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

                                    FORM 10-Q

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

              For the quarterly period ended SEPTEMBER 30, 1997

                                       OR

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

                         Commission File Number 1-11450

                              SANTA FE ENERGY TRUST

             (Exact name of registrant as specified in its charter)

             TEXAS                                              76-6081498
(State or other jurisdiction                                 (I.R.S. Employer
 of incorporation or organization)                          Identification No.)

                    TEXAS COMMERCE BANK NATIONAL ASSOCIATION
                            CORPORATE TRUST DIVISION
                             600 TRAVIS, SUITE 1150
                              HOUSTON, TEXAS 77002
               (Address of principal offices, including zip code)

        Registrant's telephone number, including area code (713) 216-5087


                                      NONE
          (Former name or former address, if changed since last report)

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

               Depository Units outstanding at October 31, 1997

                                  6,300,000
<PAGE>
PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                              SANTA FE ENERGY TRUST
          STATEMENT OF CASH PROCEEDS AND DISTRIBUTABLE CASH (UNAUDITED)
                      (IN THOUSANDS, EXCEPT PER UNIT DATA)

                                       THREE MONTHS ENDED      NINE MONTHS ENDED
                                          SEPTEMBER 30,           SEPTEMBER 30,
                                       ------------------    ------------------
                                         1997       1996       1997       1996
                                       -------    -------    -------    -------
Royalty income:
    ODC royalty ....................  $  1,053   $  1,246   $  3,650   $  3,293
    Willard royalty ................       501        635      1,777      1,689
    Net profits royalty ............     1,373      1,584      5,543      4,302
    Support payment recoupment .....      --         (375)    (1,065)      (492)
                                      --------   --------   --------   --------
Total royalties ....................     2,927      3,090      9,905      8,792
Administrative fee to Santa Fe
    Energy Resources, Inc. .........       (57)       (55)      (169)      (162)
Advance from Santa Fe Energy
    Resources, Inc. ................      --         --         --          200
Repayment of advance from
    Santa Fe Energy Resources, Inc.       --         (100)      --         (225)
Cash withheld for trust expenses ...       (50)      (100)      (250)      (377)
                                       -------    -------    -------    -------
Distributable cash .................  $  2,820   $  2,835   $  9,486   $  8,228
                                      ========   ========   ========   ========
Distributable cash per trust unit ..  $0.44757   $0.45000   $1.50569   $1.30609
                                      ========   ========   ========   ========
Trust units outstanding ............     6,300      6,300      6,300      6,300
                                      ========   ========   ========   ========

             STATEMENT OF ASSETS, LIABILITIES AND TRUST CORPUS
                                 (IN THOUSANDS)
                                                  SEPTEMBER 30,   DECEMBER 31,  
                                                      1997           1996
                                                   --------       --------
                                                   (UNAUDITED)         
                      ASSETS                                           
Current assets:                                                        
    Cash ........................................  $    140       $     46
    Receivable from Santa Fe Energy 
      Resources, Inc. ...........................      --              100
                                                   --------       --------
                                                        140            146
                                                   --------       --------
Investment in royalty interest, at cost .........    87,276         87,276
Less: accumulated amortization ..................   (45,181)       (39,002)
                                                   --------       --------
                                                     42,095         48,274
                                                   --------       --------
                                                   $ 42,235       $ 48,420
                                                   ========       ========
                   TRUST CORPUS                                   
Trust corpus, 6,300,000 trust units issued and                    
  outstanding....................................  $ 42,235       $ 48,420
                                                   ========       ========
    SEE ACCOMPANYING NOTES
                                        2
<PAGE>
                              SANTA FE ENERGY TRUST
                STATEMENT OF CHANGES IN TRUST CORPUS (UNAUDITED)
                                 (IN THOUSANDS)


