                                                                  -----------   -----------
NET INCOME BEFORE INCOME TAX EXPENSE AND
  CUMULATIVE EFFECT OF ACCOUNTING CHANGE                             (305,488)      952,578

INCOME TAX EXPENSE                                                                 (333,881)
                                                                  -----------   -----------
NET INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE             (305,488)      618,697

CUMULATIVE EFFECT OF ACCOUNTING CHANGE                                            1,780,835
                                                                  -----------   -----------
NET INCOME (LOSS)                                                 $  (305,488)   $2,399,532
                                                                  ===========   ===========

BASIC EARNINGS(LOSS)PER SHARE:
  Net income (loss) before cumulative effect of accounting change     $(0.04)       $ 0.08
  Cumulative effect of accounting change                                               0.23
                                                                       ------        ------
  Basic earnings(loss)per share                                       $(0.04)       $ 0.31
                                                                       ======        ======
DILUTED EARNINGS(LOSS)PER SHARE:
  Net income (loss) before cumulative effect of accounting change     $(0.04)       $ 0.08
  Cumulative effect of accounting change                                               0.23
                                                                       ------        ------
  Diluted earnings (loss)per share                                    $(0.04)       $ 0.31
                                                                       ======        ======
BASIC WEIGHTED AVERAGE NUMBER OF
   COMMON SHARES OUTSTANDING                                        7,758,667     7,760,869
                                                                    =========     =========
DILUTED WEIGHTED AVERAGE NUMBER OF
   COMMON SHARES OUTSTANDING                                        7,758,667     7,794,098
                                                                    =========     =========
</TABLE>


See accompanying notes to consolidated financial statements.

                                       3
<PAGE>


EDGE PETROLEUM CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited)
<TABLE>
------------------------------------------------------------------------------------------------------------------------------------

                                                                                                       Unearned
                                                 Common Stock          Additional                    Compensation-      Total
                                           -------------------------     Paid-in        Retained      Restricted     Stockholders'
                                              Shares        Amount       Capital    Earnings(Deficit)    Stock           Equity
                                           ----------      --------   ------------  ----------------- -------------- --------------
BALANCE,
<S>        <C>                              <C>            <C>        <C>             <C>           <C>             <C>
   JANUARY 1, 1999                          7,758,667      $ 77,586   $ 47,769,159    $(9,398,410)   $ (1,491,980)  $36,956,355

   Unearned compensation expense                                                                           83,976        83,976

   Net loss                                                                              (305,488)                     (305,488)
                                           ----------     ---------   ------------    -----------   -------------   ------------
BALANCE,
   MARCH 31, 1999                           7,758,667      $ 77,586   $ 47,769,159    $(9,703,898)  $ (1,408,004)   $36,734,843
                                           ==========     =========   ============    ===========   =============   ============
</TABLE>


















See accompanying notes to consolidated financial statements.


                                       4
<PAGE>


EDGE PETROLEUM CORPORATION

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

                                                                                                 Three Months Ended
                                                                                                      March 31,
                                                                                           ------------------------------
                                                                                                  1999           1998
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                           <C>            <C>
   Net income (loss)                                                                          $  (305,488)    $2,399,532
   Adjustments to reconcile net income(loss)to net cash provided by operating
    activities:
      Cumulative effect of accouning change                                                                   (1,780,835)
      Depletion, depreciation and amortization                                                  1,902,760      1,186,586
      Deferred income taxes                                                                                      333,881
      Unearned compensation expense                                                                83,976        155,052
   Changes in assets and liabilities:
      Accounts receivable, trade                                                               (1,060,588)      (348,061)
      Accounts receivable, joint interest owners, net                                             118,895      3,304,666
      Receivable from related parties                                                              24,182         63,269
      Other current assets                                                                         33,418         48,950
      Other assets                                                                                                (7,463)
      Accounts payable, trade                                                                   1,308,185     (1,011,655)
      Accounts payable, related party                                                                            (40,000)
      Accrued liabilities                                                                        (295,223)       (31,532)
      Accrued interest payable                                                                      1,807
                                                                                              -----------    -----------
                 Net cash provided by operating activities                                      1,811,924      4,272,390
                                                                                              -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Oil and natural gas property and equipment purchases                                        (2,967,791)    (8,468,415)
   Proceeds from the sale of oil and natural gas properties                                     1,648,717      1,783,124
   Investment in Frontera                                                                          (5,626)
                                                                                              -----------    -----------
                 Net cash used in investing activities                                         (1,324,700)    (6,685,291)
                                                                                              -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Payment on long-term debt                                                                      (500,000)
                                                                                              -----------    -----------
                Net cash used in financing activities                                            (500,000)
                                                                                              -----------    -----------
NET DECREASE IN CASH AND CASH EQUIVALENTS                                                         (12,776)    (2,412,901)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                    272,428      3,777,950
                                                                                              -----------    -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                                        $ 259,652    $ 1,365,049
                                                                                              ===========    ===========

SUPPLEMENTAL CASH FLOW DISCLOSURES - Cash paid for interest, net of amounts capitalized          $ 38,305


</TABLE>

See accompanying notes to consolidated financial statements.

                                       5
<PAGE>
                                                     

EDGE PETROLEUM CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      The  financial  statements  included  herein  have been  prepared  by Edge
Petroleum  Corporation,  a Delaware  corporation (the "Company"),  without audit
pursuant to the rules and regulations of the Securities and Exchange Commission,
and reflect all adjustments  which are, in the opinion of management,  necessary
to present a fair  statement  of the results for the interim  periods on a basis
consistent with the annual audited consolidated  financial statements.  All such
adjustments are of a normal recurring nature.  The results of operations for the
interim periods are not necessarily indicative of the results to be expected for
an  entire  year.  Certain   information,   accounting   policies  and  footnote
disclosures  normally  included in financial  statements  prepared in accordance
with generally accepted accounting principles have been omitted pursuant to such
rules and  regulations,  although the Company  believes that the disclosures are
adequate to make the information  presented not  misleading.  Certain prior year
amounts have been reclassified to conform to the current year presentation. Such
reclassifications  do not affect net income (loss).  These financial  statements
should be read in conjunction with the Company's audited consolidated  financial
statements  included in the  Company's  Annual  Report on Form 10-K for the year
ended December 31, 1998.

