-------------------------------------------------------------------------------


                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549



                                 FORM 10-QSB

              QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

               FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1999

                          COMMISSION FILE NO. 0-09482

                       COLORADO WYOMING RESERVE COMPANY
       (Exact Name of Small Business Issuer as Specified in its Charter)


             WYOMING                                 83-0246080
 (State or other jurisdiction of          (I.R.S. Employer Identification No.)
  incorporation or organization)


   751 HORIZON COURT, SUITE 205
     GRAND JUNCTION, COLORADO                          81506
(Address of principal executive offices)             (Zip Code)


          (970) 255-9995
   (Issuer's telephone number)

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 / /

There were 10,607,694 shares of the Registrant's $.01 par value common stock
outstanding as of February 7, 2000.

Transitional Small Business Disclosure:                Yes  /  /       No /X/


<PAGE>

                        COLORADO WYOMING RESERVE COMPANY
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                        December 31,        June 30,
                                                            1999              1999
                                                        ------------      -----------
<S>                                                     <C>               <C>
CURRENT ASSETS:
  Cash and cash equivalents                             $    100,820      $   241,455
  Trade accounts receivable                                       --            1,388
  Related party receivable                                     1,904              756
                                                        ------------      -----------
                                                             102,724          243,599

  Prepaid expenses                                             1,500            3,224
                                                        ------------      -----------
Total current assets                                         104,224          246,823

PROPERTY AND EQUIPMENT:
  Unproved oil and gas properties                            574,808          567,559
  Other property and equipment                                14,915           13,645
                                                        ------------      -----------
                                                             589,723          581,204
  Less accumulated depreciation, other
    property and equipment                                   (13,026)         (10,659)
                                                        ------------      -----------
    Net property and equipment                               576,697          570,545
                                                        ------------      -----------
Total assets                                            $    680,921      $   817,368
                                                        ============      ===========

CURRENT LIABILITIES:
  Trade accounts payable                                $     20,906      $     9,134
  Other accrued liabilities                                   14,206           33,324
  Related party payables                                      27,838            9,988
                                                        ------------      -----------
Total current liabilities                                     62,950           52,446

EQUITY
  Common Stock, $.01 par value: authorized--
    75,000,000 shares; issued and outstanding--
    10,607,694 and 10,552,694 shares at
    December 31 and June 30, 1999, respectively              106,077          105,527
  Additional paid-in capital                               5,262,976        5,254,276
  Warrants                                                   148,100          148,100
  Subscription receivable                                         --          (78,500)
  Accumulated deficit                                     (4,899,182)      (4,664,481)
                                                        ------------      -----------
                                                             617,971          764,922
                                                        ------------      -----------
Total liabilities and equity                            $    680,921      $   817,368
                                                        ============      ===========
</TABLE>


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


                                      -2-

<PAGE>

                        COLORADO WYOMING RESERVE COMPANY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)



<TABLE>
<CAPTION>
                                                     THREE MONTHS ENDED                SIX MONTHS ENDED
                                                         DECEMBER 31,                     DECEMBER 31,
                                               -----------------------------    --------------------------------------
                                                    1999            1998              1999            1998
                                               -----------------------------    --------------------------------------
<S>                                            <C>               <C>            <C>               <C>
Revenues
  Oil and gas sales                            $         --      $     4,063    $          --     $     9,340

Expenses
  Operation of producing properties                      --            4,786               --           17,302
  Production taxes                                       --              202               --              533
  Exploration cost                                   23,177           12,295           39,415           22,121
  Depreciation, depletion and amortization            1,254            1,069            2,367            2,138
  General and administrative                         92,926          298,276          197,080          490,377
                                               ------------      -----------    -------------     ------------
Total expenses                                      117,357          316,628          238,862          532,471
                                               ------------      -----------    -------------     ------------

Operating loss                                     (117,357)        (312,565)        (238,862)        (523,131)

OTHER INCOME (EXPENSE)
  Interest expense                                       --          (81,820)              --         (115,412)
  Interest income                                     1,857               --            4,161               --
  Loss on sale of assets                                 --          (11,829)              --          (11,829)
                                               ------------      -----------    -------------     ------------
Loss before income taxes                           (115,500)        (406,214)        (234,701)        (650,372)

Provision for income taxes                               --               --               --               --
                                               ------------      -----------    -------------     ------------
  Net loss                                     $   (115,500)     $  (406,214)   $    (234,701)     $  (650,372)
                                               ============      ===========    =============     ============

