UNITED  STATES
                        SECURITIES  AND  EXCHANGE  COMMISSION
                             WASHINGTON,  D.C.  20549
                                   FORM  10-KSB
<TABLE>
<CAPTION>
<S><C>
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
    ACT OF 1934 [FEE REQUIRED]
    For the fiscal year ended December 31, 1996

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES 
    EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
    For the transition period from ________ to ________ .

                         Commission File Number 1-6336
                           PETROMINERALS CORPORATION
                    (Name of small business issuer in its charter)
                     Delaware                          95-2573652
----------------------------------------------------------------------------- 
(State or other jurisdiction              (I.R.S. Employer Identification No.)
 of incorporation or arganization

                915 WESTMINSTER AVENUE, ALHAMBRA, CALIFORNIA 91803
------------------------------------------------------------------------------ 
                     (Address of principal executive offices)
                    Issuer's telephone number: (818) 284-8842

Securities registered pursuant to Section 12(b) of the Act:  NONE

Securities registered pursuant to Section 12(G) of the Act:

                          COMMON STOCK, PAR VALUE $.10
-----------------------------------------------------------------------------  
                              (Title of Class)
</TABLE>


Check whether the Issuer (1) 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  Issuer was required to file such reports), and (2) has been
subject  to  such  filing  requirements  for  the  past  90  days.
[X]  yes          [ ]   no

Check  if  there is no disclosure of delinquent filers in response to Item 405
of  Registration  S-B  is  not  contained  in  this  form and no disclosure be
contained,  to  the  best  of  Registrant's  knowledge, in definitive proxy or
information  statements  incorporated  by  reference  in Part III of this Form
10-KSB  or  any  amendment  to  this  Form  10-KSB. [X]

The  issuer's  revenues  for  its  most  recent  fiscal  year were $1,269,000.
                                                                   ----------

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

Transitional  small  business  disclosure  format.        [ ] yes      [X] no
The number of shares of Registrant's common stock outstanding was 8,475,336 as
of  February  21,  1997.
The  aggregate  market  value  of  the  Registrant's  voting  stock  held  by
non-affiliates  of  the Registrant was approximately $2,128,834 as of February
21,  1997.

The  total  number  of  pages  in  this  Form  10-KSB  are  63.
The  Index  of  Exhibits  included  in this Form 10-KSB is located at page 60.

<PAGE>
                           PETROMINERALS CORPORATION
                                    PART I

                               ITEM 1 - BUSINESS
                                        --------

A.    GENERAL  DESCRIPTION  OF  BUSINESS
      ----------------------------------

INTRODUCTION

Petrominerals  Corporation  (Petrominerals  or  the  Company)  which  was
incorporated  under  the  laws of the State of Delaware in 1966, is engaged in
the  production  of on-shore domestic crude oil and natural gas in Los Angeles
County, California, and oilfield services through its well servicing division,
Hydro-Test International, Inc. (Hydro-Test), which is currently doing business
as  Texas Tubing Testers. The Company's wholly owned subsidiary, Hydro-Test, a
New  Mexico  corporation   acquired in 1993, provides tubular testing services
including  hydro-static  testing  of tubing, pipelines and valve assemblies in
the  oil  and  gas industry, both on-shore and offshore. The Company sells the
oil  it produces at the well site and does not refine any of its production or
market  any  other  petroleum  products.

BUSINESS  STRATEGY

The  Company plans to continue operating its existing oil and gas wells in the
Santa  Clarita  Valley  and  maximizing cash flows from this operation. A well
stimulation  program  that  began in 1995 will continue to show its benefit in
the  current  year,  as  management  continues efforts to maximize efficiency.
Additionally, a new well was drilled by Petrominerals 96-1, which is a related
party  limited  partnership. This new well was completed on December 20, 1996,
and  began  production  on  January  20,  1997.  The Company also continues to
evaluate  purchase  or  merger  offers.

DISPOSITION  AND  BANKRUPTCY  OF  HYDRO-TEST  INTERNATIONAL,  INC.

In  March  1995, the Company adopted a formal plan to liquidate and dispose of
the  assets  of Hydro-Test, due to a downturn in the oilfield service industry
in the first quarter of 1995.  Through August 1995, the Company proceeded with
this  liquidation  plan  by  selling  the  equipment  and inventory of several
locations  operated  by Hydro-Test. On September 1, 1995, management abandoned
the  liquidation plan and commenced its voluntary reorganization case with the
filing  of  a  petition under Chapter 11 of the United States Bankruptcy Code.
This case was filed as a Chapter 11 case to protect the Hydro-Test assets from
seizure  and to pay creditor claims in a greater amount than could be obtained
in  an  immediate  Chapter  7  liquidation  case.


<PAGE>
ITEM  1  -  BUSINESS  (Continued)
            --------

A.    GENERAL  DESCRIPTION  OF  BUSINESS  (Continued)
      ----------------------------------

DISPOSITION  AND  BANKRUPTCY  OF  HYDRO-TEST  INTERNATIONAL,  INC. (Continued)

On  May 16, 1996, the plan of reorganization was accepted by the creditors and
confirmed  by the United States Bankruptcy Courts for the Southern District of
Texas,  Houston  Division.  On  August 14, 1996, a final hearing took place to
approve  the  payment  of  professional fees and order final payment. As such,
Hydro-Test  is  no  longer  in  bankruptcy.

All  of  the  creditors  that  had the option, elected to receive 50% of their
claim over 60 months rather than 25% over 90 days. Hydro-Test has not yet paid
any  of  these  claims.  Management  will  review  the  financial condition of
Hydro-Test on the first anniversary of the plan and determine when payments to
creditors  will  be  made.

REAL  PROPERTY  HOLDINGS

The  Company  owns  140  acres  of unimproved land in the Hasley Canyon field,
Santa  Clarita  Valley, Los Angeles County, California, which is the Company's
primary  location  of  oil  production.  Six of the Company's wells and a tank
battery  are located on land owned by the Company, and the remaining wells are
located  on  leased  property.

The  Company  entered  into  a  lease and option to purchase agreement with an
unrelated entity effective December 30, 1996, in an effort to raise additional
capital  by  selling most of the 140 acres mentioned above. Under the terms of
the  agreement,  the lessee has an option to purchase the property at any time
during a ten year period. The lessee is required to make various monthly lease
payments  and  can  withdraw  from  the  lease  at  any  time.

In  January  1995,  the  Company  sold  29  acres  of real property located in
Bakersfield, Kern County, California, for total consideration of $850,000. The
purchaser  paid  $350,000  in cash and the balance of $500,000 is secured by a
Promissory  Note and First Deed of Trust payable monthly for a term of fifteen
years,  with  a balloon payment due in eight years. The Note bears interest at
the  rate  of  8.5  percent  per  annum.

In  May  1995,  the  Company  sold  its  interest in the Pointe Coupee Parish,
Louisiana,  oilfields  for $155,000 in cash.  In August 1995, the Company sold
its  oil  and gas interests in the Santa Barbara County, California, oilfields
for $150,000 in cash. Both properties were sold to separate unrelated parties.


<PAGE>
ITEM  1  -  BUSINESS  (Continued)
            --------

B.    FINANCIAL  INFORMATION  CONCERNING  INDUSTRY  SEGMENTS
      ------------------------------------------------------

Petrominerals  principally  operates  in  two industry segments: (1) providing
tubular  testing  and  complimentary  services  through  its oilfield services
subsidiary,  Hydro-Test; and (2) the production and sale of crude oil.  During
the  past  three  years,  revenues  were  derived  from  the oilfield services
operations  and the production and sale of produced crude oil and natural gas.
The  following table shows the Industry Segment Percentage Revenues derived by
Petrominerals  for  the  past  three  years:

Industry  Segment  Percentage  Revenues:
<TABLE>
<CAPTION>

                              Years  Ended  December  31,
                              ---------------------------

                          1996         1995         1994
                          ----         ----         ----    
<S>                    <C>   <C>    <C>   <C>    <C>   <C>

Oilfield services         1.0%        36.3%        76.3%
Oil and gas sales        94.0%        57.6%        22.9%
Other                     5.0%         6.1%          .8%
</TABLE>


See  Note  10  to  the  Consolidated Financial Statements in Item 7 hereof for
information  regarding  amount  of revenue, operating profit, and identifiable
assets  attributable  to Petrominerals' industry segments for the fiscal years
indicated  above.


C.    DESCRIPTION  OF  BUSINESS
      -------------------------

OILFIELD  SERVICES

Hydro-Test  operates  one  remaining  facility near Houston, Texas. Hydro-Test
previously  operated  two  offices  in California, three offices in Texas, one
office in New Mexico, and through its franchisees, licensed an additional four
offices  in  the  United  States  and  other  countries.  All  operations were
consolidated into the remaining Texas operation during 1995 in anticipation of
reorganization.  Hydro-Test  is engaged in the hydro-static testing of tubular
pipe,  pipelines  and  valve  assemblies  in  the  oil  and gas industry, both
on-shore  and  offshore.  Hydro-Test  has been in the tubular testing business
since  1945.

The  Company  closed its well servicing division, Lunn Production Service, due
to  the  loss  of the contract with Chevron, U.S.A., Inc. On July 6, 1994, the
Company auctioned Lunn's equipment and operating assets. The Company then sold
the  remaining property, 29 acres of real property in Bakersfield, California,
in  January  1995.


<PAGE>
ITEM  1  -  BUSINESS  (Continued)
            --------

C.    DESCRIPTION  OF  BUSINESS  (Continued)
      -------------------------

Major  Customers.  The loss of several customers in 1995 significantly reduced
----------------
Hydro-Test's revenues. Under current operating conditions, the loss of any one
customer  would not have a material adverse effect upon Hydro-Test's revenues.

OIL  AND  GAS  SALES

The  Company  currently  owns  and  operates  oil wells in Los Angeles County,
California.  Specifically,  the  Hasley  Canyon  and  Castaic Hills fields are
located  in  the  Santa Clarita Valley, Los Angeles County. The Company's Gato
Ridge  and  Hancock  fields,  located in the Santa Maria Valley, Santa Barbara
County,  California,  were  sold  in  August  1995.  The Company's oil and gas
interests  in  Pointe  Coupee  Parish,  Louisiana, were also sold in May 1995.

Development  of    Properties
-----------------------------

The  Company entered into a joint venture agreement with Petrominerals 96-1, a
limited  partnership  formed  on  December  3,  1996,  to  drill  a  well on a
designated  site.  The  Company  has  a  1% interest as general partner in the
partnership,  and  the  limited  partners  consist  of three directors and two
unrelated  parties.  The  Company  contributed  the drill site in exchange for
their  interest  in  the  partnership  and  serves  as  the  well's  operator.

Petrominerals  contracts  to  sell the oil it produces to customers who either
refine  the  oil  or resell it to refiners. The Company does not refine any of
its  oil  production  and  uses  all  of  the  gas produced to either generate
electricity  for  pumping units or to operate gas powered pumping units. Sales
of  produced  oil  are  generally  made pursuant to contracts of 30 or 90 days
duration  and  fluctuate  with differences in posted field prices based on the
quality  of the oil produced. The price obtained for oil depends upon numerous
factors,  including  the  extent  of  domestic production and foreign imports,
world  events,  market demand, hostilities in oil producing countries, and the
effect  of  governmental  regulations.  As  a result of a combination of these
factors,  oil prices are constantly fluctuating. Prices for California oil are
significantly  lower  than  reported  benchmark  prices for similar oil in the
United  States, due to the influx of Alaskan North Slope (ANS) crude into West
Coast  markets, which is directly in competition with California's production.
Congress  recently  lifted  the ban on the export of ANS crude which, combined
with  other  factors,  has  led  to  an  improvement  in  prices.


<PAGE>
ITEM  1  -  BUSINESS  (Continued)
            --------

C.    DESCRIPTION  OF  BUSINESS  (Continued)
      -------------------------

OIL  AND  GAS  SALES  (Continued)

Development  of    Properties  (Continued)
-----------------------------

The  average  price  the  Company  received  for its crude oil during 1996 was
approximately  $15.13  per  barrel,  which  is  approximately $3.00 per barrel
higher  than  the  average  price  which the Company received for its crude in
1995.  The  Company incurred average production costs of $9.04 per barrel, and
produced 106,456 barrels of crude. Revenues decreased as a result of decreased
production,  following  the  sale of the two properties noted above. The price
paid  per  barrel  of oil produced in the remaining fields increased, although
there  is  no  assurance that the Company will be able to continue to sell its
oil  production  at  favorable  prices.

Operating Hazards and Uninsured Risks. The Company's operations are subject to
-------------------------------------
all  of the operating hazards and risks associated with producing oil, such as
environmental  pollution  and  personal  injury.  The  Company carries general
liability  insurance,  however,  it  has  not  obtained  insurance  against
environmental  pollution  over  and  above the minimum amounts required by the
State  of  California.

Government  Regulations.  Federal, state and local governments impose numerous
-----------------------
laws  and  regulations on the production and sale of oil and gas. In addition,
state  and  Federal regulations have been adopted which pertain to the spacing
of  wells,  prevention  of waste of oil and gas, limiting rates of production,
proration  of  productions,  handling  of waste water and similar matters. All
such  laws  and regulations are subject to change at any time, and there is no
way  to  ascertain  either  the  likelihood or potential effect of such future
changes.

Major  Customers.  The Company sold approximately 98% of its oil production to
----------------
Texaco  Trading  and  Transportation,  Inc. (Texaco) during 1996. The contract
with  Texaco  is  for  the period September 1, 1995 through March 1, 1996, and
continues  month  to  month  thereafter until the first month following either
party's  sixty  day  advance  written  notice  of  termination.

Management  believes  that  the  loss of its contract with Texaco could have a
material  adverse  effect  on  Petrominerals,  in  the unlikely event that the
Company  were  unable  to  obtain  new  customers  which  were  sufficient
replacements.  See  Note  10  to  the  Financial Statements included in Item 7
hereof  which  contains  information  regarding  sales  to  major  customers.


<PAGE>
ITEM  1  -  BUSINESS  (Continued)
            --------

C.    DESCRIPTION  OF  BUSINESS  (Continued)
      -------------------------

OIL  AND  GAS  SALES  (Continued)

Development  of    Properties  (Continued)
-----------------------------

Petrominerals'  oil  and  gas segment faces competition from a large number of
companies  and  individuals  both foreign and domestic, who are engaged in the
production  of  oil  and  gas.  Most  of  the  Company's  competitors  have
substantially  more  technical  and financial resources available to them. The
Company  competes  on price only, and its ability to market its oil production
is  directly  affected by factors that are beyond the Company's control. These
factors  include  crude oil imports, actions by foreign oil producing nations,
the availability of adequate pipeline and other transportation facilities, the
availability  of  equipment and personnel, marketing of competitive fuels, the
effect  of  governmental regulations, and the fluctuation of supply and demand
with  respect  to  oil  and  gas.

Environmental Matters. The Company has established procedures for the on-going
---------------------
evaluation of its operations to identify potential environmental exposures and
assure compliance with regulatory policies and procedures. Management monitors
these  laws  and  regulations  and  periodically assesses the propriety of its
operational  and  accounting  policies  related  to  environmental issues. The
nature  of  the Company's business requires routine day-to-day compliance with
environmental  laws  and  regulations.  Additionally,  the  Company  has  been
identified  as  a  potentially  responsible  party  (PRP) by the Environmental
Protection Agency (see Item 3). Management is unable to determine what effect,
if  any,  this  will  have  on  the  Company.

