<PAGE>


                                March 23, 1999







Securities and Exchange Commission
450 Fifth St., N.W.
Judiciary Plaza
Washington, D.C.  20549-1004

Via Edgar Electronic Filing System

                                                      In Re:  File Number 0-9219
                                                              ------------------

Gentlemen:

                Pursuant  to   regulations   of  the   Securities  and  Exchange
Commission,   submitted  herewith for  filing on behalf  of  Avoca, Incorporated
(the "Company")  is the Company's  Report  on  Form  10-KSB for the period ended
December 31, 1998.

                This  filing is being  effected  by direct  transmission  to the
Commission's EDGAR System.

                                               Sincerely,


                                               /s/ Guy C. Lyman, Jr.
                                               ---------------------------------
                                               Guy C. Lyman, Jr.
                                               Attorney at Law
                                               Milling Benson Woodward L.L.P.
                                               (504) 569-7160

GCL/kfl
<PAGE>

                                 UNITED STATES
                       Securities and Exchange Commission
                             Washington, D.C. 20549
                                   FORM 10-KSB

X /   Annual report pursuant to Section 13 or 15(d)  of  the Securities Exchange
---   Act of 1934 for the fiscal year ended December 31, 1998
                                          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 0-9219       

                               AVOCA, INCORPORATED
                 (Name of small business issuer in its charter)

                     Louisiana                                  72-0590868   
-----------------------------------------------------    -----------------------
         (State or other jurisdiction of                    (I.R.S. Employer
          incorporation or organization)                  Identification Number

228 St. Charles Avenue, Suite 838, New Orleans, LA               70130          
-----------------------------------------------------    -----------------------
     (Address of principal executive offices)                  (Zip Code)

Registrant's telephone number      (504) 552-4720         
                             ------------------------

Securities registered under Section 12(b) of the Act:
               Title of each class                      Name of each exchange on
                                                             which registered
                          None                                    None    
-----------------------------------------------------   ------------------------

Securities registered under Section 12(g) of the Exchange Act:
                          Common Stock - No Par Value
                          ---------------------------
                                (Title of Class)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that  registrant  was  required to file such  reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes X  No
                                                             ---   ---

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB.
                              ---

State issuer's revenues for its most recent fiscal year.  $734,747
                                                        ----------

The  aggregate   market  value  of  common  stock  held  on  March  1,  1999  by
non-affiliates of the registrant was $5,487,563. Such value has been computed on
the basis of the  average  bid and asked  prices of the stock and by  excluding,
from the 830,500 shares  outstanding on that date, all stock  beneficially owned
by officers and directors of the  registrant  and by  beneficial  owners of more
than  five  percent  of its  stock,  even  though  all such  persons  may not be
affiliates as defined in SEC Rule 12b-2.

The Company has only one class of common  stock,  of which  830,500  shares were
outstanding on March 1, 1999.

Parts I and II  incorporate by reference  information  from the Annual Report to
Shareholders  for the year ended  December 31, 1998.  Part III  incorporates  by
reference  information  from the Company's  Proxy  Statement  dated February 18,
1999.

Transitional Small Business Disclosure Format (check one):  Yes     No X 
                                                               ---    ---

An exhibit index is located on page 15


<PAGE>



                                                        
                               AVOCA, INCORPORATED

                          Index to 10-KSB Annual Report



                                                                            PAGE
PART I                                                                      ----

Item 1:          Description of Business                                     3-8
Item 2:          Description of Property                                     8-9
Item 3:          Legal Proceedings                                             9
Item 4:          Submission of Matters to a Vote of Security Holders           9


PART II

Item 5:          Market for Common Equity
                 and Related Stockholder Matters                              10
Item 6:          Management's Discussion and Analysis or Plan of
                 Operation                                                    10
Item 7:          Financial Statements                                         10
Item 8:          Changes In and Disagreements With Accountants on
                 Accounting and Financial Disclosure                       10-11


PART III

Item 9:          Directors, Executive Officers, Promoters and
                 Control Persons; Compliance With Section 16(a)
                 of the Exchange Act                                          11
Item 10:         Executive Compensation                                       11
Item 11:         Security Ownership of Certain Beneficial Owners
                 and Management                                               11
Item 12:         Certain Relationships and Related Transactions               12
Item 13:         Exhibits and Reports on Form 8-K                          12-13


                                                              Page 2 of 15 Pages


<PAGE>


                                     PART I

Item 1     Description of Business
------     -----------------------

           Avoca, Incorporated ("the Company") is a Louisiana corporation formed
in 1931. It owns and manages approximately 16,000 acres comprising virtually all
of Avoca Island, which is located about 90 miles west of New Orleans in St. Mary
Parish,  Louisiana,  adjacent to and  immediately  southeast of Morgan City. The
island,  approximately  two-thirds of which is under shallow water, is rural and
virtually  undeveloped except for exploration and development of its oil and gas
resources.
           Avoca, Incorporated is a passive royalty company that derives most of
its income from  royalties,  bonuses and delay  rentals under oil and gas leases
covering its Avoca Island  acreage,  as well as seismic  permits and interest on
its  investments.  The  following  table  and  accompanying  lease  map  furnish
information  respecting mineral leases in effect for the year ended December 31,
1998.

                                                              Page 3 of 15 Pages
<PAGE>
<TABLE>
<CAPTION>

MINERAL INCOME

------------------------------------------------------------------------------------------------------------------------------------
Year Ended December 31, 1998
                                                                                                           Income Recognized in 1998
                                                                                                 Initial   Lease Bonus        
                                                               Date of                           Rental    or Delay   
Lessee                          Operator                       Lease     Acreage  Expiration     Per Acre  Rental     Net Royalties 
------------------------------------------------------------------------------------------------------------------------------------
<S>                             <C>                            <C>        <C>     <C>               <C>    <C>             <C>     
Texaco, Inc.                    Texaco, Inc.                   5/17/63    41.900  Termination       $ 75   $     --        $    110
                                                                                  of production

Alliance Operating Company      Delta Operating Corporation    8/14/87   276.733  Termination       $200         --         135,991
                                                                                  of production

Burlington Resources Oil & Gas  Burlington Resources Oil       8/12/96   420.000  Termination       $110     46,200              --
Company                         & Gas Company                                     of production
                                                                                  or 8/12/99 if
                                                                                  nonproducing

