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

  X      Quarterly Report pursuant to Section 13 or 15(d) of the Securities
-----    Exchange Act of 1934

         For the fiscal quarter ended June 30, 2002

         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            (I.R.S. Employer Identification No.)
 incorporation or organization)

                   8221 Cretan Blue Lane, 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
                                                          -------      --------

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13, or 15(d) of the Exchange Act after the distribution of
securities under a plan by a court.
                                                      Yes_____  No_____

                      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 on August 12, 2002
--------------------------------         ---------------------------------------
 Common Stock, Par Value $.001.                    10,924,015

Transitional Small Business Disclosure Format (Check one): Yes_____  No   X
                                                                       -------


                                        1

<PAGE>









                           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 ore, negative test results, the existence of precious metals in
the 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, 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 Company's 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

<PAGE>



                                    CONTENTS



                                                                       PAGE NO.

PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

          Interim balance sheets                                             4

          Interim statements of operations                                   5

          Interim statements of changes in stockholders' deficit             6

          Interim statements of cash flows                                   7

          Notes to interim financial statements                           8-10

          Supplementary schedule:
            Supplemental schedule I--
            Operating, general and administrative expenses                  11

ITEM 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations                     12


PART II.  OTHER INFORMATION

ITEM 6.   Exhibits and Reports on Form 8-K                                    14

          Signatures                                                          15


                                        3

<PAGE>



PART I

ITEM 1  FINANCIAL STATEMENTS

                             CAN-CAL RESOURCES LTD.
                                 BALANCE SHEETS


                                     ASSETS

<TABLE>
<CAPTION>
                                                                      June 30, 2002   December 31, 2001
                                                                       (UNAUDITED)
Current assets
<S>                                                                   <C>              <C>
     Cash                                                             $    75,000      $    14,800
     Notes receivable-related parties                                      59,300           57,400
     Prepaid expenses                                                       8,100           13,100
                                                                      -----------       ----------
         Total current assets                                             142,400           85,300

Fixed assets, net                                                          48,000           48,600

Other assets                                                               15,100            2,000
                                                                      -----------       ----------

Total assets                                                          $   205,500      $   135,900
                                                                      ===========      ===========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
     Accounts payable and accrued liabilities                         $   169,200      $   105,500
     Notes payable - current portion                                       52,500           50,000
     Notes payable-related parties - current portion                      112,500             --
     Other current liabilities                                             60,100             --
                                                                      -----------       ----------
         Total current liabilities                                        394,300          155,500

Long-term liabilities
     Notes payable - long-term portion                                    300,000          348,000
     Notes payable-related parties - long-term portion                       --            104,000
     Convertible note payable-related party                               120,000             --
                                                                      -----------       ----------
Total liabilities                                                         814,300          607,500

Commitments and contingencies                                                --               --

Stockholders' deficit
     Common stock; $.001 par value; 15,000,000 shares
         authorized, 10,924,000 shares issued and outstanding              10,900           10,200
     Additional paid-in capital                                         3,733,200        3,490,100
     Unamortized loan fees                                                (29,500)            --
     Accumulated deficit                                               (4,323,400)      (3,971,900)
                                                                      -----------       ----------
         Total stockholders' deficit                                     (608,800)        (471,600)
                                                                      -----------       ----------
Total liabilities and stockholders' deficit                           $   205,500      $   135,900
                                                                      ===========      ===========
</TABLE>



                 See Accompanying Notes to Financial Statements

                                        4

<PAGE>



                             CAN-CAL RESOURCES LTD.
                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)



<TABLE>
<CAPTION>

                                              Three Months Ended June 30,           Six Months Ended June 30,
                                            -----------------------------       ------------------------------
                                                 2002               2001              2002               2001

<S>                                         <C>               <C>               <C>               <C>
Rental revenue                              $      5,700      $     16,900      $     11,300      $     22,500

