UNITED STATES

                SECURITIES AND EXCHANGE COMMISSION

                     Washington, D. C.  20549

                            Form 10-Q

[x] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

For quarter ended        September 30, 1998                
                               or
[ ] Transition Report Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934

For the transition period from                   to               
Commission File Number:         2-70390                           

              SANCHEZ-O'BRIEN 1981-A DRILLING COMPANY    
      (Exact name of registrant as specified in its charter)

           TEXAS                                         74-2216121 
(State or other jurisdiction of              (IRS employer
incorporation or organization)               identification no.)

5847 San Felipe, Suite 1900      Houston, Texas     77057         
(Address of principal executive offices)       (Zip Code)

                           (713) 783-8000                         
           (Registrant's telephone number, including area code)

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

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities  Exchange  Act of 1934 during the preceding 12 months
(or for such shorter period that  the registrant was required to
file such reports), and (2) has been  subject  to such filing
requirements for the past 90 days.  Yes  X   No  

               APPLICABLE ONLY TO ISSUERS INVOLVED
                 IN BANKRUPTCY PROCEEDINGS DURING
                    THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or
15(d) of the Securities  Exchange  Act of 1934 subsequent to the
distribution of securities under a plan confirmed by court. 
Yes      No  

              APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
<PAGE>
             SANCHEZ-O'BRIEN 1981-A DRILLING COMPANY
           QUARTERLY REPORT ON FORM 10-Q SEPTEMBER 30, 1998


                              INDEX

                                                                 
PART I -  Financial information:

 Item 1. Financial Statements
         Balance Sheets for the periods September 30, 1998 and
            December 31, 1997
         Statements of Operations for the nine months ended
            September 30, 1998 and 1997
         Statement of Partners' Equity as of September 30, 1998
         Statements of Cash Flow for the nine months ended
            September 30, 1998 and 1997
 Item 2. Management's Discussion and Analysis of Financial 
           Condition and Results of Operations
 
  
PART II - Other information:
 
 Item 1. Legal Proceedings
 Item 2. Changes in Securities (not applicable) 
 Item 3. Defaults upon Senior Securities (not applicable) 
 Item 4. Submission of Matters to a Vote of Security Holders
            (not applicable) 
 Item 5. Other Information (not applicable) 
 Item 6. Exhibits and Reports on Form 8-K
         Signatures
<PAGE>

<TABLE>
                     Part I.  Financial Information

ITEM 1.  FINANCIAL STATEMENTS

                  Sanchez-O'Brien 1981-A Drilling Company
                          (a limited partnership)
                              Balance Sheets
                                (Unaudited)
<CAPTION>
                                             September 30,      December 31,
                                                     1998            1997     
<S>                                               <C>            <C>
  ASSETS

Current assets:
  Cash                                           $   948,752          665,680 
  Accounts receivable                                 27,151           48,333 

       Total current assets                          975,903          714,013 

Oil and natural gas properties (full cost        
  method), at cost, pledged (note 2)              31,016,515       31,043,318 
Less accumulated depreciation, depletion
  and amortization (note 2)                       30,448,924       30,376,924 

       Net oil and natural gas properties            567,591          666,394 

Organization costs, less applicable
  amortization                                             0                0 
                                                   1,543,494        1,380,407 
<CAPTION>
<S>                                               <C>               <C> 
LIABILITIES AND PARTNERS' EQUITY

Current liabilities:
  Accounts payable                                    50,000           53,074 
  Suspense payable-investors                         180,555          184,470 
  
       Total current liabilities                     230,555          237,544 

Partners' equity:
  Limited partners                                 1,299,810        1,131,439 
  General partner                                     13,129           11,424 

       Total partners' equity                      1,312,939        1,142,863 
                                                 $ 1,543,494        1,380,407 
See accompanying notes to financial statements.<PAGE>
<PAGE>

