AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION ON



7/13/04



SECURITIES AND EXCHANGE
COMMISSIONWASHINGTON, D.C.  20549



### FORM 10-QSB

(Mark One)

[  X ]          QUARTERLY REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934For the quarterly period ended:May
31, 2004



[   ]           TRANSITION REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934For the transition period
from_________________ to _________________________



Commission file number:333-91191



### INTERMOUNTAIN REFINING CO., INC.

(Name of small business issuer in its
charter)



|NEW MEXICO                                                     | 74-2329327                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or other jurisdiction of incorporation or
organization) | (I.R.S. Employer Identification
Number)



1921 Bloomfield
BoulevardFarmington, New Mexico 
87401Telephone: (505)
326-2668(Address, including zip code, and
telephone number, including area code, of issuer's principal executive
offices)

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
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes
_X_  No____

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

Check whether the issuer has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court. Yes_____ No
_____

(APPLICABLE ONLY TO CORPORATE
ISSUERS)



State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: 1,155,609 shares
of common stock, no par value, were outstanding on June 30,
2004.Transitional Small Business Disclosure
Format (Check One): Yes[ ] No [X]

10-QSB 1<Page>

### Table of Contents





|                                                                                     | Page
|------------------------------------------------------------------------------------ | ----
|Financial Statements of Intermountain                                                | 3   
|Managements Discussion and Analysis of Financial Condition
and Results of Operations | 3   
|Intermountain's Business Activities                                                  | 3   
|Liquidity and Capital Resources                                                      | 3   
|Cash Requirements as of May 31, 2004                                                 | 3   
|Results of Operations                                                                | 4   
|Changes in Accounting Principles                                                     | 8   
|Inflation, Deflation and Changing Prices                                             | 8   
|Controls and Procedures                                                              | 8   
|Legal Proceedings                                                                    | 8   
|Submission of Matters to a Vote of Security
Holders                                  | 8   
|Index To Financial Statements                                                        | 9   
|Exhibits and Reports on Form 8-K                                                     | 14  
|Certifications of Management                                                         | 15  

10-QSB 2<Page>

### Financial Statements of Intermountain

The financial statements of Intermountain as of May 31, 2004
and for the three month periods ended May 31, 2003 and May 31, 2004 are included
beginning on page 9 of this report.

### Management's Discussion and Analysis of Financial Condition and Results of
Operations

The following discussion of our financial condition as of May
31, 2004 and results of operations for the three month periods ended May 31,
2003 and May 31, 2004, should be read in conjunction with our financial
statements and notes related thereto included elsewhere in this
report.

Certain amounts (and corresponding discussions and
comparisons) related to results of operations for the three month period ended
May 31, 2003 and the statement of cash flows for the three month period ended
May 31, 2003 have been restated from amounts previously reported to reflect the
change in accounting for asset retirement obligations. The change in accounting
principle, which was effective as of March 1, 2003, was implemented during the
fourth quarter of the fiscal year ended February 29, 2004.

Some of the statements contained in this report relate to
future expectations, contain projections of results of operations or financial
condition or include other forward-looking information. When used in this
report, the words "estimate", "project", "anticipate", "intend", "believe",
"hope", "may" and similar expressions, as well as "will", "shall" and other
indications of future tense, are intended to identify forward-looking
statements. Those statements are subject to known and unknown risks,
uncertainties and other factors that could cause the actual results to differ
materially from those contemplated by the statements.  You are cautioned
not to place undue reliance on the forward-looking statements.

### Intermountain's Business Activities

Intermountain was incorporated under the laws of the state of
New Mexico in January 1984 and conducts its business in the following
areas:

- Production of oil and natural gas
- Leasing of asphalt paving products manufacturing and storage
facilities on a fee basis
- Other business activities including providing management and
consulting services to others, and leasing unused space in Intermountain's
office building.

### Liquidity and Capital Resources:

Cash flow and working capital positions continue to be
positive due to favorable natural gas prices. Management believes that cash flow
from ongoing operations will be adequate to meet cash demands for the coming
year.

