FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   (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, 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 0-20760

                            GREKA Energy Corporation

             ------------------------------------------------------
             (Exact name of registrant 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)

                                 (212) 218-4680

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

                                 Not applicable

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

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

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

     Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 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.  X Yes   No
                      ---   ---

<PAGE>

                  APPLICABLE ONLY TO CORPORATE ISSUERS

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

As of August 14, 2000,  GREKA had 4,339,940 shares of Common Stock, no par value
per share, outstanding.

                                TABLE OF CONTENTS

                                                                          Page

PART I - FINANCIAL INFORMATION .............................................3

Item 1.  Financial Statements...............................................3

   Condensed Consolidated Balance Sheets as of June 30, 2000
     (Unaudited) and December 31, 1999 .....................................3
   Condensed Consolidated Statements of Operations for the Six and
      Three Month Periods Ended June 30, 2000 and 1999 (Unaudited)..........4
   Condensed Consolidated Statements of Cash Flows for the
      Six Month Periods Ended June 30, 2000 and 1999 (Unaudited)............5
   Notes to Condensed Consolidated Financial Statements (Unaudited).........6

Item 2.  Management's Discussion and Analysis of Financial
   Condition and Results of Operation...................................... 9

Item 3.  Quantitative and Qualitative Disclosures About Market Risk........16

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.................................................17

Item 2.  Changes in Securities and Use of Proceeds.........................17

Item 3.  Defaults Upon Senior Securities...................................17

Item 4.  Submission of Matters to a Vote of Security Holders...............17

Item 5.  Other Information.................................................17

Item 6.  Exhibits and Reports on Form 8-K..................................18

SIGNATURE..................................................................18




















<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

                    GREKA ENERGY CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                  June 30,              December 31,
                                                                   2000                     1999
                                                                ------------            ------------
                                                                 (Unaudited)
<S>                                                              <C>                     <C>
Current Assets
        Cash and equivalents                                     $1,313,951              $   97,319
        Restricted cash                                             224,139               1,000,000
        Accounts receivable trade, net of
           allowance for doubtful accounts of
           $1,343,852 (1999)                                      7,297,385               4,681,823
        Inventories                                               5,145,432               4,253,277
        Other current assets                                      1,163,647               1,951,554
                                                                 ----------              ----------
                  Total Current Assets                           15,144,555              11,983,973
                                                                 ----------              ----------

Property and Equipment
        Investment in limestone property,
           at cost                                                3,675,973               3,675,973
        Oil and gas properties (full cost method)                29,969,435              29,653,061
        Land                                                     17,387,740              17,210,814
        Plant and equipment                                      27,400,325              26,875,661
                                                                 ----------              ----------
                                                                 78,433,473              77,415,509

        Less accumulated depletion, depreciation
           and amortization                                     (8,718,830)             (7,128,995)
                                                                 ----------              ----------
          Property and Equipment - Net                           69,714,643              70,286,514

        Other Assets                                              2,400,671               1,943,196
                                                                 ----------              ----------
                  Total Assets                                  $87,259,869             $84,213,683
                                                                 ==========              ==========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
        Accounts payable and accrued expenses                   $ 7,440,729             $ 8,235,627
        Current maturities of long term notes                     7,645,168              13,173,296
                                                                 ----------              ----------

                  Total Current Liabilities                      15,085,897              21,408,923

Long Term debt, net of current Portion                           24,537,321              20,446,510

Other Liabilities                                                 9,844,178               8,979,927

Stockholder's Equity
        Common Stock, no par value, 50,000,000
           Shares authorized, issued 4,339,940                   37,261,043              37,261,043
        Accumulated comprehensive income(loss)                      (19,243)                (19,243)
        Retained (deficit) earnings                                 550,673              (3,863,477)
                                                                 ----------              ----------
        Total Stockholders' Equity                               37,792,473              33,378,323
                                                                 ----------              ----------
                                                                $87,259,869             $84,213,683
                                                                 ==========              ==========
</TABLE>



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

                                        3
<PAGE>

                    GREKA ENERGY CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                    UNAUDITED

<TABLE>
<CAPTION>
                                                   Six Months Ended June 30,  Three Months Ended June 30,
                                                   -------------------------  --------------------------
                                                       2000        1999          2000           1999
                                                    ----------- -----------   -----------    -----------
<S>                                                 <C>         <C>           <C>            <C>
Revenues

                  Total Revenues                    $23,379,915 $ 9,048,558   $13,699,489    $ 8,695,456

Expenses
        Production costs                             12,439,433   4,648,400     7,016,569      4,435,414
        General and administrative                    3,124,510   1,587,002     1,720,221      1,162,267
        Depletion, depreciation and
           Amortization                               1,589,839   1,719,186       642,925      1,500,811
                                                     ----------   ---------     ---------      ---------
                  Total Expenses                     17,153,782   7,954,589     9,379,715      7,098,492

Operating Income (Loss)                               6,226,133   1,093,969     4,319,774      1,596,964


Other Income (Expense)
        Equity in pre-merger loss of Saba                    --    (553,483)           --             --
        Other                                                --     679,265            --        652,948
        Interest (expense)                           (1,811,984)   (646,271)     (784,614)      (542,851)
                                                     ----------   ---------     ---------      ---------
                  Other Income (Expense), Net        (1,811,984)   (520,489)     (784,614)       110,097


Income (Loss) before Income Tax                       4,414,150     573,480     3,535,160      1,707,061

Provision for Colombian Taxes                                --     472,100            --        472,100

Minority Interest in Loss (Earnings)
    of Consolidated Subsidiary                               --     (20,617)           --        (19,579)
                                                     ----------   ---------     ---------      ---------

