UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-Q

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

For the quarterly period ended                    March 31, 2000
                               -------------------------------------------------

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

For the transition period from ________________ to ____________________

Commission file number     1-3793

                         CANADA SOUTHERN PETROLEUM LTD.
 ................................................................................
             (Exact name of registrant as specified in its charter)

     NOVA SCOTIA, CANADA                               98-0085412
 ................................................................................
   (State or other jurisdiction of                  (I.R.S. Employer
   incorporation or organization)                   Identification No.)

   #505, 706 - 7th Avenue, S.W., Calgary, Alberta, Canada        T2P 0Z1
 ................................................................................
      (Address of principal executive offices)                  (Zip Code)

                                 (403) 269-7741
 ................................................................................
              (Registrant's telephone number, including area code)


 ................................................................................
              (Former name, former address and former fiscal year,
                          if changed since last report)

         Indicate by check mark whether the registrant (l) 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

         Indicate the number of shares  outstanding  of the issuer's  classes of
common stock as of the latest practicable date:

         Limited Voting Shares,  par value $1.00 (Canadian) per share 14,284,970
shares outstanding as of May 9, 2000.


<PAGE>


                         CANADA SOUTHERN PETROLEUM LTD.

                                    FORM 10-Q

                                 MARCH 31, 2000

                                Table of Contents


                         PART I - FINANCIAL INFORMATION


ITEM 1    Financial Statements                                             Page
                                                                           ----
          Consolidated balance sheets at March 31, 2000 and
          December 31, 1999                                                  3

          Consolidated statements of operations and deficit for the three
          months ended March 31, 2000 and March 31, 1999                     4

          Consolidated statements of cash flows for the three months ended
          March 31, 2000 and March 31, 1999                                  5

          Notes to consolidated financial statements                         6

ITEM 2    Management's Discussion and Analysis of Financial Condition and
          Results of Operations                                              9

ITEM 3    Quantitative and Qualitative Disclosure About Market Risk         14

                           PART II - OTHER INFORMATION

ITEM 5    Other Information                                                 15

ITEM 6    Exhibits and Reports on Form 8-K                                  15

          Signatures                                                        16


<PAGE>


17

                         CANADA SOUTHERN PETROLEUM LTD.
                                    FORM 10-Q
                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                           CONSOLIDATED BALANCE SHEETS
                         (Expressed in Canadian dollars)
<TABLE>
<CAPTION>

                                                                               March 31,             December 31,
                                                                                  2000                   1999

------------------------------------------------------------------------------------------------------------------------------------
                                Assets                                           (unaudited)                (Note)

Current assets:
<S>                                                                             <C>                   <C>
  Cash and cash equivalents                                                     $  3,160,452          $  3,045,530
  Marketable securities                                                                    -               568,374
  Accounts receivable                                                                414,527               360,752
  Other assets                                                                       305,460               307,519
                                                                              --------------        --------------
Total current assets                                                               3,880,439             4,282,175
                                                                               -------------         -------------

Oil and gas properties and equipment
  (full cost method)                                                               9,940,356            10,207,294
Future tax asset                                                                   1,772,972             1,583,475
                                                                               -------------         -------------
Total assets                                                                     $15,593,767           $16,072,944
                                                                                 ===========           ===========

                 Liabilities and Shareholders' Equity

Current liabilities:
  Accounts payable                                                             $     517,652         $     634,600
  Accrued liabilities                                                                 85,322                18,256
                                                                                    --------              --------
Total current liabilities                                                            602,974               652,856
                                                                                     -------               -------

Future site restoration costs                                                        148,509               174,696

Shareholders' Equity
  Limited Voting Shares, par value $1 per share
  Authorized - 100,000,000 shares
  Outstanding -14,284,970 shares                                                  14,284,970            14,284,970
  Contributed surplus                                                             26,502,342            26,502,342
                                                                                ------------          ------------
Total capital                                                                     40,787,312            40,787,312
  Deficit                                                                        (25,945,028)          (25,541,920)
                                                                                -------------         -------------
Total shareholders' equity                                                        14,842,284            15,245,392
                                                                                ------------          ------------
Total liabilities and shareholders' equity                                       $15,593,767           $16,072,944
                                                                                 ===========           ===========
</TABLE>

Note: The balance sheet at December 31, 1999 has been derived from the audited
           consolidated financial statements at that date.

                             See accompanying notes.

