UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON,
      D.C. 20549





FORM
      10-Q/A


(Amendment
        No. 1)





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


For
      the
      fiscal quarter ended June 30, 2008





o
      Transition Report under
      Section 13 or 15(d) of the Securities Exchange Act of 1934.


For
      the
      transition period from _____ to _____.





Commission
      File No. 0-26669





Can-Cal
      Resources Ltd.


(Name
      of
      Small Business Issuer in its charter)




Nevada
              88-0336988(State
                  or other jurisdiction of
                  incorporation
                    or organization)
              (I.R.S.
                  Employer Identification No.)


2500
      Vista Mar Drive, Las Vegas, NV 89128


(Address
      of principal executive offices)





(702)
      243-1849


(Issuer's
      telephone number)





N/A


(Former
      name, former address and former fiscal year, if changed since last
      report)





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 12 months (or for such shorter period
      that the registrant was required to file such reports), and (2) has been subject
      to such filing requirements for the past 90 days. Yes x No o





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 14, 2008Common
                  Stock, Par Value $.001.
              
              24,587,753





Transitional
      Small Business Disclosure Format (Check one): Yes o No x


EXPLANATORY
        NOTE
  This
        quarterly report on Form 10-Q/A (“Form 10-Q/A”) for the fiscal quarter
        ended June 30, 2008 is filed to amend the following:
  ·
            Footnote
                #6, within Item 7 of Part I to present the Company’s financial statements
                in accordance with the required presentation. As an Exploration Stage
                Company, under paragraph 11 of SFAS 7 the Company has to include
                certain
                unaudited “inception to date” amounts, including the details of all the
                terms of each stock issuance from
                inception.  ·
            To
                remove extraneous pages #8 and #9 that were mistakenly included in
                the
                filing during submission.  Events
        have taken place that would have been reflected in the original Form 10-Q
        if
        they had taken place prior to the date of the original and amended filings.
        The
        Company recommends this report be read in conjunction with the Company’s reports
        filed subsequent to August 20, 2008.







CAN
      CAL
      RESOURCES, LTD.


(An
      Exploration Stage Company)




JUNE
      30,
      2008 QUARTERLY REPORT ON FORM 10-Q




TABLE
      OF
      CONTENTS




PAGE
                  NO.PART
                  I.
              
              FINANCIAL
                  INFORMATION
              
              4ITEM
                  1.
              
              FINANCIAL
                  STATEMENTS
              
              4Balance
                  Sheets
              
              4Statements
                  of Operations
              
              5Statements
                  of Stockholders’ Equity (Deficit)
              
              6Statements
                  of Cash Flows
              
              7Notes
                  to Financial Statements
              
              8ITEM
                  2.
              
              Management's
                  Discussion and Analysis of  Financial
                  Condition
              
              18ITEM
                  3.
              
              Quantitative
                  and Qualitative Disclosures about Market Risk
              24ITEM
                  4.
              
              Controls
                  and Procedures
              
              24PART
                  II.
              
              OTHER
                  INFORMATION
              
              25ITEM
                  1.
              
              Legal
                  Proceedings
              
              25ITEM
                  2.
              
              Changes
                  in Securities
              
              25ITEM
                  3.
              
              Defaults
                  upon Senior Securities
              
              25ITEM
                  4.
              
              Submission
                  of Matters to a Vote of Security Holders
              
              25ITEM
                  5.
              
              Other
                  information
              
              25ITEM
                  6.
              
              Exhibits
                  and Reports on Form 8-K
              
              26SignaturesCertifications




2




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.





3




PART
      I.
      FINANCIAL INFORMATION




**Can-Cal
                  Resources Ltd.****(An
                  Exploration Stage Company)****Condensed
                  Balance Sheets**
  June
                  30,
              
              December
                  31,2008
              
              2007(Unaudited)
              
              (Audited)ASSETSCurrent
                  assetsCash
              
              $
              72,827
              
              $
              105,987Other
                  current assets
              
              
              5,100
              
              
              -Total
                  current assets
              
              
              77,927
              
              
              105,987Property,
                  equipment and mineral interests (net of accumulateddepreciation
                  of $131,890 and $125,894)
              
              
              505,725
              
              
              511,720Other
                  assets, net
              
              
              1,895
              
              
              1,895Total
                  assets
              
              $
              585,547
              
              $
              619,602LIABILITIES
                  AND STOCKHOLDERS' DEFICITCurrent
                  liabilitiesAccounts
                  payable
              
              $
              23,868
              
              $
              28,399Accrued
                  interest
              
              
              339,391
              
              
              311,320Accrued
                  officer salary
              
              
              160,149
              
              
              110,652Accrued
                  payroll taxes
              
              
              458
              
              
              21,853Notes
                  payable, related parties
              
              
              395,630
              
              
              360,550Notes
                  payable
              
              
              83,500
              
              
              -Unearned
                  revenues
              
              
              47,061
              
              
              9,375Total
                  current liabilities
              
              
              1,050,057
              
              
              842,149Total
                  liabilities
              
              
              1,050,057
              
              
              842,149Stockholders'
                  deficitPreferred
                  stock; $0.001 par value; 10,000,000 sharesauthorized,
                  no shares issued and outstanding
              
              
              -
              
              
              -Common
                  stock; $0.001 par value; 100,000,000 shares authorized,24,587,753
                  and 24,555,253 shares issued and outstanding,
                  respectively
              
              
              24,588
              
              
              24,555Additional
                  paid-in capital
              
              
              7,831,503
              
              
              7,823,411Accumulated
                  deficit
              
              
              (8,320,601
              )
              
              (8,070,513
              )Total
                  stockholders' deficit
              
              
              (464,510
              )
              
              (222,547
              )Total
                  liabilities and stockholders' deficit
              
              $
              585,547
              
              $
              619,602
  See
        Accompanying Notes to Financial Statements
  4
 **Can-Cal
                    Resources Ltd.****(An
                    Exploration Stage Company)****Condensed
                    Statements of Operations****(Unaudited)**
  For
                        the Three Months Ended
                      June
                        30,
                
                For
                        the Six Months Ended
                      June
                        30,
                
                March
                          22, 1995
                        (Inception)
                        to
                          June 30,2008
                
                2007
                
                2008
                
                2007
                
                2008Material
                    sales
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                245,500Cost
                    of sales
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                263,400Gross
                    profit
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (17,900
                )Operating
                    expensesExploration
                    costs
                
                
                20,991
                
                
                55,635
                
                
                38,905
                
                
                102,943
                
                
                407,432Depreciation
                
                
                2,998
                
                
                3,816
                
                
                5,995
                
                
                6,021
                
                
                226,320General
                    and administrative
                
                
                85,645
                
                
                58,251
                
                
                142,640
                
                
                106,745
                
                
                5,899,666Officer
                    compensation
                
                
                29,008
                
                
                32,886
                
                
                60,000
                
                
                64,052
                
                
                671,176Total
                    operating expenses
                
                
                138,642
                
                
                150,588
                
                
                247,540
                
                
                279,761
                
                
                7,204,594Loss
                    from operations
                
                
                (138,642
                )
                
                (150,588
                )
                
                (247,540
                )
                
                (279,761
                )
                
                (7,222,494
                )Other
                    income (expense)Other
                    income from legal judgement
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                47,200Interest
                    income
                
                
                4
                
                
                3,505
                
                
                102
                
                
                6,959
                
                
                52,890Rental
                    revenue
                
                
                16,689
                
                
                5,625
                
                
                26,614
                
                
                11,250
                
                
                258,614Gain
                    (loss) on sale of fixed assets
                
                
                -
                
                
                3,701
                
                
                -
                
                
                3,701
                
                
                26,801Interest
                    expense
                
                
                (15,460
                )
                
                (14,307
                )
                
                (29,264
                )
                
                (28,887
                )
                
                (1,010,012
                )Total
                    other income (expense)
                
                
                1,233
                
                
                (1,476
                )
                
                (2,548
                )
                
                (6,977
                )
                
                (624,507
                )Loss
                    before provision for income taxes
                
                
                (137,409
                )
                
                (152,064
                )
                
                (250,088
                )
                
                (286,738
                )
                
                (7,847,001
                )Provision
                    for income taxes
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -Net
                    loss from continuing operations
                
                
                (137,409
                )
                
                (152,064
                )
                
                (250,088
                )
                $
                (286,738
                )
                
                (7,847,001
                )Income
                    from discontinued operationsIncome
                    (loss) from discontinued operations
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                116,400Gain
                    (loss) on disposal of operations (net of taxes)
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (590,000
                )Net
                    loss
                
                $
                (137,409
                )
                $
                (152,064
                )
                $
                (250,088
                )
                $
                (286,738
                )
                $
                (8,320,601
                )Basic
                    loss per common share
                
                $
                (0.01
                )
                $
                (0.01
                )
                $
                (0.01
                )
                $
                (0.01
                )Basic
                    weighted average common shares outstanding
                
                
                24,587,753
                
                
                24,157,828
                
                
                24,584,884
                
                
                23,922,171
 See
          Accompanying Notes to Financial Statements
  5
 **Can-Cal
            Resources Ltd.**
 **(An
                Exploration Stage Company)**
 **Condensed
                  Statement of Stockholders' Equity (Deficit)**
 **(Unaudited)**
 ForeignCommon
                        Stock
                    
                    Additional
                    
                    
                    
                    Currency
                    
                    
                    
                    TotalNumber
                        of
                    
                    
                    
                    Paid-in
                    
                    
                    
                    Translation
                    
                    Accumulated
                    
                    Stockholders'Shares
                    
                    Amount
                    
                    Capital
                    
                    Unamortized
                    
                    Adjustment
                    
                    (Deficit)
                    
