U.S. Securities And Exchange Commission
                       Washington, D.C. 20549

                            Form 10-QSB/A

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

For the quarterly period ended June 30, 1998.

[ ]   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 0-20760

                     HORIZONTAL VENTURES, INC.
 (Exact name of small business issuer as specified in its
charter)

        COLORADO                             84-1091986
(State or other jurisdiction              (I.R.S. Employer
of incorporation of organization)        Identification No.)

        630 Fifth Avenue, Suite 1501, New York, NY 10111
           (Address of principal executive office)     


Issuer's telephone number: (212) 218-4680 

        Petro Union, Inc. d/b/a Horizontal Ventures, Inc.
              575 Madison Avenue, Suite 1006
                    New York, NY  10022
(Former name, former address and former fiscal year, if changed
since last report)

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

        APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
            PROCEEDINGS DURING THE PRECEDING FIVE YEARS

     Check whether the registrant filed all documents and
reports required to be filed by Section 12, 13, or 15(d) of the
Exchange Act after the distribution of securities under a plan
confirmed by court.  Yes   X     No      

             APPLICABLE ONLY TO CORPORATE ISSUERS

    State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest practicable
date:

Common Stock, no par value, outstanding at August 14, 1998:
1,570,981 shares

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

Explanation of Amendment to June 30, 1998 Form 10-QSB:

The original Quarterly Report on Form 10-QSB for the quarter
ended June 30, 1998 is amended hereby solely to correct a
typographical error with respect to the net loss per common share
for the six months ended June 30, 1997 reported in the original
Form 10-QSB's Consolidated Statements of Operations for the Three
Months and Six Months Ended June 30, 1998 and 1997 (Unaudited). 
Net loss per common share for the six months ended June 30, 1997
as presented in this amended Form 10-QSB was $(0.25), and not
$(.025) as indicated in the original Form 10-QSB.

                        TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements
                                                             
     Consolidated Balance Sheet as of June 30, 1998
        (Unaudited)                                               
     
     Consolidated Statements of Operations for the 
        Three Months and Six Months Ended June 30, 1998
        and 1997 (Unaudited)                                      

     Consolidated Statements of Cash Flows for the Six
        Months Ended June 30, 1998 and 1997 (Unaudited)         

     Notes to Unaudited Consolidated Financial Statements,
        June 30, 1998 and 1997 (Unaudited)       

Item 2.  Management's Discussion and Analysis                

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

Item 2.  Changes in Securities and Use of Proceeds

Item 3.  Defaults Upon Senior Securities

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

Item 5.  Other Information

Item 6.  Exhibits and Reports on Form 8-K

SIGNATURE


                    PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

                     HORIZONTAL VENTURES, INC.
                    CONSOLIDATED BALANCE SHEET
                    June 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
                               ASSETS
<S>                                           <C>
CURRENT ASSETS:
  CASH AND CASH EQUIVALENTS                     $1,415,388    
  ACCOUNTS RECEIVABLE:
    TRADE, NET OF ALLOWANCE FOR
    DOUBTFUL ACCOUNTS OF $74,092                    14,009
                                               _______________ 
 TOTAL CURRENT ASSETS                            1,429,397
                                               _______________
PROPERTIES AND EQUIPMENT,
  AT COST, NET OF ACCUMULATED DEPRECIATION
  AND DEPLETION OF $707,292                      7,733,361
                                               _______________
  OTHER ASSETS:                 
   DEPOSITS, PREPAYMENTS, AND
     DEFERRED CHARGES                              300,764
                                               _______________    
       TOTAL ASSETS                             $9,463,522
                                              ================

         LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

LIABILITIES:
CURRENT LIABILITIES:
  CURRENT MATURITIES OF LONG TERM NOTES         $   15,771
  ACCOUNTS PAYABLE AND ACCRUED EXPENSES            115,168    
  OTHER CURRENT LIABILITIES                          8,834   
                                              ________________
TOTAL CURRENT LIABILITIES                           139,773
                                              ________________
NONCURRENT LIABILITIES:
LONG TERM NOTES PAYABLE, NET
  OF CURRENT MATURITIES                             58,318
                                             ________________     
    
TOTAL LIABILITIES                                  198,091
                                             _________________

COMMITMENTS AND CONTINGENCIES                         -

STOCKHOLDERS' EQUITY (DEFICIT):
  COMMON STOCK, NO PAR VALUE,
  50,000,000 SHARES AUTHORIZED,
  1,570,981 SHARES ISSUED AND
  OUTSTANDING                                   11,672,519
  ACCUMULATED DEFICIT                           (2,407,088)
                                            ________________

  TOTAL STOCKHOLDERS' EQUITY                     9,265,431
                                            _________________
  TOTAL LIABILITIES AND
   STOCKHOLDERS' EQUITY                         $9,463,522
                                            ==================
</TABLE>


The accompanying notes are an integral part of these statements.


