FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

For the quarterly period ended                 September 30, 1998
                               ------------------------------------------------

[   ]    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.)

Suite 1410, One Palliser Square, 125 Ninth Avenue, S.E.,
Calgary, Alberta, Canada                                          T2G OP6
 ................................................................................
(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
l934  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 14,234,740
shares outstanding as of November 3, 1998.



<PAGE>


                                                         
                         CANADA SOUTHERN PETROLEUM LTD.

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                           CONSOLIDATED BALANCE SHEETS
                         (Expressed in Canadian dollars)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                               September 30,           December 31,
                                                                                   1998                   1997
                                                                                -----------            -----------
                                Assets

 Current assets:
<S>                                                                             <C>                    <C>        
   Cash and cash equivalents                                                    $ 2,223,071            $ 2,129,156
   Marketable securities                                                                  -              3,373,334
   Accounts and interest receivable                                                 787,663              1,226,086
   Other assets                                                                     359,247                242,278
                                                                                -----------            -----------
 Total current assets                                                             3,369,981              6,970,854
                                                                                -----------            -----------

 Oil and gas properties and equipment
   (full cost method)                                                            15,148,959             13,984,771
                                                                                -----------            -----------
 Total assets                                                                   $18,518,940            $20,955,625
                                                                                ===========            ===========

                 Liabilities and Shareholders' Equity

 Current liabilities:
   Accounts payable                                                             $   937,262            $ 1,120,521
   Accrued liabilities                                                              380,439                277,715
                                                                                -----------            -----------
 Total current liabilities                                                        1,317,701              1,398,236
                                                                                -----------            -----------

 Future site restoration costs                                                      235,786                210,974
                                                                                -----------            -----------

 Shareholders' Equity
   Limited Voting Shares, par value $1 per share
   Authorized - 100,000,000 shares
   Outstanding -14,234,740 shares                                                14,234,740             14,234,740
   Contributed surplus                                                           26,254,139             26,254,139
                                                                                -----------            -----------
   Total capital                                                                 40,488,879             40,488,879
   Deficit                                                                      (23,523,426)           (21,142,464)
                                                                                -----------            -----------
 Total shareholders' equity                                                      16,965,453             19,346,415
                                                                                -----------            -----------
 Total liabilities and shareholders' equity                                     $18,518,940            $20,955,625
                                                                                ===========            ===========
</TABLE>


<PAGE>


                                                         
                         CANADA SOUTHERN PETROLEUM LTD.

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                Consolidated Statements of Operations and Deficit
                         (Expressed in Canadian dollars)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                               Three months ended                        Nine months ended
                                                                  September 30,                             September 30,

                                                            1998                 1997                 1998                 1997
                                                        ------------         ------------         ------------         ------------ 
Revenues:
<S>                                                     <C>                  <C>                  <C>                  <C>         
  Oil sales                                             $    298,819         $    250,214         $    724,196         $    782,826
  Gas sales                                                  452,472               89,801              729,821              372,025
  Proceeds under carried interest agreements                  95,891               74,627              205,888              222,111
  Interest and other income                                   36,076               88,274              168,175              278,633
                                                        ------------         ------------         ------------         ------------ 
                                                             883,258              502,916            1,828,080            1,655,595
                                                        ------------         ------------         ------------         ------------ 
Costs and expenses:
  General and administrative                                 240,557              241,316            1,004,442              854,799
  Legal                                                      602,997              327,127            1,659,148            1,113,936
  Lease operating costs                                      359,878              186,195              942,712              618,244
  Depletion, depreciation, and amortization                  300,900              110,100              702,700              360,200
  Foreign exchange loss (gain)                              (116,918)               5,001             (186,695)             (46,422)
  Provision for future site restoration costs                 11,000                4,000               26,500               13,500
  Rent                                                        19,177               11,921               60,235               39,014
                                                        ------------         ------------         ------------         ------------ 
                                                           1,417,591              885,660            4,209,042            2,953,271
                                                        ------------         ------------         ------------         ------------ 
  Loss before income taxes                                  (534,333)            (382,744)          (2,380,962)          (1,297,676)
  Income taxes
                                                                   -                    -                    -                    -
Net loss                                                    (534,333)            (382,744)          (2,380,962)          (1,297,676)

  Deficit - beginning of period                          (22,989,093)         (20,299,732)         (21,142,464)         (19,384,800)
                                                        ------------         ------------         ------------         ------------ 
  Deficit - end of period                               $(23,523,426)        $(20,682,476)        $(23,523,426)        $(20,682,476)
                                                        =============        =============        =============        =============

Average number of shares outstanding                      14,234,740           14,154,340           14,234,740           14,039,160
                                                          ==========           ==========           ==========           ==========

Net loss per share (basic & diluted)                        $(.04)               $(.03)               $(.17)               $(.09)
                                                            ======               ======               ======               ======
</TABLE>


<PAGE>


                                                         
                         CANADA SOUTHERN PETROLEUM LTD.

