FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

For the quarterly period ended           September 30, 1996
                               ----------------------------

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

For the transition period from ________________ to____________________

Commission file number     1-4668

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
 ................................................................................
              Exact name of registrant as specified in its charter)

            BERMUDA                                      NONE
 ................................................................................
(State or other jurisdiction of                    (I.R.S. Employer
 incorporation or organization)                    Identification No.)

Clarendon House, Church Street, Hamilton, Bermuda        NONE
 ................................................................................
 (Address of principal executive offices)             (Zip Code)

                                  809-295-1422
 ................................................................................
              (Registrant's telephone number, including area code)

 ................................................................................
              (Former name, former address and former fiscal year,
                          if changed since last report)

     Indicate  by check mark  whether the  registrant  (l) has filed all reports
required to be filed by Section 13 or 15 (d) of the  Securities  Exchange Act of
l934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                                         X Yes   No

     The number of shares  outstanding  of the  issuer's  single class of common
stock as of October 15, 1996 was 40,046,358.



<PAGE>



                         PART 1 - FINANCIAL INFORMATION


                         ITEM 1. - FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                             (A Bermuda Corporation)
                           A Development Stage Company

                           CONSOLIDATED BALANCE SHEET
                           (Expressed in U.S. dollars)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                           September 30,        December 31,

                                                                               1996                 1995
                                                                               -----                ----

                                 ASSETS
<S>                                                                          <C>                  <C>

Current assets:
  Cash and cash equivalents                                                  $     569,731        $    247,452
  Accounts and interest receivable                                                  44,642               6,836
  U.S. government securities                                                     5,343,814                   -
  Prepaid insurance                                                                178,067             125,342
                                                                              ------------        ------------
          Total current assets                                                   6,136,254             379,630


Unproved oil, gas and mineral properties (full cost method)                      3,877,928           3,688,568
Other                                                                               25,514              59,708
                                                                             -------------       -------------
                                                                               $10,039,696        $  4,127,906
                                                                               ============       ============



                  LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Accounts payable and accrued liabilities                                  $       59,060      $       71,212
                                                                            --------------      --------------

Minority interests
                                                                                        -                    -
                                                                                        -                    -

Shareholders' equity:
  Common stock, par value 12(cent) per share:
  Authorized  - 100,000,000 shares
  Outstanding - 40,046, 358 and 33,363,632 shares, respectively                  4,805,563           4,003,636
  Capital in excess of par value                                                28,202,983          22,395,084
                                                                               -----------         -----------
                                                                                33,008,546          26,398,720
  Deficit accumulated during development stage                                 (23,027,910)        (22,342,026)
                                                                              -------------        ------------
                                                                                 9,980,636           4,056,694
                                                                             -------------       -------------
                                                                               $10,039,696       $   4,127,906
                                                                               ===========       =============
</TABLE>

<PAGE>


                         PART 1 - FINANCIAL INFORMATION

                          ITEM 1 - FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                             (A Bermuda Corporation)
                           A Development Stage Company

                      CONSOLIDATED STATEMENT OF OPERATIONS
                           (Expressed in U.S. dollars)
                                   (unaudited)

<TABLE>
<CAPTION>

                                                                                                                   From inception
                                                  Three months ended                    Nine months ended          (Jan. 31, 1953)
                                                  ------------------                    -----------------                           
                                                    September 30,                         September 30,           to September 30,
                                                    -------------                         -------------           ----------------
                                               1996                1995               1996              1995             1996
                                               ----                ----               ----              ----             ----


<S>                                          <C>                <C>                 <C>               <C>             <C>           

Interest and other income                     $78,698           $   3,389           $113,890          $  12,081       $3,148,178
                                              -------           ---------           --------          ---------       ----------