                     HORIZONTAL VENTURES, INC.
              CONSOLIDATED STATEMENTS OF OPERATIONS       
             FOR THE THREE MONTHS AND SIX MONTHS ENDED 
                      JUNE 30, 1998 AND 1997
                          (UNAUDITED)
<TABLE>
<CAPTION>
                  THREE MONTHS ENDED       SIX MONTHS ENDED 
                      JUNE 30,                   JUNE 30, 
                   1998         1997       1998         1997
<S>              <C>         <C>       <C>           <C>
REVENUE           $86,970     $25,847   $121,659      $129,165

COST OF REVENUE    30,381      37,964     64,553       113,864

GROSS PROFIT       56,590     (12,117)    57,106        15,301

GENERAL AND 
 ADMINISTRATIVE 
 EXPENSES         436,482      58,997    829,897      172,086

INCOME (LOSS) 
 FROM OPERATIONS (379,892)    (71,114)  (772,791)    (156,785)

OTHER INCOME 
 (EXPENSES)        15,009     (44,209)    49,603      (36,365)

INCOME (LOSS)
 BEFORE TAXES 
 ON INCOME       (364,884)   (115,323)  (723,188)    (193,150)

PROVISION FOR 
 INCOME TAXES         -           -           -            -

NET INCOME 
(LOSS)          $(364,884)  $(115,323) $(723,188)   $(193,150)

NET EARNINGS 
 (LOSS) PER 
 COMMON SHARE     $(0.23)   $(0.15)       $(0.46)      $(0.25) 

AVERAGE SHARES 
 OUTSTANDING USED 
 FOR COMPUTATION 
 OF EARNINGS 
 (LOSS) PER 
 SHARE         1,570,981   759,460     1,570,981      759,460   

</TABLE>

The accompanying notes are an integral part of these statements.

                      HORIZONTAL VENTURES, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS
           FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
                            (UNAUDITED)
<TABLE>
<CAPTION>
                                      SIX MONTHS ENDED JUNE 30, 
                                        1998             1997
<S>                                <C>               <C>
CASH FLOWS FROM OPERATING 
ACTIVITIES: 
  NET (LOSS)                         $(723,188)       $(193,150)
    ADJUSTMENTS TO RECONCILE 
    NET LOSS TO CASH PROVIDED 
    (USED) BY OPERATIONS: 
      DEPRECIATION, DEPLETION 
        AND AMORTIZATION               109,366           93,324
      (GAIN) LOSS ON SALE OF ASSETS       -              21,062
      STOCK AND PARTNERS' CAPITAL 
        INTEREST ISSUED FOR SERVICES      -                 300
      CHANGE IN ACCOUNTS RECEIVABLE      3,173           45,740
      CHANGE IN INTERESTS RECEIVABLE     3,433              -
      CHANGE IN PAYMENT IN ADVANCE      (8,669)           6,668
      CHANGE IN ACCOUNTS PAYABLE      (150,579)         (28,898)
      CHANGE IN OTHER LIABILITIES     (681,011)             -

NET CASH (USED) BY OPERATING 
ACTIVITIES                          (1,447,476)         (54,954)

CASH FLOWS FROM INVESTING 
ACTIVITIES: 
  (INCREASE) IN PROPERTY 
     AND EQUIPMENT                  (1,033,692)         (82,980)
   INCREASE IN DEPOSITS               (101,771)             -
   INCREASE IN ACCOUNTS RECEIVABLE,
     PETRO UNION, INC.                     -             (9,170)
   PROCEEDS FROM SALE OF PROPERTY 
     AND EQUIPMENT                         -             55,181

NET CASH (USED) BY INVESTING
ACTIVITIES                          (1,135,463)         (36,969)