                    (Deficit)Balance
                        March 22, 1995
                    
                    
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -Common
                        shares issued for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,000
                    )
                    
                    (1,000
                    )Balance
                        December 31, 1995
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,000
                    )
                    
                    (1,000
                    )Common
                        shares issued for services
                    
                    
                    3,441,217
                    
                    
                    3,400
                    
                    
                    625,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    628,400Prior
                        period adjustment, investment in joint venture
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    497,900
                    
                    
                    497,900Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (497,000
                    )
                    
                    (497,000
                    )Balance
                        December 31, 1996
                    
                    
                    3,441,217
                    
                    
                    3,400
                    
                    
                    625,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (100
                    )
                    
                    628,300Common
                        shares issued for services
                    
                    
                    3,006,435
                    
                    
                    3,000
                    
                    
                    1,051,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    1,054,400Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,044,700
                    )
                    
                    (1,044,700
                    )Balance
                        December 31, 1997
                    
                    
                    6,447,652
                    
                    
                    6,400
                    
                    
                    1,676,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,044,800
                    )
                    
                    638,000Common
                        shares issued for cash
                    
                    
                    557,509
                    
                    
                    600
                    
                    
                    211,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    211,800Foreign
                        currency translation adjustment
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,500
                    
                    
                    -
                    
                    
                    8,500Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (353,000
                    )
                    
                    (353,000
                    )Balance
                        December 31, 1998
                    
                    
                    7,005,161
                    
                    
                    7,000
                    
                    
                    1,887,600
                    
                    
                    -
                    
                    
                    8,500
                    
                    
                    (1,397,800
                    )
                    
                    505,300Common
                        shares issued for cash
                    
                    
                    1,248,621
                    
                    
                    1,200
                    
                    
                    572,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    573,800Foreign
                        currency translation adjustment
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (11,800
                    )
                    
                    -
                    
                    
                    (11,800
                    )Realized
                        foreign currency translation loss
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    3,300
                    
                    
                    -
                    
                    
                    3,300Prior
                        period Adjustment
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    15,000
                    
                    
                    15,000Elimination
                        of subsidiary upon disposal
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    116,400
                    
                    
                    116,400Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,038,500
                    )
                    
                    (1,038,500
                    )Balance
                        December 31, 1999
                    
                    
                    8,253,782
                    
                    
                    8,200
                    
                    
                    2,460,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (2,304,900
                    )
                    
                    163,500Common
                        shares issued for cash
                    
                    
                    1,119,009
                    
                    
                    1,200
                    
                    
                    948,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    949,600Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (962,500
                    )
                    
                    (962,500
                    )Balance
                        December 31, 2000
                    
                    
                    9,372,791
                    
                    
                    9,400
                    
                    
                    3,408,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (3,267,400
                    )
                    
                    150,600Common
                        shares issued for cash
                    
                    
                    785,947
                    
                    
                    800
                    
                    
                    81,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    82,300Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (704,500
                    )
                    
                    (704,500
                    )Balance
                        December 31, 2001
                    
                    
                    10,158,738
                    
                    
                    10,200
                    
                    
                    3,490,100
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (3,971,900
                    )
                    
                    (471,600
                    )Common
                        shares issued for cash
                    
                    
                    1,093,280
                    
                    
                    1,100
                    
                    
                    269,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    271,000Common
                        shares issued for services
                    
                    
                    92,292
                    
                    
                    100
                    
                    
                    23,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    23,900Options
                        granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,100
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,100Common
                          shares issued for repayment of note payable, related party
                          in the amount
                          of $119,800, including accrued interest of $71,800
                    
                    
                    309,677
                    
                    
                    300
                    
                    
                    119,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    119,800Warrants
                        granted for loan fees onconvertible
                        notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    16,700
                    
                    
                    (16,700
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    -Common
                        shares issued for loan fees onconvertible
                        notes payable, related party
                    
                    
                    30,000
                    
                    
                    -
                    
                    
                    13,500
                    
                    
                    (13,500
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    -Deemed
                        interest on beneficial conversionfeature
                        of notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    20,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    20,500Amortization
                        of loan fees
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,200Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (709,300
                    )
                    
                    (709,300
                    )Balance
                        December 31, 2002
                    
                    
                    11,683,987
                    
                    
                    11,700
                    
                    
                    3,961,100
                    
                    
                    (22,000
                    )
                    
                    -
                    
                    
                    (4,681,200
                    )
                    
                    (730,400
                    )Common
                        shares issued for cash
                    
                    
                    823,410
                    
                    
                    800
                    
                    
                    163,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    164,700Common
                        shares issued for services
                    
                    
                    381,260
                    
                    
                    400
                    
                    
                    63,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    64,200Options
                        granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    61,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    61,300Common
                          shares issued for repayment of note payable, related party
                          in the amount
                          of $78,300, including accrued interest of $43,300
                    
                    
                    364,305
                    
                    
                    400
                    
                    
                    77,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    78,300Deemed
                        interest on beneficial conversionfeature
                        of notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    38,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    38,300Amortization
                        of loan fees
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    15,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    15,000Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (711,100
                    )
                    
                    (711,100
                    )Balance
                        December 31, 2003
                    
                    
                    13,252,962
                    
                    
                    13,300
                    
                    
                    4,366,300
                    
                    
                    (7,000
                    )
                    
                    -
                    
                    
                    (5,392,300
                    )
                    
                    (1,019,700
                    )Common
                        shares issued for cash
                    
                    
                    1,564,311
                    
                    
                    1,600
                    
                    
                    306,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    308,000Common
                        shares issued for exercise of warrants
                    
                    
                    701,275
                    
                    
                    700
                    
                    
                    124,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    125,600Common
                        shares issued for services
                    
                    
                    390,224
                    
                    
                    400
                    
                    
                    73,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    74,200Warrants
                        granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    12,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    12,200Interest
                        expense for warrants granted
                    
                    
                    -
                    
                    
                    -
                    
                    
                    280,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    280,200Common
                        shares issued in satisfaction of accounts payableand
                        accrued liabilities in the amount of $229,400
                    
                    
                    917,747
                    
                    
                    900
                    
                    
                    228,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    229,400Common
                        shares issued for repayment of note payable in theamount
                        of $99,700, including accrued interest of $14,700
                    
                    
                    702,760
                    
                    
                    700
                    
                    
                    99,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    99,700Common
                        shares issued for repayment of note payable,related
                        party in the amount of $82,700
                    
                    
                    330,747
                    
                    
                    300
                    
                    
                    82,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    82,700Deemed
                        interest on beneficial conversionfeature
                        of notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    17,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    17,600Amortization
                        of loan fees
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,000Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,030,500
                    )
                    
                    (1,030,500
                    )Balance
                        December 31, 2004
                    
                    
                    17,860,026
                    
                    
                    17,900
                    
                    
                    5,591,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (6,422,800
                    )
                    
                    (813,600
                    )Common
                        shares issued for cash
                    
                    
                    762,500
                    
                    
                    800
                    
                    
                    152,700
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    153,500Common
                        shares issued for exercise of warrants
                    
                    
                    349,545
                    
                    
                    300
                    
                    
                    69,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    69,800Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (421,800
                    )
                    
                    (421,800
                    )Balance
                        December 31, 2005
                    
                    
                    18,972,071
                    
                    
                    19,000
                    
                    
                    5,813,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (6,844,600
                    )
                    
                    (1,012,100
                    )Common
                        shares issued for cash
                    
                    
                    2,448,213
                    
                    
                    2,400
                    
                    
                    642,100
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    644,500Common
                        warrants exercised for cash
                    
                    
                    174,000
                    
                    
                    200
                    
                    
                    43,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    43,500Common
                        shares issued for services
                    
                    
                    19,500
                    
                    
                    -
                    
                    
                    5,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    5,000Common
                        shares issued in satisfaction of accountspayable
                        and accrued liabilities
                    
                    
                    385,714
                    
                    
                    400
                    
                    
                    80,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    81,000Common
                        shares issued in satisfaction of notespayable-related
                        parties
                    
                    
                    56,821
                    
                    
                    100
                    
                    
                    11,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    11,900Common
                        shares issued in satisfaction of convertibledebenture,
                        (including accrued interest of $1,895)
                    
                    
                    206,767
                    
                    
                    200
                    
                    
                    41,700
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    41,900Common
                        shares issued for asset acquisition
                    
                    
                    1,000,000
                    
                    
                    1,000
                    
                    
                    399,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    400,000Option
                        granted to officers and directors
                    
                    
                    -
                    
                    
                    -
                    
                    
                    123,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    123,500Warrants
                        granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,200Warrants
                        granted in satisfaction of accountspayable
                        and accrued liabilities
                    
                    
                    -
                    
                    
                    -
                    
                    
                    65,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    65,400Warrants
                        granted in satisfaction of notespayable-related
                        parties
                    
                    
                    -
                    
                    
                    -
                    
                    
                    9,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    9,600Warrants
                        granted in satisfaction of convertibledebenture
                    
                    
                    -
                    
                    
                    -
                    
                    
                    40,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    40,000Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (621,000
                    )
                    
                    (621,000
                    )Balance
                        December 31, 2006
                    
                    
                    23,263,086
                    
                    
                    23,264
                    
                    
                    7,277,736
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (7,465,600
                    )
                    
                    (164,600
                    )Common
                        shares issued for cash
                    
                    
                    492,795
                    
                    
                    492
                    
                    
                    188,698
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    189,190Common
                        warrants exercised for cash
                    
                    
                    745,372
                    
                    
                    745
                    
                    
                    185,598
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    186,343Common
                        shares issued for services
                    