General and administrative                       145,100           156,600           257,100           328,300
                                            ------------      ------------      ------------      ------------
Loss from operations                            (139,400)         (139,700)         (245,800)         (305,800)

Other income (expense)
     Other income                                   --                --                --                 800
     Interest income                                 900             2,800             1,900             8,000
     Interest expense                            (30,400)          (19,200)         (107,600)          (34,100)
                                            ------------      ------------      ------------      ------------
Loss before provision for income taxes          (168,900)         (156,100)         (351,500)         (331,100)

Provision for income taxes                          --                --                --                --
                                            ------------      ------------      ------------      ------------
Net loss                                    $   (168,900)     $   (156,100)     $   (351,500)     $   (331,100)
                                            ============      ============      ============      ============


Basic and diluted loss per common share     $      (0.02)     $      (0.02)     $      (0.03)     $      (0.04)
                                            ============      ============      ============      ============
Basic and diluted weighted average
     common shares outstanding                10,288,100         9,372,800        10,609,500         9,372,800
                                            ============      ============      ============      ============
</TABLE>



                 See Accompanying Notes to Financial Statements

                                        5

<PAGE>



                             CAN-CAL RESOURCES LTD.
                       STATEMENT OF STOCKHOLDERS' DEFICIT
                                   (UNAUDITED)




<TABLE>
<CAPTION>

                                                Common Stock
                                          ------------------------    Additional                                     Total
                                            Number of                  Paid-in      Unamortized    Accumulated    Stockholders'
                                             Shares       Amount       Capital      Loan fees       Deficit         Deficit
                                          ------------  ----------  ------------- -------------- --------------  -------------

<S>                                         <C>          <C>         <C>                <C>       <C>             <C>
Balance, December 31, 2001                  10,158,700   $ 10,200    $ 3,490,100              --  $ (3,971,900)   $  (471,600)

Common shares issued for cash                  415,600         400        108,100             --             --        108,500

Common shares issued for accrued
   interest of $48,000  and interest
   expense of $71,800                          309,700         300        119,500             --             --        119,800

Common shares issued for services               40,000          --         14,000             --             --         14,000

Unamortized loan fees                               --          --             --       (30,200)             --       (30,200)

Current period amortization of
     unamortized loan fees                          --          --             --            700             --            700

Deemed interest expense related to
    conversion feature of note payable              --          --          1,500             --             --          1,500

 Net loss                                           --          --             --             --      (351,500)      (351,500)
                                          ------------  ----------  ------------- -------------- --------------  -------------

 Balance, June 30, 2002                     10,924,000   $ 10,900    $ 3,733,200   $    (29,500)  $ (4,323,400)   $  (608,800)
                                          ============  ==========  ============= ============== ==============  =============
</TABLE>




                 See Accompanying Notes to Financial Statements

                                        6

<PAGE>



                                              CAN-CAL RESOURCES LTD.
                                             STATEMENTS OF CASH FLOWS
                                                    (UNAUDITED)


<TABLE>
<CAPTION>
                                                                Six Months Ended June 30,
                                                                -------------------------
                                                                   2002            2001

Cash flows from operating activities:
<S>                                                             <C>            <C>
   Net loss                                                     $(351,500)     $(331,100)
   Adjustments to reconcile net loss to net
    cash used by operating activities:
      Depreciation                                                  9,100         13,000
      Stock issued for services                                    14,000
      Stock issued for interest                                    71,800           --
      Deemed interest expense                                       1,500           --
      Current period amortization of unamortized loan fees            700           --
   Changes in operating assets and liabilities:
      Change in notes receivable-related parties                   (1,900)        (8,000)
      Change in prepaid expenses                                    5,000           --
      Change in other assets                                      (13,100)        (3,700)
      Change in accounts payable and accrued expenses              81,500        (14,800)
      Change in other current liabilities                          60,100           --
                                                                ---------      ---------
         Net cash used by operating activities                   (122,800)      (344,600)

