**FORM      10-Q/A-1**

**Tri-Valley      Corporation**

**                Delaware**
**84-0617433**

**4550      California Avenue, Suite 600, Bakersfield, California      93309**

**(661)      864-0500 **

**TRI-VALLEY      CORPORATION**

**INTRODUCTORY      STATEMENT**

| ·   | Note                7 to the Consolidated Financial Statements has been revised to include                a                description of each or our industry                segments. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Management’s                Discussion and Analysis of Financial Condition and Results of Operations                has been revised to include a discussion of results by industry                segment. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The                Controls and Procedures discussion was expanded to discuss our efforts                to                remediate material weaknesses in our internal control over financial                reporting during the first quarter. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**INDEX**

|                     |                                                                      | Page   |   |
|--------------------------|---------------------------------------------------------------------------|--------|--------|
|                     |                                                                      |   |   |
| PART                I -  | FINANCIAL                INFORMATION                                      | 3      |   |
|                     |                                                                      |   |   |
| Item                1.   | Consolidated                Financial Statements                          | 3      |   |
|                     |                                                                      |   |   |
| Item                2.   | Management's                Discussion and Analysis of Financial          |   |   |
|                     | Condition                and Results of Operations                        | 15     |   |
|                     |                                                                      |   |   |
| Item                3.   | Quantitative                and Qualitative Disclosures about Market Risk | 19     |   |
|                     |                                                                      |   |   |
| Item                4.   | Controls                and Procedures                                    | 19     |   |
|                     |                                                                      |   |   |
| PART                II - | OTHER                INFORMATION                                          | 20     |   |
|                     |                                                                      |   |   |
| Item                1A.  | Risk                Factors                                               | 20     |   |
|                     |                                                                      |   |   |
| Item                2.   | Unregistered                Sales of Equity Securities                    | 20     |   |
|                     |                                                                      |   |   |
| Item                6.   | Exhibits                                                                  | 20     |   |
|                     |                                                                      |   |   |
| SIGNATURES               |                                                                      | 21     |   |
|                     |                                                                      |   |   |

----

**PART      I**

**FINANCIAL      INFORMATION**

**TRI-VALLEY      CORPORATION**

**CONSOLIDATED      BALANCE SHEETS**

**ASSETS**

|                                             |   | March                31, |       | December                31, |   |
|--------------------------------------------------|--------|--------------------------|------------|-----------------------------|--------|
|                                             |   | 2007                     |       | 2006                        |   |
|                                             |   | (Unaudited)              |       | (Audited)                   |   |
|                                             |   |                     |       |                        |   |
| Current                assets                    |   |                     |       |                        |   |
| Cash                                             |   | $                        | 19,676,160 |                        | $      | 15,598,215 |   |
| Accounts                receivable, trade        |   |                     | 808,062    |                        |   | 377,278 |   |
| Prepaid                expenses                  |   |                     | 262,194    |                        |   | 42,529 |   |
|                                             |   |                     |       |                        |   |   |   |
| Total                current assets              |   |                     | 20,746,416 |                        |   | 16,018,022 |   |
|                                             |   |                     |       |                        |   |   |   |
| Property                and equipment, net       |   |                     |       |                        |   |   |   |
| Proved                properties                 |   |                     | 1,371,959  |                        |   | 1,407,925 |   |
| Unproved                properties               |   |                     | 2,627,064  |                        |   | 2,792,340 |   |
| Rigs                                             |   |                     | 5,740,748  |                        |   | 5,371,593 |   |
| Other                property and equipment      |   |                     | 2,923,182  |                        |   | 2,504,185 |   |
|                                             |   |                     |       |                        |   |   |   |
| Total                property and equipment, net |   |                     | 12,662,953 |                        |   | 12,076,043 |   |
|                                             |   |                     |       |                        |   |   |   |
| Other                assets                      |   |                     |       |                        |   |   |   |
| Deposits                                         |   |                     | 309,833    |                        |   | 309,833 |   |
| Investments                in partnerships       |   |                     | 17,400     |                        |   | 17,400 |   |
| Goodwill                                         |   |                     | 212,414    |                        |   | 212,414 |   |
| Other                                            |   |                     | 20,413     |                        |   | 20,413 |   |
|                                             |   |                     |       |                        |   |   |   |
| Total                other assets                |   |                     | 560,060    |                        |   | 560,060 |   |
|                                             |   |                     |       |                        |   |   |   |
| **Total                assets**                  |   | $                        | 33,969,429 |                        | $      | 28,654,125 |   |

