UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)
[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

For the quarterly period ended September, 30 2002

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

For the transition period from ___________________ to __________________________

Commission file number 0-20430
                                AZCO MINING INC.
               --------------------------------------------------
             (Exact name of registrant as specified in its charter)
Delaware                                                 84-1094315
---------                                                -----------
(State or other jurisdiction of incorporation        (I.R.S. Employer
or organization)                                    Identification No.)

                             7239 N. El Mirage Road
                             Glendale, Arizona 85307
                    (Address of principal executive offices)
                                   (Zip Code)

                                  (623)935-0774
              (Registrant's telephone number, including area code)

(Former name,former address and former fiscal year,if changed since last report)

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 ____
    ------

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the latest practicable date.

     The  Company  had  32,159,646  shares of  Common  Stock  outstanding  as of
November 12, 2002. AZCO MINING INC.

<PAGE>

                          PART I. FINANCIAL INFORMATION


Item 1. Financial Statements

<TABLE>
<CAPTION>
                                                              Page
<S>                                                           <C>
Consolidated Balance Sheets                                   3

Consolidated Statements of Operations                         4

Consolidated Statements of Cash Flows                         5

Consolidated Statement of Stockholders' Equity                6

Notes to Interim Consolidated Financial Statements            7-14

</TABLE>

<PAGE>

AZCO MINING INC.
CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                           September         June 30,
                         ASSETS                               2002             2002
                                                          (Unaudited)        (Audited)
<S>                                                       <C>                <C>
Current assets:
  Cash and cash equivalents                               $   34,284         $  884,647
  Prepaids and other                                         279,235            179,225
  Inventories (Note 3)                                     1,086,309          1,095,780
          Total current assets                             1,399,828          2,159,652
                                                          -----------         ----------
Capital assets:
  Mineral properties, plant & equipment, net (Note 2)      10,178,413         10,352,872
  Capital assets                                              263,354            288,148
                                                           10,441,767         10,641,020

Restricted cash                                               190,400            190,400
                                                           -----------        -----------
          Total assets                                    $12,031,995       $ 12,991,072
                                                        ================  ===============

          LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable and accrued liabilities                $   574,722       $    540,768
  Notes payable (Note 4)                                      391,877            443,672
  Accrued settlement obligation                               240,000            586,000
                                                            1,206,599          1,570,440
Long term liabilities:
  Accrued settlement obligation                               360,000            444,900
  Financing lease liability (Note 4)                        2,018,534          1,975,650
  Notes payable to related party (Note 4)                     656,315            615,068
  Other liabilities                                           114,122            275,127
                                                            3,148,971          3,310,745
                                                        ----------------  ---------------
          Total liabilities                                 4,355,570          4,881,185
                                                        ----------------  ---------------

Contingencies and commitments (Note 5)

Stockholders' equity
Common stock: $.002 par value, 100,000,000 shares
authorized; 32,159,646 shares outstanding as of               64,319              62,304
September 30, 2002 and 31,151,121 shares
outstanding as of June 30, 2002
Additional paid-in capital                                31,972,106          30,951,523
Deficit                                                  (24,360,000)        (22,903,940)
                                                        ----------------  ---------------
                                                           7,676,425           8,109,887
                                                        ----------------  ---------------
        Total liabilities and stockholders' equity       $12,031,995         $12,991,072
                                                        ================  ===============

</TABLE>

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

<PAGE>

AZCO MINING INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited)

<TABLE>
<CAPTION>
                                                 Three Months Ended
                                                   September 30,
                                          --------------------------------
                                               2002             2001
<S>                                       <C>                   <C>
Sales                                      20,462                     -
Operating costs and expenses
Production costs                          537,034               244,917
General and administrative                567,314               141,389
Salaries                                   87,186                83,622
Exploration                                15,227                47,866
Amortization & depreciation                50,070                32,730
Financing                                  28,000                     0
Accretion of asset retirement obligation
(Note 7)                                    1,250                     0
                                          ---------------  ---------------

Total operating costs and expenses        1,286,081             550,524

Operating loss                            $(1,265,619)          $(550,524)

Other income/expense:
Interest expense                           (163,336)            (21,430)
Interest income                               2,995                 803
                                          ---------------  ---------------
                                           (160,341)            (20,627)
                                          ---------------  ---------------

Loss before cumulative effect of accounting (1,425,960)         (571,151)
change

Cumulative effect of accounting change, net  13,902                (0.02)
of taxes of $0 (Note 7)
                                          ---------------  ---------------
Net loss                                  $(1,439,862)          $(571,151)
                                          ===============  ===============
Basic loss per share before cumulative       (0.04)                (0.02)
effect of accounting change
Cumulative effect of accounting change            0                    0
                                          ---------------  ---------------
Diluted loss per share before cumulative
effect of accounting change                  (0.04)                (0.02)
Cumulative effect of accounting change            0                    0
                                          ---------------  ---------------
Diluted loss per common share             $  (0.04)             $  (0.02)
                                          ===============  ===============
Weighted average common shares            31,870,011            30,050,621
                                          ===============  ===============