The following table presents selected financial data regarding
cash and working capital:



|                          | February 28, 2004 | % Change | May 31,    2004
|------------------------- | ----------------- | -------- | ---------------
|Cash and cash equivalents | $     895,373     | 2%       | $     915,252  
|                          |                   |          |                
|Working capital           | $     926,435     | 7%       | $     987,634  

During the three months ended May 31, 2004, Intermountain
realized a $27,000 increase in cash from operating activities and a $7,000
decrease in cash from non-operating sources. There were no significant or
unusual operating cash items during the period. The $7,000 decrease in cash from
non-operating sources consisted mainly of the settlement of asset retirement
obligations.

During the three months ended May 31, 2003, Intermountain
realized an $84,000 increase in cash from operating activities and a $51,000
decrease in cash from non-operating sources. There were no significant or
unusual operating cash items during the period. The $51,000 decrease in cash
from non-operating sources consisted mainly of the purchase of the working
interest in the Nebraska oil producing properties for approximately
$50,000.

### Cash requirements as of May 31, 2004:

Estimated cash requirements for the next twelve months
include:

10-QSB 3<Page>

- $24,000 per month in normal general and administrative costs
including costs to operate our Farmington office building; and,
- $1,600 estimated monthly costs associated with the ownership
and maintenance of Intermountain's refinery and asphalt manufacturing and
storage facility.

In its efforts to develop
additional sources of revenues, Intermountain may incur some project development
costs. We are unable to predict the level of costs that may be incurred for such
additional projects during the next year.

Expected sources of cash during the next twelve months consist
of cash flows from operating activities estimated as follows:

- $30,000 per month net cash flow projected from oil and
natural gas operations based on results of operations during the three months
ended May 31, 2004 along with projections of production and prices during the
next 12 months;
- $1,900 per month from Farmington office space
rental;
- $3,000 per month from management fees charged to Red Hills
Manufacturing;
- $700 per month interest earned on cash balances;
- $3,200 per month from the rental of our asphalt storage and
manufacturing facility to Paramount, plus an estimated average of $8,300 per
month in throughput fees based on estimated annual asphalt product shipments of
10,000 tons during the 2004 paving season.

Estimates of future sources and uses of cash
presented herein are based on our assumptions and expectations that our
operations will continue at current levels without material interruption and
that collection of accounts will occur under agreed terms. Actual results may be
materially different.

The major components of the electric generation facility are
presently available for sale but there is no assurance that the equipment will
be sold within a reasonable period of time.

### Results of Operations:

The following table summarizes the results of Intermountain's
operations for each of the periods indicated. All percentage amounts were
calculated using the underlying data.





|                                                                           | Three months ended
|-------------------------------------------------------------------------- | ------------------
|                                                                           | May 31, 2003      
|Revenues                                                                   | $     203,469     
|Costs and expenses                                                         | 125,435           
|Net income  before taxes                                                   | 78,034            
|Income taxes                                                               | -                 
|Net income before cumulative effect of change in accounting
principle      | 78,034            
|Cumulative effect of change in accounting for asset
retirement obligations | (18,593)          
|Net income                                                                 | $    59,441       



#### Revenues:

The decrease in revenues for the three months ended May 31,
2004 compared to the three months ended May 31, 2003 consisted of:

- $20,000 decrease in oil and gas production
revenues
- $7,000 increase in asphalt equipment rental and
fees

The increase in revenues for the three
months ended May 31, 2003 compared to the three months ended May 31, 2002,
consisted of:

- $80,000 increase in oil and natural gas revenues;
- $2,000 increase in real estate
rental.

Changes in individual components of
revenues are discussed below:

10-QSB 4<Page>

##### Oil and Natural gas revenues:

The following table contains oil and gas production volume,
net to Intermountain's interest, and average selling prices received for the
periods indicated:



|                                | For the three months
ended
|------------------------------- | --------------------------
|                                | May 31, 2003              
|Natural gas produced, net (Mcf) | 46,506                    
|Average selling price ($/Mcf)   | $3.62                     
|Crude oil sold, net (Bbls)      | 127                       
|Average selling price ($/Bbl)   | $25.58                    



The decrease in oil and natural gas revenues for the three
months ended May 31, 2004 as compared to the three months ended may 31, 2003
consisted of a $25,000 decrease in natural gas revenues offset by a $5,000
increase in oil revenues.