----

**LIABILITIES      AND STOCKHOLDERS' EQUITY**

|                                                                                                                                            |   | March                31, |        | December                31, |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------|-------------|-----------------------------|--------|
|                                                                                                                                            |   | 2007                     |        | 2006                        |   |
|                                                                                                                                            |   | (Unaudited)              |        | (Audited)                   |   |
| Current                liabilities                                                                                                              |   |                     |        |                        |   |
| Notes                payable                                                                                                                    |   | $                        | 546,927     |                        | $      | 619,069 |   |
| Notes                payable - related parties                                                                                                  |   |                     | 38,656      |                        |   | 501,036 |   |
| Accounts                payable and accrued expenses                                                                                            |   |                     | 3,322,228   |                        |   | 2,237,116 |   |
| Amounts                payable to joint venture participants                                                                                    |   |                     | 115,184     |                        |   | 280,815 |   |
| Advances                from joint venture participants, net                                                                                    |   |                     | 6,877,053   |                        |   | 5,408,909 |   |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| Total                current liabilities                                                                                                        |   |                     | 10,900,048  |                        |   | 9,046,945 |   |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| Non-Current                Liabilities                                                                                                          |   |                     |        |                        |   |   |   |
| Asset                retirement obligation                                                                                                      |   |                     | 222,714     |                        |   | 216,714 |   |
| Long-term                portion of notes payable - related parties                                                                             |   |                     | 685,556     |                        |   | 698,963 |   |
| Long-term                portion of notes payable                                                                                               |   |                     | 2,015,963   |                        |   | 2,047,885 |   |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| Total                non-current liabilities                                                                                                    |   |                     | 2,924,233   |                        |   | 2,963,562 |   |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| Total                liabilities                                                                                                                |   |                     | 13,824,281  |                        |   | 12,010,507 |   |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| Stockholders'                equity                                                                                                             |   |                     |        |                        |   |   |   |
| Common                stock, $.001 par value; 100,000,000 shares                                                                                |   |                     |        |                        |   |   |   |
| authorized;                24,537,251 and 23,546,655 issued and                                                                                 |   |                     |        |                        |   |   |   |
| outstanding                at March 31, 2007, and December 31,                                                                                  |   |                     |        |                        |   |   |   |
| 2006,                respectively                                                                                                               |   |                     | 24,397      |                        |   | 23,407 |   |
| Less:                common stock in treasury, at cost,                                                                                         |   |                     |        |                        |   |   |   |
| 100,025                shares                                                                                                                   |   |                     | (13,370     | )                           |   | (13,370 | ) |
| Capital                in excess of par value                                                                                                   |   |                     | 34,247,474  |                        |   | 28,692,780 |   |
| Additional                paid in capital - warrants                                                                                            |   |                     | 706,159     |                        |   | 247,313 |   |
| Additional                paid in capital - stock options                                                                                       |   |                     | 1,400,553   |                        |   | 1,262,404 |   |
| Additional                paid in capital - Great Valley Drilling Company, LLC and Great Valley                Production Services Company, LLC |   |                     | 5,042,967   |                        |   | 5,438,087 |   |
| Accumulated                deficit                                                                                                              |   |                     | (21,263,032 | )                           |   | (19,007,003 | ) |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| Total                stockholders' equity                                                                                                       |   |                     | 20,145,148  |                        |   | 16,643,618 |   |
|                                                                                                                                            |   |                     |        |                        |   |   |   |
| **Total                liabilities and stockholder's equity**                                                                                   |   | $                        | 33,969,429  |                        | $      | 28,654,125 |   |

