U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB

                             Quarterly Report Under
                       the Securities Exchange Act of 1934

                      For Quarter Ended: September 30, 2004

                         Commission File Number: 0-28031


                             PACIFIC FUEL CELL CORP.
                             -----------------------
        (Exact name of small business issuer as specified in its charter)


                                     Nevada
                                     ------
         (State or other jurisdiction of incorporation or organization)

                                   80-0043875
                                   ----------
                        (IRS Employer Identification No.)

                               131 N. Tustin Ave.
                                    Suite 100
                                   Tustin, CA
                                   ----------
                    (Address of principal place of business)

                                      92780
                                      -----
                                   (Zip Code)

                                 (714) 564-1693
                                 --------------
                           (Issuer's Telephone Number)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 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.
-----       -----

The number of shares of the  registrant's  only class of common stock issued and
outstanding as of November 15, 2004, was 66,438,354 shares.


<PAGE>

                                     PART I

ITEM 1.  FINANCIAL STATEMENTS.

     Our  unaudited  financial  statements  for  the  nine  month  period  ended
September 30, 2004, are attached hereto.

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

     The following  discussion  should be read in conjunction with our unaudited
financial  statements and notes thereto included herein. In connection with, and
because we desire to take  advantage  of, the "safe  harbor"  provisions  of the
Private  Securities  Litigation Reform Act of 1995, we caution readers regarding
certain forward looking statements in the following  discussion and elsewhere in
this report and in any other statement made by, or on our behalf, whether or not
in future filings with the Securities and Exchange  Commission.  Forward looking
statements are statements not based on historical  information  and which relate
to future  operations,  strategies,  financial  results  or other  developments.
Forward looking  statements are necessarily based upon estimates and assumptions
that are inherently  subject to significant  business,  economic and competitive
uncertainties and  contingencies,  many of which are beyond our control and many
of which,  with  respect to future  business  decisions,  are subject to change.
These  uncertainties and contingencies can affect actual results and could cause
actual results to differ  materially from those expressed in any forward looking
statements  made by, or on, our behalf.  We disclaim  any  obligation  to update
forward looking statements.

     In April, 2004, we, along with a then newly created wholly owned subsidiary
of our company,  PFCE Acquisition  Corp, a Nevada  corporation,  entered into an
Agreement and Plan of Merger with Cellfoods  Corporation,  a Nevada  corporation
("Cellfoods  "),  whereby  our  wholly  owned  subsidiary  merged  with and into
Cellfoods,  which  survived  this  transaction  and is  currently a wholly owned
subsidiary.  Effective  on or about May 14, 2003,  this merger was  consummated.
Cellfoods is a development stage corporation that was organized in January 2003,
and is engaged in the  business of  developing  a new,  better  tasting and more
nutritious  soybean  powder  for use in food  preparation.  This  product  has a
greater shelf life than current soybean powders. The principal product,  Soycell
Powder, is a uniquely  processed soybean powder whereby each cell of the soybean
is  separated by an exzymatic  process.  Because the powder  remains in cellular
formation, it does not smell or taste like conventional soybean powder or flour.
It has very  little  taste or  smell,  which  makes it  easier  to be used as an
additive or filler in recipes and food products. The product can be produced and
stored for up to 6 months or more without degradation,  compared to conventional
soybean powder, which is good for only 3 months before degradation occurs.

     As of the date of this Report, we are considering  "spinning off" Cellfoods
as a separate  public  company in the future and we expect to begin this process
in the near future.

                                       2
<PAGE>

     We did not  generate  any  revenues  during  the nine  month  period  ended
September  30, 2004.  During the nine month period ended  September 30, 2004, we
incurred costs and expenses totaling $178,354, including $34,463 in research and
development costs,  $50,958 in selling,  general and administrative  expense and
$80,000  of  non-cash  stock  compensation  expense,  as  compared  to costs and
expenses  of $75,004  during  the  comparable  period in 2003,  an  increase  of
$103,350.  This  increase  was  primarily  attributable  to $31,693 in increased
general and administrative  expense, which arose from professional fees incurred
pursuant to the Cellfoods  merger,  non-cash stock  compensation  of $80,000 and
financing costs of $10,371  incurred during the period,  offset by a decrease in
research and development expense of $21,276.

