UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)
              [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended            June 30, 1998
                              ------------------------------------------------

                                       OR

             [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

              For the transition period from __________ to ________


                         Commission file number 0-19365

                            CROWN ENERGY CORPORATION
             (Exact name of registrant as specified in its charter)

          Utah                                          87-0368981     
 (State or other jurisdiction             (I.R.S. Employer Identification No.)
of incorporation or organization)

                215 South State, Suite 550, Salt Lake City, Utah, 84111
--------------------------------------------------------------------------------
               (Address of principal executive offices, zip code)

                                 (801) 537-5610
              (Registrant's telephone number, including area code)

                                 Not applicable
              (Former name, former address and former fiscal year,
                         if changed since last report)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  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


         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

There were  12,668,512  shares of $.02 par value common stock  outstanding as of
August 14, 1998.


<PAGE>

                            CROWN ENERGY CORPORATION

                                      INDEX
                                                                         PAGE(S)


PART I.           Financial Information


  ITEM 1.  Financial Statements

           Condensed Consolidated Balance Sheets at June 30,
              1998 (unaudited) and December 31, 1997                         3

           Condensed Consolidated Statement of Operations for the Three
              Months ended June 30, 1998 and 1997 (unaudited)                5

           Condensed Consolidated Statement of Operations for the Six
              Months ended June 30, 1998 and 1997 (unaudited)                6

           Condensed Consolidated Statement of Cash Flows for the
              Six Months ended June 30, 1998 and 1997 (unaudited)            7

           Notes to Condensed Consolidated Financial Statements
              (unaudited)                                                    9


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


PART II.          Other Information

  ITEM 1.  Legal Proceedings                                                15

  ITEM 2.  Changes in Securities                                            15

  ITEM 3.  Defaults upon Senior Securities                                  15

  ITEM 4.  Submission of Matters to a Vote of Security Holders              15

  ITEM 5.  Other Information                                                15

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


PART III.                  Signatures                                       16


<PAGE>
<TABLE>
<CAPTION>


                                            PART I-FINANCIAL INFORMATION
                                            ITEM 1.  FINANCIAL STATEMENTS

                                              CROWN ENERGY CORPORATION

                                        CONDENSED CONSOLIDATED BALANCE SHEETS

                                                       ASSETS


                                                                                    June 30,
                                                                                    1998                 December 31,
                                                                                 [unaudited]                   1997

CURRENT ASSETS:
<S>                                                                                  <C>                <C>       
     Cash                                                                            $861,376           $3,100,765
     Trade and other accounts receivable, net of allowance for
          doubtful accounts of $75,000 and $75,000 at 1998 and 1997                   192,954               10,808
     Inventory                                                                        294,764                    0
     Other current assets                                                             776,454              177,416
                                                                                 ------------         ------------
          Total Current Assets                                                      2,125,548            3,288,989
PROPERTY AND EQUIPMENT, net                                                           183,371                7,383

EQUITY INVESTMENT IN A LIMITED LIABILITY
     COMPANY                                                                        4,397,438            3,412,355

OTHER ASSETS                                                                          235,035              354,930
                                                                                  -----------         ------------

          TOTAL ASSETS                                                             $6,941,392           $7,063,657
                                                                                   ==========           ==========
</TABLE>


        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                       3
<PAGE>
<TABLE>
<CAPTION>


                                              CROWN ENERGY CORPORATION

                                        CONDENSED CONSOLIDATED BALANCE SHEETS

                                        LIABILITIES AND STOCKHOLDERS' EQUITY



                                                                                    June 30,
                                                                                    1998                        December 31,
                                                                                  [unaudited]                   1997

CURRENT LIABILITIES
<S>                                                                                    <C>                             <C>   
     Accounts payable                                                                  $42,305                         $9,535
     Dividends payable                                                                 270,986                              0
     Other current liabilities                                                          53,259                        124,981

  Total Current Liabilities                                                            366,550                        134,516
                                                                                ----------------                     ----------



