U.S. SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C. 20549

                               Form 10-QSB

(Mark One)

X : Quarterly report under section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended July 31, 1997.

__: Transition report under section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required] for the transition period
from _________ to _________.

Commission File No:   0-25798

                          HERITAGE MINES, LTD.
                 (Name of small business in its charter)

Colorado                          84-1293168
(State or other              (IRS Employer ID.  No.)
jurisdiction of Incorporation)

1199 Main Avenue, Ste. 221
Durango, Colorado
                                            81301
(Address of Principal Office)                  Zip Code

Issuer's telephone number:    (970) 385-0374

Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities 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. Yes _X__   No ____

Applicable only to issuers involved in bankruptcy proceedings during
the past five years

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

Applicable only to corporate issuers

State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.   6,487,172.

Transitional Small Business Disclosure
Format (Check one):
Yes ____  No   X  <PAGE>
PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS AND EXHIBITS

       (b)  Financial statements for Heritage Mines, Ltd. as and for
the quarter ending July 31, 1997, and the comparable period of the
preceding fiscal year.

FINANCIAL STATEMENTS
(A Development Stage Company)

HERITAGE MINES, LTD.


Quarter ended July 31, 1997<PAGE>

HERITAGE MINES, LTD.
(A Development Stage Company)



Consolidated Balance Sheet
Consolidated Statement of Operations
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
<PAGE>
HERITAGE MINES, LTD.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEET
(Unaudited)

<TABLE>
<CAPTION>
                                     July 31,              July 30,
                                     1997                  1996
<S>                                      <C>                   <C>

                                      ASSETS

CURRENT ASSETS
Cash and cash equivalents            155,392               182,430
Other current assets                  26,403                12,466
  Total Current Assets               181,795               194,896

PROPERTY, PLANT,
 EQUIPMENT AND MINE
 DEVELOPMENT COSTS,
 NET                               2,064,635             1,447,550

OTHER ASSETS
Other Assets                          62,548                60,338
  Total other assets                  62,548                60,338

  Total Assets                     2,308,979             1,702,784

                       LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
Accounts payable                     252,446                   339
Accrued liabilities                  233,252                23,944
Notes payable                        860,626                86,640
Notes and advances to
 stockholders and
 related parties                      74,700                     0
Accrued interest                      58,371                 9,777
Total current liabilities          1,479,395               120,700

STOCKHOLDERS' EQUITY
 (DEFICIT)
Common Stock                         126,205               771,639
Additional paid-in
 capital                           2,883,182             1,914,913
Deficit accumulated
 during the
 development stage               (2,159,803)           (1,104,468)

TOTAL STOCKHOLDERS'
 EQUITY (DEFICIT)                    829,584             1,582,084

TOTAL LIABILITIES
 AND STOCKHOLDERS'
 EQUITY (DEFICIT)                  2,308,979             1,702,784
</TABLE>
<PAGE>
HERITAGE MINES, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>


                         Three Months   Three Months
                                Ended          Ended
                              July 31        July 31
                                 1997           1996
<S>                               <C>            <C>
REVENUES
Operating Revenue                   0              0
  Total Revenues                    0              0

OPERATING COSTS
General and
 Administrative               203,916        326,009
Depreciation                   13,097         18,602
  Total operating
  costs                       217,013        344,611

  Loss from
  Operations                (217,013)      (344,611)

OTHER INCOME (EXPENSE)
Interest expense, net        (18,075)        (2,005)
Other Expense                       0              0
  Total Other Income
  (Expense)                  (18,075)        (2,005)

NET LOSS                    (235,088)      (346,616)

NET LOSS
PER SHARE                          (0.02)         (0.03)

WEIGHTED
 AVERAGE
 COMMON
 SHARES                     6,487,172     10,195,417
</TABLE>
<PAGE>
HERITAGE MINES, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>


                           Six Months     Six Months
                                Ended          Ended
                              July 31        July 31
                                 1997           1996
<S>                               <C>            <C>
REVENUES
Operating Revenue               3,536              0
  Total Revenues                3,536              0

