|UNITED STATES
      SECURITIES AND EXCHANGE COMMISSION
      Washington, D.C. 20549 | 
|----------------------------------------------------------------------------------- | 
|OMB APPROVAL                                                                       
|OMB Number: 3235-0416                                                              
|Expires: April 30,2003                                                             
|Estimated average burden
      hours per response: 32.00                           

FORM 10-QSB



(Mark One)

|[X ]                                                                          | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934
|----------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------
|For the quarterly period ended ___June 30, 2003______________________________
|                                                                             
|[ ]                                                                           | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
      EXCHANGE ACT                  
|For the transition period from _________________ to
      _________________  
|                                                                             
|Commission file number ___0-30118____________________________________        

EMPYREAN
COMMUNICATIONS INC.

(exact name of small
business issuer as specified in its charter)

2537 South Gessner,
Suite 114,

Houston, TX 77063

(address of principal
executive offices)

Issuers telephone
number: (713) 260 7236

|                                                                                                                                                                                
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                
|___NEVADA_____________________________________
      (State or other jurisdiction of incorporation or organization)                                                             
|                                                                                                                                                                                
|                                                                                                                                                                                
|                                                                                                                                                                                
|(713) 260-7236(Issuer's telephone number)( 713) 260 7236                                                                                                                        
|                                                                                                                                                                                
|_________________________________________________________________________________
      (Former name, former address and former fiscal year, if changed since last
      report)



Check whether the issuer

1. filed all documents and reports required to be filed by Section 13 or
    15(d) of the Exchange Act during the last 12months(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 (X) Yes
    ( ) No





_As of June 30, 2003 there were 9,415,951 shares of common stock
issued and outstanding

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





PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Following are the un-audited financial statements for the period
ended June 30, 2003:







|EMPYREAN COMMUNICATIONS INC.                                                                                         
|---------------------------------------------------------------------------------------------------------------------
|(A Development Stage Company)                                                                                        
|STATEMENT OF CASH FLOWS                                                                                              
|For the three month periods ended June 30, 2003 and 2002
      and the six month periods ended June 30, 2003 and 2002
|and for the period October 30,2000 (Date of
      Incorporation) to June 30, 2003                                    
|(Unaudited)                                                                                                          
|                                                                                                                     
|Cash Flows used in Operating Activites                                                                               
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|Investing Activities                                                                                                 
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|Financing Activities                                                                                                 
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     
|                                                                                                                     





|EMPYREAN COMMUNICATIONS INC.                                    
|----------------------------------------------------------------
|(A Development Stage Company)                                   
|BALANCE SHEETS                                                  
|for the periods ended March 31, 2003 and December 31,
      2002