     As a result,  we  incurred a net loss of  $(183,779)  during the nine month
period ended  September 30, 2004 (less than $.01 per share).  Because we did not
generate any revenues  during the nine month  period ended  September  30, 2004,
following  is our Plan of  Operation,  rather  than a  comparison  of results of
operations.

Plan of Operation

     Our  initial  business  plan was to develop and produce low cost fuel cells
for  transportation.  During 2002, we revised our business plan to emphasize the
development  and  production of low cost fuel cells for personal  electronics or
other  applications  requiring  small size and  longevity of use. We revised our
original  business  plan as a result of the  costs  associated  with  developing
transportation  related fuel cells, which exceeded our available capital. We may
reinstate  the elements of the original  business  plan if our current  business
plan proves  successful,  of which there can be no assurance.  As of the date of
this  Report,  in order to bring  about  commercialization,  we are  focused  on
building a commercial prototype, enhancing product performance, reducing product
costs,  designing  market-  ready  products,   developing   volume-manufacturing
capability, and building customer and supplier relationships.

     On November 21, 2002, we entered into an agreement  with the  University of
California at Riverside to develop a  commercially  viable fuel cell  prototype.
The initial term of this agreement ran through  February 2003. In February 2003,
we entered into an amendment  which extended the term of this agreement  through
February 29, 2004. On May 4, 2004,  this agreement was extended  again,  through
April 30, 2005.  Pursuant to the terms of this  agreement,  as amended,  we have
agreed to reimburse the  University  for all costs and expenses  incurred,  both
direct and indirect,  in an amount not to exceed $181,271,  pursuant to a budget
agreed to by the parties.  The University,  through its SMART program,  provides
matching funds for all direct costs applicable to development of our project. We
tendered an initial payment of $70,000 upon execution of the initial  agreement,
and a second advance payment of $61,266 was tendered in March 2003,  pursuant to
our  exercise  of our  option  to  extend  this  agreement.  As a result  of the
amendment  extending  this  agreement  which was executed in April 2004,  we are
required to make additional payments totaling $150,486, including $50,005, which
was paid in May 2004,  $50,229,  which is due on or before May 1, 2005, with the
balance of  $50,252  due May 1, 2006.  All  information  which we provide to the
University  has been  deemed  confidential  for a period  of one (1) year  after
expiration or termination of the agreement.

                                       3
<PAGE>

     As  previously  reported,  we have applied for  additional  matching  funds
through the SMART program.  We recently obtained a favorable decision and expect
a grant of approximately $120,000 to be provided over the next three years. This
also  provides a multi-year  relationship  with the  University of California at
Riverside.

     As a result of the above  described  relationship  with the  University  of
California at Riverside, on November 10, 2003, we announced that a research team
headed by Professor  Yushan Yan of the University has  successfully  developed a
fuel cell using carbon  nanotube-based  electrodes.  As a result of our research
and  development  activities  with the  University,  we  expect  that the use of
multi-walled carbon nanotubes as a platinum support for proton exchange membrane
fuel cells will reduce the manufacturing  cost of fuel cells through a decreased
use of platinum.  Current  technology  uses platinum,  a precious  metal, as the
catalyst for hydrogen to separate into a proton and electron.  Since platinum is
a high cost metal in very limited production, it is cost prohibitive, preventing
fuel cells from being economically  viable even at high volume  production.  Our
proposed method of producing fuel cells is expected to minimize or eliminate the
use of platinum.  If successful,  the result will be low cost fuel cells at high
volume  production  levels.  We  believe  that  a fuel  cell  unit  can  replace
conventional  batteries  because a fuel cell unit should provide longer usage at
lower consumer cost.  While no assurances can be provided that this  development
will result in our  generating  revenues,  this  development  is  considered  by
management to be a significant  step forward in the use of fuel cell technology.
We expect to have additional  information  concerning this development available
in the near future.

     We intend to use our proprietary technology to severely reduce or eliminate
the  need  for  platinum  as a  catalyst.  We  believe  our  next  step  in  the
implementation  of our  business  plan  is to  develop  a  viable  manufacturing
prototype  which,  if it  meets  expectations,  will be ready  to be  placed  in
production.  In order to  accomplish  this  objective,  we have  opened  our own
laboratory to develop this additional  prototype.  We were able to open this new
lab as a result of receipt of funding more fully described under  "Liquidity and
Capital Resources," below.