</TABLE>

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

<PAGE>

AZCO MINING INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS (Unaudited)

<TABLE>
<CAPTION>
                                                       Three Months Ended
                                                          September 30,
                                                       2002           2001
<S>                                                    <C>            <C>
Cash flows from operating activities:
     Net loss                                          $(1,439,862)   $(571,151)
     Adjustments to reconcile net loss to net cash
     used in operations:
           Depreciation and amortization                    50,070       32,730
           Accretion of asset retirement obligation          1,250
           Stock option compensation and other
                 non-cash expenses                         363,000
           Amortization of debt discount                   132,336       52,474
           Cumulative effect of accounting change           13,902
     Changes in assets and liabilities, net:
           Prepaid and other                              (109,820)      61,965
           Inventories                                       9,471       (4,870)
           Accounts payable and accrued liabilities        350,954     (131,763)
           Accrued settlement obligation                  (124,900)
Net cash used in operating activities                     (753,599)    (560,615)
                                                       ------------- --------------
Cash flows from financing activities:
      Proceeds from loan                                         0      400,000
      Payments on notes payable                           (100,000)           0
      Proceeds from sale of stock                                0      150,000
      Payments on capital lease obligations                (17,164)           0
      Proceeds from exercise of options                     20,400            0
                                                       ------------- --------------
Net cash (used in) provided by financing
activities:                                                (96,764)     550,000
                                                       ------------- --------------
Net decrease in cash and cash equivalents                 (850,363)     (10,615)
Cash and cash equivalents at beginning of period           884,647       39,920
                                                       ------------- --------------
Cash and cash equivalents at end of period                $ 34,284      $29,305
                                                       ============= ==============

</TABLE>

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

<PAGE>

AZCO MINING INC.
CONSOLIDATED
STATEMENT OF
STOCKHOLDERS' EQUITY
(Unaudited)

<TABLE>
<CAPTION>
                                    Common
                                     Stock                Additional
                                                          paid-in
                             Shares         Amount        capital        Deficit           Total
<S>                          <C>            <C>           <C>            <C>               <C>
Balance June 30, 2002        31,152,121     62,304        30,951,523     (22,903,940)      8,109,887
Increase in warrant value
(Note 4)                                                      16,198         (16,198)              0
Common shares issued
 (Note 6)                       977,525      1,955           984,045                         986,000
Exercise of options              30,000         60            20,340                          20,400
Net loss                                                                  (1,439,862)      (1,439,862)
                             -----------    -------       -----------    ------------      -----------
Balance September 30,
2002                         32,159,646     64,319        31,972,106     (24,360,000)       7,676,425
                             ===========    =======       ===========    ============      ===========

</TABLE>

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

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1. Basis of Presentation and Going Concern

The  unaudited  consolidated  financial  information  presented  herein has been
prepared in accordance  with the  instructions to Form 10-Q and does not include
all of the  information  and note  disclosures  required by  generally  accepted
accounting principles. Therefore, this information should be read in conjunction
with the  consolidated  financial  statements and notes thereto  included in the
Azco Mining Inc.  ("Azco" or "the  Company")  Annual Report on Form 10-K for the
fiscal year ended June 30, 2002. This interim financial information reflects all
adjustments  that  are,  in  the  opinion  of  management,  necessary  to a fair
statement of the results for the interim period.

The  consolidated  balance  sheet as of June 30, 2002  included  herein has been
derived from the audited  consolidated  balance sheet  included in the Company's
annual  report  on Form  10-K for the year  ended  June 30,  2002,  but does not
include  all  the  disclosures   required  by  generally   accepted   accounting
principals.

Azco Mining Inc.  is a mining  company  incorporated  in  Delaware.  Its general
business  strategy is to acquire,  explore and develop mineral  properties.  The
Company's  principal  assets are the 100% owned  Black  Canyon  Mica  Project in
Arizona and an interest in the Piedras Verdes Project in Sonora, Mexico.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will  continue to operate as a going  concern.  The Company has
suffered   recurring  losses  from  operations  and  the  Company  will  require
additional  funds to  continue  operations.  On  November  4,  2002 the  Company
temporarily   ceased   production   at  its  Black  Canyon  Mine   crushing  and
concentrating  facilities due to cash  constraints.  Production will start again
once adequate financing has been raised. On November 12, 2002 the Company's Form
S-1 Registration Statement, filed with the Securities and Exchange Commission in
regard to the  Equity  Line of  Credit,  became  effective.  The  Company is now
eligible to, at our discretion,  periodically  issue and sell to Cornell Capital
Partners  shares of common stock for a total  purchase price of $5 million for a
period of up to two years  after  November  12,  2002,  whichever  comes  first.
Management  is  actively  seeking  additional  financing;  however,  there is no
assurance  that these efforts will be  successful or on terms  acceptable to the
Company.  These matters raise doubt about the Company's ability to continue as a
going  concern.  These  consolidated  financial  statements  do not  include the
adjustments  that would be necessary,  including a provision  for  impairment of
plant and  equipment  which could be  material,  should the Company be unable to
continue as a going concern.

