SECURITIES & EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549

                                   FORM 10-Q


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


For the Quarter Ended September 30, 1998        Commission File Number: 0-5781


                            HAWKS INDUSTRIES, INC.
------------------------------------------------------------------------------
            (Exact name of registrant as specified in its charter)


        Wyoming                                          83-0211955
------------------------                        ------------------------------
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                     Identification Number)


                   913 Foster Road, Casper, Wyoming  82601
------------------------------------------------------------------------------
                   (Address of principal executive offices)



Registrant's telephone number, including area code(307) 234-1593
                                                  ----------------------------



                                  N/A
------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12  months (or  for such shorter  period that  the registrant  was
required to  file  such  reports), and  (2)  has  been subject  to  such  filing
requirements for the past 90 days.

YES  X                   NO ___
    ----


Indicate the number  of shares outstanding  of each of  the issuer's classes  of
common stock, as of the close of the period covered by this report.

         Class                             Outstanding at September  30, 1998
------------------------                  ------------------------------------
Capital Stock, $.01 par value                          1,351,515
<PAGE>





                                     INDEX
                                     -----


                                                                 PAGE

PART I      FINANCIAL INFORMATION                                 3

            Consolidated Balance Sheets
                September 30, 1998 and December 31, 1997          4

            Consolidated Statements of Operations
                Three months and Nine months ended
                September 30, 1998 and 1997                       5

            Consolidated Statements of Cash Flows
                Nine months ended September 30, 1998 and 1997     6

            Notes to Consolidated Financial Statements            7

            Management's Discussion and Analysis of
                Financial Condition and Results of Operation     11


PART II     OTHER INFORMATION                                    13


<PAGE>





                         PART I: FINANCIAL INFORMATION



The accompanying unaudited Consolidated Financial Statements have been  prepared
in accordance with the instructions to Form 10-Q  and 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 (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included.

These statements should be read in conjunction with the Financial Statements and
notes thereto included in the Company's  Annual Report to Shareholders and  Form
10-K for the year ending December 31, 1997.
<PAGE>
<TABLE>
                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
<CAPTION>
                                               September 30,     December 31,
                                                   1998              1997
                                                (unaudited)

<S>                                           <C>               <C>
                  ASSETS
                  ------
CURRENT ASSETS
  Cash                                       $         32,000 $         30,000
  Accounts receivable                                 557,000          330,000
  Short-term investments                              202,000          205,000
  Costs on uncompleted contracts in excess             34,000           12,000
  of related billings
  Other current assets                                 63,000           50,000

PROPERTY AND EQUIPMENT, net (successful
efforts method)                                     1,742,000        2,112,000

NOTE RECEIVABLE                                        34,000           38,000

LAND INVESTMENT                                       196,000          202,000

AVAILABLE FOR SALE INVESTMENTS                        100,000         -

OTHER ASSETS                                          262,000          215,000

                                             $      3,222,000 $      3,194,000



   LIABILITIES AND SHAREHOLDERS' EQUITY
    ------------------------------------
CURRENT LIABILITIES
  Notes payable                              $        303,000 $        240,000
  Current maturities of long-term debt                115,000          227,000
  Accounts payable                                    241,000          275,000
  Accrued liabilities                                  37,000           25,000
<PAGE>


     Total current liabilities                        696,000          767,000

LONG-TERM DEBT                                        364,000          415,000

CONTINGENT LIABILITY (SEE NOTE 4)                    -                -

SHAREHOLDERS' EQUITY
  Capital stock:
     Preferred stock, $.01 par value;
       authorized 997,000shares;
       no shares issued                             -                  -
     Common stock, $.01 par value;
       authorized 5,000,000 shares;
       outstanding 1998 - 1,351,515
       shares;1997 - 1,351,515 shares                  13,000           13,000
  Capital in excess of par value of common
  stock                                             2,880,000        2,880,000
  Retained (deficit) (since elimination of
     deficit at December 31, 1988)                   (731,000)        (881,000 )

                                                    2,162,000        2,012,000

                                             $      3,222,000 $      3,194,000


<FN>
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
<TABLE>
                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS
         Three Months and Nine Months Ended September 30, 1998 and 1997
                                  (Unaudited)
<CAPTION>
                                Three Months Ended September         Nine Months Ended
                                            30,                        September 30,
                                     1998           1997            1998        1997
                                     ----           ----            ----        ----
<S>                                <C>           <C>             <C>          <C>
Operating revenue:
  Oil and gas                  $      34,000   $    63,000   $     176,000  $   262,000
  Environmental                      560,000       494,000       1,680,000    1,385,000
  Gain on sale of assets               -             5,000           3,000       17,000