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                      Consolidated Statements of Cash Flows
                         (Expressed in Canadian dollars)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                                      Nine months ended
                                                                                        September 30,
                                                                                 1998                   1997
                                                                             -----------            -----------
Cash flows from operating activities:
<S>                                                                          <C>                    <C>         
    Net loss                                                                 $(2,380,962)           $(1,297,676)
    Adjustments to reconcile net loss
    to net cash used in operating activity:
      Depreciation, depletion and amortization                                   702,700                360,200
      Future site restoration costs                                               24,812                (44,728)
    Change in current assets and liabilities:
      Accounts and interest receivable                                           438,423                 41,314
      Other                                                                     (116,969)               (25,220)
      Accounts payable                                                          (183,259)               337,891
      Accrued liabilities                                                        102,724                 39,584
                                                                             -----------            -----------
  Net cash used in operations                                                 (1,412,531)              (588,635)
                                                                             -----------            -----------

Cash flows from investing activities:
  Additions to oil and gas properties (net)                                   (1,866,888)            (2,227,733)
  Sale (purchase) of marketable securities                                     3,373,334              1,519,258
                                                                             -----------            -----------
Net cash used in investing activities                                          1,506,446               (708,475)
                                                                             -----------            -----------

Cash flows from financing activities:
  Exercise of stock options                                                            -              1,581,075
                                                                             -----------            -----------
  Net cash from financing activities                                                   -              1,581,075
                                                                             -----------            -----------

Increase (decrease) in cash and cash equivalents                                  93,915                283,965
Cash and cash equivalents at the
  beginning of period                                                          2,129,156              2,709,597
                                                                             -----------            -----------
Cash and cash equivalents at the
  end of period                                                              $ 2,223,071            $ 2,993,562
                                                                             ===========            ===========
</TABLE>



<PAGE>



                                                        
                         CANADA SOUTHERN PETROLEUM LTD.

                         PART I - FINANCIAL INFORMATION

                               September 30, 1998
                         (Expressed in Canadian Dollars)

Item 1.  Financial Statements - Notes

         The  information  for the three and nine month periods ended  September
30, 1998 and 1997 is unaudited  but includes all  adjustments  which the Company
considers  necessary for a fair statement of the results for those periods.  All
adjustments are of a normal recurring nature.

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.

Liquidity and Capital Resources

         At September 30, 1998,  the Company had  approximately  $2.2 million of
cash and securities available. Of this amount, approximately $2 million are held
in U.S.  Government  securities  and bank accounts which are subject to exchange
fluctuations.  These  funds  are  expected  to be  used  for  general  corporate
purposes,  including  exploration  and  continuation  of  the  Kotaneelee  field
litigation.

         During  November  1998,  the  Company  agreed  to sell  certain  of its
properties  in  British   Columbia  for   approximately   $3.6  million,   which
approximates the Company's  carrying costs for the properties.  These properties
generated  net  revenues of  approximately  $630,000  in 1997 and  approximately
$410,000 during the nine months ended September 30, 1998. The Company  currently
expects that the proceeds of sale will be used in connection with the Kotaneelee
litigation.

         The  Company  is also  considering  the sale of its  Alberta  heavy oil
properties in which the Company holds a minority interest. The proceeds from any
sale would be added to the Company's working capital.



<PAGE>


                         CANADA SOUTHERN PETROLEUM LTD.

                         PART I - FINANCIAL INFORMATION

                               September 30, 1998
                         (Expressed in Canadian Dollars)

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

         Cash flow used in operations during the nine months ended September 30,
1998 increased to $1,413,000  compared to $589,000  during the  comparable  1997
period.  The  difference  between  the  periods  was  caused  primarily  by  the
following:

                  Increase in loss from operations            $(671,000)
                  Changes in accounts receivable and other      305,000
                  Net change in current liabilities            (458,000)
                                                              ----------
                  Difference in net cash used in operations   $ 824,000
                                                              =========

         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.  Properties  in the Fort Nelson,  British
Columbia  area in which the Company has carried  interests  have reached  payout
status.  Proceeds  from  these  carried  interests  plus oil and gas sales  from
working  interest  properties  have been the Company's  major sources of working
capital.

