U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   FORM 10-QSB
                                   (Mark One)

  X    QUARTERLY  REPORT UNDER  SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE
-----  ACT OF1934
                 For the quarterly period ending March 31, 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 0-29613
                                                -------

                         TIDELANDS OIL & GAS CORPORATION
                 ----------------------------------------------
                 (Name of Small Business Issuer in its Charter)


           NEVADA                                       66-0549380
-------------------------------             ------------------------------------
   (State of Incorporation)                   (IRS Employer Identification No.)



13330 Leopard St., Corpus Christi, TX                       78410
----------------------------------------       ---------------------------------
(Address of principal executive offices)                  (Zip Code)



Issuer's telephone number,(   361     )     241       -          2244
                           -----------  -------------   -----------------------

                 9309 North Star Road, Corpus Christi, TX 78409
         -------------------------------------------------------------
         Former Name, former address and former fiscal year if changed
                               since last report

     Indicate by check mark 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  registrant  was  required  to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes X  No
         ---   ---


     State the number of shares  outstanding  of each of the  issuer's  class of
common  equity,  as of the latest  practicable  date: As of March 31, 2002,  the
registrant had 28,174,900 shares of common stock, par value .001 outstanding.

     Transitional Small Business Disclosure Format
     (Check One)
     Yes    No
        ---   ---

<PAGE>

                         TIDELANDS OIL & GAS CORPORATION
                                   FORM 10-QSB


                          PART I-FINANCIAL INFORMATION

Item 1. Financial Statements. (Unaudited)

                         TIDELANDS OIL & GAS CORPORATION
                                   FORM 10-QSB


                                      INDEX

                                                                            Page
PART I - Financial Information

Item 1 - Financial Statements
         Condensed Consolidated Balance Sheets as of
         March 31, 2002 and December 31, 2001.............................   3-4

         Condensed Consolidated Statements of Operations
         For the Three Months Ended March 31, 2002 and 2001...............     5

         Condensed Consolidated Statements of Cash Flows
         For the Three Months Ended March 31, 2002 and 2001...............   6-7

         Notes to Condensed Consolidated Financial Statements.............  8-10

Item 2 - Management's Discussion and Analysis or Plan of Operation........    11

PART II - Other Information

Item 1 - Legal Proceedings ...............................................    13

Item 2 - Changes in Securities and Use of Proceeds........................    13

Item 3 - Defaults Upon Senior Securities..................................    14

Item 4 - Submission of Matters to a Vote of Security Holdings.............    14

Item 5 - Other Information................................................    14

Item 6 - Exhibits and Reports on Form 8K .................................    14

Signature.................................................................    15



                                      - 2 -



<PAGE>

                         TIDELANDS OIL & GAS CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS



                                     ASSETS



                                             March 31, 2002    December 31, 2001
                                           -----------------   -----------------
                                              (Unaudited)

Current Assets:
      Cash                                 $         137,666   $         397,491
      Accounts Receivable                             68,875              67,675
      Inventory                                        8,272               7,515
      Prepaid Expenses                               631,011             304,244
                                           -----------------   -----------------
         Total Current Assets                        845,824             776,925
                                           -----------------   -----------------

Property Plant and Equipment, Net                    930,769             827,020
                                           -----------------   -----------------

Other Assets:
      Deposits                                         1,607               1,776
      Deferred Charges                             1,333,667                   0
      Intangible Assets, Net                          52,910              52,910
                                           -----------------   -----------------
         Total Other Assets                        1,388,184              54,686
                                           -----------------   -----------------

         Total Assets                      $       3,164,777   $       1,658,631
                                           =================   =================




      See Accompanying Notes to Condensed Consolidated Financial Statements

                                       -3-


<PAGE>
<TABLE>
<CAPTION>

                         TIDELANDS OIL & GAS CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (CONTINUED)


                     LIABILITIES AND STOCKHOLDERS' (DEFICIT)