The  Company  is  unable  to  predict  whether  its  future operations will be
materially  affected  by  these  laws  and  regulations.  It  is believed that
legislation  and  regulations  relating  to  environmental protection will not
materially  affect  the  results  of  operations of the Company. Environmental
clean-up costs are incurred by the Company in the ordinary course of business.
In  1996  and  1995,  the  Company  incurred  approximately  $973  and  $0,
respectively,  in  environmental  investigation,  compliance  and  remediation
costs.

Employees.    As  of  March  26,  1996,  the  Company  employed  a total of 12
---------
individuals,  of  which  5  were  employed  by  Hydro-Test International, Inc.


<PAGE>
ITEM  2  -  PROPERTIES
            ----------

GENERAL

The  principal  properties  of  the  oil  and  gas  segment  consist of proved
developed  oil  and  gas  properties;  equipment  and  wells related to proved
properties;  proved  undeveloped  oil  and  gas properties; maps, geologic and
geophysical  records  related thereto; and real estate. The Company's interest
in  oil  and gas properties are principally in the form of direct and indirect
working  interests  in  leases.  The  Company  currently  holds  oil  and  gas
properties  located in Los Angeles County, California.  The Company previously
held  an  interest  in properties located in Santa Barbara County, California,
and  Pointe  Coupee  Parish,  Louisiana, however, these were sold in 1995. The
Company  does not sell the natural gas produced in their remaining fields, but
instead uses the gas to produce electricity for electric pumping units or uses
the  gas  to  operate  gas  powered  pumping  units.

OIL  AND  GAS  RESERVES  AND  PRODUCTION  INFORMATION

The  tables  located  in  Note 13 of Item 7 located elsewhere herein set forth
information  with  respect  to the engineering estimates of proved oil and gas
reserves  owned by the Company. The reserves are shown in barrels (Bbl) of oil
and thousands of cubic feet (Mcf) of gas. All of the proved reserves currently
being  produced and operated by the Company are located in Los Angeles County,
California.  Except  as  set forth in this report, Petrominerals has not filed
any  estimates  of proved reserves with any federal authority or agency during
the  last  fiscal  year.  The  Company's  net  interest in proved reserves and
related  valuations  for  the years ended December 31, 1996 and 1995 have been
prepared  by  Babson  & Sheppard, an independent petroleum engineering firm in
Long  Beach,  California.

Reserve  estimates are based upon detailed engineering and geological studies.
Where  an  adequate  production  trend  has been established, extrapolation of
production  performance  is  used.  If insufficient well data is available for
performance  calculations,  the  initial  gas  or  oil  in  place  volumes are
estimated from geological interpretation of reservoirs, analysis of production
from  wells  in  similar  surrounding  areas,  or  other techniques. Petroleum
engineering  is  not  an  exact  science, and it involves estimates based upon
numerous  factors,  many  of which are inherently variable and uncertain. Such
factors  include  the  price  of  oil  and  gas  and  estimates of oil and gas
production  and  costs.  Estimates  of  reserves  and future net revenue costs
involve  projecting  future  results  by  estimating future events. Therefore,
there  are no assurances that actual productions, revenues, taxes, development
expenditures  and  operating  expenses  will  occur  as  estimated.


<PAGE>
ITEM  2  -  PROPERTIES  (Continued)
            ----------

OIL  AND  GAS  RESERVES  AND  PRODUCTION  INFORMATION  (Continued)

Oil  and  Gas  Reserves  Information
------------------------------------

Information  regarding  the  Company's  estimated  net  oil  and gas reserves,
additions  and  revisions  to  estimated  net  reserves, estimated future cash
inflows  and  related costs and discounted future net cash flows for the years
ended  December  31,  1996 and 1995, are contained in Note 13 to the Company's
consolidated  financial  statements  in  Item  7 hereof. The Company's reserve
report,  from which the foregoing estimates were derived, is based upon prices
in  effect  at  December  31,  1996.

The  Company  periodically evaluates its oil and gas properties for impairment
by  determining  if  the  carrying value of the properties exceeds the present
value  of  their  estimated  future net revenues, calculated at current prices
(i.e.,  the ceiling). Since March 1986, the Company has established impairment
reserves  of  $10,963,000  against  its  oil  and  gas  properties,  of  which
$1,390,000 was recorded in 1993, due to the year-end average posting prices of
$7.05  per  barrel.  Current  accounting standards do not allow the Company to
reinstate  value  for  subsequent  increases  in  the  ceiling.

PRODUCTION

Net  Annual  Production
-----------------------

The  following  table  sets  forth the Company's net production of oil and gas
interests  for  the  periods  indicated.  Net production represents production
owned  by  Petrominerals  and produced to its interest, less royalty and other
similar  interests.
<TABLE>
<CAPTION>


                               Years Ended
                               December 31,
                               ------------
                        1996                      1995
                        ----                      ----
<S>                     <C>   <C>             <C>
                               (in thousands)
Net annual production
  Oil (Bbl)              106                       126
  Gas (Mcf)                -                        56
</TABLE>



<PAGE>
ITEM  2  -  PROPERTIES  (Continued)
            ----------

PRODUCTION  (Continued)

Sales  Prices  and  Production  Costs
-------------------------------------

The  following table sets forth the average sales price and average production
(lifting) cost per unit of oil and gas produced by the Company for the periods
indicated:
<TABLE>
<CAPTION>

                                         Years  Ended
                                         December  31,
                                          -----------

                                         1996     1995
                                       -------   ------
<S>                                    <C>       <C>

Average sales price
  Oil (per Bbl)                        $  15.13  $12.13
  Gas (per Mcf)                               -    1.14
Average production cost per barrel(1)   (2)9.04    7.61
<FN>

(1)         Natural gas production is converted into its oil barrel equivalent
based  on  the relative energy content of each. Petrominerals sells the oil it
produces  at  the  well  site  and  does  not  refine  any  of its production.

(2)      Petrominerals expensed the cost of deferred remedial work as incurred
during  1996, which increased production costs above historical levels. During
the three month period ended January 31, 1997, production costs averaged $6.65
per  barrel.
</TABLE>


PRODUCTIVE  WELLS  AND  DEVELOPED  ACREAGE

Proved  developed  oil  and  gas properties are properties on which wells have
been  drilled,  and  are  capable  of  producing  crude  oil or natural gas in
commercial  quantities.  The  Company's  proved  acreage  and  the  number  of
productive  wells  as of December 31, 1996, are set forth in the tables below:

Productive  Wells
-----------------

The  productive  wells  in  which the Company owned interests consisted of the
following:
<TABLE>
<CAPTION>
                        Productive  Wells(1)(2)(3)
                        --------------------------
                                   Oil
                                   ---

                          Gross Wells  Net Wells
                          -----------  ---------
                         <S>          <C>

                           36                  28
<FN>

(1)     "Gross  Wells"  represents  the  total  number  of wells in which
Petrominerals  has  a  working  interest; "Net Wells" represents the number of
gross  wells, multiplied by the percentage of the working or royalty interests
therein  owned  by  the  Company.
(2)     A productive well is a producing well or a well capable of production.
(3)     None  of  the oil or natural gas wells in which Petrominerals has
working  interests  have  multiple  completions  in  the  same  bore  hole.
</TABLE>



<PAGE>
ITEM  2  -  PROPERTIES  (Continued)
            ----------

PRODUCTIVE  WELLS  AND  DEVELOPED  ACREAGE  (Continued)

Developed  Acreage
------------------

The  Company's  working and royalty interests in developed acreage consists of
the  following:
<TABLE>
<CAPTION>

                      Developed  Acres(1)
                      -------------------

                      Gross         Net
                      -----         ---   
<S>               <C>    <C>    <C>  <C>

Total Acreage         1,200       968
<FN>

(1)    "Developed  Acres"  are  defined as acres spaced or assignable to
productive  wells.  "Gross  Acres" represents all developed acres in which the
Company  has  a  working interest; "Net Acres" represents the aggregate of the
working  interests  of  the  Company  in  the  gross  developed  acres.
</TABLE>


Drilling  Activity
------------------

The  Company entered into a joint venture during 1996 with Petrominerals 96-1,
a newly formed, limited partnership, to drill a well on a designated site in a
proven  area.  Under  the  terms of the agreement, the Company contributed the
drill site in exchange for a 1% interest in the partnership. Proceeds from the
working  interest  will  pay  at the rate of 10% to the Company and 90% to the
partnership  until  payout  occurs. Following payout, when the partnership has
recovered  their  initial  contribution,  the  Company will receive 70% of the
proceeds  and  the  partnership  will receive 30%. Payout is expected to occur
early  in  1999.  No  other  drilling  projects  are  currently  planned.

Delivery  Commitments
---------------------

The  Company  is not obligated to provide a fixed and determinable quantity of
oil  and  gas  in  the future under existing contracts or agreements, however,
they  do  have  an  agreement  to  sell  the  oil  produced.


<PAGE>
ITEM  3  -  LEGAL  PROCEEDINGS
            ------------------

The  Company is not a party to nor is its property the subject of any material
legal  proceedings  other  than  ordinary routine litigation incidental to its
business,  or  which  is  covered  by  insurance,  except  as set forth below.

In  December 1989, the Company was notified by the United States Environmental
Protection  Agency  (EPA)  that,  under  the  provisions  of the Comprehensive
Environmental  Response,  Compensation and Liability Act of 1980 (CERCLA), the
Company  was  considered a potentially responsible party (PRP) in the clean-up
of  the  Operating  Industries,  Inc.  (OII)  waste  disposal  site located in
Monterey  Park,  California.  Century  Oil  Corporation,  a predecessor of the
Company,  disposed  of  drilling  mud  and  water at the OII disposal site, at
various times from 1975 to 1977. The Company, along with several other similar
PRP's,   contend that drilling mud and waste water do not constitute hazardous
substances  within  the meaning of CERCLA. Although the ultimate impact of the
resolution  of  this  contingency  is  unknown,  management believes that this
matter  will  not  have a material adverse affect on the financial position of
the  Company.

On September 1, 1995, the Company's subsidiary, Hydro-Test International, Inc.
(Hydro-Test),  filed  a  petition  under  Chapter  11  of  the  United  States
Bankruptcy  Code.    This  case  was filed as a Chapter 11 case to protect the
assets  from  seizure  and  pay creditor claims a greater amount than could be
obtained  in  an immediate Chapter 7 liquidation case.  The case was presented
before the United States Bankruptcy Courts for the Southern District of Texas,
Houston Division.  Under the plan, creditors had the option of receiving a 25%
cash  payment of allowed claims within 90 days of the effective date or 50% of
allowed  claims  over  a  period of 60 months, with the exception of unsecured
creditors  with claims in excess of $5,001. Creditors with claims in excess of
$5,001 will receive payments over 84 months. The parent Company also agreed to
pay $50,000 in cash for equipment repair and convert $500,000 of its unsecured
debt  to  equity  at  the  rate  of $100,000 per year for five years and defer
participation  in cash distribution for 24 months. The new value of the parent
company's  contribution  was  computed  at  $300,000.

On  May 16, 1996, the plan of reorganization was accepted by the creditors and
confirmed  by the United States Bankruptcy Courts for the Southern District of
Texas,  Houston  Division.  On  August 14, 1996, a final hearing took place to
approve  the  payment  of  professional  fees and order final payment as such.
Hydro-Test  is  no  longer  in  bankruptcy.

All of the creditors that had the option elected to receive 50% of their claim
over  60 months rather than 25% over 90 days. The Company has not yet paid any
of  these  claims.


ITEM  4  -  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
            -----------------------------------------------------------

During  the  fourth  quarter  of  1996,  no  matter was submitted to a vote of
security  holders  through  the  solicitation  of  proxies  or  otherwise.


<PAGE>
                                    PART II


ITEM  5  -  MARKET  FOR  THE  REGISTRANT'S  COMMON  STOCK  AND
            --------------------------------------------------
             RELATED  SECURITY  HOLDER  MATTERS
             ----------------------------------

The  Company's  common stock is currently traded in the Small Cap System under
the   nasdaq symbol PTRO. The following table sets forth the range of high and
low  sales  prices  on  the  nasdaq  Small Cap System for the Company's common
stock,  for  the  fiscal  quarters  indicated:
<TABLE>
<CAPTION>

                    Bid  Prices
                    Fiscal  Years  Ended
                    December  31,
                    -------------

                   High    Low
                  ------  ------
<S>               <C>     <C>

1995
  First quarter   $11/32  $11/32
  Second quarter     3/8     1/9
  Third quarter     5/16    5/32
  Fourth quarter    3/16    5/32

1996
  First quarter   $  3/8     1/4
  Second quarter     3/8   11/32
  Third quarter      3/8    9/32
  Fourth quarter    5/16     1/4
</TABLE>


The  Company has 896 shareholders of record of its common stock as of February
21,  1997.

No  regular  dividends for Petrominerals' stock have been declared since 1986.
The Board of Directors has no current intention to declare or pay dividends in
the  foreseeable  future.  The  Board  of  Directors  periodically reviews the
financial position of the Company and evaluates whether or not it will declare
dividends.


<PAGE>
ITEM  6  -  MANAGEMENT  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
            ----------------------------------------------------
             CONDITION  AND  RESULTS  OF  OPERATIONS
             ---------------------------------------

The  following  discussion  should assist in an understanding of the Company's
financial  position and results of operations for each of the two years in the
period ended December 31, 1996. The Notes to Consolidated Financial Statements
as  of  December  31,  1996,  included  elsewhere  herein,  contain  detailed
information  that  should  be referred to in conjunction with this discussion.

BUSINESS  REVIEW

General
-------

The  current President and CEO of the Company served his first full term since
returning  during  1996.  He continued his original goals of cutting corporate
overhead  and  disposing  of  unproductive  assets.

Oil  and  Gas  Segment
----------------------

The  Company's  oil  revenues  are  impacted  by several factors, however, the
prevailing  factor  is the price of crude oil paid by the purchaser that holds
their  contract. This prevailing price is consistent with prices paid by other
local  purchasers. The price of oil has declined somewhat during the first two
months  of  1997,  but  management  feels  that conditions will continue to be
favorable  throughout  the  new  year.

The  Company's  oil  revenues  were  extremely volatile between 1990 and 1994,
however,  the  average  price  per  barrel  of  oil  sold  has  increased  by
approximately $5.40 per barrel over the last two years. As such, the Company's
remaining  properties have become more profitable and management found that it
was  feasible  to  drill  a  new  well  in  an  existing  field.

The  Company entered into a joint venture agreement with Petrominerals 96-1, a
limited  partnership  formed  on  December  3,  1996,  to  drill a well on the
Company's  Mabel  Strawn  oil  lease.  The Company assigned the drill site and
casing  required  for  the  well to the joint venture, and leased to the joint
venture  the  tangible  equipment  necessary  for  the  well.  The  Company is
reviewing  the  prospects  for drilling other wells in the area, but currently
does  not  have  any  other  plans  in  place. The new well began producing on
January  20,  1997,  and  will  most  likely  have a positive impact on future
profits.


