UNITED
        STATES
 SECURITIES
        AND EXCHANGE COMMISSION
 WASHINGTON,
        D.C. 20549
 
 FORM
        10-QSB/A
 (Amendment
          No. 1)
 
 x
              Quarterly
                  Report pursuant to Section 13 or 15(d) of the Securities Exchange
                  Act of
                  1934
                For
                  the fiscal quarter ended September 30,
                  2007
 
 Transition
        Report under Section 13 or 15(d) of the Securities Exchange Act of
        1934.
 For
        the
        transition period from _____ to _____.
 
 Commission
        File No. 0-26669
 
 Can-Cal
        Resources Ltd.
 (Name
        of
        Small Business Issuer in its charter)
  Nevada
              
              88-0336988(State
                  or other jurisdiction of incorporation or organization)
              
              (I.R.S.
                  Employer Identification No.)
  2500
        Vista Mar Drive, Las Vegas, NV 89128
 (Address
        of principal executive offices)
 
 (702)
        243-1849
 (Issuer's
        telephone number)
 
 N/A
 (Former
        name, former address and former fiscal year,
 if
        changed since last report)
 
 Check
        whether the issuer (1) filed all reports required to be filed by Section
        13 or
        15(d) of the Exchange Act during the past 12 months (or for such shorter
        period
        that the registrant was required to file such reports), and (2) has been
        subject
        to such filing requirements for the past 90 days. Yes x No o
 
 APPLICABLE
        ONLY TO CORPORATE ISSUERS
 
 State
        the
        number of shares outstanding of each of the issuer's classes of common equity,
        as of the latest practicable date:
  Class
              
              Outstanding
                  as of November 13, 2007Common
                  Stock, Par Value $.001.
              
              24,362,538
 
 Transitional
        Small Business Disclosure Format (Check one): Yes o No x
  
  EXPLANATORY
        NOTE
  This
        quarterly report on Form 10-QSB/A (“Form 10-QSB/A”) for the period ending
        September 30, 2007 is filed to amend the following:
  ·
              Balance
                  Sheet within item 1 of Part I, as well as, all related footnotes
                  and
                  references thereto, in order to restate the correction of an error
                  as
                  explained in Note 2 of the Notes to the Financial
                  Statements.
 ·
              Item
                  3 of Part I to revise the wording concerning management’s evaluation and
                  attestation over the Company’s disclosure
                  controls.
  Events
        have taken place that would have been reflected in the original Form 10-QSB
        if
        they had taken place prior to the date of the original and amended filings.
        The
        Company recommends this report be read in conjunction with the Company’s reports
        filed subsequent to November 14, 2007.
  
  CONTENTS
  PAGE
                  NO.PART
                  I.
              FINANCIAL
                  INFORMATIONITEM
                  1.
              FINANCIAL
                  STATEMENTSBalance
                  Sheet (unaudited)
              3Statements
                  of Operations (unaudited)
              4Statements
                  of Cash Flows (unaudited)
              5Notes
                  to Financial Statements (unaudited)
              6ITEM
                  2.
              Management's
                  Discussion and Analysis of Financial
                  Condition
              8ITEM
                  3.
              Controls
                  and Procedures
              12PART
                  II.
              OTHER
                  INFORMATIONITEM
                  1.
              Legal
                  Proceedings
              13ITEM
                  2.
              Changes
                  in Securities
              13ITEM
                  3.
              Defaults
                  Upon Senior Securities
              13ITEM
                  4.
              Submission
                  of Matters to a Vote of Security Holders
              13ITEM
                  5.
              Other
                  information
              13ITEM
                  6.
              Exhibits
                  and Reports on Form 8-K
              13Signatures
              14Certifications
  1
 
 FORWARD
        LOOKING STATEMENTS
 
 Section
        27A of the Securities Act of 1933 and Section 21E of the Securities Exchange
        Act
        of 1934 provide a "safe harbor" for forward looking statements that are based
        on
        current expectations, estimates and projections, and management's beliefs
        and
        assumptions. Words such as "believes," "expects," "intends," "plans,"
        "estimates," "may," "attempt," "will," "goal," "promising," or variations
        of
        such words and similar expressions are intended to identify such forward-looking
        statements. These statements are not guarantees of future performance and
        involve certain risks and uncertainties which are difficult or impossible
        to
        predict. Therefore, actual outcomes and results may differ materially from
        what
        is expressed or forecasted in such forward-looking statements. The Company
        undertakes no obligation to update publicly any forward-looking statement
        whether as a result of new information, future events or otherwise.
 