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<TABLE>
             Sanchez-O'Brien 1981-A Drilling Company
                     (a limited partnership)
                     Statements of Operations
                           (Unaudited)

                                             Nine Months Ended
                                                September 30,      
                                              1998          1997  
<CAPTION>
<S>                                        <C>           <C>
REVENUES:
  Oil and natural gas sales                 $357,038      560,838
  Interest income                             17,406       15,704
  Other income                                     0            0

                                             374,444      576,542

EXPENSES: 
  Operating expenses                          96,379      112,474
  General and administrative                  35,989       46,516
  Interest                                         0            0
  Depreciation, depletion
    and amortization (note 2)                 72,000      113,000

                                             204,368      271,990

    Net income                              $170,076      304,552


See accompanying notes to financial statements.
<PAGE>

</TABLE>
<TABLE>

<PAGE>
                  Sanchez-O'Brien 1981-A Drilling Company
                          (a limited partnership)
                       Statement of Partners' Equity
                    Nine Months Ended September 30, 1998
                                (Unaudited)

                                         Limited       General 
                                        Partners       Partner        Total   
<CAPTION>
<S>                                    <C>             <C>         <C>
Balances at December 31, 1997          $1,131,439       11,424      1,142,863 

Cash distributions                              0            0              0 

Net income                                168,371        1,705        170,076

Balances at September 30, 1998         $1,299,810       13,129      1,312,939 

See accompanying notes to financial statements.
<PAGE>

</TABLE>
TABLE
<PAGE>
         Sanchez-O'Brien 1981-A Drilling Company
                          (a limited partnership)
                         Statements of Cash Flows
                                (Unaudited)
                                                    Nine Months Ended 
                                                      September 30,    
                                                      1998        1997 
<CAPTION>
<S>                                                <C>            <C>
Cash flows from operating activities:
 Net income                                       $ 170,076        304,522 
 Adjustments to reconcile net earnings to net
   cash provided by operating activities:
     Depreciation, depletion and
          amortization                               72,000        113,000 
     Change in assets and liabilities:
      Accounts receivable                            21,182         60,377 
      Accounts payable                               (3,074)        71,229 
      Suspense payable                               (3,915)        (6,445) 
           
       Total adjustments                             86,193        238,161 

        Net cash provided by operating 
         activities                                 256,269        542,713 

Cash flows from investing activities:
 Cash distributions                                    -              -    
 Purchases of property and equipment                 26,803        (83,695)

       Net cash used in investing
          activities                                 26,803        (83,695)

Cash flows from financing activities:
  Payment of long-term debt                               0              0 
  Proceeds from long-term debt                            0              0 

        Net cash provided (used) by financing
         activities                                       0              0 

Net increase in cash and cash equivalents           283,072        459,018 

Cash and cash equivalents at beginning of
 year                                               665,680        501,298 

Cash and cash equivalents at end of
 quarter                                           $948,752        960,316 

See accompanying notes to financial statements.

<PAGE>
             Sanchez-O'Brien 1981-A Drilling Company
                     (a limited partnership)

                  Notes to Financial Statements

                           September 30, 1998

                           (Unaudited)

(1)   Organization and Summary of Significant Accounting Policies

    a.Organization

      Sanchez-O'Brien 1981-A Drilling Company (the Drilling
      Company), is a Texas limited partnership formed on
      December 18, 1980.  Sanchez-O'Brien Drilling Corporation
      is the General Partner and an Organizational Limited
      Partner of the Drilling Company and has a 1% interest
      therein.