Balance at December 31, 1995 ...............................           $ 57,654
   Cash proceeds ...........................................             11,565
   Cash distributions ......................................            (11,063)
   Trust expenses ..........................................               (335)
   Amortization of royalty interests .......................             (9,401)
                                                                       --------
Balance at December 31, 1996 ...............................             48,420
   Cash proceeds ...........................................              9,736
   Cash distributions ......................................             (9,486)
   Trust expenses ..........................................               (256)
   Amortization of royalty interests .......................             (6,179)
                                                                       ========
Balance at September 30, 1997 ..............................           $ 42,235
                                                                       ========
   SEE ACCOMPANYING NOTES
                                       3
<PAGE>
                              SANTA FE ENERGY TRUST
                        NOTES TO THE FINANCIAL STATEMENTS
                                   (UNAUDITED)


NOTE 1.     THE TRUST

      Santa Fe Energy Trust (the "Trust") was formed on October 22, 1992, with
Texas Commerce Bank National Association as trustee (the "Trustee"), to acquire
and hold certain royalty interests (the "Royalty Interests") in certain
properties (the "Royalty Properties") conveyed to the Trust by Santa Fe Energy
Resources, Inc. ("Santa Fe"). The Royalty Interests consist of two term royalty
interests in two production units in the Wasson field in west Texas (the "Wasson
Royalties") and a net profits royalty interest in certain royalty and working
interests in a diversified portfolio of properties located in twelve states (the
"Net Profits Royalties"). The Royalty Interests are passive in nature and the
Trustee has no control over or responsibility relating to the operation of the
Royalty Properties. The Trust will be liquidated on February 15, 2008 (the
"Liquidation Date").

      In November 1992, 5,725,000 Depository Units, each consisting of
beneficial ownership of one unit of undivided beneficial interest in the Trust
("Trust Units") and a $20 face amount beneficial ownership interest in a $1,000
face amount zero coupon United States Treasury obligation maturing on or about
February 15, 2008, were sold in a public offering for $20 per Depository Unit. A
total of $114.5 million was received from public investors, of which $38.7
million was used to purchase the Treasury obligations and $5.7 million was used
to pay underwriting commissions and discounts. Santa Fe received the remaining
$70.1 million and 575,000 Depository Units. In the first quarter of 1994 Santa
Fe sold in a public offering the 575,000 Depository Units which it held.

      The trust agreement under which the Trust was formed (the "Trust
Agreement") provides, among other things, that:

o    the Trustee shall not engage in any business or commercial activity or
     acquire any asset other than the Royalty Interests initially conveyed to
     the Trust;

o    the Trustee may not sell all or any portion of the Wasson Royalties or
     substantially all of the Net Profits Royalties without the prior consent of
     Santa Fe;

o    Santa Fe may sell the Royalty Properties, subject to and burdened by the
     Royalty Interests, without consent of the holders of the Trust Units;
     following any such transfer, the Royalty Properties will continue to be
     burdened by the Royalty Interests and after any such transfer the royalty
     payment attributable to the transferred property will be calculated
     separately and paid by the transferee;

o    the Trustee may establish a cash reserve for the payment of any liability
     which is contingent, uncertain in amount or that is not currently due and
     payable;

o    the Trustee is authorized to borrow funds required to pay liabilities of
     the Trust, provided that such borrowings are repaid in full prior to
     further distributions to the holders of the Trust Units;

o    the Trustee will make quarterly cash distributions to the holders of the
     Trust Units.

NOTE 2.     BASIS OF ACCOUNTING

      The financial statements of the Trust are prepared on the cash basis of
accounting for revenues and expenses. Royalty income is recorded when received
(generally during the quarter following the end of the quarter in which the
income from the Royalty Properties is received by Santa Fe) and is net of any
cash basis exploration and development expenditures and amounts reserved for any
future exploration and development costs. Expenses

                                       4
<PAGE>
                              SANTA FE ENERGY TRUST
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

NOTE 2.     BASIS OF ACCOUNTING (CONTINUED)

of the Trust, which will include accounting, engineering, legal, and other
professional fees, Trustee fees, an administrative fee paid to Santa Fe and
out-of-pocket expenses, are recognized when paid. Under generally accepted
accounting principles, revenues and expenses would be recognized on an accrual
basis. Amortization of the Trust's investment in Royalty Interests is recorded
using the unit-of-production method in the period in which the cash is received
with respect to such production.