 Such
        risks and uncertainties include, but are not limited to, the availability
        of
        metal ore; negative or inconsistent test results, the existence of precious
        metals in the metal ore available to the Company in an amount which permits
        their production on an economic basis; the Company's ability to drill holes
        and
        properly test and assay samples, and its ability to locate and acquire mineral
        properties which contain sufficient grades of precious metals and/or minerals;
        the Company's ability to sell a portion or all of any of its properties to
        larger mining companies, or to enter into agreements with larger mining
        companies to explore and possibly develop its properties; to produce precious
        metals on a commercial basis, the prices of precious metals; obtaining a
        mill or
        refinery to extract precious metals on an economic basis; the ability to
        maintain the facilities it currently utilizes; obtain permitting requirements
        for any mining and milling operations and pay the costs thereof; have good
        title
        to claims and equipment; and the Company's ability to obtain financing necessary
        to maintain its operations.
  2
  PART
        I.
        FINANCIAL INFORMATION
 
 ITEM
        1.
        FINANCIAL STATEMENTS
 CAN-CAL
          RESOURCES LTD
 BALANCE
          SHEET
 (UNAUDITED)
 
 September 30,2007ASSETSCurrent
                    assetsCash
                
                $
                230,932Total
                    current assets
                
                
                230,932Fixed
                    assets, net
                
                
                40,191Other
                    assets, net
                
                
                455,667Total
                    assets
                
                $
                726,790LIABILITIES
                    AND STOCKHOLDERS' DEFICITCurrent
                    liabilitiesAccounts
                    payable
                
                $
                22,227Accrued
                    interest
                
                
                297,810Accrued
                    officer salary payable
                
                
                111,436Accrued
                    payroll taxes
                
                
                68,587Notes
                    payable, related parties
                
                
                360,550Unearned
                    revenues
                
                
                15,000Total
                    current liabilities
                
                
                875,610Stockholders'
                    deficitPreferred
                    stock; $0.001 par value; 10,000,000 sharesauthorized,
                    no shares issued and outstanding
                
                
                -Common
                    stock; $0.001 par value; 100,000,000 sharesauthorized,
                    24,360,541 shares issued and outstanding
                
                
                24,361Additional
                    paid-in capital
                
                
                7,728,752Accumulated
                    deficit
                
                
                (7,901,933
                )Total
                    stockholders' deficit
                
                
                (148,820
                )Total
                    liabilities and stockholders' deficit
                
                $
                726,790
 
 See
          Accompanying Notes to Financial Statements
  3
  CAN-CAL
          RESOURCES LTD
 STATEMENTS
          OF OPERATIONS
 (UNAUDITED)
 
 For the Three Months Ended
                
                For the Nine Months EndedSeptember 30,
                
                September 30,2007
                
                2006
                
                2007
                
                2006Material
                    sales
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -Cost
                    of sales
                
                
                -
                
                
                -
                
                
                -
                
                
                -Gross
                    profit
                
                
                -
                
                
                -
                
                
                -
                
                
                -ExpensesExploration
                    costs
                
                
                46,588
                
                
                12,100
                
                
                149,532
                
                
                22,800Depreciation
                
                
                1,277
                
                
                1,700
                
                
                7,297
                
                
                4,800General
                    and administrative expenses
                
                
                64,631
                
                
                79,000
                
                
                173,375
                
                
                167,200General
                    and administrative expenses - related party
                
                
                30,942
                
                
                97,800
                
                
                92,994
                
                
                272,100Total
                    operating expenses
                
                
                143,438
                
                
                190,600
                
                
                423,198
                
                
                466,900Loss
                    from operations
                
                
                (143,438
                )
                
                (190,600
                )
                
                (423,198
                )
                
                (466,900
                )Other
                    income (expense)Beneficial
                    conversion discount
                
                
                -
                
                
                (4,200
                )
                
                -
                
                
                (25,200
                )Interest
                    income
                
                
                2,387
                
                
                -
                
                
                9,346
                
                
                100Gain
                    on disposal of fixed assets
                
                
                -
                
                
                -
                
                
                3,701
                
                
                -Rental
                    revenue
                
                
                5,625
                
                
                5,600
                
                
                16,875
                
                
                42,900Interest
                    expense
                
                
                (14,169
                )
                
                (26,900
                )
                
                (43,057
                )
                
                (74,100
                )Total
                    other income (expense)
                
                
                (6,157
                )
                
                (25,500
                )
                
                (13,135
                )
                
                (56,300
                )Loss
                    before provision for income taxes
                
                
                (149,595
                )
                
                (216,100
                )
                
                (436,333
                )
                
                (523,200
                )Provision
                    for income taxes
                
                
                -
                
                
                -
                
                
                -
                
                
                -Net
                    loss
                
                $
                (149,595
                )
                $
                (216,100
                )
                $
                (436,333
                )
                $
                (523,200
                )Basic
                    and diluted weighted averagecommon
                    shares outstanding
                
                
                24,337,458
                
                
                20,495,337
                
                
                24,093,492
                
                
                20,389,937Basic
                    and diluted loss per common share
                
                $
                (0.01
                )
                $
                (0.01
                )
                $
                (0.02
                )
                $
                (0.03
                )
 
 See
          Accompanying Notes to Financial Statements
  4
  CAN-CAL
          RESOURCES LTD
 STATEMENTS
          OF CASH FLOWS
 (UNAUDITED)
 
 For the Nine Months EndedSeptember 30,2007
                
                2006Cash
                    flows from operating activities:Net
                    loss
                
                $
                (436,333
                )
                $
                (523,200
                )Adjustments
                    to reconcile net loss to netcash
                    used by operating activities:Beneficial
                    conversion feature on convertible debt
                
                
                -
                
                
                25,200Common
                    stock issued for accrued wages, related party
                
                
                22,000
                
                
                -Depreciation
                    and amortization
                
                
                7,297
                
                
                4,800Financing
                    fees
                
                
                
                
                