     We have also entered into preliminary  discussions with potential strategic
partners to utilize our current technology  position in order to assume a market
leadership position in our target market of micro fuel cells. However, as of the
date of this  Report,  no  agreements  have been  entered  into and there are no
assurances  that  such  discussions  or any  such  agreement  will  occur in the
foreseeable future.

     We have also  investigated  the possibility of using our  proprietary  fuel
cell technology to provide  electricity for small commercial  establishments and
households.  Although  we do not  currently  have the rights to utilize our fuel
cell  technology  in this market,  we believe  that, if we decide to pursue this
market,  we can acquire  such  rights  from  Fullerene  on  advantageous  terms.
However,  there can be no assurances that we will be able to acquire such rights
in the future.

     Fuel  cell  acceptance   appears  to  be  accelerating.   Large  and  small
corporations,  as well as the United States government,  all appear convinced of
the value of fuel cell technology.  Despite all this activity, we have still not
seen a commercial  product that, in our opinion,  is  competitively  priced with
other forms of energy.  We believe that,  while fuel cell products will begin to
proliferate,  market  acceptance  will come only when prices fall to competitive
levels.

                                       4
<PAGE>


     There are currently  several  different  technologies  in use for fuel cell
power generation. Each of these processes differs in methodology, suitable scale
and efficiency. Our interest (and patent applications) is in the Proton Exchange
Membrane (PEM) method which is very suitable for low temperature operation.

Liquidity and Capital Resources

     At September  30, 2004,  we had $684,017 in cash. We had $2,862 in accounts
payable, plus $1,675 in accrued interest payable.

     In May 2004, we assumed a financing  arrangement  with HEM Mutual Assurance
LLC,  Minneapolis,  Minnesota,  an accredited  investor (as that term is defined
under Rule 501,  Regulation D, promulgated  under the Securities Act of 1933, as
amended) to issue up to $1,000,000 in aggregate  principal amount of convertible
debentures  pursuant to Rule 504 of  Regulation  D under the  Securities  Act of
1933, as amended.  These  Debentures were originally  issued by Cellfoods in two
separate   convertible   debentures   of  $997,000   and  $3,000,   respectively
(hereinafter  referred to in the aggregate as the "Debentures").  As of the date
of this Report, an aggregate of approximately $793,728 has been converted by the
Debenture  Holder into 2,957,254  shares of our common stock. See "Part II, Item
2, Changes in Securities," below.

     We believe our next step in the  implementation  of our business plan is to
develop a viable manufacturing  prototype which, if it meets expectations,  will
be ready to be placed in  production.  We hope to accomplish  this  objective by
opening our own laboratory to develop this  additional  prototype,  which is now
open as a result of the financing described above.

     We also had  outstanding  loans in the  principal  amount  of  $60,000  and
$10,000, due to Fullerene, USA, Inc., our majority stockholder. In regard to the
$60,000 loan, we originally received an unsecured, non-interest bearing loan for
$60,000 which was due  September  14, 2002.  On December 5, 2002,  this note was
cancelled  with the consent of Fullerene and replaced with a note  extending the
due date to August 14, 2004. Both of these notes have been paid in full.

     We believe that we currently  have  sufficient  funds  available  for us to
continue to implement  our  business  plan for the next 12 months.  However,  we
estimate that we will require an additional  $2.5 million in additional  debt or
equity capital to fully  implement our business plan in the future and there are
no assurances  that we will be able to raise this capital when needed.  However,
while there are no definitive agreements in place as of the date of this Report,
we are  currently  engaged in various  discussions  with  interested  parties to
provide these funds or otherwise enter into a strategic alliance to provide such
funding.  The inability to obtain  sufficient  funds from external  sources when
needed  will have a material  adverse  affect on our results of  operations  and
financial condition.

