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


                                   Form 10-KSB

[X]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE ACT OF
     1934
     For the fiscal year ended April 30, 2002

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

               For the transition period from _____________ to _____________

     Commission file number 0-33065
                            -------

                             Herrimen Oil & Gas Inc.
                      -------------------------------------
                          Name of Small Business Issuer

                Nevada                                           98-0216152
---------------------------------------------               -------------------
(State or other jurisdiction of incorporation                (I.R.S. Employer
             or organization)                               Identification No.)

     Suite 990, 1500 West Georgia Street
         Vancouver, British Columbia                              V6G 2Z6
---------------------------------------------                  -------------
   (Address of principal executive offices)                      (Zip Code)

Issuer's telephone number: (604) 692-3233
                           --------------

Securities registered under Section 12(b) of the Exchange Act:  None
                                                                ----

Securities registered under Section 12(g) of the Exchange Act:

                         Common Shares, $0.001 par value
                         -------------------------------
                                (Title of class)

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

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

The issuer had no revenues for the year ended April 30, 2002.

The aggregate market value of the voting stock held by non-affiliates of the
registrant as of July 25, 2002, based on the closing trading price of the day of
$0.20 for the issuer's Common Shares, $0.001 par value (the "Common Shares") was
$4,190,522.

The number of shares outstanding of the issuer's common equity, as of July 25,
2002, were 23,052,610.

Transitional Small Business Disclosure Format (Check one):    Yes      No  X
                                                                 -----   -----



<PAGE>


(begin boldface)
Certain  statements  in this Annual  Report on Form 10-KSB,  or the Report,  are
"forward-looking  statements." These forward-looking statements include, but are
not  limited  to,  statements  about the  plans,  objectives,  expectations  and
intentions of Herrimen Oil & Gas Inc., a Nevada corporation (referred to in this
Report as "we," "us" or "our,") and other  statements  contained  in this Report
that are not  historical  facts.  Forward-looking  statements  in this Report or
hereafter  included  in  other  publicly  available  documents  filed  with  the
Securities and Exchange Commission,  or the SEC, reports to our shareholders and
other publicly  available  statements issued or released by us involve known and
unknown  risks,  uncertainties  and other  factors  which could cause our actual
results, performance (financial or operating) or achievements to differ from the
future results,  performance  (financial or operating) or achievements expressed
or implied by such  forward-looking  statements.  Such future  results are based
upon  management's  best  estimates  based upon current  conditions and the most
recent  results of  operations.  When used in this Report,  the words  "expect,"
"anticipate,"  "intend,"  "plan,"  "believe,"  "seek,"  "estimate"  and  similar
expressions  are  generally  intended  to identify  forward-looking  statements.
Because these forward-looking statements involve risks and uncertainties,  there
are important  factors that could cause actual results to differ materially from
those expressed or implied by these  forward-looking  statements,  including our
plans, objectives, expectations and intentions and other factors discussed under
"Risk Factors."
(end boldface)


                                     PART I


Item 1.  Description of Business.
---------------------------------

History and Organization:
-------------------------

We are a corporation organized under the laws of the State of Nevada on November
24,  1998,  to  explore  and  develop  or  participate  in the  exploration  and
development of oil and gas properties in California.

Expansion Strategy
------------------

We intend to continue to acquire  interests  in  properties  and leases with the
intent of participating in the exploration for oil and gas primarily in, but not
limited  to,  California.  We  anticipate  that we will  fund the costs of these
acquisitions  and  developments  through  future  purchases  of common  stock by
private  investors.  If funds become  available from revenues from producing oil
and gas wells  (which is  currently  not the case) then those  funds may be made
available for expansion and for increasing production facilities.

Over the last two fiscal  years we have not spent any money on  exploration  and
development.

Employees. We currently have one full-time employee. We have experienced no work
----------
stoppages and believe that our employee relations are good.

Risk Factors
------------

Limited Operating History; Development Stage Company. We were incorporated under
-----------------------------------------------------
the laws of Nevada on November 24, 1998, and therefore have a limited  operating
history. For the period from inception to April 30, 2002, we have incurred a net
loss of  $472,181.  We face all of the  risks  inherent  in a new  business.  In
addition, we can only provide limited historical  information and financial data
about our  operations  upon which a  prospective  investor  can make an informed
decision  as to our  future  prospects.  Estimates  with  respect  to the proved
reserves and level of future  production  attributable  to wells in which we may
participate  are  difficult to determine and there can be no assurance as to the
volume of  recoverable  reserves  that will be  realized  from such  wells.  Our
prospects  must be considered in light of the risks,  expenses and  difficulties
frequently  encountered  by companies in the early stages of their  development.
Our future financial results will depend primarily on our ability to participate
in  properties  which result in the  production  of  hydrocarbons  in commercial
quantities  and on the market  prices for oil and natural  gas.  There can be no
assurance that we will achieve or sustain  profitability  or positive cash flows
from operating activities in the future.

Competition. The search for viable oil and gas prospects and leases is intensely
------------
competitive.  It is likely that in seeking future acquisitions,  we will compete
with firms which have substantially  greater financial and management  resources
than us. We may  acquire  interests  in  mineral  leases  and lease  acquisition

                                        2
<PAGE>




opportunities  in known,  proven,  producing  fields,  or on  unknown,  unproven
territories or leases with no contiguous  producing well sites.  Our competition
is widely diverse, and comes primarily from three sources: (1) those competitors
that  are  seeking  oil and gas  fields  for  expansion,  further  drilling,  or
increasing production through improved engineering techniques (2) income-seeking
entities  purchasing  a  predictable  stream of  earnings  based  upon  historic
production  from the field  being  acquired,  and (3) junior  companies  seeking
exploration opportunities in unknown, unproven territories.

Affiliate  Transactions.   We  have  entered  into  an  agreement  (the  "Option
------------------------
Agreement") with Brothers Oil & Gas Inc. ("Brothers"),  whereby Brothers granted
us an option  to  acquire  Brothers'  interest  in the  Pioneer  Canal  Prospect
covering approximately 240 acres in Kern County, California.

Several members of the Sewell family control Brothers. The directors of Brothers
are Allen Sewell and Michael  Sewell.  Michael  Sewell is Allen Sewell's son and
Graeme  Sewell's  brother.  Allen  Sewell  and  Graeme  Sewell  are  two  of our
directors.  Brothers' shareholders are Allen Sewell, his sons Michael Sewell and
Brian Sewell,  and Nathan Nocke,  who is Allen Sewell's  step-son.  As such, our
execution  of the  Option  Agreement  with  Brothers  was  not  an  arm's-length
transaction  with a  non-affiliate.  While Allen Sewell has a fiduciary  duty to
deal fairly with us and our  shareholders,  there is no guarantee that the terms
of the  transaction  were  similar  to what we would have  received  in an arms'
length transaction with a non-affiliate.

No Assurance of Success or Profitability. There can be no assurance that we will
-----------------------------------------
be able to generate profits or otherwise operate successfully.

No Assurance of Dividends.  There can be no assurance that we will pay dividends
--------------------------
on our capital stock in the  foreseeable  future.  Investors who  anticipate the
need for immediate income from their investment in our securities should refrain
from the purchase of our securities.

"Penny Stock" Rules. Our shares will be subject to rules  promulgated by the SEC
--------------------
relating to "penny  stocks,"  which apply to  non-NASDAQ  companies  whose stock
trades at less than  $5.00  per share or whose  tangible  net worth is less than
$2,000,000. These rules require brokers who sell "penny stocks" to persons other
than  established  customers  and  "accredited  investors"  to complete  certain
documentation,  make suitability  inquiries of investors,  and provide investors
with certain information concerning the risks of trading in the security.  These
rules may  restrict  the  ability of  brokers  to sell our Common  Stock and may
affect the  ability of  purchasers  to sell such Common  Stock in the  secondary
market.

Conflicts of Interest.  Certain of our directors are directors,  officers and/or
----------------------
shareholders  of other  companies that are engaged in the business of acquiring,
developing and exploiting  natural resource  properties.  Such  associations may
give rise to  conflicts  of  interest  from time to time.  These  directors  are
required  by law to act  honestly  and in good  faith  with a view  to our  best
interests  and to disclose  any  interest  which they may have in any project or
opportunity to us.

General Risks of the Oil and Gas Industry
-----------------------------------------

Dependence on Exploratory Drilling Activities.  Our success in the participation
----------------------------------------------
of  exploration  for oil & gas will be materially  dependent upon the success of
any exploratory drilling programs. Exploratory drilling involves numerous risks,
including the risk that no commercially productive oil or natural gas reservoirs
will be  encountered.  The cost of drilling,  completing and operating  wells is
often uncertain,  and drilling operations may be curtailed,  delayed or canceled
as a result of a variety of factors,  including  unexpected drilling conditions,
pressure or  irregularities  in  formations,  equipment  failures or  accidents,
adverse  weather  conditions,  compliance  with  governmental  requirements  and
shortages  or delays in the  availability  of drilling  rigs and the delivery of
equipment.   Our  participation  in  future  drilling   activities  may  not  be
successful,  and if  unsuccessful,  such  failure  will have a material  adverse
effect on our results of operations and financial condition.

Volatility of Oil And Natural Gas Prices.  Our revenues,  future rate of growth,
-----------------------------------------
results of operations, financial condition and ability to borrow funds or obtain
additional  capital,  as well  as the  carrying  value  of our  properties,  are
substantially   dependent  upon  prevailing  prices  of  oil  and  natural  gas.
Historically,  the markets for oil and natural gas have been volatile,  and such
markets are likely to continue to be volatile in the future.  Prices for oil and
natural gas are subject to wide  fluctuations  in response to  relatively  minor


                                        3
<PAGE>




changes in the supply of and demand for oil and natural gas, market  uncertainty
and a variety of additional  factors that are beyond our control.  These factors
include the level of consumer product demand,  weather conditions,  domestic and
foreign  governmental  regulations,  the price and  availability  of alternative
fuels,  political  conditions in the Middle East,  the foreign supply of oil and
natural gas, the price of foreign imports and overall economic conditions. It is
impossible to predict future oil and natural gas price movements with certainty.
Declines  in oil and  natural  gas prices may  materially  adversely  affect our
financial condition,  liquidity, ability to finance planned capital expenditures
and results of operations.  Lower oil and natural gas prices also may reduce the
amount  of oil and  natural  gas  that  can be  produced  economically  on those
properties in which we have an interest.