STOCKHOLDERS' EQUITY:
      Preferred stock, $.005 par value, 1,000,000 shares
         authorized, 500,000 $10 Series A Cumulative Convertible
         Shares issued and outstanding                                                   2,500                           2,500
     Common stock, $.02 par value, 50,000,000 shares
         authorized, 12,668,512 and 11,722,216 issued and
         outstanding at 1998 and 1997, respectively                                    253,370                         234,444
     Capital in excess of par value                                                 10,695,485                      10,165,245
     Common stock subscription receivable  from related parties                       (572,058)                              0
     Retained deficit                                                               (3,804,455)                     (3,473,048)
                                                                                ----------------                --------------

          Total Stockholders' Equity                                                 6,574,842                       6,929,141
                                                                                ---------------                 --------------

          TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                $6,941,392                      $7,063,657
                                                                                ==============                  ==============
</TABLE>

                                       4
<PAGE>
<TABLE>
<CAPTION>



                                              CROWN ENERGY CORPORATION

                                                     [Unaudited]

                                   CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


                                                                                          For the Three Months Ended
                                                                                                      June 30,

                                                                                             1998                        1997
REVENUE:
<S>                                                                                      <C>                                   <C>
         Asphalt revenue                                                                 $186,929                              $0
         Oil and gas production                                                                 0                          26,993
                                                                                    -------------                 ---------------

                           Total Revenue                                                  186,929                          26,993
                                                                                   --------------                 ---------------

EXPENSES:
         Production costs and related taxes                                                     0                         26,496
         Cost of goods sold                                                               123,140                              0
         Operating expenses                                                                   816                              0
         General and administrative expenses                                              111,465                         81,119
         Depletion, depreciation and amortization                                           7,951                          8,905
                                                                                    ----------------              --------------

                           Total Expenses                                                 243,372                        116,520
                                                                                    --------------                --------------

OPERATING LOSS                                                                            (56,443)                       (89,527)
                                                                                     ---------------              --------------

OTHER INCOME (EXPENSES):
         Interest and other income                                                         30,851                            588
         Interest and other expense                                                          (350)                      (745,300)
                                                                                    ----------------              ---------------

                           Total Other Income (Expenses)                                   30,501                       (744,712)
                                                                                    ---------------               --------------

LOSS BEFORE TAX PROVISION                                                               ($25,942)                      ($834,239)
                                                                                    ---------------               --------------

PROVISION FOR TAXES:
         Deferred tax expense (benefit)                                                        0                     (345,663)
                                                                                    ---------------              ----------------

NET LOSS                                                                                ($25,942)                   ($488,576)
                                                                                    ===============              ===============

BASIC AND DILUTED NET LOSS PER SHARE                                                         ($0.00)                      ($0.04)
                                                                                     ===============             ===============
</TABLE>

                                       5
<PAGE>
<TABLE>
<CAPTION>


                                             CROWN ENERGY CORPORATION

                                                     [Unaudited]

                                   CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


                                                                                        For the Six Months Ended
                                                                                                 June 30,

                                                                                          1998                1997
REVENUE:
<S>                                                                                      <C>                     <C>
         Asphalt revenue                                                                 $186,929                $0
         Oil and gas production                                                                 0            77,496
                                                                                    -------------       ------------

                           Total Revenue                                                  186,929            77,496
                                                                                    --------------   --------------

EXPENSES:
         Production costs and related taxes                                                     0            54,653
         Cost of goods sold                                                               123,140                 0
         Operating expenses                                                                   816                 0
         General and administrative expenses                                              250,361           163,998
         Depletion, depreciation and amortization                                           9,651            23,817
                                                                                    -------------       ------------

                           Total Expenses                                                 383,968           242,468
                                                                                    --------------    -------------

OPERATING LOSS                                                                           (197,039)         (164,972)
                                                                                   --------------     -------------

OTHER INCOME (EXPENSES):
         Interest and other income                                                         78,078             1,486
         Interest and other expense                                                        (6,873)         (754,045)
                                                                                    ----------------- -------------

                           Total Other Income (Expenses)                                   71,205         (752,559)
                                                                                    -----------------  ------------

LOSS BEFORE TAX PROVISION                                                               ($125,834)        ($917,531)
                                                                                    --------------     ------------

PROVISION FOR TAXES:
         Deferred tax expense (benefit)                                                         0         (373,833)
                                                                                    --------------      -------------

NET LOSS                                                                                ($125,834)       ($543,698)
                                                                                     ==============      ===========

