SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON D.C. 20549

                             ----------------------

                                    FORM 10-Q

               Quarterly Report Pursuant to Section 13 or 15(d) of

                       the Securities Exchange Act of 1934

                         For the quarterly period ended

                               SEPTEMBER 30, 1999

                           COMMISSION FILE NO. 333-608

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.
             (Exact name of registrant as specified in its charter)

                   PHILIPPINES                    NOT APPLICABLE
      (State or other jurisdiction of          (I.R.S. Employer

       incorporation or organization)           Identification No.)

      6750 Ayala Avenue, 24th Floor

      MAKATI, METRO MANILA PHILIPPINES            NOT APPLICABLE
  (Address of principal executive offices)         (Zip Code)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (632) 892-0276

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                           YES    X                                    NO

FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE LAST
REPORT.  NOT APPLICABLE

767,162  shares  of  Common  Stock,  $0.038  par value  were  outstanding  as of
September 30, 1999.

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                                    Form 10-Q

                               September 30, 1999

                                  -------------

                                 C O N T E N T S

PART I:  FINANCIAL INFORMATION                                              Page

ITEM 1.           Financial Statements

Report of Independent Public Accountants                                     3

Balance Sheets, September 30, 1999 and December 31, 1998                     4

Statements of Operations for the Three and Nine Months Ended  September 30, 1999
and 1998 and for the period from inception (September 21, 1994) to September 30,
1999 5

Statements  of Cash Flows for the Nine Months Ended  September 30, 1999 and 1998
and for the period from inception (September 21, 1994) to September 30, 1999 6

Notes to Financial Statements                                                7

ITEM 2.         Management's Discussion and Analysis of Financial Condition and

                Results of Operations                                        8

PART II:  OTHER INFORMATION

ITEM 1.         Legal Proceedings                                            11

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ITEM 2.         Changes in Securities                                        11

-------
ITEM 3.         Defaults on Senior Securities                                11

-------
ITEM 4.         Submission of Matters to a Vote of Security Holders          11
-------
ITEM 5.         Other Information                                            11

-------
ITEM 6.         Exhibits and Reports on Form 8-K                             11
-------

Signatures                                                                   12

Exhibit 27                                                                   13


<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

The Stockholders and the Board of Directors
CE Casecnan Water and Energy Company, Inc.

We have reviewed the accompanying  balance sheet of CE Casecnan Water and Energy
Company, Inc. (a company in the development stage) as of September 30, 1999, and
the  related  statements  of  operations  for the  three and nine  months  ended
September 30, 1999 and 1998 and the period from  inception  (September 21, 1994)
to September  30, 1999,  and cash flows for the nine months ended  September 30,
1999 and 1998 and the period from  inception  (September  21, 1994) to September
30, 1999.  These financial  statements are the  responsibility  of the Company's
management.

A review of interim  financial  information  consists  principally  of  applying
analytical  procedures  to  financial  data  and  making  inquiries  of  persons
responsible for financial and accounting  matters.  It is substantially  less in
scope than an audit  conducted in accordance with auditing  standards  generally
accepted  in the  United  States  of  America,  the  objective  of  which is the
expression of an opinion regarding the financial statements taken as a whole.

Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material  modifications that should
be  made  to the  financial  statements  referred  to  above  for  them to be in
conformity with accounting principles generally accepted in the United States of
America.

We have audited in accordance with auditing standards  generally accepted in the
United  States of  America,  the balance  sheet of CE Casecnan  Water and Energy
Company,  Inc. as of December 31, 1998, and the related statements of operations
for the  year  ended  December  31,  1998,  and for the  period  from  inception
(September 21, 1994) to December 31, 1998,  changes in stockholders'  equity for
the period from  inception  (September  21,  1994) to December 31, 1998 and cash
flows for the year ended  December 31, 1998,  and for the period from  inception
(September 21, 1994) to December 31, 1998 (not presented separately herein) and,
in our report dated  January 20, 1999,  we expressed an  unqualified  opinion on
those financial statements.

