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

                                    FORM 20-F

      REGISTRATION  STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES
      EXCHANGE ACT OF 1934
                                       OR
  X   ANNUAL REPORT PURSUANT  TO  SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934
      For the calendar year ended December 31, 2000
                                       OR
      TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR  15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      For the transition period from _________________ to ________________

                         Commission file number 0-28794

                          CityView Corporation Limited
             (Exact name of Registrant as specified in its charter)

                          Western Australia, Australia
                 (Jurisdiction of incorporation or organization)
               63 Burswood Road, Burswood, Western Australia 6100
                    (Address of principal executive offices)


Securities registered or to be registered pursuant to Section 12(b) of the Act.

         Title of each class           Name of each exchange on which registered
                 NONE                                   N/A

 Securities registered or to be registered pursuant to Section 12(g) of the Act.
                                 Ordinary Shares
                                (Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d)
of the Act.
                                      NONE
                                (Title of Class)

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report.
               47,064,516 ordinary shares as at December 31, 2000

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
   X Yes     No
Indicate by check mark which financial statement item the registrant has elected
to follow.
   X Item 17       Item 18

(APPLICABLE  ONLY  TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST
 FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
     Yes     No       Not applicable
<PAGE>


                                     PART I


ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS.


Providing  information  called for in Item 1 is not  required  for filing a Form
20-F as an Annual  Report under the Exchange Act.  Nevertheless,  the Company is
providing its "Corporate  Directory" as it appeared in the Annual Report for the
year ended December 31, 2000 as filed with Australian Stock Exchange Limited.

CORPORATE DIRECTORY

Directors

Peter Mark Smyth
Peter John Augustin Remta
Leslie Robert Maurice Friday

Registered Office

63 Burswood Road,
Burswood  Western Australia    6100

Telephone:        (61-8) 6250 9099
Facsimile:        (61-8) 6250 9088
Email:            info@cityviewcorp.com
Web:              www.cityviewcorp.com

Auditors

BDO Chartered Accountants
267 St George's Terrace
Perth   Western Australia   6000

USA Auditors

Feldman Sherb & Co., P C
805 Third Avenue,
New York NY 10022

<PAGE>

USA Attorney

Gary B Wolff, P C
747 Third Avenue
New York   NY 10017

Company Secretary

Warren Martin Baillie

Australian Share Registry

Computershare Registry Services
45 St. George's Terrace,
Perth Western Australia, 6000

Telephone:        (61-8) 9323 2000
Facsimile:        (61-8) 9323 2033

USA Share Registry

Computershare Trust Company, Inc
1825 Lawrence Street, Suite 444
Denver, Colorado 80202-1817

Telephone:        (303) 984 4062
Facsimile:        (303) 986 2444

Stock Exchange Listings

Australian Stock Exchange Limited
Trading Code: CVI

NASD OTC Bulletin Board
Trading symbol: CTVWF

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE.
Not applicable

                                       2

<PAGE>

ITEM 3.  KEY INFORMATION.

A.   Selected financial data

     Selected Consolidated Financial Data

     The  selected  historical  data  presented  below has been derived from the
     financial  statements  of the Company,  which have been examined by Feldman
     Sherb and Co., P.C. in their report for the years ended  December 31, 2000,
     1999, and 1998 and by Deloitte Touche Tohmatsu,  Chartered Accountants,  in
     their  report for the years  ended  December  31, 1997 and 1996 and the six
     months  ended   December  31,  1996  and  by  Grant   Thornton,   Chartered
     Accountants,  and Deloitte Touche Tohmatsu,  Chartered Accountants, for the
     company's then subsidiary,  Western Resources NL, for the financial periods
     ended June 30, 1996.

     The consolidated financial statements are presented in  Australian  dollars
     and have been prepared in accordance  with  Australian  generally  accepted
     accounting  principles  ("Australian GAAP"),  which  may  vary  in  certain
     respects from generally accepted accounting principles in the United States
     ("US GAAP").

     The following table summarizes certain financial  information and should be
     read in  conjunction  with "Item 5 -  Operating  and  Financial  Review and
     Prospects."  The  Company  has not  declared a dividend  during each of the
     financial  periods  ended June 30, 1996,  and the years ended  December 31,
     1997, 1998, 1999 and 2000. There were significant  fluctuations in revenues
     and net income (loss)  between the years stated in the table below.  Please
     refer to Item 5 - Operating and  Financial  Review and  Prospects.  For the
     reasons set forth herein the information  shown below may not be indicative
     of the company's future results of operation.

     Statement of Loss and Accumulated Deficit Data:

<TABLE>
<CAPTION>

                            Year Ended    Six Months Ended    Year Ended       Year Ended        Year Ended      Year Ended
                             June 30,       December 31,     December 31,     December 31,      December 31,    December 31,
                               1996             1996             1997             1998              1999            2000
                          -------------- ----------------- ---------------- ---------------- ----------------- --------------
   Amounts in Accordance        AUD$             AUD$             AUD$             AUD$              AUD$             AUD$
   with Australian GAAP

   Income Statement Data:
   <S>                      <C>              <C>              <C>              <C>               <C>             <C>
   Operating revenues             -                   -                -                -                 -              -
   Loss from continuing
     operations (1)        (3,182,272)       (2,065,874)      (2,382,196)     (20,362,087)      (11,095,107)    (5,537,576)
   Loss from continuing
     operations per ordinary
     share (dollars) (2)        (1.40)            (0.38)           (0.21)           (1.53)            (0.70)         (0.13)

   Balance Sheet Data:

   Total Assets             4,468,564        15,635,535       24,688,249       13,247,886         7,579,445     16,227,889
   Shareholders' equity     3,069,848        14,842,222       16,150,035       (2,803,225)        5,491,274     15,936,943

   Amounts in Accordance
   with US GAAP

   Income Statement Data:

   Operating Revenues               -                 -                -                -                 -              -
   Loss from continuing
     operations (1)        (3,182,272)       (2,065,874)     (20,973,206)     (12,188,902)       (8,043,615)    10,373,578)
   Loss form continuing
     operations per ordinary
     share (dollars) (2)        (0.28)            (0.38)           (1.84)            (.92)            (0.51)         (0.25)

   Balance Sheet Data:

   Total Assets             2,891,352        13,986,629        5,052,513          737,413           136,645      4,165,087
   Shareholders' equity     1,492,636        13,193,296       (3,485,701)     (15,313,698)       (1,951,526)     3,874,141

</TABLE>

(1) Net income  (loss)  consists of  operating  profit  (loss)  after income tax
attributable to members of the parent entity.

(2) Per share data has been retroactively restated to reflect the effects of a 1
for 5 reverse stock split effective April 14, 1997.


                                       3

<PAGE>

Exchange Rates

Solely for  informational  purposes,  this Form 20-F  contains  translations  of
certain  Australian  dollar amounts into or from US dollars at a specified rate.
These translations should not be construed as representation that the Australian
dollar  amounts  represented  in the US dollar  amounts  indicated,  or could be
converted  into or from US dollars at the rate  indicated.  The following  table
sets forth, for the financial periods indicated,  certain information concerning
the  Noon  Buying  Rate for  Australian  dollars  expressed  in US  dollars  per
AUD$1.00.

         Period                         High       Low    Period-End  Average(1)
----------------------------------   ---------- --------- ---------- -----------

12 Months to June 30, 1995             0.7753     0.7108     0.7180     0.7404
----------------------------------   ---------- --------- ---------- -----------
12 Months to June 30, 1996             0.7980     0.7108     0.7856     0.7587
----------------------------------   ---------- --------- ---------- -----------
 6 months to December 31, 1996         0.8137     0.7735     0.7944     0.7918
----------------------------------   ---------- --------- ---------- -----------
12 months to December 31, 1997         0.7944     0.6515     0.6515     0.74.28
----------------------------------   ---------- --------- ---------- -----------
12 months to December 31, 1998         0.6806     0.5500     0.6139     0.6150
----------------------------------   ---------- --------- ---------- -----------
12 months to December 31, 1999         0.6569     0.62.40    0.6500     0.6429
----------------------------------   ---------- --------- ---------- -----------
12 months to December 31, 2000         0.6685      0.5073    0.5599     0.5828
----------------------------------   ---------- --------- ---------- -----------

At June 13, 2001  the  Australian dollar expressed in US dollars per AUD$1.00 is
$.52763.

[1]  Represents  the  average of the Noon  Buying  Rates on the last day of each
month during the period.

Nature Of Trading Market

The Company's ordinary shares commenced trading on the Australian Stock Exchange
Limited   on  January  2,  1992  and   commenced   trading  on  the   Electronic
Over-the-Counter  Bulletin  Board in the United  States on April 11,  1997.  The
Company  subsequently  gained  clearance  to trade on the NASDAQ  Small  Capital
Market  on June 11,  1997 and  continuously  traded on that  exchange  until its
delisting  effective May 8, 2000  subsequent to a February 11, 2000 oral hearing
before the NASDAQ Listing  Qualifications Panel which delisting was upheld (upon
Company  appeal) by the NASDAQ Listing and Hearing Review Council on October 25,
2000.

On December  29, 2000 the  Company's  securities  were listed for trading on the
NASD Electronic Over The Counter  Bulletin Board  ("OTCBB").  Dupont  Securities
Group, Inc., a wholly owned NASD member firm securities broker/dealer subsidiary
of Dupont Direct Financial Holdings,  Inc., a financial services holding company
was appointed to act as the initial,  exclusive  registered  market maker in the
Company's  securities on the OTCBB.  Other securities  dealers were permitted to
become  market  makers in the  Company's  securities as from January 24, 2001 as
provided for under the NASD rules.

As of May 31,  2001 the  Company  had 1,267  holders  of record of its  Ordinary
Shares.

                                       4
<PAGE>

The  Company  has not paid  any  dividends  since  it's  inception  and does not
anticipate  paying  any  dividends  on its  Ordinary  Shares in the  foreseeable
future.

The  following  reflects the high and low bid price for the  Company's  Ordinary
Shares as reflected on the Australian  Stock Exchange Limited for the last three
years.

   Quarter Ending         High       High         Low          Low       Volume
                          AUD$        US$         AUD$         US$      in 000's
---------------------- ---------- ---------- ------------ ------------- --------
March 31 1998             2.35      $1.56        $2.32          1.00        412
---------------------- ---------- ---------- ------------ ------------- --------
June 30 1998              2.00       1.62         1.93          1.12        816
---------------------- ---------- ---------- ------------ ------------- --------
September 30 1998         1.30       0.84         1.20          0.69      1,539
---------------------- ---------- ---------- ------------ ------------- --------
December 31 1998          0.90       0.50         0.90          0.47        411
---------------------- ---------- ---------- ------------ ------------- --------
March 31 1999             1.02       0.69         0.63          0.34      1,551
---------------------- ---------- ---------- ------------ ------------- --------
June 30 1999              0.80       0.53         0.55          0.31        929
---------------------- ---------- ---------- ------------ ------------- --------
September 30 1999         1.00       0.71         0.47          0.22      2,748
---------------------- ---------- ---------- ------------ ------------- --------
December 31 1999          0.95       0.59         0.65          0.31      9,423
---------------------- ---------- ---------- ------------ ------------- --------
March 31 2000             3.91       2.72         0.56          0.34    132,174
---------------------- ---------- ---------- ------------ ------------- --------
June 30 2000              2.30       1.47         0.75          0.34     34,245
---------------------- ---------- ---------- ------------ ------------- --------
September 30 2000         1.74       1.13         0.92          0.38      9,004
---------------------- ---------- ---------- ------------ ------------- --------
December 31 2000          1.17       0.50         0.61          0.16     13,205
---------------------- ---------- ---------- ------------ ------------- --------
March 31, 2001            1.14       0.64         0.35          0.18     16,864
---------------------- ---------- ---------- ------------ ------------- --------

                                       5

<PAGE>

ITEM 3 A (i)      COMPANY AUDITORS

BDO Chartered  Accountants (through their office in Perth, Western Australia) is
the Company's  independent auditors in connection with its reporting obligations
in  Australia  only while  Feldman  Sherb & Co.,  P.C.  ("FS") is the  Company's
independent auditors in connection with US reporting obligations.

History of Company auditors

Deloitte  Touche  Tohmatsu  ("D&T")  (through  their  office in  Perth,  Western
Australia)  had  previously   audited  the  Company's   consolidated   financial
statements  for calendar  years ended  December  31, 1999,  1998 and 1997 but no
longer  acts as the  Company's  independent  auditors.  All or certain  specific
portions of such audit were subsequently reviewed by Nasdaq personnel during the
course of  certain  hearings  which  subsequently  led to the  Company's  Nasdaq
delisting.  During the course of such  review,  questions  were raised as to the
applicability  of  Australian  Auditing  Standards  as opposed  to US  Generally
Accepting Accounting Principles ("US GAAP") and what reconciliation, if any, had
to be made  between  these  two  standards.  Additionally,  questions  regarding
related  issues were raised  during the course of the  Securities  and  Exchange
Commission ("SEC") review of this Form 20-F.

As a result  of the above and  notwithstanding  the fact that D&T had  initially
opined on the Company's financial statements included in its 1999 Form 20-F, D&T
subsequently  refused to opine on US GAAP matters (due to its  representation of
lack of sufficient familiarity  therewith) and, in effect,  withdrew its earlier
opinion.  In addition to the reason cited herein D&T indicated  that its refusal
to opine was also based upon its opinion that it now retroactively  felt that it
lacked the necessary  independence to do so due to the fact that it had prepared
an "Independent  Experts Report" on behalf of the Company in October of 1996 and
that,  accordingly,  D&T was of the  opinion  that it should  not have  acted as
CityView's   auditors  for  subsequent   years  with  respect  to  U.S.  matters
(notwithstanding   the  fact   that  D&T  felt  that   Australian   independence
requirements  did  not  preclude  it  from  auditing  the  Company's   financial
statements for Australian reporting purposes).

Management  turned to Feldman Sherb & Co., P.C.  ("FS").  FS, having  previously
been introduced to the Company by its counsel,  had initially  rendered  certain
consulting  services  to the  Company  (regarding  US  GAAP  disclosures  in the
Company's  Form 20-F and US GAAP  treatment of certain  completed  transactions;
specifically  relating to oil and gas acquisition and  exploration  costs.  Such
consulting  services  did  not  relate  to (a)  the  application  of  accounting
principles to proposed  transactions or (b) the type of audit opinion that might
be rendered by FS on the Company's financial statements. FS did not consult with
D&T regarding the above mentioned  issues.  As a direct result of the consulting
services  rendered  by FS to the  Company,  management  decided to utilize  such
firm's  services for auditing  purposes and filings within the U.S. for purposes
of compliance with US GAAP and securities related matters. Accordingly, FS which
was already  familiar with the Company's  Form 20-F having acted as  consultants
with  respect to  responses  to SEC comment  letters and Nasdaq  inquiries  (and
having  assisted in compilation and  preparation of various  correspondence  and
filings with the SEC in regards to the Company's Form 20-F  filings) was engaged
(on October 16,  2000) to audit the  Company's  financial  statements  for years
ended December 31, 1997, 1998 and 1999. A field audit was subsequently conducted
commencing  October 23, 2000.  FS's audit report dated October 27, 2000 is  part
of the Company's Form 20-F for the year ended December 31, 1999.

                                       6
<PAGE>

At the Company's May 31, 2000 Annual Meeting of  Stockholders,  D&T was replaced
as auditors  (in  Australia)  by the firm BDO  Chartered  Accountants  of Perth,
Western Australia,  which latter appointment was carried out with the consent of
Australian  Securities  and  Investments  Commission,   the  statutory  body  in
Australia  empowered with the  administration and regulation of corporations and
corporate law. The Company's Board of Directors participated in and approved the
decision to change independent accountants.

While D&T no longer acts as the Company's  auditors it still acts,  from time to
time,  as a  consultant  to the  Company  and  provided  assistance  and  backup
documentation  as was  required  by FS during the  latter's  audit  included  of
October 2000.

As a result of all of the above and most  specifically  the  initial and ongoing
consulting  services  rendered by FS to the Company   (as  aforesaid) its active
and ongoing  participation in preparing necessary responses to inquiries made of
the Company by both Nasdaq and the SEC and its knowledge with respect to US GAAP
matters,  management  decided to utilize the  services of FS as its auditors for
all  matters  regarding  or relating to US  governmental  and/or  administrative
agencies and/or accounting matters.

To summarize the above, D&T had been engaged as Company independent  auditors in
connection with Company reporting  obligations in both Australia and the U.S. On
May 31, 2000 BDO replaced D&T as Company independent auditors in connection with
its  reporting  obligations  in  Australia  only  while FS  replaced  D&T as the
Company's independent auditors in connection with U.S. reporting obligations.

The report of D&T on the  financial  statements  for the years  indicated  above
contained no adverse  opinion or  disclaimer of opinion and was not qualified or
modified as to uncertainty, audit scope or accounting principles.

In connection  with D&T's audits for the years  indicated  above,  there were no
disagreements  with D&T on any matter of  accounting  principles  or  practices,
financial  statement   disclosure,   or  auditing  scope  or  procedure,   which
disagreements,  if not resolved to the satisfaction of D&T would have caused D&T
to make  reference to them in their report on the financial  statements for such
years.

                                       7
<PAGE>
B.   Capitalization and indebtedness
        Not applicable

C.   Reasons for the offer and use of proceeds
        Not applicable

D.   Risk factors

Risks in respect of the Company's energy portfolio

The future  profitability  and  viability of  operations  and  activities in the
Company's  energy  portfolio will depend on a number of risks  including but not
limited to the following:

1.       Commodity prices and in particular the price of oil and gas;
2.       Currency exchange rate fluctuations;
3.       The  strength  of the equity markets at the time of any capital raising
         by the Company;
4.       Judicial decisions and legislative amendments;
5.       Environmental management issues with which the Company may from time to
         time have to comply;
6.       General economic conditions in Australia and south east Asian countries
         and  their  major  trading  partners and in particular inflation rates,
         commodity supply and demand factors and industrial disruption;
7.       Risks  inherent  in   exploration   including,   amongst  other things,
         successful exploration, identification, development and exploitation of
         use of resources and reserves, and competent management;
8.       Political stability of south east Asian countries.

There  is no  assurance  that any of the  Company's  energy  properties  contain
significant  commercially  viable  reserves  until  appropriate  and  sufficient
exploration  work is done and an economic and feasibility  study based upon such
work is  conducted.  The Company also owned  certain gold  interests  which were
disposed of during  1999.  Reference  is herewith  made to GOLD - Raeside  Joint
Venture and Duketon Prospects as appearing in the Company's 1999 20-F wherein it
was indicated  that in  consideration  for the discharge of certain  liabilities
aggregating  US$54,459  the  Company  sold its  subsidiary  and  interest in the
Raeside Joint Venture in November 1999 to an  unaffiliated  third party and sold
its  subsidiary  and  interest  in  Duketon  Prospect  in  December  1999  to an
unaffiliated third party for nominal consideration. CityView no longer holds any
gold interests.

                                       8
<PAGE>

Recoverability of loans by the Company to other companies

Early in 2000,  CityView acquired the rights to take up a strategic  interest in
Sands Solutions Group Pty Ltd ("Sands Solutions"), a developer of integrated B2B
applications. Under the terms of the Heads of Agreement, CityView agreed to make
a  commercial  loan to Sands  Solutions  with the right to convert the loan into
equity upon conclusion of extensive due diligence and an independent  valuation.
To date,  CityView has advanced  AUD$3 million under the terms of the loan.  The
loan to Sands  Solutions  is secured by a registered  fixed and floating  charge
over all the assets and  undertaking  of that  company.  Its  recoverability  is
reliant  in the  normal  course  of  trading  on the  planned  expansion  of and
increased revenues from the businesses  conducted by Sands Solutions or the sale
of those  businesses and other assets of that company.  It is considered that in
the event of default a sale of those  businesses and assets should would realize
sufficient  funds to satisfy the loan.  If the  Company  acquires an interest in
Sands Solution then it would set off the loan against any purchase money payable
for that acquisition.

The loans of  AUD$10,225,105  to Medco Madura Pty Ltd and Medco  Simenggaris Pty
Ltd represent moneys owing to the Company for work previously carried out on the
Madura and  Simenggaris  blocks in Indonesia  and paid for by the  Company.  The
ultimate  recoverability of these loans is dependent upon the future development
and  successful  exploitation  of the  Madura  and  Simenggaris  blocks by those
companies.

                                        9
<PAGE>

ITEM 4.  INFORMATION ON THE COMPANY.