                                                      March 31, 2002     December 31, 2001
                                                    -----------------    -----------------
                                                       (Unaudited)
<S>                                                 <C>                  <C>
Current Liabilities:
      Accounts Payable and
          Accrued Expenses                          $       1,185,088    $       1,268,679
      Current Maturities of Long-Term Debt                    633,577              839,123
                                                    -----------------    -----------------
         Total Current Liabilities                          1,818,665            2,107,802

Long-Term Debt                                                330,750              198,767

Due to Related Parties                                      1,876,668            1,534,105
                                                    -----------------    -----------------

         Total Liabilities                                  4,026,083            3,840,674
                                                    -----------------    -----------------

Commitments and Contingencies                                    --                   --

Stockholders' (Deficit)
      Common Stock, $.001 par value per share,
        100,000,000 shares authorized;
          28,174,900 shares issued and
         outstanding March 31, 2002
         24,154,900 shares issued and outstanding
          December 31, 2001                                    28,176               24,156

Additional Paid-in Capital                                  4,712,771            3,017,751
Subscriptions Receivable                                      (18,000)             (18,000)
Accumulated (Deficit)                                      (5,584,253)          (5,205,950)
                                                    -----------------    -----------------

         Total Stockholders' (Deficit)                       (861,306)          (2,182,043)
                                                    -----------------    -----------------

         Total Liabilities and
              Stockholders' (Deficit)               $       3,164,777    $       1,658,631
                                                    =================    =================

</TABLE>


      See Accompanying Notes to Condensed Consolidated Financial Statements
                                       -4-

<PAGE>
<TABLE>
<CAPTION>

                         TIDELANDS OIL & GAS CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


                                                 Three Months Ended    Three Months Ended
                                                   March 31, 2002        March 31, 2001*
                                                 ------------------    ------------------
<S>                                              <C>                   <C>
Revenues:
      Gas Processing Sales                       $          138,246    $          291,183
      Other                                                   3,623                12,413
                                                 ------------------    ------------------
           Total Revenues                                   141,869               303,596
                                                 ------------------    ------------------

Operating Expenses:
      Purchases                                              93,702               194,637
      Operating Expenses                                    121,031                48,182
      Depreciation, Depletion & Amortization                 17,833                10,961
      Interest                                               22,820                27,505
      General and Administrative                            264,786               168,827
                                                 ------------------    ------------------
         Total Operating Expenses                           520,172               450,112
                                                 ------------------    ------------------
Net (Loss) From Continuing Operations                      (378,303)             (146,516)
       (Loss) From Discontinued Operations
        (Note 2)                                                  0              (134,440)
                                                 ------------------    ------------------
Net (Loss)                                       $         (378,303)   $         (280,956)
                                                 ==================    ==================

Net (Loss) Per Common Share
      Basic
      Loss From Continuing Operations            $           (0.014)   $           (0.007)
      Loss From Discontinued Operations                      (0.000)               (0.007)
                                                 ------------------    ------------------
         Total                                   $           (0.014)   $           (0.014
                                                 ==================    ==================
Weighted Average Number of Common
      Shares Outstanding, Basic                          26,164,900            20,803,948
                                                 ==================    ==================

      Diluted
      Loss From Continuing Operations            $           (0.014)   $           (0.007)
      Loss From Discontinued Operations                      (0.000)               (0.007)
                                                 ------------------    ------------------
         Total                                   $           (0.014)   $           (0.014)
                                                 ==================    ==================
Weighted Average Number of Common
   Shares Outstanding, Diluted                           26,189,900            20,933,948
                                                 ==================    ==================
</TABLE>



*The statement of  consolidated  operations for the three months ended March 31,
2001 has been reclassified to conform with the December 31, 2001 presentation.




