UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549

                                 FORM 10-QSB

  X   Quarterly  Report  pursuant  to  Section  13  or  15(d) of the Securities
      Exchange Act of 1934
      For the fiscal quarter ended June 30, 2006

      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)

                  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 _____


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 21, 2006
   Common Stock, Par Value $.001.                       21,017,603

Transitional Small Business Disclosure  Format  (Check one): Yes ____  No     X






CONTENTS



                                                                       PAGE NO.

PART I.     FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS

            Condensed Balance Sheet (unaudited)				F-1

            Condensed Statements of Operations (unaudited)            	F-2

            Condensed Statements of Cash Flows (unaudited) 		F-3

            Notes to Condensed Financial Statements (unaudited)         F-4

ITEM 2.     Management's Discussion and Analysis of
            Financial Condition and Results of Operations 		  4

ITEM 3.     Controls and Procedures 					  6

PART II.    OTHER INFORMATION

ITEM 1.     Legal Proceedings						  7

ITEM 2.     Chancges in Securities					  7

ITEM 3.     Defaults Upon Senior Securities 			          7

ITEM  4.    Submission of Matters to a Vote of Security Holders		  7

ITEM 5.     Other information						  7

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

            Signatures                                                    8

            Certifications                                         Exhibits



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.




PART I.     FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS


			CAN-CAL RESOURCES LTD
 			    BALANCE SHEET
			     (UNAUDITED)
<TABLE>
<CAPTION>

<S>                                                          <C>



                           ASSETS
                                                                As Of
                                                            June 30, 2006
							    -------------
Current assets
Cash                                                              $73,200
Other current assets                                                2,500
							    -------------
Total current assets                                               75,700

Fixed assets, net                                                  16,700

Other assets, net                                                  11,800
							    -------------
Total assets                                                     $104,200
							    =============
           LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
Accrued interest                                                 $239,400
Accrued officer salary payable                                    310,000
Accrued payroll taxes                                             111,100
Accounts payable                                                   39,300
Convertible debenture, net of unamortized discount of $4,200       35,800
Due to stockholder                                                 11,900
Notes payable-related parties                                     378,300
Unearned revenues                                                  20,600
							    -------------
Total current liabilities                                       1,146,400
							    -------------

Total liabilities                                               1,146,400


Stockholders' deficit
Preferred stock; $0.001 par value; 10,000,000 shares
authorized, no shares issued and outstanding                           --
Common stock; $0.001 par value; 100,000,000 shares
authorized,  19,538,568 shares issued and outstanding              19,500
Additional paid-in capital                                      6,090,200
Accumulated deficit                                           (7,151,900)
							    -------------
Total stockholders' deficit                                   (1,042,200)
							    -------------
Total liabilities and stockholders' deficit                      $104,200
							    =============

See Accompanying Notes to Financial Statements

</TABLE>
						CAN-CAL RESOURCES LTD
 					       STATEMENTS OF OPERATIONS
						     (UNAUDITED)
<TABLE>
<CAPTION>

<S>                                                 <C>                        <C>




                                                  	    Three Months Ended June 30            Six Months Ended June 30
                                                              2006             2005                2006             2005
							 ------------	  --------------      -------------    ---------------

Material sales                                           $	   --     $	   2,900      $		 --    $	11,400

Cost of sales                                                      --      	   4,800                 --     	 9,400
							 ------------	  --------------      -------------    ---------------
Gross profit                                                       --    	  (1,900)                --      	 2,000

Expenses
Exploration costs                                               1,800      	   4,300             10,700     	10,100
Depreciation                                                    1,600      	   1,200              3,300     	 2,300
General and administrative expenses                            42,700    	 129,000             89,200    	       193,200
General and administrative expenses - related party           158,300     	  31,400            173,300     	93,100
							 ------------	  --------------      -------------    ---------------
Loss from operations                                         (204,400)  	(167,800)          (276,500)  	      (296,700)