Cash flows from investing activities:
   Payments for issuance of notes receivable                         --             (700)
   Proceeds from payments on notes receivable                        --            1,900
   Purchase of fixed assets                                        (8,500)        (2,500)
                                                                ---------      ---------
         Net cash used by investing activities                     (8,500)        (1,300)

Cash flows from financing activities:
   Proceeds from issuance of common stock                         108,500           --
   Proceeds from borrowing on notes payable                        65,000           --
   Principal payments on notes payable                           (110,500)          --
   Proceeds from borrowing on notes payable-related parties        40,600        (22,500)
   Principal payments on notes payable-related parties            (32,100)        (8,700)
   Proceeds from convertible debenture                            120,000           --
                                                                ---------      ---------
         Net cash provided (used) by financing activities         191,500        (31,200)
                                                                ---------      ---------
Net increase (decrease) in cash                                    60,200       (377,100)

Cash, beginning of period                                          14,800        510,800

Cash, end of period                                             $  75,000      $ 133,700
                                                                =========      =========

Supplemental disclosure of cash flow information:
   Cash paid for income taxes                                   $    --        $    --
                                                                =========      =========
   Cash paid for interest                                       $    --        $    --

Schedule of non-cash financing activities:
   Issuance of common stock in satisfaction of accrued
      interest                                                  $  48,000      $    --
                                                                =========      =========
</TABLE>



                 See Accompanying Notes to Financial Statements

                                        7

<PAGE>


                             CAN-CAL RESOURCES, LTD
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)


1.   BASIS OF PRESENTATION
     ---------------------

         The accompanying 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 generally accepted accounting
         principles for complete financial statements. The financial statements
         should be read in conjunction with the Forms 10-KSB for the year ended
         December 31, 2001 of Can-Cal Resources, Ltd. ("the Company").

         The interim financial statements present the balance sheet, statements
         of income, stockholders' equity 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 June 30, 2002 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 of America 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.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
     ------------------------------------------

         Reclassification - Certain prior year balances have been reclassified
         to conform to the current year presentation.

3.   NOTES RECEIVABLE-RELATED PARTIES
     --------------------------------

         Notes receivable-related parties consisted of the following as of June
         30, 2002:

<TABLE>
<S>                                                                             <C>
         Note receivable from S&S Mining, Inc. a joint venture partner
           unsecured, interest imputed at 8%, due on demand                     $   27,800

         Note receivable from a stockholder, unsecured, interest imputed
           at 8%, due on demand                                                     12,000

         Accrued interest receivable                                                19,500
                                                                                ----------

                                                                                $   59,300
                                                                                ==========
</TABLE>


4.   NOTES PAYABLE
     -------------

         Notes payable consisted of the following as of June 30, 2002:

<TABLE>
<S>                                                                             <C>
         Note payable to an entity, secured by 2nd deed of trust,
           bearing interest at 16.0% per annum, maturing November 2005          $  300,000

         Note payable to an entity, secured by deed of trust, bearing
           interest at 6.0% per annum, maturing June 2002                           12,500

         Note payable to an entity, secured by deed of trust, bearing
           interest at 8.0% per annum, maturing June 2002                       $   25,000
</TABLE>


                                        8

<PAGE>


                             CAN-CAL RESOURCES, LTD
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)


4.   NOTES PAYABLE (continued)
     -------------

<TABLE>
<S>                                                                             <C>
         Note payable to an entity, secured by deed of trust, bearing
           interest at 6.0% per annum, maturing June 2002                           15,000
                                                                                ----------

                                                                                   352,500
         Less: amounts due within one year                                          52,500
                                                                                ----------

         Long-term portion of notes payable                                     $  300,000
                                                                                ==========
</TABLE>

5.   NOTES PAYABLE-RELATED PARTIES
     -----------------------------

         Notes payable-related parties consists of the following
         as of June 30, 2002:

<TABLE>
<S>                                                                             <C>
         Note payable to a stockholder, unsecured, bearing interest
           at 1.0% per annum, due on demand                                     $   66,600

         Note payable to a stockholder, unsecured, bearing interest
           at 20.7% per annum, due on demand                                        18,800

         Note payable to a stockholder, unsecured, bearing interest
           at 7.5% per annum, maturing July 2002                                    11,300

         Note payable to a stockholder, unsecured, bearing interest
           at 7.5% per annum, maturing February 2003                                 5,000

         Note payable to a stockholder, unsecured, bearing interest
           at 7.5% per annum, maturing April 2003                                    5,000

         Note payable to a stockholder, unsecured, bearing interest
         at 7.5% per annum, maturing April 2003                                      3,000

         Note payable to a stockholder, unsecured, bearing interest
           at 7.5% per annum, maturing February 2003                                 2,000

         Note payable to a stockholder, unsecured, bearing interest
           at 24.0% per annum, maturing May 2002                                       800
                                                                                ----------

                                                                                   112,500
         Less: amounts due within one year                                         112,500
                                                                                ----------

         Long-term portion of notes payable - related parties                   $       --
                                                                                ==========
</TABLE>


                                        9

<PAGE>


                             CAN-CAL RESOURCES, LTD
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)


6.   OTHER CURRENT LIABILITIES
     -------------------------

     Other current liabilities consist of the following as of June 30, 2002:

<TABLE>
<S>                                                                             <C>
         119,620 shares of common stock due to investors for receipt of cash    $   29,900

         50,000 warrants due related to convertible note payable (see Note 7)       16,700

         30,000 shares due related to convertible note payable (see Note 7)         13,500
                                                                                ----------

                                                                                $   60,100
                                                                                ==========
</TABLE>

7.   CONVERTIBLE NOTE PAYABLE-RELATED PARTY
     --------------------------------------

         As of June 30, 2002 convertible note payable-related party totaling
         $120,000 consisted of an unsecured loan agreement with a stockholder.
         Upon closing, the Company paid $13,400 in loan fees and other expenses
         which were capitalized and recorded as other assets which will be
         expensed over the life of the loan using the straight- line method. For
         the six months ended June 30, 2002, the Company amortized $300 of the
         loan fees and related expenses as interest expense. The term of the
         loan is two years, with interest at 8.0%, and maturing in June 2004.
         The stockholder/lender has the option of converting this loan to
         free-trading common stock, at the lower of a) the initial purchase
         price, defined as the lower of $0.41 per share or 100% of the average
         of the lowest five closing bid prices of the fifteen prior trading days
         prior to closing, or b) 80% of average of the three lowest prices in
         fifteen closing bid prices prior to conversion.

         Due to the conversion feature of the debt and the Company's historical
         range of common stock prices, the Company anticipates it will record
         significant amounts of deemed interest in the future as funds are drawn
         on the loan. During the six months ended June 30, 2002, the Company
         recorded $1,400 of deemed interest expense relating to this conversion
         feature.

         As of June 30, 2002, the stockholder/lender was due warrants to
         purchase 50,000 shares of the Company's common stock at the lower of
         110% of the 5-day average closing bid prices a) preceding the date of
         issue, or b) 180 days after each closing. The warrants expire after
         three years. The fair value of the warrants as computed using the
         Black-Scholes option pricing model was $16,700 and recorded as
         unamortized loan fees, of which $400 was recorded as interest expense
         during the six months ended June 30, 2002. The Company has recorded a
         liability of $16,700 for the warrants which is included in other
         current liabilities totaling $60,100.

         As of June 30, 2002, the stockholder/lender was also due 30,000 shares
         of the Company's common stock for legal fees related to the loan. The
         30,000 shares were valued at $13,500 and recorded as unamortized loan
         fees, of which $300 was recorded as general and administrative expenses
         during the six months ended June 30, 2002. The Company has recorded a
         liability of $13,500 for the 30,000 shares which is included in other
         current liabilities totaling $60,100.