     In July 2004,  we received  notice that we had been  selected by the United
States  Department  of  Energy  for a Phase I STTR  (Small  Business  Technology
Transfer)  grant. The initial grant in the amount of $100,000 is being processed
for payment as of the date of this

                                       5
<PAGE>

report and we expect to  receive  these  funds by the end of 2004.  We intend to
apply  for  additional  grant  money  from the US  government,  as well as other
potential sources, in the future.  There are no assurances that our applications
will be approved.

TRENDS

     Since our  announcement of the successful  development of a carbon nanotube
support base fuel cell  electrode  in November  2003,  we have been  receiving a
significant amount of attention from the investment  community.  In this regard,
while  there are no  assurances,  we are  hopeful  that we will be able to raise
approximately $2.5 million in additional funding in order to allow us to produce
and demonstrate to fuel cell manufacturers a commercially viable prototype.  See
"Liquidity and Capital Resources," above.

     Our new  laboratory  is  also  expected  to  function  as a hub to  attract
additional researchers from the University of California at Riverside,  which is
on the path to become a leader in the  nano-technology  field.  We believe  that
there are many potential  useful  applications of  nano-technology  which can be
expected in the immediate future,  including fuel cells and flat panel displays.
Also at this laboratory,  functional  prototypes will be made before bringing in
manufacturers. Our plan is to have the manufacturers inspect the prototype, once
completed,  in order to generate their own test production  unit. If successful,
manufacturing  can  commence  producing  products  in  quantity  in less than 12
months. We foresee the initial  application to be a battery replacement for cell
phones,  mobile notebook  computers/laptops  and other applicable  applications.
This segment is known as the micro fuel cell  market.  We expect that these fuel
cells will eventually be produced like modular computer chips and components.

     We  believe  that the  reason  that the fuel  cell  market  is not  rapidly
expanding  at this time is due to high  manufacturing  costs.  We believe that a
robust fuel cell market is  inevitable,  due to the  advantages of low pollution
and  independence  from fossil fuels.  Major  automobile,  industrial  and power
supply companies are heavily involved in research and development  activities of
fuel cell technology and many have announced  prototypes and commercial  models.
However, there has not been a major commercial breakthrough,  which we attribute
to the high cost of the  products and the lack of consumer  proven  reliability.
While no assurances can be provided, once the problem of high costs is resolved,
we expect the micro fuel cell market to increase significantly.

Inflation

     Although our operations are influenced by general economic  conditions,  we
do not believe that inflation had a material affect on our results of operations
during the nine month period ended September 30, 2004.

ITEM 3.   CONTROLS AND PROCEDURES

     Within 90 days prior to the date of filing of this quarterly report on Form
10-QSB,   we  carried  out  an  evaluation,   under  supervision  and  with  the
participation of our management, including our CEO and CFO, of the effectiveness
of the design and operation of our disclosure

                                       6
<PAGE>

controls and  procedures  pursuant to Exchange Act Rule 13a-14.  Based upon that
evaluation,  our  CEO  and  CFO  concluded  that  our  disclosure  controls  and
procedures  are  effective  in  timely  alerting  them to  material  information
relating to us required to be included in our periodic  SEC filings.  Subsequent
to the date of that evaluation,  there have been no changes in internal controls
or in other factors that could significantly affect internal controls,  nor were
any  corrective  actions  required with regard to significant  deficiencies  and
material weaknesses.

                           PART II. OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS - None

ITEM 2.   CHANGES IN SECURITIES

     In May 2004,  we issued  30,000,000  shares of our common stock into escrow
pursuant to the terms and  conditions  contained  in the  definitive  agreements
relating to the  convertible  debenture more fully described in "Part I, Item 2,
Liquidity and Capital  Resources," above. As of September 30, 2004, we issued an
aggregate of 2,655,824 of these escrowed shares for aggregate  consideration  of
approximately $700,032, including accrued interest of $1,104 (approximately $.27
per share).  In the event we either repay the outstanding  Debenture or no other
shares are issued  pursuant to conversion of the same, the balance of the shares
will be returned to our treasury.