<PAGE>
ITEM  6  -  MANAGEMENT  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
            ----------------------------------------------------
             CONDITION  AND  RESULTS  OF  OPERATIONS  (Continued)
             ---------------------------------------

BUSINESS  REVIEW  (Continued)

Oil  and  Gas  Segment  (Continued)
----------------------

The  Company  also  entered  into a lease with an option to purchase agreement
with a real estate developer in an effort to dispose of the Company's 140 acre
parcel  adjacent  to  their  oil  lease.  The  Company has received an initial
$10,000 payment, and the developer has opened an escrow account with $100,000.
The  Company  hopes to either utilize the developer's lease payments to expand
existing  operations  or use the proceeds from the sale for future expansions.
The  purchase  options under this agreement significantly exceed the Company's
$1.1  million  book  value  of  the  property.

Oilfield  Services  Segment
---------------------------

The Company's wholly owned subsidiary, Hydro-Test International, Inc., emerged
from  Chapter 11 bankruptcy on May 16, 1996, after their plan was confirmed by
the courts and accepted by the creditors. Management has continued to sell off
its  remaining assets and operates the remaining facility near Houston, Texas,
on  a  limited  basis.  There are no current plans to expand the operations or
provide  additional  capital  from  the  parent  company.

Under  the  terms  of  the  reorganization plan, creditors will receive 50% of
their  allowed  claim  over  a  24  month  period  from  the date the plan was
accepted.  No  distributions have currently been made to the creditors, and it
is questionable whether current operations will create the cash flow necessary
to  meet  these  obligations.  The  parent company has agreed to forgive their
intercompany  loan  in  exchange  for  $300,000 in new equity over a five year
period.  The  existing  shares  have not yet been cancelled, and no new shares
have  been  issued.

1996  COMPARED  WITH  1995

The  Company had cash provided by operations of approximately $316,000 for the
year  ended  December  31,  1996,  compared  to  cash  used  by  operations of
approximately  $183,000 for the year ended December 31, 1995.  The increase in
cash  flow  was  primarily  due  to the restructuring of Hydro-Test's debt and
increased  oil  prices.


<PAGE>
ITEM  6  -  MANAGEMENT  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
            ----------------------------------------------------
             CONDITION  AND  RESULTS  OF  OPERATIONS  (Continued)
             ---------------------------------------

BUSINESS  REVIEW  (Continued)

1996  COMPARED  WITH  1995  (Continued)

The  Company  is not currently servicing Hydro-Test's prepetition liabilities,
following  the  protection  that  the  Company  received from creditors during
Chapter  11 reorganization. If the Company does elect to begin making payments
in 1997, future cash flows will be negatively impacted. The Company would most
likely have to continue selling assets to service this debt, as it is unlikely
that  Hydro-Test  will  provide  enough  cash  from continuing operations. The
Company  received  approximately  $66,000 from the sale of Hydro-Test's assets
and  an  additional  $135,000  from  the sale of Hydro-Test's inventory during
1996.

The  Company  had  net  income  of  $376,000 in 1996 compared to a net loss of
$1,655,000  in  1995.  The  primary reason for the Company's net income in the
current  year was a one-time extraordinary gain on debt forgiven in bankruptcy
of  $448,000.  The Company incurred a loss before income tax and extraordinary
item  of  $72,000  in  1996.

Oilfield  service  revenues declined an additional 98% during 1996, due to the
further  downsizing  of  Hydro-Test.

Expenses  related  to  the  oilfield  service  sector  declined  85%, however,
expenses  continue  to  far  exceed  revenues  in this segment. The Company is
currently  working  to  further  reduce  expenses  and generate more revenues.

Depreciation,  depletion  and  amortization expense decreased by approximately
35%  due  to  the continued disposal of Hydro-Test's fixed assets during 1996.
Depreciation, depletion and amortization was 9% and 6% of fixed assets in 1996
and  1995,  respectively.

General and administrative expense decreased by approximately 25%, as a result
of  the  continued cost cutting by the returning President and CEO. Management
expects  this  trend  to  continue  in  1997.

The  95% decrease in interest expense and prior year $805,000 loss on disposal
of  assets were both directly related to the Hydro-Test Chapter 11 bankruptcy.
The  Company  is  currently  not  recording  interest  on  the  prepetition
liabilities,  and  the loss on disposal of assets was a one-time write down to
reflect  the  assets'  net  realizable  value.


<PAGE>
ITEM  6  -  MANAGEMENT  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
            ----------------------------------------------------
             CONDITION  AND  RESULTS  OF  OPERATIONS  (Continued)
             ---------------------------------------

BUSINESS  REVIEW  (Continued)

1995  COMPARED  WITH  1994

The  Company had a cash loss from operations of approximately $183,000 for the
year  ended  December  31,  1995, compared to cash provided from operations of
approximately  $358,000 for 1994.  The decrease in cash flow was primarily the
result of a significant operating loss in the oilfield services segment during
1995,  as  the  result  of  the  liquidation  and  bankruptcy  of  Hydro-Test.

Capital expenditures in 1995 were $106,000, compared to $288,000 in 1994.  The
decrease  was  primarily  the  result  of  cash  flow problems due to the poor
financial  condition  of  the  Company's subsidiary. The Company was, however,
able to reduce its outstanding debt by approximately $615,000 during 1995, due
primarily  to  the  sale  of  the  Hydro-Test  assets  and  the  sale  of  the
Bakersfield,  California,  property  held  for  sale  at  December  31,  1994.

The  Company  had  a net loss of $1,655,000 in 1995, due primarily to the poor
performance  of  the  Company's  subsidiary  and loss on disposal of assets of
approximately  $805,000.   The loss on disposal is the net effect of a gain on
disposal  of  the  oilfields  that  were  sold  and  a  loss  on  disposal  of
Hydro-Test's  assets.   Net income from the oil and gas segment increased from
1994,  but  it  was  more  than  offset  by  the  subsidiary's  losses.

Oilfield  service  revenues  decreased  approximately  82%  in  1995,  which
significantly  contributed  to  the  Company's  decision  to put Hydro-Test in
Chapter  11  bankruptcy.
Oil  and gas revenues decreased by approximately 10%, due primarily to the net
effect  of  a  decrease  in production as a result of the properties that were
sold,  softened  with  an increase in the price of oil sold from the remaining
properties.

Other  income  increased  approximately  260%,  as a result of interest income
earned  by  the  Company  on  the  $500,000  note  receivable from the sale of
property  in Bakersfield, California, during 1994.  This trend is not expected
to  continue,  as  no  similar  seller-financed  sales  are  contemplated.


<PAGE>
ITEM  6  -  MANAGEMENT  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
            ----------------------------------------------------
             CONDITION  AND  RESULTS  OF  OPERATIONS  (Continued)
             ---------------------------------------

BUSINESS  REVIEW  (Continued)

1995  COMPARED  WITH  1994  (Continued)

Expenses related to the oilfield services segment were 52% and 85% of revenues
for  1995  and 1994.  This decrease is attributable to the significant cuts in
corporate overhead of Hydro-Test, as part of the downsizing and restructuring.
Future  expenses  related to oilfield services are expected to be minimal, but
should  correspond  with  revenues  at  approximately  the  same  ratio.

Expenses related to the production of oil and gas were 53% and 54% in 1995 and
1994,  however,  total  expenses  related  to oil and gas production decreased
approximately  12%.  This overall decrease is the result of decreased expenses
from  properties  sold  mid-year.

Depreciation,  depletion  and  amortization  expense  was  9% and 12% of fixed
assets  in  1995  and  1994,  although  total  depreciation,  depletion  and
amortization  decreased  by 57%.  This decrease was the result of fixed assets
sold  by  Hydro-Test.

General and administrative expense decreased by approximately 56%, as a result
of  cuts in corporate overhead implemented when the new President took office.
The  Company  significantly reduced costs by moving to a less expensive office
and  cutting compensation to the President and Corporate Secretary, as well as
eliminating  other  positions  and  cutting  discretionary  expenses.

The  significant  loss  on  the  sale  of assets was due to the liquidation of
Hydro-Test  assets  for  significantly  less  than the historical cost, net of
accumulated  depreciation.    Several  of  the  larger pieces of equipment had
become  inoperable,  and  other equipment had declined in value simply because
the  services  that  the  equipment  performs  is  no  longer  in demand.  The
remaining  assets  are  not  likely  to  continue  their  decline  in  value.

Most  assets  were  sold  to unrelated entities; however, the Company sold the
assets  of  their Long Beach facilities to two of the directors of the Company
for approximately $260,000.  Management feels that the terms of this agreement
were  at  least  as  favorable  as could be expected from an unrelated entity.


<PAGE>
ITEM  7  -  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA
            -----------------------------------------------
<TABLE>
<CAPTION>


                                                           Page(s)
                                                           -------

<S>                                                        <C>

Report of Brown Armstrong Randall & Reyes,
  Independent Auditor's Report. . . . . . . . . . . . . .    21-22


Consolidated Balance Sheets at December 31, 1996 and 1995    23-24


Consolidated Statements of Operations for the Years Ended
  December 31, 1996 and 1995                                    25


Consolidated Statements of Shareholders' Equity for the
  Years Ended December 31, 1996 and 1995                        26


Consolidated Statements of Cash Flows for the Years Ended
  December 31, 1996 and 1995                                    27


Notes to Consolidated Financial Statements                   28-45
</TABLE>



<PAGE>

<PAGE>

                   REPORT OF BROWN ARMSTRONG RANDALL & REYES
                         INDEPENDENT AUDITOR'S REPORT



Board  of  Directors  and  Shareholders
Petrominerals  Corporation


We  have audited the accompanying consolidated balance sheets of Petrominerals
Corporation  (a  Delaware  corporation) and Subsidiary as of December 31, 1996
and 1995, and the related consolidated statements of operations, shareholders'
equity,  and  cash flows for the two years then ended and the related December
31, 1996 and 1995 financial statement schedules as listed in the index at Item
13(a).  These financial statements and schedules are the responsibility of the
Company's  management.  Our  responsibility  is to express an opinion on these
financial  statements  and  schedules  based  on  our  audits.

We  conducted  our  audit  in  accordance  with  generally  accepted  auditing
standards.  Those  standards  require  that  we  plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material  misstatement. An audit includes examining, on a test basis, evidence
supporting  the  amounts and disclosures in the financial statements. An audit
also  includes  assessing  the  accounting  principles  used  and  significant
estimates  made  by  management,  as  well as evaluating the overall financial
statement  presentation. We believe that our audit provides a reasonable basis
for  our  opinion.
<PAGE>
In  our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Petrominerals Corporation and
consolidated  subsidiary  as of December 31, 1996 and 1995, and the results of
their  operations and their cash flows for the years then ended, in conformity
with  generally  accepted  accounting  principles.
                    BROWN  ARMSTRONG  RANDALL  &  REYES
                    ACCOUNTANCY  CORPORATION






Bakersfield,  California
February  28,  1997


<PAGE>
                           PETROMINERALS CORPORATION
                          CONSOLIDATED BALANCE SHEETS
                          DECEMBER 31, 1996 AND 1995
               (Dollars in thousands, except par value amounts)


                                    ASSETS
<TABLE>
<CAPTION>


                                          1996    1995
                                         ------  ------
<S>                                      <C>     <C>

Current Assets
  Cash and cash equivalents              $  614  $  325
  Accounts receivable, net                  183      83
  Inventories . . . . . . . . . . . . .      61     171
  Prepaid expenses. . . . . . . . . . .      16      11
  Other current assets                       20       -
                                         ------  ------

    Total Current Assets                    894     590
                                         ------  ------

Restricted Cash                              40      84

Property and Equipment, net (including
 oil and gas properties accounted for
 on the successful efforts method)        2,062   2,159

Notes Receivable and Other Assets           461     510
                                         ------  ------

    Total Assets                         $3,457  $3,343
                                         ======  ======
</TABLE>



The accompanying notes are an integral part of these financial statements.
<PAGE>






                     LIABILITIES AND SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>


                                                 1996    1995
                                                ------  ------
<S>                                             <C>     <C>

Current Liabilities
  Accounts payable                              $  464  $  218
  Current portion of long-term debt                  8     170
  Accrued liabilities                               87      86
  Royalties payable                                 42      24
                                                ------  ------
    Total Current Liabilities                      601     498
Long-Term Debt, net of current portion               7     343
Prepetition Liabilities                            521       -
Liabilities Subject to Compromise                    -     555
                                                ------  ------

    Total Liabilities                            1,129   1,396
                                                ------  ------

Shareholders' Equity
  Preferred stock:
    $.10 par value, 5,000,000 shares
      authorized; no shares issued
      and outstanding                                -       -
  Common stock:
    $.10 par value, 20,000,000 shares
      authorized; 8,475,336 and 8,460,336
      shares issued and outstanding at
      December 31, 1996 and 1995,
      respectively                                 848     847

Capital in Excess of Par Value                     563     558

Retained Earnings                                  917     542
                                                ------  ------

    Total Shareholders' Equity                   2,328   1,947
                                                ------  ------

    Total Liabilities and Shareholders' Equity  $3,457  $3,343
                                                ======  ======
</TABLE>



<PAGE>
                           PETROMINERALS CORPORATION
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
               (Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>



                                               1996      1995
                                              ------    ------
<S>                                            <C>        <C>

Revenues
  Oilfield services                            $   14     $701 
  Oil and gas                                   1,185    1,112 
  Other income                                     70      118 
                                               ------   ------

    Total Revenues                              1,269    1,931 
                                               ------   ------

Costs and Expenses
  Oilfield services                               199    1,341 
  Oil and gas                                     561      588 
  Depreciation, depletion and amortization        127      193 
  General and administrative                      418      555 
  Interest                                          3       53 
  Loss on disposal of assets                        -      805 
  Other expense                                    33       51 
                                               ------   ------

    Total Costs and Expenses                    1,341    3,586 
                                               ------   ------

Loss before extraordinary item                    (72)  (1,655)

Extraordinary gain                                448        - 
                                               ------   ------

Net Income (Loss)                                $376  $(1,655)
                                               ======   ======


Per Share Amounts:

  Net loss per share before extraordinary item  $(.01)   $(.20)
                                               ======   ======

  Extraordinary item                            $ .05    $   - 
                                               ======   ======

  Net income (loss) per share                   $ .04    $(.20)
                                               ======   ======


Weighted average common shares
  outstanding                                   8,470    8,455 
                                               ======   ======
</TABLE>



<PAGE>
                           PETROMINERALS CORPORATION
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
                (Dollars in thousands, except number of shares)


<TABLE>
<CAPTION>


                           Common Stock
                           -------------                               
                                               Capital in
                      Number                    Excess of    Retained
                     of Shares     Amount       par Value    Earnings    Total
                     ---------  -------------  -----------  ----------  --------
<S>                  <C>        <C>            <C>          <C>         <C>

Balance,
  December 31, 1994  8,409,936  $         841  $       544  $   2,196   $ 3,581 

Issuance of shares
  for Directors
  Compensation          50,400              6           14          -        20 

Net loss                     -              -            -     (1,655)   (1,655)
                     ---------  -------------  -----------  ----------  --------

Balance,
  December 31, 1995  8,460,336            847          558        541     1,946 

Issuance of shares
  for Officer's
  Compensation          15,000              1            5          -         6 