      The conveyance of the Royalty Interests to the Trust was accounted for as
a purchase transaction. The $87,276,000 reflected in the Statement of Assets and
Trust Corpus as Investment in Royalty Interests represents 6,300,000 Trust Units
valued at $20 per unit less the $38,724,000 paid for the Treasury obligations.
The carrying value of the Trust's investment in the Royalty Interests is not
necessarily indicative of the fair value of such Royalty Interests.

      The Trust is a grantor trust and as such is not subject to income taxes
and accordingly no recognition has been given to income taxes in the Trust's
financial statements. The tax consequences of owning Trust Units are included in
the income tax returns of the individual Trust Unit holders.

NOTE 3.     THE ROYALTY INTERESTS

      The Wasson Royalties consist of interests conveyed out of Santa Fe's
royalty interest in the Wasson ODC Unit (the "ODC Royalty") and the Wasson
Willard Unit (the "Willard Royalty"). The ODC Royalty entitles the Trust to
receive quarterly royalty payments with respect to 12.3934% of the actual gross
oil production from the Wasson ODC Unit, subject to certain quarterly
limitations set forth in the conveyance agreement, for the period from November
1, 1992 to December 31, 2007. The Willard Royalty entitles the Trust to receive
quarterly royalty payments with respect to 6.8355% of the actual gross oil
production from the Wasson Willard Unit, subject to certain quarterly
limitations set forth in the conveyance agreement, for the period from November
1, 1992 to December 31, 2003.

      The Net Profits Royalties entitle the Trust to receive, on a quarterly
basis, 90% of the net proceeds, as defined in the conveyance agreement, from the
sale of production from the properties subject to the conveyance agreement. The
Net Profits Royalties are not limited in term, although the Trustee is required
to sell such royalties prior to the Liquidation Date.

      For any calendar quarter ending on or prior to December 31, 2002, the
Trust will receive additional royalty payments ("Support Payments") to the
extent it needs such payments to distribute $0.40 per Trust Unit per quarter.
Such Support Payments are limited to Santa Fe's remaining royalty interest in
the Wasson ODC Unit. If such Support Payments are received, certain proceeds
otherwise payable to the Trust in subsequent quarters may be reduced to recoup
the amount of such Support Payments. The aggregate of the Support Payments, net
of any amounts recouped, is limited to $20,000,000 on a revolving basis. Through
the end of 1995, the Trust had received Support Payments totalling $2,074,000.
During 1996 and the first six months of 1997 Santa Fe recouped all of such
payments.
                                       5
<PAGE>
                              SANTA FE ENERGY TRUST
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

NOTE 4.     DISTRIBUTION TO TRUST UNIT HOLDERS

      The Trust has received royalty payments and made distributions as follows:

                                      ROYALTY                   DISTRIBUTIONS
                                      PAYMENT           ------------------------
                                      RECEIVED           AMOUNT   PER TRUST UNIT
                                      --------          -------   --------------
                                          (IN THOUSANDS, EXCEPT PER UNIT DATA)
1996
First quarter ..............         $ 2,660            $ 2,558     $0.40609
Second quarter .............           2,935(a)           2,835      0.45000
Third quarter ..............           3,035(b)           2,835      0.45000
Fourth quarter .............           2,935(c)           2,835      0.45000
                                     =======            =======     ========
                                     $11,565            $11,063     $1.75609
                                     =======            =======     ========
1997
First quarter ..............         $ 2,985(d)         $ 2,835     $0.45000
Second quarter .............           3,881(e)           3,831      0.60812
Third quarter ..............           2,870              2,820      0.44757

(a)  Reduced by recoupment of Support Payment of $117,000, or $0.01857 per Trust
     Unit.

(b)  Reduced by recoupment of Support Payment of $375,000, or $0.05953 per Trust
     Unit.

