United States Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-QSB

(Mark One)
   [ X]      QUARTERLY  REPORT PURSUANT TO SECTION 13 OR 15(d) OF
             THE SECURITIES EXCHANGE ACT OF 1934
               For the quarterly period ended June 30, 2002.

   [   ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
              SECURITIES EXCHANGE ACT OF 1934
              For the transition period from ____________ to ___________

                        Commission file number : 0-30738

               Environmental Oil Processing Technology Corporation
               ---------------------------------------------------
                 (Exact name of business issuer in its charter)

             Utah                                            82-0520055
------------------------------                            ---------------
State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                          Identification No.)

 2801 Brandt Avenue, Nampa, Idaho                                      83687
--------------------------------------------------------------------------------
(Address of principal executive offices)                            (Zip Code)

Issuer's telephone number:  (208)-463-0063              Fax:     (208) 463-7601
--------------------------------------------------------------------------------



-------------------------------------------------------------------------------
                                (Former Address)

The number of shares of common stock
outstanding as of June 30, 2002, is 81,792,380

         Transitional Small Business Disclosure Format. Yes [   ], No [ X ].


                                       1
<PAGE>


                         PART I - FINANCIAL INFORMATION
                         ------------------------------

Item 1.  Financial Statements.

         The following financial statements are filed as part of this report:

         The Consolidated  Financial Statements of the Company for the three and
six months ended June 30, 2002 and 2001.

         The accompanying  consolidated  financial statements have been prepared
by the Company  without  audit.  In the opinion of management,  all  adjustments
which include only normal recurring  adjustments necessary to present fairly the
financial  position,  results of operations  and cash flows at June 30, 2002 and
2001 and for all periods presented have been made.

         Certain  information  and  footnote  disclosures  normally  included in
consolidated financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested that these
condensed  consolidated  financial  statements be read in  conjunction  with the
financial  statements and notes thereto  included in the Company's  December 31,
2001, audited consolidated  financial statements.  The results of operations for
the periods ended June 30, 2002 and 2001 are not  necessarily  indicative of the
operating results for the full years.


                                       2
<PAGE>


Item 2.  Management's Discussion and Plan of Operation:

         Results of Operations:

         During the first six months of 2002 the Company  focused its activities
on developing its used oil  refineries.  The Company  presently has two refinery
projects i.e. the pilot plant in Nampa, Idaho, and the Reno Project presently in
development which will be operated by a wholly owned subsidiary EOPT Refining of
Nevada, Inc.

         The Nampa plant became  operational  in the second quarter of 2001 with
the production of diesel,  naphtha and asphalt residuum,  all of which were sold
to local  wholesalers.  During  the last few  months  the plant  has been  under
improvement  modification  which  includes  a newly  engineered  and  fabricated
refining column and support equipment.  The modifications are now expected to be
completed  and the plant  operating  early in the fourth  quarter  of 2002.  The
modifications  are  engineered to improve the quality and quantity of production
of  petroleum  products.   When  the  modified  plant  is  operating  Management
anticipates having a positive cash flow from the Nampa operations.

         The Reno Project consists of completing land development on 20 acres of
land which was originally  purchased for used oil refining  plants to be located
on 15 acres and a co-generation  plant for electricity on the remaining 5 acres.
The site  preparation is essentially  completed and the  engineering  and design
work for two  refining  plants is in  advanced  stages  and  presently  on hold.
Engineering  for the Reno  project is being  completed by PC&E of St.  Louis,  a
subsidiary of Emerson  (formerly  Emerson Electric) and Redd Engineering of Salt
Lake City, Utah.  Approximately  $30,000,000 is needed to construct,  locate and
start up the two plants



                                       3
<PAGE>

which could be  operating  by the second  quarter of 2003 if  financing  is soon
obtained.  The remaining 5 acres of the development is "fully permitted" for the
production of electricity and is currently for sale for in excess of $20,000,000
with several interested parties.

         During the second  quarter of 2001 the Company  acquired  the assets of
Artesian Oil Recovery,  Inc. in Oakland  California for the sum of $485,000,  to
provide oil for the Reno Project. Pending completion of the Reno refineries, the
oil is being trucked to the Nampa refinery.

         The  settlement  of the  litigation  involving  the  separation  of the
subsidiary PDI was completed in March of 2002. Among other matters,  the Company
recovered and canceled  4,000,000  shares of its common stock from the owners of
PDI.  The  canceled  shares  were  valued  based on the net  assets in excess of
liabilities of PDI. The gain on the disposal of PDI of $294,746 recoups the loss
on the net assets in excess of liabilities  previously  recognized in the period
ending  September  30, 2001.  Accordingly,  the financial  statements  have been
restated to reflect the discontinued PDI operations.

         Operations  in the first six months of 2002  resulted  in  consolidated
revenues  of  $728,884  compared  to  $449,581  in the first six months of 2001.
Consolidated  revenues increased by 62% over the six months of 2001. The Company
had costs of sales of  $177,895  during  the six  months  ended  June 30,  2002,
compared to $116,667  for the same period of 2001.  These costs are for the used
oil purchased,  processed and sold at the Nampa, Idaho and Artesian  facilities.
EOPT's  gross  margin  was 76% of sales  in 2002  compared  to 74% in 2001.  The
increase in the margin was due to the  decrease in the cost of shipping the used
oil to Idaho in 2002 which occurred when the Company began leasing trucks from a
company owned by two of its directors.