Expenses:
  Legal fees and costs                        115,112              78,069            336,621            241,215       10,028,914
  Administrative expenses                      78,677              62,789            244,681            244,923        5,827,614
  Salaries                                     36,500              39,500            112,167            110,167        2,555,778
  Shareholder communications                   21,524              11,647             82,699             81,981        3,237,538
  Exploration costs                            17,955               2,022             23,606              2,703          696,709
  Lawsuit judgments                                 -                   -                                     -        1,941,916
  Minority interests                                -                   -                                     -         (632,974)
  Other                                             -                   -                                     -          364,865
  Contractual services                              -                   -                  -                  -        2,155,728
                                         ---------------     ---------------    ----------------   ---------------   -----------
                                              269,768             194,027            799,774            680,989       26,176,088
                                            ---------           ---------         ----------          ---------       ----------

Net loss                                    $(191,070)          $(190,638)         $(685,884)         $(668,908)
                                            ==========          ==========         ==========         ==========

Deficit accumulated during
  development stage                                                                                                 $(23,027,910)
                                                                                                                    ============
Average number of shares
  outstanding                              40,046,358          33,363,632         36,706,995         33,363,632
                                          ============         ==========        ===========         ==========

Net loss per share                              $ -               $(.01)             $(.02)            $(.02)
                                                ===               ======             ======            ======
</TABLE>

<PAGE>


                         PART 1 - FINANCIAL INFORMATION

                         ITEM 1. - FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                             (A Bermuda Corporation)
                           A Development Stage Company
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                           (Expressed in U.S. Dollars)
                                   (unaudited)

<TABLE>
<CAPTION>

                                                                                                  From inception
                                                               Nine months ended                  (Jan. 31, 1953)
                                                                  September 30,                   to September 30,
                                                               1996               1995                   1996
                                                            -----------        -----------        ----------------
<S>                                                        <C>                  <C>                <C>

Operating activities:
Net loss                                                   $  (685,884)         $(668,908)         $(23,027,910)
Adjustments to reconcile net loss
  to net cash used for operating activities:
    Minority interest                                                -                  -              (632,974)
    Exploration and other                                            -                  -               755,974
    Net change in:
       Accounts receivable                                     (37,805)           (22,209)              (44,642)
       U.S. Government securities                           (5,343,814)                 -            (5,343,814)
       Prepaid insurance                                       (52,725)            16,822              (178,067)
       Current liabilities                                     (12,152)           (13,239)               59,060
       Other                                                    34,193                  2               473,392
                                                          ------------    ---------------          ------------
Net cash used for operating activities                      (6,098,187)          (687,532)          (27,938,981)
                                                           ------------        -----------          ------------

Investing activities:
  Additions to oil, gas, and mineral
    properties net of assets acquired
    for common stock                                          (189,360)                 -            (3,877,928)
  Reimbursement of lease rentals and
    other expenses                                                   -                  -             1,243,086
  Purchase of fixed assets                                           -                  -                     -
Net cash used for investing activities                                -                 -               (61,649)
                                                      -----------------  ----------------         --------------
                                                              (189,360)                 -            (2,696,491)
Financing activities:
  Cash proceeds from sale of
    common stock less expenses                               6,356,326                  -            26,342,204
  Shares issued upon exercise of
    options                                                     13,500                  -               872,999
  Sale of shares by subsidiary                                       -                  -               750,000
  Sale of subsidiary shares                                    240,000            360,000             3,240,000
                                                          ------------        -----------           -----------
Net cash provided by
  financing activities                                       6,609,826            360,000            31,205,203
                                                           -----------        -----------           -----------
Net increase (decrease) in cash
  and cash equivalents                                         322,279           (327,532)              569,731
Cash and cash equivalents at
  beginning of period                                          247,452            553,236                     -
                                                          ------------         ----------    ------------------
Cash and cash equivalents at
  end of period                                          $     569,731        $   225,704          $    569,731
                                                         =============        ===========          ============
</TABLE>

<PAGE>



                         PART I - FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS LTD.