The decrease in natural gas revenues for the three month
period ended May 31, 2004 compared to the three month period ended May 31, 2003
consisted of a $0.74 per Mcf (20%) decrease in selling prices offset by a 3,300
Mcf (7%) increase in natural gas produced. The decrease in natural gas prices
was generally attributed to the easing of concerns over projected supply and
demand imbalances. Due to the complexity of the economic factors affecting
energy prices, we are unable to predict the direction or magnitude of future
price changes. It is expected that Intermountain's production of natural gas
will decline slightly over the next twelve months consistent with observed
decline rates.

The increase in oil revenues for the three month period ended
May 31, 2004 compared to the three month period ended May 31, 2003 consisted of
a $7.12 per barrel (28%) increase in selling prices and a 136 barrels (107%)
increase in oil sold. The increase in oil prices was generally attributed to
concerns over world oil supply and demand imbalances. Due to the complexity of
the economic factors affecting energy prices, we are unable to predict the
direction or magnitude of future price changes. The increase in oil sold was due
to the sale of oil that had been produced in January and February of 2004 but
could not be shipped due to severe weather conditions. It is anticipated that
oil production for the remainder of the year will be consistent with oil
production experienced over the past twelve months.

The increase in oil and natural gas revenues for the three
months ended May 31, 2003 as compared to the three months ended May 31, 2002
consisted of a $77,000 increase in natural gas revenues and the addition of
$3,000 in oil revenues associated with the oil producing properties acquired on
March 1, 2003.

The increase in natural gas revenues for the three month
period ended May 31, 2003 compared to the three month period ended May 31, 2002
consisted of a $1.81 per Mcf (100%) increase in selling prices offset by a 3,900
Mcf (8%) decrease in natural gas produced. The increase in natural gas prices
was generally attributed to industry wide concerns over projected supply and
demand imbalances coupled with comparatively low natural gas storage levels
recorded at the end of the winter heating season and uncertainties concerning
the war with Iraq.

Oil production for the three month period ended May 31, 2003
amounted to 127 barrels, net to Intermountain’s interest, with an average
selling price of $25.58 per barrel. The production rate from the newly acquired
property was approximately 3 barrels per day, net to Intermountain’s
interest. Intermountain did not have any oil production during the three month
period ended May 31, 2002.

##### Real estate rental:

The increase in real estate rental during the three month
period ended May 31, 2004 compared to the three month period ended May 31, 2003
consisted of an average $92 per month increase in rental income from
Intermountain's Farmington, NM office building primarily due to a slight
increase in rental rates. Rental revenues are expected to remain unchanged over
the remainder of the year as building occupancy is near capacity.

The increase in real estate rental during the three month
period ended May 31, 2003 compared to the three month period ended May 31, 2002
consisted of an average $580 per month increase in building rental due to
increased occupancy.

10-QSB 5<Page>

##### Leasing of asphalt products manufacturing and storage
facilities:

The increase in asphalt equipment rental fees for the three
month period ended May 31, 2004 compared to the three month period ended May 31,
2003 was attributed to a slight increase in asphalt product shipments. Fees
recognized from asphalt equipment rental activities are expected to increase
during the summer months consistent with the seasonal nature of asphalt paving
and repair activities. It is estimated asphalt product shipments by Paramount
over the remainder of the current year will remain consistent with shipments
during the prior year.

Asphalt equipment rental fees remained essentially unchanged
during the three month period ended May 31, 2003 compared to the three month
period ended May 31, 2002.

##### Consulting fee revenues:



Consulting fee revenues were unchanged for the three month
period ended May 31, 2004 compared to the three month period ended May 31, 2003.
It is anticipated that consulting fee revenues will remain constant for the
remainder of the current year.

Consulting fee revenues were unchanged for the three month
period ended May 31, 2003 compared to the three month period ended May 31,
2002.

#### Costs and Expenses:

The following table presents a summary of Intermountain's
costs and expenses for the periods indicated:





|                                                      | Three Months Ended
|----------------------------------------------------- | ------------------
|                                                      | May 31, 2003      
|Cost of sales                                         | $    38,089       
|General and administrative costs                      | 74,238            
|Depletion, depreciation and amortization              | 15,274            
|Accretion of discount on asset retirement
obligations | 712               
|Interest and investment income, net                   | (2,878)           
|Total costs and expenses                              | $ 125,435         
|                                                      |                   

Costs and expenses increased overall by $12,000 during the
three month period ended May 31, 2004 compared to the three month period ended
May 31, 2003. The increase consisted of:

- $7,000 increase in cost of sales
- $6,000 increase in general and administrative
costs
- $2,000 decrease in depletion , depreciation and
amortization
- $1,000 decrease in interest and investment
income

Costs and expenses decreased overall by
$15,500 during the three month period ended May 31, 2003 compared to the three
month period ended May 31, 2002. The decrease consisted of:

- $10,000 decrease in cost of sales
- $5,000 decrease in general and administrative
expenses
- $700 increase in accretion of discount on asset retirement
obligations
- $500 increase in interest and investment
income.

