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

                                   FORM 10-QSB

  X    Quarterly Report pursuant to Section 13 or 15(d) of the
-----  Securities Exchange Act of 1934
       For the fiscal quarter ended September 30, 2004

       Transition Report under Section 13 or 15(d) of the
-----  Securities Exchange Act of 1934.
       For the transition period from _____ to _____.

       Commission File No. 0-26669

                             Can-Cal Resources Ltd.
--------------------------------------------------------------------------------
                 (Name of Small Business Issuer in its charter)

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

                    2500 Vista Mar Drive, Las Vegas, NV 89128
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (702) 243-1849
--------------------------------------------------------------------------------
                           (Issuer's telephone number)

                                       N/A
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

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


                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

              Class                           Outstanding on November 12, 2004
-----------------------------------         ------------------------------------
   Common Stock, Par Value $.001.                      17,470,299

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

<PAGE>



                           FORWARD LOOKING STATEMENTS


     Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 provide a "safe harbor" for forward looking statements that
are based on current expectations, estimates and projections, and management's
beliefs and assumptions. Words such as "believes," "expects," "intends,"
"plans," "estimates," "may," "attempt," "will," "goal," "promising," or
variations of such words and similar expressions are intended to identify such
forward-looking statements. These statements are not guarantees of future
performance and involve certain risks and uncertainties which are difficult or
impossible to predict. Therefore, actual outcomes and results may differ
materially from what is expressed or forecasted in such forward-looking
statements. The Company undertakes no obligation to update publicly any
forward-looking statement whether as a result of new information, future events
or otherwise.

     Such risks and uncertainties include, but are not limited to, the
availability of ore; negative or inconsistent test results, the existence of
precious metals in the ore available to the Company in an amount which permits
their production on an economic basis; the Company's ability to drill holes and
properly test and assay samples, and its ability to locate and acquire mineral
properties which contain sufficient grades of precious metals and/or minerals;
the Company's ability to sell a portion or all of any of its properties to
larger mining companies, or to enter into agreements with larger mining
companies to explore and possibly develop its properties; to produce precious
metals on a commercial basis, the prices of precious metals; obtaining a mill or
refinery to extract precious metals on an economic basis; the ability to
maintain the facilities it currently utilizes; obtain permitting requirements
for any mining and milling operations and pay the costs thereof; have good title
to claims and equipment; and the Company's ability to obtain financing necessary
to maintain its operations.



                                       2
<PAGE>



                                    CONTENTS



                                                                        PAGE NO.

PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

          Condensed Balance Sheet (unaudited)                                  4

          Condensed Statements of Operations (unaudited)                       5

          Condensed Statement of Stockholders' Deficit (unaudited)             6

          Condensed Statements of Cash Flows (unaudited)                       7

          Notes to Condensed Financial Statements (unaudited)               8-10

ITEM 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations                    11-13

ITEM 3.   Controls and Procedures                                             14

PART II.  OTHER INFORMATION

ITEM 2.   Changes in Securities                                               14

ITEM 3.   Defaults Upon Senior Securities                                     14

ITEM 6.   Exhibits and Reports on Form 8-K                                    15

          Signatures                                                          16

          Certifications                                                   17-20



                                       3
<PAGE>



PART I

ITEM 1 FINANCIAL STATEMENTS

                             CAN-CAL RESOURCES LTD.
                             CONDENSED BALANCE SHEET
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                   ASSETS

                                                                             September 30,
                                                                                 2004
                                                                             ------------
<S>                                                                          <C>
Current assets
     Cash                                                                    $    62,100
     Accounts receivable                                                           2,000
                                                                             -----------
        Total current assets
                                                                                  64,100

Fixed assets, net                                                                 20,100

Other assets, net                                                                  7,200
                                                                             -----------

Total assets                                                                 $    91,400
                                                                             ===========

                                   LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
     Accounts payable and accrued liabilities                                $   416,400
     Due to stockholder                                                           13,900
     Notes payable-related parties - current portion                             106,500
                                                                             -----------
        Total current liabilities
                                                                                 536,800