In order to reduce our exposure to short-term  fluctuations  in the price of oil
and natural  gas,  we may  periodically  enter into  hedging  arrangements.  Our
hedging arrangements may apply to all or to only a portion of our production and
provide only partial price  protection  against  declines in oil and natural gas
prices.  Such hedging  arrangements  may expose us to risk of financial  loss in
certain  circumstances,  including  instances  where  production  is  less  than
expected, our customers fail to purchase contracted quantities of oil or natural
gas or a sudden,  unexpected event materially impacts oil or natural gas prices.
In addition,  our hedging  arrangements,  if any, may limit the benefit to us of
increases in the price of oil and natural  gas. As of the date of this  document
we had not engaged in hedging.

Reserve  Replacement  Risk. In general,  the volume of  production  from oil and
---------------------------
natural  gas  properties  declines as reserves  are  depleted,  with the rate of
decline  depending  on  reservoir  characteristics.  Except  to  the  extent  we
participate  in successful  exploration  and  development  activities or acquire
properties containing proved reserves, or both, our proved reserves will decline
as reserves are produced.  Our ability to profit from future oil and natural gas
production is, therefore,  highly dependent upon our level of success in finding
or acquiring additional  reserves.  The business of exploring for, developing or
acquiring reserves is capital intensive. To the extent cash flow from operations
is reduced and external  sources of capital become limited or  unavailable,  our
ability to make the necessary capital investment to maintain or expand our asset
base of oil and  natural  gas  reserves  will be  impaired.  The  failure  of an
operator  of our wells to  adequately  perform  operations,  or such  operator's
breach of the applicable  agreements,  could  adversely  impact us. In addition,
there  can  be  no  assurance  that  our  future  exploration,  development  and
acquisition activities will result in additional proved reserves or that we will
be able to drill productive wells at acceptable costs. Furthermore, although our
revenues  could  increase if prevailing  prices for oil and natural gas increase
significantly, our funding and development costs could also increase.

Operating  Risks of Oil And  Natural  Gas  Operations.  The oil and  natural gas
------------------------------------------------------
business involves certain  operating hazards such as well blowouts,  craterings,
explosions,  uncontrollable  flows of oil,  natural gas or well  fluids,  fires,
formations  with abnormal  pressures,  pipeline  ruptures or spills,  pollution,
releases of toxic gas and other  environmental  hazards and risks,  any of which
could result in substantial losses to us. The availability of a ready market for
our oil and natural gas production also depends on the proximity of reserves to,
and the  capacity  of oil and  natural  gas  gathering  systems,  pipelines  and
trucking  or  terminal  facilities.  We may  deliver  natural  gas  through  gas
gathering  systems  and gas  pipelines  that we do not own.  Federal  and  state
regulation of natural gas and oil production and transportation,  tax and energy
policies, changes in supply and demand and general economic conditions all could
adversely  affect our ability to produce and market our oil and natural  gas. In
addition,  we may be liable for environmental  damages caused by previous owners
of  property  purchased  and leased by us or by other  parties  through  whom we
participate in such properties or leases. As a result,  substantial  liabilities
to third parties or governmental entities may be incurred,  the payment of which
could reduce or eliminate the funds  available for  exploration,  development or
acquisitions  or  result  in the  loss of our  properties.  In  accordance  with
customary  industry  practices,  our contractors  may elect to obtain  insurance
against some,  but not all, of such risks and losses.  We do not carry  business
interruption  insurance. We may elect to self-insure if management believes that
the cost of  insurance  is not  excessive  relative to the risks  presented.  In
addition,  pollution and environmental  risks generally are not fully insurable.
The occurrence of an event not fully covered by insurance  could have a material
adverse  effect on our  financial  condition and our results of  operations.  We
anticipate participating in a substantial percentage of our interests in oil and
gas properties on a non-operated  basis,  which may limit our ability to control
the risks associated with oil and natural gas operations.

Technological  Changes.  The oil and gas industry is  characterized by rapid and
-----------------------
significant  technological  advancements  and  introductions of new products and
services utilizing new technologies.  As others use or develop new technologies,

                                        4
<PAGE>




we may be placed at a competitive  disadvantage,  and competitive  pressures may
force us to implement such new  technologies  at substantial  cost. In addition,
other oil and gas companies may have greater financial,  technical and personnel
resources  that  allow  them to enjoy  technological  advantages  and may in the
future allow them to implement  new  technologies  before we do. There can be no
assurance  that we will be able to respond  to such  competitive  pressures  and
implement such  technologies on a timely basis or at an acceptable  cost. One or
more of the technologies  currently  utilized by us or implemented in the future
may become obsolete. In such case, our business, financial condition and results
of  operations  could be  materially  adversely  affected.  If we are  unable to
utilize the most  advanced  commercially  available  technology,  our  business,
financial  condition and results of operations could be materially and adversely
affected.

Government Regulation and Environmental  Matters. Oil and natural gas operations
-------------------------------------------------
are subject to various federal, state and local government regulations which may
be changed  from time to time in response to economic or  political  conditions.
Matters subject to regulation include discharge permits for drilling operations,
drilling  bonds,  reports  concerning  operations,  unitization  and  pooling of
properties  and taxation.  From time to time,  regulatory  agencies have imposed
price controls and  limitations on production by restricting the rate of flow of
oil and natural gas wells below actual production  capacity in order to conserve
supplies of oil and natural gas. We are also  subject to changing and  extensive
tax laws,  the effects of which  cannot be  predicted.  Legal  requirements  are
frequently changed and subject to  interpretation,  and we are unable to predict
the ultimate cost of compliance  with these  requirements or their effect on its
operations.  No assurance  can be given that existing  laws or  regulations,  as
currently  interpreted  or  reinterpreted  in the  future,  or  future  laws  or
regulations  will not materially  adversely affect our results of operations and
financial   condition.   The   development,   production,   handling,   storage,
transportation  and  disposal of oil and natural  gas,  by-products  thereof and
other  substances  and  materials  produced or used in  connection  with oil and
natural  gas  operations  are  subject  to  federal,  state and  local  laws and
regulations   primarily   relating  to   protection  of  human  health  and  the
environment. The discharge of oil, natural gas, or pollutants into the air, soil
or water may give rise to significant  liabilities on our part to the government
and third parties and may require us to incur substantial costs of remediation.

Acquisition Risks. The successful  acquisition of producing  properties requires
------------------
an  assessment  of  recoverable  reserves,  future oil and  natural  gas prices,
operating  costs,  potential  environmental  and  other  liabilities  and  other
factors.  Such assessments are necessarily inexact and their accuracy inherently
uncertain.  In connection  with such an  assessment,  we perform a review of the
subject  properties  that we believe to be generally  consistent  with  industry
practices,  which may or may not include  obtaining a report from an independent
geologist.  Such a review,  however,  will not reveal all  existing or potential
problems  nor will it permit a buyer to become  sufficiently  familiar  with the
properties to fully assess their deficiencies and capabilities.  Inspections may
not always be performed on every well, and structural and environmental problems
are not necessarily observable even when an inspection is undertaken.  Even when
problems  are  identified,  the  seller  may be  unwilling  or unable to provide
effective contractual protection against all or part of such problems. There can
be no  assurances  that any  acquisition  of property  interests  by us would be
successful  and, if  unsuccessful,  that such failure  would not have an adverse
effect on our future results of operations and financial condition.

Shortage  of  Equipment  Services,   Supplies  and  Personnel.  There  is  often
--------------------------------------------------------------
competition for scarce drilling and completion equipment, services and supplies.
There can be no assurance that  sufficient  drilling and  completion  equipment,
services and supplies will be available when needed.  Any such  shortages  could
delay our proposed  exploration,  development,  and sales  activities  and could
cause a material adverse affect to our financial condition.

If the demand for, and wage rates of,  qualified  rig crews rise in the drilling
industry  then the oil and gas  industry may  experience  shortages of qualified
personnel to operate drilling rigs. This could delay our drilling operations and
adversely affect our financial condition and results of operations.

The SEC maintains an Internet site  (http://www.sec.gov)  that contains reports,
proxy and information  statements,  and other  information  regarding  reporting
issuers.  All of our electronic  filings with the SEC are available on the SEC's
site.

                                        5
<PAGE>




Item 2.  Description of Property.
---------------------------------

The significant properties in which we have an interest are described below.

OFFICE
------

We occupy an office of  approximately  2,900  square  feet at 1500 West  Georgia
Street, Suite 990, Vancouver, British Columbia, Canada. Management believes that
such  offices  will be  satisfactory  during  the near term for the  conduct  of
business.  We share this office with several  other public  companies  with some
directors in common.

PIONEER CANAL PROSPECT
----------------------

Option Agreement with Brothers
------------------------------

By agreement (the "Option  Agreement")  dated November 27, 1998 between Brothers
and us, we have an option (the "Option") to acquire  Brothers' 13% (approximate)
interest  ("Brothers'  Interest")  in a property (the  "Property")  known as the
Pioneer Canal Prospect.  The Property comprises  approximately 240 acres in Kern
County,  California.  The total  acreage is divided  into 160 acres for the 61-9
Well and 80 acres for the 18 R Well. As of the date of this Report, we have paid
$45,000 to  Brothers on account of the Option.  In  addition,  we paid a $25,000
finder's fee with respect to this Option.

The exercise price of the Option is $750,000, if exercised,  we would earn a 12%
and a 13% working interest in the two wells.

The Option originally terminated on June 30, 1999, but by a letter from Brothers
dated June 18, 1999 the option was  extended.  By letters  from  Brothers  dated
December  31,  2001,  and June 25,  2002,  the  Option  has been  extended  on a
month-to-month basis until terminated in writing with thirty days notice.

The Pioneer Canal field lies in the central area of the Bakersfield  Arch in the
southern San Joaquin basin. The principal property is referred to as the Pioneer
Canal area of the Canal Oil field  located in  Township  30 South Range 25 East,
Sections 3,4,9,10 in Kern County, California. There is year around access off of
existing gravel roads.

Brothers' Interest in the Property
----------------------------------

EOTT  Partners Ltd.  ("EOTT") is the fee simple owner of the Property.  EOTT, by
agreement  (the  "Lease")  dated March 28,  1997,  leased to Vaughan  Production
Company  ("Vaughan")  the oil and gas rights to the  Property.  Pursuant  to the
Lease,  Vaughan  (on its own and as  nominee  for  Production  Specialties  Co.,
Vaughan Exploration, Inc., Sunset Exploration, Inc. and Brothers,  collectively,
the  "Lessees")  obtained the right  ("Vaughan's  Interest") to prospect,  mine,
drill,  and  operate  on the  Property  in order to produce  oil,  gas and other
substances.  The term of the Lease is three years from March 28, 1997 and for so
long after as  development  or  production  is  maintained  by Vaughan in paying
quantities on the Property without cessation for more than 120 consecutive days,
or such  operations  are  suspended  or  excused as  provided  for in the Lease.
Pursuant  to the terms of the Lease,  EOTT is  entitled to a 20% royalty on oil,
gas and other substances within the Property.  In addition to a 20% royalty owed
to EOTT as owners of the Property,  the Property is subject to a 2.5% overriding
royalty interest in favour of Vaughan,  Vaughan  Exploration,  Inc. and Argonaut
Oil & Gas Consultants.