      See Accompanying Notes to Condensed Consolidated Financial Statements
                                       -5-


<PAGE>
<TABLE>
<CAPTION>

                         TIDELANDS OIL & GAS CORPORATION
                 STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS
                                   (UNAUDITED)

                                                    Three Months Ended    Three Months Ended
                                                      March 31, 2002        March 31, 2001
                                                    ------------------    ------------------
<S>                                                 <C>                   <C>
Cash Flows Provided (Required) By
  Operating Activities:
    Net (Loss)
      Continuing Operations                         $         (378,303)   $         (146,516)
      Discontinued Operations                                        0              (134,440)
    Adjustments to Reconcile Net (Loss)
         to Net Cash Provided (Required) By
         Operating Activities:

    Depreciation, Depletion and Amortization
         Continuing Operations                                  17,833                10,961
         Discontinued Operations                                     0                 6,588
    Issuance of Common Stock
         For Services Provided                                  78,706                     0
         For Litigation Settlement                                   0                17,000
    Officers' Salaries                                          60,000                60,000
     Changes in
         Accounts Receivable                                   (1,200)                17,327
         Inventory                                               (757)                 3,397
         Prepaid Expenses                                      (40,100)               25,728
         Other Assets                                              125                (1,132)
         Accounts Payable and Accrued Expenses                 (83,591)               69,934
         Current Maturities of Long-Term Debt                 (205,546)              (22,495)
                                                    ------------------    ------------------

Net Cash (Required)
   by Operating Activities                                    (552,833)              (93,648)
                                                    ------------------    ------------------
Cash Flows  (Required)
  By Investing Activities:
      Acquisitions of Property, Plant & Equipment             (121,538)               (3,191)
                                                    ------------------    ------------------

         Net Cash (Required)
            By Investing Activities                           (121,538)               (3,191)
                                                    ------------------    ------------------
</TABLE>



      See Accompanying Notes to Condensed Consolidated Financial Statements
                                       -6-

<PAGE>

                         TIDELANDS OIL & GAS CORPORATION
                 STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS
                                   (UNAUDITED)

                                   (CONTINUED)

                                                Three Months      Three Months
                                                    Ended             Ended
                                               March 31, 2002    March 31, 2001*
                                              ---------------    ---------------

Cash Flows Provided by Financing Activities
      Decrease Stock
      Subscription Receivable                               0             35,779
      Proceeds From Long-Term Loans                   131,983
      Issuance of Short-Term Debt Pursuant
       To Litigation Settlement                             0             75,000
      Proceeds of Loans From
       Related Parties                                282,563              2,272
                                              ---------------    ---------------


Net Cash Provided by Financing Activities             414,546            113,051
                                              ---------------    ---------------

Net Increase (Decrease) in Cash                      (259,825)            16,212
Cash at Beginning of Period                           397,491            312,509
                                              ---------------    ---------------
Cash at End of Period                         $       137,666    $       328,721
                                              ===============    ===============

Supplemental Disclosures of
   Cash Flow Information
      Cash Payments for Interest              $        11,772    $        28,078
                                              ===============    ===============

      Cash Payments for Income Taxes          $             0    $             0
                                              ===============    ===============
Non-Cash Financing Activities:
   Issuance of Common Stock:
      Operating Activities                    $        78,706    $             0
      Capital Contribution to Investments                   0             13,000
      Litigation Settlement                                 0             17,000
      Prepayment of Consulting Contract               788,334                  0
      Prepayment of Financing Fee                     832,000                  0
                                              ---------------    ---------------

      Total Non-Cash Financing Activities     $     1,699,040    $        30,000
                                              ===============    ===============



*The statement of  consolidated  cash flows for the three months ended March 31,
2001  has been  reclassified  (Note  2) to  conform  with  the  March  31,  2002
presentation.