Net income                   -              -            -        376       376 
                     ---------  -------------  -----------  ----------  --------

Balance,
  December 31, 1996  8,475,336  $         848  $       563  $     917   $ 2,328 
                     =========  =============  ===========  ==========  ========
</TABLE>



<PAGE>
                           PETROMINERALS CORPORATION
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
                            (Dollars in thousands)
<TABLE>
<CAPTION>


                                                            1996     1995
                                                           ------  --------
<S>                                                        <C>     <C>

Cash Flows from Operating Activities:
  Net income (loss)                                        $ 376   $(1,655)
  Adjustments to reconcile net income (loss)
    to net cash provided (used) by operating activities:
      Depreciation, depletion and amortization               127       193 
      Gain on extraordinary item                            (448)        - 
      (Gain) loss on disposal of fixed assets                 (3)      805 
      Other                                                    -        20 
      Accounts receivable                                   (100)      528 
      Other current assets                                   (20)        - 
      Inventories                                            110       199 
      Restricted cash                                         44       (84)
      Accounts payable and accrued liabilities               246      (155)
      Royalties payable . . . . . . . . . . . . . . . . .     18        (8)
      Other long-term liabilities                              -       (26)
      Liabilities subject to compromise                     (555)        - 
      Prepetition liabilities                                521         - 
                                                           ------  --------

   Net Cash Provided (Used) by Operating Activities          316      (183)
                                                           ------  --------

Cash Flows from Investing Activities:
  Purchases of property and equipment                       (102)     (106)
  Proceeds from sale of assets                                66     1,429 
  Notes receivable                                            49      (436)
                                                           ------  --------

   Net Cash Provided by Investing Activities                  13       887 
                                                           ------  --------

Cash Flows from Financing Activities:
  Payments of bank debt                                      (18)     (330)
  (Payments) of line of credit                                 -      (285)
  Payments of prepetition liability                          (22)        - 
                                                           ------  --------
   Net Cash Used by Financing Activities                     (40)     (615)
                                                           ------  --------
Net increase in cash and cash equivalents                    289        89 
Cash and Cash Equivalents at beginning of year               325       236 
                                                           ------  --------
Cash and cash equivalents at end of year                   $ 614   $   325 
                                                           ======  ========

SUPPLEMENTAL DISCLOSURES
Cash Paid During the Period for Interest                   $   3   $    53 
                                                           ======  ========
</TABLE>



<PAGE>

                           PETROMINERALS CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995


NOTE  1  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES
            ----------------------------------------------

Business
--------

Petrominerals  Corporation's  (the  Company's)  principal  business activities
consist  of  the production and sale of crude oil within the United States and
oilfield  services,  which  include  hydro-static  well  testing.

Basis  of  Presentation  and  Going  Concern
--------------------------------------------

PRINCIPLES  OF  CONSOLIDATION

The  consolidated financial statements include the accounts of the Company and
its  wholly-owned subsidiary, Hydro-Test International, Inc. (Hydro-Test). All
material  intercompany  accounts  and  transactions  have  been  eliminated.

GOING  CONCERN

The  consolidated financial statements are presented on a going concern basis.
This  basis  of  accounting  contemplates  the  realization  of  assets  and
satisfaction  of  liabilities in the normal course of business operations. The
Company  incurred  net  losses  before  income taxes and extraordinary item of
$72,000  and  $1,655,000  for  the  years  ended  December  31, 1996 and 1995,
respectively.

Industry  conditions  caused a significant downturn in the Hydro-Test business
in  the  first  quarter  of  1995. Because of this downturn, combined with the
Company's  inability  to refinance its debt and obtain a working capital line,
the  Company  adopted  a  formal  plan to liquidate its subsidiary, Hydro-Test
International,  Inc.,  in March 1995. In September 1995, the Company abandoned
this  plan  and  sought  protection  from  creditors.


<PAGE>
NOTE  1  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)
            ----------------------------------------------

Basis  of  Presentation  and  Going  Concern  (Continued)
--------------------------------------------

GOING  CONCERN  (Continued)

On  September  1, 1995, Hydro-Test International, Inc. commenced its voluntary
reorganization  case  with  the  filing  of a petition under Chapter 11 of the
United  States  Bankruptcy  Code.  This case was filed as a Chapter 11 case to
protect  the  Hydro-Test assets from seizure and pay creditor claims a greater
amount  than  could be obtained in an immediate Chapter 7 liquidation case. On
May  16,  1996,  the  plan of reorganization was accepted by the creditors and
confirmed  by the United States Bankruptcy Courts for the Southern District of
Texas,  Houston  Division.  On  August 14, 1996, a final hearing took place to
approve  the  payment  of  professional fees and order final payment. As such,
Hydro-Test  is no longer in bankruptcy, however, it is uncertain if Hydro-Test
will  be  able  to  satisfy  the  remaining  debt  with  future  cash  flows.

Management  believes  that  the  Company should be able to continue as a going
concern  due to several factors. The oil and gas operations should continue to
provide  adequate  cash  flow to fund the continuing operations of the oil and
gas  production  segment  of  the  Company. Increased oil prices, coupled with
significantly  improved  efficiencies  in  production  costs, should favorably
impact future results. In addition, following approval of the Chapter 11 plan,
management  believes  the  downsized operations should favorably impact future
results.

Use  of  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 liabilities and disclosure of
contingent  assets and liabilities at the date of the financial statements and
the  reported  amounts  of  revenues and expenses during the reporting period.
Actual  results  could  differ  from  those  estimates.

Material  estimates  that  are  particularly susceptible to significant change
relate  to  the  determination of the depreciation, depletion and amortization
(DD&A) account balance and the amount of Hydro-Test's debt that is expected to
be  forgiven as a result of the Chapter 11 proceedings. DD&A is based on units
of  production, and the amount of debt expected to be forgiven is based on the
Chapter  11  bankruptcy  plan.

Cash  and  Cash  Equivalents
----------------------------

The Company considers all highly liquid investments purchased with an original
maturity  of  less  than  three  months  to  be  cash  equivalents.

<PAGE>
NOTE  1  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)
            ----------------------------------------------

Restricted  Cash
----------------

The  Company  has Certificates of Deposit (CD's) with a value of approximately
$40,000  and  $84,000  at  December 31, 1996 and 1995, respectively, that have
been  recorded  as  restricted cash. Of the two CD's remaining at December 31,
1996,  one  has  been  pledged  to  the  Bureau  of  Land  Management to cover
environmental  costs  and  the  other  is  pledged  as  a deposit to a utility
company.  The  Company  also  had  a CD securing an unused letter of credit at
December  31,  1995.

Accounts  Receivable
--------------------

Accounts  receivable  has  been  recorded  net  of  a  valuation  allowance of
approximately $29,000 and $66,000 at December 31, 1996 and 1995, respectively.

Inventories
-----------

The  Company  determines  the  cost  of inventories on the first-in, first-out
(FIFO) method. Inventories of crude oil held under sales contracts are carried
at  market  value.

Property  and  Equipment
------------------------

The  carrying  value  of oilfield service operations property and equipment is
stated  at  estimated  realizable  value.

Oil  and  gas properties are accounted for using the successful efforts method
of  accounting.  Costs  of  drilling  and equipping successful exploratory and
developmental  wells  are  capitalized.  All  other  exploratory  expenses are
charged  to  operations  as  incurred.  The  carrying  value  of  oil  and gas
properties  is  evaluated  in  relation  to the estimated present value of the
future  net  revenues. Depletion, depreciation and amortization are calculated
using  the  unit-of-production  method  based  on  recoverable  reserves.


<PAGE>
NOTE  1  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)
            ----------------------------------------------

Property  and  Equipment  (Continued)
------------------------

In  March  1995,  the  Financial  Accounting  Standards  Board  (FASB)  issued
Statement  of  Financial  Accounting Standards (SFAS) No. 121, "Accounting for
the  Impairment  of  Long-Lived Assets and/or Long-Lived Assets to be Disposed
of." This statement requires that long-lived assets be reviewed for impairment
whenever  events or changes in circumstances indicate that the carrying amount
of  an asset may not be recoverable. It establishes guidelines for determining
recoverability  based  on  future net cash flows from the use of the asset and
for the measurement of the impairment loss. Impairment loss under SFAS No. 121
is  calculated  as the difference between the carrying amount of the asset and
its fair value. Any impairment loss is recorded in the current period in which
the  recognition  criteria  are  first  applied  and met. Under the successful
efforts  method  of  accounting  for  oil  and  gas  operations,  the  Company
periodically  assesses  its proved properties for impairments by comparing the
aggregate  net  book  carrying  amount  of  all  proved  properties with their
aggregate  future  net  cash  flows.  The  new  statement  requires  that  the
impairment  review  be  performed  on  the lowest level of asset groupings for
which  there  are  identifiable  cash  flows. In the case of the Company, this
results  in an impairment review of the Santa Clarita, California, properties.

The  Company adopted SFAS No. 121 in 1996. The impairment loss, if any, on the
oil  and gas properties will be calculated as the difference between the asset
book  carrying  amounts  and  future  undiscounted  net cash flow projections,
giving  consideration  to  recent prices, pricing trends and estimated reserve
quantities.  These  projections  represent the Company's best estimate of fair
value  based  on  the information available. The outcome of implementation did
not  result  in  any  additional  impairments.

In  addition  to recognition of impairment under SFAS No. 121, management also
periodically  assesses the value of significant proved and unproved properties
and  charges  estimated impairments of value to expense. A valuation allowance
expense  of  $1,390,000  was  recorded  in  1993, bringing the total valuation
provision  for  oil and gas properties to $10,963,000. The valuation allowance
has  not  increased since. The carrying value of fixed assets of the Company's
remaining  subsidiary,  Hydro-Test  International,  Inc.,  approximates  net
realizable  value  following  the  disposal  and  abandonment losses that were
recorded  in  1995.

Upon  the  sale  of  oil  and  gas  reserves  in place, costs less accumulated
amortization of such property are removed from the accounts and resulting gain
or  loss  on sale is reflected in operations.  Upon abandonment of properties,
the  reserves are deemed fully depleted and any unamortized costs are recorded
in  the  statement  of  operations  under  loss  on  leases.


<PAGE>
NOTE  1  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)
            ----------------------------------------------

Income  Taxes
-------------
The provision for income taxes is based on pretax financial accounting income.
Deferred  tax  assets  and  liabilities  are  recognized  for the expected tax
consequences  of  temporary  differences  between  the tax basis of assets and
liabilities  and  the  reported  net  amounts.

Per  Share  Computations
------------------------
Per  share  computations  are based upon the weighted average number of common
shares outstanding during each year. Common stock equivalents are not included
in  the  computation  since  their  effect  would  be  anti-dilutive.

Reclassifications
-----------------
Certain  prior  year  amounts  have  been  reclassified  to  conform  to
classifications  followed for 1996. These reclassifications had no effect upon
reported  net  income.

NOTE  2  -  PROPERTY  AND  EQUIPMENT
            ------------------------

Property  and  equipment,  all  of  which  is located in the United States, is
stated  at  cost  or  net  realizable  value  and consists of the following at
December  31,:
<TABLE>
<CAPTION>


                                                1996          1995
                                              ---------  ---------------
                                                    (in thousands)
<S>                                           <C>        <C>

At Cost:
  Oil and gas properties, all proved, net of
    valuation allowance of $10,963            $ 21,625   $       21,404 
  Accumulated depletion and amortization       (20,873)         (20,767)
                                              ---------  ---------------
Net oil and gas properties                         752              637 
                                              ---------  ---------------
Other Property and Equipment:
  Land and building                              1,265            1,265 
  Oilfield service equipment                         -               22 
  Furniture, fixtures and equipment                337              341 
  Construction in process                            -               85 
  Accumulated depreciation related to
    other property and equipment                  (443)            (441)
                                              ---------  ---------------
Net other property and equipment                 1,159            1,272 
                                              ---------  ---------------
Net property and equipment, at cost              1,911            1,909 
                                              ---------  ---------------
At Net Realizable Value:
  Oilfield service equipment                       151              250 
                                              ---------  ---------------
Property and equipment, net                   $  2,062   $        2,159 
                                              =========  ===============
</TABLE>



<PAGE>
NOTE  2  -  PROPERTY  AND  EQUIPMENT  (Continued)
            ------------------------

Depreciation, depletion and amortization for the years ended December 31, 1996
and  1995  was  $26,736  and  $192,897,  respectively.


NOTE  3  -  PREPETITION  LIABILITIES/EXTRAORDINARY  GAIN
            --------------------------------------------

Liabilities  subject  to  compromise  were  stated  in  the  December 31, 1995
financial  statements  at  the  amount  of  the  original claim and not at the
amounts for which the claims were settled. Certain claims were settled outside
of bankruptcy, however, most of the claims were settled at 50% of the original
prepetition  liability.  The  Company has not accrued interest on these claims
since  seeking  protection  on  September  1,  1995.

The  reorganization  resulted  in  an  extraordinary gain of $448,000 from the
retirement  of  prepetition liabilities. This event will not result in taxable
income  to  the  Company  because  this  gain  did  not exceed prepetition net
operating  losses.  As  such,  no  provision  for taxes has been recorded as a
result  of  this  transaction.

The remaining prepetition liability of $521,000 has been recorded as long-term
as  management  does  not  intend  to  repay these liabilities within the next
operating  cycle.  Under  the  approved  plan,  the  Company  will repay these
liabilities  with  funds  generated  from  the  sale  of  assets or continuing
operations,  within  60  months  of  the  plan's  approval  on  May  16, 1996.


NOTE  4  -  LONG-TERM  DEBT
            ---------------

Long-term  debt  at  December  31,  is  summarized  as follows (in thousands):
<TABLE>
<CAPTION>


                                                1996  1995
                                                ----  -----
<S>                                          <C>  <C>   <C>

Unsecured notes payable due in
  monthly installments of $7,000,
  including interest of 8.5% - 9.5%          $     -  $ 206

Capitalized lease secured by equipment,
  monthly payments of $7,300                       -     81

Term note payable to City of Deming,
  New Mexico, due in monthly installments
  of $2,000, including discounted interest
  of 8.95%                                         -    192
</TABLE>



<PAGE>
NOTE  4  -  LONG-TERM  DEBT  (Continued)
            ---------------
<TABLE>
<CAPTION>


                                        1996   1995
                                        -----  -----
<S>                                     <C>    <C>

Other                                       -     34

Bank term notes payable (secured by
  various vehicles), due in monthly
  installments of $604, plus interest
  of 8.9% to 9.9%                          15      -
                                        -----  -----

                                           15    513
  Less current portion                      8    170
                                        -----  -----

                                        $   7  $ 343
                                        =====  =====
</TABLE>


Aggregate  scheduled  maturities of long-term debt at December 31, 1996 are as
follows:
<TABLE>
<CAPTION>


Year Ended
----------   
<S>         <C>

1997        $ 8
1998          7
            ---

            $15
            ===

</TABLE>


NOTE  5  -  DISPOSITION  OF  ASSETS
            -----------------------

In  June  1995,  the Company sold its interest in certain oilfields located in
the  Livonia field of Pointe Coupee Parish, Louisiana, for total consideration
of  $155,000.    Following  this  disposal, the Company no longer operates any
oilfields outside the State of California.  The proceeds of the sale were used
to  fund  continuing  operations.