(c)  Reduced by recoupment of Support Payment of $517,000, or $0.08213 per Trust
     Unit.

(d)  Reduced by recoupment of Support Payment of $912,000, or $0.14473 per Trust
     Unit.

(e)  Reduced by recoupment of Support Payment of $153,000, or $0.02429 per Trust
     Unit.
                                       6
<PAGE>
ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
            RESULTS OF OPERATIONS.

GENERAL; LIQUIDITY AND CAPITAL RESOURCES

      Santa Fe Energy Trust (the "Trust") was formed on October 22, 1992 with
Texas Commerce Bank National Association as trustee (the "Trustee"), to acquire
and hold certain royalty interests (the "Royalty Interests") in certain
properties (the "Royalty Properties") conveyed to the Trust by Santa Fe Energy
Resources, Inc. ("Santa Fe"). The Trust is a passive entity with the Trustee's
primary responsibility being the collection and distribution of proceeds from
the Royalty Interests and the payment of Trust liabilities and expenses (see
Note 1 to the financial statements of the Trust). The Royalty Interests consist
of two term royalty interests in two production units (the Wasson ODC Unit and
the Wasson Willard Unit) in the Wasson field in west Texas (the "Wasson
Royalties") and a net profits royalty interest (the "Net Profits Royalties") in
certain royalty and working interest properties in a diversified portfolio of
properties located predominantly in Texas, Louisiana and Oklahoma (the "Net
Profits Properties"). Under the terms of the Trust Agreement, the Trustee cannot
engage in any other business or commercial activity or acquire any asset other
than the Royalty Interests initially conveyed to the Trust. Therefore, the
Royalty Interests are the sole source of funds for the Trust from which to pay
expenses and liabilities and make distributions to the holders of the Trust
Units. The Trust will be liquidated on or before February 15, 2008 (the
"Liquidation Date").

      The Wasson Royalties are fixed percentage royalty interests in specified
levels of quarterly maximum production from the underlying properties in each
year during the term of the respective royalty. The Wasson ODC Royalty and the
Wasson Willard Royalty terminate on December 31, 2007 and December 31, 2003,
respectively. The Net Profits Royalties are life-of-property interests which
will be sold by the Trust prior to the Liquidation Date. The Net Profits
Royalties entitle the Trust to receive 90% of the net proceeds (after deducting,
among other things, the costs of production and marketing and capital
expenditures) from the sale of production from the Net Profits Properties. The
Net Profits Properties are generally mature producing oil and gas properties and
the production and reserves attributable to such properties are expected to
decline substantially over the life of the Trust. The Net Profits Royalties are
expected to have a relatively small liquidation value at the Liquidation Date.

      For any calendar quarter ending on or prior to December 31, 2002, the
Trust will receive additional royalty payments ("Support Payments") to the
extent it needs such payments to distribute $0.40 per Trust Unit per quarter.
Such Support Payments are limited to Santa Fe's remaining royalty interest in
the Wasson ODC Unit. If Support Payments are received, certain proceeds
otherwise payable to the Trust in subsequent quarters may be reduced to recoup
the amount of such Support Payments. The aggregate amount of Support Payments,
net of any amounts recouped, is limited to $20.0 million on a revolving basis.
Through the end of 1995, Support Payments received by the Trust totaled
$2,074,000. In 1996 and the first two quarters of 1997 Santa Fe recouped all
such Support Payments and future recoupments will be made only to the extent of
future Support Payments. Depending on factors such as sales prices and volumes
and the level of operating costs and capital expenditures, Support Payments may
be required in subsequent quarters to allow the Trust to make distributions of
$0.40 per Trust Unit per quarter.

      Trust expenses include accounting, engineering, legal and other
professional fees, Trustee fees, an administrative fee paid to Santa Fe and
other out-of-pocket expenses. From time to time Santa Fe may, at its sole
discretion and without any obligation to do so, advance funds to the Trust for
the timely payment of such expenses and receive reimbursement therefor in later
periods. In addition, the Trustee is authorized to borrow funds required to pay
liabilities of the Trust, provided that such borrowings are repaid in full prior
to making further distributions to the holders of the Trust Units. Currently
there are no such borrowings outstanding or contemplated other than the
above-described advances which Santa Fe has made or may continue to make.