      See Accompanying Notes to Condensed Consolidated Financial Statements
                                       -7-

<PAGE>

                         TIDELANDS OIL & GAS CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




NOTE 1 - BASIS OF PRESENTATION
------   ---------------------

         The accompanying  unaudited condensed consolidated financial statements
         for the three  month  periods  ended  March 31, 2002 and 2001 have been
         prepared in conformity with principles generally accepted in the United
         States  of  America  for  interim  financial  information  and with the
         instructions   to  Form  10-QSB  and  Regulation   S-B.  the  financial
         information  as of December 31, 2001 is derived  from the  registrant's
         Form 10-KSB for the year ended December 31, 2001.  Certain  information
         or  footnote  disclosures  normally  included in  financial  statements
         prepared in accordance with accounting principles generally accepted in
         the United States of America have been condensed or omitted pursuant to
         the rules and regulations of the Securities and Exchange Commission.

         The  preparation of financial  statements in conformity with accounting
         principles  generally accepted in the United States of America requires
         management to make estimates and  assumptions  that affect the reported
         amounts  of  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.  In
         the  opinion  of  management,  the  accompanying  financial  statements
         include all adjustments  necessary (which are of a normal and recurring
         nature) for the fair presentation of the results of the interim periods
         presented. While the registrant believes that the disclosures presented
         are  adequate  to keep the  information  from being  misleading,  it is
         suggested  that  these  accompanying  financial  statements  be read in
         conjunction  with  the  registrant's  audited  consolidated   financial
         statements and notes for the year ended December 31, 2001,  included in
         the registrant's Form 10-KSB for the year ended December 31, 2001.

         Operating  results for the three-month  period ended March 31, 2002 are
         not necessarily  indicative of the results that may be expected for the
         remainder of the fiscal year ending December 31, 2002. The accompanying
         unaudited  condensed  consolidated  financial  statements  include  the
         accounts  of the  registrant  and its  wholly-owned  subsidiaries.  All
         significant   inter-company   accounts  and   transactions   have  been
         eliminated in consolidation.



                                       -8-

<PAGE>

                         TIDELANDS OIL & GAS CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - DISCONTINUED OPERATIONS
------   -----------------------

         As a result of management  activities,  the Company  segregated  losses
         from  discontinued  operations  for its  December  31,  2001  financial
         statements.   Accordingly,  we  have  restated  herein,  the  Condensed
         Consolidated  Statement of Operations  for the three months ended March
         31, 2001 to reflect these losses from discontinued operations.

NOTE 3 - LITIGATION
------   ----------

         In June 2001,  the  Company  commenced  an action in the United  States
         District  court  for the  Southern  District  of Texas  against  Swartz
         Private Equity, LLC ("Swartz"). Shortly thereafter, Swartz commenced an
         action  in the  Superior  Court of  Fulton  County,  Georgia  which was
         removed to the United States  District Court for the Northern  District
         of  Georgia.  The Texas  action has been  transferred  to the  Northern
         District of Georgia and both  actions are being dealt with  jointly for
         discovery purposes.

         The Company seeks declaratory and rescissionary  relief seeking to have
         the Court  declare that the  agreements  between the Company and Swartz
         are void and  unenforceable and rescission in amounts to be established
         at trial which it alleges to be $20,000,000.

         The Swartz action seeks to enforce the agreements signed by the parties
         and the  issuance of  1,157,150  shares of common  stock,  payment of a
         claimed  termination  fee in the amount of $200,000 and damages for the
         alleged  failure of the  Company to issue the shares  claimed by Swartz
         including damages arising from any market fluctuations.  Alternatively,
         Swartz's  complaint  seeks a direction  to the Company to  specifically
         perform the agreements.

         In addition,  Swartz's complaint seeks damages in an unspecified amount
         for claimed defamation concerning Swartz.

         Further,  Swartz's complaint seeks damages in an unspecified amount for
         claimed  "international  interference  with  contractual  relations and
         intentional interference with business relations". The Swartz complaint
         also seeks punitive damages.