In  August 1995, the Company sold its interest in oilfields located near Santa
Maria,  California,  for  total  consideration  of  $150,000.   Following this
disposal,  the  Company  no  longer  operates  oilfields  outside of the Santa
Clarita  Valley  in  Los Angeles County, California.  The proceeds of the sale
were  used  to  fund  continuing  operations.


<PAGE>
NOTE  5  -  DISPOSITION  OF  ASSETS  (Continued)
            -----------------------
Liquidation  and  Reorganization  Sales
---------------------------------------
As a result of the Company's liquidation plan and its reorganization plan (see
Note  1),  the  Company  sold  certain  assets  of  its subsidiary, Hydro-Test
International,  Inc.  (HTI).  These  sales  are  discussed  below.

On  May  16,  1995,  HTI  entered  into an agreement with two directors of the
Company to purchase the assets of HTI's Long Beach location for $260,000. (See
Note  8  -  Related  Parties  and  Related  Party  Transactions).

On  July  6,  1995,  HTI  sold certain vehicles, fixtures, and equipment to an
unrelated  party  for  total  consideration  of  $155,600.

During 1995, HTI also sold other inventory and equipment to various purchasers
for  total  consideration  of  approximately  $240,000.

Sales  and  abandonments  at  December  31,  1995  resulting  from  HTI's
reorganization  resulted  in a net loss of approximately $938,000. This amount
is  reflected  in the accompanying consolidated financial statements as a loss
on  disposal  of  assets.

On  January  29,  1996,  the  Company  sold  all  of  the  remaining assets of
Hydro-Test's  manufacturing  operations  to  an unrelated entity in Canada for
$135,000  in  cash.  This sale was approved by the Bankruptcy Court. Following
this  sale,  the  Company  continues to perform other oilfield services but no
longer  manufactures  products.

Hydro-Test  sold  five  surplus  trucks  in two sales to an unrelated party on
August  23,  and  September  17,  1996,  for  total  consideration of $10,700.
Additionally, two stationary testing units were sold to an unrelated party for
$50,000  on  October  15,  1996.

NOTE  6  -  INCOME  TAXES
            -------------

A  reconciliation of the provision (benefit) for income taxes to the statutory
Federal  income  tax  rate  before  extraordinary  items  is  as  follows:
<TABLE>
<CAPTION>


                                                Years Ended December 31,
                                               --------------------------
                                               1996              1995
                                              ------  --------------------------
                                                            (in thousands)
<S>                                           <C>     <C>

Statutory Federal income tax (benefit)        $ (15)  $                    (579)
Increase (decrease) in provision
  resulting from losses without tax benefit      15                         579 
                                              ------  --------------------------

                                              $   -   $                       - 
                                              ======  ==========================
</TABLE>



<PAGE>
NOTE  6  -  INCOME  TAXES  (Continued)
            -------------

Deferred  income  taxes  reflect  the net tax effects of temporary differences
between  the carrying amount of assets and liabilities for financial reporting
purposes  and  the  amount  used for income tax purposes.  The following table
summarizes the significant components of the Company's deferred tax assets and
liabilities  as  of  December  31,:
<TABLE>
<CAPTION>


                                               1996      1995
                                             --------  --------
<S>                                          <C>       <C>

Deferred Tax Assets:
  Reserve for impaired assets                $     -   $   473 
  Net operating loss carryforwards             1,917     2,318 
  Depletion carryovers                             -       478 
  State income taxes and other                     -        16 
                                             --------  --------
    Total Deferred Tax Assets                  1,917     3,285 
  Valuation reserve for deferred tax assets   (1,906)   (3,238)
                                             --------  --------
    Net Deferred Tax Assets                  $    11   $    47 
                                             ========  ========
Deferred Tax Liabilities:
  Tax over book depreciation,
    amortization and depletion               $    11   $    39 
  Accruals without tax benefit                     -         8 
                                             --------  --------
    Total Deferred Tax Liabilities                11        47 
                                             --------  --------
    Net Deferred Tax Liabilities             $     -   $     - 
                                             ========  ========
</TABLE>


At  December  31,  1996,  the  Company had net operating loss carryforwards of
approximately  $5,637 for Federal income tax purposes that will expire through
the  year  2002.  For  financial  reporting purposes, a valuation allowance of
$1,906 has been recorded to offset the deferred tax asset related primarily to
these  carryforwards.


NOTE  7  -  COMMON  STOCK
            -------------

On  February  8, 1993, the Board of Directors adopted the 1993 Incentive Stock
Option  Plan  and  the  1993 Non-Statutory Stock Option Plan (the Plans).  The
Plans  provide  for  the  granting  of  options to purchase up to a maximum of
1,200,000  shares of the Company's common stock to officers, key employees and
directors  who  are  not  otherwise employed by the Company.  Under the Plans,
options  granted  to non-employee directors are limited to a maximum of 60,000
shares  of  the Company's common stock.  The Plans expire on February 8, 2003.
No  shares  were  awarded  under  this  plan  in  1996.


<PAGE>
NOTE  7  -  COMMON  STOCK  (Continued)
            -------------

On  February 8, 1993, the Board of Directors adopted the 1993 Stock Bonus Plan
(the Bonus Plan). The Bonus Plan provides for the award of up to 50,000 shares
of  the  Company's  common stock to officers and key employees of the Company.
The  Bonus  Plan  was  approved  by  the  shareholders at the Company's Annual
Meeting  on May 23, 1993. The Bonus Plan expires on February 8, 1998. To date,
no  shares  have  been  awarded  under  the  Bonus  Plan.

On  April  16,  1992,  the  Board  of  Directors  adopted  the Directors Stock
Compensation  Plan (the Stock Compensation Plan).  The Stock Compensation Plan
was  adopted  as  part  of  the Company's cost containment program.  The Stock
Compensation  Plan  provides  for  the granting of up to 150,000 shares of the
Company's common stock to non-employee directors. Under the Stock Compensation
Plan  for  the  period  May  1992  through  September 1993, 99,600 shares were
granted  to  directors.  On February 10, 1995, the balance of 50,400 shares of
the  Company's  common  stock were granted to six non-employee directors under
the  Stock  Compensation  Plan  for the period October 1993 through June 1994.
The Stock Compensation Plan terminated on February 10, 1995, at which time all
of  the  shares  issued  under  the  Directors  Stock  Compensation  Plan were
distributed  to  the  six  non-employee  directors.

On  October  24,  1995,  the Board approved the issuance of 15,000 shares to a
former  officer  of the Company who was laid off due to downsizing in 1995 and
received  the  shares  on April 19, 1996, as a portion of a severance package.
Management  has  valued  this transaction as $5,625 in officer's compensation.


NOTE  8  -  RELATED  PARTIES  AND  RELATED  PARTY  TRANSACTIONS
            ---------------------------------------------------

During  the  periods  covered  by  the  financial  statements, the Company was
involved  in  various transactions with related parties. These related parties
consist  primarily  of  corporations  and  joint  ventures  in which officers,
directors,  and  shareholders  of the Company, directly and/or indirectly, own
varying  ownership interest and/or are officers and directors thereof. Related
party  transactions  involving  the  purchase  of  property  and equipment and
services  were  approximately  $280,000  and  $260,000  for  1996  and  1995,
respectively.


<PAGE>
NOTE  8  -  RELATED  PARTIES  AND  RELATED  PARTY  TRANSACTIONS
            ---------------------------------------------------
              (Continued)

On  May  16,  1995,  HTI  entered  into an agreement with two directors of the
Company  to purchase the assets of HTI's Long Beach location for $260,000. The
first  director  is  the  Vice-President  of  HTI  and  the second director is
Assistant  Secretary/Treasurer  of  Petrominerals. The purchaser paid $115,000
upon  acceptance  of  the  offer  and  $145,000  when  title to the assets was
transferred.

On  December  3, 1996, the Company became the general partner of Petrominerals
96-1,  a  newly  formed  limited partnership. The Company has a 1% interest as
general  partner  and  6  other  entities, including 2 directors and a company
controlled  by a director, own the remaining 99% interest. The partnership was
formed  to  enter  into  a joint venture agreement with the Company to drill a
well  on  the Company's Mabel Strawn lease. The Company received $280,000 from
the  partnership  under a turnkey drilling contract. Proceeds from the working
interest  will  be paid 90% to Petrominerals 96-1 and 10% to the Company until
payout,  and  thereafter 30% to Petrominerals 96-1 and 70% to the Company. The
Company  estimates  that  payout  will occur 24 months after completion of the
well. The Company completed the well on January 20, 1997, and began production
shortly  thereafter  (see  subsequent  events  in  Note  13).


NOTE  9  -  UNAUDITED  QUARTERLY  FINANCIAL  DATA
            -------------------------------------
<TABLE>
<CAPTION>
                        First     Second     Third    Fourth
                        Quarter   Quarter    Quarter  Quarter   Year
                       --------  ---------  --------  -------  -------
1996:                      (in thousands, except per share amounts)
---------------------                                                          
<S>                    <C>        <C>        <C>        <C>        <C>

Revenues               $    272   $    322   $    316   $     359  $1,269 
Costs and expenses          364        362        311         304   1,341 
Income (loss) before
 extraordinary item         (92)       (40)         5          55     (72)
Extraordinary gain            -     (1)448          -           -     448 
Net income (loss)           (92)       408          5          55     376 
Income (loss) before
  extraordinary item
  per share                (.01)         -          -           -    (.01)
Net income (loss)
  per share                (.01)       .05          -           -     .04 

(1) The estimated extraordinary gain reported in the second quarter for 10-QSB 
    was revised as a result of audit adjustments.
</TABLE>



<PAGE>
NOTE  9  -  UNAUDITED  QUARTERLY  FINANCIAL  DATA  (Continued)
            -------------------------------------

The Company recognized an extraordinary gain in the second quarter of 1996 for
debt  forgiven  in  bankruptcy.
<TABLE>
<CAPTION>


                       First     Second      Third     Fourth
                      Quarter    Quarter    Quarter    Quarter     Year
                     ---------  ---------  ---------  ----------  --------
1995:                        (in thousands, except per share amounts)
-------------------                                                           
<S>                  <C>        <C>        <C>        <C>        <C>

Revenues             $    392   $    542   $    413   $     584  $ 1,931 
Costs and expenses        698        600      1,809         479    3,586 
Net income (loss)        (306)       (58)    (1,396)        105   (1,655)
Net income (loss)
  per share              (.04)      (.01)      (.16)        .01     (.20)
</TABLE>



NOTE  10  -  SEGMENT  INFORMATION
             --------------------

The  Company's  principal  businesses are (1) the production and sale of crude
oil  and  natural gas, and (2) oilfield services. The following tables present
certain  information  regarding  these  industry  segments for the years ended
December  31,  1996  and  1995:
<TABLE>
<CAPTION>


                                             Oil and Gas
                               Oilfield      Production
                               Services      and Sales
                             -------------  ------------

1996:
---------------------------
<S>                          <C>            <C>

Sales to outside customers   $          14   $      1,273
Operating profit (loss)               (210)           125
Gain on debt forgiven                  448              -
Identifiable assets                    231          3,226
Depreciation, depletion
  and amortization                      10            117
Capital expenditures                     -            102

1995:
---------------------------

Sales to outside customers   $         701   $      1,112
Operating profit (loss)             (1,861)           206
Identifiable assets                    467          2,876
Depreciation, depletion
  and amortization                      66            127
Capital expenditures                     -            106

(a) Corporate revenues are primarily composed of interest income and royalty
interests.



                              Corporate(a)     Total
                             ---------------  --------
                             (in thousands)

1996:
---------------------------                       
<S>                          <C>              <C>

Sales to outside customers   $            67  $ 1,354 
Operating profit (loss)                    -      (85)
Gain on debt forgiven                      -      448 
Identifiable assets                        -    3,457 
Depreciation, depletion
  and amortization                         -      127 
Capital expenditures                       -      102 

1995:
---------------------------                           

Sales to outside customers   $           118  $ 1,931 
Operating profit (loss)                    -   (1,655)
Identifiable assets                        -    3,343 
Depreciation, depletion
  and amortization                         -      193 
Capital expenditures                       -      106 

(a)
</TABLE>



<PAGE>
NOTE  10  -  SEGMENT  INFORMATION  (Continued)
             --------------------

Sales  to  individual  customers,  including  royalty  interests  of  others,
exceeding  10  percent  of revenues reported in the consolidated statements of
operations,  are  as  follows:
<TABLE>
<CAPTION>


                                          Years Ended December 31,
                                         -------------------------
                                       1996             1995
                                       -----  --------------------
<S>                                 <C>  <C>    <C>

Oil and gas segment (gross sales):
  ENRON Oil & Gas
    Trading, Inc.                   $      -  $                   1,190
  Texaco Trading &
    Transportation, Inc.               1,161                        354
</TABLE>



NOTE  11  -  ENVIRONMENTAL  MATTERS
             ----------------------

On  December  6,  1989,  the  Company  was  notified  by  the  United  States
Environmental  Protection  Agency  (EPA)  that,  under  provisions  of  the
Comprehensive  Environmental  Response, Compensation and Liability Act of 1980
(CERCLA),  the Company was considered a potentially responsible party (PRP) in
the  clean-up  of  the  Operating  Industries, Inc. (OII) waste disposal site,
located in Monterey Park, California. The EPA has also contacted approximately
270  other  PRPs  who disposed of liquid waste at this site. The Company is in
the  fourth  tier  of  PRPs  notified  by  the  EPA,  regarding  this  site.

Management  continues to gather information related to this matter. Based upon
information available to it at this time, management believes that the Company
(through  its  predecessors, Century Oil Corporation) disposed of drilling mud
and  water  at the OII waste disposal site at various times from 1975 to 1977.
The  Company contends that any drilling mud and waste water disposed of by the
Company  do  not  contribute  to  the  problem  at  the OII site. Although the
ultimate  impact  of the resolution of this contingency is unknown, management
believes  that  this  matter  will  not  have a material adverse effect on the
financial  position  of  the  Company.

NOTE  12  -  CONTINGENCIES
             -------------

The  Company  has  certain  contingent liabilities with respect to litigation,
claims,  taxes, government regulations and contractual agreements arising from
the  ordinary  course  of  business.  While there are always risks inherent in
resolution  of  any  contingency,  it  is  the opinion of management that such
contingent liabilities will not result in any loss which would have an adverse
material  effect  on  the  Company's  financial  position.

<PAGE>
NOTE  12  -  CONTINGENCIES  (Continued)
             -------------

The  Company  is  subject  to  other  possible  loss contingencies pursuant to
federal,  state  and  local  environmental laws and regulations. These include
existing  and  potential obligations to investigate the effects of the release
of certain hydro-carbons or other substances at various sites; to remediate or
restore  these  sites;  and to compensate others for damages and to make other
payments  as  required by law or regulation. These obligations relate to sites
owned  by  the Company or others, and are associated with past and present oil
and  gas  operations. The amount of such obligations is indeterminate and will
depend  on such factors as the unknown nature and extent of contamination, the
unknown  timing,  extent and method of remedial actions which may be required,
the  determination  of  the  Company's  liability  in  proportion  to  other
responsible  parties,  and  the  state  of  the  law.