      The Trust's results of operations are dependent upon the sales prices and
quantities of oil and gas produced from the Royalty Properties, the costs of
producing such resources and the amount of capital expenditures made with
respect to such properties. Royalty income is recorded by the Trust when
received, generally during the 
                                       7
<PAGE>
quarter following the end of the quarter in which revenues are received and
costs and expenses are paid by Santa Fe. Cash proceeds from the Royalty
Properties may fluctuate from quarter to quarter due to the timing of receipts
and payments of revenues and expenses as well as changes in prices and
production volumes. In addition, amounts for future exploration and development
costs may be reserved from time to time.

      Since, on an equivalent basis, the majority of the Trust's proved reserves
are crude oil, even relatively modest changes in crude oil prices may
significantly affect the Trust's revenues and results of operations. Crude oil
prices are subject to significant changes in response to fluctuations in the
domestic and world supply and demand and other market conditions as well as the
world political situation as it affects OPEC, the Middle East and other
producing countries. In addition, a substantial portion of the Trust's revenues
come from properties which produce sour (i.e., high sulfur content) crude oil
which sells at prices lower than sweeter (i.e., low sulfur content) crude oils.
The Trust's average price for crude oil, which was $21.23 per barrel in the
second quarter of 1997, declined to $17.38 per barrel in the third quarter of
1997 and declined to $16.70 per barrel in the fourth quarter of 1997.

Natural gas prices fluctuate due to weather conditions, the level of natural gas
in storage, the relative balance between supply and demand and other economic
factors. The Trust's average price for natural gas, which was $3.12 per Mcf in
the second quarter of 1997, declined to $2.36 per Mcf in the third quarter of
1997 and declined to $2.06 per Mcf in the fourth quarter. (see -- Results of
Operations).
                                       8
<PAGE>
RESULTS OF OPERATIONS

      Royalty income is recorded by the Trust when received, generally during
the quarter following the end of the quarter in which revenues are received and
costs and expenses are paid by Santa Fe. Cash proceeds from the Royalty
Properties may fluctuate from quarter to quarter due to the timing of receipts
and payments of revenues and costs and expenses as well as changes in prices and
production volumes. The following table reflects pertinent information with
respect to the cash proceeds from the Royalty Properties and the net
distributable cash of the Trust. The information presented with respect to the
fourth quarter of 1997 reflects revenues received and costs and expenses paid by
Santa Fe in the third quarter of 1997. On November 28, 1997 the Trust will make
a cash distribution of $2,868,200, or $0.45527 per Trust Unit, to unitholders of
record on November 14, 1997.
<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED                 NINE MONTHS ENDED              FOURTH
                                                             SEPTEMBER 30,                     SEPTEMBER 30,    
                                                      -------------------------       -----------------------------        QUARTER 
                                                        1997             1996             1997              1996             1997
                                                      ---------       ---------       -----------       -----------       ---------
<S>                                                      <C>             <C>              <C>               <C>              <C>   
VOLUMES AND PRICES
 Oil volumes (Bbls):
  Wasson ODC royalty ...........................         66,800          64,600           198,200           193,000          66,800
  Wasson Willard royalty .......................         31,100          32,400            94,600            98,600          31,100
  Net profits royalty ..........................         74,694          71,685           228,178           228,225          72,041
 Gas volumes (Mcf):
  Net profits royalty ..........................        506,444         595,150         1,776,869         1,978,812         718,478
 Oil average prices ($/Bbl):
  Wasson ODC royalty ...........................      $   17.69       $   21.31       $     20.47       $     18.98       $   17.02
  Wasson Willard royalty .......................          17.69           21.32             20.52             18.94           16.99
  Net profits royalty ..........................          16.96           18.63             19.46             16.41           16.27
 Gas average prices ($/Mcf):
  Net profits royalty ..........................           2.36            1.98              2.48              1.72            2.06