         The above two actions are in the discovery  stages. At this preliminary
         stage,  no  evaluation of the outcome of the  litigations  can be made.
         Management is responding to these  litigations  by vigorously  pressing
         its  position  and  contesting   those  taken  by  Swartz.   Settlement
         discussions  have been opened between the parties but have not resulted
         in any offer being made by either side which is seriously considered by
         the other.



                                       -9-

<PAGE>

                         TIDELANDS OIL & GAS CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




NOTE 4 - OTHER
------   -----

         The Company  issued  4,000,000  shares of restricted  common stock at a
         value of $1,692,000 for a three-year  financial  services  contract and
         arranging  $10,000,000  financing.  Management of the Company  believes
         that with the signing of this  contract,  funding  sources will be made
         available for construction of the international crossing facility to be
         located in Eagle Pass,  Texas,  along with significant  working capital
         for the Company.

         The Company issued 20,000 shares of restricted  common stock at a value
         of $7,040 for website planning and construction.

NOTE 5 - SUBSEQUENT EVENTS
------   -----------------

         On April 2, 2002, the company registered 1,000,000 shares of its common
         stock valued at $424,800 for use in payment of legal fees in connection
         with the Swartz Litigation described above and other ongoing matters.



                                      -10-
<PAGE>

Item 2. Management's Discussion and Analysis or Plan of Operation.

     The following  discussion  of our results of  operations  and liquidity and
capital resources should be read in conjunction with our condensed  consolidated
financial  statements  and related  notes  thereto  appearing  elsewhere in this
report.

OVERVIEW:

     The  Company  continues  to focus  its plan of  operation  on  natural  gas
processing and pipeline  transportation  and the  development  of  international
pipeline crossings into Mexico.

     The  Company  is  also  evaluating  other  pipeline  systems  for  possible
acquisitions.  Recently,  the  Company  executed  an  acquisition  agreement  to
purchase another  pipeline system which would add a substantial  amount of large
diameter  pipeline to our existing  system thereby  increasing our available gas
supply for transportation to Mexico through our proposed  international pipeline
crossings.  We anticipate  that this  acquisition  will be completed in the near
future.

     Additionally,  we will be adding more natural gas  gathering  lines to this
new system  which will add to our gas supply  for the  existing  gas  processing
plant.  Revenues will also be increased by the  through-put of the gas plant and
thereby increase propane/butane sales.

     During 2001, we formed an additional  affiliate,  Reef International,  LLC.
Reef is in the final stage of obtaining the necessary  State and Federal permits
for the construction of the international  pipeline crossing between Eagle Pass,
Texas and Piedras,  Mexico.  Approvals have been secured from the State of Texas
for these  permits.  Federal  permits have been approved and we are awaiting the
signatures from the federal agencies.

     All engineering and  construction  studies have been finalized and approved
by the State and Federal  agencies.  We are awaiting the issuance of the Federal
permit and the necessary  pipeline  construction  financing before  construction
commences.

     In  addition  to  the  Eagle  Pass/Piedras  Negras,  Mexico  crossing  Reef
International,   LLC.  has  commenced  the  permitting   process  for  a  second
international crossing at El Paso, Texas to Juarez, Mexico.

     Tideland's  President and CEO, Michael Ward, has been invited to attend the
Texas Trade & Investment Mission conference to be held in Mexico City, Mexico on
May 15-17th,  2002.  Mr. Ward has been asked to prepare a  presentation  for the
conference  relating to our  permitting  experience  and  construction  planning
process for our international pipeline crossings. This energy conference will be
attended by all sectors of the  natural  gas  industry in the United  States and
Mexico.  The  purpose of this  mission  and  conference  is to  promote  similar
international energy projects.

                                      -11-

<PAGE>

RESULTS OF OPERATIONS

REVENUES:  The Company reported revenues of $141,869 from continuing  operations
for the three  months  ended  March 31,  2002 as  compared  with  revenues  from
continuing  operations of $303,596 for the three months ended March 31,2001. The
revenue  reductions  were due  primarily  to decreases in the sales price of gas
related products.