Net Income                                           $4,414,160     121,997     3,535,160      1,254,540
                                                     ----------   ---------     ---------      ---------

Other Comprehensive Income                                   --       63,982            --        63,982
                                                     ----------   ---------     ---------      ---------

Net Comprehensive Income                            $ 4,414,160  $   185,979  $ 3,535,160    $ 1,318,522
                                                     ==========   ==========   ==========     ==========

Earnings per share
      Basic
      Net income per share                          $      1.02  $      0.03  $       .81    $      0.31
                                                     ==========   ==========   ==========     ==========

Diluted
      Net income per share                          $      0.99  $      0.03  $      0.80    $      0.31
                                                     ==========   ==========   ==========     ==========


Weighted average shares outstanding

      Basic                                           4,339,940    3,626,639    4,339,940      4,221,018
                                                     ==========   ==========   ==========     ==========
      Diluted                                         4,443,366    3,626,639    4,414,449      4,221,018
                                                     ==========   ==========   ==========     ==========
</TABLE>




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

                                 4
<PAGE>

                    GREKA ENERGY CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE SIX MONTH PERIODS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                          2000                    1999
                                                                      ------------           --------------
<S>                                                                     <C>                     <C>
Cash flows from Operating Activities

        Net Income                                                      $4,414,160              $121,997
        Adjustments to reconcile net
           income to net cash provided by(used for)
           operating activities
        Depletion, depreciation and

        Amortization                                                     1,589,839             1,719,186
        Equity in pre-merger loss of Saba                                       --               553,483
        Compensation Expense - Common Stock                                     --               150,000

        Changes in:

        Accounts receivable                                             (2,615,562)           (3,054,506)
          Other current assets                                           1,051,794              (116,128)
        Other assets                                                      (451,475)                   --
        Inventory                                                         (892,155)           (1,267,571)
        Accounts payable and accrued
           Liabilities                                                     794,898            (1,095,747)
        Minority interest in loss of subsidiary                                 --               (20,617)
                                                                        ----------            ----------

                  Net Cash Provided (Used)
                   in Operating Activities                               3,891,499               818,409
Cash Flows from Investing Activities

        Expenditures for property and equipment                         (1,137,964)             (474,403)
        Proceeds from sale of property                                     120,000                    --
        Acquisition of inventory                                                --             1,000,000
        Expenditures for acquisition of Saba,
           net of cash acquired                                                 --               234,850
                                                                        ----------            ----------
        Net Cash Used In

           investing Activities                                         (1,017,964)         (  1,239,553)
                                                                        ----------            ----------
Cash Flows from Financing Activities

        Proceeds from(payments of) notes payable and
           long-term debt                                               (3,904,617)           11,526,450
        Principal payments on notes
           payable and long-term debt                                   (5,381,696)           (7,219,733)
        Net increase in revolver loan                                      335,560                    --
        Payment of financing cost                                               --              (330,438)
                                                                        ----------            ----------
Net Cash Provided (Used) by Financing

        Activities                                                      (1,656,903)            3,976,369
                                                                        ----------            ----------
Net Increase (Decrease) in Cash and

        cash Equivalents                                                 1,216,632             1,918,407
Cash and Cash Equivalents at Beginning
        of Period                                                           97,319               250,212
                                                                        ----------            ----------
Cash and Cash Equivalents at End of Period                              $1,313,951            $2,186,619
                                                                        ==========            ==========
</TABLE>


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

                                        5
<PAGE>

                    GREKA ENERGY CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         The accompanying  unaudited condensed consolidated financial statements
have been prepared on a basis  consistent  with the  accounting  principles  and
policies  reflected in the financial  statements for the year ended December 31,
1999,  and  should  be read  in  conjunction  with  the  consolidated  financial
statements and notes thereto included in the Company's 1999 Form 10-K/A.  In the
opinion  of  management,   the  accompanying  unaudited  condensed  consolidated
financial  statements  contain  all  adjustments  (which,  except  as  otherwise
disclosed  herein,  consist of normal  recurring  accruals  only)  necessary  to
present  fairly the  Company's  consolidated  financial  position as of June 30,
2000,and  the  consolidated  results of  operations  for the six and three month
periods ended June 30, 2000 and 1999,  and the  consolidated  cash flows for the
six month periods ended June 30, 2000 and 1999.

Oil and Gas Properties

         The Company  periodically reviews the carrying value of its oil and gas
properties  in  accordance  with   requirements  of  the  full  cost  method  of
accounting.  Under these rules,  capitalized costs of oil and gas properties may
not exceed the  present  value of  estimated  future net  revenues  from  proved
reserves,  discounted  at 10%,  plus the lower of cost or fair  market  value of
unproved  properties  ("ceiling").  Application  of this ceiling test  generally
requires  pricing  future  revenue at the prices in effect as of the end of each
reporting period and requires a writedown for accounting purposes if the ceiling
is exceeded.

Business Segments

         The Company`s  operations  are in three industry  segments:  Integrated
Operations  (California refinery and E&P), E&P Americas,  and E&P International.
Information about the Company's operation by segment as of and for the three and
six month periods ended June 30, 2000 and 1999, is as follows (in thousands):

<TABLE>
<CAPTION>
Three Months                      Integrated          E&P             E&P       Corporate
Ended June 30, 2000               Operations       Americas      International  and other        Total
-------------------               ----------       --------      -------------  ---------      -------
<S>                              <C>                <C>             <C>         <C>           <C>
Total Oil and Gas Revenue        $   2,206          $3,428          $170        ($2,262)      $3,541
Refinery Revenue                    10,158               0             0              0       10,158
Total Revenue                       12,364           3,428           170        ( 2,262)      13,699
Production Costs                       668             979            27              0        1,674
Refinery Costs                       7,604               0             0        ( 2,262)       5,342
Gross Profit                         4,092           2,449           142              0        6,683
Other Expenses                         395             472            58            795        1,720
DD&A Expenses                          250             369            24              0          643
EBITDA                               3,697           1,977            84       (    795)       4,963
EBIT                                 3,447           1,608            60       (    795)       4,320
Interest and other
     (expenses) income                 537            (15)            13            250          785
Net income (loss)                   $2,910          $1,623           $47       ( $1,045)      $3,535
                                    ================================================================
</TABLE>