BASIC AND DILUTED NET LOSS PER SHARE                                                       ($0.01)          ($0.05)
                                                                                    =============        ==========
</TABLE>


<PAGE>
<TABLE>
<CAPTION>

                                             CROWN ENERGY CORPORATION

                                                    [Unaudited]

                                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                      For the Six Months Ended
                                                                                                 June 30,                  
                                                                                           1998             1997      
 
Cash Flows From (To) Operating Activities:
<S>                                                                                    <C>                <C>       
       Net income (loss)                                                               ($125,834)         ($543,698)
                                                                                       ---------          --------- 

       Adjustments to reconcile net loss to
           net cash used by operating activities:
                Amortization, depreciation and depletion                                    9,651            23,817
                Non-cash (income) expense                                                (22,892)                 0
                Net effect of sale of subsidiary                                                0           903,430
                Change in assets and liabilities:
                    Accounts receivable                                                 (182,146)            30,379
                    Inventory                                                           (294,764)                 0
                    Other assets                                                        (479,143)           (98,800)
                    Accounts payable                                                      32,770            (51,345)
                    Other current liabilities                                             (6,308)           (83,769)
                    Deferred tax liability                                                     0           (373,833)
                                                                                       ---------          --------- 
                           Total adjustments                                            (942,832)          (349,879)
                                                                                        ---------          --------- 
                           Net Cash Used by Operating Activities                      (1,068,666)          (193,819)
                                                                                       ---------          --------- 
Cash Flows From (To) Investing Activities:
       Additions to oil sand properties                                                        0            (39,632)
       Equity investment in limited liability company                                   (985,083)                 0
       Purchase of property & equipment                                                 (185,639)                 0
                                                                                       ---------          --------- 
                           Net Cash Used by
                                Investing Activities                                  (1,170,722)           (39,632)
                                                                                       ---------          --------- 
Cash Flows From (To) Financing Activities:
       Net changes in long-term debt                                                           0            (32,547)
       Net proceeds from issuance of convertible debenture                                     0            150,000
                                                                                       ---------          --------- 

                           Net Cash Used  by Financing Activities                             $0          ($117,453)
                                                                                        ---------          --------- 
 
</TABLE>
                                       7
<PAGE>
<TABLE>
<CAPTION>




                                             CROWN ENERGY CORPORATION

                                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                    [Continued]


                                                                                      For the Six Months Ended
                                                                                               June 30,                   
                                                                                          1998                1997     
 
<S>                                                                                  <C>                  <C>        
         Net Decrease in Cash:                                                       ($2,239,389)         ($115,998) 
                                                                                     ===========          =========  

Cash at Beginning of Period                                                           $3,100,765           $142,772
                                                                                     ===========          =========  
Cash at End of Period                                                                   $861,376            $26,774
                                                                                     ===========          =========  

Supplemental Disclosure of Cash Flow Information
       Cash paid during the period:
           Interest                                                                       $6,873             $4,844
                                                                                     ===========          =========  
           Income taxes                                                                    ---                 ---
                                                                                     ===========          =========   


Supplemental Schedule of Non-cash Investing and Financing Activities:

       For the period ended June 30, 1998:

                The  Company  issued  946,296  shares of common  stock for notes
receivable.

       For the period ended June 30, 1997:

                The Company  issued  45,000 shares of common stock in payment of
accounts payable and oil sand costs.

                The Company issued 25,894 shares of common stock in payment of a
note payable.

                The Company  converted  accrued  interest of $13,142  into notes
payable.


</TABLE>


                                       8
<PAGE>


                            CROWN ENERGY CORPORATION

                    NOTES TO UNAUDITED CONDENSED CONSOLIDATED

                              FINANCIAL STATEMENTS


         NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

                  The accompanying  consolidated  financial statements have been
                  prepared  by the  Company  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
                  stockholders'  equity and cash flows at June 30,  1998 and for
                  all periods presented have been made.

                  Certain information and footnote disclosures normally included
                  in financial  statements prepared in accordance with generally
                  accepted accounting principles have been condensed or omitted.
                  It is suggested that these condensed  financial  statements be
                  read in  conjunction  with the financial  statements and notes
                  thereto  included in the  Company's  December 31, 1997 audited
                  consolidated  financial statements.  The results of operations
                  for the  period  ended  June  30,  1998  are  not  necessarily
                  indicative of the operating results for the full year.