         Selling,  general and  administrative  expense for the six months ended
June 30, 2002,  was  $1,485,312  compared to $1,249,086 for the same period last
year. The Company has stabilized  these operating  costs. The increase is due to
an expense of $260,157  which was recorded for the value of stock options issued
to  non-employees.  Excluding  this non cash expense  these  operating  expenses
decreased by $23,931.  The Company's business is labor intensive and its largest
expense is payroll. Included in consulting expense for the six months ended June
30, 2001, is $9,372,000  which is the value of 1,200,000  shares of common stock
issued for services to a consultant  during  January 2001.  Without the value of
the shares  issued to the  consultant,  consulting  expense  for the first three
months of 2001  would have been  $30,549  compared  to $24,500  for the same six
months of 2002. The Company has also stabilized its consulting costs.

         The Company's net loss from operations in the six months ended June 30,
2002,  was  $1,096,056  compared  to  $10,358,969  in the same  period  of 2001.
Excluding the value of the shares issued to the  consultant in January 2001, the
Company's  loss for the first six months of 2001 would have been  $986,969.  The
increase of $109,087 was primarily due to the  amortization  of debt issue costs
of $52,500 and depreciation of $51,533.  The Company expects its loss to decline
in the fourth quarter of 2002 with the new refining  column at its operations in
Nampa and the continued growth of Artesian Oil Recovery in Oakland California.

         Operations in the second three months of 2002 resulted in  consolidated
revenues of $411,319 compared to $251,545 in the second three months of 2001, an
increase of $159,774 or 64%. The increase was the result of the  acquisition  of
Artesian Oil Gathering.  The Company's  gross margin was 82% in 2002 compared to


                                       4
<PAGE>


73% in2001.  The improved  margin was the result of the Company  leasing  trucks
from two of its  officers  and  directors  instead of the  previous  practice of
hiring outside trucking.

         Selling,  general and administrative expense for the three months ended
June 30, 2002,  was  $910,469  compared to $674,100 for the same period of 2001.
Excluding the $260,157 recorded for the value of options issued to non employees
these  expenses  were  $650,312.  The  decrease  of  $23,788  was the  result of
management's cost containment efforts.

         Liquidity and Capital Resources.

         The  Company  entered  into a funding  agreement  with a trust  fund to
borrow  $10,500,000 for the  development and expansion of the Company  business.
Some of these funds were used in  designing  and  engineering  the  refining and
production  facility in the Reno Project.  Some of the loan funds have been used
to purchase the real property for the Reno Project,  and the  permitting of some
of the property for  electrical  production.  Through June 30, 2002, the Company
has  incurred  $6,812,738  for the cost of the Reno Project  including  $527,713
expended in the first six months of 2002. The Company also incurred $445,775 and
$584,166,  in the first six months of 2002 and 2001,  respectively on the Nampa,
Idaho facility.  The terms of the funding required the Company to repay the full
amount  borrowed in one year from the date funds were first received  subject to
the lender's option to extend the loan. The lender has agreed to extend the loan
for an additional six months to September 23, 2002.

         The  Company  used cash in its  operations  of  $43,521  during the six
months ended June 30, 2002,  compared to using cash in operations of $94,056 for
the  corresponding  period in the prior  year.  The  difference  of $50,535  was
primarily due to the net cash used in the operating losses of the Company offset
by the  increase in its  accounts  payable  and accrued  expenses to increase by
$761,911 in 2002  compared  to an  increase of $264,971 of accounts  payable and
accrued expenses in 2001.

         The Company's accounts  receivable  decreased by $651 from December 31,
2001, to June 30, 2002,  compared to an increase of $165,020 for the same period
of 2001.  The  increase  in 2001 was the result of the  Company's  expanded  oil
gathering business with the purchase of Artesian Oil Recovery.  The decrease for
2002 was due to better collection efforts by the Company's sales personnel.

         In 2001 the Company  accumulated  used oil for  processing in the Nampa
facility  therefore  inventory levels increased by $50,115 in 2001 compared to a
decrease of $8,389 in the same period of 2002  because the Company  sold some of
its used oil while the refinery is being refitted.

         The Company paid $25,892 of debt to banks in 2002  compared to $533,206
in 2001. The Company also repaid  related  parties cash of $491,500 in 2001. The
Company  borrowed $7,500 from an officer and director in the first six months of
2002. The Company  borrowed  $84,990 from related  parties and  $6,000,000  from
unrelated  parties during the same periods of 2001. The Company repaid  $210,000
of related  party debt in 2002 through the  issuance of 2,333,333  shares of its
common stock. It also issued 535, 714 shares to consultants on exercise of their
options and for  conversion  of accounts  payable of $175,000 and an  additional
103,217 shares to collectors for used oil valued at $17,991.


                                       5
<PAGE>



         The Company issued 9,600,000 shares to an officer and director upon the
exercise of his options at $0.17 per share for  3,600,000  shares and $0.085 per
share for 6,000,000  shares.  The officer and director gave the Company his note
for the exercise of the options.  The notes total $1,122,000,  are unsecured and
bear interest at 6% per annum.

         The Company has recorded a gain from  discontinued  operations in 2002,
in the amount of $294,746  related to the PDI  separation  which is the value of
the Company's 4,000,000 shares of common stock recovered. The Company had income
of $467,370 for the same period of 2001 from the operations of PDI.

         The Company is seeking  funding for the  completion of the Reno Project
and to meet its operating  costs. The Company is also  investigating,  reviewing
and  considering  additional  used oil  gathering  facilities as well as seeking
financing to acquire the same. No financing  agreements  have been formalized as
of this time and there is no assurance  that such funds will be  available  when
needed or if available will be under terms acceptable to the Company.

Forward Looking Statements.