Burlington Resources Oil & Gas  Burlington Resources Oil     12/12/97  1,050.000  Termination       $150    157,500              --
Company                         & Gas Company                                     of production
                                                                                  or 12/12/00 if
                                                                                  nonproducing

The Meridian Resource           The Meridian Resource         5/27/98    487.490  Termination       $200     97,498              --
& Exploration, Inc.*            & Exploration, Inc.*                              of production
                                                                                  or 5/27/01 if
                                                                                  nonproducing

The Meridian Resource           The Meridian Resource         5/27/98    627.100  Termination       $200    125,420              --
& Exploration, Inc.*            & Exploration, Inc.*                              of production
                                                                                  or 5/27/01 if
                                                                                  nonproducing

                                                                                                           $426,618        $136,101
                                                                                                           ========        ========

*---Formerly Texas Meridian Resources Exploration, Inc.
</TABLE>

                                                              Page 4 of 15 Pages
<PAGE>



                                                                        









                       [Map of Avoca Island appears here,
                    showing property of Avoca, Incorporated,
                       mineral leases and well locations]





                                                              Page 5 of 15 Pages
<PAGE>


Item 1     Description of Business (continued)
------     -----------------------------------

           At December 31, 1998,  2,903 acres of the Company's land were covered
by oil and gas leases.  Approximately 319 acres were held by production pursuant
to leases (in favor of Texaco,  Inc. and Alliance  Operating  Company) providing
for royalties  ranging from 25% to 30%. The remaining 2,584 acres are covered by
leases in favor of  Burlington  Resources  Oil and Gas Company and The  Meridian
Resource  &  Exploration,  Inc.  The first  Burlington  lease,  granted in 1996,
stipulates a 21% royalty and the second lease, granted in 1997, stipulates a 22%
royalty.  The two leases granted to The Meridian  Resource &  Exploration,  Inc.
stipulate  a 25%  royalty  from the surface to 12,500 feet and 23% for all lower
depths.
           In recent years, the Delta Operating  Corporation  (formerly Alliance
Operating  Company)  Avoca No. 1 well in the Ramos Field has been the  Company's
largest  producing  well,  Royalties  from the  Avoca  No.  1, in  which  Avoca,
Incorporated has a net revenue  interest of approximately  19%, were responsible
for  approximately  66% of the Company's royalty income during 1996, 74% in 1997
and 99% in 1998.  Production from the well was 311,345 thousand cubic feet (mcf)
of gas and 4,206  barrels of  condensate in 1998 as compared with 245,165 mcf of
gas and 3,604 barrels of  condensate in 1997,  and 238,455 mcf and 3,787 barrels
in 1996.
           The   Intercoastal  Shipyard No. 2  well,  operated  by  Black   Gold
Production  Company  under the Capital Energy, Inc. lease dated January 2, 1996,
ceased production on April 8, 1997 and has been plugged and abandoned. The well,
also located in the Ramos Field contributed $54,327 of royalty income in 1997.
           The Company's  share of production  from the Bateman Lake Field tract
leased to Texaco, Inc. has been negligible in recent years.

                                                              Page 6 of 15 Pages
<PAGE>


           In addition to  information  regarding  prices,  the following  table
shows the Company's  share of gas produced (in terms of thousand cubic feet) and
oil  delivered  (in terms of barrels) from the Ramos Field during the last three
years.
              Company's Share                         Average Sales Price
              ---------------                         -------------------
 Year     Gas Volume       Oil Volume             Per mcf             Per bbl
 1996     82,228 mcf       1,770 bbls              $2.81               $21.66
 1997     56,537 mcf         941 bbls              $2.83               $20.84
 1998     60,587 mcf         818 bbls              $2.28               $12.62

         The Company granted two mineral leases in each of the last three years.
Except for reworking operations,  no drilling operations were conducted on Avoca
Island during the three year period ended December 31, 1998.
         Further information  respecting oil and gas operations on the Company's
property   appears  under  the  captions  "Report  to  the   Shareholders"   and
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  on  pages  4  and  14  of  the  Company's  1998  Annual  Report  to
Shareholders,   attached  as  an  exhibit  hereto  and  incorporated  herein  by
reference.  The Company's  activities with respect to oil and gas are limited to
the granting of leases,  seismic  permits and the  collection of bonuses,  delay
rentals  and  landowner   royalties   thereunder.   Accordingly,   only  limited
information,  furnished  primarily by the Company's  lessees,  has been included
with respect to oil and gas operations  affecting the Company's lands.  Complete
information  respecting these and related matters,  such as proved reserves,  is
unavailable to the Company and cannot be obtained without unreasonable effort or
expense.

                                                              Page 7 of 15 Pages
<PAGE>


         Wild game,  bird  hunting and  non-commercial  fishing  rights on Avoca
Island are leased to the Avoca Duck Club. A seven year cattle lease has recently
been signed on 600 acres,  which will minimize future  expenditures  toward land
clearing and fence maintenance.
         The  Company  has no  employees  but  retains  the  services  of  three
individuals as independent  contractors.  One acts as consultant to the Board of
Directors and assists with the Company's day to day business affairs.  The other
two  individuals  maintain the  Company's  financial  records and watch over the
Company's lands, respectively.
         Additional  information  regarding the  Company's  business is included
under Item 2 of this report, incorporated herein by
reference.

Item 2   Description of Property
------   -----------------------

         The Company owns approximately 16,000 acres comprising virtually all of
Avoca Island. The island, located in St. Mary Parish,  Louisiana,  approximately
90 miles west of New Orleans,  lies  southeast of the greater  Morgan City area,
from which it is separated by Bayou Boeuf. There are no bridges or roads leading
to the island.  Access is by means of a free ferry  which  operates on a regular
schedule across Bayou Boeuf (a distance of approximately  500 feet) and connects
the  northwest  tip of the island  with the Morgan City area.  Ferry  service is
interrupted by periodic mechanical breakdowns and during periods of high water.
         Avoca  Island is within the Morgan City Harbor and  Terminal  District.
Bayou  Boeuf  and Bayou  Chene,  which  border  the  island  for a  distance  of
approximately  thirteen  miles  and  form its  northern,  eastern  and  southern
perimeters, are part of the Gulf section of the Intracoastal Waterway.
         Approximately  one-third of the island,  located along its northern and
eastern  perimeters,  is dry ground.  The remaining  two-thirds is under shallow
water. Avoca Island is rural, and its surface is virtually undeveloped.