                24,400Gain
                    on disposal of fixed assets
                
                
                (3,701
                )
                
                -Stock
                    based compensation
                
                
                2,000
                
                
                72,600Stock
                    options granted to officers and consultants
                
                
                -
                
                
                123,500Decrease
                    (increase) in assets:Accounts
                    receivable
                
                
                3,600
                
                
                -Other
                    current assets
                
                
                -
                
                
                8,600Other
                    assets
                
                
                (10,000
                )
                
                -Increase
                    (decrease) in liabilities:Accounts
                    payable
                
                
                (11,973
                )
                
                18,300Accrued
                    interest
                
                
                35,310
                
                
                46,200Accrued
                    officer salary
                
                
                (68,331
                )
                
                53,300Accrued
                    payroll taxes
                
                
                -
                
                
                (2,000
                )Unearned
                    revenues
                
                
                5,600
                
                
                5,600Net
                    cash used by operating activities
                
                
                (454,531
                )
                
                (142,700
                )Cash
                    flows from investing activities:Purchase
                    of fixed assets
                
                
                (31,788
                )
                
                (5,800
                )Purchase
                    of mining claims
                
                
                (15,054
                )
                
                (19,600
                )Proceeds
                    from sale of fixed assets
                
                
                7,000
                
                
                -Net
                    cash used in investing activities
                
                
                (39,842
                )
                
                (25,400
                )Cash
                    flows from financing activities:Payment
                    due to stockholder
                
                
                -
                
                
                (11,500
                )Principal
                    payments on notes payable, related parties
                
                
                (20,750
                )
                
                -Proceeds
                    from issuance of common stock
                
                
                140,012
                
                
                506,200Proceeds
                    from the exercise of warrants
                
                
                186,343
                
                
                -Net
                    cash provided by financing activities
                
                
                305,605
                
                
                494,700Net
                    increase (decrease) in cash
                
                
                (188,768
                )
                
                326,600Cash,
                    beginning of period
                
                
                419,700
                
                
                17,000Cash,
                    end of period
                
                $
                230,932
                
                $
                343,600Supplemental
                    disclosure of cash flow information:Cash
                    paid for income taxes
                
                $
                -
                
                $
                -Cash
                    paid for interest
                
                $
                -
                
                $
                -Warrants
                    issued for services
                
                $
                -
                
                $
                67,603Issuance
                    of common stock for services
                
                $
                -
                
                $
                5,000Accrued
                    interest added to principle on note payable
                
                $
                -
                
                $
                5,900Accrued
                    interest added to principle on note payable
                
                $
                -
                
                $
                -Debt
                    forgiveness
                
                $
                101,745
                
                $
                -
 
 See
          Accompanying Notes to Financial Statements
  5
  ITEM
        2.
        NOTES TO FINANCIAL STATEMENTS
 
 CAN-CAL
        RESOURCES LTD
 NOTES
        TO
        CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
 
 1.
              BASIS
                  OF PRESENTATION
 
 The
        accompanying unaudited financial statements have been prepared in accordance
        with Securities and Exchange Commission requirements for interim financial
        statements. Therefore, they do not include all of the information and footnotes
        required by accounting principles generally accepted in the United States
        for
        complete financial statements. The financial statements should be read in
        conjunction with the Form 10-KSB for the year ended December 31, 2006 of
        Can-Cal
        Resources Ltd ("the Company").
  The
        interim financial statements present the balance sheet, statements of
        operations, and cash flows of Can-Cal Resources Ltd. The financial statements
        have been prepared in accordance with accounting principles generally accepted
        in the United States.
  The
        interim financial information is unaudited. In the opinion of management,
        all
        adjustments necessary to present fairly the financial position as of September
        30, 2007 and the results of operations and cash flows presented herein have
        been
        included in the financial statements. Interim results are not necessarily
        indicative of results of operations for the full year.
 
 The
        preparation of financial statements in conformity with accounting principles
        generally accepted in the United States requires management to make estimates
        and assumptions that affect the reported amounts of assets and liabilities
        and
        disclosure of contingent assets and liabilities at the date of the financial
        statements and the reported amounts of revenues and expenses during the
        reporting period. Actual results could differ from those estimates.
 
 2.
              GOING
                    CONCERN
 
 The
        Company incurred a net loss of approximately $436,000 for the nine months
        ended
        September 30, 2007. The Company's current liabilities exceed its current
        assets
        by approximately $645,000 as of September 30, 2007. These factors create
        substantial doubt about the Company's ability to continue as a going concern.
        The Company's management plans to continue to fund its operations in the
        short
        term with a combination of debt and equity financing, as well as revenue
        from
        operations in the long term.
 
 The
        ability of the Company to continue as a going concern is dependent on additional
        sources of capital and the success of the Company's plan. The financial
        statements do not include any adjustments that might be necessary if the
        Company
        is unable to continue as a going concern.
 