         The  foregoing   paragraphs  in  this  MD&A  concerning  the  activity,
operations and plans of the Company, and particularly the planned development of
the Reno Project and the future of the "permitted  property" are forward-looking
statements as well as any other  statements  that are not historical in context.
The statements  provided are based on information  available to management as of
the date hereof,  and the Company assumes no obligation to revise or update such
forward-  looking  statements.  Readers are cautioned that such  forward-looking
statements  involve risk and  uncertainties  that may cause the Company's actual
results to differ materially from such forward- looking statements.

                           PART II - OTHER INFORMATION
                           ---------------------------

Item 1.  Legal Proceedings.

         On September 24, 2001,  EOPT filed a complaint  against LM Alternative,
Inc. ("LMA") in the United States District Curt, Central District of California,
Eastern Division, Case No. EDCV 01-0699 VAP (SGLx). EOPT seeks a money judgement
against  LMA.  EOPT  anticipates  that in addition  to filing an Answer  denying
EOPT's claims,  LMA will file a Counterclaim  seeking money damages against EOPT
for breach of contract. The case arises as a result of orders placed by EOPT for
electrical  generators,  and the alleged default by LMA. The parties have agreed
on a dismissal without prejudice and a moratorium on refiling for six months.

         American Moistening  Company,  Inc. filed a Complaint in North Carolina
in the Superior court  Division of  Mecklenburg  County on February 25, 2002 and
seeks a money  judgment  against  EOPT  for  $165,840  for  services  and  goods
performed  or  manufactured.  EOPT timely  filed an answer  asserting  that EOPT
canceled its purchase order and that there is no liability.  Opposing counsel is
requesting a settlement proposal. Both EOPT and AMCO are seeking attorneys' fees
and costs of litigation against the other.



                                       6
<PAGE>



Item 2.  Changes in Securities.

         (a)      None
         (b)      None

         (c)      The following  common stock was sold by the registrant  during
                  the second quarter of 2002:

                  (i)      On May 1, 2002, registrant issued 3,600,000 shares of
                           its common stock to N. Tod Tripple at $0.17 per share
                           (the  option  price).  Payment  for the  option was a
                           promissory  note in the  amount of  $612,000  bearing
                           interest at 6 % per annum,  all due and payable on or
                           before October 1, 2006.

                  (ii)     On May 1, 2002, registrant issued 6,000,000 shares of
                           its  common  stock to N. Tod  Tripple  at $0.085  per
                           share (the option price).  Payment for the option was
                           a promissory  note in the amount of $510,000  bearing
                           interest at 6 % per annum,  all due and payable on or
                           before May 1, 2007.

Item 3.  Defaults Upon Senior Securities.   None

Item 4.  Submission of Matters to a Vote of Security Holders.   None

Item 5.  Other Information.

         In 2001  EOPT  received  the last of the  required  Federal  and  State
permits and approvals for construction and operation of an electrical production
facility on 5 acres of the Reno Project.  These  permits are the Federal  Energy
Regulatory  Commission's  ("FERC")  authorization to sell energy at market based
rates, the Nevada Public Utility Commission Utility  Environmental  Planning Act
Permit, the State of Nevada Department of Conservation and Natural Resources Air
Quality  operating  Permit,  and the Storey County Special Use Permit.  EVOP has
decided to not pursue the  production  of  electricity  at this time on the Reno
Project,  and is presently  negotiating  for the sale of the applicable 5 acres.
The EOPT property is near the entrance to the Tahoe-Reno  Industrial Center, one
of the largest industrial zoned developments in the United States.

         Statements  in  this  report  that  are  not  strictly  historical  are
forward-looking   statements.  The  Company  makes  these  statements  based  on
information  available  to it as of the date of this  report  and it  assumes no
responsibility to update or revise such forward-looking statements.  Editors and
investors are cautioned that such  forward-looking  statements  involve risk and
uncertainties  that may cause the Company's actual results to differ  materially
from such forward- looking statements.

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

         (a)      No exhibits.

         (b)      No Form 8-K filed during the second quarter of 2002.


                                       7
<PAGE>


                                   SIGNATURES
                                   ----------

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

                             Environmental Oil Processing Technology Corporation
                                               (Registrant)

Date:    August 12, 2002     By/s/ N. Tod Tripple
                                   ---------------------------------
                                   N. Tod Tripple, President and CEO




                                 CERTIFICATION
                                       BY
                            CHIEF EXECUTIVE OFFICER
                                      AND
                            CHIEF FINANCIAL OFFICER

In  compliance  with  Section  906  of  the  Sarbanes-Oxley  Act  of  2002,  the
undersigned Chief Executive Officer and Chief Financial Officer of Environmental
Oil  Processing  Technology  Corporation  hereby certify that the report on Form
10QSB for the period  ending June 30,  2002,  as filed with the  Securities  and
Exchange Commission

        (i)     fully complies with the requirements of Section 13(a) or 15(D)oF
                the Securities Exchange Act of 1934, and


        (ii)    the information  contained in the report fairly presents, in all
                material  respects,  the  financial  condition  and  results  of
                operations of the Company.