<PAGE>


                         CANADA SOUTHERN PETROLEUM LTD.
                                    FORM 10-Q

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
                         (Expressed in Canadian dollars)
<TABLE>
<CAPTION>

                                                                                      Three months ended
                                                                                          March 31,

------------------------------------------------------------------------------------------------------------------------------------
                                                                                 2000                   1999
                                                                                (unaudited)             (Restated)
Revenues:
<S>                                                                        <C>                     <C>
  Oil sales                                                                $          6,112        $        30,094
  Gas sales                                                                          20,550                 20,574
  Proceeds from carried interests                                                   299,999                 27,056
  Interest and other income                                                          44,563                 83,358
                                                                           ----------------       ----------------
                                                                                    371,224                161,082
                                                                            ---------------        ---------------
Costs and expenses:
  General and administrative                                                        390,194                359,597
  Legal                                                                             488,722                557,464
  Lease operating costs                                                              10,948                 30,763
  Depletion, depreciation, and amortization                                          67,500                105,900
  Foreign exchange loss (gain)                                                       (8,130)                36,926
  Rent                                                                               14,595                 14,422
                                                                           ----------------       ----------------
                                                                                    963,829              1,105,072
                                                                            ---------------         --------------
  Loss before income taxes                                                         (592,605)              (943,990)
  Income tax recovery                                                               189,497                 41,305
                                                                          -----------------     ------------------
Net loss                                                                           (403,108)              (902,685)

Deficit - beginning of period                                                   (25,541,920)           (22,540,496)
                                                                              --------------         --------------
Deficit - end of period                                                        $(25,945,028)          $(23,443,181)
                                                                               =============          =============

Average number of shares outstanding                                             14,284,970             14,234,740
                                                                                 ==========             ==========

Net loss per share (Basic & Fully Diluted)                                        $(.03)                 $(.06)
                                                                                  ======                 ======
</TABLE>


                             See accompanying notes.


<PAGE>


                         CANADA SOUTHERN PETROLEUM LTD.
                                    FORM 10-Q

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (Expressed in Canadian dollars)
<TABLE>
<CAPTION>

                                                                                    Three months ended
                                                                                        March 31,

------------------------------------------------------------------------------------------------------------------------------------
                                                                               2000                   1999
                                                                            (unaudited)            (Restated)
Cash flows from operating activities:
<S>                                                                           <C>                    <C>
    Net loss                                                                  $  (403,108)           $  (902,685)
    Adjustments to reconcile net loss
    to net cash used in operating activities
      Depreciation, depletion and amortization                                     67,500                105,900
      Future site restoration costs                                               (26,187)                     -
      Future tax recovery                                                        (189,497)               (41,305)
    Change in current assets and liabilities:
      Accounts and interest receivable                                            (53,775)              (164,758)
      Other assets                                                                  2,059                 34,698
      Accounts payable                                                           (116,948)               (98,863)
      Accrued liabilities                                                          67,066                 48,610
                                                                             ------------          -------------
  Net cash used in operations                                                   ( 652,890)            (1,018,403)
                                                                              ------------           ------------

Cash flows from investing activities:
  Additions to oil and gas properties                                            (136,562)              (209,661)
  Proceeds from sale of properties                                                336,000                      -
  Sale of marketable securities                                                   568,374                 10,510
                                                                              -----------          -------------
Net cash provided by (used in) investing activities                               767,812               (199,151)
                                                                              -----------           -------------

Increase (decrease)in cash and cash equivalents                                   114,922             (1,217,554)
Cash and cash equivalents at the
  beginning of period                                                           3,045,530              6,208,634
                                                                              -----------            -----------
Cash and cash equivalents at the end of period                                 $3,160,452             $4,991,080
                                                                               ==========             ==========
</TABLE>

                             See accompanying notes.