                  ORGANIZATION

                  Crown Energy Corporation  ["Crown"],  a Utah corporation,  was
                  organized on March 17, 1981.  Crown's primary  activities have
                  been the acquisition and development of oil and gas leases.

                  BuenaVentura    Resources   Corporation   ["BVRC"],   a   Utah
                  corporation,  was organized  October 24, 1985.  Crown acquired
                  100% of BVRC on  September  30, 1992.  On August 6, 1997,  the
                  name of BVRC was changed to Crown Asphalt Corporation ["CAC"].
                  On September  1, 1997,  the  corporation  entered into a joint
                  venture  with  MCNIC  Pipeline  and   Processing   Company  to
                  construct  and  operate  an  asphalt  production  facility  at
                  Asphalt Ridge (See Note 3 - Formation of Joint  Venture).  The
                  Company's asphalt business is its primary business activity.

                  Gavilan Petroleum, Inc. ["Gavilan"],  a Utah corporation,  was
                  organized  on  September  9,  1985.  Gavilan is engaged in the
                  production  and selling of oil and gas from leases it operates
                  in the  state of Utah.  Gavilan  became a 100%  subsidiary  of
                  Crown on January  24,  1991.  Gavilan was sold on July 2, 1997
                  for $150,000. (See Note 2 - Sale of Subsidiary)

                  Crown Asphalt Products Company ("Crown Products") was formerly
                  known as Energy Technologies  Corporation.  Crown Products was
                  formed in 1991, but until recently has been a dormant  entity.
                  The Company recently  activated Crown Products for the purpose
                  of developing an asphalt marketing and distribution business.

                  PRINCIPLES OF CONSOLIDATION

                  The consolidated  financial statements include the accounts of
                  the Company and its wholly-owned subsidiaries. All significant
                  inter-company    transactions    have   been   eliminated   in
                  consolidation.

                                       9
<PAGE>

                            CROWN ENERGY CORPORATION

                    NOTES TO UNAUDITED CONDENSED CONSOLIDATED

                              FINANCIAL STATEMENTS


         NOTE 2 - SALE OF SUBSIDIARY

                  On July 2, 1997,  the Company  entered  into a stock  purchase
                  agreement  with Road Runner Oil,  Inc.("RRO")  to sell 100% of
                  its   interest  in  its   wholly-owned   subsidiary,   Gavilan
                  Petroleum,  Inc.("Gavilan").  Gavilan operated oil and natural
                  gas  properties.  Under  the terms of the  sale,  the  Company
                  transferred to RRO all of the issued and outstanding  stock of
                  Gavilan  and in  exchange  received  $25,000 at closing  and a
                  promissory  note under which it will be paid $50,000 within 30
                  days of closing;  $25,000 within 120 days of closing;  and the
                  remaining  $50,000 within 180 days of closing.  As of June 30,
                  1998,  the  promissory  note had a balance of $75,000 of which
                  the Company has established a reserve of $75,000.  This matter
                  is currently in dispute. "See Legal Proceedings."

         NOTE 3 - FORMATION OF JOINT VENTURE

                  On August 1,  1997,  Crown's  wholly-owned  subsidiary,  Crown
                  Asphalt  Corporation,  ("Crown  Asphalt") entered into a joint
                  venture with MCNIC Pipeline & Processing,  Inc., ("MCNIC"),  a
                  subsidiary  of  MCN  Energy  Group,  Inc.  ("MCN"),   a  large
                  diversified  energy  holding  company  with  approximately  $4
                  billion in assets.  The joint  venture  will  operate  through
                  Crown Asphalt Ridge, L.L.C., a Utah limited liability company,
                  (the "L.L.C.") and will be devoted to extracting  commercially
                  marketable  products from Crown  Asphalt's oil sands  reserves
                  (the "Reserves") located at Asphalt Ridge in eastern Utah.