OPERATING COSTS
General and
 Administrative               409,282        629,079
Depreciation                   30,424         30,638
  Total operating
  costs                       439,706        659,717

  Loss from
  Operations                (436,170)      (659,717)

OTHER INCOME (EXPENSE)
Interest expense, net        (35,520)       (10,555)
Other Expense                       0      (125,000)
  Total Other Income
  (Expense)                  (35,520)      (135,555)

NET LOSS                    (471,690)      (795,272)

NET LOSS
PER SHARE                          (0.07)         (0.08)

WEIGHTED
 AVERAGE
 COMMON
 SHARES                     6,487,172     10,265,000
</TABLE>
<PAGE>
HERITAGE MINES, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>

                           Six Months     Six Months
                                Ended          Ended
                              July 31        July 31
                                 1997           1996
<S>                               <C>            <C>

CASH FLOWS FROM
 OPERATING 
 ACTIVITIES:

Net Loss                    (471,690)       (795,272)

Adjustments to reconcile net loss to cash used
 in operating activities:

  Depreciation                 30,424         30,638
  Stock issued
    for services
  Stockholders' compensation
    contributed to
    capital

Changes in assets and liabilities

  Other current assets       (18,149)         11,135
  Other assets                (2,210)              0
  Accounts payable             97,846            339
  Accrued liabilities         100,066        124,923
  Accrued interest             34,076          9,614

Net cash and cash equivalents provided (used) by
operating activities        (229,637)      (618,423)

CASH FLOWS FROM
 INVESTING
 ACTIVITIES:

 Purchase of property
 and equipment                      0       (88,701)
 Mine development
 costs                       (24,486)      (317,061)
 Construction in
 progress                     (9,034)       (46,376)
 Deposits                                      3,000
 Mining Claims

Net cash and cash equivalents provided (used) by
investing activities         (33,520)      (449,138)

CASH FLOWS FROM
 FINANCING
 ACTIVITIES:

 Issuance of common
 stock for cash               125,000        550,125
 Proceeds from notes
 payable to related
 parties                                     676,323
 Proceeds from notes
 payable                      294,700
 Advances from
 related parties
Repayment of notes
 payable                      (2,229)

Net cash and cash equivalents provided (used) by
 financing activities         417,471      1,226,448

NET INCREASE
 (DECREASE) IN 
 CASH AND CASH 
 EQUIVALENTS                  154,314        158,887

CASH AND CASH
 EQUIVALENTS,
 BEGINNING OF
 YEAR                           1,078         23,543

CASH AND CASH
 EQUIVALENTS,
 END OF YEAR                  155,392        182,430
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS:

1.     ORGANIZATION AND DESCRIPTION OF BUSINESS

HERITAGE MINES, LTD.
Heritage Mines, Ltd., formerly known as Alchemy Equities, Ltd.
("the Company" or "Heritage") was incorporated under the laws of
the State of Colorado on January 19, 1995.  On March 6, 1996,
Heritage Mines, Ltd. acquired all the outstanding shares of Heritage
Gold Mines, Inc.  Since Heritage Mines, Ltd. was a non-operating
shell, and considering that the former stockholders of Heritage Gold
Mines, Inc. control Heritage Mines, Ltd. after the acquisition, this
business combination was accounted for as a reverse acquisition.

Prior to its merger with Heritage Gold Mines, Inc., Heritage Mines,
Ltd. had no full time employees, owned no real property and was
formed for the purpose of seeking out business opportunities.  Under
the purchase method, the $125,000 goodwill generated by the alloca-
tion of the purchase price (mainly acquisition expenses) was complete-
ly amortized and is included in general and administrative expenses.

HERITAGE GOLD MINES, INC.
WAZCO, Inc. ("WAZCO"), GWZ Management Company, Inc.
("GWZ"), and Heritage Gold Mines, Inc. ("Heritage Gold Mines") (A
Development Stage Company) were incorporated on May 14, 1992,
April 26, 1993, and July 21, 1995, respectively, under the laws of the
State of Nevada.