 3.
              CORRECTION
                  OF ERROR - ERROR RELATES TO A YEAR NOT PRESENTED IN THE COMPARATIVE
                  FINANCIAL STATEMENTS
  Other
        assets has been increased by $381,500 as of December 31, 2006 to correct
        an
        error made in 2006. The prior period error relates to our valuation of mineral
        rights acquired through the issuance of 1,000,000 shares of our $0.001 par
        value
        common stock. The error had no effect on net income. The following is a summary
        of the prior year adjustment:
 
 Increase
                  of previously reported other assets:- unrecorded
                  value of mineral rights acquired
              
              $
              381,500Increase
                  of previously reported additional paid in capital:- unrecorded
                  amount of additional paid in capital on stock issuance
              
              $
              381,500
 
 The
        effect on the Company’s previously issued September 30, 2007 financial
        statements are summarized as follows:
 
 6
  *Consolidated
        Balance Sheet as of September 30, 2007*
  *Previously*
                *Reported*
              
              *Net*
                *Change*
              
              *Restated*AssetsCurrent
                  assetsCash
              
              $
              230,932
              
              $
              -
              
              $
              230,932Total
                  current assets
              
              
              230,932
              
              
              -
              
              
              230,932Fixed
                  assets, net
              
              
              40,191
              
              
              -
              
              
              40,191Other
                  assets, net
              
              
              74,167
              
              
              381,500
              
              
              455,667$
              345,290
              
              $
              381,500
              
              $
              726,790Current
                  liabilitiesAccounts
                  payable
              
              $
              22,227
              
              $
              -
              
              $
              22,227Accrued
                  interest
              
              
              297,810
              
              
              -
              
              
              297,810Accrued
                  officer salary
              
              
              111,436
              
              
              -
              
              
              111,436Accrued
                  payroll taxes
              
              
              68,587
              
              
              -
              
              
              68,587Notes
                  payable - related parties
              
              
              360,550
              
              
              -
              
              
              360,550Unearned
                  revenues
              
              
              15,000
              
              
              -
              
              
              15,000Total
                  current liabilities
              
              
              875,610
              
              
              -
              
              
              875,610Commitments
                  and contingencies
              
              
              -
              
              
              -
              
              
              -Stockholders’
                  deficitPreferred
                  stock
              
              
              -
              
              
              -
              
              
              -Common
                  stock
              
              
              24,361
              
              
              -
              
              
              24,361Additional
                  paid-in capital
              
              
              7,347,252
              
              
              381,500
              
              
              7,728,752Accumulated
                  deficit
              
              
              (7,901,933
              )
              
              -
              
              
              (7,901,933
              )Total
                  stockholders’ deficit
              
              
              (530,320
              )
              
              381,500
              
              
              (148,820
              )$
              345,290
              
              $
              381,500
              
              $
              726,790
  4.
              NOTES
                  PAYABLE, RELATED PARTIES
 
 Notes
        payable consisted of the following as of September 30, 2007:
 
 Note
                  payable to a stockholder, secured by real property, bearing interest
                  at
                  16.0% per annum, semi-annual interest only payments, matured November
                  2005
                  (currently in default)
              
              $
              300,000Note
                  payable to a stockholder, secured by real property, bearing interest
                  at
                  8.0% per annum, maturing February 2008
              
              
              25,114Note
                  payable to a stockholder, secured by real property, bearing interest
                  at
                  8.0% per annum, maturing January 2008
              
              
              35,436Current
                  portion (amounts due within one year)
              
              $
              360,550
 
 The
        Company is in default of its semi-annual interest payments of $280,000 for
        the
        years ended 2002 - 2006 and the nine months ended September 30, 2007 on a
        note
        payable of $300,000. The Company is currently negotiating forbearance on
        collection of the principle and interest.
  5.
                CHANGES
                    IN SECURITIES
 
 During
          the nine months ended September 30, 2007, the Company sold 1,043,455 restricted
          common shares to various accredited Canadian and US residents for a total
          of
          $326,368, and issued warrants to purchase 298,083 restricted common shares,
          exercisable between $.45 and $.65 per share. During the nine months ended
          September 30, 2007, the Company also issued 50,000 shares of restricted
          common
          stock as part of a settlement agreement with a former officer of the Company
          for
          compensation of accrued salaries. In addition to cash payments of $3,500
          per
          month for twelve (12) consecutive months beginning January 2007 and terminating
          December 2007. The Company has recorded debt forgiveness of $101,745 in
          accordance with the terms of the settlement agreement. Due to the related
          party
          nature of the transaction the gain has been recorded to additional paid
          in
          capital, therefore there has been no impact on the Company's net
          loss.
 
 6.
                SUBSEQUENT
                    EVENTS
 
 On
          October 10, 2007, the Company sold 2,000 shares of restricted common stock
          for a
          total of $1,000 valued at $.50 per share and issued warrants to purchase
          2,000
          restricted common shares, exercisable at $.65 per share.
 
 7
  ITEM
        2.
        MANAGEMENT'S DISCUSSION AND ANALYSIS
 
 (A)
        PLAN
        OF OPERATION.
 
 Can-Cal
        Resources Ltd. is a public company engaged in the acquisition and exploration
        of
        precious metals mineral properties. The Company initiated the re-evaluation
        of
        its North American properties, which began the 2nd quarter of 2005, through
        in-house and independent analysis.
 
 On
        September 26, 2006, the Company signed a letter of intent with E.R.S. Ltd.,
        an
        Israeli owned Cyprus corporation with offices located in Tel Aviv. The letter
        of
        intent was to expand testing by E.R.S. on material from Can-Cal's Pisgah
        property. As of September 30, 2007, the Company was unable to reach a definitive
        agreement with E.R.S.; therefore, the Board of Directors voted unanimously
        to
        discontinue further negotiations.
 