     In addition, in August 2004, we entered into a consulting agreement with an
individual  to assist us in the  development  and  implementation  of strategies
relating to our fuel cell  prototype,  as well as merger,  acquisition  or joint
venture opportunities.  In consideration  therefore, we issued this individual a
three (3) year option to purchase up to 250,000 shares of our common stock at an
exercise price of $.035 per share, the market price of our common stock when the
agreement was reached.  If certain goals are met, this  individual  will also be
entitled to receive options to purchase up to an additional  2,250,000 shares of
our common stock at a price to be determined in the future,  based upon our then
current market price of our common stock. The aforesaid  options to purchase the
2,250,000 shares have not yet vested as of the date of this Report.

Subsequent Event

     In October  2004,  we issued an  aggregate  of 80,000  shares of our common
stock to our attorney,  as part of the consideration we agreed to tender related
to the preparation of a registration statement pursuant to the Securities Act of
1933,  as amended,  for  purposes of  accomplishing  a  "spin-off"  of Cellfoods
Corporation.  Of these shares, 40,000 were immediately issued and we are holding
the  remaining  40,000  pending  issuance  of an order of  effectiveness  on the
registration  statement  from  the  SEC.  As of the  date  of this  report,  the
registration  statement  has  not  been  filed,  but we are  in the  process  of
preparing the same.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES - None

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - None

                                       7
<PAGE>


ITEM 5.   OTHER INFORMATION - None

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

(a) Exhibits

31.      Certification of Financial Statements in accordance with Section 302 of
         the Sarbanes-Oxley Act of 2002

32.      Certification of Financial Statements in accordance with Section 906 of
         the Sarbanes-Oxley Act of 2002

(b) Reports on Form 8-K.

     In July  2004,  we filed an  amendment  to our Form  8-K,  which  amendment
included the audited financial  statements and pro forma financial statements of
Cellfoods  Corp.  We did not file any other reports on Form 8-K during the three
month period ended September 30, 2004.

                                       8

<PAGE>


                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                           CONSOLIDATED BALANCE SHEET
                               SEPTEMBER 30, 2004
                                   (UNAUDITED)


                                     ASSETS

CURRENT ASSETS
   Cash                                                             $   684,017
   Accounts receivable                                                   36,297
   Prepaid expense                                                       35,112
   Inventory                                                              6,160
   Deferred debenture costs - current                                    27,380
                                                                    -----------
          Total current assets                                          788,966
                                                                    -----------
OTHER ASSETS
   Deferred debenture costs                                              99,149
   Equipment deposit                                                     23,000
   Security deposit                                                       3,059
                                                                    -----------
                                                                        125,208
                                                                    -----------
                                                                    $   914,174
                                                                    ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                                                  $     2,862
  Accrued interest payable                                                1,675
                                                                    -----------
          Total current liabilities                                       4,537
                                                                    -----------

CONVERTIBLE REDEEMABLE DEBENTURES PAYABLE                               301,072
                                                                    -----------
STOCKHOLDERS' EQUITY
  Preferred stock, $0.01 par value, 1,000,000 shares
     authorized, none outstanding                                            --
  Common stock, $0.001 par value, 200,000,000 shares
     authorized, 66,101,924 shares issued and outstanding                66,102
  Additional paid in capital                                          2,095,079
  (Deficit) accumulated during the development stage                 (1,552,616)
                                                                    -----------
                                                                        608,565
                                                                    -----------
                                                                    $   914,174
                                                                    ===========