                                       10

<PAGE>


                             CAN-CAL RESOURCES, LTD
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)


8.   RESTATED FINANCIAL STATEMENTS
     -----------------------------

         Subsequent to the issuance of the Company's financial statements for
         the three months ended March 31, 2002, management became aware that
         those financial statements did not properly reflect certain account
         balances. Properly accounting of these items in the revised financial
         statements has the following effect:


<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                                      Three Months Ended      March 31, 2002      RESTATED
                                                        March 31, 2002         (RESTATED)         Changes
                                                        --------------         ----------         -------

<S>                                                     <C>                  <C>               <C>
            Revenue                                     $      5,600         $      5,600      $       --
            General and administrative expenses              112,100              112,000              (100)
            Loss from operations                            (106,500)            (106,400)              100
            Other income (expense)
               Interest income                                 1,000                1,000              --
               Interest expense                              (41,400)             (77,200)          (35,800)
            Loss before provision for income taxes          (146,900)            (182,600)          (35,700)
            Provision for income taxes                          --                   --                --
            Net loss                                    $   (146,900)        $   (182,600)     $    (35,700)
                                                        ============         ============      ============
            Basic and diluted loss per common share     $      (0.01)        $      (0.02)     $      (0.01)
                                                        ============         ============      ============
            Basic and diluted weighted average
               common shares outstanding                  10,486,357           10,436,225        10,436,225
                                                        ============         ============      ============
</TABLE>

         For the three months ended March 31, 2002, the change in the statement
         of operations was primarily related to interest expense for which the
         Company had two changes. First, the Company re-evaluated accrued
         interest and determined it was overstated by approximately $36,000.
         Accordingly, the Company decreased the balance by $36,000 to properly
         reflect the accrued interest and related interest expense. Second, the
         Company issued 309,700 shares of its common stock in satisfaction of
         accrued interest of $48,000 in accordance with an agreement which
         stated that the number of shares to be issued would be based on 50% of
         the lowest trading price from November 2000 to December 2001 ($0.155),
         in relation to the outstanding accrued interest balance. Accordingly,
         the issuance of these shares was recorded based upon the accrued
         interest balance rather than the fair value of such shares issued. The
         Company has re-evaluated this transaction and determined the issuance
         of such shares should be recorded at the fair value. As a result, the
         Company recorded and additional $71,800 of interest expense for the
         three months ended March 31, 2002.

         The Company also determined that the number of outstanding shares was
         not recorded correctly and increased from 10,514,400 to 10,651,500. The
         change in the net loss and increase of the recalculated basic and
         diluted weighted average common shares outstanding increased the basic
         and diluted loss per common shares from $(0.01) to $(0.02).

9.   GOING CONCERN
     -------------

         The Company incurred a net loss of approximately $351,000 for the six
         months ended June 30, 2002. The Company's current liabilities exceed
         its current assets by approximately $252,000 as of June 30, 2002. 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.



                                       11

<PAGE>


                             CAN-CAL RESOURCES, LTD
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)


CAN-CAL RESOURCES, LTD.

SUPPLEMENTAL SCHEDULE I -
OPERATING, GENERAL AND ADMINISTRATIVE EXPENSES

THREE AND SIX MONTHS ENDED JUNE 30, 2002 AND 2001
(UNAUDITED)
(ROUNDED TO THE NEAREST HUNDRED)