         Accounting Change - The Company uses the full-cost method of accounting
for its oil and natural gas  properties.  Under this  method,  all  acquisition,
exploration  and  development  costs  that  are  directly  attributable  to  the
Company's acquisition, exploration and development activities are capitalized in
a "full-cost  pool" as  incurred.  In the second  quarter of 1998 and  effective
January 1, 1998,  the Company  changed  its method of  accounting  for  internal
geological and geophysical ("G&G") costs to one of capitalization of such costs,
which are directly  attributable  to  acquisition,  exploration  and development
activities,  to oil and natural gas properties.  Prior to the change the Company
expensed these costs as incurred.  The Company  believes the  accounting  change
provides  for a better  matching of  revenues  and  expenses  and  enhances  the
comparability  of it's financial  statements  with those of other companies that
follow the full-cost method of accounting.  Accordingly,  the financial  results
for the period  ended  March 31,  1998 have been  restated to give effect to the
change in accounting method effective January 1, 1998. The $1,780,835 cumulative
effect  of the  change in prior  years  (after  reduction  for  income  taxes of
$958,910) is included in income for the three  months ended March 31, 1998.  The
effect of the accounting  change on the three months ended March 31, 1998 was to
increase net income by $2,041,066 or $0.26 basic and diluted  earnings per share
($260,231  before  cumulative  effect of  accounting  change or $0.03  basic and
diluted earnings per share).

Accounting Pronouncements

Derivatives - In June 1998,  the  Financial  Accounting  Standards  Board issued
Statement of Financial  Accounting Standard No. 133,  "Accounting for Derivative
Instruments and Hedging Activity" ("SFAS 133"). SFAS 133 establishes  accounting
and reporting  standards for derivative  instruments and hedging activities that
require an entity to recognize all derivatives as an asset or liability measured
at fair value. Depending on the intended use of the derivatives,  changes in its
fair value will be  reported  in the period of change as either a  component  of
earnings or a component of other comprehensive income.

SFAS 133 is effective  for all fiscal  quarters  beginning  after June 15, 1999.
Earlier application of SFAS 133 is encouraged, but not prior to the beginning of
any fiscal  quarter that begins  after  issuance of the  statement.  Retroactive
application  to periods  prior to adoption is not  allowed.  The Company has not
quantified  the impact of adoption on its  financial  statements  or the date it
intends to adopt.
                                       6
<PAGE>

2.   LONG TERM DEBT

         During July 1995, the Company entered into a revolving  credit facility
(the  "Revolving  Credit  Facility")  with a bank to finance  temporary  working
capital  requirements.  The Revolving Credit Facility provided up to $20 million
in borrowings  limited by a borrowing  base, as defined by the Revolving  Credit
Facility.  The Revolving  Credit Facility  provided for interest at the lender's
prime rate plus 0.75%. The borrowing base was subject to review by the bank on a
quarterly basis and could be adjusted subject to the provisions of the Revolving
Credit  Facility.  Effective April 1, 1998, the Company amended and restated its
Revolving  Credit  Facility to provide a revolving  line of credit of up to $100
million  bearing  interest  at a rate  equal to prime  or LIBOR  plus  1.5% - 2%
depending on the level of borrowing  base  utilization.  The  Company's  initial
borrowing  base  authorized  by the banks was  approximately  $15  million.  The
Revolving  Credit  Facility  is secured by  substantially  all the assets of the
Company.

      Effective   September  29,  1998,  the  Company  had  its  borrowing  base
redetermined and amended its Revolving Credit  Facility.  The initial  borrowing
base authorized by the bank was $15 million.  Beginning  October 1, 1998, and on
the first day of each month  thereafter,  the borrowing  base was required to be
reduced by $550,000.

      The Revolving Credit Facility provides for certain restrictions, including
but not limited to,  limitations on additional  borrowings and issues of capital
stock, sales of its oil and natural gas properties or other collateral, engaging
in merger or  consolidation  transactions  and  prohibitions  of  dividends  and
certain  distributions  of cash or properties and certain  liens.  The Revolving
Credit Facility also contains certain financial covenants.

     Effective  March 1, 1999, the Company and the Bank amended the Revolving  
Credit  Facility to include the following  terms; 1),the initial borrowing base
 is $12 million comprised of a two tranche financing of a $9 million Revolving 
Credit Facility and a $3 million term  facility,  2) Beginning May 1, 1999,  
and on the first day of each month  thereafter,  the Revolving  Credit  Facility
borrowing  base is required to be reduced by $400,000,  3) 75% of prospect sales
will be used to pay down the term facility with the remaining  unpaid term 
facility  balance  maturing on August 31, 1999.  The Company and the Bank also 
amended the  Revolving  CreditFacility to replace the financial covenants on a 
go forward basis with a Tangible Net Worth Covenant and Fixed Charge Covenant. 
TheTangible Net Worth  Covenant  requires that at the end of each quarter the 
Company's  Tangible Net Worth be at least 90% of the Company's  actual tangible 
networth as reported at December 31, 1998 (or  $33,260,720)  plus 50% of 
positive net income and 100% of other  increases in equity for all fiscal  
quarters  ending  subsequent to December 31, 1998.  The Fixed Charge  Covenant  
requires that at the end of each quarterbeginning  June 30, 1999,  the ratio of
annualized  EBITDA (as defined) to the sum of annualized  interest  expense plus
50% of the quarter end loans  outstanding  must be at least 1.25 to 1.00.  
Interest will accrue at a rate of LIBOR plus 1.75% - 2.75% depending on the 
borrowing base utilization.

3.   EARNINGS PER SHARE

The Company  accounts  for earnings per share in  accordance  with  Statement of
Financial  Accounting  Standard No. 128 - "Earnings per Share," ("SFAS No. 128")
which  establishes the requirements  for presenting  earnings per share ("EPS").
SFAS No. 128 requires the  presentation of "basic" and "diluted" EPS on the face
of the income statement.  Basic earnings per common share amounts are calculated
using the  average  number of common  shares  outstanding  during  each  period.
Diluted  earnings  per share  assumes the exercise of all stock  options  having
exercise prices less than the average market price of the common stock using the
treasury stock method.
                                       7
<PAGE>

              The following is presented as a  reconciliation  of the numerators
      and denominators of basic and diluted earnings per share computations,  in
      accordance with SFAS No. 128.
<TABLE>
                                                              Three Months Ended
                               --------------------------------------------------------------------------------
                                          March 31, 1999                                March 31, 1998
                               -------------------------------------      -------------------------------------