      The Drilling Company was initially formed with an
      Organizational Limited Partner on December 18, 1980.  Upon
      the closing of subscriptions on June 23, 1981, with 3,207
      Limited Partners contributing $26,520,000, the
      Organizational Limited Partner was refunded his initial
      contribution.  In June, 1981, the Drilling Company entered
      into a separate agreement to form a general partnership,
      Sanchez-O'Brien 1981-A Drilling Partnership (the Drilling
      Partnership), with Sanchez-O'Brien Oil & Gas Corporation
      (Sanchez-O'Brien) as Managing General Partner.  The
      purpose of the Drilling Partnership is to conduct oil and
      natural gas exploration activity in the continental United
      States.  Sanchez-O'Brien Drilling Corporation is a wholly
      owned subsidiary of Sanchez-O'Brien.

    b.Basis of Financial Statement Presentation

      The financial statements include the accounts of the
      Drilling Company and its proportionate share in the
      specific assets, liabilities and operating accounts of the
      Drilling  Partnership.  All significant intercompany
      balances have been eliminated.

<PAGE>
    
    c.General

      The financial statements included herein were prepared by
      the Managing General Partner.  In the opinion of
      management, all adjustments have been made which are
      necessary for a fair presentation of the financial
      position of the Drilling Company at June 30, 1998 and the
      results of operations for the period then ended.

(2)   Oil and Gas Properties

      The Drilling Company follows the full cost method of
      accounting for its proportionate interest in the oil and gas
      operations of the Drilling Partnership.  Under this method,
      all costs incurred in the acquisition, exploration and
      development of properties, including costs of surrendered and
      abandoned leaseholds, delay lease rentals and dry holes, are
      capitalized.  Dispositions of oil and gas properties are
      accounted for as adjustments to capitalized costs, with no
      gain or loss recognized.  Depreciation, depletion and
      amortization of oil and gas properties is provided by the
      units-of-production method based on proved oil and gas
      reserves.

  Under the full cost method of accounting for oil and gas
  operations, capitalized costs of oil and gas properties are
  not to exceed the present value of future net revenues from
  estimated production of proved oil and gas properties plus the
  lower of cost or estimated fair market value of unproved
  properties.  If capitalized costs exceed this limitation, an
  additional provision is to be made to depreciation, depletion
  and amortization.

(3)Notes Payable

  As of September 30, 1998, The Drilling Company does not have any
  debt.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
       AND RESULTS OF OPERATIONS.

  As of September 30, 1998, forty-three wells have been drilled.
  Of this number, nine wells are commercially productive,
  twenty-four were dry holes or have been depleted and
  abandoned, seven have been sold and three are shut-in.

  As of September 30, 1998, the Drilling Company's share of capital
  expenditures of the Drilling Partnership were in excess of the
  available funds of the Drilling Company.  Financing of these
  expenditures was provided through borrowings from the Managing
  General Partner. 

  As of September 30, 1998, each Limited Partner has received $435
  per each $5,000.  Future distributions will be made after
  litigation on the S. W. Escobas (Trevino leases) has been settled.
<PAGE>
                    PART II. Other Information

ITEM 1. LEGAL PROCEEDINGS

  The litigation against Pennzoil Exploration and Production Company
  (Pennzoil) and Sanchez-O'Brien on the Trevino lease in the S.W. 
  Escobas Prospect is ongoing.  The interests in the Trevino lease,
  which comprise part of the S.W. Escobas Prospect, were acquired
  from Pennzoil.  There are currently four producing wells on the
  Trevino Leases, in which the Drilling Partnership holds between 22.53%-
  23.177% gross working interest.  The interest in dispute in this lawsuit is
  7/96 or 7.29% of Sanchez and Pennzoil's interest.  The trial judge, on
  November 9, 1992, ruled in favor of the defendants, Pennzoil and
  Sanchez.  The plaintiffs appealed the trial court ruling to the
  Court of Appeals for the Fourth District of Texas at San Antonio.  In May
  1994, the San Antonio Court of Appeals affirmed the trial court's judgment.
  The appellants (plaintiffs) filed an application for writ of error
  to the Texas Supreme Court after the Fourth District Court rejected
  a motion for a rehearing.  On November 6, 1994, the Texas Supreme
  Court denied the writ of error.  On December 8, 1994, plaintiffs
  filed a motion for a rehearing in the Texas Supreme Court.  The Texas
  Supreme Court granted a rehearing, and heard oral arguments during
  September 1995.  On October 18, 1996, the Texas Supreme Court reversed the
  judgments of both lower courts.  On November 20, 1996, a motion for
  rehearing was filed.  The Texas Supreme Court granted the motion for a 
  rehearing, but on February 26, 1998, The Texas Supreme court rendered an
  opinion reversing the San Antonio Court of Appeals and the trial court and
  rendering judgement for plaintiff.  A motion for a rehearing was filed in
  March 1998.  The Supreme Court has refused to rehear the case, essentially
  bringing finality to the case in favor of the plaintiffs.  Besides the 
  actual amounts owed, the defendents will also owe interest to the plaintiffs,
  although the respective start dates for the accrual of interest are still 
  being discussed.