The  Lessees  subsequently  entered  into an  agreement  (the  "Farmout")  dated
September 15, 1997 between Vaughan and others as Farmor, and Elk Slough Partners
("Elk") as Farmee,  pursuant to which Elk paid for and  drilled an initial  test
well (the "#18R-3") on the Property.  In  consideration  for the drilling of the
#18R-3,  Elk earned a 75% working interest ("Elk's  Interest") in the #18R-3 and
any subsequent wells drilled on the Property.  Pursuant to the Farmout, Brothers
acquired  a 9%  working  interest  ("Brothers'  Interest")  after  payout in the
#18R-3.

                                        6
<PAGE>




Pursuant to an agreement (the "Pasco Agreement") dated November 3, 1997, between
Elk and Pasco Pacific  Management Corp.  ("Pasco"),  Pasco acquired one third of
Elk's Interest (being a 25% working  interest in the Property).  Under the terms
of the Pasco Agreement,  Brothers will earn a further 4% working interest in the
Property, thereby reducing Pasco's working interest in the Property to 21%. As a
result,  Brothers now holds a 13% working  interest after payout in the Property
pursuant to the Farmout (9%) and the Pasco Agreement (4%).

Brothers entered into a Participation  Agreement with First Goldwater  Resources
Inc. ("First  Goldwater")  dated March 20, 1998,  whereby First Goldwater was to
fund a 25% working  interest  before payout in  development of the Pioneer Canal
#61-9 Well. After payout Brothers was to earn 8%, leaving First Goldwater with a
17% working  interest after payout.  This agreement was amended on June 23, 1998
to the extent that First Goldwater is to fund a 27.933% working  interest before
payout to earn an 18.99444% working interest after payout.

If we  exercise  the  Option  then we will  become a party to a joint  operating
agreement (the "JOA") dated September 29, 1997 with  Production  Specialties Co.
("Production Specialties") as operator and we, among others, as non-operator.

Summary
-------

To date on the Property, the #18R-3 has been drilled as an initial test well and
the #61-9 and the #12-10 have been drilled as  development  wells.  By virtue of
the Lease, the Farmout,  the First Goldwater and the Pasco Agreements,  Brothers
has a 13% after payout  working  interest in the  Property.  By  exercising  the
Option, we could acquire 13% after payout working interest.

#18R-3 Well - Current Status
----------------------------

The following  information  regarding the #18R-3 well has been  extracted  from,
except  for  production  figures  which are the most  current  available,  brief
geological  overviews of the Pioneer Canal  Prospect  provided to us on February
16, 1998 and July 8, 1999 by Jeffrey K. Vaughan,  President and sole shareholder
of Vaughan Exploration,  Inc., and a Certified Petroleum Geologist. As discussed
above,  Vaughan  Production  Company  is a party  to the JOA.  Richard  Vaughan,
Jeffrey K. Vaughan's father,  owns Vaughan  Production  Company.  As a result of
these relationships, this information is not from an independent source:

The #18R-3 was drilled to a depth of 9,298  feet.  The well  initially  produced
approximately  120  barrels of oil per day,  35 barrels of water per day and 150
thousand cubic feet of gas per day.

The #18R-3 has produced 36,639 barrels of 37-gravity oil since first  production
in December  1997 through April 30, 2001.  It has a current  average  production
rate of 19 barrels of oil per day and 27  barrels of water per day  through  the
use of a pump.  The most recent  crude price which  Production  Specialties  has
received for this gravity oil is $25.79 per barrel.

#61-9 Well - Current Status
---------------------------

The  following  description  of the  #61-9 is a summary  of and is based  upon a
report (the "Report")  dated March 11, 1998,  prepared for Vaughan  Exploration,
Inc. by Jeffrey K Vaughan.  The Report was  reviewed  and  endorsed on March 12,
1998 by David E. Olson, a California Registered Geologist,  who has no direct or
indirect interest in the property which is the subject of the Report:

Abstract
--------

The #61-9 is a development well in the Pioneer Canal area of the Canal Oil field
in Kern County,  California.  It is a 10,800 foot  development  well, the #18R-3
being the initial test well on the  Property.  The #61-9  coordinates  are 1,650
feet west and 435 feet south of the NE Corner of Section 9, T.30S/R.25E,  MDB&M,
Kern County, California.

                                        7
<PAGE>




Land
----

By drilling  the #18R-3 and the #61-9,  Elk holds the current  land block of 200
acres by production of oil and gas from the two wells.

The following  information is a summary of and is based upon a brief  geological
status  update on the  status of the #61-9  provided  to us on June 23,  1999 by
Jeffrey K. Vaughan:

As April 30, 2001,  the #61-9 has produced  50,009 barrels of 37-gravity oil per
day. Currently,  natural gas is being produced as a by-product of oil production
and is being  delivered to EOTT through a pipeline  partially  financed by EOTT.
The Pioneer Canal partners are not entitled to any revenues from gas sales until
EOTT receives their capital cost. After the current deliverability of 50 mcf/day
we do not  expect  that the  pipeline  will  ever  amortize  its  capital  cost,
therefore there ill be no revenues to the project.

The well was originally completed from the Middle Stevens (horizontal)  interval
below  9,700 feet which swab  tested at rates up to 600  barrels of oil per day.
That zone was not capable of flowing on its own and the Upper  Stevens  interval
from 8,965 to 8,978 feet was perforated and added or co-mingled  with the Middle
Stevens zone.

After perforating the Upper Stevens interval,  the well flowed (and produced) at
rates up to 206 barrels per day. The well went into  production on February 6th,
1999 and is still currently  flowing on pump at an average rate of 37 barrels of
oil per day and 18 barrels of water per day.

PIONEER CANAL PULV AND OLCESE PROSPECTS
---------------------------------------

The following  information is a summary of and is based upon a geological report
on the Pulv and Olcese Prospects  located in the Pioneer Canal Oil Field in Kern
County,  California.  Jeffrey K. Vaughan provided the geological report to us on
February 17, 1998:

We believe that a greater  potential for oil and gas  exploration  exists in the
deeper  Pulv  zone  at  approximately   10,700  feet  and  the  Olcese  zone  at
approximately 11,800 feet under the existing land block at Pioneer Canal.

At present, we intend to exercise the Option only if the Pulv and Olcese targets
are going to be drilled.

The current plans are to await the drilling  results from adjacent lands. If the
results of such  drilling  warrant the  drilling of a well to test these  deeper
zones on the  Property,  then the Operator  intends to drill one well to explore
both the Pulv and Olcese targets.


Item 3.  Legal Proceedings.
---------------------------

We are not aware of any pending  litigation nor do we have any reason to believe
that any such litigation exists.


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

No matters were  submitted to a vote of our security  holders  during the fiscal
year ended April 30, 2002.

                                        8
<PAGE>




                                     PART II


Item 5.  Market for Common Equity and Related Stockholder Matters.
------------------------------------------------------------------

Reports to Security Holders.
----------------------------

As of July 25, 2002, our authorized capital stock consisted of 50,000,000 shares
of Common Stock,  par value $0.001 per share, or the Common Stock. As of July 25
2002, there were issued and outstanding 23,052,610 shares of Common.

We are a reporting company with the SEC. We participate in the  Over-the-Counter
Bulletin  Board  Quotation  Service   maintained  by  National   Association  of
Securities Dealers, Inc. ("OTCBB").  The OTCBB is an electronic quotation medium
for  securities  traded  outside of the Nasdaq  Stock  Market and prices for our
common stock are  published on the OTC Bulletin  Board under the trading  symbol
"HRMO".  The OTCBB market is extremely  limited and the prices  quoted are not a
reliable indication of the value of our common stock.

The first trade of our Common Stock on the Bulletin  Board occurred in May 2002.
The following  table sets forth the  quarterly  high and low closing sale prices
for the Common  Stock for the periods  indicated  below,  based upon  quotations
between  dealers,  without  adjustments  for  stock  splits,  dividends,  retail
mark-ups,  mark-downs or commissions,  and therefore,  may not represent  actual
transactions:

                                              High         Low
                                              ----         ---
Year Ending April 30, 2003

First Quarter                               $  0.25      $  0.20


There have been no cash  dividends  declared on our common stock.  Dividends are
declared at the sole discretion of our Board of Directors.

Our transfer  agent is Pacific Stock  Transfer  located at 500 East Warm Springs
Road, Suite 240, Las Vegas, Nevada, 89119, Tel: (702) 361-3033.

Penny Stock Regulation.  Shares of our Common Stock are subject to rules adopted
-----------------------
by the SEC that regulate broker-dealer practices in connection with transactions
in "penny stocks".  Penny stocks are generally equity securities with a price of
less than $5.00 (other than securities registered on certain national securities
exchanges or quoted on the Nasdaq system, provided that current price and volume
information  with respect to transactions in those securities is provided by the
exchange or system).  The penny stock rules require a broker-dealer,  prior to a
transaction  in a penny stock not otherwise  exempt from those rules,  deliver a
standardized  risk disclosure  document  prepared by the SEC, which contains the
following:

- a  description  of the nature and level of risk in the market for penny stocks
in both public offerings and secondary trading;
- a  description  of the broker's or dealer's  duties to the customer and of the
rights and remedies  available to the customer with respect to violation to such
duties or other requirements of securities' laws;
- a brief, clear, narrative description of a dealer market,  including "bid" and
"ask" prices for penny  stocks and the  significance  of the spread  between the
"bid" and "ask" price;
- a toll-free telephone number for inquiries on disciplinary actions;
- definitions of significant terms in the disclosure  document or in the conduct
of trading in penny stocks; and
- such other information and is in such form (including language, type, size and
format), as the SEC shall require by rule or regulation.

                                        9
<PAGE>




Prior to effecting any transaction in penny stock, the  broker-dealer  also must
provide the customer the following:


- the bid and offer quotations for the penny stock;
- the compensation of the broker-dealer and its salesperson in the transaction;
- the  number  of  shares  to which  such  bid and ask  prices  apply,  or other
comparable  information  relating to the depth and  liquidity  of the market for
such stock; and
- monthly account  statements  showing the market value of each penny stock held
in the customer's account.