The  Company  will need a minimum  of $2 million of  additional  funding  during
fiscal  2003 to cover  operating  requirements.  The  Company is also  seeking a
minimum of $1.5 million of funding for capital  improvements to its Black Canyon
process facilities.

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

Note 2. Black Canyon Mica Project (Arizona)

During the quarter ended September 30, 2002, the sales of feldspathic  sand into
the golf  course  and  stucco  markets  began on a limited  basis;  in  addition
production testing of  mica-reinforced  plastics for three potential vendors was
initiated. Funding will be necessary to advance the project further.

Detail of mica project mineral properties, plant and equipment is as follows:

<TABLE>
<CAPTION>
                                                        September 30,   June 30,
                                                        2002            2002
                                                        ------------    ------------
<S>                                                     <C>             <C>
Acquisition of mineral properties                       2,219,996       2,219,996
Mining and processing plant and equipment               7,122,679       7,122,679
Development costs                                         943,704       1,104,966
Accumulated amortization                                 (107,966)        (94,769)
                                                         ---------       --------
Total                                                   10,178,413      10,352,872
                                                        ----------      ----------
Detail of other capital assets is as follows:

                                                        September 30,   June 30,
                                                        2002            2002
                                                        ----            ----
Office building                                            152,997        152,997
Furniture and equipment                                    381,383        381,383
Vehicles                                                    81,146         81,146
Accumulated depreciation                                  (352,172)      (327,378)
                                                        -----------     ----------
Total                                                      263,354        288,148

Note 3. Inventories

                                                        September 30,   June 30,
                                                        2002            2002
                                                        ----            ----
Broken ore                                                645,569         725,202
Mica work-in-process                                      331,640         277,378
Mica finished goods                                        93,200          93,200
Sand finished goods                                        15,900               0
                                                        ---------       ---------
Total                                                   1,086,309       1,095,780
                                                        -------------------------

</TABLE>

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

Note 4. Notes payable, warrants and other financing

On October 12, 2001, the Company  restructured  its $800,000 loan agreement with
Mr. Olson the Company's Chairman, CEO and President.  Mr. Olson agreed to extend
the note  payable an  additional  year to March 15,  2003 in  consideration  for
700,000  warrants to purchase the Company's stock at an exercise price of $0.40.
The warrants  vested in December  2001 and shall expire on October 12, 2003.  In
addition,  effective  October 1, 2001, the interest rate payable on the $800,000
Olson loan was adjusted  from prime plus 1% to 12% annually.  In June 2002,  the
loan was extended an additional year and Azco entered into a security  agreement
with Mr. Olson,  whereby  Azco's assets  secured the loan. The loan is currently
due on March 14, 2004.

On September 4, 2001, the Company  received a one-year  $100,000  loan,  bearing
interest at 12% per annum, from Mr.  Barrenachea,  a shareholder.  In connection
with this loan, the Company  issued a warrant to purchase  125,000 shares of the
Company's  common stock at $.40 per share. On September 4, 2002 the loan and the
warrants were extended an additional  year under the same terms.  The warrant is
exercisable through September 4, 2004. The increase of $16,198 in the fair value
of  the  warrant  has  been   reflected  as  a  current   period   accretion  to
paid-in-capital.

On October 19, 2001, the Company received an additional  one-year $100,000 loan,
bearing interest at 12% per annum, from Mr. Barrenachea. In connection with this
loan, the Company  issued a warrant to purchase  125,000 shares of the Company's
common  stock at $.40 per share.  On October 19, 2002 the loan and the  warrants
were  extended  an  additional  year  under  the  same  terms.  The  warrant  is
exercisable through October 19, 2003

On December 3, 2001, the Company received an additional  one-year $100,000 loan,
bearing interest at 12% per annum, from Mr. Barrenachea. In connection with this
loan, the Company  issued a warrant to purchase  125,000 shares of the Company's
common  stock at $.40 per share.  The  warrant  vested in  February  2002 and is
currently excercisable through December 3, 2002. Mr. Barrenachea and the Company
have  agreed to extend the loan and the  warrants an  additional  year under the
same terms through December 3, 2003.

In January 2002, Azco completed a financing lease  transaction  that yielded the
Company net  proceeds of  $2,842,500.  Under the terms of the  transaction,  the
Company sold a 40 percent  ownership in the Company's mica  processing  facility
located in Glendale, Arizona. Subsequently, Azco leased the property back for an
initial  period of 10 years,  with an  option  to  repurchase  the stake for 120
percent of the purchase price after the second year. The repurchase price of the
property  increases  by 10  percent of the  purchase  price each year the option
remains  unexercised  up to a maximum  of 150  percent  of the  purchase  price.
Payments for the first 6 months under the lease  agreement are $30,000,  for the
second 6 months they  increase to $37,500  after which time they are $45,000 per
month.