CASH FLOWS FROM FINANCING 
ACTIVITIES:
  PROCEEDS FROM COMMON STOCK - NET      84,446          154,858
  PROCEEDS FROM PREFERRED STOCK-NET        -             30,000
  INCREASE IN DUE TO RELATED PARTIES       -             60,478
  CHANGE IN CUSTOMER PAYMENTS 
    RECEIVED IN ADVANCE                    -            (30,000)
  REPAYMENT OF NOTES PAYABLE           (18,768)        (119,346)

NET CASH PROVIDED BY FINANCING
ACTIVITIES                              65,678           95,990

NET INCREASE (DECREASE) IN CASH 
AND CASH EQUIVALENTS                (2,517,260)           4,067

CASH AND CASH EQUIVALENTS: 
  BEGINNING OF PERIOD                3,932,647            6,458
  END OF PERIOD                      1,415,388           10,525

NET INCREASE (DECREASE) IN 
CASH AND CASH EQUIVALENTS          $(2,517,260)          $4,067


The accompanying notes are an integral part of these statements.

</TABLE>

                    HORIZONTAL VENTURES, INC.
      Notes to Unaudited Consolidated Financial Statements
                     June 30, 1998 and 1997
                           (Unaudited)


NOTE 1 - THE COMPANY:
Horizontal Ventures, Inc., a Colorado corporation (the "Company"),
is engaged in the development of oil and gas properties for its own
account and the contract drilling of oil and gas wells.  On July
13, 1998, the Company amended its Articles of Incorporation to
change its name from Petro Union, Inc. d/b/a Horizontal Ventures,
Inc. to Horizontal Ventures, Inc.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:

Basis of presentation - The consolidated financial statements
include the accounts of the Company and its wholly owned
subsidiaries, HVI Cat Canyon, Inc., a Colorado corporation, and
Calox, Inc.  All significant intercompany accounts and transactions
have been eliminated. 

The results for the interim periods presented herein are not
necessarily indicative of the results of operations that may be
expected for the upcoming quarters.  In the opinion of management,
the information furnished reflects all adjustments necessary (which
all are of a normal recurring nature) for a fair presentation of
the Company's financial position as of June 30, 1998, and the
results of its operations and cash flows for the interim periods
ended June 30, 1998 and 1997.

The financial statements for the interim periods have been prepared
pursuant to the rules and regulations of the Securities and
Exchange Commission.  Certain information and footnote disclosures
normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed
or omitted pursuant to such rules and regulations. The financial
statements presented herein should be read in conjunction with the
financial statements for the year ended December 31, 1997 included
in the Company's 1997 Annual Report on Form 10-KSB.

The Company, then named Petro Union, Inc. ("PUI"), was a debtor in
possession under Chapter 11 of the U.S. Bankruptcy Code until
August 28, 1997, at which time the Bankruptcy Court approved its
plan of reorganization.  As a part of its plan of reorganization,
PUI agreed to acquire all the outstanding stock of Horizontal
Ventures, Inc., an Oklahoma corporation ("HVI-Oklahoma"). The
acquisition of HVI-Oklahoma was completed on September 9, 1997, and
after the acquisition, HVI-Oklahoma shareholders owned more than
50% of the outstanding shares of PUI.  Pursuant to the rules of the
Securities and Exchange Commission, the transaction was accounted
for as a "reverse merger."  Accordingly, the accompanying
consolidated statements of operations and consolidated statements
of cash flows reflect the historical operations and cash flows of
HVI-Oklahoma (including those of PUI after September 9, 1997, the
effective date of the merger), whereas quarterly reports filed by
the Company prior to September 9, 1997 reflected operations and
cash flows of PUI.  Subsequently, HVI-Oklahoma was merged with and
into the Company.

Certain reclassifications have been made to the 1997 amounts to 
conform to the 1998 presentation.  

Earnings per share - Earnings per share for the three months and
six months ended June 30, 1998 and 1997 have been calculated based
on the average number of shares outstanding during such periods.