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

                                       9

<PAGE>

<TABLE>
                            PACIFIC FUEL CELL CORP.
                         (A DEVELOPMENT STAGE COMPANY)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                                                                                                              For the Period
                                                                                                               May 5, 1998
                                                    Three months ended              Nine months ended         (inception) to
                                                       September 30,                   September 30,           September 30,
                                                   2004            2003             2004           2003            2004
                                               ------------    ------------    ------------    ------------    ------------
<S>                                            <C>             <C>             <C>             <C>             <C>
REVENUE                                        $         --    $         --    $         --    $         --    $      6,172
                                               ------------    ------------    ------------    ------------    ------------
COSTS AND EXPENSES
  Research and development                           17,001          15,317          34,463          55,739         155,518
  Purchased research and development                     --              --           2,562              --           2,562
  Selling, general and administrative                19,384           3,257          50,958          19,265         554,765
  Stock compensation                                 80,000              --          80,000              --         320,000
  Amortization                                           --              --              --              --          11,645
  Financing cost                                      6,845              --          10,371              --          10,371
  Loss on asset impairment                               --              --              --              --         510,667
  Loss on disposal of property and equipment             --              --              --              --           3,391
                                               ------------    ------------    ------------    ------------    ------------
       Total operating expenses                     123,230          18,574         178,354          75,004       1,568,919
                                               ------------    ------------    ------------    ------------    ------------
OPERATING (LOSS)                                   (123,230)        (18,574)       (178,354)        (75,004)     (1,562,747)
                                               ------------    ------------    ------------    ------------    ------------
OTHER INCOME (EXPENSE)
  Interest expense                                   (1,742)           (968)         (6,837)         (2,854)        (25,437)
  Interest income                                       875               2           1,412               9           1,422
  Foreign currency transaction (loss)                    --              --              --              --            (168)
  Gain on forgiveness of debt                            --              --              --              --          35,500
  Other expense                                          --              --              --              --          (1,186)
                                               ------------    ------------    ------------    ------------    ------------
                                                       (867)           (966)         (5,425)         (2,845)         10,131
                                               ------------    ------------    ------------    ------------    ------------
NET (LOSS)                                     $   (124,097)   $    (19,540)   $   (183,779)   $    (77,849)   $ (1,552,616)
                                               ============    ============    ============    ============    ============
PER SHARE INFORMATION

WEIGHTED AVERAGE SHARES OUTSTANDING -
  BASIC AND DILUTED                              65,432,000      63,440,000      64,316,000      63,440,000      41,120,000
                                               ============    ============    ============    ============    ============
NET (LOSS) PER COMMON SHARE                    $      (0.00)   $      (0.00)   $      (0.00)   $      (0.00)   $      (0.04)
                                               ============    ============    ============    ============    ============
</TABLE>

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

                                       10

<PAGE>

<TABLE>
                            PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
<CAPTION>
                                                                                                 For the Period
                                                                                                  May 5, 1998
                                                                                                (inception) to
                                                                 Nine months ended September 30, September 30,
                                                                       2004          2003            2004
                                                                    ----------    -----------    -----------
<S>                                                                 <C>           <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net cash (used in) operating activities                           $ (125,069)   $   (85,491)   $  (644,406)
                                                                    ----------    -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES
   Equipment deposit                                                   (23,000)            --        (27,891)
   Investment in mineral claims                                             --             --         (5,000)
   Cash acquired with Cellfoods acuisition                              16,898             --         16,898
                                                                    ----------    -----------    -----------
Net cash (used in) investing activities                                 (6,102)            --        (15,993)
                                                                    ----------    -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from loans payable - shareholders                            10,000             --        295,462
  Payments on loans payable - shareholders                             (70,000)            --        (81,083)
  Proceeds of debenture issue                                        1,000,000             --      1,000,000
  Deferred debenture costs                                            (136,900)            --       (136,900)
  Proceeds from stock issuances                                             --             --        266,937
                                                                    ----------    -----------    -----------
Net cash provided by financing activities                              803,100             --      1,344,416
                                                                    ----------    -----------    -----------
              Net increase (decrease) in cash                          671,929        (85,491)       684,017

CASH AT BEGINNING OF PERIOD                                             12,088        100,822             --
                                                                    ----------    -----------    -----------
CASH AT END OF PERIOD                                               $  684,017    $    15,331    $   684,017
                                                                    ==========    ===========    ===========
NON-CASH FINANCING ACTIVITIES
   Conversion of debentures and accrued interest to common stock    $  700,032    $        --    $   700,032
                                                                    ==========    ===========    ===========
   Issuance of stock in Cellfoods acquisition                       $    2,562    $        --    $     2,562
                                                                    ==========    ===========    ===========
SUPPLEMENTAL CASH FLOW INFORMATION
   Cash paid for interest                                           $       --    $        --    $        --
                                                                    ==========    ===========    ===========
   Cash paid for income taxes                                       $       --    $        --    $        --
                                                                    ==========    ===========    ===========

</TABLE>

                                       11

<PAGE>

                            PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2004
                                   (UNAUDITED)

Note 1.  Basis of Presentation

The accompanying  unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America for  interim  financial  information.  They do not include all of the
information and footnotes required by accounting  principles  generally accepted
in the United  States of  America  for  complete  financial  statements.  In the
opinion of management,  all  adjustments,  consisting  only of normal  recurring
adjustments, considered necessary for a fair presentation, have been included in
the  accompanying  unaudited  financial  statements.  Operating  results for the
periods  presented  are not  necessarily  indicative  of the results that may be
expected  for the full year.  For further  information,  refer to the  financial
statements and notes therto, included in the Company's Form 10-KSB as of and for
the year ended December 31, 2003.