 In
        April,
        June, July and September 2006, the Company conducted further surface sampling
        and rock wall sampling on its Wikieup, Arizona property. These samples were
        shipped to ALS Chemex, an internationally recognized assayer for fire assays
        and
        I.C.P. tests. The preliminary assay results were encouraging and the Company
        will continue with further surface sampling from various areas of the
        approximate six square miles of claimed land.
 
 In
        May
        and September 2006, Can-Cal acquired an additional 66 20-acre lode claims
        for
        the filing cost of $1,200. This increased the Company's property holding
        to 1900
        acres or 2.969 square miles of 95 lode claims. On August 28, 2006, Can-Cal
        acquired an additional 1,800 acres from the Rose Trust in exchange for 1,000,000
        restricted shares of its common stock. This increases the Company's property
        holding on its Wikieup, Arizona property to approximately six square miles.
        The
        area is accessed by gravel road just off highway 93 approximately eight miles
        from the town of Wikieup, Arizona.
  Adits,
        tunnels, and open pit locations following what may be a trend or vein structure
        over a large region have been found on the property. The legacy of previous
        mining activity including; abandoned equipment, stone built homes, a cement
        water reservoir and numerous tailings piles, can be seen from various
        locations.
 
 Upon
        receipt of the recent surface sample assay results from ALS Chemex (up to
        Au
        1.27 O.P.T , Ag - 32.52 O.P.T and Zn 25.1 %) the Company is attempting to
        follow
        what may be a trend or vein structure and has subsequently claimed the
        additional 1,320 acres.
  The
        geology of the Wikieup area claims is comprised of Precambrian granoids and
        gneiss. Outcrops are extensive on the property and rock units include diorite,
        gabbro and granitic dikes.
 
 The
        Company is continuing the surface sampling program and plans to hire an
        independent geologist for continued exploration.
 
 The
        Company plans to expand its U.S. property holdings in 2007. The Company
        presently has two full-time employees and will continue to rely on outside
        consultants and agents, in the near-term, to perform various administrative,
        legal and technical functions, as required.
 
 (B)
        RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2007 AND
        2006.
 
 The
        following table summarizes selected items from the statement of operations
        for
        the three months ended September 30, 2007 compared to September 30,
        2006.
 
 EXPENSES:
  Three
                  Months EndedSeptember
                  30,2007
              
              2006
              
              Increase/(Decrease)Amount
              
              Amount
              
              $
              
              %Expenses:Beneficial
                  conversion discount
              
              $
              -
              
              $
              4,200
              
              
              (4,200
              )
              
              (100
              )%Exploration
                  costs
              
              
              46,588
              
              
              12,100
              
              
              34,488
              
              
              285
              %Depreciation
              
              
              1,277
              
              
              1,700
              
              
              (423
              )
              
              (25
              )%General
                  & administrative expenses
              
              
              64,631
              
              
              79,000
              
              
              (14,369
              )
              
              (18
              )%General
                  & administrative expenses - related party
              
              
              30,942
              
              
              97,800
              
              
              (66,858
              )
              
              (68
              )%Total
                  operating expenses
              
              
              143,438
              
              
              194,800
              
              
              (51,362
              )
              
              (26
              )%Loss
                  from operations
              
              
              (143,438
              )
              
              (194,800
              )
              
              (51,362
              )
              
              (26
              )%Other
                  income (expense):Interest
                  income
              
              
              2,387
              
              
              -
              
              
              2,387
              
              
              -Gain
                  on disposal of fixed assets
              
              
              -
              
              
              -
              
              
              -
              
              
              -Rental
                  revenue
              
              
              5,625
              
              
              5,600
              
              
              25
              
              
              .5
              %Interest
                  expense
              
              
              (14,169
              )
              
              (26,900
              )
              
              (12,731
              )
              
              (47
              )%Net
                  loss
              
              $
              (149,595
              )
              $
              (216,100
              )
              $
              (66,505
              )
              
              (31
              )%
  8
  EXPLORATION
        COSTS
 
 Exploration
        costs for the three months ended September 30, 2007 increased by $34,488
        or 285%
        from $12,100 for the three months ended September 30, 2006 to $46,588 for
        the
        three months ended September 30, 2007. The increase is a result of increased
        exploration of U.S. properties in order to extract precious metals for testing
        purposes.
  Unless
        the Company is able to establish the economic viability of its mining
        properties, the Company will continue writing off its expenses of exploration
        and testing of its properties. Therefore, losses will continue unless the
        Company sells one or more of its properties or locates and delineates reserves
        and initiates mining operations. If that occurs, the Company may capitalize
        certain of those expenses.
 
 The
        Company has no material commitments for capital expenditures other than
        expenditures it chooses to make with respect to testing and or exploration
        of
        its mineral properties.
 
 DEPRECIATION
 
 Depreciation
        for the three months ended September 30, 2007 decreased by $423 or 25% from
        $1,700 for the three months ended September 30, 2006 to $1,277 for the three
        months ended September 30, 2007. The increase is principally due to the deletion
        of a furnace purchased in January of 2007.
 