                                                              Page 8 of 15 Pages
<PAGE>


         Over the years,  preliminary  studies and proposals have been made with
regard  to  a  bridge linking  Avoca  Island with the mainland but no definitive
action has resulted from these efforts. With the Company's  cooperation,  a  new
feasibility study concerning industrial development of Avoca Island has recently
been completed  by  the  St. Mary Parish government and is being reviewed by the
Company and others.
         A study  conducted with the assistance of LSU's  Cooperative  Extension
Service in 1991 indicates that aquaculture and tree farming are not economically
feasible and that the island's  suitability for farming is limited.  The Company
is  continuing  its  search  for ways to  prudently  develop  Avoca  Island  for
agricultural  and  commercial  use. In addition to ongoing  surface  maintenance
operations  and its long  standing  lease of hunting and  fishing  rights to the
Avoca Duck Club,  the Company  recently  signed a cattle  grazing lease covering
approximately 600 acres on the northern and western parts of the island.
         Information  respecting  development of oil and gas resources  on Avoca
Island  is  provided  under  Item  1  of  this  report,  incorporated  herein by
reference.

Item 3   Legal Proceedings
------   -----------------

         Not applicable.

Item 4   Submission of Matters to a Vote of Security Holders
------   ---------------------------------------------------

         Not Applicable


                                                              Page 9 of 15 Pages
<PAGE>


                                     PART II

Item 5   Market for Common Equity and Related Stockholder Matters
------   --------------------------------------------------------

         The  information  called  for by this item  appears  under the  caption
"Stock Prices and Related  Security  Holder Matters" on page 15 of the Company's
1998  Annual  Report  to  Shareholders,   attached  as  an  exhibit  hereto  and
incorporated herein by reference.

Item 6   Management's Discussion and Analysis or Plan of Operation
------   ---------------------------------------------------------

         The  information  called for by this item  appears  under the  captions
"Report to the  Shareholders"  and  "Management's  Discussion  and  Analysis  of
Financial Condition and Results of Operations" on pages 4 and 14,  respectively,
of the  Company's  1998 Annual  Report to  Shareholders,  attached as an exhibit
hereto and incorporated herein by reference.

Item 7    Financial Statements
------    --------------------

         The  information  called for by this item appears on pages 5 through 13
of  the  Company's  1998  Annual Report to  Shareholders, attached as an exhibit
hereto and incorporated herein by reference.

Item 8    Changes In and Disagreements With 
          Accountants on Accounting and Financial Disclosure
------    --------------------------------------------------

         The following  information is included in the Form 8-K Report which the
Company filed with the Securities  and Exchange  Commission on February 4, 1999.
With the approval of the Company's  Board of Directors  and  effective  upon the
filing of the Company's Form 10-KSB for the year ended December 31, 1998,  Ernst
& Young  LLP  has  decided  not to  stand  for  reappointment  as the  Company's
independent public  accountants.  There were no disagreements with Ernst & Young
LLP and its reports have contained no adverse opinion,  disclaimer of opinion or
modification as to uncertainty, audit scope or accounting principles.

                                                             Page 10 of 15 Pages
<PAGE>


         Effective  March 16,  1999,  Andersen  LLP has been  engaged to succeed
Ernst & Young LLP as the Company's independent public accountants for 1999.

                                    PART III

Item 9    Directors, Executive Officers,
          Promoters and Control Persons; Compliance
          With Section 16(a) of the Exchange Act
------    -----------------------------------------

         The Company has two  executive  officers,  both of whom are  directors:
Richard W. Fox,  President,  and M. Cleland  Powell,  III,  Secretary-Treasurer.
Information  concerning  such persons and the Company's other directors is shown
under the caption  "Number and  Election of  Directors"  on pages 3 and 4 of the
Company's  Proxy  Statement  dated  February  18, 1999,  incorporated  herein by
reference.  The balance of the information called for by this item appears under
the caption "Section 16A Beneficial Ownership Reporting Compliance" on page 5 of
the Company's Proxy Statement  dated February 18, 1999,  incorporated  herein by
reference.

Item 10   Executive Compensation
-------   ----------------------

           The information called for by this  item  appears  under the  caption
"Information  Concerning  Management  - Executive Compensation" on page 5 of the
Company's  Proxy  Statement  dated  February 18, 1999,  incorporated  herein  by
reference.

Item 11    Security Ownership of Certain Beneficial Owners and Management
-------    --------------------------------------------------------------
 
            The  information  called  for by this item appears under the caption
"Voting Securities" on pages 2 and 3, and under the caption "Number and Election
of Directors" on pages 3 and 4, of the Company's  Proxy Statement dated February
18, 1999, incorporated herein by reference.

                                                             Page 11 of 15 Pages
<PAGE>

Item 12       Certain Relationships and Related Transactions
-------       ----------------------------------------------

              The information  called for by this item appears under the caption
"Information  Concerning  Management - Certain  Relationships"  on page 5 of the
Company's  Proxy  Statement  dated  February  18, 1999,  incorporated  herein by
reference.

                                     PART IV

Item 13       Exhibits and Reports on Form 8-K
-------       --------------------------------

(a)1.         Financial Statements

              The  following  financial   statements  of  Avoca,   Incorporated,
included  in its  1998  Annual  Report  to  Shareholders,  are  incorporated  by
reference in Part II, Item 7:
              Report  of  Ernst & Young LLP, Independent Auditors, dated January
13, 1999

              Balance sheet - December 31, 1998

              Statements of Income - years ended
              December 31, 1998 and 1997

              Statements of Retained Earnings -
              years ended December 31, 1998 and 1997

              Statements of Cash Flows - years ended
              December 31, 1998 and 1997

              Notes to Financial Statements -
              December 31, 1998

(a)2.         Exhibits required by Item 601 of Regulation S-B:

              3.1       Copy of Composite Charter(1)

              3.2       Copy of Charter, dated October 21, 1931(1)

              3.3       Copy of amendment to Charter, dated
                        September 13, 1972(1)

              3.4       Copy of amendment to Charter, dated
                        May 30, 1975(1)

                                                             Page 12 of 15 Pages
<PAGE>



              3.5       Copy of amendment to Charter, dated
                        September 15, 1981(2)

              3.6       Copy of amendment to Charter, dated
                        March 17, 1987(2)

              3.7       Copy of Composite Charter (as of
                        August 14, 1987)(2)

              4.0       Copy of specimen stock certificate(1)

              13        Annual Report to Shareholders for
                        the year ended December 31, 1998.  Except for
                        the information expressly specifically
                        incorporated by reference in this Form 10-KSB,
                        the annual report is provided solely for the
                        information of the Securities and Exchange
                        Commission and is not to be deemed filed
                        as part of the Form 10-KSB.