  Basic and diluted loss per share             $      (0.01)     $     (0.16)   $       (0.02)     $     (0.26)
                                               ============      ===========    =============     ============

  Weighted average common shares outstanding     10,607,694        2,491,694       10,598,377        2,489,838
                                               ============      ===========    =============     ============
</TABLE>


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


                                      -3-

<PAGE>



                        COLORADO WYOMING RESERVE COMPANY
                        CONSOLIDATED CASH FLOW STATEMENTS

<TABLE>
<CAPTION>
                                                                Six Months Ended
                                                                   December 31,
                                                          -----------------------------
                                                               1999             1998
                                                          -----------------------------
<S>                                                        <C>              <C>
Cash flows from operating activities:
Net loss                                                   $ (234,701)      $ (650,372)
  Adjustments to reconcile net loss to net used in
  operating activities:
  Depletion, depreciation and amortization                      2,367            2,138
  Loss on asset sale                                               --           11,829
  Amortization of note payable discount                            --          113,000
  Equity issued as compensation                                    --          231,000
  Other non-cash compensation                                      --           50,000

  Changes in current assets and liabilities:
    Receivables                                                   240              467
    Payables                                                   10,504           53,123
    Prepaids                                                    1,725            2,462
Net cash (used in) operating activities                      (219,865)         186,353)

Cash flows from investing activities:
  Additions to unproved properties                             (7,250)         (28,472)
  Asset purchases                                              (1,270)              --
  Proceeds from asset sales                                        --           63,916
Net cash (used in) provided by investing activities            (8,520)          35,444

Cash flows from financing activities:
  Notes payable                                                    --           57,692
  Sale of warrants                                                 --           72,408
  Sale of common stock                                         87,750           24,000
Net cash provided by financing activities                      87,750          154,100

Net (decrease) increase in cash and equivalents              (140,635)           3,191
Cash and equivalents at beginning of period                   241,455               --

Cash and equivalents at end of period                     $   100,820       $    3,191
</TABLE>


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


                                      -4-
<PAGE>

                       COLORADO WYOMING RESERVE COMPANY
                           ("CWYR" or the "Company")

                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)

          PERIODS ENDED DECEMBER 31, 1999 AND 1998 AND JUNE 30, 1999

1.    INTERIM FINANCIAL STATEMENTS

      The accompanying consolidated financial statements are unaudited. However,
      in the opinion of management, the accompanying financial statements
      reflect all adjustments necessary for a fair presentation.

      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 the
      Securities and Exchange Commission's rules and regulations. Management
      believes the disclosures made are adequate to make the information not
      misleading and suggests that these financial statements be read in
      conjunction with the Company's June 30, 1999 Form 10-KSB.

2.    FINANCINGS

      The Company closed a private equity offering on May 28, 1999, selling
      7.845 million restricted shares of Common Stock at $.10 per share pursuant
      to an exemption from registration under Rule 505 of Regulation D of the
      Securities Act of 1933, as amended. At June 30, 1999, 785,000 private
      offering shares were subscribed but not paid for; payment for those shares
      occurred during the quarter ended September 30, 1999.

      During July 1999, the Company granted to its president an incentive stock
      option pursuant to the Equity Incentive Plan, to purchase 500,000 shares
      of Common Stock at an exercise price of $.75 per share (determined to be
      at least 110% of the fair market value at the date of grant). The option
      has a five year life and is exercisable as of the date of grant.

3.    COMMITMENTS AND CONTINGENCIES

      Effective January 1, 1998, the Company entered into an Agreement for
      Administrative Services (the "Trinity Agreement") with Trinity Petroleum
      Management LLC, a Colorado limited liability company ("Trinity"). Pursuant
      to the terms of the Trinity Agreement, Trinity performs certain management
      functions for the Company. Trinity bills for its services on an hourly
      basis, receives a flat fee of $1,000 per month (formerly $3,000 per month)
      and is reimbursed for third party expenses. The Trinity Agreement is for a
      term of one year, continuing thereafter on a month-to-month basis,
      terminable upon 60 days written notice by either party. J. Samuel Butler,
      a member of the Board of Directors of the Company, currently serves as
      President of Trinity and owns approximately 24 percent of Trinity through


                                     -5-

<PAGE>

      his ownership of Butler Resources, LLC. In connection with certain
      additional services provided to the Company by Trinity pursuant to the
      Company's merger with Shoreline Resource Company, on January 22, 1998 the
      Company issued to Trinity 25,000 restricted shares of Common Stock as well
      as an option to purchase up to 100,000 shares of the Company's Common
      Stock at an exercise price of $1.50 per share, subsequently repriced to
      $.10 per share in May 1999.

