<PAGE>   1



                       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  OF 1934

                  For the quarterly period ended September 30, 1999

    [ ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934


          For the transition period from _______________ to ________________


                        Commission file number 33-16110-D


                       SOUTHWESTERN WATER EXPLORATION CO.
        (Exact name of small business issuer as specified in its charter)


            COLORADO                                      84-1062895
 (State or other jurisdiction of               (IRS Employer Identification No.)
  incorporation or organization)


                      615 MACLEOD TRAIL S.E., SUITE 1100A,
                 ROCKY MOUNTAIN PLAZA, CALGARY, ALBERTA T2G 4T8
                    (Address of principal executive offices)


                                 (403) 531-2630
                           (Issuer's telephone number)


                         ______________________________


     Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period than the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes [ ]   No [X]

     As of December 6, 1999, the Registrant had 9,744,120 shares of common stock
outstanding.

     Documents Incorporated by Reference: Exhibits in the Registration Statement
on Form 10-KSB dated May 4, 1998.


          Transitional Small Business Disclosure Format: Yes [ ] No [X]





<PAGE>   2

                                     PART I
                              FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS.

         The following financial statements are filed as a part of this Form
10-QSB:

         Financial Statements                                     Page
         --------------------                                     ----

         Consolidated Balance Sheet                                5

         Consolidated Statement of Loss and Deficit                6






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                       SOUTHWESTERN WATER EXPLORATION CO.

                       CONSOLIDATED FINANCIAL STATEMENTS

                               SEPTEMBER 30, 1999

                        (Unaudited-See Notice to Reader)

                          (Expressed in U.S. dollars)

<PAGE>   4
P. F. TURNER PROFESSIONAL CORPORATION
Chartered Accountant



                                NOTICE TO READER

I have compiled the consolidated balance sheet of Southwestern Water
Exploration Co. as at September 30, 1999 and the consolidated statements of
loss and deficit for the six months then ended from information provided by
management. I have not audited, reviewed or otherwise attempted to verify the
accuracy or completeness of such information. Readers are cautioned that these
statements may not be appropriate for their purposes.



Calgary, Alberta                        P. F. TURNER PROFESSIONAL CORPORATION
November 17, 1999                       CHARTERED ACCOUNTANT


<PAGE>   5
SOUTHWEST WATER EXPLORATION CO.
CONSOLIDATED BALANCE SHEET
AS AT SEPTEMBER 30, 1999

(Unaudited-See Notice to Reader)

(Expressed in U.S. dollars)
================================================================================
<TABLE>
<CAPTION>

                                                          1999         1998
                                                      -----------   -----------
<S>                                                   <C>           <C>

                                     ASSETS
CURRENT
  Cash                                                $        --   $         3
  Prepaid expenses                                             --           698
  Shareholders' loan                                        5,509            --
--------------------------------------------------------------------------------
                                                            5,509           701

LICENSES AND OTHER ASSETS                                     201           201

CAPITAL ASSETS (Note)                                       3,779         4,738
--------------------------------------------------------------------------------
                                                      $     9,489   $     5,640
================================================================================

                                  LIABILITIES
CURRENT
  Bank indebtedness                                   $        42   $        --
  Accounts payable                                         57,637        28,621
  Due to associated company                               711,360       737,786
  Shareholders' loan                                           --         7,931
--------------------------------------------------------------------------------
                                                          769,039       774,338

MINORITY INTEREST                                          24,975        24,975
--------------------------------------------------------------------------------
                                                          794,014       799,313
--------------------------------------------------------------------------------

                            SHAREHOLDERS' DEFICIENCY

SHARE CAPITAL (Note)                                      970,510       843,654

DEFICIT                                               $(1,755,035)  $(1,637,327)
--------------------------------------------------------------------------------
                                                         (784,525)     (793,673)
--------------------------------------------------------------------------------
                                                      $     9,489   $     5,640)
================================================================================
</TABLE>


                                             P F Turner Professional Corporation
                                                           Chartered Accountants
<PAGE>   6
SOUTHWESTERN WATER EXPLORATION CO.
CONSOLIDATED STATEMENT OF LOSS AND DEFICIT
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1999

(Unaudited-See Notice to Reader)

(Expressed in U.S. dollars)
================================================================================

<TABLE>
<CAPTION>
                                                1999            1998
                                            -----------     -----------
<S>                                         <C>             <C>
REVENUE
 Interest Income                                     10              15
--------------------------------------------------------------------------------
                                                     10              15
--------------------------------------------------------------------------------

EXPENSES
 Development expenses                                --          53,400
 Amortization                                       420             249
 Bank charges and interest                          102              42
 Office supplies                                  7,508           3,009
 Professional fees                                5,210           7,278
 Telephone and utilities                            117              --
 Promotion and entertainment                        160              --
 Travel and lodging                               2,724              --
--------------------------------------------------------------------------------
                                                 16,241          63,978
--------------------------------------------------------------------------------

LOSS BEFORE OTHER ITEMS                         (16,231)        (63,963)

FOREIGN EXCHANGE LOSS(GAIN)                        (298)             --
--------------------------------------------------------------------------------

NET LOSS                                        (15,933)        (63,963)

DEFICIT, beginning of year                   (1,739,102)     (1,573,364)
--------------------------------------------------------------------------------
                                             (1,755,035)     (1,637,327)
--------------------------------------------------------------------------------

DEFICIT, end of year                        $(1,755,035)    $(1,637,327)
================================================================================
</TABLE>


                                             P F Turner Professional Corporation
                                                           Chartered Accountants



<PAGE>   7


Factors Affecting Future Operating Results:

         LIMITED OPERATING HISTORY AND CONTINUING LOSSES.