A.   History and development of the Company

The term  "Company"  refers  to  CityView  Corporation  Limited,  a  corporation
organized under the laws of Western Australia on May 3, 1987, and its one wholly
owned  subsidiary  CityView Asia Pty Ltd.  During 2000 the Company  deregistered
five of the Company's  subsidiary companies as these companies were inactive and
superfluous to the Company's  requirements.  The names of these  companies were:
Western Akar  Petroleum  Pty Ltd;  Western  Wisesa  Petroleum  Pty Ltd;  Western
Nusantara  Energi Pty Ltd;  Western  Resources  NL; and  Western  Sangkimah  NL.
Another two of the Company's  former  subsidiaries  (Western  Madura Pty Ltd and
Western Simenggaris Petroleum Pty Ltd) are no longer subsidiaries of the Company
as these companies are now controlled by Pt Medco Energi  Corporation  which now
owns 75% of the shares in each of these companies.

The  Company  publishes  its  consolidated  financial  statements  expressed  in
Australian dollars. In this document, references to "US dollars" or "US$" are to
the  currency of the United  States of America  and  references  to  "Australian
Dollars" or "AUD$" are to currency of Australia.  Solely for  convenience,  Form
20-F contains  translations of certain Australian dollar amounts into US dollars
at   specified   rates.   These   translations   should  not  be   construed  as
representations  that the Australian  dollar amounts actually  represent such US
dollar  amounts or could have been or could be converted  into US dollars at the
rates indicated or any other rates. Unless otherwise indicated,  the translation
of  Australian  dollars  into US dollars has been made at the rate of AUD$1.00 =
US$0.5599,  the  noon  buy-in  rate in New  York  City for  cable  transfers  in
Australian dollars as certified for customs purposes by the Federal Reserve Bank
of New York (the "Noon  Buying  Rate") on December  31,  2000.  For  information
regarding rates of exchange between  Australian dollars and US dollars from 1991
to the present, see "Item 3A. Selected Financial Data - Exchange Rates."

The current  financial  period is for the twelve months ended December 31, 2000.
References in this document to a particular  prior year are to the calendar year
unless  otherwise  indicated.  The Company  produces  annual reports  containing
audited  consolidated  financial  statements  and  an  opinion  thereon  by  the
Company's  independent public accountants.  Such financial  statements have been
audited in  accordance  with  Australian  Standards  ("AIS").  The Company  also
produces  quarterly  reports as required by Australian  Stock Exchange  Limited,
which contain selected financial information, and notices to shareholders of the
Company.  The Company also produces financial  statements prepared in accordance
with  Australian  Accounting  Principles  ("AAP"),  which  are  required  to  be
furnished to shareholders under Australian law. AAP may vary in certain respects
from Generally Accepted Accounting  Principles in the United States ("US GAAP").
A reconciliation  between Australian and US GAAP for the financial periods ended
December 31, 2000,  1999, and 1998 are disclosed in footnote 26 to the financial
statements contained herein.
                                       10
<PAGE>

The Company is a corporation  organized  under the laws of Western  Australia on
May 3, 1987  under  the name  CityView  Investments  Limited  and was  listed on
Australian  Stock  Exchange  Limited as an investment  company.  The Company was
initially  listed on the Second Board of the Perth Stock Exchange on October 20,
1987 and was transferred to the Main Board of Australian  Stock Exchange Limited
on January 2 1992. The Company changed its name to CityView  Corporation Limited
on August 9 1996, to CityView Energy Corporation  Limited on May 19, 1996 and on
May 31,  2000  changed  its name to  CityView  Corporation  Limited.  CityView's
investments were focused originally on realty, then gold and realty, then energy
and gold and since January 2000 e-commerce and energy.

Australian Government Regulation

The Australian Securities and Investments Commission is an Australian government
instrumentality that administratively  enforces the Australian Corporations Law,
which  is  the  main  body  of  law  regulating  companies  in  Australia.   The
Corporations Law covers matters such as directors' duties and  responsibilities,
preparation of accounts,  auditor control, issue and transfer of shares, control
of shareholder  meetings,  rights of minority  interests,  amendments to capital
structure,  preparation  and filing of public  documents such as annual reports,
changes in directors and changes in capital.

Australian Stock Exchange Limited imposes listing rules on all listed companies,
including  the  Company.  The  listing  rules  cover  such  issues as  immediate
notification to the market of relevant information, periodic financial reporting
and the prior approval of shareholder  reports by the Australian  Stock Exchange
Limited.

The Company believes that it is in compliance with the foregoing Australian laws
and regulations.

                                       11

<PAGE>
B.   Business overview

General

The Company identified  Indonesia for its focus for acquisitions and development
of oil and gas reserves.  Indonesia was selected after considering prospectivity
for oil and gas,  demand for the produced  product,  availability  of supportive
infrastructure, foreign company participation terms and conditions and sovereign
risk.

Benefits Associated with Indonesia

Indonesia has a record for honoring participation agreements and keeping tax and
terms stable.  The process for co-operation with domestic and foreign parties is
explained as follows:

o        All oil and natural gas exploitation in Indonesia is the responsibility
         of Perusahaan Pertambangan Minyak dan Gas Bumi Negara ("Pertamina"), an
         enterprise established under the Law of the Republic of Indonesia
         Number 8 Year 1971.
o        Pertamina  may  co-operate  with  other parties by way of a "Production
         Sharing Contract," (hereinafter "PSC"), the form and terms of which are
         established by government regulations.
o        While terms have altered marginally since the PSC was first introduced,
         usually the objective of the change has been to improve the terms in an
         attempt to attract further foreign investment in Indonesia.
o        The   PSC  format  has  proved  a  stable  and  reliable  contract  for
         international investment.
o        The  Company  is  involved  in  two PSCs with Pertamina located onshore
         Madura Island and Onshore North  East  Kalimantan and the PSCs are held
         by Medco Madura Pty Ltd and  Medco  Simenggaris  Pty  Ltd  respectively
         (collectively hereinafter called "Madura and Simenggaris").

Indonesia is considered  one of the more mature regions of the world for oil and
gas  investment  in respect to security of tenure in contracts  covering oil and
gas rights of a foreign company.

Risks Associated with Indonesia

There  are a number of  factors  which may have a  material  downside  effect on
Madura and Simenggaris'  future financial  performance in Indonesia or the value
of the shares in the Company. These factors include:

 o Fluctuations in the world market price of oil and gas;
 o Fluctuations in the value of the Indonesian rupiah against the US dollar;
 o Abnormal interruptions in oil and gas production  or  delivery resulting from
   war, political disturbance, civil unrest or industrial disruption;
 o Changes in government, government regulations or the relevant fiscal regime;
 o Unforeseen  adverse geological conditions; o Unavailability or excessive
   costs of industry service support, caused by any of the above.

The Company  believes that the benefits  described above far outweigh the risks.
There is no assurance,  however,  that one or more of the  aforementioned  risks
will not severely damage Company prospects and operations.

                                       12
<PAGE>

Selection of Target Areas for Acquisition

The criteria  for  assessing  oil and gas  opportunities  in Indonesia  includes
consideration of the following:

o        Detailed  review  of  geological  and geophysical information available
         from Pertamina and other sources.
o        Assessing  proximity  of  the  oil  and/or  gas  prospect to a means of
         transporting the  production  to  market.  The  foregoing component  of
         production  costs  can significantly affect the economics of a project.
o        Assessing access  to support services such as engineering, rig services
         and service contractors.  Costs  for mobilization and demobilization of
         such services is an important consideration.
o        Assessing field prospects of oil and gas, usually determined by quality
         and quantity of  geophysical,  geological, petrophysical and production
         data available.
o        Assessing the degree  of  difficulty  in  producing  the  oil  and  gas
         prospect  from  an  engineering  perspective,  to  enable  an  accurate
         assessment of production costs.
o        Conducting commercial analysis to establish the ability of a particular
         project to achieve adequate rate of return on investment.

Evaluation Techniques

Experienced  geologists and  geophysicists  are engaged as contractors to employ
the  most  advanced  technologies  of  investigation  in  assessing  hydrocarbon
prospects.  These include  reprocessing and reinterpretation of existing seismic
data.  Afterwards the data in its original  interpreted  form can be enhanced to
enable more accurate  mapping of the  structure.  The  technology  available for
seismic acquisition and processing is continually being improved. Interpretation
tools such as computer mapping and modeling packages,  enable greater amounts of
data to be  processed  and  superior  interpretations  to be  made.  Madura  and
Simenggaris  utilize  both  the  data  directly  relating  to  the  field  being
investigated,  along with regional data to compile as complete an  understanding
as the available data will allow.

Electrical  wireline logs are utilized  where  available to interpret  reservoir
parameters  of  interval  thickness,   hydrocarbon  presence,   porosity,  water
saturation and other important  parameters.  This data is interpreted  utilizing
experienced engineers and advanced software packages designed for such analysis.
The result are then integrated with the geological and geophysical  information,
in an endeavor to use one form of analysis to confirm the other.

Utilizing the  geophysical  mapping and the  petrophysical  interpretation,  the
reservoir  engineer is then able to estimate  potential  oil and/or gas reserves
and  recovery  factors  likely to be achieved.  Any  available  past  production
records are analyzed and can often be utilized as a means of  predicting  future
production  rates and cumulative  production  forecast,  by extrapolation of the
past results,  utilizing  accepted  engineering  practices.  The  application of
computer  models can also aid the reservoir  engineer in forecasting  production
potential. An accurate model can duplicate past production history.

                                       13
<PAGE>

Market for Oil and Gas Production

The market for oil and gas production in Indonesia is generally regulated. Under
the terms of the PSC,  Madura and  Simenggaris  have the right to sell their oil
production to Pertamina at the  government  established  Indonesian  Crude Price
(hereinafter  "ICP") and Pertamina cannot refuse to buy the production.  The ICP
is an  average  price  for a basket of crude  oil.  The  basket  used in the ICP
calculation  is  comprised  of Sumatra  Light  Crude  (SLC),  Tapis  crude (from
Malaysia),  Oman crude, Dubai crude and Gippsland crude (Australia)  prices. The
ICP is adjusted on a monthly  basis at the end of each month and then applied to
the same  month.  The price for a  particular  crude  oil in  Indonesia  is then
adjusted  relative to the crude  quality.  Pertamina has  strategically  located
facilities  throughout  most of  Indonesia,  where  crude oil can be  delivered,
commonly referred to as the "Point of Custody  Transfer." Madura and Simenggaris
are responsible for their portion of costs for delivering the crude to the Point
of Custody Transfer. Above certain levels of production,  Madura and Simenggaris
have the right to sell its oil  production  on the world market if it is able to
negotiate  preferred selling terms.  Preferred selling terms are terms which are
more  favorable  then those  available to the  contractor  under the ICP pricing
system.

Under the  standard  terms of  Technical  Assistance  Contracts  and  Production
Sharing  Contracts,  the  contractor  has the right  during the term  thereof to
freely  lift,  dispose of and export 100% of its share of crude oil,  and retain
abroad  the  proceeds  obtained  therefrom.  After 5  years  of  production  the
contractor is required to meet its domestic  market  obligation  and sell 25% of
its share of production to Pertamina at 15% of the prevailing price.

All  producers  in a producing  region  receive  the same  price.  The major oil
companies purchase crude oil offered for sale at posted field prices.  There are
price  adjustments  for quality  difference  from the Bench Mark.  Oil sales are
normally  contracted  with a gatherer who will pick-up the oil at the well site.
In some instances there may be deductions for transportation  from the well head
to the sales  point.  At this time the majority of crude oil  purchasers  do not
charge  transportation  fees, unless the well is outside their service area. The
oil gatherer  will usually  handle all check  disbursements  to both the working
interest  and  royalty  owners.  The  Company  was a working  interest  owner to
December 31,  1999.  In January  2000 the Company  entered an agreement  for the
Company's  interest in the new work  programs  to be carried by Pt Medco  Energi
Corporation Tbk.  Commencing January 1, 2002 the Company expects to be a working
interest  owner.  By  being  a  working  interest  owner,  the  Company  will be
responsible for the payment of its proportionate share of the operating expenses
of the well. Royalty owners and over-riding  royalty owners receive a percentage
of gross oil production  for the  particular  lease and are not obligated in any
manner whatsoever to pay for the cost of operating the lease.

Gas is sold  direct  to  consumers  at prices  determined  by  Pertamina  in the
following range:

   Industry                      Price Range per MCF

Fertilizer manufacture              US$1.00 - US$1.50
Petrochemical                       US$2.00
Steel Industry Process              US$0.65
Steel Industry Fuel/Power           US$2.00
Electricity generation              US$2.45 - US$3.00
Cement manufacture                  US$3.00
Other                               US$2.70

                                       14
<PAGE>

The lower gas prices in some industry  sectors are a form of subsidy  imposed by
the  government.  Larger gas reserves near to LNG  facilities are able to supply
gas to these operations. Indonesia is the largest exporter of LNG in the world.

The gas purchaser will pay the well operator 100% of the sales proceeds each and
every month for the previous  months sales.  The operator is responsible for all
checks and distributions to the working interest and royalty owners. There is no
standard price for gas. Depending on the type of contract, ultimate destination,
transportation,  treatment and compression charges, the prices will vary. Prices
will fluctuate with the seasons and the general market  conditions.  The Company
does  not  anticipate  any  significant  change  in  the  manner  production  is
purchased.  However,  no  assurance  can be given at this time that such changes
will not occur.

As  Indonesia  moves  closer  towards  becoming a net importer of crude oil, the
Indonesian government, through the state owned enterprise Pertamina in which all
oil and gas reserves are vested, is endeavoring to increase  production  through
new  incentives to attract  foreign  expertise and capital for  exploration  and
production, through development and enhancement of existing reserves.

Government incentives for PSCs include:
o        After  tax  split  for oil, new incentive 35% Contractor Equity, from a
         previous range of  15% to 25%. This in effect means that the Contractor
         can receive a larger  portion  of  the total production from any field,
         after the deduction of Operating Costs. Allowing for a tax rate of 44%,
         the  Contractor  is  entitled  under  this  legislation,  to  62.5%  of
         remaining production after recovery of  Operating  Costs  pre  tax,  as
         opposed to the previous entitlement of 26.7857% to 44.6428% pre tax.
o        After tax split for gas 40% for Contractor, from 35% previously. As for
         the  above,  the  Contractor  is entitled to 71.426% of the production,
         after deducting Operating Costs, as opposed to 62.5% previously.
o        Domestic market oil fee increased  from  15%  of  crude price to 25% of
         crude price. Under the terms of all TACs and PSCs,  the  Contractor  is
         required to sell and deliver to Pertamina a portion of the share of the
         Crude Oil to which the Contractor is entitled, at the  Domestic  Market
         Oil  Fee,  which  is  a  set  percentage of the price realized  by  the
         Contractor  for  all other production from the Contract Area. Under the
         previous  regulations,  the Contractor received only 15% of such price,
         whereas under the new  legislation,  the Contractor receives 25% of the
         realized price. The net result is  that  the Contractor is receiving an
         additional 10% of the Crude Oil price for  that  portion  of  Crude Oil
         which it is obligated to sell and deliver to Pertamina  to  fulfill the
         Contractor's obligation towards the supply  of  the  domestic market in
         Indonesia.
                                       15
<PAGE>

o        First  Tranche  Petroleum  reduced  from  20%  to  15%.  First  Tranche
         Petroleum,  being  a  portion  of  the total Petroleum production to be
         split  between  the  parties  before  any  deduction  for  recovery  of
         Operating Costs, reduces the amount available for recovery of Operating
         Costs. As the Contractor is providing funding under the contract terms,
         it  is  in  the  Contractor's interest to have as much of the Petroleum
         production available  for recovery of such costs, prior to distribution
         between   the  parties  thereafter.  Reduction  of  the  First  Tranche
         Petroleum  percentage  from  20%  to  15% means an additional 5% of the
         Petroleum production is available to the Contractor for Cost Recovery.

The price for oil in  Indonesia  is tied to a basket of crude  oils  around  the
world,  ensuring an "international"  price dependency.  The basket of crude oils
used to establish the ICP effectively means that the ICP is very much subject to
world oil prices, giving it international stability as opposed to being affected
by domestic constraints.  The ICP compares favorably with other comparable crude
oils in that its price is  formulated  from a basket of  comparable  crudes from
other countries.

Energy Portfolio

Madura Block onshore Madura Island near Surabaya east Java


On January 28, 1997 the President Director of Pertamina awarded the Madura Block
to  CityView  and  signed  the  authorization  for  CityView's  then 100%  owned
subsidiary Western Madura Pty Ltd ("Western  Madura") to commence  operations on
the Madura  Block  prior to the formal  signing of the  PSC-JOB  agreement.  The
signing of the  contract  took place on May 15,  1997,  awarding  the  2728km(2)
Madura  Block  to  Western  Madura  for an  exploration  term  of 10  years  and
production term of 20 years.  CityView was not required to make any cash payment
for this award and no payment in cash or  otherwise  was made by or on behalf of
CityView for the award of the Madura Block.

The block covers an area of 674,100  acres and lies in the oil and gas region of
east Java. A number of large fields have been  discovered in the vicinity and it
is these same  producing  trends which are being  examined on Madura.  The block
lies close to the heavily industrialized city of Surabaya where there is a ready
market for oil and gas.

History

Oil and gas  exploration  began on Madura Island in the late 1800's to 1910 with
over 100  shallow  (less  than  500m)  wells  drilled  on oil seeps and  surface
features.  Production was marginal with a cumulative  total of less than 1.0MMBO
("Million  barrels of Oil").  Exploration  was  limited  on the block  until the
1970's when it was held in succession by Indonesia  Cities  Services,  Pertamina
and Shell.  Several  generations of seismic data were acquired in the 1980's and
1990's but only 6 wells have been drilled on the Island since 1910.

Throughout  1999,  discussions  took place with PT Medco Energi  Corporation TBK
("Medco")  for  Medco to  supervise  and pay for the new work  programs  for the
development and bringing into production of the Madura block.

                                       16
<PAGE>


Approval was given at the Company's General Meeting held on December 30,1999 for
the Company to allot a 75% interest in Western Madura to Medco in  consideration
of Medco  carrying out and paying for the new work  programs.  The agreement was
signed between CityView and Medco on January 25, 2000. The Company's interest in
Western Madura was reduced from 100% to 25% and Western Madura was renamed Medco
Madura Pty Ltd. In accordance  with the above,  Medco submitted to Pertamina for
approval a Year 2000 budget of  US$3,519,000  for the drilling of three wells on
the Sebaya and  Karasan  prospects  at Madura in the second and third  quarters.
Medco is the operator of the block and required to supervise and pay for the new
work programs for development and bringing into production of the fields.  After
that,  Medco and the Company will  contribute on a pro-rata  basis in accordance
with the respective 75% and 25% interests with the Company continuing to receive
25% of any profits generated.

Medco is free carrying  CityView  throughout  the new work programs  agreed with
Pertamina.  The program includes substantial drilling and will be carried out at
no cost to CityView.

Medco has  completed  an  extensive  program of  reprocessing  seismic  data and
geological and geophysical  studies.  As a result of this  evaluation,  drilling
locations have been selected on two prospects,  Karasan and Sebaya, for drilling
in mid 2001.

Karasan is a 2000-3000 acre  structure at the Prupuh  limestone  level.  Seismic
data gives  strong  indications  that the  feature is  probably a reef  build-up
analogous to the Mudi reef  discovery in east Java (40 million  barrels of oil).
Karasan will be predominately gas bearing.  The proposed well will be drilled to
a depth of 1,250 meters.

Sebaya is a large faulted anticlinal feature underlying the old Kertegeneh field
discovered in 1900. Oil production from Kertegeneh confirms that Sebaya may have
commercially  viable oil  production  capabilities.  Most of the Tawun and Tuban
sections have not been tested by the older shallow wells. The proposed well will
be drilled to a depth of 1230 meters.

                                       17
<PAGE>

Regional Setting

There is an E-W terrain running across the block that underwent inversion in the
Plio-Pleistocene.  Within that band, a number of structures have been identified
^due to the  inversion  at  fairly  shallow  levels.  These  relatively  shallow
features are the principal target for the Medco Madura Pty Ltd program.

Prospects
Market

Medco Madura Pty Ltd has discussed with the local Madura  government  downstream
projects  which  include a small  refinery and a power plant to supply the local
market and displace imports from East Java.

                                       18
<PAGE>

Simenggaris Block onshore north-east Borneo

On  September  28,  1997  the  President   Director  of  Pertamina   signed  the
authorization  for  CityView's  then  100%  owned  subsidiary   Genindo  Western
Petroleum  Pty  Ltd  ("Western  Simenggaris")  to  commence  operations  on  the
Simenggaris  Block  prior to the formal  signing of the PSC-JOB  agreement.  The
signing of the Contract  took place on February 24, 1998  awarding the 2734km(2)
Simenggaris Block to Genindo.  The contract term is 10 years for exploration and
20  years  for  production.  Genindo  changed  its name to  Western  Simenggaris
Petroleum  Pty Ltd on June 22 1998.  CityView  was not required to make any cash
payment  for this award and no payment  in cash or  otherwise  was made by or on
behalf of CityView for the award of the Simenggaris Block.