                                        /s/ N. Tod Tripple
August 9, 2002                          ----------------------------------------
                                            N. Tod Tripple, President and CEO


                                        /s/ Leo (Tony)Tripple
                                        ---------------------------------------
                                            Leo (Tony)Tripple, CFO



                                       8
<PAGE>



                          ENVIRONMENTAL OIL PROCESSING
                             TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS

                       June 30, 2002 and December 31, 2001











                                      F-1



                          ENVIRONMENTAL OIL PROCESSING
                             TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS

                       June 30, 2002 and December 31, 2001
                Item                                                 Page
                ----                                                 ----
Consolidated Balance Sheets at June 30, 2002
and December 31, 2001                                                 F-3

Consolidated Statement of Operations for three months
ended June 30, 2002 and 2001 and for the
six months ended June 30, 2002 and 2001                               F-5

Consolidated Statement of Stockholders' Equity (Deficit)              F-6

Consolidated Statement of Cash Flows for the three months
ended June 30, 2002 and 2001                                          F-7

Notes to Consolidated Financial Statements                            F-9


                                       F-2
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES

                           Consolidated Balance Sheets


                                     ASSETS
                                     ------
<TABLE>
<CAPTION>
                                                               June 30,      December 31,
                                                                 2002             2001
                                                             ------------    -------------
                                                              (Unaudited)

CURRENT ASSETS
<S>                                                          <C>             <C>
   Cash                                                      $     41,398    $  1,076,799
   Trade accounts receivable, less allowance for
    doubtful accounts of $10,000 and $10,000, respectively        128,634         129,285
   Inventories                                                    200,545         190,943
   Other current assets                                           164,054          48,358
                                                             ------------    ------------

     Total Current Assets                                         534,631       1,445,385
                                                             ------------    ------------

PROPERTY, PLANT AND EQUIPMENT                                   4,277,970       3,878,670
   Less accumulated depreciation                                 (288,726)       (237,193)
                                                             ------------    ------------

     Property, Plant and Equipment, Net                         3,989,244       3,641,477
                                                             ------------    ------------

OTHER ASSETS

   Construction in progress                                     6,812,738       6,238,550
   Deposits                                                            40              40
   Intangible assets, net                                         361,600         394,800
   Unamortized debt issue costs                                      --            52,500
                                                             ------------    ------------

     Total Other Assets                                         7,174,378       6,685,890
                                                             ------------    ------------

     TOTAL ASSETS                                            $ 11,698,253    $ 11,772,752
                                                             ============    ============
</TABLE>


       The accompanying notes are an integral part of these consolidated
                              financial statements.


                                       F-3
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                           Consolidated Balance Sheets

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                 ----------------------------------------------
<TABLE>
<CAPTION>

                                                              June 30,       December 31,
                                                                2002             2001
                                                           ------------    --------------
                                                            (Unaudited)
CURRENT LIABILITIES
<S>                                                        <C>             <C>
   Accounts payable                                        $    747,696    $    694,176
   Accrued expenses                                           1,756,972       1,236,081
   Notes payable - related parties                                7,500         210,000
   Notes payable                                             10,500,000      10,525,892
                                                           ------------    ------------

     Total Current Liabilities                               13,012,168      12,666,149
                                                           ------------    ------------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY (DEFICIT)

   Common stock, no par value; 200,000,000
    shares authorized; 81,792,380 and 73,220,116
    shares issued and outstanding, respectively              24,763,956      23,249,988
   Note and interest receivable - related party (Note 3)     (1,133,066)           --
   Accumulated deficit                                      (24,944,805)    (24,143,385)
                                                           ------------    ------------

     Total Stockholders' Equity (Deficit)                    (1,313,915)       (893,397)
                                                           ------------    ------------

     TOTAL LIABILITIES AND STOCKHOLDERS'
     EQUITY (DEFICIT)                                      $ 11,698,253    $ 11,772,752
                                                           ============    ============
</TABLE>

       The accompanying notes are an integral part of these consolidated
                              financial statements.


                                       F-4
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                     Consolidated Statements of Operations
                                (Unaudited)

<TABLE>
<CAPTION>

                                                   For the                          For the
                                             Three Months Ended                Six Months Ended
                                                  June 30,                         June 30,
                                         ----------------------------    ----------------------------
                                               2002          2001             2002              2001
                                         ------------    ------------    -------------   ------------
<S>                                      <C>             <C>             <C>             <C>
NET SALES                                $    411,319    $    251,545    $    728,884    $    449,581

COST OF GOODS SOLD                             75,100          67,567         177,895         116,667
                                         ------------    ------------    ------------    ------------

GROSS MARGIN                                  336,219         183,978         550,989         332,914
                                         ------------    ------------    ------------    ------------

OPERATING EXPENSES

   Amortization of debt issue cost               --              --            52,500            --
   Consulting                                  14,000          15,336          24,500       9,402,549
   Depreciation and amortization               42,366          20,124          84,733          40,248
   Selling, general and administrative        910,469         674,100       1,485,312       1,249,086
                                         ------------    ------------    ------------    ------------

     Total Operating Expenses                 966,835         709,560       1,647,045      10,691,883
                                         ------------    ------------    ------------    ------------

LOSS FROM OPERATIONS                         (630,616)       (525,582)     (1,096,056)    (10,358,969)
                                         ------------    ------------    ------------    ------------

OTHER INCOME (EXPENSE)

   Interest expense                              (667)         (8,524)         (1,856)        (34,042)
   Interest income                                242           6,008           1,746           8,544
                                         ------------    ------------    ------------    ------------

     Total Other Income (Expense)                (425)         (2,516)           (110)        (25,498)
                                         ------------    ------------    ------------    ------------

INCOME TAX EXPENSE                               --              --              --              --
                                         ------------    ------------    ------------    ------------

LOSS FROM CONTINUING
 OPERATIONS                                  (631,041)       (528,098)     (1,096,166)    (10,384,467)

INCOME FROM DISCONTINUED
 OPERATIONS (Note 4)                             --           492,207         294,746         467,370
                                         ------------    ------------    ------------    ------------

NET LOSS                                 $   (631,041)   $    (35,891)   $   (801,420)   $ (9,917,097)
                                         ============    ============    ============    ============

BASIC INCOME (LOSS) PER
 COMMON SHARE

   Loss from continuing operations       $      (0.01)   $      (0.01)   $      (0.01)   $      (0.14)
   Income from discontinued operations           0.00            0.01            0.00            0.01
                                         ------------    ------------    ------------    ------------

     Basic income (loss) per share       $      (0.01)   $      (0.00)   $      (0.01)   $      (0.13)
                                         ============    ============    ============    ============

WEIGHTED AVERAGE SHARES
 OUTSTANDING                               78,522,050      73,520,116      76,055,662      73,387,039
                                         ============    ============    ============    ============
</TABLE>

       The accompanying notes are an integral part of these consolidated
                              financial statements.



