SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 ending December 31, 1997

Commission File No. 0000-9297

CRONUS CORPORATION
A Nevada corporation      36-3890744
(I.R.S. Employer Identification Number)

7660 E. BROADWAY BLVD., TUCSON, ARIZONA  85710

Registrant's telephone number, including area code:  (520) 
885-1220

Securities registered pursuant to Section 12(b) of the Act:  
NONE		

Securities registered pursuant to Section 12(g) of the Act:
Title of Class:  Common

Check whether the issuer (1) has filed all reports required 
to be filed by Section 13 or 15(d) of the Securities 
Exchange Act of 1934 during the preceding 12 months (or for 
such shorter period that the registrant was required to file 
such reports), and (2) has been subject to such filing 
requirements for the past 90 days.  [X]Yes [ ] No

Check if there is no disclosure of delinquent filers in 
response to Item 405 of Regulation S-B is not 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.  
[x]

The issuer's revenues for its most recent fiscal year is: 
$12,193

As of December 31,1997 the aggregate market value of voting 
stock held by non-affiliates of the registrant was 
$ 5,487,555 based on $0.55 per share.

     Class             Outstanding as of December 31, 1997
$.001 Par Value Common Stock          15,277,316 SHARES

PART I

ITEM 1. Business

History of the Company.

The Company was incorporated in Nevada as TR-3 Industries, 
Inc. in 1979.  Together with its subsidiary, TR-3 Chemical 
Corporation, TR-3 Industries was involved in the manufacture 
and sale of TR-3 Resin Glaze, a cleanser and polisher for 
automobiles.  The products were sold internationally through 
mass marketing distributors.  TR-3 Industries, Inc. filed a 
registration statement on Form 10 with the Securities and 
Exchange Commission for the purpose of registering its 
common stock under Section 12(g) of the Securities 
Exchange Act of 1934, as amended (the "Act").  Such 
registration was filed on June 23, 1980.

In  1982, TR-3 Industries, Inc. and its wholly owned 
subsidiary, TR-3 Chemical Corporation (a California 
corporation), filed a Chapter 11 proceeding in the U.S. 
Bankruptcy Court, Central District of California, Docket 
Number SA82-3767.  The case was converted to a proceeding 
under Chapter 7 of the Bankruptcy Code in January, 1986.  
The proceedings were concluded and the bankruptcy case was 
closed pursuant to an order issued by the U.S. Bankruptcy 
Court on June 11, 1992.  In connection therewith, the assets 
of TR-3 Industries and TR-3 Chemical Corporation were 
liquidated and applied to satisfy liabilities to the extent 
of available assets.  Because liabilities of a corporation 
cannot be discharged pursuant to a Chapter 7 proceeding, the 
unsatisfied liabilities of TR-3 Industries, Inc. and TR-3 
Chemical Corporation remained outstanding after the closing 
of the Chapter 7 bankruptcy case.

The unsatisfied liabilities of TR-3 Industries, Inc. and TR-
3 Chemical Corporation may have been assumed by the Company, 
as successor to TR-3 Industries, Inc.  Current management of 
the Company only has limited information regarding the 
amount and nature of unsatisfied liabilities of TR-3  
Industries Inc. and TR-3 Chemical Corporation.  However, 
management of the Company notes that the liabilities of TR-3 
Industries, Inc. and TR-3 Chemical Corporation, as scheduled 
in their Chapter 11 reorganization petition, amounted to 
approximately $4,500,000 of secured and unsecured debt, held 
by 248 holders, and various unquantified contingent  
iabilities, including ten pending lawsuits, and that, as set 
forth in the final accounting of the Chapter 7 case, the 
assets of TR-3 Industries, Inc. and TR-3 Chemical 
Corporation were applied to satisfy approximately $30,000 of 
such debt.  Management believes that most, if not all, of 
the bankruptcy debts of TR-3 Industries, Inc. and TR-3 
Chemical Corporation are now barred by the applicable 
statutes of limitations.  The corporate charter and 
existence of TR-3 Chemical Corporation was suspended under 
California law on July 2, 1984.

On June 14, 1995, the Company changed its name to 
Diversified American Industries, Inc.  On November 13, 1995 
the Company changed its name to Thunderstone Group Inc.

On November 30, 1995 all of the outstanding stock of the 
Amateur Golf Association of America, Inc. ("AGAA"), a 
company involved in promoting and staging amateur golf 
tournaments, was acquired by the Company through a 
reorganization and stock exchange agreement.  The assets of 
AGAA included franchise rights, trademarks, tournament 
rights, capital assets and membership list.  The 
Shareholders of AGAA were issued 614,000 shares of the 
Company's Common Stock in exchange for 100% of AGAA's 
outstanding stock.  

On December 5, 1995 all of the outstanding stock of the 
Perimeter Bicycling Association of America, Inc. ("PBAA"), a 
company involved in international bicycle event promoting, 
staging and publications, was acquired by the Company 
through a reorganization and stock exchange agreement.  The 
assets of PBAA included the rights to four bicycling events, 
a monthly and annual publication, capital assets and 
membership list.  The principal shareholders of PBAA were 
issued 750,000 shares of the Company's Common Stock in 
exchange for 100% of PBAA's outstanding stock. 

On December 13, 1995 all of the outstanding stock of TGI 
Inc. ("TGII"), a niche marketing company providing goods and 
services in the entertainment industry, was acquired through 
a reorganization and stock exchange agreement.  TGII held 
various video, radio and recording assets.  The shareholders 
of TGII were issued a total of 2,000,000 shares of the 
Company's Common Stock in exchange for 100% of TGII's 
outstanding stock.

On February 27, 1996 the Company sold all of the stock of 
both AGAA and TGII, to Applied Logic Inc., pursuant to an 
Assignment and Release Agreement, in exchange for 3,114,000 
shares of the Company's Common Stock.  Such 3,114,000 shares 
of Common stock consisted of (i) the 614,000 shares  
previously issued to the former shareholders of AGAA, (ii) 
2,000,000 shares previously issued to the former 
shareholders of TGII, and (iii) 500,000 shares previously 
issued in payment of consulting fees in connection with the 
original acquisition of TGII, all of which were transferred 
by the holders thereof to Applied Logic, Inc., and then by 
Applied Logic, Inc. to the Company, pursuant to the 
Assignment and Release Agreement.  Also pursuant to the 
agreement, Applied Logic, Inc. issued shares of its common 
stock to the former shareholders of AGAA and TGII.  In 
addition, AGAA, TGII and their former shareholders agreed to 
release the Company from all liabilities the Company might 
have to any of them in connection with the matters arising 
prior to the date of the Assignment and Release Agreement, 
and the Company agreed to release AGAA, TGII and their 
former shareholders from all liability any of them might 
have to the Company in connection with matters arising prior 
to the date of such agreement.  Pursuant to such agreement, 
the Company received a note for $500,000.00 and 500,000 
shares of Applied Logic, Inc. common stock for those assets.

On March 4, 1996, the Company changed its name to Cronus 
Corporation.

On March 31, 1996 the Company entered into an agreement with 
the Black Diamond Mining Corporation to purchase the Lelan-
Dividend Mine Group assets.  The Company agreed to issue 
2,250,000 shares of its Common Stock for the purchase of the 
Lelan-Dividend Mine Group assets owned by Black Diamond 
Mining Corporation.  Subsequently, while waiting for the 
appraisal and audited financial statements, a new agreement 
was negotiated.  The new agreement consisted of a 
Reorganization and Stock Exchange Agreement between Cronus 
Corporation and Black Diamond Mining Corporation which was 
signed May 23, 1996.  While this agreement was in effect, 
the parties formulated a second reorganization agreement on 
July 8, 1996 in the form of a reverse triangular merger for 
tax purposes.  Pursuant to the merger agreement, the 
shareholders of Black Diamond Mining Corporation's sole 
shareholder were to have acquired shares of the Company's 
Common Stock constituting 80% of the outstanding Common 
Stock of the Company.

On July 19, 1996 PBAA, then a wholly owned subsidiary of 
Cronus Corporation, sold substantially all of its assets, 
other than shares of the Company's Common Stock held by 
PBAA, to EI Tour De Tucson, Inc., a Arizona non-profit 
corporation, as provided for in an Asset Purchase Agreement.  
As consideration for such sale, El Tour de Tucson, Inc. 
assumed PBAA's outstanding obligations.  On August 7, 1996, 
Perimeter Bicycling Association of America, Inc. changed its 
name to Sunorc, Inc.

On December 11, 1996, the Company and Black Diamond Mining 
Corporation agreed to terminate the amended reorganization 
Agreement, due to questions that had arisen regarding the 
appraisals of the Leland-Dividend Mine Group assets.  
Subsequently, share certificates previously delivered to 
Black Diamond Mining Corporation's shareholders pending 
closing of the merger were returned to the Company and 
certain affiliates of Black Diamond Mining Corporation 
transferred their interests in certain mining claims to the 
Company as consideration for certain testing and development 
expenditures made by the Company in connection with the 
Leland-Dividend mine Group assets.  The mining claims 
transferred to the Company consist of the Black 
Diamond Lode Mining Claims and Gila Gold Placer Claims, 
which are more fully described below under the Properties 
section.

On April 3, 1997, the Company entered into a Reorganization 
Agreement with PetroSun Exploration & Production, Inc. 
(hereinafter referred to as "PetroSun"), an Arizona 
corporation incorporated on April 4, 1996.  PetroSun 
controls certain oil and gas leases in Louisiana and 
Northern Arizona.  Pursuant to the Reorganization Agreement, 
the outstanding shares of PetroSun were acquired by the 
Company in return for 600,000 shares of the Company's 
restricted common stock.  The Agreement called for PetroSun 
to be merged with Big Bug Acquisition Company, a wholly 
owned subsidiary of the Company, in the form of a reverse 
triangular merger.  The transaction closed on June 4, 1997.

On April 28, 1997, PetroSun has executed an Employment 
Contract with the President of PetroSun, Gordon M. LeBlanc, 
Jr. for a period of 2 years.  Additionally, Mr. LeBlanc was 
granted an employee Incentive Stock Option.  The grant 
provides the option for Mr. LeBlanc, Jr. to acquire up to 
2,400,000 shares of the Company's stock at a price of $ 
0.50.

Also on April 3, 1997, the Company and Temple Summit 
Financial Projects Inc. ("TSFP") entered into a Joint 
Venture Agreement to conduct testing regarding the viability 
of extracting gold from an area of mining claims held by 
Temple Summit.  Temple Summit holds an existing 80 acre 
block of proven gold reserves in the Moapa District, Nevada.  
The assets of the new Moapa Project are approximately two 
square miles of claims adjacent to TSFP's  proven reserve 
block.  Cronus and Temple Summit will test the area and 
samples from the Moapa Project will be assayed.  If the 
assays reflect economical viable gold, the Joint Venture 
will proceed with the project.

The Company entered the secondary oil recovery business 
through its acquisition of 50% of Tiger Energy Corporation 
on July 24, 1997.  Cronus issued 800,000 shares of its 
restricted common stock to the shareholders of Tiger 
Energy Corporation in return for 50% of the outstanding 
shares of Tiger Energy Corporation.  Tiger Energy is 
licensed as the exclusive domestic service operation for 
Tiger Enhanced Oil Recovery ("EOR") Tool by Tiger Tool Inc.  
Tiger Tool Inc. holds the U.S. patent, service and 
manufacturing rights for the electro-hydraulic crude oil 
recovery technology using a pulsed plasma tool.  Target 
properties consist of shut-in, plugged, or marginal oil 
fields with proven reserves that require secondary recovery 
operations to produce commercial quantities of crude oil.

On October 17, 1997, the Company entered into an agreement 
to acquire all the outstanding shares of Strategic 
Consulting and Administration, Inc. ("SCI").  SCI is the 
designated company to receive ATP 636P, a 640,000 acre oil 
and gas concession located in Queensland, Australia within 
the oil and gas producing region of the Eromanga basin.  
Cronus has issued 500,000 shares of the restricted common 
stock of the Company and will pay $475,000 to shareholders 
of SCI.  Additionally, Cronus will issue up to an additional 
1,500,000 shares of the Company's restricted common stock 
and pay up to an additional $500,000 to the former 
shareholders of SCI upon the reaching of certain goals and 
conditions.

On February 14, 1998, the Company entered into a letter 
agreement to acquire all the outstanding shares of Triple 
"J" Resources Pty., LTD. ("JJJ").  JJJ is the holder of ATP 
594P, a 375,000 acre oil and gas concession located in 
Queensland, Australia within the oil and gas producing 
region of the Eromanga basin.  Cronus has issued 1,500,000 
shares of the restricted common stock of the Company and 
paid $100,000 to shareholders of JJJ.  Additionally, the 
Company will issue up to an additional 1,500,000 shares of 
the Company's restricted common stock to the former 
shareholders of JJJ upon the reaching of certain goals and 
conditions.  JJJ has a farmout agreement with Icon Oil, NL 
by which Icon agreed to drill the first test well on ATP 
594P, and to thereafter provide 50% of the costs of any 
additional wells in return for half of the Company's 
interest in ATP 594P.

Business of Issuer.

Original Business.
The Company originally was engaged in the manufacture and 
sale of TR-3 Resin Glaze, a cleanser and polish for 
automobiles.  In 1988, the Company divested itself of assets 
related to such business in connection with its bankruptcy.  
See "History of Company" above.

Other Prior Business.
The Company did not engage in any further business until 
November 13, 1995, when it recommenced business in the 
sports promotion and entertainment area through the 
acquisition of the stock of the Amateur Golfers Association 
of America, Inc. ("AGAA"), Perimeter bicycling Association 
of America, Inc. ("PBAA") and TGI Inc. ("TGII").  See 
"History of Company" above.  During the fiscal year ended 
December 31, 1995, the Company attempted to develop 
various sports promotion and entertainment businesses 
through these three wholly owned subsidiaries.  However, the 
Company did not derive any revenues from any of these 
subsidiaries.  Both AGAA and TGII were sold on February 27, 
1996.  The assets of PBAA were sold on July 19, 1996.

During the fiscal year ended December 31, 1996, the Company 
exited the sports promotion and entertainment businesses, 
selling the stock of AGAA and TGII, and the assets of PBAA.  
During such year, the Company took steps to become involved 
in the natural resources industry.  In 1996, the Company 
considered acquiring Black Diamond Mining Corporation which 
held title to the Leland-Dividend Mining Group of Claims, 
but elected not to consummate such acquisition.  However, 
the Company did obtain an interest in certain mining claims 
from affiliates of Black Diamond in connection with the 
settlement of such proposed acquisition.

Subsequent Business Developments.

In 1997, the Company has taken steps to become strongly 
involved in the oil and gas industry.  The Company  
affirmatively entered the natural resources market 
in 1997 with the acquisition of PetroSun Exploration & 
Production, Incorporated ("PetroSun").  PetroSun is devoted 
to oil and gas exploration and production.  Also in 1997, 
the Company acquired Strategic Consulting and 
Administration, Inc. ("SCI"), which is the designated 
company to receive an Authority To Prospect ("ATP") 636P, a 
640,000 acre oil and gas concession located in 
Queensland, Australia within the oil and gas producing 
region of the Eromanga basin.  The ATP will not be issued 
until the Australian government resolves issues related to 
the Native Claims Title Act regarding Aborigine rights.  See 
"History of Company" above, and "Oil and Gas Plan of 
Operations" below.

On October 2, 1996, the Company acquired from affiliates of 
Black Diamond Mining Corporation, two groups of mining 
claims located in the State of Arizona.  Title to such 
claims was transferred to the Company through quit claim 
mining deeds as reimbursement for certain testing and 
development expenditures incurred by the Company for the 
benefit of Black Diamond Mining Corporation's Leland-
Dividend Mining Group Claims.  The two groups of mining 
claims acquired by the Company are the Black Diamond group 
of claims, and the Gila Gold Placer claims.  The management 
of the Company has not been able to determine whether the 
Gila Gold Placer claims have mineral deposits that could be 
economically and legally extracted or produced.  Moreover, 
the claims were transferred to the Company by quit claim 
deeds and without further representation or warranty or 
title assurance, and thus, the Company is presently 
uncertain as to the legal status of its rights, title and 
interest, if any, in and to the claims.  See "Title to 
Mining Properties" below.  Additionally, although 
information exists regarding mineral deposits located at the 
claims, such information was not prepared for the Company, 
and the Company has not been authorized to rely on such 
information, and, accordingly, the Company's management is 
unable to determine the reliability or accuracy of such 
information.  The Company desires to asses the nature of 
mineral deposits within these mining claims and the 
feasibility of developing mining operations at such claims.

The Black Diamond group of claims, located in northeastern 
Maricopa County, Arizona were released by the Company after 
the Company's chief geologist determined that commercial 
production of minerals would not be economically viable 
under current and foreseeable conditions.

Gila Gold Placer mining claims consist of unpatented  
association placer claims covering 640 acres in the Safford 
Mining District, Graham County, Arizona.  The Company owns 
the claims by way of mining deeds.  The Company  has been 
searching, unsuccessfully, for a joint venture partner to 
develop the Gila Gold Placer claims.  There can be no 
assurance that any such joint venture will be formed or that 
such exploration and development will be profitable.  The 
Gila Gold Placer mining claim is more fully described below 
in the "Properties" section.

On April 3, 1997, the Company entered into a joint venture 
project with Temple Summit Financial Projects, Inc. ("TSFP") 
whereby TSFP will contribute approximately 1,200 acres of 
mining claims in Moapa County, Nevada (the "TSFP Moapa 
Claims").  The Company engaged with TSFP in a multi-phase 
project to test the TSFP Moapa Claims area.  The Company is 
in the process of reviewing and confirming the results of 
testing the analytical procedure and determination of the 
economic viability of the project.

Future Business Strategy and Operations.

The Company's ongoing business strategy is to create and 
expand its reserve base and cash flow primarily through the 
following:

1.  Raising significant capital to conduct assessments of 
the economical feasibility of extracting natural resources 
from its properties, and to take advantage of leading edge 
technologies such as pulsed plasma secondary recovery and 3-
D seismic exploration projects.

2.  Position itself with strategic sources of capital and 
partners that can react to opportunities in the mining and 
oil and gas business when they present themselves.

3.  Developing alliances with major mineral and oil and gas 
finders that have been trained by the major oil and mineral 
companies.

4.  Participate in projects that have opportunities 
involving relatively small amounts of capital that could 
potentially generate significant rates of return.  These 
projects include areas with large field potentials in 
Northern Arizona, New Mexico, Louisiana and Queensland, 
Australia.

5.  Implementing the Company's investment strategy to 
carefully consider, analyze, and exploit the potential value 
of the Company's existing assets to increase the rate of 
return to its shareholders.

6.  Reinvesting future operating cash flows into development 
of drilling and recompletion activities.

7.  Acquiring properties that build upon and enhance the 
Company's existing asset base.

8.  Developing a long term track record regarding stock 
price performance and a reasonable rate of return to the 
shareholder.

The Company recognizes that the ability to implement its 
business strategies is largely dependent on the ability to 
increase operating cash flows by raising additional debt or 
equity capital to fund future drilling and developmental 
activities.  Management believes that it will be necessary 
to raise additional equity or debt capital to overcome the 
Company's undercapitalization.  However, the Company 
currently has no commitments for any type of funding, and 
there is no assurance that the Company will be able to 
obtain any such financing or that such financing, if 
obtainable, will be on terms necessary to enable the Company 
to operate profitably.

The steps the Company intends to take to assess the 
feasibility of its current projects is described below.  
There can be no assurance that the Company will be able to 
place such oil and gas assets into production or to conclude 
such feasibility assessments, or that if it is able to do 
so, that it will be able to engage in oil and gas and/or 
mining operations profitably.
 
OIL AND GAS PLAN OF OPERATIONS

The Company's primary objective will be to place the oil and 
gas assets of its subsidiary into production.  PetroSun 
controls oil and gas leases on approximately 2,200 acres of 
land in Louisiana referred to as Bayou Pierre Project.  The 
leases contain 17 proven developed oil and gas wells.  These 
wells have been shut-in since the late 1980's due to the 
then low price of oil, so it will be necessary to change the 
pumps on the pumping wells and conduct related maintenance 
work that is normal for this type operation.  Currently, 5 
of the wells have been rehabilitated and placed into 
production. The Company estimates that the cost to complete 
the rehabilitation of the wells to be $60,000.  The leases 
also contain an additional 105 proven undeveloped locations 
which the Company plans to drill if economically feasible.

Drilling Projects

Louisiana:
PetroSun has joint ventured with Vector Horizontal Inc. and 
Tiger Exploration & Production Inc. to drill a horizontal 
Nacatoch gas well (William Prince #20) on the Bayou Pierre 
lease.  The drilling is anticipated  to begin in July 1998.  
The drilling cost have been funded for this project.  Also, 
PetroSun has Joint Ventured with Tedan and Tiger Exploration 
& Production Incorporated to drill a Paluxy / Glen Rose test 
well ( William Prince #21) on the Bayou Pierre Lease. 
The drilling is anticipated  to begin in August 1998.  The 
drilling cost have been funded for this project.

New Mexico:
On October 22, 1997, PetroSun the acquired the Red Dog 
Prospect located in McKinley County, New Mexico, covering 
1,921.18 acres.  The Red Dog Prospect is situated on a 
northeast - southwest trending anticlinal fold on the Chaco 
Slope of the San Juan Basin.  Seismic data indicates a 
feature in the Entrada formation that has been interpreted 
as a reflection from an oil-water contact.  In a 
homogenous sandstone such as the Entrada a 30 foot oil 
column is needed before an oil-water contact can be 
detected.  Analysis of satellite imagery confirmed that 
there is micro-seepage to the surface.  The hydrocarbon 
reflectance covers approximately 1420 acres. The Entrada has 
excellent reservoir quality, with an average porosity of 
23.6% and an average permeability of 315 millidarcies.  On 
40 acre spacing, recoverable reserves are estimated to 
be 456,800 barrels of oil for a well with 30 feet of pay and 
a water drive recovery of 35%.  The secondary objectives of 
the Red Dog Prospect include the Dakota at 3,300 feet and 
the Mancos at 2,900 feet.  PetroSun anticipates drilling the 
initial test well in the Entrada by the end of July, 1998.  
PetroSun has joint ventured with industry partners to raise 
the funds for this prospect.

PetroSun acquired the Cholla Tank Prospect located in 
McKinley County, New Mexico on November 22, 1997.  The 
Cholla Prospect is situated on a northeast - southwest 
trending anticlinal fold on the Chaco Slope of the San Juan 
Basin.  Seismic data indicates a feature in the Entrada 
formation that has been interpreted as a reflection from an 
oil-water contact.  In a homogenous sandstone such as the 
Entrada a 30 foot oil column is needed before an oil-
water contact can be detected.  Analysis of satellite 
imagery confirmed that there is microseepage to the surface.

The Entrada has excellent reservoir quality, with an average 
porosity of 23.6% and an average permeability of 315 
millidarcies.  On 40 acre spacing, recoverable reserves are 
estimated to be 456,800 barrels of oil for a well with 30 
feet of pay and a water drive recovery of 35%.  The 
secondary objectives of the Cholla Prospect include the 
Dakota at 3,300 feet and the Mancos at 2,900 feet.  
PetroSun is currently in the process of surveying and 
permitting the initial test well and anticipates drilling to 
commence by the end of August, 1998 with funding from 
industry partners.  The Cholla Tank Prospect is a direct 
offset to PetroSun's Red Dog Prospect.

Australia:
Triple JJJ Resources Pty., Ltd.
On February 14, 1998, the Company entered into a letter 
agreement to acquire all the outstanding shares of Triple 
"J" Resources Pty., LTD. ("JJJ").  JJJ is the holder of ATP 
594P, a 375,000 acre oil and gas concession located in 
Queensland, Australia within the oil and gas producing 
region of the Eromanga basin.  JJJ has a farmout agreement 
with Icon Oil, NL by which Icon agreed to drill the first 
test well on ATP 594P, and to thereafter provide 50% of the 
costs of any additional wells in return for half of the 
Company's interest in ATP 594P.

On April 16, 1998, Cronus announced the completion of 
drilling on the first well on ATP 594P, the Taylor Franks 
No. 1 well in the Eromanga Basin of east-central Australia.  
The well reached a total depth of 2,643 meters with gas 
shows from 2,520 to 2,643 meters.  Two drill stem tests were 
performed in the Toolachee and Patchawarra formations in the 
Permian section.  The tests indicated gas flow rates of 
approximately 30,000 cubic feet per day with no water.

The results of this first well indicate good structure and 
the presence of gas in this province.  The flow results and 
penetration rate confirmed a tight reservoir and lack of 
sufficient porosity at this location, thus the well was 
plugged.  While  proving that there is gas on this 
concession, the next step is to drill a confirmation well in 
the same zone that has greater porosity and provides 
commercially viable flow rates to capitalize on this find.  
Cronus and Icon Oil NL have determining a second location 
for the next well and anticipates the well to be spudded in 
September 1998 on the concession.  The cost to the Company 
to drill the next well is approximately $300,000.

Strategic Consulting and Administration, Inc.
On October 17, 1997, the Company entered into an agreement 
to acquire all the outstanding shares of Strategic 
Consulting and Administration, Inc. ("SCI").  SCI is the 
designated company to receive ATP 636P, a 640,000 acre oil 
and gas concession located in Queensland, Australia within 
the oil and gas producing region of the Eromanga basin.  SCI 
cannot receive the Authority To Prospect until the issues 
surrounding the Native Title Claims Act have been resolved 
by the parliament of Queensland, Australia.

With the establishment of commercial production on any 
prospect, further development wells will be drilled during 
the balance of 1998.

Although the Company is currently pursuing prospects within 
the project areas described above, and has budgeted to drill 
the number of wells, there can be no assurance that these 
prospects will be drilled at all or within the expected time 
frame.  In particular, budgeted wells that are based upon 
statistical results of drilling activities in other project 
areas are subject to greater uncertainties than wells for 
which drillsites have been identified.  The final  
determination with respect to the drilling of any identified 
drillsites or budgeted wells will be dependent on a number 
of factors, including (i) the results of exploration efforts 
and the acquisition, review and analysis of the seismic 
data, (ii) the availability of sufficient capital resources 
by the Company and the other participants for the drilling 
of the prospects, (iii) the approval of the prospects by 
other participants after additional data has been compiled, 
(iv) the economic and industry conditions at the time of 
drilling, including prevailing and anticipated prices for 
oil and natural gas and the availability of drilling rigs 
and crews, (v) the financial resources and results of the 
Company and (vi) the availability of leases on reasonable 
terms and permitting for the prospect.  There can be no 
assurance that these projects can be successfully developed 
or that the identified drillsites or budgeted wells 
discussed will, if drilled, encounter reservoirs of 
commercially productive oil or natural gas.
 
The success of the Company will be materially dependent upon 
the success of its exploratory drilling program.  
Exploratory drilling involves numerous risks, including the 
risk that no commercially productive oil or natural gas 
reservoirs will be encountered.  The cost of drilling, 
completing and operating wells is often uncertain, and 
drilling operations may be curtailed, delayed or canceled
as a result of a variety of factors, including unexpected 
drilling conditions, pressure or irregularities in 
formations, equipment failures or accidents, adverse weather 
conditions, compliance with governmental requirements and
shortages or delays in the availability of drilling rigs and 
the delivery of equipment.  Although the Company believes 
that its use of available data and other advanced 
technologies should increase the probability of success of 
its exploratory wells and should reduce average finding 
costs, exploratory drilling remains a speculative activity.  
Even when fully utilized and properly interpreted, 
seismic data and other advanced technologies only assist 
geoscientists in identifying subsurface structures and do 
not enable the interpreter to know whether hydrocarbons are 
in fact present in such structures.  In addition, the use 
of seismic data and other advanced technologies requires 
greater predrilling expenditures than traditional drilling 
strategies and the Company could incur losses as a result of 
such expenditures.  The Company's future drilling activities 
may not be successful, and if unsuccessful, such failure 
will have a material adverse effect on the Company's results 
of operations and financial condition.  There can be no 
assurance that the Company's overall drilling success rate 
or its drilling success rate for activity within a 
particular project area will not decline.  

