|-----------------------                                                                                                                                                                                                                                                                                     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                            
|UNITED STATES                                                                                                                                                                                                                                                                                               
|SECURITIES AND EXCHANGE COMMISSION                                                                                                                                                                                                                                                                          
|Washington, D.C. 20549                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                            
|FORM 10-QSB                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                            
|[X]                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                            
|[  ]                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                            
|COMMISSION FILE NUMBER: 0-5525                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                            
|CASTLEGUARD ENERGY, INC.                                                                                                                                                                                                                                                                                    
|(Exact name of Registrant as specified in its charter)                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                            
|Florida
(State or other jurisdiction of 
of incorporation or organization)                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                            
|4625 Greenville Avenue, Suite 203, Dallas, TX
(Address of principal executive offices)                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                            
|(214) 361-1755                                                                                                                                                                                                                                                                                              
|(Registrant's telephone number, including area code)                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                            
|Securities registered pursuant to Section 12(b) of the Act: NONE                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                            
|Securities registered pursuant to Section 12(g) of the Act:                                                                                                                                                                                                                                                 
|Common Stock Without Par Value                                                                                                                                                                                                                                                                              
|(Title of Class)                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                            
|Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
|                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                            
|At March 31, 2002, there were 17,284,626 Common shares outstanding.                                                                                                                                                                                                                                         
|______________________________                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                            
|Transitional Small Business Disclosure Format (check one): Yes [   ] No [X]                                                                                                                                                                                                                                 





|CASTLEGUARD ENERGY, INC.
|------------------------
|                        
|INDEX                   

|           |                                                                                                               | 
|---------- | ------------------------------------------------------------------------------------------------------------- | 
|Part 1.    | Financial Information:                                                                                        | 
|           |                                                                                                               | 
|Item 1.    | Financial Statements                                                                                          | 
|           |                                                                                                               | 
|           | Accountant's Review Report                                                                                    | 
|           |                                                                                                               | 
|           | Balance Sheets - 
March 31, 2002 (Unaudited) and December 31, 2001 (Audited)                                  | 
|           |                                                                                                               | 
|           | Statements of Income -
For the Three Months Ended March 31, 2002 and 2001 (Unaudited)                         | 
|           |                                                                                                               | 
|           | Statements of Cash Flows - 
For the Three Months Ended March 31, 2002 and 2001 (Unaudited)                    | 
|           |                                                                                                               | 
|           | Statements of Stockholders' Equity -
 For the year 2001 and the Three Months ended March 31, 2002 (Unaudited) | 
|           |                                                                                                               | 
|           | Notes to Financial Statements                                                                                 | 
|           |                                                                                                               | 
|Item 2.    | Management's Discussion and Analysis of Financial Condition and 
  Results of Operations                      | 
|           |                                                                                                               | 
|Part II.   | Other Information:                                                                                            | 
|           |                                                                                                               | 
|Item 1.    | Legal Proceedings                                                                                             | 
|           |                                                                                                               | 
|Item 2.    | Changes in Securities and Use of Proceeds                                                                     | 
|           |                                                                                                               | 
|Item 3.    | Defaults Upon Senior Securities                                                                               | 
|           |                                                                                                               | 
|Item 4.    | Submission of Matters to a Vote of Security Holders                                                           | 
|           |                                                                                                               | 
|Item 5.    | Other Information                                                                                             | 
|           |                                                                                                               | 
|Item 6.    | Exhibits and Reports on Form 8-K                                                                              | 
|           |                                                                                                               | 
|Signatures |                                                                                                              
|           |                                                                                                              











|Item 1. FINANCIAL STATEMENTS
|----------------------------
|                            
|                            
|                            





|REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Board of Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Castleguard Energy, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|We have reviewed the accompanying balance sheets of Castleguard Energy, Inc. as of March 31, 2002, and the related statements of income and cash flows for the three month period then ended. These financial statements are the responsibility of the Company's management.                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of analytical procedures applied to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Based on our reviews, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with generally accepted accounting principles.                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Jackson & Rhodes P.C.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Dallas, Texas                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|May 9, 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     