The block  covers an area of 675,582  acres and lies in the oil and gas  Tarakan
Basin region.  The nearby giant  Pamusian  field was  discovered in 1905 and the
Bunyu  field in 1920.  Four  discoveries  have been made  within the block:  the
Sembakung oilfield (40 million barrels oil), the Bangkudulis oilfield, Sesayap-1
and  S.Sembakung-1.  The  former  two are  producing  fields  excluded  from the
contract  area and the latter  two are  undeveloped  gas-condensate  discoveries
which do form part of the contract area.

Similar to the agreement negotiated with Medco on Madura, CityView retains a 25%
interest in exchange for being free carried  throughout  the work program as per
the January 25, 2000  agreement.  Medco has selected a drilling  location at the
Pidawan  prospect  and the cost of drilling  this well will form part of the new
work program. The proposed well will be drilled to a depth of 2,300 meters.

History

The  Simenggaris  Block is adjacent to some of the  earliest oil  production  in
Indonesia with exploration dating back to the 1890's. Exploration was limited on
the  block  until  the late  1960's  when  portions  of the  block  were held in
succession by Japex, ARCO, Deminex and Pertamina. Several generations of seismic
data were  acquired and 15 wells were drilled  within the Block  leading to four
discoveries:   Sembakung  oil  field,   Bangkudulis  oil  field,  Sesayap-1  and
S.Sembakung-1.  The former two are producing  fields  excluded from the Contract
area and the latter two are undeveloped gas-condensate discoveries.

Regional Setting

The  Simenggaris  Block lies in the Tarakan  Basin  region.  The  Tarakan  Basin
stratigraphy  consists  of a classic  prograding  deltaic  sequence  from  upper
Miocene through  Pliocene time. The majority of the reserves are found along the
Kalimantan coast in Pliocene age deltaic reservoirs.  Further inland gas and oil
are found in upper Miocene age, paleogeographic equivalent,  deltaic reservoirs.
The upper Miocene age reservoirs are under explored and will be the focus of the
Medco work program.

                                       19
<PAGE>

Prospects
Market
Several gas markets  have been  identified  for the  Simenggaris  Block with gas
prices of US$1.00-1.50 per MCF expected,  based on current pricing levels. These
markets  include a future  fertilizer  plant and also a methanol  plant on Bunyu
Island.

                                       20
<PAGE>

Philippines Block SC41, offshore Sabah Malaysia

ARCO  Philippines  Inc,  Preussag  Energies GMBH,  MMC  Exploration & Production
(Philippines)  Pte Ltd ("MMCEPPL") and a consortium of fifteen Filipino resource
companies hold Block SC41 in the Sandakan Basin in offshore Philippines adjacent
to the border with Sadah East  Malaysia.  SC41  includes an area of about 12,000
km2 (3 million  acres) on which ARCO has acquired  5,100 km of seismic data with
simultaneous gravity and magnetic surveys.   The Sandakan Basin is filled mainly
with  Mio-Pliocene age  fluvio-deltaic  sedimentary  rocks that are analogous in
many ways to the prolific Baram and Mahakam deltas adjacent to Borneo.

ARCO has mapped several large  prospects in the undrilled  distal portion of the
delta complex.  Seismic amplitude anomalies and flat spots that conform to these
structures indicate that hydrocarbon  generation,  migration and entrapment have
occurred.  Twelve  prospects of potential have been identified in SC41 including
the Rhino  prospect and the Hippo  prospect,  both of which have  confirmed  the
presence  of  hydrocarbons.  UNOCAL  is now the  operator  of the  block  and is
carrying out a detailed  analysis of the 3D seismic to  determine  the next well
location.

In  June of  1999  the  Company  executed  an  agreement  with  Malaysia  Mining
Corporation  Berhad  (MMC) for the  transfer  to MMC of its 49%  interest in MMC
Exploration  &  Production   (Philippines)  Pte  Ltd,  in  satisfaction  of  its
outstanding debt of US$10,555,450 to MMC and discharge (January 24, 2000) of the
deed of charge dated February 4, 1998.

On April 13, 2000 CityView  acquired from ASAB Resources Limited a 2.5% interest
in Block SC41 for AUD$4,620,002. This  interest is free carried by MMCEPPL (i.e.
CityView is not  required to  contribute  financially)  through the current work
program. See also Item 5 - "Energy".

Market
Oil is easier  to  produce  and  market as it would  simply be  produced  from a
floating  production  storage unit ("FPSU") and then  delivered  anywhere in the
country.  Gas is more difficult to monetize as it will require a pipeline to get
the gas to  market  and costs  associated  with  laying a  pipeline  far  exceed
production  and  marketing  costs  for  oil in  the  regions  discussed  herein.
Marketing opportunities in nearby Sabah would be examined.

                                       21
<PAGE>
Past Energy related activities

Timoforo
On shore Irian Jaya

CityView's  then 85% owned  subsidiary,  Western Wisesa  Petroleum Pty. Ltd, was
formed to negotiate with Pertamina to secure title to the block. During 1999 the
Company  ceased its  negotiations  for the block on the  grounds  of  inadequate
commerciality.

Tuba Obi East ("TOE")
Onshore South Sumatra

In June 1994, Pt Akar Golindo (PTAG) was invited by Pertamina to bid on the Tuba
Obi East Block in Sumatra.  On August 1, 1996  CityView  signed a Memorandum  of
Understanding  with PTAG to form a joint company  Western Akar Petroleum Pty Ltd
("Akar")  to operate  and  develop  TOE.  Akar (then a 90% owned  subsidiary  of
CityView)  then  signed a TAC for Tuba Obi East on May 15,  1997.  The  block is
55km(2) in size.

During  1999  the  Company  withdrew  from  TOE on  the  grounds  of  inadequate
commerciality.

Tanjung Miring Timur ("TMT")
Onshore South Sumatra

On December 17, 1996 CityView's  then 80% owned  subsidiary,  Western  Nusantara
Energi Pty Ltd ("Nusantara") signed a TAC to take over the operations of the TMT
Oilfield.

During  1999  the  Company  withdrew  from  TMT on  the  grounds  of  inadequate
commerciality

Sangatta Sangkimah
East Kalimantan

On December 8, 1995 CityView's then wholly owned subsidiary Western Sangkimah NL
("Western")  was assigned an 87.5% interest in a TAC for the Sangkimah  oilfield
which lies within a Pertamina concession area known as Sangatta.

To comply with  Pertamina's work program a workover of Well No. SS-1 was carried
out in  December  1997  which  confirmed  a minimum  production  rate of 30BOPD.
Operations on Well No. SS-1 were then suspended.  An exploratory  well No. SST-1
was then drilled to a depth of 1550 m to test the "Q" sands.  After encountering
only minor oil content the well was plugged.

                                       22
<PAGE>

During 1999 the  Company  withdrew  from  Sangatta  Sangkimah  on the grounds of
inadequate commerciality.

Competition

The oil and gas industry is highly  competitive.  The Company's  competitors and
potential  competitors include major oil companies and independent  producers of
varying sizes which are engaged in the  acquisition of producing  properties and
the exploration and development of prospects.  Many of the Company's competitors
have greater financial,  personnel and other resources than does the Company and
therefore  have  a  greater  leverage  to  use in  acquiring  prospects,  hiring
personnel and marketing oil and gas.  Accordingly,  a high degree of competition
in these areas is expected to continue.

Indonesian Government Regulation

The Company may either sell its production on the international market or opt to
sell it  domestically.  There is a commitment to sell 25% of any oil  production
domestically (called Domestic Market Obligation) at 15% of the crude price. This
commitment  is imposed in the terms of all PSCs and does not vary between  PSCs.
This commitment  becomes  effective after the first 60 months of production.  As
the fields have not reached a level of  commercial  production,  the  commitment
does not currently apply. There are no constraints on production.  Indonesia has
no exchange controls; therefore, foreigners are able to move funds freely in and
out of the country through accounts denominated in local foreign currency.

On all  projects in which a company into a PSC with  Pertamina,  it is obligated
to:

        o Conduct  an  environmental baseline assessment at the beginning of its
          activities.
        o Take  the  necessary precautions for protection of ecological systems,
          navigation  and  fishing, and prevent extensive pollution of the area,
          sea or rivers  as  the  result of operations undertaken under the work
          program.
        o After  the expiration or termination or relinquishment of any contract
          area,  or  abandonment  of  any  field,  remove   all   equipment  and
          installations from the area in a manner acceptable  to  Pertamina, and
          perform all necessary site restoration activities  in  accordance with
          applicable government regulations, the costs  of  which are treated as
          operating  costs  and  are  thus  cost  recoverable,  through  project
          revenues.

The Company considers these environmental obligations to be a part of its policy
of good  oil  field  practice  and  further  acknowledges  that  the  terms  are
considered normal throughout the world.  Further,  the Company believes that the
foregoing  obligations  will  not  have  a  material  impact  on  the  Company's
operations.

                                       23
<PAGE>

B2B E-Commerce Investment

In  January  2000,  CityView  agreed  to  acquire  certain  rights  to take up a
strategic  interest  in Sands  Solutions  Group Pty Ltd ("Sands  Solutions"),  a
developer  of  integrated  B2B  applications.  Under  the  terms of the Heads of
Agreement,  CityView  agreed to make a  commercial  loan under the security of a
fixed and floating  charge over Sands  Solutions,  with the right to convert the
loan into equity upon  conclusion of extensive due diligence and an  independent
valuation.  To date, CityView has advanced AUD$3 million  under the terms of the
loan.  The outcome of this valuation and the due diligence  investigations  will
determine  the  level of  equity  that  CityView  ultimately  acquires  in Sands
Solutions and its price.  The extensive  due diligence  will enable  CityView to
limit its risk  whilst at the same time  earning  interest  on monies  advanced.
Simultaneously the maximum amount payable under the agreement for a 40% interest
has been capped at AUD$20 million.  By capping the entry costs and extending the
due diligence  period,  CityView has, to a degree,  insulated itself from market
fluctuations.  The  acquisition  by CityView of any interest in Sands  Solutions
above 10% requires that a Prospectus be filed by CityView with Australian  Stock
Exchange   Limited  in  accordance  with  the  requirements  of  the  Australian
Securities and Investments Commission.  While the filing of such Prospectus does
not generate comments,  it does require accuracy of all material  information so
as to avoid director's personal liability for material misstatements.

The Heads of  Agreement  was  negotiated  on an  arms-length  basis  between the
directors of each  corporation not having any overlapping  interest in the other
corporation.  Similarly the due diligence of Sands  Solutions is being conducted
by the independent directors of each Company.

This manner of proceeding has been necessary due to the fact that a family trust
of  CityView's  CEO used to own fifty  percent of Sands and  McDougall  and owns
one-third  of Sands  Solutions.  The trustee of the Smyth family trust is Salant
Nominees  Pty Ltd and its two  directors  are  Peter  Mark  Smyth  and his  wife
Jennifer Lee Smyth.  Mr and Mrs Smyth control the family trust in their capacity
as its sole two  directors.  Also,  Mr Smyth was a  director  of both  Sands and
McDougall and Sands Solutions although he is no longer a director of either.

To avoid  potential  conflicts the directors  representing  CityView in dealings
with Sands Solutions are its independent directors Peter John Augustin Remta and
Leslie Robert Maurice Friday while Sands  Solutions is primarily  represented by
Paul William Keogh, one of its directors.

CityView  anticipates  that the  outcome of the  independent  valuation  and due
diligence  investigations  will  determine  the  level of equity  that  CityView
ultimately acquires in Sands Solutions and its price.  CityView anticipates that
payment for the acquisition of an equity  interest will be accomplished  through
conversion  of the AUD$3  million loan to Sands  Solutions  and through  further
funds it may be able to receive from private  placements  of  CityView's  shares
with otherwise unaffiliated third parties.

                                       24
<PAGE>

CityView  raised the AUD$3  million  that has been lent to Sands  Solutions,  in
part, by issuing 7,300,000  CityView shares in January 2000 to private placement
participants for proceeds of AUD$3,613,500  with these shares (once issued) then
representing  approximately  20% of all outstanding  CityView shares and with no
one participant (or group of participants acting in concert) being or becoming a
principal stockholder of CityView.

History of Sands Solutions

In 1994 Sands & McDougall,  a Western  Australian office supplier,  successfully
evolved a B2B solution for its largest  customers such as Alcoa and  Caterpillar
who wished to reduce their procurement costs.

As business grew Sands  Solutions was  established in 1994 to meet the expanding
demand. After prototype electronic-data  interchanges,  a closed-loop integrated
processing system called Smart Clips was developed.  Initial  installations were
based on  client/server  technologies,  but  since  then new  systems  have been
introduced that are true  internet/intranet  applications with benefits in terms
of ease of use, security and integration to existing accounting systems.

The  primary  target  for the  application  of  Smart  Clips  are  existing  ERP
(Enterprise  Resource  Planning)  suites.  Most ERP suites were installed in the
1990's at a high capital cost to organizations  implementing  them. These suites
primarily  support   unsynchronized   batch  oriented  data  exchange,   whereas
e-business requires near real-time message exchanges.  Architecturally,  most of
the  installed  bases of ERP suites are not  capable of  effectively  supporting
e-business  initiatives.  As businesses  are reluctant to write-off  their large
investment in ERP suites,  they are actively seeking to leverage it. Smart Clips
applications  enable them to do this as they deliver greater  functionality at a
fraction  of the  capital  and  implementation  cost  of  other  recognised  B2B
e-procurement applications.

The  e-procurement  sector of the e-business  services market is predicted to be
the biggest  growth  sector over the next five  years.  According  to the Boston
Consulting Group, spending on e-commerce systems in Australia will grow from $17
billion  in 2000  to $235  billion  by  2005,  with  22% of  transactions  being
conducted online by 2005. Sound business fundamentals are the key characteristic
of the  present  e-business  revolution  which  is  being  led by "old  economy"
companies.  Conventional  businesses are taking the tools crafted in the dot-com
boom and adapting them.  Sands Solutions  expects that the results over the next
five years will be startling as e-business tools are used to streamline internal
operations  and  make  possible  new  business  ventures  that  were  previously
unachievable.

Sands Solutions believes that it has a sustainable competitive advantage through
the depth of its position in the e-procurement market which has been continually
enhanced with each additional buy-side  application  released.  The deepening of
Sands Solutions' position will be further  strengthened with the roll out of its
m-commerce  solution in the third quarter of 2001. The Smart Clips e-procurement
solution is  comparable  to the emerging  "peer to peer" B2B  e-commerce  models
described in the Harvard Business Review, November-December 2000: the difference
being that Smart Clips is a proven working solution,  several years ahead of its
competitors.

                                       25
<PAGE>

Originally  Smart Clips was  restricted  to the  customers of Sands & McDougall.
Last year was the first time that Smart Clips was made  available to the public.
With dot com hype  overheating the market in 2000,  marketing of Sands Solutions
products was deferred  until 2001.  The downturn in the world economy has turned
attention  to cost  reduction  rather  than  sales  increase  so that the timing
appears right to market the applications.

The initial idea for the acquisition of an interest in Sands Solutions  resulted
from  substantial   negotiations  between  London  Partners  Australia  Pty  Ltd
("London")  and Sands and  McDougall  personnel  with London then  presenting  a
proposal to CityView.  Mr Smyth did not propose  CityView's  investment in Sands
Solutions.  Initially, London proposed an investment in Sands Solutions to Sands
Solutions and after an extensive  discussion  between Mr. William Keogh of Sands
Solutions and London's  Victor  Melville of London,  London felt that  CityView,
then  being a NASDAQ  and  Australian  Stock  Exchange  Limited  ("ASX")  listed
company, was a good candidate to propose an acquisition with London feeling that
such stock exchange  listing(s) would give CityView a better  opportunity than a
non-public  company to raise funds for such  acquisition.  London then made such
suggestion  to CityView  after it (London) had both  initiated,  negotiated  and
orchestrated the proposed transaction.

The relationship between London and CityView is a business  relationship whereby
London assists CityView in its private  placements in its capacity as a licensed
securities dealer that assists in raising funds for various  corporations in the
normal course of its business while also providing corporate  consulting advice.
London is otherwise unaffiliated with either CityView or Sands Solutions.

The  proposed  investment  in Sands  Solutions  is intended as an  expansion  of
CityView  business  and not as a change  of  business  operations,  as  CityView
remains actively engaged in energy operations as indicated herein.

C.   Organizational structure

The  Company  conducts  its  operations  through  itself  and its  wholly  owned
subsidiary CityView Asia Pty Ltd.

During 2000 the Company  deregistered five of the Company's subsidiary companies
as these companies were inactive and superfluous to the Company's  requirements.
The names of these  companies  were:  Western Akar  Petroleum  Pty Ltd;  Western
Wisesa  Petroleum Pty Ltd; Western  Nusantara Energi Pty Ltd; Western  Resources
NL; and Western  Sangkimah NL. Another two of the Company's former  subsidiaries
(Western Madura Pty Ltd and Western Simenggaris Petroleum Pty Ltd) are no longer
subsidiaries  of the Company as these  companies are now  controlled by Pt Medco
Energi Corporation which now owns 75% of the shares in each of these companies.

                                       26
<PAGE>
D.    Property, plant and equipment

Particulars of oil leases

Madura - Medco Madura Pty Ltd and  Simenggaris - Medco  Simenggaris  Pty Ltd The
Company's wholly owned subsidiary CityView Asia Pty Ltd owns 25% of Medco Madura
Pty  Ltd  and 25% of  Medco  Simenggaris  Pty Ltd  since  May  26,  2000  having
previously owned (since December 31, 1999) 100% of such properties.

Executive address

On May 1, 2000 the  Company  relocated  its  offices  to leased  premises  at 63
Burswood Road, Burswood,  Western Australia,  telephone:  (61 8) 6250 9099, fax:
(61 8) 6250 9088, email: info@cityviewcorp.com.


                                       27
<PAGE>

ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS.

A.   Operating results

The current  financial  period is for the twelve months ended December 31, 2000.
The Company's  consolidated financial statements are prepared in accordance with
Australian  Generally Accepted Accounting  Principals  ("Australian GAAP") which
may vary in certain respects from Generally  Accepted  Accounting  Principals in
the United States ("US GAAP"). A reconciliation  between  Australian and US GAAP
for the financial  periods ended December 31, 2000, 1999, and 1998 are disclosed
in footnote 26 to the financial statements contained herein.

The following  discussion  references  the amounts  computed in accordance  with
Australian  GAAP for the results of  operations of the Company for the financial
periods ended December 31, 2000, 1999, and 1998..

Principal Activities

The  principal  activities  of  the  Company  during  the  financial  year  were
investments in energy, electronic commerce and most recently telecommunications.

Results of operations

The discussion set forth below relates to the Company's results of operations as
prepared in accordance with Australian GAAP. A reconciliation between Australian
and US GAAP for the financial  periods ended  December 31, 2000,  1999, and 1998
are  disclosed  in footnote 26 to the  financial  statements  contained herein.

Year Ended December 31, 2000 compared to Year Ended December 31, 1999.

The net loss of the  consolidated  entity for the financial year after providing
for  income tax and  eliminating  outside  equity  interests  was  AUD$5,537,576
compared  to a loss of  AUD$11,095,107  for the  previous  financial  year.  The
decrease in operating  loss resulted  primarily by the decrease in the write off
of  exploration  costs of  approximately  AUD$4,800,000,  a decrease  in loss on
disposed  subsidiary  of  AUD$1,200,000,  and a decrease in interest  expense of
approximately  AUD$920,000 because of conversion of debentures in 1999 offset by
an increase  in  selling,  general  and  administrative  costs of  approximately
AUD$1,400,000.

Year Ended December 31, 1999 compared to Year Ended December 31, 1998.

The Company's  gross  revenues for the year ended December 31, 1999 were AUD$208
as compared to AUD$335,980 for the year ended December 31, 1998.

There was no operating  revenue from  operations  in Indonesia for both the year
ended December 31, 1999 and December 31, 1998.

The Company incurred an operating loss before tax of  AUD$11,095,107 in the year
ended December 31, 1999 compared to a loss of  AUD$20,362,087  in the year ended
December 31, 1998.  The decrease in operating  loss resulted  primarily from the
loss on disposal of a subsidiary of AUD$12,673,100 in 1998 offset by an increase
of write-off of exploration expenditures in 1999 of AUD$2,465,587.

                                       28
<PAGE>

The  Company  disposed  of  subsidiaries   engaged  in  unprofitable   ventures,
principally  oil  and  gas  exploration  projects.  All  costs  incurred  by the
subsidiaries  were written off as incurred.  The impact on the Company's  future
results of  operations,  financial  position and  liquidity  resulting  from the
disposal of these subsidiaries will be nil.