----

**TRI-VALLEY      CORPORATION**

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

|                                                                                                          |   | For                the Three Months |       |
|---------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|------------|
|                                                                                                          |   | Ended                March 31       |       |
|                                                                                                          |   | 2007                                |       | 2006 |   |
| Revenues                                                                                                      |   |                                |       |   |   |
| Sale                of oil and gas                                                                            |   | $                                   | 164,186    |   | $ | 318,722 |   |
| Rig                income                                                                                     |   |                                | 1,250,503  |   |   | - |   |
| Other                income                                                                                   |   |                                | 101,611    |   |   | 38,448 |   |
| Interest                income                                                                                |   |                                | 94,067     |   |   | 6,857 |   |
|                                                                                                          |   |                                |       |   |   |   |   |
| Total                Revenues                                                                                 |   |                                | 1,610,367  |   |   | 364,027 |   |
|                                                                                                          |   |                                |       |   |   |   |   |
| Costs                and expenses                                                                             |   |                                |       |   |   |   |   |
| Oil                and gas lease expense                                                                      |   |                                | 88,395     |   |   | 57,414 |   |
| Mining                exploration expenses                                                                    |   |                                | 63,456     |   |   | 200,586 |   |
| Drilling                and development                                                                       |   |                                | 232,496    |   |   | 42,561 |   |
| Rig                operations                                                                                 |   |                                | 444,558    |   |   | - |   |
| Depletion,                depreciation and amortization                                                       |   |                                | 253,123    |   |   | 111,668 |   |
| Interest                                                                                                      |   |                                | 76,896     |   |   | 83,041 |   |
| Impairment                loss                                                                                |   |                                | 246,862    |   |   | 458,564 |   |
| General                and administrative                                                                     |   |                                | 2,460,610  |   |   | 905,913 |   |
|                                                                                                          |   |                                |       |   |   |   |   |
| Total                costs and expenses                                                                       |   |                                | 3,866,396  |   |   | 1,859,747 |   |
|                                                                                                          |   |                                |       |   |   |   |   |
| Loss                from continuing operations, before income taxes anddiscontinued                operations |   |                                | (2,256,029 | ) |   | (1,495,720 | ) |
| Tax                provision                                                                                  |   |                                | -          |   |   | - |   |
|                                                                                                          |   |                                |       |   |   |   |   |
| Loss                from continuing operations, before discontinued                                           |   |                                |       |   |   |   |   |
| operations                                                                                                    |   |                                | (2,256,029 | ) |   | (1,495,720 | ) |
|                                                                                                          |   |                                |       |   |   |   |   |
| Loss                from discontinued operations                                                              |   |                                | -          |   |   | (1,568,387 | ) |
|                                                                                                          |   |                                |       |   |   |   |   |
| Net                Income (Loss)                                                                              |   | $                                   | (2,256,029 | ) | $ | (3,064,107 | ) |
|                                                                                                          |   |                                |       |   |   |   |   |
| Basic                net loss per share:                                                                      |   |                                |       |   |   |   |   |
| Loss                from continuing operations                                                                |   | $                                   | (.09       | ) | $ | (.06 | ) |
| Income                (loss) from discontinued operations, net                                                |   | $                                   | -          |   | $ | (.07 | ) |
| Basic                loss per common share                                                                    |   | $                                   | (.09       | ) | $ | (.13 | ) |
|                                                                                                          |   |                                |       |   |   |   |   |
| Weighted                average number of shares outstanding                                                  |   |                                | 24,537,251 |   |   | 22,938,902 |   |
|                                                                                                          |   |                                |       |   |   |   |   |
| Potentially                dilutive shares outstanding                                                        |   |                                | 27,608,334 |   |   | 25,660,058 |   |