                                       F-5
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
            Consolidated Statements of Stockholders' Equity (Deficit)

<TABLE>
<CAPTION>


                                                                           Note and
                                                  Common Stock             Interest                         Total
                                         ----------------------------      Receivable-    Accumulated    Stockholders'
                                             Shares           Amount     Related Party      Deficit      Equity (Deficit)
                                         --------------- ------------    -------------   ------------    ---------------

<S>                                      <C>             <C>             <C>             <C>             <C>
Balance, December 31, 2000                 72,020,116    $ 12,943,211    $       --      $ (9,255,116)   $  3,688,095

Common stock issued for services            1,200,000       9,372,000            --              --         9,372,000

Stock options granted to employees
   below market value                            --           561,400            --              --           561,400

Stock options granted to nonemployees
   below market value                            --           373,377            --              --           373,377

Net loss for the year ended
   December 31, 2001                             --              --              --       (14,888,269)    (14,888,269)
                                         ------------    ------------    ------------    ------------    ------------

Balance, December 31, 2001                 73,220,116      23,249,988            --       (24,143,385)       (893,397)

Common stock issued for inventory
 (unaudited)                                  103,217          17,991            --              --            17,991

Common stock issued for options
 exercised (unaudited)                        500,000         175,000            --              --           175,000

Conversion of accounts payable to
 common stock (unaudited)                      35,714          12,500            --              --            12,500

Common stock issued for conversion
   of debt (unaudited)                      2,333,333         210,000            --              --           210,000

Cancellation of shares returned in
 settlement agreement by Project
 Development Industries (unaudited)        (4,000,000)       (294,746)           --              --          (294,746)

Stock options granted to nonemployees
 at market value (unaudited)                     --           260,157            --              --           260,157

Common stock issued for options
 exercised at $0.17 per share
 (unaudited)                                3,600,000         612,000        (612,000)           --              --

Common stock issued for options
 exercised at $0.085 per share
 (unaudited)                                6,000,000         510,000        (510,000)           --              --

Interest accrued on related party note           --            11,066         (11,066)           --              --

Net loss for the six months ended
   June 30, 2002 (unaudited)                     --              --              --          (801,420)       (801,420)
                                         ------------    ------------    ------------    ------------    ------------

Balance, June 30, 2002 (unaudited)       $ 81,792,380    $ 24,763,956    $(1,133,066)    $(24,944,805)   $ (1,313,915)
                                         ============    ============    ============    ============    ============
</TABLE>

      The accompanying notes are an integral part of these consolidated
                              financial statements.


                                       F-6
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                           For the Six Months Ended
                                                                    June 30,
                                                         ----------------------------
                                                                2002          2001
                                                         -------------   ------------

CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                       <C>            <C>
   Net loss                                               $  (801,420)   $(9,917,097)
   Adjustments to reconcile net loss to net cash
    used by operating activities:
     Amortization of debt issue costs                          52,500           --
     Depreciation and amortization                             84,733        224,136
     Common stock issued for services                            --        9,477,000
     Gain on disposal of subsidiary                          (294,746)          --
     Stock options granted below market value                 260,157           --
   Changes in operating assets and liabilities:

     Accounts receivable                                          651       (165,020)
     Inventories                                                8,389        (50,115)
     Other assets                                            (115,696)        72,069
     Accounts payable and accrued expenses                    761,911        264,971
                                                          -----------    -----------

       Net Cash Used by Operating Activities                  (43,521)       (94,056)
                                                          -----------    -----------

CASH FLOWS USED IN INVESTING ACTIVITIES

   Construction in progress                                  (527,713)    (4,464,069)
   Capital expenditures                                      (445,775)      (584,166)
                                                          -----------    -----------

       Net Cash Used by Investing Activities                 (973,488)    (5,048,235)
                                                          -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES

   Borrowings from notes payable - related parties              7,500         84,990
   Payments on notes payable - related parties                   --         (491,500)
   Proceeds from notes payable                                   --        6,000,000
   Payments on notes payable                                  (25,892)      (533,206)
                                                          -----------    -----------

       Net Cash Provided (Used) by Financing Activities       (18,392)     5,060,284
                                                          -----------    -----------

NET DECREASE IN CASH                                       (1,035,401)       (82,007)

CASH, BEGINNING OF PERIOD                                   1,076,799        273,215
                                                          -----------    -----------

CASH, END OF PERIOD                                       $    41,398    $   191,208
                                                          ===========    ===========
</TABLE>

      The accompanying notes are an integral part of these consolidated
                              financial statements.



                                       F-7
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                Consolidated Statements of Cash Flows (Continued)
                                   (Unaudited)

                                                 For the Six Months Ended
                                                         June 30,
                                           ----------------------------------
                                                2002                2001
                                           -------------       --------------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
 INFORMATION:

   Cash paid for interest                   $      1,189        $     60,329
   Cash paid for taxes                      $         --        $         --

SUPPLEMENTAL DISCLOSURE OF NON-CASH
 FINANCING ACTIVITIES:

Year ended December 31, 2001:
-----------------------------

   The Company entered into a $210,000 promissory note for debt issue costs paid
   on behalf of the Company by the President of the Company.

Six Months ended June 30, 2002:
-------------------------------

   The Company issued 2,333,333 shares of its common stock for conversion of the
   $210,000 promissory note to the President of the Company.