              23        Consent of independent auditors

              27        Financial Data Schedule

(b)           Reports on Form 8-K

                        A Form  8-K,  dealing  with a  change  in the  Company's
accountants, was filed on February 4, 1999.


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

1     Incorporated  by  reference  from  registrant's   Form 10     Registration
      Statement,  filed with the Securities and Exchange Commission on April 29,
      1980, Commission file number 0-9219.

2     Incorporated by reference from registrant's Form 8 Report dated August 14,
      1987, Commission file number 0-9219.


                                                                   Page 13 of 15
<PAGE>


                                   SIGNATURES
                                   ----------

              Pursuant to the  requirements  of Section 13 of the Securities Act
of 1934,  the  registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

Avoca, Incorporated

       /s/ Richard W. Fox
By:    ----------------------------------
       Richard W. Fox
       President and principal executive,
       financial and accounting officer

Date: March 16, 1999
      -----------------------------------

              Pursuant to the  requirements  of the  Securities  Exchange Act of
1934,  this report has been signed below by the  following  persons on behalf of
the registrant and in the capacities and on the dates indicated.

/s/ Robert C. Baird, Jr. 
--------------------------------
Robert C. Baird, Jr., Director

Date: March 16, 1999
      --------------------------           

/s/ Richard W. Fox
--------------------------------
Richard W. Fox, Director

Date: March 16, 1999
      --------------------------           

/s/ Guy C. Lyman, Jr.
--------------------------------
Guy C. Lyman, Jr., Director

Date: March 16, 1999
      --------------------------

/s/ M. Cleland Powell, III
--------------------------------
M. Cleland Powell, III, Director

Date: March 16, 1999
      --------------------------

/s/ J. Scott Tucker
--------------------------------
J. Scott Tucker, Director

Date: March 16, 1999
      --------------------------

                                                             Page 14 of 15 Pages
<PAGE>


                                  Exhibit Index


                                                                  Sequentially
                                                                    Numbered
    Exhibit No.     Description                                       Page      
    -----------     ---------------------------------------        ------------

        3.1         Copy of Composite Charter (1)

        3.2         Copy of Charter, dated October 21, 1931(1)

        3.3         Copy of amendment to Charter, dated September
                    13, 1972(1)

        3.4         Copy of amendment to Charter, dated May
                    30, 1975(1)

        3.5         Copy of amendment to Charter, dated
                    September 15, 1981(2)

        3.6         Copy of amendment to Charter, dated 
                    March 17, 1987(2)

        3.7         Copy of Composite Charter (as of August
                    14, 1987)(2)

        4.0         Copy of specimen stock certificate(1)

        13          Annual Report to Shareholders  for the year
                    ended December 31, 1998. Except for
                    the information  expressly  specifically
                    incorporated by reference in this Form
                    10-KSB,  the  annual  report  is  provided
                    solely  for the  information  of the
                    Securities and Exchange  Commission and is
                    not to be deemed filed as part of the
                    Form 10-KSB.

        23          Consent of independent auditors


        27          Financial Data Schedule





--------------------
(1) Incorporated by reference from registrant's Form 10 Registration  Statement,
filed with the Securities and Exchange Commission on April 29, 1980,  Commission
file number 0-9219.
(2) Incorporated by reference from  registrant's  Form 8 Report dated August 14,
1987, Commission file number 0-9219.


                                                             Page 15 of 15 Pages

<PAGE>
                                                                      EXHIBIT 13




















  AVOCA                                                            Annual Report
INCORPORATED                                                           1998




<PAGE>


                            [Blank page appears here]


<PAGE>


Description of Business

         Avoca,   Incorporated  owns  and  manages  approximately  16,000  acres
comprising  virtually all of Avoca Island,  which is located about 90 miles west
of New  Orleans in St.  Mary  Parish,  Louisiana,  adjacent  to and  immediately
southeast of Morgan City. The island is rural and virtually  undeveloped  except
for exploration and development of its oil and gas resources.

         Avoca,  Incorporated is largely a passive royalty company which derives
most of its income from  royalties,  bonuses and delay rentals under oil and gas
leases covering its Avoca Island acreage.

Directors and Officers

Robert C. Baird, Jr., Director;           M. Cleland Powell, III, Director
Executive Vice President,                 and Secretary-Treasurer;
Whitney National Bank                     Senior Vice President,
                                          Whitney National Bank
Richard W. Fox,
Director and President;                      
President, Fox Financial                  J. Scott Tucker; Director;
Consulting, Inc. and Manager,             President and Chief Executive Officer,
Longford Farm, L.L.C.                     Hellenic, Inc.

Guy C. Lyman, Jr., Director;
Attorney,
Milling, Benson, Woodward, L.L.P.









                                          [Picture of marsh scene appears here.]