                                  Income       Shares      Per-Share         Income       Shares      Per-Share
                               (Numerator)  (Denominator)    Amount       (Numerator)  (Denominator)    Amount
                               -----------  -------------  ---------      -----------  -------------  ---------
Basic EPS
Income (loss) available to
<S>                            <C>             <C>            <C>         <C>             <C>            <C>
  common stockholders          $  (305,488)     7,758,667    $(0.04)       $2,399,532     7,760,869      $ 0.31

Effect of Dilutive Securities
  Common stock options                                                                       33,229
                               -----------     ---------     -------      -----------     ---------     -------
Diluted EPS
Income (loss) available to 
  common stockholders          $  (305,488)    7,758,667     $(0.04)       $2,399,532     7,794,098      $ 0.31
                               ===========     =========     =======      ===========     =========     =======

</TABLE>

4.   SUBSEQUENT EVENT

         On May 6, 1999, the Company  completed a private  offering of 1,400,000
shares of common stock based on a market price of $5.3125 per common share.  The
private offering also provides for warrants, which were purchased for $0.125 per
share,  to acquire an  additional  420,000  shares of common  stock at $5.35 per
share. Total proceeds, net of offering costs, were approximately $7.4 million of
which $4.9 million was used to repay debt under the  Revolving  Credit  Facility
with the remainder to be used to satisfy working capital requirements and fund a
portion of the Company's future exploration program. After the repayment of debt
the Company has available  approximately $1.5 million under its Revolving Credit
Facility for future borrowings.

5.   INCOME TAXES

The Company  accounts  for income  taxes under the  provisions  of  Statement of
Financial  Accounting  Standards No. 109 - "Accounting for Income Taxes," ("SFAS
No. 109") which provides for an asset and liability  approach for accounting for
income  taxes.  Under this  approach,  deferred tax assets and  liabilities  are
recognized based on anticipated future tax consequences, using currently enacted
tax laws,  attributable  to differences  between  financial  statement  carrying
amounts of assets and  liabilities  and their  respective tax bases.  Due to the
Company  incurring a net loss for the three  months ended March 31, 1999 and due
to the Company having significant  deferred tax assets, no tax benefit (expense)
was  recorded.  Due to  the  uncertainty  of the  Company's  ability  to  become
profitable  in the  future an  allowance  has been  provided  to offset  the tax
benefits  of certain tax  assets.  Should the Company  have net income in future
periods  income tax expense will be recorded  upon  utilization  of deferred tax
assets.
                                       8
<PAGE>
Item 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

      The  following  is   management's   discussion  and  analysis  of  certain
significant  factors  that  have  affected  certain  aspects  of  the  Company's
financial  position and  operating  results  during the periods  included in the
accompanying  unaudited  condensed   consolidated  financial  statements.   This
discussion  should  be read  in  conjunction  with  the  accompanying  unaudited
condensed consolidated financial statements included elsewhere in this Form 10-Q
and with the Company's audited consolidated financial statements included in the
Company's  annual  report on Form 10-K for the year  ended  December  31,  1998.
Unless otherwise  indicated by the context,  references  herein to the "Company"
mean Edge Petroleum Corporation,  a Delaware corporation that is the registrant,
and its corporate subsidiaries .

Overview

         Edge Petroleum  Corporation is an independent energy company engaged in
the  exploration,  development  and  production  of oil and  natural  gas.  Edge
conducts its operations  primarily along the onshore Gulf Coast with its primary
emphasis  in  South  Texas  and  South  Louisiana  where it  currently  controls
interests in excess of 222,000  gross acres under lease and option.  The Company
explores for oil and natural gas by  emphasizing  an integrated  application  of
highly advanced data visualization  techniques and computerized 3-D seismic data
analysis to identify potential hydrocarbon  accumulations.  The Company believes
its approach to processing and analyzing geophysical data differentiates it from
other  independent  exploration  and production  companies and is more effective
than  conventional  3-D seismic data  interpretation  methods.  The Company also
believes it maintains  one of the largest  databases of onshore South Texas Gulf
Coast 3-D seismic data of any  independent  oil and natural gas company,  and is
continuously acquiring additional data within this core region.

         The Company  acquires  3-D seismic  data by  organizing  and  designing
regional data  acquisition  surveys for its proprietary  use, as well as through
selective  participation in regional  non-proprietary  3-D surveys.  The Company
negotiates  seismic  options  for a  majority  of the areas  encompassed  by its
proprietary surveys, thereby allowing it to secure identified prospect leasehold
interests  on  a   non-competitive,   pre-arranged   basis.   In  the  Company's
non-proprietary 3-D survey areas, the Company's technical  capabilities allow it
to rapidly and  comprehensively  evaluate  large volumes of regional 3-D seismic
data,  facilitating  its  ability  to  identify  attractive  prospects  within a
surveyed  region and to secure the  corresponding  leasehold  interests ahead of
other industry participants.

         The  Company's   extensive   technical  expertise  has  enabled  it  to
internally  generate  substantially all of its 3-D prospects drilled to date and
to assemble a large  portfolio of 3-D based prospects for future  drilling.  The
Company  pursues  drilling  opportunities  that  include  a blend of  shallower,
normally pressured reservoirs that generally involve moderate costs and risks as
well as deeper,  over-pressured  reservoirs that generally involve greater costs
and risks, but have higher economic potential. During the past year, the Company
has  expanded  its  relative  focus to  increase  its  exposure  to  exploration
opportunities  in the deeper  geological  section.  The  Company  mitigates  its
exposure  to  exploration  costs  and risk by  conducting  its  operations  with
industry partners,  including major oil companies and large  independents,  that
generally pay a disproportionately  greater share of seismic acquisition and, in
many  instances,  leasing and drilling  costs than the Company.  The Company may
seek to participate in an increased  number of externally  generated  prospects,
including those in which the Company pays a disproportionate  share of the cost,
depending  upon the  quality,  size,  price and other  factors  relating to such
prospects.

         The Company uses the  full-cost  method of  accounting  for its oil and
natural gas  properties.  Under this method,  all  acquisition,  exploration and
development costs,  including certain general and administrative  costs that are

                                       9
<PAGE>

directly attributable to the Company's acquisition,  exploration and development
activities,  are  capitalized  in a "full-cost  pool" as  incurred.  The Company
capitalizes  internal Geological and Geophysical ("G&G") costs that are directly
attributable to acquisition,  exploration and development  activities to oil and
natural gas properties.  Total internal G&G costs  capitalized  during the three
months ended March 31, 1999 and 1998 were $563,592 and  $539,965,  respectively.
The Company records depletion of its full-cost pool using the unit of production
method. Investments in unproved properties are not subject to amortization until
the proved  reserves  associated  with the projects can be  determined  or until
impaired.  To the extent that  capitalized  costs subject to amortization in the
full-cost  pool (net of depletion,  depreciation  and  amortization  and related
deferred  taxes)  exceed  the  present  value  (using  a 10%  discount  rate) of
estimated  future  net  after-tax  cash flows from  proved oil and  natural  gas
reserves,  such  excess  costs are  charged to  operations.  Once  incurred,  an
impairment of oil and natural gas  properties is not reversible at a later date.
Impairment of oil and natural gas properties is assessed on a quarterly basis in
conjunction with the Company's  quarterly filings with the Commission.  At March
31, 1999, no full cost ceiling test write down of oil and natural gas properties
was necessary.