                               September 30, 1996

ITEM 1   -    Financial Statements

         The  information  for the three and nine month periods ended  September
30, 1996 and 1995 is  unaudited,  but includes  all  adjustments  which  Coastal
Caribbean Oils & Minerals,  Ltd. (the "Company")  considers necessary for a fair
statement  of the results of  operations  for those  periods.  The  consolidated
financial  statements  include the  Company's  63.4% owned  subsidiary,  Coastal
Petroleum Company ("Coastal Petroleum").

         The Company's  principal  assets are oil, gas, and mineral leases which
total $3.9 million at September 30, 1996.  The Company has been and continues to
be involved in several  proceedings  which have limited the Company's ability to
commence development activities on its unproved oil and gas properties or obtain
compensation  for certain  property  rights it believes  have been  confiscated.
These  consolidated  financial  statements  do not  include any  adjustments  to
reflect the possible future effects on the  recoverability and classification of
assets or amounts and  classification  of  liabilities  that may result from the
outcome of this uncertainty.

ITEM 2   -    Management's Discussion and Analysis of Financial Condition and
              Results of Operation

Liquidity and Capital Resources

                              Short Term Liquidity

         At  September  30,  1996,  Coastal  Caribbean  had  working  capital of
approximately  $6.1  million.  These  funds are  expected to be used for general
corporate  purposes,  including  exploration and development and to continue the
litigation against the State of Florida.

         On May 29, 1996,  the Company  concluded its offering of  approximately
6.7 million  shares to its  shareholders  at $1.00 per share.  The  offering was
oversubscribed  and the proceeds to the Company were  approximately $6.4 million
after the expenses of the offering.



<PAGE>


                         PART I - FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS LTD.

                               September 30, 1996

ITEM 2   -    Management's Discussion and Analysis of Financial Condition and
                  Results of Operation (Cont'd)

                               Long Term Liquidity

         The Company estimates that as much as $400,000 per year may be required
in connection with the Florida litigation.  The Company expects that the Florida
litigation  could  continue at least through  1998,  although the State may take
actions that could shorten or lengthen that period. The Company has a program to
evaluate  the  Company's  leases which is  estimated  to cost  approximately  $2
million and is subject to the outcome of the Florida  litigation.  At  September
30,  1996,  the  Company  has spent  approximately  $200,000  under a program to
upgrade the leases.

         The  Company's  oil and  gas  properties  are  currently  unproved  and
undeveloped.  The Company  has  applied for a drilling  permit from the State of
Florida to drill an exploratory  well in the water near  Apalachicola,  Florida.
The State of Florida has  resisted  the  issuance of a drilling  permit.  If the
Company is successful  in obtaining a state  drilling  permit,  then the Company
must also do the following:

         1.       Obtain a federal drilling permit.

         2.       Finance drilling of the well, which is estimated to cost
                  between $10-15 million.

         3.       Begin drilling the well within one year of the date the state
                  permit is issued.

         The Company does not  currently  have assets  sufficient  to fund these
expenditures  to drill the  exploration  well, if a permit were granted.  If oil
and/or gas is discovered in commercial  quantities,  a production  program would
require  additional  permitting  and  construction  of  production,  storage and
delivery  systems.  The  Company  may seek  additional  financing  to fund these
development expenditures.



<PAGE>


                         PART I - FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS LTD.

                               September 30, 1996

ITEM 2   -    Management's Discussion and Analysis of Financial Condition and
              Results of Operation (Cont'd)

Results of Operations

Three month period ended September 30, 1996 vs. September 30, 1995

     The  Company  incurred a loss of  $191,070  for the third  quarter of 1996,
compared to a loss of $190,638 for the comparable 1995 quarter.

     Interest  income and other income  increased from $3,389 in 1995 to $78,698
in 1996 due to the  funds  available  for  investment  from the May 1996  rights
offering to shareholders.

     Legal  fees and costs  increased  47 % to  $115,112  for the 1996  quarter,
compared to $78,069 in the prior  period.  These costs  increased due to (1) the
various  appeals filed in connection  with the State of Florida's  opposition to
the  issuance  of a  drilling  permit  and (2)  preparation  of an appeal of the
adverse  decision  that  there  has not been a taking of the  Company's  royalty
interests.