                                                        AVOCA, Incorporated    3

<PAGE>

Report to the Shareholders

Issued Preliminary to the Sixty-Seventh
Annual Meeting of Shareholders on March 16, 1999

Dear Shareholders:

         In 1998 average crude oil prices  declined to their lowest levels since
1986.  These  declines  negatively  impacted  the  revenue  and  profits  of oil
operators,   who  have  responded  by  reducing   exploration   and  development
expenditures.  While the 1996-97 period brought renewed interest and 3-D seismic
surveys for  virtually  the entire  Island,  recent  events  have  resulted in a
decrease in exploration budgets,  which directly effects any near term prospects
for further exploration.
         The  Intercoastal  Shipyard  well  ceased  production  in  April  1997,
contributing  to a decline in royalty  revenues.  Lower  prices paid for gas and
condensate also contributed to the decline. The only producing well remaining on
the  Island,  Delta  Operating  Corporation  Avoca  No. 1 well,  experienced  an
increase in production during the year after a chemical  perforation  treatment.
Because  virtually the entire Island was permitted during the 1996-97 period for
3-D seismic  work,  there were no revenues  from  seismic  permits  during 1998.
Similarly,  the  relocation of existing  pipelines  during 1997 was completed in
early 1998, causing a decline in revenues from pipeline rights-of-way.  Revenues
from lease bonuses and delay rentals  decreased,  as Burlington  Resources Oil &
Gas Company elected to drop its lease of a 1,565 acre tract, and to pay only the
minimum  (one-half)  of the delay rental due on its 2,100 acre lease.  Partially
offsetting  this, two new leases  covering a total of 1,114 acres were signed in
1998 with The Meridian Resource & Exploration Company.
         The Company  continues to explore  opportunities for use of the surface
acreage of Avoca  Island in addition to the  current  hunting and fishing  lease
with the Avoca Duck Club. We have recently  signed a seven-year  lease providing
for a cattle  operation on approximately  600 acres,  which will minimize future
expenditures  toward land  clearing and fence  maintenance.  We also continue to
explore other surface development possibilities with local governmental bodies.
         In  conclusion,  although the oil and gas industry  appears headed into
another cycle of low prices,  Avoca,  Incorporated is poised well to face future
challenges.   Chemical   treatment  to  our  current  producing  well  increased
production,  3-D seismic data has been compiled,  which may eventually result in
new wells being drilled,  and the expanded surface activity will result in lower
land maintenance expenses.
         The Company's  operations and financial condition are further discussed
on page 14 of this report and a complete list of mineral  leases is shown inside
the back cover.

                                                         Respectfully submitted,


                                                         Richard W. Fox
                                                         President
February 5, 1999

4   Avoca, Incorporated
<PAGE>


Report of Ernst & Young LLP,
Independent Auditors


The Board of Directors
Avoca, Incorporated


         We have audited the accompanying  balance sheet of Avoca,  Incorporated
as of  December  31,  1998,  and the  related  statements  of  income,  retained
earnings,  and cash flows for each of the two years in the period ended December
31, 1998.  These financial  statements are the  responsibility  of the Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.
         We conducted our audits in accordance with generally  accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
         In our opinion,  the  financial  statements  referred to above  present
fairly, in all material respects, the financial position of Avoca,  Incorporated
at December 31, 1998,  and the results of its  operations and its cash flows for
each of the two years in the period ended December 31, 1998, in conformity  with
generally accepted accounting principles.



                              /s/ Ernst & Young LLP

New Orleans, Louisiana
January 13, 1999


                                                         AVOCA, Incorporated   5
<PAGE>


BALANCE SHEET
                                                                     December 31
                                                                            1998
--------------------------------------------------------------------------------
ASSETS

CURRENT ASSETS
      Cash and cash equivalents                                       $  315,376
      Short-term investments                                           1,662,334
      Accounts receivable                                                 21,589
      Accrued interest receivable                                         28,553
      Prepaid expenses                                                     6,568
                                                                     -----------
                                  TOTAL CURRENT ASSETS                 2,034,420

PROPERTY AND EQUIPMENT
      Land and land improvements                                         613,751
      Buildings and equipment                                             61,950
                                                                     -----------
                                                                         675,701
      Less accumulated depreciation and depletion                        601,121
                                                                     -----------
                                                                          74,580

OTHER ASSETS
      Long-term investments                                              549,664
      Avoca Drainage Bonds, $415,000, in default --
           at nominal amount                                                   1

                                                                      $2,658,665
                                                                     ===========



                     [Picture of U.S. Army Corps of Engineer locks appears here]


6   AVOCA, Incorporated
<PAGE>


                                                                     December 31
                                                                            1998
--------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITES
      Accounts payable and accrued expenses                          $    16,165
      Dividends payable                                                  265,760
      Income taxes payable                                                 1,368
                                                                     -----------
                             TOTAL CURRENT LIABILITIES                   283,293

DEFERRED INCOME TAXES                                                     12,888

SHAREHOLDERS' EQUITY
      Common stock, no par value -- authorized, issued and
           outstanding 830,500 shares (no change during the year)         94,483
      Retained earnings                                                2,268,001
                                                                     -----------
                             TOTAL SHAREHOLDERS' EQUITY                2,362,484






                                                                     $ 2,658,665
                                                                     ===========









See accompanying notes.

                                                         AVOCA, Incorporated   7
<PAGE>


STATEMENTS OF INCOME

                                                      Year ended December 31,

                                                         1998               1997
                                                  ------------------------------
Revenue:
      Royalties                                   $   142,733        $   218,521
         Less severance taxes                           6,632              6,285
                                                  -----------        -----------
                                                      136,101            212,236

      Lease bonuses and delay rentals                 426,618            595,950
      Lease option payments                                --             45,813
      Seismic permit fees                                  --            211,241
      Pipeline rights-of-way                            4,045            138,772
      Interest income                                 133,748            126,356
      Rental income                                    28,000             27,800
      Other                                             6,235              6,403
                                                  -----------        -----------
                                                      734,747          1,364,571
Expenses:
      Attorney fees and expenses                       16,361             12,826
      Auditing fees                                    16,000             16,000
      Bookkeeping and clerical services                 6,000              6,000
      Management fees                                  55,442             46,000
      Directors' fees                                   5,000              5,000
      Geological and engineering fees and expenses     17,491              6,451
      Insurance                                        22,991             22,460
      Office and miscellaneous expenses                30,137             24,421
      Taxes, other than income taxes                   22,243             22,272
      Repairs and cleanup expenses                     42,711             31,732
                                                  -----------        -----------
                                                      234,376            193,162

                      INCOME BEFORE INCOME TAXES  $   500,371        $ 1,171,409

Income taxes                                          172,106            419,111
                                                  -----------        -----------

                                      NET INCOME  $   328,265        $   752,298
                                                  ===========        ===========

Earnings per share (basic and diluted)            $       .40        $       .91
                                                  ===========        ===========

Dividends per share                               $       .32        $       .75
                                                  ===========        ===========


See accompanying notes.