 GENERAL
        AND ADMINISTRATIVE EXPENSES
 
 General
        and administrative expenses for the three months ended September 30, 2007
        decreased by $14,369 or 18% from $79,000 for the three months ended September
        30, 2006 to $64,631 for the three months ended September 30, 2007. The decrease
        is principally due to decreased advertising and stock house expenses.
 
 GENERAL
        AND ADMINISTRATIVE EXPENSES - RELATED PARTY
 
 General
        and administrative expenses - related party for the three months ended September
        30, 2007 decreased by $66,858 or 68% from $97,800 for the three months ended
        September 30, 2006 to $30,942 for the three months ended September 30, 2007.
        The
        decrease is principally due to the one time conversion of salary in 2006.
        No
        such conversion was done in 2007.
 
 TOTAL
        OPERATING EXPENSES
 
 Total
        operating expenses for the three months ended September 30, 2007 decreased
        by
        $51,362 or 26% from $194,800 for the three months ended September 30, 2006
        to
        $143,438 for the three months ended September 30, 2007. The decrease in total
        operating expenses was mainly a result of management's efforts to control
        overhead costs. During the prior year, we experienced non- recurring costs
        required to support certain debt financing activities, conversion of salary
        as
        well as, costs associated with the issuance of options to an Officer of the
        Company.
  9
  OTHER
        INCOME (EXPENSE)
 
 During
        the three months ended September 30, 2007, interest income in the amount
        of
        $2,387 relates to interest earned on cash received as a result of financing
        activities.
 
 Interest
        expense for the three months ended September 30, 2007 decreased by $12,731
        or
        47% from $26,900 for the three months ended September 30, 2006 compared to
        $14,169 for the three months ended September 30, 2007. The significant decrease
        is due to the repayment of certain long term debts that were paid with the
        Company's common stock at the end of 2006.
 
 NET
        LOSS
 
 Our
        net
        loss was $149,595 for the three months ended September 30, 2007 compared
        to a
        net loss of $216,100 for the three months ended September 30, 2006. We expect
        to
        improve our results of operations through the attainment of sufficient working
        capital and a focus on generating revenues from the subcontracting of mining
        activities, and a reduction of general and administrative expenses.
 
 (C)
        RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2007 AND
        2006.
 
 The
        following table summarizes selected items from the statement of operations
        for
        the nine months ended September 30, 2007 compared to September 30,
        2006.
  EXPENSES:
 
 NINE
                  MONTHS ENDEDSEPTEMBER
                  30,2007
              
              2006
              
              INCREASE/(DECREASE)AMOUNT
              
              AMOUNT
              
              $
              
              %Expenses:Beneficial
                  conversion discount
              
              $
              -
              
              $
              25,200
              
              $
              (25,200
              )
              
              (100
              )%Exploration
                  costs
              
              
              149,532
              
              
              22,800
              
              
              126,732
              
              
              556
              %Depreciation
              
              
              7,297
              
              
              4,800
              
              
              2,497
              
              
              52
              %General
                  & administrative expenses
              
              
              173,375
              
              
              167,200
              
              
              6,175
              
              
              4
              %General
                  & administrative expenses - related party
              
              
              92,994
              
              
              272,100
              
              
              (179,106
              )
              
              (66
              )%Total
                  expenses
              
              
              423,198
              
              
              491,100
              
              
              (68,902
              )
              
              (14
              )%Net
                  operating loss
              
              
              (423,198
              )
              
              (492,100
              )
              
              (68,902
              )
              
              (14
              )%Other
                  income (expense):Interest
                  income
              
              
              9,346
              
              
              100
              
              
              9,246
              
              
              9246
              %Gain
                  on disposal of fixed asset
              
              
              3,701
              
              
              -
              
              
              3,701
              
              
              100
              %Rental
                  revenue
              
              
              16,875
              
              
              42,900
              
              
              (26,025
              )
              
              (61
              )%Interest
                  expense
              
              
              (43,057
              )
              
              (74,100
              )
              
              (31,043
              )
              
              (42
              )%Net
                  loss
              
              $
              (436,333)
              
              $
              (523,200
              )
              $
              (86,867
              )
              
              (17
              )%
 
 BENEFICIAL
        CONVERSION DISCOUNT
 
 During
        the nine months ended September 30, 2006, beneficial conversion discount
        in the
        amount of $25,200 relates to a convertible feature of the Company's long
        term
        debt.
 
 EXPLORATION
        COSTS
 
 Exploration
        costs for the nine months ended September 30, 2007 increased by $126,732
        or 556%
        from $22,800 for the nine months ended September 30, 2006 to $149,532 for
        the
        nine months ended September 30, 2007. The increase is a result of increased
        exploration of US properties in order to extract precious metals for testing
        purposes.
  Unless
        the Company is able to establish the economic viability of its mining
        properties, the Company will continue writing off its expenses of exploration
        and testing of its properties. Therefore, losses will continue unless the
        Company sells one or more of its properties or locates and delineates reserves
        and initiates mining operations. If that occurs, the Company may capitalize
        certain of those expenses.
 