<PAGE>


                         CANADA SOUTHERN PETROLEUM LTD.
                                    FORM 10-Q
                         PART I - FINANCIAL INFORMATION

                                 March 31, 2000
                         (Expressed in Canadian Dollars)


Item 1.  Financial Statements - Notes

Note 1.  Basis of Presentation

         The accompanying  unaudited condensed consolidated financial statements
include the accounts of Canada  Southern  Petroleum  Ltd.  and its  wholly-owned
subsidiaries,  Canpet Inc. and C.S. Petroleum Limited. and have been prepared in
accordance  with  accounting   principles  generally  accepted  in  Canada.  The
financial statements conform in all material respects with accounting principles
generally  accepted in the United  States  ("U.S.  GAAP") for interim  financial
information and with the  instructions to Form 10-Q and Rule 10-01 of Regulation
S-X.  Accordingly,  they do not include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements.  In the opinion of management,  all adjustments considered necessary
for a fair presentation have been included. All such adjustments are of a normal
recurring nature.  Operating results for the three month periods ended March 31,
2000 are not necessarily  indicative of the results that may be expected for the
year  ending  December  31,  2000.  For  further   information,   refer  to  the
consolidated   financial  statements  and  footnotes  thereto  included  in  the
Company's Annual Report on Form 10-K for the year ended December 31, 1999.

Note 2.  Revenue Recognition

          In  December  1999,  the  Company  filed a motion to have the Court of
Queen's  Bench  direct the operator of the  Kotaneelee  gas field to make timely
payments of all current and future  amounts due from its share of the Kotaneelee
gas field revenues.  The motion was  subsequently  amended to include all of the
defendants.  On April 10, 2000, the trial court  dismissed the Company's  motion
pending  the  Court's  ultimate  determination  of the  issues  surrounding  the
Kotaneelee  field  carried-interest  account.  The Company intends to appeal the
decision to the Alberta Court of Appeal.

          In view of the Court's dismissal of the Company's motion,  the Company
does not intend to accrue  any  revenues  from the  Kotaneelee  gas field  until
collection of the amounts due is reasonably assured.

         Based on the latest report from the operator of the  Kotaneelee  field,
the Company believes its share of net revenues due the Company is as follows:



<PAGE>


Item 1.  Financial Statements - Notes (Cont'd)
<TABLE>
<CAPTION>
                                                                  Amounts                     Amounts
                                                                 due from                   deposited
                                                              all parties                   in escrow
<S>                                                              <C>                         <C>
Previously  reported                                             $412,374                    $136,728
January production                                                488,014                     161,807
                                                                  -------                     -------
Balance due                                                      $900,388                    $298,535
                                                                 ========                    ========
</TABLE>

Note 3.  Accounting Policy Changes

         In  1999,  under  new  recommendations  of the  Canadian  Institute  of
Chartered Accountants, the Company retroactively adopted the liability method of
accounting for income taxes.

     Under this  method  the  Company  records  income  taxes to give  effect to
temporary  differences  between  the  carrying  amount  and the tax basis of the
Company's  assets  and  liabilities.   Temporary   differences  arise  when  the
realization  of an asset or the  settlement  of a  liability  would give rise to
either an increase or decrease in the  Company's  income  taxes  payable for the
year or later period. Future income taxes are recorded at the enacted income tax
rates that are expected to apply when the future tax liability is settled or the
future tax asset is  realized.  Income tax  expense is the tax  payable  for the
period and the change during the period in future income tax and liabilities.


         Adoption  of the  liability  method  of  accounting  for  income  taxes
resulted in changes to previously  reported net income, net income per share and
the balance sheet accounts, as follows:
<TABLE>
<CAPTION>
                                                                                    1999
                                                                                  ------------
<S>                                                                                 <C>
Net loss previously reported                                                        $(943,990)
Adjustment for the effect of the change in accounting method                            41,305
                                                                                  ------------
           Net loss as restated                                                      $(902,685)
                                                                                  -------------

Net loss per share previously reported                                                  $(.07)
Adjustment for the effect of the change in accounting method                               .01
                                                                                        ------
           Net loss per share as restated                                               $(.06)
                                                                                        ======

</TABLE>

         If the tax  allocation  method of accounting  for income taxes had been
retained, the Company would have reported a net loss of $(592,605) or $(.04) per
share for 2000.

<PAGE>
Note 4.  Oil and Gas Properties

         During 1999, the Company's  primary Alberta asset and revenue producing
property was its heavy crude oil production and related  facilities at Kitscoty.
The  Company  sold  its 10 %  working  interest  to the  operator  for  $336,000
effective  October 1, 1999. The transaction  was completed  during February 2000
and the  proceeds  of sale were  credited to oil and gas  properties  during the
quarter ended March 31, 2000.