8    AVOCA, Incorporated

<PAGE>


                         STATEMENTS OF RETAINED EARNINGS



                                                      Year ended December 31,
                                                     1998                1997
--------------------------------------------------------------------------------

Retained Earnings:

      Balance at beginning of year                 $2,205,496         $2,076,073

      Net income for the year                         328,265            752,298
                                                   ----------         ----------
                                                    2,533,761          2,828,371

      Cash dividends:
         1998 - $ .32 per share                       265,760                 --
         1997 - $ .75 per share                            --            622,875
                                                   ----------         ----------

                   BALANCE AT END OF YEAR          $2,268,001         $2,205,496
                                                   ==========         ==========






See accompanying notes.
                       [Picture of equipment on gas well location appears here.]

                                                         AVOCA, Incorporated   9
<PAGE>


STATEMENTS OF CASH FLOWS
 
                                                      Year ended December 31,

                                                     1998                1997
                                                  ------------------------------

OPERATING ACTIVITIES
    Net income                                      $   328,265    $    752,298
    Adjustments to reconcile net income to
       net cash provided by operating activities:
        Depreciation expense                              2,735           2,735
        Deferred income taxes                              (507)           (507)
        Change in operating assets and liabilities:
           Accounts receivable                           16,074           6,967
           Accrued interest receivable                    3,077          (7,368)
           Prepaid expenses                              (1,627)            202
           Accounts payable and accrued expenses         (1,868)            927
           Income taxes                                   1,574          (9,427)
                                                    ------------   -------------

                           NET CASH PROVIDED BY
                           OPERATING ACTIVITIES         347,723         745,827

INVESTING ACTIVITIES
    Purchase of short-term investments                 (909,085)       (509,709)
    Purchase of long-term investments                  (931,936)     (1,255,150)
    Maturity of investments                           1,935,679       1,828,000
    Purchase of equipment                                (4,500)             --
                                                     -----------     -----------

                            NET CASH PROVIDED BY
                            INVESTING ACTIVITIES         90,158          63,141

FINANCING ACTIVITIES
    Dividends paid                                     (622,875)       (373,725)
                                                     -----------     -----------

                            NET CASH USED IN
                            FINANCING ACTIVITIES       (622,875)       (373,725)
                                                     -----------     -----------

                            INCREASE (DECREASE) IN
                            CASH AND CASH EQUIVALENTS  (184,994)       (435,243)

Cash and cash equivalents at beginning of year          500,370          65,127
                                                     -----------     -----------

                             CASH AND CASH EQUIVALENTS
                             AT END OF YEAR          $  315,376      $  500,370
                                                     ==========      ===========

See accompanying notes.

10   AVOCA, Incorporated

<PAGE>


                                                   NOTES TO FINANCIAL STATEMENTS

December 31, 1998

NOTE A--Significant Accounting Policies

General: Avoca,  Incorporated (the Company) owns and leases land, located in St.
Mary Parish,  Louisiana,  to unaffiliated  parties for oil and gas  exploration.
Income in the accompanying  financial statements is primarily derived from lease
bonuses, delay rentals, seismic permit fees, sale of rights-of-way and royalties
received  from oil and gas  production  related to these  leases.  Estimates  of
proved reserves related to the leases are not available.

Cash  Equivalents:  Cash equivalents  consists of investments with a maturity of
three months or less from date of purchase.

Investments: Short-term investments consist of United States Government Treasury
Notes with an original  maturity of greater than three months but with  maturity
dates within one year from the balance sheet date.
         Long-term  investments  consist of a United States Government  Treasury
Note due in 2000 and two United States Government agency securities due in 2001.
         Management determines the appropriate classification of debt securities
at the time of purchase  and  reevaluates  such  designation  as of each balance
sheet date. Debt securities are classified as held-to-maturity  when the Company
has the  positive  intent  and  ability  to hold  the  securities  to  maturity.
Held-to-maturity  securities  are stated at  amortized  cost  including  accrued
interest.  At  December  31,  1998  all  short-term  investments  and  long-term
investments  were  classified  as  held-to-maturity.   The  fair  value  of  the
investments approximated the carrying value at December 31, 1998.

Property and  Equipment:  Land is carried at cost less amounts  received for the
sale of rights-of-way and similar servitudes. Land improvements and building are
carried at cost and depreciated over their estimated useful life of 30 years.

Income Taxes:  The Company accounts for income taxes using the liability method.

Use of Estimates:  The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

NOTE B--Income Taxes

The  components  of income tax expense  for the years  ended  December 31 are as
follows:

                                                     1998                  1997
--------------------------------------------------------------------------------

Current
         Federal                                 $172,368              $370,259
         State                                        245                49,359
                                                 --------              --------
                        TOTAL CURRENT             172,613               419,618
                                                 --------              --------

Deferred:
         Federal                                     (462)                 (443)
         State                                        (45)                  (64)
                                                 --------              --------
                        TOTAL DEFERRED               (507)                 (507)
                                                 --------              --------

                                                 $172,106              $419,111
                                                 ========              ========


The deferred income tax liability of $12,888 relates to a difference between the
accounting and income tax basis of property and equipment.

The  Company  paid  income  taxes of  $171,000  and  $430,000  in 1998 and 1997,
respectively.