In  addition,  the penny stock rules  require that prior to a  transaction  in a
penny stock not otherwise exempt from those rules, the broker-dealer must make a
special written  determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written  acknowledgment of the receipt
of a risk disclosure  statement,  a written agreement to transactions  involving
penny stocks, and a signed and dated copy of a written suitably statement. These
disclosure  requirements may have the effect of reducing the trading activity in
the secondary  market for a stock that becomes subject to the penny stock rules.
Holders of shares of our Common Stock may have  difficulty  selling those shares
because our common stock will probably be subject to the penny stock rules.


Item 6.  Management's Discussion and Analysis or Plan of Operation.
-------------------------------------------------------------------

The  following   information   specifies   forward-looking   statements  of  our
management.   Forward-looking   statements  are  statements  that  estimate  the
happening of future events and are not based on historical fact. Forward-looking
statements may be identified by the use of  forward-looking  terminology such as
"may",  "will",  "could",  "expect",   "estimate",   "anticipate",   "probable",
"possible", "should", "continue", or similar terms, variations of those terms or
the negative of those terms.  Actual  results may differ  materially  from those
contemplated by the forward-looking statements.

The assumptions used for purposes of the forward-looking statements specified in
the following  information  represent estimates of future events and are subject
to uncertainty as to possible changes in economic,  legislative,  industry,  and
other circumstances.  As a result, the identification and interpretation of data
and other information and their use in developing and selecting assumptions from
and among  reasonable  alternatives  require the  exercise of  judgment.  To the
extent that the assumed events do not occur, the outcome may vary  substantially
from anticipated or projected results, and, accordingly, no opinion is expressed
on the achievability of those  forward-looking  statements.  No assurance can be
given that any of the  assumptions  relating to the  forward-looking  statements
specified in the following information are accurate, and we assume no obligation
to update any such forward-looking statements.

Results of Operation
--------------------

The following  discussion  should be read in conjunction  with the audited April
30, 2002 financial statements and notes thereto included herein.

We  generated  no  revenues  during  the year ended  April 30,  2002 and we have
recorded a net loss of $77,816  compared  to a net loss of $74,471  for the year
ended April 30, 2001, an increase of $3,345.

The  increase in net loss was mainly  attributable  to the increase in audit and
accounting  expenses.  We are not aware of any trends,  demands,  commitments or
uncertainties  that will result in our  liquidity  decreasing or increasing in a
material way.

We cannot predict when, and if, we will realize positive revenue.

Liquidity and Capital Resources
-------------------------------

As of April 30, 2002, we had a working capital deficit of $184,325 compared to a
deficit of $106,509 at April 30, 2001.  We have been  financing  our  operations
primarily  from   related-party   cash  advances  and  through   private  equity


                                       10
<PAGE>




subscriptions.  We have arranged  with our  directors to fund ongoing  operating
costs,  except for management fees due to Allen Sewell.  Allen Sewell has agreed
to defer payment of management fees until such time as we carry out a subsequent
financing.  We intend to raise additional funds in order to drill or participate
in the  drilling of oil and gas wells,  make option  payments,  and to generally
meet our future  corporate  obligations.  There is no guarantee  that we will be
successful in arranging the required financing.

Plan of Operation.  We have not received  revenue from operations  during any of
------------------
the three  fiscal  years  immediately  prior to the  filing of this  Report.  We
currently have cash reserves of approximately $1,080, which, even given our lack
of business  activities,  we believe will not satisfy our cash  requirements for
approximately  one-hundred  and twenty (120) days  following  the filing of this
Report. We intend to raise additional financing through private offerings of our
Common Stock.  We will offer such stock for sale only after we have identified a
viable business opportunity. We will use the capital raised from such activities
to finance future business activities.

Our future  success  will be  materially  dependent  upon our ability to satisfy
additional  financing  requirements.  We are  reviewing  our  options  to  raise
substantial equity capital. We cannot estimate when we will begin to realize any
revenue.  In  order to  satisfy  our  requisite  budget,  we have  held and will
continue to conduct  negotiations  with  various  investors.  We cannot  predict
whether these  negotiations will result in additional  investment income for us.
There can be no  assurance  that  funding for our  operations  will be available
under favorable terms, if at all.


Item 7.  Financial Statements.
------------------------------

The financial  statements required by this Item 7 are included elsewhere in this
Report and incorporated herein by this reference.


Item 8.  Changes  in  and  Disagreements  with  Accountants  on  Accounting  and
--------------------------------------------------------------------------------
         Financial Disclosure.
         ---------------------

There have been no changes in or  disagreements  with our accountants  since the
formation  of the  Company  required  to be  disclosed  pursuant  to Item 304 of
Regulation S-B.


                                    PART III


Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
--------------------------------------------------------------------------------
        with Section 16(a) of the Exchange Act.
        ---------------------------------------

The following table sets forth  information  regarding our current directors and
executive officers:

<TABLE>
<CAPTION>
==============================================================================================
Name               Age    Position/Office held with the Company [1]    Appointed to Office
==============================================================================================
<S>                <C>    <C>                                          <C>
Allen Sewell       64     Director                                     February 19, 1999
                          President                                    February 1, 2001

Graeme Sewell      35     Director                                     November 24, 1998
                          Vice President                               February 1, 2001

Nick De Cotiis     42     Director                                     January 1, 1999

Conrad Clemiss     33     Director                                     February 19, 1999

Don De Cotiis      45     Director                                     March 22, 1999

Negar Towfigh      29     Corporate Secretary                          February 19, 1999
==============================================================================================
</TABLE>

                                       11
<PAGE>




ALLEN SEWELL (Graeme Sewell's father) Mr. Sewell has been President and Director
------------
of Brothers Oil & Gas Inc.  since 1997, and President and Director of ELK Slough
Pipeline  Co.  since  April  1981.  In  his  role  with  these  companies  he is
responsible for day-to-day  management,  acquisitions and financial  operations.
Mr. Sewell is also a director of First  Goldwater  Resources Inc. Mr. Sewell has
also been  involved  in real  estate  development  including  land  acquisition,
rezoning,  development  and financing  since 1969. Mr. Sewell was previously the
Manager  of  Administration  for  the  National  Real  Estate  Division  of  The
Permanent.

GRAEME SEWELL  (Allen  Sewell's son) Mr. Sewell is currently a Director of First
-------------
Goldwater  Resources  Inc. Mr.  Sewell has 14 years'  experience  in finance and
accounting and is responsible for negotiating contracts and arranging financings
for us and for several  other  companies.  Mr.  Sewell has  participated  in the
financing of numerous oil and gas, resource and technology companies. Mr. Sewell
was formerly with Canaccord  Capital  Corporation as a Sales  Assistant and from
February  1996 to  November  1998 as an  Investment  Advisor.  Prior to this Mr.
Sewell was an accountant with Amisano Hanson,  Chartered  Accountants  from June
1991 to July 1994.

NICK DE COTIIS  (Don De Cotiis'  brother)  Mr. De Cotiis is a Director of the De
--------------
Cotiis Group of Companies,  which  specialize in commercial and residential real
estate development and venture capital investment.  Mr. De Cotiis is currently a
director of the following public companies: First Castle Enterprises Inc., First
Harbour  Enterprises Inc., First Tower Enterprises Inc., Braiden Resources Ltd.,
Rocraven Resources Ltd.,  Fairhaven  Resources Ltd., Golden Trump Resources Ltd.
and  Silverstone  Resources Ltd. Mr. De Cotiis some experience in commercial and
residential real estate  development  including land  acquisition,  development,
design, building,  marketing and management of multi-family residential projects
and commercial projects.

CONRAD  CLEMISS Mr.  Clemiss has over 16 years of experience  in the  securities
---------------
industry.  Since  1995,  Mr.  Clemiss  has been a Director  and Officer of First
Goldwater  Resources Inc. He has been a director of Micron Enviro Systems,  Inc.
since May 28, 2002. Mr. Clemiss was formerly with Canaccord Capital  Corporation
and Yorkton  Securities  Inc. Mr.  Clemiss has knowledge  and  experience of the
workings of publicly  traded  companies,  specifically  in the areas of investor
relations and business development.

DON DE COTIIS  (Nick De Cotiis'  brother)  Mr. De Cotiis is a Director of the De
-------------
Cotiis Group of Companies,  which  specialize in commercial and residential real
estate development and venture capital investment.  Mr. De Cotiis is currently a
director of First Tower Enterprises  Inc., First Castle  Enterprises Inc., First
Harbour  Enterprises  Inc.,  Braiden  Resources Ltd.,  Rocraven  Resources Ltd.,
Fairhaven Resources Ltd., Golden Trump Resources Ltd., and Silverstone Resources
Ltd..  Mr. De Cotiis has some  experience in  commercial  and  residential  real
estate development including land acquisition,  development,  design,  building,
marketing and  management of  multi-family  residential  projects and commercial
projects.

NEGAR TOWFIGH runs her own consulting  firm where she specializes in structuring
-------------
companies from  incorporation to a listing on the TSX Venture Exchange or OTCBB;
she assists  companies with initial public  offerings and handles all regulatory
filings.  She is  currently a director of First  Goldwater  Resources  Inc.  and
Habanero  Resources Inc. She is also CFO and Secretary of Micron Enviro Systems,
Inc. She has previously  been employed in the  investment  industry with several
brokerage houses including  Canaccord Capital  Corporation,  Nesbitt Burns Inc.,
RBC Dominion and Pacific  International  Securities  Inc. She  graduated  with a
Bachelor of Commerce in Finance from the University of British Columbia in 1995.

Section 16(a) of the Exchange Act requires our directors, executive officers and
beneficial  holders  of more than 10% of our  Common  Stock to file with the SEC
initial  reports of ownership and reports of changes in ownership and reports of
changes in ownership of our equity securities. As of the date of this Report, we
believe that all reports required to be filed have been filed in a timely manner
for the year ended April 30, 2002, except as set forth below.

All of our  directors  and  officers  were  to file a Form 3 once  we  became  a
reporting issuer and they in turn became a reporting person by October 18, 2001.
As of the date of this Report none of our directors or officers had filed a Form
3. Nick De Cotiis and Don De Cotiis were  required to file a Form 5 each by June
14, 2002 stating their  beneficial  ownership for the year ended April 30, 2002.
To the best of our knowledge,  as of the date of this Report,  we do not believe
they have filed this form.