|CASTLEGUARD ENERGY INC.
|-----------------------
|                       
|                       
|BALANCE SHEETS         
|                       

|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|---------------------------------------- | ------------------------------------------------------------------------ | -------------------------- | -------- | --------- | --------- | -------------- | --------- |  | -----------------
|                                         |                                                                          |                            |          |           |           | March 31,
2002 |           |  | December 31,
2001
|                                         |                                                                          |                            |          |           |           | (Unaudited)    |           |  | (Audited)        
|ASSETS                                  
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|Current assets:                          |                                                                          |                            |          |           |           |                |          
|                                         | Cash                                                                     | $                          | 124,488  |           | $         | 99,979        
|                                         | Accounts receivable                                                      |                            |          | 95,008    |           |                | 146,877  
|                                         |                                                                          | Total current assets       |          | 219,496   |           |                | 246,856  
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|Petroleum and natural gas interests, net |                                                                          | 1,401,739                  |          |           | 1,459,384
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|Deferred debt issue cost, net            |                                                                          | 27,062                     |          |           | -        
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|TOTAL ASSETS                             |                                                                          |                            | $        | 1,648,297 |           | $              | 1,706,240
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|LIABILITIES & STOCKHOLDERS' EQUITY      
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|Current liabilities:                     |                                                                          |                            |          |           |           |                |          
|                                         | Accounts payable and accrued liabilities                                 | $                          | 21,416   |           | $         | 83,880        
|                                         | Current portion of long-term debt                                        |                            | 260,004  |           |           | 238,337       
|                                         |                                                                          | Total current liabilities  |          | 281,420   |           |                | 322,217  
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|Long-term debt, less current portion     |                                                                          | 330,668                    |          |           | 367,078  
|Accrued stock to be issued               |                                                                          | -                          |          |           | 7,315    
|Deferred income taxes                    |                                                                          | 66,780                     |          |           | 61,000   
|                                         |                                                                          |                            |          |           |           |                |          
|TOTAL LIABILITIES                        |                                                                          | 678,868                    |          |           | 757,610  
|                                         |                                                                          |                            |          |           |           |               
|Stockholders' equity:                    |                                                                          |                            |          |           |          
|                                         | Common stock, $0.001 par value,                                          |                            |          |           |           |               
|                                         | 50,000,000 shares authorized; 19,146,626 
  and 19,013,626 shares issued |                            | 19,147   |           |           | 19,014        
|                                         | Paid-in capital                                                          |                            | 965,824  |           |           | 958,643       
|                                         | Retained earnings                                                        |                            | 40,458   |           |           | 26,973        
|                                         | Less: Treasury stock, 1,862,000 shares at cost                           |                            | (56,000) |           |           | (56,000)      
|                                         |                                                                          | Total stockholders' equity |          | 969,429   |           |                | 948,630  
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $                                                                        | 1,648,297                  |          | $         | 1,706,240
|                                         |                                                                          |                            |          |           |           |                |           |  |                  
|                                         |                                                                          |                            |          |           |           |                |           |  |                  



|CASTLEGUARD ENERGY INC.          
|---------------------------------
|                                 
|                                 
|STATEMENTS OF INCOME             
|(Unaudited)                      
|                                 
|                                 
|                                 
|                                 
|                                 
|Oil and gas sales                
|                                 
|Expenses:                        
|                                 
|                                 
|                                 
|                                 
|Income from operations           
|                                 
|Interest and financing costs     
|                                 
|Income before income taxes       
|                                 
|Provision for income taxes       
|                                 
|Net income                       
|                                 
|Basic earnings per common share  
|                                 
|Weighted average number of common
|                                 
|                                 
|                                 