Changes in individual components of
costs and expenses are discussed below.

##### Cost of sales:

Cost of sales includes costs incurred in the production of oil
and natural gas and certain costs of maintaining the asphalt and refinery
facility.

The increase in cost of sales for the three month period ended
May 31, 2004 as compared to the three month period ended May 31, 2003 consisted
of a $8,000 increase in oil and natural gas production costs offset by a $1,000
decrease in asphalt facility maintenance costs.

10-QSB 6<Page>

The increase in oil and natural gas production costs during
the three month period ended May 31, 2004 compared to the three month period
ended May 31, 2003 included a $5,000 increase in costs associated with the
Kansas natural gas properties and a $3,000 increase in production costs related
to the Nebraska oil properties.

The increase in Kansas production costs for the three month
period ended May 31, 2004 compared to the three month period ended May 31, 2003
was mainly attributed to a $4,500 increase in gas reserves accounting
costs.

The increase in Nebraska production costs for the three month
period ended may 31, 2004 compared to the three month period ended May 31, 2003
was mainly attributed to equipment repair costs.

Well pump, production tubing and surface equipment failures
occur randomly and the timing and cost of repairs cannot be accurately
predicted.

The decrease in cost of sales for the three month period ended
May 31, 2003 as compared to the three month period ended May 31, 2002 consisted
of an $11,000 decrease in oil and natural gas production costs offset by a
$1,000 increase in asphalt and refinery facility costs.

The decrease in oil and natural gas production costs for the
three month period ended May 31, 2003 compared to the three month period ended
May 31, 2002 consisted of a $13,000 decrease in natural gas production costs
offset by the addition of $2,000 of costs associated with the Nebraska oil
producing property acquired in March 2003. The decrease in natural gas
production costs was primarily attributed to a $12,000 reduction in gas well
repair costs due to a decrease in the number of well equipment failures
experienced during three month period ended May 31, 2003 as compared to the same
period during the prior year. There were no significant changes in other
individual natural gas production costs categories for the three month period
ended May 31, 2003 as compared to the same period during the prior year.

##### General and administrative expenses:

General and administrative expenses include the cost of
Intermountain's officers and administrative employees, costs incurred to operate
and maintain the Farmington office building, and all items of general overhead
required to manage and administer the corporate affairs of
Intermountain.

The increase in general and administrative expenses during the
three month ended May 31, 2004 compared to the three months ended May 31, 2003
was primarily due to a $7,000 increase in legal and accounting costs offset by a
slight reduction in all other cost categories. The increase in legal and
accounting costs was primarily the result of a timing difference between the two
periods on the receipt of invoices for year end accounting services.

The decrease in general and administrative expenses during the
three months ended May 31, 2003 compared to the three months ended May 31, 2002
was primarily due to a $2,000 decrease in legal and accounting costs, a $2,000
decrease in officer life insurance expense and a $1,000 decrease in building
maintenance costs.

##### Depreciation and Depletion:

The reduction in depreciation and depletion expense for the
three month period ended May 31, 2004 compared to the three month period ended
May 31, 2003 consisted of a $1,000 decrease in depreciation on leased asphalt
manufacturing and storage equipment and a $1,000 decrease in depletion expense.
The reduction in depletion expense was primarily due to a reduction in the cost
depletion rate applied to natural gas production resulting from the application
of the February 2004 adjustment to estimated gas reserves.

Depreciation and depletion expense was relatively unchanged
for the three month period ended May 31, 2003 compared to the three month period
ended May 31, 2002.

##### Interest and investment income (net):

Interest and investment income includes earnings on cash
balances and certificates of deposit and net earnings on investments, less
interest expense incurred.