 The
        Company has no material commitments for capital expenditures other than
        expenditures it chooses to make with respect to testing and or exploration
        of
        its mineral properties.
 DEPRECIATION
 Depreciation
        for the nine months ended September 30, 2007 increased by $2,497 or 52% from
        $4,800 for the nine months ended September 30, 2006 to $7,297 for the nine
        months ended September 30, 2007. The increase is principally due to the
        additional depreciation of assets purchased in April of 2007.
  10
  GENERAL
        AND ADMINISTRATIVE EXPENSES
 
 General
        and administrative expenses for the nine months ended September 30, 2007
        increased by $6,175 or 4% from $167,200 for the nine months ended September
        30,
        2006 to $173,375 for the nine months ended September 30, 2007. The increase
        is
        principally due to the hiring of additional personal to increase investor
        relations.
  GENERAL
        AND ADMINISTRATIVE EXPENSES - RELATED PARTY
 
 General
        and administrative expenses - related party for the nine months ended September
        30, 2007 decreased by $179,106 or 66% from $272,100 for the nine months ended
        September 30, 2006 to $92,994 for the nine months ended September 30, 2007.
        The
        decrease is principally due to the one time charge in 2006 related to options
        that were issued to an Officer of the Company. No such options were issued
        in
        2007.
 
 TOTAL
        OPERATING EXPENSES
 
 Total
        operating expenses for the nine months ended September 30, 2007 decreased
        by
        $68,902 or 14% from $492,100 for the nine months ended September 30, 2006
        to
        $423,198 for the nine months ended September 30, 2007. The decrease in total
        operating expenses was mainly a result of management's efforts to control
        overhead costs. During the prior year, we experienced non-recurring costs
        required to support certain debt financing activities, as well as, costs
        associated with the issuance of options to an Officer of the Company.
 
 OTHER
        INCOME (EXPENSE)
 
 Interest
        income for the nine months ended September 30, 2007 increased by $9,246 or
        9246%
        from $100 for the nine months ended September 30, 2006 to $9,346 for the
        nine
        months ended September 30, 2007. The increase is principally due to interest
        earned on a money market account that was opened in 2007 using proceeds from
        financing activities.
  During
        the nine months ended September 30, 2007, the Company recognized a gain on
        disposal of fixed assets in the amount of $3,701 from the sale of two vehicles.
 
 Rental
        revenue for the nine months ended September 30, 2007 decreased by $26,025
        or 61%
        from $42,900 for the nine months ended September 30, 2006 compared to $16,875
        for the nine months ended September 30, 2007. The significant decrease is
        due to
        a one time charge in 2006 related to the rental of the Company's land to
        a movie
        production company.
 
 Interest
        expense for the nine months ended September 30, 2007 decreased by $31,043
        or 42%
        from $74,100 for the nine months ended September 30, 2006 compared to $43,057
        for the nine months ended September 30, 2007. The significant decrease is
        due to
        the repayment of certain long term debts that were paid with the Company's
        common stock at the end of 2006.
 
 NET
        LOSS
  Our
        net
        loss was $436,333 for the nine months ended September 30, 2007 compared to
        a net
        loss of $523,200 for the nine months ended September 30, 2006. We expect
        to
        improve our results of operations through the attainment of sufficient working
        capital and a focus on generating revenues from the subcontracting of mining
        activities, and a reduction of general and administrative expenses.
 
 (D)
        LIQUIDITY AND CAPITAL RESOURCES AND RESULTS OF OPERATIONS
 
 The
        following table summarizes total current assets, total current liabilities
        and
        working capital at September 30, 2007 compared to December 31, 2006.
  September
                  30,
              
              December
                  31,
              
              INCREASE/(DECREASE)2007
              
              2006
              
              $
              
              %Current
                  Assets
              
              $
              230,932
              
              $
              423,300
              
              $
              (192,368
              )
              
              (45
              )%Current
                  Liabilities
              
              $
              875,610
              
              $
              1,037,500
              
              $
              (161,890
              )
              
              (16
              )%Working
                  Capital (deficit)
              
              $
              (644,678
              )
              $
              (614,200
              )
              $
              (
                  30,478
              )
              
              (5
              )%
  Internal
        and External Sources of Liquidity
  During
        the nine months ended September 30, 2007, our operating and investing activities
        used cash of $454,531 and $39,842, respectively, while our financing activities
        provided cash of $305,605. The cash used in operating activities was principally
        a result of the net loss we incurred.
 
 Cash
        Flow. Since inception, we have primarily financed our cash flow requirements
        through the issuance of common stock and the issuance of notes. With the
        growth
        of our current business we may, during our normal course of business, experience
        net negative cash flows from operations until some of our mining activities
        begin to produce revenues. Further, we may be required to obtain financing
        to
        fund operations through additional common stock offerings and bank or other
        debt
        borrowings, to the extent available, or to obtain additional financing to
        the
        extent necessary to augment our available working capital.
 
 11
 
 SATISFACTION
        OF OUR CASH OBLIGATIONS FOR THE NEXT TWELVE MONTHS.
 
 As
        of
        September 30, 2007, our cash balance was $230,932. Our plan for satisfying
        our
        cash requirements for the next twelve months is through additional equity,
        third
        party financing, and/or debt financing. We anticipate our current cash reserves
        will be sufficient to support operations through December 31, 2007, but do
        not
        anticipate generating sufficient amounts of positive cash flow to meet our
        working capital requirements. Consequently, we intend to make appropriate
        plans
        to ensure sources of additional capital in the future to fund growth and
        expansion through additional equity or debt financing or credit facilities.
        We
        also are considering possible funding through joint venture arrangements
        with
        other mining companies.
 