                    
                    4,000
                    
                    
                    4
                    
                    
                    2,010
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,014Common
                        shares issued in satisfaction ofaccrued
                        wages of $22,000, related party
                    
                    
                    50,000
                    
                    
                    50
                    
                    
                    21,950
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    22,000Debt
                        forgiveness, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    147,419
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    147,419Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (604,913
                    )
                    
                    (604,913
                    )Balance
                        December 31, 2007
                    
                    
                    24,555,253
                    
                    
                    24,555
                    
                    
                    7,823,411
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (8,070,513
                    )
                    
                    (222,547
                    )Common
                        shares issued for cash
                    
                    
                    32,500
                    
                    
                    33
                    
                    
                    8,092
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,124Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (112,679
                    )
                    
                    (112,679
                    )Balance,
                        March 31, 2008
                    
                    
                    24,587,753
                    
                    
                    24,588
                    
                    
                    7,831,503
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (8,183,192
                    )
                    
                    (327,102
                    )Net
                        loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (137,409
                    )Balance,
                        June 30, 2008
                    
                    
                    24,587,753
                    
                    $
                    24,588
                    
                    $
                    7,831,503
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    (8,320,601
                    )
                    $
                    (327,102
                    )
  See
            Accompanying Notes to Financial Statements
 6
 **Can-Cal
                        Resources Ltd.****(An
                        Exploration Stage Company)****Condensed
                        Statements of Cash Flows****(Unaudited)**
  For
                            the Six Months Ended
                          June
                            30,
                    
                    March
                              22, 1995
                            (Inception)
                            to
                              June 30,2008
                    
                    2007
                    
                    2008Cash
                        flows from operating activities:Net
                        loss
                    
                    $
                    (250,088
                    )
                    $
                    (286,738
                    )
                    $
                    (8,320,601
                    )Adjustments
                        to reconcile net loss to netcash
                        used by operating activities:Depreciation
                        and amortization
                    
                    
                    5,995
                    
                    
                    6,021
                    
                    
                    243,320Bad
                        debts
                    
                    
                    -
                    
                    
                    -
                    
                    
                    207,100(Gain)
                        loss on sale of fixed assets
                    
                    
                    -
                    
                    
                    (3,701
                    )
                    
                    (6,501
                    )Stock
                        based compensation
                    
                    
                    -
                    
                    
                    24,000
                    
                    
                    532,814Stock
                        issued for financing and interest
                    
                    
                    -
                    
                    
                    -
                    
                    
                    523,200Beneficial
                        conversion feature on convertible debts
                    
                    
                    -
                    
                    
                    -
                    
                    
                    25,200Loss
                        on disposal of investment property
                    
                    
                    -
                    
                    
                    -
                    
                    
                    938,600Undistributed
                        earnings of affiliate
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (174,300
                    )Gain
                        on discontinued operations
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (116,400
                    )Loss
                        on foreign currency translation
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,500Decrease
                        (increase) in assets:Accounts
                        receivable
                    
                    
                    -
                    
                    
                    3,600
                    
                    
                    -Other
                        current assets
                    
                    
                    (5,100
                    )
                    
                    -
                    
                    
                    (95,800
                    )Other
                        assets
                    
                    
                    -
                    
                    
                    (34
                    )
                    
                    (1,895
                    )Increase
                        (decrease) in liabilities:Accounts
                        payable
                    
                    
                    (4,531
                    )
                    
                    (11,570
                    )
                    
                    23,868Accrued
                        interest
                    
                    
                    28,071
                    
                    
                    24,231
                    
                    
                    339,391Accrued
                        officer salary
                    
                    
                    49,497
                    
                    
                    (51,256
                    )
                    
                    160,149Accrued
                        payroll taxes
                    
                    
                    (21,395
                    )
                    
                    -
                    
                    
                    458Unearned
                        revenues
                    
                    
                    37,686
                    
                    
                    11,225
                    
                    
                    47,061Net
                        cash used by operating activities
                    
                    
                    (159,865
                    )
                    
                    (284,222
                    )
                    
                    (5,665,836
                    )Cash
                        flows from investing activities:Purchase
                        of investment property
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,083,600
                    )Proceeds
                        from sale of investment property
                    
                    
                    -
                    
                    
                    -
                    
                    
                    319,300Purchase
                        of property, equipment and mineral interests
                    
                    
                    -
                    
                    
                    (51,788
                    )
                    
                    (768,644
                    )Proceeds
                        from sale of property, equipment and mineral interests
                    
                    
                    -
                    
                    
                    7,000
                    
                    
                    26,100Net
                        cash used in investing activities
                    
                    
                    -
                    
                    
                    (44,788
                    )
                    
                    (1,506,844
                    )Cash
                        flows from financing activities:Proceeds
                        from notes payable
                    
                    
                    83,500
                    
                    
                    -
                    
                    
                    773,400Principal
                        payments on notes payable
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (689,900
                    )Proceeds
                        from notes payable, related parties
                    
                    
                    40,000
                    
                    
                    -
                    
                    
                    727,800Principal
                        payments on notes payable, related parties
                    
                    
                    (4,920
                    )
                    
                    (23,116
                    )
                    
                    (332,170
                    )Proceeds
                        from issuance of common stock
                    
                    
                    8,125
                    
                    
                    292,145
                    
                    
                    6,766,377Net
                        cash provided by financing activities
                    
                    
                    126,705
                    
                    
                    269,029
                    
                    
                    7,245,507Net
                        increase (decrease) in cash
                    
                    
                    (33,160
                    )
                    
                    (59,981
                    )
                    
                    72,827Cash,
                        beginning of period
                    
                    
                    105,987
                    
                    
                    419,700
                    
                    
                    -Cash,
                        end of period
                    
                    $
                    72,827
                    
                    $
                    359,719
                    
                    $
                    72,827Supplemental
                        disclosure of cash flow information:Cash
                        paid for income taxes
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -Cash
                        paid for interest
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
  See
                Accompanying Notes to Financial Statements
 7
  CAN-CAL
        RESOURCES LTD
 (An
          Exploration Stage Company)
 NOTES
        TO
        FINANCIAL STATEMENTS
 (UNAUDITED)
  1.
              BASIS
                  OF PRESENTATION
 
 The
        accompanying unaudited condensed 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,
        2007 of
        Can-Cal Resources Ltd (“the Company”).
 
 The
        interim condensed financial statements present the balance sheets, 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 (which include normal recurring adjustments) necessary to present
        fairly the financial position as of June 30, 2008 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.
 
 Certain
        amounts in the prior periods presented have been reclassified to conform
        to the
        current period financial statement presentation.
 
 Exploration
        Stage Company
  The
        Company is currently an exploration stage company. As an exploration stage
        enterprise, the Company discloses the deficit accumulated during the exploration
        stage and the cumulative statements of operations and cash flows from inception
        to the current balance sheet date. The Company has incurred net losses of
        $8,320,601 and used net cash in operations of $5,665,836 for the period from
        inception (March 22, 1995) through June 30, 2008. An entity remains in the
        exploration stage until such time as proven or probable reserves have been
        established for its deposits. Upon the location of commercially mineable
        reserves, the Company plans to prepare for mineral extraction and enter the
        development stage. To date, the exploration stage of the Company’s operations
        consists of contracting with geologists to sample and assess the mining
        viability of the Company’s claims.
  2.
              GOING
                  CONCERN
 
 The
        Company incurred a net loss of $250,088 for the six months ending June 30,
        2008.
        Also, the Company’s current liabilities exceed its current assets by $972,130 as
        of June 30, 2008. These factors create substantial doubt about the Company’s
        ability to continue as a going concern. The Company’s management plans to
        continue to fund its operations in the short term with a combination of debt
        and
        equity financing, as well as revenue from operations in the long
        term.
 
 The
        ability of the Company to continue as a going concern is dependent on additional
        sources of capital and the success of the Company’s plan. The financial
        statements do not include any adjustments that might be necessary if the
        Company
        is unable to continue as a going concern.
 
 3.
              CORRECTION
                  OF ERRORS
 
 The
        Company has restated its previously issued June 30, 2007 financial statements
        for matters related to the following previously reported items: a purchase
        of
        mineral rights on a mining claim located in Mohave County, Arizona in exchange
        for 1,000,000 shares of the Company’s common stock was incorrectly valued in the
        prior year. The Company originally recorded an asset value of $18,500 based
        on
        the actual costs to maintain the claim annually, however, in accordance with
        SFAS 123(R) the purchase of the mineral rights should have been valued based
        on
        the fair market value of the underlying shares of common stock exchanged
        which
        amounted to $400,000 given the $0.40 closing stock price on the date of
        purchase. The accompanying financial statements for the six month period
        ending
        June 30, 2007 have been restated to reflect the corrections in accordance
        with
        Statement of Accounting Standards Board No. 154, “Accounting Change and Error
        Correction”. The following is a summary of the restatements for June 30,
        2007:
  8
 CAN-CAL
          RESOURCES LTD
 NOTES
          TO
          FINANCIAL STATEMENTS
 (UNAUDITED)
 Increase
                  of previously reported other assets:-
                  unrecorded value of mineral rights acquired
              
              $
              381,500Increase
                  of previously reported additional paid in capital:-
                  unrecorded amount of additional paid in capital on stock
                  issuance
              
              $
              381,500
  The
        effect on the Company’s previously issued June 30, 2007 financial statements are
        summarized as follows:
 