                                                        AVOCA, Incorporated   11
<PAGE>


NOTES TO FINANCIAL STATEMENTS (Continued)


B. Income Taxes (continued)

The  reconciliations  between  the  federal  statutory  income  tax rate and the
Company's  effective  income tax rate,  based on income  before income taxes and
extraordinary item, for the years ended December 31 are as follows:

<TABLE>
<CAPTION>

                                                                       1998                      1997
                                                               Amount       Rate         Amount           Rate
                                                              -------------------------------------------------
<S>                                                           <C>           <C>         <C>               <C>  
Tax expense based on federal statutory rate                   $170,126      34.0%       $398,279          34.0%
Statutory percentage depletion                                  (7,279)     (1.5)        (11,145)         (0.9)
State income taxes (net of federal income tax deduction)        15,265       3.1          49,380           4.2
Other                                                           (6,006)     (5.2)        (17,403)         (1.5)
                                                              ---------     -----      ----------         -----

                                            INCOME TAXES      $172,106       30.4%      $419,111          35.8%
                                                              =========     =====      ==========         =====
</TABLE>



12   AVOCA, Incorporated


<PAGE>


                                                              NOTES TO FINANCIAL
                                                          STATEMENTS (Continued)

NOTE C--Major Customers

The net royalties received from one independent oil and gas exploration  company
accounted for  virtually all of total net royalties  recorded for the year ended
December 31, 1998 compared to two independent oil and gas exploration  companies
comprising  99% of total net royalties  recorded for the year ended December 31,
1997.  Lease bonus and delay  rental  revenue in 1998 and 1997 was the result of
leases with two and one company,  respectively.  Lease option payments consisted
of payments  from one  company for the year ended  December  31,  1997.  Seismic
permit fees  recognized  in 1997 are the result of permits  with two oil and gas
exploration  companies and one seismic company,  of which, one company accounted
for 89% of the revenue in 1997.  Pipeline  rights-of-way  revenue  recognized in
1998 and 1997 resulted from rights-of-way agreements with one and two companies,
respectively.


NOTE D--Related Party Transactions

A member of the Board of  Directors is of counsel with the law firm which serves
as legal  counsel for the  Company.  Fees paid to this law firm were $15,111 and
$13,676 for the years ended December 31, 1998 and 1997, respectively.


NOTE E--Oil and Gas Quantities Produced

The  following  table  reflects the  Company's  share of the oil and gas volumes
produced from leases held under production during each of the last two years:

                                                           Production         
                                                  ----------------------------
                                                     Oil                 Gas
                                                    (BBLs)              (MCFs)
                                                  ----------------------------
1998                                                 818                60,587
1997                                                 941                56,537



NOTE F--Commitment

The  Company  has a lease  with the Avoca  Duck Club (the  Club),  an  unrelated
entity,  to allow the  members of the Club use of the island for the  purpose of
hunting  wild game and birds,  and for  noncommercial  fishing.  The term of the
lease  commenced June 1, 1994 for a period of ten years with the Club having two
ten-year  options to extend the  lease.  Under the terms of the lease,  the Club
constructed a new building  including a separate apartment for the exclusive use
of the Company's  caretaker of the island.  This building  replaced the building
destroyed by fire in December 1992.  During 1994,  under the terms of the lease,
the Company  contributed  $50,000,  which  represents  the  approximate  cost to
construct the apartment.

If the Company elects to exercise its unrestricted, unconditional and absolutely
discretionary  right to  terminate  the lease  before  the end of its term,  the
Company  must  reimburse  the  Club  for its  unamortized  cost of the  building
(excluding the Company's cash contribution), based on straight-line depreciation
over 30 years. Under the lease, the Club's unamortized cost of the building will
be reduced over time to an ultimate reimbursable amount not less than $80,000.





                                       [Picture of old steam pump appears here.]

                                                        AVOCA, Incorporated   13

<PAGE>


Management's Discussion and
Analysis of Financial Condition and
Results of Operations



Liquidity and Capital Resources
The Company's continued liquidity is evidenced by the fact that more than 95% of
its  assets,  as measured by book  value,  are cash and cash  equivalents,  U.S.
Government and U.S.  Government agency securities.  Current  liabilities at year
end were $283,293,  including a $265,760  dividend declared in December 1998 but
not paid until  January  1999.  The  Company's  business is largely  passive and
consequently  all  capital   requirements   for  exploration,   development  and
production of the Company's mineral resources are funded by its lessees. Current
financial  resources and  anticipated  net income are expected to be adequate to
meet cash requirements in the year ahead.

1998 As Compared to 1997
Revenues for 1998  decreased by $629,824 or  approximately  46% largely  because
Burlington  Resources  Oil & Gas Company  elected not to pay the $234,750  delay
rental due December  12, 1998 on a 1,565 acre oil, gas and mineral  lease and to
pay only the minimum delay rental (equal to half of the $315,000 due) on a 2,100
acre lease.  The  decrease  would have been  greater but for receipt of $222,918
from The Meridian Resource & Exploration Company,  Inc. (formerly Texas Meridian
Resources  Exploration,  Inc.) for two new oil, gas and mineral leases.  The new
leases  totaling  1,114 acres were granted  under an option  included in a 7,535
acre 3-D seismic permit acquired from the Company in 1996.
         No new 3-D seismic  permits were  granted in 1998 whereas  $211,241 was
received from this source in the prior year.  Pipeline  rights-of-way  decreased
$134,727 because only one minor permit was granted in 1998.
         Royalty   income  net  of   severance   taxes   decreased   $76,135  or
approximately  36% primarily  because of the absence of royalty  income from the
Intercoastal  Shipyard No. 2 well. The well, which ceased production on April 8,
1997, contributed $54,327 of royalty income in 1997.
         The overall  performance of the Delta Operating  Corporation  (formerly
Alliance  Operating  Company)  Avoca  No.  1 well,  which  was  responsible  for
virtually all of the Company's royalty income in 1998, improved during the year.
Total gas and  condensate  recoveries  from the well (in which the Company has a
net revenue interest of approximately 19%) increased from 245,165 Mcf of gas and
3,604  barrels of  condensate in 1997 to 311,345 Mcf of gas and 4,206 barrels of
condensate  in 1998.  The operator has told the Company that the increase in gas
production   results  from  a  successful   chemical   treatment  to  clean  the
perforations and the producing formation near the wellbore in September of 1998.
The average 1998 sales prices from the Delta No. 1 Avoca well were approximately
$2.28 per Mcf of gas and $12.62 per barrel of  condensate  as  compared to $2.89
per Mcf of gas and $20.22 per barrel of condensate in 1997.
         Interest  income  on  U.S.   Government  and  U.S.   Government  agency
securities  increased  $7,392 or approximately 6% because of the availability of
increased funds for investment.
         Overall expenses were $41,214 or approximately  21% higher in 1998 than
in 1997.  The $3,535  increase  in  attorney  fees and the  $11,039  increase in
geological and engineering  fees resulted  primarily from the increased need for
these  services  due to  increased  mineral  activity.  The $9,442  increase  in
consultant  fees results from the hiring of a new part-time land manager and, to
a lesser extent,  from the larger bonus paid to the Company's  general manger in
recognition of  commendable  results  achieved in 1997.  The $5,717  increase in
office and  miscellaneous  expenses  resulted  primarily from  increased  annual
meeting expenses and expenses  attributable to surface  management.  The $10,979
increase in repairs and cleanup  expenses  is  attributable  to ongoing  surface
maintenance on the northern part of Avoca Island.
         In  comparison  with 1997,  income tax  expense  decreased  $247,005 as
a result of a decrease in taxable income.
         Net income was $.40 per share in 1998 as  compared to $.91 per share in
1997. In line with the Company's decreased income, dividends decreased from $.75
per share in 1997 to $.32 per share in 1998.  Future  dividends  will be largely
dependent on the amount of oil and gas related income received.
         Further  information  regarding the Company's  financial  condition and
results of operations is contained in the President's message on page 4.