The  Company   wrote-off   exploration   costs  of  AUD$4,786,387  in  1999  and
AUD$2,320,000  in 1998.  These costs related to  properties  in  Indonesia.  The
Company  wrote off  these  costs  because  these  areas  were  determined  to be
non-economic because the production costs would exceed any expected revenues.

Dividends

The directors did not recommend the payment of a dividend and no dividends  have
been paid or declared since the end of the previous financial year.

Review of Operations

Although a fairly  extensive  description  of the  operations  of the Company is
included in the Business  overview  which  precedes this report a summary of the
pertinent aspects of those operations is contained in this Item 5.

Energy

On 25 January 2000 agreements  were signed between  CityView and PT Medco Energi
Corporation  TBK ("Medco") by which Medco  undertook the supervision and payment
for  extensive  work under a new works  program  for the Madura and  Simenggaris
blocks in return for it  acquiring  an interest of 75% in each of those  blocks.
The new work program and  accompanying  budget has been agreed between Medco and
Pertamina  (which  is the  Indonesian  state  owned  oil  and  gas  organisation
Perusahaan  Pertambangan  Minyak  Dan  Gas  Bumi  Negara)  as  required  by  the
subscription agreements entered into by CityView and Medco.

                                       29
<PAGE>

The Company holds its interest of 25% in each of those blocks through its wholly
owned  subsidiary  of  CityView  Asia Pty Ltd and  neither  the Company nor that
subsidiary is currently  required to  contribute  towards any of the cost of the
new work programs in developing the Madura and Simenggaris blocks.

Extensive  reappraisal of seismic data and geological  and  geophysical  studies
have been  carried out by Medco on both blocks.  As a result of the  reappraisal
undertaken by Medco it has been decided to slightly  vary the proposed  drilling
locations on the three selected prospects known as Sebaya, Karasan and Pidawan.

As part of the  acquisition of its interest in Block SC41 all  contributions  to
expenses of the current work program of two wells (which  includes Rhino) within
the block will be met on behalf of the Company by MMC  Exploration  & Production
(Philippines)  Pte Ltd which is a  subsidiary  of  Malaysia  Mining  Corporation
Berhad, the largest shareholder of CityView.

The consideration for the acquisition was the issue to ASAB Resources Limited as
vendor of  2,200,000  million  shares in the  capital of the  Company  valued at
US$1,100,000 for each percentage  point interest.  This is a lower rate than the
price paid to CityView by Malaysia Mining Corporation Berhad in December 1999 of
US$1,133,333  for each  percentage  point based on a Gaffney Cline  valuation of
US$17,000,000  for a 15% working  interest in Block SC 41. The interest  sold by
CityView  to  Malaysia  Mining  Corporation  Berhad  in Block SC 41 was not free
carried.

Business to Business E-Commerce

Early in 2000, CityView negotiated an entry into the e-commerce industry through
Sands  Solutions.  As a result the Company  agreed to make  commercial  loans to
Sands Solutions  against the security of a registered  fixed and floating charge
over Sands Solutions with the intention of converting the loans into equity upon
conclusion of an extensive due diligence study and independent valuation. So far
the Company has advanced AUD$3 million to Sands Solutions under the terms of the
loan.

The  outcome  of this  valuation  and the due  diligence  investigations  by the
independent   directors  will  determine  the  level  of  equity  that  CityView
ultimately  acquires  in  Sands  Solutions  and the  price  that it pays for the
acquisition.  As Mr Smyth is a former director of Sands Solutions and his family
trust has a one third equity  interest in that company he is not involved in the
due diligence process.

In November  2000,  expansion to Europe took place through the Company and Sands
Solutions  acquiring a joint  interest of 51% in  Primeorder  AG  ("Primeorder")
which has its headquarters in Hamburg,  Germany. CityView has an interest of 25%
in Primeorder with Sands Solutions holding the balance of 26%. Primeorder AG has
been  established  to market  the  e-commerce  applications  of Sands  Solutions
throughout  Europe.  The marketing  focus of Primeorder AG will be on the unique
interface  of  Sands  Solutions'  Smart  Clips  ("Supply   Management   Advanced
Resourcing  Tools,  Closed Loop  Integrated  Processing  System")  with existing
computer systems.  Particular emphasis will be on the integration of Smart Clips
and SAP R/3.

                                       30
<PAGE>

Min-Tech 8 Limited

The  Company  has  6,270,000  shares and a like  number of options in Min-Tech 8
Limited  ("Min-Tech")  which is an Australian  listed public company  trading on
Australian Stock Exchange Limited under the code MTC.

The products and services  provided by Min-Tech  include high speed and capacity
data transmission  (with band widths for carriage) and connections to mainstream
telecommunications  facilities.  It is  also a  leading  provider  of  microwave
networks for clients including Qantas Airways,  Ansett Australia  Airlines,  the
Victorian Police, Motorola and NEC.

The Company's  investment  in Min-Tech  makes it the second  largest  individual
holder of shares and options.

The  investment  in  Min-Tech  has cost  AUD$701,300  being the  acquisition  of
3,670,000  shares and options in  November  2000 for  AUD$550,500  and a further
2,600,000  shares and options  for  $AUD150,800  in March 2001.  The options are
convertible into fully paid ordinary shares in Min-Tech on or before 31 December
2004 at a price of $AUD0.20 each.

Because of the nature of the investment the directors have valued the holding of
the Company in Min-Tech at cost without any provision for diminution.

Employee Share and Option Benefits

The  shareholders  of the Company at its annual  general  meeting held on 31 May
2000 approved an Employee  Share Plan which  included an Incentive  Option Plan.
The Company has issued  2,000,000 options under the Plan exercisable at $AUD0.80
until 14 June 2001.

Options

At the  date  of  this  report  there  are on  issue  540,000  unlisted  options
convertible  into fully paid  ordinary  shares at an exercise  price of $AUD0.76
each on or before 30 June 2001 and 3,400,000  unlisted options  convertible into
fully paid ordinary shares at an exercise price of $AUD1.62 each on or before 31
December 2001.

In addition,  the Company on 8 November 2000 issued 4,900,000  options to London
Partners Australia Pty Ltd which were exercisable on or before 14 June 2001 at a
price of  $AUD0.80  each.  Of these,  982,500  options  were  exercised  and the
remaining  3,917,500 options were subsequently  cancelled by mutual agreement on
14 February 2001.

                                       31
<PAGE>

The  Company on 16  February  2001 issued  3,500,000  options to London  Broking
Services Pty Ltd  exercisable  on or before 30 April 2001 at a price of $AUD0.70
each but on 1 March 2001 the Company by mutual  agreement with the holder agreed
to cancel 2,000,000 of those options leaving 1,500,000 of those options still on
issue.

On 2 March 2001 the Company  issued to London  Broking  Services Pty Ltd another
2,000,000  options exercisable on or before 31 March 2001 at a price of $AUD0.50
each.

In order to secure the  exercise of these  options for the purposes of providing
additional  capital,  the Company on 16 February  2001 and 1 March 2001  entered
into agreements with London Partners  Australia Pty Ltd under which that company
would procure and ensure that the options would be exercised.  These  agreements
were subject to the price of shares in CityView  remaining at certain  specified
levels which has not been achieved.

In spite of the price of the shares not achieving  those levels London  Partners
Australia  Pty Ltd has arranged the exercise of a total of 1,300,000  options to
raise $AUD650,000 as additional capital.

The directors are presently  negotiating with London Partners  Australia Pty Ltd
to arrange for additional options to be exercised.

Inflationary and other economic pressures

The  Company  is  not  currently  generating  revenues  from  its  oil  and  gas
operations.  Future revenues in this segment are governed primarily by worldwide
commodity  pricing.  No immediate  effect in respect to inflation and changes on
prices  is  expected.  However,  inflationary  pressures  affect  the  Company's
exploration  and  development  expenditure  which is primarily  incurred in U.S.
dollars.  The directors  estimation of inflation is considered in regards to the
general  state of the world  economy,  and of the United States and Indonesia in
particular.  This exposure to  inflationary  pressure is dependent on the mix of
goods and services provided to the Company by suppliers,  sourced  internally in
Indonesia  and  externally.  At this stage the Company is unable to quantify the
mix of inflationary pressures from different sources that will affect the supply
of goods and services to the Company.

The average  official  government  released  Indonesian  inflation rates for the
seven years beginning 1994 were as follows:


                       1994     1995    1996     1997     1998   1999    2000

Inflation Rates %      9.24     8.64    6.47   11.05     77.63   2.01    9.35


                                       32
<PAGE>

It is the policy of the directors to regularly monitor the cost of operations on
a per barrel basis in respect  to  viability  of  individual  projects and  will
take any necessary actions.

The  Company's   operations  in  these  industries   comprise   exploration  and
development expenditure and therefore are not affected by inflationary and price
pressures of oil and gas product pricing.  However, this expenditure is effected
by normal  inflationary  pressures on the Company's general expenditure on goods
and services.

Government Policies

The  Company  has  considered  the issue of  political  risk in the  Republic of
Indonesia in which the Company has acquired assets and will continue to do so as
a matter of normal business  practice.  The Company's expected initial producing
properties  are located in  Indonesia  where  there has been a long  established
petroleum industry, with significant elements of foreign capital investments and
no history of expropriation.

The  Republic  of  Indonesia  is a separate  national  state and like many other
national states regulates,  controls and taxes activities conducted by residents
and non-residents in the country and the flow of investment into the country and
the return of capital out of the country.  All of these controls and regulations
are subject to change from time to time. Some of the interests of the Company in
Indonesia are by way of contract  between a subsidiary of the Company and bodies
which are wholly  owned arms of the  Government  of the  Republic of  Indonesia.
These  contracts  are subject to controls  and  regulations  by the  contracting
parties and by the government of the Republic of Indonesia.  These  factors,  in
addition to the usual  exploration  and  production  risk and the  economic  and
political  stability  of the host  country,  Indonesia  must  all be taken  into
account in relation to the Company's operations in Indonesia.

Other than the effect of the government's  economic fiscal monetary or political
policies of the Republic of  Indonesia,  or factors upon the  operations  of the
Company,  these  policies or factors do not affect  investments by United States
Nationals in Ordinary Shares of the Company.

Likely Developments and Expected Results of Operations

Information  on likely  developments  and  expected  results of  operations  (ie
financial  forecasts  and/or forward looking  information)  of the  consolidated
entity  has  not  been  included  in  this  report  management   considers  such
information to be commercially  sensitive and/or confidential and/or not subject
sufficient certainty.

Indemnification of Officers and Auditors

During the financial  year,  the Company paid a premium in respect of a contract
insuring the directors,  the company secretary and all executive officers of the
Company  and of any related  body  corporate  against a liability  incurred as a
director,  secretary  or  executive  officer  to  the  extent  permitted  by the
Corporations Law. The contract of insurance  prohibits  disclosure of the nature
of the liability and the amount of the premium.

                                       33
<PAGE>

The Company has not otherwise,  during or since the financial year,  indemnified
or agreed to indemnify an officer or director of the Company or any related body
corporate against a liability incurred as an officer or auditor.

                                       34
<PAGE>

B.   Liquidity and capital resources

Year Ended December 31, 2000 compared to Year Ended December 31, 1999

At December 31, 2000, the Company had working capital of AUD$531,613 compared to
a working capital deficit of AUD$2,072,377 at December 31, 1999.

Cash flow used in operating  activities increased from AUD$1,982,595 in the year
ended  December 31, 1999 to  AUD$2,854,435  in the year ended December 31, 2000.
The  primary  differences  for  increase in funds used was for  marketing  fees,
brokerage fees and corporate advisory fees.

Cash flow used for investing increased from AUD$ nil for the year ended December
31, 1999 to  AUD$4,000,147 in the year ended December 31, 2000. This increase in
funds used for investing  activities was primarily due to increased payments for
acquisition,  exploration,  evaluation and development of oil fields.  A loan of
AUD$2,500,000 was advanced to Sands Solutions during the year ended December 31,
2000.

The Company  generated cash flows from financing  activities of AUD$7,679,977 in
the year ended  December 31, 2000  compared to  AUD$1,992,771  in the year ended
December 31, 2000. Cash flows from financing activities principally comprise the
issue of ordinary shares in the Company by private placements and the conversion
of share options into ordinary share capital of the Company.

Year Ended December 31, 1999 compared to Year Ended December 31, 1998.

For the year  ended  1999  the  Company  agreed  to allot  75%  interest  in its
Indonesia oil and gas properties to Medco,  in  consideration  of Medco carrying
out and  paying  for the new work  programs.  Accordingly,  the  Company  has no
planned  expenditures  for its Indonesian oil and gas properties for fiscal 2000
and 2001.

At  December  31,  1999,  the  Company  had a working  capital  deficit  of AUD$
2,072,377  compared to  AUD$15,431,298  at December 31, 1998.  This  decrease in
working capital deficit resulted mainly from the settlement of debt to MMC.

Cash flow used in operating  activities decreased from AUD$2,495,512 in the year
ended December 31,1998 to AUD$1,982,595 in the year ended December 31, 1999. The
primary  differences  for  decrease  in funds  used was due to the slow  down of
activity, mainly in Jakarta.

Cash flow used for investing  decreased  from  AUD$9,402,910  for the year ended
December 31, 1998 to AUD$ nil in the year ended December 31, 1999. This decrease
in funds used for investing  activities was primarily due to decreased  payments
for acquisition,  exploration,  evaluation and development of oil fields. Due to
oil prices during 1998/1999  exploration  expenditure was cut back and a greater
emphasis placed on reducing debt and restructuring the Company primarily through
agreement with Medco.

                                       35
<PAGE>

The Company  generated cash flows from financing  activities of AUD$1,992,771 in
the year ended  December 31, 1999 compared to  AUD$10,022,062  in the year ended
December 31, 1998. Cash flows from financing activities principally comprise the
issue of ordinary shares in the Company by private placements and the conversion
of share  options  into  ordinary  share  capital of the  Company and loans from
related party of AUD$5,951,600 in 1998.

For the  period  from  December  31,  1999  through  June 2000,  AUD$660,000  of
debentures  were  converted  into  shares  capital.   The  Company  also  raised
additional  equity capital of AUD$9,808,000  and  AUD$1,662,000 of proceeds were
received from the exercise of options. Accordingly, working capital increased by
AUD$12,130,000 as a result of these transactions.

C.   Research and development, patents and licences
Not applicable

                                       36
<PAGE>

D.   Trend information
Not applicable

                                       37
<PAGE>

ITEM 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES.

A.   Directors and senior management

Name                               Age      Position

Peter Mark Smyth                   61       Chief Executive Officer and Director

Peter John Augustin Remta          59       Director and Chairman of the
                                             independent audit committee

Leslie Robert Maurice Friday       63       Director and member of the
                                             independent audit committee

Warren Martin Baillie              29       Secretary, Chief Financial Officer
                                             and General Counsel and member of
                                             the independent audit committee

All directors hold office until the next annual general  meeting of shareholders
and until their  successors  have been  elected  and  qualified.  The  Company's
officers are elected by the Board of Directors  after each annual meeting of the
Company's shareholders and hold office until their death, resignation or removal
from office.

Directors

The names and  particulars  of the directors of the Company in office during and
since the end of the financial year are:

Peter Mark Smyth - Chief Executive Officer

Mr Smyth holds a masters degree in jurisprudence from Oxford  University.  After
admission as an attorney in London,  he worked for Arthur Andersen in Sydney and
then Price  Waterhouse  as a taxation  specialist.  In 1969 Mr Smyth  became the
company  secretary and treasurer of the Australian branch of the Selection Trust
Group (now BP  Minerals).  Since leaving  Selection  Trust some 25 years ago, Mr
Smyth has founded  and  developed a number of  successful  companies  in various
parts of the world.  He has been Chief Executive of CityView since 1996 and is a
non-executive director of Sands Solutions.

Peter John Augustin Remta - Chairman

Mr Remta  practiced  as a lawyer for many years in the fields of  corporate  and
mining law. He has  extensive  experience  in the  direction  and  management of
public  companies  and was  appointed a director  of CityView on 6 May 1987.  Mr
Remta was for some time the  Honorary  Consul  General  for the  Philippines  in
Western Australia and has held a number of public company  directorships.  He is
chairman of the Company's independent audit committee.

Leslie Robert Maurice Friday

Mr  Friday  has  extensive  business  interests  and a  long  record  of  proven
investments.  He founded and for many years ran a large and successful  property
development and home building group which was regarded as an industry leader. By
the  time Mr  Friday  sold the  group it had  started  expanding  into  property
developments  in Asia as well as  throughout  Australia.  He has  served  on the
governing bodies of building and industry organizations and other company boards
involving various business and investment  activities.  Mr Friday was a director
of CityView from May 1987 to September 1996 and was  reappointed a director on 1
January 2000. He is a member of the Company's independent audit committee.

                                       38
<PAGE>

Warren Martin Baillie - Secretary, Chief Financial Officer and General Counsel ^
Mr.  Baillie's  experience  has been in both  financial  and  legal  arenas.  He
recently  practiced as an attorney in the areas of commercial  and corporate law
with the large  independent law firm Jackson  McDonald.  He has also worked with
the  Perth  office  of  Ernst &  Young,  Chartered  Accountants.  Mr.  Baillie's
qualifications  include a Bachelor of Commerce  degree  from the  University  of
Western  Australia  and a Bachelor  of Laws degree from  Murdoch  University  of
Western Australia.  He is a member of the Company's  independent audit committee
and was appointed Secretary,  Chief Financial Officer and General Counsel of the
Company in May of 2000.

All of the above  officers  have been in office since the start of the financial
year to the date of this report.

[Peter Remta and Mark Smyth will advise which profile they want included in 2000
20F]

B.   Compensation

Remuneration of Directors

The remuneration of all directors is determined and reviewed on a periodic basis
and  appropriate  recommendations  are made to the board of  directors.  In each
instance  the  remuneration  is  assessed  with  regard  to  the  nature  of the
remuneration  and the  performance  of the  recipient  together  with all  other
relevant  factors with the overall  objective of achieving  maximum benefits for
shareholders by providing  sufficient  expertise and experience within the board
and executive officers.

The  remuneration  is  made up of  several  elements  including  base  fees  and
salaries,  incentive  benefits  (including the Incentive Option Plan established
under the Employee Share Plan) and other general  benefits  covering  travel and
vehicle expenses and similar outgoings.

The remuneration for each director for the financial year (inclusive of benefits
to associated or related parties) was :

  Name              Base fee               Other fees           Incentives
                    $                      $                    (Options)
  P M Smyth         10,000                 213,825  (1)         700,000
  P J A Remta       10,000                  41,090              500,000
  L R M Friday      10,000                 -                    200,000

(1)      See also Item 7B hereinafter.

                                       39
<PAGE>

Mr P M Smyth is an  executive  director  of the  Company  while  the  other  two
directors are non- executive.

The options  accruing to the directors were issued under the Employee Share Plan
and have  been  valued at 37 cents  each  using the  Black  Scholes  Model.  The
Company's Employee Share Plan is described in Item 6.E.

No amount  of money has been set aside by the  Company  to  provide  pension  or
similar benefits for its officers and directors.

C.   Board practices

The  board of  directors  resolved  on 14 June  2000 to  formalize  the terms of
reference  of the board audit  committee.  The board has adopted a formal  audit
charter  with the primary  objective of assisting  the board in  fulfilling  its
responsibilities  to  shareholders,  potential  shareholders  and the investment
community relating to accounting and reporting  practices of the Company and its
present or future  subsidiaries  and the quality and  integrity of the financial
reporting.

D.   Employees

At December  31, 2000 the Company had 5 full time  employees  at its  registered
office in Australia.  Much of the Company's work is undertaken by consultants on
a per diem basis.

E.   Share ownership

See Item 7A Major shareholders

Employee Share Plan

The Company has an Employee Share Plan (which includes an Incentive Option Plan)
that was approved by  shareholders  at the Annual General Meeting held on 31 May
2000.

On 14 June  2000 the  Company  issued a total of  2,000,000  options  under  the
Incentive  Option Plan forming part of the Employee Share Plan.  During the year
there were no more than ten eligible  participants  for the Employee Share Plan.
The options  were issued as a  performance  incentive  for no  consideration  to
eligible  employees  under the  Incentive  Option  Plan.  Each of these  options
confers the right to acquire one (1) ordinary fully paid share in the capital of
the Company at a price of AUD$0.80  each on or before 14 June  2001.  All of the
options remained unexercised and on issue as at 31 December 2000.

                                       40
<PAGE>

Of the total  number of options  issued,  700,000  options were issued to Mr P M
Smyth,  500,000  options were issued to Mr P J A Remta and 200,000  options were
issued to Mr L R M Friday.  In addition  500,000 options were issued on trust to
Messrs Friday and Remta for future  distribution  to employees at the discretion
of the directors.

                                       41
<PAGE>

ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS.