In connection with the merger with Heritage Mines, Ltd., Heritage
Gold Mines acquired 100% of the stock of WAZCO and GWZ from
the common stockholders, and several notes payable to stockholders
and related parties were contributed to capital (the "Reorganization")
(Note 6).  The exchange of shares between the companies under
common control was accounted for as if the combination was a pool-
ing of interest.

DESCRIPTION OF BUSINESS

The Company is developing the business to mine, mill and refine gold
ore from its own claims and deposits for sale as 80% fine dore gold
bars and 99.99% pure gold bullion.

Once in production, the 80% fine dore gold bars will be recovered
and refined by the Company from its own free gold on site.  The
concentrates, after the free gold and the Company production of 80%
fine dore gold bars, will be further refined under contract with outside
independent processors and refiners into 99.99% pure gold bullion
bars, which will then be sold by the Company through recognized
outlets into the readily available domestic and international gold
market.

DEVELOPMENT STAGE

From its inception (considered to be May 14, 1992 for the purpose of
these consolidated financial statements), to July 31, 1997, the Com-
pany was in the development stage.  The Company has concentrated
its activities to acquire, explore, claim and permit mineral properties,
acquire, repair, retrofit and bring mining equipment to its intended
use, develop the mineral properties to get them ready for operations
and to raise capital to finance the activities described above.  From
inception through July 31, 1997, there have been no active mining
operations, although small test runs generated minimal revenues at the
end of the 1997 fiscal year.

GOING CONCERN

The Company has incurred operating losses from inception through
July 31, 1997, has an accumulated deficit of $2,159,803, and negative
working capital of $1,297,600.  During the six months ended July 31,
1997, the Company's operations used $229,637 of cash, and the
Company used $33,520 of cash in investing activities.  The Compa-
ny's cash was provided from stock issuances and notes from related
parties and others.  Management expects that the Company's cash
expenditures for the fiscal year ended January 31, 1998, will not be
less than $1,000,000.  Larger expenditures may be incurred based on
the Company's development project opportunities, and available cash
resources from operating cash flow and/or from additional financing.

The Company is in the process of raising between $500,000 and
$1,000,000 through a private placement of convertible debt securities,
and as of July 27, 1997, a total of $540,000 of the debentures had
been sold.  Management believes that the funds raised will allow the
Company to start revenue generating operations during the current
fiscal year.  However, there can be no assurance such funds will be
raised or will be sufficient to support profitable operations and addi-
tional financing may be necessary.  No adjustments have been made
to the accompanying financial statements to provide for this uncertain-
ty.

2.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of Heritage
Mines, Ltd., and Heritage Gold Mines and its wholly owned subsid-
iaries, GWZ and WAZCO.  All significant intercompany balances and
transactions have been eliminated.  Subsequent to the end of the
second quarter, the Company sold or transferred all of its interest in
GWZ to one of its directors for $10.00 and other consideration,
including release and indemnification from all liabilities of GWZ other
than certain specified liabilities which were paid by the Company at
the time of transfer of its interest in GWZ.

MANAGEMENT'S ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabili-
ties and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expens-
es during the reporting period.  Actual results could differ from those
estimates.

CASH AND CASH EQUIVALENTS AND SUPPLEMENTAL
CASH FLOW INFORMATION

Cash and cash equivalents consist of all cash balances and highly
liquid investments with a maturity of three months or less.

Income taxes and interest paid for all periods presented was immateri-
al.

FAIR VALUE OF FINANCIAL STATEMENTS

The carrying value of financial instruments included in current assets
and liabilities approximates fair value because of the short maturity of
these items.  The carrying value of notes payable and long-term debt
approximates fair value since these instruments bear rates consistent
with current market interest rates.

INVENTORIES

Ore and in-process inventories and materials and supplies are stated at
the lower of average cost or net realizable value.  Precious metals are
stated at market value.  Since there were no active operations, there
was no such inventory at July 31, 1997.