 *Consolidated
        Balance Sheet as of June 30, 2007*
 
 *Previously
                  Reported*
              
              *Net*
                *Change*
              
              *Restated*AssetsCurrent
                  assetsCash
              
              $
              359,719
              
              $
              -
              
              $
              359,719Total
                  current assets
              
              
              359,719
              
              
              -
              
              
              359,719Fixed
                  assets, net
              
              
              61,468
              
              
              -
              
              
              61,468Other
                  assets, net
              
              
              49,134
              
              
              381,500
              
              
              430,634$
              470,321
              
              $
              381,500
              
              $
              851,821Current
                  liabilitiesAccounts
                  payable
              
              $
              22,630
              
              $
              -
              
              $
              22,630Accrued
                  interest
              
              
              286,731
              
              
              -
              
              
              286,731Accrued
                  officer salary
              
              
              127,010
              
              
              -
              
              
              127,010Accrued
                  payroll taxes
              
              
              70,089
              
              
              -
              
              
              70,089Notes
                  payable, related parties
              
              
              358,184
              
              
              -
              
              
              358,184Unearned
                  revenues
              
              
              20,625
              
              
              -
              
              
              20,625Total
                  current liabilities
              
              
              885,269
              
              
              -
              
              
              885,269Commitments
                  and contingencies
              
              
              -
              
              
              -
              
              
              -Stockholders’
                  deficitPreferred
                  stock
              
              
              -
              
              
              -
              
              
              -Common
                  stock
              
              
              24,276
              
              
              -
              
              
              24,276Additional
                  paid-in capital
              
              
              7,313,114
              
              
              381,500
              
              
              7,694,614Accumulated
                  deficit
              
              
              (7,752,338
              )
              
              -
              
              
              (7,752,338
              )Total
                  stockholders’ deficit
              
              
              (414,948
              )
              
              381,500
              
              
              (33,448
              )$
              470,321
              
              $
              381,500
              
              $
              851,821
 
 Also,
        in
        response to comments raised by the staff of the Securities and Exchange
        Commission (“SEC”) concerning the presentation of the financial statements
        included in our Annual Report on Form 10-KSB for the fiscal year ended December
        31, 2007 and our Quarterly Reports on Form 10-QSB for the quarter ended March
        31, 2008, coupled with our own internal investigation, and discussions with
        our
        independent registered public accounting firm, we concluded on August 15,
        2008
        that the audited condensed financial statements included in our Annual Report
        for the year ended December 31, 2007 and the unaudited condensed financial
        statements included in our Quarterly Report on Form 10-QSB for the three
        months
        ended March 31, 2008, (collectively referred to herein as the *“Financial
        Statements”* ),
        require restatement to correct the reporting of of mining transactions to
        be
        consistent with SEC Industry Guide 7, *Description
        of Property by Issuers Engaged or to Be Engaged in Significant Mining
        Operations* .
  9
 CAN-CAL
          RESOURCES LTD
 NOTES
          TO
          FINANCIAL STATEMENTS
 (UNAUDITED)
 Even
        though the Financial Statements have discussed the Company as and *“exploration
        stage”* company
        the Financial Statements present the Company as a *“production
        stage”* company
        through the omission of inception to date financial disclosures. SEC Industry
        Guide 7 defines a production stage company as one that has reserves that
        are
        proven or probable as evidenced by a reserve report. As we have not proven
        reserves, or began production as evidenced by our lack of significant revenues
        from our principal activity of mining, we would be considered an *“exploration
        stage”* company,
        rather than a production stage company.
 
 To
        present the Company as an exploration stage company we will restate the
        Financial Statements to add a column disclosing “ *inception
        to date”* amounts
        to the statements of operations and statements of cash flows. All other
        information was presented consistent with that of an exploration stage
        company.
  4.
              NOTES
                  PAYABLE, RELATED PARTIES
 
 Notes
        payable, related parties consisted of the following as of June 30,
        2008:
 Note
                        payable to a stockholder, secured by real property, bearing
                        interest at
                        16.0% per annum, semi-annual interest only payments,
                      matured
                        November 2005 (currently in default)
                
                $
                300,000Note
                    payable to a stockholder, secured by real property,
                    bearinginterest
                    at 8.0% per annum, matured February 2008 (currently in
                    default)
                
                
                25,114Note
                    payable to a stockholder, secured by real property,
                    bearinginterest
                    at 8.0% per annum, matured January 2008 (currently in
                    default)
                
                
                35,436Unsecured
                    promissory notes payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing May 7,
                    2009
                
                
                15,080Unsecured
                    promissory notes payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing June 6,
                    2009
                
                
                20,000Current
                    portion (amounts due within one year)
                
                $
                395,630
  The
        Company is in default of its semi-annual interest payments in the total amount
        of $316,000 from 2002 through the present on a note payable of $300,000.
        The
        Company is currently negotiating forbearance on collection of the principle
        and
        interest. Interest expense was $29,264 and $28,887 for the six months ending
        June 30, 2008 and 2007, respectively.
  5.
              NOTES
                  PAYABLE
 
 Notes
        payable consisted of the following as of June 30, 2008:
 Unsecured
                    promissory note payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing March 10,
                    2009
                
                $
                22,000Unsecured
                    promissory note payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing April 7,
                    2009
                
                
                7,500Unsecured
                    promissory note payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing March 10,
                    2009
                
                
                12,000Unsecured
                    promissory note payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing June 2,
                    2009
                
                
                12,000Unsecured
                    promissory note payable, bearing interest at 8.0% per
                    annum,and
                    a default interest rate of 12.0% per annum, maturing June 6,
                    2009
                
                
                30,000Current
                    portion (amounts due within one year)
                
                $
                83,500
  10
 CAN-CAL
          RESOURCES LTD
 NOTES
          TO
          FINANCIAL STATEMENTS
 (UNAUDITED)
 6.
              CHANGES
                  IN SECURITIES
 1996
 
 During
          1996 the Company issued 3,441,217 shares of Can-Cal common stock to various
          investors resulting in cash proceeds of $628,400.
  1997
 
 On
          January 15, 1997 the Company issued 500,000 shares of Can-Cal common stock
          along
          with a cash payment of $100,000 in exchange for a 50% interest in S&S Joint
          Venture. Additionally, the Company agreed to loan the joint venture up
          to
          $48,000.
 
 On
          February 13, 1997 the Board approved the acquisition of Scotmar Industries,
          Inc.
          200,000 shares of Can-Cal common stock were issued in return for all of
          the
          issued and outstanding stock of the acquired company.
 
 On
          October 27, 1997 the Board approved the issuance of 2,181,752 restricted
          common
          shares to ARUM, LLC to repay an existing debt of approximately $315,045.98
          and
          to purchase a property located in San Bernadino County, California, known
          as the
          Pisgah property.
 
 During
          November, 1997 the Board approved the sale of 124,683 restricted common
          shares
          to various investors.
 
 During
          December, 1997 the Board approved the issuance of 42,000 restricted common
          shares in return for services rendered.
  1998
 
 In
          July,
          1998 the Board approved the issuance 122,000 restricted common shares to
          various
          investors.
 
 In
          October, 1998 the Board approved the sale of 172,450 restricted common
          shares to
          various investors.
 
 During
          December, 1998 the Board approved the sale of 263,059 restricted common
          shares
          to various investors.
  1999
 
 On
          February 1, 1999, the Board of Directors approved the Sale of 62,500 shares
          of
          Can-Cal common stock to a Board member.
 
 On
          February 8, 1999 the Board approved the sale of 70,000 shares of Can-Cal
          common
          stock to a Board member.
 
 On
          March
          1, 1999 the Board approved the issuance of 32,121 shares of Can-Cal common
          stock
          in return for services rendered.
 
 On
          March
          15, 1999 the Board approved the sale of 86,000 shares of Can-Cal common
          stock to
          various investors.
 
 On
          March
          17, 1999 the Board approved the issuance of 40,000 shares of Can-Cal common
          stock in return for equipment.
 
 On
          March
          10, 1999 the Board approved the sale of 295,500 shares of Can-Cal common
          stock
          to various investors.
 
 11
  On
          April
          1, 1999 the Board approved the sale of 1,000 restricted common stock in
          return
          for equipment.
 
 On
          July
          21, 1999 the Board approved the sale of 357,500 shares of common stock
          to
          various investors.
 
 On
          August
          24, 1999 the Board approved the sale of 274,000 shares of common stock
          to
          various investors.
 
 On
          September 7, 1999 the Board approved the sale of 20,000 shares of common
          stock
          to an investor.
 
 On
          November 9, 1999 the board approved the issuance of 10,000 shares of common
          stock to an investor.
  2000
 
 On
          February 27, 2000, the Board of Directors approved the sale of 500,000
          shares of
          common stock to three of its directors (all of whom reside in Canada),
          an
          offshore trust and another person affiliated with the Company.
 
 On
          July
          3, 2000, the Board of Directors exercised the option to acquire technology
          related to the extraction and processing of ore and, in accordance with
          the
          agreement with the two owners of that technology, issued 200,000 shares
          of
          Can-Cal's common stock to them.
 
 On
          November 24, 2000, the Company borrowed $300,000 from a lender. As part
          of the
          transaction, the Company issued 45,000 shares of its common stock as a
          loan
          placement fee and granted the lender an option to purchase up to 300,000
          shares
          of its common stock. On November 24, 2000, the lender exercised its option
          in
          full and purchased 300,000 shares of Can-Cal's common stock.
 
 In
          July
          2000 the Board of Directors authorized the sale of 74,009 shares of its
          common
          stock to eight persons, all of whom reside outside the United States. During
          the
          third quarter 46,670 shares were sold and the remaining 27,339 shares were
          sold
          during the fourth quarter. All of those shares were issued on December
          15,
          2000.
  2001
 
 In
          September, 2001, the Board of Directors authorized the sale of 20,000 shares
          of
          its common stock to an individual.
 