TOTAL COSTS AND EXPENSES:  Total costs and expenses from  continuing  operations
increased  from  $450,112  for the three months ended March 31, 2001 to $520,172
for the three months ended March 31, 2002.

COST OF  SALES:  The  cost  of  sales  (purchases)  from  continuing  operations
decreased from $194,637 for the three months ended March 31, 2001 to $93,702 for
the three months ended March 31, 2002.  The  reduction of $100,935 was primarily
due to reduction of gas purchase prices during the period.

OPERATING  EXPENSES:   Other  operating  expenses  from  continuing   operations
increased from $48,182 for the three months ended March 31, 2001 to $121,031 for
the three months ended March 31, 2002. The increase of $72,849 consisted for the
most part of costs  associated  with the  redeployment  of certain  personnel to
pipeline maintenance.

SELLING GENERAL AND ADMINISTRATIVE EXPENSES:  Selling general and administrative
expenses from continuing operations increased from $168,827 for the three months
ended March 31, 2001 to $264,786 for the three months ended March 31, 2002.  The
increase of $95,959 in 2002 is  substantially  due to higher personnel costs and
increased consulting fees.

INCOME TAX: The pretax loss increased from ($280,956) for the three months ended
March 31,2001 to ($378,303) for the three months ended March 31,2002 as increase
of$97, 347.

LIQUIDITY AND CAPITAL RESOURCES:  Capital  expenditures  during the three months
ended March 31, 2002 totaled  $121,538 as compared  with $3,191 during the three
months ended March 31,  2001.  The  increase of $118,347  consists  primarily of
pre-construction costs regarding our proposed international crossing to Mexico.

Total debt increased from $3,840,674 at December 31, 2001 to $4,026,083 at March
31, 2002 of which $1,229,305 was unpaid officer's and directors  salaries,  fees
and expense  reimbursements and $647,363 was loans from officers.  Total debt as
of March 31, 2002 and December  31,2001  expressed as a percentage of the sum of
total debt and shareholders' equity was 127.2% and 231.6% respectively.

Net loss for the three months ended March 31,2002 was  ($378,303) an increase of
34.5% from the net loss of ($280,956) for the three months ended March 31, 2001.
Diluted net loss per common share of ($0.014)  remained  the same.  The net loss
per share  calculation  for the three  months  ended March 31, 2002  included an
increase in actual and equivalent shares outstanding.

FORWARD-LOOKING STATEMENTS:

     We have  included  forward-looking  statements  in this  report.  For  this
purpose,  any  statements  contained in this report that are not  statements  of

                                      -12-

<PAGE>

historical fact may be deemed to be forward looking statements. Without limiting
the foregoing, words such as "may", "will", "expect",  "believe",  "anticipate",
"estimate",  or  "continue"  or the  negative  or other  variations  thereof  or
comparable  terminology  are  intended to identify  forward-looking  statements.
These statements by their nature involve  substantial  risks and  uncertainties,
and actual  results  may differ  materially  depending  on a variety of factors.
Factors that might cause  forward-looking  statements to differ  materially from
actual  results  include,  among other  things,  overall  economic  and business
conditions,  demand  for the  Company's  products,  competitive  factors  in the
industries  in which we compete or intend to compete,  natural gas  availability
and cost and timing,  impact and other  uncertainties of our future  acquisition
plans.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK:

     The  Company  does not issue or invest in  financial  instruments  or their
derivatives for trading or speculative  purposes.  The operations of the Company
are conducted  primarily in the United States,  and, are not subject to material
foreign  currency  exchange risk.  Although the Company has outstanding debt and
related  interest  expense,  market risk of interest rate exposure in the United
States is currently not material.


                           PART II- OTHER INFORMATION

Item 1.  Legal Proceedings.