A.   Major shareholders

The following table sets forth the Ordinary Share ownership of each person known
by the  Company  to be the  beneficial  owner  of ten  percent  or  more  of the
Company's shares,  each director and officer  individually and the directors and
officers  as a group.  Each  person has sole  voting and  investment  power with
respect  to  the  shareholdings  shown  and  all  ownership  is  of  record  and
beneficial.

Name and address                    Number of     Position            Percent of
of owner                            Shares                                Class
--------------------------------------------------------------------------------


Peter Mark Smyth                    196,084     Director and
19 View Street                                  Chief Executive               *
Peppermint Grove 6011                           Officer
Western Australia

Peter John Augustin Remta           66,233      Non executive Director        *
34 Karoo Street
South Perth 6151
Western Australia

Leslie Robert
Maurice Friday                      74,590      Non executive Director        *
1/24 Marjorie Avenue
Shelley
Western Australia

Warren M Baillie                    12,000      Secretary/General Counsel/    *
3 Bennetts Place                                 Chief Financial Officer
Sorrento      6020
Western Australia

                                       42
<PAGE>


Malaysia Mining Corporation
Corporation Berhad.
32nd Floor, Menara PNB
201A Jalan Tung Razak
Kuala Lumpur 50400
Malaysia                            8,616,188 (1                         17.67 %

All officers and directors
as a group (4 persons)                                                        *

(1) Includes an  additional  6,624,790  Ordinary  Shares issued on July 11, 2000
subject  to  an  irrevocable  contractual  agreement  made  to  Malaysia  Mining
Corporation Berhad for consideration received.

Based on 48,764,516 shares outstanding as of March 16, 2001.

* Represents less than 1%

B.   Related party transactions
Mr P M Smyth's family trust has a one-third  equity interest in Sands Solutions.
The Company made a loan of AUD$2,500,000 to Sands Solutions  during the year and
has charged Sands Solutions interest on that loan at 7%.

On 1 February  2001 and 10 April 2001 the Company  advanced  further  amounts of
AUD$250,000 to Sands Solutions under the existing loan  arrangements, increasing
the loan to Sands Solutions to AUD$3 million.

Mr P M Smyth is a director and shareholder of Romarcam  Investments Pty Ltd. The
Company has entered into a contract with Romarcam  Investments  Pty Ltd dated 19
April  1999 for the  provision  of  management  services.  Fees paid  during the
financial  year  at  normal  commercial  rates  were  AUD$213,825   compared  to
AUD$180,000 in the previous year.

Mr P J A Remta is an  employee  and  members of his family are  shareholders  of
Westchester Pty Ltd which provides consultancy and corporate management services
to the  Company  under a  consultancy  agreement  reduced to writing and dated 1
February 2001.  Fees paid during the financial year at normal  commercial  rates
were AUD$41,090.

There are no additional  interests of management  in  transaction  involving the
Company  except  for  those  stated  herein  or in Item 17-  notes to  financial
statements.

C.   Interests of experts and counsel
     Not applicable

                                       43

<PAGE>

ITEM 8.  FINANCIAL INFORMATION.

A.   Consolidated Statements and Other Financial Information

Reference is made to "Item 17. Fiancial Statements" for the financial statements
included in this annual report.

Legal proceedings

The Company is not a party to any litigation  and to its  knowledge,  no action,
suit or proceedings against it has been threatened by any person or firm.

A  claim   asserted  by   Consolidated   Securities  SA  ("CSSA")  for  fees  of
(pound)78,795.62 (AUD$196,841.42) was  settled  on  September  21,  2000  and in
accordance  therewith the Company was required to issue and did issue 104,000 of
its ordinary  shares to CSSA and in addition  was  required to and has paid,  on
September 21, 2000,  CSSA the sum of US$65,630.  As a result,  a District  Court
Order dismissing such action was filed on October 12, 2000.

To date, the Compnay has not paid a dividend.  The declaration, amount, and date
of distribution o fany dividend in the future will be decided by  the  Board  of
Directors from time to time based upon and subject to  the  Company's  earnings,
financial requirements, and other conditions prevailing at the time.

B.   Significant changes

On 1 February 2001 and 10 April 2001 the Company advanced amounts of AUD$250,000
to Sands  Solutions  under  the loan  arrangements  heretofore  disclosed  which
increased the loan to Sands Solutions to AUD$3,000,000.

On 14  February  2001  the  Company  by  agreement  with the  holders  cancelled
3,917,500  options which were  exercisable at AUD$0.80 each on or before 14 June
2001 and on 16 February 2001 it issued another 3,500,000 options  exercisable at
AUD$0.70 each on or before 30 April 2001.

On 1 March 2001 a total of  2,000,000  of these new options  were  cancelled  by
agreement  between  the  Company and the holders and on 2 March 2001 the Company
issued another  2,000,000  options  exercisable at AUD$0.50 each on or before 31
March 2001.

As a result of these  transactions a total of 1,300,000 options has already been
exercised since 31 December 2000 to raise AUD$650,000 as working capital for the
Company.

These transactions were entered into for the purposes of enabling the Company to
raise  additional  working  capital at prices more  reflective of the prevailing
market price of its shares.

The  financial  effects  of the  transactions  referred  to in this item will be
included in the Company's accounts for the year ended 31 December 2001.

                                       44
<PAGE>
ITEM 9.  THE OFFER AND LISTING.

Not applicable

ITEM 10.  ADDITIONAL INFORMATION.

A.   Share capital
     Not applicable

B.   Memorandum and articles of association
     This information has been previously provided.

C.   Material contracts

Primeorder AG
In November 2000 the Company  entered an agreement  with Sands  Solutions  under
which the Company  acquired a beneficial  interest of 25% in Primeorder AG which
is a marketing company established in Hamburg,  Germany to market the e-commerce
applications of Sands  Solutions  throughout  Europe.  Sands Solutions has a 26%
interest in Primeorder AG.

As partial  consideration  for the  Company's  interest  in  Primeorder  AG, the
Company agreed to lend up to AUD$2,000,000  to Sands Solutions.  This money will
be used for the  establishment and promotion of Primeorder AG. The extent of the
payments  and when they  will be made to  satisfy  the loan  will  depend on how
rapidly  Primeorder  AG expands its business in Europe.  The Company has already
advanced  AUD$332,251  to  Sands  Solutions  for use by  Primeorder  AG with the
advance forming part of the loan disclosed herein.

As further  consideration  for the acquisition of its interest in Primeorder AG,
the Company  issued  500,000  options in November 2000 to persons in Germany who
are associated with  Primeorder AG. The options are convertible  into fully paid
ordinary shares at an exercise price of AUD$0.80 each on or before 14 June 2001.

Petroleum Permit Block SC41 - offshore Western Philippines
On 30 June 1999  CityView's  wholly  owned  subsidiary,  CityView  Asia Pty Ltd,
executed an agreement with Malaysia  Mining  Corporation  Berhad ("MMC") for the
transfer  of  the  Company's  49%  interest  in  MMC  Exploration  &  Production
(Philippines)  Pte  Ltd  ("MMCEPPL")  in  full or  partial  satisfaction  of the
Company's then  outstanding debt to MMC and to discharge the Deed of Charge of 4
February  1998.  At the  general  meeting of the  Company's  shareholders  on 30
December 19999,  the  shareholders  approved the sale and the Deed of Charge was
discharged on 24 January 2000.

In April 2000 the Company, through its subsidiary CityView Asia Pty Ltd, entered
an agreement  to acquire an interest of 2.5% in Block SC 41 from ASAB  Resources
Limited.  As part of this  acquisition  all  contributions  to  expenses  of the
current work program of two wells (which  includes  Rhino) within the block will
be met  on  behalf  of  the  Company  by  MMCEPPL.  The  consideration  for  the
acquisition  was the issue to ASAB  Resources  Limited  as  vendor of  2,200,000
million  shares in the capital of the Company  valued at  US$1,100,000  for each
percentage point interest.  This is a lower rate than the price paid to CityView
by MMC in 1999 of  US$1,133,333  for each  percentage  point  based on a Gaffney
Cline  valuation  of  US$17,000,000  for a 15% working  interest in Block SC 41.
Additionally  the  interest  sold by CityView to MMC in Block SC 41 was not free
carried.

Indonesia - Madura and Simenggaris
25 January 2000,  agreements were signed between the Company and PT Medco Energi
Corporation  Tbk ("Medco") in respect of the Madura and  Simenggaris  Production
Sharing  Contracts.  Under these agreements Medco will supervise and pay for the
new work programs for the  development  and bringing into  production of the oil
and gas files covered by these contracts. The Company anticipates that from 2002
onwards each party will  contribute on a pro-rata basis in accordance with their
interests in each PSC, which are Medco 75% and CityView 25%.

Sands Solutions
In 2000 a heads of agreement was entered  between  CityView and Sands  Solutions
under which  CityView  acquired  the rights to take up a  strategic  interest in
Sands Solutions, a developer of integrated B2B applications.  Under the terms of
the  heads of  agreement,  CityView  agreed to make a  commercial  loan to Sands
Solutions  with the right to convert  the loan into equity  upon  conclusion  of
extensive due diligence and an independent valuation.

Raeside Gold project
CityView's  former  subsidiary  Copperwell  Pty  Ltd had a 10%  interest  in the
Raeside  Gold  Project  located  approximately  10km east of  Leonora in Western
Australia  covering an area of 168 square  kilometers.  In consideration for the
discharge  of all  outstanding  liabilities  for the Raeside  project,  CityView
entered an agreement on 5 November  1999 with Triton  Resources  Limited to sell
its subsidiary Copperwell Pty Ltd to Triton Resources Limited.

Artane Minerals NL
CityView's former subsidiary Artane Minerals NL had a 97% interest in the Golden
Spinifex and some adjoining  tenements at Duketon which have been joint ventured
to Johnson's  Well Mining NL. On 1 December 1999  CityView  entered an agreement
with Yule River  Mining Pty Ltd to sell its  interest  in Artane  Minerals NL to
Yule River Mining Pty Ltd.
                                      44(A)
<PAGE>
D.   Exchange controls

Exchange controls and other limitations affecting security holders

Australia has largely abolished  exchange  controls on investment  transactions.
The  Australian  dollar is freely  convertible  into US dollars  except that all
payments  and cash  transactions  in excess of $5,000 to  non-residents  must be
reported  to the  Australian  Cash  Transactions  Agency,  which  monitors  such
transactions,  whether  they  be in the  form of  cash,  dividends,  capital  or
profits.

The Foreign  Acquisitions  and Takeovers Act ("Foreign  Acquisitions  Act") sets
forth limitations on the rights of  non-Australian  residents to own or vote the
ordinary shares of an Australian company.  The Foreign  Acquisitions Act permits
the Commonwealth  Treasurer to examine  acquisitions and arrangements that could
result in foreign persons controlling an Australian  business.  The Commonwealth
Treasurer  may  prohibit  a  proposed  takeover  if it would lead to a change of
control of a business where the resultant control would be foreign and therefore
considered to be against the national  interest.  The Foreign  Acquisitions  Act
contains  divestiture  provisions  to  ensure  it can be  enforced,  as well as,
stringent  monetary-penalty  provisions  for breaches and the making of false or
misleading statements.

The Foreign  Acquisitions  Act requires the prior  approval of the  Commonwealth
Treasurer  for certain  classes of persons to enter into an agreement to acquire
shares of an  Australian  company,  if,  after the  acquisition,  such person or
corporation would hold a substantial interest in such corporation,  as explained
herein. The foregoing approval  requirement  applies to the following classes of
persons:  (i) any natural person not ordinarily resident in Australia,  (ii) any
corporation  in  which  either a  natural  person  not  ordinarily  resident  in
Australia or a foreign corporation (as defined in the Foreign  Acquisitions Act)
holds a substantial interest, and (iii) two or more such persons or corporations
which hold an aggregate substantial interest.

                                       45
<PAGE>

The Foreign  Acquisitions  Act requires  foreign  persons or  foreign-controlled
entities  to give  forty (40) days  notice to the  Commonwealth  Treasurer  of a
proposal  to acquire or  increase  (or offer to  acquire or  increase)  a single
interest  of 15% or more of the  ownership  or  voting  power  of an  Australian
company.  If two or more  foreign  persons or  foreign-controlled  entities  are
acting together, the threshold is 40% in the aggregate.

The Constitution of the Company does not contain any additional limitations on a
non-resident's right to hold or vote the Company's securities.

E.   Taxation

The following  discussion  summarizes US federal and Australian tax consequences
of the ownership of Shares by a person ("US Portfolio Stockholder") that: (i) is
a citizen or  resident of the US, a US  corporation  or that  otherwise  will be
subject to US federal income tax on a net income basis in respect of the Shares;
(ii) is not a resident of Australia for Australian tax purposes;  (iii) has not,
within the preceding five years, beneficially owned 10% of the issued capital or
voting stock in the Company;  and, (iv) has not used the Shares in carrying on a
trade or  business,  wholly  or  partly  through a  permanent  establishment  in
Australia.

The  statements  regarding US and Australian tax laws set forth herein are based
on those laws as in force on the date of this  document  that may affect the tax
consequence  described herein (some of which may have retroactive effect).  This
summary is not  exhaustive of all possible tax  consideration  and investors are
advised to satisfy  themselves  as to the  overall tax  consequences,  including
specifically  the  consequences  under US,  state,  local and other laws, of the
acquisition,  ownership and  disposition  of Shares by consulting  their own tax
advisers.

Taxation of Gains on Sale

A US Portfolio  Stockholder is not subject to Australian  income tax on the sale
of its Shares in the Company.

Passive Foreign Investment Company Status

A foreign  corporation is classified as a passive foreign  investment company (a
"PFIC") in any taxable  year in which,  after taking into account the income and
assets of certain  subsidiaries  pursuant to the applicable US Internal  Revenue
Code  "look-through"  rules,  either  (i) at least  75% of its  gross  income is
passive  income,  or (ii) at least  50% of the  average  value of its  assets is
attributable  to assets  that  produce  passive  income from cash  holdings  and
profits from the sale of marketable  securities,  even if derived from an active
business.

                                       46
<PAGE>

If the Company were a PFIC during any year in which a US  Portfolio  Stockholder
owned Shares, that US Portfolio Stockholder would be subject to additional taxes
on any gain realized from the sale or any other  disposition  of the Shares,  or
any excess distribution received from the Company.

A US Portfolio  Stockholder will have an excess  distribution to the extent that
distributions  on Shares  during a taxable  year  exceeded  125% of the  average
amount received during the three preceding taxable years (or, if shorter, the US
Portfolio  Stockholders'  holding period for the Shares).  To compute the tax on
gain or on an excess  distribution,  (i) the excess  distribution or the gain is
allocated  ratably over the US Portfolio  Stockholder's  holding  period for the
Shares,  (ii) the amount  allocated  to the current  taxable year at the highest
applicable marginal rate in effect for each year and (iii) an interest charge is
imposed  to recover  the deemed  benefit  from the  deferred  payment of the tax
attributable to each year.

If the Company is a PFIC, US persons that own an interest in another entity that
owns  shares  in the  Company  may be  treated  as  indirect  holders  of  their
proportionate  share  of  that  entity's  Shares,  and  may be  taxed  on  their
proportional  share  of  any  gain  or  excess  distribution  from  that  entity
attributable  to the entity's in the Company.  A US person that owns an interest
in the entity that is an actual  holder of Shares will be treated as an indirect
holder if (i) the actual  holder is itself a PFIC,  (ii) the actual  holder is a
foreign  corporation  other  than a PFIC in  which  the US  person  who  owns an
interest in the actual  holder owns  (directly  or  indirectly)  at least 50% in
value  of  the  actual  holder's  shares,  or  (iii)  the  actual  holder  is  a
partnership,  trust or estate in which the US Portfolio Stockholder is a partner
or  beneficiary.  An  indirect  holder  must take into income its portion of any
excess distribution  received by the actual holder or any gain recognized by the
actual holder on the Shares.  An indirect  holder also must treat an appropriate
portion of its gain on the sale or  disproportion  of its interest in the actual
holder  as gain on the sale of the  Shares.  If the  Company  were a PFIC,  a US
Portfolio Stockholder of Shares would generally be subject to similar rules with
respect to  distribution  by, and  dispositions  of the shares of, any direct or
indirect subsidiaries of the Company that were PFICs.

The  Internal  Revenue  Code  provides  each US  stockholder  in an PFIC with an
election  whereby the  additional US tax burden  imposed on gain on sale of PFIC
stock and receipt of excess  distributions  from a PFIC, as described above, can
be avoided.  This election generally requires that the PFIC stockholder  include
in its income,  its pro-rata share of the PFICs  distributed  and  undistributed
income, as computed under US tax accounting principles,  on an current basis. In
certain cases, a further  election is available to an electing PFIC  stockholder
to defer the tax payable with respect to the stockholder's pro-rata share of the
PFICs  undistributed  income,  although  in this case  interest  applies  on the
deferred tax. Thus,  even if the first or both of these elections are made, a US
stockholder of a PFIC loses the tax benefit,  which is available with respect to
investment in a non-PFIC  corporation,  of deferring  and  converting to capital
gain the  investor's  personal US tax  liability  with respect to the  Company's
undistributed  income.  These  elections  also  generally  require that the PFIC
annually provide the electing PFIC  shareholder,  for inspection by the Internal
Revenue  Service,  an  analysis  of  the  PFICs  income  computed  under  US tax
accounting principals.

                                       47
<PAGE>

The Company  does not intend to furnish any US  Portfolio  Stockholder  with the
information  that it  would  need in order  to  avoid  the  PFIC  tax  treatment
described by electing to include its share of the Company's  income on a current
basis.  Therefore  these  elections  may not be  available  to the  Company's US
Portfolio Stockholders.

There are other adverse US tax rules associated with holding Shares in a company
that has been a PFIC  during  any part of a US  Portfolio  Stockholders  holding
period.  These include a denial of a step-up in a tax basis on the death of a US
individual stockholder, and burdensome reporting requirements.

If the Company  ceases to be a PFIC,  a US Portfolio  Stockholder  may avoid the
contained  application  of the tax treatment  described  above by electing to be
treated  as if it sold its  Shares on the last day of the last  taxable  year in
which the Company was a PFIC.  Any gain is recognized and subjected to tax under
the  rules  described   above.   Loss  is  not  recognized.   The  US  Portfolio
Stockholder's  basis in the Shares is increased by the amount of gain recognized
on the deemed sale. This election is not available to a US Portfolio Stockholder
that  previously  elected  to  include  its share of the  Company's  income on a
current basis.  The US Congress  recently has considered  legislation that would
alter the PFIC rules substantially.  Prospective  investors should consult their
own tax advisors as to the potential  application of the PFIC rules, as well as,
the impact of any proposed legislation that could affect them.

Taxation of Dividends

The Company does not expect to pay cash  dividends for the  foreseeable  future,
but, rather, to retained earnings, if any, to finance expansion of its business.
Should the Company begin paying dividends,  however,  the Company's dividends to
its  US  Portfolio   Stockholders  would  be  exempt  from  Australian  dividend
withholding  tax to the extent such dividends are considered to be "franked" for
Australian tax purposes.  A dividend is considered to be "franked" to the extent
that such  dividend  is paid out of the  Company's  income  on which  Australian
corporate tax has been levied.  Even if not "franked," a dividend will be exempt
from  Australian  dividend  withholding  tax if it is paid out of the  Company's
non-Australian  source  dividend  income and the  Company  specifies  a "foreign
dividend  account  declaration   percentage"  for  such  purpose.   The  Company
anticipates  that if it pays  dividends,  such dividends  would likely be either
"franked," or paid from the Company's  non-Australian  source dividend income as
specified in the foreign dividend account declaration percentage,  and therefore
would be exempt from Australian dividend withholding tax.

                                       48
<PAGE>

If, however,  dividends are paid by the Company that are not "franked," nor paid
from the initial Company's non-Australian source dividend income as specified in
the foreign dividend account declaration percentage, such dividend would then be
subject to Australian dividend  withholding tax. However, in accordance with the
provisions  of  the  Australia/United  States  Income  Tax  Treaty,   Australian
withholding tax on dividend income derived by a US stockholder  would be limited
to 15% of the gross amount of the dividend. Subject to certain limitations,  any
Australian  dividend  withholding  tax may be  claimed as a credit  against  the
federal income tax liability of the US  stockholder.  The overall  limitation on
non-US taxes  eligible for US credit is  calculated  separately  with respect to
specific  classes,   or  "baskets"  of  income.  For  this  purpose,   dividends
distributed by the Company will generally constitute "passive income" or, in the
case of certain US Portfolio Stockholder, "financial service income." The US tax
credits  allowable  with  respect to each  income  basket  cannot  exceed the US
federal income tax payable with respect to such income.  The consequences of the
separate limitation calculation will depend on the nature and sources of each US
Portfolio Stockholder's income and the deductions allocable thereto.