The Company may choose not to acquire option and lease 
rights prior to acquiring seismic data and, in many cases, 
the Company may identify a prospect or drilling location 
before seeking option or lease rights in the prospect 
or location.  Although the Company has identified or 
budgeted for numerous drilling prospects, there can be no 
assurance that such prospects will ever be drilled (or 
drilled within the scheduled or budgeted time frame) or that 
oil or natural gas will be produced from any such prospects 
or any other prospects.  In addition, prospects may 
initially be identified through a number of methods, 
some of which do not include interpretation of seismic data. 
Wells that are currently included in the Company's capital 
budget may be based upon statistical results of drilling 
activities in other project areas that the Company 
believes are geologically similar, rather than on analysis 
of seismic or other data.  Actual drilling and results are 
likely to vary from such statistical results and such 
variance may be material.  Similarly, the Company's drilling 
schedule may vary from its capital budget because of future 
uncertainties, including those described elsewhere.

MINING

The Company intends to asses the feasibility of potential 
future mining projects, involving the Gila Gold Placer 
mining claims.

Gila Association Placer Mine Project. 

Gila Gold Placer Project:
The Company plans to verify and confirm the existence, 
extend and grade of placer gold located at the Gila Gold 
Placer claims.  First, it intends to asses the presence and 
tenor of placer gold as described in engineering reports of 
past exploration efforts.  Next, the Company will analyze 
the economic viability of such deposit by determining 
optimal production rate and stripping-sorting ratios, 
defining a mining and reclamation technique, generating a 
flow sheet, and isolating processing, mining, capital, 
reclamation and general overhead cost factors.

The Company plans to conduct a seismic survey consisting of 
a 5-line, 25' spacing, 9000 lineal foot, segmented survey.  
This survey will be complimented with computer enhanced 
calculations, storage, retrieval and printout capabilities.  
This survey will provide definitions of the alluvial-bedrock 
contact.  From this information, cross-sectional views will 
be generated to define ore reserve volume, assist in mine 
planning and describe mining technique.

The Company also plans to conduct a bulk sampling, intended 
to ascertain the following:  value recoverable per cubic 
yard, concentrating ratio,  concentrating technique, and 
general ground conditions and boulder contact, nature of 
interbeds, slope stability, reject swell and nature of 
backfill material.  The Company estimates the costs of the 
assessment to that point to be $75,000.  The accumulation of 
data from this sampling project will provide the baseline to 
confirm ore reserves and feasibility of the mining project.  
Due to the current prices of gold, this project has been 
placed on hold until such time as gold prices warrant 
continuation of this project.

Moapa Project
The Company entered into a joint venture project with Temple 
Summit Financial Projects, Inc. ("TSFP") whereby TSFP will 
contribute approximately 1,200 acres of mining claims in 
Moapa County, Nevada (the "TSFP Moapa Claims").  The Company 
engaged with TSFP in a multi-phase project to test the TSFP 
Moapa Claims area.  The Company is in the process of 
reviewing and confirming the results of testing the 
analytical procedure and determination of the economic 
viability of the project.

Competition - Oil and Gas
The oil and gas industry is highly competitive in all 
phases.  The Company will encounter strong competition from 
other independent oil and gas companies in acquiring 
economically desirable prospects as well as in marketing 
production therefrom and obtaining external financing.  
Substantially all of the Company's competitors have 
financial resources, personnel resources, and facilities 
substantially greater than those of the Company.

Because there has been a decrease in exploration for and 
development of oil and gas properties in the United States, 
there is increased competition for lower risk development 
opportunities and for available sources of financing.
In addition, the marketing and sale of natural gas and 
processed gas are extremely competitive.  Accordingly, the 
competitive environment in which the Company operates is 
unsettled.

Furthermore, the oil and gas industry is characterized by 
rapid and significant technological advancements and 
introductions of new products and services utilizing new 
technologies.  As others use or develop new technologies, 
the Company may be placed at a competitive disadvantage, and 
competitive pressures may force the Company to implement 
such new technologies at substantial cost.  In addition, 
other oil and gas companies may have greater financial, 
technical and personnel resources that allow them to enjoy 
technological advantages and may in the future allow them to 
implement new technologies before the Company.  There can be 
no assurance that the Company will be able to respond to 
such competitive pressures and implement such technologies 
on a timely basis or at an acceptable cost.  One or more of 
the technologies currently utilized by the Company or 
implemented in the future may become obsolete.  In such 
case, the Company's business, financial condition and 
results of operations could be materially adversely 
affected.  If the Company is unable to utilize the most 
advanced commercially available technology, the Company's 
business, financial condition and results of operations 
could be materially and adversely affected.

Competition - Mining
There is considerable competition for mining prospects on 
federal lands.  Costs of exploration, testing and mining, 
milling, transportation, labor and other costs have risen 
dramatically.  These costs would be a factor in determining 
whether the discovery of minerals, if any, would be 
commercial or not, and could render a discovery 
unprofitable, even if made.

In addition to the uncertainty surrounding the eventual 
development of commercial mineralization on the Company's 
properties, the success of any mining operation which might 
be conducted is dependent upon the price of minerals on the 
domestic and world markets, which is subject to 
fluctuations, in part as a result of actions by central 
banks and government policies.

Employees
As of December 31, 1997, the Company had three employees, 
Jonathan Roberts, Kevin Sherlock and Gordon M. LeBlanc, Jr.  
In order to optimize prospect generation and development, 
the Company utilizes the services of independent consultants 
and contractors to perform a variety of services.   All 
other work, geographical, engineering, metallurgical, legal, 
accounting and otherwise, is performed on a fee basis.  As 
drilling and production activities increase, the Company may 
hire additional personnel as appropriate.  The Company's 
activities in connection with the acquisition, exploration 
and development of mining, oil and gas and other mineral 
properties, the development of new business lines, and the 
negotiation with potential contractual and joint venture 
partners are conducted principally by Jonathan Roberts, 
President of the Company.  See "Item 10, Directors and 
Executive Officers" and "Item 11, Executive Compensation" 
below.

Certain Factors Affecting the Industry and the Company.

Exploration, development and mining of mineral properties, 
including the extraction of oil and gas, involve unique and 
greater risks than those generally associated with other 
industries.  Many exploration programs do not result in the 
discovery of a commercially mineable mineral deposit, in 
which case the costs of exploration are not recoverable.  
The Company's operations are subject to all the hazards and 
risks normally incident to the exploration, development and 
mining of mineral properties, such as the extent of domestic 
production and imports, price fluctuations, the proximity 
and capacity of pipelines and other transportation 
facilities, demand for oil and gas, and other minerals, the 
marketing of competitive fuels and products, and the effects 
of state, federal, and foreign regulation on production and 
sales.  Further factors including the particular risks 
described below:

1.	Long Lead Time, Expense and Delay.
 
The risks normally associated with the exploration and 
development of a mineral deposit, including oil and gas, 
include the extended period  of time, and the costs and 
expenses, required to complete such exploration and 
development, as well as the risks and delays normally 
associated with permitting and construction.  Such events 
can result in a delay in the receipt of income from 
a property or operation with serious adverse consequences to 
the Company's liquidity, financial condition and 
profitability.  In addition, there can be no assurance that 
any such exploration activities will be successful.  
Therefore, exploration costs could result in substantial 
losses to the Company which might not be offset by revenues 
from the properties explored or otherwise.

2.	Need for Additional Financing

The Company needs to undertake significant exploration at 
the properties in which it has an interest and will require 
additional financing beyond its current capital resources, 
such as additional debt or equity financing or a joint 
venture or merger with another mining or oil and gas 
company.  Neither the amount of additional capital needed to 
conduct adequate exploration and development activities, nor 
the Company's ability to raise such capital, can be 
accurately predicted at this time.

Mining and oil and gas companies have historically required 
substantial capital to conduct and expand an exploration and 
development program, and have frequently sought additional 
capital as business has developed.  The Company's current 
capital resources are limited (See "Item 6 -- Management's 
Discussion and Analysis or Plan of Operation; Financial 
Condition, Liquidity and Capital Resources" below) and it 
will need additional financing if it is to conduct any 
significant exploration activities and thereby develop and 
commence its business.  Financing for such purpose could be 
sought through the issuance of additional shares of Common 
Stock or other equity securities, or through debt financing, 
or through various arrangements with third parties.  There 
is no assurance that the Company will be able to obtain any 
such additional financing or that such financing, if 
available, will be on terms necessary to enable the Company 
to operate profitably.  Any such additional financing 
obtained through the issuance of additional shares of Common 
Stock or other equity securities could result in further 
dilution to the Company's shareholders.  Any debt financing 
would increase the Company's operating expenses and could 
reduce or eliminate the Company's net profit.  Any 
arrangement with third parties to finance the Company's 
exploration, development, or operations could take the 
form of a joint venture, merger, lease, royalty, purchase 
option, or some other participation which could reduce, or 
involve a disposition of, the Company's interests in its 
properties or the revenues therefrom.

3.	Effect of Exploration Costs, Risk of Losses. 

Exploration costs incurred by the Company will not generate 
offsetting revenues unless and until the exploration is 
successful and the Company can commence additional 
production, sell the property or otherwise realize the 
benefits of additional discoveries.

4.	Fluctuating Price for Minerals. 

If the Company's exploration and development plans result in 
oil and gas or mineral production, the Company anticipates 
that most of its revenues would be derived from the sale of 
oil and gas and possibly minerals produced from its 
mining and processing operations.  Thus, the Company's 
future prospects  depend upon the ability of the Company to 
locate and profitably exploit mineral deposits through the 
mining, production and sale of minerals.  The feasibility of 
developing and operating new production and mining 
operations and the future profitability of any such 
operations will depend on the price of minerals.  Mineral 
prices, including oil and gas, and in particular gold 
prices, fluctuate widely from time to time and are affected 
by numerous factors beyond the Company's control which 
cannot be accurately predicted, including expectations about 
inflation, exchange rates, banking, economic and political 
crises, interest rates, global supply and demand, political 
and economic conditions, and production costs in major 
mineral producing regions, and many other factors.

The two principal products the Company currently plans to 
produce and market by the Company are crude oil and natural 
gas.  The Company does not currently use commodity futures 
contracts and price swaps in the sales or marketing of
its natural gas and crude oil.

Crude Oil - Crude Oil that could be produced from the 
Company's properties is generally to be transported by truck 
to unaffiliated third-party purchasers at the prevailing 
field price ("the posted price").  The market for the 
Company's crude oil is competitive.  Oil prices are subject 
to volatility due to several factors beyond the Company's 
control including:  political turmoil; domestic and foreign 
production levels; OPEC's ability to adhere to production 
quotas;  and possible governmental control or regulation.

Natural Gas - The Company anticipates that it would sell any 
natural gas production at the wellhead to various pipeline 
purchasers or natural gas marketing companies.  Such 
wellhead contracts typically have various terms and 
conditions, including contract duration.  Under wellhead 
contracts the purchaser is generally responsible for 
gathering, transporting, processing and selling the natural 
gas and natural gas liquids and the seller receives a net 
price at the wellhead.  Accordingly, net prices are affected 
by such costs to be incurred by the purchaser.

5.	Title to Properties.

The Company believes it has satisfactory title to all of its 
producing properties in accordance with standards generally 
accepted in the oil and natural gas industry.  The Company's 
properties are subject to customary royalty interests, liens 
incident to operating agreements, liens for current taxes 
and other burdens which the Company believes do not 
materially interfere with the use of or affect the value of 
such properties.  As is customary in the industry in the 
case of undeveloped properties, little investigation of 
record title is made at the time of acquisition (other than 
a preliminary review of local records).  Investigations, 
including a title opinion of local counsel, are
generally made before commencement of drilling operations.

The successful acquisition of producing properties requires 
an assessment of recoverable reserves, future oil and 
natural gas prices, operating costs, potential environmental 
and other liabilities and other factors.  Such assessments 
are necessarily inexact and their accuracy inherently 
uncertain.  In connection with such an assessment, the 
Company performs a review of the subject properties that it 
believes to be generally consistent with industry practices, 
which generally includes on-site inspections and the review 
of reports filed with various regulatory entities.  Such a 
review, however, will not reveal all existing or potential 
problems nor will it permit a buyer to become sufficiently
familiar with the properties to fully assess their 
deficiencies and capabilities.  Inspections may not always 
be performed on every well, and structural and environmental 
problems are not necessarily observable even when an 
inspection is undertaken.  Even when problems are 
identified, the seller may be unwilling or unable to provide 
effective contractual protection against all or part of such 
problems.  There can be no assurances that any acquisition 
of property interests by the Company will be successful and, 
if unsuccessful, that such failure will not have an adverse 
effect on the Company's future results of operations and 
financial condition.

The legal status of the Company's right, title and interest, 
if any, in and to the Gila Gold Placer claims is currently 
uncertain.  See "Properties" section below.  Therefore, the 
Company may be required to expend additional funds in order 
to, or may ultimately be unable to, establish its rights to 
develop and mine such properties.

6.	Governmental Regulation and Environmental Controls.

The following discussion of regulation of the mining 
industry is necessarily  brief and is not intended to 
constitute a complete discussion of the various statutes, 
rules, regulations or governmental orders to which the 
Company's operations may be subject.

The oil and gas industry and the mining industry are subject 
to extensive federal, state and local laws and regulations 
covering exploration, development, operations and 
production, taxes, labor standards, occupational health, 
waste disposal, environmental protection, reclamation, mine 
and well safety, toxic substances and other matters.  
Environmental, operating, water, dust and other federal and 
state permits are essential to any mining operation.  The 
nature of the mining business is such that mining companies 
are frequently in the process of applying for additional 
permits or modifications to existing permits at any given 
time.  There can be no assurance that such permits will be 
granted in the future as needed, and, if such permits are 
not granted, that the Company or any mining venture in which 
it is a participant could be required to curtail or cease 
its development plans or operations with serious adverse 
consequences to its liquidity and profitability.  Amendments 
to current laws and regulations governing operations and 
activities of mining companies or more stringent 
implementation thereof or additional taxes could have a 
material adverse impact on the Company.  In addition, 
opposition to development of mining operations by 
environmental and other groups is increasing, and such 
opposition may result in delays, increased costs or 
abandonment of development plans.

Any future exploration, rehabilitation, or development 
programs of the Company, as well as any future commercial 
production which might be warranted, will be subject to 
extensive federal, state and local laws and regulations 
controlling not only the exploration for viable minerals in 
the ground, the condition of the shafts and the nature of 
milling and leaching operations, but also the possible 
environmental effects of water and particle contaminant 
discharges resulting from the Company's activities.  No 
environmental impact studies have been performed by the 
Company, and there is no assurance that environmental or 
safety standards more stringent than those presently in 
effect will not be imposed in the future.

Government Regulation - Oil and Gas
General - All aspects of the oil and gas industry are 
extensively regulated by federal, state, and local 
governments in all areas in which the Company intends 
to have operations.

The following discussion of regulation of the oil and gas 
industry is necessarily brief and is not intended to 
constitute a complete discussion of the various statutes, 
rules, regulations or governmental orders to which the 
Company's operations may be subject.

Price Controls on Liquid Hydrocarbons  - There are currently 
no federal price controls on liquid hydrocarbons (including 
oil, natural gas and natural gas liquids).  As a result, any 
oil produced from the Company's properties will be sold at 
unregulated market prices which historically have been 
volatile.

Federal Regulation of Sales and Transportation of Natural 
Gas - Historically, the transportation and sale of natural 
gas in interstate commerce have been regulated pursuant to 
the Natural Gas Act ("NGA"), the Natural Gas Policy Act of 
1978 ("NGPA") and regulations promulgated  thereunder.  The 
Natural Gas Wellhead Decontrol Act of 1989 eliminated all 
regulation of wellhead gas sales effective January 1, 1993.  
As a result, gas sales are not regulated.

The transportation and resale in interstate commerce of 
natural gas continues to be subject to regulation by the 
Federal Energy Regulatory Commission ("FERC") under the NGA.  
The transportation and resale of natural gas transported and 
resold within the state of its production is usually 
regulated by the state involved.  In Louisiana such 
regulation is by the Office of Conservation.  In Arizona, 
such regulation is by the Oil and Gas Commission.  Although 
federal and state regulation of the transportation and 
resale of natural gas currently does not have any material 
direct impact on the Company's planned operations, such 
regulation does have a material impact on the market for  
natural gas production and the price that can be received 
for natural gas production.  Adverse changes in the 
regulations affecting gas markets could have a material 
impact on the Company.

Commencing in the mid-1980's and continuing until the 
present, the FERC promulgated several orders designed to 
correct market distortions and to make gas markets more 
flexible and competitive.  These orders have had a profound 
influence on natural gas markets in the United States and 
have, among other things, increased the importance of 
interstate gas transportation and encouraged development of 
a large spot market for gas.

On April 8, 1992, the FERC issued Order No. 636 requiring 
material restructuring of the sales and transportation 
service provided by interstate pipeline companies.  The 
primary element of Order No. 636 was the mandatory 
unbundling of interstate gas transportation services and 
storage separately from their gas sales.  The unbundled 
transportation and storage was required to be offered 
without favoring gas bought from the pipeline.  Order No. 
636 did not require pipelines to stop buying and reselling 
gas;  to the contrary, it contained specific provisions to 
allow pipelines to continue unbundled sales of natural gas.  
However, after Order No. 636 there was little reason for a 
pipeline to continue selling natural gas and most pipelines 
moved all or almost all of their gas purchases and sales to 
affiliated marketing companies.

Order No. 636 does not regulate gas producers.  However, 
Order No. 636 does appear to have achieved FERC's stated 
goal of  fostering increased competition within all phases 
of the natural gas industry.  Generally speaking, this 
increased competition has driven the price down for natural 
gas.  It is unclear what further impact the increased 
competition will have on the Company's ability to operate 
as a gas producer and seller in the future.  Increased 
flexibility and competition provides greater assurance of 
access to markets, but has consequently reduced or 
restrained prices.

The FERC has announced several important transportation-
related policy statements and proposed rule changes, 
including a statement of policy and a request for comments 
concerning alternatives to its traditional cost-of-service
ratemaking methodology to establish the rates interstate 
pipelines may charge for their services.  A number of 
pipelines have obtained FERC authorization to charge 
negotiated rates as one such alternative.  In February 1997, 
the FERC announced a broad inquiry into issues facing the 
natural gas industry to assist the FERC in establishing 
regulatory goals and priorities in the post-Order No.
636 environment. Similarly, state agencies such as the Texas 
Railroad Commission, have been reviewing changes to its 
regulations governing transportation and gathering services 
provided by intrastate pipelines and gatherers and recently 
implemented a code of conduct intended to prevent undue 
discrimination by intrastate pipelines and gatherers in 
favor of their marketing affiliates.  Although the changes 
being considered by these federal and state regulators would 
affect the Company only indirectly, they are intended 
to further enhance competition in natural gas markets.

In addition to FERC regulation of interstate pipelines under 
the NGA, various state commissions also regulate the rates 
and services of pipelines whose operations are purely 
intrastate in nature.  To the extent intrastate pipelines 
elect to transport gas in interstate commerce under certain 
provisions of the NGPA, those transactions are subject to 
limited FERC regulation under the NGPA and may ultimately 
effect prices of natural gas.

There are many legislative proposals pending in Congress and 
in the  legislatures of various states that, if enacted, 
might significantly affect the oil and gas industry.  The 
Company is not able to predict what will be enacted and thus 
what effect, if any, such proposals would ultimately have on 
the Company.

State and Local Regulation of Drilling and Production  - 
State regulatory authorities have established rules and 
regulations requiring permits for drilling, bonds for 
drilling, reclamation and plugging operations, limitations 
on spacing and pooling of wells, and reports concerning 
operations, among other matters.  The states in which the 
Company plans to operate also have statutes  and 
regulations  governing a number of environmental and 
conservation matters, including the unitization and pooling 
of oil and gas properties and establishment of maximum rates 
of production from oil and gas wells.  A few states also 
prorate production to the market demand for oil and gas.  
These statutes and regulations  limit the rate at which oil 
and gas could otherwise be produced and the prices that can 
be obtained for such products.

Environmental  Regulations  -  The production, handling, 
transportation and disposal of oil and gas and by-products 
are subject to regulation under federal, state and local 
environmental laws.  In most instances, the applicable 
regulatory requirements relate to water and air pollution 
control and solid waste management measures or to 
restrictions of operations in environmentally sensitive 
areas.  However, it is reasonably likely that the trend in 
environmental legislation and regulations will continue 
towards stricter standards and may result in significant 
future costs to the Company.  For instance, efforts have 
been made in Congress to amend the Resource Conservation and 
Recovery Act to reclassify oil and gas production wastes as 
"Hazardous  Waste," the effect of which would be to further 
regulate the handling, transportation and disposal of 
such waste.  If such legislation were to pass, it could have 
a significant adverse impact on the anticipated operating 
costs of the Company, as well as the oil and gas industry in 
general.

The Company may generate wastes that may be subject to the 
federal Resource Conservation and Recovery Act ("RCRA") and 
comparable state statutes.  The U.S. Environmental 
Protection Agency ("EPA") and various state agencies have 
limited the approved methods of disposal for certain 
hazardous and nonhazardous wastes.  Furthermore, certain 
wastes generated by the Company's oil and natural gas 
operations that are currently exempt from treatment as 
"hazardous wastes" may in the future be designated as 
"hazardous wastes," and therefore be subject to more 
rigorous and costly operating and disposal requirements.
 
The Company currently owns or leases numerous properties 
that for many years have been used for the exploration and 
production of oil and gas.  Although the Company believes 
that it has used good operating and waste disposal 
practices, prior owners and operators of these properties 
may not have used similar practices, and hydrocarbons or 
other wastes may have been disposed of or released on or 
under the properties owned or leased by the Company or on or 
under locations where such wastes have been taken for 
disposal.  In addition, many of these properties have been 
operated by third parties whose treatment and disposal or 
release of hydrocarbons or other wastes was not under the 
Company's control.  These properties and the wastes 
disposed thereon may be subject to the Comprehensive 
Environmental Response, Compensation and Liability Act 
("CERCLA"), RCRA and analogous state laws as well as state 
laws governing the management of oil and gas wastes.  Under 
such laws, the Company could be required to remove or
remediate previously disposed wastes (including wastes 
disposed of or released by prior owners or operators) or 
property contamination (including groundwater contamination) 
or to perform remedial plugging operations to prevent future
contamination.
 
The Company's operations may also be subject to the Clean 
Air Act ("CAA") and comparable state and local requirements.  
Amendments to the CAA were adopted in 1990 and contain 
provisions that may result in the gradual imposition 
of certain pollution control requirements with respect to 
air emissions from the operations of the Company.  The EPA 
and states have been developing regulations to implement 
these requirements.  The Company may be required to 
incur certain capital expenditures in the next several years 
for air pollution control equipment in connection with 
maintaining or obtaining operating permits and approvals 
addressing other air emission-related issues.  However, the 
Company does not believe its operations will be materially 
adversely affected by any such requirements.
 
 Federal regulations require certain owners or operators of 
facilities thatstore or otherwise handle oil, to prepare and 
implement spill prevention, control, countermeasure ("SPCC") 
and response plans relating to the possible discharge of oil 
into surface waters.  The Oil Pollution Act of 1990, ("OPA") 
contains numerous requirements relating to the prevention of 
and response to oil spills into waters of the United States.  
The OPA subjects owners of facilities to strict joint and 
several liability for all containment and cleanup costs and 
certain other damages arising from a spill, including, but 
not limited to, the costs of responding to a release of oil 
to surface waters.  The OPA also requires owners and 
operators of offshore facilities that could be the source of 
an oil spill into federal or state waters, including 
wetlands, to post a bond, letter of credit or other form of 
financial assurance in amounts ranging from $10 million in 
specified state waters to $35 million in federal outer 
continental shelf waters to cover costs that could be 
incurred by governmental authorities in responding to an oil 
spill.  Such financial assurances may be increased by as 
much as $150 million if a formal risk assessment indicates 
that the increase is warranted.  Noncompliance with OPA may 
result in varying civil and criminal penalties and 
liabilities.

Operations of the Company are also subject to the federal 
Clean Water Act ("CWA") and analogous state laws.  In 
accordance with the CWA, the state of Louisiana has issued 
regulations prohibiting discharges of produced water in
state coastal waters effective July 1, 1997.  While the 
Company has no plans to drill in Louisiana coastal waters, 
if it did, the Company will be obligated to comply with 
these regulations.  Pursuant to other requirements of the 
CWA, the EPA has adopted regulations concerning discharges 
of storm water runoff.  This program requires covered 
facilities to obtain individual permits, participate in a 
group permit or seek coverage under an EPA general permit.  
Like OPA, the CWA and analogous state laws relating to the 
control of water pollution provide varying civil and 
criminal penalties and liabilities for releases of petroleum 
or its derivatives into surface waters or into the ground.
 
CERCLA, also known as the "Superfund" law, and similar state 
laws impose liability, without regard to fault or the 
legality of the original conduct, on certain classes of 
persons that are considered to have contributed to the
release of a "hazardous substance" into the environment.  
These persons include the owner or operator of the disposal 
site or sites where the release occurred and companies that 
disposed or arranged for the disposal of the hazardous 
substances found at the site.  Persons who are or were 
responsible for releases of hazardous substances under 
CERCLA may be subject to joint and several liability for the 
costs of cleaning up the hazardous substances that have been 
released into the environment, for damages to natural 
resources and for the costs of certain health studies, and 
it is not uncommon for neighboring landowners and other 
third parties to file claims for personal injury and
property damage allegedly caused by the hazardous substances 
released into the environment.
 
New initiatives regulating the disposal of oil and gas waste 
are also pending in certain states, including states in 
which the Company plans to conduct operations, and these 
various initiatives could have an adverse impact on the 
Company. Management believes that compliance with current 
applicable laws and regulations or with proposals in their 
present form could possibly have a material adverse impact 
on the Company, but management is unable to predict the 
final form of the pending regulations or their potential 
impact on the Company.

Although the Company does not believe its planned business 
operations will impair environmental quality, compliance 
with federal, state and local regulations which have been 
enacted or adopted regulating the discharge of materials 
into the environment could have an adverse effect upon the 
capital expenditures, earnings and competitive position of 
the Company, the extent of which the Company now is unable 
to assess.

ITEM 2. Properties

PRINCIPAL OIL AND GAS INTERESTS

Productive Wells and Acreage - The Company's  producing 
properties as of  December 31, 1997 are located in the 
following areas shown in the table below:

                   OIL      GAS          Developed 
Field,  State     Wells    Wells          Acreage
Lake End Field, LA          17              340

The Company's producing oil and gas properties are located 
on leases held by the Company for as long as production is 
maintained.

Undeveloped Acreage - The Company's gross interests in 
leased undeveloped acreage in Louisiana and Northern Arizona 
as of December 31, 1997 is 1,660 and 18,212.23 acres, 
respectively.  All the properties located in Louisiana 
and Northern Arizona will expire at various times in 2001 
unless production has been obtained.  