                                       6
<PAGE>


<TABLE>
<CAPTION>
Six Months                      Integrated            E&P            E&P        Corporate
Ended June 30, 2000             Operations         Americas     International   and other     Total
-------------------             ----------         --------     -------------   ---------    -------
<S>                               <C>             <C>            <C>           <C>          <C>
Total Oil and Gas Revenue         $  4,157        $  6,255       $   423       ($4,157)     $  6,678
Refinery Revenue                    16,702               0             0             0        16,702
Total Revenue                       20,859           6,255           423        (4,157)       23,380
Production Costs                     1,373           1,719            84             0         3,175
Refinery Costs                      13,421               0             0        (4,157)        9,264
Gross Profit                         6,066           4,535           339             0        10,940
Other Expenses                       1,116             870           104         1,034         3,125
DD&A Expenses                          729             783            77             0         1,590
EBITDA                               4,950           3,665           235        (1,034)        7,816
EBIT                                 4,221           2,882           157        (1,034)        6,226
Interest and other
     (expenses) income               1,214              69            27           502         1,812
Net income (loss)                 $  3,007        $  2,814          $129       ($1,536)       $4,414
                                  ==================================================================

Capital Expenditures             $     478       $     708      $  (419)       $   251      $  1,018
Identifiable Assets              $  58,241       $  15,331      $  7,622       $ 6,066      $ 87,260
</TABLE>



<TABLE>
<CAPTION>
Three Months                    Integrated            E&P            E&P        Corporate
Ended June 30, 1999             Operations         Americas     International   and other      Total
-------------------             ----------         --------     -------------   ---------    -------
<S>                               <C>               <C>         <C>              <C>        <C>
Total Revenue                     $  5,314          $1,510      $  1,872         $    0     $  8,696
Production Costs                     2,698             715         1,023              0        4,436
Gross Profit                         2,616             795           849              0        4,260
Other Expenses                         163             416           100            483        1,162
DD&A Expenses                          800             401           267             33        1,501
EBITDA                               2,452             379           749           (483)       3,097
EBIT                                 1,653             (22)          482           (516)       1,597
Interest and other
     (expenses) income                  72              62           (76)           284          342
Net income (loss)                 $  1,581          $  (84)     $    558         $ (800)    $  1,255
                                  ==================================================================
</TABLE>



<TABLE>
<CAPTION>

Six Months                      Integrated            E&P            E&P        Corporate
Ended June 30, 1999             Operations         Americas     International   and other      Total
-------------------             ----------         --------     -------------   ---------    -------
<S>                               <C>             <C>          <C>               <C>         <C>
Total Revenue                     $  5,470        $  1,564     $   2,015         $     0     $  9,049
Production Costs                     2,787             751         1,111               0        4,649
Gross Profit                         2,683             813           904               0        4,400
Other Expenses                         181             423           127             856        1,587
DD&A Expenses                          921             442           299              57        1,719
EBITDA                               2,502             390           777            (856)       2,813
EBIT                                 1,581             (52)          478             (93)       1,094
Interest and other
     (expenses) income                  72              62           (76)            914          972
Net income (loss)                 $  1,509        $   (114)    $     554         $(1,827)     $   122
                                  ===================================================================
</TABLE>


                                       7
<PAGE>


NOTE 2 - INVENTORY

Inventory is stated at the lower of cost,  determined  on a first-in,  first-out
basis or market and includes material,  labor and manufacturing  overhead costs.
Due to the continuous  manufacturing  process,  there is no significant  work in
process at any time. Inventory consists of the following at June 30, 2000:

Raw Material ........................$ 1,450,517
Finished goods.......................  3,694,915
                                     -----------
   Total ............................$ 5,145,432
                                     ===========

NOTE 3 - STATEMENT OF CASH FLOWS

Following is certain supplemental  information  regarding cash flows for the six
month periods ended June 30, 2000 and 1999:

                                              2000                     1999
                                          ------------               --------
          Interest paid                   $1,701,984                $784,614
          Income taxes paid               $        0                $      0



NOTE 4 - CONTINGENCIES

In 1993, GREKA's subsidiary  acquired a producing mineral interest in California
from a  major  oil  company.  At  the  time  of  acquisition,  the  subsidiary's
investigation  revealed that a discharge of diluent,  a light,  oil-based  fluid
which is often mixed with  heavier  grades of crude had occurred on the acquired
property.  The purchase  agreement  required the seller to remediate the area of
the diluent spill.  After the subsidiary  assumed operation of the property,  it
became  aware of  additional  diluent  contamination  and believes the major oil
company is  responsible  to remediate  these areas as well.  The  subsidiary has
notified  the  seller  of  its  obligation  to  remediate.  Notwithstanding  the
subsidiary's  compliance in proceeding with any required remediation on seller's
account,  the  subsidiary  is committed to hold the seller  accountable  for the
required  remediation.  Since the  investigation  is not  complete,  an accurate
estimate  of cost cannot be made.  In May 2000,  the Company and the seller were
named  as  parties  to a legal  proceeding  filed  by the  surface  owner of the
property  with  respect  to the  contamination.  (See  Part  II,  Item  1-"Legal
Proceedings")