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

In connection  with this  transaction,  the Company issued a warrant to purchase
2,550,000 shares of the Company's  common stock at $.50 per share.  This warrant
vested in January 2002 and is exercisable through January 16, 2007.

The notes payable,  financing lease and related  warrants have been reflected in
the  accompanying  balance  sheet at their  relative  fair values.  The discount
associated  with the notes payable and financing  lease is being  amortized over
the term of the respective instrument using an effective interest method.

The fair value of the  warrants  has been  determined  by the Company  using the
Black Scholes  valuation  model and have been  reflected as  additional-paid  in
capital.

Notes payable at September 30, 2002 consisted of the following:

<TABLE>
<CAPTION>
                                                       Principal      Unamortized Discount
------------------------------------------------- ------------------- --------------------
<S>                                               <C>                 <C>
12% note due September 4, 2003                      200,000                   -
12% note due October 19, 2002                       100,000               2,102
12% note due December 3, 2002                       100,000               6,021
12% note due March 15, 2003                         800,000             143,685

Total                                             1,200,000             151,808
------------------------------------------------- ------------------- --------------------
Financing lease                                   2,018,534           2,481,466
------------------------------------------------------------------------------------------

</TABLE>

Note 5. Contingencies

Litigation

In July 2002,  Azco entered into a settlement  agreement  regarding fees payable
under  terminated  management  agreements  with two of its former  officers  and
directors,  Mr. Alan P. Lindsay and Mr.  Anthony R.  Harvey.  Azco agreed to pay
each former director the sum of $350,000. The amount is to be paid in an initial
payment of $20,000 each, due upon the signing of the  Agreement,  and in monthly
payments of $10,000 thereafter,  with the entire balance due within 24 months of
the date this Agreement is signed. In addition,  Azco paid $24,898  representing
one half of the legal fees incurred by the former directors.  Under the terms of
the  agreement,  Azco  provided  Harvey and Lindsay each with 150,000  shares of
common stock, which shares shall be unrestricted as allowed pursuant to Rule S-8
of the Rules of the Securities and Exchange Commission.

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

On January 22, 1999, the trustee (Petitioner) in bankruptcy  proceedings against
Eagle River served a petition,  in the Quebec Superior Court,  District of Hull,
upon the Company in order to recover  assets from the  Company.  The  Petitioner
alleges  that,  through the Company's  involvement  with Eagle River in the Mali
Project,  the Company is guilty of contractual breaches in excess of $3,400,000.
In management's  opinion,  this claim is unfounded although the eventual outcome
of the case is not yet determinable.

No accrual has been made for this claim  because the Company does not believe it
is probable that the case will be determined against the Company.

On June 25,  2002 Azco  received  a demand  for  arbitration  filed by  iCapital
Corporation  seeking  $144,000  in relief due to failure to pay under a June 26,
2001 Financial Consulting Agreement.  It is the position of Azco and its counsel
that the contract is void and it is unlikely that iCapital will prevail on their
claim.

Note 6. Capital Stock and Outstanding Options

In July 2002, the Company issued 300,000 shares of the Company's common stock in
conjunction with a settlement  agreement  reached in fiscal 2002 with two of its
former  officers and  directors.  The Company did not receive any proceeds  from
this issuance. The settlement amount was accrued at June 30, 2002.

In July 2002, the Company issued 430,000 shares of the Company's common stock in
conjunction with the consulting agreement with Pacifica Financial Group. The
Company did not receive any proceeds from this issuance. The Company has
reflected the value of this transaction of $363,000 as a component of general
and administrative expenses in its Statement of Operations.

In September  2002, the Company  issued  247,525 shares of the Company's  common
stock in  conjunction  with  commitment  fees due on the  Equity  Line of Credit
Agreement  with Cornell  Capital  Partners  LLC. The Company did not receive any
proceeds from this issuance. The fees were accrued at June 30, 2002.

Options to purchase 1,234,500 and 2,815,500 shares of the Company's common stock
were outstanding under the Company's Stock Option Plan at September 30, 2002 and
2001,  respectively.  The impact of these  options  has been  excluded  from the
diluted EPS calculation,  as their effect would be anti-dilutive.  These options
are  exercisable  between  $0.44 and $1.20 per  common  share at  varying  dates
through  2007.  As of  September  30,  2002,  the Company had not issued but has
agreed to issue 10,000 shares of the Company's common stock as a legal retainer.

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

Note 7.Change in Accounting Policy - Accounting for Asset Retirement Obligations

On July 1, 2003,  the Company  adopted the  provisions of Statement of Financial
Accounting  Standards No. 143,  "Accounting  for Asset  Retirement  Obligations"
(SFAS No. 143).  SFAS No. 143 addresses  financial  accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the
associated asset retirement costs estimated to aggregate approximately $250,000.
Specifically,  the Statement requires that retirement  obligations be recognized
when they are incurred and displayed as liabilities with the initial measurement
being at the present  value of  estimated  third party costs.  In addition,  the
asset  retirement cost is capitalized as part of the asset's  carrying value and
subsequently allocated to expense over the assets useful life.