                                       12
<PAGE>




Item 10.  Executive Compensation.
---------------------------------

Summary Compensation Table
--------------------------

Any compensation received by our officers,  directors,  and management personnel
will be determined  from time to time by our Board of  Directors.  Our officers,
directors,  and management  personnel  will be reimbursed for any  out-of-pocket
expenses incurred on our behalf.

The following table sets forth certain  information  concerning  compensation of
certain of our executive officers, including our Chief Executive Officer and all
executive officers, or the Named Executives, whose total annual salary and bonus
exceeded $50,000, for the years ended April 30, 2002, 2001 and 2000:

<TABLE>
<CAPTION>
                           SUMMARY COMPENSATION TABLE

                                                                             Long Term Compensation
                                                                             ----------------------
                                      Annual Compensation                      Awards                Payouts
                                      -------------------                      ------                -------
Name and                                            Other Annual     Restricted       Securities       LTIP         All Other
Principle                                 Bonus     Compensation       Stock         Underlying       Payouts     Compensation
Position             Year    Salary ($)    ($)          ($)         Award(s) ($)   Options/SARs (#)     ($)             ($)
-----------------    ----    ----------   -----     ------------    ------------   ----------------   -------     ------------

<S>                  <C>      <C>          <C>           <C>             <C>              <C>           <C>           <C>
Allen                2002     $48,000      Nil           Nil             Nil              Nil           Nil           Nil
Sewell [1]
  President          2001     $12,000      Nil           Nil             Nil              Nil           Nil           Nil


Graeme               2001     $36,000      Nil           Nil             Nil              Nil           Nil           Nil
Sewell [2]
  President          2000     $48,000      Nil           Nil             Nil              Nil           Nil           Nil

[1]  Mr. Allen Sewell began serving as our President on February 1, 2001. During
     the period from February 1, 2001 to April 30, 2001,  Allen Sewell's  salary
     was paid to Church Bay Farms Corp.  Gayle Sewell (Allen  Sewell's  wife) is
     president and the sole director of Church Bay Farms Corp.

[2]  Mr. Graeme Sewell served as our President from inception  until February 1,
     2001.  During the period from February 1999 to January 31, 2001, his salary
     was paid by 463563 B.C. Limited, a company wholly-owned by Graeme Sewell.
</TABLE>

Limitation on Directors' Liabilities; Indemnification of Officers and Directors
-------------------------------------------------------------------------------

Our Articles of  Incorporation  and Bylaws  designate  the  relative  duties and
responsibilities of our officers,  establish procedures for actions by directors
and shareholders and other items. Our Articles of Incorporation  and Bylaws also
contain extensive indemnification provisions,  which will permit us to indemnify
our  officers  and  directors  to the  maximum  extent  provided  by Nevada law.
Pursuant to our Articles of  Incorporation  and under Nevada law, our  directors
and officers are generally not liable to us or our shareholders for damages as a
result of any act or failure  to act in his  capacity  as a director  or officer
unless it is proven  that:  (i) the act or  failure  to act of such  officer  or
director  constituted a breach of his fiduciary  duties;  and (ii) his breach of
those duties involve  intentional  misconduct,  fraud or a knowing  violation of
law.

We have adopted a form of indemnification agreement for all of our directors and
officers  with  the  exception  of  Don De  Cotiis,  who  did  not  execute  his
indemnification  agreement,  which  provides  the  indemnitee  with the  maximum
indemnification  allowed under  applicable  law.  Since the Nevada  statutes are
non-exclusive,  it is  possible  that  certain  claims  beyond  the scope of the
statute may be indemnifiable. The indemnification agreement provides a scheme of


                                       13
<PAGE>




indemnification,  which may be broader than that specifically provided by Nevada
law. It has not yet been determined, however, to what extent the indemnification
expressly  permitted by Nevada law may be expanded,  and  therefore the scope of
indemnification  provided  by the  indemnification  agreement  may be subject to
future judicial interpretation.

The  indemnification  agreement provides that we are to indemnify an indemnitee,
who is or was a party or becomes a party or is  threatened to be made a party to
any  threatened,  pending  or  completed  action or  proceeding  whether  civil,
criminal,  administrative  or  investigative  by  reason  of the  fact  that the
indemnitee is or was one of our directors, officers, key employees or agents. We
are to advance all  expenses,  judgments,  fines,  penalties and amounts paid in
settlement  incurred by the  indemnitee  in connection  with the  investigation,
defense,  settlement or appeal of any civil or criminal  action or proceeding as
described  above.  The  indemnitee is to repay such amounts  advanced only if it
shall be ultimately  determined that he or she is not entitled to be indemnified
by us.  Any  award  of  indemnification  to an  indemnitee,  if not  covered  by
insurance,   would  come   directly  from  our  assets,   thereby   affecting  a
shareholder's investment.

There is no pending  litigation  or  proceeding  involving an  indemnitee  where
indemnification  would  be  required  or  permitted  under  the  indemnification
agreements.


Item 11.  Security Ownership of Certain Beneficial Owners and Management.
-------------------------------------------------------------------------

The following table sets forth information regarding beneficial ownership of our
Common Stock as of July 16, 2002:

     o    each  shareholder who is known by us to own beneficially 5% or more of
          our Common Stock;
     o    each of our  directors  and  each of the  officers  named in Item 10 -
          "Directors  and Executive  officers of the  Registrant,"  or the Named
          Executives, of this Report; and
     o    all of our directors and executive officers as a group.

<TABLE>
<CAPTION>
=============================================================================================
Name and Address of Beneficial Owner           Amount and Nature of          Percent of Class
                                               Beneficial Ownership (1)
=============================================================================================
<S>                                             <C>                                <C>
Allen Sewell                                                        Nil               0%
101 Church Bay Road
Saturna Island, B.C.
Canada, V0N 2Y0

Don De Cotiis                                      1,500,000 Common (2)             6.5%
Suite 300 - 750 West Pender Street
Vancouver, B.C.
Canada, V6C 2T7

Graeme Sewell                                      1,100,000 Common (3)            4.77%
5501 Cliffridge Place
North Vancouver, B.C.
Canada, V7R 4S2

Nick De Cotiis                                  2,500,000 Common (3)(4)            10.8%
Suite  300 - 750 West Pender Street
Vancouver, B.C.
Canada, V6C 2CT7

Conrad Clemiss                                                      Nil               0%
4905 Chalet Place
North Vancouver, B.C.
Canada, V7R 4X4

Negar Towfigh                                                       Nil               0%
1403 Chippendale Road
West Vancouver, B.C.
Canada, V7S 2N7

                                       14
<PAGE>




Mark Zwanski                                           1,300,000 Common             5.6%
3005 St. Marys Avenue
North Vancouver, B.C.
Canada, V7N 1X5

Directors and Officers as a Group (six persons)        5,100,000 Common            22.1%
=============================================================================================

     (1)  Unless otherwise  indicated,  this column reflects amounts as to which
          the beneficial owner has sole voting power and sole investment power.

     (2)  Beneficially  owns 1,000,000  common shares  registered in the name of
          Lori Anne De Cotiis,  250,000 common shares  registered in the name of
          Dorothy De Cotiis and 250,000 common shares  registered in the name of
          Marianne De Cotiis.

     (3)  Graeme Sewell and Nick De Cotiis own 1,000,000 founder's shares each.

     (4)  Beneficially  owns 1,500,000  common shares  registered in the name of
          Teresa De Cotiis.
</TABLE>

     Beneficial  ownership is determined in accordance with the rules of the SEC
     and  generally   includes  voting  or  investment  power  with  respect  to
     securities.


Item 12.  Certain Relationships and Related Transactions.
---------------------------------------------------------

We have  entered  into an  Option  Agreement  with  Brothers,  a  company  whose
president  is Allen  Sewell,  whereby  Brothers  granted to us an option to earn
approximately 13% of two gas wells in California. As of the date of this Report,
payments of $45,000 have been made to Brothers in consideration  for the Option.
Several members of the Sewell family control Brothers. The directors of Brothers
are Allen Sewell and Michael Sewell,  who is Allen Sewell's son. Allen Sewell is
our president  and one of our  directors.  As such,  our execution of the Option
Agreement   with   Brothers  was  not  an  arm's  length   transaction   with  a
non-affiliate.  While Allen  Sewell has a fiduciary  duty to deal fairly with us
and our  shareholders,  there is no guarantee that the terms of the  transaction
were similar to what we would have received in an arms' length  transaction with
a non-affiliate.


                                     PART IV


Item 13.  Exhibits and Reports on Form 8-K.
-------------------------------------------

     A.   Financial Statements
          --------------------

               The balance  sheets and the  related  statements  of  operations,
               shareholders'  equity and cash flows of  Herrimen  Oil & Gas Inc.
               for each of the years ended April 30, 2002 and 2001.

     B.   Reports on Form 8-K
          -------------------

               We did not file  any  Current  Reports  on Form  8-K  during  the
               quarterly period ended April 30, 2002.

     C.   Other Exhibits
          --------------

               Exhibit 2.(i) Articles of Incorporation. (1)

               Exhibit 2.(ii) By-Laws. (1)



                                       15
<PAGE>




               Exhibit 10.1     Oil, Gas, and Mineral Lease (the "Enron  Lease")
               between Enron Oil & Gas Company and Vaughan Production Co., dated
               March 28, 1997. (1)

               Exhibit 10.2     Farmout  Agreement (the "Farmout")  between  Elk
               Slough Partners  ("Farmee"),  and Vaughan Production Co., Vaughan
               Exploration, Inc. Production Specialties Co., Sunset Exploration,
               Inc. and Brothers Oil & Gas, Inc. (collectively, "Farmor"), dated
               September 15, 1997. (1)

               Exhibit 10.3     Model Form Operating Agreement (the "JOA") dated
               September   29,   1997   between   the   Company  and  others  as
               non-operators and Production Specialties Co. as operator. (1)

               Exhibit 10.4     Participation Agreement (the  "Pasco Agreement")
               between Elk Slough  Partners and Pasco Pacific  Management  Corp.
               dated November 3, 1997. (1)

               Exhibit 10.5     Participation Agreement between  First Goldwater
               Resources  Inc.  and Elk Slough  Partners  and Brothers Oil & Gas
               Inc. dated March 20, 1998. (1)

               Exhibit 10.6     Amendment  to  Participation  Agreement  between
               First  Goldwater  Resources  Inc.  and Elk  Slough  Partners  and
               Brothers Oil & Gas Inc. dated June 23, 1998. (1)

               Exhibit 10.7     Option   Agreement   (the  "Option   Agreement")
               between  Brothers Oil & Gas, Inc. and the Company dated  November
               27, 1998. (1)

               Exhibit 10.8     Option Extension Letter  from Brothers Oil & Gas
               Inc. to the Company dated June 18, 1999. (1)

               Exhibit 10.9     Second Option Extension Letter from Brothers Oil
               & Gas Inc. to the Company dated June 18, 2000. (1)

               Exhibit 10.10   Indemnification Agreement with Allen Sewell.(1)

               Exhibit 10.11   Indemnification Agreement with Graeme Sewell.(1)

               Exhibit 10.12   Indemnification Agreement with Conrad Clemiss.(1)

               Exhibit 10.13   Indemnification Agreement with Nick De Cotiis.(1)

               Exhibit 10.14   Indemnification Agreement with Negar Towfigh.(1)

               Exhibit 10.15    Option Extension Letter from  Brothers Oil & Gas
               Inc. to the Company dated December 31, 2001.