<TABLE>
<CAPTION>
                                                    Three Months Ended June 30,      Six Months Ended June 30,
                                                   ----------------------------    ---------------------------
                                                       2002              2001         2002               2001
                                                   --------           --------     --------           --------
General and administrative expenses
<S>                                                <C>                <C>          <C>                <C>
  Accounting and legal                             $  6,700           $  5,000     $ 32,600           $  8,000
  Consulting                                         39,200             57,100       64,100             90,500
  Salaries and wages                                 15,000               --         30,000               --
  Office rent                                         7,900              8,000       15,900             15,900
  Insurance                                          10,800             12,600       23,500             20,600
  Travel and entertainment                           10,800             18,100       15,500             41,700
  Depreciation                                        4,600              6,600        9,100             13,000
  Office expense                                      2,100             12,400        5,500             30,800
  Miscellaneous                                       6,800              3,400        9,800              5,100
  Mine exploration                                   17,600             21,100       20,300             80,400
  Utilities                                           1,400              2,800        3,600              4,300
  Equipment rental                                    2,500              2,800        4,400              4,400
  Telephone                                           1,100              3,400        2,900              6,100
  Payroll taxes                                       1,200               --          2,400               --
  Advertising and promotion                          17,300              2,100       17,400              3,300
  Repairs and maintenance                              --                1,200         --                4,200
  Bank charges                                          100               --            100               --
                                                   --------           --------     --------           --------
     Total general and administrative expenses     $145,100           $156,600     $257,100           $328,300
                                                   ========           ========     ========           ========
</TABLE>



                                       12

<PAGE>



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR
         PLAN OF OPERATION

(A)      PLAN OF OPERATION.

     We intend to continue sampling and testing volcanic cinder materials from
the Pisgah property with a small pilot plant to be located at a location within
approximately one hour driving time from the Pisgah property, assuming we have
the necessary funds. We anticipate using the pilot plant to process small
batches of material for testing purposes. We also plan to obtain an independent
reserve report and feasibility study before building the production plant.

     Assuming capital can be raised through the equity line financing with
Dutchess Fund and DRH, and precious metals are proven to exist at the Cerbat
property, we will build a small scale pilot plant and begin processing material
from the Cerbat property for precious metals (primarily gold silver). The
location of the pilot plant has not yet been determined. If the pilot plant is
shown to consistently extract precious metals from the materials, the company
will retain an independent consultant to determine if there are reserves of
precious metals in the property. The reserve study would be based on
comprehensive drilling and sampling of the property according to a grid system
using industry standards.

     There is no assurance that precious metals exist in the volcanic cinders in
commercial quantities or, if they do, that they can be profitably extracted from
either the Pisgah property or the Cerbat property.

     The Company has no present plans to conduct any activities or operations on
any of its other properties.

     During the six months ended June 30, 2002, we sold 415,600 restricted
common shares for a total of $108,500, and issued warrants to exercise 415,600
restricted common shares, exercisable at $0.25 per share.

     On June 14, 2002 received $106,600 net proceeds from sale of a convertible
debenture to Dutchess Private Equities Fund. The company paid to Dutchess
Advisors, Ltd. (advisor to Dutchess Fund) $13,400 as payment for loan fees and
related expenses.

     All or part of the principal amount ($120,000) of the debenture, plus
accrued interest at 8% annually, is convertible at Dutchess Fund's discretion
into restricted shares of common stock, at a per share price equal to the lesser
of: (1) $0.41; (2) 100% of the average of the five lowest closing bid prices in
the 15 trading days preceding June 14, 2002); or (3) 80% of the average of the
three lowest closing bid prices in the 15 trading days preceding notice of
conversion. To the extent not prepaid or converted, outstanding principal and
accrued interest will be converted automatically to restricted shares of common
stock, at the lesser of the conversion prices stated above, on the maturity date
of the debenture (June 14, 2005).

     If the $120,000 principal amount of the debenture is converted at the $0.41
price, we would issue 292,683 shares to Dutchess Fund, and the offer and sale of
those shares would be covered by this prospectus. This prospectus covers a total
of 950,000 shares issuable to Dutchess Fund on conversion of the debenture; the
number of shares issued on conversion will depend on the market price (for
example, the full 950,000 shares would be issued if the market price drops to
the point where the conversion price is calculated at $0.126 per share.