|                                    |                                                  |                                            |                |              |                  
|----------------------------------- | ------------------------------------------------ | ------------------------------------------ | -------------- | ------------ | -----------------
|                                    |                                                  |                                            | March 31, 2003 |              | December 31, 2002
|                                    |                                                  |                                            | Unaudited      |              |                  
|Assets                              |                                                  |                                            |                |              |                  
|                                    | Cash                                             |                                            | 6              |              | -                
|                                    | Prepaid expenses - see accompanying notes        | 406,722                                    |                | 258,679     
|                                    |                                                  | to financial statements                    |                |              |                  
|                                    |                                                  |                                            |                |              |                  
|Total Assets                        |                                                  | 406,728                                    |                | 258,679     
|                                    |                                                  |                                            |                |              |                  
|                                    |                                                  |                                            |                |              |                  
|Liabilities                         |                                                  |                                            |                |              |                  
|                                    | Accounts Payable - see accompanying notes        |                                            |                |             
|                                    |                                                  | to financial statements                    | 71,620         |              | 66,891           
|                                    | Short Term Note Payable                          | 7,500                                      |                | -           
|                                    | Due to shareholders - see accompanying notes     |                                            |                |             
|                                    |                                                  | to financial statements                    | 23,249         |              | 34,011           
|                                    |                                                  |                                            |                |              |                  
|Total Liabilities                   |                                                  | 102,369                                    |                | 100,902     
|                                    |                                                  |                                            |                |              |                  
|Stockholders Equity                 |                                                  |                                            |                |             
|                                    | Capital Stock                                    |                                            |                |             
|                                    | Authorized:                                      |                                            |                |             
|                                    | 50,000,000 common shares, $0.001 par value       |                                            |                |             
|                                    | 10,000,000 preferred sharess, $0.001 par value   |                                            |                |             
|                                    | Issued:                                          |                                            |                |              |                  
|                                    | 8,265,951 (2002: 2,525,951) common shares - see  |                                            |                |             
|                                    |                                                  | accompanying notes to financial statements | 8,240          |              | 2,500            
|                                    | 10,000,000 preferred sharess                     | 10,000                                     |                | 10,000      
|                                    | Additional paid in capital                       | 10,625,619                                 |                | 10,464,559  
|                                    | Deficit accumulated during the development stage | (10,339,500)                               |                | (10,319,282)
|                                    |                                                  |                                            |                |              |                  
|Total Stockholders Equity/(Deficit) | 304,359                                          |                                            | 157,777       
|                                    |                                                  |                                            |                |              |                  
|                                    | Liabilities and Shareholders Equity/(Deficit)    | 406,728                                    |                | 258,679     



|EMPYREAN COMMUNICATIONS INC.                                                  
|------------------------------------------------------------------------------
|(A Development Stage Company)                                                 
|Income Statement                                                              
|for the Three Months and Six Months Periods Ended June
      30, 2003 and 2002
|with cummulative since inception                                              
|                                                                              
|(UNAUDITED)                                                                   



|                                    |                                 |          | For the Three Months Ended June 30, 2003 |           | For the Three Months Ended June 30, 2002 |          | For the Six Months Ended June 30, 2003 |           | For the Six Months Ended June 30, 2002 |              | October 30,2000 (Date of Incorporation) to June 30, 2003
|----------------------------------- | ------------------------------- | -------- | ---------------------------------------- | --------- | ---------------------------------------- | -------- | -------------------------------------- | --------- | -------------------------------------- | ------------ | --------------------------------------------------------
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|Operating Expenses                  |                                 | 14,328   |                                          | 444,772   |                                          | 20,218   |                                        | 548,795   |                                        | 2,004,158   
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|Operating Loss                      |                                 | (14,328) |                                          | (444,772) |                                          | (20,218) |                                        | (548,795) |                                        | (2,004,158) 
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|Other Income/(Expenses)             |                                 |          |                                          |           |                                          |          |                                        |           |                                        |             
|                                    | Investments written-off         |          | -                                        |           | -                                        |          |                                        |           |                                        |              | (2,600,000)                                             
|                                    | Loss on write-off of technology |          | -                                        |           | -                                        |          |                                        |           |                                        |              | (5,843,140)                                             
|                                    | Accounts payable written-off    |          | -                                        |           | -                                        |          |                                        |           |                                        |              | 68,227                                                  
|                                    | Miscellaneous Income            |          | -                                        |           | -                                        |          |                                        |           |                                        |              | 9,993                                                   
|                                    | Gain on forgiveness of debt     |          | -                                        |           | -                                        |          |                                        |           |                                        |              | 29,578                                                  
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|Net Loss for the period             |                                 | (14,328) |                                          | (444,772) |                                          | (20,218) |                                        | (548,795) |                                        | (10,339,500)
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|                                    |                                 |          |                                          |           |                                          |          |                                        |           |                                        |              |                                                         
|Basic loss per share                |                                 |          |                                          |           |                                          |          |                                        |           |                                        |             
|Shares Outstanding                  |                                 |          |                                          |           |                                          |          |                                        |           |                                        |             
|Weighted Average Shares Outstanding |                                 |          |                                          |           |                                          |          |                                        |           |                                        |             