Note 5.    General and Administrative Expenses - Compensation

         Effective January 3, 2000,  Mr. Ben A. Anderson was employed as
Executive Vice President for a two year period at an annual salary of $ 120,000.
Mr. Anderson also received options to purchase 75,000 Limited Voting Shares of
the Company with 1/3 of the total vesting immediately , 1/3 vesting after one
year and 1/3 vesting after two years.  Mr. Anderson will also receive an annual
vehicle allowance payment of $12,000.  Mr. Anderson succeeded Mr. Ashton as
President and CEO of the Company on April 1, 2000.  Mr. Anderson was also
appointed a director of the Company on the same da

Note 6.    Leases

         The future  minimum  rental  payments  and  estimated  operating  costs
applicable to the Company's  noncancelable  five year  operating  (office) lease
which is effective June 1, 2000 are as follows:

                 Fiscal Year                               Amount

                    2000                                    $23,061
                    2001                                     39,534
                    2002                                     40,943
                    2003                                     41,949
                    2004                                     41,949
                    2005                                     17,478
                                                            --------
                    Total                                   $204,914
                                                            ========
<PAGE>

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

     Statements  included in  Management's  Discussion and Analysis of Financial
Condition  and  Results of  Operations  which are not  historical  in nature are
intended to be, and are hereby  identified as, "forward looking  statements" for
purposes of the "Safe Harbor" Statement under the Private Securities  Litigation
Reform Act of 1995. The Company cautions readers that forward looking statements
are subject to certain risks and  uncertainties  that could cause actual results
to differ materially from those indicated in the forward looking statements.
     Among these risks and uncertainties are:

     o    uncertainties as to the costs, length and outcome of the Kotaneelee
          litigation;

     o    uncertainty as to when or if the Company will receive its share of
          revenue from the Kotaneelee gas field.

Liquidity and Capital Resources

         At March 31, 2000, the Company had  approximately  $3.2 million of cash
and marketable  securities available.  Of this amount,  approximately $1 million
are  held  in  U.S.   marketable   securities  which  are  subject  to  exchange
fluctuations.  These  funds  are  expected  to be  used  for  general  corporate
purposes, including exploration and to continue the Kotaneelee field litigation.

         Cash flow used in  operations  during the three  months ended March 31,
2000 decreased to $653,000  compared to $1,018,000  during the  comparable  1999
period.  The  difference  between  the  periods  was  caused  primarily  by  the
following:

                  Decrease in loss from operations           $ 287,000
                  Changes in accounts receivable and other      78,000
                  Net change in current liabilities                  -
                                                              ---------
                  Difference in net cash used in operations   $365,000
                                                              =========

          In  December  1999,  the  Company  filed a motion to have the Court of
Queen's  Bench  direct the operator of the  Kotaneelee  gas field to make timely
payments of all current and future  amounts due from its share of the Kotaneelee
gas field revenues.  The motion was  subsequently  amended to include all of the
defendants.  On April 10, 2000, the trial court  dismissed the Company's  motion
pending  the  Court's  ultimate  determination  of the  issues  surrounding  the
Kotaneelee  field  carried-interest  account.  The Company intends to appeal the
decision to the Alberta Court of Appeal.


<PAGE>


Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations (Cont'd)

          In view of the Court's dismissal of the Company's motion,  the Company
does not intend to accrue  any  revenues  from the  Kotaneelee  gas field  until
collection of the amounts due is reasonably assured.

         Based on the latest report from the operator of the  Kotaneelee  field,
the Company believes its share of net revenues due the Company is as follows:

                                        Amounts                      Amounts
                                        due from                    deposited
                                        all parties                 in escrow
Previously  reported                    $412,374                    $136,728
January production                       488,014                     161,807
                                         -------                     -------
Balance due                             $900,388                    $298,535
                                        ========                    ========

         The Company's  Annual Report on Form 10-K for the year ended December
31, 1999 should be read for a detailed  discussion of the Kotaneelee litigation.

         A  significant  proportion  of the  Company's  property  interests  are
covered by carried interest agreements,  which provide that expenditures made by
the operator are recouped solely out of revenues from production.  Major capital
expenditures  made by the operators  have an impact on the  Company's  cash flow
from  operations as no revenues are reported or received until the capital costs
have been  recovered  by the  operator.  The  Kotaneelee  gas field and  certain
properties  in the Fort Nelson,  British  Columbia area in which the Company has
carried  interests  have  reached pay out status.  Proceeds  from these  carried
interests  plus oil and gas  sales  from  working  interest  properties  are the
Company's major sources of working capital.