     In connection with the transaction, we will issue to Dutchess Fund a
warrant to purchase 50,000 restricted shares of common stock, at an exercise
price per share equal to the lesser of (1) $0.36 (110% of the five day average
closing bid price for the five trading days before June 14, 2002, which was the
issue date for the warrant); or (2) 110% of the five day average closing bid
price for the five trading days after December 12, 2002.

     Also in connection with the transaction with Dutchess Fund, we will issue
to Joseph B. LaRocco, attorney for Dutchess Fund, 30,000 restricted shares of
common stock, for legal services provided to Dutchess Fund in connection with
the debenture and warrant transaction. The services have been valued by the
company at $13,500

                                       13

<PAGE>



of which the entire amount was capitalized as unamortized loan fees.
Amortization of such loan fees total $300 for the three months ended June 20,
2002.

     We will depend on sales of stock to Dutchess Private Equities Fund, L.P.
and DRH Investment Company, LLC, who are providers of the equity line of credit
established under an Investment Agreement with us, to build the pilot plants,
obtain independent reserve reports and independent feasibility studies, pay
general and administrative expenses, and pay debt service. For more information
regarding the Investment Agreement, see annual report on Form 10-KSB for the
year ended December 31, 2001.

     At June 30, 2002, and before sale of any stock to Dutchess Fund and DRH, we
had approximately $75,000 cash available to sustain operations, which would
cover two month of operations maximum. In advance of such sales, we may seek
additional capital by sale of restricted stock in private placement transactions
in Canada, loans from directors, or possible funding or joint venture
arrangements with other mining companies. However, there are no plans or
arrangements now in place to fund the company by any of these means, and outcome
of the discussions with other companies cannot be predicted.

     It is not anticipated that the Company will purchase (or sell) any
significant amount of equipment or other assets, or experience any significant
change in the number of personnel who perform services for the Company, during
the fiscal year ending December 31, 2002. However, this depends on results of
its ongoing testing programs and financing available to it.

(B)  LIQUIDITY AND CAPITAL RESOURCES AND RESULTS OF OPERATIONS

     As of June 30, 2002, the Company had a working capital deficit of
approximately $252,000.

     The Company had no operating income or cash flow from its mineral
operations for the six months ended June 30, 2002 or the six months ended June
30, 2001. The Company sustained a loss from operations of $245,800 for the six
month period ended June 30, 2002, compared to a loss of $305,800 for the six
month period ended June 30, 2001. The decreased loss was primarily due to
decreases in mine exploration costs of $60,100, travel and entertainment costs
of $26,200, consulting fees of $26,400; and office expense of $25,300. These
reductions were offset by increases in salaries and wages of $30,000, accounting
and legal fees of $24,600, and advertising and promotion expenses of $14,100.

     General and administrative expenses decreased approximately $71,200 to
$257,100 (compared to $328,300 in 2001). The changes in costs and expenses,
stated as changes for the period ended June 30, 2002 compared to the same period
for 2001, were due to:

     o    Accounting and legal costs increased by $24,600 due to costs incurred
          as a result of filing a registration statement with the Securities and
          Exchange Commission to register shares for resale.

     o    A decrease of $26,400 paid to consultants for research and development
          on our Pisgah cinder material in 2001.

     o    Salaries and wages increased by $30,000 and payroll taxes by $2,400
          because we agreed in June 2001 to pay Mr. Sloan a salary of $60,000
          per year. We have accrued these expenses. There were no salary and
          wages, or payroll taxes during the same period in 2001.

     o    Insurance costs increased $2,900 due to increases in insurance
          premiums.

     o    Travel and entertainment costs decreased $26,200 due to less travel by
          directors and less travel expenses incurred for consultants.

     o    Depreciation decreased by $3,900 because some of our equipment has
          been fully depreciated.