The decrease in interest and investment income during the
three month period ended May 31, 2004 compared to the three month period ended
May 31, 2003 consisted of a $200 decrease in interest earned on cash balances
and a $1,200 decrease in income earned on investments. The decrease in income
earned on investments included a $900 loss on the sale of mutual fund
investments. Intermountain paid no interest expense during the three month
period ended May 31, 2004 or the three month period ended May 31, 2003. During
the three month period ended May 31, 2004, Intermountain disposed of all of its
mutual fund investments and reinvested the sale proceeds in other equities in an
effort to increase the overall yield on its investments.

The increase in interest and investment income during the
three month period ended May 31, 2003 compared to the three month period ended
May 31, 2002 consisted of a $400 increase in interest earned on cash balances
and a $100 increase in income on mutual fund investments. Intermountain paid no
interest expense during the three month period ended May 31, 2003 or the three
month period ended May 31, 2002.

10-QSB 7<Page>

### Changes in Accounting Principles:

Effective as of March 1, 2003, Intermountain implemented the
provisions of Financial Accounting Standards Board Statement No. 143 "Accounting
for Asset Retirement Obligations". The Statement addresses financial accounting
and reporting for obligations associated with the retirement of tangible
long-lived assets and the associated asset retirement costs. The Statement is
applicable to Intermountain's obligation to incur future costs to plug and
abandon its oil and gas wells.

The Statement requires that the amount of future plugging
costs to be estimated and recorded, at their present value as of the date of
acquisition, as a liability with a corresponding increase in the capitalized
cost of the oil and gas assets.  Subsequently, the additional capitalized costs
are amortized to expense using the units of production method, and the discount
on the present value of the liability is amortized to accretion expense based on
the increase in the present value over the passage of time. Actual costs
incurred for plugging and abandonment activities are charged against the
liability instead of being charged to results of operations as was the case
before implementation of the Statement.

Effective as of March 1, 2003, Intermountain recorded an
$18,593 charge to results of operations as recognition of the cumulative effect
of the change in accounting for plugging and abandonment costs associated with
its Kansas natural gas producing properties.

### Inflation, Deflation and Changing Prices:

The results of operations and capital expenditures will
continue to be affected by inflation, deflation and changing prices. 
Prices of natural gas could have a materially adverse effect on Intermountain's
operations.  Management is unable to determine the full impact of
inflation, deflation and changing prices on the results of operations or working
capital.

### Controls and Procedures

### Evaluation of Disclosure Controls and
Procedures:

Disclosure controls and procedures are designed and
implemented to ensure that all material information relating to a company is
made known to its chief operating officer, chief financial officer, and such
other persons who are responsible for preparing and filing periodic reports with
the Securities and Exchange Commission. On April 14, 2004, William N. Hagler and
Rick L. Hurt, representing all of the officers and directors of Intermountain,
updated their evaluation of Intermountain's disclosure controls and procedures
and concluded that such controls were adequate as of that date.

### Changes in Internal Controls:

There have been no significant changes in Intermountain's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of Management's last evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.

### Legal Proceedings

We are not aware of any pending or threatened legal
proceedings to which Intermountain is a party. We are not aware of any pending
or threatened legal proceedings to which any director, officer, affiliate of
Intermountain, or any owner of more than 5% of Intermountain's common stock, is
an adverse party to, or has a material interest adverse to,
Intermountain.

### Submission of Matters to a Vote of Security Holders



There have been no matters submitted to a vote of security
holders during the three months ended May 31, 2004 through the solicitation of
proxies or otherwise.

10-QSB 8<Page>

### Intermountain Refining Co., Inc.

### Index to Financial Statements



|                                                                                           | Page
|------------------------------------------------------------------------------------------ | ----
|                                                                                           |     
|Balance Sheet as of May 31,
2004                                                           | 10  
|                                                                                           |     
|Statements of Operations and
Comprehensive Income (Loss) for the three month periods ended |     
|May 31, 2003 and
May 31, 2004                                                              | 11  
|                                                                                           |     
|Statements of Cash Flows for the
three month periods ended                                 |     
|May 31, 2003 and
May 31, 2004                                                              | 12  
|                                                                                           |     
|Notes to financial
statements                                                              | 13  
|                                                                                           |     