                                     594,000       562,000       1,859,000    1,664,000

Operating expenses:
  Oil and gas                        (8,000)        29,000          35,000      112,000
  Environmental                      462,000       462,000       1,384,000    1,362,000
  Depreciation, depletion and
  amortization                        50,000        65,000         156,000      194,000
  General and administrative          36,000        52,000         152,000      175,000

                                     540,000       608,000       1,727,000    1,843,000

Operating Income (loss) from
  operations                          54,000       (46,000)        132,000     (179,000)
Other income (expense):
  Other income                         3,000         6,000          16,000       29,000
  Interest income                      3,000         6,000          10,000       17,000
  Interest expense                   (17,000)      (18,000)        (56,000 )    (53,000)
      Sale of buildings                 -             -             48,000        -

Income (Loss) Before Taxes            43,000       (52,000)        150,000     (186,000)

Provision for taxes:
  Current                                -              -              -            -

Net income (loss)              $      43,000   $   (52,000)  $     150,000  $  (186,000)

Weighted average number of
common shares outstanding          1,351,515     1,351,410       1,351,515    1,351,059

Income (Loss) per common share $        0.03   $     (0.04)  $        0.11  $     (0.13)


<FN>
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
<TABLE>
                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                 Nine Months Ended September 30, 1998 and 1997
                                  (Unaudited)
<CAPTION>
                                                       1998          1997
                                                       ----          ----
<S>                                              <C>            <C>
Cash flows from operating activities:
  Income (Loss) from operations                  $     150,000  $ (186,000)
  Adjustment to reconcile net loss to net
  cash provided:
     Depreciation, depletion and amortization          156,000     194,000
     Impairment of non-producing oil and gas
     property                                            4,000       4,000
     Gain on sale of assets                            (51,000)    (17,000)
     Changes in operating assets and
     liabilities:
     Increase in accounts receivable                  (227,000)   (144,000)
     Decrease (increase) in costs in excess
       of billings and other current assets            (35,000)     39,000
     Decrease in accounts payable and accrued
       expenses                                        (22,000)    (98,000)

Net cash flow used in operating activities             (25,000)   (208,000)

Cash flows from investing activities:
  Purchases of property and equipment                 (196,000)    (85,000)
  Proceeds from sale of properties                     457,000      33,000
  Increase in other assets                             (47,000)     (3,000)
  Decrease in note receivable                            4,000       3,000
  Decrease in land investment                            6,000         -
   Increase in available for sale investments         (100,000)        -
       Decrease in short-term investments                3,000     318,000

Net cash flow provided by investment
activities                                             127,000     266,000

Cash flows from financing activities:
  Proceeds from debt obligations incurred              183,000     200,000
  Reduction of debt obligations                       (283,000)   (321,000)
  Issuance of common stock                                 -        39,000

Net cash provided by (used in) financing
activities                                            (100,000)    (82,000)

Increase (decrease) in cash and cash
equivalents                                              2,000     (24,000)
Cash and cash equivalents at beginning of
year                                                    30,000      48,000

Cash and cash equivalents at end of period          $   32,000  $   24,000


<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1.  Property and Equipment

Property and equipment at September 30,  1998 and December 31, 1997 consists  of
the following:
<TABLE>
<CAPTION>
                                                1998         1997
                                                ----         ----
<S>                                          <C>           <C>
Nonproducing oil and gas properties, net of
  valuation allowance of $1,000 in 1998 and
  $8,000 in 1997                            $    15,000  $    19,000
Producing oil and gas properties              1,655,000    1,659,000
Furniture and fixtures                          385,000      391,000
Transportation equipment                        200,000      235,000
Buildings and leasehold improvements            369,000      816,000
Engineering and lab equipment                 1,259,000    1,111,000
Other                                            59,000      118,000

                                              3,942,000    4,349,000
Less accumulated depreciation and depletion   2,200,000    2,237,000

                                            $ 1,742,000  $ 2,112,000

</TABLE>

Note 2.  Notes Payable, Long-Term Debt, and Pledged Assets

Notes payable at September 30, 1998 and December 31, 1997 are as follow:
<TABLE>
<CAPTION>
                                                          1998       1997
                                                          ----       ----
<S>                                                     <C>         <C>
Revolving line of credit $230,000, interest at
  Citibank Prime plus /%, (9.25% at September 30,
  1998) maturing May 13, 1999, collaterized by oil and
  gas properties                                       $  90,000  $     -
Short-term note payable due bank, interest at 11.5%
  payable $700 per month including interest until
  October 15, 1998, then balance due in lump sum,
  collateralized by building                                 -       40,000
Short-term notes payable due bank, interest at 10%,
  due October 25, 1998, collateralized by accounts
  receivable                                              45,000       -
Revolving line of credit $200,000, interest at 6.6% -
  7.0% maturing June 23, 1999, collateralized by         168,000    200,000
  certificates of deposit