                  MCNIC and Crown Asphalt will  initially hold sharing ratios of
                  75% and 25%, respectively,  in profits, losses and obligations
                  of the L.L.C.  The forgoing ratios will be adjusted to provide
                  each party with a 50% sharing  ratio upon the  achievement  of
                  certain  payouts to MCNIC.  Crown Asphalt's  required  capital
                  contribution  to the L.L.C.  consists  of (i) Crown  Asphalt's
                  rights under certain equipment leases with a fair market value
                  of up to $3.5  million to be obtained by Crown  Asphalt;  (ii)
                  the  Sublicense  of  Crown's  proprietary  oil sands  refining
                  technology  from  Park  Guymon  Enterprises,  Inc.;  (iii) the
                  capital  reserves  (which  were  valued  at  the  time  of the
                  formation  of the L.L.C.  at  $500,000)  and (iv) an amount of
                  cash,  if  any,  needed  to  bring  Crown  Asphalt's   capital
                  contributions  up to 25% of the capital  required to construct
                  the initial oil sands refining  plant.  After giving effect to
                  the value of the items described  above,  MCNIC, in turn, will
                  be required to fund 75% of the cash  required to construct the
                  initial   plant   contemplated   by  the  L.L.C.'s   Operating
                  Agreement.  It is presently  estimated that such initial plant
                  will cost $19 million to construct.


                                       10
<PAGE>


                            CROWN ENERGY CORPORATION

                    NOTES TO UNAUDITED CONDENSED CONSOLIDATED

                              FINANCIAL STATEMENTS


         NOTE 4 - SALE OF PREFERRED STOCK

                  On  November  4,  1997,  Crown  completed  the sale of 500,000
                  shares  of its 8%  Class A  Cumulative  Convertible  Preferred
                  Stock  ("Series A Preferred  Stock") to Enron  Capital & Trade
                  Resources Corp. ("ECT") pursuant to a Stock Purchase Agreement
                  dated  September  25, 1997 for an aggregate  sales price of $5
                  million.  Crown issued 45,000 shares and received  $450,000 on
                  the execution of the Stock  Purchase  Agreement.  The Series A
                  Preferred  are  convertible  at the option of its holders into
                  24% of the Common  Stock of Crown.  Dividends  shall accrue on
                  the  outstanding  Series A Preferred  shares at the rate of 8%
                  per annum  and may be paid  through  cash or common  shares of
                  Crown at the option of the holder.

                  Subject  to  the  holders'  right  to  convert  the  Series  A
                  Preferred, Crown may redeem the Series A Preferred at any time
                  from the date on which it is issued at the  following  prices:
                  (i)  if  such  redemption  occurs  prior  to  36  months,  the
                  redemption  price  shall be 130% of the  Series A  Preferred's
                  "Stated Value" ($10); (ii) if prior redemption occurs after 36
                  months but prior to 48 months,  the redemption  price shall be
                  115% of the Stated Value;  (iii) if redemption occurs after 48
                  months but prior to 60 months from the date of  issuance,  the
                  Series A  Preferred  may be  redeemed  at 110% of the Series A
                  Preferred's  Stated Value; and (iv) if redemption occurs after
                  60 months from the date of the issuance,  the redemption price
                  shall be 100% of the Series A Preferred's  Stated  Value.  The
                  holder of the Series A Preferred  may require  Crown to redeem
                  125,000  shares  of the  Series  A  Preferred  on  the  eighth
                  anniversary  of its  issuance and the like amount on the ninth
                  anniversary  of it  issuance,  with  all  remaining  Series  A
                  Preferred  to be  redeemed  on the  tenth  anniversary  of its
                  issuance at a per share price no lower than the Stated Value.

         NOTE 5 - CONCENTRATION OF CREDIT RISK

                  The  realization  of the  Company's  investment  in  oil  sand
                  properties  is dependent  on the success of the joint  venture
                  with  MCNIC  to  successfully  complete  construction  of  its
                  asphalt  production  facility and profitably  sell the related
                  asphalt products.  The Company currently has not generated any
                  significant revenues through the sale of asphalt products from
                  its mine at  Asphalt  Ridge in  eastern  Utah and the  Company
                  currently  does  not  have  any  other  method  of  generating
                  revenues.