NOTE  13  -  SUPPLEMENTAL  OIL  AND  GAS  PROPERTIES  AND  RELATED
             -----------------------------------------------------
                RESERVES  (UNAUDITED)
                ---------------------

Results  of  Operations
-----------------------

Selected  financial information for oil and gas operations accounted for under
the  successful  efforts  methods  is  summarized  below:
<TABLE>
<CAPTION>


                                                      Years Ended December 31,
                                                     --------------------------
                                              1996              1995
                                             ------  --------------------------
                                                           (in thousands)
<S>                                          <C>     <C>

Produced oil and gas sales                   $1,185  $                    1,112
Less:
  Operating expenses                            561                         588
  Depreciation, depletion and amortization      116                         127
                                             ------  --------------------------

Results of operations from oil and gas
  producing activities, excluding corporate
  overhead and interest costs                $  508  $                      397
                                             ======  ==========================
</TABLE>


No  development  or  property acquisition costs were incurred in 1996 or 1995.


<PAGE>
NOTE  13  -  SUPPLEMENTAL  OIL  AND  GAS  PROPERTIES  AND  RELATED
             -----------------------------------------------------
                RESERVES  (UNAUDITED)  (Continued)
                ---------------------

Estimated  Quantities  of  Oil  and  Gas  Reserves
--------------------------------------------------

The  following  tables  present  the Company's estimates of its proved oil (in
thousands  of barrels) and gas (in millions of cubic feet) reserves, which are
all  located in the United States. All reserve estimates have been prepared by
independent petroleum engineers. The Company emphasizes that reserve estimates
are  inherently  imprecise  and  are  expected to change as future information
becomes  available.
<TABLE>
<CAPTION>


                                                 Year Ended December 31,
                                                 -----------------------
                                                 1996              1995
                                                 ----              ----
                                              Oil    Gas    Oil     Gas
                                            ------  ----  ------  ---------
<S>                                         <C>     <C>   <C>     <C>

Proved developed and undeveloped reserves:
  Beginning of period                       2,138      -  2,247        272 
  Revision of previous estimates              (33)     -    119          - 
  Sale of minerals in place                     -      -   (102)      (216)
  Production                                 (106)     -   (126)       (56)
                                            ------  ----  ------  -----------

End of period                               1,999      -  2,138          - 

Proved developed reserves:
  Beginning of period                         897      -    971        126 
  End of period                               952      -    897          - 
</TABLE>


Discounted  Future  Net  Cash  Flows  Relating  to Proved Oil and Gas Reserves
------------------------------------------------------------------------------

A  standardized measure of discounted future net cash flows is presented below
for  each  of  the years ended December 31, 1996 and 1995. Future cash inflows
are  computed  by  applying  year-end  prices  of  oil and gas relating to the
Company's  proved  reserves  to  year-end  quantities  of  those  reserves.

Future  development  and  production  costs  are  computed  by  estimating the
expenditures  to  be  incurred for developing and producing proved oil and gas
reserves,  based  on  year-end  costs  and  assuming  continuation of existing
economic  conditions.

Future  income  tax  expense  is computed by applying year-end statutory rates
(adjusted  for  permanent  differences)  to  the  future pretax net cash flows
relating  to  the Company's proved oil and gas reserves, less the tax basis at
each  year-end  of  the  properties  involved.

A  10%  annual  discount rate is used to reflect the timing of future net cash
flows  relating  to  proved  oil  and  gas  reserves.


<PAGE>
NOTE  13  -  SUPPLEMENTAL  OIL  AND  GAS  PROPERTIES  AND  RELATED
             -----------------------------------------------------
                RESERVES  (UNAUDITED)  (Continued)
                ---------------------

Discounted  Future  Net  Cash  Flows  Relating  to Proved Oil and Gas Reserves
------------------------------------------------------------------------------
(Continued)
-----

The  projections  should  not  be viewed as realistic estimates of future cash
flows,  nor  should  the "standardized measure" be interpreted as representing
current  value  to  the  Company.  Material  revisions  to estimates of proved
reserves  may  occur in the future; development and production of the reserves
may  not  occur  in the periods assumed; and actual prices realized and actual
costs  incurred  may  vary  significantly  from  those  used.

The  following  reserve  estimates  and  resulting  future net cash flows were
developed  in  accordance with Securities and Exchange Commission rules, using
selling  prices in effect at the end of the years indicated. Both the quantity
estimates  and "cash flow" of reserves are sensitive to sales prices in effect
at  the  year  end  quantification  date.  During  periods of rapidly changing
prices,  reserve  information  must  be  examined  with  this  understanding.
<TABLE>
<CAPTION>


                                                     Year Ended December 31,
                                                    -------------------------
                                           1996               1995
                                         ---------  -------------------------
                                                         (in thousands)
<S>                                      <C>        <C>

Future cash inflows                      $ 35,172   $                 27,440 
Future production and development costs   (17,738)                   (15,272)
Future income tax expense                  (5,928)                    (4,137)
                                         ---------  -------------------------

Future net cash flows                      11,506                      8,031 
10% annual discount for estimated
  timing of cash flows                     (5,862)                    (4,508)
                                         ---------  -------------------------
Standardized measure of discounted
  future net cash flows                  $  5,644   $                  3,523 
                                         =========  =========================
</TABLE>



<PAGE>
NOTE  13  -  SUPPLEMENTAL  OIL  AND  GAS  PROPERTIES  AND  RELATED
             -----------------------------------------------------
                RESERVES  (UNAUDITED)  (Continued)
                ---------------------

Discounted  Future  Net  Cash  Flows  Relating  to Proved Oil and Gas Reserves
------------------------------------------------------------------------------
(Continued)
-----

Following  are  the principal sources of change in the standardized measure of
discounted  future  cash  flows:
<TABLE>
<CAPTION>

                                                       Year Ended December 31,
                                                      -------------------------
                                              1996              1995
                                             -------  -------------------------
<S>                                          <C>      <C>
                                                                 (in thousands)
Sales and transfers of oil and gas
  produced, net of production cost           $ (584)  $                   (517)
Net changes in prices and production
  costs, based on beginning of year barrels   1,331                      2,573 
Net change in previous estimate of
  future development costs                     (316)                    (1,064)
Revisions to previous estimates                (188)                       233 
Accretion of discount                           564                        352 
Net change in income taxes                    1,791                       (477)
Other                                          (477)                      (477)
                                             -------  -------------------------
Net increase                                 $2,121   $                    623 
                                             =======  =========================
</TABLE>



NOTE  14  -  SUBSEQUENT  EVENTS
             ------------------

Related  Party  Transaction
---------------------------

On  December  20, 1996, the Company completed drilling a producing well on its
Mabel Strawn lease in Hasley Canyon, Los Angeles County, California, on behalf
of  Petrominerals  96-1,  which was formed on December 3, 1996, and holds a 1%
partnership  interest.  The  well  began  production  on January 20, 1997. The
Company  entered  into  a  joint  venture agreement with Petrominerals 96-1 to
drill  the  well  on  a designated drill site in a known producing area at the
Company's  Mabel  Strawn  oil  lease.  Under  the  terms  of the joint venture
agreement,  the  Company assigned the drillsite to the joint venture, and will
share  the  revenues  produced  and  the expenses incurred. Payout occurs when
Petrominerals  96-1  has  recouped  the  monies  it  contributed  to the joint
venture.  Proceeds from the working interest will be paid 90% to Petrominerals
96-1  and 10% to the Company until payout, and thereafter 30% to Petrominerals
96-1  and  70% to the Company. The Company estimates that payout will occur 24
months  after  completion  of  the  well. Under the joint venture, the Company
furnished  the  drill site and all casing required for the well, and leased to
the  joint  venture  the  rods,  tubing and downhole and surface pumps and all
other  tangible  equipment  necessary  to produce the well. Petrominerals 96-1
contributed the sum of $280,000 for the intangible costs of drilling the well.

<PAGE>
NOTE  14  -  SUBSEQUENT  EVENTS  (Continued)
             ------------------

Three directors of the Company are limited partners in Petrominerals 96-1. The
respective  percentage  interests of the partners in Petrominerals 96-1 are as
follows:
<TABLE>
<CAPTION>


                                  % Interest   Capital Contribution
                                  -----------  ---------------------
General Partner:
<S>                               <C>          <C>
 Petrominerals Corporation              1.00%  $               2,800

  Limited Partners:
    Paul L. Howard (director)          23.21%  $              65,000
    Morris L. Hodges (director)        17.86%  $              50,000
    David G. Davidson (director)       17.86%  $              50,000
    Unrelated parties                  40.07%  $             112,200
</TABLE>


Under  the  terms  of  the  agreement, the Company will receive a $350 monthly
management fee and a monthly rental fee for the tangible equipment. The rental
fee  is  $2,400  per  month  until payout and $400 per month thereafter. These
payments  began  in  1997.

Sale  of  Property  and  Equipment
----------------------------------

On February 12, 1997, the Company sold an additional testing truck for $16,000
cash,  plus an additional $2,000 which is to be paid over a 12 month period in
monthly  installments.


ITEM  8  -  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON
            ------------------------------------------------------
             ACCOUNTING  ANDFINANCIAL  DISCLOSURE
             ------------------------------------

None.


<PAGE>
                                   PART III


ITEM  9  -  DIRECTORS,  EXECUTIVE  OFFICERS,  COMPLIANCE  WITH  SECTION
            -----------------------------------------------------------
            16(A)  OF  THE  SECURITIES  EXCHANGE  ACT  OF  1934
            ---------------------------------------------------

The Executive Officers of Petrominerals, together with the years in which such
Officers  were  named  to  their  present  offices  are  as  follows:
<TABLE>
<CAPTION>
<S><C>

                                                             Year Named to
Name                             Position with Company       Present Position
-------------------------------- --------------------------  ----------------

Paul L. Howard(1)                President, Chief Executive
                                 Officer, Chief Financial
                                 Officer and Director           1995

Phillip Mungiovino(2)            Secretary                      1995

Morris V. Hodges(3)              Assistant Secretary and
                                 Director                       1995

Each of the Executive Officers serves at the pleasure of the Board of Directors.
<FN>

(1) Mr.  Howard  was  reappointed  President  and  Chief  Executive
Officer  on  March  24,  1995.

(2) Mr. Mungiovino was appointed Secretary on March 24, 1995.  Mr. Mungiovino 
has held the position of accountant for the
Company  since  1975.

(3) Mr.  Hodges  was  appointed  Assistant  Secretary  on  March  24,  1995.
</TABLE>


Biographical  Information
-------------------------

The  following  table  sets  forth the name, principal occupation, age and the
year  in which the individual first became a director, and business experience
during  the  last  five  years:

PAUL  L.  HOWARD  -  71          Director          1975
----------------

Mr.  Howard was reappointed President and Chief Executive Officer on March 24,
1995.    He also served as President of the Company from November 1975 through
September  1987,  and  at various times during this period, served as Chairman
and Chief Executive Officer.  For more than the past 10 years, Mr. Howard held
a  controlling  interest  in  and served as director and officer of Howard Oil
Company  and  California  Petroleum Products, Inc.  See "Certain Relationships
and  Related  Transactions."

<PAGE>
ITEM  9  -  DIRECTORS,  EXECUTIVE  OFFICERS,  COMPLIANCE  WITH  SECTION
            -----------------------------------------------------------
            16(A)  OF  THE  SECURITIES  EXCHANGE  ACT  OF  1934  (Continued)
            ---------------------------------------------------

DAVID  G.  DAVIDSON  -  72          Director          1979
-------------------

Mr.  Davidson  has  been  principally  employed as President and Owner of OP&E
Company  since  1984.    Mr.  Davidson  serves as a director of Mieco, Inc., a
public  company  engaged  in  domestic  and  foreign  petroleum  trading.

EVERETT  L.  HODGES  -  62          Director          1979
-------------------

Mr.  Everett  L. Hodges served as President of the Company from September 1987
through  February 1992.  For more than the past ten years, Mr. Hodges has held
a  controlling  interest in and has served as a director and officer of Energy
Production  &  Sales  Co.,  Inc.;  California  Oil  Independents, Inc.; Costal
Petroleum  Refiners,  Inc.;  California Tar Sands Development Corporation; and
has  served as a director of St. James Oil Corporation since 1988.  Mr. Hodges
has  also  served  as  the  President  of  the Violence Research Foundation, a
non-profit  foundation, since its inception in 1991.  Certain of the foregoing
companies  have been affiliated with the Company in various transactions.  See
"Certain  Relationships  and  Related  Transactions."    Everett L. Hodges and
Morris  V.  Hodges,  as  a  group,  may  be  deemed to be controlling persons.

MORRIS  V.  HODGES  -  60          Director          1979
------------------

Mr. Morris V. Hodges was appointed Assistant Secretary on March 24, 1995.  Mr.
Morris  Hodges has held a controlling interest in and has served as a director
and  officer  of  the  following  companies  for more than the past ten years:
Hillcrest  Beverly  Oil  Corporation;  Century  Resources  Development; Kaymor
Petroleum  Products,  Inc.;  Sunset  Pipeline  and  Terminalling, Inc.; Costal
Petroleum  Refiners, Inc.; and CPR Transportation.  Mr. Hodges has also served
as  a  director  of  St.  James  Oil  Corporation  since 1988.  Certain of the
foregoing  companies  have  been  affiliated  with  the  Company  in  various
transactions.  See "Certain Relationships and related Transactions." Morris V.
Hodges  and  Everett  L.  Hodges,  as a group, may be deemed to be controlling
persons.


<PAGE>
ITEM  9  -  DIRECTORS,  EXECUTIVE  OFFICERS,  COMPLIANCE  WITH  SECTION
            -----------------------------------------------------------
            16(A)  OF  THE  SECURITIES  EXCHANGE  ACT  OF  1934  (Continued)
            ---------------------------------------------------

Standing  Committees  and  Meetings  of  the  Board  of  Directors
------------------------------------------------------------------

STANDING  COMMITTEES

The Company has certain standing committees, each of which is described below:

Ad-Hoc  Committee  -  This  committee  consists of Messrs. Morris Hodges, Paul
-----------------
Howard  and  David  Davidson.  This committee evaluates proposed acquisitions,
mergers or other pertinent negotiations which may come before the Board.  This
committee  held  no  meetings  during  the  last  fiscal  year.

Audit  Committee  -  This committee consists of Messrs. Paul Howard and Morris
----------------
Hodges.  Mr. Howard serves as Chairman of this committee.  The Audit Committee
is  responsible  for  reviewing  the scope and procedures of internal auditing
work,  the  results  of  independent  audits,  the  accounting  policies  of
management,  and  recommends  to  the  Board  the appointment of the Company's
outside  auditors.    This committee did not hold any meetings during the last
fiscal  year.

Compensation  Committee - This committee consists of Mr. David Davidson.  This
-----------------------
committee  reviews  and  makes  recommendations  to  the  Board  of  Directors
regarding  compensation  for  the  Company's  officers  and key employees.  In
addition  to  compensation  matters,  the  committee determines, develops, and
makes  recommendations  to the Board regarding employee benefits packages, and
special  stock  option  and stock bonus plans.  This committee held no meeting
during  the  last  fiscal  year.

ATTENDANCE  AT  BOARD  MEETINGS

During  the last fiscal year, the Board of Directors of the Company held three
regular  meetings and one special meeting.  Attendance at such meetings of the
Board  was  100%.