      The Company entered into an employment contract with Mr. Fuerst on October
      1, 1996 pursuant to which Mr. Fuerst received a salary of $10,000 per
      month and was granted incentive stock options to purchase up to 500,000
      shares of the Company's Common Stock at an exercise price of $1.00 per
      share (repriced to $.25 per share in May 1999). The contract is for an
      initial term of three years commencing October 1, 1996 and is renewed
      automatically for succeeding periods of one year unless terminated. The
      Contract may be terminated by Mr. Fuerst upon 90-days prior written notice
      to the Company and by the Company without prior notice to Mr. Fuerst for
      cause (as defined in the contract). The Company's salary obligation to Mr.
      Fuerst of $10,000 per month for the months of June through October 1998
      was extinguished in connection with the purchase by FM Energy, LLC (of
      which Mr. Fuerst owns 50 percent and serves as co-manager) of the
      Company's properties located in North Dakota. The satisfaction of the
      Company's salary obligation for such months served as partial
      consideration for the purchase. Mr. Fuerst determined to forego his salary
      during the months of November and December 1998, and January through April
      1999. In May 1999, Mr. Fuerst's salary was reduced to $5,000 per month
      pursuant to an amendment to his employment agreement. See also Note 2 for
      a description of a stock option to purchase 500,000 shares of Common Stock
      granted to Mr. Fuerst in July 1999.

4.    LOSS PER SHARE

      Basic and diluted earnings per share are the same, as the effect of
      warrants and options is antidilutive.

5.    RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS:

      The Financial Accounting Standards Board ("FASB") issued Statement of
      Financial Accounting Standard ("SFAS") 133 ACCOUNTING FOR DERIVATIVE
      INSTRUMENTS AND HEDGING ACTIVITIES in June 1998. SFAS 133 established new
      accounting and reporting standards for derivative instruments and for
      hedging activities. This statement requires an entity to establish at the
      inception of a hedge, the method it will use for assessing the
      effectiveness of the hedging derivative and the measurement approach for
      determining the ineffective aspect of the hedge. Those methods must be
      consistent with the entity's approach to managing risk. In June 1999 the
      FASB issued SFAS 137, ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING
      ACTIVITIES - DEFERRAL OF THE EFFECTIVE DATE OF FASB STATEMENT 133. SFAS
      137 states that SFAS 133 shall be effective for all fiscal quarters
      beginning after June 15, 2000.

      The Company believes that these statements will have no material effect on
      the Company's financial statements


                                     -6-

<PAGE>

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS

UNCERTAINTY OF FORWARD-LOOKING INFORMATION

This quarterly report on Form 10-QSB includes statements that are not purely
historical and are "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. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ from projected results.
Such statements address activities, events or developments that the Company
expects, believes, projects, intends or anticipates will or may occur, including
such matters as future access to capital, locating and aligning with an industry
partner, the Company's ability to maintain an interest in its properties and
cash flow and anticipated liquidity. Factors that could cause actual results to
differ materially ("Cautionary Disclosures") include, among others: general
economic conditions, the market price of oil and natural gas, concentration of
the Company's properties in a small area in the Paradox Basin, the strength and
financial resources of the Company's competitors, climatic conditions,
environmental risks, the results of financing efforts and regulatory
developments. Many of such factors are beyond the Company's ability to control
or predict. All forward-looking statements included or incorporated by reference
in this Form 10-QSB are based on information available to the Company on the
date hereof. Although the Company believes that the assumptions and expectations
reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to have been correct or that the
Company will take any actions that may presently be planned. All forward-looking
statements attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by the Cautionary Disclosures.

LIQUIDITY AND CAPITAL RESOURCES

During fiscal 1998 the Company revised its strategy of seeking to purchase
producing oil and gas properties and, instead, implemented a strategy centered
on exploration. To help implement its new strategy, the Company entered into an
exploration joint venture and a merger agreement. In conjunction with its merger
with Shoreline Resource Company, Inc., the Company obtained its Paradox Basin
acreage.