SYCIP GORRES VELAYO & CO.

An Arthur Andersen Member Firm

Makati City, Philippines
November 08, 1999

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                                 BALANCE SHEETS
               (in thousands, except share and per share amounts)

                        --------------------------------

                                         September 30,        December 31,

                                            1999           1998
                                            -------------  ----
                                        (unaudited)

ASSETS

Cash                                            $      2,437 $       1,996
Restricted cash and short-term investments            77,188       145,958
Accrued interest and other receivables                 3,166         3,014
Restricted investments                               121,614       122,341
Bond issue costs - net                                 9,341        10,334
Development and construction costs                   311,267       261,563
DEFERRED INCOME TAX                                    8,010         8,227
                                                    --------      --------

   TOTAL ASSETS                                  $   533,023 $     553,433
                                                  ==========   ===========


LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Accounts payable and accrued expenses            $    55,942 $      82,635
Advances from an affiliate                             6,288           756
NOTES AND BONDS PAYABLE                              371,500       371,500
                                                   ---------   -----------

   TOTAL LIABILITIES                                 433,730       454,891
                                                   ---------    ----------

Stockholders' equity:

Common stock - par value $0.038 per share,
   authorized 2,148,000 shares, issued and

   outstanding 767,162 shares                             29            29
Additional paid-in capital                           123,807       123,807
ACCUMULATED DEFICIT                                  (24,543)      (25,294)
                                                    --------     ---------
TOTAL STOCKHOLDERS' EQUITY                            99,293        98,542
                                                    --------     ---------

   TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $   533,023  $    553,433
                                                 ===========   ===========


                     The  accompanying  notes  are an  integral  part  of  these

financial statements.

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                       UNAUDITED STATEMENTS OF OPERATIONS
               (in thousands, except share and per share amounts)

                        --------------------------------


                                                                  From Inception

                             Three Months Ended Nine Months Ended Sept. 21,1994)
                                September 30,     September 30,         to
                                1999      1998      1999     1998 SEPT. 30, 1999

                                ----      ----      ----     ---- --------------
Revnues:

INTEREST AND OTHER INCOME   $ 2,665   $ 5,159   $ 8,958  $ 15,203  $ 76,381
                            -------   -------   -------  --------  --------

TOTAL REVENUES                2,665     5,159     8,958    15,203    76,381
                            -------   -------   -------  --------   -------
Costs and expenses:

Interest expense - net

of interest capitalized       1,935     3,844     6,997    14,776   104,685

AMORTIZATION OF BOND

  ISSUE COSTS                   331       295       993       884     4,249
                           -------- ---------  -------- --------- ---------

TOTAL COSTS AND EXPENSES      2,266     4,139     7,990    15,660   108,934
                           -------- ---------  -------- --------- ---------

Net income (loss) before

income tax                      399     1,020       968      (457)  (32,553)

Benefit from (provision for)

deferred income tax             (90)     (219)     (217)      112     8,010
                           -------- ---------  -------- --------- ---------

Net income (loss) to common

stockholders                $   309   $   801   $   751   $  (345)$ (24,543)
                           ======== ========= ========= ========= =========

NET INCOME (LOSS)

  PER SHARE                 $  0.40   $  1.04   $  0.98  $  (0.45)$  (34.23)
                           ======== ========= ========= ========= =========

Average number of common

shares outstanding          767,162   767,162   767,162   767,162   716,993
                          ========= ========= ========= ========= =========

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

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                       UNAUDITED STATEMENTS OF CASH FLOWS

                                 (in thousands)

                        --------------------------------


                                          Nine Months Ended    From Inception
                                            September 30,  (September 21, 1994)

                                           1999       1998   to Sept. 30, 1999
                                           ----       ----  ------------------

Cash flows from operating activities:

Net income (loss)                   $     751   $    (345)    $  (24,543)