The  asset  retirement  costs  associated  with  the  Mica  project  consist  of
reclamation  of disturbed  property as well as the disposal and  dismantling  of
related property and equipment. The Company previously accounted for these costs
through periodic charges to earnings using the  units-of-production  method. The
change in accounting  resulted in a cumulative  effect charge to earnings during
the period of $13,902.

As of September 30, 2002, the Company maintained the following restricted assets
associated with reclamation costs for the Black Canyon Mica property pursuant to
regulatory requirements:

     -$50,000  held on deposit for the  Arizona  State  Treasurer  in a one-year
     automatically renewable short-term investment; and

     -$140,400 held as collateral against an irrevocable letter of credit of the
     same amount to the U.S. Bureau of Land Management  which renewed October 9,
     2002 for an additional year.

A roll forward of the Company's asset retirement  obligation  through  September
30, 2002 is as follows:

<TABLE>
<CAPTION>
<S>                                                           <C>
Initial liability recognition, July 1, 2002                   $45,309
Accretion                                                       1,250
                                                              -------
Balance, September 30, 2002                                   $46,559
                                                              -------

</TABLE>

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

Note 8. New Pronouncements

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of  Long-Lived  Assets" (SFAS No. 144).  SFAS No. 144 replaces  certain
previously  issued accounting  guidance,  develops a single accounting model for
long- lived assets other than  goodwill and  indefinite-lived  intangibles,  and
broadens the framework  previously  established  for assets to be disposed of by
sale (whether  previously held or newly acquired).  This Statement was effective
as of the  beginning  of fiscal  2003 and did not have a material  impact on the
Company's financial position, results of operations or cash flows.

In April 2002, the FASB issued SFAS No.145,  "Rescission of FASB  Statements No.
4, 44, and 64,  Amendments of FASB Statement No. 13, and Technical  Corrections"
(SFAS  No.145).  This  Statement  rescinds  SFAS No. 4, SFAS No. 64 and  further
clarifies debt extinguishments,  which classify as extraordinary.  Additionally,
SFAS No.  145  amends  SFAS No. 13 in order to clarify  the  accounting  for the
treatment of lease modifications. Provisions of this Statement are effective for
fiscal  year 2003 and the  pronouncement  did not have a material  impact on its
financial position, results of operations or cash flows.

In June 2002,  the FASB issued SFAS No. 146,  "Accounting  for Costs  Associated
with Exit or Disposal Activities" (SFAS No. 146). SFAS No. 146 replaces Emerging
Task  Force  Issue  No.  94-3,  "Liability   Recognition  for  Certain  Employee
Termination  Benefits  and Other Costs to Exit and Activity  (including  Certain
Costs  Incurred in a  Restructuring)".  The  primary  difference  from  existing
guidance  is that SFAS No. 146  requires  the  recognition  of exit cost at fair
value  when a  liability  is  incurred,  versus  at the  date of the  exit  plan
approval.  This  Statement is effective for exit and disposal  activities of the
Company  that are  initiated  after  December  31,  2002.  The  Company  has not
historically had significant exit or disposal activities.

Note 9. Subsequent Events

In October 2002, Azco raised  $500,000 from the sale of convertible  debentures.
These  debentures are  convertible  into shares of common stock,  at the holders
option,  at a price  equal to either (a) an amount  equal to 120% of the closing
bid price of the common  stock as of the closing  date or (b) an amount equal to
80% of the average of the three  lowest  closing bid prices of the common  stock
for the five trading days  immediately  preceding  the  conversion  date.  These
convertible debentures accrue interest at a rate of 6% per year, are convertible
and have a term of two years. At Azco's option,  these debentures may be paid in
cash or redeemed at a 12% premium prior to October 2004.

<PAGE>

Azco Mining Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(Continued)

On  November  12,  2002 the  Form S-1  Registration  Statement,  filed  with the
Securities  and  Exchange  Commission  in regard to the  Equity  Line of Credit,
became   effective.   The  Company  is  now  eligible  to,  at  our  discretion,
periodically  issue and sell to Cornell Capital  Partners shares of common stock
for up to a total  purchase  price of $5 million for a period of up to two years
after November 12, 2002,  whichever comes first.  For each share of common stock
purchased  under the Equity Line of Credit,  Cornell  Capital  Partners will pay
92.5% of the lowest  closing bid price of our common stock on the American Stock
Exchange for the five trading days  immediately  following the notice date.  The
amount of each advance is subject to a maximum of $500,000  per advance,  with a
minimum of five trading  days between  advances.  In addition,  Cornell  Capital
Partners will retain 5% of each advance under the Equity Line of Credit. Cornell
Capital  Partners  received  237,624  shares  of  common  stock  as  a  one-time
commitment  fee,  which was equal to $240,000 based on a closing bid of $1.01 on
June 19, 2002.  Cornell Capital  Partners  intends to sell any shares  purchased
under the Equity Line of Credit at the then prevailing market price.