Long-term liabilities
     Notes payable-related parties - long-term portion                           300,000
                                                                             -----------

Total liabilities
                                                                                 836,800

Commitments and contingencies
                                                                             -----------

Stockholders' deficit
     Preferred stock; $0.001 par value; 10,000,000 shares
        authorized, no shares issued an outstanding
                                                                             -----------
     Common stock; $0.001 par value; 100,000,000 shares
        authorized, 17,159,718 shares issued and outstanding                      17,200
     Additional paid-in capital                                                5,447,000
     Accumulated deficit
                                                                              (6,209,600)
                                                                             -----------
        Total stockholders' deficit
                                                                                (745,400)
                                                                             -----------


Total liabilities and stockholders' deficit                                  $    91,400
                                                                             ===========
</TABLE>





                 See Accompanying Notes to Financial Statements.



                                       4
<PAGE>



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


<TABLE>
<CAPTION>
                                                 Three months ended                   Nine months ended
                                                    September 30,                        September 30
                                            ------------------------------      ------------------------------
                                                2004              2003             2004               2003
                                            ------------      ------------      ------------      ------------

<S>                                         <C>               <C>               <C>               <C>
Material sales                              $      6,600      $      3,700      $     21,700      $     14,500

Cost of sales                                      4,000             2,200            12,300             6,300
                                            ------------      ------------      ------------      ------------

     Gross profit                                  2,600             1,500             9,400             8,200

General and administrative expenses              160,000           147,000           507,700           405,500
                                            ------------      ------------      ------------      ------------

Loss from operations                            (157,400)         (145,500)         (498,300)         (397,300)

Other income (expense)
     Rental revenue                                5,600             9,600            26,900            20,900
     Interest expense                            (17,500)          (37,200)         (345,900)          (97,700)
                                            ------------      ------------      ------------      ------------

Loss before provision for income taxes          (169,300)         (173,100)         (817,300)         (474,100)

Provision for income taxes                          --                --                --                --
                                            ------------      ------------      ------------      ------------

Net loss                                    $   (169,300)     $   (173,100)     $   (817,300)     $   (474,100)
                                            ============      ============      ============      ============

Basic and diluted loss per common share     $      (0.01)     $      (0.01)     $      (0.05)     $      (0.04)
                                            ============      ============      ============      ============

Basic and diluted weighted average
     common shares outstanding                17,056,989        12,302,265        15,780,746        11,981,409
                                            ============      ============      ============      ============
</TABLE>












                 See Accompanying Notes to Financial Statements.



                                       5
<PAGE>



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


<TABLE>
<CAPTION>
                                                                                   Unamortized
                                                                                    Loan Fees
                                                                                    Related to
                                                Common Stock                        Convertible
                                             --------------------    Additional     Note Payable
                                             Number of                 Paid-in       Related-
                                               Shares      Amount      Capital         Party
                                             ----------   --------   -----------    ------------

<S>                                          <C>          <C>        <C>            <C>
Balance December 31, 2003                    13,252,962   $ 13,300   $ 4,366,300    $    (7,000)

Common shares issued for cash                 1,000,700      1,000       194,200           --

Exercise of warrants for cash                   701,275        700       124,900           --

Common shares issued for services               268,894        300        48,300           --

Common shares issued for receivable              50,001        --         10,000           --

Current period amortization of                     --          --           --            7,000
loan fees

Common shares issued in satisfaction
  of accounts payable and accrued
  liabilities                                   902,380        900       224,800           --

Common shares issued in
satisfaction of                                 330,747        300        82,400           --
   notes payable-related parties

Common shares issued in satisfaction of
   convertible debenture (including
   accrued interest of $14,700)                 702,760        700        99,000           --


Common shares received and cancelled
   related to receivable                        (50,001)       --        (10,000)          --

Interest expense for warrants                      --          --        277,300           --
granted

Warrants granted for services                      --          --         12,200           --