Distributions on the Shares will constitute  dividends for US Federal income tax
purposes to the extent paid out of current or accumulated  earnings and profits,
if any of the Company, as determined for US federal income tax purposes.  If the
Company  pays a  dividend,  such  dividend  would  likely be paid in  Australian
dollars.  The amount of dividend income for a US Portfolio  Stockholder  will be
the US dollar value of the dividend payment on the date of receipt,  even if the
dividend is not converted  into US dollars Gain or loss,  if any,  realized on a
sale or other disposition of Australian  Dollars will be ordinary income or loss
to the US  Portfolio  Stockholder.  Dividends  paid by the  Company  will not be
eligible for the  "inter-corporate  dividends  received" deduction allowed to US
corporations.

Estate and Gift Tax

Australia does not impose any estate,  inheritance or gift taxes.  Therefore, no
Australian estate tax,  inheritance tax or gift tax will be imposed on the death
or upon a lifetime gift by, a US Portfolio Stockholder.

F.   Dividends and paying agents
     Not applicable

G.   Statement by experts
     Not applicable

H.   Documents on display

Persons  having  a right  of  inspection  of the  Company's  records  under  the
Australian  corporations and securities  legislation can inspect such records by
contacting  the  Company's  registered  office at 63  Burswood  Road,  Burswood,
Western  Australia,  Telephone:  (61 8) 6250 9099, Fax: (61 8) 6250 9088, email:
info@cityviewcorp.com.

                                       49
<PAGE>

I.   Subsidiary information
     Additional information not applicable

ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable

ITEM 12.  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES.

A.   Debt securities
     Not applicable

B.   Warrants and rights
     Not applicable

C.   Other securities
     Not applicable

D.   American depositary shares
     Not applicable

                                       50

<PAGE>

                                     PART II

ITEM 13.  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES.

Not applicable


ITEM 14.  MATERIAL  MODIFICATIONS  TO THE RIGHTS OF SECURITY  HOLDERS AND USE OF
PROCEEDS.

Not applicable

E.   Use of proceeds

     Not applicable

ITEM 15.  [RESERVED]



ITEM 16.  [RESERVED]


                                     PART IV

ITEM 17.  FINANCIAL STATEMENTS.

                       CITYVIEW ENERGY CORPORATION LIMITED
                                 ACN 009 235 634

           Annual Report For The Financial Year Ended 31 December 2000




                                                                 Page Number

Auditors' Report                                                    F-2

Profit and Loss Statement                                           F-4

Balance Sheet                                                       F-5

Statement of Cash Flows                                             F-6

Notes to and forming Part of the Financial Statements             F-7-F-26







                                      F-1

<PAGE>


                           INDEPENDENT AUDITORS' REPORT

Board of Directors and Shareholders
CityView Corporation Limited

        We have audited the accompanying consolidated balance sheets of CityView
Corporation   Limited  as  of  December  31,  2000  and  1999  and  the  related
consolidated  statements of profit and loss,  and cash flows for the years ended
December  31,  2000,  1999,  and  1998.  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 audit.

         We   conducted  our  audit  in  accordance with United States generally
accepted  auditing  standards.  Those standards require that we plan and perform
the audit to obtain reasonable  assurance about 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,  the  financial  statements  referred to above  present
fairly, the consolidated  financial position of CityView  Corporation Limited as
of  December  31, 2000 and 1999 and the  consolidated  results of its profit and
loss and its cash flows for the years ended December 31, 2000,  1999 and 1998 in
conformity with Australian generally accepted accounting principles.



                                                 /s/Feldman Sherb & Co, P.C.
                                                    Feldman Sherb & Co., P.C.
                                                    Certified Public Accountants

New York, New York
May 23, 2001


                                       F-2
<PAGE>

The accompanying financial statements have been prepared in accordance with
Australian generally accepted accounting principles.


                                       F-3
<PAGE>
                          CITYVIEW CORPORATION LIMITED
                            PROFIT AND LOSS STATEMENT
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000




<TABLE>
<CAPTION>


                                                                  Consolidated Entity                       Parent Entity
                                                                31-Dec-00     31-Dec-99     31-Dec-98    31-Dec-00   31-Dec-99
                                                        NOTE       AUD$          AUD$          AUD$          AUD$       AUD$


<S>                                                      <C>     <C>           <C>          <C>             <C>         <C>
Operating profit (loss) before income tax                2       (5,537,576)  (11,095,107) (20,362,087) (5,506,962) (10,505,250)

Income tax attributable to operating profit (loss)       3                -             -            -           -            -
                                                              -------------- ------------- ------------ ----------- ------------

Operating profit (loss) after income tax                         (5,537,576)  (11,095,107) (20,362,087) (5,506,962) (10,505,250)

Outside equity interests in operating profit (loss)                       -             -            -           -            -
                                                              -------------- ------------- ------------ ----------- ------------

Operating profit (loss) after income tax
   attributable to members of the parent entity                  (5,537,576)  (11,095,107) (20,362,087) (5,506,962) (10,505,250)

Accumulated losses at the beginning of the
   financial year                                               (39,399,202)  (28,304,095)  (7,942,008)(39,429,816) (28,924,566)
                                                              -------------- ------------- ------------ ----------- ------------

Accumulated losses at the end of the                            (44,936,778)  (39,399,202) (28,304,095)(44,936,778) (39,429,816)
                                                              ============== ============= ============ =========== ============
   financial year

</TABLE>





      Notes to and forming part of the financial statements are included on
                               pages F-7 to F-26.

                                       F-4


<PAGE>


                          CITYVIEW CORPORATION LIMITED
                                  BALANCE SHEET
                                31 DECEMBER 2000

<TABLE>
<CAPTION>

                                                                           Consolidated Entity                   Parent Entity
                                                                         31-Dec-00      31-Dec-99        31-Dec-00     31-Dec-99
                                                               NOTE         AUD$           AUD$             AUD$          AUD$



<S>                                                                     <C>             <C>            <C>                <C>
CURRENT ASSETS
Cash                                                                       822,559         11,679         822,551             -
Receivables                                                      7               -          4,115               -             -
                                                                   -------------------------------     -----------------------------

TOTAL CURRENT ASSETS                                                       822,559         15,794         822,551             -
                                                                   -------------------------------     -----------------------------

NON CURRENT ASSETS
Receivables                                                      8      10,225,105              -      14,845,105     7,442,800
Investments                                                      9         550,500              -         550,510            10
Property, plant and equipment                                   10           9,723              -           9,723             -
Acquisition, exploration and development                        11       4,620,002      7,563,651               -             -
                                                                   -------------------------------     -----------------------------

TOTAL NON CURRENT ASSETS                                                15,405,330      7,563,651      15,405,338     7,442,810
                                                                   -------------------------------     -----------------------------

TOTAL ASSETS                                                            16,227,889      7,579,445      16,227,889     7,442,810
                                                                   -------------------------------     -----------------------------

CURRENT LIABILITIES
Accounts payable                                                12         290,946      1,419,561         290,946     1,310,169
Borrowings                                                      13               -        668,610               -       671,981
                                                                   -------------------------------     -----------------------------

TOTAL CURRENT LIABILITIES                                                  290,946      2,088,171         290,946     1,982,150
                                                                   -------------------------------     -----------------------------

TOTAL LIABILITIES                                                          290,946      2,088,171         290,946     1,982,150
                                                                   -------------------------------     -----------------------------

NET ASSETS/(LIABILITIES)                                                15,936,943      5,491,274      15,936,943     5,460,660
                                                                   ===============================     =============================

SHAREHOLDERS' EQUITY
Share capital                                                   14      60,873,721     44,890,476      50,318,271    44,890,476
Reserves                                                        15               -              -               -             -
Accumulated losses                                                     (44,936,778)   (39,399,202)    (34,381,328)  (39,429,816)
                                                                   -------------------------------     -----------------------------
Shareholders' equity attributable to the
members of the parent entity                                            15,936,943      5,491,274      15,936,943     5,460,660
                                                                   -------------------------------     -----------------------------

TOTAL SHAREHOLDERS' EQUITY/(DEFICIT)                                    15,936,943      5,491,274      15,936,943     5,460,660
                                                                   ===============================     =============================
</TABLE>


   Notes to and forming part of the accounts are included on pages F-7 to F-26

                                       F-5
<PAGE>

                          CITYVIEW CORPORATION LIMITED
                             STATEMENT OF CASH FLOWS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000


<TABLE>
<CAPTION>



                                                                  Consolidated Entity                          Parent Entity
                                                                31-Dec-00    31-Dec-99    31-Dec-98       31-Dec-00     31-Dec-99
                                                        NOTE       AUD$         AUD$         AUD$             AUD$          AUD$
<S>                                                              <C>             <C>      <C>          <C>             <C>
Cash Flows From Operating Activities
Interest received                                                   139,119          205      10,187      139,119           205
Interest and other costs of finance paid                           (607,455)     (11,040)     (4,667)    (607,455)       (3,635)
Payments to suppliers and employees                              (2,386,099)  (1,971,760) (2,501,032)  (2,386,099)   (1,993,850)
                                                               --------------------------------------    ---------------------------

Net cash provided (used) by operating activities       20(d)     (2,854,435)  (1,982,595) (2,495,512)  (2,854,435)   (1,997,280)
                                                               --------------------------------------    ---------------------------

Cash flows from investing activities
Loan to Sands Solutions.com Pty Ltd ("Sands Solutions")          (2,500,000)           -           -   (2,500,000)            -
Payment for the development of oil fields                          (949,647)           -           -     (949,647)            -
Payment for investment in listed corporation.                      (550,500)           -           -     (550,500)            -
Payment for the acquisition, exploration,
   evaluation and development of oil fields                               -            -  (9,402,910)           -             -
                                                               --------------------------------------    ---------------------------

Net cash provided/(used) by investing activities                 (4,000,147)           -  (9,402,910)  (4,000,147)            -
                                                               --------------------------------------    ---------------------------

Cash from financing activities
Proceeds from the issue of shares                                 7,679,977    1,992,771   2,431,118    7,679,977     1,992,771
Proceeds from the issue of debentures                                     -            -   1,639,344            -             -
Loans from related party                                                  -            -   5,951,600            -             -
Repayment of loan from related party                                      -            -           -            -             -
                                                               --------------------------------------  ---------------------------

Net cash provided/(used) by financing activities                  7,679,977    1,992,771  10,022,062    7,679,977     1,992,771
                                                               --------------------------------------  ---------------------------

Net increase (decrease) in cash                                     825,395       10,176  (1,876,360)     825,395        (4,509)
Cash at the beginning of the financial year                          11,679        1,503   1,882,576       (3,371)        1,138
Adjustment re cash held in entities disposed                        (14,515)           -      (4,713)         527             -
                                                               --------------------------------------    ---------------------------
Cash at the end of the financial year                  20(a)        822,559       11,679       1,503      822,551        (3,371)
                                                               ======================================    ===========================

</TABLE>






   Notes to and forming part of the accounts are included on pages F-7 to F-26

                                       F-6
<PAGE>

              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000



1.       Statement of Accounting Policies

     Significant Accounting Policies

     Accounting policies are selected and applied in a manner which ensures that
     the resulting financial information satisfies the concepts of relevance and
     reliability, and that the substance of underlying  transactions  and  other
     events is reported.

     The following significant accounting policies  have  been  adopted  in  the
     preparation and presentation of the financial report:

     (a) Foreign Currency

     All foreign currency transactions  during  the  financial  year  have  been
     brought to account using the exchange  rate  in  effect  at the date of the
     transaction. Monetary items in foreign currencies have been  translated  at
     the exchange rate existing at the balancing date. Exchange differences  are
     brought to account in the profit and loss account in the  period  in  which
     they arise.

     (b) Taxation

     The Company adopts the liability method  of  tax  effect  accounting  under
     which the income tax expense shown in the  profit  and  loss  statement  is
     calculated on operating profit adjusted for permanent differences. The  tax
     effect of timing differences arising from items being brought to account in
     different periods for income and accounting purposes is carried forward  in
     the balance sheet as a future tax benefit or a deferred tax liability.

     Future income tax benefits:

       (i) are not brought to account unless realisation of the asset is assured
           beyond reasonable doubt; and
       (ii)where they relate to tax losses are only brought to account when
           their realisation is virtually certain.

     (c) Acquisition, Exploration and Development Expenditure

     The consolidated entity has interests in contracts to develop  and  operate
     oil and gas fields in Indonesia and the Philippines.  These  contracts  are
     under standard terms for foreign companies operating in those countries and
     the  amounts   for   acquisition  costs  and  exploration  and  development
     expenditure are recorded at cost. The contracts are subject to controls and
     regulations  by  the  respective  host  countries and to some extent may be
     affected by the political stability of  those countries. While the share of
     revenue from shareable oil and gas from the operations in Indonesia and the
     Philippines will be receivable  by  the  consolidated entity in US dollars,
     the ultimate recoverability  of  the acquisition  costs and exploration and
     development expenditure will be  dependent  on  the  future development and
     successful exploitation of the respective areas of interest or the ultimate
     sale of those areas. The directors  are  not  able to determine what effect
     these factors, together with any fall in world oil and gas prices, may have
     on the future values of any expenditure carried forward.

     (d) Going Concern

     The financial statements have been  prepared  adopting  the  going  concern
     convention which assumes continuity  of  normal business activities and the
     realisation of assets and the settlement  of  liabilities  in  the ordinary
     course of business. The  going  concern  convention  has  been  adopted  as
     agreements have been entered  into under which the share of all expenditure
     for exploration and development of  the  areas of interest in Indonesia and
     the Philippines normally payable by the  consolidated  entity  will in each
     case be met by outside joint venture  partners.  In  addition  arrangements
     have been made to raise sufficient funds  to  meet continuing operations of
     the consolidated entity. As at 31 December 2000 the consolidated entity and
     the parent Company had working  capital  of  AUD$531,613  and   AUD$531,605
     respectively and net assets of AUD$15,936,943.


                                      F-7
<PAGE>

              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000


     Summary of Accounting Policies (cont)

     (e) Depreciation

     All  equipment has been depreciated on a straight-line basis so as to write
     off  the  net  cost of each asset over its expected useful life. The normal
     estimated useful  life for equipment adopted for depreciation purposes is 3
     years.

     (f) Investments

     Investments  in   controlled  entities  are  recorded  at  cost  and  other
     investments are carried at cost or valuation determined  by  the directors.

     (g) Accounts Payable

     Trade  payables   and  other  accounts  payable  are  recognized  when  the
     consolidated  entity  becomes  obliged to make payments for the purchase of
     goods or services received.

     (h) Borrowings

     Debentures, bank loans and other loans are recorded at an amount  equal  to
     the net proceeds received. Interest payable on borrowings is recognized  on
     an accrual basis.

     (i) Financial instruments issued by the Company

     Debt and equity instruments are classified  as  either  liabilities  or  as
     equity in accordance with the substance of the contractual agreements.

     (j) Receivables

     Trade and other receivables are recorded at amounts due less provision  for
     doubtful debts if recovery of the full amount due is no longer probable.

     (k) Recoverable Amount of Non-current Assets

     Non-current assets are written down to the  recoverable  amount  where  the
     carrying value of a non-current asset exceeds  the  recoverable  amount. In
     determining the recoverable amount expected net cash flows  have  not  been
     discounted.

     (l) Principles of consolidation

     The  consolidated  accounts  comprise  the  accounts of the Company and its
     controlled entity. A controlled entity is  any  entity  controlled  by  the
     Company. Control exists where the Company has the  capability  to  dominate
     decision making in relation to the  financial  and  operating  policies  of
     another entity  o  that  the  other  entity operates  with  the  Company to
     achieve the  objectives  of  the  Company. A list of controlled entities is
     contained in Note 18.

     All  inter-company  balances  and  transactions  between  entities  in  the
     consolidated entity, including any unrealized profits or losses, have  been
     eliminated on consolidation.

     Where controlled entities have entered  or  left  the  consolidated  entity
     during the year, their operating results  have  been included from the date
     control was obtained or until the date control ceased.

     (m) Sale of Western Resources NL

     The  financial  statements for the year ended 31 December 1998 included the
     effects of the  sale for a note of AUD$325,786 made as of 18 December 1998
     of the Company's 100%  interest  in Western Resources NL and its
     subsidiaries. The aggregate loss recorded as at  31  December 1998 of this
     transaction to the consolidated entity was AUD$12,673,100. During the year
     ended December 31 1999 the Company wrote off the note of AUD$325,786 due to
     uncollectibility.


                                      F-8
<PAGE>

              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000

<TABLE>
<CAPTION>

                                                             Consolidated Entity                    Parent Entity
                                                   31-Dec-00      31-Dec-99      31-Dec-98    31-Dec-00      31-Dec-99
                                                      AUD$           AUD$           AUD$         AUD$           AUD$
2.  Operating Profit/(Loss)
     The   operating   profit/(loss)   before
     income tax
     includes the following items of revenue
     and expense:
<S>                                                       <C>             <C>            <C>          <C>            <C>
Proceeds from the sale of non current
investment                                                   -               3       325,786            -               3
Revenue - Operating
Sales                                                        -               -             -            -               -
Interest received on loan to Sands Solutions            63,095               -             -       63,095               -
Interest received - other parties                       76,024             205        10,194       76,024             205
Proceeds on sale of investments                              -               -             -            -         179,889
Foreign exchange gain                                   68,249               -             -       68,249               -
                                                  -------------------------------------------------------------------------
 Total Revenue                                         207,368             208       335,980      207,368         180,097
</TABLE>


The shareholders of the Company on 30 December 1999 agreed to partially  satisfy
the debt to Malaysia Mining  Corporation Berhad of AUD$14,861,564 by the sale to
it of the Company's  interest of 6.125% in the Petroleum Permit Block held under
Service  Contract  41 in  offshore  Philippines.  This net  interest  in Service
Contract  41 accrued  to the  Company  through  its  shareholding  of 49% in MMC
Exploration  &  Production  (Philippines)  Pte Ltd. The sale was achieved by the
Company   transferring  to  Malaysia  Mining   Corporation  Berhad  all  of  its
shareholding in MMC Exploration & Production  (Philippines)  Pte Ltd for a price
of  AUD$10,555,450.   The  interest  of  the  Company  in  Service  Contract  41
(represented by its  shareholding in MMC Exploration & Production  (Philippines)
Pte Ltd) had been written  down to a nil value. The sale of  AUD$10,555,450  was
recorded  in the  financial  statements  of the  Company  for the year  ended 31
December 1999 as a capital contribution.

<TABLE>
<CAPTION>

Expenses
<S>                                                <C>            <C>             <C>          <C>           <C>
General and administrative expenses                  1,728,903       3,910,909       3,727,582    1,698,289     4,413,816
Depreciation                                             2,184           9,097           8,446        2,184         8,252
Provision for doubtful debts                           854,850               -               -      854,850             -
Provision for doubtful debts in respect of
amounts receivable from controlled entities                  -               -               -            -     4,088,760
Interest expense                                        59,570         973,121         963,553       59,570       973,121
Loss on disposal of property, plant and
equpment                                                     -               -          12,002            -             -
Write off unidentified assets                                -               -          74,981            -             -
Marketing services                                   1,499,430               -                    1,499,430             -
Corporate public relations                             818,007               -                      818,007             -
Financial and brokerage services                        86,000               -                       86,000             -
Consultants services                                   696,000               -                      696,000             -
Loss on disposal of subsidiary                               -       1,201,388      12,673,100            -     1,201,388
Provision for diminution of investment                       -         214,413         689,095            -            10
Foreign currency translation losses                          -               -         228,508            -             -
Exploration expenditure written off                          -       4,786,387       2,320,800            -             -
                                                  -----------------------------------------------------------------------
 Total expenses                                      5,744,944      11,095,315      20,698,067    5,714,330    10,685,347
                                                  -----------------------------------------------------------------------
Net Income (Loss)                                   (5,537,576)    (11,095,107)    (20,362,087)  (5,506,962)  (10,505,250)
                                                  ========================================================================
</TABLE>

                                      F-9
<PAGE>

              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000

<TABLE>
<CAPTION>

                                                                Consolidated Entity                  Parent Entity
                                                      31-Dec-00     31-Dec-99      31-Dec-98    31-Dec-00    31-Dec-99
                                                         AUD$          AUD$           AUD$         AUD$         AUD$
<S>                                                <C>           <C>          <C>            <C>          <C>
3.  Income Tax
 (a)The prima facie income tax benefit on pre-tax
    accounting profit reconciles to the income tax
    benefit in the financial statements as follows:
      Operating Profit / (Loss)                       (5,537,576)   (11,095,107) (20,362,087)   (5,506,962)  (10,505,250)
                                                     ---------------------------------------------------------------------
Income tax expense/(benefit) calculated at 34% of
Operating profit for year ended 31 December 2000
and 36% for year ended 31 December 1999 and 1998      (1,882,775)    (3,994,239)  (7,330,351)   (1,872,367)    3,781,890

Permanent differences                                          -              -                          -             -

Tax loss now brought to account                                -              -                          -    (3,781,890)

Timing differences and tax losses not brought to
Account as future income tax benefits                  1,882,775      3,994,239   (7,330,351)     1,872,367            -
                                                     ---------------------------------------------------------------------
Income tax expense                                             -              -            -            -              -
                                                     ---------------------------------------------------------------------
(b) Future income tax benefits not brought to
account as assets                                     14,211,080     12,328,305   10,279,690     13,492,663    8,020,296
                                                     ---------------------------------------------------------------------
                                                      14,211,080     12,328,305  10,279,690     13,492,663     8,020,296
                                                     ---------------------------------------------------------------------
</TABLE>

The  taxation  benefits  of tax  losses and timing  differences  not  brought to
account  will only be obtained if:
  i)  assessable  income is derived of a nature and of an amount  sufficient  to
      enable the benefit  from the  deductions  to be realized:
 ii)  conditions for deductibility imposed by the law are complied  with;  and
iii)  no changes in tax  legislation  adversely  affect the realization of the
      benefit from the deductions.