LOUISIANA PROPERTIES

Lake End Field, Red River Parish, Louisiana - In July 1997, 
the Company purchased a majority working interest in 
approximately 1,860 acres in the Lake End Field.  The Lake 
End Field is located about 47 miles south of  Shreveport, 
Louisiana near the community of Lake End, Louisiana.  The 
producing area is bounded on the East and North by Red River 
and on the West and South by Bayou Pierre (which is an 
ancient river bed of Red River).  Within this producing area 
is located the Lake End Field, Jordon Ferry Field and the 
Red Oak Field.  

There are currently 17 wells shut-in with 93 proven 
drillable locations.  The Company is presently working to 
recomplete several wells in behind-pipe zones to take 
advantage of current gas prices in the market.  The Company 
expects that after finishing the recompletion program, daily 
gas production can be significantly increased.  A geological 
and engineering study is currently being conducted to seek 
further development opportunities in the existing wells 
as well as to delineate optimal drilling locations.

Red Oak Lake Field, Red River Parish, Louisiana - In July 
1997, the Company purchased a majority working interest in  
approximately 640 acres in the Red Oak Field.  There are 3 
proven drillable gas well locations in the Rodessa 
formation in the Red Oak Field.

NORTHERN ARIZONA PROSPECTS

Overview - In late 1997 and through out 1998, the Company 
will be directing a significant portion of its resources to 
the Holbrook Basin region.  The Company is focusing in the 
Holbrook Basin as the result of a seven year evaluation to 
determine the possibility of hydrocarbon accumulations in 
the Supai, Penn and Devonian formations.

Currently, two prospects are in the process of drilling or 
are expected to commence drilling in the fourth quarter of 
1998.  These include El Tule, and Manuel Seep.  A brief  
description of these prospects follows.

The El Tule Prospect is located on the southwest flank of 
the Cedar Mesa Anticline, a large surface anticline along 
the southeast edge of the Holbrook Basin in Apache County, 
Arizona.  The Cedar Mesa Anticline is located in the 
part of the upper Supai evaporite basin where there are 
carbonates and sulfates.

The Manuel Seep Prospect is located on a broad surface 
anticline (the highest structure in the basin) along the 
southern edge of the Holbrook Basin in Apache County, 
Arizona.  It trends northwest for a distance of 3 1/2 miles, 
and it covers an area of at least 23 sections.  Some of 
those sections are irregular, so the total prospect contains 
13,766.19 acres, which is large enough to hold potential oil 
reserves of one hundred million barrels, or more.

The Oso Draw Prospect is located on the north end of Concho 
Dome in the Holbrook Basin in Apache County, Arizona.  The 
Holbrook Basin is a relatively shallow Permian salt basin, 
so only a 3,800 foot well will be needed to test the 
prospect formations.  These productive Paleozoic formations 
are continuously present from the Paradox Basin in northern 
Apache County through the Black Mesa Basin to the Holbrook 
Basin and on to the Permian Basin.  As a result, this 
prospect has the potential to produce from at least three 
formations with excellent reservoir quality, a history of 
production and shows of oil and gas close to the prospect.

The Little Colorado Prospect is located on a large untested 
surface anticline in the Southeast of the Holbrook Basin in 
Apache County, Arizona.  The structure covers nineteen (19) 
sections (12,162.3 acres) in Townships 14 and 15 North, 
Range 24 East, and the Little Colorado River runs through 
the middle of the prospect.

NEW MEXICO PROPERTIES

Currently, two prospects are in the process of drilling or 
are expected to  commence drilling in New Mexico during the 
third quarter of 1998.  These include the Red Dog and Cholla 
Tank.  A brief description of these  prospects follows.

Red Dog Prospect is located in McKinley County, New Mexico, 
covering 1,921.18 acres.  The Red Dog Prospect is situated 
on a northeast - southwest trending anticlinal fold on the 
Chaco Slope of the San Juan Basin.  Seismic data indicates a 
feature in the Entrada formation that has been interpreted 
as a reflection from an oil-water contact.  In a homogenous 
sandstone such as the Entrada a 30 foot oil column is needed 
before an oil-water contact can be detected.  Analysis of 
satellite imagery confirmed that there is micro-seepage to 
the surface.  The hydrocarbon reflectance covers 
approximately 1420 acres. The Entrada has excellent 
reservoir quality, with an average porosity of 23.6% and 
an average permeability of 315 millidarcies.  On 40 acre 
spacing, recoverable reserves are estimated to be 456,800 
barrels of oil for a well with 30 feet of pay and a water 
drive recovery of 35%.  The secondary objectives of the Red 
Dog Prospect include the Dakota at 3,300 feet and the Mancos 
at 2,900 feet.  PetroSun anticipates drilling the initial 
test well in the Entrada by the end of July, 1998.  PetroSun 
has joint ventured with industry partners to raise the funds 
for this prospect.

The Cholla Tank Prospect is located in McKinley County, New 
Mexico.  The Cholla Prospect is situated on a northeast - 
southwest trending anticlinal fold on the Chaco Slope of the 
San Juan Basin.  Seismic data indicates a feature in the 
Entrada formation that has been interpreted as a reflection 
from an oil-water contact.  In a homogenous sandstone such 
as the Entrada a 30 foot oil column is needed before an oil-
water contact can be detected.  Analysis of satellite 
imagery confirmed that there is microseepage to the surface.

The Entrada has excellent reservoir quality, with an average 
porosity of 23.6% and an average permeability of 315 
millidarcies.  On 40 acre spacing, recoverable reserves are 
estimated to be 456,800 barrels of oil for a well with 30 
feet of pay and a water drive recovery of 35%.  The 
secondary objectives of the Cholla Prospect include the 
Dakota at 3,300 feet and the Mancos at 2,900 feet.  
PetroSun is currently in the process of surveying and 
permitting the initial test well and anticipates drilling to 
commence by the end of August, 1998 with funding from 
industry partners.  The Cholla Tank Prospect is a direct 
offset to PetroSun's Red Dog Prospect.

AUSTRALIA

On February 14, 1998, the Company entered into a letter 
agreement to acquire all the outstanding shares of Triple 
"J" Resources Pty., LTD. ("JJJ").  JJJ is the holder of ATP 
594P, a 375,000 acre oil and gas concession located in 
Queensland, Australia within the oil and gas producing 
region of the Eromanga basin.  JJJ has a farmout agreement 
with Icon Oil, NL by which Icon agreed to drill the first 
test well on ATP 594P, and to thereafter provide 50% of the 
costs of any additional wells in return for half of the 
Company's interest in ATP 594P.

On April 16, 1998, Cronus announced the completion of 
drilling on the first well on ATP 594P, the Taylor Franks 
No. 1 well in the Eromanga Basin of east-central Australia.  
The well reached a total depth of 2,643 meters with gas 
shows from 2,520 to 2,643 meters.  Two drill stem tests were 
performed in the Toolachee and Patchawarra formations in the 
Permian section.  The tests indicated gas flow rates of 
approximately 30,000 cubic feet per day with no water.

The results of this first well indicate good structure and 
the presence of gas in this province.  The flow results and 
penetration rate confirmed a tight reservoir and lack of 
sufficient porosity at this location, thus the well was 
plugged.  While  proving that there is gas on this 
concession, the next step is to drill a confirmation well in 
the same zone that has greater porosity and provides 
commercially viable flow rates to capitalize on this find.  
Cronus and Icon Oil NL have determining a second location 
for the next well and anticipates the well to be spudded in 
September 1998 on the concession.  The cost to the Company 
to drill the next well is approximately $300,000.

PROVED DEVELOPED AND UNDEVELOPED RESERVES

The oil and gas reserve and reserve value information is 
based upon an  engineering evaluation by Kenneth W. Frazier.  
The estimated proved reserves represent forward-looking 
statements and should be read in connection with the 
disclosure on forward-looking statements included herein 
under Item 6 in Management's Discussion and Analysis.

The Company has not filed any reports containing oil and gas 
reserve estimates with any federal authority or agency other 
than the Securities and Exchange Commission.  

All of the Company's current oil and gas reserves are 
located in the Continental United States.  The table below 
sets forth the Company's estimated quantities of proved 
reserves, and the present value of estimated future net 
revenues.  The standardized measure of discounted future net 
cash flows is computed by applying year-end prices of oil 
($15.46 per barrel) and gas ($2.40 per MCF) to the estimated 
future production of proved and developed oil and gas 
reserves, less estimated future expenditures (based on year-
end costs) to be incurred in developing and producing the 
proved reserves, less estimated future income tax expenses 
(based on year-end statutory rates, with consideration of 
future tax rates already legislated) to be incurred on 
pretax net cash flows less tax basis of the properties and 
available credits, and assuming continuation of existing 
economic conditions.  The estimated future net cash flows 
are then discounted using a rate of 10% per year to reflect 
the estimated timing of the future cash flows.

                          Oil (Bbls)      Gas (Mcf)
Proved Developed and Undeveloped Reserves
    Beginning                  -0-             -0-
    Purchase              1,126,510      25,133,272
    Production                 (211)         (6,236)

     End of Year          1,126,229      25,127,036

Proved Developed Reserves

    Beginning of Year          -0-              -0-
     End of Year            173,886       2,868,764

Standardized measure of discounted future net cash flows at 
December 31, 1997.
     Future Cash Inflows        $9,397,254
     Future Production Rates      (469,803)
     Future Income Tax Expense  (2,142,574)
                                 6,784,817

10% annual discount for estimated timing of cash flows
                                (4,278,175)

Standardized measures of discounted future net cash flows 
relating to proved oil and gas reserves.
                               $ 2,506,642


In accordance with Commission regulations, the reserve 
reports used oil and natural gas prices in effect at 
December 31, 1997.  The prices used in calculating the 
estimated future net revenue attributable to proved reserves 
do not necessarily reflect market prices for oil and natural 
gas production subsequent to December 31, 1997.  There can 
be no assurance that all of the proved reserves will be 
produced and sold within the periods indicated, that the 
assumed prices will actually be realized for such production 
or that existing contracts will be honored or judicially 
enforced.
 
There are numerous uncertainties inherent in estimating oil 
and natural gas reserves and their estimated values, 
including many factors beyond the control of the producer.  
The reserve data set forth in this Annual Report on Form 10-
KSB represent only estimates.  Reservoir engineering is a 
subjective process of estimating underground accumulations 
of oil and natural gas that cannot be measured in an exact 
manner.  Estimates of economically recoverable oil and
natural gas reserves and of future net cash flows  
necessarily depend upon a number of variable factors and 
assumptions, such as historical production from the area 
compared with production from other producing areas, the 
assumed effects of regulations by governmental agencies and 
assumptions concerning future oil and natural gas prices, 
future operating costs, severance and excise taxes, 
development costs and workover and remedial costs, all of 
which may in fact vary considerably from actual results.  
For these reasons, estimates of the economically recoverable 
quantities of oil and natural gas attributable to any
particular group of properties, classifications of such 
reserves based on risk f recovery, and estimates of the 
future net cash flows expected therefrom prepared by 
different engineers or by the same engineers but at 
different times may vary substantially and such reserve 
estimates may be subject to downward or upward adjustment 
based upon such factors.  Actual production, revenues 
and expenditures with respect to the Company's reserves will 
likely vary from estimates, and such variances may be 
material.  In addition, the 10% discount factor, which is 
required by the Commission to be used in calculating 
discounted future net cash flows for reporting purposes, is 
not necessarily the most appropriate discount factor based 
on interest rates in effect from time to time and risks 
associated with the Company or the oil and natural gas 
industry in general.
 
In general, the volume of production from oil and natural 
gas properties declines as reserves are depleted, with the 
rate of decline depending on reservoir characteristics.  
Except to the extent the Company conducts successful
exploration and development activities or acquires 
properties containing proved reserves, or both, the proved 
reserves of the Company will decline as reserves are 
produced.  The Company's future oil and natural gas 
production is, therefore, highly dependent upon its level of 
success in finding or acquiring additional reserves.  The 
business of exploring for, developing or acquiring reserves 
is capital intensive.  To the extent cash flow from 
operations is reduced and external sources of capital become 
limited or unavailable, the Company's ability to make the 
necessary capital investment to maintain or expand its asset 
base of oil and natural gas reserves would be impaired.  The 
failure of an operator of the Company's wells to adequately 
perform operations, or such operator's breach of the 
applicable agreements, could adversely impact the Company.  
In addition, there can be no assurance that the Company's 
future exploration, development and acquisition activities 
will result in additional proved reserves or that the 
Company will be able to drill productive wells at acceptable 
costs.  Furthermore, although the Company's revenues could 
increase if prevailing prices for oil and natural gas 
increase significantly, the Company's finding and 
development costs could also increase.

MINING CLAIMS:
GILA GOLD PLACER MINING CLAIMS:

Gila Placer Mining Claims consist of unpatented association 
mining claims covering 640 acres.  Cronus Corporation 
acquired the claims by way of mining deed on October 2, 
1996.  The claims lie along the prehistoric bed of which 
once was part of the Gila river.  The terrace gravel's are 
of auriferous origin, deposited by erosive agents, and are 
of a later flow than the Gila conglomerate.  This 
conglomerate forms the bed-rock or strates of gold 
concentration.  These gravel's no doubt are a remnant of an 
ancient river channel.  The channel may be traced by its 
exposed edges and rims in several places.  The gold is of 
ancient origin and is derived from the disintegration of the 
immeasurable gold-bearing quartz veins in the igneous rocks 
which are of the post-Paleozoic age.  There has been no 
previous mining on these claims.  The property is without 
reserves, and any activities to be undertaken would be 
exploratory in nature.

Location
The Gila Mining Group of Claims are located in the Safford 
Mining District, Graham County, State of Arizona.  The 
association placer claims are approximately 25 miles 
northeast of Safford, Arizona.

Access
The claims are reached via a graded county road that extends 
from Highway 666.  The forest road passes adjacent to the 
northern end of the claims.

Relief and Topography
The elevation of the area is approximately 4600 feet above 
sea level.  Relief in the claim area ranges from 50 feet to 
over 1000 feet.  The claims are located in an area of rugged 
topography characterized by canyons and steep tributary 
valleys.

Weather and Climate
Weather is typically semi-arid.  At no time of the year will 
climate cause a serious problem.  Rainfall occurs chiefly in 
summer as thunderstorms.  These can cause damage to roads 
and structures if they are not properly engineered.

Water and Power
There is no electrical power or water in the claim area.  It 
will have to be generated at the mine site and wells 
drilled.

Mills, Smelter and Similar Facilities
No mills, smelter or related facilities are available in the 
claim area.  Concentrates or any ore would be trucked off-
site to a processing plant.

TITLE TO MINING PROPERTIES

The Company's only significant mining assets as of December 
31, 1997, consists of its possessory interest in the Gila 
Gold Placer mining claims, which consist of unpatented 
mining claims.  The validity of all unpatented mining 
claims is dependent upon various inherent uncertainties and 
conditions that may prevent a fee title in the usual sense 
from existing or vesting.

Unpatented mining claims, when properly located, staked and 
posted according to regulation, give the claimant a 
possessory right only.  Possessory title to an 
unpatented claim, when validly initiated, endures unless 
lost through  abandonment or through a forfeiture which 
results from an adverse location made while the claim is in 
default with respect to the performance of annual 
assessment work.  Because many of these factors involve 
findings of fact, title validity cannot be determined solely 
from an examination of the record.

The continued validity of the Gila unpatended mining claims 
is subject to many contingencies, including the availability 
of land for the claim at the time location is made, the 
making of valid mineral discoveries within the boundary of 
each claim, the compliance with all regulations, both state 
and federal, for locating claims, and the performance of 
annual assessment work which is currently in the 
amount of $100.00 per claim.  Failing satisfaction of the 
requirements, the claims are subject to cancellation by the 
United States upon finding of no valid discovery or failure 
to perform annual assessment work.  Failure to perform 
annual assessment work subjects the claimant to the risk of  
forfeiture of rights through valid subsequent locations by 
others or through cancellation by the government agency 
involved.

In addition, the Company acquired its possessory interests 
in the  Gila Gold Placer claims through quit-claim deeds.  
Pursuant to a quit-claim deed, the transfer of an interest 
in property transfers whatever right, title and interest it 
may have in and to the property without representation or 
warranty as the extent of such right, title and interest or 
as to the absence of adverse claims.  Thus, the Company's 
claims are dependent upon the validity, extent and quality 
of the transferor's right, title and interest in and to such 
claims.  The Company does not have any information regarding 
the nature of its transferor's right, title and interest in 
and to the Gila Gold Placer claims, nor has the Company 
received any warranties of title, title opinions or policies 
of title insurance.  As a result, the legal status of the 
Company's right, title and interest, if any, in and to these 
claims is currently uncertain.

TITLE TO OIL AND GAS

The Company believes it has satisfactory title to all of its 
producing properties in accordance with standards generally 
accepted in the oil and natural gas industry.  The Company's 
properties are subject to customary royalty interests, liens 
incident to operating agreements, liens for current taxes 
and other burdens which the Company believes do not 
materially interfere with the use of or affect the value of 
such properties.  As is customary in the industry in the 
case of undeveloped properties, little investigation of 
record title is made at the time of acquisition (other than 
a preliminary review of local records).  Investigations, 
including a title opinion of local counsel, are generally 
made before commencement of drilling operations.

The successful acquisition of producing properties requires 
an assessment of recoverable reserves, future oil and 
natural gas prices, operating costs, potential environmental 
and other liabilities and other factors.  Such assessments 
are necessarily inexact and their accuracy inherently 
uncertain.  In connection with such an assessment, the 
Company performs a review of the subject properties that it 
believes to be generally consistent with industry practices, 
which generally includes on-site inspections and the review 
of reports filed with various regulatory entities.  Such a 
review, however, will not reveal all existing or potential 
problems nor will it permit a buyer to become sufficiently
familiar with the properties to fully assess their 
deficiencies and capabilities.  Inspections may not always 
be performed on every well, and structural and environmental 
problems are not necessarily observable even when an 
inspection is undertaken.  Even when problems are 
identified, the seller may be unwilling or unable to provide 
effective contractual protection against all or part of such 
problems.  There can be no assurances that any acquisition 
of property interests by the Company will be successful and, 
if unsuccessful, that such failure will not have an adverse 
effect on the Company's future results of operations and 
financial condition.

GLOSSARY OF CERTAIN INDUSTRY TERMS
 
The definitions set forth below shall apply to the indicated 
terms as used herein.  All volumes of natural gas referred 
to herein are stated at the legal pressure base of the state 
or area where the reserves exist and at 60 degrees 
Fahrenheit and in most instances are rounded to the nearest 
major multiple.
 
After payout.  With respect to an oil or gas interest in a 
property, refers to the time period after which the costs to 
drill and equip a well have been recovered.
 
Bbl.  One stock tank barrel, or 42 U.S. gallons liquid 
volume, used herein in reference to crude oil or other 
liquid hydrocarbons.
 
Bbls/d.  Stock tank barrels per day.
 
Bcf.  Billion cubic feet.
 
Bcfe.  Billion cubic feet equivalent, determined using the 
ratio of six Mcf of natural gas to one Bbl of crude oil, 
condensate or natural gas liquids.
 
Before payout.  With respect to an oil or gas interest in a 
property, refers to the time period before which the costs 
to drill and equip a well have been recovered.
 
Btu or British Thermal Unit.  The quantity of heat required 
to raise the temperature of one pound of water by one degree 
Fahrenheit.
 
Completion.  The installation of permanent equipment for the 
production of oil or gas or, in the case of a dry hole, the 
reporting of abandonment to the appropriate agency.
 
Developed acreage.  The number of acres which are allocated 
or assignable to producing wells or wells capable of 
production.
 
Development well.  A well drilled within the proved area of 
an oil or gas reservoir to the depth of a stratigraphic 
horizon known to be productive.
 
Dry hole or well.  A well found to be incapable of producing 
hydrocarbons in sufficient quantities such that proceeds 
from the sale of such production exceed production expenses 
and taxes.
 
Exploratory well.  A well drilled to find and produce oil or 
gas reserves not classified as proved, to find a new 
reservoir in a field previously found to be productive of 
oil or gas in another reservoir or to extend a known 
reservoir.
 
Farm-in or farm-out.  An agreement whereunder the owner of a 
working interest in an oil and natural gas lease assigns the 
working interest or a portion thereof to another party who 
desires to drill on the leased acreage.  Generally, the 
assignee is required to drill one or more wells in order to 
earn its interest in the acreage.  The assignor usually 
retains a royalty or reversionary interest in the lease.  
The interest received by an assignee is a "farm-in" while 
the interest transferred by the assignor is a "farm-out."
 
Field.  An area consisting of a single reservoir or multiple 
reservoirs all grouped on or related to the same individual 
geological structural feature and/or stratigraphic 
condition.
 
Finding costs.  Costs associated with acquiring and 
developing proved oil and natural gas reserves which are 
capitalized by the Company pursuant to generally accepted 
accounting principles, including all costs involved in
acquiring acreage, geological and geophysical work and the 
cost of drilling and completing wells.

Gross acres or gross wells.  The total acres or wells, as 
the case may be, in which a working interest is owned.

MBbls.  One thousand barrels of crude oil or other liquid 
hydrocarbons.

MBbls/d.  One thousand barrels of crude oil or other liquid 
hydrocarbons per day.

Mcf.  One thousand cubic feet.

Mcf/d.  One thousand cubic feet per day.

Mcfe.  One thousand cubic feet equivalent, determined using 
the ratio of six Mcf of natural gas to one Bbl of crude oil, 
condensate or natural gas liquids.

MMBbls.  One million barrels of crude oil or other liquid 
hydrocarbons.

MMBtu.  One million British Thermal Units.

Mmcf.  One million Cubic feet.

MMcf/d.  One million cubic feet per day.

MMcfe.  One million cubic feet equivalent, determined using 
the ratio of six Mcf of natural gas to one Bbl of crude oil, 
condensate or natural gas liquids, which approximates the 
relative energy content of crude oil, condensate and natural 
gas liquids as compared to natural gas.  Prices have 
historically been higher or substantially higher for crude 
oil than natural gas on an energy equivalent basis.
 
Net acres or net wells.  The sum of the fractional working 
interests owned in gross acres or gross wells.
 
Normally pressured reservoirs.  Reservoirs with a formation-
fluid pressure equivalent to 0.465 psi per foot of depth 
from the surface.  For example, if the formation pressure is 
4,650 psi at 10,000 feet, then the pressure is considered
to be normal.

Over-pressured reservoirs.  Reservoirs subject to abnormally 
high pressure as a result of certain types of subsurface 
formations.
 
Present value.  When used with respect to oil and natural 
gas reserves, the estimated future gross revenue to be 
generated from the production of proved reserves, net of 
estimated production and future development costs, using 
prices and costs in effect as of the date indicated, without 
giving effect to nonproperty-related expenses such as 
general and administrative expenses, debt service and future 
income tax expense or to depreciation, depletion and
amortization, discounted using an annual discount rate of 
10%.

Productive well.  A well that is found to be capable of 
producing hydrocarbons in sufficient quantities such that 
proceeds from the sale of such production exceed production 
expenses and taxes.

Proved developed nonproducing reserves.  Proved developed 
reserves expected to be recovered from zones behind casing 
in existing wells.

Proved developed producing reserves.  Proved developed 
reserves that are expected to be recovered from completion 
intervals currently open in existing wells and able to 
produce to market.

Proved developed reserves.  Proved reserves that can be 
expected to be recovered from existing wells with existing 
equipment and operating methods.

Proved reserves.  The estimated quantities of crude oil, 
natural gas and natural gas liquids that geological and 
engineering data demonstrate with reasonable certainty to be 
recoverable in future years from known reservoirs
under existing economic and operating conditions.

Proved undeveloped location.  A site on which a development 
well can be drilled consistent with spacing rules for 
purposes of recovering proved undeveloped reserves.

Proved undeveloped reserves.  Proved reserves that are 
expected to be recovered from new wells on undrilled acreage 
or from existing wells where a relatively major expenditure 
is required for recompletion.

Recompletion.  The completion for production of an existing 
well bore in another formation from that in which the well 
has been previously completed.

Reservoir.  A porous and permeable underground formation 
containing a
natural accumulation of producible oil and/or gas that is 
confined by impermeable rock or water barriers and is 
individual and separate from other reservoirs.

Royalty interest.  An interest in an oil and natural gas 
property entitling the owner to a share of oil or gas 
production free of costs of production.
 
3-D seismic data.  Three-dimensional pictures of the 
subsurface created by collecting and measuring the intensity 
and timing of sound waves transmitted into the earth as they 
reflect back to the surface.

Undeveloped acreage.  Lease acreage on which wells have not 
been drilled or completed to a point that would permit the 
production of commercial quantities of oil and natural gas 
regardless of whether such acreage contains proved
reserves.

Working interest.  The operating interest that gives the 
owner the right to drill, produce and conduct operating 
activities on the property and a share of production.

Workover.  Operations on a producing well to restore or 
increase production.

ITEM 3. Legal Proceedings.

Cronus, formerly known as TR-3 Industries, Inc., was in 
Chapter 7 bankruptcy from 1982 through 1992. The Company had 
no operations and substantially no assets or liabilities 
through November 1995.  The Company was subject to a 
number of lawsuits and claims (some of which involve 
substantial amounts) arising out of the conduct of its 
business prior to 1982, which were subject to the 
bankruptcy proceeding.  Although the Company does not 
currently possess sufficient information to reasonably 
estimate the amounts of liabilities to be recorded, they may 
be significant to the results of operations.  Management, 
however, is of the opinion that the statute of limitations 
relating to these liabilities has likely expired as of 
August, 1997, fifteen years after the filing of the 
bankruptcy.  Accordingly, the Company removed the 
liabilities from the balance sheet and recorded an 
extraordinary gain of $2,930,134 in the third quarter of 
1997.

ITEM 4. Submission of Matters to a Vote of Security Holders.

Cronus Corporation has not submitted any matter to vote of 
security holders during the period of this report.

PART II

ITEM 5. Market for Registrant's Common Equity and Related 
Stockholders Matters.

Trades in the common stock of the Company have been reported 
on the OTC Bulletin Board since March 5, 1996, under the 
symbol CRON.  The quarterly high and low prices for 1997 are 
as follows:

             	      High                Low
First Quarter       $0.94               $0.25
Second Quarter      $0.62               $0.13
Third Quarter       $0.81               $0.25
Fourth Quarter      $0.86               $0.50

The quarterly high and low prices for 1996 are as follows:

                     High                Low
First Quarter       $0.00               $0.00
Second Quarter      $3.25               $1.50
Third Quarter       $2.00               $0.50
Fourth Quarter      $1.81               $0.62

The foregoing are over-the-counter market quotations 
obtained through PC Quotes, which may reflect inter-dealer 
prices, without retail mark-up, mark-down or commission and 
may not represent actual transactions.

As of December 31, 1997, there were approximately 244 record 
holders (excluding brokerage firms and other nominees) of 
the Company's common stock.  The Company has not declared 
any dividends during the period of this report, and does not 
anticipate declaring any dividends in the foreseeable 
future.  The Company intends to retain any earnings for 
future operations and for the development of its business.

ITEM 6. Management's Discussion and Analysis of Financial 
Condition and Results of Operation.