PROPERTY, PLANT, EQUIPMENT AND MINE DEVELOPMENT
COSTS

Expenditures for new property, plant and equipment or expenditures
which extend the useful lives of existing property, plant and equip-
ment are capitalized and depreciated using the straight-line method at
rates sufficient to depreciate such costs over their estimated productive
lives, which range from five to ten years.

Mineral exploration costs are expensed as incurred.  When it has been
determined that a mineral property can be economically developed,
the costs incurred to develop such property, including the costs to
further delineate the ore body and remove overburden to initially
expose the ore body, are capitalized.  Such costs and estimated future
development costs will be amortized using a unit-of-production meth-
od over the estimated life of the ore body.  No amortization was
recorded for all years presented as there have been no active mining
operations from inception to July 31, 1997.

3.     PROPERTY, PLANT, EQUIPMENT AND MINE DEVEL-
OPMENT AND MINING CLAIMS.

The Company's facilities, deposits, and claims are located in the
Knownothing Creek Mining District at the Forks of Salmon in North-
ern California.  The Company pays annual fees of a nominal amount
to the Federal Bureau of Land Management for the rights to use such
land to develop and extract minerals.  At July 31, 1997, there are
thirty-one claims in various stages of exploration and development,
valued at cost of $35,000.

Mine development costs are capitalized to the extent they are recover-
able from future mining operations, assuming the Company will
continue as a going concern.  Such analysis of cost recovery is based
on estimated ore reserves that are considered to be economically
recoverable.  Because of the inherent uncertainties surrounding the
determination of such estimates, it is at least reasonably possible that
estimated reserves may change in the near future and, as a result, the
mine development costs may not be entirely recoverable.

Construction in progress consists of a mill and its ancillary facilities,
which are connected by Company-improved roads to various claims
and operational mining locations.  The mill operation includes crush-
ing, grinding, separation shaker screen and concentration equipment,
and a furnace house, saw mill house, and dynamite storage house.


ITEM 2 -  MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION

PLAN OF OPERATIONS.  The long-term goal of the Company is to
become a self-sustaining medium sized precious metals exploration
and mining Company with a solid foundation of credible reserves
which can be developed and produced at costs which are in the lowest
quartile of industry averages.  In order to work towards this goal, the
plan of operations of the Company for the next twelve months in-
cludes hiring experienced management personnel, completion of the
sale of the balance of its convertible debenture offering, acquisition of
interests in one or more additional mining properties, completion of a
secondary financing of between $5,000,000 and $10,000,000 to
provide funds needed for exploration and development of its proper-
ties, and reaching a sustaining level of cash flow from limited produc-
tion on one or more of its properties.  There is no assurance that the
Company will be able to complete any of the elements of its plan of
operations.
 
MANAGEMENT DISCUSSION AND ANALYSIS.  Effective May
1, 1997, the Company hired Timothy M. Sadler as its Vice President
of Operations.  Mr. Sadler is a Registered Professional Mining Engi-
neer, as well as a graduate geologist.  He has twenty five years of
progressive experience in the mining industry, with particular focus
on mineral project evaluation and development.  In the capacity of
Vice President Operations, he will be primarily responsible for explo-
ration, feasibility determination, and operation of the Company's
mineral properties.  

As of April 28, 1997 the Company commenced a private placement
offering of convertible debentures intended to raise between $500,000
and $1,000,000 of bridge financing.  As of July 31, a total of 
$540,000 in principal amount of 15% convertible debentures had been
sold and the Company was in the process of completing necessary
documentation in order to obtain the release of the offering proceeds
from escrow.  Although there is no assurance as to when or whether
the Company will sell the remaining balance of its debenture offering,
it is currently anticipated that the remaining balance of the offering
will likely be sold during the third quarter to fully subscribe the
offering.  The proceeds of this offering have been allocated to pay-
ment of all outstanding trade payables, providing cash resources
necessary to enable the Company to proceed with acquisition of
certain additional properties, and working capital needed to enable the
Company to hire additional key personnel, relocate its corporate
office, establish needed business systems, and generally prepare itself
for a secondary offering or other financing arrangements intended to
provide the funds needed to explore and develop the Bowerman
Project and any additional properties it may acquire.  Notwithstanding
the completion of the minimum level of its debenture offering, the
Company will be required to raise additional funds in the next twelve
months, and failure to complete additional financing as planned would
raise substantial doubt about the Company's ability to continue as a
going concern.