Adjustments to reconcile net income (loss)
to net cash  provided by (used in)
operating activities:
Provision for (Benefit from)
deferred income tax                       217        (112)        (8,010)
Amortization of bond issue costs          993         884          4,249
Increase in accrued interest and other
Receivables                              (152)        (75)        (3,166)
Increase in accounts payable and
accrued expenses                        9,584       9,439         18,234
                                      -------     -------      ---------

Net cash provided by (used in)
operating activities                   11,393       9,791        (13,236)
                                      -------     -------      ---------

Cash flows from investing activities:
Additions to development and
 construction costs                   (49,704)    (75,248)      (311,267)
Decrease (increase) in restricted cash
 and short-term investments            68,770       3,638        (77,188)
Decrease (increase) in restricted
 investments                              727       4,595       (121,614)
Increase (decrease) in accounts payable and
 accrued expenses related to development
 and construction activities          (36,277)     61,612         37,708
                                    ---------  ----------  -------------

Net cash used in investing activities (16,484)     (5,403)      (472,361)
                                    ---------  ----------  -------------

Cash flows from financing activities:
Increase (decrease) in advances
 from an affiliate                      5,532      (2,812)         6,288
Issuance of bonds payable                   -           -        371,500
Proceeds from issuance of capital stock     -           -             29
Additional paid-in capital                  -           -        123,807
BOND ISSUE COSTS                            -           -        (13,590)
                                    ---------  ----------  -------------

Net cash provided by (used in)
 financing activities                   5,532      (2,812)       488,034
                                    ---------  ----------  -------------
Net increase in cash and cash
 equivalents                              441       1,576          2,437
Cash at beginning of period             1,996         547              -
                                    ---------  ----------  -------------
Cash at end of period              $    2,437  $    2,123   $      2,437
                                   ==========  ==========   ============
Supplemental disclosure:
Interest paid (net of amount

 capitalized)                        $ (2,587) $   (1,118)  $     89,257
                                   ==========  ==========  =============

                              The  accompanying  notes are an  integral  part of

these financial statements.

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                          NOTES TO FINANCIAL STATEMENTS
                    (in thousands, except per share amounts)

                        --------------------------------

1.   GENERAL:

In the opinion of management of CE Casecnan Water and Energy Company,  Inc. ("CE
Casecnan" or the "Company"),  the accompanying  unaudited  financial  statements
contain all adjustments (consisting only of normal recurring accruals) necessary
to present  fairly the  financial  position  as of  September  30,  1999 and the
results of operations for the three and nine months ended September 30, 1999 and
1998 and the period from  inception  (September 21, 1994) to September 30, 1999,
and cash flows for the nine  months  ended  September  30, 1999 and 1998 and the
period from inception (September 21, 1994) to September 30, 1999.

The results of operations for the three and nine months ended September 30, 1999
and 1998 are not  necessarily  indicative  of the results to be expected for the
full year.

2.   OTHER FOOTNOTE INFORMATION:

Reference  is  made  to  the  Company's  December  31,  1998  audited  financial
statements included in Form 10-K that included  information  necessary or useful
to  the  understanding  of  the  Company's  business  and  financial   statement
presentations.  In particular, the Company's significant accounting policies and
practices were presented as Note 2 to the financial  statements included in that
report.

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

                    (in thousands, except per share amounts)

                        --------------------------------

RESULTS OF OPERATIONS:

The  Company is in the  construction  stage and has not yet  started  commercial
operations.  Revenue  consists of  interest  income on cash  received  from bond
proceeds  and  equity  contributions.  Interest  income  decreased  in the third
quarter  of 1999 to  $2,665  from  $5,159 in the same  period  in 1998,  a 48.3%
decrease.  For the  nine  months  ended  September  30,  1999,  interest  income
decreased  41.1% to $8,958  from  $15,203  for the same  period  in 1998.  These
decreases  are  primarily  due to lower cash balances due to the use of existing
cash to support the ongoing construction activities.