NOTE 3 - CONTINGENCIES: 

At June 30, 1998, the Company was the plaintiff in a lawsuit 
against David J. LaPrade, a shareholder, former officer and 
director, and an organizer of HVI-Oklahoma, and Mr. LaPrade's 
current employer.  The Company seeks to recover losses from the 
alleged breach of fiduciary duty, misappropriating confidential 
information and property of the Company, using it in unfair 
competition with the Company, interfering with the Company's 
existing and prospective relationships with its customers, 
interfering with the Company's relationships with its employees, 
and conversion of Company property.   Mr. LaPrade has made 
counterclaims against the Company for breach of his employment 
agreement, libel and slander, and intentional infliction of 
emotional distress; he seeks actual damages in excess of $10,000 
and punitive damages in an unspecified amount.  Management 
believes that its claims against Mr. LaPrade will be successful 
and that it will recover damages; moreover, management believes 
that the ultimate outcome of Mr. LaPrade's counterclaim will not
have a material adverse effect on the Company's financial
condition, results of operations or cash flows.   The accompanying
financial statements do not include a provision for any loss which
might result from Mr. LaPrade's counterclaim, nor do they include
any asset that might result from the Company's claims against Mr.
LaPrade. 

NOTE 4 - SUBSEQUENT EVENTS:

On July 13, 1998, the Company amended its Articles of Incorporation
to among other things authorize the issuance of 50,000,000 shares
of no par value preferred stock with rights and preferences as the
Company's Board of Directors may determine.
<PAGE>
                       PART I (CONTINUED)

Item 2.  Management's Discussion and Analysis

Overview

The Company's final accounting of the bankruptcy case was
accepted and the case was closed by the Bankruptcy Court for the
Southern District of Indiana on March 26, 1998. This marked the
end of almost a year of re-structuring by the Company. Management
spent a considerable amount of its time in this process and
intends to now focus on implementing its business strategy
hereon. 

The results of the second quarter ended June 30, 1998, as
planned, relate to the Company's internal drilling program in
California and thus reflect the investment phase. In the view of
management, the current financials statements are not indicative
of the Company's potential and business plan.  Over the last
year, the Company has re-structured both corporately and
internally and successfully implemented its horizontal technology
in the reservoirs in California and thus been in an investment
phase.  This investment into its pilot program in California has
proven the technical and financial benefits of the Company's
technology in those reservoirs.  Management expects this
investment to be rewarded as a result of an acquisition or joint
venture whereby this pilot program is implemented on a
significantly larger scale.  The Company's current cost structure
can support three operative drilling crews in the field without
any additional capital.  Thus management is focused on deploying
its crews to the field on either its own properties through an
acquisition or under a joint venture program.

In the first half of 1998, the Company drilled three horizontal
wells namely, UCB-09, UCB-38 and UCB-28. Each well was drilled
successfully utilizing the Company's Short radius technology and
resulted in a 47 ft radius with a 435 ft lateral on UCB-09, a
60ft radius with a 414 ft lateral on UCB-38 and a 50ft radius
with a 252 ft lateral on UCB-28. In view of the Company's long-
term strategy and the known sand problem in the Cat Canyon basin,
the Company completed each well with a different technique to
establish the standard. UCB-09 was completed with a standard Ace
down-hole pump and a KD system; UCB-38 with a KUDU pump while
UCB-28 was completed with a Ace Teflon-Luber Plunger down-hole
pump. The kick-off point (KOP) for each well was at a depth of
2,940-3,000 ft.

The variances in the completions proved to be extremely
successful as the Company attained direct experience on the
production capability from each of the techniques. UCB-09
production stabilized at 20 BOPD, UCB-38 got sanded up following
a few weeks of production while UCB-28 produces a net of 65 BOPD.
Each of these wells were re-entries into an abandoned well bore
in the Sisquoc formation which is one of the two pay zones within
the Company's lease in the Cat Canyon basin. Following this
successful drilling operation and completion technique
definition, the Company intends to resume its drilling program
early in the fourth quarter of 1998 to achieve its 500 BOPD
objective by year-end. 

This Quarterly Report on Form 10-QSB includes certain statements
that may be deemed to be "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as
amended.  All statements, other than statements of historical
facts, included in this Form 10-QSB that address activities,
events or developments that the Company expects, believes or
anticipates will or may occur in the future, including such
matters as future capital, development and exploration
expenditures (including the amount and nature thereof), drilling
of wells, reserve estimates (including estimates of future net
revenues associated with such reserves and the present value of
such future net revenues), future production of oil and gas,
repayment of debt, business strategies, expansion and growth of
the Company's operations and other such matters are forward-
looking statements.  These statements are based on certain
assumptions and analyses made by the Company in light of its
experience and its perception of historical trends, current
conditions, expected future developments and other factors it
believes are appropriate in the circumstances.  Such statements
are subject to a number of assumptions, risks and uncertainties,
general economic and business conditions, the business
opportunities (or lack thereof) that may be presented to and
pursued by the Company, changes in laws or regulations and other
factors, many of which are beyond the control of the Company. 
Readers are cautioned that any such statements are not guarantees
of future performance and that actual results or developments may
differ materially from those projected in the forward-looking
statements.