On or about May 31, 1997, the Company completed the repurchase of
a total of 4,034,896 shares of its common stock from a group of its
founding shareholders, thereby reducing the number of issued and
outstanding shares from 10,522,068 to 6,487,172.  The repurchase
was completed in exchange for issuance of conditional promissory
notes.  The notes are convertible at any time, at the option of the
Company into newly issued shares of common stock.  To the extent
not converted by the Company, the notes are payable at the rate of
$2.00 per share purchased for each 500,000 ounces of prov-
en/probable gold reserves discovered on the Bowerman Project within
a period of 5 years.  No payments are due under the notes unless a
minimum of 500,000 ounces of proven/probable gold reserves are
discovered on the Bowerman Project within 5 years from the date of
repurchase of the shares.
  
The purpose of the share roll-back plan was to reduce the number of
currently issued and outstanding shares of the Company in order to
enhance the value of shares acquired by new investors in the Compa-
ny.

The Company previously signed a letter of intent concerning acquisi-
tion of an interest in a property known as the Lelan-Dividend Project
located in Yavapai County, Arizona.  The Company was not able to
complete its debenture offering in time to meet initial funding require-
ments for acquisition of a joint venture interest in the Lelan-Dividend
Project prior to expiration of the letter of intent.  Now that minimum
subscription of the debenture offering has been reached, the Company
is preparing to go forward with its plans to acquire interests in the
Lelan-Dividend Project as well as two other properties which it
believes exhibit similar geologic potential.  As of September 15,
1997, the Company has executed no letters of intent or taken other
formal action with respect to such potential acquisitions.

While developing and effecting its redirection and recapitalization
plans, the Company suspended operations at its Bowerman Gold
Project located in Siskiyou County, California.  Planning and analysis
is now underway to investigate the potential for metallurgical circuit-
modifications in the plant and development of a pilot stoping area in
the mine which will allow for restarting production by the fourth
quarter of this year.

Completion of at least a portion of the contemplated equity financing
will be required to effect plans for acquisition of interests in additional
projects and to restart production at the Bowerman Project.  Prelimi-
nary discussions have been held with several investment banking gro-
ups to assist with the planned financing.  Management has targeted
completion of this financing, as well as achievement of listing on
additional exchange(s) by year end 1997 in its discussion with the
investment banking houses.

This report contains various forward-looking statements that are based
on the Company's beliefs as well as assumptions made by and infor-
mation currently available to the Company.  When used in this report,
the words "believe," "expect," "anticipate," estimate and similar
expressions are intended to identify forward-looking statements.  Such
statements may include statements regarding reserves, resources,
mineralized material or deposits, mining methods, political and related
matters, planned levels of exploration, and the like, and are subject to
certain risks, uncertainties and assumptions which could cause actual
results to differ materially from projections or estimates contained
herein.  Factors which could cause actual results to differ materially
include, among others, unanticipated grade, geological, metallurgical,
processing or other problems, conclusions of feasibility studies,
changes in project parameters as plans continue to be refined, the
timing of receipt of governmental permits, results of current or
planned exploration activities, environmental costs and risks, changes
in the gold price, and the like.  Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those anticipated,
estimated or projected.  The Company cautions against placing undue
reliance on forward-looking statements all of which speak only as of
the date made.

ITEM 6 (a) -  Exhibit 27: Financial Data Schedule

       (b) -  There have been no reports on Form 8-K for the quarter
ending July 31, 1997.<PAGE>
Signatures

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

Heritage Mines, Ltd.
(Registrant)

By:/s/ ____________________________________
       Gregory B. Sparks
       President, CEO and Director

Date: September 15, 1997