Deemed interest expense related to
   conversion feature of note
   payable-related party                           --          --         17,600           --

Net loss                                           --          --           --             --
                                             ----------   --------   -----------    -----------
Balance September 30, 2004                   17,159,718   $ 17,200   $ 5,447,000    $      --
                                             ==========   ========   ===========    ===========
</TABLE>


<TABLE>
<CAPTION>
                                               Receivable
                                               Related to
                                               Issuance of                        Total
                                                 Common        Accumulated    Stockholders'
                                                  Stock         Deficit          Deficit
                                               -----------    ------------    -------------

<S>                                            <C>            <C>             <C>
Balance December 31, 2003                      $      --      $ (5,392,300)   $ (1,019,700)

Common shares issued for cash                         --               --          195,200

Exercise of warrants for cash                         --               --          125,600

Common shares issued for services                     --               --           48,600

Common shares issued for receivable                (10,000)            --              --

Current period amortization of                        --               --            7,000
loan fees

Common shares issued in satisfaction
  of accounts payable and accrued
  liabilities                                         --               --          225,700

Common shares issued in
satisfaction of                                       --               --           82,700
   notes payable-related parties

Common shares issued in satisfaction of
   convertible debenture (including
   accrued interest of $14,700)                       --               --           99,700


Common shares received and cancelled
   related to receivable                            10,000             --              --

Interest expense for warrants                         --               --          277,300
granted

Warrants granted for services                         --               --           12,200

Deemed interest expense related to
   conversion feature of note
   payable-related party                              --               --           17,600

Net loss                                              --          (817,300)        (817,300)
                                               -----------    ------------      -----------
Balance September 30, 2004                     $      --      $ (6,209,600)   $    (745,400)
                                               ===========    ============    =============
</TABLE>









                 See Accompanying Notes to Financial Statements.



                                       6
<PAGE>



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

<TABLE>
<CAPTION>
                                                                          Nine months ended September 30
                                                                         -------------------------------
                                                                            2004                 2003
                                                                         ----------           ----------
<S>                                                                      <C>                  <C>
Cash flows from operating activities:
     Net loss                                                            $(817,300)           $(474,100)
     Adjustments to reconcile net loss to net
      cash used by operating activities:
        Stock based compensation                                            60,800               85,600
        Depreciation and amortization                                       16,800               28,900
        Stock issued for interest                                             --                  8,300
        Interest expense for warrants granted                              277,300                 --
        Deemed interest expense                                             17,600               28,700
     Changes in operating assets and liabilities:
        Change in accounts receivable                                          700               (1,500)
        Change in prepaid expenses                                          (4,800)              10,800
        Change in other assets                                                --                 (2,100)
        Change in accounts payable and accrued expenses                    227,900              192,200
                                                                         ---------            ---------
           Net cash used by operating activities                          (221,000)            (123,200)

Cash flows from investing activities:
     Purchase of fixed assets                                               (6,000)                (500)
                                                                         ---------            ---------
           Net cash used by investing activities                            (6,000)                (500)

Cash flows from financing activities:
     Change in due to stockholder                                           (2,400)              (1,400)
     Proceeds from issuance of common stock
                                                                           320,800               91,700
     Proceeds from borrowing on notes payable-related parties                7,200               41,900
     Principal payments on notes payable-related parties                   (53,900)             (11,800)
                                                                         ---------            ---------
           Net cash provided by financing activities                       271,700              120,400
                                                                         ---------            ---------

Net increase in cash                                                        44,700               (3,300)

Cash, beginning of period                                                   17,400               13,300
                                                                         ---------            ---------

Cash, end of period                                                      $  62,100            $  10,000
                                                                         =========            =========

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

Schedule of non-cash financing activities:
     Issuance of common stock for conversion of convertible note
        payable-related party, excluding interest of $8,300              $    --              $  10,000
                                                                         =========            =========

     Issuance of common stock for satisfaction of accounts payable
        and accrued liabilities                                          $ 225,700            $  11,100
                                                                         =========            =========

     Issuance of common stock for principal payment on
        notes payable-related parties                                    $  82,700            $    --
                                                                         =========            =========

     Issuance of common stock for receivable                             $  10,000            $    --
                                                                         =========            =========

     Issuance of common stock for conversion of convertible note
        payable-related party, including accrued interest of $14,700     $  99,700            $    --
                                                                         =========            =========
</TABLE>

                 See Accompanying Notes to Financial Statements.