                                      F-10
<PAGE>


              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000

4.  Directors' Remuneration

The directors of the Company for the year ended 31 December 2000 were :

Peter Mark Smyth
Peter John Augustin Remta
Leslie Robert Maurice Friday
<TABLE>
<CAPTION>

                                                                Consolidated Entity               Parent Entity
                                                           31-Dec-00   31-Dec-99  31-Dec-98  31-Dec-00 31-Dec-99  31-Dec-98
                                                              AUD$        AUD$       AUD$       AUD$      AUD$       AUD$
<S>                                                     <C>             <C>     <C>        <C>       <C>          <C>
The aggregate of income paid or payable,or otherwise
made available, in respect of the financial year,
to all directors of the Company, directly or indirectly,
by the Company or by any related party.                                                        284,915   985,000      413,207
                                                                                           ------------------------------------

The aggregate of income paid or payable,
or otherwise made available, in respect
of the financial year, to all directors
of each entity in the consolidated
entity, directly or indirectly, by the
entities in which they are directors or
by any related party.                                      284,915      985,000  413,207
                                                        -----------------------------------

The number of directors of the Company whose total income falls within each
successive AUD$10,000 band of income;
           0 -   $  9,999                                      -             1               -             1          -
$10,000 -   $19,999                                            1             -               1             -          4
$50,000 -   $59,999                                            1             -               1             -          -
$60,000 -   $69,999                                            -             1               -             1          1
$220,000 - $229,999                                            1             -               1             -          -
$280,000 - $289,999                                            -             1               -             1          1
$630,000 - $639,999                                            -             1               -             1          -

</TABLE>

All of the executives of the Company were also its directors during the
financial year.

                                      F-11
<PAGE>


              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000

5.  Employee Share Plan

The Company has an Employee Share Plan (which includes an Incentive Option Plan)
that was approved by  shareholders  at the Annual General Meeting held on 31 May
2000.

On 14 June  2000 the  Company  issued a total of  2,000,000  options  under  the
Incentive  Option Plan forming part of the Employee Share Plan.  During the year
there were no more than ten eligible  participants  for the Employee Share Plan.
The options  were issued as a  performance  incentive  for no  consideration  to
eligible  employees  under the  Incentive  Option  Plan.  Each of these  options
confers the right to acquire one (1) ordinary fully paid share in the capital of
the  Company at a price of AUD$0.80  each on or before 14 June 2001.  All of the
options remained unexercised and on issue as at 31 December 2000.
<TABLE>
<CAPTION>

                                                                  Consolidated Entity                Parent Entity
                                                                31-Dec-00     31-Dec-99            31-Dec-00    31-Dec-99
                                                                   AUD$          AUD$                 AUD$         AUD$
6.  Remuneration of Auditors
Amounts received, or due and receivable from the
Company and any related organisation for:
<S>                                                            <C>            <C>                <C>            <C>
Auditing the financial statements                                 20,000         25,000             20,000         25,000
Other services                                                    15,000         20,000             15,000         20,000
                                                           -----------------------------       ---------------------------
                                                                  35,000         45,000             35,000         45,000
                                                           -----------------------------       ---------------------------

7.  Current Receivables
Prepayments and deposits                                               -              -                  -              -
Other debtors                                                    854,850          4,115            854,850              -
Provision for doubtful debt                                     (854,850)             -           (854,850)             -
                                                           -----------------------------       ---------------------------
                                                                       -          4,115                  -              -
                                                           -----------------------------       ---------------------------

On 28 February 2000 the Company  acquired  1,000,000 shares and 250,000 warrants
in CGX  Energy  Inc at a cost of  AUD$1,676,150  which  was  lent to it by Azure
Energy Fund Inc. On 18 May 2000 the Company  sold the shares for the  equivalent
of  AUD$2,531,000  and  after  settlement  of the  loan  realised  a  profit  of
AUD$854,850.  That profit has not yet been  received  from Azure Energy Fund Inc
and  consequently  a provision  for doubtful  debt has been raised.  The Company
still  holds the  warrants  but they  have not been  included  in the  financial
statements as they have minimal value.

8.  Non Current Receivables
Loans to controlled entities                                           -              -          4,620,000             -
Loan to Sands Solutions                                        2,500,000              -          2,500,000             -
Loans to Medco Madura Pty Ltd and
Medco Simenggaris Pty Ltd                                      7,725,105              -          7,725,105     7,442,800
                                                          ------------------------------       ------------------------------
                                                              10,225,105              -         14,845,105     7,442,800
                                                          ------------------------------       ------------------------------

</TABLE>

The loans to Medco Madura Pty Ltd and Medco Simenggaris Pty Ltd represent moneys
owing  to the  Company  for  work  previously  carried  out on  the  Madura  and
Simenggaris  blocks  in  Indonesia  and paid for by the  Company.  The  ultimate
recoverability  of these  loans is  dependent  upon the future  development  and
successful exploitation of the Madura and Simenggaris blocks by those companies.

The loan to Sands Solutions is secured by a registered fixed and floating charge
over all the assets and  undertaking  of that  company.  Its  recoverability  is
reliant  in the  normal  course  of  trading  on the  planned  expansion  of and
increased revenues from the businesses  conducted by Sands Solutions or the sale
of those  businesses and other assets of that company.  It is considered that in
the  event of  default  a sale of those  businesses  and  assets  would  realise
sufficient  funds to  satisfy  the loan.  The  directors  would set off the loan
against any  purchase  money  payable for the  acquisition  by the Company of an
interest in Sands Solutions.

                                      F-12
<PAGE>

              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000
<TABLE>
<CAPTION>

                                                                    Consolidated Entity                Parent Entity
                                                                 31-Dec-00       31-Dec-99          31-Dec-00    31-Dec-99
                                                                    AUD$            AUD$               AUD$         AUD$
9. Non-Current Investments
At cost:
<S>                                                                   <C>           <C>                <C>         <C>
Shares in controlled entities - CityView Asia Pty
Ltd                                                                       -             -                 10           10
Shares and options in listed corporation                            550,500             -            550,500            -
                                                           -------------------------------     ---------------------------
                                                                    550,500             -            550,510           10
                                                           -------------------------------     ---------------------------

10.  Equipment
Equipment at cost                                                                                     11,907       24,752
                                                                     11,907        27,907
Less accumulated depreciation                                        (2,184)      (27,907)            (2,184)     (24,752)
                                                           -------------------------------     ---------------------------
                                                                      9,723                                -        9,723
                                                           -------------------------------     ---------------------------

11.   Acquisition, Exploration and Development
Acquisition costs and exploration and development
expenditure carried forward in respect of areas of
interest at cost:                                                 4,620,002     7,563,651                  -            -
                                                           -------------------------------     ---------------------------

                                                                  4,620,002     7,563,651                  -            -
                                                           -------------------------------     ---------------------------

The  consolidated  entity has entered into  contracts to develop and operate oil
fields in Indonesia and the  Philippines.  These  contracts  are under  standard
terms for foreign  companies  operating  in those  countries.  The costs will be
amortised over the life of the various projects once production  commences.  The
ultimate recoverability of the acquisition costs and exploration and development
expenditure is dependent upon the future development and successful exploitation
or the possible sale of the respective areas of interest.

12.   Current Accounts Payable
Unsecured:
Trade creditors                                                     113,006       476,156            113,006      115,393
Accrued expenses                                                    177,940       943,405            177,940    1,194,776
                                                           -------------------------------     ---------------------------
                                                                    290,946     1,419,561            290,946    1,310,169
                                                           -------------------------------     ---------------------------

13.   Current Borrowings
Debentures                                                                -       668,610                  -      668,610
Other                                                                     -             -                  -        3,371
                                                           -------------------------------     ---------------------------
                                                                          -       668,610                  -      671,981
                                                           -------------------------------     ---------------------------

</TABLE>

                                      F-13

<PAGE>

              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000

<TABLE>
<CAPTION>

                                                                 Consolidated Entity               Parent Entity
                                                                31-Dec-00      31-Dec-99          31-Dec-00    31-Dec-99
14.   Share Capital                                                AUD$           AUD$               AUD$         AUD$
<S>                                                           <C>            <C>               <C>          <C>
Ordinary fully paid shares on issue as at 31 December
2000 were 47,064,516 shares (1999: 29,025,216 shares)            60,873,721     44,890,476        50,318,271   44,890,476
                                                            -------------------------------     --------------------------
                                                                 60,873,721     44,890,476        50,318,271   44,890,476
                                                            -------------------------------     --------------------------

During the year ended 31 December 2000 the Company issued the following shares:


Date            Nature of Issue                               Issue price        Number of            Share capital
----            ---------------
                                                            for each share         Shares                         A$
                                                                ----------         ------                          -
19 01 00        Conversion debenture                             0.61              808,255     +                493,561
19 01 00        Conversion debenture                             0.53              312,735     +                165,593
19 01 00        Share issued                                     0.50            7,300,000     #              3,613,500
01 02 00        Option exercise                                  0.76              100,000                       76,000
02 02 00        Option exercise                                  0.76               10,000     *                  7,600
04 02 00        Option exercise                                  0.76               40,000                       30,400
07 02 00        Option exercise                                  0.76              200,000                      152,000
07 02 00        Option exercise                                  0.70              160,000     *                112,000
16 02 00        Option exercise                                  0.76              400,000                      304,000
05 03 00        Option exercise                                  0.70               10,000                        7,000
07 03 00        Option exercise                                  0.70               70,000                       49,000
09 03 00        Option exercise                                  0.76               10,000                        7,600
16 03 00        Option exercise                                  0.76              250,000                      190,000
22 03 00        Option exercise                                  0.76              200,000                      152,000
28 03 00        Option exercise                                  0.76               50,000                       38,000
07 04 00        Option exercise                                  0.70               10,000                        7,000
11 04 00        Shares issued for services                       1.00              500,000     *                500,000
11 04 00        Shares issued for services                       2.10            2,200,000     *              4,620,000
02 05 00        Option exercise                                  0.63              600,000                      376,800
02 05 00        Shares issued for services                       1.00              300,000     *                300,000
06 06 00        Shares issued for services                       0.86              900,000     *                774,000
01 09 00        Shares issued                                    1.45              424,310     #                615,250
05 09 00        Shares issued                                    1.45              617,500     #                895,375
11 09 00        Shares issued for services                       1.45              280,000     *                406,000
15 09 00        Shares issued for services                       1.45              200,000     *                290,000
21 09 00        Shares issued for services                       1.01              104,000     *                114,566
20 11 00        Option exercise                                  0.80              857,500                      686,000
01 12 00        Option exercise                                  0.80              125,000                      100,000
18 12 00        Option exercise                                  0.76              500,000                      380,000
19 12 00        Shares issued for services                       1.04              500,000     *                520,000
                                                                            ---------------      -----------------------
                                                                                18,039,300                   15,983,245
+ Shares issued  following the last exercise of a right of conversion by holders
of debentures that were given by the Company in June 1998 to support  borrowings
for working capital purposes

*  Shares  and  options  issued  for  services rendered, satisfaction of debt or
   purchase of assets

#  Shares issued to raise working capital

</TABLE>

                                      F-14

<PAGE>


Options:
As at 31 December 2000 there were on issue:
(i) 540,000 unlisted  options  convertible into fully paid ordinary shares at an
    exercise price of AUD$0.76 each on or before 30 June 2001;
(ii) 3,400,000  unlisted options  convertible into fully paid ordinary shares at
     an exercise price of AUD$1.62 each on or before 31 December 2001;
(iii)2,000,000   unlisted  options issued  as part of the Incentive  Option Plan
     under the Employee Share Plan  and convertible  into  fully  paid  ordinary
     shares at an exercise  price of  AUD$0.80 each on or before 14 June 2001;
     and
(iv) 4,417,500  unlisted options  convertible into fully paid ordinary shares at
     an exercise price of AUD$0.80 each on or before 14 June 2001.

<TABLE>
<CAPTION>

                                                                    Consolidated Entity              Parent Entity
                                                                 31-Dec-00       31-Dec-99        31-Dec-00   31-Dec-99

15.  Reserves
<S>                                                                <C>              <C>             <C>         <C>
Asset revaluation reserve                                             -                 -              -           -
Balance at beginning of financial year                                -           281,286              -           -
Devaluation of exploration and development                            -          (281,286)             -           -
                                                              ----------------  --------------   ------------ -----------
Balance at the end of the financial year                              -                  -              -           -
                                                              ----------------  --------------   ------------ ------------

16.  Earnings per share                                          31-Dec-00       31-Dec-99
Basic earnings/(loss) per share (cents per share)                  (.13c)          (.70c)

The weighted average number of ordinary shares on issue
used in the calculation of basic earnings per share              41,999,364      15,899,719
</TABLE>


Diluted  earnings  per  share  are  not  disclosed  as they  are not  materially
different from basic earnings per share

                                      F-15

<PAGE>


              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000


17.  Financial Reporting by Segments
(a)  Industry Segments

<TABLE>
<CAPTION>

                                         Investments                                       Exploration

                        31 Dec 00       31 Dec 99        31 Dec 98        31 Dec 00         31 Dec 99         31 Dec 98
                           AUD$            AUD$             AUD$             AUD$              AUD$              AUD$
Revenue outside the
<S>                    <C>              <C>               <C>                   <C>              <C>            <C>
consolidated entity       139,119            -               10,194                -                208            325,786
                      --------------- --------------- --------------- ---------------- ------------------ -----------------
Segment operating
profit and (loss)        (604,656)           -             (715,074)      (4,932,920)       (11,095,107)       (19,647,013)
                      --------------- --------------- --------------- ---------------- ------------------ -----------------
Segment operating
profit and (loss)
after tax                (604,656)           -             (715,074)      (4,932,920)       (11,095,107)       (19,647,013)
                      --------------- --------------- --------------- ---------------- ------------------ -----------------
Segment assets          3,882,782            -           12,237,888       12,345,107          7,579,445         12,657,973


<CAPTION>

                                        Eliminations                                      Consolidated
                        31 Dec 00       31 Dec 99        31 Dec 98        31 Dec 00         31 Dec 99        31 Dec 98
                           AUD$            AUD$             AUD$             AUD$              AUD$             AUD$
Revenue outside the
<S>                          <C>          <C>                  <C>        <C>                    <C>         <C>
consolidated entity             -            -                    -          139,119                208         335,980
                      ------------- ----------------- --------------- ---------------- ------------------ -----------------
Segment operating
profit and (loss)               -            -                    -       (5,537,576)       (11,095,107)    (20,362,087)
                      ------------- ----------------- --------------- ---------------- ------------------ -----------------

Segment operating profit
and (loss) after tax            -            -                    -       (5,537,576)       (11,095,107)    (20,362,087)
                      ------------- ----------------- --------------- ---------------- ------------------ -----------------
Segment assets                  -            -          (11,647,975)      16,227,889          7,579,445      13,247,886


The major products and services covered by those segments are:  Investments from
general financing and corporate activities Exploration of oil and gas interests

(b)  Geographical Segments
<CAPTION>

                                         Indonesia                                         Australia
                             31 Dec 00       31 Dec 99        31 Dec 98        31 Dec 00         31 Dec 99      31 Dec 98
                                AUD$            AUD$             AUD$             AUD$              AUD$           AUD$
Revenue Outside the
<S>                                 <C>           <C>      <C>    <C>    <C>    <C>
consolidated entity                   -             -                  -          139,119              208        335,980
                           -------------- ------------- ------------------ ---------------- ---------------- --------------
Segment operating profit
and (loss)                   (4,932,920)  (11,545,307)        (3,715,637)        (604,656)         450,200    (24,484,142)
                           -------------- ------------- ------------------ ---------------- ---------------- --------------
Segment operating profit                                      (3,715,637)
and (loss) after tax         (4,932,920)  (11,545,307)                           (604,656)         450,200    (24,484,142)
                           -------------- ------------- ------------------ ---------------- ---------------- --------------
Segment Assets               12,345,107     7,579,445         11,485,351        3,882,782        7,442,800     12,981,824

</TABLE>

                                      F-16
<PAGE>

<TABLE>
<CAPTION>


                                       Eliminations                                      Consolidated
                             31 Dec 00     31 Dec 99        31 Dec 98         31 Dec 00        31 Dec 99       31 Dec 98
                                AUD$          AUD$             AUD$              AUD$             AUD$            AUD$
Revenue Outside the
<S>                               <C>            <C>                <C>        <C>                  <C>        <C>
consolidated entity                   -             -                  -          139,119              208        335,980
                           -------------- ------------- ------------------ ---------------- ---------------- --------------
Segment operating profit
and (loss)                            -             -         (7,837,692)      (5,537,576)     (11,095,107)   (20,362,087)
                           -------------- ------------- ------------------ ---------------- ---------------- --------------
Segment operating profit                                      (7,837,692)                      (11,095,107)   (20,362,087)
and (loss) after tax                  -             -                          (5,537,576)
                           -------------- ------------- ------------------ ---------------- ---------------- --------------
Segment Assets                        -    (7,442,800)       (11,219,289)      16,227,889        7,579,445     13,247,886

</TABLE>

18.  Particulars Relating to All Entities

<TABLE>
<CAPTION>
                                                                          Ownership interest
Parent entity                                                                   2000          1999
<S>                                            <C>         <C>              <C>            <C>
CityView Corporation Limited                      Australia   Ordinary          100%          100%
Controlled entity
CityView Asia Pty  Ltd                            Australia   Ordinary          100%          100%
Other
Medco Madura Pty Ltd                              Australia   Ordinary           25%          100%
Medco Simenggaris Pty Ltd                         Australia   Ordinary           25%          100%

</TABLE>

The  accounts  of Medco  Madura  Pty Ltd and Medco  Simenggaris  Pty Ltd are not
included  in the  consolidated  accounts  according  to  the  equity  method  of
accounting for  investments  because the Company does not exercise a significant
influence  over  those  companies.  The loans to Medco  Madura Pty Ltd and Medco
Simenggaris  Pty Ltd are  classified as  non-current  receivables in the balance
sheet (refer to Note 8).