                                                       $ 303,000  $ 240,000


</TABLE>

Long-Term debt at September 30, 1998 and December 31, 1997 is as follows:
<TABLE>
<CAPTION>
                                                          1998       1997
                                                          ----       ----
<S>                                                     <C>         <C>
Mortgage note payable to bank, interest set at 3.125%
  above U.S. Treasury Bill index for one year each
  June 1st collateralized by office building           $     -    $  74,000

Mortgage note payable to City of Casper, interest at
  4%, payable $859 per month including interest until
  June 8, 1998 then balance due in lump sum,                -       144,000
  collateralized by office building and warehouse

Mortgage notes payable to W.D. Hodges and Jim Ferris
  Properties, interest at 9% payable $971 per month
  until September 17, 2013, collateralized by building    96,000     97,000
</TABLE>
<PAGE>
                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2.  Notes Payable, Long-Term Debt and Pledged Assets (cont.)
<TABLE>
<CAPTION>
                                                          1998       1997
                                                          ----       ----
<S>                                                     <C>         <C>
Mortgage note payable to bank, interest set at 4%
  above U.S. Treasury Bill index for one year each
  April 1st, (9.3% at September 30, 1998) payable
  $1,213 per month including interest until March 22,
  2009, collateralized by office building              $  97,000  $ 102,000
</TABLE>
<TABLE>
<S>                                                     <C>         <C>
Lease payable, Eaton Financial Corporation, payable
  $1,227 per month including interest, collateralized
  by computer equipment with original cost of $49,000,
  accumulated depreciation of $26,000 and $22,000 at
  1998 and 1997                                            -          2,000
</TABLE>
<TABLE>
<S>                                                     <C>         <C>
Note payable, State of Wyoming, interest at 4%, due in
  monthly installments of approximately $1,000
  including interest until balance paid, unsecured         9,000     16,000
</TABLE>
<TABLE>
<S>                                                     <C>         <C>
Installment loans payable, due August 1999 to May
  2001, interest at 7% to 10%, secured by automotive
  equipment                                               23,000     15,000
</TABLE>
<TABLE>
<S>                                                     <C>         <C>
Note   payable    Wyoming    Industrial    Development
  Corporation, interest  at 7.33%,  payable $3,991 per
  month  including  interest  until  October  5, 2002,
  collateralized by equipment.                          166,000     192,000

Note payable Wyoming Industrial Development
  Corporation, interest at 6.96%, payable $4,475 per
  month including interest until June 15, 2000,
  collateralized by equipment.                            88,000        -

                                                         479,000    642,000
Less current maturities                                  115,000    227,000

                                                       $ 364,000  $ 415,000


</TABLE>

Aggregate maturities of long-term debt are as follow:
<TABLE>

<S>             <C>
1998           $  29,000
1999             112,000
2000              84,000
2001              58,000
2002              47,000
Thereafter       149,000

               $ 479,000

</TABLE>

Actual cash payments for  interest during the periods  ended September 30,  1998
and 1997 were $56,000 and $49,000 respectively.
<PAGE>

                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 3.  Financial Information Relating to Industry Segments
<TABLE>
<CAPTION>
                                                1998         1997
                                                ----         ----
<S>                                          <C>           <C>
Sales to unaffiliated customers:
  Oil and gas industry                      $   176,000  $   273,000
  Environmental testing and management
  industry                                    1,683,000    1,391,000

                                            $ 1,859,000  $ 1,664,000

Operating profit or (loss):
  Oil and gas industry                      $    29,000  $     1,000
  Environmental testing and management
  industry                                      219,000      (48,000 )
  Unallocated corporate expenses               (116,000)    (132,000 )

                                            $   132,000  $  (179,000 )

Identifiable assets:
  Oil and gas industry                      $   788,000  $   859,000
  Environmental testing and management
  industry                                    1,247,000    1,005,000
  Corporate assets                            1,187,000    1,535,000

                                            $ 3,222,000  $ 3,399,000

Capital expenditures:
  Oil and gas industry                      $     3,000  $    70,000
  Environmental testing and management
  industry                                      193,000       15,000