Other income (expense)
Confessional judgement                                              -     	  26,500                  -     	26,500
Beneficial conversion discount                                (12,600)        	       -            (21,000)         	     -
Interest income                                                     -        	       -                100         	     -
Other income                                                        -         	       -              2,000         	     -
Rental revenue                                                 22,100      	   5,600             35,200     	11,300
Interest expense                                              (26,800)   	 (15,100)           (47,200)   	       (30,300)
							 ------------	  --------------      -------------    ---------------
Loss before provision for income taxes                       (221,700)  	(150,800)          (307,400)  	      (289,200)

Provision for income taxes                                          -        	       -                  -         	     -
							 ------------	  --------------      -------------    ---------------
Net loss                                                 $    (221,700)   $	(150,800)     $    (307,400)   $      (289,200)
							 ============	  ==============      =============    ===============
Basic and diluted loss per common share                  $	(0.01)    $	   (0.01)     $       (0.02)   $	 (0.02)
							 ============	  ==============      =============    ===============
Basic and diluted weighted average
common shares outstanding                                  19,413,570 	      18,865,079         19,255,320 	     18,972,071
							 ============	  ==============      =============    ===============

See Accompanying Notes to Financial Statements

</TABLE>
					CAN-CAL RESOURCES LTD
 				      STATEMENTS OF CASH FLOWS
					    (UNAUDITED)
<TABLE>
<CAPTION>

<S>                                                    <C>                      <C> <C>


                                                      		      Six Months Ended June 30
                                                                        2006           2005
								   -------------  --------------
Cash flows from operating activities:
Net loss                                                           $	(307,400) $	(289,300)
Adjustments to reconcile net loss to net
 cash used by operating activities:
Stock based compensation                                                     900     	  77,500
Options granted officers and consultants                                 123,500
Depreciation and amortization                                              3,200      	   2,300
Beneficial conversion feature on convertible debenture                    35,800
Changes in operating assets and liabilities:
Accounts receivable                                                           --      	   7,600
Accounts payable                                                         (18,900)    	  15,000
Accrued interest                                                          25,600     	  75,800
Accrued officer salary payable                                            41,100    	  (8,900)
Unearned revenues                                                         11,200     	  15,900
Other current assets                                                      (2,800)    	  (4,400)
Other assets                                                                (600)    	  (1,100)
								   -------------  --------------
Net cash used by operating activities                                    (88,400)  	(109,600)
								   -------------  --------------
Cash flows from financing activities:
Payment due to stockholder                                                  (500)      	    (300)
Preceeds from convertible debenture                                       40,000              --
Proceeds from issuance of common stock                                   112,800    	 153,600
Principal payments on notes payable - related parties                     (7,700)    	  (3,000)
								   -------------  --------------
Net cash provided by financing activities                                144,600    	 150,300
								   -------------  --------------
Net increase (decrease) in cash                                           56,200     	  40,700

Cash, beginning of period                                                 17,000     	  68,600
								   -------------  --------------
Cash, end of period                                                $	  73,200  $	 109,300
								   =============  ==============
Supplemental disclosure of cash flow information:
Cash paid for income taxes                                         $	      --  $	      --
								   =============  ==============
Cash paid for interest                                             $	      --  $	  30,354
								   =============  ==============
Issuance of common stock for services                              $	      --  $	  77,500
								   =============  ==============
Accrued interest added to principle on notes payable               $	   3,200  $	      --
								   =============  ==============

See Accompanying Notes to Financial Statements

</TABLE>


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, 2005 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 June 30, 2006 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. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

   Presentation of Financial Statements - The Company rounds the figures on the
   financial statements to the nearest hundred.