<PAGE>

Item 2.   Management's Discussion and Analysis of Financial Condition and
Results of Operations

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  contains  statements  concerning  trends  and other  forward-looking
information,   within  the  meaning  of  the  federal   securities   laws.  Such
forward-looking  statements are subject to uncertainties and factors relating to
our operations and business  environment,  all of which are difficult to predict
and many of which are beyond our control. We believe that the following factors,
among others,  could affect our future  performance  and cause actual results to
differ materially from those expressed or implied by forward-looking  statements
made by us or on our behalf: (1) unfavorable weather conditions,  in particular,
high water levels in the Agua Fria river which could temporarily limit access to
the Black Canyon mica mine site;  (2) the lack of  commercial  acceptance of our
mica product or  by-products;  (3) changes in  environmental  laws; (4) problems
regarding  availability  of  materials  and  equipment;  (5) failure of the mica
project  equipment  to process or operate  in  accordance  with  specifications,
including  expected  throughput,  which could prevent the project from producing
commercially viable output; and (6) our lack of necessary financial resources to
complete  development of the mica product and by-products,  successfully  market
our mica product and fund our other capital commitments.

References to "we", "us", "our", and Azco Mining,  refer to Azco Mining Inc. and
its  subsidiaries,  on  a  consolidated  basis,  unless  the  context  otherwise
requires.

General

We were formed in 1988. In December 1995, we sold our Sanchez copper project and
a 70% interest in our Mexican copper  project,  the Piedras Verdes  Project,  to
Phelps Dodge  Corporation for $40 million.  Principal  income since the sale has
been a result of interest earned on the proceeds of the sale of these assets.

We are currently  focused on the start up of our facilities  designed to produce
high  quality  muscovite  mica and  feldspathic  sand from our 100% owned  Black
Canyon  mica  project  located  near  Phoenix,  Arizona.  The Company is seeking
financing that will be necessary to continue operations.

Critical accounting policies and estimates

As of July 1, 2003,  the Company  adopted SFAS 143, which governs the accounting
of the treatment for its asset retirement obligations.  Previously,  the Company
accrued  for such  costs  on a units  of  production  basis  over the  estimated
reserves.  Upon the adoption of the new  standard,  the Company has recorded the
current fair value of its expected cash outflows with its reclamation  activity.
This  change in  accounting  treatment  resulted  in a charge to current  period
earnings of  $13,902.  (See also Note 7 to the  interim  consolidated  financial
statements).

<PAGE>

Results of Operations

Three Months ended  September 30, 2002 compared to Three Months ended  September
30, 2001

The net loss for the three months ended September 30, 2002 was $1,439,862 ($0.04
per share)  compared to a net loss of $ 571,151  ($0.02 per share) for the three
months  ended  September  30,  2001.  The  increased  net loss is the  result of
increased  production  costs and  general  and  administrative  expenses  in the
current period.

Production  expense for the three  months  ended  September 30 2002 was $537,034
compared to $244,917 for the three months ended  September  30, 2001.  Increased
expenses in the current  quarter are due to the initial  production  for sale of
feldspathic sand.

General and  administrative  expense was  $567,314  for the three  months  ended
September 30 2002  compared to $141,389 for the three months ended  September30,
2001.  The increase in general and  administrative  expense is due to a $363,000
charge in the current quarter  resulting from the issuance of 430,000 shares for
consulting services.

Interest  expense was  $163,336  for the three  months  ended  September 30 2002
compared to $21,430 for the three months ended  September 30, 2001. The increase
is due to interest  expense  associated  with loans,  entered into over the last
year, and with the amortization of the value of the related debt discount.

FINANCIAL CONDITION

As of September 30 2002, we had unrestricted cash of $34,284.

Net cash used in operating activities was $753,599 for the first three months of
fiscal 2002 as  compared  to $560,615 in the same period of the prior year.  The
increase was due primarily to payments for the settlement obligation with former
officers  combined with the increase in production  activities  undertaken  this
quarter.

Net cash flows used in  financing  activities  were  $96,764 for the first three
months of fiscal  2002 as  compared  to $550,000 in the same period of the prior
year.  The variance  from the prior year is the result of the proceeds  from two
notes  issued  in the  prior  year  combined  with less  stock  option  exercise
activity.