      Due to the  instability  of oil and natural  gas  prices,  the Company has
entered into, from time to time, price risk management transactions (e.g., swaps
and  collars)  for a portion of its  natural  gas  production  to achieve a more
predictable  cash flow, as well as to reduce  exposure from price  fluctuations.
While  the use of these  arrangements  limits  the  benefit  to the  Company  of
increases  in the price of  natural  gas it also  limits  the  downside  risk of
adverse price  movements.  The Company's  hedging  arrangements  apply to only a
portion of its  production  and provide only partial  price  protection  against
declines in natural gas prices and limits  potential gains from future increases
in prices.  The Company  accounts for these  transactions as hedging  activities
and, accordingly,  gains and losses are included in oil and natural gas revenues
during the period the hedged  transactions  occur.  During  December  1998,  the
Company  entered  into a fixed price swap for $1.96 per MMbtu  (delivered  price
basis, Houston Ship Channel),  with settlement for each calendar month occurring
five business days following the publishing of the Inside F.E.R.C. Gas Marketing
Report.  This fixed  price swap  covers  13,000  MMbtu per day and is  effective
beginning  March 1, 1999 and  expires on October  31,  1999.  Total  natural gas
production  hedged under this arrangement was 403,000 MMbtu for the three months
ended March 31, 1999 or 21% of the current quarter's production.  Existing swaps
currently  cover  approximately  68% of current daily  production.  During April
1999,  the Company  entered  into a fixed  price swap for $2.15 per MMbtu.  This
fixed price swap covers  3,000 MMbtu per day and is effective  beginning  May 1,
1999 and expires on October 31,  1999.  During the three  months ended March 31,
1998,  the  Company  had in place  two  natural  gas  commodity  collars  with a
financial  institution  one of which  expired on January 31, 1998 with the other
expiring on April 30, 1998.  These  collars each covered 5,000 MMbtu per day, or
approximately  29% of the Company's  daily  production,  with floating floor and
ceiling  prices ranging  between $2.25 MMbtu and $3.15 per MMbtu.  Total natural
gas production hedged under these collars was 450,000 MMbtu for the three months
ended March 31, 1998 or 29% of production.  Included within natural gas revenues
for the three  month  periods  ended March 31,  1999 and 1998 was  $142,346  and
$36,700, respectively, representing net gains from swap and collar activities.

         The  Company's  revenue,  profitability  and future  rate of growth and
ability to borrow funds or obtain additional capital,  and the carrying value of
its properties,  are substantially  dependent upon prevailing prices for oil and
natural  gas.  These  prices are  dependent  upon  numerous  factors  beyond the
Company's control, such as economic,  political and regulatory  developments and
competition from other sources of energy. Oil prices have declined significantly
during the past year and more  recently  natural gas prices  have shown  similar
declines. Even though prices have shown signs of resent recovery since March 31,
1999, a substantial or extended decline in oil and natural gas prices could have
a material  adverse  effect on the  Company's  financial  condition,  results of
operation  and access to capital,  as well as the  quantities of oil and natural
gas reserves that the Company may economically produce.

                                       10
<PAGE>

RESULTS OF OPERATIONS

Three Months Ended March 31, 1999 Compared to the Three Months Ended 
March 31,1998

Revenue and Production

      Oil and natural gas  revenues  for the three  months  ended March 31, 1999
decreased 6% from $3.8 million to $3.5 million,  as compared to the three months
ended March 31, 1998.  Production  volumes for oil and  condensate for the three
months ended March 31, 1999 decreased 11% from 42 MBbls to 37 MBbls, as compared
to the three  months ended March 31,  1998.  The decrease in oil and  condensate
production  during the three months ended March 31, 1999  decreased  revenues by
$64,580 (based on 1998 comparable quarter average prices),  further decreased by
a 26%  decrease in the average oil and  condensate  sales price which  decreased
revenues by $134,857 (based on current quarter  production).  Production volumes
for natural gas for the three  months  ended March 31, 1999  increased  26% from
1,323 MMcf to 1,668 MMcf,  as compared to the three months ended March 31, 1998.
The increase in natural gas  production  during the three months ended March 31,
1999  increased  revenues by  $838,089,  offset by a 22% decrease in the average
natural gas sales price which  decreased  revenues by $882,130.  The increase in
oil and natural gas  production  was  primarily  due to 42 gross (16.94 net) new
successful  exploratory and development  wells being drilled and completed since
March 31, 1998 offset by normal  production  declines  from existing  wells.  As
described above, included within natural gas revenues for the three months ended
March 31, 1999 and 1998 was  $142,346 and  $36,700,  respectively,  representing
gains from current swap and collar activity.  Hedging  activities  increased the
effective  natural gas sales price by approximately  $0.09 per Mcf and $0.03 per
Mcf, respectively, or 5% and 1%, respectively,  for the three-months ended March
31, 1999 and 1998.

         The following table sets forth certain  operational data of the Company
for the periods presented:
<TABLE>

                                                 Three Months Ended            1999 Period Compared
                                                       March 31,                   to 1998 Period
                                            ----------------------------     ------------------------
                                                                               Increase   % Increase
                                                1999            1998          (Decrease)   (Decrease)
Production volumes:
<S>                                              <C>             <C>             <C>           <C>
   Oil and condensate (Bbls)                     37,410          42,139         (4,729)       (11)%
   Natural gas (Mcf)                          1,668,423       1,323,022        345,401         26 %
   Natural gas equivalents (Mcfe)             1,892,883       1,575,856        317,027         20 %

Average sales prices:
   Oil and condensate ($ per Bbl)               $ 10.05         $ 13.66        $ (3.61)       (26)%
   Natural gas ($ per Mcf)                      $  1.90         $  2.43        $ (0.53)       (22)%
   Natural gas equivalent ($per Mcfe)           $  1.87         $  2.40        $ (0.53)       (22)% 

Operating revenues:
   Oil and condensate                       $   376,019       $ 575,456     $ (199,437)       (35)%
   Natural gas                                3,166,169       3,210,210        (44,041)        (1)%
                                            -----------     -----------     ----------
Total                                       $ 3,542,188     $ 3,785,666     $ (243,478)        (6)%
                                            ===========     ===========     ==========
</TABLE>
Costs and Operating Expenses

       Lifting  costs for the three  months ended March 31, 1999  increased  29%
from  $370,059 to $479,128 as compared to the three months ended March 31, 1998,
due  primarily to increased oil and natural gas  production.  Lifting costs were
$0.25 per Mcfe and $0.24 per Mcfe for the  three-month  periods  ended March 31,
1999 and 1998, respectively.