10-QSB 9<Page>



|Intermountain Refining Co., Inc.                                           |  |            
|-------------------------------------------------------------------------- |  | -----------
|Balance Sheet – Unaudited                                                  |  |            
|May 31, 2004                                                               |  |            
|                                                                           |  |            
|Assets                                                                     |  |            
|Current Assets                                                             |  |            
|Cash and cash equivalents                                                  |  | $  915,252 
|Accounts receivable                                                        |  | 88,258     
|Inventories                                                                |  | 2,390      
|Prepaid expenses                                                           |  | 7,913      
|Total Current Assets                                                       |  | 1,013,813  
|Property, Plant and
Equipment, net of valuation allowances                 |  |            
|Land, buildings and
improvements                                           |  | 384,419    
|Equipment                                                                  |  | 164,930    
|Crude oil refining equipment                                               |  | 581,919    
|Oil and gas properties, (successful
efforts method)                        |  | 1,055,361  
|                                                                           |  | 2,186,629  
|Less accumulated depletion and
depreciation                                |  | (1,824,753)
|                                                                           |  | 361,876    
|Other Assets                                                               |  |            
|Electric generation equipment available for
sale                           |  | 270,000    
|Available-for-sale
investments                                             |  | 74,137     
|Other assets                                                               |  | 36,378     
|                                                                           |  | 380,515    
|Total Assets                                                               |  | $ 1,756,204
|Liabilities and Stockholders' Equity                                       |  |            
|Current Liabilities                                                        |  |            
|Accounts payable                                                           |  | $    23,216
|Taxes other than income
taxes                                              |  | 2,963      
|Income taxes payable                                                       |  | -          
|Total Current
Liabilities                                                  |  | 26,179     
|Deferred
Taxes                                                             |  | 3,271      
|Asset Retirement Obligations                                               |  | 30,569     
|Commitments and
Contingencies                                              |  | -          
|Stockholders' Equity                                                       |  |            
|Common stock, no par value, authorized
10,000,000 shares,                  |  |            
|issued and outstanding 1,155,609 shares                                    |  | 1,455,314  
|                                                                           |  |            
|Preferred stock, $0.01 par value, authorized 5,000,000
shares,             |  |            
|no shares issued and outstanding.                                          |  | -          
|                                                                           |  |            
|Retained earnings                                                          |  | 234,796    
|Accumulated other comprehensive income                                     |  | 6,075      
|                                                                           |  | 1,696,185  
|Total Liabilities and Stockholders'
Equity                                 |  | $ 1,756,204
|                                                                           |  |            
|The accompanying notes are an integral part of these
financial statements. |  |            

10-QSB 10<Page>



|Intermountain Refining Co., Inc.                                                                                                                                                       |                    |             
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------ | ------------
|Statements of Income and Comprehensive Income                                                                                                                                          |                    |             
|                                                                                                                                                                                       | Three months ended
|                                                                                                                                                                                       | May 31,            | May 31,     
|                                                                                                                                                                                       | 2003               | 2004        
|                                                                                                                                                                                       | (Unaudited)        | (Unaudited) 
|Revenues                                                                                                                                                                               |                    |             
|Oil and natural gas production
revenues                                                                                                                                                | $  171,492         | $  151,936  
|Asphalt equipment rental and throughput
fees                                                                                                                                           | 16,677             | 24,121      
|Real estate rental income                                                                                                                                                              | 6,300              | 6,575       
|Consulting fees                                                                                                                                                                        | 9,000              | 9,000       
|                                                                                                                                                                                       | 203,469            | 191,632     
|Costs and Expenses                                                                                                                                                                     |                    |             
|Cost of sales                                                                                                                                                                          | 38,089             | 45,360      
|General and administrative                                                                                                                                                             | 74,238             | 79,959      
|Depletion, depreciation and amortization
- Note B                                                                                                                                      | 15,274             | 12,926      
|Accretion of discount on asset retirement obligations -
Note B                                                                                                                         | 712                | 773         
|Interest and investment income,
net                                                                                                                                                    | (2,878)            | (1,407)     
|                                                                                                                                                                                       | 125,435            | 137,611     
|Income From Operations Before Income
Taxes                                                                                                                                             | 78,034             | 54,021      
|                                                                                                                                                                                       |                    |             
|Provision for income taxes                                                                                                                                                             |                    |             
|Current                                                                                                                                                                                | -                  | -           
|Deferred                                                                                                                                                                               | -                  | -           
|                                                                                                                                                                                       | -                  | -           
|                                                                                                                                                                                       |                    |             
|Income Before Cumulative Effect of Change in Accounting
Principle                                                                                                                      | 78,034             | 54,021      
|Cumulative effect on prior years of change in accounting for
asset retirement obligations - Note B                                                                                     | (18,593)           | -           
|Net Income                                                                                                                                                                             | 59,441             | 54,021      
|                                                                                                                                                                                       |                    |             
|Other Comprehensive Income (Loss), net of
tax:                                                                                                                                         |                    |             
|Unrealized holding gain on investments available for sale
(net of income tax expense of $944 for the three months ended May 31, 2003 and
$497 for the three months ended May 31, 2004) | 1,752              | 925         
|Reclassification adjustment for realized loss on sale of
investments available for sale net of deferred tax of $316                                                                    | -                  | 585         
|                                                                                                                                                                                       |                    |             
|Comprehensive Income                                                                                                                                                                   | $     61,193       | $     55,531
|                                                                                                                                                                                       | =========          | =========   
|Weighted Average Number of Shares
Outstanding                                                                                                                                          | 1,155,609          | 1,155,609   
|                                                                                                                                                                                       |                    |             
|Basic and Fully Diluted Earnings Per
Share                                                                                                                                             |                    |             
|Income before cumulative effect of change
in accounting principle                                                                                                                      | $      
0.07       | $      
0.05
|Cumulative effect of change in accounting for asset
retirement obligations                                                                                                             | (0.02)             | 0.00        
|                                                                                                                                                                                       | $      
0.05       | $      
0.05
|                                                                                                                                                                                       | ========           | ========    
|The accompanying notes are an integral part of these
financial statements.                                                                                                             |                    |             