Disclosure Regarding Forward-Looking Statements.
This report on Form 10-KSB includes "forward-looking 
statements" within the meaning of Section 27A of the 
Securities Act of 1933, as amended (the  "Securities  Act"), 
and Section 21E of the Securities Exchange Act of 1934, 
as amended (the "Exchange Act").  All statements other than 
statements of historical facts included in this report, 
including, without limitation, statements under "Business 
and Properties" and "Management's Discussion and Analysis of 
Financial Condition and Results of Operations" regarding the 
Company's financial position, reserve quantities and net 
present values, business strategy, plans and objectives of 
management of the Company for future operations and capital 
expenditures, are forward-looking statements and the 
assumptions upon which such forward-looking statements are 
based are believed to be reasonable.  The Company can give 
no assurance that such expectations and assumptions will 
prove to have been correct.  Reserve estimates of oil and 
gas properties are generally different from the quantities 
of oil and natural gas that are ultimately recovered or 
found.  This is particularly true for estimates applied to 
exploratory prospects.  Additionally, any statements 
contained in this report regarding forward-looking 
statements are subject to various known and unknown risks, 
uncertainties and contingencies, many of which are beyond 
the control of the Company.  Such things may cause actual 
results, performance, achievements or expectations to differ 
materially from the anticipated results, performance, 
achievements or expectations.  Factors that may affect such 
forward-looking statements include, but are not limited to, 
the Company's ability to generate additional capital, risks 
inherent in oil and gas acquisitions, exploration, drilling, 
development and production, price volatility of oil and gas, 
competition, shortages of equipment, services and supplies, 
government regulation, environmental matters, financial 
condition of the other companies participating in the  
exploration, development and production of oil and gas 
programs and other matters.  All written and oral forward-
looking statements attributable to the Company or persons 
acting on its behalf subsequent to the date of this report 
are expressly qualified in their entirety by this 
disclosure.

There has been limited operations this past fiscal year.  As 
the Company entered the natural resources market in March of 
1996, and sold AGAA, PBAA and TGII, the Company has embarked 
upon a new direction focusing on the acquisition, 
development and management of natural resources.  The 
Company sold AGAA and TGII because neither subsidiary had 
became operational, thereby raising significant doubts about 
their ability to earn income.  The Company sold the assets 
of PBAA after the results of their first quarter of 1996 
indicated that PBAA would not likely earn a profit in 1996 
or 1997.

In order to create revenues, and expand on its natural 
resources base, the Company acquired PetroSun Exploration & 
Production, Incorporated in 1997.  As described more fully 
below, management expects to receive income from PetroSun 
oil and gas leases in Louisiana and elsewhere sufficient to 
cover its operating costs by the end of 1998.

As can be seen in the financial statements, the Company has 
incurred losses from operations and has deficits in working 
capital and net worth.  The Company has earned only minimal 
income from its operations, however, it expects to receive 
income from oil and gas leases in Louisiana and elsewhere 
by the end of 1998.  The lack of significant revenues to 
date raises a doubt about the Company's ability to continue 
as a going concern.  Management expects to earn revenues in 
1998 and also expects to raise additional funding as 
needed.  There can be no assurance that a cash flow will be 
generated or that funding will be raised.  The Company 
currently has no commitments for any type of funding, and 
there is no assurance that the Company will be able to 
obtain any such financing or that such financing, if 
obtainable, will be on terms necessary to enable the Company 
to operate profitably.

During 1996, the Company acquired the Gila mining claims and 
Black Diamond mining claims (which it released in 1997), 
both in southern Arizona for $130,504.  The future 
realization of the cost of these mining claims is dependent 
upon the claims becoming proven reserves.  A proven reserve 
is the estimated quantity of mineral which geological and 
engineering data demonstrates with reasonable 
certainty to be recoverable in future years from known 
reservoirs under existing economic and operating conditions.  
Currently, these claims are considered unproven.  
Additionally, the claims were transferred to the Company 
without warranty or title assurance, and thus, the Company 
is uncertain as to the legal status of its interest, if any, 
in the claims.  See "Title To Mining Properties" above.

The Company, doing business as TR-3 Industries, Inc. was in 
chapter 7 bankruptcy from 1982 through 1992.  The Company 
had no operations and substantially no assets through 
November, 1995, when the Company then  acquired AGAA, TGII 
and PBAA.  As noted above, the Company sold AGAA, TGII and 
the assets of PBAA in 1996 and then entered the natural 
resources market, with the acquisition of the mining claims 
in 1996, and into the oil and gas field with the acquisition 
of PetroSun.  As of December 31, 1996, Cronus was possibly 
subject to a number of lawsuits, judgments and claims 
arising out of the conduct of business of TR-3 Industries, 
Inc. prior to 1983.  Liabilities not discharged in the 
bankruptcy totaled $2,930,134.00 which the Company had 
carried as a liability on its balance sheet.  However, in 
August 15, 1997, fifteen years after the bankruptcy filing, 
in the opinion of management, the statute of limitations has 
expired on these possible claims.  Accordingly, the Company 
removed the liabilities from the balance sheet and recorded 
an extraordinary gain of $2,930,134 during the third quarter 
of 1997.

Financial Requirements and Source of Funds.
The Company is currently rehabilitating the shut-in oil and 
gas wells by setting compressors and pumps which will allow 
PetroSun to put its remaining revenue producing assets in 
Louisiana into production starting in 1998.  Based on 
historical production rates, the Company believes that 
PetroSun's oil and gas production in Louisiana should 
produce net revenues sufficient to cover basic operating 
expenses of the Company of $30,000 per month.
 
Thereafter, the Company believes it will need to raise at 
least $1,500,000 in order to conduct testing and drilling of 
its oil and gas properties, and to conduct testing of the 
Moapa Project and the Gila Gold Placer Project.  Such 
funds may be sought through the issuance of additional 
shares of the Company's Common Stock or other equity 
securities, through debt financing, or through various 
arrangements, including joint ventures and/or mergers, with 
third parties.  However, the Company currently has no 
commitments for any type of funding, and there is no 
assurance that the Company will be able to obtain any 
such financing or that such financing, if obtainable, will 
be on terms necessary to enable the Company to operate 
profitably.  If the Company is unsuccessful in completing a 
private type  placement, or if additional funds are 
necessary either before or after such a transaction, it is 
uncertain at this time what actions the Company will take.  
Possibilities include other debt or equity financing or the 
sale of existing assets.

ITEM 7. Financial Statements.

Audited Balance Sheet for 1997.
See Item 13

ITEM 8. Changes in and Disagreements with Accountants on 
Accounting and Financial Disclosure.

See 8-K filed on November 7, 1996.

PART III

ITEM 9. Directors and Executive Officers of the Registrant.

At the time the Company's Chapter 7 case was concluded in 
1992, the Company's board of directors consisted of seven 
persons, all of whom resigned on or prior to July 14, 1992, 
other than Jeanette Bowen, who remained as a director, 
pursuant to the Company's by-laws, until the election and 
qualification of a successor.  On or prior to July 14, 1992, 
all of the Company's officers resigned from their respective 
positions, other than Jeanette Bowen, who remained as the 
sole officer of the Company.

Until February 2, 1998, the Company's shareholders have not 
met for an annual or other meeting since October 23, 1990.  
Consequently, in accordance with the Company's by-laws, 
Jeanette Bowen continued as the sole director of the 
Company until December 21, 1994, at which time she acted to 
appoint Jonathan Roberts as president, and as a director, 
filling one of the vacant directorships in accordance with 
the Company's by-laws.

After making such appointment, on December 14, 1995, 
Jeanette Bowen resigned as director with the result that 
Jonathan Roberts became the sole director of the Company.  
On July 22, 1996, Mr. Roberts, acting as sole director 
of the Company, appointed George Hennessey and Kevin 
Sherlock to be Directors of the Company, filling two of the 
vacant directorships in accordance with the Company's by-
laws.  Also on July 22, 1996, Kevin Sherlock was 
appointed as secretary of the Company.

The Company called and held a meeting of shareholders for 
February 2, 1998 for the purpose of electing directors, 
voting on the 1997 Employee Stock Option Investment Plan, 
ratifying the appointment of the Company's auditors, and 
taking other action as properly  came before the meeting.  
Seven Directors were elected at that meeting, and those 
directors elected officers of the Company at the director's 
meeting.

The following table shows the positions held by the 
Company's officers and directors.  The directors were 
elected for a term of one year and will serve until 
the next annual meeting of the Company's shareholders, and 
until their successors have been elected and have qualified.  
The officers were appointed to their positions, and continue 
in such positions, at the discretion of the directors.

    NAME               AGE  POSITION          TERM
Jonathan Roberts        39  President        1 year
  	                       Director

George Hennessey        52  Director         1 year

Kevin Sherlock          36  Secretary, Vice  1 year
                            President and Director

Gordon M. LeBlanc, Jr.  45  President of subsidiary
                           (PetroSun)
                            Director         1 year

J.  Dennis Bartlett     45  Chief Financial Officer
                            Director         1 year

Jim Karten              38  Director         1 year

Thomas J. Nieman        41  Director         1 year


JONATHAN ROBERTS, was originally appointed a director in 
December 1994, and appointed as President in December, 1994.  
He was elected a director at the shareholders meeting on 
February 2, 1998.  In addition to his management position 
with the Company, Mr. Roberts has been the General Manager 
of R K Management Group L. C. since 1993.

KEVIN SHERLOCK, was originally appointed a director and the 
Secretary in July, 1996.  In May, 1997, Mr. Sherlock was 
appointed Vice President in charge of Legal Affairs.  He was 
elected a director at the shareholders meeting on 
February 2, 1998.  An attorney since 1988,  Mr. Sherlock 
practiced aviation law and insurance defense litigation in 
Washington D.C. until 1993, when he then opened a solo 
practice assisting small businesses with various matters, 
including mergers and acquisitions.

GEORGE HENNESSEY, was appointed a director in July, 1996. He 
was elected a director on February 2, 1998.  He has been a 
geological consultant since 1977.  As a geological 
consultant, and in some instances as owner/operator, Mr. 
Hennessey has consulted for several major mining companies, 
at various exploration, development and production levels of 
involvement regarding surface, underground and offshore 
precious metals and base metal deposits and mill tailing 
recovery undertakings.  Mr. Hennessey is also a director, 
geological consultant, and shareholder of Temple Summit 
Financial Projects, Inc. ("TSFP").  The Company and TSFP are 
engaged in a joint venture project in Moapa, Nevada to test 
out the viability of extracting gold from mining claims held 
by TSFP.

GORDON M. LEBLANC, JR., has been an oil and gas operator for 
over 20 years.  Mr. LeBlanc is the president of PetroSun 
Exploration & Production, Incorporated, a wholly owned 
subsidiary of Cronus.  He was elected a director on February 
2, 1998.  Mr. LeBlanc is also president of Tiger Tool, Inc., 
an enhanced oil recovery technology and manufacturing 
company, and Tiger Energy, Inc., an enhanced oil recovery 
operating company.  Mr. LeBlanc is also a member of the 
Executive Committee of the Arizona Chapter of the NFL Alumni 
Association and is the founder and director of Every Kid 
Counts, a non-profit children's charity.

J. DENNIS BARTLETT, is a certified public accountant and the 
principal behind J. Dennis Bartlett, PC.  He was elected a 
director on February 2, 1998 and has acted as the Company's 
chief financial officer.  Mr. Bartlett has been in practice 
since 1975 and specializes in taxation, financial planning 
and consulting with closely held businesses and individuals.  
Mr. Bartlett's clients include large and small businesses 
and individuals in need of tax planning.

JIM KARTEN, has over 15 years experience in finance and 
investment.  He was elected a director on February 2, 1998.  
Mr. Karten is a consultant to the Company which negotiated 
and arranged for various sources of financing since 
the Company's inception.  Additionally, Mr. Karten is a 
principal behind Cumarin Limited, a consulting company 
incorporated in the Isle of Man, and is managing 
director of Karten Asset Management, a money management firm 
specializing in derivative trading of foreign and domestic 
currencies, indexes, bonds and energy for institutions and 
high net worth individuals.

THOMAS J. NIEMAN, has been a licensed commercial real estate 
agent since 1977, possessing a diverse background in 
brokerage, development and management. He was elected a 
director on February 2, 1998.  Additionally, Mr. Nieman is 
very active in community affairs in Tucson, Arizona, 
including being the President of the Tucson Mayor & 
Council's Downtown Advisory Committee.

Based solely upon a review of Forms 3 and 4 and amendments 
thereto furnished to the Company during its most recent 
fiscal year, and Form 5 and amendments thereto furnished to 
the Company with respect to its most recent fiscal year, and 
any written representation received by the Company, there is 
no person, except as disclosed below, who was a director, 
officer, or beneficial owner of more than 10 percent of any 
class of equity securities of the Company pursuant to 
Section 12 of the Exchange Act that failed to file on a 
timely basis reports required by Section 16(a) of the 
Exchange Act during the most recent fiscal year.

Based on the foregoing review, the Company believes the 
following persons failed to file on a timely basis reports 
required by Section 16(a) of the Exchange Act:   None.

ITEM 10. Executive Compensation.

SUMMARY COMPENSATION TABLE

                    ANNUAL COMPENSATION
Name and        Year   Paid	   Deferred    Royalty
Position        1997  Salary      Salary      Paid

Jonathan Roberts,
President, CEO
and Director          $3,000      $172,000    $44
_____________________________________________________
Kevin Sherlock,
Secretary and
Director             $37,500       $22,500    $22
_____________________________________________________
George Hennessey,
Director and Geological
Consultant                0             0      $0
_____________________________________________________
Gordon M. LeBlanc, Jr.
Director and
President of PetroSun $42,500	          0    $154
_____________________________________________________

Name and        Year   Paid	   Deferred    Royalty
Position        1996  Salary      Salary      Paid 

Jonathan Roberts,
President, CEO
and Director         $18,000      $157,000      0
_____________________________________________________
Kevin Sherlock,
Secretary and
Director             $10,500        $4,000  $3,187*
_____________________________________________________
George Hennessey,
Director and Geological
Consultant                0             0  $26,180*
_____________________________________________________

*Consists of Consulting and Expense reimbursement.


OPTION GRANTS IN FISCAL YEAR 1997

                  Number of   Percent  Exercise Expiration
                   Options   of Total    Price     Date
                   Granted    Options
                             Granted to
Name                          Employees
________________________________________________________
Jonathan Roberts   500,000      15%    $0.31 2-15-2002
__________________________________________or termination
Gordon M. LeBlanc 2,400,000	  70%    $0.50 3-31-2002
__________________________________________or termination
George Hennessey   500,000      15%    $0.50 6-5-2002
__________________________________________or termination

OPTION GRANTS IN FISCAL YEAR 1996

                  Number of   Percent  Exercise Expiration
                   Options   of Total    Price     Date
                   Granted    Options
                             Granted to
Name                          Employees
________________________________________________________
Kevin Sherlock    550,000       100%    $0.05  7-22-2001
__________________________________________or termination


AGGREGATED OPTIONS EXERCISED IN FISCAL YEAR 1997 AND 
FISCAL YEAR END OPTION VALUES
                 Shares    Value     Number of    Value of
                Acquired  Realized  Unexercised  Unexercised
                   on                Options at   Options at
Name            Exercise               FY-End       FY-End
					
____________________________________________________________
Jonathan Roberts    0        0   	  500,000     $120,000
____________________________________________________________
Kevin Sherlock	 550,000   275,000         0            0
____________________________________________________________
Gordon M. LeBlanc   0        0     2,400,000     $120,000
____________________________________________________________
George Hennessey    0        0       500,000      $25,000
____________________________________________________________

AGGREGATED OPTIONS EXERCISED IN FISCAL YEAR 1996 AND 
FISCAL YEAR END OPTION VALUES
                 Shares    Value     Number of    Value of
                Acquired  Realized  Unexercised  Unexercised
                   on                Options at   Options at
Name            Exercise               FY-End       FY-End
					
____________________________________________________________
Jonathan Roberts 2,000,000 $1,540,000       0           0
____________________________________________________________
Kevin Sherlock      0          0       550,000     $396,000
____________________________________________________________


In 1995 there was no cash compensation for officers and 
directors for performance of their duties.  Mr. Roberts was 
issued 1,000,000 shares of Common Stock of the Company in 
consideration of his services in 1995.  Also, as part of the 
Company's Executive Long-Term Stock Investment Plan, Mr. 
Roberts was granted an option to purchase 2,000,000 shares 
of Common Stock, which was exercised in 1996 for $2,000. 
Pursuant to the Executive Long-Term Stock Investment Plan, 
Mr. Roberts was granted an option in 1997 to purchase 
500,000 shares of Common Stock of the Company.

In 1997, Mr. Roberts also entered into a employment 
agreement with the  Company for $175,000 per year, of which 
$100,000 is deferred until the  Company obtains additional 
operating funds.  Mr. Roberts received total cash 
compensation of $18,000.00 in 1996, and $3,000 in 1997.

In 1997, the Company entered into an employment agreement 
with Mr. Sherlock for $60,000 per year.  Also, as part of 
the Company's Executive Long-Term Stock Investment Plan, Mr. 
Sherlock was granted, in 1996 the option to purchase 550,000 
shares of the Company's Common Stock.  Mr. Sherlock 
received employee compensation of $10,500.00, and $3,186.78 
in consulting and expense reimbursement, for a total cash 
compensation of $13,686.78, in 1996, and $37,500 in 1997.

In 1996, Mr. Hennessey received a total cash compensation of 
$26,180.26, in consulting fees and expense reimbursement.  
On June 4, 1997, the Company entered into a consulting 
agreement with its chief geological consultant, Mr. 
George Hennessey, with a term of two years.  The Consulting 
Agreement called for the issuance of 500,000 shares of the 
Company's Common Stock, granted Mr. Hennessey an option to 
acquire 500,000 shares of the Company's Common Stock, and 
provides for consulting fees in the amount of $4,000 per 
month while Mr. Hennessey is devoting himself to the Moapa 
project.  Mr. Hennessey has not received any consulting fees 
under the Consulting Agreement through December 31, 1997.

In 1997, Mr. LeBlanc received a total cash compensation of 
$42,500 pursuant to his employment agreement with PetroSun.

ITEM 11. Security Ownership of Certain Beneficial Owners and 
Management.
The following table sets forth, as of September 10, 1997, 
information regarding the beneficial ownership of shares of 
the Company's Common Stock by each person known by the 
Company to own five percent or more of the outstanding 
shares of the Company's Common Stock, by each of the 
officers and directors, and by the officers and directors as 
a group.

Name and Address of	         Amount of        Percent
Security Ownership         of Beneficial        of
Certain Beneficial           Ownership         Class 
Ownership of Management:

Jonathan Roberts             3,500,000*         19%
President and Director
660 S. Freeman Rd.
Tucson, Arizona  85748

Kevin Sherlock                 550,000           3%
43 E. 2nd Street
Tucson, Arizona  85705

George Hennessey             1,000,000*	         5.4%
4291 S. Polaris Ave., #A
Las Vegas, Nevada 89117

Gordon M. LeBlanc, Jr.       3,000,000**        16%
8129 N. 87th Place
Scottsdale, Arizona 85258

J.  Dennis Bartlett                  0            0
2461 E. 6th Street
Tucson, Arizona 85716

Jim Karten                      84,943           0.4%
440 Paseo Flamenco, #C
Rio Rico, Arizona 85648

Thomas J. Nieman                    0            0
5761 East 13th Street
Tucson, Arizona 85711

All Directors and Officers   8,034,943*** 	   43%

*Includes option to purchase 500,000 shares.
**Includes options to purchase 2,400,000 shares.
***Includes total options to purchase up to 3,400,000 
shares.

(1) Each person named in the table has sole voting and 
investment power with respect to all Common Stock 
beneficially owned by him or her, subject to applicable 
community property law, except as otherwise indicated.  
Except as otherwise indicated, each of such persons may be 
reached through the Company at 7660 East Broadway, Suite 
210, Tucson, Arizona 85710.

(2) The percentages shown are calculated based upon 
18,677,316 shares of Common Stock on December 31, 1997.  The 
numbers and percentages shown include the shares of Common 
Stock actually owned and outstanding as of December 31, 
1997, (15,277,316) and the shares of Common Stock that the 
identified person or group had the right to acquire within 
60 days of such date, (3,400,000).  In calculating the 
percentage of ownership, all shares of Common Stock that the 
identified person or group had the right to acquire within 
60 days of December 31, 1997 upon the exercise of options 
are deemed to be outstanding for the purpose of computing 
the percentage of the shares of Common Stock owned by such 
person or group, but are not deemed to be outstanding for 
the purpose of computing the percentage of the shares of 
Common Stock owned by any other person.

ITEM 12. Certain Relationships and Related Transactions.

No officer, director, nominee for election as a director, or 
associate of such officer, director or nominee is or has 
been in debt to the Company during the last fiscal year.

On April 3, 1997, the Company and Temple Summit Financial 
Projects Inc.  ("TSFP") entered into a Joint Venture 
Agreement to conduct testing regarding the viability of 
extracting gold from an area of mining claims held by Temple 
Summit.  The Company and Temple Summit will test the area 
and samples from the Moapa Project will be assayed.  If the 
assays reflect economical viable gold, the Joint Venture 
will proceed with the project.  Mr. George Hennessey is 
also a member of the board of directors of TSFP and he hold 
the position of chief geologist.  Additionally, Mr. 
Hennessey is a major shareholder of TSFP, holding 
approximately 10% of the outstanding shares.  The Board of 
Directors of the Company was aware of Mr. Hennessey's 
position with TSFP prior to approving the project.

On May 2, 1997, the Company purchased, for $12,000, an 
option to buy the outstanding stock of Grayhawk Oil and Gas, 
Inc., a company owned by Gordon M. LeBlanc, Jr., the 
president and key employee of PetroSun Exploration & 
Production, Incorporated, and now a director of Cronus.  The 
Board of Directors of the Company was aware of Mr. LeBlanc's 
position prior to approving the purchase of the option.

On July 24, 1997, Cronus entered a contract to obtain half 
of the outstanding shares of Tiger Energy Corporation, a 
company partially owned by Gordon M. LeBlanc., Jr., the 
president and key employee of PetroSun Exploration & 
Production, Incorporated, and now a director of Cronus.  
Tiger Energy is a Nevada corporation with an understanding 
to be the exclusive Enhanced Oil Recovery operating company 
for Tiger Tools, Inc., in the United States.  400,000 
out of the purchase price of 800,000 shares of the 
restricted common stock of Cronus was issued to shareholders 
of Tiger Energy on or about November 3, 1997.  The remaining 
400,000 shares of restricted common stock were issued 
on or about January 16, 1998 to complete the transaction.  
The Board of Directors of the Company was aware of Mr. 
LeBlanc's position prior to approving the purchase of the 
option.

There were no other related or reportable transactions.

PART IV

ITEM 13. Exhibits, Financial Statements Schedules and 
Reports on Form 8-K.

List of Exhibits.

1.  The Company's Articles of Incorporation, as amended.
2.  The Company's By-Laws, incorporated by reference from 
the 1995 10-KSB filed on April 15, 1997.
3.  The Company's Executive long-term Stock Investment Plan, 
incorporated by reference from the Proxy Statement filed on 
January 15, 1998.
4.  Employment Contract of Jonathan Roberts.
5.  Employment Contract of Kevin Sherlock.
6.  Reorganization agreement with PetroSun Exploration & 
Production, Incorporated, incorporated by reference from the 
Form 8-K filed on June 16, 1997.
8.  Employment Contract of Gordon M. LeBlanc, Jr., 
incorporated by reference from the Form 8-K filed on June 
16, 1997.
9.  Consulting Contract with George Hennessey, incorporated 
by reference from the 1996 10-KSB filed on October 15, 1997.
10. Contract for the sale of gas products to Louisiana 
Intrastate Gas.
11.  List of subsidiaries.
12.  Consent of Auditors.
Exhibit 27.  Financial Data Schedule as required by Item 601 
of Regulation SB.

Financial Statements and Financial Statement Schedules.

(a)	Independent Auditor's Report.
(b)	Balance Sheet December 31, 1997.
(c)	Statement of Operations for the years ended December 
     31, 1997 and 1996.
(d)	Statement of Changes in Stockholders' Deficit for the 
	years ended December 31, 1997 and 1996.
(e)	Statement of Cash Flows for the years ended December 
     31, 1997 and 1996.
(f)	Notes to Financial Statements.


Reports on Form 8-K.

During the fiscal quarter ending on March 31, 1997, no 
reports on form 8-K were filed.

During the fiscal quarter ending on June 30, 1997, one 8-K 
report was filed on June 16, 1997 containing the following 
items:

Item 2. Acquisition or Disposition of Assets.
Item 7. Financial Statements and Exhibits.

During the fiscal quarter ending on September 30, 1997, no 
8-K reports were filed.

During the fiscal quarter ending on December 31, 1997, no 8-
K reports were filed.

During 1998 through the date of this report, there were no 
8-K reports filed. 

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

CRONUS CORPORATION
DATE: June 15, 1998
Kevin M. Sherlock, Secretary and Director
On behalf of the Board of Directors.

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.

Date: June 15, 1998 By:

      /s/
Jonathan Roberts, President and Director

Date: June 15, 1998 By:

      /s/
Kevin M. Sherlock, Secretary and Director

Date: June 15, 1998 By:

      /s/
George Hennessey, Director

Date: June 15, 1998 By:

/s/
James Karten, Director

Date: June 15, 1998 By:

      /s/
J. Dennis Bartlett, Director

Date: June 15, 1998 By:

      /s/
Thomas J. Nieman, Director

CRONUS CORPORATION


CRONUS CORPORATION AND SUBSIDIARIES

Consolidated Financial Statements

For the years ended 
December 31, 1997 and 1996
	                    
TABLE OF CONTENTS
                                               Page

Independent Auditor's Report                     1
Consolidated Balance Sheet                       2-3
Consolidated Statements of Operations            4
Statements of Changes in Consolidated
  Stockholders' Deficit                          5
Consolidated Statements of Cash Flows            6-7
Notes to Financial Statements                    8-18
Supplementary Information:
  Consolidating Balance Sheet                    20-21
  Consolidating Statement of Operations	         22
Unaudited Supplementary Information:
  Supplementary Reserve Information (Unaudited)  24-25



INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
Cronus Corporation and Subsidiaries 

We have audited the accompanying consolidated balance sheet 
of Cronus Corporation and Subsidiaries as of December 31, 
1997, and the related consolidated statements of operations, 
changes in stockholders' deficit, and cash flows for the 
years ended December 31, 1997 and 1996.  These consolidated 
financial statements are the responsibility of the Company's 
management.  Our responsibility is to express an opinion on 
these consolidated 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 audits to obtain reasonable 
assurance about whether the consolidated financial 
statements are free of material misstatement.  An audit 
includes examining, on a test basis, evidence supporting the 
amounts and disclosures in the consolidated 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 consolidated financial statements 
referred to above present fairly, in all material respects, 
the financial position of Cronus Corporation and 
Subsidiaries as of December 31, 1997, and the results of 
their operations and their cash flows for the years ended 
December 31, 1997 and 1996, in conformity with generally 
accepted accounting principles.

Our audit was made for the purpose of forming an opinion on 
the basic consolidated financial statements taken as a 
whole.  The supplementary information on pages 19-22 is 
presented for the purpose of additional analysis and is not 
a required part of the basic consolidated financial 
statements.  Such information has been subjected to the 
auditing procedures applied in the audit of the basic 
consolidated financial statements and, in our opinion, is 
fairly stated in all material respects in relation to the 
basic consolidated financial statements taken as a whole.

The accompanying financial statements have been prepared 
assuming the Company will continue as a going concern.  As 
discussed in Note 1 to the consolidated financial 
statements, the Company has incurred recurring losses from 
operations and has a deficit in working capital and net 
worth.  These conditions raise substantial doubt about its 
ability to continue as a going concern.  Management's plans 
regarding those matters also are described in Note 1.  The 
financial statements do not include any adjustments that 
might result from the outcome of this uncertainty. 