<PAGE>
ITEM  10  -  EXECUTIVE  COMPENSATION
             -----------------------

The  following  Summary  Compensation  Table  sets forth all cash compensation
paid,  distributed or accrued for services, including salary and bonus amounts
rendered  in  all  capacities  for  the  Company  during the fiscal year ended
December  31, 1996, whose annual cash compensation exceeded $100,000 or served
as Chief Executive Officer. All other tables required to be reported have been
omitted as there has been no compensation awarded to, earned by or paid to any
of  the  Company's  executives  in  any  fiscal  year  covered  by  the table.

SUMMARY  COMPENSATION  TABLE

   Name  and  Principal                   Annual Compensation
                                          -------------------
         Position                    Year                    Salary
-----------------                    ----                    ------

Paul  L.  Howard,
President,  Chief
Executive  Officer  and
Chief  Financial  Officer            1996                    $ 92,000

Mr  Howard  was  appointed  Chairman,  President, Chief Executive Officer, and
Chief  Financial  Officer of Petrominerals Corporation on March 24, 1995.  His
compensation  for  the  year  ended  December  31,  1995, was in the form of a
director's  fee  of  $5,000  per  month.  At the March 1996 board meeting, the
directors increased Mr. Howard's salary to $7,500 per month, effective January
1,  1996.    Mr.  Howard  now  receives  an annual salary of $90,000 per year.

OTHER  COMPENSATION  OF  EXECUTIVE  OFFICERS

The  Company  provided  travel  and  entertainment  expenses  to its executive
officers  and key employees.  The aggregate amount of such compensation, as to
any executive officer or key employee, did not exceed the lesser of $25,000 or
10%  of  the cash compensation paid to such executive officer or key employee,
nor did the aggregate amount of such other compensation exceed 10% of the cash
compensation  paid  to  all  executive  officers  or key employees as a group.

TERMINATION  AND  CHANGE  IN  CONTROL  ARRANGEMENTS

In  July  1993,  the Board of Directors adopted a severance plan for executive
officers providing that, in the event of termination of employment as a result
of  a  change in control of the corporation, that such executive officer would
receive  severance in the amount of one year's base salary.  The Plan does not
provide  for  any  severance  in  the  event of the resignation, retirement or
termination of any Executive Officer's employment with the Company for reasons
other  than  a  change  in  control  of  the  Company.

<PAGE>
ITEM  10  -  EXECUTIVE  COMPENSATION  (Continued)
             -----------------------

COMPENSATION  OF  DIRECTORS

Under  the  Directors  Stock  Compensation  Plan in effect until May 31, 1994,
described  in  Item 12, each of the non-employee directors of the Company were
compensated  in  the  amount  of  $700 per month, payable in lieu of cash, the
award  of equivalent shares of common stock of the Company.  In February 1994,
99,600  shares  of  common  stock were distributed to each of the non-employee
directors  for  services rendered for the period May 1, 1992 through September
30,  1994.  In February 1995, the balance of 50,400 shares were distributed to
each  of  the  six non-employee directors for services rendered for the period
October  1993  through  May  1994.


ITEM  11  -  SECURITY  OWNERSHIP  OF  BENEFICIAL  OWNERS  AND
             ------------------------------------------------
               MANAGEMENT
               ----------

The  following  table lists the beneficial ownership, as of February 27, 1997,
of  the Company's common stock with respect to all directors and officers as a
group,  to  the  extent  that  it  is  known  to  the  Company, either through
Securities  Exchange  Act  filings, Company records or information supplied by
the  persons  named  in  the  table.
<TABLE>
<CAPTION>


Name and Address                     Amount and Nature
  of Beneficial Owner             of Beneficial Ownership   Percent of Class
---------------------             ------------------------  -----------------
<S>                    <C>        <C>                       <C>

David G. Davidson         28,000                       (2)               .33%
Paul L. Howard           692,595                       (3)              8.17%
Everett L. Hodges        747,478                    (2)(4)              8.78%
Morris V. Hodges         817,291                    (2)(5)              9.65%
                       ---------                            -----------------

                       2,282,364                       (1)             26.93%
                       =========                            =================
<FN>

(1)     All directors and officers, as a group, including persons named above.

(2)     Messrs. David G. Davidson, Everett L. Hodges and Morris V. Hodges were
each  granted 16,600 and 8,400 shares of the Company stock under the Directors
Stock  Compensation  Plan  on  February  14,  1994  and  February  19,  1995,
respectively.    See  "Executive  Compensation  -  Compensation of Directors."

(3)     The 692,595 shares beneficially held by Paul L. Howard are held in the
Howard  Family  Trust.    See  "Executive  Compensation  -  Compensation  of
Directors."
</TABLE>



<PAGE>
ITEM  11  -  SECURITY  OWNERSHIP  OF  BENEFICIAL  OWNERS  AND
             ------------------------------------------------
               MANAGEMENT  (Continued)
               ----------

(4)          The 744,478 shares beneficially held by Everett L. Hodges include
587,896  shares  held  of record jointly in the Everett L. Hodges  and Mary M.
Hodges  Trust.    This  amount  also  includes  43,400 shares held directly by
Everett  L.  Hodges, 83,182 shares held of record by Energy Production & Sales
Co.,  Inc.  (EPS), and 30,000 shares held by California Oil Independents, Inc.
The 744,478 shares do not include 80,416 shares held in trust for the children
and  grandchild  of  Everett  L.  and Mary M. Hodges, as to which Mr. and Mrs.
Everett  L.  Hodges  disclaim any beneficial ownership.  Everett L. Hodges and
Morris  V.  Hodges,  as  a  group, may be deemed to be a controlling person of
Petrominerals  by virtue of their share ownership. See "Executive Compensation
-  Compensation  of  Directors."  Everett L. Hodges and Morris V. Hodges, as a
group,  may be deemed to be a controlling person of Petrominerals by virtue of
their  share  ownership.

(5)          The  817,291 shares beneficially held by Morris V. Hodges include
734,109  shares  held of record jointly in the Morris V. Hodges and Kathryn M.
Hodges  Trust.    This  amount  also  includes 83,182 shares held of record by
Sunset  Pipeline  and Terminalling, Inc.  The 817,291 shares beneficially held
by  Morris  V. Hodges  do not include 149,235 shares held by adult children of
Morris  V.  Hodges  and  Kathryn M. Hodges, as to which Mr. and Mrs. Morris V.
Hodges  disclaim  any  beneficial  ownership.  See  "Executive  Compensation -
Compensation  of  Directors."  Everett  L.  Hodges  and Morris V. Hodges, as a
group,  may be deemed to be a controlling person of Petrominerals by virtue of
their  share  ownership.

COMPENSATION  OF  DIRECTORS

During  the  year  ended  December  31,  1996,  each of the three non-employee
directors who held office the entire year were paid $350 per month for a total
of  $4,200 each.  Mr. Howard, who became President and Chief Executive Officer
on  March  24, 1995, received a $7,500 per month fee (as previously noted) for
his  services.  In  addition,  the  non-employee  directors are reimbursed for
reasonable  expenses  incurred  in  connection  with  any  meetings.

Under  the  Directors  Stock  Compensation  Plan in effect until May 31, 1994,
described  below,  each  of  the  non-employee  directors  of the Company were
compensated  in  the  amount  of  $700 per month, payable in lieu of cash, the
award  of equivalent shares of common stock of the Company.  In February 1994,
99,600  shares  of  common  stock were distributed to each of the non-employee
directors  for  services rendered for the period May 1, 1992 through September
30,  1994.  In February 1995, the balance of 50,400 shares were distributed to
each  of  the  six non-employee directors for services rendered for the period
October  1993  through  May 1994, at which time the Plan terminated, as all of
the  shares  had  been distributed.  This Plan provided that each non-employee
director  was  compensated by an award of shares of the Company's common stock
valued  at $700 per month, the actual number of shares to be calculated at the
average market price of the Company's common stock for the month preceding the
award  or  the  net book value of the Company, expressed on a per-share basis,
whichever  is greater.  Under this Plan, the directors' compensation in shares
was  in  lieu  of  cash  payments.

<PAGE>
ITEM  11  -  SECURITY  OWNERSHIP  OF  BENEFICIAL  OWNERS  AND
             ------------------------------------------------
               MANAGEMENT  (Continued)
               ----------

COMPENSATION  OF  DIRECTORS  (Continued)

The  Company  did  not  pay  any  additional  fees to directors for serving as
members of the Audit, Ad-Hoc or Compensation Committees during the last fiscal
year.

1993  INCENTIVE  STOCK  OPTION  PLAN  AND 1993 NON-STATUTORY STOCK OPTION PLAN

The  Company  has  in effect two stock option plans - the 1993 Incentive Stock
Option  Plan (the Incentive Plan) and the 1993 Non-Statutory Stock Option Plan
(the  Non-Statutory  Plan)  (the Incentive Plan and the Non-Statutory Plan are
sometimes collectively referred to herein as the Plans), which were adopted by
the  Board  of  Directors  and  approved by the shareholders of the Company in
1993.    The  Plans  in  the  aggregate provide for the granting of options to
purchase  a  maximum  of  1,200,000  shares  of  the Company's common stock to
employees and directors of the Company and its affiliates (as defined herein);
however, options which may be granted to non-employee directors are limited to
a  maximum  of  60,000  shares.    The  Plans  expire  on  February  8,  2003.

Any of the Company's current or future employees who render, in the opinion of
the  Board  of  Directors,  the  type  of  services  which  tend to contribute
materially  to  the  success of the Company or an affiliate of the Company are
eligible to participate in the Incentive Plan. Any of the Company's current or
future  employees  or  directors  (whether  or  not  otherwise employed by the
Company)  who  render,  in  the opinion of the Board of Directors, the type of
services  which tend to contribute materially to the success of the Company or
an  affiliate  of the Company are eligible to participate in the Non-Statutory
Plan.

The  Plans are administered by the Board of Directors of the Company which has
the  authority to determine the employees and directors to whom options are to
be  granted,  the number of shares subject to each option price of outstanding
options  (but  not below the fair market value of the shares subject thereto),
to  enter  into  agreements relating to the value of the option at the date of
grant,  and  to  make  all  other determinations necessary or advisable to the
administration  of  the  Plan.  With the consent of the optionee, the Board of
Directors  will also have the power to substitute options with different terms
for  previously  granted  options,  or  to  amend  the  terms  of  any option.


<PAGE>
ITEM  11  -  SECURITY  OWNERSHIP  OF  BENEFICIAL  OWNERS  AND
             ------------------------------------------------
               MANAGEMENT  (Continued)
               ----------

1993  INCENTIVE  STOCK  OPTION  PLAN  AND 1993 NON-STATUTORY STOCK OPTION PLAN
(Continued)

The  Board of Directors may delegate administration of the Plan to a committee
composed  of  not  less  than  three  members  of  the  Board  of  Directors.
Administration  of  the  Plan with respect to committee members, however, just
remain vested in the Board. With respect to options granted to a director, the
Board of Directors shall take action by a vote sufficient without counting the
vote  of  the  interested  director.  Interested  directors  may be counted in
determining  the  presence  of  quorum  at a meeting of the Board of Directors
which  authorized  the  granting  of  options  to  such  directors.

On  October  7, 1993, Mr. Butler was granted an option under the Non-Statutory
Stock  Option Plan to purchase up to 500,000 shares of the common stock of the
Company at a price of $.70 per share. Mr. Butler has not exercised his option.

1993  STOCK  BONUS  PLAN

In  February  1993,  the  Board  of Directors adopted the Company's 1993 Stock
Bonus  Plan (Bonus Plan). The Bonus Plan provides the awarding of up to 50,000
shares  of  the  Company's  common  stock to officers and key employees of the
Company.  The  Plan  is  administered  by the Board of Directors which has the
authority  to  determine  the officers and key employees to whom stock bonuses
are  to  be awarded, the time or times at which stock bonuses will be awarded,
and, subject to the limits discussed below, the number of shares to be granted
under  each  award.  The  Board  of  Directors  has  the power to delegate the
administration  of  the  Bonus  Plan  to a committee of the Board appointed in
accordance  with  the  Company's  Bylaws.  The  aggregate  fair  market  value
(determined  as of the date of grant) of the shares of common stock awarded to
any  officer  or  key  employee  under the Bonus Plan in any one calendar year
cannot  exceed  one-sixth of the officer's or key employee's salary (excluding
bonuses  and awards under other incentive plans maintained by the Company) for
such  calendar  year.  The Bonus Plan terminates on February 8, 1998. No stock
bonus  awards  were  made  to  officers or key employees of the Company during
1995.


<PAGE>
ITEM  11  -  SECURITY  OWNERSHIP  OF  BENEFICIAL  OWNERS  AND
             ------------------------------------------------
               MANAGEMENT  (Continued)
               ----------

DIRECTORS  STOCK  COMPENSATION  PLAN

On  April  16,  1992,  as  part  of its cost containment program, the Board of
Directors  of  the  Company adopted the Directors Stock Compensation Plan (the
Stock  Compensation  Plan).  The  Stock  Compensation  Plan  provides  for the
granting  of  stock to non-employee directors of the Company in lieu of paying
director's  fees  in  cash.  The  purpose of the Stock Compensation Plan is to
minimize  cash outflow from the Company by compensating non-employee directors
for  their  services  to the Company in stock rather than in cash. The maximum
number  of  shares  provides  for the Stock Compensation Plan is 150,000. Only
non-employee directors of the Company are eligible to participate in the Stock
Compensation  Plan.  In  February  1994  and  February 1993, a distribution of
16,600  shares and 8,400 shares was made to each of the non-employee directors
under  this  Plan, respectively. This Plan terminated on February 10, 1995, at
which  time  all  of  the  shares  issued  under this Plan were distributed to
non-employee  directors.

The  Stock  Compensation  Plan is administered by the disinterested members of
the  Board,  or,  in  the  event  there are none such, the President and Chief
Executive  Officer  and  the  Secretary  of the Company. The granting of stock
under the Stock Compensation Plan is according to a pre-set formula. Directors
fees payable to non-employee directors of the Company under this plan were set
by  the  Board  at  $700  per  month.  Under  the Stock Compensation Plan, the
eligible  directors received stock at a value of $700 per month, determined by
the  average  trading  price  as quoted on the nasdaq Small Cap System for the
calendar  month immediately preceding the month in which the directors fees is
earned;  provided,  however, that the valuation of the stock shall not be less
than  the  net  book  value  of  the  Company  expressed on a per share basis.
Certificates  evidencing the shares shall be distributed to eligible directors
quarterly.  These  shares  shall  be  restricted shares, subject to a two year
holding  period.

OPTION/SAR  GRANTS  IN  LAST  FISCAL  YEAR

The  Company  did  not  grant any stock options under the 1993 Incentive Stock
Option  Plan, the 1993 Non-Statutory Stock Option Plan or the 1993 Stock Bonus
Plan  during  the  last  fiscal  year.

REPORTABLE  TRANSACTIONS

To  the  knowledge  of  the  Company,  as  of February 26, 1996, all reporting
persons  have  properly  filed  the  appropriate  forms  on  all  reportable
transactions  and all forms were timely filed in compliance with Section 16(a)
of  the  Exchange  Act.