Note 2.  Going Concern

The  accompanying  financial  statements  have been prepared in conformity  with
accounting principles generally accepted in the United States of America,  which
contemplates  continuation  of the Company as a going  concern.  The Company has
incurred losses since inception of $1,552,616, and is reliant on raising capital
to initiate its business plan,  and has no revenue  generating  operations.  The
Company is exploring  options to expand  operations and raise  additional  funds
through equity and debt financing,  however,  the Company has no commitment from
any party to provide  additional  capital  and there is no  assurance  that such
funding will be available when needed,  or if available,  that its terms will be
favorable or acceptable to the Company.

The financial  statements do not include any adjustments to reflect the possible
future effects on the recoverability and classification of assets or the amounts
and classification of liabilities that may result from the possible inability of
the Company to continue as a going concern.


Note 3.  Earnings Per Share

The Company  calculates  net income (loss) per share as required by Statement of
Financial  Accounting  Standard 128, "Earnings per Share." Basic earnings (loss)
per share is calculated  by dividing net income  (loss) by the weighted  average
number of common shares outstanding for the period.  Diluted earnings (loss) per
share is calculated by dividing net income (loss) by the weighted average number
of common shares and dilutive common stock equivalents  outstanding.

                                       12
<PAGE>

During the periods presented,  common stock equivalents were not considered,  as
their effect would be anti-dilutive.


Note 4.  Research and Development

On August  21,  2002 the  Company  entered  into a one-year  agreement  with the
University of California  (the  "University")  to develop a commercially  viable
fuel cell. Under this agreement,  the Company advanced the University  $131,266.
The  Company  and  the  University  entered  into an  agreement  to  extend  the
completion  date to February 29, 2004. On May 4, 2004, the agreement was further
extended  through April 30, 2007.  Pursuant to this  extension,  the Company had
made an initial  payment  of $50,005  and will be  required  to make  additional
payments in the aggregate amount of $100,481.  A payment of $50,229 is due on or
before May 1, 2005 and the  balance  of $50,252 is due on May 1, 2006.  Research
and  development  costs for the three months and nine months ended September 30,
2004 of  $17,001  and  $34,463,  respectively,  were  charged to  expenses  when
incurred.


Note 5.  Merger Agreement

Effective May 14, 2004, the Company,  Cellfoods Corporation  ("Cellfoods") and a
wholly-owned   subsidiary  of  the  Company,   PFCE  Acquisition  Corp.  ("Sub")
consummated  an  Agreement  and Plan of Merger,  whereby Sub was merged with and
into Cellfoods.  All of the Cellfoods' issued and outstanding common shares were
exchanged for 6,100 shares of the Company's  $.001 par value common stock,  at a
conversion ratio of .01 to 1, as a tax-free  reorganization  pursuant to Section
365(a) of the Internal Revenue Code. The shares were issued at their fair market
value of $2,562,  which has been charged to operations as purchased research and
development  during the period.  Cellfoods had no operations for the period from
May 14, 2004 through September 30, 2004.

Note 6.  Convertible Debentures

In May 2004, Cellfoods completed a private placement with an accredited investor
(as defined under Rule 501,  Regulation D, promulgated  under the Securities Act
of 1933, as amended) to issue up to $1,000,000 in the aggregate principal amount
of  convertible  debentures,  pursuant  to Rule 504 of  Regulation  D under  the
Securities Act of 1933, as amended.  The debentures were initially issued as two
separate  debentures  in the amount of $997,000 and $3,000,  respectively,  bear
interest at 1% per annum and mature in five years.  Pursuant to the terms of the
merger  discussed  above (Note 5), the Company has assumed the  obligations  and
benefits of Cellfoods,  including the obligation under the Debenture  agreement.
The  Company  received  net  proceeds  of  $863,100  after  payment of  deferred
debenture  costs of $136,900.  The deferred  debenture costs are being amortized
over the five  year  term of the  debentures.  As of  September  30,  2004,  the
remaining principal under the debentures,  after giving effect to the conversion
of $698,928  plus  accrued  interest of $1,104  (Note 7), is  $301,072.  Accrued
interest thereon is $1,675 at September 30, 2004.