June 10, 1998
Tucson, Arizona


CRONUS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET
December 31, 1997


          ASSETS

Current assets:
  Cash and cash equivalents                 $     1,195
  Other current assets                            3,356
  Accounts receivable                            10,338
  Prepaid consulting fees                       125,000
    Total current assets                        139,889

Oil and gas properties, using successful efforts accounting:
  Proved property                               217,728
  Unproved properties                           121,390
  Wells and related equipment and facilities      5,200
    Total oil and gas properties                344,318
Less accumulated amortization and depletion      (1,543)
    Net oil and gas properties                  342,775

Other assets:
  Prepaid consulting                             31,250	
  Deposits                                        1,802
  Office equipment, net of 
    accumulated depreciation of $3,062            5,351
  Receivable from related company                19,212
  Investment in mining claims                   143,530
  Goodwill, net of accumulated amortization and
    valuation allowance of $604,355             516,829
    Total other assets                          717,974
    Total assets                           $  1,200,638

(The accompanying notes are an integral part of the 
financial statements.)

CONSOLIDATED BALANCE SHEET, Continued
December 31, 1997

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
  Bank overdraft                           $     4,518
  Drilling advance                              26,300
  Accrued payroll and related taxes            392,162
  Accounts payable                             171,347
  Revenue distribution                           4,536
  Accrued interest                               4,356
  Due to related party                         439,976
  Notes payable - officers, shareholders and related 
   entities                                     80,129
  Notes payable - other, net of non-current portion
                                               146,243
    Total current liabilities                1,269,567

Non-current liabilities:
  Notes payable - other                         16,000
  Investment in joint venture                   40,508
    Total liabilities                        1,326,075

Commitments and contingencies (Notes 3, 6, 10 and 14)		

Stockholders' equity:
  Common stock, $.001 par value; 40,000,000 shares 
authorized, 15,283,106 shares issued and 15,033,1096 shares 
outstanding                                     15,284
  Additional paid in capital                 1,801,826
  Receivable from the sale of common stock    (175,981)	
  Accumulated deficit                       (1,766,316)
                                              (125,187)
  Treasury stock; 250,000 shares at cost          (250)
    Total stockholders' deficit               (125,437)
    Total liabilities and stockholders' deficit
                                           $ 1,200,638

(The accompanying notes are an integral part of the 
financial statements.)

CRONUS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
For the years ended December 31, 1997 and 1996

                                      1997           1996	
Revenues:
  Oil and gas sales             $    10,193
  Other                               2,000
    Total revenues                   12,193

Operating expenses:				
  Lease operation and exploration    63,953
		
  Salaries and related taxes        272,440      $ 215,042
  Professional fees                 151,932        234,392 
Depreciation and depletion            3,511
  Other general and administrative   56,365         10,825
    Total operating expenses        548,201        460,259

Loss from operations               (536,008)      (460,259)

Other expenses:
  Equity in net loss of subsidiaries                46,924
  Amortization of goodwill          129,207
  Goodwill valuation adjustment     439,952
  Interest expense                    5,377         24,044
  Loss on sale of subsidiaries                         607
    Total other expenses            574,536         71,575

Net loss before income taxes and extraordinary item
                                 (1,110,544)      (531,834)
Income tax provision                     50
Net loss before extraordinary item
                                 (1,110,594)     ( 531,834)
Extraordinary item - gain on forgiveness of debt
  (net of applicable income taxes of -0-)
                                  2,930,134	
	
Net income (loss)               $ 1,819,540     $ (531,834)

Earnings (loss) per common share:
  Loss before extraordinary item    $ (.08)         $ (.06)
  Extraordinary item                   .22
    Net income (loss)               $  .14          $ (.06)

Earnings per share - assuming dilution:
  Loss before extraordinary item   $  (.08)         $ (.06)
  Extraordinary item                   .22		
    Net income (loss)	            $ .14          $ (.06)

(The accompanying notes are an integral part of the 
financial statements.)

CRONUS CORPORATION AND SUBSIDIARIES

STATEMENTS OF CHANGES IN CONSOLIDATED STOCKHOLDERS' DEFICIT
For the years ended December 31, 1997 and 1996

  Common Stock   Additional Receivable
          Par    Paid in    From Sale of  Accumulated  
Treasury
 Shares  Value   Capital   Common Stock    Deficit     Stock     
Total
 
Balance at December 31, 1995
10,646,762 $10,647   $500                $(3,054,017)      
$(3,042,870)
Sale of subsidiaries                            $(3,364)   
(3,364)
Stock issued to consultants
1,035,000   1,035  154,215                                      
155,250
Stock options exercised
2,000,000   2,000                                                 
2,000
Net loss for the year ended December 31, 1996
                                           (531,839)          
(531,839)

Balance at December 31, 1996
13,681,762  13,682  154,715              (3,585,856) (3,364) 
(3,420,823)
  Retire treasury stock
(3,114,000)  (3,114)                                   3,114        
-0-
  Exchange of stock for note payable
    70,744      71   35,257                                      
35,328
  Exercise of stock warrants
   500,000    500                                                   
500
  Exchange of stock for note payable
   550,000    550    26,950                                      
27,500
  Sale of stock
   200,000    200    99,800                                     
100,000
  Sale of stock
    60,000     60    29,940                                      
30,000
  Exchange of stock for note payable
   120,000    120    59,880                                      
60,000
  Sale of stock
   400,000    400    99,600                                     
100,000
  Exchange of stock for note payable
   814,600    815   387,755                                     
388,570
  Purchase of Petrosun Exploration and Production, Inc.
   600,000    600   263,371                                     
263,971
  Purchase of Strategic Consulting, Inc.
   500,000    500   219,477                                     
219,977
  Receivable from sale of common stock
   400,000    400   175,581  (175,981)                              
-0-
  Stock issued to consultant
   500,000    500    249,500                                    
250,000	
  Net income for the year ended December 31, 1997
                                           1,819,540          
1,819,540
Balance at December 31, 1997
15,283,106   $15,284  $1,801,826  $(175,981)  $(1,766,316)  
$(250)  $(125,537)

(The accompanying notes are an integral part of the 
financial statements.)

CRONUS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 1997 and 1996

                                          1997        1996
Cash flows from operating activities:
Net income (loss)                 ,m  $ 1,819,540 $(531,839)
Adjustments to reconcile net income (loss) to net cash used 
in operating
 activities:
    Depreciation and depletion              3,511    1,094
    Amortization of prepaid consulting fees 93,750
    Amortization and valuation of goodwill 569,159
    Extraordinary gain                  (2,930,134)
    Stock issued for professional fees              155,250
    Loss on sale of subsidiaries                        607
    Equity in net loss of subsidiaries               46,929
Change in operating assets and liabilities:
    Stockholder receivable                  2,000    (2,000)
    Accounts payable                       27,611    16,111
    Accrued interest                      (19,688)   24,044
    Deposits                                         (1,102)
    Accrued payroll and related taxes     175,768   187,228
    Accounts receivable                   (10,338)
    Other current assets                      377
    Receivable from related company        (4,497)
    Revenue distribution                    4,536
    Drilling advance                       26,300       -0-
      Total adjustments                (2,061,645)  428,161
      Net cash used in operating activities
                                         (242,105) (103,678)

Cash flows from investing activities:
    Purchase of mining claims              (5,998) (137,532)
    Proceeds from sale of subsidiaries                  100
    Advances to subsidiary                          (51,000)
    Purchase of equipment                  (2,942)   (5,471)
    Cash advanced to joint venture         (5,900)
    Purchase of oil and gas properties   (326,628)      -0-
      Net cash used in investing activities
                                         (341,468) (193,903)

Cash flows from financing activities:
    Stock options exercised	                        2,000
    Borrowings on notes payable to stockholders and officers
                                           208,130  320,328
    Increase in bank overdraft               4,518
    Borrowings on other notes payable      162,243
    Principal payments on notes payable to officers and 
shareholders                               (46,000)
    Proceeds from sale of common stock     230,500	
	Net cash provided by financing activities
                                           559,391  322,328
Net increase (decrease) in cash            (24,182)  24,747
Cash and cash equivalents, beginning of year
                                            25,377      630
Cash and cash equivalents, end of year     $ 1,195 $ 25,377

Supplemental disclosures of cash flow information:
    Cash paid during the year for
        Interest                            $ -0-     $ -0-
        Taxes                                  50       -0-

(The accompanying notes are an integral part of the 
financial statements.)

CRONUS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
1.  Organization and Going Concern
The consolidated financial statements include the accounts 
of Cronus Corporation and its wholly-owned subsidiaries 
Petrosun Exploration and Production, Inc. and Strategic 
Consulting, Inc., collectively referred to as the 
Company. 

Cronus Corporation, formerly Thunderstone Group, Inc., 
formerly Diversified American Industries, Inc., formerly TR-
3 Industries, Inc., was incorporated in the State of Nevada 
in 1979.  The Company is primarily engaged in the 
acquisition and sale of privately held corporations.

Strategic Consulting, Inc. (SCI), an Arizona Corporation, 
provides personal and corporate consulting services.  SCI 
had no operations during 1997.

Petrosun Exploration and Production, Inc., (Petrosun) 
operates oil and gas wells in northern Louisiana.

As shown in the accompanying financial statements, the 
Company has incurred recurring losses from operations and 
has a deficit in working capital and net worth.  As a 
result, the Company has been unable to pay its debts and has 
issued common stock to meet its obligations as they come 
due.  These factors raise substantial doubt about the 
Company's ability to continue as a going concern.

Management is working to obtain additional financing through 
the issuance of stock and long-term debt.  This inflow of 
cash will be used to fund ongoing exploration and 
development of various oil and gas properties.  The 
financial statements do not include any adjustments that 
might result from the outcome of this uncertainty.

2.  Summary of Significant Accounting Policies

Consolidation
The consolidated financial statements include the accounts 
of the company and its subsidiaries after elimination of all 
significant intercompany accounts and transactions, and 
include the results of operations of purchased businesses 
from the dates of acquisition.

Cash and Cash Equivalents
For purposes of the statements of cash flows, the Company 
considers all highly liquid debt instruments with a 
purchased maturity of three months or less to be 
cash equivalents.

Oil and Gas Properties
The Company uses the successful efforts method of accounting 
for oil and gas producing activities.  Costs to acquire 
mineral interests in oil and gas properties, to drill and 
equip exploratory wells that find proved reserves, and to 
drill and equip development wells are capitalized.  Costs to 
drill exploratory wells that do not find proved reserves, 
geological and geophysical costs, and costs of 
carrying and retaining unproved properties are expensed.

Unproved oil and gas properties that are individually 
significant are periodically assessed for impairment of 
value, and a loss is recognized at the time of 
impairment by providing an impairment allowance.  Other 
unproved properties are amortized based on the Company's 
experience of successful drilling and average holding 
period.  Capitalized costs of producing oil and gas 
properties, after considering estimated dismantlement and 
abandonment costs and estimated salvage values, are 
depreciated and depleted by the unit-of-production method.  
Support equipment and other property and equipment are 
depreciated over their estimated useful lives.

On the sale or retirement of a complete unit of a proved 
property, the cost and related accumulated depreciation, 
depletion, and amortization are eliminated from the property 
accounts, and the resultant gain or loss is recognized.  On 
the retirement or sale of a partial unit of proved property, 
the cost is charged to accumulated depreciation, depletion, 
and amortization with a resulting gain or loss recognized in 
income.

On the sale of an entire interest in an unproved property 
for cash or cash equivalent, gain or loss on the sale is 
recognized, taking into consideration the amount of any 
recorded impairment if the property had been assessed 
individually.  If a partial interest in an unproved property 
is sold, the amount received is treated as a reduction of 
the cost of the interest retained.

Equipment
Equipment is recorded at cost and depreciated using the 
straight-line method over the estimated useful lives of the 
related assets.

Investment in Joint Venture
The investment in joint venture is accounted for using the 
equity method.  Under the equity method, the original 
investment is recorded at cost and is reduced to reflect a 
pro rata share of losses and distributions received, and 
increased to reflect a pro rata share of income and 
contributions made.  At December 31, 1997 the Company's 
share of the joint venture's losses exceeded the carrying 
amount.  This excess has been reflected as a liability 
because the Company has guaranteed the joint venture's 
obligations.

Income Taxes
Income taxes are recognized during the year in which 
transactions enter into the determination of financial 
statement income, with deferred taxes being provided 
for temporary differences between amounts of assets and 
liabilities for financial reporting purposes and such 
amounts as measured by tax laws.

Accounting Estimates
The preparation of financial statements in conformity with 
generally accepted accounting principles requires management 
to make estimates and assumptions that affect the reported 
amounts of assets and liabilities and disclosure of 
contingent assets and liabilities at the date of the 
financial statements and reported amounts of revenues and 
expenses during the reporting period.  Actual results could 
differ from those estimates.

Fair Value of Financial Instruments
The Company reports that the carrying amount of cash and 
cash equivalents, accounts receivable, receivables from 
related companies, drilling advances, bank overdraft, 
accrued expenses, accounts payable and notes payable 
approximate fair value due to the short maturity of these 
instruments.

It is not practicable to estimate the fair value of the 
Company's investment in joint venture without incurring 
excessive cost.  However, management believes that the 
carrying amount approximates fair value at December 
31, 1997.

Advertising
The cost of advertising is expensed when the advertisement 
first takes place.  The Company does not participate in 
direct response advertising that requires the capitalization 
and amortization of related costs.

Stock-Based Compensation
The Company accounts for its employee-based compensation 
arrangements under the provisional of APB No. 25, Accounting 
for Stock Issued to Employees, and intends to continue to do 
so.

Per Share Data
Earnings (net loss) per share is computed based on the 
weighted average number of shares outstanding during the 
year. 

3.	Investment in Mining Claims
During 1996, the Company purchased various mining claims in 
southern Arizona for $130,504.  The future realization of 
the cost of these mining claims is dependent upon the claims 
becoming proven reserves.  A proven reserve is the 
estimated quantity of mineral which geological and 
engineering data demonstrate with reasonable certainty to be 
recoverable in future years from known reservoirs under 
existing economic and operating conditions.  Currently, 
these claims are considered unproven.

Based on current estimates, management does not feel a 
valuation allowance against the cost of these claims is 
currently necessary.  However, it is at least reasonably 
possible that these estimates will change in the near term 
due to one or more future events.  The effect of the change 
would be material to these financial statements.

In order to estimate any possible environmentally related 
liability, a phase 1 environmental site assessment was 
performed on each of the mining claims.  The assessment 
revealed no evidence of recognized environmental conditions.

4. Investments in Subsidiaries

AGAA and TGII
On February 27, 1996, the Company sold its 100% owned 
subsidiaries AGAA and TGII to Applied Logic, Inc. in return 
for 3,114,000 shares of Company stock, 500,000 shares of 
Applied Logic stock, and a note receivable of $500,000.  The 
Company recorded treasury stock of $3,114 and a net gain on 
sale of $3,114 relating to the transaction.  Management has 
determined the note to be uncollectible and the stock of 
Applied Logic to have no value, and accordingly wrote off 
these assets during 1996 against the gain on sale.  

Subsequent to the sale of AGAA and TGII to Applied Logic, 
the Company changed its name from Thunderstone Group, Inc. 
to Cronus Corporation and Applied Logic changed its name to 
Thunderstone Group, Inc.  The Company's equity in AGAA's and 
TGII's net losses during the period January 1, 1996 through 
February 27, 1996 was zero. 

PBAA
On July 18, 1996, the Company sold the assets of its 100% 
owned subsidiary PBAA for $100 cash and 250,000 shares of 
Company stock.  The Company recorded treasury stock of $250 
and a loss of $3,721 relating to this transaction.  The 
Company's equity in PBAA's losses totaled $46,929 during 
the period January 1, 1996 through July 18, 1996.

Petrosun
During 1997, the Company purchased 100% of the outstanding 
common stock of Petrosun Exploration and Production, Inc., 
an Arizona corporation, in exchange for 600,000 restricted 
shares of the Company's common stock valued at $263,971.  In 
connection with the purchase, the Company assumed  
preexisting debt to creditors of Petrosun in the amount of 
$198,203.  The excess of the purchase price over the value 
of net assets acquired totaled $426,036.

Strategic Consulting
During 1997, the Company purchased 100% of the outstanding 
stock of Strategic Consulting, Inc.  The purchase price 
consisted of 1,000,000 shares of restricted Cronus stock 
with a fair market value of $439,952 and $220,000 cash.  
Of the purchase price, $220,000 cash and 500,000 shares of 
stock will be paid in 1998;  therefore $439,976 has been 
recorded as a current liability at December 31, 1997.  The 
excess of the purchase price over the net book value 
of the assets acquired totaled $659,952.

The following represents the unaudited pro forma results of 
consolidated operations as if the above-noted business 
combinations had occurred at the beginning of 1997 and 1996.

                                         1997        1996
     Revenues	                       $ 16,729     $  -0-
     Net income (loss)             $ 1,819,540  $ (716,281)
     Pro forma income (loss) per common share
                                       $  .14      $ (.06)

The unaudited pro forma results are not necessarily  
indicative of the results that would have been attained had 
the acquisitions occurred at the beginning of 1996, or of 
the results which may occur in the future.

5.	Goodwill
The Company has classified as goodwill the cost in excess of 
fair value of the net assets of companies acquired in 
purchase transactions.  Goodwill is being amortized on  a 
straight-line method over five years.  Amortization charged 
to continuing operations amounted to $129,207 and $-0- for 
1997 and 1996, respectively.  At each balance sheet date, 
the Company evaluates the realization of goodwill based upon 
expectations of non-discounted cash flows and operating 
income for each subsidiary having a material goodwill 
balance.  Based on its most recent analysis, the Company 
recorded a fourth quarter charge of $439,952.  The 
unamortized balance of goodwill totaled $516,829 at 
December 31, 1997.

6.	Notes Payable 
A summary of notes payable to stockholders and officers at 
December 31, 1997 follows:		

Unsecured demand note payable to a Director bearing interest 
at 10% annually.                                    $ 5,000

Unsecured note payable to a shareholder, bearing interest at 
10%, due July, 1998.                                 18,729

Unsecured notes payable to a company partially owned by a 
Director, bearing interest at 8%, due June, 1998.    56,400

                                                   $ 80,129

Accrued interest on notes payable to stockholders and 
officers totaled $4,356 at December 31, 1997.

A summary of other notes payable at December 31, 1997 
follows:		

Note payable bearing interest at 8%, due June 1998, 
unsecured.                                        $ 30,000

Note payable bearing interest at 8% due April 1999 unsecured 
                                                    16,000

Note payable bearing interest at 10%, due July 1998, 
unsecured.
                                                    15,000

Notes payable bearing interest at 10%, due August through 
December 1998, unsecured.                          101,243

                                             $     162,243

A summary of other notes payable maturities at December 31, 
1997 follows:
1998       $ 146,243
1999          16,000
           $ 162,243

7.  Receivable From Sale of Common Stock
During 1997, the Company issued 400,000 shares of 
restricted, unregistered common stock valued at $175,981.  
The stock was issued to the shareholders of Tiger Energy 
Corporation (Tiger) for the purchase of 25% of Tiger's 
outstanding stock.  Tiger stock was not issued to Cronus 
until January 15, 1998;  therefore, the related receivable 
has been recorded as an increase to stockholders' deficit at 
December 31, 1997.  Subsequent to December 31, 1997, the 
Company purchased an additional 25% of Tiger's outstanding 
stock by issuing 400,000 additional shares of Cronus stock.

8.  Extraordinary Item
Cronus, d.b.a. TR-3 Industries, Inc. was in Chapter 7 
bankruptcy from 1982 through 1992.  The Company had no 
operations and substantially no assets through November 
1995.  At December 31, 1996, Cronus was subject to a 
number of lawsuits, judgments and claims (some of which 
involve substantial amounts) arising out of the conduct of 
its business prior to 1983.  These liabilities not  
discharged in the Chapter 7 bankruptcy totaled $2,930,134 at 
December 31, 1996.

In August 1997, the fifteen year statute of limitations 
expired on these liabilities.  Accordingly, the Company 
removed the liabilities from the balance sheet and 
recorded an extraordinary gain of $2,930,134.

9.  Income Taxes
The Company's deferred tax assets consist of the following:
                           December 31,  1997         1996	
Current:
 Net operating loss carryforwards     $ 164,000   $ 107,000
 Accrued officer salaries                93,000      53,000
 Liabilities not discharged in bankruptcy   -0-     103,000
Non-Current:
 Goodwill                               125,000         -0-
Total deferred tax assets               382,000     263,000
Valuation reserve                      (382,000)   (263,000)
Net deferred tax assets                  $  -0-     $  -0-

The valuation allowance increased $119,000 in the year ended 
December 31, 1997 to fully offset deferred tax balances.

Temporary differences between the net operating losses for 
financial reporting and income tax purposes primarily relate 
to accrued officer salaries and goodwill amortization.

At December 31, 1997, the Company has a net operating loss 
carryforwards for federal and state income tax purposes of 
approximately $680,000.  These federal and state 
carryforwards will begin to expire in 2010 and 2000, 
respectively, if not previously utilized.  Utilization of 
the Company's net operating loss carryforwards may be 
subject to limitations due to the "change in ownership" 
provisions of the Internal Revenue Code of 1996, as amended, 
as a result of the Company's issuances of equity securities.  
These carryforwards, therefore, may expire prior to being 
fully utilized.  Future financings may cause additional 
changes in ownership and further limitations on the use of 
federal net operating loss carryforwards.

10.	Related Party Transactions
During 1997, the Company executed three employment contracts 
with officers and directors that provide for minimum annual 
compensation of $295,000 and expire in 1999 through 2003.  
Certain officers also receive an overriding royalty interest 
of .5% to 1.0% in all oil and gas leaseholds operated by the 
Company.  The contracts contain provisions where a portion 
of the compensation is to be deferred until the Company is 
generating sufficient income, as described in the agreement.  
At December 31, 1997, $388,246 has been included in accrued 
payroll and related taxes resulting from these agreements.

During 1997, the Company issued 500,000 shares of 
restricted, unregistered common stock to a Director for 
consulting services to be provided over a two-year term 
beginning April, 1997.  In connection with this transaction, 
the Company has included prepaid consulting fees of $156,250 
at December 31, 1997.

During 1997, an officer exercised options to purchase 
550,000 shares of common stock.  As payment for the options, 
the Company canceled $27,500 of notes payable to the 
officer.

During 1997, the Company issued to officers and Directors 
3,400,000 options to purchase restricted, unregistered 
common stock.

During July 1996, the Company entered into employment 
contracts with two key personnel that provide for minimum 
annual compensation of $223,000 and expire in July, 2000 and 
2002.  The contracts contain provisions whereby $112,000 of 
annual compensation shall be deferred until July 1997, or 
until such time as management determines the Company has 
generated sufficient cash flow.  At December 31, 1996, 
$212,297 of salaries and related taxes have been included in 
accrued salaries and related payroll taxes on the  
accompanying balance sheet.  

In December 1996, an officer exercised options to purchase 
2,000,000 shares of restricted, unregistered common stock 
for $0.001 per share. 

The Company granted an officer options to purchase 550,000 
shares of restricted, unregistered, common stock in 
connection with the Stock Option Plan described below.  The 
options may be exercised on an installment basis during 
the period February, 1997, through July, 1997, in accordance 
with the terms of the agreement.  The options were granted 
at the estimated market price of $0.05 per share on the date 
of the grant, July 22, 1996, and expire July 22, 2001.

During 1996, the Company paid $42,174 to officers of the 
Company for consulting services, of which $23,930 has been 
expensed and $18,244 has been capitalized in investment in 
mining claims.

In January 1996, the Company issued 1,035,000 shares of 
unrestricted stock as payment for professional services. 
Current officers and directors have received 320,000 shares 
under this offering for accounting and legal services 
totaling $48,000.

11.	Stock Option Plan
During 1995, the Company adopted a non-compensatory 
incentive stock option plan (the Plan).  The Plan provides 
for the granting of incentive stock options by the Board to 
directors, officers and key employees of the Company.

Under the terms of the Plan, options granted have an 
exercise price of 110% of the fair market value of the 
underlying stock at the date of grant.  Further, the 
options have a vesting period of one year and expire five 
years from the date of grant.

During 1997, the Company granted various officers and 
Directors options to purchase a total of 3,400,000 shares of 
restricted, unregistered common stock.  The options were 
granted at an exercise price ranging from $.31 to $.50 per 
share, approximately fair value at the grant date.

In July 1996, the Company granted an officer options to 
purchase 550,000 shares of restricted, unregistered common 
stock in connection with the Plan.  The options were granted 
at $.05 per share, approximately their fair value at the 
grant date.

The Company granted an officer options to purchase 2,000,000 
shares of restricted, unregistered common stock in 
connection with the Plan.  The options were granted at the 
estimated market price of $.001 per share on the date of the 
grant, December 15, 1995.  These options were exercised 
during 1996.

A summary of stock option activity during 1997 follows:
                          Number of     Per share     Total
                           Shares        Average      Price	
Shares under option at 
December 31, 1996	       550,000     $  .05     $  27,500
Granted                  3,400,000        .47     1,605,000
Exercised                 (550,000)       .05       (27,500)
Shares under option at 
December 31, 1997        3,400,000      $ .47   $ 1,605,000
Shares exercisable at
December 31, 1997        2,433,333      $ .47   $ 1,153,333

The Company has elected to follow Accounting Principles 
Board Opinion No. 25, Accounting for Stock Issued to 
Employees (APB No. 25) and related interpretations in 
accounting for its stock options because, as discussed 
below, the alternative fair value accounting provided for 
under Statement of Financial Accounting Standards No. 123, 
Accounting for Stock-Based Compensation (SFAS No. 123), 
requires the use of option valuation models that were not 
developed for use in valuing employee stock options.  Under 
APB No. 25, because the exercise price of the Company's 
stock options equals or exceeds the fair market value of the 
underlying stock on the dates of grant, no compensation 
expense is recognized.

Pro forma information regarding net income (loss) and net 
income (loss) per share is required by SFAS No. 123, and 
such information has been determined as if the Company has 
accounted for its employee stock options under the fair 
value method of that statement.  The fair value for these 
options was estimated at the date of grant using a Black-
Scholes option pricing model with the following weighted 
average assumptions for 1997 and 1996:  risk-free interest 
rate of 5.5%, dividend yield of 0%, volatility factor of the 
expected market price of the Company's common stock of 1.002 
and .1611, and a weighted-average expected life of the 
options of 4 years.

The Black-Scholes option valuation model was developed for 
use in estimating the fair value of trade options which have 
no vesting restrictions and are fully transferable.  In 
addition, option valuation models require the input of 
highly subjective assumptions including the expected stock 
price volatility.  Because the Company's stock options have 
characteristics significantly different from those traded 
options, and because changes in the subjective input 
assumptions can materially affect the fair value estimate, 
in management's opinion, the existing models do not 
necessarily provide a reliable single measure of the fair 
value of its stock options.

For purposes of pro forma disclosures, the estimated fair 
value of the options is amortized to expense over the 
related vesting period.  The Company's pro forma 
information follows:
                                     1997          1996
Net income (loss) as reported    $ 1,819,540   $ (531,834)
Pro forma compensation expense for stock options:			
1997 grants                          273,695
1996 grants                                        72,720
Pro forma net income (loss)      $ 1,545,845   $ (604,554)
Pro forma income (loss) per share     $ .11       $ (.06)

Pro forma compensation expense presented may not be 
representative of future pro forma expense, when  
amortization of multiple years of awards may be reflected.