                                       7
<PAGE>



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


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

     The accompanying unaudited financial statements have been prepared in
     accordance with Securities and Exchange Commission requirements for interim
     financial statements. Therefore, they do not include all of the information
     and footnotes required by accounting principles generally accepted in the
     United States for complete financial statements. The financial statements
     should be read in conjunction with the Form 10-KSB for the year ended
     December 31, 2003 of Can-Cal Resources Ltd ("the Company").

     The interim financial statements present the condensed balance sheet,
     statements of operations, stockholders' deficit and cash flows of Can-Cal
     Resources Ltd. The financial statements have been prepared in accordance
     with accounting principles generally accepted in the United States.

     The interim financial information is unaudited. In the opinion of
     management, all adjustments necessary to present fairly the financial
     position as of September 30, 2004 and the results of operations and cash
     flows presented herein have been included in the financial statements.
     Interim results are not necessarily indicative of results of operations for
     the full year.

     The preparation of financial statements in conformity with accounting
     principles generally accepted in the United States requires management to
     make estimates and assumptions that affect the reported amounts of assets
     and liabilities and disclosure of contingent assets and liabilities at the
     date of the financial statements and the reported amounts of revenues and
     expenses during the reporting period. Actual results could differ from
     those estimates.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
     ------------------------------------------

     Reclassification - Certain prior year balances have been reclassified to
     conform to the current year presentation, which have no effect on net
     income.

3.   ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
     -----------------------------------------

     Accounts payable and accrued liabilities consist of the following as of
     September 30, 2004:

         Accrued interest                                        $  151,500
         Accrued officers salary payables                           154,500
         Accounts payable                                            66,900
         Accrued officer bonus                                       18,000
         Other accrued liabilities                                   12,400
         Unearned revenues                                           13,100
                                                                 ----------

                                                                 $  416,400
                                                                 ==========

     During March 2004, the Company issued 902,380 shares of Common stock to
     officers in satisfaction of $225,600 in accrued officers salary payables.
     Additionally, the Company granted warrants to purchase 902,380 shares of
     common stock at $0.30 per shares. The warrants expire in March 2006 and
     totaled $202,900 using the Black Scholes model. The Company recorded the
     warrants as interest expense.




                                       8
<PAGE>



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


4.   NOTES PAYABLE-RELATED PARTIES
     -----------------------------

     Notes payable consisted of the following as of September 30, 2004:

<TABLE>
<S>                                                                             <C>
         Note payable to a stockholder, secured by real property, bearing
         interest at 16.0% per annum, interest only payments payable in
         semi-annual payments, maturing November 2005 (Note: The Company is in
         default of interest payments totaling $120,000 but is currently
         negotiating forbearance
         on collection of the interest)                                         $ 300,000

         Note payable to a stockholder, unsecured, bearing interest
         at 7.5% per annum, maturing June 2005                                     35,400

         Note payable to a stockholder, secured by real property,
         bearing interest at 8.0% per annum, maturing August 2005                  30,200

         Note payable to a stockholder, secured by real property,
         bearing interest at 8.0% per annum, maturing January 2005                 27,900

         Note payable to an stockholder, secured by real property,
         bearing interest at 8.0% per annum, maturing May 2005                      7,700

         Note payable to a stockholder, unsecured, bearing no interest
         and due on demand                                                          3,000

         Note payable to a stockholder, unsecured, bearing interest
         at 7.5% per annum, maturing February 2005                                  2,300
                                                                                ---------

                                                                                  406,500
         Less: amounts due within one year                                        106,500
                                                                                ---------

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

     During March 2004, the Company issued 330,747 shares of Common stock to
     various stockholders in satisfaction of $82,700 in principal on notes
     payable-related parties. Additionally, the Company granted warrants to
     purchase 330,747 shares of common stock at $0.30 per shares. The warrants
     expire in March 2006 and totaled $74,400 using the Black Scholes model. The
     Company recorded the warrants as interest expense.