10-QSB 11<Page>



|Intermountain Refining Co.,
Inc.Statements of Cash Flows                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Cash Flows From Operating Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Net income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Adjustments to reconcile net income
(loss) to net cash provided by operating activities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Cumulative effect of change in accounting for asset
retirement obligations - Note B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Depreciation, depletion and amortization
- Note B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Accretion of discount on asset retirement obligations -
Note B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Loss on disposal of available for sale
investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Changes in operating assets and
liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(Increase) decrease in
accounts receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Increase in prepaid expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Increase (decrease) in
accounts payable and accrued expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Decrease in income taxes
accrued/receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Net Cash Flow Provided by Operating
Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Cash Flows From Investing Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Settlement of asset retirement obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Purchases of available for sale
investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Proceeds from disposal of available for sale
investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(Increase) decrease in cash value of life
insurance policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Purchase of oil producing properties – Note
B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Net Cash Flow Provided (Used) by Investing
Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Increase (Decrease)  in Cash and Cash
Equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Cash and Cash Equivalents at Beginning of
Year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Cash and Cash Equivalents at End of
Period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Intermountain paid interest of $0 during the three month
period ended May 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Intermountain paid interest of $0 during the three month
period ended May 31, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Intermountain paid income taxes of  $149 during the three
month period ended May 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Intermountain paid income taxes of $0 during the three month
period ended May 31, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Supplemental Schedule of Noncash Investing
Activities:During the three month period ended May
31, 2003, Intermountain's available for sale investments increased in value by
$1,752, net of deferred tax expense of $944.During the three month period ended May 31, 2004,
Intermountain's available for sale investments increased in value by $1,510, net
of deferred tax expense of $813. The increase in value was comprised of net
holding gains of $925, net of deferred taxes of $497, and the reclassification
to realized loss of $585, net of deferred taxes of $316.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|During the three month period ended May 31, 2003, as a
result of a change in accounting for asset retirement obligations, Intermountain
recognized estimated asset retirement obligations of $33,538 and increased its
investment in oil and gas producing properties by the present value (as of the
date of acquisition) of estimate future obligations of $14,945, net of
accumulated depletion of $4,580.  - Note B                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|The accompanying notes are an integral part of these
financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

10-QSB 12<Page>

Intermountain Refining Co.,
Inc.Notes to Financial StatementsMay
31, 2004

### Note A - Interim Financial Statements (Unaudited)

The accompanying balance sheet as of May 31, 2004 and the
statements of operations for the three month periods ended May 31, 2003 and May
31, 2004, and the statements of cash flows for the three month periods ended May
31, 2003 and May 31, 2004 have been prepared by Intermountain, without audit. In
the opinion of management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and changes in cash at May 31, 2004, and for all periods presented,
have been made.