|                                                       
|-------------------------------------------------------
|(A Development Stage Company)                          
|STATEMENT OF STOCKHOLDERS EQUITY/(DEFICIT)             
|for the period ended June 30, 2003                     
|(Unaudited)                                            
|                                                       
|Balance, December 31, 2001                             
|                                                       
|Issued for acquisition of subsidiary                   
|                                                       
|Net loss for the period                                
|                                                       
|Balance, March 31, 2002                                
|                                                       
|Issued for controlling interest in Basalt Fiber Company
|                                                       
|Issued pursuant to consulting fee agreements           
|                                                       
|Net loss for the period                                
|                                                       
|Balance, June 30, 2002                                 
|                                                       
|Issued pursuant to consulting fee agreements           
|                                                       
|Net loss for the period                                
|                                                       
|Balance, September 30, 2002                            
|                                                       
|Net loss for the period                                
|                                                       
|Balance, December 31, 2002                             
|                                                       
|Issued for cash at $0.02                               
|                                                       
|Net loss for the period                                
|                                                       
|Balance, March 31, 2003                                
|                                                       
|Issued for cash at $0.02                               
|                                                       
|Issued pursuant to consulting fee agreements           
|                                                       
|Net loss for the period                                
|                                                       
|Balance, June 30, 2003                                 



Item 2. Management's Plan of Operation.

The company is in its initial stages of development with no
revenues or income and is subject to all the risks inherent in the creation of a
new business. Since the company's principal activities to date have been
limited to organizational activities, prospect development, and acquisition of
interest, it has no record of revenue-producing operations. Consequently, there
is no operating history upon which to base an assumption that the company will
be able to achieve it's business plans

The company's aggressive and unwavering business focus is to
pursue all available avenues in order to obtain the funding required to commence
the manufacture and sales of continuous basalt fiber and related products.

The company's wholly owned subsidiary, Basalt Fiber Company
terminated the lease for the factory building in South Hill, Virginia to reduce
monthly expenditures. The action taken however does not affect in any way the
Industrial Revenue Bonds, various grants and tax abatements granted to the
company by the State of Virginia, provided the company sets up it's
manufacturing facilities in the county of Mecklenburg, before the end of 2004.
Management continues to be fully primed to either reinstate this lease or secure
another suitable lease property in Mecklenburg county and install manufacturing
facilities as soon as the financing being sourced, is obtained. Production of
basalt fiber is expected to commence within a year of financing being obtained
and conservative gross sales revenues are projected to be in excess of $2.50
million in the second year and should exceed $8.50 million by the fifth year.
During this quarter, several promising sources of financing have been in contact
with management and meetings held.

In brief, Basalt fiber is the newest fiber application
technology available to the Western Hemisphere. Basalt Fiber can effectively
replace fiberglass in all its applications. It is also stronger, ecologically
safer and more cost effective than fiberglass. As the properties of Basalt Fiber
are far superior than fiber glass, it will command premium prices for all its
products. The many exciting uses of basalt fiber include its application in
industry, the military, local law enforcement and fire safety. Furthermore,
Basalt Fiber's superior strength and advanced thermal properties will aid in
the construction of much stronger and more fire resistant structures. It can
also be used to enhance fire resistant apparel for firefighters and stronger
bulletproof vests for law enforcement personnel.

The prolonged, depressed and uncertain economic conditions have,
no doubt, placed a severe constraint on the company's efforts to raise
capital. In June, 2003,a revamping of the company's strategy was undertaken
and announced in a Press Release. Management has rationalized its Basalt Fiber
business with a revised Business Plan that will require only $650,000 to become
revenue producing. It is also the intention to diversify into the Real Estate,
Financial services and Oil and gas sectors and management is actively pursuing
these objectives. A promising Real Estate development project is being reviewed
and to reflect the company's diversification strategy a name change will be
undertaken at a shareholders meeting tentatively scheduled for the end of
September this year. Shareholders will also be requested to approve the increase
of the company's capital structure.