   The  Company  issued  35,714  shares of its common  stock for  conversion  of
   accounts  payable and 500,000 shares of its common stock for accounts payable
   applied to exercise of stock options to its consultants on the Reno Project.

   The Company  issued 103,217 shares of its common stock for used oil collected
from various companies.

   The Company issued  3,600,000  shares of its common stock to the President of
   the Company for options exercised at $0.17 per share and the President of the
   Company gave a $612,000 promissory note as payment of the exercise price (See
   Note 3).

   The Company issued  6,000,000  shares of its common stock to the President of
   the Company for options  exercised  at $0.085 per share and the  President of
   the Company gave a $510,000  promissory note as payment of the exercise price
   (See Note 3).

   The Company has accrued  interest of $11,066 for the two related  party notes
   and has recorded the amount as a reduction  of  stockholder's  equity with an
   offset to contributed capital.

      The accompanying notes are an integral part of these consolidated
                              financial statements.

                                       F-8
<PAGE>


               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


NOTE 1 -     BASIS OF FINANCIAL STATEMENT PRESENTATION

             The  accompanying   unaudited  condensed   consolidated   financial
             statements have been prepared by the Company  pursuant to the rules
             and regulations of the Securities and Exchange Commission.  Certain
             information   and  footnote   disclosures   normally   included  in
             consolidated  financial  statements  prepared  in  accordance  with
             accounting  principles  generally  accepted in the United States of
             America  have been  condensed  or omitted in  accordance  with such
             rules and  regulations.  The  information  furnished in the interim
             condensed   consolidated   financial   statements   include  normal
             recurring  adjustments and reflects all adjustments,  which, in the
             opinion of  management,  are necessary for a fair  presentation  of
             such  consolidated   financial   statements.   Although  management
             believes the disclosures and information  presented are adequate to
             make the  information  not  misleading,  it is suggested that these
             interim  condensed  consolidated  financial  statements  be read in
             conjunction  with the Company's  most recent  audited  consolidated
             financial statements and notes thereto included in its December 31,
             2001 Annual Report on Form 10-KSB.  Operating results for the three
             and six months ended June 30, 2002 are not  necessarily  indicative
             of the results  that may be expected  for the year ending  December
             31, 2002.

NOTE 2 -     GOING CONCERN

             The Company presently has in the bank  approximately  $41,000.  The
             Company's  negative cash flow from operations  averages $15,000 per
             month.  Therefore  the Company is  currently  able to pay its bills
             from its reserves for the next quarter.  As waste oil collection by
             Artesian  continues to grow the Company  expects this will increase
             refined oil sales.  The Company is modifying its refining  plant in
             Nampa,  Idaho  and  adding  a new  column  that is  expected  to be
             completed  by the  end of the  fourth  quarter  2002.  The  Company
             expects this to produce positive cash flows from operations by 2002
             year-end. The Company's loan in the amount of  $10,500,000  was due
             on March 23, 2002. However,  the Company has negotiated a six month
             extension  with the note  holder and the new due date is  September
             23, 2002. The Company is building two plants in Reno,  Nevada.  The
             Company is seeking  financing for the plant.  If the financing does
             not become available soon enough then  construction  will be slowed
             so that the Company does not become over extended.  However,  there
             can be no  assurance  that the Company  will be  successful  in its
             plans. Because the Company has experienced  substantial losses from
             operations and has a working capital deficit of $12,477,537,  there
             is substantial  doubt about the Company's  ability to continue as a
             going concern.

                                       F-9
<PAGE>

               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


NOTE 3 -     MATERIAL EVENTS

             Litigation

             On March 4, 2002, the Company entered into a Separation  Agreement,
             Settlement  Agreement and Mutual  Release with Project  Development
             Industries,  L.L.C.  (PDI) and several  individuals.  During  March
             2002, the Company has paid a $155,000 invoice  previously  tendered
             by PDI and PDI has  returned 4 million  shares of common  stock and
             cancelled the $6 million contingent promissory note. The promissory
             note was to be paid based upon earnings by PDI. PDI recorded a loss
             for the period  from April 1, 1999 to  December  31,  1999 and EOPT
             agreed  to defer  the  implementation  of the  contingency  but the
             criteria  for  payment of the note were  never met and the  Company
             never recorded the note as a liability.

             Truck Lease

             During March 2002,  the Company  entered into a one-year  operating
             lease for two trucks and related equipment with Oil  Transportation
             Company,  Inc.  (OTC),  a  company  owned by the  President  of the
             Company and an unrelated individual. The monthly lease payments are
             based on $0.50 per actual running  mileage in a month.  The Company
             has  prepaid  OTC the amount of $20,000  that is  included in other
             current assets as of June 30, 2002.

             Notes Payable

             The Company has  negotiated an extension on its note payable in the
             amount of $10,500,000 which was due on March 23, 2002. The due date
             on the note has been extended six months to September 23, 2002.

             Notes and Interest Receivable - Related Party

             On May 1,  2002,  the  President  of the  Company  gave a  $612,000
             promissory  note to the  Company  as  payment  of the  exercise  of
             3,600,000  options to purchase the Company's  common stock at $0.17
             per share.  The promissory  note bears interest at 6% per annum, is
             unsecured, and is payable on October 1, 2006.

             Also, on May 1, 2002,  the President of the Company gave a $510,000
             promissory  note to the  Company  as  payment  of the  exercise  of
             6,000,000  options to purchase the Company's common stock at $0.085
             per share.  The promissory  note bears interest at 6% per annum, is
             unsecured, and is payable on May 1, 2007.