               Exhibit 10.16    Option Extension Letter from  Brothers Oil & Gas
               Inc. to the Company dated June 25, 2002.

               Additional  Exhibits:  (Only the text portions of these documents
               were attached to our Form 10-SB as exhibits. The full reports can
               be obtained from our offices.)

               -  Geological  Overview  of the  Pioneer  Canal  Prospect,  dated
               February 16, 1998, by Jeffrey K. Vaughan.(1)
               - Geological  Report of the Pioneer Canal  Prospect,  dated March
               11, 1998, by Jeffrey K. Vaughan. (1)

                                       16
<PAGE>




               - Geological Overview of the Pioneer Canal #18R-3,  dated July 8,
               1999, by Jeffrey K. Vaughan. (1)
               - Geological  Overview of the Pioneer Canal #61-9, dated June 23,
               1999, by Jeffrey K. Vaughan. (1)
               -  Geological  Report  on the  Pioneer  Canal - Pulv  and  Olcese
               Prospects,  dated  February 17, 1998,  by Jeffrey K. Vaughan with
               David Olson's Independent Review of the Report attached. (1)

(1)  Incorporated by reference from our report on Form 10-KSB filed on August 9,
     2001.


                       DOCUMENTS INCORPORATED BY REFERENCE

We  are  currently  subject  to the  reporting  requirements  of the  Securities
Exchange  Act of  1934,  as  amended  (the  "Exchange  Act")  and in  accordance
therewith files reports,  proxy  statements and other  information with the SEC.
Such reports, proxy statements and other information may be inspected and copied
at the public  reference  facilities  of the SEC at Judiciary  Plaza,  450 Fifth
Street,  N.W.,  Washington  D.C.  20549;  at its New York Regional  Office,  233
Broadway, New York, NY 10279; and at its Chicago Regional Office, 175 W. Jackson
Boulevard,  Suite 900,  Chicago,  IL 60604,  and copies of such materials can be
obtained from the Public Reference Section of the SEC at its principal office in
Washington,  D.C.,  at  prescribed  rates.  In addition,  such  materials may be
accessed  electronically at the Commission's site on the World Wide Web, located
at http://www.sec.gov. We intend to furnish our shareholders with annual reports
   ------------------
containing  audited  financial  statements and such other periodic reports as we
may determine to be appropriate or as may be required by law.






















                                       17
<PAGE>






SIGNATURES

     In accordance  with Section 13 or 15(d) of the  Securities  Exchange Act of
1934,  the  registrant  has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                                 HERRIMEN OIL & GAS INC.


     Dated:  July 30, 2002                       By:  /s/ Allen Sewell
                                                     ---------------------------
                                                     Allen Sewell
                                                     President and Director



                                   SIGNATURES

     In accordance  with the  Securities  Exchange Act of 1934,  this report has
been signed below by the following  persons on behalf of the  registrant  and in
the capacities and on the dates indicated below.



                                                 HERRIMEN OIL & GAS INC.


     Dated:  July 30, 2002                       By:  /s/ Allen Sewell
                                                     ---------------------------
                                                     Allen Sewell
                                                     President and Director


     Dated:  July 30, 2002                       By:  /s/ Graeme Sewell
                                                     ---------------------------
                                                     Graeme Sewell
                                                     Vice President and Director


     Dated: July 30, 2002                        By:  /s/ Conrad Clemiss
                                                     ---------------------------
                                                     Conrad Clemiss
                                                     Director











                                       18
<PAGE>























                             HERRIMEN OIL & GAS INC.

                         (An Exploration Stage Company)

                         REPORT AND FINANCIAL STATEMENTS

                             April 30, 2002 and 2001

                             (Stated in US Dollars)
                              --------------------




























                                       F-1
<PAGE>



TERRY AMISANO LTD.                                  A M I S A N O    H A N S O N

KEVIN HANSON, C.A.                                         CHARTERED ACCOUNTANTS






                          INDEPENDENT AUDITORS' REPORT


To the Stockholders,
Herrimen Oil & Gas Inc.

We have audited the  accompanying  balance sheets of Herrimen Oil & Gas Inc. (An
Exploration  Stage  Company)  as of April  30,  2002  and  2001 and the  related
statements of operations,  cash flows and stockholders'  equity (deficiency) for
the years ended April 30, 2002,  2001 and 2000 and the period from  November 24,
1998 (Date of  Inception  of the  Exploration  Stage) to April 30,  2002.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform an audit to obtain reasonable assurance whether the financial statements
are free of material misstatement.  An audit includes examining on a test basis,
evidence supporting the amounts and disclosures in the financial statements.  An
audit also includes  assessing the accounting  principles  used and  significant
estimates  made by  management,  as well as  evaluating  the  overall  financial
statement  presentation.  We believe that our audit provides a reasonable  basis
for our opinion.

In our opinion,  these  financial  statements  present  fairly,  in all material
respects, the financial position of Herrimen Oil & Gas Inc. as of April 30, 2002
and 2001 and the  results  of its  operations  and its cash  flows for the years
ended April 30, 2002,  2001 and 2000 and the period from November 24, 1998 (Date
of Inception of the  Exploration  Stage) to April 30, 2002, in  conformity  with
accounting principles generally accepted in the United States of America.

The  accompanying  financial  statements  referred  to above have been  prepared
assuming that the Company will continue as a going concern. As discussed in Note
1 to the financial statements,  the Company is in the exploration stage, and has
no  established  source of  revenue  and is  dependent  on its  ability to raise
capital from shareholders or other sources to sustain operations. These factors,
along with other  matters as set forth in Note 1, raise  substantial  doubt that
the  Company  will  be able  to  continue  as a  going  concern.  The  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.


Vancouver, Canada                                          /s/ AMISANO HANSON
June 17, 2002                                              Chartered Accountants






750 WEST PENDER STREET, SUITE 604                      TELEPHONE:  604-689-0188
VANCOUVER CANADA                                       FACSIMILE:  604-689-9773
V6C 2T7                                                E-MAIL:     amishan@telus

                                       F-2
<PAGE>




<TABLE>
<CAPTION>
                             HERRIMEN OIL & GAS INC.
                         (An Exploration Stage Company)
                                 BALANCE SHEETS
                             April 30, 2002 and 2001
                             (Stated in US Dollars)
                              --------------------


                                     ASSETS               2002                 2001
                                     ------               ----                 ----
<S>                                                 <C>                  <C>
Current
   Cash                                             $              -     $         2,367

Capital assets - Notes 3 and 7                                     -               7,968
                                                    -----------------    ----------------
                                                    $              -     $        10,335
                                                    =================    ================

                                   LIABILITIES
                                   -----------
Current
   Bank overdraft                                   $              6     $             -
   Accounts payable - Note 7                                 150,303              86,844
   Advances payable - Notes 5 and 7                           34,016              30,000
                                                    -----------------    ----------------
                                                             184,325             116,844
                                                    -----------------    ----------------

                            STOCKHOLDERS' DEFICIENCY
                            ------------------------
Capital stock - Note 6
Common stock, $0.001 par value
   50,000,000 authorized
   23,052,610 outstanding                                     23,052              23,052
Paid-in capital                                              264,804             264,804
Deficit accumulated during the exploration stage            (472,181)           (394,365)
                                                    -----------------    ----------------
                                                            (184,325)           (106,509)
                                                    -----------------    ----------------
                                                    $              -     $        10,335
                                                    =================    ================
</TABLE>
Nature and Continuance of Operations - Note 1
Subsequent Event - Note 4

APPROVED BY THE DIRECTORS:


/s/ Allen Sewell          , Director      /s/ Graeme Sewell         , Director
--------------------------                --------------------------



                             SEE ACCOMPANYING NOTES

                                       F-3
<PAGE>




<TABLE>
<CAPTION>
                             HERRIMEN OIL & GAS INC.
                         (An Exploration Stage Company)
                            STATEMENTS OF OPERATIONS
                  for the years ended April 30, 2002, 2001 and
               2000 and the period from November 24, 1998 (Date of
                Inception of Exploration Stage) to April 30, 2002
                             (Stated in US Dollars)
                              --------------------

                                                                                                November 24,
                                                                                               1998 (Date of
                                                                                               Inception of
                                                                                              the Exploration
                                                                                                  Stage) to
                                                                                                  April 30,
                                              2002              2001              2000              2002
                                              ----              ----              ----              ----
<S>                                     <C>               <C>               <C>               <C>
General and Administrative Expenses
   Administration fees - Note 7         $             -   $             -   $         7,027   $        14,527
   Amortization                                   1,195             1,406             1,654             4,990
   Audit and accounting                          10,670             3,000             6,738            22,408
   Consulting fees - Note 7                       3,875                 -                 -             5,875
   Cost recovery - Note 7                             -                 -            (4,000)           (4,000)
   Filing fees                                    2,414               150             4,075             6,639
   Legal fees                                       230             4,991            17,205            45,549
   Management fees - Note 7                      48,000            48,000            48,000           168,000
   Office and miscellaneous                       2,412               881             2,046            11,343
   Promotion                                          -                 -            11,770            35,953
   Rent - Note 7                                      -                 -             1,432             1,432
   Telephone                                          -                 -             1,282             3,050
   Transfer agent                                 2,247             1,543             3,099             7,639
   Travel and auto                                    -                 -             8,157            23,466
                                        ----------------  ----------------  ----------------  ----------------

Loss before the following                       (71,043)          (59,971)         (108,485)         (346,871)
   Abandonment of capital assets                 (6,773)                -                 -            (6,773)
   Exploration and development
    expenses                                          -                 -           (26,537)          (34,037)
   Write off oil and gas properties
    - Note 7                                          -           (14,500)                -           (84,500)
                                        ----------------  ----------------  ----------------  ----------------