         The Company is currently evaluating and expects to continue to evaluate
oil and gas properties and may make  investments  in such  properties  utilizing
cash on hand. The Company  anticipates  that its capital  expenditures  for land
acquisitions and drilling for 2000 will be approximately  $600,000. In addition,
substantial  continuing  expenses are expected to be incurred in connection with
the  Kotaneelee   Litigation.   During  the  year  1999,  the  Company  expended
approximately $2.1 million in connection with the

<PAGE>


Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations (Cont'd)

Kotaneelee Litigation which has been the principal cause of the Company's losses
since 1991.

Results of Operations

         Three month period ended March 31, 2000 vs. March 31, 1999

         The net loss for the quarter  ended March 31, 2000 was  $403,108  ($.03
per  share)  compared  to a net loss of  $902,685  ($.06 per share) for the 1999
period. A summary of revenue and expenses during the periods is as follows:
<TABLE>
<CAPTION>

                                           2000                         1999                      Net Change
                                           ----                         ----                      ----------
<S>                                     <C>                          <C>                             <C>
Revenues                                $    371,224                 $    161,082                    $ 210,142
Costs and expenses                          (963,829)                  (1,105,072)                     141,243
Income tax recovery                          189,497                       41,305                      148,192
                                             -------                -------------                      -------
Net loss                                $   (403,108)                $   (902,685)                  $  499,577
                                        =============                =============                  ==========
</TABLE>

         Oil  sales  decreased  by  80%  due  primarily  to a  94%  decrease  in
production  which was partially  offset by a 206% increase in the average prices
of crude oil sold. There was also a corresponding  decrease in royalties paid by
the Company. The Company sold the majority of its crude oil producing properties
in 1998.  The Company also sold its remaining  heavy oil  production in February
2000, effective as of October 1, 1999. Since the Company has disposed of most of
its  producing  properties,  future oil sales are expected to be minimal  unless
additional producing  properties are drilled or purchased.  Crude oil unit sales
in barrels  ("bbls")  (before  deducting  royalties)  and the average  price per
barrel sold during the periods indicated were as follows:

<TABLE>
<CAPTION>

                                                      Three month period ended March 31,
                                         2000                                            1999
                                      ----------                                       ----------
                                     Average price                                   Average price
                          bbls          per bbl              Total         bbls         per bbl             Total
<S>                        <C>          <C>                  <C>         <C>            <C>                 <C>
Oil sales                  178          $34.34               $ 6,000     2,752          $11.21              $31,000
Royalties paid                                                     -                                         (1,000)
                                                             -------                                        --------
Total                                                        $ 6,000                                        $30,000
                                                             =======                                        ========
</TABLE>



<PAGE>


Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations (Cont'd))

         Gas sales  remained the same in 2000.  There was an 11% decrease in the
number of units sold which was offset by an 11%  increase in the  average  price
for gas. Gas sales include  royalty income which also remained the same in 2000.
The Company sold the majority of its working  interest gas  properties  in 1998.
The volumes in million  cubic feet  ("mmcf")  and the  average  price of gas per
thousand cubic feet ("mcf") sold during the periods indicated were as follows:

<TABLE>
<CAPTION>

                                                       Three month period ended March 31,
                                              2000                                             1999
                                            ---------                                        ----------
                                      Average price                                    Average price
                          mmcf           per mcf             Total          mmcf          per mcf             Total
<S>                        <C>            <C>                <C>            <C>            <C>                <C>
Gas sales                  4.0            $1.96              $  7,000       4.5            $1.76              $  8,000
Royalty income                                                 15,000                                           15,000
Royalties paid                                                 (1,000)                                          (2,000)
                                                            ----------                                       ----------
Total                                                         $21,000                                          $21,000
                                                              =======                                          =======
</TABLE>

         Proceeds from carried interests increased 1009% to $300,000 during 2000
compared  to $27,000 in 1999  because  gas prices  increased  26% and unit sales
increased  10%.  Capital  expenditures  decreased  91% in 2000 from  $161,000 to
$14,000 during 1999 . The volumes in million cubic feet ("mmcf") and the average
price of gas per thousand  cubic feet ("mcf") sold during the periods  indicated
were as follows:
<TABLE>
<CAPTION>

                                           1999                                            1998
                                         ---------                                       ----------
                                      Average price                                   Average price
                          mmcf           per mcf          Total           mmcf           per mcf           Total