12.  Non-Cash Investing and Financing Transactions
The Company executed the following non-cash transactions 
during 1997:	
Issue common stock in exchange for notes payable. 
                                            $ 511,398

Issue common stock to a related party for consulting 
services.                                     250,000

Issue common stock to purchase 100% of common stock of 
Petrosun.                                     426,036

Issue common stock to purchase 100% of common stock of 
Strategic Consulting.                         439,952

Receivable from sale of common stock.         175,981

Retire treasury stock                          (3,114)

                                         $  1,800,253

The Company executed the following non-cash transactions 
during 1996:

Three subsidiaries were sold during 1996 resulting in an 
increase in treasury stock of $3,364 and a net loss of $607.

On January 24, 1996, the Company issued 1,035,000 shares of 
registered, unrestricted common stock to advisors, officers 
and consultants for $0.15 per share (Note 7).  The Company 
recorded professional fee expense of $155,250, common stock 
of $1,035 and $154,215 of additional paid in capital 
relating to this transaction.

13.  Earnings Per Share
                       For the year ended December 31, 1997	
                          Income      Shares     Per-Share	
Basic EPS:
Income available to common
  stockholders        $  1,819,540    13,405,994     $ .14
Effect of dilutive securities -
  stock options                -0-        83,700		
Diluted EPS:
  Income available to common stockholders plus 
   assumed conversion $  1,819,540    13,489,694     $ .14

Options to purchase 2,900,000 shares of common stock at $.50 
per share were outstanding during 1997 but were not included 
in the computation of diluted EPS because the option's 
exercise price was greater than the average market price of 
the common shares.  The options, which expire June 2000 
through February 2002  were still outstanding at December 
31, 1997.
                                                               
                       For the year ended December 31, 1996
                        Income(Loss)   Shares     Per-Share	
Basic EPS:
Income available to common
  stockholders          $  (531,834)   8,641,173   $ (.06)
Effect of dilutive securities -
  stock options                 -0-          -0-		
Diluted EPS:
  Income available to common stockholders plus 
   assumed conversion   $  (531,834)   8,641,173   $ (.06)

Options to purchase 550,000 shares of common stock at $.05 
per share were outstanding during 1996, but were not  
included in the computation of diluted EPS because the 
effect would be antidilutive.

14.  Commitments and Contingencies
The Company was subject to a number of lawsuits, judgments 
and claims (some of which involved substantial amounts) 
arising out of the conduct of its business prior to 1983. In 
the opinion of management, applicable statute of limitations 
bar these claims.  However, if not barred, these liabilities 
could be material to the financial statements.

Future commitments in connection with employment agreements 
executed during 1997 with officers of the Company follows:  

December 31
    1998            $  295,000
    1999               250,000
    2000               235,000
    2001               195,000
    2002               175,000
Thereafter              58,333
                    $1,208,333

15.  Subsequent Events
In March 1998 the Company executed an agreement whereby the 
Company sold a 50% working interest and a 40% net revenue 
interest in various leases for $40,000.  Further, the 
purchaser agreed to share in future costs of drilling and 
extracting oil and gas from various leased property 
specified in the agreement. 

In February 1998, the Company purchased 100% of the 
outstanding shares of Triple J Resources Pty. Ltd. (JJJ), 
for $100,000 and 1,500,000 shares of restricted,  
unregistered common stock.  JJJ was purchased from a company 
controlled by the previous owner of SCI (see notes 1 and 4).  
JJJ had no assets or liabilities at the date of the 
transaction.  However, JJJ holds the rights to prospect a 
specific oil and gas concession in Australia.  JJJ has 
executed a "Farmout" agreement whereby 50% working interest 
has been transferred to an unrelated party who will fund and 
perform the work program required by the Australian 
government.

In March 1998, the Company executed various joint venture 
agreements in order to fund the exploration and drilling of 
various oil and gas leases.

In January 1998, the Company issued 400,000 shares of 
restricted, unregistered common stock in exchange for an 
additional 25% of the outstanding stock of Tiger Energy 
Corporation.

In March 1998, the Company issued 2,450,000 share of 
restricted, unregistered, common stock in exchange for 100% 
of the outstanding stock of Rancho El Laurel, S.A. (Rancho) 
a Costa Rican corporation.  The principle asset of Rancho 
is ownership of 5,000 acres of hardwood forest in Costa 
Rica.

CRONUS CORPORATION AND SUBSIDIARIES
SUPPLEMENTARY INFORMATION

CONSOLIDATING BALANCE SHEET
December 31, 1997
ASSETS                                  Petrosun
                                       Exploration Strategic 
                Consolidating  Cronus  Production Consulting
Consolidated    Adjustments  Corporation   Inc.      Inc. 
Current assets:
  Cash and cash equivalents
  $ 1,195                                 $ 1,195
  Other current assets
    3,356                                   3,356
  Accounts receivable
   10,338                                  10,388
  Prepaid consulting fees
  125,000                       125,000
    Total current assets
  139,889                       125,000    14,889

Oil and gas properties, using successful efforts accounting:
  Proved properties
  217,728                                 217,728
  Unproved properties
  121,390                                 121,390
  Wells and related equipment
    5,200                                   5,200
     Total oil and gas properties
  344,318                                 344,318
Less accumulated amortization and depletion
   (1,543)                                 (1,543)
         Net oil and gas properties
  342,775                                 342,775
Other assets:
  Prepaid consulting
   31,250                        31,250
  Deposits
    1,802                         1,802
  Equipment, net
    5,351                         5,351
  Receivable from related corporation
   19,212                                  19,212
  Investment in mining claims
  143,530                       143,530
  Intercompany receivable (payable)
                                301,649  (301,649)
  Investment in PetroSun
                  $ (186,712)   186,712
  Investment in Strategic Consulting
                    (659,952)   659,952
  Goodwill, net
  516,829            516,829
    Total other assets
  717,974           (329,835) 1,330,246  (282,437)
        Total assets
1,200,638           (329,835) 1,455,246    75,277

LIABILITIES AND                         Petrosun
STOCKHOLDERS' EQUITY (DEFICIT)         Exploration Strategic 
                Consolidating  Cronus  Production Consulting
Consolidated    Adjustments  Corporation   Inc.      Inc. 
Current liabilities:
  Drilling advance
 $  26,300                               $  26,300
  Bank overdraft
     4,518                        4,518
  Accrued payroll and related taxes
   392,162                      391,142      1,020		
  Accounts payable
   171,347                       15,555    155,792
  Revenue distribution
     4,536                                   4,536
  Accrued interest
     4,356                        4,356
  Other current liabilities
   439,976                      439,976				
  Notes payable to officers and shareholders
    80,129                       23,729     56,400
  Notes payable-other, net of noncurrent portion
   146,243                      116,243     30,000
      Total current liabilities
 1,269,567                      995,519    274,048
  Notes payable-other, noncurrent
    16,000                       16,000
  Investment in joint venture
    40,508                                  40,508
         Total liabilities
 1,326,075                    1,011,519    314,556

Stockholders' equity:
  Common stock
    15,284     $ (2,000)         15,284      2,000
  Additional paid in capital
 1,801,826      (20,382)      1,801,826     20,382
  Receivable from sale of common stock
  (175,981)                    (175,981)
  Accumulated deficit
(1,766,316)    (307,453)     (1,197,152)  (261,711)
  Less 250,000 shares in treasury, at cost
      (250)                        (250)      -
    Total stockholders' equity (deficit)
  (125,437)    (329,835)        443,727   (239,329)
Total liabilities and stockholders' equity (deficit)
$ 1,200,638  $ (329,835)    $ 1,455,246   $ 75,227


CONSOLIDATING STATEMENT OF OPERATIONS
For the year ended December 31, 1997
                                        Petrosun
                                       Exploration Strategic 
                Consolidating  Cronus  Production Consulting
Consolidated    Adjustments  Corporation   Inc.      Inc. 
Revenues:
  Oil and gas sales
    $ 10,193                               $ 10,193
  Other income
       2,000                                  2,000
    Total income
      12,193                               $ 12,193 

Operating expenses:
  Lease operation and exploration
      63,953                                 63,953
  Salaries and related taxes
     272,440                      272,440
  Professional fees
     151,932                      151,932
  Depreciation and depletion
       3,511                        1,968     1,543
  Other general and administrative
      56,365                       33,431    22,934
    Total operating expenses
     548,201                      459,771    88,430

Loss from operations
    (536,008)                    (459,771)  (76,237)
					
Loss from operations
    (536,008)                    (459,771)  (76,237)
Other expenses:
  Equity in loss of subsidiary
                $ (77,259)         77,259
  Interest expense
       5,377                        4,355     1,022
  Valuation of goodwill
     439,952      439,952
  Amortization of goodwill
     129,207      129,207
    Total other expenses 
     574,536      491,900          81,614     1,022 

Net loss before taxes and extraordinary item
  (1,110,544)    (491,900)       (541,385)  (77,259)
Income tax provision
          50                           50 				

Loss before extraordinary item
  (1,110,594)    (491,900)       (541,435)  (77,259)

Extraordinary item
   2,930,134                    2,930,134

Net income (loss)
 $ 1,819,540   $ (491,900)    $ 2,388,699 $ (77,259)


CRONUS CORPORATION AND SUBSIDIARIES
UNAUDITED SUPPLEMENTARY INFORMATION
____________

CRONUS CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL RESERVE INFORMATION (Unaduited)
For the year ended December 31, 1997 

Capitalized Costs Relating to Oil and Gas Producing 
Activities at December 31, 1997

Unproved oil and gas properties          $ 121,390
Proved oil and gas properties              217,728
Support equipment and facilities             5,200
                                           344,318
Less accumulated depreciation and depletion (1,543)
Net capitalized costs                    $ 342,775

Costs Incurred in Oil and Gas Producing Activities for the 
Year Ended December 31, 1997

Property acquisition costs
    Proved                               $ 217,728
    Unproved                               118,786
    Exploration                              1,572
                                         $ 338,086

Results of Operations for Oil and Gas Producing Activities 
for the Year Ended December 31, 1997

Oil and gas sales                         $ 10,193
Production costs                           (62,381)
Depreciation and depletion                  (3,511)
Exploration                                 (1,572)

Results of operations for oil and gas Producing
  activities (excluding corporate overhead)                      
                                         $ (57,271)

Reserve Information
The following estimates of proved and proved developed 
reserve quantities and related standardized measure of 
discounted net cash flow are estimates only, and do not 
purport to reflect realizable values or fair market values 
of the Company's reserves.  The Company emphasizes that 
reserve estimates are inherently imprecise and that  
estimates of new discoveries are more imprecise than those 
of producing oil and gas properties.  Accordingly, these 
estimates are expected to change as future information 
becomes available.  All of the Company's reserves are 
located in the United States.

Proved reserves are estimated reserves of crude oil 
(including condensate and natural gas liquids) and natural 
gas that geological and engineering data demonstrate with 
reasonable certainty to be recoverable in future years from 
known reservoirs under existing economic and operating 
conditions.  Proved developed reserves are those expected  
to be recovered through existing wells, equipment, and 
operating methods. 

The standardized measure of discounted future net cash flows 
is computed by applying year-end prices of oil and gas (with 
consideration of price changes only to the extent provided 
by contractual arrangements) to the estimated future 
production of proved and developed oil and gas reserves, 
less estimated future expenditures (based on year-end costs) 
to be incurred in developing and producing the proved 
reserves, less estimated future income tax expenses 
(based on year-end statutory tax rates, with consideration 
of future tax rates already legislated) to be incurred on 
pretax net cash flows less tax basis of the properties and 
available credits, and assuming continuation of existing 
economic conditions.  The estimated future net cash flows 
are then discounted using a rate of 10 percent a year to 
reflect the estimated timing of the future cash flows.
        
                                      Oil             Gas
                                     (Bbls)          (Mcf)	
Proved developed and undeveloped reserves
  Beginning                            -0-            -0-
  Purchase                         1,126,510    25,133,272
  Production                            (211)       (6,236)
  End of year                      1,126,299    25,127,036

Proved developed reserves
  Beginning of year                    -0-            -0-
  End of year                        173,886     2,868,764

Standardized measure of discounted future net cash flows at
 December 31, 1997
    Future cash inflows                $    9,397,254
    Future production costs                  (469,803)
    Future income tax expense              (2,142,574)
                                            6,784,877
10% annual discount for estimated timing of cash flows
                                           (4,278,175)
Standardized measures of discounted future net cash flows 
relating to proved oil and gas reserves   $ 2,506,702


     EXHIBITS.

1.  The Company's Articles of Incorporation, as amended.
2.  The Company's By-Laws, incorporated by reference from 
the 1995 10-KSB filed on April 15, 1997.
3.  The Company's Executive long-term Stock Investment Plan, 
incorporated by reference from the Proxy Statement filed on 
January 15, 1998.
4.  Employment Contract of Jonathan Roberts.
5.  Employment Contract of Kevin Sherlock.
6.  Reorganization agreement with PetroSun Exploration & 
Production, Incorporated, incorporated by reference from the 
Form 8-K filed on June 16, 1997.
8.  Employment Contract of Gordon M. LeBlanc, Jr., 
incorporated by reference from the Form 8-K filed on June 
16, 1997.
9.  Consulting Contract with George Hennessey, incorporated 
by reference from the 1996 10-KSB filed on October 15, 1997.
10.  Contract for the sale of gas products to Louisiana 
Intrastate Gas.
11.  List of subsidiaries.
12.  Consent of Auditors.


Exhibit 1.  The Company's Articles of Incorporation, as 
amended.

ARTICLES OF INCORPORATION

OF

CRONUS CORPORATION

AS AMENDED

*    *    *    *
 
We, the undersigned, have voluntarily associated ourselves 
together for the purpose of forming a corporation under the 
laws of the State of Nevada relating to private 
corporations, and to that end do hereby adopt articles of 
incorporation as follows:

ARTICLE ONE.  [Name].  The name of the corporation is:

     Cronus Corporation

ARTICLE TWO.  [Location].  The address of the corporation's 
principal office is Suite 1400 First National Bank Building, 
One East First Street, in the city of Reno, County of 
Washoe, State of Nevada.  The initial agent for service of 
process at that address is Nevada Agency and Trust Company.

ARTICLE THREE.  [Purposes].  The purposes for which the 
corporation is organized are to engage in any activity or 
business not in conflict with the laws of the State of 
Nevada or of the United States of America, and without 
limiting the generality of the foregoing, specifically:

I.  [Omnibus].  To have and to exercise all of the powers 
now or hereafter conferred by the laws of the State of 
Nevada upon corporations organized pursuant to the laws 
under which the corporation is organized and any and 
all acts amendatory thereof and supplemental thereto.
 
II.  [Develop, Manufacture And Sell].  To carry on the 
business of developing, manufacturing and selling resin 
glaze and polish, and formulating glazes and polishes of 
every form and description.
 
III.  [Real Property].  To purchase, or in any way acquire 
for investment or for sale or otherwise, lands, contracts, 
for the purchases or sale of lands, buildings, improvements, 
and any other real property of any kind or any interest 
therein, and as the consideration for same to pay cash or to 
issue the capital stock, debenture bonds, mortgage bonds, or 
other obligations of the corporation, and to sell, convey, 
lease, mortgage, deed of trust, turn to account, or 
otherwise deal with all or any part of the property of the 
corporation; to make and obtain loans upon real estate, 
improved or unimproved, and upon personal property, giving 
or taking evidences of indebtedness and securing the payment 
thereof by mortgage, trust deed, pledge or otherwise; and to 
enter into contracts to buy or sell any property, real or 
personal; to buy or sell mortgages, trust deeds, contracts, 
and evidences of indebtedness;  to purchase or otherwise 
acquire, for the purpose of holding or disposing of the 
same, real or personal property of every kind and 
description, including the good will, stock, rights, and 
property of any person, firm, association, or corporation; 
and to draw, make, accept, endorse, discount, execute and 
issue promissory notes, bills of exchange, warrants, 
bonds, debentures and other negotiable or transferable 
instruments, or obligations of the corporation, from time to 
time, for any of the objects or purposes of the corporation 
without restriction or limit as to amount.
   
IV.  [Carrying On Business Outside State].  To conduct and 
carry on its business or any branch thereof in any state or 
territory of the United States or in any foreign country 
 in conformity with the laws of such state, territory, or 
foreign country, and to have and maintain in any state, 
territory, or foreign country a business office, plant, 
store or other facility.
 
V.  [Purposes To Be Construed As Powers].  The purposes 
specified herein shall be construed both as purposes and 
powers and shall be in no wise limited or restricted by 
reference to, or inference from, the terms of any other 
clause in this or any other article, but the purposes and 
powers specified in each of the clauses herein shall be 
regarded as independent purposes and powers, and the 
enumeration of specific purposes and powers shall not be 
construed to limit or restrict in any manner the meaning of 
general terms or of the general powers of the corporation; 
nor shall the expression of one thing be deemed to exclude 
another, although it be of like nature not expressed.

ARTICLE FOUR.  [Capital Stock].  The corporation shall have 
authority to issue an aggregate of 40,000,000 shares of 
capital stock having a par value of $0.001 per share.

The holders of shares of capital stock of the corporation 
shall not be entitled to preemptive or preferential rights 
to subscribe to any unissued stock or any other securities 
which the corporation may now or hereafter be authorized to 
issue.

The corporation's capital stock may be issued and sold from 
time to time for such consideration as may be fixed by the 
Board of Directors, provided that the consideration so fixed 
is not less than par value.

The stockholders shall possess cumulative voting rights at 
all shareholders' meetings called for the purpose of 
electing a Board of Directors.

ARTICLE FIVE.  [Directors].  The affairs of the corporation 
shall be governed by a Board of Directors of three (3) or 
more persons.  All decisions of the Board must have majority 
consent of the Directors.  The names and addresses of the 
members of the first Board of Directors are:

NAME AND ADDRESS                   TITLE
Thomas J. Neavitt                  President
2207 Crestview Circle
Brea, CA  92621

Franklin C. Cook                   Vice-President
2390 Lorain Road
San Marino, CA  91108

Jack A. Birnbaum                   Vice-President
2226 Shadetree Circle
Brea, CA  92621

Robert L. Meester                  Director
1831 Calle Don Guillermo
La Habra, CA  90631

R.  Wright                         Director
8440 Fountain Ave., #105
Los Angeles, CA  90069

Gene Keefner                       Director
2674 Dawson Avenue
Signal Hill, CA  90806

William Buck                       Director
937 N. Miller Drive
Tucson, Arizona  85710

ARTICLE SIX.  [Incorporators].  The name and address of each 
incorporator of the company is as follows:

    NAME                          ADDRESS

Thomas J. Neavitt             2207 Crestview Circle
                              Brea, CA  92621

Franklin C. Cook              2390 Lorain Road
                              San Marino, CA  91108

Jack A. Birnbaum              2226 Shadetree Circle
                              Brea, CA  92621

ARTICLE SEVEN.  [Period of Existence].  The period of 
existence of the corporation shall be perpetual.

ARTICLE EIGHT.  [Assessment of Stock].  The capital stock of 
the corporation, after the amount of the subscription price 
or par value has been paid in, shall not be subject to pay 
debts of the corporation, and no paid up stock and no stock 
issued as fully paid up shall be assessable or assessed.

ARTICLE NINE.  [By-Laws].  The initial By-Laws of the 
corporation shall be adopted by its Board of Directors.  The 
power to alter, amend or repeal the By-Laws, or to adopt new 
By-Laws, shall be vested in the Board of Directors, except 
as otherwise may be specifically provided in the By-Laws.

ARTICLE TEN.  [Stockholders' Meetings].  Meetings of 
stockholders shall be held at such place within or without 
the State of Nevada as may be provided by the By-Laws of the 
corporation.  Special meetings of the stockholders may be 
called by the President or any other executive office of the 
corporation, the Board of Directors, or any member thereof, 
or by the record holder or holders of at least ten percent 
(10%) of all shares entitled to vote at the meeting.  Any 
action otherwise required to be taken at a meeting of the 
stockholders, except election of directors, may be taken 
without a meeting if a consent in writing, setting forth the 
action so taken, shall be signed by stockholders having at 
least a majority of the voting power.

ARTICLE ELEVEN.  [Contracts of Corporation].  No contract or 
other transaction between the corporation and any other 
corporation, whether or not a majority of the shares of the 
capital stock of such other corporation is owned by this 
corporation, and no act of this corporation shall in any way 
be affected or invalidated by the fact that any of the 
directors of this corporation are pecuniarily or otherwise 
interested in, or are directors or officers of such other 
corporation.  Any director of this corporation, ndividually, 
or any firm of which such director may be a member, may be a 
party to, or any be pecuniarily or otherwise interested in 
any contract or transaction of the corporation; provided, 
however, that the fact that he or such firm is so interested 
shall be disclosed or shall have been known to the Board of 
Directors of this corporation, or a majority thereof; 
and any director of this corporation who is also a director 
or officer of such other corporation, or who is so 
interested, may be counted in determining the existence of a 
quorum at any meeting of the Board of Directors of this 
corporation that shall authorize such contract or  
transaction, with like force and effect as if he were not so 
interested.

ARTICLE TWELVE.  [Indemnification].  The Corporation shall 
indemnify any person who incurs expenses or liabilities by 
reason of the fact that he or she is or was an officer, 
director or employee of the Corporation or is or was serving 
at the request of the Corporation as a director, officer or 
employee of another corporation, partnership, joint venture, 
trust or other enterprise.  This indemnification shall be 
mandatory in all circumstances in which indemnification 
is permitted by law.

ARTICLE THIRTEEN.  [Limitation of Liability].  To the 
fullest extent permitted by Law, as it exists or may 
hereinafter be amended, a director of the Corporation 
shall not be liable to the Corporation or its stockholders 
for monetary damages for any action taken or any failure to 
take any action as a director.  No repeal, amendment or 
modification of this article, whether direct or indirect, 
shall eliminate or reduce its effect with respect to any act 
or omission of a director of the Corporation occurring prior 
to such repeal, amendment or modification.

IN WITNESS WHEREOF, the undersigned incorporators have 
hereunto fixed their signatures at Orange, California, this 
8th day of August, 1979.

/s/
Thomas J Neavitt

/s/
Franklin C. Cook

/s/
Jack A. Birnbaum


Exhibit 4.  Employment Contract of Jonathan Roberts.

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT ("Agreement") is entered into and 
dated for reference purposes as of May 15, 1997, by and 
between Cronus Corporation, a Nevada corporation having a 
principal place of business at 7660 E. Broadway, Suite 210, 
Tucson, Arizona (hereinafter referred to as the "Company"), 
and Jonathan Roberts, an individual residing at 660 S. 
Freeman Road, Tucson, Arizona (hereinafter referred to as 
"Employee").  Company and Employee are sometime collectively 
referred to as "the Parties".

RECITALS

A.  WHEREAS, the Company desires to employ Employee and 
Employee desires to work for the Company in the capacity and 
on the terms and conditions hereinafter provided.

B.  WHEREAS, Employee will be one of the key personnel of 
the Company with the primary responsibility for the 
management and administration of all phases of the 
operations of Cronus Corporation.

NOW, THEREFORE, in consideration of the mutual covenants and 
promises herein, the Parties hereto agree as follows:

AGREEMENT

1.  EMPLOYMENT

1.1  Office and Duties.  The Company agrees to employ 
Employee and Employee agrees to work for the Company in the 
capacity of President of Cronus Corporation.  Employee shall 
have those duties as are normally associated with his office 
and such other duties pertaining to such office as may 
from time to time be assigned to him.  While employed 
hereunder, Employee shall devote his time, effort, skill and 
attention to the affairs of Cronus, and shall faithfully and 
diligently promote the business and interest of Cronus.  
Employee may make personal investments in business entities 
or purchase shares of stock traded upon a recognized U.S. 
securities exchange, provided that such investments or 
purchases are not in companies which compete, directly or 
indirectly, with Cronus, and do not otherwise interfere or 
conflict with Employee's performance of this Agreement.

Employee shall not, without the prior written consent of the 
Company, directly or indirectly, during the term of this 
Agreement, engage in any business activity, directly or 
indirectly, competitive with or adverse to the Company's 
business or interests, whether alone, as a partner, or as an 
officer, director, employee or shareholder of any other 
corporation, or otherwise.

1.2  Term.  The term of employment hereunder commences as of 
the date written above and shall continue for 6 years, 
unless sooner terminated in accordance with the provisions 
hereof.

1.3  Location.  The duties which Employee shall be required 
to perform under this Agreement shall be structured such 
that he can perform said duties in Tucson, Arizona.  
Employee shall not be required to relocate from Tucson, 
Arizona, without his consent.

2.  COMPENSATION.

2.1  Base Salary.  The Company shall continue to pay 
Employee during the term of his employment hereunder a base 
salary of $175,000 per annum.  Employee may receive annual 
increases and bonuses based on performance, at the 
discretion of the Board of Directors.  The base salary 
shall be due and payable in equal bi-weekly installments.  
The Company acknowledges that it owes Employee approximately 
$262,083 in deferred compensation to date.  Employee agrees 
to continue to defer $100,000 of annual salary until company 
is, in the opinion of the Board of Directors, generating 
sufficient income, or until December 1, 1997, whichever 
occurs first.  Additionally, Employee will be granted a 1.0% 
over-riding royalty interest (ORRI) covering all oil and gas 
leaseholds, owned, operated and/or managed by Cronus or any 
subsidiary, which may be converted to a carried working 
interest at the employee's option.

2.2  Employment Benefits.

(a)  Employee shall be entitled to receive or to participate 
in such disability, life, accidental death and dismemberment 
and other similar plans as shall be generally available to 
salaried employees of the Company.  Employee's participation 
in such plans will be in accordance with and subject to the 
terms and provisions of the plans.

(b)  Employee shall receive reimbursements of business 
expenses and other perquisites in accordance with and 
subject to Company policy.

(c)  Employee shall receive four weeks of vacation time per 
year plus one additional week for every three years of 
service under this contract.

2.3   Bonus.  Employee shall be entitled to participate in 
any incentive compensation plan hereafter adopted by the 
Company.

3.  EXPENSES AND PRIOR AGREEMENTS

3.1  Reimbursement of Expenses.  During the term of this 
agreement, the Company shall reimburse Employee for all 
reasonable and necessary expenses related to the performance 
of the Employee's duties under this agreement, upon 
submission of detailed vouchers thereof in accordance with 
the Company's standard practices.  The Company agrees to 
indemnify Employee for the use of Employee's credit in 
obtaining goods and services for the Company, including 
but not limited to any use of Employee as a guarantor for 
the rental of office space and for the initial establishment 
of a corporate credit card.

3.2  Upon execution of this agreement, the employment 
agreement dated November 15, 1995 between Diversified 
American Industries Inc. (a prior name of the Company) and 
employee will be terminated and have no further effect with 
the exception of any options for shares of the Company's 
stock, which options shall continue in full effect.

4.  TERMINATION

4.1  Termination of Employment.  The employment of Employee 
shall terminate prior to the expiration of the term 
specified in Section 1.2 upon the occurrence of any of the 
following events:

(a)  The death of Employee.

(b)  Employee's disability pursuant to Section 4.2.

(c)  Company's termination for cause of Employee pursuant to 
Section 4.3.

(d)  Employee's resignation from his employment with 
Company.