3. NOTES PAYABLE-RELATED PARTIES

   Notes payable consisted of the following as of June 30, 2006:

      Note payable to a stockholder, secured by real property, bearing
      interest at 16.0% per annum, interest only payments payable in
      semi-annual payments, maturing November 2005

      (Note:  The Company  is  in  default  of  principal and interest payments
      totaling $520,000  but is currently negotiating forbearance on collection
      of the interest)                                        $   300,000

      Note payable to a stockholder, unsecured, bearing interest
      at 7.5% per annum, maturing June 2007                         3,800

      Note payable to a stockholder, secured by real property, bearing interest
      at 8.0% per annum, maturing August 2006 which will be rolled over at  the
      same terms for the next six months.			   34,000

      Note  payable to a stockholder, secured by real property, bearing interest
      at  8.0%  per  annum, maturing July 2006 which has been rolled over at the
      same terms for six months.				   31,500


      Note  payable to a stockholder, secured by real property, bearing interest
      at  8.0%  per  annum,  maturing May 2006 which has been rolled over at the
      same terms for six months.				    9,000


      Current portion (amounts due within one year)          $    378,300


   The Company is in default of its semi-annual interest  payments of $ 220,000
   for the years ended 2002, 2003, 2004, 2005 and the six months ended June 30,
   2006  on  a note payable of $300,000.  The Company is currently  negotiating
   forbearance on collection of the principle and interest.


4.   CHANGES IN SECURITIES

   During the six months ended June 30, 2006, we sold 564,000 restricted common
   shares to 25  Canadian residents, 7 US residents and 5 Israeli Nationals for
   a total of $112,800,  and  issued  warrants  to  purchase 464,000 restricted
   common shares, exercisable at $0.25 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 U.S. citizen, in reliance on the exemption available
   under Section 4(2) of the 1933 Act.

   We  also  issued,  for  services, 2,500 restricted common shares for a total
   value of $875 and these securities  were  issued  to  one  U.S.  resident in
   reliance on the exemption provided by Section 4(2) of the 1933 Act.


5. COMMITMENTS AND CONTINGENCIES

  Operating lease - The Company operates from a leased facility in Nevada under
a  month  to  month    basis.   The  lease  calls  for  monthly  base  rent  of
approximately $1,500.

6.   CONVERTIBLE DEBENTURE

      On January 24, 2006 the Company issued a $40,000 convertible debenture to
an  individual.  The  Company has determined the debenture to have a beneficial
conversion feature totaling  $25,196.   The  beneficial  conversion feature has
been  recorded as a debt discount which will be amortized on  a  straight  line
basis over  the  life  of the loan.  The beneficial conversion was valued under
the Black-Scholes options  pricing  model  using the following assumptions: (1)
stock price of $0.20; estimated life of 6 months; historical volatility rate of
120% and debt discount rate of 4.88%. The investor  shall  have  one  year from
January 24, 2006 to exercise 160,000 warrants.  The warrant strike price  shall
be $0.25 per share of restricted stock.


7.    OPTIONS GRANTED FOR EMPLOYEE AND CONSULTING SERVICES

For  the  six  months  ended  June 30, 2006, the Company granted options to buy
750,000 shares of   the Company's  common  stock  at an exercise price of $0.20
with terms ranging from two to five years from the  date  of  issuance  to  the
Directors  of  the  Company.   Additionally,  the  Company  granted  options to
purchase  250,000 shares of the Company's common stock at an exercise price  of
$0.20 with  a  term  of  three  years from the date of issuance to an unrelated
consultant.

In accordance with FASB 123R (revised  2004) "Share-based Payment", the Company
recognized the fair value of the options  in the statement of operations on the
date  of  grant.   Fair value was determined using  the  Black  Scholes  option
pricing model based  on  the  following  assumptions: expected dividends: $-0-;
volatility: 86%; risk free interest rate:  4.92% to 5.16%.  The determined fair
value recognized in the current period was $123,475

8. GOING CONCERN

      The Company incurred a net loss of approximately  $307,400  for  the  six
months  ended  June  30,  2006.   The  Company's current liabilities exceed its
current assets by approximately $1,070,700  as of June 30, 2006.  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.


9. SUBSEQUENT EVENTS

   From July 1, 2006 through  the  date  of  this  report,  the  Company issued
   820,500  shares  of  the  Company's  common  stock  and warrants to purchase
   820,500  of  the  Company's  common stock for cash totaling  $174,600.   The
   warrants are fully vested upon  grant,  expire  in  two  years  and  have an
   exercise price of between $0.25 and $0.40 per share.