                                       9
<PAGE>



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


5.   CONVERTIBLE NOTE PAYABLE-RELATED PARTY
     --------------------------------------

     During April, May, and June 2004, the convertible note payable-related
     party totaling $85,000 as of December 31, 2003 which consisted of an
     unsecured loan agreement with a stockholder was converted into 702,760
     shares of the Companies common stock, including accrued interest of
     $14,700. The Company recorded amortization expense totaling $3,100 and
     $3,400 for the nine months ended September 30, 2004 and 2003, respectively,
     related to loan fees, which were capitalized and amortized over the life of
     the loan.

     Due to the conversion feature of the debt and the Company's historical
     range of common stock prices, the Company recorded deemed interest totaling
     $17,600 for the nine months ended September 30, 2004.

     In relation to the loan, the Company granted warrants to purchase 50,000
     shares of the Company's common stock at the lower of 110% of the 5-day
     average closing bid prices a) preceding the date of issue, or b) 180 days
     after each closing. The warrants expire after three years. The fair value
     of the warrants as computed using the Black-Scholes option-pricing model
     was $16,700 and recorded as unamortized loan fees, of which $3,900 and
     $4,200 was expensed during the nine months ended September 30, 2004 and
     2003, respectively.

     Additionally, the Company issued 30,000 shares of common stock to a third
     party for fees related to the loan. The 30,000 shares were valued at
     $13,500 and recorded as unamortized loan fees, of which $3,100 and $3,400
     was expensed during the nine months ended September 30, 2004 and 2003 and
     2004, respectively.

6.   GOING CONCERN
     -------------
     The Company incurred a net loss of approximately $806,500 for the nine
     months ended September 30, 2004. The Company's current liabilities exceed
     its current assets by approximately $461,900 as of September 30, 2004.
     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.

7.   COMMITMENTS AND CONTINGENCIES
     -----------------------------

     Operating leases - The Company operates from leased facilities under
     noncancellable leases. The agreements call for an annual base rent of
     $11,900 and $17,900, respectively, for the term of one year. For the nine
     months ended September 30, 2004, total rent expense for the leased
     facilities approximated $18,000. Future minimum lease payments through
     September 30, 2005 totals $29,800.

8.   SUBSEQUENT EVENTS
     -----------------

     During October 2004, the Company issued 170,500 shares of common stock for
     cash totaling $34,100.



                                       10
<PAGE>



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

(A)  PLAN OF OPERATIONS.

     Can-Cal Resources Ltd. is a public company engaged in the acquisition and
exploration of precious metals mineral properties. As part of its growth
strategy, the Company will focus its future activities in the Western
Hemisphere, with an emphasis on Latin America, particularly Mexico. The extent
of these activities will be subject to available funding. Management intends to
maximize exploration expenditures by utilizing a focused approach to generative
exploration, while simultaneously seeking out potential near-term production
properties.

     The Company presently has gold exploration projects located in Mexico and
in California and Arizona. The US projects are inactive. Since June 2003,
Management has investigated several interesting mining properties in Mexico,
which met the objectives of the Company's growth strategy. In September 2003,
the Company incorporated a wholly owned Mexican subsidiary, Sierra Madre
Resources S. A. de C. V. ("SMR"), which is the Company's principal vehicle for
future acquisitions in Mexico.