     In June 2001, the Company commenced an action in the United States District
Court for the Southern  District of Texas against  Swartz  Private  Equity,  LLC
("Swartz"). Shortly thereafter, Swartz commenced an action in the Superior Court
of Fulton County,  Georgia which was removed to the United States District Court
for the Northern  District of Georgia.  The Texas action has been transferred to
the  Northern  District of Georgia and both actions are being dealt with jointly
for discovery purposes.

     The Company seeks declaratory and rescissionary  relief seeking to have the
Court  declare that the  agreements  between the Company and Swartz are void and
unenforceable  and  rescission  in amounts to be  established  at trial which it
alleges to be $20,000,000.

     The Swartz action seeks to enforce the agreements signed by the parties and
the  issuance  of  1,157,150  shares  of  common  stock,  payment  of a  claimed
termination fee in the amount of $200,000 and damages for the alleged failure of
the Company to issue the shares claimed by Swartz including damages arising from
any market fluctuations.  Alternatively, Swartz's complaint seeks a direction to
the Company to specifically perform the agreements.

     In addition,  Swartz's complaint seeks damages in an unspecified amount for
claimed defamation concerning Swartz.

     Further,  Swartz's  complaint  seeks damages in an  unspecified  amount for
claimed  "international  interference with contractual relations and intentional
interference with business relations".  The Swartz complaint also seeks punitive
damages.

     The above two  actions are in the  discovery  stages.  At this  preliminary
stage, no evaluation of the outcome of the  litigations can be made.  Management


is  responding  to these  litigations  by  vigorously  pressing its position and
contesting  those  taken by  Swartz.  Settlement  discussions  have been  opened
between the parties but have not resulted in any offer being made by either side
which is seriously considered by the other.


Item 2. Changes in Securities and Use of Proceeds

     Recent Sales of Unregistered Securities

     During  the  first  quarter  of  2002,  the  Company  offered  and sold the
following  securities pursuant to exemptions from the registration  requirements
of the Securities Act of 1933, as amended.

     On January 8, 2002, the Company issued  2,000,000  common shares to Redec &
Associates,  LLC as consideration for a three-year financial consulting services
contract valued at $860,000.

     On January 25, 2002, the Company issued  2,000,000 common shares to Redec &
Associates,  LLC valued at $832,000  for  assisting  the company with the future
procurement of a $10,000,000  financing in connection  with the  construction of
our  proposed  international  pipeline.  The future  financing is subject to the
issuance of the international pipeline permits and firm financing commitments.

     On March 1, 2002, the Company issued 20,000 common shares to Momentum Group
for website planning and construction services valued at $7,040.

                                      -13-

<PAGE>

     The shares issued above were issued in a private  transactions  pursuant to
Section 4(2) of the Securities Act of 1933, as amended,  (the "Securities Act").
These shares are considered restricted securities and may not be publicly resold
unless  registered for resale with appropriate  governmental  agencies or unless
exempt from any applicable registration requirements.

Item 3. Defaults Upon Senior Securities.

     None.

Item 4. Submission of Matters to a Vote of Security Holders.

     No matter was  submitted  to a vote of the  security  holders,  through the
solicitation  of proxies or  otherwise,  during the first  quarter of the fiscal
year covered by this report.


Item 5. Other Information.

     None.

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

     (a) Exhibits

     (b) Reports on Form 8-K. No reports were filed  during the quarter  covered
by this report.

                                      -14-

<PAGE>

SIGNATURES

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

Dated: May 8, 2002

TIDELANDS OIL & GAS CORPORATION


 /s/ Michael Ward
--------------------------
By: Michael Ward
Title: President

 /s/ Royis Ward
--------------------------
By: Royis Ward
Title: Secretary/Treasurer

 /s/ Ahmmed Karim
--------------------------
By: Ahmmed Karim
Title: Vice President




                                      -15-