 During
          October, 2001 the company signed an Investment Agreement with two funds
          (Dutchess Private Equities Fund LP and DRH Investment Company LLC) to sell
          to
          those funds up to $8,000,000 in common stock of the company, for a period
          of
          three years. In connection with the Investment Agreement, the company issued
          606,059 shares of restricted common stock to Dutchess Fund and its advisor,
          and
          to a broker-dealer firm, for services valued at $400,000, to induce those
          entities to enter into the Investment Agreement and perform services
          contemplated under such agreement. The company also issued 37,000 shares
          of
          restricted common stock to the attorney for Dutchess Fund.
 
 On
          November 2, 2001 the Board of Directors approved the sale of 82,888 shares
          of
          restricted common stock.
 
 On
          December 12, 2001 the Board of Directors approved the sale of 40,000 shares
          of
          restricted common stock.
 
 12
 
 2002
 
 On
          January 8, 2002, we sold 36,000 restricted common shares to three investors
          (one
          Canadian resident, and two private companies controlled and owned by Canadian
          residents) for $12,600 cash ($0.35 per share, representing a discount of
          approximately 50% from market price). These investors also were issued
          warrants
          to purchase 36,000 additional restricted shares, at a price of $0.35 per
          share;
          the warrants will expire January 8, 2004.
 
 On
          February 11, 2002, 10,000 restricted common shares were sold to one investor
          (a
          Canadian resident) for $3,500 cash ($0.35 per share, representing a discount
          of
          approximately 50% from market price). This investor also was issued warrants
          to
          purchase 10,000 additional restricted shares, at a price of $0.35 per share;
          the
          warrants will expire February 11, 2004. Complete information about the
          company
          was provided to these investors. These shares and warrants were sold pursuant
          to
          the exemption provided by Regulation S of the 1933 Act. No commissions
          were
          paid.
 
 On
          January 31, 2002, we issued 309,677 restricted common shares to a lender
          (First
          Colony Merchant) for payment of past due and current interest on debt,
          $119,800.
          No commissions were paid.
 
 From
          March 1, 2002 through June 3, 2002, 369,600 restricted common shares were
          issued
          to 48 investors (all Canadian residents or companies controlled and owned
          by
          Canadian residents) for $92,400 cash ($0.25 per share, representing discounts
          ranging from 0% to approximately 50% from market prices at the time of
          issuance). These investors also were issued warrants to purchase 369,600
          additional restricted shares, at a price of $0.25 per share; the warrants
          will
          expire two years from the date of issuance. No commissions were
          paid.
 
 On
          June
          21, 2002, 40,000 restricted common shares were issued to Financial
          Communications Corp. for public relations services, valued at approximately
          $14,000.
 
 From
          July
          1, 2002 through December 24, 2002, 609,720 restricted common shares were
          issued
          to 20 investors (19 whom are Canadian residents or companies controlled
          and
          owned by Canadian residents, and one who is a resident of Great Britain)
          for
          $152,400 cash ($0.25 per share, representing prices that ranged from 22%
          over
          market to approximately 40% below market prices at the time of issuance).
          The
          investors also were issued warrants to purchase a total of 609,720 additional
          restricted shares, at a price of $0.25 per share; the warrants will expire
          two
          years from the date of issuance. No commissions were paid.
 
 During
          September 2002, the Company issued 32,281 shares of the Company's common
          stock
          for $5,500 in cash related to the Dutchess Private Equities Fund, net of
          offering costs of $200, and issued 30,000 shares to Joseph B. LaRocco,
          attorney
          for Dutchess Fund and DRH Investment Company, LLC for legal services to
          such
          entities.
 
 During
          October 2002, the Company issued 35,679 shares of the Company's common
          stock for
          $4,600 in cash related to the Dutchess Private Equities Fund, net of offering
          costs of $700.
 
 In
          November 2002, the Company issued 52,292 restricted common shares to four
          individuals in exchange for various services, valued at approximately
          $9,900.
  2003
 
 During
          2003, 673,410 restricted common shares were issued to 19 Canadian residents
          or
          companies controlled and owned by Canadian resident investors for $134,682
          and
          150,000 restricted common shares were issued to 12 U.S. resident investors
          for
          $30,000 (all shares were priced at $0.20 per share, representing premiums
          of up
          to 25% and discounts ranging from 0% to approximately 25% from market prices
          at
          the time of issuance). With respect to 237,410 restricted common shares,
          the
          investors were also issued warrants to purchase 474,820 additional restricted
          common shares and with respect to 473,500 restricted common shares, the
          investors were also issued warrants to purchase 473,500 additional restricted
          common shares; all warrants were priced at $0.20 per share and will expire
          two
          years from the date of issuance. With respect to 112,500 restricted common
          shares, the investors were also issued 112,500 warrants to purchase additional
          restricted common shares, at a price of $0.25 per share for a period of
          two
          years from the date of issuance. The shares and warrants were sold to Canadian
          investors pursuant to the exemption provided by Regulation S of the 1933
          Act,
          and the shares and warrants sold to U.S. investors were sold pursuant to
          the
          exemption provided by section 4(2) of the 1933 Act.
 
 13
  During
          2003, 364,305 restricted common shares were issued in conversion of $35,000
          principal and interest on a debenture held by Dutchess Fund. The conversion
          prices were $0.099 for 50,710 shares ($5,000 of the debenture); $0.112
          for
          44,643 shares ($5,000 of the debenture); $0.061 for 81,433 shares ($5,000
          of the
          debenture); $0.067 for 75,075 shares ($5,000 of the debenture); and $0.1334
          for
          112,444 shares ($15,000 of the debenture). All of the prices were determined
          by
          the conversion formula in the debenture (80% of the average bid prices
          for the
          three lowest (out of 15) trading days before conversion. These shares were
          sold
          pursuant to the exemption provided by section 4(2) of the 1933 Act.
 
 During
          2003, 205,166 restricted common shares in payment of $31,500 of services
          by Luis
          Vega, consulting geologist. The per share price was determined by dividing
          the
          amount owed by the average closing price of the company's stock for each
          day's
          service. These shares were sold pursuant to the exemption provided by section
          4(2) of the 1933 Act.
 
 On
          March
          14, 2003, 24,960 restricted common shares were issued to Catherine Nichols,
          a
          Canadian resident, for marketing services amounting to $5,000. The price
          per
          share was based on the average closing share price for the period during
          which
          the services were rendered. These shares were sold pursuant to the exemption
          provided by Regulation S of the 1933 Act.
 
 During
          the period from July 15 to December 31, 2003, 112,326 restricted common
          shares
          in payment of $22,250 of investor relations services by Jeffrey Whitford,
          a
          Canadian resident who is a consultant to the company. The price per share
          was
          based on the average monthly closing share prices for the period. These
          shares
          were sold pursuant to the exemption provided by Regulation S of the 1933
          Act.
 
 33,600
          restricted common shares were issued to pay $4,200 of legal services provided
          by
          Stephen E. Rounds, outside company counsel. The price per share was based
          on the
          average closing share price for the period during which the services were
          rendered. These shares were sold pursuant to the exemption provided by
          section
          4(2) of the 1933 Act.
 
 On
          December 30, 2003, 5,208 restricted common shares were issued to Terry
          Brown, a
          Mexican resident, for technical consulting services amounting to $1,250.
          The
          price per share was based on the average closing share price for the period
          during which the services were rendered. These shares were sold pursuant
          to the
          exemption provided by Regulation S of the 1933 Act.
  2004
 
 During
          2004, 2,255,586 restricted common shares were issued to 107 Canadian residents
          or companies controlled and owned by Canadian resident investors for $431,425
          and 10,000 restricted common shares were issued to one U.S. resident investor
          for $2,000 (245,000 shares were priced at $0.18 per share, 1,620,131 shares
          were
          priced at $0.20 per share, 261,200 shares were priced at $0.25 per share,
          and
          139,255 shares were issued as a 25% premium on the conversion of warrants,
          representing premiums of up to 25% and discounts ranging from 0% to
          approximately 25% from market prices at the time of issuance). With respect
          to
          1,319,308 of these restricted common shares, the investors were also issued
          warrants to purchase 1,259,308 additional restricted common shares at $0.25
          per
          share and 60,000 additional restricted common shares at $0.20 per share.
          With
          respect to 245,000 restricted common shares, the investors were also issued
          warrants to purchase 245,000 additional restricted common shares at $0.25,
          and
          with respect to another 245,000 restricted common shares, the investors
          were
          also issued warrants to purchase 245,000 additional restricted common shares
          at
          $0.50 per share. Of these, we also sold 5,000 shares to a director of the
          Company for proceeds of $1,000 and issued warrants to purchase 5,000 restricted
          common shares, exercisable at $0.25 per share for a two year period. All
          warrants will expire two years from the date of issuance. The shares and
          warrants were sold to Canadian investors pursuant to the exemption provided
          by
          Regulation S of the 1933 Act, and the shares and warrants sold to U.S.
          investors
          were sold pursuant to the exemption provided by section 4(2) of the 1933
          Act.
 
 14
  During
          2004, 702,760 restricted common shares were issued in conversion of $99,657
          principal and interest on a debenture held by Dutchess Fund. The conversion
          prices were $0.216 for 92,593 shares ($20,000 of the debenture); $0.160
          for
          31,250 shares ($5,000 of the debenture); $0.144 for 34,722 shares ($5,000
          of the
          debenture); $0.128 for 544,195 shares ($69,657 of the debenture). All of
          the
          prices were determined by the conversion formula in the debenture (80%
          of the
          average bid prices for the three lowest (out of 15) trading days before
          conversion). These shares were sold pursuant to the exemption provided
          by
          section 4(2) of the 1933 Act.
 