                                       11
<PAGE>

       Severance  and ad valorem taxes for the three months ended March 31, 1999
increased  17% from  $301,125 to $352,689 as compared to the three  months ended
March 31, 1998,  due primarily to increased ad valorem  taxes.  Severance and ad
valorem taxes were $0.19 per Mcfe for both  three-month  periods ended March 31,
1999 and 1998, respectively.

       Depletion,  depreciation and amortization  expense ("DD&A") for the three
months ended March 31, 1999 increased 60% from $1.2 million to $1.9 million,  as
compared to the three months ended March 31, 1998.  Included within DD&A for the
three-month  periods  ended  March  31,  1999 and 1998 was $1.7  million  and $1
million,  respectively,  representing  depletion  expense of oil and natural gas
property,  which  increased  by 67%.  Increased  oil and natural gas  production
increased depletion expense by approximately  $206,000 and a 39% increase in the
overall  depletion rate further  increased  depletion  expense by  approximately
$494,000.  The increase in the  depletion  rate was  primarily  attributable  to
abandonments of certain  projects,  prospects and wells at December 31, 1998 and
dry holes drilled since March 31, 1998  contributing  to an overall  increase in
finding  cost.  Depletion  expense  on  a  unit  of  production  basis  for  the
three-month  periods  ended March 31, 1999 and 1998 was $0.90 per Mcfe and $0.65
per Mcfe,  respectively.  The  remaining  increase in DD&A is due  primarily  to
depreciation  of  new  computer  hardware,   software  and  office  improvements
purchased since March 31, 1998 and the amortization of deferred loan cost on the
Credit Facility which was effective in April 1998.

      General and  administrative  expenses  ("G&A") for the three  months ended
March 31, 1999  increased  16% from  $866,311 to $1 million,  as compared to the
three  months  ended  March  31,  1998.   The  increase  in  G&A  was  primarily
attributable  to a $144,000  decrease in overhead and  management  fees received
from  various  management,  operating  and seismic  agreements  during the three
months ended March 31, 1999.  Total overhead and management fees are recorded as
a reduction of G&A and were  approximately  $54,000 and $200,000,  respectively,
for the three months ended March 31, 1999 and 1998.  G&A on a unit of production
basis for the  three-month  periods  ended March 31, 1999 and 1998 was $0.53 per
Mcfe and $0.55 per Mcfe, respectively.

       Unearned  compensation  expense for the three months ended March 31, 1999
decreased from $155,052 to $83,976,  as compared to the three months ended March
31, 1998. The decrease is due to the  resignation of the former CEO and Chairman
of the  Board  during  November  of 1998  whereby  he  vested  in his  remaining
restricted stock grant. The Company charged to expense his unamortized  unearned
compensation upon his resignation.

       Interest  expense for the three  months  ended March 31, 1999 was $38,326
net of amounts capitalized of $225,597.  The increase in interest expense is due
to increased  borrowings  under the Company's  Credit  Facility  since March 31,
1998. The weighted average debt was $12 million for the three months ended March
31, 1999.  There was no debt  outstanding  during the  three-month  period ended
March 31, 1998.

        Interest income for the three months ended March 31, 1999 decreased from
$46,045 to $11,022,  as compared to the three months  ended March 31, 1998.  The
decrease in interest  income is due to the overall  reduction in invested  funds
during the comparable periods.

       Due to the Company  incurring a net loss for the three months ended March
31, 1999 and due to the Company having  significant  deferred tax assets, no tax
benefit (expense) was recorded.  Due to the uncertainty of the Company's ability
to become  profitable in the future an allowance has been provided to offset the
tax benefits of certain tax assets. Should the Company have net income in future
periods  income tax expense will be recorded  upon  utlization  of available tax
assets. Tax expense for the three months ended March 31, 1998 was $333,881.

                                       12
<PAGE>

       For the three months  ended March 31, 1999,  the Company had an operating
loss of $(278,184)  compared to operating income of $906,533 for the three month
period ended March 31, 1998,  primarily due to  significantly  lower natural gas
and oil and condensate prices,  further reduced by increased  operating expenses
and increased DD&A expense  offset by increased oil and natural gas  production.
Net loss was  $(305,488)  for the three months ended March 31, 1999,  or $(0.04)
basic and diluted loss per share, as compared to net income of $2.4 million,  or
$0.31 basic and diluted earnings per share,  ($618,697 before  cumulative effect
of  accounting  change or $0.08 basic and diluted  earnings per share),  for the
three-month period ended March 31, 1998.

LIQUIDITY AND CAPITAL RESOURCES

         The Company had cash and cash equivalents at March 31, 1999 of $259,652
consisting  primarily of  short-term  money market  investments,  as compared to
$272,428 at December 31, 1998.  Working  capital was $(9.1) million at March 31,
1999, as compared to $(8.3) million at December 31, 1998.

         Operating cash flow was approximately $1.7 million and $2.3 million for
the three-month periods ended March 31, 1999 and 1998,  respectively.  Operating
cash flow, a measure of performance for  exploration  and production  companies,
represents cash flows from operating  activities  prior to changes in assets and
liabilities.  Operating  cash flow should not be considered in isolation or as a
substitute  for  net  income,   operating  income,  cash  flows  from  operating
activities or any other measure of financial performance presented in accordance
with generally accepted  accounting  principles or as a measure of profitability
or liquidity.