         NOTE 6 - EXERCISE OF STOCK OPTIONS

                  On January 2, 1998, certain officers,  directors and employees
                  of the Company  exercised  946,296  options to purchase common
                  stock  for  $549,166  in  notes  receivable.  The  notes  bear
                  interest  at the  prime  rate,  adjusted  the  1st day of each
                  calendar  quarter,  and are  payable  on or before  January 2,
                  2003.

         NOTE 7 - ACCOUNTING STANDARDS

                  Reporting  Comprehensive  Income - In June 1997, the Financial
                  Accounting  Standards  Board  issued  Statement  of  Financial
                  Accounting Standards No. 130, "Reporting Comprehensive Income"
                  ("SFAS No.  130").  SFAS No.  130  establishes  standards  for
                  reporting  and  display  of   comprehensive   income  and  its
                  components  (revenues,  expenses,  gains and losses) in a full
                  set  of  general-purpose  financial  statements.  SFAS  No.130
                  requires  that an  enterprise  (a)  classify  items  of  other
                  comprehensive  income by their nature in a financial statement
                  and (b) display the accumulated balance of other comprehensive
                  income   separately  from  retained  earnings  and  additional
                  paid-in-capital  in  the  equity  section  of a  statement  of
                  financial position.

                                       11
<PAGE>


                            CROWN ENERGY CORPORATION

                    NOTES TO UNAUDITED CONDENSED CONSOLIDATED

                              FINANCIAL STATEMENTS



                  Effective  January 1, 1998, the Company adopted the provisions
                  of SFAS No. 130.  Accordingly,  the Company determined that no
                  transactions were considered to be an additional  component of
                  comprehensive income.  Therefore,  comprehensive income (loss)
                  equaled net income (loss) for the three and six-month  periods
                  ended June 30, 1998 and 1997.

         NOTE 8 - YEAR 2000

                  In 1998,  the Company  began the  conversion  of its principal
                  computer  software  systems  to a  new  integrated  system  to
                  support  future  growth and improve  productivity.  Management
                  believes that an additional  benefit of the conversion will be
                  compliant  with  Year  2000   requirements   without  material
                  additional  expenditures  or a material  adverse effect on the
                  Company's  financial   position,   results  of  operations  or
                  liquidity.   The  Company  also  has  third-party   customers,
                  financial  institutions,  vendors  and  others  with  which it
                  conducts  business.  While the  Company  believes  that  these
                  third-party  vendors and customers will  successfully  address
                  Year 2000 issues in a timely  manner,  it is  possible  that a
                  series of  failures  by third  parties  could  have a material
                  adverse  effect on the  Company's  results  of  operations  in
                  future years.

                                       12

<PAGE>


                  ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
                 OF FINANCIAL CONDITION AND RESULT OF OPERATIONS


RESULTS OF OPERATIONS

For the three month  period  ended June 30,  1998,  compared to the three months
ended June 30, 1997.

         Asphalt  revenue  increased from $0 for the three months ended June 30,
1997 to $186,929 for the three months ended June 30, 1998. This increase was due
to revenue from the Company's recently activated asphalt  distribution  company,
Crown Asphalt Products Company.

         Oil and gas revenue  decreased  from $26,993 for the three months ended
June 30, 1997 to $0 for the three months ended June 30, 1998.  This decrease was
due to the sale of the Company's  wholly-owned  subsidiary,  Gavilan  Petroleum,
Inc., which was effective June 1, 1997.

         Oil and gas  production  costs  decreased  from  $26,496  for the three
months ended June 30, 1997 to $0 for the three months ended June 30, 1998.  This
decrease was due to the sale of the Company's wholly-owned  subsidiary,  Gavilan
Petroleum, Inc., which was effective June 1, 1997.

         Cost of goods sold and operating  expenses  represent  costs related to
the Company's recently  activated asphalt  distribution  company,  Crown Asphalt
Products Company.

         General and  administrative  expenses  increased  from  $81,119 for the
three months ended June 30, 1997 to $111,465 for the three months ended June 30,
1998,  an increase of $30,346  (37%).  This  change was due to  increased  costs
related  to the  Company's  investment  in the  joint  venture  with  MCNIC  and
additional   costs  related  to  the  Company's   recently   activated   asphalt
distribution company, Crown Asphalt Products Company.