 During
          2004, 215,336 restricted common shares were issued in payment of $40,932
          of
          services by Luis Vega, consulting geologist. The price per share was determined
          by dividing the amount owed by the average closing price of the company's
          stock
          for each day's service. These shares were sold pursuant to the exemption
          provided by section 4(2) of the 1933 Act.
 
 On
          February 4, 2004, 10,000 restricted common shares were issued to Yvonne
          St.
          Pierre, a Canadian resident, for computer-related services, in the amount
          of
          $2,500. These shares were issued pursuant to the exemption provided by
          Regulation S of the 1933 Act.
 
 Between
          February 10 and March 31, 2004, 75,000 restricted common shares were issued
          to
          Jeff Whitford, a Canadian resident, for investor relation services, in
          the
          amount of $15,000. In addition, Mr. Whitford received 50,000 warrants at
          an
          exercise price of $0.20 per share; the warrants will expire between February
          2006 and March 2006. The warrants were valued at $12,200 utilizing the
          Black
          Scholes model. These shares were issued pursuant to the exemption provided
          by
          Regulation S of the 1933 Act.
 
 On
          December 22, 2004, 2,500 restricted common shares were issued to Karen
          Barra, a
          U.S. resident, for services amounting to $500. The price per share was
          $0.20
          based on private placement offering for the period during which the services
          were rendered. These shares were sold pursuant to the exemption provided
          by
          Regulation S of the 1933 Act.
 
 During
          2004, 15,367 restricted common shares were issued in payment of accounts
          payable
          amounting to $3,842. The price per share was based on the average closing
          share
          price for the period during which the services were rendered. These shares
          were
          sold pursuant to the exemption provided by Regulation S of the 1933
          Act.
 
 During
          2004, 87,388 restricted common shares were issued to Terry Brown, a Mexican
          resident, for technical consulting services amounting to $15,247. The price
          per
          share was based on the average closing share price for the period during
          which
          the services were rendered. These shares were sold pursuant to the exemption
          provided by Regulation S of the 1933 Act.
 
 On
          March
          1, 2004, in connection with the conversion of $82,687 in notes payable
          and
          $225,595 in accrued officers' salary payable, we issued 1,233,127 restricted
          common shares at $0.25 per share and 1,233,127 warrants, with an exercise
          price
          of $0.30 and expiring on March 1, 2006, to two officers, two directors,
          and a
          former director and his insurance agency. These persons and the insurance
          agency
          are accredited investors.
  2005
 
 During
          the twelve months ended December 31, 2005, we sold 712,500 restricted common
          shares to 21 Canadian residents for a total of $142,500, and issued warrants
          to
          purchase 712,500 restricted common shares, exercisable at $0.25 per share.
          These
          securities were issued in private transactions in reliance on the exemption
          from
          registration with the SEC provided by Regulation S.
 
 15
  A
          prior
          U.S. shareholder exercised other warrants, at exercise prices ranging from
          $0.22, for proceeds of $11,000, which resulted in the issuance of 50,000
          restricted common shares. These securities were issued in private transactions
          in reliance on the exemption available under Section 4(2) of the 1933
          Act.
 
 We
          also
          issued, for services, 349,545 restricted common shares for a total value
          of
          $69,800 valued at fair market value at date of issuance and granted 13,575
          warrants (exercisable for two years at $0.25 per share) valued at fair
          market
          value at date of issuance. These securities were issued to two Canadian
          residents, and one Mexican Corporation in reliance on the exemption from
          registration available under Regulation S, and one U.S. resident, in reliance
          on
          the exemption provided by Section 4(2) of the 1933 Act.
  2006
 
 During
          the twelve months ended December 31, 2006, we sold 2,622,213 restricted
          common
          shares to 76 Canadian residents, 8 US residents, 5 Israeli Nationals and
          1 Swiss
          National for a total of $688,000, and issued warrants to purchase 2,348,213
          restricted common shares, exercisable between $0.25 to $.45 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, 8,500 restricted common shares for a total value
          of $2,325
          and these securities were issued to one U.S. resident in reliance on the
          exemption provided by Section 4(2) of the 1933 Act.
 
 On
          July
          3, 2006, the Company issued 2,200 shares of its par value common stock
          for
          services received by an individual. As of September 30, 2006, the Company
          recorded consulting expense in the amount of $462, the fair value of the
          shares
          issued on the date of grant. Additionally, the Company granted a warrant
          to
          purchase 2,200 shares of the Company's common stock at an exercise price
          of
          $0.25 for a period of 2 years. The Company recorded an expense in the amount
          of
          $373, the fair value of the warrant 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: 187%; risk free interest
          rate: 5.12%.
 
 On
          July
          3, 2006, the Company issued 8,800 shares of its par value common stock
          for
          services received from an individual. As of September 30, 2006, the Company
          recorded consulting expense in the amount of $2,200, the fair value of
          the
          shares issued on the date of grant. Additionally, the Company granted a
          warrant
          to purchase up to 8,800 shares of the Company's common stock at an exercise
          price of $0.25 for a period of 2 years. The Company recorded an expense
          in the
          amount of $1,812, the fair value of the warrant 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: 187%; risk
          free
          interest rate: 5.12%.
 
 On
          July
          3, 2006, an officer of the Company elected to convert half of his accrued
          salary
          in exchange for 385,714 shares of common stock valued at $81,000, the fair
          value
          of the shares issued on the date of grant. Additionally, the Company granted
          a
          warrant to purchase up to 385,714 shares of the Company's common stock
          at an
          exercise price of $0.25 for a period of two years. The Company recorded
          an
          expense in the amount of $65,418, the fair value of the warrant 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:
          187%;
          risk free interest rate: 5.12%.
 
 On
          July
          3, 2006, the Company issued 56,821 shares of its common stock for conversion
          of
          a note in the amount of $11,932 from a shareholder of the Company. Additionally,
          the Company granted a warrant to purchase up to 56,821 shares of the Company's
          common stock at an exercise price of $0.25 for a period of two years. The
          Company recorded an expense in the amount of $9,637, the fair value of
          the
          warrant 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: 187%; risk free interest rate: 5.12%.
 
 On
          July
          11, 2006, the Company issued 206,767 shares of its par value common stock
          pursuant to the convertible debenture agreement entered into on January
          24, 2006
          whereby the Company received a $40,000 convertible at a rate of $0.20 per
          share
          bearing interest of 10% per annum. The note holder elected to convert all
          accrued interest totaling $1,895 into 6,767 shares of the Company's par
          value
          common stock.
 
 16
  On
          August
          22, 2006, the Company entered into an agreement to purchase mining claims
          located in Mohave County, Arizona in exchange for 1,000,000 shares of the
          Company's par value common stock. The Company recorded an asset totaling
          $18,500, the actual cost to maintain the claims per year.
  2007
 
 During
          the twelve months ended December 31, 2007, we sold 1,238,167 restricted
          common
          shares to 72 Canadian residents and 4 US residents for a total of $375,534
          and
          issued warrants to purchase 492,795 restricted common shares, exercisable
          between $0.35 to $.65 per share. These securities were issued in private
          transactions, with respect to the Canadian residents, in reliance on the
          exemption from registration with the SEC provided by Regulation S, and
          with
          respect to the U.S. citizen, in reliance on the exemption available under
          Section 4(2) of the 1933 Act.
 
 On
          April
          30, 2007, the Company also issued 50,000 shares of restricted common stock
          as
          part of a settlement agreement with a former officer of the Company for
          compensation of accrued salaries. The common stock was rendered to a U.S.
          citizen, in reliance on the exemption available under Section 4(2) of the
          1933
          Act. The shares were valued at a total of $22,000. In addition to monthly
          cash
          payments of $3,500 per month the Company has recorded debt forgiveness
          of
          $147,419 in accordance with the terms of the settlement agreement. Due
          to the
          related party nature of the transaction the gain has been recorded to additional
          paid in capital, therefore there has been no impact on the Company’s net
          loss.
 
 On
          June
          29, 2007, the Company also issued 4,000 shares of restricted common stock
          for
          services rendered to a U.S. citizen, in reliance on the exemption available
          under Section 4(2) of the 1933 Act. The shares were valued at a total of
          $2,000.
  2008
 During
        the three months ending March 31, 2008, the Company sold 32,500 restricted
        shares of common stock along with warrants to purchase an additional 32,500
        shares of the Company’s common stock to various accredited Canadian and US
        citizens for total proceeds of $8,125. The warrants were fully vested, are
        exercisable at $0.35 per share, and expire two years from the date of issuance.
        These securities were issued in private transactions, with respect to the
        Canadian resident, 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.
 
 Previously
        issued warrants to purchase 431,000 shares of the Company’s common stock expired
        during the six months ending, June 30, 2008.
 
 7.
              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.
  8.
              SUBSEQUENT
                  EVENTS
 
 During
        July of 2008 the Company received a total of $175,000 from three of the
        Company’s shareholders. The unsecured promissory notes bear interest at 8% and
        matures at various dates in June and July of 2009 .
  17




**ITEM
      2.**  **MANAGEMENT'S
      DISCUSSION AND ANALYSIS**




**(a)**  **Plan
      of Operation.**




Can-Cal
      Resources Ltd. is a public company engaged in seeking the acquisition and
      exploration of metals mineral properties. As part of its growth strategy, the
      Company will focus its future activities in the USA, with an emphasis on the
      Pisgah Mountain, California property and the Wikieup, Arizona property.