     In February 2004, the SMR acquired a 100% interest in a gold-silver mineral
concession, referred to as the Arco Project (the "Project"). The Project
includes a land package of 463 hectares (approximately 1,140 acres), which is
owned by a private Mexican individual. In June 2004, SMR applied for a new
concession, Arco 2, which surrounds and is contiguous with the Arco concession
and also extends, in part, 7 kilometers to the north. The Arco 2 concession
includes a land package of 3,217 hectares (approximately 7,920 acres), bringing
the total land package for the Project area to 3,680 hectares (approximately
9,060 acres). The Project is located in Durango State, approximately 120
kilometers north-northwest of the city of Durango, and lies in the Central
Plateau Gold-Silver belt of the Sierra Madre Occidental, near the historic
Silver-Lead-Zinc district of Tejamen. SMR is also actively pursuing additional
property acquisitions, either by staking or options on third party concessions.
Discussions are presently taking place with several concession owners, and SMR
has identified a large number of areas of geological interest by way of
satellite imaging, which will be examined in the coming months. Any areas of
merit will be staked.

     During the third quarter of 2004, SMR completed two phases of rock chip
sampling of the outcrop veins located on the Arco Project. Encouraging assay
results were received from the first phase of sampling, and a new vein structure
was discovered approximately 600 meters to the southeast of the three main
outcrop veins, which are located in the northwest portion of the concession. Of
particular interest was the western-most vein (the "West Vein") of the main
outcrop veins, where successive gold assay values of 0.426 g/t, 0.329 g/t, 5.070
g/t, 1.265 g/t and 0.848 g/t were reported over a strike length of approximately
125 meters. The reported gold assays values for the new southeast vein, based on
3 rock chip samples, were 1.090 g/t, 1.945 g/t, and 1.460 g/t over a strike
length of approximately 130 meters.

     The principal focus of the second phase of sampling was to test for the
potential extension of the West Vein to the southeast and to further test the
newly discovered southeast vein area. An additional 8 rock chip samples were
taken along the southeast extension of the West Vein, over a strike length of
approximately 130 meters. The successive gold assay values for these samples
were again encouraging, as follows: 20.9 g/t, 0.32 g/t, 1.12g/t, 1.99 g/t, 0.31
g/t, 0.07 g/t 0.78 g/t and 0.10 g/t. The overall strike length of the West Vein
now approximates 320 meters. Additional sampling of the southeast vein area
resulted in the discovery of a second vein structure, which strikes north versus
northwest, as does the originally discovered southeast vein. A total of 5 rock
chip samples were taken along this newly discovered vein with reported,
successive gold assay values of 3.39 g/t, 0.05 g/t, 0.32 g/t, 0.50 g/t, and 0.37
g/t. This new vein structure requires further investigation, as does the
potential for the discovery of additional north-striking vein structures in the
eastern portion of the Arco concession.


                                       11
<PAGE>


     The 3 main outcrop veins converge to the southeast and dip below surface in
what appears to be a faulted area. Very narrow outcrop veining just to the
southeast of the faulted area was sampled, with reported gold assay values of
6.45 g/t and 4.39 g/t. The relationship between the convergence of the main
outcrop veins to the southeast and the southeast vein area, some 600 meters
away, requires further investigation. At present, it appears that the two vein
structures are along the same strike line.

     Lastly, a new potential stockwork target has been identified in the
northern most portion of the Arco concession, which warrants further
investigation.

     All samples were shipped to ALS Chemex of Vancouver, Canada for assaying.

     SMR's geological work to date indicates that the Arco Project is a
low-sulfidation epithermal gold-vein occurrence in Upper Series rhyolite
formation, which is projected to be relatively shallow, especially on the
northern and western margins of the main outcrop vein swarm where apparent
faults expose andesite flows supposed to be of the Lower Volcanic Sequence.
Typically, it is the underlying andesite formations that are mineralized in
Mexico. The fact that the veins occur in the rhyolite formation is unusual and
indicates the potential for wider and stronger vein structures in the underlying
Lower Series andesite formation. Although the main outcrop veins are narrow
(from 2 to 100 centimeters for individual veins in zones of up to 20 meters),
they have a strike length of over 2 kilometers and form vein swarms, suggesting
that the veins may thicken at depth in the underlying andesite series rocks.