             At June 30, 2002,  total interest  receivable  from these notes was
             $11,066.  Both  notes  receivable  and  related  interest  from the
             related  party  have been  shown as a  reduction  of  stockholders'
             equity  and the  related  interest  income  for the period has been
             recorded as contributed capital.

                                       F-10
<PAGE>
               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


             NOTE 4 - DISCONTINUED OPERATIONS

             On September 14, 2001, Project Development  Industries,  LLC (PDI),
             the  Company's  wholly-owned  subsidiary,  and several  individuals
             filed a complaint in a federal  district court against the Company.
             In  March  2002,  the  Company  and PDI  reached  an  agreement  of
             separation, settlement and mutual release. Both PDI and the Company
             agreed and  consented to separate  PDI from the Company  completely
             and to rescind the original share purchase agreement subject to the
             terms and conditions of the  settlement.  The Company has accounted
             for  the  operations  of PDI as  discontinued  and has  used  PDI's
             financial statements as of June 30, 2001. At June 30, 2001, PDI had
             net assets in excess of liabilities  of $294,746.  An allowance has
             been  established  for the net assets in excess of  liabilities  of
             PDI,  thus, the value of the net assets of PDI at December 31, 2001
             was $-0-.  During March 2002, PDI returned  4,000,000 shares of the
             Company's common stock which was then cancelled by the Company. The
             cancelled  shares were valued  based on the net assets in excess of
             liabilities  of PDI.  The gain on the  disposal  of PDI recoups the
             loss  on  the  net  assets  in  excess  of  liabilities  previously
             recognized in the period ended September 30, 2001. The following is
             a summary of loss from discontinued  operations  resulting from the
             litigation between PDI and the Company for the three and six months
             ended June 30, 2002 and 2001. The consolidated financial statements
             have been retroactively restated to reflect this event.


                                       F-11
<PAGE>

               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


NOTE 4 - DISCONTINUED OPERATIONS (Continued)
<TABLE>
<CAPTION>

                                                  For the                        For the
                                            Three Months Ended              Six Months Ended
                                                 June 30,                       June 30,
                                         ----------------------------   --------------------------
                                           2002            2001           2002           2001
                                         -------------   ------------   ------------   -----------
                                         (Unaudited)     (Unaudited)    (Unaudited)   (Unaudited)
<S>                                      <C>              <C>            <C>           <C>
NET SALES                                $         --     $   766,949    $      --     $ 1,377,808

COST OF SALES                                      --            --             --            --
                                         --------------   -----------    -----------   -----------

GROSS MARGIN                                       --         766,949           --       1,377,808

OPERATING EXPENSES

  Consulting                                       --          59,963           --          74,016
  Depreciation and amortization                    --          91,944           --         183,888
  Selling, general and administrative              --         115,831           --         626,250
                                         --------------   -----------    -----------   -----------

    Total Operating Expenses                       --         267,738           --         884,154
                                         --------------   -----------    -----------   -----------

INCOME FROM OPERATIONS                             --         499,211           --         493,654
                                         --------------   -----------    -----------   -----------

OTHER INCOME (EXPENSE)

  Interest expense                                 --          (7,006)          --         (26,287)
  Interest income                                  --               2           --               3
  Gain on disposal of subsidiary                   --            --          294,746          --
  Loss on impairment of goodwill                   --            --             --            --
  Loss on impairment of net assets
   in excess of liabilities of Project
   Development Industries                          --            --             --            --
                                         --------------   -----------    -----------   -----------

    Total Other Income (Expense)                   --          (7,004)       294,746       (26,284)
                                         --------------   -----------    -----------   -----------

INCOME TAX EXPENSE                                 --            --             --            --
                                         --------------   -----------    -----------   -----------

INCOME FROM DISCONTINUED
 OPERATIONS                              $         --     $   492,207    $   294,746   $   467,370
                                         ==============   ===========    ===========   ===========

</TABLE>
                                       F-12
<PAGE>

               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


NOTE 5 -     OUTSTANDING STOCK OPTIONS

             The Company applies Accounting Principles Board ("APB") Opinion 25,
             "Accounting   for  Stock   Issued  to   Employees,"   and   related
             Interpretations in accounting for all stock option plans. Under APB
             Opinion  25,  compensation  cost is  recognized  for stock  options
             granted to employees  when the option price is less than the market
             price of the underlying common stock on the date of grant.

             As a result of applying APB Opinion 25 to stock options  granted to
             employees,  the Company did not incur an additional expense for the
             six months ended June 30, 2002.

             FASB  Statement  123,  "Accounting  for  Stock-Based  Compensation"
             ("SFAS  No.  123"),   requires  the  Company  to  provide  proforma
             information  regarding  net  income  and net income per share as if
             compensation  costs for the Company's  stock option plans and other
             stock awards had been  determined in accordance with the fair value
             based method  prescribed in SFAS No. 123. The Company estimates the
             fair  value of each  stock  award at the  grant  date by using  the
             Black-Scholes  option  pricing  model with the  following  weighted
             average assumptions used for grants,  respectively;  dividend yield
             of zero  percent  for all years;  expected  volatility  of 155.95%;
             risk-free interest rates of 4.475% and expected lives of 5.0 years.

             As a result of applying  SFAS No. 123 to stock  options  granted on
             May 1, 2002 to  nonemployees,  the  Company  recorded an expense of
             $260,157  for the six months  ended June 30,  2002.  The expense is
             included in the selling,  general and administrative  amount in the
             statement of operations.