The
      Company has discontinued all industrial sales for the volcanic materials located
      on the Pisgah property in California subject to the finalization of the current
      analytical program.





At
      May
      19, 2008, we had approximately $30,209 cash available to sustain operations.
      Accordingly we are uncertain as to whether the Company may continue as a going
      concern. While we may seek additional investment capital, or possible funding
      or
      joint venture arrangements with other mining companies, we have no assurance
      that that such investment capital or additional funding and joint venture
      arrangements will be available to the Company.




**(b)**  **Results
      of Operations for the Three Months Ended June 30, 2008 and
      2007.**





The
      following table summarizes selected items from the statement of operations
      for
      the three months ended June 30, 2008 compared to June 30, 2007.




**EXPENSES:**




Three
                Months Ended
              June
                30,2008
            
            2007
            
            Increase
                / (Decrease)Amount
            
            Amount
            
            $
            
            %Expenses:Exploration costs
            
            $
            20,991
            
            $
            55,635
            
            $
            (34,644
            )
            
            (62
            %)Depreciation
            
            
            2,998
            
            
            3,816
            
            
            (818
            )
            
            (21
            %)General
                & administrative expenses
            
            
            85,645
            
            
            58,251
            
            
            27,394
            
            
            47
            %Officer
                compensation
            
            
            29,008
            
            
            32,886
            
            
            (3,878
            )
            
            (12
            %)Total operating expenses
            
            
            138,642
            
            
            150,588
            
            
            (11,946
            )
            
            (8
            %)Loss
                from operations
            
            
            (138,642
            )
            
            (150,588
            )
            
            (11,946
            )
            
            (8
            %)Other
                income (expense):Interest
                income
            
            
            4
            
            
            3,505
            
            
            (3,501
            )
            
            (100
            %)Rental
                revenue
            
            
            16,689
            
            
            5,625
            
            
            11,064
            
            
            197
            %Loss
                on sale of equipment
            
            
            -
            
            
            3,701
            
            
            (3,701
            )
            
            (100
            %)Interest
                expense
            
            
            (15,460
            )
            
            (14,307
            )
            
            (1,153
            )
            
            (8
            %)Total other income (expense)
            
            
            1,233
            
            
            (1,476
            )
            
            2,709
            
            
            184
            %Net
                loss
            
            $
            (137,409
            )
            $
            (152,064
            )
            $
            (14,655
            )
            
            (10
            %)







18




**Exploration
      costs**





Exploration
      costs for the three months ended June 30, 2008 decreased by $34,644 or 62%
      from
      $55,635 for the three months ended June 30, 2007 to $20,991 for the three months
      ended June 30, 2008. The decrease is due to our efforts to scale back on further
      research as a result of the Cease Trade Order issued by the British Columbia
      Securities Commission and therefore causing the inability to provide Private
      Placement funding necessary to maintain operations.


Unless
      the Company is able to establish the economic viability of its mining
      properties, the Company will continue writing off its expenses of exploration
      and testing of its properties. Therefore, losses will continue unless the
      Company sells one or more of its properties or locates and delineates reserves
      and initiates mining operations. If that occurs, the Company may capitalize
      certain of those expenses.





The
      Company has no material commitments for capital expenditures other than
      expenditures it chooses to make with respect to testing and or exploration
      of
      its mineral properties.





**Depreciation**





Depreciation
      for the three months ended June 30, 2008 decreased by $818 or 21% from $3,816
      for the three months ended June 30, 2008 to $2,998 for the three months ended
      June 30, 2008. The decrease is principally due to less equipment on hand to
      depreciate after the sale of equipment towards the end of the three month period
      ending June 30, 2007.





**General
      and administrative expenses**





General
      and administrative expenses for the three months ended June 30, 2008 increased
      by $27,394 or 47% from $58,251 for the three months ended June 30, 2007 to
      $85,645 for the three months ended June 30, 2008. The increase is principally
      due to increased costs to maintain the office, including increased utility
      costs
      and payroll and payroll taxes associated with moving some of the administrative
      functions in house.




19





**Officer
      compensation**





Officer
      compensation for the three months ended June 30, 2008 decreased by $3,878 or
      12%
      from $32,886 for the three months ended June 30, 2007 to $29,008 for the three
      months ended June 30, 2008.





**Total
      operating expenses**





Total
      operating expenses for the three months ended June 30, 2008 decreased by $11,946
      or 8% from $150,588 for the three months ended June 30, 2007 to $138,642 for
      the
      three months ended June 30, 2008. The decrease in total operating expenses
      was
      mainly a result of management’s efforts to scale back exploration costs until
      the Company has the resources to effectively explore the claims that have been
      obtained.





**Other
      income (expense)**





Interest
      income for the three months ended June 30, 2008 decreased by $3,501 or 100%
      from
      $3,505 for the three months ended June 30, 2007 to $4 for the three months
      ended
      June 30, 2008. Interest income relates to interest earned on cash received
      as a
      result of financing activities, of which less was on hand during the three
      months ended June 30, 2008 compared to the same period in 2007.





Rental
      revenue for the three months ended June 30, 2008 increased by $11,064 or 197%
      from $5,625 for the three months ended June 30, 2007 to $16,689 for the three
      months ended June 30, 2008. Rental revenue relates to income derived from the
      rental of the Company’s land for the purposes of filming movies or photo shoots.
      More photo shoots, including a television commercial, were performed during
      the
      three months ended June 30, 2008 compared to the same period in 2007.





Interest
      expense for the three months ended June 30, 2008 increased by $1,153 or 8%
      from
      $14,307 for the three months ended June 30, 2007 compared to $15,460 for the
      three months ended June 30, 2008.





**Net
      loss**





Our
      net
      loss was $137,409 for the three months ended June 30, 2008 compared to a net
      loss of $152,064 for the three months ended June 30, 2007. We expect to improve
      our results of operations through the attainment of sufficient working capital
      and a focus on generating revenues from the subcontracting of mining activities,
      and a reduction of general and administrative expenses.





(c)  Results
      of Operations for the Six Months Ended June 30, 2008 and 2007.





The
      following table summarizes selected items from the statement of operations
      for
      the six months ended June 30, 2008 compared to June 30, 2007.





20




**EXPENSES:**
  Six
                  Months Ended
                June
                  30,2008
              
              2007
              
              Increase
                  / (Decrease)Amount
              
              Amount
              
              $
              
              %Expenses:Exploration costs
              
              $
              38,905
              
              $
              102,943
              
              $
              (64,038
              )
              
              (62
              %)Depreciation
              
              
              5,995
              
              
              6,021
              
              
              (26
              )
              
              -
              %General
                  & administrative expenses
              
              
              142,640
              
              
              106,745
              
              
              35,895
              
              
              34
              %Officer
                  compensation
              
              
              60,000
              
              
              64,052
              
              
              (4,052
              )
              
              (6
              %)Total operating expenses
              
              
              247,540
              
              
              279,761
              
              
              (32,221
              )
              
              (12
              %)Loss
                  from operations
              
              
              (247,540
              )
              
              (279,761
              )
              
              (32,221
              )
              
              (12
              %)Other
                  income (expense):Interest
                  income
              
              
              102
              
              
              6,959
              
              
              (6,857
              )
              
              (99
              %)Rental
                  revenue
              
              
              26,614
              
              
              11,250
              
              
              15,364
              
              
              137
              %Loss
                  on sale of equipment
              
              
              -
              
              
              3,701
              
              
              (3,701
              )
              
              (100
              %)Interest
                  expense
              
              
              (29,264
              )
              
              (28,887
              )
              
              377
              
              
              1
              %Total other income (expense)
              
              
              (2,548
              )
              
              (6,977
              )
              
              (4,429
              )
              
              (63
              %)Net
                  loss
              
              $
              (250,088
              )
              $
              (286,738
              )
              $
              (36,650
              )
              
              (13
              %)
 
 **Exploration
        costs**
  Exploration
        costs for the six months ended June 30, 2008 decreased by $64,038 or 62%
        from
        $102,943 for the six months ended June 30, 2007 to $38,905 for the six months
        ended June 30, 2008. The decrease is due to our efforts to scale back on
        further
        research as a result of the Cease Trade Order issued by the British Columbia
        Securities Commission and therefore causing the inability to provide Private
        Placement funding necessary to maintain operations.
 
 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.
  21
 
 The
        Company has no material commitments for capital expenditures other than
        expenditures it chooses to make with respect to testing and or exploration
        of
        its mineral properties.
  **Depreciation**
  Depreciation
        for the six months ended June 30, 2008 decreased by $26 or -% from $6,021
        for
        the six months ended June 30, 2008 to $5,995 for the six months ended June
        30,
        2008. The decrease is principally due to less equipment on hand to depreciate
        after the sale of equipment towards the end of the three month period ending
        June 30, 2007.
  **General
        and administrative expenses**
  General
        and administrative expenses for the six months ended June 30, 2008 increased
        by
        $35,895 or 34% from $106,745 for the six months ended June 30, 2007 to $142,640
        for the six months ended June 30, 2008. The increase is principally due to
        increased costs to maintain the office, including increased utility costs,
        payroll, and payroll taxes associated with moving some of the administrative
        functions in house.
  **Officer
        compensation**
  Officer
        compensation for the six months ended June 30, 2008 decreased by $4,052 or
        6%
        from $64,052 for the six months ended June 30, 2007 to $60,000 for the six
        months ended June 30, 2008.
  **Total
        operating expenses**
 
 Total
        operating expenses for the six months ended June 30, 2008 decreased by $32,221
        or 12% from $279,761 for the six months ended June 30, 2007 to $247,540 for
        the
        six months ended June 30, 2008. The decrease in total operating expenses
        was
        mainly a result of management’s efforts to scale back exploration costs until
        the Company has the resources to effectively explore the claims that have
        been
        obtained.
  **Other
        income (expense)**
 
 Interest
        income for the six months ended June 30, 2008 decreased by $6,857 or 99%
        from
        $6,959 for the six months ended June 30, 2007 to $102 for the six months
        ended
        June 30, 2008. Interest income relates to interest earned on cash received
        as a
        result of financing activities, of which less was on hand during the six
        months
        ended June 30, 2008 compared to the same period in 2007.
 