   In  July  2006,  Mr.  Ronald  D.  Sloan,  Chairman/President of the Company,
   converted $81,000 of his accrued salary to  385,714  shares of the Company's
   stock at $0.21 per share and warrants to purchase 385,714  of  the Company's
   common stock. The warrants are fully vested upon grant, expire in  two years
   and have an exercise price of $0.25 per share.

   In  July  2006,  a third party U.S. Creditor, converted $11,932 of corporate
   liability to 56,821  shares  of  the  Company's stock at $0.21 per share and
   warrants to purchase 56,821 of the Company's  common stock. The warrants are
   fully vested upon grant, expire in two years and  have  an exercise price of
   $0.25 per share.

   In July 2006, the company issued 11,000 shares of the Company's stock valued
   at $2,662 and warrants to purchase 11,000 of the Company's common stock to a
   U.S. individual for services rendered to the Company. The warrants are fully
   vested upon grant, expire in two years and have an exercise  price  of $0.25
   per share.

   In  July 2006, the company issued 5,000 shares of the Company's stock  to  a
   U.S. individual for services rendered to the Company totaling $1,050.

   In July  2006,  a  Canadian  investor,  in  accordance  with  the terms of a
   convertible debenture of $40,000 plus 10% interest per annum, exercised  the
   right  to  purchase  200,000  shares  of private placement restricted common
   stock of the Company at $0.20 per share.  Also, in accordance with the terms
   of the debenture 6,767 shares of private  placement  restricted common stock
   of the Company at $0.28 per share relating to interest on the debenture were
   issued. The convertible debenture incorporates 160,000  warrants to purchase
   shares. The warrants are fully vested upon grant, expire  in  one  year  and
   have an exercise price of $0.25 per share.

       On August 2, 2006 the Company acquired the right to an additional ninety
   unpatented  20-acre  lode  mining  claims  consisting  of  1800 acres at the
   Wikieup,  Arizona  property.   In  full  payment for the mining claims,  the
   Company will issue 1,000,000 shares of private  placement  restricted common
   stock at $0.40 per share.  The company discounted the share price 15% due to
   the private placement restriction on the stock.   The discounted stock value
   is at $0.34 per share for a value of $340,000.



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

(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 June 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 is for further testing on material from its Pisgah property.

   In early 2006, the Company furnished  material  from  its  Pisgah  crater to
E.R.S. to perform tests and obtain analysis.  In June 2006, E.R.S. notified the
Company that it desired to perform additional and more comprehensive testing to
determine  the metal values in the material by conducting an extensive sampling
program on the  3,500,000  tons  screened  stockpile.   E.R.S.  will  also test
additional  areas  of  the property. Before commencing such additional testing,
E.R.S. wanted to be assured  that  if it determined to pursue the extraction of
any metals that the Company would enter into a production agreement with E.R.S.


   The  letter of intent provides that  during  the  period  of  three  months,
beginning  June  26,  2006,  E.R.S.  will  perform  tests  and  analysis on the
Company's  material with principal initial testing taking place in  Israel  and
Europe.  Any metal extracted will be sent to laboratories in Italy and possibly
Belgium for analysis.  All testing and analysis will be paid for by E.R.S.

   If E.R.S.  desires  to  enter  into a formal agreement for the production of
metals from that material it will notify the Company in writing and furnish the
Company with all analysis and assays.   The  formal agreement, if entered into,
will then provide that:

   1. E.R.S. will pay 100% for all costs incurred  in  connection with, and all
      associated costs relating to the mining, processing and production of any
      metals  extracted  for  the Pisgah crater.  This includes  all  costs  of
      obtaining additional permits,  costs  of  all  equipment,  mining  costs,
      production  costs,  refining costs, transportation costs, assaying costs,
      sales costs, working  capital,  labor,  overhead, and any and all related
      costs.

   2. The Company will receive a net profit interest  of  between 12.5% and 15%
      of any net profits realized from the production and sale  of  any  metals
      recovered, depending on the metals produced and the grade of the recovery
      of such metals.  Net profit will mean the amount of revenue received from
      any purchaser of metals sold, less costs paid by E.R.S.