<PAGE>
ITEM  12  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
             --------------------------------------------------

TRANSACTIONS  WITH  MANAGEMENT  AND  OTHERS

During  the last fiscal year, the Company has been involved in various related
party  transactions  with  certain  Directors  of  the  Company,  or  entities
controlled or affiliated with such individuals. The following table sets forth
the  relationship,  through ownership of securities, between Petrominerals and
the  following  individuals  and  entities:
<TABLE>
<CAPTION>
<S><C>

Name                    Beneficial Owner        Percentage Owned
-------------------  ----------------------  -----------------------
Petrominerals 96-1,       General Partner:
a Limited Partnership        Petrominerals              1.00%
                          Limited Partners:
                             Paul L. Howard            23.21%
                             Morris V. Hodges          17.86%
                             David G. Davidson         17.86%
                             Unrelated parties         40.07%
                                                      -------
                                   TOTAL              100.00%
                                                      =======

Petrominerals 81-1,       General Partner:
a Limited Partnership        Petrominerals              6.78%
   (Partnership)          Limited Partners:
                             EPS                       33.90%
                             Morris V. Hodges           2.26%
                             Paul L. Howard             2.26%
                             Unrelated parties         54.80%
                                                      -------

                                    TOTAL             100.00%
                                                      =======

Terra-Therme II              Petrominerals             19.13%
(formerly the                Paul L. Howard             9.56%
Newberry Partnership),       Unrelated parties         71.31%
                                                      -------
a general partnership
(Terra-Therme II)                   TOTAL              100.00%
                                                       =======
</TABLE>


Petrominerals  96-1  Limited  Partnership
-----------------------------------------

The  Petrominerals  96-1  Limited Partnership was formed in December 1996, for
the  purpose  of  drilling a well on the Company's Mabel Strawn oil lease. The
Company  entered  into  a  joint  venture  agreement  with the partnership and
assigned  the  drill  site  to  the  joint  venture.


<PAGE>
ITEM  12  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
             --------------------------------------------------
(Continued)

Petrominerals  96-1  Limited  Partnership  (Continued)
-----------------------------------------

The partnership contributed $280,000 to cover the intangible costs of drilling
the  well  and  the  Company  provided  the drill site and well casing under a
turnkey drilling contract. The Company also provided all of the other tangible
equipment  needed  to  produce the well under a lease agreement, proceeds from
the  working  interest  will  be paid 90% to Petrominerals 96-1 and 10% to the
Company  until payout, and thereafter 30% to Petrominerals 96-1 and 70% to the
Company.  The Company will receive $2,400 per month for leased equipment until
payout  and  $400  thereafter.  The Company will also receive a $350 per month
management  fee  as general partner. Payout is expected to occur in 24 months.

Petrominerals  81-1  Limited  Partnership
-----------------------------------------

The  Petrominerals 81-1 Limited Partnership was formed in 1981 for the purpose
of  drilling  one development well on the Company's McGillivrae Lease, located
on  the  Hasley  Canyon  field,  Santa  Clarita  Valley,  Los  Angeles County,
California,  and  two development wells on the Field Fee Lease, located on the
Cat  Canyon field, Santa Barbara County, California. The Limited Partners were
granted  options  to participate in the drilling of one additional well on the
McGillivrae  Lease  and  two  additional  wells  on  the  Field  Fee  Lease.
Petrominerals,  as General Partner, elected to exercise its option to purchase
the interest in the McGillivrae No. 3 well for a cash consideration of $8,161.
An  Option  Agreement  for  the  purchase  of  the  McGillivrae No. 3 well was
executed  on  July  1,  1988.

Petrominerals,  as  General  Partner,  has  contributed  $104,067  to  the
Partnership,  which  represents  approximately  seven  percent  (7%)  of  the
aggregate contributions to the Partnership's capital, and the limited partners
have  contributed $1,443,277 to the Partnership. Petrominerals will receive or
be  charged  with  its  proportionate  share of each item of the Partnership's
income,  gain,  expense,  deduction,  loss  or credit; provided, however, that
Petrominerals  bears  100% of the losses incurred by the Partnership after the
loss  exceeds  the  capital contributions of the limited partners. During 1993
and  1994,  Petrominerals  did  not  receive  any  income from the Partnership
options  and  realized  $3,986  in  overriding  royalty  interests.


<PAGE>
ITEM  12  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
             --------------------------------------------------
(Continued)

Petrominerals  81-1  Limited  Partnership  (Continued)
-----------------------------------------

The Partnership contributed the funds for the intangible costs of drilling the
wells.  Until  the Partnership received 110% of its investment in all ventures
(payout),  the  Partnership  will  receive  176%  and  110%  of  the  revenues
attributable  to  the  working  interest  in  the first and second McGillivrae
wells,  respectively,  and  Petrominerals, as General Partner, receives a five
percent  (5%)  overriding  royalty  on  the  McGillivrae Lease. Petrominerals'
overriding  royalty  terminates after payout, at which time Petrominerals will
receive  65% of the net revenues attributable to the working interest, and the
Partnership will receive the remaining 35% of the net revenues attributable to
the  working  interest.

The  McGillivrae  No.  3  Partnership  well was completed during 1982, and the
McGillivrae  No.  2  well was completed during 1983. The Partnership redrilled
the  McGillivrae  No.  3  well  during  1985.

Petrominerals  has  recognized  a  total  of  $1,197,000,  in  payment for its
services  under  the  Partnership  drilling  contracts.  In addition to income
derived  from  its  overriding royalties, working interests and drilling fees,
Petrominerals  received operator and equipment lease fees which totaled $7,800
during  1995.

Terra-Therme  II
----------------

Terra-Therme  II,  a general partnership, was formed in November 1982, for the
purpose  of acquiring and owning interests in geothermal leases located in the
Newberry  Crater  area  of the Deschutes National Forest in Central Oregon. In
addition to their interest in Terra-Therme II, the Company and Paul L. Howard,
individually,  held interests in lease options to acquire approximately 17,000
acres  and  15,000  acres,  respectively, of geothermal leases in the Newberry
Crater  area.

In  June  1991,  Vulcan  Power Company (Vulcan) entered into negotiations with
representatives  of Petrominerals and Terra-Therme II Partnership with respect
to  Vulcan  purchasing certain rights in the Newberry Crater geothermal leases
formerly  held by another party. Vulcan formed a new joint venture partnership
entity  known  as  Vulcan  Pacific,  in  which  Vulcan acts as operator of the
interest  it  acquired.


<PAGE>
ITEM  12  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
             --------------------------------------------------
(Continued)

TRANSACTIONS  WITH  MANAGEMENT  AND  OTHERS  (Continued)

Terra-Therme  II  (Continued)
----------------

Vulcan  purchased  its interests in the Newberry Crater properties for a total
investment  of less than $500,000, plus approximately 120,000 shares of Vulcan
Class A common stock. Petrominerals received $11,915 in cash and 44,943 shares
of  Vulcan  Class  A common stock for a carried interest in the development of
this property. The Terra-Therme II Partnership retain a 1% net profit interest
in  certain  of  the  properties  in  the  Newberry  site.  In  addition,  the
Terra-Therme Partnership retains a 0.6% overriding royalty interest on certain
remaining  properties  it  acquired from Vulcan. The Company retains a 19.125%
interest  and  Mr.  Howard  retains  a  9.563% interest in the Terra Therme II
Partnership.

Sale  of  Long  Beach  Facility
-------------------------------

On  May 16, 1995, Hydro-Test International (HTI), a wholly owned subsidiary of
Petrominerals,  entered into an agreement with Everett L. Hodges and Morris V.
Hodges,  two  of the directors of Petrominerals, to purchase the assets of the
HTI  Long Beach, California, location for $260,000. These directors then began
doing  business with those assets as Hydro-Test Long Beach, LLC. Both, Everett
L.  Hodges  and  Morris V. Hodges, are directors of the Company (see Item 10).

Several  competitive bids were solicited by management before a final decision
was  made to sell these assets to Everett L. and Morris V. Hodges. The Hodges'
bid  was  ultimately  selected  because  it was the highest bid and was a cash
offer. Management feels that this sale represents an arm's length transaction.

Other  than  the transactions described above, no executive officer, director,
stockholder  known to the Company to own, beneficially or of record, more than
5% of the Company's common stock, or any member of the immediate family of any
of  those persons has engaged since the beginning of the Company's last fiscal
year  or  proposes  to  engage  in the future, in any transaction or series of
similar  transactions with the Company, directly through a separate entity, in
which  the  amount  involved  exceeded  or  will  exceed  $60,000.


<PAGE>
ITEM  12  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
             --------------------------------------------------
(Continued)

INDEBTEDNESS  OF  MANAGEMENT

During  the  Company's  last  fiscal year, no executive officer, director, any
member  of  the  immediate  family or any of those persons, any corporation or
organization  for  which any of those persons serve as an executive officer or
partner  or  which  they  own directly or indirectly 10% or more of its equity
securities,  or  any  trust  or  other  estate  in  which any of the Company's
executive  officers or directors have a substantial beneficial interest or for
which  they  serve as a trustee or in a similar capacity, has owed the Company
at  any  time  since  the beginning of its last fiscal year more than $60,000.


<PAGE>
                                    PART IV
                                    -------

ITEM  13  -  EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES  AND  REPORTS
             --------------------------------------------------------
               ON  FORM  8-K
               -------------
<TABLE>
<CAPTION>


                                                                     Page(s)
                                                                     -------
<S>  <C>                <C>                                                <C>

A.  LIST OF DOCUMENTS
    -----------------                                                           
    1.  Consolidated Financial Statements
        --------------------------------------------------------         

           The following consolidated financial statements of
            Petrominerals are included in Part II, Item 7:

           Report of Brown Armstrong Randall & Reyes,
            Independent Auditor's Report                                21-22

           Consolidated Balance Sheet at December 31, 1996 and 1995     23-24

           Consolidated Statements of Operations for the Years
            Ended December 31, 1996 and 1995                               25

           Consolidated Statements of Shareholders' Equity for
            the Years Ended December 31, 1996 and 1995                     26

           Consolidated Statements of Cash Flows for the Years
            Ended December 31, 1996 and 1995                               27

           Notes to Consolidated Financial Statements                   28-45
</TABLE>


     2.          Financial  Statement  Schedules
                 -------------------------------

     The  financial  statement  schedules  of  the  Company filed herewith are
listed  below.   Schedules not included have been omitted because they are not
applicable  or the required information as shown in the consolidated financial
statements  and  notes  thereto.

          Schedules  for  the  Years  Ended  December  31,  1996  and  1995:

     Schedule  II  -  Valuation,  Qualifying  Accounts
            and  Reserves                                                  62


<PAGE>
ITEM  13  -  EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES  AND  REPORTS
             --------------------------------------------------------
               ON  FORM  8-K  (Continued)
               -------------
     3.  Reports  on  Form  8-K
         ----------------------
         None.
     4.  Exhibits
         --------
          (2)(a)  Order Approving Disclosure Statement and Fixing Time for
Filing  Acceptances  and  Rejections  of Plan and Fixing Date for Confirmation
Hearing  for  Hydro-Test  International,  Inc.(1)

          (2)(b)  Supplemental Hydro-Test International, Inc. Chapter 11
Disclosure  Statement(1)

          (2)(c)  Supplemental Hydro-Test International, Inc. Chapter 11 
Plan(1)
          (3)(a)  Certificate  of  Incorporation(2)
          (3)(a)(i)  Amendment  of  Certificate  of  Incorporation(3)
          (3)(b)  Bylaws,  as  Amended(3)
          (10)(a)  Petrominerals Corporation 1993 Incentive Stock Option
Plan  and  1993  Non-Statutory  Stock  Option  Plan  Incorporation(4)

          (10)(b)  Form of Petrominerals Corporation Employee Stock Option
Agreement(4)

          (10)(c)  Petrominerals Corporation 1993 Employee Stock Bonus
Plan(5)
          (10)(d)  Petrominerals Corporation Directors Stock Compensation
Plan(6)
          (21)  Subsidiaries  of  the  Registrant

(1)          Incorporated  herein  by  reference  to Exhibit of same number in
Registrant's  Annual Report on Form 10-K for the year ended December 31, 1995.

(2)          Incorporated  herein  by  reference  to Exhibit of same number in
Registrant's  Annual Report on Form 10-K for the year ended December 31, 1981.

(3)          Incorporated  herein  by  reference  to Exhibit of same number in
Registrant's  Annual Report on Form 10-K for the year ended December 31, 1987.

(4)          Incorporated  herein  by  reference  to Form S-8 Registration No.
33-70690,  as filed with the Securities and Exchange Commission on October 22,
1993.

(5)          Incorporated  herein  by  reference  to Form S-8 Registration No.
33-70688,  as filed with the Securities and Exchange Commission on October 22,
1993.

(6)          Incorporated  herein  by  reference  to Form S-8 Registration No.
33-70692,  as filed with the Securities and Exchange Commission on October 22,
1993.


<PAGE>
                           PETROMINERALS CORPORATION
           SCHEDULE II - VALUATION, QUALIFYING ACCOUNTS AND RESERVES
                 YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994




<TABLE>
<CAPTION>

                                        Additions

                                  Balance at   (Recoveries)        Balance
                                   Beginning    Charged             at End
                                   of Period    to Income          of Period
                                -------------   ---------------    ---------
                                               (in thousands)
<S>                         <C>   <C>          <C>            <C>  <C>     <C>

Valuation allowance on oil
  and gas properties

                          1996  $    10,963  $          -      $        10,963
                                ===========  =============     ===============

                          1995  $    10,963  $           -     $        10,963
                                ============ ==============    ===============

</TABLE>



<TABLE>
<CAPTION>

                                            (Additions)
                              Balance at    Recoveries       Balance
                              Beginning        Posted        at End
                              of Period       to Income     of Period
                              ------------  ---------------  ---------
                                            (in thousands)
<S>                     <C>   <C>          <C>              <C>         <C>

Allowance for doubtful
  receivable

                        1996  $        66  $        37      $            29
                              ===========  ============     ===============

                        1995  $        25  $       (41)     $            66
                              ===========  ============     ===============

</TABLE>



<PAGE>
                                  SIGNATURES




Pursuant to the requirements of Section 13 or 15(d) 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.

     PETROMINERALS  CORPORATION
     (Registrant)



____________________,  1997          By:_______________________________________
                                       Paul  L.  Howard,
                                       President  and  Chief  Executive  Officer


Pursuant  to  the  requirements  of  the Securities Exchange Act of 1934, this
Report  has  been  signed  below  by  the  following  persons on behalf of the
Registrant  and  in  the  capacities  and  on  the  dates  included:


____________________,  1997          By:_______________________________________
                                       Paul  L.  Howard,
                                       President  and  Chief  Executive  Officer

____________________,  1997          By:_______________________________________
                                       David  G.  Davidson,  Director



____________________,  1997         By:________________________________________
                                      Everett L. Hodges, Director


____________________,  1997          By:_______________________________________
                                      Morris  V.  Hodges,
                                      Assistant  Secretary  and  Director


<PAGE>


                                   EXHIBITS


<PAGE>

                                  EXHIBIT 21


                        SUBSIDIARIES OF THE REGISTRANT


<PAGE>
1.          Hydro-Test  International,  Inc.