Principal Product

Until the company's recently formulated diversification policy
makes significant progress, Management will continue to give priority to
obtaining the financing that it's wholly owned subsidiary, Basalt Fiber
Company, requires to manufacture continuous Fiber products for resale in the
world market. From start up, the company is expected to grow at a 20% to 25%
rate and the list of the main objectives to be strictly pursued by top
management are:

- to provide Basalt Fiber Company the market presence, which is necessary to
    support production, marketing and sale goals and to attract customers from
    the niche markets for the Basalt Fiber products
- Generate a fair return for shareholders and finance continued growth and
    development of quality products with earned profits
- To have sales of more than 8.50 million by the fifth year .
- To achieve a gross margin of 73 % and to have checks and balances in place
    to maintain this level
- To continue research and development into the next generation of fiber
    products and
- Achieve a steady and reliable production stream

Liquidity

During the next 12 months, the company will need significant
working capital to fund its marketing efforts and to commence the manufacturing
of Basalt Fiber products. The Company continues to actively pursue financing
from all available sources both in this country and overseas. Consideration will
also be given to raising funds through a Private Placement once the economy
improves.

PART II - OTHER INFORMATION

Item 5. Other Information

Board Meetings:

The Board of Directors, at a Special meeting held in Houston,
Texas on February 21, 2003, approved the issuance of 5.200,000 common shares
through an S 8 filing , for prepaid legal fees and in lieu of future consulting
fees. .Shares were issued as follows:

James B. Parsons 500,000 shares for Prepaid legal fees of
$15,000.00

James D. Smith 200,000 shares for prepaid consulting fees of
$6,000.00

Howard A, Scala 1,500,000 shares for prepaid consulting fees of
$45,000.00

Anthony Fanale 1,500,000 shares for prepaid consulting fees of
$45,000.00

Robert L. Lee 1,500,000 shares for prepaid consulting fees of
$45,000.00

Sale of restricted stock:

During the quarter 340,000 restricted shares were sold to an
investor for $5,800.00



Item 6. Exhibits and Reports on Form 8-K

|Exhibit No. | Document                  | Location        
|----------- | ------------------------- | ----------------
|3(i)        | Articles of Incorporation | Previously Filed
|3(ii)       | Bylaws                    | Previously filed

________________________________________________________________________

Reports on Form 8-K

NIL



SIGNATURES

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

EMPYREAN COMMUNICATIONS,
INC.







/s/ Robert L.
Lee     Date August 14, 2003

Robert L. Lee, President
and Director







/s/ Anthony Fanale  Date August 14, 2003

Anthony Fanale, Director

*Print the name and
title of each signing officer under his signature.





CERTIFICATION PURSUANT
TO SECTION 302

OF THE SARBANES-OXLEY
ACT OF 2002

I, Robert L. Lee, certify that:

1. I have reviewed this quarterly
report on Form 10-QSB of Empyrean Communication, Inc. for the quarter ended June
30, 2003;

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.

4. The registrant's other
certifying offering 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 we have: a) designed such disclosure
controls and procedures to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this
quarterly report is being prepared; b) 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 c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;

5. The registrant's other
certifying officers and I have disclosed, based on our most recent evaluation,
to the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent function): a) 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 b) any fraud, whether or not
material, that involves management or other employees who have a significant
role in the registrant's internal controls; and

6. 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: August 14, 2003



/s/ Robert L. Lee
Robert L. Lee
President



CERTIFICATION PURSUANT
TO

SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION
1350)





In connection with
the Quarterly Report of Empyrean Communications, Inc.., a Nevada
corporation (the "Company"), on Form 10-QSB for the quarter
ending June 30, 2003 as filed with the Securities and Exchange Commission (the
"Report"), I, Robert L. Lee,  President of the Company, certify,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350), that
to my knowledge:



(1) The Report fully
complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and



(2) The information
contained in the Report fairly presents, in all material respects, the financial
condition and result of operations of the Company.







/s/ Robert L.
Lee

Robert L. Lee, President

Dated: August 14,
2003