|CASTLEGUARD ENERGY INC.                            
|---------------------------------------------------
|                                                   
|STATEMENTS OF CASH FLOWS                           
|(Unaudited)                                        
|                                                   
|                                                   
|                                                   
|                                                   
|Cash Flows from Operating Activities:              
|                                                   
|                                                   
|                                                   
|                                                   
|                                                   
|                                                   
|                                                   
|                                                   
|Net cash provided by (used in) operating activities
|                                                   
|Cash Flows from Investing Activities:              
|                                                   
|Net cash (used in) investing activities            
|                                                   
|Cash Flows from Financing Activities:              
|                                                   
|                                                   
|Net cash provided (used) by financing activities   
|                                                   
|Net increase in cash and cash equivalents          
|Cash and cash equivalents, beginning of period     
|Cash and cash equivalents, end of period           
|                                                   
|                                                   





|CASTLEGUARD ENERGY INC.                
|---------------------------------------
|                                       
|STATEMENTS OF STOCKHOLDERS' EQUITY     
|(Unaudited for year 2002 first quarter)
|                                       
|                                       
|                                       
|                                       
|                                       
|                                       
|Balance, December 31, 2000             
|                                       
|Issuance of stock accrued              
|                                       
|Issuance of stock for services         
|                                       
|Net income                             
|                                       
|Balance, December 31, 2001             
|                                       
|Issuance of stock                      
|To settle litigation                   
|                                       
|Net income                             
|                                       
|Balance, March 31, 2002                
|                                       
|                                       





|CASTLEGUARD ENERGY, INC                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|NOTES TO FINANCIAL STATEMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Note 1 - Future Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|The Company's financial statements are prepared using generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company is in the process of growing through the acquisition of oil and gas interests. The Company intends to finance this growth through future cash flow, the issuance of common stock and debt. Future growth may be limited by the extent of internally generated cash flow, the Company's ability to obtain financing from share issuances and debt to finance future expansion of working interests.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Note 2 - Summary of Significant Accounting Policies and Practices                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Note 3 - Long-Term Debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Long-term debt is a secured note payable to a commercial bank, payable at $21,667 per month plus interest at the Wall Street Journal's prime rate plus 3/4 of one percent. The note is collateralized by the company's interest in oil and gas properties and is also guaranteed by two directors of the Company. Maturities of the debt are as follows:                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Debt covenants restrict other debt, pledge of assets, payments of dividends, mergers and changes in ownership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Note 4 - Related Party Transactions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|In January, 2001, the Company's directors entered into an agreement with H & S Production, Inc. (a company wholly owned by the Company's Chairman, Scott Heape) to participate in a farmout agreement covering leasehold interests in the Mings Chapel Field in East Texas whereby the Company has the opportunity to participate in up to three development wells. The first and second wells were drilled, completed, and put on line in 2001. A third well is planned to be drilled in the summer of 2002; additionally, four proven but undeveloped locations have been identified as a result of the first two wells drilled on this prospect.       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          