It is suggested that these unaudited financial statements be
read in conjunction with the audited financial statements for the year ended
February 28, 2004. The results of operations for the three months ended May 31,
2004 are not necessarily indicative of the operating results for the full
year.

### Note B - Restatement of Prior Year
Amounts

Certain amounts in the statement of operations for the three
month period ended May 31, 2003 and the statement of cash flows for the three
month period ended May 31, 2003 have been restated from the amounts as
previously reported in order to reflect the change in accounting for asset
retirement obligations. The change in accounting principle, which was effective
as of March 1, 2003, was implemented during the fourth quarter of the fiscal
year ended February 29, 2004.

10-QSB 13<Page>

### Exhibits and Reports on Form 8-K

### Reports on Form 8-K:

There were no reports on Form 8-K filed by Intermountain
during the quarter ended May 31, 2004.

### Exhibits:

All of the following exhibits are incorporated herein by
reference to Intermountain's registration statement filed on Form S-1 dated
April, 9, 2001:



|Exhibit | Description                                          
|------- | -----------------------------------------------------
|3.1     | Amended and Restated Articles of Incorporation       
|3.2     | Bylaws                                               
|10.1    | Oneok / Kinder Morgan / KN Energy Gas Sales
Agreement
|10.2    | Paramount Petroleum Agreement                        

### Signatures

Pursuant to the requirements of the Exchange Act, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Farmington, State of New
Mexico, on July 13, 2004.

Intermountain Refining Co., Inc.

By:/s/ William N.
HaglerWilliam N. Hagler, President

Pursuant to the requirements of the Exchange Act, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.

/s/ William N.
Hagler_________________   Date: July 13,
2004William N. Hagler, Chairman of the Board
ofDirectors, and
President/s/ Rick
L. Hurt ____________________   Date: July 13,
2004Rick L. Hurt, Secretary, Treasurer, Director

10-QSB 14<Page>

### Certifications



I, Rick L. Hurt, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of
Intermountain Refining Co., Inc.;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period
covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
5. designed such disclosure controls and procedures to ensure
that material information relating to the registrant is made known to us by
others, particularly during the period in which this quarterly report is being
prepared;
6. evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
7. presented is this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
8. The registrant's other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrant's
auditors:
9. all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
10. any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
controls; and
11. The registrant's other certifying officers and I have
indicated in this quarterly report whether or not there were significant changes
in internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies and
material weaknesses.



Date:____July 13, 2004_________________

/s/__Rick L. Hurt____________________

Rick L. Hurt, Secretary, Treasurer, Director

10-QSB 15<Page>

I, William N. Hagler, certify that:



1. I have reviewed this quarterly report on Form 10-QSB of
Intermountain Refining Co., Inc.;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period
covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
5. designed such disclosure controls and procedures to ensure
that material information relating to the registrant is made known to us by
others, particularly during the period in which this quarterly report is being
prepared;
6. evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
7. presented is this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
8. The registrant's other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrant's
auditors:
9. all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
10. any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
controls; and
11. The registrant's other certifying officers and I have
indicated in this quarterly report whether or not there were significant changes
in internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies and
material weaknesses.



Date:____July 13, 2004_______________

/s/__William N. Hagler_______________

William N. Hagler, President, Director

10-QSB 16<Page>

### EXHIBIT 99.1



### Certification of Chief Executive Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002





I, William N. Hagler, President and Chief Executive Officer of
Intermountain Refining Co., Inc. certify that:



1. I have reviewed the quarterly report on Form 10-QSB of
Intermountain Refining Co., Inc;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report.





July 13, 2004
/s/ William N. Hagler

-----------------------
--------------------------------------------

Date
William N. Hagler

President and Chief Executive Officer

10-QSB 17<Page>

### EXHIBIT 99.2





### Certification of Chief Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002





I, Rick L. Hurt, Treasurer and Chief Financial Officer of
Intermountain Refining Co., Inc. certify that



1. I have reviewed the quarterly report on Form 10-QSB of
Intermountain Refining Co., Inc;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report.





July 13, 2004
/s/ Rick L. Hurt

-----------------------
--------------------------------------------

Date
Rick L. Hurt

Treasurer and Chief Financial Officer

10-QSB 18<Page>