----

**TRI-VALLEY      CORPORATION**

**CONSOLIDATED      STATEMENTS OF CASH FLOWS**

|                                                                                                                       |   | For                the Three Months |       |
|----------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|------------|
|                                                                                                                       |   | Ended                March 31,      |       |
|                                                                                                                       |   | 2007                                |       | 2006 |   |
| Cash                Flows from Operating Activities                                                                        |   |                                |       |   |   |
| Net                loss                                                                                                    |   | $                                   | (2,256,029 | ) | $ | (3,064,107 | ) |
| Loss                from discontinued operations                                                                           |   |                                | -          |   |   | (1,568,387 | ) |
| Loss                from continuing operations                                                                             |   | $                                   | (2,256,029 | ) |   | (1,495,720 | ) |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Adjustments                to reconcile net income to net cash used from operating                activities:              |   |                                |       |   |   |   |   |
| Depreciation,                depletion and amortization                                                                    |   |                                | 253,123    |   |   | 111,668 |   |
| Impairment,                dry hole and other disposals of property                                                        |   |                                | 252,862    |   |   | 458,564 |   |
| Stock                options                                                                                               |   |                                | 138,149    |   |   | - |   |
| Warrants                                                                                                                   |   |                                | 458,846    |   |   | - |   |
| Changes                in operating capital:                                                                               |   |                                |       |   |   |   |   |
| Prepaids-(increase)                decrease                                                                                |   |                                | (219,665   | ) |   | - |   |
| Deposits-(increase)                decrease                                                                                |   |                                | -          |   |   | (109,483 | ) |
| Accounts                receivable-(increase) decrease                                                                     |   |                                | (430,785   | ) |   | (320,821 | ) |
| Trade                accounts payable-increase (decrease)                                                                  |   |                                | 550,590    |   |   | 215,603 |   |
| Advances                from Great Valley Drilling, LLC-increase (decrease)                                                |   |                                | -          |   |   | 748,000 |   |
| Accounts                payable to joint venture                                                                           |   |                                |       |   |   |   |   |
| participants                and related parties-increase (decrease)                                                        |   |                                | (165,631   | ) |   | 273,139 |   |
| Advances                from joint venture participants - increase (decrease)                                              |   |                                | 1,468,144  |   |   | 109,552 |   |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Net                cash provided (used in) continuing operations                                                           |   |                                | 49,604     |   |   | (9,498 | ) |
| Net                cash provided by (used in) discontinued operations                                                      |   |                                | -          |   |   | (1,155,817 | ) |
| Net                cash provided (used) by operating activities                                                            |   |                                | 49,604     |   |   | (1,165,315 | ) |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Cash                Flows from Investing Activities:                                                                       |   |                                |       |   |   |   |   |
| Capital                expenditures                                                                                        |   |                                | (1,086,894 | ) |   | (1,655,315 | ) |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Net                cash provided by (used in) continuing operations                                                        |   |                                | (1,086,894 | ) |   | (499,044 | ) |
| Net                cash provided by (used in) discontinued operations                                                      |   |                                | -          |   |   | (1,156,271 | ) |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Net                Cash Provided (Used) by Investing Activities                                                            |   |                                | (1,086,894 | ) |   | (1,655,315 | ) |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Cash                Flows from Financing Activities                                                                        |   |                                |       |   |   |   |   |
| Proceeds                from long-term debt                                                                                |   |                                | -          |   |   | 1,268,755 |   |
| Principal                payments on long-term debt                                                                        |   |                                | (45,329    | ) |   | (214,312 | ) |
| Net                proceeds from additional paid in capital - stock options                                                |   |                                | 138,149    |   |   | 52,060 |   |
| Net                proceeds from additional paid in capital - warrants                                                     |   |                                | 458,846    |   |   | - |   |
| Net                proceeds from additional paid in capital - Great Valley Drilling/Great                Valley Production |   |                                | (395,120   | ) |   | - |   |
| Stock                issuance costs                                                                                        |   |                                | (706,875   | ) |   | - |   |
| Proceeds                from issuance of common stock                                                                      |   |                                | 5,665,564  |   |   | 617,832 |   |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Net                cash provided by (used in) continuing operations                                                        |   |                                | 5,115,235  |   |   | 1,724,335 |   |
| Net                cash provided by (used in) discontinued operations                                                      |   |                                | -          |   |   | - |   |
|                                                                                                                       |   |                                |       |   |   |   |   |
| Net                Cash Provided (Used) by Financing Activities                                                            |   |                                | 5,115,235  |   |   | 1,724,335 |   |

----

**TRI-VALLEY      CORPORATION**

**CONSOLIDATED      STATEMENTS OF CASH FLOWS (Continued)**

|                                                                  |   |   |       |   |   |
|-----------------------------------------------------------------------|--------|--------|------------|--------|--------|
| Net                Increase in Cash and Cash Equivalents              |   |   | 4,077,945  |   |   | 59,522 |   |
| Cash                and Cash Equivalents at Beginning of Period  |   |   | 15,598,215 |   |   | 4,876,921 |   |
|                                                                  |   |   |       |   |   |   |   |
| Cash                and Cash Equivalents at End of Period             |   | $      | 19,676,160 |   | $      | 4,936,443 |   |
|                                                                  |   |   |       |   |   |   |   |
| Supplemental                Information:                              |   |   |       |   |   |   |   |
| Cash                paid for interest                                 |   | $      | 76,896     |   | $      | 155,841 |   |
| Cash                paid for taxes                                    |   | $      | -          |   | $      | - |   |