 Rental
        revenue for the six months ended June 30, 2008 increased by $15,364 or 137%
        from
        $11,250 for the six months ended June 30, 2007 to $26,614 for the six months
        ended June 30, 2008. Rental revenue relates to income derived from the rental
        of
        the Company’s land for the purposes of filming movies or photo shoots. More
        photo shoots, as well as, television commercials were performed during the
        six
        months ended June 30, 2008 compared to the same period in 2007.
 
 Interest
        expense for the six months ended June 30, 2008 increased by $377 or 1% from
        $28,887 for the six months ended June 30, 2007 compared to $29,264 for the
        six
        months ended June 30, 2008.
  **Net
        loss**
 
 Our
        net
        loss was $250,088 for the six months ended June 30, 2008 compared to a net
        loss
        of $286,738 for the six months ended June 30, 2007. We expect to improve
        our
        results of operations through the attainment of sufficient working capital
        and a
        focus on generating revenues from the subcontracting of mining activities,
        and a
        reduction of general and administrative expenses.
 
 22
  **(d)**  **Liquidity
        and Capital Resources and Results of Operations**
  The
        following table summarizes total current assets, total current liabilities
        and
        working capital at June 30, 2008 compared to December 31, 2007.
 June
                    30,
                  2008
                
                December
                    31,
                  2007
                
                **Increase
                    / (Decrease)****$**
                ****
                **%**Current
                    Assets
                
                $
                77,927
                
                $
                105,987
                
                $
                (28,060
                )
                
                (26
                %)Current
                    Liabilities
                
                $
                1,050,057
                
                $
                842,149
                
                $
                207,908
                
                
                25
                %Working
                    Capital (deficit)
                
                $
                (972,130
                )
                $
                (831,552
                )
                $
                140,608
                
                
                17
                %
  ***Internal
        and External Sources of Liquidity***
  During
        the six months ended June 30, 2008 and 2007, our operating and investing
        activities used cash of $159,865 and $284,222, respectively, while our financing
        activities provided cash of $126,705 and $269,029, respectively. The cash
        used
        in operating activities was principally a result of the net loss we
        incurred.
 
 ***Cash
        Flow.***
 
 ** Since
        inception, we have primarily financed our cash flow requirements through
        the
        issuance of common stock and the issuance of notes. With the growth of our
        current business we may, during our normal course of business, experience
        net
        negative cash flows from operations until some of our mining activities begin
        to
        produce revenues. Further, we may be required to obtain financing to fund
        operations through additional common stock offerings and bank or other debt
        borrowings, to the extent available, or to obtain additional financing to
        the
        extent necessary to augment our available working capital.
 
 ***Satisfaction
        of our cash obligations for the next twelve months.***
  Our
        plan
        for satisfying our cash requirements for the next twelve months is through
        additional equity, third party financing, and/or debt financing. We anticipate
        our current cash reserves will be sufficient to support operations through
        December 31, 2008, but do not anticipate generating sufficient amounts of
        positive cash flow to meet our working capital requirements. Consequently,
        we
        intend to make appropriate plans to ensure sources of additional capital
        in the
        future to fund growth and expansion through additional equity or debt financing
        or credit facilities. We also are considering possible funding through joint
        venture arrangements with other mining companies. There can be no assurance
        that
        we will raise capital through any of these means.
  23
 
 As
        we
        expand operational activities, we may continue to experience net negative
        cash
        flows from operations, pending receipt of sales and will be required to obtain
        additional financing to fund operations through common stock offerings and
        debt
        borrowings to the extent necessary to provide working capital.
 
 We
        anticipate incurring operating losses until we build our capital base. Our
        recent operating history makes predictions of future operating results difficult
        to ascertain. In addition, since our cash position has fallen we are finding
        it
        increasingly difficult to expand our operations. Thus, our prospects must
        be
        considered in light of the risks, expenses and difficulties frequently
        encountered by companies in their early stages of commercial viability,
        particularly companies in rapidly evolving energy markets. Such risks include,
        but are not limited to, an evolving and unpredictable business model and
        the
        management of growth. To address these risks we must, among other things,
        implement and successfully execute our business and marketing strategy, continue
        to develop and upgrade technology and products, respond to competitive
        developments, and continue to attract, retain and motivate qualified personnel.
        There can be no assurance that we will be successful in addressing such risks,
        and the failure to do so can have a material adverse effect on our business
        prospects, financial condition and results of operations.
 
 ITEM
        3.
        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
 
 Not
        applicable.
 
 ITEM
        4T.
        CONTROLS AND PROCEDURES
 
 The
        Company maintains disclosure controls and procedures that are designed to
        ensure
        that information required to be disclosed in the Company’s Exchange Act reports
        is recorded, processed, summarized and reported within the time periods
        specified in the SEC’s rules and forms, and that such information is accumulated
        and communicated to the Company’s management, including its Chief Executive
        Officer and Chief Financial Officer, as appropriate, to allow timely decisions
        in accordance with the required "disclosure controls and procedures" as defined
        in Rule 13a-15(e). The Company’s disclosure and control procedures are designed
        to provide reasonable assurance of achieving their objectives, and the principal
        executive officer and principal financial officer of the Company concluded
        that
        the Company’s disclosure controls and procedures were effective at the
        reasonable assurance level.
 
 At
        the
        end of the period covered by this Quarterly Report, the Company carried out
        an
        evaluation, under the supervision and with the participation of the Company's
        management, including the Company's principal executive officer and principal
        financial officer, of the effectiveness of the design and operation of the
        Company's disclosure controls and procedures. Based of the foregoing, the
        principal executive officer and principal financial officer of the Company
        concluded that the Company’s disclosure controls and procedures were effective
        to ensure that the information required to be disclosed in the Company’s
        Exchange Act reports is recorded, processed, summarized and reported within
        the
        time periods specified in the SEC’s rules and forms, and that such information
        is accumulated and communicated to the Company’s management including the
        Company’s principal executive officer and principal financial officer to allow
        timely decisions regarding required disclosure.
 
 Changes
        in Internal Control over Financial Reporting
  There
        were no changes in our internal control over financial reporting, as defined
        in
        Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently
        completed fiscal quarter that have materially affected, or are reasonably
        likely
        to materially affect, our internal control over financial
 reporting.
 
 24
  PART
        II -
        OTHER INFORMATION
 
 ITEM
        1.
        LEGAL PROCEEDINGS
 
 The
        Company is not currently a party to litigation. The British Columbia Securities
        Commission (BCSC) has recently required, and in July 2008 the Company obtained,
        technical reports prepared by a Qualified Person under National Instrument
        43-01
“Standards of Disclosure for Mineral Projects” (“NI 43-101”). As a result of the
        tests, the Company withdraws its previously announced results in a press
        release
        dated August 28, 2006 and in its Company Newsletter of November 21, 2006
        for its
        Wikieup and Pisgah projects, retracting its previous disclosure of mineral
        reserves, mineral resources, other estimates of tons and grade, and any other
        economic analyses of each of its mineral properties, including Wikieup and
        Pisgah.
 
 Additionally,
        the BCSC has also requested documentation regarding all subscribers to the
        Company stock who are resident in British Columbia. The Company is cooperating
        with the requested production.
 
 The
        BCSC,
        at the time of the BCSC order requiring the Company’s production of the NI
        43-101 report, suspended trading of the Company’s stock in British Columbia
        until satisfactory completion of the 43-101 reports. The Company believes
        that
        has met its obligations under the BCSC order, and anticipates that the BCSC
        will
        lift the suspension of the trading of its stock
 
 ITEM
        2.
        CHANGES IN SECURITIES.
 
 The
        Company neither sold nor issued securities during the quarter ended June
        30,
        2008.
 
 Previously
        issued warrants to purchase 23,500 shares of the Company's common stock expired
        during the three months ending March 31, 2008.
 
 ITEM
        3.
        DEFAULTS UPON SENIOR SECURITIES
 
 The
        Company is in default on a note payable for $300,000 and its semi- annual
        interest payments of $280,000 for the years ended 2002 - 2007, and the three
        months ended March 31, 2008. The Company is currently negotiating forbearance
        on
        collection of the principal and interest.
 
 The
        Company is also in default on two notes payable to a stockholder, which matured
        in January 2008 and February 2008, respectively. The principal amount of
        each
        note is $25,114 and $35,436, with accrued interest of $1,362 and $1,922
        respectively. Each note bears interest at 8.0% per annum and is secured by
        real
        property. The Company is currently negotiating forbearance on collection
        of the
        principal and interest of each note.
 
 ITEM
        4.
        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
 None.
 
 ITEM
        5.
        OTHER INFORMATION
 
 N/A
  25
 
 ITEM
        6.
        EXHIBITS AND REPORTS ON FORM 8-K
 
 31.1
        Certification under Rule 13a-14(a)
 
 32.1
        Certification under Rule 13a-14(b)
 
 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 19, 2008
              By:
              /s/
                Ronald D. SloanRONALD
                  D. SLOAN,
                  Chief
                    Executive Officer and
                    President
  26