In 1995,  GREKA's  subsidiary  agreed  to  acquire  an oil and gas  interest  in
California on which a number of out of production  oil wells had been drilled by
the seller.  The acquisition  agreement  required that the subsidiary assume the
obligation  to  abandon  any  wells  that  the  subsidiary  did  not  return  to
production,  irrespective of whether certain consents of third parties necessary
to transfer the property to the subsidiary  were  obtained.  A third party whose
consent was  required to transfer  the  property did not consent to the transfer
and is holding the seller accountable for all remediation.  Management  believes
the subsidiary has no obligation to remediate this property  because it believes
the  seller  did not give the  subsidiary  any  consideration  to enter into the
contract for the property.  Since May 2000, the subsidiary commenced remediation
on the subject  property as directed by the regulatory  agency.  Notwithstanding
the  subsidiary's  compliance in  proceeding  with any required  remediation  on
seller's account, the subsidiary is committed to hold the seller accountable for
the  required  obligations  of the  property.  Since  the  investigation  is not
complete, an accurate estimate of cost cannot be made.

                                       8
<PAGE>

GREKA's  subsidiary owns an asphalt  refinery in Santa Maria,  California,  with
which significant  environmental  remediation  obligations are associated.  This
refinery  was  acquired  from  Conoco  Inc.  in 1994  and  Conoco  performs  all
environmental obligations that arose during and as a result of its operations of
the refinery prior to the acquisition.

GREKA's subsidiaries,  as is customary in the industry, are required to plug and
abandon wells and remediate  facility sites on their properties after production
operations  are completed.  The cost of such  operation will be significant  and
will occur, from time to time, as properties are abandoned.

There  can  be no  assurance  that  material  costs  for  remediation  or  other
environmental  compliance will not be incurred in the future.  The occurrence of
such environmental  compliance costs could be materially adverse to the Company.
No  assurance  can be given that the costs of  closure  of any of the  Company's
subsidiaries'  other oil and gas  properties  would not have a material  adverse
effect on the Company.

NOTE 5 - SALE OF NON-PRODUCING ASSETS

         In June and July 2000, the Company's Canadian subsidiary sold a portion
of its non-producing oil and gas assets for an aggregate  contract price of $0.9
million.

NOTE 6 - FINANCING AND DEBT RESTRUCTURING

         In June 2000,  the  Company  closed  with  Canadian  Imperical  Bank of
Commerce the financing of up to $47.5 million with actual  availability  subject
to borrowing base adjustments. A portion of the proceeds were paid to reduce the
current debt of the Company,  which payment resulted in the complete elimination
of all Bank One debt ($2,986,497).

         In June 2000,  the  Company  exchanged  $3.3  million of Saba 9% senior
subordinated debentures for GREKA debentures.

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

         GREKA  Energy  Corporation,  a  Colorado  corporation  ("GREKA"  or the
"Company") is an independent  integrated  energy  company  committed to creating
shareholder  value by capitalizing on consistent cash flow hedged from oil price
fluctuations  within  integrated  operations,  exploiting E&P  opportunities and
penetrating new niche markets utilizing proprietary  technology with an emphasis
on low cost short radius horizontal drilling technology patented by BP Amoco and
licensed to GREKA. GREKA has oil and gas production, exploration and development
activities in North America and the Far East,  with primary areas of activity in
California,  Louisiana,  and China.  In  addition,  GREKA owns and  operates  an
asphalt refinery in California through a wholly-owned subsidiary.

Business Strategy

           GREKA's objective is to build  shareholder  value through  consistent
economic growth both in the increased  throughput at its asphalt refinery and in
the growth of its reserves and  production  thereby  creating an increase in net
asset value per share, cash flow per share and earnings per share. Management is
focused on a balanced program of low to medium risk exploitation and development
of its existing reserves utilizing its low cost horizontal short radius drilling
technology  licensed from BP Amoco. This is balanced by rapid growth through the
acquisition  of  synergistic  businesses  such  as the  Saba  Petroleum  Company
("Saba")  acquisition  concluded during the first quarter of 1999. All asset and
capital  investment  decisions  are measured  and ranked by their  risk-adjusted
impact on per share value.

         GREKA has  established a three prong  strategy that  capitalizes on its
asset base to enhance shareholder value as follows:

                                       9
<PAGE>

         Integrated Hedged Operations

         Hedged  operations of GREKA are planned to focus on the  integration of
its Santa Maria (California) assets,  including an asphalt refinery and interest
in heavy oil fields.  The hedged  operations  are targeted to  capitalize on the
stable  asphalt  market in California by providing a balance of equity and third
party feedstock  (heavy oil) into the refinery.  The integration of the refinery
(100% owned) with the interests in the heavy oil producing  fields (100% working
interest)  has  successfully  provided  a stable  hedge to GREKA on each  equity
barrel  (since  June  1999).  GREKA's  strategy  in these  integrated  assets is
two-fold:

1.   GREKA intends  to  proceed  with  acquisitions  that  enhance  the
     long-term feedstock supply to the refinery.

2.   GREKA intends to implement the  proprietary  BP Amoco  Horizontal  Drilling
     Technology  to  cost-efficiently   boost  production  rates  from  the  150
     potential drilling  locations  identified in the Santa Maria Valley area of
     central California.

The two actions are targeted to increase  throughput  into the refinery from the
highest  rate  during  1999 of  approximately  4,500  barrels  per day to 10,000
barrels per day by year end 2002. It is anticipated that the profitability  from
these integrated  operations will not be affected by volatile oil prices.  It is
also  anticipated  that,  by using the equity  barrels  to supply the  refinery,
working capital  requirements  should be lower and cash flow should be enhanced.
The continued stability of the price of asphalt,  coupled with reduced costs for
processing  and  lifting,   should  create  a  substantial   value  for  GREKA's
shareholders.