   The  Company  will  cooperate with E.R.S. in obtaining any necessary permits
and export permits required for material shipped out of the country by E.R.S.


      In April 2006, the  Company  conducted  further  surface  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.

      In  May  and June 2006, Can-Cal acquired an additional  66  20-acre  load
claims for the filing  cost  of  $1,200.  This increases the Company's property
holding to 1900 acres or 2.969 square  miles  of  95  lode  clams.  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.   Outcrop  is  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 presently has gold exploration  projects  located  in Mexico,
California  and Arizona.  In September 2003, the Company incorporated a  wholly
owned Mexican  subsidiary, Sierra Madre Resources S. A. de C. V. ("SMR"), which
is the Company's principal vehicle for acquisitions in Mexico.

      In 2004, the  Company  acquired  a 100% interest in a gold-silver mineral
concession, referred to as the Arco Project.    In  2006,  upon  request of the
Mexican concessionaire, the Company was asked to relinquish its interest in the
Arco  #1  property.  As Can-Cal's major interests are now focused on  the  U.S.
properties,  the  Company  has  agreed to the request; however, will retain the
Arco  #  2 property.  At the present  time  the  Board  of  Directors  are  re-
evaluating the Company's interests in Mexico.

      The Company plans to expand its U.S. property holdings in 2006.

      The  Company  has discontinued industrial sales of the volcanic materials
located on the Pisgah  property  until the small-scale in-house and independent
analysis of the Pisgah material is complete.

      The Company presently has one  full-time  employee  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)   LIQUIDITY AND CAPITAL RESOURCES AND RESULTS OF OPERATIONS

      As of  June  30,  2006,  the  Company  had  a  working capital deficit of
$1,070,700 and approximately $73,200 cash was available  to sustain operations,
which would cover the Company's planned activities through September 2006, at a
minimum.   The working capital deficit as of December 31, 2005  was  $1,040,900
and approximately  $17,000  cash was available.  We may seek additional capital
from  the  sale of restricted shares  of  common  stock  in  private  placement
transactions  in  Canada,  loans  from  directors, or possible funding or joint
venture arrangements with other mining companies.

      The Company did not have sales of cinder  materials  during the six-month
period ended June 30, 2006, compared with sales of $11,400 and  gross profit of
$2,000 for the six-month period ended June 30, 2005.  The Company  sustained  a
net  loss of $307,400 for the six-month period ended June 30, 2006, compared to
a net  loss  of  $289,300  for  the  six-month  period  ended  June  30,  2005,
representing  an  increase of $18,200. The aforementioned change is principally
due to the transactions outlined below:

      The Decreases in general and administrative e
xpenses during the six-month
period ended June 30, 2006 compared to the same period in 2005 were as follows:

   	-  Officer  salaries  decreased  by  $37,000, due to the resignation of
      Anthony Ciali.

   	-  Payroll taxes decreased by $4,800, due to the resignation of Anthony
      Ciali.

  	-  Office rent decreased by $6,300, due  to  the  closing  of  the  New
      Jersey branch office.

   	-  Office  life and health insurance expenses decreased by $700, due to
      the resignation of Anthony Ciali.

   	-  Vehicle lease expenses decreased by $1,500 due to the resignation of
      Anthony Ciali.

   	-  Vehicle expenses  decreased  by  $1,000  due  to  the resignation of
      Anthony Ciali.

   	-  Travel  expenses  decreased  by  $9,900  due  to  less international
      travel.

   	-  General office expenses and utilities decreased by $5,300 due to the
      closing of the New Jersey branch office.

   	- Stock based compensation decreased by $77,500 due to  less  activity
      on the Mexican properties.

         The  Increases in general and administrative expenses during the  six-
month period ended  June  30,  2006 compared to the same period in 2005 were as
follows:

   	-  Interest  expenses increased  by  $16,800  due  to  the  convertible
      debenture.

   	-  Beneficial  conversion  discount expense increased by $21,000 due to
      the convertible debenture.