The sharp decline (over 50%) in the oil prices during the first
half of 1998 had a negative effect on the Company's revenues. As
the Company has successfully stabilized its lifting costs to
under $4 per barrel from over $6 per barrel, the Cat Canyon
operation continues to be profitable. 

The Company re-organized its management team at the end of March
1998 to better poise itself in implementing its two-prong
(exploitation and contract drilling) business strategy. The
Evansville offices were closed in late April and all operations
are now based in Tulsa in an effort to reduce G&A expenses and
consolidate  operations.

As per the Company's business strategy, management is actively
pursuing  acquisitions and currently is involved in due diligence
on one. Management expects to complete its first acquisition in
the third quarter. The acquisition, if completed, will add
production, drilling sites and cash flow to the Company and is
expected to positively affect liquidity. 

The down turn in oil prices in the first half of 1998 has
deferred the drilling programs of some of the Company's
prospective contract drilling clients.  Clients that had planned
to start drilling late second/early third quarter have now
indicated a desire to defer such programs into the fourth quarter
to observe the oil prices closer.

In view of the vast differences between the Company's structure
in the three months and six months ended June 30, 1997 and that
in the comparable periods ended June 30, 1998, the results of
operations comparisons are considered by management to be not
representative of the Company's potential. The liquidity
comparisons reflect the successful re-structuring process
accomplished by the management over the last nine months. The
management does not foresee any additional capital requirements
to continue its on-going operations through next year.

Results of Operations

Comparison of Three-Month Periods Ended June 30, 1998 and 1997

Revenues increased from $25,847 in the second quarter of 1997 to
$86,970 in the second quarter of 1998.  Second quarter 1998
revenues were from oil production at the recently acquired field
in California and timber sales from its Indiana properties. The
Company commenced its contract drilling sales activities in the
second quarter of 1998 following over a year of not promoting its
services during the corporate restructuring process.   

Cost of Revenue decreased from $37,964 in the second quarter of
1997 to $30,381 in the second quarter of 1998. Planned drilling
operations in California account for most of the expenses, and
the decrease as compared to the increase in revenues was
primarily attributable to the timber sales. 

General and Administration expenses increased from $58,997 in the
second quarter of 1997 to $436,482 in the second quarter of 1998. 
Considerable re-structuring with the closing of the Evansville
offices reduced the General and Administration expenses from the
first quarter as the offices were closed in April.  The benefit
of this reduction is expected to be positively reflected in the
upcoming quarters.

Comparison of Six Month Periods Ended June 30, 1998 and 1997

Revenues decreased from $129,165 in the first half of 1997 to
$121,659 in the first half of 1998. First half 1998 revenues were
from oil production at the recently acquired field in California.
The decline in oil prices of over 50% coupled with the El Nino
storms that essentially shut the field down during February 1998
caused the revenues to be lower than initially projected.
Furthermore, two of the three horizontal wells drilled by the
Company attributed to a small percentage of the total production
as they were put on production late in the first quarter of 1998.
The Company commenced its contract drilling activities in the
second quarter of 1998 following over a year of not promoting its
services during the corporate restructuring process.   

Cost of Revenue decreased from $113,864 in the first half of 1997
to $64,553 in the first half of 1998. Planned drilling operations
in California account for most of the expenses and are not
proportional to the revenues, as the three horizontal wells
drilled were not in production during the entire first half of
1998. Additionally, there was considerable El Nino-created
remedial repair expenses incurred during the month of February
1998.

General and Administration expenses increased from $172,086 in
the first half of 1997 to $829,897 in the first half of 1998. 33%
of the expenses were related to payroll. 25% of the expenses were
related to legal, accounting and consultant fees primarily
involved with year-end reporting and filing requirements. General
and Administration expenses are expected to remain relatively
consistent with the start-up of the contract drilling operations
in the upcoming quarters.

Liquidity and Capital Resources

At the end of the second quarter, the Company's liquid assets
consisting of  cash and cash equivalents were $1,415,388 while
current liabilities were $139,773.  The $1,857,319 decrease in
working capital from December 31, 1997 to June 30, 1998 was
primarily attributable to the Company's drilling program in its
Cat Canyon field in California and the final payment on the Cat
Canyon field.  Additionally, in the first quarter of 1998 the
Company settled the previously-reported Gwartney litigation for
$25,000. Long-term liabilities as of June 30, 1998 were $58,318.