     Administrative  expenses increased 25% to $78,677 from $62,789. The primary
reason for the increase is the first time purchase of  Directors'  and Officers'
liability insurance.

     Shareholder  communications  increased  85% from  $11,647 to  $36,500.  The
increase represents the additional cost of press releases and mailings to report
the developments in the permit and royalty interest litigation

     Exploration  costs  increased from $2,022 to $17,955 in connection with the
Company's program to upgrade its unproved oil and gas properties.

Nine month period ended September 30, 1996 vs. September 30, 1995

     The Company incurred a loss of $685,884 for the nine months ended September
1996, compared to a loss of $668,908 for the 1995 period.

<PAGE>


                         PART I - FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS

                     COASTAL CARIBBEAN OILS & MINERALS LTD.

                               September 30, 1996

ITEM 2   -    Management's Discussion and Analysis of Financial Condition and
              Results of Operation (Cont'd)

     Interest income and other income increased from $12,081 in 1995 to $113,890
in 1996 due to the  funds  available  for  investment  from the May 1996  rights
offering to shareholders.

     Legal  fees and  costs  increased  40% to  $336,621  for the  1996  period,
compared to $241,215 in the prior period.  These costs  increased due to (1) the
various  appeals filed in connection  with the State of Florida's  opposition to
the  issuance  of a drilling  permit and (2) the May 6, 1996 trial to  determine
whether there has been a taking of the Company's royalty interests.

     Exploration  costs  increased  from $2,703 to $23,606 in 1996 in connection
with the Company's program to upgrade its unproved oil and gas properties.


<PAGE>


                         PART II - FINANCIAL INFORMATION

                     COASTAL CARIBBEAN OILS & MINERALS LTD.

                               September 30, 1996

Item 1.  Legal Proceedings.

         See Item 6 for a summary of legal proceedings during the period.

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

         (a) On August 1, 1996,  the Company filed a Current  Report on Form 8-K
to report that on July 30, 1996,  Florida  Supreme Court  declined to review the
First District Court of Appeal decision that overturned a State of Florida order
that  required a $1.9 billion  surety bond as a condition  for the issuance of a
drilling permit to Coastal Petroleum Company, a majority-owned subsidiary.

         (b) On August 6, 1996,  the Company filed a Current  Report on Form 8-K
to report  that  Florida's  Leon County  Circuit  Court  ruled  against  Coastal
Petroleum Company in its inverse condemnation case against the State of Florida.

         (c) On August 21, 1996,  the Company filed a Current Report on Form 8-K
to report  that on August 16,  1996,  the  Company  was  notified by the Florida
Department of Environmental  Protection  ("DEP") that the DEP was ready to issue
an offshore  drilling permit to Coastal  Petroleum  Company,  its majority owned
subsidiary.  The position of the DEP was that the permit issuance was subject to
publication of the DEP's Notice of Intent. The Company notified the DEP that the
Notice of Intent was not required by either law or regulation.

         (d) On September 3, 1996,  the Company  filed a Current  Report on Form
8-K that on August 27, 1996, the Company filed a petition with  Florida's  First
District  Court of Appeal  to order  the  state's  Department  of  Environmental
Protection to issue an offshore  drilling  permit to the Company without further
delay.

         (e) On September 17, 1996,  the Company filed a Current  Report on Form
8-K that  Florida's  First  District  Court of  Appeal  has  ordered  the  State
Department  of  Environmental  Protection  to  show  cause  why  it  should  not
immediately  issue an  offshore  drilling  permit to the  Company's  subsidiary,
Coastal Petroleum Company.




<PAGE>




                                   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.




                                    COASTAL CARIBBEAN OILS & MINERALS, LTD.
                                                  Registrant




Date:  October 23,1996              By  /s/ James R. Joyce
                                        James R. Joyce
                                        Treasurer and Chief Accounting and
                                        Financial Officer




<PAGE>