  An unfavorable ruling would force the Drilling Company to forfeit the
  $252,417 currently being held in escrow.  In addition, the Drilling
  Company would lose approximately 7.29% of its interest in the Trevino
  properties, which would reduce the Drilling Company valuation by $21,595
  The total potential adverse effect would be $51.14 per each $5,000 limited
  partnership unit.
  
  Beginning June 1, 1992, Sanchez-O'Brien started escrowing the amounts in
  dispute in order to mitigate the effect to the Drilling Partnership and
  the Limited Partners.  The following is an estimate of the net financial
  effect of this litigation.

    a.   Revenues received and applicable interest

         The Drilling Partnership would have to remit to the
      plaintiffs 7.29% of revenues from the wells on the Trevino
      lease from May 1, 1987 less the applicable share of well costs
      and operating expenses.  The Drilling Partnership would also be
      responsible for any applicable interest.  The amount payable from
      the Drilling Partnership for net revenues and applicable interest is
      estimated to be $260,570, with $130,285 due from the Drilling Company,
      or Limited Partners.  Because this amount has already been paid out and
      used by the Drilling Company, the amounts would have to come from
      current and future revenues.  The net impact per each $5,000 limited
      partnership unit would be $24.32. 

    b.   Value of oil and gas revenues

         The plaintiffs would be entitled to future revenues to be
      derived from existing oil and gas revenues.  The net
      effect of losing these reserves at October 1, 1998 to the
      Drilling Partnership is estimated to be $43,192, with
      $21,595 being the interest of the Drilling Company, or
      Limited Partners.  The net impact per each $5,000 limited
      partnership unit would be $4.03.

    c.   Funds retained in escrow

         As mentioned, the Managing General Partner is currently
      escrowing the net revenues applicable to the disputed
      interest.  At July 1, 1998, the total Drilling Company
      funds being escrowed were $504,834, with $252,417 escrowed
      for the Drilling Company, or Limited Partners.  The net
      impact per each $5,000 limited partnership unit would be
      $47.11.  The Managing General Partner will continue to
      escrow the amounts in dispute.  If the plaintiffs were to
      prevail, the funds would be paid to the plaintiff. 
      However, if the defendants prevail, these additional
      amounts would be available to the Drilling Company for
      operations and/or distributions.
<PAGE>
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

  No reports on Form 8-K have been filed during the quarter for
  which this report is filed.



                            SIGNATURES

  Pursuant to the requirements of the Securities Exchange Act of
  1934, the registrant has duly caused this report to  be 
  signed  on its behalf by the undersigned thereunto duly
  authorized.


                       SANCHEZ-O'BRIEN 1981-A DRILLING COMPANY
                            (Registrant)

                       By Sanchez-O'Brien Drilling Corporation.
                            General Partner



     Date:  11/13/98   By:  M. M. FREEMAN                        
                            M. M. Freeman
                            Senior Vice President, Treasurer,
                            Secretary and Director (Principal
                            Financial Officer)



     Date:  11/13/98   By:  OLIVER GARZA                         
                            Oliver Garza
                            Vice President
                            Acctg./Administration

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