         Exploitation, Exploration & Production

         GREKA is focusing on return to  production  ("RTP")  work that had been
ignored by Saba.  Such RTP has  enhanced  and is expected to continue to enhance
the current production levels and capitalize on current oil prices (as announced
in GREKA's  press  release of August 1, 2000).  GREKA plans to capitalize on its
existing  portfolio of domestic and  international  exploitation and exploration
projects  that  are  synergistic  with  GREKA's  BP  Amoco  Horizontal  Drilling
Technology.  GREKA plans to  specifically  focus on its existing  concessions in
strategic locations, such as China, where GREKA believes there is a significant,
long-term demand for energy and a niche advantage for the Company.

         BP Amoco Horizontal Drilling Technology

         GREKA plans to continuously  pursue new, emerging  opportunities in the
energy  business to identify  and  evaluate  niche  markets for its  proprietary
knowledge.  Two  specific  niche  targets are coal bed methane  projects and gas
storage.  These opportunities  should provide significant upside from the use of
short horizontal laterals.

         Significant  and  lucrative  markets exist for the  application  of the
niche technology for GREKA's short radius horizontal  drilling know-how.  Mature
fields are in abundance  throughout the world where the operators are faced with
declining  production,  uncertain  oil prices and upcoming  costs to abandon and
plug the uneconomic wells at their production rates. Such an environment creates
a unique  market  for  GREKA to  acquire  such  fields  through  a  conservative
selection process. Primary acquisition candidates will have existing production,
existing  operating   infrastructure  and  facilities,   geological   formations
conducive to the  technology,  well bores and pay zones under ten thousand  feet
with sufficient  recoverable  oil in place. As an example,  GREKA has found that
California  is  a  unique   opportunity   due  to  its  stringent  new  drilling
regulations.  GREKA's activities are essentially  "re-work" negating any lengthy
approvals  through the regulatory  authorities.  Such an environment has created
"pockets" of opportunity  whereby  significant  recoverable oil has been left in
place by the majors and owners which,  rather than attempt a costly  endeavor to
drill new wells in urban  areas,  choose  to sell  their oil and gas  interests.
GREKA intends to pursue such opportunities.

                                       10
<PAGE>

Business Development of GREKA

         GREKA Energy  Corporation was formed in 1988 as a Colorado  corporation
under the name of Kiwi III,  Ltd. On May 13,  1996,  GREKA,  then known as Petro
Union, Inc., filed a voluntary petition for relief pursuant to Chapter 11 of the
United States  Bankruptcy Code.  Current GREKA management  acquired Petro Union,
Inc. and  simultaneously  procured on August 28, 1997, an order confirming Petro
Union's First Amended Plan of  Reorganization  from the Bankruptcy Court for the
Southern District of Indiana. The bankruptcy court approved the final accounting
and closed the bankruptcy proceedings on March 26, 1998.

         During  1998,  management  of GREKA  focused  substantially  all of its
efforts on corporate restructuring, recapitalization and acquisition efforts and
an investment in a horizontal  drilling pilot program in the Cat Canyon field in
California that all were part of  implementing  its strategic niche growth plan.
During the latter part of 1998 and early 1999,  management was primarily focused
on  the  acquisition  of  Saba,   which  had  substantial   reserves  suited  to
exploitation  by  GREKA's  horizontal  drilling  technology,   and  considerable
expenses  were incurred in connection  with the Saba  transactions  in the first
quarter  of 1999.  Due to the  significance  to  GREKA of the Saba  acquisition,
GREKA's  management and staff devoted a substantial amount of time and effort to
the acquisition.

         On March 22, 1999,  the  Company,  then known as  Horizontal  Ventures,
Inc.,  changed its name to GREKA Energy  Corporation.  Effective March 24, 1999,
GREKA acquired Saba as a wholly owned subsidiary.

         Immediately subsequent to the completion of the acquisition, management
commenced its strategy which resulted in the following material accomplishments:

o    In May 1999, the Company's subsidiary assumed full operation of its asphalt
     refinery  which  significantly  increased,  and is  expected to continue to
     increase, operating cash flows.

o    Also in May 1999, the Company's  subsidiaries  secured financing with a new
     bank, BNY Financial  Corporation  ("BNY"),  for $11 million which was later
     increased to $12 million in September 1999.

o    Further in May 1999, the Company's  subsidiary  paid $6 million to Bank One
     Texas,  N.A.  ("Bank  One") to reduce  the debt  owed by Saba  which was in
     default since 1998.

o    In June  1999,  the  Company's  subsidiary  sold  its  non-core  assets  in
     Colombia, further reducing its debt by $10 million while maintaining upside
     potential  through  either a  repurchase  option  which has  recently  been
     exercised or a court order directing rescission of the sale.

o    In July 1999,  the Company  completed the  acquisition of all of the Beaver
     Lake Resources  Corporation  (the owner of the Company's  Canadian  assets)
     shares it did not already own, thereby  privatizing Beaver Lake as a wholly
     owned subsidiary.  Greka issued approximately 68,000 shares to complete the
     acquisition of the minority interest.

o    In August 1999, the Company entered into a term sheet to restructure Saba's
     9% senior subordinated debentures.

o    Also in August  1999,  the  Company's  subsidiary  emerged  from  voluntary
     bankruptcy  following  consummation  of the sale of its non-core  assets in
     Colombia.

o    Further  in August  1999,  the  Company's  subsidiary  signed a  production
     sharing contract with the China United Coalbed Methane  Corporation Ltd. to
     jointly exploit coalbed methane (CBM) resources in China.