The Company has suffered  recurring  losses from operations and assuming it will
continue  to operate  as a going  concern it will  require  additional  funds to
continue  operations.  On  November  4,  2002  the  Company  temporarily  ceased
production at its Black Canyon Mine crushing and concentrating facilities due to
cash constraints.  Production will start again once adequate  financing has been
raised.  On November 12, 2002 the  Company's  Form S-1  Registration  Statement,
filed with the Securities  and Exchange  Commission in regard to the Equity Line
of Credit, became effective.  The Company is now eligible to, at our discretion,
periodically  issue and sell to Cornell Capital  Partners shares of common stock
for a total  purchase  price of $5 million for a period of up to two years after
November 12, 2002,  whichever comes first. The Company plans to use the proceeds
for immediate cash needs until a major financing deal can be closed.  Management
is actively seeking additional major financing;  however,  there is no assurance
that these  efforts will be  successful  or on terms  acceptable to the Company.
These  matters  raise doubt about the  Company's  ability to continue as a going
concern.  These consolidated financial statements do not include the adjustments
that would be  necessary,  including a  provision  for  impairment  of plant and
equipment which could be material, should the Company be unable to continue as a
going concern.

The  Company  will need a minimum  of $2 million of  additional  funding  during
fiscal  2003 to cover  operating  requirements.  The  Company is also  seeking a
minimum of $1.5 million of funding for capital  improvements to its Black Canyon
process facilities.

Lease Arrangements and Contractual Obligations

Azco leases some heavy  equipment.  Certain  equipment  leases are classified as
capital  leases and,  accordingly,  the  equipment  and related  obligation  are
recorded on our balance  sheet.  The  Company is  committed  to lease its former
executive  office in Vancouver BC through  April 2004 and currently has a tenant
under a sub-lease contract.

Currently  Azco has a total of $1,200,000  of  short-term  notes due and payable
before   March  15,  2004.   In  addition,   the  Company  has  entered  into  a
sale-leaseback  financing  arrangement where it may re-purchase the equipment it
sold  under  this  transaction  in  January  of 2004 or  thereafter,  but is not
contractually obligated to do so until 2011.

In conjunction with the departure of two former executives in October 2000, Azco
entered into a severance agreement in June 2002 whereby Azco is required to make
monthly  payments of $10,000,  to each  director,  through  June 2004,  with the
remaining balance of $90,000 due in July 2004. Under the terms of the agreement,
Azco was required to provide Messrs. Harvey and Lindsay each with 150,000 shares
of unrestricted  common stock in Azco Mining Inc. The shares were issued in July
2002.

The following table is provided to detail our contractual  obligations and lease
commitments:

<TABLE>
<CAPTION>
                                                                Payments due
                                                Payments due in    in           Payments due
                        Payments due through    1-3 years       4-5 years       after
                        June 30, 2003           2003-2005       2006-2007       2007
<S>                     <C>                     <C>             <C>             <C>
Equipment leases         62,466                    84,727         -               -
Office lease             45,260                    51,400         -               -
Settlement
payments                180,000                   420,000         -               -
Notes payable           201,000                 1,170,000         -               -
Financing lease         382,500                 1,080,000       1,080,000       6,930,000
                        -------                 ---------       ---------       ---------
Total contractual
obligations             871,226                 2,806,127       1,080,000       6,930,000

</TABLE>

New Accounting Pronouncements

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of  Long-Lived  Assets" (SFAS No. 144).  SFAS No. 144 replaces  certain
previously  issued accounting  guidance,  develops a single accounting model for
long- lived assets other than  goodwill and  indefinite-lived  intangibles,  and
broadens the framework  previously  established  for assets to be disposed of by
sale (whether  previously held or newly acquired).  This Statement was effective
as of the  beginning  of fiscal  2003 and did not have a material  impact on the
Company's financial position, results of operations or cash flows.

In April 2002, the FASB issued SFAS No. 145,  "Rescission of FASB Statements No.
4, 44, and 64,  Amendments of FASB Statement No. 13, and Technical  Corrections"
(SFAS No.  145).  This  Statement  rescinds  SFAS No. 4, SFAS No. 64 and further
clarifies debt extinguishments,  which classify as extraordinary.  Additionally,
SFAS No.  145  amends  SFAS No. 13 in order to clarify  the  accounting  for the
treatment of lease modifications. Provisions of this Statement are effective for
fiscal  year 2003 and the  pronouncement  did not have a material  impact on its
financial position, results of operations or cash flows.

In June 2002,  the FASB issued SFAS No. 146,  "Accounting  for Costs  Associated
with Exit or Disposal  Activities".  SFAS No. 146 replaces  Emerging  Task Force
Issue  No.  94- 3,  "Liability  Recognition  for  Certain  Employee  Termination
Benefits and Other Costs to Exit and Activity  (including Certain Costs Incurred
in a  Restructuring)"  (SFAS No.  146).  The primary  difference  from  existing
guidance  is that SFAS No. 146  requires  the  recognition  of exit cost at fair
value  when a  liability  is  incurred,  versus  at the  date of the  exit  plan
approval.  This  Statement is effective for exit and disposal  activities of the
Company  that are  initiated  after  December  31,  2002.  The  Company  has not
historically had significant exit or disposal activities.