4.2  Disability.  If, by reason of any physical or mental 
disability, Employee is unable to satisfactorily perform his 
duties under this Agreement for six consecutive months, or 
six months in any single calendar year, his services 
hereunder may be terminated by the Company upon two months' 
notice ("Notice Period") to be given to Employee at any time 
after the period of six continuous months of disability and 
while such disability continues.  If, prior to the 
expiration of the Notice Period, Employee recovers from his 
prior disability and returns to the active discharge of his 
duties, the Notice Period shall be deemed canceled and 
Employee's employment shall continue as if the same had 
been uninterrupted.  If Employee does not so recover from 
his disability and return to his duties, then his employment 
shall terminate at the expiration date of the Notice Period.  
During the period of Employee's disability and until the 
expiration date of the Notice Period, Employee shall 
continue to earn all compensation provided in Section 2 
hereof as if he had not been disabled.  In the event a 
dispute arises between Employee and the Company concerning 
Employee's physical or mental ability to continue or return 
to the performance of his duties as President of Cronus, 
Employee agrees to submit himself to examination by a 
competent physician mutually agreeable to both parties, and 
such physician's opinion on Employee's ability to perform 
the duties of President will be final and binding.  
Physician means a medical doctor licensed to practice in the 
state of Arizona.

4.3  Termination For Cause.  Employee may be terminated for 
cause only by reason of one or more of the following 
occurrences:

(a)  Employee's conviction, by a court of competent 
jurisdiction, of any crime (other than minor civil offenses 
such as traffic infractions), whether or not committed 
during the term or in the course of employment under this 
Agreement;

(b)  Employee's willful misconduct, breach of his fiduciary 
duties to the Company, or commission of an act of fraud 
upon, or an act materially evidencing dishonesty;

(c)  Employee's willful and material failure to observe or 
perform his duties under this Agreement; or

(d)  Employee's habitual neglect of the faithful performance 
of his duties under this Agreement.

If the basis for termination is pursuant to paragraphs 
4.3(c) or (d) above, Employee may be terminated only if he 
has been given at least sixty (60) days notice of the 
alleged failure or neglect and during such period he has 
failed to remedy same.

4.4  Consequences of Termination.

(a)  In the event that Employee's employment under this 
Agreement is terminated for any reason other than that set 
forth at Section 4.1, the Company shall remain obligated to 
pay Employee the compensation set forth in Section 2.1 
hereof for a period of four years.  Provided, however, that 
if Employee owes any debt to the Company, Employee hereby 
authorizes Company to deduct from his bi-weekly paychecks an 
amount equal to the bi-weekly repayment of such debt at the 
time of termination.

(b)  In the event that Employee's employment under this 
Agreement is terminated for any reason set forth at Section 
4.1(c), the Company shall remain obligated to pay Employee 
the compensation set forth in Section 2.1 hereof for a 
period of four years.  Provided, however, that if Employee 
owes any debt to the Company, Employee hereby authorizes 
Company to deduct from his bi-weekly paychecks an amount 
equal to the bi-weekly repayment of such debt at the time 
of termination.

(c)  In the event that Employee's employment hereunder shall 
terminate as a result of Employee's resignation as set forth 
at Section 4.1(d), or Employee's death as set forth at 
Section 4.1(a), Employee's base salary, as identified at 
Section 2.1, shall cease to accrue and be due him after the 
effective date of said resignation.

(d)  In the event that Employee's employment hereunder shall 
terminate pursuant to any of the provisions of this Section 
4, the rights of the Employee under the employee benefit 
plans or other plans referred to in Section 2.2 and 
under any incentive compensation plan adopted pursuant to 
Section 2.3, shall be determined in accordance with the 
terms and provisions of such plans and options.

(e)  In the event Employee's employment terminates, all 
provisions of this Agreement shall remain in effect except 
as otherwise specifically provided in this Section 4.4.

5.  OTHER COVENANTS OF EMPLOYEE

5.1  Employee shall not at any time or in any manner make or 
cause to be made any copies, pictures, duplicates, 
facsimiles or other reproductions, recordings or any 
abstracts or summaries of any reports, studies, memoranda, 
correspondence, manuals, recordings, internal financial 
statements, cost data or business projections, plans or 
other written, printed or otherwise recorded materials of 
any kind whatever belonging to or in the possession of the 
Company or its subsidiaries.  Employee shall have no right, 
title or interest in any such material, and Employee agrees 
that he will not, without the prior written consent of the 
Company, remove any such material from any premises of the 
Company or its subsidiaries and that he will surrender all 
such material to the Company immediately upon the 
termination of his employment or at any time prior thereto 
upon the request of the Company.

5.2  Without the prior written consent of the Company, 
Employee shall not at any time (whether during or after his 
employment with the Company) use for his own benefit, or for 
the benefit of or purposes of any other person, firm, 
partnership, association, corporation or business 
organization, entity or enterprise ("Entity"), or disclose 
(except in the performance of his duties hereunder) in any 
manner to any other Entity, any trade secrets, confidential 
information, data know-how or knowledge (including but not 
limited to, that relating to service techniques, patents, 
software, manufacturing processes, purchasing organizations 
and methods, sales organizations and methods, inventory and 
financial information, market development and expansion 
plans, medical therapies, methodologies and its markets, 
client lists, medical programs and customer and supplier 
identities and relationships) belonging to, or relating 
to the affairs of, the Company or its subsidiaries.

5.3  During the term of this Agreement, Employee shall not 
in any manner induce, attempt to induce or assist others to 
induce or attempt to induce (1) any employee, agent, 
representative or other person associated with the Company 
or any of its subsidiaries to terminate his or her  
association with the Company or such subsidiary, nor in any 
manner prohibited under Arizona law interfere with the 
relationship between the Company or such subsidiary and 
any such persons, or (2) any customer or supplier of the 
Company or any of its subsidiaries to terminate its or his 
or her association with the Company or such subsidiary, or 
do anything to interfere, as prohibited under Arizona law, 
with the relationship between the Company or such subsidiary 
and any customer or supplier.

5.4  Employee acknowledges and agrees that the Company's 
remedy at law for any breach of any Employee's obligations 
under any of Sections 4.1 through 4.4 would be inadequate, 
and agrees and consents that temporary and permanent 
injunctive relief may be granted in any proceeding that may 
be brought to enforce any provision of such sections, 
without the necessity of proof of actual damage.  It is the 
intent of the Employee and the Company that the provisions 
of Section 4.1 and 4.4 be given the fullest effect 
consistent with applicable law, and that they survive the 
termination of this Agreement.

6.  GENERAL PROVISIONS

6.1  Representations and Warranties.

(a)  Employee represents and warrants to the Company that 
(1) he is free to accept employment hereunder; (2) he has no 
prior or other obligations or commitments of any kind to 
anyone that would hinder or interfere with his acceptance 
of, or the exercise of his best efforts, as an employee of 
the Company and to perform his duties as President of Cronus 
Corporation; and (3) when executed and delivered, this 
Agreement will constitute his legal and binding obligation.

6.2  Entire Agreement/Amendments.  This Agreement sets forth 
the entire agreement and understanding of the parties 
concerning the subject matter hereof and supersedes all 
prior agreements, arrangements and understandings between 
Employee and the Company concerning the subject matter.  
This Agreement may not be amended or modified except by a 
written document specifically referring to this Agreement 
and executed by the parties hereto.

6.3  Notices.

(a)  Any notices or other communication required or 
permitted to be given hereunder shall be in writing and may 
either be delivered personally to the addressee or be 
mailed, first class, postage prepaid and shall be deemed 
given when so delivered personally, or if mailed, 5 days 
after the time of mailing, or if by facsimile, then one 
business day after the sending of the facsimile, as follows:
If to the Company:

Cronus Corporation
7660 E. Broadway, Suite 210
Tucson, Arizona  85710

If to the Employee:

Jonathan Roberts
660 S. Freeman Road
Tucson, Arizona  85748

(b)  In the event that a dispute arises between the parties 
with respect to this Agreement and litigation results, 
service of process is sufficient if made pursuant to the 
provisions of this Section 6.3.

(c)  Either party may change the address to which any such 
notices or communications are to be delivered to it by 
giving written notice to the other party in the manner 
provided in Section 6.3(a) hereof.

6.4  Assignments;  Binding Effect.

(a)  Employee acknowledges that the services to be rendered 
by him are unique and personal.  Accordingly, Employee may 
not assign any of his rights or delegate any of his duties 
or obligations under this Agreement.  This Agreement shall 
be binding upon and, to the extent herein permitted, shall 
inure to the benefit of Employee's heirs, legatees and legal 
representatives.

(b)  The Company may assign this Agreement or its rights 
hereunder; provided, however, such an assignment shall not 
relieve the Company of any of its obligations herein.  This 
Agreement shall be binding upon and, to the extent herein 
permitted, shall inure to the benefit of the Company's 
successors and assigns.

6.5  Waivers.  The failure of either party hereto at any 
time, or from time to time, to require performance of any of 
the other party's obligations under this Agreement shall in 
no manner affect the right to enforce any provision of this 
Agreement at a subsequent time, and the waiver of any rights 
arising out of any breach shall not be construed as a waiver 
of any rights arising out of any subsequent breach.

6.6  Severability.  The parties intend that this Agreement 
be enforceable to the extent of its provisions.  The parties 
agree that each provision hereof is a separate and distinct 
agreement and independent of the others, so that if any 
provision hereof is held to be invalid or unenforceable for 
any reason, such invalidity or unenforceability shall not 
affect the validity or enforceability of any other provision 
hereof.

6.7  Applicable Law.  The provisions of this Agreement shall 
be governed and interpreted in accordance with the laws of 
the State of Arizona.

6.8  Venue.  The parties hereby agree that any dispute 
between them regarding this Agreement will be resolved in 
Pima County Superior Court, Tucson, Arizona, and the parties 
hereby consent to the jurisdiction of said court.

IN WITNESS HEREOF, the parties hereto have executed this 
Agreement as of the date first above written. 

EMPLOYEE:                     EMPLOYER:
                              CONUS CORPORATION



_________________              ____________________
Jonathan Roberts              By: Kevin M. Sherlock, 
                              Member, Board of Directors


Exhibit 5.  Employment Contract of Kevin Sherlock.

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT ("Agreement") is entered into and 
dated for reference purposes as of May 1, 1997, by and 
between Cronus Corporation, a Nevada corporation having a 
principal place of business at 7660 E. Broadway, Suite 210, 
Tucson, Arizona (hereinafter referred to as the "Company"), 
and Kevin Sherlock, an individual residing at 43 E. 2nd 
Street, Tucson, Arizona (hereinafter referred to as 
"Employee").  Company and Employee are sometime 
collectively referred to as "the Parties".

RECITALS

A.  WHEREAS, the Company desires to employ Employee and 
Employee desires to work for the Company in the capacity and 
on the terms and conditions hereinafter provided.

B.  WHEREAS, Employee will be one of the key personnel of 
the Company with the primary responsibility of assisting the 
president of the Company and to act as the secretary of 
Cronus Corporation.

NOW, THEREFORE, in consideration of the mutual covenants and 
promises herein, the Parties hereto agree as follows:

AGREEMENT

1.  EMPLOYMENT

1.1  Office and Duties.  The Company agrees to employ 
Employee and Employee agrees to work for the Company in the 
capacity of Secretary of Cronus Corporation.  Employee shall 
have those duties as are normally associated with his office 
and such other duties pertaining to such office as may 
from time to time be assigned to him.  While employed 
hereunder, Employee shall devote his time, effort, skill and 
attention to the affairs of Cronus, and shall faithfully and 
diligently promote the business and interest of Cronus.  
Employee may make personal investments in business entities 
or purchase shares of stock traded upon a recognized U.S. 
securities exchange, provided that such investments or 
purchases are not in companies which compete, directly or 
indirectly, with Cronus, and do not otherwise interfere or 
conflict with Employee's performance of this Agreement.

Employee shall not, without the prior written consent of the 
Company, directly or indirectly, during the term of this 
Agreement, engage in any business activity, directly or 
indirectly, competitive with or adverse to the Company's 
business or interests, whether alone, as a partner, or as an 
officer, director, employee or shareholder of any other 
corporation, or otherwise.

1.2  Term.  The term of employment hereunder commences as of 
the date written above and shall continue for 4 years, 
unless sooner terminated in accordance with the provisions 
hereof.

1.3  Location.  The duties which Employee shall be required 
to perform under this Agreement shall be structured such 
that he can perform said duties in Tucson, Arizona.  
Employee shall not be required to relocate from Tucson, 
Arizona, without his consent.

2.  COMPENSATION.

2.1  Base Salary.  The Company shall pay Employee during the 
term of his employment hereunder a base salary of $60,000 
per annum.  Employee may receive annual increases and 
bonuses based on performance, at the discretion of the Board 
of Directors.  The base salary shall be due and payable in 
equal bi-weekly installments.  The Company acknowledges that 
it owes Employee $8,000 in deferred compensation to date.  
Employee agrees to defer $2,000 of monthly salary until 
company is, in the opinion of the Board of Directors, 
generating sufficient income, or until December 1, 1997, 
whichever occurs first.  Additionally, Employee will be 
granted a 0.5% over-riding royalty interest (ORRI) 
covering all oil and gas leaseholds, owned, operated and/or 
managed by Cronus or any subsidiary, which may be converted 
to a carried working interest at the employee's option.

2.2  Employment Benefits.

(a)  Employee shall be entitled to receive or to participate 
in such disability, life, accidental death and dismemberment 
and other similar plans as shall be generally available to 
salaried employees of the Company.  Employee's 
participation in such plans will be in accordance with and 
subject to the terms and provisions of the plans.

(b)  Employee shall receive reimbursements of business 
expenses and other perquisites in accordance with and 
subject to Company policy.

(c)  Employee shall receive four weeks of vacation time per 
year plus one additional week for every three years of 
service under this contract.

2.3  Bonus.  Employee shall be entitled to participate in 
any incentive compensation plan hereafter adopted by the 
Company.

3.  EXPENSES AND PRIOR AGREEMENTS

3.1  Reimbursement of Expenses.  During the term of this 
agreement, the Company shall reimburse Employee for all 
reasonable and necessary expenses related to the performance 
of the Employee's duties under this agreement, upon 
submission of detailed vouchers thereof in accordance with 
the Company's standard practices.  The Company agrees to 
indemnify Employee for the use of Employee's credit in 
obtaining goods and services for the Company.

3.2  Upon execution of this agreement, the consulting 
agreement dated May 24, 1995 between Company and Employee 
will be terminated and have no further effect.

4.  TERMINATION

4.1  Termination of Employment.  The employment of Employee 
shall terminate prior to the expiration of the term 
specified in Section 1.2 upon the occurrence of any of the 
following events:

(a)  The death of Employee.

(b)  Employee's disability pursuant to Section 4.2.

(c)  Company's termination for cause of Employee pursuant to 
Section 4.3.

(d)  Employee's resignation from his employment with 
Company.

4.2  Disability.  If, by reason of any physical or mental 
disability, Employee is unable to satisfactorily perform his 
duties under this Agreement for six consecutive months, or 
six months in any single calendar year, his services 
hereunder may be terminated by the Company upon two months' 
notice ("Notice Period") to be given to Employee at any time 
after the period of six continuous months of disability and 
while such disability continues.  If, prior to the 
expiration of the Notice Period, Employee recovers from his 
prior disability and returns to the active discharge of his 
duties, the Notice Period shall be deemed canceled 
and Employee's employment shall continue as if the same had 
been uninterrupted.  If Employee does not so recover from 
his disability and return to his duties, then his employment 
shall terminate at the expiration date of the Notice Period.  
During the period of Employee's disability and until the 
expiration date of the Notice Period, Employee shall 
continue to earn all compensation provided in Section 2 
hereof as if he had not been disabled.  In the event a 
dispute arises between Employee and the Company concerning 
Employee's physical or mental ability to continue or return 
to the performance of his duties as President of Cronus, 
Employee agrees to submit himself to examination by a 
competent physician mutually agreeable to both parties, and 
such physician's opinion on Employee's ability to perform 
the duties of President will be final and binding.  
Physician means a medical doctor licensed to practice in the 
state of Arizona.

4.3  Termination For Cause.  Employee may be terminated for 
cause only by reason of one or more of the following 
occurrences:

(a)  Employee's conviction, by a court of competent 
jurisdiction, of any crime (other than minor civil offenses 
such as traffic infractions), whether or not committed 
during the term or in the course of employment under this 
Agreement;

(b)  Employee's willful misconduct, breach of his fiduciary 
duties to the Company, or commission of an act of fraud 
upon, or an act materially evidencing dishonesty;

(c)  Employee's willful and material failure to observe or 
perform his duties under this Agreement; or

(d)  Employee's habitual neglect of the faithful performance 
of his duties under this Agreement.

If the basis for termination is pursuant to paragraphs 
4.3(c) or (d) above, Employee may be terminated only if he 
has been given at least sixty (60) days notice of the 
alleged failure or neglect and during such period he has 
failed to remedy same.

4.4  Consequences of Termination.

(a)  In the event that Employee's employment under this 
Agreement is terminated for any reason other than that set 
forth at Section 4.1, the Company shall remain obligated to 
pay Employee the compensation set forth in Section 2.1 
hereof for a period of four years.  Provided, however, 
that if Employee owes any debt to the Company, Employee 
hereby authorizes Company to deduct from his bi-weekly 
paychecks an amount equal to the bi-weekly repayment of such 
debt at the time of termination.

(b)  In the event that Employee's employment under this 
Agreement is terminated for any reason set forth at Section 
4.1(c), the Company shall remain obligated to pay Employee 
the compensation set forth in Section 2.1 hereof for a 
period of four years.  Provided, however, that if Employee 
owes any debt to the Company, Employee hereby authorizes 
Company to deduct from his bi-weekly paychecks an amount 
equal to the bi-weekly repayment of such debt at the time 
of termination.

(c)  In the event that Employee's employment hereunder shall 
terminate as a result of Employee's resignation as set forth 
at Section 4.1(d), or Employee's death as set forth at 
Section 4.1(a), Employee's base salary, as identified at 
Section 2.1, shall cease to accrue and be due him after the 
effective date of said resignation.

(d)  In the event that Employee's employment hereunder shall 
terminate pursuant to any of the provisions of this Section 
4, the rights of the Employee under the employee benefit 
plans or other plans referred to in Section 2.2 and 
under any incentive compensation plan adopted pursuant to 
Section 2.3, shall be determined in accordance with the 
terms and provisions of such plans and options.

(e)  In the event Employee's employment terminates, all 
provisions of this Agreement shall remain in effect except 
as otherwise specifically provided in this Section 4.4.

5.  OTHER COVENANTS OF EMPLOYEE

5.1  Employee shall not at any time or in any manner make or 
cause to be made any copies, pictures, duplicates, 
facsimiles or other reproductions, recordings or any 
abstracts or summaries of any reports, studies, memoranda, 
correspondence, manuals, recordings, internal financial 
statements, cost data or business projections, plans or 
other written, printed or otherwise recorded materials of 
any kind whatever belonging to or in the possession of the 
Company or its subsidiaries.  Employee shall have no right, 
title or interest in any such material, and Employee agrees 
that he will not, without the prior written consent 
of the Company, remove any such material from any premises 
of the Company or its subsidiaries and that he will 
surrender all such material to the Company immediately upon 
the termination of his employment or at any time prior 
thereto upon the request of the Company.

5.2  Without the prior written consent of the Company, 
Employee shall not at any time (whether during or after his 
employment with the Company) use for his own benefit, or for 
the benefit of or purposes of any other person, firm, 
partnership, association, corporation or business 
organization, entity or enterprise ("Entity"), or disclose 
(except in the performance of his duties hereunder) in any 
manner to any other Entity, any trade secrets, confidential 
information, data know-how or knowledge (including but not 
limited to, that relating to service techniques, patents, 
software, manufacturing processes, purchasing organizations 
and methods, sales organizations and methods, inventory and 
financial information, market development and expansion 
plans, medical therapies, methodologies and its markets, 
client lists, medical programs and customer and supplier 
identities and relationships) belonging to, or relating 
to the affairs of, the Company or its subsidiaries.

5.3  During the term of this Agreement, Employee shall not 
in any manner induce, attempt to induce or assist others to 
induce or attempt to induce (1) any employee, agent, 
representative or other person associated with the Company 
or any of its subsidiaries to terminate his or her 
association with the Company or such subsidiary, nor in any 
manner prohibited under Arizona law interfere with the 
relationship between the Company or such subsidiary and 
any such persons, or (2) any customer or supplier of the 
Company or any of its subsidiaries to terminate its or his 
or her association with the Company or such subsidiary, or 
do anything to interfere, as prohibited under Arizona law, 
with the relationship between the Company or such subsidiary 
and any customer or supplier.

5.4  Employee acknowledges and agrees that the Company's 
remedy at law for any breach of any Employee's obligations 
under any of Sections 4.1 through 4.4 would be inadequate, 
and agrees and consents that temporary and permanent 
injunctive relief may be granted in any proceeding 
that may be brought to enforce any provision of such 
sections, without the necessity of proof of actual damage.  
It is the intent of the Employee and the Company that the 
provisions of Section 4.1 and 4.4 be given the fullest 
effect consistent with applicable law, and that they survive 
the termination of this Agreement.

6.  GENERAL PROVISIONS

6.1  Representations and Warranties.

(a)  Employee represents and warrants to the Company that 
(1) he is free to accept employment hereunder; (2) he has no 
prior or other obligations or commitments of any kind to 
anyone that would hinder or interfere with his acceptance 
of, or the exercise of his best efforts, as an employee of 
the Company and to perform his duties as Secretary of Cronus 
Corporation; and (3) when executed and delivered, this 
Agreement will constitute his legal and binding obligation.

6.2  Entire Agreement/Amendments.  This Agreement sets forth 
the entire agreement and understanding of the parties 
concerning the subject matter hereof and supersedes all 
prior agreements, arrangements and understandings 
between Employee and the Company concerning the subject 
matter.  This Agreement may not be amended or modified 
except by a written document specifically referring to this 
Agreement and executed by the parties hereto.

6.3	Notices.
(a)  Any notices or other communication required or 
permitted to be given hereunder shall be in writing and may 
either be delivered personally to the addressee or be 
mailed, first class, postage prepaid and shall be deemed 
given when so delivered personally, or if mailed, 5 days 
after the time of mailing, or if by facsimile, then one 
business day after the sending of the facsimile, as follows:
If to the Company:

Cronus Corporation
7660 E. Broadway, Suite 210
Tucson, Arizona  85710

If to the Employee:

Kevin Sherlock
43 E. 2nd Street
Tucson, Arizona  85705

(b)  In the event that a dispute arises between the parties 
with respect to this Agreement and litigation results, 
service of process is sufficient if made pursuant to the 
provisions of this Section 6.3.

(c)  Either party may change the address to which any such 
notices or communications are to be delivered to it by 
giving written notice to the other party in the manner 
provided in Section 6.3(a) hereof.

6.4  Assignments; Binding Effect.

(a)  Employee acknowledges that the services to be rendered 
by him are unique and personal.  Accordingly, Employee may 
not assign any of his rights or delegate any of his duties 
or obligations under this Agreement.  This Agreement shall 
be binding upon and, to the extent herein permitted, shall 
inure to the benefit of Employee's heirs, legatees and legal 
representatives.

(b)  The Company may assign this Agreement or its rights 
hereunder; provided, however, such an assignment shall not 
relieve the Company of any of its obligations herein.  This 
Agreement shall be binding upon and, to the extent herein 
permitted, shall inure to the benefit of the Company's 
successors and assigns.

6.5  Waivers.  The failure of either party hereto at any 
time, or from time to time, to require performance of any of 
the other party's obligations under this Agreement shall in 
no manner affect the right to enforce any provision of this 
Agreement at a subsequent time, and the waiver of any rights 
arising out of any breach shall not be construed as a waiver 
of any rights arising out of any subsequent breach.

6.6  Severability.  The parties intend that this Agreement 
be enforceable to the extent of its provisions.  The parties 
agree that each provision hereof is a separate and distinct 
agreement and independent of the others, so that if any 
provision hereof is held to be invalid or unenforceable for 
any reason, such invalidity or unenforceability shall not 
affect the validity or enforceability of any other provision 
hereof.

6.7  Applicable Law.  The provisions of this Agreement shall 
be governed and interpreted in accordance with the laws of 
the State of Arizona.

6.8  Venue.  The parties hereby agree that any dispute 
between them regarding this Agreement will be resolved in 
Pima County Superior Court, Tucson, Arizona, and the parties 
hereby consent to the jurisdiction of said court.

IN WITNESS HEREOF, the parties hereto have executed this 
Agreement as of the date first above written. 

EMPLOYEE:                          EMPLOYER:
                                   CRONUS CORPORATION



______________                     _____________________
Kevin Sherlock                     By: Jonathan Roberts, 
                                   President, and
                                   Member, Board of
                                   Directors


Exhibit 10.  Contract for the sale of gas products to 
Louisiana Intrastate Gas.

THIS AGREEMENT, effective as of August 6, 1997, by and 
between PETROSUN EXPLORATION AND PRODUCTION, INC., 
hereinafter referred to as "Seller", and LOUISIANA 
INTRASTATE GAS COMPANY L.L.C., hereinafter referred to as 
"Buyer".

WHEREAS, Seller owns oil, gas and mineral leases, or mineral 
servitudes, or fee lands or operating rights therein which 
are or may be productive of gas, and Seller has the right to 
sell such gas for its own account or for the account of 
others, or both;  and

WHEREAS, Seller desires to sell gas to Buyer and Buyer 
desires to purchase such gas from Seller.

NOW, THEREFORE, in consideration of the premises and of the 
mutual covenants herein contained, the parties hereto do 
hereby covenant and agree as follows:

l. Commitment:  Subject to all the terms, conditions and 
limitations herein set forth, Seller agrees to sell and 
deliver or cause to be delivered to Buyer on an "as, if and 
when available basis", and Buyer agrees to purchase and 
receive or cause to be received from Seller on an "as, if 
and when needed basis" during the term hereof all of 
Seller's gas available for sale from Seller's interest from 
various wells located in or near the Lake End Field, Red 
River Parish, Louisiana.  It is understood and agreed that 
delivery is limited to 800 MMBtu per day into LIG's six inch 
(6") Lake End to Hanna pipeline segment.  For volumes of gas 
in excess of 800 MMBtu per day, it is understood and agreed 
that Seller will provide facilities necessary to connect 
Seller's well or wells to a mutually agreeable point or 
points on LIG's eight inch (8") pipeline segment.  It is 
understood and agreed that Seller's commitment is limited to 
the term of the Contract as hereinafter set out and applies 
to Seller's extant rights, titles and interests in the gas 
committed herein.  It is also understood and agreed that 
Seller warrants that the gas committed hereunder is free 
from any commitment made by, through, or under Seller in 
conflict with this Contract for its duration, and without 
limiting the warranty of Seller as to gas delivered as 
provided in the General Terms and Conditions attached hereto 
in Exhibit "A", Seller represents that to the best of its 
knowledge the gas committed hereunder is free from any 
commitment made by, through, or under any other party in 
conflict with this Contract for its duration.

2. Delivery Point:  The point(s) of delivery and measurement 
of gas purchased and sold pursuant to this Contract shall be 
at the inlet side of the metering facilities of Buyer to be 
located on LIG's pipeline in or near Section 20, Township 
11 North, Range 9 West, Red River Parish, Louisiana.  Title 
to and responsibility for all gas shall pass from Seller to 
Buyer at said point(s) of delivery.

3. Delivery Pressure:  The gas shall be delivered by Seller 
at the point(s) of delivery at such pressure as may be 
necessary to effect the delivery of such gas into LIG's 
transmission line against the pressure existing therein from 
time to time, however, LIG's six inch (6") transmission line 
will not exceed 350 pounds per square inch gauge, LIG's 
eight inch (8") transmission line will not exceed 720 pounds 
per square inch gauge;  provided, further, that neither 
Seller nor Buyer shall be obligated to install compression 
equipment for delivery of gas into LIG's pipeline, but 
either Seller or Buyer shall have the right to install such 
compression equipment and operate the same at its own cost 
and expense.