                                       13
<PAGE>

Note 7.  Stock Issuance

In May 2004, the Company caused  30,000,000  shares of its  unrestricted  common
stock to be issued in connection  with the issuance of the debentures  discussed
above in Note 5. The  shares  are held in  escrow  and will be  returned  to the
Company's treasury to the extent the debentures are not converted.

During the nine months ended September 30, 2004, a total of 2,655,824  shares of
the  Company's  common  stock were issued  upon  conversion  of the  convertible
redeemable  debentures  discussed  above, in the amount of $698,928 plus accrued
interest of $1,104 (approximately $.26 per share).

In  conjunction  with the options issued  pursuant to the  consulting  agreement
described in Note 8, the Company charged $80,000 to operations during the period
ended September 30, 2004, related to the fair market value of the options.

SFAS 123  requires the Company to provide  proforma  information  regarding  net
income and earnings per share as if  compensation  cost for the Company's  stock
option plans had been  determined in accordance with the fair value based method
prescribed  in SFAS 123. The fair value of the option grants is estimated on the
date of  grant  utilizing  the  Black-Scholes  option  pricing  model  with  the
following  weighted  average  assumptions  for grants  during  the period  ended
September 30, 2004: expected life of options of 3 years;  expected volatility of
183%;  risk-free interest rate of 3% and no dividend yield. The weighted average
fair value at the date of grant for  options  granted  during  the period  ended
September  30,  2004  approximated  $.32 per  option.  These  results may not be
representative of those to be expected in future years.

Under the  provisions of SFAS 123, the Company's net (loss) and (loss) per share
would not be materially affected.


Note 8.  Consulting Agreement

Effective  August 1, 2004, The Company entered into a consulting  agreement with
an individual for services to be rendered in connection with the development and
implementation  of strategies  regarding the Company's fuel cell  prototype,  as
well as merger,  joint venture or acquisition  opportunities.  As consideration,
the Company has agreed to pay the consultant  $1,500 per month for 36 months and
issued the  individual  a three year option to purchase up to 250,000  shares of
the Company's  common stock,  at an exercise  price of $.35 per share,  the fair
market value of the stock on the date the agreement was consummated. The initial
options vested fully upon execution of the  agreement.  In addition,  if certain
performance goals are met, the individual will be entitled to receive options to
purchase up to an additional  2,250,000 shares of the Company's common stock, at
prices to be  determined  in the future,  based on the then fair market value of
the stock.

                                       14
<PAGE>

Note 9.  Operating Lease

In August 2004, the Company  entered into a three year operating lease agreement
with an unrelated entity, for laboratory space effective  September 1, 2004. The
lease calls for thirty six monthly payments of $3,059, continuing through August
31, 2007. The Company paid a security deposit of $3,059 related to this lease.

Note 10.  Grant

In July 2004,  the Company was selected by the U.S.  Department  of Energy for a
Phase  I STTR  (Small  Business  Technology  Transfer)  grant,  and  anticipates
receiving an initial grant of $100,000, beginning in late 2004.

Note 11.  Subsequent Events

Issuance of common stock

In October 2004, the Company issued 80,000 shares of its common stock to a third
party as part of a retainer for future legal fees.

In  November  2004,  the  debenture  holder  elected to  convert  $94,800 of the
outstanding  debenture  plus interest of $452 to 301,430 shares of the Company's
common stock (approximately $0.32 per share).


                                       15

<PAGE>

                                   SIGNATURES

     Pursuant to the  requirements  of Section 12 of the Securities and Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

Dated: November 15, 2004

                                         PACIFIC FUEL CELL CORP.
                                         (Registrant)



                                         By: s/ Ken Inouye
                                            ------------------------------------
                                            Ken Inouye, Secretary & Treasurer

                                       16