CASH PROCEEDS AND DISTRIBUTABLE CASH
(IN THOUSANDS, EXCEPT PER UNIT DATA)
 Wasson ODC royalty:
  Sales ........................................      $   1,182       $   1,377       $     4,058       $     3,663       $   1,137
  Operating expenses ...........................           (129)           (131)             (408)             (370)           (128)
                                                      ---------       ---------       -----------       -----------       ---------
                                                          1,053           1,246             3,650             3,293           1,009
                                                      ---------       ---------       -----------       -----------       ---------
 Wasson Willard royalty:
  Sales ........................................            550             691             1,941             1,868             528
  Operating expenses ...........................            (49)            (56)             (164)             (179)            (48)
                                                      ---------       ---------       -----------       -----------       ---------
                                                            501             635             1,777             1,689             480
                                                      ---------       ---------       -----------       -----------       ---------
 Net profits royalty:
  Sales ........................................          2,528           2,555             8,942             7,186           2,659
  Operating expenses ...........................           (797)           (810)           (2,580)           (2,479)           (766)
  Capital expenditures .........................           (358)           (161)             (819)             (405)           (407)
                                                      ---------       ---------       -----------       -----------       ---------
                                                          1,373           1,584             5,543             4,302           1,486
                                                      ---------       ---------       -----------       -----------       ---------

 Support payment (recoupment) ..................           --              (375)           (1,065)             (492)           --
                                                      ---------       ---------       -----------       -----------       ---------

 Total royalties ...............................          2,927           3,090             9,905             8,792           2,975

 Administrative fee to Santa Fe ................            (57)            (55)             (169)             (162)            (57)
                                                      ---------       ---------       -----------       -----------       ---------
 Payment received ..............................          2,870           3,035             9,736             8,630           2,918
 Cash advance from Santa Fe ....................           --              --                --                 200            --
 Repayment of cash advance from Santa-Fe .......           --              (100)             --                (225)           --
 Cash withheld for trust expenses ..............            (50)           (100)             (250)             (377)            (50)
                                                      ---------       ---------       -----------       -----------       ---------
 Distributable cash ............................      $   2,820       $   2,835       $     9,486       $     8,228       $   2,868
                                                      =========       =========       ===========       ===========       =========

 Distributable cash per unit ...................      $ 0.44757       $ 0.45000       $   1.50569       $   1.30609       $ 0.45527
                                                      ---------       ---------       -----------       -----------       ---------
</TABLE>
                                       9
<PAGE>
      The distribution for the second quarter of 1997 of $0.60812 per Unit was
the highest since the inception of the Trust and reflected the small amount of
the remaining recoupment of Support Payments and the high sales prices received
for oil and gas produced in the latter part of the fourth quarter of 1996 and
early in the first quarter of 1997. Such prices began to decline in February
1997 and the distribution for the fourth quarter of 1997 will total $0.45527 per
Unit.

      Oil prices in the third quarter of 1997, averaged $17.69 per barrel for
the Wasson Royalties and $16.96 per barrel for the Net Profits Royalties
compared with $21.31 per barrel and $18.63 per barrel, respectively, in the
third quarter of 1996. Oil prices for the first nine months of 1997 averaged
$20.49 per barrel for the Wasson Royalties and $19.46 per barrel for the Net
Profits Royalties compared with $18.97 per barrel and $16.41 per barrel,
respectively, in the first nine months of 1996. Oil prices in the fourth quarter
of 1997 averaged $17.01 per barrel for the Wasson Royalties and $16.27 per
barrel for the Net Profits Royalties.

      Natural gas prices in the third quarter of 1997 averaged $2.36 per Mcf
compared with $1.98 per Mcf in the third quarter of 1996. Natural gas prices
averaged $2.48 per Mcf in the first nine months of 1997 compared with $1.72 per
Mcf in the first nine months of 1996. Natural gas sales prices averaged $2.06
per Mcf in the fourth quarter of 1997. Natural gas volumes decreased in the
third quarter of 1997 due to the settlement of gas imbalances on certain
properties totalling approximately 95,000 Mcf, and increased in the fourth
quarter of 1997 as an effect of the third quarter imbalance settlements and
timing of receipts.