Interest  expense in the third  quarter of 1999 was $11,250  compared to $10,962
for the same period in 1998.  For the nine months ended  September  30, 1999 and
1998,  interest  expense  was  $33,655 and  $34,005,  respectively.  Capitalized
interest in the third quarter 1999  increased to $9,315 from $7,118 for the same
period in 1998, a 30.9% increase.  For the nine months ended September 30, 1999,
capitalized  interest  increased  to $26,658 from $19,229 for the same period in
1998, a 38.6%  increase.  The increases in  capitalized  interest  resulted from
higher cumulative development and construction costs. Amortization of bond issue
costs for the three and nine month  periods  ended  September 30, 1999 were $331
and $993,  respectively,  compared to $295 and $884 for the same period in 1998.
Interest  expense,  capitalized  interest and  amortization  of bond issue costs
relate to the  notes and bonds  payable  issued  by the  Company  in the  fourth
quarter of 1996.

LIQUIDITY AND CAPITAL RESOURCES:

The Company  financed a portion of the costs of the Casecnan Project through the
issuance  of  $125,000  of its 11.45%  Senior  Secured  Series A Notes due 2005,
$171,500 of its 11.95% Senior Secured Series B Bonds due 2010 and $75,000 of its
Secured  Floating  Rate  Notes  due  2002  (the  "Securities"),  pursuant  to an
indenture (the "Indenture") dated as of November 27, 1995, as amended to date.

The  Securities  are senior debt of the Company and are secured by a  collateral
assignment of all revenues received from the Project, a collateral assignment of
all material  contracts,  a lien on any  accounts  and funds on deposit  under a
Deposit and Disbursement Agreement, a pledge of 100% of the capital stock of the
Company and a lien on all other  material  assets and property.  The  Securities
rank pari  passu  with and will  share the  collateral  on a pro rata basis with
other senior secured debt, if any.

The Securities are subject to certain optional and mandatory  redemption schemes
as defined in the Indenture.  The Securities contain customary events of default
and restrictive covenants.

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

                    (in thousands, except per share amounts)

                        --------------------------------

LIQUIDITY AND CAPITAL RESOURCES (CONTINUED):

The  Casecnan   Project  is  being   constructed   pursuant  to  a  fixed-price,
date-certain,  turnkey  engineering,  procurement and  construction  contract to
complete the construction of the Casecnan Project (the "EPC Contract"). The work
under  the  EPC  Contract  is  being  conducted  by CP  Casecnan  Consortium,  a
consortium  consisting of  Cooperativa  Muratori  Cementisti  CMC di Ravenna and
Impresa Pizzarotti & C. Spa, and Siemens A.G., Sulzer Hydro Ltd., Black & Veatch
and  Colenco  Power  Engineering  Ltd.  (collectively,  the  "Contractor").  The
Casecnan Project, which was expected to become operational in the fourth quarter
of 2000, is now expected to become  operational in the first quarter of 2001 due
to certain recent delays experienced by the Contractor. The Company is currently
assessing the impact of these delays with the Contractor.

What is generally  known as the year 2000  computer  issue ("Y2K") arose because
many  existing  computer  programs  and  embedded  systems use only the last two
digits to refer to a year.  Therefore,  those computer  programs do not properly
distinguish  between  a year  that  begins  with "20"  instead  of "19".  If not
corrected,  it is anticipated  many computer  applications  could fail or create
erroneous results. The failure to correct a material Y2K item could result in an
interruption  in,  or a  failure  of,  certain  normal  business  activities  or
operations  including the  generation,  distribution  and supply of electricity.
Such failures  could  materially and adversely  affect the Company's  results of
operations, liquidity and financial condition.

The Y2K issue creates uncertainty for the Company from potential issues with its
own  computer  systems and from third  parties  with whom the  Company  deals on
transactions  worldwide.  The Company's operations utilize systems and equipment
provided by other  organizations.  As a result,  Y2K  readiness of  contractors,
suppliers,  vendors,  service  providers or customers could impact the Company's
operations.  The Company is assessing the readiness of such constituent entities
and the impacts on those  entities  that rely upon the Company's  services.  The
Company is unable to  determine  at this time  whether the  consequences  of Y2K
failures of third parties will have a material  impact on the Company's  results
of operations, liquidity, or financial condition.