----

**TRI-VALLEY      CORPORATION**

**NOTES      TO CONDENSED FINANCIAL STATEMENTS**

**FOR      THE THREE MONTHS ENDED**

**March      31, 2007 and 2006**

**NOTE      1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION**

| ·   | Tri-Valley                Oil & Gas Company (“TVOG”) operates the oil & gas activities. TVOG                derives the majority of its revenue from oil and gas drilling and                turnkey                development. TVOG primarily generates its own exploration prospects                from                its internal database, and also screens prospects from other geologists                and companies. TVOG generates these geological “plays” within a certain                geographic area of mutual interest. The prospect is then presented                to                potential co-ventures. The company deals with both accredited individual                investors and energy industry companies. TVOG serves as the operator                of                these co-ventures. TVOG operates both the oil and gas production                segment                and the drilling and development segment of our business                lines. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Select                Resources Corporation (“Select”) was created in late 2004 to manage, grow                and operate Tri-Valley’s mineral interests. Select operates the minerals                segment of our business lines. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Great                Valley Production Services, LLC, (“GVPS”) was formed in 2006 to operate                oil production services, well work over and drilling rigs, primarily                for                TVOG. However, from time to time TVOG may contract various units                to third                parties when not immediately needed for TVOG projects. Tri-Valley                has sold                49% of the ownership interest to private parties and has retained                a 51%                ownership interest in this subsidiary. Operations began in the third                quarter of 2006. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Great                Valley Drilling Company, LLC (“GVDC”) was formed in 2006 to operate oil                drilling rigs, primarily in Nevada where Tri-Valley has 17,000 acres                of                prospective oil leases. However, because rig availability is so extremely                scarce in Nevada, GVDC has an exceptional opportunity to do contract                drilling for third parties in both petroleum and geothermal projects.                For                the time being GVDC, whose operation began in the first quarter of                2007,                expects its primary activity will be contract drilling for third                parties.                Tri-Valley has sold 49% of the ownership interest to private parties                and                has retained a 51% ownership interest in this subsidiary. TVC is                exercising its option to buy back the minority interest in GVDC and                expects to be finalized by the end of June 2007, at which time GVDC                will                be 100% owned by TVC. The repurchase cost is expected to be about                $1.7                million. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Tri-Valley                Power Corporation is inactive at the present                time. |
|--------------------|---------------------------------------------------------------------------------------------|

**NOTE      2 - PER SHARE COMPUTATIONS**

**NOTE      3 - SUMMARY OF RECENTLY ISSUED ACCOUNTING PRONOUCEMENTS**

*“Accounting      for Conditional Asset Retirement Obligations”*
*“Accounting      for Asset Retirement Obligations”, *

*Accounting      Changes and Error Corrections*

----

**NOTE      3 - Recently Issued Accounting Pronouncements (Continued)**

*“Accounting      for Uncertainty in Income Taxes*

*“Fair      Value Measurements.”*

*Considering      the Effects of Prior Year Misstatements when Quantifying Misstatements in      Current Year Financial Statements*

*The      Fair Value Option for Financial Assets and Financial      Liabilities*

----

**NOTE      4 - NOTES PAYABLE**

**NOTE      5 - CHANGES IN SECURITIES**

*Accounting      for Convertible Debt and Debt issued with Stock Purchase Warrants (APB14)*
*Accounting      for Convertible Securities with Beneficial Conversion Features or Contingently      Adjustable Conversion Ratios, (EITF 98-5) *
*Application      of Issue No 98-5 to Certain Convertible Instruments and (EITF 00-27.*
      convertible instruments using the Black-Scholes valuation method, using the      same      assumptions used for valuing employee options for purposes of SFAS No. 123R,      except that the expected life of the warrant is used. * *Under      these guidelines, the Company allocates the value of the proceeds received.      The      price allocated for the warrants is calculated by subtracting the current market      price of the stock from the total proceeds of the sale of the restricted stock      with the warrant attached. The allocated fair value is recorded as capital      paid      in - warrants. This allocated fair value of the proceeds from the sale of      warrants is subtracted from the value of the warrants using the Black-Scholes      valuation method to calculate the stock issuance expense. 