             Had  compensation  cost for the Company's  stock options granted to
             employees been determined based on the fair value at the grant date
             under the accounting  provisions of SFAS No. 123, the Company would
             have  recorded an additional  expense of $59,127.  Also under these
             same provisions,  the Company's net loss would have been changed by
             the pro forma amounts indicated below:



                                       F-13
<PAGE>


               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


NOTE 5 -      OUTSTANDING STOCK OPTIONS (Continued)
<TABLE>
<CAPTION>
                                                                                  For the Six Months Ended
                                                                                           June 30,
                                                                           ---------------------------------------
                                                                                  2002                 2001
                                                                           ------------------  -------------------
                                                                               (Unaudited)          (Unaudited)
<S>                                                                        <C>                 <C>
              Net loss:
                As reported                                                $         (801,420) $      (9,917,097)
                Pro forma                                                  $         (860,547) $      (9,917,097)

                                                                                  For the Six Months Ended
                                                                                          June 30,
                                                                           ---------------------------------------
                                                                                  2002                 2001
                                                                           ------------------  -------------------
                                                                               (Unaudited)          (Unaudited)
              Basic loss per share:
                As reported                                                $            (0.01) $           (0.13)
                Pro forma                                                  $            (0.01) $           (0.13)
</TABLE>

              A summary of the status of the Company's  stock option plans as of
              June 30, 2002 and changes during the period is presented below:

<TABLE>
<CAPTION>
                                                                                              Weighted
                                                                                               Average
                                                                             Shares        Exercise Price
                                                                           -----------     --------------
<S>                                                                        <C>              <C>
              Outstanding, December 31, 2001                                 6,950,000        $ 0.190

                  Granted                                                   10,050,000          0.085
                  Canceled                                                        --            --
                  Exercised                                                 10,100,000          0.130
                                                                           -----------        ----------

              Outstanding, June 30, 2002 (unaudited)                         6,900,000        $ 0.120
                                                                           -----------        ----------

              Exercisable, June 30, 2002 (unaudited)                        6,500,000         $ 0.120
                                                                           -----------        ----------
</TABLE>

<TABLE>
<CAPTION>

                                                           Outstanding                        Exercisable
                                         -------------------------------------------- --------------------------
                                                          Weighted
                                                           Average        Weighted                   Weighted
                                            Number       Remaining         Average       Number      Average
                                         Outstanding  Contractual         Exercise    Exercisable    Exercise
              Exercise Prices            at 06/30/02         Life            Price    at 06/30/02      Price
              ---------------            -----------------------------  ------------  -----------   ------------
<S>           <C>                        <C>               <C>           <C>           <C>            <C>
              $ 0.085                    4,050,000         5.00          $ 0.085       4,050,000      $ 0.085
                0.170                    2,670,000         3.00            0.170       2,360,000        0.170
                0.350                      180,000         3.00            0.350          90,000        0.350
                                         ---------       --------        ----------    ---------      ---------
              $ 0.085 - 0.350            6,900,000         3.77          $ 0.120       6,500,000      $ 0.120
                                         =========       ========        ==========    =========      =========

</TABLE>


                                       F-14
<PAGE>



               ENVIRONMENTAL OIL PROCESSING TECHNOLOGY CORPORATION
                                AND SUBSIDIARIES
                 Notes to the Consolidated Financial Statements
                       June 30, 2002 and December 31, 2001


             NOTE 5 - OUTSTANDING STOCK OPTIONS (Continued)

             On May 1, 2002,  the Company  granted  10,050,000  stock options to
             officers,  employees,  consultants  and  other  individuals.  These
             options were issued with an exercise price of $0.085 per share. All
             of these options vest immediately and have a maturity of five years
             from the grant date.

             Also  on May 1,  2002,  the  President  of  the  Company  exercised
             3,600,000 of the options at the exercise  price of $0.17 per share.
             As payment to exercise these options,  the President of the Company
             gave a $612,000 promissory note to the Company. (See Note 3).

             And  on  May 1,  2002,  the  President  of  the  Company  exercised
             6,000,000 of the options at the exercise price of $0.085 per share.
             As payment to exercise these options,  the President of the Company
             gave a $510,000 promissory note to the Company. (See Note 3).

NOTE 6 -     OPERATING SEGMENT INFORMATION

             For the six months ended June 30, 2002, the Company operated in
              two geographic segments,  (1) waste oil collection and refining at
              the  Company's  headquarters  in Nampa,  Idaho,  and (2) waste oil
              collection at the Company's offices in Oakland, California.

<TABLE>
<CAPTION>
                                                  For the Six
                                                  Months Ended
                                                    June 30,          ARTESIAN             EOPTI           Totals
                                                ----------------  ---------------       ----------      -----------
<S>                                                   <C>             <C>                 <C>               <C>
              Net Sales                               2001            55,485              394,096           449,581
                                                      2002           177,466              551,418           728,884

              Operating income (loss)                 2001          (724,843)          (9,634,126)      (10,358,969)
                                                      2002            49,120           (1,145,176)       (1,096,056)

              General corporate                       2001                --                 --                --
                                                      2002                --                 --                --

              Other Income (Expense)                  2001                --            (25,498)            (25,498)
                                                      2002                --               (110)               (110)

              Operating Assets                        2001                --         12,116,965          12,116,965
                                                      2002           408,514         11,289,739          11,698,253

</TABLE>


                                       F-15
<PAGE>




NOTE 7 -     SUBSEQUENT EVENTS

             Subsequent  to June 30, 2002,  the Company  issued 74,973 shares of
             its common stock at $0.075 per share for inventory purchased during
             the three months ended June 30, 2002. The total value of the shares
             of $5,623 was included in accounts payable at June 30, 2002.

             Also subsequent to June 30, 2002, the Company issued 100,000 shares
             of its common stock for accounts payable applied to the exercise of
             stock  options at an  exercise  price of $0.085 per share to one of
             its  consultants.  The total  value of the  shares  of  $8,500  was
             included in accounts payable at June 30, 2002.


                                       F-16