Net loss for the period                 $       (77,816)  $       (74,471)  $      (135,022)  $      (472,181)
                                        ================  ================  ================  ================

Basic loss per share                    $         (0.00)  $         (0.00)  $         (0.01)
                                        ================  ================  ================
Weighted average number of shares
outstanding                                  23,052,610        22,802,610        19,662,610
                                        ================  ================  ================
</TABLE>




                             SEE ACCOMPANYING NOTES

                                       F-4
<PAGE>




<TABLE>
<CAPTION>
                             HERRIMEN OIL & GAS INC.
                         (An Exploration Stage Company)
                            STATEMENTS OF CASH FLOWS
                  for the years ended April 30, 2002, 2001 and
               2000 and the period from November 24, 1998 (Date of
                Inception of Exploration Stage) to April 30, 2002
                             (Stated in US Dollars)
                              --------------------

                                                                                                     November 24,
                                                                                                    1998 (Date of
                                                                                                     Inception of
                                                                                                   the Exploration
                                                                                                        Stage) to
                                                                                                        April 30,
                                                   2002              2001              2000              2002
                                                   ----              ----              ----              ----
<S>                                          <C>               <C>               <C>               <C>
Cash Flows used in Operating Activities
   Net loss for the period                   $       (77,816)  $       (74,471)  $      (135,022)  $      (472,181)
   Add: items not affecting cash
     Abandonment of capital assets                     6,773                 -                 -             6,773
     Amortization                                      1,195             1,406             1,654             4,990
     Write off of oil and gas properties                   -            14,500                 -            84,500
   Changes in non-cash working capital
   balances:
     Prepaid expenses                                      -                 -             1,432                 -
     Accounts payable                                 63,459            52,182            22,090           150,303
     Advances payable                                  4,016                 -            30,000            34,016
                                             ----------------  ----------------  ----------------  ----------------
Net cash used in operating activities                 (2,373)           (6,383)          (79,846)         (191,599)
                                             ----------------  ----------------  ----------------  ----------------
Cash Flows from Financing Activities
   Common stock issued                                     -                 -            (3,125)          224,656
   Common stock subscriptions                              -             5,000            41,325            63,200
                                             ----------------  ----------------  ----------------  ----------------
Net cash from financing activities                         -             5,000            38,200           287,856
                                             ----------------  ----------------  ----------------  ----------------
Cash Flows from (used in) Investing
 Activities
   Acquisition of capital assets                           -                 -                 -           (11,763)
   Acquisition of oil and gas properties                   -                 -            (2,500)          (86,500)
   Proceeds on disposal of oil and gas
    property                                               -             2,000                 -             2,000
                                             ----------------  ----------------  ----------------  ----------------
Net cash from (used in) investing
 activities                                                -             2,000            (2,500)          (96,263)
                                             ----------------  ----------------  ----------------  ----------------
Net increase (decrease) in cash during
  the period                                          (2,373)              617           (44,146)               (6)

Cash, beginning of the period                          2,367             1,750            45,896                 -
                                             ----------------  ----------------  ----------------  ----------------
Cash (bank overdraft), end of the period     $            (6)  $         2,367   $         1,750   $            (6)
                                             ================  ================  ================  ================
                                                                                                        .../Cont'd.

                             SEE ACCOMPANYING NOTES

                                       F-5
<PAGE>




<CAPTION>
                             HERRIMEN OIL & GAS INC.                   Continued
                         (An Exploration Stage Company)
                            STATEMENTS OF CASH FLOWS
                  for the years ended April 30, 2002, 2001 and
               2000 and the period from November 24, 1998 (Date of
                Inception of Exploration Stage) to April 30, 2002
                             (Stated in US Dollars)
                              --------------------

                                                                                                     November 24,
                                                                                                    1998 (Date of
                                                                                                     Inception of
                                                                                                   the Exploration
                                                                                                        Stage) to
                                                                                                        April 30,
                                                   2002              2001              2000              2002
                                                   ----              ----              ----              ----
<S>                                          <C>               <C>               <C>               <C>
Supplemental disclosure of cash flow
information:
 Cash paid for:
   Interest                                  $             -   $             -  $              -   $             -
                                              ================  ================  ================  ================

   Income taxes                              $             -   $             -  $              -   $             -
                                             ================  ================  ================  ================
</TABLE>































                             SEE ACCOMPANYING NOTES

                                       F-6
<PAGE>




<TABLE>
<CAPTION>
                             HERRIMEN OIL & GAS INC.
                         (An Exploration Stage Company)
                 STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIENCY)
               for the period November 24, 1998 (Date of Inception
                            of Exploration Stage) to
                                 April 30, 2002
                             (Stated in US Dollars)
                              --------------------

                                                                                                 Deficit
                                                                                               Accumulated
                                                      Common Shares            Additional       During the
                                             -------------------------------     Paid-in       Exploration
                                                 Number         Par Value        Capital          Stage            Total
                                                 ------         ---------        -------          -----            -----

<S>                                              <C>         <C>              <C>             <C>             <C>
Stock issued pursuant to private
 placement agreements       - at $0.001           2,000,000  $        2,000   $           -   $           -   $        2,000
                            - at $0.015          13,274,277          13,274         185,840               -          199,114
                            - at $0.02              333,333             333           6,334               -            6,667
                            - at $0.50               40,000              40          19,960               -           20,000
                            - at $0.015           1,125,000           1,125          15,750               -           16,875
                                             --------------  ---------------  -------------   -------------   ---------------
                                                 16,772,610          16,772         227,884               -          244,656
Net loss for the period                                   -               -               -        (184,872)        (184,872)
                                             --------------  ---------------  -------------   -------------   ---------------
Balance, April 30, 1999                          16,772,610          16,772         227,884        (184,872)          59,784

Stock rescission            - at $0.50              (40,000)            (40)        (19,960)              -          (20,000)
Stock subscriptions         - at $0.01            5,820,000           5,820          52,380               -           58,200
Net loss for the year                                     -               -               -        (135,022)        (135,022)
                                             --------------  ---------------  -------------   -------------   ---------------
Balance, April 30, 2000                          22,552,610          22,552         260,304        (319,894)         (37,038)

Stock subscriptions         - at $0.01              500,000             500           4,500               -            5,000
Net loss for the year                                     -               -               -         (74,471)         (74,471)
                                             --------------  ---------------  -------------   -------------   ---------------
Balance, April 30, 2001                          23,052,610          23,052         264,804        (394,365)        (106,509)
Net loss for the year                                     -               -               -         (77,816)         (77,816)
                                             --------------  ---------------  -------------   -------------   ---------------
Balance, April 30, 2002                          23,052,610  $       23,052   $     264,804   $    (472,181)  $     (184,325)
                                             ==============  ===============  =============   =============   ===============
</TABLE>












                             SEE ACCOMPANYING NOTES

                                       F-7
<PAGE>




                             HERRIMEN OIL & GAS INC.
                         (An Exploration Stage Company)
                        NOTES TO THE FINANCIAL STATEMENTS
                             April 30, 2002 and 2001
                             (Stated in US Dollars)
                              --------------------


Note 1    Nature and Continuance of Operations
          ------------------------------------

          The Company is an exploration  stage company.  The Company  intends to
          explore and develop oil and gas properties in California,  USA. During
          the 2002 and 2001 fiscal  years,  the Company  has not  conducted  any
          exploration  and  development.  The  Company  has not  yet  determined
          whether  these  properties  contain  reserves  that  are  economically
          recoverable.  The  recoverability of the amounts shown for oil and gas
          properties is dependent upon the discovery of economically recoverable
          reserves,  confirmation  of the Company's  interest in the  underlying
          properties,  the  ability  of the  Company  to  obtain  the  necessary
          financing  to  satisfy  the   expenditure   requirements  of  property
          agreements and complete the  development of the  properties,  and upon
          future profitable production or proceeds from the sale thereof.

          These  financial  statements  have been  prepared  on a going  concern
          basis. The Company has a working capital  deficiency of $184,325 as of
          April  30,  2002 and has  accumulated  a  deficit  of  $472,181  since
          inception.  Its ability to continue  as a going  concern is  dependent
          upon the ability of the Company to generate  profitable  operations in
          the  future  and/or  to obtain  the  necessary  financing  to meet its
          obligations  and repay its  liabilities  arising from normal  business
          operations  when they come due. The outcome of these matters cannot be
          predicted   with  any   certainty  at  this  time.   The  Company  has
          historically  satisfied its capital needs  primarily by issuing equity
          securities.  Management  plans to  continue to provide for its capital
          needs  during the year ended April 30, 2002 by the  issuance of common
          stock.  These  financial  statements do not include any adjustments to
          the amounts and  classification  of assets and liabilities that may be
          necessary should the Company be unable to continue as a going concern.

          The Company was  incorporated in Nevada,  USA on November 24, 1998, as
          Herrimen Oil & Gas Inc. and commenced operations at that time.


Note 2    Summary of Significant Accounting Policies
          ------------------------------------------

          The  financial  statements  of  the  Company  have  been  prepared  in
          conformity with accounting principles generally accepted in the United
          States of America.  Because a precise determination of many assets and
          liabilities  is  dependent  upon future  events,  the  preparation  of
          financial  statements  for a period  necessarily  involves  the use of
          estimates which have been made using careful judgement. Actual results
          may vary from these estimates.

          The financial statements have, in management's  opinion, been properly
          prepared  within  reasonable  limits of  materiality  and  within  the
          framework of the significant accounting policies summarized below:



                                       F-8
<PAGE>




Herrimen Oil & Gas Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
April 30, 2002 and 2001
(Stated in US Dollars) - Page 2
 --------------------


Note 2    Summary of Significant Accounting Policies - (cont'd)
          ------------------------------------------

          Exploration Stage Company

          The Company is an exploration stage company as defined in Statement of
          Financial  Accounting  Standards  No. 7  "Accounting  and Reporting by
          Development Stage Enterprises".  The Company is devoting substantially
          all  of its  present  efforts  to  the  business  of  exploration  and
          development  of oil and  gas  properties  in  California.  All  losses
          accumulated  since  incorporation  have been considered as part of the
          Company's exploration stage activities.

          Capital Assets and Amortization
          -------------------------------

          The Company  records office  equipment  additions at cost and provides
          for  amortization  at a rate  of 15% per  annum  using  the  declining
          balance method.