<S>                        <C>            <C>             <C>              <C>            <C>               <C>
Gas sales                  153            $3.51           $ 537,000        139            $2.79             $388,000
Royalty paid                                               (116,000)                                         (93,000)
Operating costs                                            (107,000)                                        (107,000)
Capital costs                                               (14,000                                         (161,000)
                                                            -------                                         ---------
Total                                                     $ 300,000                                          $27,000
                                                          =========                                          =======
</TABLE>

         Interest  and  other  income  was 47%  lower in 2000.  Interest  income
decreased  46% from  $72,000 in 1999 to $39,000 in the 2000 period  because less
funds were  available  for  investment.  In addition,  the 2000 period  includes
proceeds  from the sale of  seismic  data in the  amount of $6,000  compared  to
$4,000 in 1999.


<PAGE>


Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations (Cont'd)

         General and administrative  costs increased 9% in 2000 to $390,000 from
$360,000 in 1999.  The Company hired a new executive  vice  president  effective
January 1, 2000 which increased salary expense approximately $33,000.

         Legal  expenses  decreased  12% during 2000 to $489,000  from  $557,000
during 1999. These expenses are related  primarily to the cost of the Kotaneelee
litigation. During the 2000 period, the Company presented its rebuttal evidence.

         Lease operating costs decreased 64% from $31,000 in 1999 to $11,000 in
the 2000 period.  The Company sold its remaining heavy oil production properties
during February 2000.

         Depletion,  depreciation and amortization expense decreased 36% in 2000
to $68,000 from $106,000 in 1999.  The depletion  rate in 2000  decreased by 32%
from the 1999 rate. Also, the capital asset base in 2000 decreased 6% from 1999.

         A foreign  exchange gain of $8,000 was recorded in 2000,  compared to a
loss of  $31,000 in 1999 on the  Company's  U.S.  investments.  The value of the
Canadian  dollar was U.S. $.6924 at December 31, 1999 compared to U.S. $.6899 at
March 31, 2000.

         Income tax recovery increased by 359% to $ 189,000 in 2000 compared to
$ 41,000  in 1999.  During  February  2000,  the  Company  sold  its  heavy  oil
production  properties.   Although  the  book  basis  of  the  Company's  assets
decreased, the tax basis of the assets were unaffected by the sale. .



<PAGE>


Item 3.  Quantitative and Qualitative Disclosure About Market Risk

         The Company  does not have any  significant  exposure to market risk as
the only market risk  sensitive  instruments  are its  investments in marketable
securities. At March 31, 2000, the carrying value of such investments (including
those classified as cash and cash  equivalents) was  approximately $ 2.8 million
which was  approximately  equal to fair value and face value of the investments.
Since the Company  expects to hold the  investments  to  maturity,  the maturity
value should be realized.  In addition,  the Company's investments in marketable
securities  included  investments held in the United States which are subject to
foreign exchange fluctuations.  At March 31, 2000, the investments in the United
States totaled $1 million .



<PAGE>



                         CANADA SOUTHERN PETROLEUM LTD.

                                    FORM 10-Q

                           PART II - OTHER INFORMATION

                                 March 31, 2000

Item 5.  Other Information

          In  December  1999,  the  Company  filed a motion to have the Court of
Queen's  Bench  direct the operator of the  Kotaneelee  gas field to make timely
payments of all current and future  amounts due from its share of the Kotaneelee
gas field revenues.  The motion was  subsequently  amended to include all of the
defendants.  On April 10, 2000, the trial court  dismissed the Company's  motion
pending  the  Court's  ultimate  determination  of the  issues  surrounding  the
Kotaneelee  field  carried-interest  account.  The Company intends to appeal the
decision to the Alberta Court of Appeal.

         On April 24, 2000, the Company  completed the  presentation of rebuttal
evidence and rested its case in its lawsuit against Amoco Canada and others.


Item 6.  Exhibits and Reports on Form 8-K

          (a)     Exhibits

                  None.

          (b)     Reports on Form 8-K

                  None.



<PAGE>



                         CANADA SOUTHERN PETROLEUM LTD.

                                    FORM 10-Q

                                 MARCH 31, 2000



                                   SIGNATURES




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



                                                  CANADA SOUTHERN PETROLEUM LTD.
                                                            Registrant




Date:  May 12  , 2000                      By  /s/ Kelly B. Johnson
                                             -----------------------------------
                                             Treasurer and Chief Financial and
                                             Accounting Officer