19.  Winding up of Controlled Entities

During the financial year ended 31 December 2000 the  consolidated  entity wound
up the following  companies (all of which are  incorporated in Australia) due to
the fact that they were inactive and any losses  associated with these companies
had been written off in previous years:

Western Resources NL
Western Sangkimah NL
Western Nusantara Energi Pty Ltd
Western Akar Petroleum Pty Ltd
Western Wisesa Petroleum Pty Ltd

                                      F-17

<PAGE>


              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000

<TABLE>
<CAPTION>

                                                    Consolidated Entity               Parent Entity
                                           31-Dec-00   31-Dec-99     31-Dec-98    31-Dec-00   31-Dec-99
20.  Notes to Statement of Cash Flow          AUD$        AUD$          AUD$         AUD$        AUD$
<S>                                      <C>            <C>         <C>          <C>         <C>
(a) Reconciliation of cash
For the purpose of the statement of
cash flows, cash includes cash on hand
and in banks and investments in money
market instruments, net of outstanding
bank overdrafts. Cash at the end of
the financial year as shown in the
statement of cash flows is reconciled
to the related items in the balance
sheet as follows:

Borrowings                                          -            -             -           -     (3,371)
Cash                                          822,559       11,679         1,503     822,551          -
                                           --------------------------------------------------------------
                                              822,559       11,679         1,503     822,551     (3,371)
                                           --------------------------------------------------------------

(b) Business acquired
During the financial year no business
was
acquired.                                           -            -                         -          -

(c) Business disposed of                            -            -                         -          -
Consideration
Cash                                                -            3       325,786           -          3
                                          ---------------------------------------------------------------
Book value of net assets sold
Cash                                                -            -         4,713           -          -
Non current receivables (net of
foreign exchange gain)                              -            -    15,005,577           -          -
Non current investments                             -            -     1,056,304           -          -
                                          ---------------------------------------------------------------

Net assets disposed of                              -            -    16,066,594           -          -
Adjustment for accumulated losses
already brought to account                          -   (1,201,391)   (3,067,708)          - (1,201,391)
Loss on disposal                                    -    1,201,388    12,673,100           -  1,201,388

                                          ---------------------------------------------------------------
                                                    -            3       325,786           -          3
                                          ---------------------------------------------------------------

</TABLE>

                                      F-18
<PAGE>

<TABLE>
<CAPTION>

                                                    Consolidated Entity                Parent Entity

20.  Note to Statement of Cash Flow         31 Dec-00   31-Dec-99     31 Dec-98    31-Dec-00   31-Dec-99
(cont)                                         AUD$        AUD$          AUD$         AUD$        AUD$
<S>      <C>    <C>    <C>    <C>    <C>    <C>
(d) Reconciliation of operating profit
to net cash provided by operating
activities
Operating profit/(loss) after income tax   (5,537,576) (11,095,107)  (20,362,087) (5,506,962) (10,505,250)
Less non cash operating items:
Depreciation                                    2,184        9,097      (273,678)      2,184        8,252
Mineral exploration expenditure written
off                                                 -    4,786,387     2,320,800           -            -
Provision for loss on loan to
associated entities                                 -            -             -           -    4,088,760
Profit on the sale of Block SC41
Philippines                                         -            -             -           -            -
Interest expense                               59,570      973,121       963,553      59,570      973,121
Loss on disposal of subsidiaries                    -    1,201,388    12,673,100           -    1,201,388
Loss on disposal of plant and equipment             -            -        12,002
Loss on sale of investments                         -      214,413       689,095           -      169,516
Exchange (gain)/Loss                          (68,249)           -             -     (68,249)           -
Issue of shares in lieu of payment to
suppliers and employees                     6,600,556      829,872       127,500   6,460,550      829,872
Write of of unidentified assets                     -            -        74,981           -            -
Write back amortized rent                           -            -      (335,937)          -            -
Change in assets and liabilities:
Purchase of Block SC41 Philippines                  -            -             -   4,620,000
(Increase)/decrease in receivables         (2,782,305)     483,331       149,460  (7,402,305)     330,113
(Decrease)/increase in trade creditors
and accruals                               (1,128,615)     614,903     1,465,699  (1,019,223)     906,948
                                           ---------------------------------------------------------------
Net cash provided/(used) by operating      (2,854,435)  (1,982,595)   (2,495,512) (2,854,435)  (1,997,280)
activities                                 ---------------------------------------------------------------
</TABLE>


(e)      Non-cash financing and investing activities
The  Company  settled  a number of  creditors  through  the issue of shares  and
options and also converted certain debentures into shares as referred to in Note
14.

21.  Related Party Disclosures

(a)      Directors
     The  following  persons held the position of director of the Company during
     the financial year ended 31 December 2000:

     Peter Mark Smyth
     Peter John Augustin Remta
     Leslie Robert Maurice Friday

     The  remuneration  of  directors  is  disclosed  in Note 4 to the financial
     statements.

(b)      Interests of directors

The  directors  and their  related  entities  hold a  relevant  interest  in the
following   shares  in  the  Company:

                      31 December 00                         31 December 99

Shares                    343,076                                442,545
Options                 1,100,000                                550,000


(c)      Transactions with directors and related entities
      (i) Mr P M Smyth is a director and shareholder of Romarcam Investments Pty
          Ltd. The Company has entered into a contract with Romarcam Investments
          Pty Ltd  dated 19 April 1999 for the provision of management services.
          Fees paid  during  the  financial year at normal commercial rates were
          AUD$213,825 compared to AUD$180,000 in the previous year. These
          transactions  have been reflected in Note 4.

     (ii) On  22  March  2000  the  company  issued  200,000  shares to Romarcam
          Investments   Pty   Ltd  following  the  exercise  of  options.  These
          transactions have been reflected in Note 14.

     (iii)Mr P M Smyth is a  non-executive  director  of Sands Solutions and his
          family trust has a one-third  equity interest  in  that  company.  The
          Company made a loan of AUD$2,500,000 to Sands Solutions during the
          year and  has  charged  Sands  Solutions  interest  on  that  loan.
          These transactions have been reflected in Notes 8 and 24.

                                      F-19
<PAGE>

      (iv)Mr  P  J  A  Remta  is  an  employee  and  members  of  his family are
          shareholders of Westchester Pty Ltd  which  provides  consultancy  and
          corporate  management  services  to  the  Company  under a consultancy
          agreement  reduced  to  writing  and  dated  1  February  2001.   Fees
          paid  during  the  financial  year  at  normal  commercial  rates were
          AUD$41,090. These transactions have been reflected in Note 4.

       (v)On 14 June 2000 the Company issued a total  of  1,900,000  options  to
          directors under the Incentive Option Plan  established by the Employee
          Share Plan. Of that number 700,000 options  were  issued  to  Mr  P  M
          Smyth, 500,000 options were issued to Mr  P  J  A  Remta  and  200,000
          options were issued to Mr L R M Friday. In  addition  500,000  options
          were   issued   on  trust  to  Messrs  Friday  and  Remta  for  future
          distribution  to  employees  at the discretion of the directors. These
          transactions have been reflected in Note 5.

(d)      Interests in director-related entities

     Apart  from  the  disclosures  in this note, no director has entered into a
     material contract with the Company  since the end of the financial year and
     there were no  material  contracts  involving  interests  of  directors  or
     payment upon termination subsisting at the end of the financial year.

(e)      Equity interests in controlled entities

     As  disclosed  in  Note 18 the Company has the entire ownership of CityView
     Asia Pty Ltd which is its only controlled entity.

(f)      Transactions within the group

     The  parent  in the consolidated entity is CityView Corporation Limited. As
     disclosed in Note 8, CityView Asia Pty Ltd owes AUD$4,620,000  to  CityView
     Corporation Limited.

     In  addition,  Medco  Simenggaris  Pty Ltd and Medco Madura Pty Ltd owe the
     Company AUD$3,205,322 and AUD$4,519,783  respectively,  although  these
     companies are not part of the consolidated entity (refer to Note 18).

22.  Commitments for Expenditure

(a)  Madura and Simenggaris
     Under  the  agreements  between the Company and PT Medco Energi Corporation
     TBK ("Medco") all of the expenditure for exploration and development of the
     Madura and Simenggaris  blocks,  under a new work program as defined in the
     agreements and as agreed between  Medco  and the Indonesian state owned oil
     and gas organization known as Pertamina would be met by Medco. The new work
     program, as already agreed, covers exploration and development work.

     The cost of any subsequent work to the  Madura  and Simenggaris blocks will
     need to be met by the Company in proportion to its equity interests.

(b)  Service Contract 41
     The documents relating to the acquisition by the consolidated entity of the
     interest of 2.5% in Petroleum Permit Block Service Contract 41 provide that
     MMC Exploration & Production (Philippines) Pte Ltd  will  pay  for  all the
     expenditure attributable to that interest through the current work  program
     wells which is still to be completed.

23.  Subsequent Events

On 1 February 2001 the Company  advanced a further  $250,000 to Sands  Solutions
under the loan  arrangements  disclosed in Note 8, which  increased  the loan to
Sands Solutions to AUD$2,750,000.

On 14  February  2001  the  Company  by  agreement  with the  holders  cancelled
3,917,500  options which were exercisable  AUDat $0.80 each on or before 14 June
2001 and on 16 February 2001 it issued another 3,500,000 options  exercisable at
AUD$0.70 each on or before 30 April 2001.

On 1 March 2001 a total of  2,000,000  of these new options  were  cancelled  by
agreement  between  the  Company and the holders and on 2 March 2001 the Company
issued another  2,000,000  options  exercisable at AUD$0.50 each on or before 31
March 2001.

                                      F-20
<PAGE>

As a result of these  transactions a total of 1,300,000 options has already been
exercised since 31 December 2000 to raise AUD$650,000 as working capital for the
Company.

These transactions were entered into for the purposes of enabling the Company to
raise  additional  working  capital at prices more  reflective of the prevailing
market price of its shares.

The  financial  effects  of the  transactions  referred  to in this Note will be
included in the Company's accounts for the year ended 31 December 2001.

                                      F-21
<PAGE>


              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000


24.  Financial Instruments

(a)  Significant Accounting Policies
     Details  of  the  significant  accounting  policies  and  methods  adopted,
     including the criteria for recognition, the basis of  measurement  and  the
     basis on which revenues and expenses are recognised,  in  respect  of  each
     class of financial asset, financial liability  and  equity  instrument  are
     outlined in Note 1 to the financial statements.

(b)      Interest Rate Risk
<TABLE>
<CAPTION>

                                                                      FIXED INTEREST

                            Average    Variable     Less than      1 to 5      More than 5   Non-Interest       Total
                            Interest    Interest      1 Year        Years         years         Bearing
           2000              rate %      $'000        $'000         $'000         $'000          $'000          $'000

Financial Assets
<S>                         <C>                              <C>                               <C>            <C>
Cash                                                                                               822,559        822,559
Receivables
Loan - Sands Solutions         7%                                2,500,000                                      2,500,000

Financial Liabilities
Payables                                                                                           290,946        290,946

                                                                FIXED INTEREST
                            Average    Variable     Less than      1 to 5      More than 5   Non-Interest       Total
                            Interest    Interest      1 Year        Years         years         Bearing
           1999              rate %        $            $             $             $              $              $

Financial Assets
Cash                                                                                                11,679         11,679
Receivables                                                                                        124,966          4,115

Financial Liabilities
Payables                                                                                         1,419,561      1,419,561
Debentures                     6 %        668,610                                                                 668,610

</TABLE>


(c)  Credit Risk
     The Company has adopted a policy of only dealing with credit worthy parties
     and,  where  appropriate,  obtaining sufficient collateral or security as a
     means of  mitigating  the  risk  of  financial  loss  through  defaults  in
     contractual obligations.

     Except as disclosed in Notes 8 and 21(f) the  Company  does  not  have  any
     significant credit risk exposure to a single  debtor  or  group  of debtors
     having similar characteristics.

     The   carrying  amount  of  financial  assets  recorded  in  the  financial
     statements,  without  provision for losses, represents the maximum exposure
     of the consolidated  entity  to credit risk without taking into account the
     value of any collateral or other security.

     The credit risk exposure of the consolidated entity would also include the
     difference between the carrying amount and the realisable amount.

(d)  Currency hedging
     The  consolidated  entity  has  not  entered  into forward foreign exchange
     contracts to hedge the exchange rate risk  arising   from  transactions  in
     foreign currencies.

(e)  Net Fair Value
     The  carrying  amount  of  assets and liabilities recorded in the financial
     statements represents  their  respective  net  fair  values  determined  in
     accordance with the accounting policies referred to in Note 1.

                                      F-22
<PAGE>


              NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
                  FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2000


25.  Contingent Liabilities

     In November 2000 the Company acquired  a  beneficial  interest  of  25%  in
     Primeorder AG which is a marketing company established in Hamburg,  Germany
     to market the e-commerce applications of Sands Solutions throughout Europe.
     Sands Solutions has a 26% interest in Primeorder AG.

     As partial  consideration for the Company's  interest in Primeorder AG, the
     Company agreed to lend up to AUD$2,000,000  to Sands Solutions.  This money
     will be used for the establishment and promotion of Primeorder AG.

     The extent of the payments and when they will  be  made to satisfy the loan
     will depend on how rapidly Primeorder AG expands its business in Europe.

     The Company has already advanced  AUD$332,251 to Sands Solutions for use by
     Primeorder AG with the advance  forming part of the loan  disclosed in Note
     8.

     As further  consideration for the acquisition of its interest in Primeorder
     AG, the  Company  issued  500,000  options in  November  2000 to persons in
     Germany who are associated  with Primeorder AG. The options are convertible
     into fully paid ordinary shares at an exercise price of AUD$0.80 each on or
     before 14 June 2001.

     There are no other contingent liabilities.

26.  UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES RECONCILIATION
     ("US GAAP")

     The  following  is a summary of all material differences between Australian
     and United States generally accepted accounting principles.

(a)      Marketable Securities

     Investments (or Marketable  Securities) are valued at the lower of cost and
     recoverable  amount (often equated to market value). Any such write-down is
     adjusted  through  the  profit  and  loss  account.  For US GAAP  purposes,
     securities are separated into portfolios of "Trading", "Available for Sale"
     and  "Held to  Maturity".  The  amounts  recorded  as  current  investments
     represent  these which would be classified as "Available for Sale" under US
     GAAP.  Available for Sale are accounted for at market value, with movements
     adjusted through shareholders' equity. An "other than temporary" decline in
     the market value of  investments  has been  recognized as  impairments  and
     recorded in the profit and loss  account.  Realized  profits and losses are
     reversed and adjusted to the profit and loss account.

(b)      Capitalized Exploration Expenditure

     Exploration expenditure incurred by  CityView,  directly  or  through  it's
     joint venture interest,  are  capitalized  as incurred to  the  extent  the
     expenditure is expected to  be  recouped  through  the  sale  of successful
     development of the area, or where the activities  have  not yet  reached  a
     stage that permits reasonable assessment of the existence  of  economically
     recoverable reserves. US GAAP requirements indicate  that  these  costs are
     generally  written-off  as  incurred,  or  until  economically  recoverable
     reserves are identified.

(c)      Income tax

     There  are  no  major  differences  between accounting for income tax under
     Australian and US GAAP. However, where  adjustments  for  other reconciling
     items result in a permanent difference,  appropriate  adjustment  has  been
     made.

(d)      SFAS 121:  Accounting  for  Impairment  of  Long-Lived  Assets  and for
         Long-Lived Assets to be disposed of

     This pronouncement is similar to an Australian Corporations Law requirement
     that requires directors to review the carrying  value  of  all  non-current
     assets annually, determine if they are being recorded at greater than their
     recoverable amount, and if so, write-down the  value  of  the  asset to its
     recoverable amount of disclose information to  prevent  the  accounts  from
     being misleading.

                                      F-23
<PAGE>

(e)      Principles of Consolidation

     As  indicated  in  Note  1(l)  to the financial statements, Australian GAAP
     requires  consolidation  of  controlled  entities.  In  accordance   with
     Australian   GAAP, control exists where an entity has  the "capacity  to
     dominate   decision  making  in   relation to  the  financial and operating
     policies of another entity..." US  GAAP, however, requires than  an  entity
     must control another  entity  usually  as   indicated   by   its  ownership
     interests.   As  the   ownership  interest in the Company's subsidiaries is
     greater then  50% in all cases (representing ownership and actual control),
     no reconciling Australian/US GAAP adjustments are required.

(f)  The  company's  accounting  policy  in  respect  of amortization of carried
     forward  exploration  expenditure  is  calculated based on the economically
     recoverable  proven  reserves  of  the  company.   US  GAAP  requires   the
     amortization to be based  on  the  proven  and  probable  reserves  of  the
     company.  As  significant  production  has  not  commenced CityView has not
     applied  this  accounting  policy  in  the  financial  statements  for  the
     financial  periods ended 31 December 1998, 31 December 1999 and 31 December
     2000 and therefore no reconciliation adjustment is required.

(g)  New Accounting Standards

     The  effect  of  the  application of the following recent pronouncements is
     considered below. Their  application will not have a material effect on the
     Australian/US GAAP reconciliations detailed in this note.

     In  June  1998 and June 2000, the FASB issued SFAS No. 133, "Accounting for
     Derivative    Instruments   and  Hedging  Activities"  and  SFAS  No.  138,
     "Accounting  for   Certain  Derivative  Instruments  and  Certain   Hedging
     Activities." These statements establish accounting and reporting  standards
     requiring that every derivative instrument be recorded on the balance sheet
     as either an asset or liability measured at its fair value. SFAS  Nos.  133
     and 138 also require  that  changes  in  the  derivative's  fair  value  be
     recognized currently in  earnings unless specific hedge accounting criteria
     are met. SFAS Nos. 133  and  138  are  effective for fiscal years beginning
     after June 15, 2000. The Company does not expect that the adoption of these
     new standards  will  have  a  material  impact on the Company's earnings or
     financial position.

(h)  Employee Stock Purchase Plan

     The Company has one stock-based  compensation  plan.  The  Company  applies
     Australian GAAP and related interpretations in accounting  for  its  plans.
     Accordingly, no compensation cost has been recognized for its stock option
     plan.Under US GAAP under FASB 123, Accounting for Stock Based Compensation,
     disclosure is  required  of  compensation  expense  that  would  have  been
     recognized on FASB 123. Had compensation cost for the Company's stock-based
     compensation  plan  been  determined  based  on the fair value at the grant
     dates for awards under those plans  consistent  with  the  method  of  FASB
     Statement 123, the Company's net loss and loss per share  would  have  been
     increased to the pro forma amounts indicated below:

                                      F-24
<PAGE>
<TABLE>
<CAPTION>


                                                       31-Dec-00        31-Dec-00         31-Dec-99          31-Dec-98
                                                          US$              AUD$              AUD$               AUD$
                                                     --------------- ----------------- ----------------- ------------------

<S>                                                 <C>             <C>              <C>                <C>
Net Profit (Loss) after Income Tax attributable
to members of the parent company

    -   As reported                                    (3,100,489)     (5,537,576)       (11,095,107)      (20,362,087)
    -   Pro Forma                                      (3,244,489)     (5,681,576)       (11,235,107)      (20,362,087)

Basic earnings (loss) per share  - As reported              (0.07)           (.13)             (0.70)            (1.53)
                                 - Pro Forma                (0.08)           (.14)             (0.71)            (1.53)


The fair value of each option grant was  estimated as of the date of grant using
the Black-  Scholes  option-pricing  model with the  following  weighted-average
assumptions  used for grants in the period ended  December 31, 2000 and 1999: no
dividends will be paid,  expected volatility of 50.0% risk-free interest rate of
5% and expected lives of 1 year.

Reconciliation  Adjustments

The  following  reconciliations  show  the  effect  on net  profit/loss  for the
financial periods ended December 31, 2000, 1999 and 1998 using the US GAAP basis
of accounting for the matters outlined in items (a) to (h) above.


                                                      31-Dec-00        31-Dec-00        31-Dec-99        31-Dec-98
                                            Note         US$              AUD$             AUD$             AUD$
                                         ----------- ---------------- ---------------- ----------------- ----------------
Reconciliation Adjustments
   Net income (loss) after tax in
   accordance with Australian GAAP                      (3,100,489)      (5,537,576)      (11,095,107)     (20,362,087)

Reconciliation Adjustments
   Transfer realized temporary
   share portfolio losses from
   shareholder's equity (reserve)         (g) (1)                -                -       (1,734,895)                -

   Exploration expenditure
   written-off as incurred                              (2,586,739)      (4,620,002)         4,786,387        8,173,185

   Stock based compensation cost           (h)            (120,939)        (216,000)                 -                -
                                                    ---------------- ---------------- ----------------- ----------------
Net income (loss) after tax in accordance
with US GAAP                                            (5,808,167)       10,373,576       (8,043,615)     (12,188,902)
                                                    ================ ================ ================= ================

Earnings (loss) per share from                                (.14)            (.25)             (.51)            (.92)
Continuing Operations in accordance
with US GAAP (in cents)
</TABLE>



(1) Represents the realized loss on the sale of Triton Investment.

                                      F-25
<PAGE>

<TABLE>
<CAPTION>


                                                         31-Dec-00        31-Dec-00        31-Dec-99         31-Dec-98
                                            Note            US$              AUD$             AUD$              AUD$
                                         ----------- ---------------- ---------------- ----------------- ----------------
Reconciliation Adjustments
   <S>                                                 <C>            <C>                <C>            <C>
   Shareholder's equity attributable to
   member of the chief entity in
   accordance with Australian GAAP                        8,923,094       15,936,943         5,491,274      (2,803,225)

Reconciliation Adjustments

   Exploration expenditure written-off  (b)              (6,753,963)     (12,062,802)       (7,442,800)     (12,510,473)
   as incurred
                                                    ---------------- ---------------- ----------------- ----------------
Total shareholder's equity in                             2,169,131        3,874,141        (1,951,526)     (15,313,698)
accordance with US GAAP                             ================ ================ ================= ================

</TABLE>

                                      F-26
<PAGE>


ITEM 18.  FINANCIAL STATEMENTS.

Not applicable. Consolidated financial statements are provided under Item 17.


ITEM 19.  EXHIBITS.

None


                                       51

<PAGE>

                                   SIGNATURES

The Registrant hereby certifies that it meets all of the requirements for filing
on Form 20-F and that it has duly caused and authorized the  undersigned to sign
this annual report on its behalf.





                                               CITYVIEW CORPORATION LIMITED



                                             By/s/Mark Smyth___________

                                              Peter Mark Smyth
                                              Chief Executive Officer and
                                              Member Of the Board of Directors


 Dated:  June 15, 2001


                                       52