   	-  Production  and assay report  expenses  increased  by  $800  due  to
      increased activity on US properties.

   	-  Officer and consultant  expenses  increased  by  $123,500 due to the
      granting of Options in accordance with FASB 123R (revised  2004)  "Share-
      based  Payment", the Company recognized the fair value of the options  in
      the statement  of  operations  on  the  date  of  grant.   Fair value was
      determined  using  the  Black Scholes option pricing model based  on  the
      following assumptions: expected  dividends:  $-0-;  volatility: 86%; risk
      free interest rate: 4.92% to 5.16%.


      Net  cash used by operating activities amounted to approximately  $88,400
for the six-month  period  ended  June  30,  2006,  compared with approximately
$109,600  for  the  same period in 2005, principally reflecting  the  decreased
level  of  general and  administrative  expenses.   The  Company  financed  its
activities principally  through  the  issuance  of  restricted shares of common
stock, which amounted to approximately $112,800 for the  six-month period ended
June 30, 2006 compared to approximately $153,600 for the same period in 2005.

      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.

ITEM 3.     CONTROLS AND PROCEDURES

      In the 90 day period  before  the  filing  of this report, the certifying
officer  of  the  Company  has  evaluated the effectiveness  of  the  company's
disclosure controls and procedures.   These  disclosure controls and procedures
are  those controls and other procedures we maintain,  which  are  designed  to
insure  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.


            As  of  the  end  of the period covered by this report, the Company
conducted an evaluation, under  the  supervision  and with the participation of
the  Chief  Executive  Officer and Chief Financial Officer,  of  the  Company's
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the 1934 Act. Based  on  this evaluation, the Chief Executive Officer and
Chief Financial Officer concluded  that there was a deficiency in the Company's
disclosure controls and procedures relating  to the reporting and disclosure of
shares  of common stock and options issued for  services  rendered  during  the
quarter ended  June 30, 2006. This deficiency was communicated to the Company's
independent registered  public  accountants.  The  Company determined that this
deficiency did not result in any omission of disclosures  in,  or misstatements
to, the Company's financial statements for any prior periods or for the quarter
ended  June  30,  2006.  The  Company  also performed additional procedures  in
completing these financial statements for  the  quarter  ended June 30, 2006 to
ensure that the amounts and disclosures included were fairly  presented  in all
material respects in accordance with GAAP.


      Subsequent  to  the  identification  of  the  deficiency in the Company's
disclosure controls and procedures as described above,  the  Company  performed
and  implemented  a  variety of additional procedures, including utilizing  the
services of a  consultant to serve in a review capacity on an ongoing basis, in
order  to  remediate the  above  described  deficiency.  As  a  result  of  the
implementation  of  these  additional procedures, 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.


      Other than as described above, there was no change in the Company's
internal control over financial reporting during the Company's most recently
completed fiscal quarter that has materially affected, or is reasonably likely
to materially affect, the Company's internal control over financial reporting.



PART II - OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

 None.

ITEM 2.  CHANGES IN SECURITIES.

       During the six  months  ended  June 30, 2006, we sold 564,000 restricted
common shares to 25 Canadian residents,  7 US residents and 5 Israeli Nationals
for a total of $112,800, and issued warrants  to  purchase  464,000  restricted
common shares, exercisable at $0.25 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 U.S. citizen, in  reliance  on  the  exemption  available  under
Section 4(2) of the 1933 Act.

      We  also issued, for services, 2,500 restricted common shares for a total
value of $875  and  these securities were issued to 1 U.S. resident in reliance
on the exemption provided by Section 4(2) of the 1933 Act.

      No commissions were paid in connection with these transactions

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

The Company is in default  of its semi-annual interest payment of $ 220,000 for
2002, 2003, 2004 2005 and 2006  on a note payable of $300,000, but 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

APRIL 4, 2006 8-K REPORT TO THE SEC





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 21, 2006			By:  /s/  Ronald D. Sloan
					-------------------------------------
					RONALD D. SLOAN,
					Chief Executive Officer and President