                                            $   196,000  $    85,000


Depreciation, depletion and amortization:
  Oil and gas industry                      $    70,000  $    89,000
  Environmental testing and management
  industry                                       79,000       73,000
  Other depreciation, depletion, and
  amortization                                   11,000       36,000

                                            $   160,000  $   198,000


   </TABLE>


Note 4.  Significant Events

Effective February  1, 1998,  Registrant, Hawks  Industries, Inc.,  and a  third
party investor, entered into an agreement  with the Company's President,  Joseph
J. McQuade, whereby Mr.  McQuade and his  immediate family's stockholdings  were
purchased by the third party investor at $0.10 per share($2.00 post-split).  The
Company has entered into a severance agreement with Mr. McQuade which includes a
covenant not to compete.  Under the terms of the Agreement, the Company will pay
$50,000 per year for  four (4) years, payable  in semi-monthly installments,  to
McQuade in exchange for  the non-compete provision.   Mr. McQuade, effective  on
the same date, resigned as President of the Company and Chairman of the Board of
Directors.  Mr. Bruce A. Hinchey,  the Company's Vice President, was elected  by
the Board of Directors to be the President  of the Corporation and Mr. James  E.
Meador, Jr., was  selected to  be the Vice-President.   No  replacement for  Mr.
McQuade, on the Board of Directors, has been made as of the date of this report.

<PAGE>

                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 4.  Significant Events (cont.)

The third party investor, the Anne D. Zimmerman Revocable Trust, dated  November
14, 1991 ("the Trust"),  by acquiring Mr. McQuade's  and his immediate  family's
shares, has 3,063,331 shares (153,167 shares after reverse split) and  therefore
has acquired 11.2% of the outstanding shares of the Company.  As such, the Trust
is deemed  to be  a controlling  person.   The  Trustee of  the Trust,  Anne  D.
Zimmerman, will not sit on the Company's Board of Directors, nor will she be  an
employee or officer of the Company.

Reverse Stock Split

At the Company's Annual Meeting held  on January 8, 1998, the Company  submitted
to a vote of security holders, through the solicitation of proxies or otherwise,
a proposal to effect a 20 for 1 reverse  split which was approved.  The  reverse
split changed the number of shares outstanding from 27,028,194 to 1,351,515.


Note 5.  Sale of Buildings

On May 26, 1998, the Company signed an agreement to sell its buildings located
at 7345 6WN Road and 7383 6WN Road in Natrona County, Wyoming to WERCS, a
Wyoming Corporation.  As set forth in the agreement, the closing date was June
1, 1998 and the total sales price for both buildings was $417,000.

The Company's cost in the buildings was $506,000.  The Company's basis in the
buildings was $367,000.  Therefore, the Company had an approximate $50,000 gain
resulting from the transaction.

The $417,000 was received as $317,000 cash and 10,000 shares of WERCS 4%
preferred convertible stock.

The majority owner of WERCS, a Wyoming Corporation, is Dr. Gail D. Zimmerman
whose spouse, through the Anne D. Zimmerman Revocable Trust, owns 11.2% of the
outstanding shares of Hawks Industries, Inc. stock.
<PAGE>

                    HAWKS INDUSTRIES, INC. AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS



Liquidity and Capital Resources:
--------------------------------

As of September 30, 1998  the Company had working  capital of $192,000.   During
the first nine  months of  1998 the  following items  contributed in  increasing
working capital from a $140,000 deficit to the current $192,000 positive figure.

1.       During the  quarter  ended  September 30,  1998  the  Company  reported
  earnings of $43,000 and earnings for the nine month period of $150,000.   From
  these earnings the Company has increased accounts receivable from year end  by


  $227,000.     Reducing  the  $150,000   net  income   was  $160,000   non-cash
  depreciation, depletion and  amortization.  The Company purchased $196,000  of
  property  and  equipment during  the  first  nine months  of  1998,  including
  $29,000 of property and equipment during  the third quarter of 1998.  This  is
  the amount anticipated to also be purchased in the fourth quarter of 1998.

2.       The Company sold its buildings on 6WN Road in Natrona County,  Wyoming.
  This enabled the Company to pay off approximately $190,000 in current  portion
  of  long-term debt  and short-term  notes payable,  along with  providing  the
  company with  approximately $65,000 in  cash and $100,000  available for  sale
  investment, which can  be converted to cash upon  request.  The buildings  had
  been listed with  a realtor for more  than two years.   They were sold by  the
  officers which saved approximately $28,000 in realtor fees.