      Cash proceeds in the first nine months of 1997 were reduced by Support
Payment recoupments of $1,065,000; all Support Payments have been recouped.
Future recoupments will be made only to the extent of future Support Payments.
(see -- General; Liquidity and Capital Resources).

      Proceeds from the Net Profits Royalties are net of capital expenditures
with respect to the exploration and development of the Net Profits Properties.
Capital expenditures for the first nine months of 1997 totalled $819,000 and
will total approximately $1,226,000 for the year 1997. Operating expenses for
the Net Profits Royalties averaged $4.92 per barrel of oil equivalent ("BOE") in
the third quarter of 1997 compared with $4.74 per BOE in the third quarter of
1996 primarily due to higher production and severance taxes and the timing of
the payment of costs and expenses. Such expense for the fourth quarter of 1997
averaged $3.99 per BOE.

FORWARD LOOKING STATEMENTS

      Management's Discussion and Analysis of Financial Condition and Results of
Operations includes certain statements (other than statements of historical
fact) that constitute forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. When used herein, the words "anticipates," "expects," "believes,"
"intends" or "projects" and similar expressions are intended to identify
forward-looking statements. It is important to note that actual results could
differ materially from those projected by such forward-looking statements.
Although it is believed that the expectations reflected in such forward-looking
statements are reasonable and such forward-looking statements are based upon the
best data available at the time this report is filed with the Securities and
Exchange Commission, no assurance can be given that such expectations will prove
correct. Factors that could cause results to differ materially from the results
discussed in such forward-looking statements include, but are not limited to,
the following: production variances from expectations, volatility of oil and gas
prices, the need to develop and replace reserves, the capital expenditures
required to fund operations, exploration risks, environmental risks,
uncertainties about estimates of reserves, competition and government regulation
and political risks. All such forward-looking statements in this document are
expressly qualified in their entirety by the cautionary statements in this
paragraph.
                                       10
<PAGE>
PART II.    OTHER INFORMATION

ITEMS 1, 2, 3, 4 & 5 ARE NOT APPLICABLE AND HAVE BEEN OMITTED.

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K
(a)  Exhibits
                                                     SEC FILE OR
                                                     REGISTRATION     EXHIBIT
                                                       NUMBER         NUMBER
                                                     ------------    ----------
3(a)*     Form  of  Trust   Agreement  of  Santa  Fe
          Energy Trust                                33-51760       3.1
          
4(a)*     Form of Custodial Deposit Agreement         33-51760       4.2

4(b)*     Form of Secure  Principal  Energy  Receipt
          (included as Exhibit A to Exhibit 4(a))     33-51760       4.1
          Form of Net Profits Conveyance

10(a)*    (Multi-State)                               33-51760       10.1
          
10(b)*    Form of Wasson Conveyance                   33-51760       10.2
          
10(c)*    Form of Louisiana Mortgage                  33-51760       10.3

27        Financial Data Schedules

(*) Indicates exhibit filed incorporated herein by reference
      
(b)  Reports on Form 8-K
          None
                                       11
<PAGE>
                                    SIGNATURE

Pursuant to the requirements Section 13 or 15 (d) of the Securities Exchange Act
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized, on the 14th day of November, 1997.

                                         SANTA FE ENERGY TRUST
                                              (Registrant)

                                    By:  TEXAS COMMERCE BANK NATIONAL
                                           ASSOCIATION, TRUSTEE

Date:  NOVEMBER 14, 1997            /s/  PETE FOSTER
                                         Pete Foster
                                         Senior Vice President & Trust Officer


      The Registrant, Santa Fe Energy Trust, has no principal executive officer,
principal financial officer, controller or principal accounting officer, board
of directors or persons performing similar functions. Accordingly, no additional
signatures are available and none have been provided.