                                       11
<PAGE>

o    In November 1999, the Company's  subsidiaries closed the financing of a $35
     million  facility with GMAC Commercial  Credit LLC to provide  financing to
     reduce current liabilities and for future acquisitions.

o    Also in November 1999, the Company's  subsidiary made an additional payment
     of $11.2 million to Bank One to reduce the defaulted debt owed by Saba.

o    Further in November 1999, the Company adopted a shareholder  rights plan to
     preserve the long-term value of the Company for its shareholders.

o    In December 1999, the Company  announced that its shares commenced  trading
     on the Nasdaq National Market System.

o    In February  2000,  GREKA  announced  that it had the option to re-purchase
     Colombian  assets valued at  approximately  $65 million (PV-10) pursuant to
     the Company's calculations that a look-back provision,  under the agreement
     by which the assets were sold,  is three times  greater  than the  required
     valuation  threshold.  In March 2000, GREKA further announced that, subject
     to a court order  directing  rescission  of the sale,  it had exercised its
     option to re- purchase the  Colombian  assets for an estimated  cost of $12
     million which will result in the  Company's  receipt of assets with a PV-10
     value of  approximately  $65  million at December  31, 1999  (approximately
     $12.22 per share outstanding).  In August 2000, GREKA announced that it had
     secured the Colombian assets with a court-ordered  injunction,  prohibiting
     the transfer,  encumbrance  or  disposition  of the assets and related cash
     flow  until the  court  determines  the  rights  of the  parties  under the
     agreement. (See Part II, Item 1-"Legal Proceedings")

o    In June 2000,  the Company  closed with Canadian  Imperial Bank of Commerce
     ("CIBC")  the  financing of up to $47.5  million  with actual  availability
     subject to borrowing base adjustments.  A portion of the proceeds were paid
     to reduce the current debt of the Company,  which  payment  resulted in the
     complete elimination of all Bank One debt.

o    In June  2000,  the  Company  exchanged  $3.3  million  of  Saba 9%  senior
     subordinated debentures for GREKA debentures.

o    In June and July 2000, the Company's Canadian  subsidiary sold a portion of
     its non-producing assets for an aggregate contract price of $0.9 million.

o    In August 2000, the Company  announced that its daily production  increased
     over 22%, with an 18% increase in oil  production and a 34% increase in gas
     production  since  December  1999.  The  Company  further  highlighted  the
     concentration  of its E&P Americas  segment on  increasing  gas  production
     which had  risen  66% in June  compared  to  March,  through  a  continuous
     workover program.

                                       12
<PAGE>

Cautionary Information About Forward-Looking Statements

     This document  contains  forward-looking  statements  within the meaning of
Section  27A of the  Securities  Act and Section 21E of the  Exchange  Act.  All
statements,   other  than  statements  of  historical  facts,   included  in  or
incorporated by reference into this Form 10-Q which address  activities,  events
or developments  which the Company expects,  believes or anticipates will or may
occur in the  future  are  forward-looking  statements.  The  words  "believes,"
"intends," "expects,"  "anticipates,"  "projects,"  "estimates,"  "predicts" and
similar  expressions are also intended to identify  forward-looking  statements.
These forward-looking statements include, among others, statements concerning:

*    the benefits expected to result from GREKA's acquisition of Saba, including
*    synergies in the form of increased revenues,
*    decreased  expenses and avoided expenses and expenditures that are expected
     to be realized as a result of the Saba acquisition, and
*    the  complementary  nature of GREKA's  horizontal  drilling  technology and
     certain oil reserves acquired with the acquisition of Saba, and

other statements of:

*    expectations,
*    anticipations,
*    beliefs,
*    estimations,
*    projections, and

other similar matters that are not historical facts, including such matters
     as:

*    future capital,
*    development and exploration  expenditures (including the timing, amount and
     nature thereof),
*    drilling and reworking 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,
*    oil, gas and asphalt prices and demand,
*    exploitation and exploration prospects,
*    expansion and other development trends of the oil and gas industry, and
*    expansion and growth of business operations.

     These statements are based on certain  assumptions and analyses made by the
management of GREKA in light of its  experience and its perception of historical
trends,  current  conditions and expected  future  developments as well as other
factors it believes are appropriate in the circumstances.

     GREKA cautions the reader that these forward-looking statements are subject
to risks and uncertainties, including those associated with:

*    the financial environment,
*    general economic, market and business conditions,
*    the regulatory environment,
*    business opportunities that may be presented to and pursued by GREKA,
*    changes in laws or regulations
*    exploitation and exploration successes,
*    availability to obtain additional financing on favorable conditions,
*    trend projections, and
*    other factors, many of which are beyond GREKA's control,

that  could  cause  actual  events or results  to differ  materially  from those
expressed or implied by the  statements.  Such risks and  uncertainties  include
those risks and  uncertainties  identified in the  Management's  Discussion  and
Analysis  sections of this document and risk factors discussed from time to time
in the Company's filings with the Securities and Exchange Commission.

                                       13
<PAGE>

         Significant  factors that could prevent GREKA from achieving its stated
goals include:

*    the inability of GREKA to obtain financing for capital expenditures and
     acquisitions,
*    declines in the market prices for oil, gas and asphalt,  and
*    adverse changes in the regulatory environment affecting GREKA.

         The  cautionary  statements  contained or referred to in this  document
should  be  considered  in  connection  with  any  subsequent  written  or  oral
forward-looking  statements that may be issued by GREKA or persons acting on its
or their  behalf.  GREKA  undertakes  no  obligation  to  release  publicly  any
revisions to any  forward-looking  statements to reflect events or circumstances
after the date hereof or to reflect the occurrence of unanticipated events.