         During the three months ended March 31, 1999, the Company  continued to
reinvest a  substantial  portion of its cash flows to  increase  its 3-D project
portfolio,  improve  its 3-D  seismic  interpretation  technology  and  fund its
drilling program.  Capital  expenditures during the three months ended March 31,
1999 were  approximately  $3 million as compared to $8.5 million during the same
period in 1998.  The Company  expended  $1.3 million in its drilling  operations
resulting  in the  drilling of 6 gross (2.53 net) wells  during the three months
ended March 31, 1999 as compared to 22 gross  (10.29 net) wells  during the same
period in 1998. Two wells are currently  drilling,  the Varn #2 located in South
Louisiana  and the  Worsham/O'Conner  #1 located in South  Texas.  Land and data
acquisition  expenditures were $1.7 million and were largely attributable to its
Nodosaria  Embayment  3-D  Project  Area  in  South  Louisiana.   Total  capital
expenditures for 1999 are expected to be approximately $18 million.

         Due to the Company's active  exploration and development and technology
enhancement  programs,  the Company has  experienced  and expects to continue to
experience substantial working capital requirements. The Company intends to fund
its 1999 capital  expenditures,  commitments  and working  capital  requirements
through  cash flows from  operations,  available  borrowings  under its existing
Revolving  Credit  Facility,   and  to  the  extent  necessary  other  financing
activities.  To provide  additional  working  capital the Company  continues  to
market a portion  of its  interest  in various  Company  generated  drill  ready
prospects.  Additionally,  the Company is currently evaluating various financing
and refinancing  options as well as  divestitures of certain  non-core and under
performing  assets.  The Company  believes  it will be able to generate  capital
resources and liquidity  sufficient  to fund its capital  expenditures  and meet
such financial obligations as they come due. In the event such capital resources
are not  available to the Company,  its  drilling  and other  activities  may be
curtailed.


                                       13
<PAGE>

Subsequent Event

         On May 6, 1999, the Company  completed a private  offering of 1,400,000
shares of common stock based on a market price of $5.3125 per common share.  The
private offering also provides for warrants, which were purchased for $0.125 per
share,  to acquire an  additional  420,000  shares of common  stock at $5.35 per
share. Total proceeds, net of offering costs, were approximately $7.4 million of
which $4.9 million was used to repay debt under the  Revolving  Credit  Facility
with the remainder to be used to satisfy working capital requirements and fund a
portion of the Company's future exploration program. After the repayment of debt
the Company has available  approximately $1.5 million under its Revolving Credit
Facility for future borrowings.

Revolving Credit Facility

    During July 1995, the Company entered into a revolving  credit facility (the
"Revolving  Credit  Facility") with a bank to finance  temporary working capital
requirements.  The  Revolving  Credit  Facility  provided  up to $20  million in
borrowings  limited by a  borrowing  base,  as defined by the  Revolving  Credit
Facility.  The Revolving  Credit Facility  provided for interest at the lender's
prime rate plus 0.75%. The borrowing base was subject to review by the bank on a
quarterly basis and could be adjusted subject to the provisions of the Revolving
Credit  Facility.  Effective April 1, 1998, the Company amended and restated its
Revolving  Credit  Facility to provide a revolving  line of credit of up to $100
million  bearing  interest  at a rate  equal to prime  or LIBOR  plus  1.5% - 2%
depending on the level of borrowing  base  utilization.  The  Company's  initial
borrowing  base  authorized  by the banks was  approximately  $15  million.  The
Revolving  Credit  Facility  is secured by  substantially  all the assets of the
Company.

      Effective   September  29,  1998,  the  Company  had  its  borrowing  base
redetermined and amended its Revolving Credit  Facility.  The initial  borrowing
base authorized by the bank was $15 million.  Beginning  October 1, 1998, and on
the first day of each month  thereafter,  the borrowing  base was required to be
reduced by $550,000.

      The Revolving Credit Facility provides for certain restrictions, including
but not limited to,  limitations on additional  borrowings and issues of capital
stock, sales of its oil and natural gas properties or other collateral, engaging
in merger or  consolidation  transactions  and  prohibitions  of  dividends  and
certain  distributions  of cash or properties and certain  liens.  The Revolving
Credit Facility also contains certain financial covenants.

     Effective  March 1, 1999, the Company and the Bank amended the Revolving  
Credit  Facility to include the following  terms; 1),the initial borrowing base
 is $12 million comprised of a two tranche financing of a $9 million Revolving 
Credit Facility and a $3 million term  facility,  2) Beginning May 1, 1999,  
and on the first day of each month  thereafter,  the Revolving  Credit  Facility
borrowing  base is required to be reduced by $400,000,  3) 75% of prospect sales
will be used to pay down the term facility with the remaining  unpaid term 
facility  balance  maturing on August 31, 1999.  The Company and the Bank also 
amended the  Revolving  CreditFacility to replace the financial covenants on a 
go forward basis with a Tangible Net Worth Covenant and Fixed Charge Covenant. 
TheTangible Net Worth  Covenant  requires that at the end of each quarter the 
Company's  Tangible Net Worth be at least 90% of the Company's  actual tangible 
networth as reported at December 31, 1998 (or  $33,260,720)  plus 50% of 
positive net income and 100% of other  increases in equity for all fiscal  
quarters  ending  subsequent to December 31, 1998.  The Fixed Charge  Covenant  
requires that at the end of each quarterbeginning  June 30, 1999,  the ratio of
annualized  EBITDA (as defined) to the sum of annualized  interest  expense plus
50% of the quarter end loans  outstanding  must be at least 1.25 to 1.00.  
Interest will accrue at a rate of LIBOR plus 1.75% - 2.75% depending on the 
borrowing base utilization.

Accounting Change

         The Company uses the  full-cost  method of  accounting  for its oil and
natural gas  properties.  Under this method,  all  acquisition,  exploration and
development costs that are directly  attributable to the Company's  acquisition,
exploration and development  activities are capitalized in a "full-cost pool" as
incurred.  In the second  quarter  of 1998 and  effective  January 1, 1998,  the
Company  changed its method of accounting  for direct  internal  geological  and
geophysical  ("G&G")  costs to one of  capitalization  of such costs,  which are
directly attributable to acquisition, exploration and development activities, to

                                       14
<PAGE>

oil and natural gas property.  Accordingly, the financial results for the period
ended  March 31,  1998  have  been  adjusted  to give  effect  to the  change in
accounting  method  effective  January 1, 1998.  Prior to the change the Company
expensed these costs as incurred.  The Company  believes the  accounting  change
provides  for a better  matching of  revenues  and  expenses  and  enhances  the
comparability  of its results of operations  with those of other oil and natural
gas companies that follow the full cost method of accounting  (See note 1 to the
consolidated financial statements).