                                       14

<PAGE>



     o    Office expense decreased $25,300. During the six month period ended
          June 30, 2001, we established an office at the Nye County lab
          facility. Establishment of the office resulted in one time expenses
          for equipment and supplies. The facility was closed on December 31,
          2001.

     o    Mine exploration costs decreased $60,100 due to a reduction in the
          amount of third party assay tests performed for the company and
          discontinuation of exploration on the Owl Canyon property.

     o    Advertising and promotion expenses increased by $14,100 due to
          substantial revisions in the layout and content of our website, and
          investor relations program being initiated.

     o    Repairs and maintenance decreased by $4,200. No repairs and
          maintenance costs were incurred during the period ended June 30, 2002.

     o    Telephone costs decreased by $3,200 due to lower long distance
          telephone rates.

     o    Miscellaneous costs increased by $4,700 as a result of filing fees
          associated with registration statement filing fees.

     Subsequent to the issuance of the Company's financial statements for the
three months ended March 31, 2002, management became aware that those financial
statements did not properly reflect certain account balances. Properly
accounting of these items in the revised financial statements has the following
effect:


<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                                      Three Months Ended      March 31, 2002      RESTATED
                                                        March 31, 2002         (RESTATED)         Changes
                                                        --------------         ----------         -------

<S>                                                     <C>                  <C>               <C>
            Revenue                                     $      5,600         $      5,600      $       --
            General and administrative expenses              112,100              112,000              (100)
            Loss from operations                            (106,500)            (106,400)              100
            Other income (expense)
               Interest income                                 1,000                1,000              --
               Interest expense                              (41,400)             (77,200)          (35,800)
            Loss before provision for income taxes          (146,900)            (182,600)          (35,700)
            Provision for income taxes                          --                   --                --
            Net loss                                    $   (146,900)        $   (182,600)     $    (35,700)
                                                        ============         ============      ============
            Basic and diluted loss per common share     $      (0.01)        $      (0.02)     $      (0.01)
                                                        ============         ============      ============
            Basic and diluted weighted average
               common shares outstanding                  10,486,357           10,436,225        10,436,225
                                                        ============         ============      ============
</TABLE>


     For the three months ended March 31, 2002, the change in the statement of
operations was primarily related to interest expense for which the Company had
two changes. First, the Company re-evaluated accrued interest and determined it
was overstated by approximately $36,000. Accordingly, the Company decreased the
balance by $36,000 to properly reflect the accrued interest and related interest
expense. Second, the Company issued 309,700 shares of its common stock in
satisfaction of accrued interest of $48,000 in accordance with an agreement
which stated that the number of shares to be issued would be based on 50% of the
lowest trading price from November 2000 to December 2001 ($0.155), in relation
to the outstanding accrued interest balance. Accordingly, the issuance of these
shares was recorded based upon the accrued interest balance rather than the fair
value of such shares issued. The Company has re-evaluated this transaction and
determined the issuance of such shares should be recorded at the fair value. As
a result, the Company recorded and additional $71,800 of interest expense for
the three months ended March 31, 2002.


                                       15

<PAGE>



     The Company also determined that the number of outstanding shares was not
recorded correctly and increased from 10,514,400 to 10,651,500. The change in
the net loss and increase of the recalculated basic and diluted weighted average
common shares outstanding increased the basic and diluted loss per common shares
from $(0.01) to $(0.02).

     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 locates and delineates reserves. 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.


                           PART II - OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)  Exhibits.

              No.      Description                                      Page No.
              ---      -----------                                      --------

              99.1     Certification Pursuant to
                       Section 1350 of Chapter 63 of
                       Title 18 of the United States Code....................18

         (b)  Reports on Form 8-K. There was one report filed by the Company
              on Form 8-K during the quarter ended June 30, 2002, filed on
              June 26, 2002, under Item 4, reporting a change in registrant's
              certify accountant.



                                       16

<PAGE>


                                   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:  August 13, 2002                 By:   /s/  Ronald D. Sloan
                                                 -------------------------------
                                                 RONALD D. SLOAN, President


                                       17

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