<PAGE>

Item 3: Quantitative and Qualitative Disclosures about Market Risk

        None.

Item 4: Controls and Procedures

The Company  maintains a system of disclosure  controls and  procedures  that is
designed  to ensure  information  required  to be  disclosed  by the  Company is
accumulated and  communicated  to management in a timely manner.  Management has
reviewed this system of disclosure controls and procedures within 90 days of the
date  hereof,  and has  concluded  that  the  current  system  of  controls  and
procedures is effective.

The Company maintains a system of internal controls and procedures for financial
reporting. Since the date of management's most recent evaluation,  there were no
significant  changes  in  internal  controls  or in  other  factors  that  could
significantly affect internal controls.

PART II. OTHER INFORMATION

Item 1: Legal Proceedings

On January 22, 1999, the trustee (Petitioner) in bankruptcy  proceedings against
Eagle River served a petition,  in the Quebec Superior Court,  District of Hull,
upon the Company in order to recover  assets from the  Company.  The  Petitioner
alleges  that,  through the Company's  involvement  with Eagle River in the Mali
Project,  the Company is guilty of contractual breaches in excess of $3,400,000.
In management's  opinion,  this claim is unfounded although the eventual outcome
of the case is not yet  determinable.  No  accrual  has been made for this claim
because  the  Company  does not  believe  it is  probable  that the case will be
determined against the Company.

On June 25,  2002 Azco  received  a demand  for  arbitration  filed by  iCapital
Corporation  seeking  $144,000  in relief due to failure to pay under a June 26,
2001 Financial Consulting Agreement.  It is the position of Azco and its counsel
that the contract is void and it is unlikely that iCapital will prevail on their
claim.

<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.

                                                                AZCO MINING INC.
                                                               -----------------
                                                                    (Registrant)

Date:  November 13, 2002                         BY:       /s/ Lawrence G. Olson
       -----------------------                             ---------------------
                                                               Lawrence G. Olson
                                                     CEO, President and Chairman

Date:  November 13, 2002                         BY:         /s/ Ryan A. Modesto
       -----------------                                    --------------------
                                                                 Ryan A. Modesto
                                                         Vice President Finance,
                                                             Corporate Secretary

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection  with the Quarterly  Report of Azco Mining Inc. (the "Company") on
Form 10-K for the period  ended June 30, 2002 as filed with the  Securities  and
Exchange Commission on the date hereof (the "Report"),  each of the undersigned,
in the capacities and on the dates indicated below, hereby certifies pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that to his knowledge:

1. The Quarterly  Report on Form 10-Q for the quarterly  period ended  September
30,  2002 as filed  with the  Securities  and  Exchange  Commission  on the date
hereof,  fully complies with the  requirements  of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; as amended; and

2. The information  contained in the Quarterly  Report fairly  presents,  in all
material  respects,  the  financial  condition  and results of operations of the
Company.

/s/ Lawrence G. Olson
------------------------
Lawrence G. Olson, Chief Executive
Officer

/s/ Ryan Modesto
-----------------------
Ryan Modesto, Vice President Finance

<PAGE>

Certifications

I, Lawrence G. Olson, Chief Executive Officer, certify that:

l. I have reviewed this quarterly report on Form 10-Q of AZCO Mining Inc.;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a) designed such disclosure  controls and procedure to ensure that material
     information   relating  to  the  registrant,   including  its  consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
     procedures  as of a date  within 90 days prior to the  filing  date of this
     quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
     effectiveness  of the  disclosure  controls  and  procedures  based  on our
     evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):

     a) all  significant  deficiencies  in the design or  operation  of internal
     controls which could adversely affect the  registrant's  ability to record,
     process,  summarize and report  financial data and have  identified for the
     registrant's auditors any material weaknesses in internal controls; and

     b) any fraud,  whether or not material,  that involves  management or other
     employees  who  have  a  significant  role  in  the  registrant's  internal
     controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly report whether there were significant  changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.

November 13, 2002

/s/ Lawrence G. Olson
-----------------------
Chief Executive Officer

<PAGE>

I, Ryan Modesto, Vice President Finance, certify that:

l. I have reviewed this quarterly report on Form 10-Q of AZCO Mining Inc.;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a) designed such disclosure  controls and procedure to ensure that material
     information   relating  to  the  registrant,   including  its  consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
     procedures  as of a date  within 90 days prior to the  filing  date of this
     quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
     effectiveness  of the  disclosure  controls  and  procedures  based  on our
     evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):

     a) all  significant  deficiencies  in the design or  operation  of internal
     controls which could adversely affect the  registrant's  ability to record,
     process,  summarize and report  financial data and have  identified for the
     registrant's auditors any material weaknesses in internal controls; and

     b) any fraud,  whether or not material,  that involves  management or other
     employees  who  have  a  significant  role  in  the  registrant's  internal
     controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly report whether there were significant  changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.

November 13, 2002

/s/ Ryan Modesto
----------------------
Vice President Finance