Long-Term Potential

         Management  believes that the results of operations for the three month
period  ended June 30, 2000 and cash flows of GREKA  reported  herein  should be
indicative of the expected  future second quarter results of operations and cash
flows of GREKA,  since the results of operations  of the Company's  refinery are
somewhat  seasonal due to seasonal  fluctuations in the asphalt market.  Asphalt
sales have been  generally  higher in the third  quarter  and lower in the first
quarter. Due to these seasonal  fluctuations,  results of operations for interim
quarterly  periods may not be  indicative of results which may be realized on an
annual  basis.  The  results of the Company as  reported  herein,  and which are
demonstrative of the successful  implementation  of management's  business plan,
continue to reflect the long-term potential of the Company. The Company's EBITDA
is 36% of its  revenue  for the three  months  ended  June 30,  2000,  and it is
expected  that, as the Company  increases  its  revenues,  its cash flows should
continue to increase.

Results of Operations

Comparison of Three Month Periods Ended June 30, 2000 and 1999

     Revenues  increased from  $8,695,456 for  the  second quarter  of  1999  to
$13,699,489  for the second  quarter of 2000  primarily as a result of increased
production and increased prices.

     Production  costs  increased from $4,435,414 for the second quarter of 1999
to  $7,016,569  for the  second  quarter  of 2000  primarily  as a result  of an
increase in the price of crude oil that was purchased by the refinery.

     General and  administrative  expenses  increased  from  $1,162,267  for the
second quarter of 1999 to $1,720,221 for the second quarter of 2000 primarily as
a result of increased staffing.

     Depreciation,  depletion and amortization decreased from $1,500,811 for the
second quarter of 1999 to $642,925 for the second quarter of 2000 also primarily
as a result of the Company having an increased reserve base.

     Interest expense  increased from $542,581 for the second quarter of 1999 to
$784,614 for the second quarter of 2000 primarily as a result of slightly higher
interest rates.

                                       14
<PAGE>

Comparison of Six Month Periods Ended June 30, 2000 and 1999

     Revenues   increased  from  $9,048,558  for  the  first  half  of  1999  to
$23,379,915  for the  first  half of 2000  primarily  as a result  of  increased
production and increased prices and as a result of the timing of the acquisition
of Saba which did not occur until the last week of the first quarter 1999.

     Production  costs  increased from  $4,648,400 for the first half of 1999 to
$12,439,483  for the first half of 2000  primarily as a result of an increase in
the price of crude oil that was purchased by the refinery and as a result of the
timing of the acquisition of Saba which did not occur until the last week of the
first quarter 1999.

     General and administrative expenses increased from $1,587,002 for the first
half of 1999 to $3,124,510  for the first half of 2000  primarily as a result of
increased staffing.

     Depreciation,  depletion and amortization decreased from $1,719,186 for the
first half of 1999 to $1,589,839  for the first half of 2000 also primarily as a
result of the Company having an increased reserve base.

     Interest  expense  increased  from  $646,271  for the first half of 1999 to
$1,811,984 for the first half of 2000  primarily as a result of slightly  higher
interest  rates and as a result of the timing of the  acquisition  of Saba which
did not occur until the last week of the first quarter 1999.

Liquidity and Capital Resources

         The working capital at June 30, 2000 was $58,658  compared to a working
capital  deficit of  $22,404,303  at June 30,  1999.  Current  assets  increased
$957,315 from $14,187,240 at June 30, 1999 to $15,144,555 at June 30, 2000 which
includes a decrease of $630,529 in cash and cash  equivalents from $2,168,619 at
June 30,  1999 to  $1,538,090  at June 30,  2000.  Approximately  $5,145,432  of
refinery raw material and finished  product  inventories  resulted from refinery
operations.  Current liabilities  decreased from $36,591,543 at June 30, 1999 to
$15,085,897 at June 30, 2000, a decrease of $21,505,767  principally as a result
of the  restructuring  of most of the Company's  installment  debt.  The current
portion of long term debt decreased $15,981,185 between the periods.

Cash Flows

     Cash used in  operations  improved  from an outflow of $818,409 for the six
months ended June 30, 1999 to an inflow of  $3,891,499  for the six months ended
June 30,  2000.  Net income  for the  period,  adjusted  for  non-cash  charges,
provided $6,003,999 of cash inflow.

     The Company's net cash flows from investing activities decreased from a net
outflow of  $1,239,553  for the six months  ended June 30, 1999 to an outflow of
$1,017,694 for the six months ended June 30, 2000.

     The Company's net cash provided by financing  activities of $3,976,369  for
the six months ended June 30, 1999  compared to a net use of cash of  $1,656,903
for the six months ended June 30, 2000.

                                       15
<PAGE>

Liquidity

     Under the  direction  of  GREKA's  management  and in  accordance  with its
business  strategy,  GREKA has  improved its  liquidity  and expects to have low
capital  requirements.  Specifically,  GREKA  expects  to  fund  future  capital
expenditures from its cash flow and lines of credit in place.

Capital Expenditures

         The Company's  growth is focused on  acquisitions  that are synergistic
with its  technology.  It is intended  that such  acquisitions  will be achieved
concurrent with the closing of adequate financing.  Operationally on the current
asset base, the Company  expects to fund its annual capital  expenditures by its
cash flow and lines of credit in place.

     Under the  direction  of  GREKA's  management  and in  accordance  with its
business  strategy,  GREKA has  improved its  liquidity  and expects to have low
capital requirements.  The Company is current on all its interest payments,  and
has  sufficient  cash  flow  for  all  of its  operating  and  foreseen  capital
requirements. Further, GREKA intends to achieve the following:

     *    Continue  to  execute  an  aggressive  rework  program  to  return  to
          production existing wells on all properties that have shut-in wells.

     *    Utilize  the  in-house   proprietary  and  cost  effective  horizontal
          drilling  technology  to enhance  production in the Santa Maria Valley
          area.