**NOTE      6 - STOCK BASED COMPENSATION EXPENSE**

----

**NOTE      6 - STOCK BASED COMPENSATION EXPENSE (Continued)**

**NOTE      7 - FINANCIAL INFORMATION RELATING TO INDUSTRY SEGMENTS**

*“Disclosure      about Segments of an Enterprise and Related Information”.*

| The                Company’s operations are classified into four principal industry                segments: |
|--------------------------------------------------------------------------------------------------------------------|
|                                                                                                               |   |
| -                                                                                                                  | *Oil                and gas operations*                include our share of revenues from oil and gas wells on which TVOG                serves                as operator, royalty income and production revenue from other partnerships                in which we have operating or non-operating interests. It also includes                revenues for consulting services for oil and gas related                activities. |
|                                                                                                               |   |
| -                                                                                                                  | *Rig                operations*                began in 2006, when the Company acquired drilling rigs and began                operating                them through subsidiaries GVPS and GVDC. Rig operations include income                from rental of oil field equipment. |
|                                                                                                               |   |
| -                                                                                                                  | *Minerals*                include the Company’s mining and mineral prospects and operations, and                expenses associated with those operations. In 2006, the Company recorded                minerals revenue from consulting services performed for the mining                and                minerals industry, which are included on the operating statement                as other                income. |
|                                                                                                               |   |
| -                                                                                                                  | *Drilling                and development*                includes revenues received from oil and gas drilling and development                operations performed for joint venture partners, including the Opus-I                drilling partnership. |

|                                                     |   |  Three                Months Ended March 31, 2007 |       | Three                Months Ended March 31, 2006 |   |
|----------------------------------------------------------|--------|--------------------------------------------------------|------------|--------------------------------------------------|--------|
|                                                     |   |                                              |       |                                             |   |
| **Sales                and Other Operating Revenues**    |   |                                              |       |                                             |   |
| Oil                & Gas                             |   | $                                                      | 292,447    |                                             | $      | 357,289 |   |
| Rigs                                                     |   |                                                   | 1,313,099  |                                             |   | - |   |
| Minerals                                                 |   |                                                   | 4,821      |                                             |   | 6,738 |   |
| Drilling                and Development                  |   |                                                   | -          |                                             |   | - |   |
|                                                     |   |                                                   |       |                                             |   |   |   |
| Consolidated                Sales and Operating Revenues |   |                                                   | 1,610,367  |                                             |   | 364,027 |   |
|                                                     |   |                                                   |       |                                             |   |   |   |
|                                                     |   |                                                   |       |                                             |   |   |   |
| **Net                Income (Loss)**                     |   |                                                   |       |                                             |   |   |   |
| Oil                & Gas                             |   | $                                                      | (2,229,540 | )                                                | $      | (1,087,475 | ) |
| Rigs                                                     |   |                                                   | 303,409    |                                             |   | - |   |
| Minerals                                                 |   |                                                   | (329,898   | )                                                |   | (1,976,632 | ) |
| Drilling                and Development                  |   |                                                   | -          |                                             |   | - |   |
|                                                     |   |                                                   |       |                                             |   |   |   |
| Consolidated                Net Income (Loss)            |   | $                                                      | (2,256,029 | )                                                | $      | (3,064,107 | ) |

----

|                                     |   |  March                31, 2007 |       | December                31, 2006 |   |
|------------------------------------------|--------|-------------------------------------|------------|----------------------------------|--------|
|                                     |   |                           |       |                             |   |
| **Total                Assets**          |   |                           |       |                             |   |
| Oil                & Gas             |   | $                                   | 23,000,692 |                             | $      | 18,517,488 |   |
| Rigs                                     |   |                                | 8,786,068  |                             |   | 7,853,046 |   |
| Minerals                                 |   |                                | 2,182,669  |                             |   | 2,283,591 |   |
| Drilling                and Development  |   |                                | -          |                             |   | - |   |
|                                     |   |                                |       |                             |   |   |   |
| Consolidated                Total Assets |   | $                                   | 33,969,429 |                             | $      | 28,654,125 |   |
|                                     |   |                                |       |                             |   |   |   |