3.       Through local  banks,  the  Company  has  been  able  to  use  accounts
  receivable as  collateral for short-term borrowings  for current cash  demands
  in  its environmental  engineering  business.   This,  along with  a  $200,000
  revolving  line of  credit,  has enabled  the  Company to  perform  on  larger
  contracts which would not have been  possible in the past.  Also, the  company
  has a  $230,000 revolving line  of credit for  its oil and  gas division.   To
  date, the  Company has borrowed  $100,000 of this  line of credit  to pay  off
  past drilling costs in its Brundage  Canyon Field.  The balance of that  loan,
  at September 30, 1998, is $90,000.

Results of Operations:
---------------------

In the third quarter of 1998,  the Company reported $43,000 net income  compared
to a $52,000  net loss  in 1997.   This $95,000  increase was  due to  increased
revenues in the environmental business.


Environmental Engineering :
---------------------------

Environmental engineering revenues for the  third quarter increased by  $66,000,
or 13% compared with the third  quarter of 1997.   Revenues for the nine  months
ended September 30, 1998 were up by $295,000 or 21% over the same nine months of
1997.

The quarter and nine months of 1998 were aided by two large industrial contracts
that were not in existence in 1997.  Environmental engineering expenses were the
same for the third quarter of 1998 and 1997.  Expenses for the first nine months
of 1998 were  up by $22,000  or 1.6% over  the nine months  ended September  30,
1998.  The expense increase in 1998 was  the result of additional work over  the
corresponding nine months in 1997.
<PAGE>



Oil and Gas:
------------

Oil and gas revenues declined from $262,000 in  1997 to $176,000 or 33% for  the
nine months ended September  30, 1998.   Revenues for the  quarter were down  by
$29,000 or 46%.  These reductions were caused by lower oil prices, by as much as
50%.  1997 revenues  were higher due  to  "flush"  production from the  Brundage
Canyon wells that  were drilled late  in 1996.   The oil and  gas expenses  were
lowered by a refund of taxes from the  State of Utah for credits from  work-over
activities on several  wells in  the Brundage  Canyon field,  which reduced  the
operating costs  to a  negative number.   Also,  expenses were  lower due  to  a
reduction of the number of wells producing in the Brundage Canyon field.


Additional Information:
-----------------------

The Company had depreciation, depletion, and amortization(DD&A) of $160,000  for
1998 compared to $198,000 in the  nine  months ended  September 30, 1997.   This
was a 19% reduction.  For the quarter ended September 30, 1998, DD&A was $15,000
less compared to  the quarter  ended September   30,  1997 or  a 23%  reduction.
These DD&A declines were the result of less depreciation and depletion from  the
Company's oil and gas properties due to lower production.

General and  administrative costs  were lower  by $23,000  or 15%  for the  nine
months ended September 30,  1998 compared with the  nine months ended  September
30, 1997.  General and  administrative costs were lower  by $16,000, or 31%  for
the comparable quarters of  1998 and 1997.   These reductions  were due to  cost
saving practices initiated by management.

Interest  expense  was  higher  by  $3,000  or  6%  for  the  nine  months   and
approximately the same  for the quarter  ended September 30,  1998.  The  slight
increase was due to increases in short-term borrowings for the periods in 1998.


Income taxes:
-------------

The Company has  significant net  operating loss  carryforwards, investment  tax
credit carryforwards, and other carryforward items, and accordingly will not  be
liable for ordinary income taxes.

In addition, should the  Company utilize certain  loss carryforwards which  were
earned prior to the date of  the Company's quasi reorganization at December  31,
1998, Financial Accounting  Statement No. 109  requires that  deferred taxes  be
provided.  The Company has taken the position that to provide such disclosure is
not only meaningless but somewhat distortive.   As of the third quarter 1998  no
such income tax provision would have been necessary.


Year 2000 Compliant
-------------------

The Company's computer systems, software, and related technologies are affected
by the Year 2000 compliance issue.  We have been identifying and correcting
affected applications to ensure that all of our key computer systems will be
Year 2000 compliant by early 1999.  We are also working with our vendors and
suppliers to ensure their compliance.  Costs to modify such applications have
been, and are estimated to remain immaterial to our results of operations or
financial condition.
<PAGE>

Part II  OTHER INFORMATION

Item 6.  None



                                   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.
                                      HAWKS INDUSTRIES, INC.
<PAGE>

                                      (Registrant)
Date:   October 28, 1998              By: /s/ Bruce A. Hincey 
                                         __________________________
                                        Bruce A. Hinchey, President and
                                        Chief Executive Officer
Date:   October 28, 1998              By: /s/ Bill Ukele
                                         _____________________
                                        Bill Ukele, Controller and
                                        Chief Financial Officer







<PAGE>