14   AVOCA, Incorporated
<PAGE>


STOCK PRICES AND RELATED
SECURITY HOLDER MATTERS

As of January 8 1999,  there  were  approximately  756  holders of record of the
Company's stock, which is traded in the over-the-counter market.
         The following  table shows the range of high and low bid quotations for
the Company's  stock for each  quarterly  period  during the last two years,  as
quoted by the National Quotation Bureau,  Incorporated.  Such quotations reflect
inter-dealer  prices,  without retail mark-up,  mark-down or commissions and may
not necessarily reflect actual transactions. The table also shows the amount and
frequency of cash dividends declared by the Company during the same period.


Period               High      Low    Declared  Record Date   Date Paid   Amount

1998
  First Quarter     $19.75    $18.34
  Second Quarter     20.00     18.50
  Third Quarter      18.63     14.00
  Fourth Quarter     15.00     12.50   12-15-98   1-6-99      1-22-99      $.32

1997
  First Quarter     $15.00    $ 8.25
  Second Quarter     15.75     14.50
  Third Quarter      18.00     15.00
  Fourth Quarter     20.75     18.13   12-18-97   1-6-98      1-22-98      $.75


ACCOUNTANTS

With the approval of the Company's  Board of Directors  and  effective  upon the
filing of the Company's Form 10-KSB for the year ended December 31, 1998,  Ernst
& Young  LLP  has  decided  not to  stand  for  reappointment  as the  Company's
independent public accountants.  There were no disagreements with Ernst & Young,
LLP and its reports have contained no adverse opinion,  disclaimer of opinion or
modification as to uncertainty, audit scope or accounting principles.
         It is  anticipated  that Arthur  Andersen  LLP will be asked to succeed
Ernst & Young LLP as the  Company's  independent  public  accountants  for 1999.
Representatives  of Arthur Andersen LLP and Ernst & Young LLP are expected to be
present at the Annual  Meeting  and to be  available  to respond to  appropriate
questions. Each will have an opportunity to make a statement if he desires to do
so.


AVOCA
INCORPORATED
The Company will furnish without charge a copy of its 1998 Annual Report on Form
10-KSB to be filed with the  Securities and Exchange  Commission,  including the
financial statements and financial statement schedules thereto, to any record or
beneficial  owner of its Common  Stock as of February 5, 1998.  Requests for the
report must be in writing  addressed  to Avoca,  Incorporated,  228 St.  Charles
Avenue, Suite 838, New Orleans,  Louisiana 70130,  Attention: M. Cleland Powell,
III.  If made by a person who was not a  shareholder  of record on  February  5,
1999, the request must include a good faith  representation that such person was
a beneficial  owner of Common Stock on that date.  Copies of any exhibits to the
Form  10-KSB will be  furnished  upon  payment of $.20 per page plus  postage to
cover the cost of furnishing such copies.

                                                        AVOCA, Incorporated   15
<PAGE>


                       [Map of Avoca Island appears here,
                    showing property of Avoca, Incorporated,
                       mineral leases and well locations]


<PAGE>
<TABLE>
<CAPTION>


MINERAL INCOME


------------------------------------------------------------------------------------------------------------------------------------
Year Ended December 31, 1998

                                                                   
                                                                                               Initial    Income Recognized in 1998
                                                             Date of                           Rental     Lease Bonus         Net
Lessee                          Operator                     Lease      Acreage Expiration    Per Acre   or Delay Rental   Royalties
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                          <C>        <C>     <C>              <C>       <C>           <C>     
Texaco, Inc.                    Texaco, Inc.                 5/17/63    41.900  Termination      $ 75      $    --       $    110
                                                                                of production

Alliance Operating Company      Delta Operating Corporation  8/14/87   276.733  Termination      $200           --        135,991
                                                                                of production

Burlington Resources Oil & Gas  Burlington Resources Oil     8/12/96   420.000  Termination      $110       46,200             --
Company                         & Gas Company                                   of production
                                                                                or 8/12/99 if
                                                                                nonproducing

Burlington Resources Oil & Gas  Burlington Resources Oil    12/12/97 1,050.000  Termination      $150      157,500             --
Company                         & Gas Company                                   of production
                                                                                or 12/12/00 if
                                                                                nonproducing

The Meridian Resource           The Meridian Resource       5/27/98    487.490  Termination      $200      97,498              --
& Exploration, Inc.*            & Exploration, Inc.*                            of production
                                                                                or 5/27/01 if
                                                                                nonproducing

The Meridian Resource           The Meridian Resource       5/27/98    627.100  Termination      $200     125,420              --
& Exploration, Inc.*            & Exploration, Inc.*                            of production
                                                                                or 5/27/01 if
                                                                                nonproducing
                                                                                                         --------        --------

                                                                                                         $426,618        $136,101
                                                                                                         ========        ========

*---Formerly Texas Meridian Resources Exploration, Inc.

</TABLE>
                                                          AVOCA, Incorporated 17

<PAGE>
                                                                      EXHIBIT 23

                         Consent of Independent Auditors


We consent to the incorporation by reference in this Annual Report (Form 10-KSB)
of Avoca,  Incorporated  of our report dated  January 13, 1999,  included in the
1998 Annual Report to Shareholders of Avoca, Incorporated.


                                                     /s/ Ernst & Young LLP


New Orleans, Louisiana
March 15, 1999