|Item 2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|CASTLEGUARD ENERGY, INC.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|CONDITION AND RESULTS OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|This Quarterly Report on Form 10-QSB includes "forward-looking" statements within the meaning of Section 27a of the Securities Act of 1933, as amended (the "Securities Act"), and section 21e of the Securities Exchange Act of 1934, as amended (the "exchange act"). Specifically, all statements other than statements of historical facts included in this report regarding the Company's financial position, business strategy and plans and objectives of management of the Company for future operations are forward- looking statements. These forward-looking statements are based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. When used in this report, the words "anticipate," "believe," "estimate," "expect" and "intend" and words or phrases of similar import, as they relate to the Company or Company management, are intended to identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions related to certain factors including, without limitation, price levels for oil and natural gas, concentration of oil and natural gas reserves and production, drilling risks, uncertainty of oil and gas reserves, risks associated with the development of additional revenues and with the acquisition of oil and gas properties and other energy assets, operating hazards and uninsured risks, general economic conditions, governmental regulation, changes in industry practices, marketing risks, one time events and other factors described herein ("cautionary statements"). Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Based upon changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. The Company does not intend to update these forward- looking statements. All subsequent written and oral forward- looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the applicable cautionary statements. Reference is made to disclosure regarding "Forward-Looking Statements and Cautionary Statements" included in the Company's Annual Report on Form 10-KSB for the year ended December 31, 2001, which is incorporated herein by reference.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|The Company is an independent oil and gas exploration company whose strategic focus is the application of advanced seismic imaging and computer-aided exploration technologies in the systematic search for commercial hydrocarbon reserves, primarily in the states of Texas and Louisiana. The Company attempts to leverage its technical experience and expertise with seismic to identify exploration and exploitation projects with significant potential economic return. The company intends to participate in selected exploration projects as a non-operating, working interest owner, sharing both risk and rewards with its partners. The Company has and will continue to pursue exploration opportunities in regions where the Company believes significant opportunity for discovery of oil and gas exists. By reducing drilling risk through seismic technology, the Company seeks to improve the expected return on investment in its oil and gas exploration projects. The Company attempts to limit capital requirements by forming industry alliances and exchanges a portion of its interest for cash and/or a carried interest in its exploration projects.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

|RESULTS OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Three Month Periods Ended March 31, 2002 vs. 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Year 2002 (this year) first quarter results declined from 2001 (last year) first quarter, as total hydrocarbon sales volumes and prices for natural gas declined. The volume decline for gas of 5.2% was largely attributable to decreased gas sales from the Company's working interests in the Minden Dome area of Louisiana, where the operator slowed production as the result of low prices. Natural gas sales volumes this year were 66,668 MCF vs. 70,336 MCF last year. Sales prices dropped from $7.29 per MCF in 2001 to $2.36 per MCF in 2002.                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Lease operating expenses in 2002 were up from 2001 as more wells were in operation this year than last. Depletion, depreciation and amortization (DD&A) provisions were also higher this year as the rate per mcf rose compared to last year as the result of lower reserves on which DD&A is based. General and administrative expenses were lower reflecting management's efforts to contain costs in a period of lower prices. Interest expense declined as the result of lower rates for the Company's borrowings coupled with lower debt. Income from operations and net income were lower than last year primarily from lower prices for hydrocarbons.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|LIQUIDITY AND CAPITAL RESOURCES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Cash flow in the quarter ended March 31, 2002 was more than adequate to provide operating capital, meet obligations to fund interest and debt payments while increasing cash at quarter end by $24,509 from December 31, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The Company plans to participate in additional wells in the Mings Chapel field as well as participating in other opportunities in 2002. Cash flow from all of the Company's working interests is expected to adequately fund current operating needs, provide cash for debt repayment and partially fund additional new projects or additional wells in existing producing fields. However, the Company expects to require additional financing to fully exploit all its opportunities and such financing must be arranged in the coming months. The lack of additional funding will limit the Company's deal flow in the future.                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Part II. Other Information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Item 1. Legal Proceedings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Not Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Item 2. Changes in Securities and Use of Proceeds                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Not Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Item 3. Defaults Upon Senior Securities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Not Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Item 4. Submission of Matters to a Vote of Security Holders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Not Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Item 5. Other Information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Not Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            



|Item 6. Exhibits and Reports on Form 8-K
|----------------------------------------
|                                        



|(a) | Exhibits -                                                                                                            
|--- | ----------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                       
|(b) | Reports on Form 8-K - 	No Reports on Form 8-K were filed during the last quarter of the period covered by this report.
|    |                                                                                                                       
|    |                                                                                                                       









|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.
|                                                                                                                                                                                        

|             | CASTLEGUARD ENERGY, INC.            
|------------ | ------------------------------------
|             |                                     
|             |                                     
|May 14, 2002 |                                     
|             | BY: Bob G. Honea, Director/President