          Impairment of Long-lived Assets
          -------------------------------

          The Company  reports the  impairment of long-lived  assets and certain
          identifiable  intangibles  in accordance  with  Statement of Financial
          Accounting  Standards  No.  121  "Accounting  for  the  Impairment  of
          Long-lived  Assets  and for  Long-lived  Assets  to be  Disposed  Of".
          Certain  long-lived  assets and  identifiable  intangibles held by the
          Company are  reviewed  for  impairment  whenever  assets or changes in
          circumstances  indicate  the  carrying  amount  of an asset may not be
          recoverable.  Accordingly,  an  impairment  loss is  recognized in the
          period it is determined.

          Oil and Gas Project Costs
          -------------------------

          The Company uses the  successful  efforts method of accounting for oil
          and gas  activities.  All costs  associated  with the  acquisition of,
          exploration   for  and   development  of  oil  and  gas  reserves  are
          capitalized.  Costs of  exploratory  wells that do not find proved and
          economically   recoverable   reserves   including   costs  of  related
          geological and geophysical  studies and costs of carrying the retained
          property are expensed.

          Unproved oil and gas properties that are individually  significant are
          periodically   assessed  for  impairment  of  value,  and  a  loss  is
          recognized  at the  time of  impairment  by  providing  an  impairment
          allowance.  Other  unproved  properties  are  amortized  based  on the
          Company's  experience  of  successful  drilling  and  average  holding
          period.   Capitalized  assets  of  producing   properties,   including
          provision  for  estimated  abandonment  costs and  salvage  values are
          amortized  using the  unit-of-production  method.  Other tangible well
          equipment is amortized over their estimated useful lives.







                                       F-9
<PAGE>




Herrimen Oil & Gas Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
April 30, 2002 and 2001
(Stated in US Dollars) - Page 3
 --------------------


Note 2    Summary of Significant Accounting Policies - (cont'd)
          ------------------------------------------

          Environmental Costs
          -------------------

          Environmental  expenditures  that  relate to  current  operations  are
          expensed or capitalized as appropriate. Expenditures that relate to an
          existing  condition  caused  by  past  operations,  and  which  do not
          contribute  to current or future  revenue  generation,  are  expensed.
          Liabilities  are  recorded  when   environmental   assessments  and/or
          remedial  efforts  are  probable,  and  the  cost  can  be  reasonably
          estimated.  Generally, the timing of these accruals coincides with the
          earlier of:

          i)   completion of a feasibility study: or

          ii)  the Company's  commitments  to a plan of action based on the then
               known facts.

          Values
          ------

          The amounts  shown for oil and gas project  costs  represent  costs to
          date and to not necessarily reflect present or future values.

          Foreign Currency Translation
          ----------------------------

          Foreign  currency  transactions  are translated  into US dollars,  the
          functional and reporting currency,  by the use of the exchange rate in
          effect at the date of the  transaction in accordance with Statement of
          Financial Accounting Standards No. 52 "Foreign Currency  Translation".
          At each balance sheet date,  recorded balances that are denominated in
          a currency  other than US dollars are  adjusted to reflect the current
          exchange rate.

          Basic Loss Per Share
          --------------------

          The Company  reports basic loss per share in accordance with Statement
          of Financial  Accounting Standards No. 128 "Earnings per Share". Basic
          loss per share is computed using the weighted average number of shares
          outstanding during the period.

          Income Taxes
          ------------

          The Company  uses the asset and  liability  method of  accounting  for
          income taxes in  accordance  with  Statement  of Financial  Accounting
          Standards No. 109 "Accounting for Income Taxes".

          Financial Instruments
          ---------------------

          The carrying value of the Company's financial instruments,  consisting
          of accounts payable, advances payable and bank overdraft,  approximate
          their fair value due to the short-term  maturity of such  instruments.
          Unless otherwise noted, it is management's opinion that the Company is
          not exposed to significant interest,  currency or credit risks arising
          from these financial instruments.


                                      F-10
<PAGE>




Herrimen Oil & Gas Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
April 30, 2002 and 2001
(Stated in US Dollars) - Page 4
 --------------------


Note 3    Capital Assets - Note 6
          --------------

<TABLE>
<CAPTION>
                                                 2002                            2001
                               -----------------------------------------   ----------------
                                              Accumulated
                                   Cost      Amortization       Net              Net
                                   ----      ------------       ---              ---
<S>                            <C>           <C>           <C>             <C>
          Office equipment     $         -   $         -   $          -    $         7,968

                               ============  ============  =============   ================
</TABLE>


Note 4    Commitments
          -----------

          i)   Midway Oil and Gas Lease

               On January 1, 2001,  the Company  abandoned  its  interest in the
               Midway Oil and Gas Lease and  received  a refund of  $2,000.  The
               remaining  balance of the acquisition costs totalling $14,500 was
               written-off during the year ended April 30, 2001.

          ii)  Pioneer Canal Project

               By an option  agreement dated November 27, 1998, the Company paid
               $45,000 to a company with a common  director for an option on two
               wells in the Pioneer Canal Project  located in Kern County in the
               State of California, USA. In addition, the Company paid a $25,000
               finder's fee with respect to this option.

               The  exercise  price of the  option is  $750,000,  and the option
               period ends December 31, 2001.  If  exercised,  the Company would
               earn  a  12%  and  a 13%  working  interest  in  the  two  wells,
               respectively.  In a prior year, the Company  recorded a write-off
               of $84,500 in respect to this project.

               By letters dated December 31, 2001 and June 25, 2002, the term of
               the option agreement has been extended on a month-to-month  basis
               until terminated in writing with thirty days notice.


Note 5    Advances Payable - Note 7
          ----------------

                                                        2002           2001
                                                        ----           ----

               Advances from related parties        $    19,016    $    15,000
               Share subscriptions                       15,000         15,000
                                                    ------------   ------------
                                                    $    34,016    $    30,000
                                                    ============   ============

          These amounts are unsecured, non-interest bearing and have no specific
          terms for repayment.

                                      F-11
<PAGE>




Herrimen Oil & Gas Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
April 30, 2002 and 2001
(Stated in US Dollars) - Page 5
 --------------------


Note 5    Advances Payable - Note 7 - (cont'd)
          ----------------

          Pursuant to a share  subscription  agreement dated September 16, 1999,
          the company received a cash advance of $15,000 and has agreed to issue
          1,000,000 common shares at $0.015 per share.


Note 6    Capital Stock - Note 5
          -------------

          Subscriptions:

          At April 30,  2001,  the  Company  had  received a total of $63,200 as
          share  subscriptions  for  6,320,000  common shares at $0.01 per share
          pursuant to private  placement  agreements.  These  shares were issued
          during the year ended April 30, 2002.


Note 7    Related Party Transactions - Note 4
          --------------------------

          The  Company was charged the  following  amounts by  directors  of the
          Company or companies with directors or officers in common:

<TABLE>
<CAPTION>
                                                                                               November 24,
                                                                                                1998 (Date
                                                                                               of Inception
                                                                                              of Exploration
                                                                                                Stage) to
                                                                                                April 30,
                                             2002              2001              2000              2002
                                             ----              ----              ----              ----
<S>                                    <C>               <C>               <C>               <C>
          Administration fees          $             -   $             -   $         7,027   $        14,527
          Cost recovery                              -                 -            (4,000)           (4,000)
          Capital assets                             -                 -                 -             3,547
          Consulting fees                        3,875                 -                 -             5,875
          Management fees                       48,000            48,000            48,000           168,000
          Write-off of oil and gas
           properties                                -                 -                 -            45,000
          Rent                                       -                 -             1,432             1,432
                                       ----------------  ----------------  ----------------  ----------------
                                       $        51,875   $        48,000   $        52,459   $       234,381
                                       ================  ================  ================  ================
</TABLE>

          The charges were  measured by the exchange  amount which is the amount
          agreed upon by the transacting parties and are on terms and conditions
          similar to non-related entities.




                                      F-12
<PAGE>




Herrimen Oil & Gas Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
April 30, 2002 and 2001
(Stated in US Dollars) - Page 6
 --------------------


Note 7    Related Party Transactions - Note 4
          --------------------------

          At April 30, 2002 and 2001, the Company owed the following  amounts to
          directors of the Company or companies with directors in common:

                                                 2002              2001
                                                 ----              ----
                Accounts payable            $     112,234     $      60,205
                Advances payable                   19,016            15,000
                                            --------------    --------------
                                            $     131,250     $      75,205
                                            ==============    ==============

          These amounts are unsecured, non-interest bearing and have no specific
          terms for repayment.


Note 8    Deferred Tax Assets
          -------------------

          The  Financial  Accounting  Standards  Board issued  Statement No. 109
          "Accounting  for Income  Taxes"  ("FAS  109") which is  effective  for
          fiscal years  beginning  after December 15, 1992. FAS 109 requires the
          use of the asset and liability  method of accounting for income taxes.
          Under the asset and liability  method of FAS 109,  deferred tax assets
          and  liabilities  are  recognized  for  the  future  tax  consequences
          attributable to temporary differences between the financial statements
          carrying   amounts  of  existing   assets  and  liabilities  and  loss
          carryforwards and their respective tax bases.  Deferred tax assets and
          liabilities  are measured using enacted tax rates expected to apply to
          taxable income in the years in which those  temporary  differences are
          expected to be recovered or settled.

          The  following  table  summarizes  the  significant  components of the
          Company's deferred tax assets:

                                                                 Total
                                                                 -----
          Deferred Tax Assets
            Non-capital loss carryforwards                   $    460,418
                                                             =============
          Deferred tax assets                                $    156,542
          Valuation allowance for deferred tax assets            (156,542)
                                                             -------------
                                                             $          -
                                                             =============

          The amount  taken into income as deferred tax assets must reflect that
          portion  of the income  tax loss  carryforwards  which is likely to be
          realized from future operations.  The Company has chosen to provide an
          allowance of 100% against all available income tax loss carryforwards,
          regardless of their time of expiry.



                                      F-13
<PAGE>




Herrimen Oil & Gas Inc.
(An Exploration Stage Company)
Notes to the Financial Statements
April 30, 2002 and 2001
(Stated in US Dollars) - Page 7
 --------------------


Note 9    Income Taxes
          ------------

          No  provision  for income taxes has been  provided in these  financial
          statements due to the net loss. At April 30, 2002, the Company has net
          operating  loss   carryforwards,   which  expire  commencing  in  2019
          totalling  approximately  $460,000,  the benefit of which has not been
          recorded in the financial statements.


Note 10   New Accounting Standards
          ------------------------

          Management  does not believe  that any  recently  issued,  but not yet
          effective  accounting  standards  if  currently  adopted  could have a
          material effect on the accompanying financial statements.




























                                      F-14