     During 2004, the Company intends to continue to attempt to develop
industrial sales for the volcanic materials located on the Pisgah property, as a
follow up to the limited industrial sales attained in 2003 and 2002. No further
testing is planned at this time with respect to developing a leaching process to
extract precious metals contained in the cinder materials.

     The Company presently has two full-time employees and two part-time
geological consultants and will continue to rely on outside consultants and
agents, in the near-term, to perform various administrative, legal and technical
functions, as required.

(B)  LIQUIDITY AND CAPITAL RESOURCES AND RESULTS OF OPERATIONS

     As of September 30, 2004, the Company had a working capital deficit of
approximately $472,700 and approximately $62,100 cash was available to sustain
operations, which would cover the Company's planned activities through December
2004. The working capital deficit as of December 31, 2003 was $661,000 and
approximately $17,400 cash was available. We may seek additional capital by sale
of restricted stock in private placement transactions in Canada, loans from
directors, or possible funding or joint venture arrangements with other mining
companies. On January 29, 2004, the Company entered into an agreement (the
"Agreement") with IBK Capital Corp. ("IBK"), a private investment bank based in
Toronto, Canada, whereby IBK agreed to assist the Company in arranging financing
of up to $1,000,000 for the Company's Mexican exploration programs and for
working capital purposes, on terms to be negotiated. The Agreement was
originally effective through July 28, 2004 and has been extended for an
additional six-month period, ending on January 27, 2005. The Agreement may be
terminated or extended by either party upon 15 days advance notice in writing.
As of September 30, 2004, no financing had been finalized. Other than the IBK
agreement, there are no plans or arrangements now in place to fund the Company
by any of the means noted above, and the outcome of the discussions with other
companies cannot be predicted.


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     The Company had sales of $21,700 and gross profit of $9,400 from the sale
of cinder materials during the nine-month period ended September 30, 2004,
compared with sales of $14,500 and gross profit of $8,200 for the nine-month
period ended September 30, 2003. The Company sustained a net loss of $817,300
for the nine-month period ended September 30, 2004, compared to a net loss of
$474,100 for the nine-month period ended September 30, 2003. The increased net
loss in 2004 was principally due to a $248,200 increase in interest expense and
a $102,200 increase in general and administrative expenses. The higher interest
expense was entirely due to a $277,300 non-cash charge, using the Black Scholes
model, to record the value of 1,233,127 warrants granted to various shareholders
in March 2003 in connection with the conversion of $82,687 of related party
notes payable and $225,595 of accrued salary into 1,233,127 restricted common
shares of the Company at $0.25 per share and an equal amount of warrants
exercisable at $0.30 over a two-year term from March 1, 2004. These conversions
eliminated $308,282 in liabilities from the Company's balance sheet.

     The $102,200 increase in general and administrative expenses during the
nine-month period ended September 30, 2004 compared to the same period in 2003
was principally due to:

     o  Consulting increased by $57,800 based on expanded consulting geological
        and investor relation services and Mr. Ciali's employment agreement.

     o  Professional fees increased by $32,500 as a result of payments to IBK
        amounting to $21,405, representing a non-refundable fee and an expense
        advance in connection with the IBK Agreement, higher legal fees related
        to Mexico and to more SEC-related filings.

     o  Travel and Entertainment expenses increased by $8,100 due to higher
        international travel expenses and increased activities in Mexico.

     o  Lease expense increased by $4,500 due to an additional vehicle.

     o  Exploration-related expenditures increased by $4,400 based on increased
        activity in Mexico.

     o  Property taxes increased by $4,400 because of unrecorded prior year tax
        invoices, which had not been received due to a change of the Company's
        corporate address. As a result, property taxes on the Pisgah property
        were delinquent as of September 30, 2004.

     o  Depreciation and amortization decreased by $12,300 due to a $6,300
        decrease in depreciation, related to fully depreciated assets, and a
        $6,000 decrease in amortization, related to the exercise of the
        convertible note payable-related party in June 2004.

     o  Office rent decreased by $7,300 principally due to the relocation of the
        Company's Las Vegas office in October 2003 and the consolidation of
        rented space.