     *    Continue  to acquire  assets to  enhance  the  benefit  of  integrated
          operations that collectively  provide for low cost operating  expenses
          and high cash flow.

GREKA's  management also believes that the disposition of non-core assets brings
opportunities for cost savings, and other synergies,  resulting in improved cash
flow  potential  for the  long-term  growth of GREKA and of  shareholder  value.
Further,  these dispositions give GREKA a stronger  consolidated asset base upon
which it can rely in securing future financings,  both equity and debt. However,
there is no assurance that any specific level of cost savings or other synergies
will be achieved or that such cost savings or other  synergies  will be achieved
within  the time  periods  contemplated,  or that  GREKA  will be able to secure
future financings.

Financing and Debt Restructuring Activities

     Outstanding debt and the Company's plans for payment or restructuring:

     *    The Company closed with CIBC the financing of up to $47.5 million with
          actual availability  subject to borrowing base adjustments.  A portion
          of the  proceeds  were paid to reduce the current debt of the Company,
          which  payment  resulted in the complete  elimination  of all Bank One
          debt booked by the Company  resulting  from its  acquisition  of Saba.
          Additional  proceeds  of the  loan  are to be used  for  acquisitions,
          working capital and other general corporate purposes.

     *    The  Company  exchanged  $3.3  million of Saba 9% senior  subordinated
          debentures for GREKA debentures.

Inflation

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

Item 3.   Quantitative and Qualitative Disclosures About Market Risk.

           At June 30, 2000,  the  Company's  operations  were exposed to market
risks primarily as a result of changes in commodity  prices,  interest rates and
foreign currency  exchange rates. The Company does not use derivative  financial
instruments for speculative or trading purposes.

                                       16
<PAGE>

                    PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

         The following material  developments  occurred during the quarter ended
June 30, 2000 with respect to the legal proceedings reported in the GREKA Annual
Report on Form 10-K/A for the fiscal year ended December 31, 1999:

     As  reported in the GREKA 1999 Annual  Report on Form  10-K/A,  in February
2000, GREKA's subsidiary filed an action against Omimex Resources,  Inc. and its
subsidiaries  seeking  an  order  directing  rescission  of  an  asset  purchase
agreement  effective  January  1,  1999 or,  alternatively,  directing  specific
performance of the agreement by Omimex. The Company's  subsidiary alleges claims
for breach of  contract,  breach of  covenant  of good  faith and fair  dealing,
negligent  misrepresentation and fraudulent inducement and seeks damages. Omimex
alleges  counter-claims  of breach of contract and seeks  declaratory  judgment.
While the  subsidiary  plans to vigorously  pursue all claims against Omimex and
defend all  counter-allegations,  the litigation is in its preliminary discovery
stages. The parties were working toward closing on the Company's re-purchase  of
the Colombian assets, which closing was extended to July 2000. Omimex refused to
close on July 14th as proposed by the  Company.  After the court's  finding of a
likelihood  that the  Company  will  prevail  on the  merits of its  claims  for
Omimex's  breach of the  agreement  and breach of the  implied  covenant of good
faith and fair dealing,  the Company was granted a temporary  restraining  order
and then an injunction  securing and protecting GREKA's rights to the assets and
related cash flow through trial.

         Pond v. GREKA Energy  Corporation,  et al. (Case No. 1007775,  Superior
Court of the State of California,  County of Santa Barbara,  Santa Maria Branch,
May 2000).  Eddie and Jeanne Pond have brought an action against  GREKA,  Unocal
Corporation and others seeking damages of an unspecified  amount based on claims
arising from defendants' alleged  contamination of the surface property owned by
the Ponds.  While GREKA plans to  vigorously  defend all claims  asserted by the
Ponds and to  aggressively  pursue  all  counter  and third  party  claims,  the
litigation  is  in  its  preliminary  stages  of  discovery.   (see  "Note  4  -
CONTINGENCIES of NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS")

         From time to time, the Company and its  subsidiaries  are a named party
in legal  proceedings  arising in the  ordinary  course of  business.  While the
outcome of such proceedings cannot be predicted with certainty,  management does
not expect  these  matters to have a material  adverse  effect on the  Company's
financial condition or results of operations.

Item 2.  Changes in Securities and Use of Proceeds.

     None.

Item 3.  Defaults Upon Senior Securities.

     The information  required by this Item is incorporated  herein by reference
to the  discussion  in Part I Item 1 of the  Company's  Form 10-K/A for the year
ended December 31, 1999 under the subheading  "Financing and Debt  Restructuring
Activities" at page 8.

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

       None.

Item 5.  Other Information.

         None.

                                       17
<PAGE>

Item 6.  Exhibits and Reports on Form 8-K.

     (a) Exhibits. The following exhibits are furnished as part of this report:

     Exhibit No.    Description

         10.1     Credit And Guarantee Agreement dated as of June 19, 2000 among
                  Greka AM, Inc. as borrower,  the Company as  guarantor,  CIBC,
                  Inc.  as  lender,   Canadian  Imperial  Bank  of  Commerce  as
                  administrative agent, and CIBC World Markets Corp as arranger*

         11.1     Computation of Earnings per Common Share*

         27.1     Financial Data Schedule*

* Filed herewith

     (b) During the  quarter  for which this  report is filed,  GREKA  filed the
following Reports on Form 8-K:

Current Report on Form 8-K dated July 7, 2000 which  reported  events under Item
5, Other Events.

                                    SIGNATURE

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                            GREKA ENERGY CORPORATION

Date: August 14, 2000          By:/s/ Randeep S. Grewal
                               -------------------------------
                               Randeep S. Grewal, Chairman and
                             Chief Executive Officer



                                       18