         Depletion,  depreciation and amortization decreased from $8,905 for the
three  months  ended June 30, 1997 to $7,951 for the three months ended June 30,
1998.  This  decrease  was  due  to  the  sale  of  the  Company's  wholly-owned
subsidiary,  Gavilan  Petroleum,  Inc., which was effective June 1, 1997 and was
partially offset by depreciation on new assets acquired related to the Company's
growth.

         Other Income  (Expense)  fluctuated from total expenses of $744,712 for
the three  months  ended June 30, 1997 to Other  Income of $30,501 for the three
months ended June 30,  1998.  This  fluctuation  was  primarily  due to interest
income on the  Company's  cash  reserves and a loss on the sale of the Company's
wholly-owned  subsidiary,  Gavilan Petroleum,  Inc., which was effective June 1,
1997.

For the six month period  ended June 30, 1998,  compared to the six months ended
June 30, 1997.

         Asphalt  revenue  increased  from $0 for the six months  ended June 30,
1997 to $186,929 for the six months ended June 30, 1998.  This  increase was due
to revenue from the Company's recently activated asphalt  distribution  company,
Crown Asphalt Products Company.

          Oil and gas revenue  decreased  from  $77,496 for the six months ended
June 30, 1997 to $0 for the six months  ended June 30, 1998.  This  decrease was
due to the sale of the Company's  wholly-owned  subsidiary,  Gavilan  Petroleum,
Inc., which was effective June 1, 1997.

          Oil and gas production costs decreased from $54,653 for the six months
ended June 30, 1997 to $0 for the six months ended June 30, 1998.  This decrease
was due to the sale of the Company's wholly-owned subsidiary, Gavilan Petroleum,
Inc., which was effective June 1, 1997.

         Cost of goods sold and operating  expenses  represent  costs related to
the Company's recently  activated asphalt  distribution  company,  Crown Asphalt
Products Company.

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<PAGE>


         General and administrative expenses increased from $163,998 for the six
months  ended June 30, 1997 to $250,361  for the six months ended June 30, 1998,
an increase of $86,363 (53%).  This change was due to increased costs related to
the Company's  investment in the joint venture with MCNIC and  additional  costs
related to the Company's recently activated asphalt distribution company,  Crown
Asphalt Products Company.

         Depletion, depreciation and amortization decreased from $23,817 for the
six months ended June 30, 1997 to $9,651 for the six months ended June 30, 1998.
This  decrease  was due to the sale of the  Company's  wholly-owned  subsidiary,
Gavilan  Petroleum,  Inc.,  which was  effective  June 1, 1997 and was partially
offset by depreciation on new assets acquired related to the Company's growth.

         Other Income  (Expense)  fluctuated from total expenses of $752,559 for
the six months ended June 30, 1997 to Other Income of $71,205 for the six months
ended June 30, 1998.  This  fluctuation  was primarily due to interest income on
the Company's cash reserves and a loss on the sale of the Company's wholly-owned
subsidiary, Gavilan Petroleum, Inc., which was effective June 1, 1997.

LIQUIDITY AND CAPITAL RESOURCES

         At June 30,  1998,  the  Company had cash and other  current  assets of
$2,125,548  as  compared  to cash and  other  current  assets of  $3,288,989  at
December 31, 1997.  This decrease of $1,163,441 was due to equity  contributions
to the Crown Asphalt Ridge,  L.L.C.  ("Crown Ridge") and a loss from operations.
As of June 30, 1998, the Company had no long-term debt  obligations and believes
it  has  sufficient   capital  to  meet  all  of  its  current  working  capital
requirements and its share of Crown Ridge's budgeted capital requirements.

         In  addition,  the  Company  will  incur  its  proportionate  share  of
operating  expenses of Crown Ridge until such time that Crown Ridge's operations
become profitable.  Furthermore,  should Crown Ridge incur unforeseen additional
capital costs, the Company is obligated to pay its  proportionate  share of such
costs. The Company believes it has sufficient capital to cover such obligations.
However, there can be no assurance that such additional obligations can be met.