         The  operator of the  Kotaneelee  gas field has reported to the Company
that  development  costs  totaling  approximately  $21  million,  of  which  the
Company's share is $6.3 million, remain to be recovered at July 31, 1998. During
the summer of 1998,  remedial  work was  performed by the operator on one of the
two wells in the Kotaneelee  field.  Approximately  $4 million in costs for this
work are not reflected in the above amounts.  Initial  indications  are that the
remedial  work on the well  could  significantly  increase  production  from the
field.

         The Company is currently evaluating and expects to continue to evaluate
oil and gas properties and may make expenditures on such properties depending on
its  financial  resources.  In  addition,  substantial  continuing  expenses are
expected  to be incurred  in  connection  with the  Kotaneelee  Litigation.  The
expense  of the  Kotaneelee  Litigation  has  been  the  principal  cause of the
Company's losses since 1991.



<PAGE>


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

Kotaneelee Litigation - Taxable Costs

         Under  Canadian law,  certain  costs (known as "taxable  costs") of the
litigation may be assessed against the  non-prevailing  party.  Previously,  the
Company had reported  that while such costs were not  determinable,  the Company
estimated  that  taxable  costs,   assuming  a  twelve  month  trial,  could  be
approximately  $1.5  million  and noted  that the judge in complex  and  lengthy
trials has the discretion to increase an award.

         Effective September 1, 1998, the Alberta Rules of Court were amended to
provide  for a  material  increase  in the  costs  which may be  awarded  to the
prevailing party in matters before the Court. In addition,  the Company believes
that the trial  will  extend  well  beyond  its  original  time  estimates  and,
therefore, potentially assessable costs would increase accordingly.

         The trial has been lengthy,  complicated  and costly to all parties and
the Company believes that the prevailing party or parties in the litigation will
argue for a substantial  assessment of costs against the non-prevailing party or
parties.  The Court has very broad  discretion  as to whether to award costs and
disbursements   and  as  to  the  calculation  of  the  amount  to  be  awarded.
Accordingly,  the Company is unable to determine  whether,  in the event that it
does not prevail on its claims in the  litigation,  it will be assessed costs or
in what amount.  However,  since the costs incurred by the Defendants  have been
substantial,  and since the Court has broad discretion in the awarding of costs,
an award to the Defendants  potentially could be material.  A cost award against
the Company  could be of sufficient  magnitude to  necessitate a sale of Company
assets  or a debt or  equity  financing  to fund  such an  award.  There  are no
assurances that any such sale or financing would be consummated.

Year 2000 Compliance

         The  Company  has  determined  that the year 2000  change  will have no
material impact on the Company's internal  operations or financial results.  The
Company expects to be year 2000 compliant by December 1998.  However, it will be
dependent on its  suppliers,  partners and  customers to make their systems year
2000 compliant.



<PAGE>


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

Results of Operations

         Three month period ended September 30, 1998 vs. September 30, 1997

         The net loss for the quarter  ended  September  30,  1998 was  $534,000
($(.04) per share)  compared to a net loss of $383,000  ($.03 per share) for the
1997 period. A summary of revenue and expenses during the periods is as follows:

                                1998                 1997             Net Change
                                ----                 ----             ----------
Revenues                    $   883,258           $ 502,916           $ 380,342
Costs and expenses           (1,417,591)           (885,660)           (531,931)
                            ------------          ----------          ----------
Net loss                    $  (534,333)          $(382,744)          $(151,589)
                            ============          ==========          ==========
                                                               
         Oil sales  increased  19% due to a 25%  increase in the number of units
sold and a  reduction  in  royalties  paid which was  partially  offset by a 32%
decrease in the price of oil sold.  Oil unit sales in barrels  ("bbls")  (before
deducting  royalties)  and the average  price per barrel sold during the periods
indicated were as follows:

                            Three month period ended September 30,
                 ---------------------------------------------------------------
                            1998                             1997
                 ------------------------------   ------------------------------
                        Average price                    Average price
                  bbls     per bbl      Total      bbls     per bbl      Total
                 ------    -------    ---------   ------    -------    ---------
Oil sales        21,304    $14.13     $301,000    17,039    $20.77     $354,000
Royalties paid                          (2,000)                        (104,000)
                                      --------                         --------
Total                                 $299,000                         $250,000
                                      ========                         ========