Year 2000

         The Company has  completed its  assessment of the year 2000  processing
issues of its internal  technology  systems,  considering  current financial and
accounting,  production,  land and  geological  computer  systems  and  software
utilized by the Company. Due to the need for improved management reporting,  the
Company is in the process of replacing its existing  financial  and  accounting,
production and land applications with new software which is year 2000 compliant.
Implementation  is expected to be completed on or before September 30, 1999 at a
total cost of  approximately  $235,000.  As of March 31,  1999,  the Company has
incurred  approximately  $180,000 converting to its new financial and accounting
system and software with a majority of the remaining  cost to be incurred  prior
to June 30, 1999.  Production  and land  applications  will be operational on or
before  June 30,  1999.  These  costs  have been  funded  from cash  flows  from
operations and the cost of the new software and necessary hardware upgrades have
been capitalized.  Based on assertions made by vendors, the Company believes its
geological systems and software are year 2000 compliant. In addition the Company
is performing other forms of due diligence to ensure that its geological systems
are compliant.

         The Company is also in the process of evaluating  the risk presented by
potential Year 2000  non-compliance  by third  parties.  Because such risks vary
substantially, companies are being contacted based on the estimated magnitude of
risk  posed to the  Company  by their  year  2000  non-compliance.  The  Company
anticipates that these efforts will continue through 1999 and will not result in
significant costs to the Company.

         The  Company's  assessment  of  its  Year  2000  issues  involves  many
assumptions. There can be no assurance that the Company's assumptions will prove
accurate, and actual results could differ significantly from the assumptions. In
conducting its Year 2000 compliance efforts, the Company has relied primarily on
vendor  representations  with  respect  to  internal  computerized  systems  and
representations   from  third  parties  with  which  the  Company  has  business
relationships and has not independently verified  representations.  There can be
no assurance that these representations will prove accurate. A Year 2000 failure
could result in a business  interruption  that  adversely  effects the Company's
business,  financial  condition  or results of  operations.  Although  it is not
currently aware of any likely business disruptions,  the Company is developing a
contingency plan to address and assess the readiness of its material  suppliers,
customers and other  entities as it relates to year 2000  processing  issues and
expects this work to be completed on or before June 30, 1999. The Company is not
insured for this type of loss should a loss occur.

Accounting Pronouncements

     Derivatives - In June 1998, the Financial Accounting Standards Board issued
Statement of Financial  Accounting Standard No. 133,  "Accounting for Derivative
Instruments and Hedging Activity" ("SFAS 133"). SFAS 133 establishes  accounting
and reporting  standards for derivative  instruments and hedging activities that
require an entity to recognize all derivatives as an asset or liability measured
at fair value. Depending on the intended use of the derivatives,  changes in its
fair value will be  reported  in the period of change as either a  component  of
earnings or a component of other comprehensive income.

                                       15
<PAGE>

     SFAS 133 is  effective  for all fiscal  quarters  beginning  after June 15,
1999.  Earlier  application  of SFAS  133 is  encouraged,  but not  prior to the
beginning of any fiscal  quarter that begins  after  issuance of the  statement.
Retroactive application to periods prior to adoption is not allowed. The Company
has not  quantified  the impact of adoption on its  financial  statements or the
date it intends to adopt.

FORWARD LOOKING STATEMENTS

         The statements contained in all parts of this document,  including, but
not limited to, those relating to the Company's  drilling plans, its 3-D project
portfolio, capital expenditures,  use of Offering proceeds, future capabilities,
the  sufficiency of capital  resources and liquidity to support  working capital
and capital expenditure  requirements,  reinvestment of cash flows and any other
statements  regarding  future  operations,  financial  results,  business plans,
sources of liquidity and cash needs and other statements that are not historical
facts are forward  looking  statements.  When used in this  document,  the words
"anticipate,"  "estimate,"  "expect,"  "may,"  "project,"  "believe" and similar
expressions  are  intended  to be among the  statements  that  identify  forward
looking statements. Such statements involve risks and uncertainties,  including,
but  not  limited  to,  those  relating  to  the  Company's  dependence  on  its
exploratory drilling  activities,  the volatility of oil and natural gas prices,
the need to replace reserves depleted by production,  operating risks of oil and
natural gas  operations,  the  Company's  dependence on its key  personnel,  the
Company's reliance on technological development and possible obsolescence of the
technology  currently used by the Company,  significant capital  requirements of
the Company's  exploration and development and technology  development programs,
the potential  impact of government  regulations,  litigation and  environmental
matters,  the  Company's  ability to manage its growth and achieve its  business
strategy,  competition,  the  uncertainty of reserve  information and future net
revenue estimates,  property acquisition risks and other factors detailed in the
Company's  Form  10-K  and  other  filings  with  the  Securities  and  Exchange
Commission.  Should one or more of these risks or uncertainties materialize,  or
should  underlying  assumptions  prove  incorrect,   actual  outcomes  may  vary
materially from those indicated.



                                       16
<PAGE>


                          PART II - OTHER INFORMATION

Item 1 - Legal Proceedings...............................................   None

Item 2 - Changes in Securities and Use of Proceeds.......................   None

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.  The following exhibits are filed as part of this report:

                                                      INDEX TO EXHIBITS
Exhibit No.
--------------

+2.1              --        Amended  and  Restated  Combination  Agreement  by 
                  and among (i) Edge  Group II  Limited  Partnership,  (ii)
                  Gulfedge Limited Partnership,  (iii) Edge Group Partnership, 
                  (iv) Edge Petroleum Corporation,  (v) Edge Mergeco, Inc.
                  and (vi) the Company,  dated as of  January 13,  1997  
                  (Incorporated  by reference  from exhibit 2.1 to the Company's
                  Registration Statement on Form S-4 (Registration No.333-17269)

+3.1             --        Restated Certificate of Incorporated of the Company, 
                  as amended  (Incorporated by reference from exhibit 3.1
                  to the Company's Registration Statement on Form S-4 
                 (Registration No. 333-17269)).

+3.2             --        Bylaws of the Company  (Incorporated by reference 
                  from exhibit 3.2 to the Company's  Registration  Statement
                  on Form S-4 (Registration No. 333-17269)).

+4.1              -- Amended and Restated Credit Agreement, dated April 1, 1998,
                  by and between Edge Petroleum  Corporation  and Edge Petroleum
                  Exploration Company  (collectively the "Borrower") and Compass
                  Bank, a Texas state chartered  banking  institution,  as Agent
                  for  itself  and  First  National  Bank of  Chicago  and other
                  lenders party  thereto.  (Incorporated  by Reference to 4.1 to
                  the Company's Quarterly Report on Form 10-Q for, the quarterly
                  period ended March 31, 1998).