The Company expects the current liquidity to be sufficient to
support the on-going operations through next year without any
additional funding requirements.

Inflation 

The Company does not believe that inflation will have a material
impact on the Company's future operations.

Year 2000 Issue

The Company does not utilize any proprietary computer software. 
Instead, it uses commercially available software programs from
vendors such as Microsoft Corporation and Peachtree.  The Company
has been advised that the software it uses is Year 2000
compliant.  Accordingly, the Company does not expect to incur
significant expense in converting software to be Year 2000
compliant.



                   PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

As previously reported in the Company's 1997 Annual Report on
Form 10-KSB, on March 11, 1997 HVI-Oklahoma commenced a lawsuit
in the District Court for Tulsa County, Oklahoma against David J.
LaPrade, a shareholder, former officer and director, and an
organizer of the HVI-Oklahoma, and Mr. LaPrade's current
employer. The Company seeks to recover losses from alleged breach
of fiduciary duty, misappropriating confidential information and
property of the Company, using it in unfair competition with the
Company, interfering with the Company's existing and prospective
relationships with its customers, interfering with the Company's
relationships with its employees, and conversion of the Company
property.  Mr. LaPrade has made counterclaims against the Company
for breach of his employment agreement, libel and slander, and
intentional infliction of emotional distress; he seeks actual
damages in excess of $10,000 and punitive damages in an
unspecified amount.  As of June 30, 1998, the lawsuit was still
pending.  The Company believes that the ultimate outcome of this
litigation will not have a material adverse effect on the
Company's financial condition, results of operations or cash
flows.

Item 2.  Changes in Securities and Use of Proceeds

         None.

Item 3.  Defaults upon Senior Securities

         None.

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

         On July 2, 1998, the Company held its annual meeting of
shareholders.  At that meeting the following matters were voted
upon as indicated below:

            1.  Election of the following directors to serve
during the ensuing year or if the staggered terms proposal
passes, until their successors are elected and qualified.

                                     For         Withheld

           Randeep S. Grewal      1,168,203         634
           Dr. Jan F. Holtrop     1,168,170         667 
           George C. Andrews      1,168,203         634
           Dirk Van Keulen        1,168,171         666 
           Donald A. Christensen  1,168,204         633 

          2. Adoption of the Company's Amended and Restated
Articles of Incorporation containing the following provisions:
(i) Changing the name of the Company to Horizontal Ventures,
Inc.; (ii) Providing for the number of Directors to be
established by the Bylaws and further providing for staggered
terms for the Company's Directors; (iii) Authorizing the issuance
of 50,000,000 shares of no par value preferred stock with rights
and preferences as the Board of Directors may determine; (iv)
Changing voting requirements to: (a) reduce the voting
requirement for shareholder actions initiated by the Board of
Directors; and (b) increase the voting requirement for
shareholder actions not initiated by the Board of Directors; and
(v) reducing the quorum requirement from shares representing a
majority of the outstanding voting rights to shares representing
one-third of the outstanding voting rights.

             For: 914,430
             Against: 4,285
             Abstain: 146
             Broker non-votes: 249,976

         3.  Approval of the Horizontal Ventures, Inc. Non
Qualified Stock Option Plan.

             For: 911,322
             Against: 2,455
             Abstain: 5,084
             Broker non-votes: 249,976

             4.  Authorization of the Board of Directors to issue
up to 1,000,000 shares of the Company's no par value common or
preferred stock for equity offerings both private and public and
for the acquisition of assets or businesses.

             For: 915,717
             Against: 3,048
             Abstain: 96
             Broker non-votes: 249,976    

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8-K

            (a)    Exhibits

         Exhibit No.      Description

         3A               Restated Articles of Incorporation

         27               Financial Data Schedule

         (b)              Reports on Form 8-K

         During the quarter for which this report is filed, the
         Company did not file any Reports on Form 8-K.

          
                            SIGNATURE

    In accordance with requirements of the Exchange Act, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.



                                     HORIZONTAL VENTURES, INC.

Date: August 18, 1998                by: /S/ RANDEEP S. GREWAL
                                     Randeep S. Grewal, Chief     
                                     Executive Officer