4. Price:  The price shall be per MMBTU on a dry basis, and 
inclusive of all taxes and any other adjustments equal to 
the dollar amount shown in the Natural Gas Week published by 
The Oil Daily Co., Suite 500, 1401 New York Ave., N.W., 
Washington, D.C. 20005 (telephone 800/621-0050) from the 
first week's publication for the month in which the gas is 
delivered under the category Louisiana-Gulf Coast-Onshore-
Intrastate-Wellhead-Spot Bid Week in the table labeled "Gas 
Price Report," less $0.10 provided that if said referenced 
price is no longer published, Seller and Buyer shall 
renegotiate the price payable hereunder as soon as 
practicable, and in default of agreement to a renegotiated 
price either Seller or Buyer may terminate this Contract 
upon thirty (30) days prior written notice, with the price 
last in effect continuing until the date of termination.

5. Meter Administration Fee:  Seller agrees to pay Buyer a 
Meter Administration Fee of six hundred dollars ($600) per 
month per meter, for each and every month during the term of 
this Contract.

6. Term of Contract:  The term of this Contract shall be 
from the date of initial delivery through August 31, 1998, 
and shall continue from month to month until terminated by 
either party with thirty (30) days prior written notice.

7. Facilities:  Seller shall provide the gathering and 
production facilities necessary to connect Seller's well or 
wells with the delivery point(s) above specified.  Seller 
shall install pressure control equipment standard to the 
industry embodying a pressure controller to sense Buyer's 
transmission line pressure which will allow unattended 
operation of said transmission system at varying flow 
conditions.  Buyer shall construct and Buyer shall operate 
or cause to be operated only such measurement station 
facilities as Buyer may find necessary in practice for the 
measurement of the gas purchased hereunder.

8. Addresses:
Invoices/Statements/Payments:
Louisiana Intrastate Gas Company L.L.C 5555 San Felipe, 
Suite 2100, Houston, 
TX 77056, Attn: Gas Accounting

Notices and Correspondence:
Louisiana Intrastate Gas Company L.L.C. 5555 San Felipe, 
Suite 2100, 
Houston, TX 77056, Attn: Gas Supply

Invoices/Statements/Payments:
PetroSun Exploration and Production, Inc. 8129 North 87th 
Place, Scottsdale, 
AZ 85258

Notices and Correspondence:
PetroSun Exploration and Production, Inc. 8129 North 87th 
Place, Scottsdale, 
AZ 85258

9. General Terms and Conditions:  This Contract is subject 
to Louisiana Intrastate Gas Company L.L.C.'s General Terms 
and Conditions applicable to Gas Purchase Contracts, a copy 
of which is attached hereto and made a part hereof as 
Exhibit "A".

If the above accurately reflects our agreement and 
understanding, please execute both originals and return for 
our execution.  One (1) fully executed copy will be returned 
for your file.

ACCEPTED AND AGREED TO THIS 9TH DAY OF AUGUST, 1997.
PETROSUN EXPLORATION AND PRODUCTION, INC.
BY: GORDON M. LEBLANC, JR., PRESIDENT

ACCEPTED AND AGREED TO THIS 21ST DAY OF AUGUST, 1997.
LOUISIANA INTRASTATE GAS COMPANY L.L.C.
BY: ITS PRESIDENT


GENERAL TERMS AND CONDITIONS

APPLICABLE TO

GAS PURCHASE CONTRACT


INDEX

Section    Subject

1.   Definition of Terms
2.   Quality
3.   Metering and Measurement
4.   Billing and Payment
5.   Force Majeure
6.   Default
7.   Warranty
8.   Easements
9.   Miscellaneous

GENERAL TERMS AND CONDITIONS

1. DEFINITION OF TERMS

l.l  The word "day" shall mean a period of twenty-four (24) 
consecutive hours beginning and ending at eight o'clock A.M. 
Local Time.

1.2  The word "month" shall mean a period beginning at eight 
o'clock A.M. on the first day of a calendar month and ending 
at eight o'clock A.M. on the first day of the next 
succeeding calendar month.

1.3  The word "year" shall mean a contract year (rather than 
a calendar year unless the context clearly contemplated a 
calendar year) which shall mean a period of three hundred 
sixty-five (365) consecutive days, the first such contract 
year beginning at eight o'clock A.M. on the day of first 
delivery of gas hereunder, provided however, that any such 
year which contains a date of February 29 shall consist of 
three hundred sixty-six (366) consecutive days.

1.4  The term "Calendar Quarter" shall mean three 
consecutive months commencing each January 1, April 1, July 
1, and October 1.

1.5  The word "gas" shall mean natural gas including both 
gas well gas and casinghead gas of the quality described in 
Paragraph 2 hereof.

1.6  The term "casinghead gas" excludes gas cap gas and 
shall mean gas produced in association with crude petroleum 
from an oil well, all or substantially all of which is 
indigenous to the oil strata from which such crude petroleum 
oil is produced, together with gas lift gas produced with 
oil, whether originally produced from the same oil strata or 
not.

1.7  The term "gas well gas" shall mean all other gases, 
including gas cap gas, or the mixture of hydrocarbon gases 
produced from Seller's leases other than what is included 
within the definition of casinghead gas.

1.8  The term "cubic foot of gas" shall mean the volume of 
gas which would occupy one cubic foot of space when such gas 
is at a temperature of sixty degrees Fahrenheit (60oF) and a 
pressure of 15.025 pounds per square inch absolute. 
Computation of volume shall be made in accordance with the 
provisions of Louisiana R.S. 55:151-156 known as the 
"Standard Gas Measurement Law" of the State of Louisiana.

1.9  The letters "MCF" shall denote one thousand (1,000) 
cubic feet of gas.

1.10  The term "British Thermal Unit" or "BTU" shall mean 
the amount of heat required to raise the temperature of one 
pound of pure water from fifty-eight and five-tenths degrees 
Fahrenheit (58.5oF) to fifty-nine and five-tenths degrees 
Fahrenheit (59.5oF).

l.l1  The term "MMBTU" shall denote one million (1,000,000) 
British thermal units.

1.12  The term "heating value" means the gross number of 
British thermal units produced by the combustion at constant 
pressure, of the amount of gas saturated with water vapor 
which would occupy a volume of one (1) cubic foot at 
a temperature of sixty degrees Fahrenheit (60oF), under a 
pressure equivalent to that of thirty inches (30") of 
mercury at thirty-two degrees Fahrenheit (32oF) and under 
gravitational force (acceleration 980.665 cm. per sec. per 
sec.) with air of the same temperature and pressure as the 
gas, when the products of combustion are cooled to the 
initial temperature of the gas in air, and when the water 
formed by combustion is condensed to the liquid state, 
expressed at a pressure base of 15.025 psia on a dry basis.

1.13  The term "Buyer's transporter" shall mean the party or 
parties, if any, designated by Buyer, to receive and handle 
gas deliverable hereunder for Buyer's account.

2.  QUALITY

2.1  Buyer may, but shall not be obligated to, purchase gas 
delivered hereunder if said gas fails to comply with the 
following quality requirements:

a.  Heating Value: Such gas shall have a total heating 
value, determined as hereinafter provided, of not less than 
nine hundred fifty (950) BTU's per cubic foot.  If the 
heating value of any gas tendered by Seller for delivery 
shall be below nine hundred fifty (950) BTU's per cubic 
foot, Buyer shall have the option to either:

(1)  Accept delivery of such gas.

(2)  Refuse to accept delivery of such gas until Seller 
shall restore the total heating value required for delivery.

If Buyer refuses to accept delivery and Seller is unable or 
fails to restore the total heating value, then upon ninety 
(90) days written notice from Seller of its desire to 
withdraw from this Contract such sources of gas deficient in 
heating value it shall be privileged to do so unless Buyer 
thereupon elects to continue to purchase gas hereunder.

b.  Freedom of Objectionable Matter: The gas to be delivered 
by Seller hereunder:

(1)  Shall be commercially free from dust, gums, water, 
crude oil, impurities and other objectionable substances 
which may become separated from the gas and interfere with 
its transmission through Buyer's pipeline system.

(2)  Shall be commercially free from hydrogen sulfide 
containing not more than one (1) grain of hydrogen sulfide 
per one hundred (100) cubic feet.

(3)  Shall not contain more than twenty (20) grains of total 
sulfur per one hundred (100) cubic feet.

(4)  Shall not contain more than two-tenths of one percent 
(.2 of 1%) of oxygen by volume, nor more than four percent 
(4%) of total inert gases including a maximum of two percent 
(2%) carbon dioxide (CO2).

c.  Dehydration: The gas shall be dehydrated to contain not 
more than seven (7) pounds of water per one million 
(1,000,000) cubic feet of gas.

d.  Delivery Temperature: The gas shall be delivered at a 
temperature not less than forty degrees Fahrenheit (40oF) 
nor greater than one hundred twenty degrees Fahrenheit 
(120oF).

3.  METERING AND MEASUREMENT

3.1  The volume unit of the gas delivered under this 
Contract shall be one thousand (1,000) cubic feet.

3.2  Unit of Volume: The unit of volume, for purposes of 
measurement, shall be one (1) cubic foot of gas at a 
temperature of sixty degrees Fahrenheit (60oF) and at a 
pressure of fifteen and twenty-five thousandths (15.025) 
pounds per square inch absolute, as defined in the 1950 
Standard Gas Measurement Law of the State of Louisiana.

3.3  Measurement Equipment: Buyer shall install, maintain, 
own and operate orifice meters of standard make accepted by 
the industry with flange type connections and chart cycles 
not to exceed eight (8) days, and any other auxiliary 
measuring equipment necessary in order to accomplish 
accurate measurement of the gas to be delivered hereunder; 
such measurement equipment including electronic gas 
measurement devices, to be installed and operated in 
accordance with the American National Standard publication, 
Orifice Metering of Natural Gas ANSI/API 2530 "A.G.A. Report 
No. 3", as amended from time to time, or by any other method 
commonly used in the industry and mutually acceptable.  
Buyer shall be responsible for the calculation of volumes 
received at the delivery point.

Buyer shall give reasonable notice to Seller of the 
scheduling of measurement tests so that Seller may have a 
representative present to observe the test.

3.4  Temperature and Specific Gravity:

a.  The temperature of the gas in Buyer's meters shall be 
determined by Buyer by means of a recording thermometer 
installed at each point of delivery or other mutually 
agreeable method. The arithmetical average of the hourly 
temperatures recorded during periods of flow only during 
each day shall be deemed the gas temperatures, and shall be 
used in computing the volumes of gas delivered hereunder.  
In the absence of a recording thermometer, the temperature 
shall be assumed to be sixty degrees Fahrenheit (60oF).

b.  The specific gravity of the gas shall be determined by 
Buyer at each point of delivery with a density type of gas 
balance or by such other method as shall be agreed upon 
between the parties. If the density type gas balance method 
is used, the specific gravity of the gas delivered shall be 
determined once monthly or as often as is found necessary in 
practice. The regular monthly test shall determine the 
specific gravity at each delivery point to be used in 
computation for the measurement of gas delivered at each 
such delivery point until the next regularly scheduled test 
or until changed by a special test; the special test to be 
applicable from the date made until the next regularly 
scheduled test.

3.5  Determination of Heating Value: The heating value per 
cubic foot of gas shall be determined monthly or as Buyer or 
Seller may deem necessary in practice that the parties 
mutually agree upon. The heating value under the standard of 
Section 1.12 as applied pursuant to this Section shall be 
used to determine the total BTU content of all gas delivered 
hereunder. The gross British thermal unit content per cubic 
foot of gas delivered hereunder shall be determined by Buyer 
by the use of a spot sample taken during such month to be 
analyzed on a gas chromatography; or at Buyer's option, by 
the use of a continuous sampler (of an approved type to be 
analyzed on a gas chromatography), or at Buyer's option, by 
the arithmetical average of the records of a recording 
calorimeter of an approved type which, at Buyer's option, 
may be installed, operated and maintained at the place of 
measurement of the gas, or the BTU value may be determined 
by application of the American Gas Association (AGA) Report 
No. 5 Fuel Gas Energy Metering, using the applicable  
specific gravity and applying the inert value of N2 and CO2 
from an applicable spot or continuous sample. Use of either 
a calorimeter or the AGA Report No. 5 method will result in 
a daily BTU value. The BTU value may be determined by 
such other methods upon which the parties may mutually 
agree. Seller shall be permitted to witness the testing of 
samples.  Monthly billings will be reckoned by multiplying 
the measured volume by the average BTU content per cubic 
foot as shown by the installed calorimeter or as shown by 
the sample tested.  Based upon such determination, 
calculations shall then be made to determine the gross 
British thermal unit content per cubic foot of gas at 14.7 
psia and sixty degrees Fahrenheit (60oF), adjusted to a 
pressure base of 15.025 psia on a dry basis.

3.6  Deviation from Boyle's Law: Appropriate correction 
shall be made for any deviation from Boyle's Law. Correction 
of volumes for deviation from Boyle's Law shall be made in 
accordance with the methods and formulas prescribed in the 
American Gas Association's manual Supercompressibility 
Factors for Natural Gas NX-19 for the determination of 
supercompressibility factors for natural gas as last amended 
and superseded.

3.7  Atmospheric Pressure: For purposes of measurement and 
meter calibration, the atmospheric pressure shall be assumed 
to be constant at fourteen and seven-tenths (14.7) pounds 
per square inch.

3.8  Check Measuring Equipment: Seller may, at its option, 
install and operate check measuring equipment to check the 
accuracy of Buyer's measurements; such equipment to be of 
the same or similar type as that installed by Buyer. 
Seller may install such check measuring equipment on Buyer's 
meter run.  Seller shall install and operate such check 
measuring equipment so that it will not interfere with the 
operation of Buyer's facilities.  Each party shall give 
reasonable notice to the other of tests so that the other 
party may conveniently (but, at its expense), have its 
representative present.  If such notice has been given and 
the other party is not present at the time specified, the 
party giving the notice may proceed as though the other 
party were present.

3.9  Corrections: If upon any such test, Buyer's meter(s) is 
(are) found to be inaccurate:

a.  By less than one percent (1%), previous readings thereof 
shall be considered correct, but such meter shall be 
adjusted at once to read correctly.

b.  By one percent (1%) or more, such meter shall be 
adjusted at once to read correctly and previous readings 
thereof shall be corrected to zero error for the period of 
time during which said meter was known or agreed by the 
parties to be inaccurate, and in the event the extent of 
such period of inaccuracy is not known or agreed upon, then 
such corrections shall be made for a period of one-half 
(1/2) of the elapsed time since the date of the last 
preceding test.  In the event Buyer's meter is out of 
service or registering inaccurately, and the inaccuracy 
cannot be calculated, the volume of gas delivered hereunder 
shall be estimated, (1) by using the registration of any 
check meter or meters, if installed and accurately 
registering, or, in their absence, (2) by correcting the 
error if the percentage of error is ascertainable by 
calibration, test, or mathematical calculation, or, if 
neither such method is feasible, (3) by estimating the 
quantity of delivery by deliveries during a period under 
similar conditions when the meter was registering 
accurately, or (4) by any other method agreed upon.

3.10  Preservation of Charts, etc.: All test data, charts, 
and other similar records shall be preserved by Buyer for a 
period of at least two (2) years and shall, upon the request 
of Seller, be sent to Seller for inspection at any 
reasonable time.  All such test data, charts and any other 
similar records sent to Seller shall be returned to Buyer's 
transporter within thirty (30) days.

4.  BILLING AND PAYMENT

4.1  No later than the twenty-fifth (25th) day of each 
calendar month after deliveries of gas are commenced 
hereunder, or the first working day thereafter, Buyer shall 
render a statement to Seller showing the amount of gas 
delivered during the preceding month, together with a check 
in the amount due therefor and with sufficient information 
to explain and support any adjustments made by Buyer with 
respect to the value of gas delivered in determining the 
amounts stated as due. If Buyer requires an allocation 
statement to determine the actual volumes sold under the 
Contract, or the amount to be paid to Seller for gas sold 
under the Contract, Seller shall be responsible for 
supplying Buyer with a written allocation statement no later 
than the tenth (lOth) day of the month for gas delivered 
hereunder during the preceding month.  Buyer shall be 
entitled to rely on such allocation statement as accurately 
setting forth the information stated therein.  If such 
allocation statement is not received by the tenth (lOth) day 
of such month, then payment may be delayed one day for each 
day past the tenth (lOth) that said allocation statement is 
late.

4.2  Should Buyer fail to pay the full amount due Seller 
when the same is due, as herein provided, interest thereupon 
shall accrue at the rate of twelve percent (12%) per annum 
from the date when such payment is due until the same is 
paid.  If such failure to pay continues for sixty (60) days, 
Seller may suspend deliveries of gas hereunder, but the 
exercise of such right shall be in addition to any and all 
other remedies available to Seller.

4.3  Upon request, Buyer, or Buyer's transporter, shall make 
available to Seller for checking and calculation all volume 
and temperature (and heating value where applicable) charts 
used in the measurement of gas delivered hereunder no 
earlier than twenty (20) days after the last chart for 
each billing period is removed from the meters. Such charts 
shall be returned to Buyer, or Buyer's transporter, within 
thirty (30) days.

4.4  Each party shall have the right at all reasonable times 
to examine the books, records, and charts of the other party 
to the extent necessary to verify the accuracy of any 
statement, charge, computation or demand made under or 
pursuant to any of the provisions of this Contract within 
the previous two (2) years.

5.  FORCE MAJEURE

5.1  In the event of either party hereto being rendered 
unable, wholly or in part, by force majeure to carry out its 
obligations hereunder, it is agreed that on such party's 
giving notice and full particulars of such force majeure in 
writing or by telegraph to the other party as soon as 
practicable after the occurrence of the cause relied on, 
then the obligations of the party giving such notice, so far 
as they are affected by such force majeure, shall be 
suspended during the continuance of any inability so caused, 
but for no longer period, and such cause shall as far as 
possible be remedied with all reasonable dispatch. The 
occurrence of a cause of force majeure shall not excuse the 
payment of money for gas delivered.

5.2  The term "force majeure" as employed herein and for all 
purposes relating hereto shall mean acts of God, strikes, 
lockouts or other industrial disturbances, acts of the 
public enemy, wars, blockades, insurrections, riots, 
epidemics, landslides, lightning, earthquakes, fires, 
storms, hurricane warnings, crevasses, floods, washouts, 
arrests and restraints of governments and people, civil 
disturbances, explosions, breakage or accident to machinery 
or lines of pipe, the necessity for making repairs or 
alterations to machinery or lines of pipe, freezing 
of wells or lines of pipe, partial or entire failure of 
wells, inability of any party hereto to obtain necessary 
materials, supplies or permits due to existing or future 
rules, regulations, orders, laws or proclamations of 
governmental authorities (both Federal and State), including 
both civil and military, and any other causes whether of the 
kind herein enumerated or otherwise, not within the control 
of the party claiming suspension and which by the exercise 
of due diligence such party is unable to prevent or 
overcome; such term shall likewise include (a) in those 
instances where either party, or its transporter, hereto is 
required to obtain servitudes, rights-of way grants, permits 
or licenses to enable such party to acquire, the inability 
of such party to acquire, or the delays on the part of such 
party in acquiring, at reasonable cost and after the 
exercise of reasonable diligence, such servitudes, rights-of 
way grants, permits or licenses, and (b) in those instances 
where either party, or its transporter, hereto is required 
to furnish materials and supplies for the purposes of 
constructing or maintaining facilities, or is required to 
secure permits or permissions from any governmental agency 
to enable such party to fulfill its obligations hereunder, 
the inability of either party to acquire, or the delays on 
the part of such party, or its transporter, in acquiring at 
reasonable cost and after the exercise of reasonable 
diligence, such materials and supplies, permits and  
permissions.

5.3  If the gas covered hereby is to be handled by a third 
party, whether as transporter or under the independent 
contract, before or after delivery to or for the account of 
Buyer, any cause affecting said third party which would be a 
cause of force majeure if directly affecting Buyer or Seller 
shall be excused as force majeure hereunder.

5.4  It is understood and agreed that the settlement of 
strikes or lockouts shall be entirely within the discretion 
of the party having the difficulty, and that the above 
requirements that any force majeure shall be remedied 
with all reasonable dispatch shall not require the 
settlement of strikes or lockouts by acceding to the demands 
of the opposing party when such course is inadvisable 
in the discretion of the party having the difficulty.

6.  DEFAULT

6.1  It is covenanted and agreed that if either party hereto 
shall fail to perform any of the covenants or obligations 
imposed upon it under and by virtue of this Contract, then 
in such event the other party hereto may at its option 
terminate this Contract by proceeding as follows: The party 
not in default shall give written notice to the party in 
default stating specifically the cause or causes for 
terminating this Contract and declaring it to be the 
intention of the party giving the notice to terminate same; 
thereupon the party in default shall have thirty (30) 
days after the giving of the aforesaid notice in which to 
remedy or remove the cause or causes stated in the notice 
for terminating this Contract, and if within said period of 
thirty (30) days the party in default does so remedy or 
remove said cause or causes and fully indemnify the party 
not in default for any and all consequences of such breach, 
then such notice shall be withdrawn and this Contract shall 
continue in full force and effect.  In case the party in 
default does not so remedy or remove the cause or causes and 
indemnify the party giving the notice in any and all 
consequences of such breach, within said period of thirty 
(30) days, then at the option of the party giving the 
notice, this Contract shall become null and void from and 
after the expiration of said period. Any cancellation of 
this Contract pursuant to this provision by Buyer shall be 
without prejudice to the right of Seller to collect any 
amounts then due Seller for natural gas delivered prior to 
the time of cancellation, provided that the same shall be 
taken in accordance with the applicable provisions of this 
Contract for quantities and rate of flow, and without waiver 
of any remedy to which the party not in default may be 
entitled for violations of this Contract.

7.  WARRANTY

7.1  Each Seller to the extent of its interest hereby 
warrants title to all gas delivered hereunder and each such 
Seller warrants that all of its such gas is owned by Seller 
free from all liens and adverse claims including liens to 
secure payment of production taxes, severance taxes and 
other taxes.  Seller shall at all times have the obligation 
to pay all royalties due and payable to the mineral and 
royalty owners under Seller's leases.  Seller agrees to 
indemnify Buyer and save Buyer harmless from all suits, 
actions, debts, accounts, damages, costs, losses and 
expenses arising from or out of adverse claims of any or 
all persons to said gas or to royalties, taxes which Seller 
is obligated to pay hereunder, license fees, or charges 
thereon which are applicable before the title to the gas 
passes to Buyer.  If any Seller's title or right to sell the 
gas committed hereunder is questioned or involved in any 
action, Buyer may withhold payment (without interest) of 
sums due hereunder to such Seller up to the amount of the 
claim until title or right to sell is freed from such 
question or such action is finally determined or until such 
Seller shall have furnished a corporate warranty 
satisfactory to Buyer conditioned to save Buyer harmless 
with respect to such claim.  In no event may Buyer pay any 
adverse claimant without the consent of Seller or an order 
of a court of competent jurisdiction authorizing such 
payment.

8.  EASEMENTS

8.1  To the extent that Seller has the right to do so under 
its leases, Seller hereby grants to Buyer's transporter the 
right to install, maintain and operate on the lands held by 
Seller any and all pipelines, measuring equipment and other 
facilities required to enable Buyer's transporter to take 
delivery of gas under this Contract in accordance with the 
terms thereof.  All such pipelines, measuring equipment and 
other facilities shall be installed so as not to interfere 
with Seller's operations on its leases as of the time such 
pipelines, measuring equipment and other facilities may be 
installed.

9.  MISCELLANEOUS

9.1  Seller shall be responsible for and shall indemnify 
Buyer against all liabilities and claims arising out of the 
handling of gas delivered through Seller's facilities up to 
the point of delivery. Buyer shall be responsible for and 
shall indemnify Seller against all liabilities and claims 
arising out of the receipt and further handling of gas 
delivered hereunder through the facilities of Buyer's 
transporter at the point of delivery thereof and thereafter.

9.2  No waiver by either party of one or more defaults by 
the other in the performance of any of the provisions of 
this Contract shall operate or be construed as a waiver of 
any other or further default or defaults, whether of a like 
or of a different character.

9.3  This Contract shall be binding upon and inure to the 
benefit of the heirs, legal representatives, successors and 
assigns of the respective parties hereto, shall constitute a 
real right and covenant running with the lands and leasehold 
estates covered hereby, and shall be binding upon any 
purchaser of the properties of Seller which are subject to 
this Contract.

9.4  No prohibition against assignment without the consent 
of the other party, or other language of similar import 
elsewhere herein contained, shall prohibit any party to this 
Contract from using this Contract as security for its 
indebtedness or from making any assignment, pledge or 
mortgage in connection therewith or prohibit or limit Buyer 
from assigning this Contract to an affiliate.

9.5  Seller shall not be required or obligated to drill, 
rework or deepen any well and Seller shall not be required 
or obligated to operate any well which in Seller's judgment, 
exercised in good faith, it would be uneconomical for Seller 
to so operate.

9.6  Seller agrees to complete its wells in a workmanlike 
manner and in accordance with the rules, regulations and 
orders of any regulatory body having jurisdiction and to 
keep its wells in good condition.

9.7  Seller agrees at its expense to install and to properly 
maintain and operate at Seller's wells or on Seller's 
gathering lines such drips, separators, dehydrators, or any 
other equipment as may be reasonably necessary to remove 
from the gas delivered hereunder all free water and all 
objectionable solids and all liquid hydrocarbons, distillate 
and condensate capable of being removed from the gas by 
means of wellhead separators generally used in the industry, 
and Seller agrees to so install, maintain and operate such 
heaters and other devices as a reasonably prudent operator 
would deem necessary to prevent the freezing of wells or 
gathering lines and to assure the continuous delivery of gas 
conforming to the quality provisions hereof.

9.8  It is hereby agreed by and between the parties that all 
aspects of the Contract, including interpretation of its 
provisions and any disputes arising hereunder are to be 
governed solely and exclusively by Louisiana Law.

END OF EXHIBIT "A"


Exhibit 11.  List of Subsidiaries.

Sunorc, Inc., a wholly owned subsidiary, incorporated in 
Arizona on December 
5, 1995.

Big Bug Acquisition Company, a wholly owned subsidiary, was 
incorporated in Arizona on August 6, 1996.  Big Bug was then 
merged with PetroSun Exploration & Production, Incorporated 
on July 14, 1997.  The resulting company, which is a wholly 
owned subsidiary, took the name PetroSun Exploration & 
Production, Incorporated. 

Strategic Consulting and Administration, Inc., a wholly 
owned subsidiary, incorporated in Arizona on September 7, 
1990.

Triple "J" Resources Pty., Ltd., a wholly owned subsidiary, 
was incorporated in Queensland, Australia on July 27, 1994.

The Company owns 50% of the outstanding shares of Tiger 
Energy Corporation, which was incorporated in Nevada on July 
25, 1997.

Exhibit 12. Consent of Auditors.

ADDISON, ROBERTS & LUDWIG, P.C.
Certified Public Accountants

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT

We hereby consent to the inclusion of our report dated June 
10, 1998, in the annual report of Cronus Corporation on Form 
10-KSB for the year ended December 31, 1997.

/s/

Addison, Roberts & Ludwig, P.C.
Tucson, Arizona
June 10, 1998

2910 North Swan Road, Suite 204
Tucson, Arizona 85712