         The Company has a limited operating history which makes an evaluation
of its business operations and future prospects difficult. The Company has had
no revenues from operations in the last three fiscal years. The Company has
incurred operating losses and negative cash flow each quarter and each year
since 1993. The Company's accumulated deficit was $1,755,035 at September 30,
1999. The Company believes it will continue to experience net losses on a
quarterly and annual basis for the foreseeable future.

         ABILITY TO COMPLETE NEVADA PROJECT UNPROVEN.

         The Company believes a significant portion of its revenues, if any,
will be generated by the Nevada Project. The exploration and utilization of deep
water reservoirs to provide potable water to municipalities will require
substantial financial, operational and management resources. The Company has not
been able to implement its plans due to insufficient financial resources. As a
result, the Company's ability to locate substantial deep water reservoirs
capable of being utilized or sold is unknown. The Company's inability to locate
and utilize significant water reserves capable of being transported to the end
user would have a material adverse effect on the Company's operations and
financial condition.

         NEED FOR ADDITIONAL FINANCING.

         The Company's ability to pursue the Nevada Project and implement its
business strategy is substantially dependant upon its ability to locate
additional financing in the amount of at least $500,000. The exact amount of
additional financing required will depend on various factors including the
following: the ability of the Company to enter into an agreement with a
municipality or water provider, the speed with which the water extraction can be
completed, the ability of the Company to arrange for transport of the water to
the end user and the ability of the Company to obtain local, state and federal
approvals. There can be no assurance that the Company will be able to obtain the
funds necessary to exploit the Database, complete the Nevada Project or to
otherwise conduct its business.





<PAGE>   8

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

General

         Southwestern Water Exploration Co. (the "Company"), was incorporated in
the State of Colorado on June 10, 1987. The Company's activities from inception
consisted primarily of reviewing possible business opportunities and
acquisitions, and maintaining the business entity. The Company had only nominal
net assets and no operational activities from the fiscal years 1987 through 1993
and all expenses incurred were solely related to maintaining the entity and
reviewing potential business opportunities.

         The Company intends to develop and market potable water throughout the
American Southwest. During its development stage, the Company acquired the
Database which it believes will provide surface drilling locations to mine deep
(below 2,000 ft) subsurface aquifers.

         The Company has identified a number of sites which it believes will
provide potable water, including a significant water reservoir in Nevada, by
utilizing the Database. Once developed, it is the intent of the Company to
market the water from these sites. If the marketing effort is unsuccessful, the
Company intends to sell the water rights to these sites. The Database provides
specific information including surface location, depth(s) of aquifers,
temperature, production capability, and mineral properties from wells previously
drilled for hydrocarbons and subsequently abandoned.

         Management believes that the Company can satisfy its cash requirements
from existing funds for another three months. The Company intends to meet its
future capital needs by raising additional funds through a private placement of
its securities. The Company anticipates that funding of future operations will
be provided by the completion of this private placement for a minimum of $1.5
million. There can be no assurances, however, that the Company will be
successful in the completion of the private placement. In the event the private
placement is not successful, or fails to raise sufficient funds, the Company may
seek alternative financing in the form of short-term or long-term debt or
securities convertible into common stock of the Company.

         In the event the private financing is successful, the Company intends
to engage Messrs. Misner and Webb as full-time employees and pay them monthly
salaries of approximately $5,000 per month, respectively. Even if the amount
raised in the private placement meets the Company's expectations, the Company
does not plan to hire additional employees or purchase or acquire plant or
significant equipment. The Company will meet its personnel, drilling and
pipeline requirements by contracting for these services with third parties.





<PAGE>   9

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

(a) Exhibits

Exhibit
Number    Title of  Exhibit
-------   -----------------

2.1       Agreement and Plan of Reorganization between Star Acquisitions
          Corporation and Southwestern Water Exploration Co., dated October 23,
          1993, incorporated by reference to Exhibit 2.1 of registrant's Annual
          Report on Form 10-KSB dated May 4, 1998.

3.1       Amended and Restated Articles of Incorporation, incorporated by
          reference to Exhibit 3.1 of registrant's Annual Report on Form 10-KSB
          dated May 4, 1998.

3.2       By-laws, incorporated by reference to Exhibit 3.2 of registrant's
          Annual Report on Form 10- KSB dated May 4, 1998.

10.1      License Agreement between American Institute of Formation Evaluation
          Ltd. and American Institute of Formation Evaluation Co., dated
          September 1, 1993, incorporated by reference to Exhibit 10.1 of
          registrant's Annual Report on Form 10-KSB dated May 4, 1998.

27.1      Financial Data Schedule.

(b) Reports on Form 8-K.

         The Company did not file any reports on Form 8-K during the second
quarter of the 2000 fiscal year.





<PAGE>   10

                                   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.

                                             Southwestern Water Exploration Co.

Date: December 27, 1999                      By: /s/ Steven B. Misner
                                                 ------------------------------
                                                     Steven B. Misner
                                                     President



         In accordance with the requirements of the Exchange Act, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.

<TABLE>
<CAPTION>

Signature                                   Title                                       Date
---------                                   -----                                       ----
<S>                                         <C>                                         <C>

/s/  Steven B. Misner                       President and Director                      December 27, 1999
---------------------
     Steven B. Misner


/s/  Barbara J. McAllister                  Chief Financial Officer (Principal          December 27, 1999
--------------------------                  Accounting Officer), Secretary
     Barbara J. McAllister                  and Director

</TABLE>