     Net cash used by operating activities amounted to $221,000 for the
nine-month period ended September 30, 2004, compared with $123,200 for the same
period in 2003, principally reflecting the increased level of general and
administrative expenses in 2004. The Company financed its activities principally
through the issuance of common stock, which amounted to $320,800 for the
nine-month period ended September 30, 2004 compared to $91,700 for the same
period in 2003.

     Unless the Company is able to establish the economic viability of its
mining properties, the Company will continue writing off its expenses of
exploration and testing of its properties. Therefore, losses will continue
unless the Company locates and delineates reserves 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.




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ITEM 3.  CONTROLS AND PROCEDURES

     In the 90 day period before the filing of this report, the certifying
officer of the Company has evaluated the effectiveness of the company's
disclosure controls and procedures. These disclosure controls and procedures are
those controls and other procedures we maintain, which are designed to insure
that all of the information required to be disclosed by the company in all its
periodic reports filed with the SEC is recorded, processed, summarized and
reported, within the time periods specified in the SEC's rules and forms.
Disclosure controls and procedures include, without limitation, controls and
procedures designed to ensure that information required to be disclosed by the
company in its reports filed or submitted under the Securities Exchange Act of
1934 is accumulated and communicated to company management, as appropriate to
allow management to make timely decisions regarding required disclosure.

     Subsequent to the date when the disclosure controls and procedures were
evaluated, there have not been any significant changes in the company's
disclosure controls or procedures or in other factors that could significantly
affect such controls or procedures. No significant deficiencies or material
weaknesses in the controls or procedures were detected, so no corrective actions
needed to be taken.


                                     PART II
                                OTHER INFORMATION

ITEM 2.  UNREGISTRED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

(c) During the three months ended September 30, 2004, we sold 275,000 restricted
common shares to 9 Canadian residents for a total of $50,100 and sold 10,000
restricted common shares to a resident of the United States for $2,000. We also
issued warrants to purchase 285,000 restricted common shares, exercisable at
$0.25 per share, and 245,000 warrants, exercisable at $0.50 per share, each for
a two year period. In addition, a prior shareholder exercised other warrants, at
an exercise price of $0.20 per share, for proceeds of $1,000, which resulted in
the issuance of 5,000 restricted common shares. The securities were issued in
private transactions in reliance on the exemption from registration with the SEC
provided by Regulation S, with respect to the Canadian residents, and in
reliance on the exemption provided by Section 4(2) of the 1933 Act, with respect
to the United States resident. The proceeds from these sales were used for
general working capital purposes.

     We also issued, for consulting geological services, 106,676 restricted
common shares for a total value of $14,158 to two US residents. These securities
were issued in reliance on the exemption provided by Section 4(2) of the 1933
Act.

     No commissions were paid in connection with these transactions.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

     The Company is in default on its semi-annual interest payment of $24,000
for 2002, 2003 and for the May 15, 2004 semi-annual payment (a total of
$120,000) on a note payable of $300,000 but is currently negotiating forbearance
on collection of the interest.




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ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits. Page No.

          31   Certifications Pursuant to Section 302
               of the Sarbanes-Oxley Act of 2002.........................  17-18

          32   Certifications pursuant to Section 1350 of
               Chapter 63 of Title 18 of the United States Code..........  19-20


     (b) Reports on Form 8-K. There we no reports filed on Form 8-K during the
         three month period ended September 30, 2004.



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                                   SIGNATURES

     In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                            CAN-CAL RESOURCES LTD.
                                            (REGISTRANT)



Date:  November 12, 2004                    By:    /s/  Anthony F. Ciali
                                                 -------------------------------
                                                 ANTHONY F. CIALI,
                                                 Chief Executive Officer
                                                 and President



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