         Gas sales  increased  404%.  There  was a 44%  increase  in gas  prices
combined  with a 331%  increase  in the  number of units  sold.  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:

                            Three month period ended September 30,
                 ---------------------------------------------------------------
                            1998                             1997
                 ------------------------------   ------------------------------
                        Average price                    Average price
                  mmcf     per mcf       Total     mmcf     per mcf      Total
                 ------    -------    ---------   ------    -------    ---------
Gas sales          224      $2.08     $466,000      52       $1.44      $75,000
Royalty income                          38,000                           25,000
Royalties paid                         (51,000)                         (10,000)
                                      ---------                         --------
Total                                 $453,000                          $90,000
                                      ========                          =======

<PAGE>


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

         Proceeds  under carried  interest  agreements  increased 29% to $96,000
during 1998 compared to $75,000 in 1997. During the prior period,  the operators
of the  Company's  carried  interest  properties  were  recouping  their capital
expenditures on the properties from production revenues.

         Interest  and  other  income  was 59%  lower in 1998.  Interest  income
decreased  61% from $80,000 in 1997 to $36,000 in the current  period due to the
decrease in funds available for investment and lower interest rates during 1998.
In addition,  the 1998 period includes proceeds from the sale of seismic data in
the amount of $5,000 compared to $8,000 in 1997.

         Legal  expenses  increased  84% during  1998 to  $603,000  compared  to
$327,000  during 1997.  These expenses are related  primarily to the cost of the
Kotaneelee litigation.  During 1998, the Company continued the presentation of a
major part of its case against the working interest partners which was completed
on September 16, 1998. The 1998 costs  represent both legal fees and the cost of
various Company experts who testified or were being prepared for testimony.

         Lease  operating  costs increased 93% from $186,000 in 1997 to $360,000
in the 1998 period. The increase  represents the charges by the operators of the
Company's properties which is related to the increased production.  In addition,
the  Company's  share  of  production  costs  in  producing  Alberta  heavy  oil
increased.

         Depletion, depreciation and amortization expense increased 173% in 1998
to $301,000  from  $110,000 in 1997.  The  increase in  depletion in 1998 is the
result  of  increased  production  and the  amount  of  additional  costs  being
depleted.

         A foreign exchange gain of $117,000 was recorded in 1998, compared with
a loss of $5,000 in 1997 on the  Company's  U.S.  investments.  The value of the
Canadian dollar was U.S. $.6813 at June 30, 1998 compared to U.S.
$.6528 at September 30, 1998.

         Income taxes. No provision for income taxes is required for the current
period.



<PAGE>


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

         Nine month period ended September 30, 1998 vs. September 30, 1997

         The net loss for the quarter ended  September  30, 1998 was  $2,381,000
($(.17) per share) compared to a net loss of $1,298,000 ($.09 per share) for the
1997 period. A summary of revenue and expenses during the periods is as follows:

                              1998                 1997              Net Change
                              ----                 ----              ----------
Revenues                  $ 1,828,080          $ 1,655,595          $   172,485
Costs and expenses         (4,209,042)          (2,953,271)          (1,255,771)
                          ------------         ------------         ------------
Net loss                  $(2,380,962)         $(1,297,676)         $(1,083,286)
                          ============         ============         ============

         Oil sales  decreased  8% due to a 39% decrease in the price of oil sold
which was  partially  offset by a 35% increase in the number of units sold.  Oil
unit sales in barrels  ("bbls")  (before  deducting  royalties)  and the average
price per barrel sold during the periods indicated were as follows:

                            Nine month period ended September 30,
                 ---------------------------------------------------------------
                            1998                             1997
                 ------------------------------   ------------------------------
                        Average price                    Average price
                  bbls     per bbl      Total      bbls    per bbl      Total
                 ------    -------    ---------   ------   -------   -----------
Oil sales        60,723    $13.85     $841,000    45,001   $22.66    $1,020,000
Royalties paid                        (117,000)                        (237,000)
                                      ---------                      -----------
Total                                 $724,000                       $  783,000
                                      ========                       ==========

         Gas sales  increased 96%. There was a 135% increase in units sold which
was  partially  offset by an 11% decrease in gas prices.  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:

                            Nine month period ended September 30,
                 ---------------------------------------------------------------
                            1998                             1997
                 ------------------------------   ------------------------------
                        Average price                    Average price
                  mmcf     per mcf      Total      mmcf     per mcf      Total
                 ------    -------    ---------   ------    -------    ---------
Gas sales          332      $2.13     $707,000      141      $2.38     $336,000
Royalty income                         113,000                          104,000
Royalties paid                         (90,000)                         (68,000)
                                      ---------                        ---------
Total                                 $730,000                         $372,000
                                      ========                         ========
                                                          


<PAGE>


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

         Proceeds  under carried  interest  agreements  decreased 7% to $206,000
during 1998 compared to $222,000 in 1997. The operators of the Company's carried
interest  properties  have  been  making  capital  expenditures  which are being
recouped from production revenues.