+4.2              -- First Amendment dated September 29, 1998 to the Amended and
                  Restated Credit  Agreement,  dated as of April 1, 1998, by and
                  between the Borrower and the First National Bank of Chicago as
                  agent and a Lender thereto  (Incorporated  by Reference to 4.1
                  to the  Company's  Quarterly  Report  on Form  10-Q  for,  the
                  quarterly period ended March 31, 1998).

+4.3              --  Security  Agreement,  dated as of April  1,  1998,  by and
                  between the Borrower and Compass Bank, a Texas state chartered
                  banking  institution,  as  Agent  for  itself  and  The  First
                  National  Bank of Chicago and other  lenders party thereto the
                  Credit  Agreement  (Incorporated  by  Reference  to 4.1 to the
                  Company's  Quarterly  Report on Form 10-Q for,  the  quarterly
                  period ended March 31, 1998).

                                       17
<PAGE>

+4.4              -- Security  Agreement  (Stock  Pledge),  dated as of April 1,
                  1998, by and between Edge  Petroleum  Corporation  and Compass
                  Bank, a Texas state chartered  banking  institution,  as Agent
                  for itself and The First  National  Bank of Chicago  and other
                  lenders party thereto the Credit  Agreement  (Incorporated  by
                  Reference  to 4.1 to the  Company's  Quarterly  Report on Form
                  10-Q for, the quarterly period ended March 31, 1998).

                            The Company is a party to several  debt  instruments
                  under which the total amount of securities authorized does not
                  exceed  10%  of  the  total  assets  of the  Company  and  its
                  subsidiaries  on a consolidated  basis.  Pursuant to paragraph
                  4(iii)(A) of Item 601(b) of Regulation S-K, the Company agrees
                  to furnish a copy of such  instruments to the Commission  upon
                  request.

+10.1             -- Joint Venture  Agreement  between Edge Joint Venture II and
                  Essex Royalty Limited Partnership II, dated as of May 10, 1994
                  (Incorporated  by reference from exhibit 10.2 to the Company's
                  Registration   Statement   on  Form  S-4   (Registration   No.
                  333-17269)).

+10.2             -- Joint Venture  Agreement  between Edge Joint Venture II and
                  Essex Royalty Limited Partnership,  dated as of April 11, 1992
                  Incorporated  by reference  from exhibit 10.3 to the Company's
                  Registration   Statement   on  Form  S-4   (Registration   No.
                  333-17269)).

+10.3             -- Registration  Rights Agreement between Edge Holding Company
                  Limited Partnership and the Company (Incorporated by reference
                  from exhibit 10.6 to the Company's  Registration  Statement on
                  Form S-4 (Registration No.
                  333-17269)).

+10.4             --        Form of Indemnification  Agreement between the 
                  Company and each of its directors  (Incorporated by reference
                  from exhibit 10.7 to the Company's Registration Statement on 
                  Form S-4 (Registration No. 333-17269)).

+10.5             --        Incentive Plan of Edge Petroleum  Corporation  
                  (Incorporated by reference from exhibit 10.3 to the Company's
                  Quarterly Report on Form 10-Q for the quarter ended June 30,
                  1997).

+10.6             -- Employment  Agreement  dated February 25, 1997 between Edge
                  Petroleum  Corporation  and John E. Calaway  (Incorporated  by
                  reference from exhibit 10.4 to the Company's  Quarterly Report
                  on Form 10-Q for the quarter ended June 30, 1997).

                                       18
<PAGE>
+10.7             -- Employment  Agreement  dated February 25, 1997 between Edge
                  Petroleum  Corporation and James D. Calaway  (Incorporated  by
                  reference from exhibit 10.5 Company's Quarterly Report on Form
                  10-Q for the quarter ended June 30, 1997).

+10.8             -- Employment  Agreement dated as of December 19, 1996, by and
                  between  the  Company  and  Michael G. Long  (Incorporated  by
                  reference from exhibit 10.1 to the Company's  Quarterly Report
                  on Form 10-Q for the  quarterly  period  ended  September  30,
                  1998).

+10.9             --        Purchase  Agreement between the Company and James C.
                  Calaway dated as of December 2,  1996  (Incorporated by
                  reference from exhibit 10.11 to the Company's Registration 
                  Statement on Form S-4 (Registration No. 333-17269)).

+10.10           --        Consulting  Agreement of James C. Calaway dated March
                  18, 1989 (Incorporated by reference from exhibit 10.12
                  to the Company's Registration Statement on Form S-4 
                  (Registration No. 333-17269)).

+10.11            --        Stock Option Plan of Edge  Petroleum  Corporation, 
                  a Texas  corporation  (Incorporated  by  reference  from
                  exhibit 10.13 to the Company's Registration Statement on Form
                  S-4 (Registration No. 333-17269)).

+10.12           --        Employment Agreement dated as of November 16, 1998, 
                  by and between the Company and John W. Elias. (Incorporated by
                  reference from exhibit 10.12 in the Company's Annual Report 
                  on Form 10K for the year ended December 31, 1998)

+10.13           --        Agreement dated as of November 16,1998 by and between
                  the Company and John E. Calaway. (Incorporated  by reference 
                  from exhibit 10.13 in the Company's Annual Report on Form 10K
                  for the year ended December 31, 1998)

 11.1             --       Computation of Earnings Per Share.

 27.1             --       Financial Data Schedule.

  + Incorporated by reference as indicated.

             (B)  Reports on Form 8-K..................................   None

                                       19
<PAGE>



                                                          SIGNATURES



         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                                 EDGE PETROLEUM CORPORATION,
                                                    A DELAWARE CORPORATION
                                                         (REGISTRANT)



Date           5/11/99                              /S/      John W. Elias
-----------------------                           ------------------------------
                                                             John W. Elias
                                                    Chief Executive Officer and
                                                       Chairman of the Board

Date           5/11/99                              /S/    James D. Calaway
-----------------------                           ------------------------------
                                                           James D. Calaway
                                                   Chief Operations Officer and
                                                        President and Director

Date           5/11/99                              /S/    Michael G. Long
-----------------------                          -------------------------------
                                                           Michael G. Long
                                                      Senior Vice President and
                                                       Chief Financial Officer

Date           5/11/99                             /S/     Brian C. Baumler
-----------------------                          -------------------------------
                                                           Brian C. Baumler
                                                      Controller and Treasurer











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