**NOTE      8 -**
**      INCOME TAXES**

|                                             |   | December                31, |       | March                31, |   |
|--------------------------------------------------|--------|-----------------------------|------------|--------------------------|--------|
|                                             |   | 2006                        |       | 2007                     |   |
|                                             |   |                        |       |                     |   |
| Deferred                tax assets:              |   |                        |       |                     |   |
| Net                operating loss carryforwards  |   | $                           | 5,398,000  |                     | $      | 5,520,000 |   |
| Statutory                depletion carryforwards |   |                        | 496,000    |                     |   | 496,000 |   |
|                                             |   |                        |       |                     |   |   |   |
| Total                deferred tax assets         |   |                        | 5,894,000  |                     |   | 6,016,000 |   |
| Valuation                allowance               |   |                        | (5,894,000 | )                        |   | (6,016,000 | ) |
|                                             |   |                        |       |                     |   |   |   |
| **Net                deferred tax assets**       |   | **$**                       | **-**      |                     | **$**  | **-** |   |

|                                                                     |   | December                31, |     | March                31, |   |
|--------------------------------------------------------------------------|--------|-----------------------------|----------|--------------------------|--------|
|                                                                     |   | 2006                        |     | 2006                     |   |
| Income                (loss) before tax                                  |   | $                           | (940,512 | )                        | $      | (2,256,029 | ) |
|                                                                     |   |                        |     |                     |   |   |   |
| Computed                "expected" tax (benefit)                         |   | $                           | (376,000 | )                        | $      | (902,000 | ) |
| State                tax liability                                       |   |                        | -        |                     |   | - |   |
|                                                                     |   |                        |     |                     |   |   |   |
| Utilization                (non-utilization) of operating loss carryover |   |                        | 376,000  |                     |   | 902,000 |   |
| **Total                income tax provision**                            |   | **$**                       | **-**    |                     | **$**  | **-** |   |

**NOTE      9 - SUBSEQUENT EVENTS**

----

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

**Notice      Regarding Forward-Looking Statements**

**Results      of Operations**

|                                    | Three                MonthsEnded                March31,                2007 | Three                MonthsEnded                March31,                2006 |
|-----------------------------------------|------------------------------------------------------------------------------|------------------------------------------------------------------------------|
|                                    | $                                                                            | %                                                                            | $ | % |
| Oil                and gas              | $   292                                                       | 18%                                                                          | $   357 | 98% |
| Rig                operations           | 1,313                                                                        | 82%                                                                          | -  | -    |
| Minerals                                | 5                                                                            | -                                                             | 7 | 2% |
| Drilling                and development | -                                                                       | -                                                             | -  | -    |
|                                    |                                                                         |                                                                         |   |   |
| Total                revenues           | $1,610                                                                       | 100%                                                                         | $   364 | 100% |

*Oil      and Gas*

*Rig      Operations*

*Mining      Activities*

*Drilling      and Development Operations*

|                                         | Quarter                Ended 3/31/07 | Quarter                Ended 3/31/06 |
|----------------------------------------------|--------------------------------------|--------------------------------------|
|                                         |                                 |                                 |
| Oil                and gas                   | $                (2,230)             | $                (1,187)             |
| Rig                operations                | 303                             | -                               |
| Minerals                                     | (330)                                | (1,977)                              |
| Drilling                and development      | -                               | -                               |
|                                         |                                 |                                 |
| Total                operating income (loss) | $                (2,256)             | $                (3,064)             |

----

**Item      3. Quantitative and Qualitative Disclosures about Market      Risk**

**Item      4. Controls and Procedures**

| o   | Proved                and unproved properties |
|---------------|-----------------------------------------------|

| o   | Deferred                income taxes; |
|---------------|---------------------------------------|

| o   | Complete                a review, update and risk assessment of all of our financial controls                and                procedures; |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------|

| o   | Provide                additional training of financial                staff; |
|---------------|-------------------------------------------------------------------------------|

| o   | Purchase                additional research materials and services;                and |
|---------------|----------------------------------------------------------------------------------------|

| o   | Shorten                the financial closing process to allow more time for a thorough                review |
|---------------|--------------------------------------------------------------------------------------------------------------|

| o   | Improve                the reporting disclosure and the formulation of deferred                taxes |
|---------------|------------------------------------------------------------------------------------------------------|

**PART      II - OTHER INFORMATION**

**Item      1A. **
**Risk      Factors**

**Item      2. Unregistered Sales of Equity Securities**

**Item      6. Exhibits**

----

**Signatures**

**TRI-VALLEY      CORPORATION**

*/s/F.      Lynn Blystone*

*/s/      Arthur M. Evans*