 As
        we
        expand operational activities, we may continue to experience net negative
        cash
        flows from operations, pending receipt of sales and will be required to obtain
        additional financing to fund operations through common stock offerings and
        debt
        borrowings to the extent necessary to provide working capital.
 
 We
        anticipate incurring operating losses until we build our capital base. Our
        recent operating history makes predictions of future operating results difficult
        to ascertain. In addition, since our cash position has fallen we are finding
        it
        increasingly difficult to expand our operations. Thus, our prospects must
        be
        considered in light of the risks, expenses and difficulties frequently
        encountered by companies in their early stages of commercial viability,
        particularly companies in rapidly evolving energy markets. Such risks include,
        but are not limited to, an evolving and unpredictable business model and
        the
        management of growth. To address these risks we must, among other things,
        implement and successfully execute our business and marketing strategy, continue
        to develop and upgrade technology and products, respond to competitive
        developments, and continue to attract, retain and motivate qualified personnel.
        There can be no assurance that we will be successful in addressing such risks,
        and the failure to do so can have a material adverse effect on our business
        prospects, financial condition and results of operations.
 
 ITEM
        3.
        CONTROLS AND PROCEDURES
 
 As
        of the
        end of the period covered by this report, the certifying officer of the Company
        has evaluated the effectiveness of the company's disclosure controls and
        procedures. This evaluation was carried out under the supervision and with
        the
        participation of our management, including our principal financial officer.
        Based on this evaluation, these officers have concluded that the design and
        operation of our disclosure controls and procedures are effective. There
        were no
        changes in our internal control over financial reporting or in other factors
        that have materially affected, or are reasonably likely to materially affect,
        our internal control over financial reporting.
 
 Disclosure
        controls and procedures are those controls and other procedures we maintain,
        which are designed to ensure that all of the information required to be
        disclosed by the company in all its periodic reports filed with the SEC is
        recorded, processed, summarized and reported, within the time periods specified
        in the SEC's rules and forms. Disclosure controls and procedures include,
        without limitation, controls and procedures designed to ensure that information
        required to be disclosed by the company in its reports filed or submitted
        under
        the Securities Exchange Act of 1934 is accumulated and communicated to company
        management, as appropriate, to allow management to make timely decisions
        regarding required disclosure. The Company believes that its disclosure controls
        and procedures are effective to ensure that information required to be disclosed
        by the Company in reports that it files or submits under the 1934 Act is
        recorded, processed, summarized and reported within the time periods specified
        in Securities and Exchange Commission rules and forms.
 
 Changes
        in Internal Control over Financial Reporting
 There
        were no changes in our internal control over financial reporting, as defined
        in
        Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently
        completed fiscal quarter that have materially affected, or are reasonably
        likely
        to materially affect, our internal control over financial reporting.
 
 12
 
 PART
        II -
        OTHER INFORMATION
 
 ITEM
        1.
        LEGAL PROCEEDINGS
 
 None.
 
 ITEM
        2.
        CHANGES IN SECURITIES.
 
 During
        the three months ended September 30, 2007, the Company sold 51,946 restricted
        shares of common stock to various accredited Canadian investors and one United
        States investor for a total of $25,973, and at a price of $0.65 per share.
        These
        securities were issued in private transactions, with respect to the Canadian
        residents, in reliance on the exemption from registration with the SEC provided
        by Regulation S and with respect to the United States investor, in reliance
        upon
        the exemption from registration provided under Section 4(2) of the 1933
        Securities Act.
  The
        Company redeemed 33,000 warrants held by a Canadian resident at a price of
        $0.25
        per share for a total of $8,250.00
  On
        October 10, 2007, subsequent to the end of the 2007 third quarter period,
        the
        Company sold 2,000 shares of restricted common stock for a total of $1,000
        valued at $.50 per share and issued warrants to purchase 2,000 restricted
        common
        shares, exercisable at $.65 per share. These securities were issued to an
        accredited Canadian investor in a private transaction in reliance upon
        Regulation S.
  ITEM
        3.
        DEFAULTS UPON SENIOR SECURITIES
  The
        Company is in default of a note payable for $300,000 and its semi- annual
        interest payments of $280,000 for the years ended 2002- 2006 and the nine
        months
        ended September 30, 2007. The Company is currently negotiating forbearance
        on
        collection of the principle and interest.
 
 ITEM
        4.
        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
 None.
 
 ITEM
        5.
        OTHER INFORMATION
 
 N/A
 
 ITEM
        6.
        EXHIBITS AND REPORTS ON FORM 8-K
 
 EXHIBIT
        32 Certification Per Sarbanes Oxley
 
 13
 
 SIGNATURES
 
 In
        accordance with the requirements of the Exchange Act, the registrant caused
        this
        report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 CAN-CAL
                  RESOURCES LTD.(REGISTRANT)Date:
                  November 14, 2007
              By:
              /s/Ronald
                  D. SloanRONALD
                  D. SLOAN,Chief
                  Executive Officer andPresident
  14