The  Company  has  commenced,  for all of its  information  systems,  a Y2K date
conversion   project  to  address  all  necessary  code  changes,   testing  and
implementation in order to resolve the Y2K issue. The Company has identified and
assessed  substantially all of its IT and non-IT systems and is currently in the
process of repairing or replacing  those  systems which it believes are not year
2000  compliant.  As the  Casecnan  Project is  expected  to be in  construction
through  the year  2000,  the Y2K  problem in regard to  Casecnan's  operational
assets  cannot be tested by the Company  until  construction  is complete.  This
compliance is the obligation of the contractor until completion of construction.

<PAGE>

                   CE CASECNAN WATER AND ENERGY COMPANY, INC.

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

                    (in thousands, except per share amounts)

                        --------------------------------

LIQUIDITY AND CAPITAL RESOURCES (CONTINUED):

Total Y2K expenditures,  for both repairing or replacing  non-compliant systems,
are not  expected to be  material.  The  Company is not aware of any  additional
material  costs  needed  to be  incurred  to  bring  all  of  its  systems  into
compliance;  however,  there is no assurance that  additional  costs will not be
incurred.

A contingency plan identifying credible worst-case scenarios is being developed.
The  contingency  plan is comprised  of both  mitigation  and recovery  aspects.
Mitigation  entails  planning  to  reduce  the  impact of  unresolved  year 2000
problems,  and recovery  entails  planning to restore services in the event that
year 2000 problems occur. Although such plans are substantially  complete,  they
will be  refined  throughout  the  remainder  of the year,  based on  results of
contingency planning drills and other changes in circumstances.

Although management believes that the Y2K project will be substantially complete
before  January 1, 2000,  unforeseen  failures  of the  Company's  and/or  third
parties'  computer systems could have a material impact on the Company's ability
to conduct its business.

Certain information included in this report contains forward-looking  statements
made pursuant to the Private  Securities  Litigation Reform Act of 1995 ("Reform
Act"). Such statements are based on current expectations and involve a number of
known and unknown risks and  uncertainties  that could cause the actual  results
and  performance of the Company to differ  materially  from any expected  future
results or performance, expressed or implied, by the forward-looking statements.
In connection with the safe harbor provisions of the Reform Act, the Company has
identified   important  factors  that  could  cause  actual  results  to  differ
materially   from  such   expectations,   including   development   uncertainty,
uncertainties  relating to construction (and in particular tunneling) activities
and SCHEDULE,  operating  uncertainty,  acquisition  uncertainty,  uncertainties
relating to doing business outside of the United States,  uncertainties relating
to  domestic  and   international   economic  and   political   conditions   and
uncertainties regarding the impact of regulations, changes in government policy,
industry deregulation and competition. Reference is made to all of the Company's
SEC  filings,  incorporated  herein  by  reference,  for a  description  of such
factors.  The  Company  assumes  no  responsibility  to  update  forward-looking
information contained herein.

<PAGE>

CE CASECNAN WATER AND ENERGY COMPANY, INC.

PART II - OTHER INFORMATION

ITEM 1 - Legal proceedings.

         Not applicable.

ITEM 2 -     Changes in Securities.

         Not applicable.

ITEM 3 - Defaults on Senior Securities.

         Not applicable.

ITEM 4 - Submission of Matters to a Vote of Security Holders.

         Not applicable.

ITEM 5 - Other Information.

         Not applicable.

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

     (a) Exhibits:

         Exhibit 27 - Financial Data Schedule

     (b) Reports on Form 8-K:

         Not applicable.

<PAGE>

SIGNATURES

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

                                      CE CASECNAN WATER AND ENERGY COMPANY, INC.

DATE: NOVEMBER 12, 1999                        /S/  PATRICK J. GOODMAN
                                     -------------------------------------------
                                                   Patrick J. Goodman

                                 Senior Vice President & Chief Financial Officer