         Interest  and  other  income  was 40%  lower in 1998.  Interest  income
decreased  from  $261,000 in 1997 to $143,000 in the current  year  because less
funds were  available for  investment  and interest  rates were lower.  The 1998
period also  includes  proceeds  from the sale of seismic  data in the amount of
$25,000  compared  to $18,000 in 1997.  It is not  possible  for the  Company to
estimate  the amount of future  seismic  data  sales  which are  dependent  on a
purchaser's  evaluation  of a  prospective  oil and gas prospect for the related
seismic data.

         General and administrative expenses increased 18% to $1,004,000 in 1998
from  $855,000 in 1997  primarily as a result of increased  Company  activity in
connection with the Kotaneelee litigation and the Company's exploration program.
In addition,  the  expenses  increased  in the United  States  because of the 7%
increase in the value of the U.S.  dollar compared to the Canadian dollar during
1998.

         Legal  expenses  increased  49% during 1998 to  $1,659,000  compared to
$1,114,000  during 1997. These expenses are related primarily to the cost of the
Kotaneelee litigation.  During 1998, the Company continued the presentation of a
major part of its case against the working interest partners. The Company's case
was completed on September 16, 1998 and defendants' case is now proceeding.  The
1998 costs represent both legal fees and the cost of various Company experts who
testified or were being prepared for testimony.

         Lease  operating  costs increased 52% from $618,000 in 1997 to $943,000
in the 1998 period. The increase  represents the charges by the operators of the
Company's properties which is related to the increased production.  In addition,
the  Company's  share  of  production  costs  in  producing  Alberta  heavy  oil
increased.

         Depletion,  depreciation and amortization expense increased 95% in 1998
to $703,000  from  $360,000 in 1997.  The  increase in  depletion in 1998 is the
result  of  increased  production  and the  amount  of  additional  costs  being
depleted.



<PAGE>


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

         A foreign exchange gain of $187,000 was recorded in 1998, compared with
a gain of $46,000 on the Company's  U.S.  investments in 1997. In 1998, the gain
was  attributable  to a  strengthening  of the U.S.  dollar as  compared  to the
Canadian  dollar on the  Company's  U.S.  investments.  The Canadian  dollar was
equivalent to U.S.
$.6992 at December 31, 1997 compared to U.S. $.6528 at September 30, 1998.

         Income taxes. No provision for income taxes is required for the current
period.

Item 3.  Quantitative and Qualitative Disclosure About Market Risk

         The information  required by this item is not applicable to the Company
because  the  Company  does not own any market risk  sensitive  instruments.  At
September 30, 1998, the value of the Canadian dollar relative to the U.S. dollar
decreased 7% compared to its value on December 31, 1997.



<PAGE>



                         CANADA SOUTHERN PETROLEUM LTD.

                           PART II - OTHER INFORMATION

                               September 30, 1998

Item 6.  Exhibits and Reports on Form 8-K

          (a)     Exhibits

                  None.

          (b)     Reports on Form 8-K

                  1.       On July 1, 1998,  the Company filed a Current  Report
                           on Form 8-K to report that (1) the  Kotaneelee  trial
                           had  adjourned  until  September  8, 1998 and (2) the
                           B-38 well in the  Kotaneelee  gas field would undergo
                           remedial  work to  correct a  wellsite  problem at an
                           estimated cost between $1-8 million (Cdn.).

                  2.       On September 18, 1998,  the Company  filed a  Current
                           Report on Form 8-K to  report  that the  Company  had
                           completed the  presentation of its case against Amoco
                           Canada and several other  partners in the  Kotaneelee
                           gas field and  presented  evidence  that the  Company
                           sustained  monetary  damages  of  approximately  $100
                           million.



<PAGE>


                                   SIGNATURES




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



                                            CANADA SOUTHERN PETROLEUM LTD.
                                                          Registrant




Date:  November 10, 1998                    By /s/ Kelly B. Johnson
                                               Treasurer and Chief Financial and
                                               Accounting Officer