         On  July  2,  1998,   Crown  Asphalt   Distribution,   L.L.C.   ("Crown
Distribution"),  a newly formed limited liability  company,  the sole members of
which are MCNIC Pipeline & Processing Company, a Michigan corporation  ("MCNIC")
and Crown Asphalt Products Company ("CAPCO"), a wholly owned subsidiary of Crown
Energy  Corporation,  completed the  acquisition  of the inventory and assets of
Petro Source Asphalt Company, a Texas corporation,  including asphalt supply and
marketing contracts,  owned and leased equipment,  personal property,  fixtures,
equipment  leases,  real  estate  leases,  technology  licenses,  other  related
agreements,  certain intellectual property,  products inventory,  and ownership,
leasehold  or  other  contractual  interests  in  and  to  asphalt  distribution
facilities in Utah, Colorado,  Nevada and Arizona and a refinery in Santa Maria,
California (the "Acquired Assets").

         Crown  Distribution is equally owned by CAPCO and MCNIC, a wholly owned
subsidiary of MCN Energy  Group,  Inc. It is  contemplated  that the business of
Crown Distribution will be operated by CAPCO. No officer,  director or affiliate
of the  Registrant  has a material  relationship  with the Seller.  The Acquired
Assets  (excluding  products  inventory)  were  purchased for $7.5 million,  the
amount  determined  by the parties to be the fair market  value of such  assets,
with capital  contributed to Crown Distribution by MCNIC. The products inventory
had an agreed upon fair market value of $6,797,932  and was  purchased  with the
proceeds of a loan to Crown Distribution from MCNIC.  Because of the uncertainty
concerning the manner or extent in which the  above-described  transaction  will
impact  the  Company  and  its  operations,  management  believes  that  further
discussion of the matter in this section at this time would be inappropriate.

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<PAGE>

                          PART II. - OTHER INFORMATION


ITEM 1.  Legal Proceedings

                  On May 21, 1998,  Road Runner Oil,  Inc.  ("Road  Runner") and
Gavilan  Petroleum,  Inc.  ("Gavilan")  filed an action  in the  Third  Judicial
District  Court,  Salt Lake County,  State of Utah,  as Civil Number  98-0905064
against the Company and its  President.  The action  relates to the  purchase by
Road Runner of 100% of the stock of Gavilan in 1997, and generally  seeks to (i)
obtain corporate records of Gavilan in the Company's  possession relating to the
amount of oil and gas royalties  potentially  owed to third parties prior to the
aforementioned  stock sale, and (ii) to determine the amount of royalties  owed.
The action further alleges, on behalf of Gavilan,  claims of breach of fiduciary
duty,  professional negligence and mismanagement against the Company's President
for alleged  mismanagement of Gavilan's affairs.  The Plaintiffs seek injunctive
relief requiring the tendering by the Company of the referenced records and such
damages as may be proven at trial.  The  Company  believes  that the  Plaintiffs
claims are  groundless  and that it is entitled to payment of the $75,000  still
owed by Road Runner as part of the  purchase  price for  Gavilan.  In  addition,
since the action was filed, the Company has tendered  substantial  quantities of
corporate records to the Plaintiffs for their review. On June 17, 1998, an order
was entered  granting an open extension to the Company of its obligation to file
an answer to the  above-described  Complaint so that the parties may  informally
pursue a settlement, if any, of the matter.

ITEM 2.  Changes in Securities

                  None.

ITEM 3.  Defaults upon Senior Securities

                  None.

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

                  None.

ITEM 5.  Other Information

                  None.

ITEM 6.  Exhibits and Reports on Form 8-K

                  Exhibit           Name
                      27            Financial Data Schedule


                  The  Company  filed a Form 8-K on June 8,  1998,  to  report a
                  change in auditors.  The Company also filed a Form 8-K on July
                  17,  1998,  to report the  acquisition  of the  inventory  and
                  assets of Petro Source Asphalt Company.

                                       16

<PAGE>

                             PART III. - SIGNATURES


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                                   CROWN ENERGY CORPORATION
                                                   (Registrant)

Date: August 14, 1998                              By: /s/ JAY MEALEY
   ------------------------------------               -------------------------
                                                      Jay Mealey, President

Date: August 14, 1998                              By: /s/ RICHARD S. RAWDIN 
    ------------------------------------              -------------------------
                                                      Richard S. Rawdin, 
                                                      Vice President of Finance



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