Pursuant to the joint venture mentioned above, the Company purchased a once
producing field in North Dakota from a financially distressed entity. The
purchase included seven producing wells, a saltwater disposal well and a total
of 1,300 acres. Subsequently, an additional 1,700 developmental acres were
acquired. However, in order to raise cash to meet its short term obligations,
the Company sold the property during the quarter ended December 31, 1998.

During the quarter ended June 30, 1999, the Company raised approximately
$785,000 ($767,000 net of offering costs) in a private equity sale. The proceeds
allowed the Company to settle all outstanding payables, and provided funds for
recurring administrative costs and the cost of marketing its Paradox Basin
Project. The proceeds also allowed the Company to meet delay lease rental
obligations (necessary for the Company to maintain ownership of the leases
underlying its Paradox Basin Project)


                                     -7-

<PAGE>

during the six months ended December 31, 1999. The Company had a cash balance of
approximately $101,000 as of December 31, 1999 and $18,000 as of February 10,
2000.

The Company currently has no revenues and continues to incur certain general and
administrative expenses. During the 12 months ending December 31, 2000, the
Company will have lease rental obligations totaling approximately $67,000. While
the Paradox Basin Project is a marketable asset as it is currently configured,
the Company believes its marketability would increase should the Company be able
to add additional acreage. Towards that end, the Company purchased options
giving it the right to purchase approximately 14,000 additional acres. Those
options, which expire in February and March 2000, give the Company the right to
extend the option for an additional year at an approximate cost of $69,000 or to
exercise a five-year term lease at a cost of approximately $518,000. The
Company's existing financial resources, however, are insufficient to allow it to
extend or exercise its purchase options.

The Company is currently seeking a joint venture partner having financial
resources significant enough to enable the Company to exploit fully its Paradox
Basin Project. Such exploitation includes the shooting and interpretation of
seismic as well as the acquisition of additional acreage in the project area.
The terms of any joint venture the Company enters are negotiable, but the
Company intends to maintain an interest in the property.

Recent increases in oil and gas prices have resulted in increased investor
interest in the oil and gas industry. The Company could attempt to capitalize
on this interest by raising additional equity funds. Given the Company's cash
flow situation, debt financing is an unlikely alternative.

In summary, the Company has no cash flow from operations and will require
additional funding, through either a joint venture or from selling additional
equity capital, to convert its only significant asset into a cash generating
investment. Failure to secure a joint venture partner or raise additional
capital could result in the Company being liquidated on terms unfavorable to its
shareholders.

OPERATIONS. Cash used in operating activities was $219,865 for the six months
ended December 31, 1999 versus $186,353 for the comparable 1998 period, an
increase of approximately 18 percent. The increase results primarily from
changes in the accounts payable balances in each of the respective periods.

INVESTING. The Company made additions to its Paradox Basin property during both
the six months ended 1999 ($7,250) and the six months ended 1998 ($28,472). The
1998 proceeds from asset sales of $63,916 represents funds received for the sale
of the Company's producing properties.

FINANCING. At June 30, 1999 the Company had a subscriptions receivable balance
of $78,500. This balance was converted to cash during the six months ended
December 31, 1999. Additionally, the Company realized $9,250 from the proceeds
of stock option exercises during the same period. During the six months ended
December 31, 1998, the Company sold 24,000 shares of stock at $1 per share and
entered into a short term financing agreement providing for the borrowing of
$130,000. The $130,000 was repaid during the quarter ended June 30, 1999.


                                     -8-

<PAGE>

RESULTS OF OPERATIONS

OIL AND GAS OPERATIONS. The Company's producing properties began losing money
during fiscal 1998. For this reason, and due to the Company's lack of liquidity,
all of the Company's producing properties were sold during fiscal 1999 and 1998.

EXPLORATION COSTS. Exploration costs during the three and six month periods
ended December 31, 1999 were higher than during the year earlier comparable
periods due to higher delay lease rentals paid to maintain CWYR's ownership
position in certain Paradox Basin leases. Additionally, during the quarter ended
December 31, 1999 the Company purchased a seismic option for $10,883.

GENERAL AND ADMINISTRATIVE EXPENSE. General and administrative expense of
$490,377 for the six months ended December 31, 1998 included a noncash
compensation expense charge of $231,000; there was no such charge incurred
during the six months ended December 31, 1999 (total general and administrative
expense of $197,080). The 1998 figure, exclusive of the noncash charge, was
$259,377. The 24 percent decrease in general and administrative expense
exclusive of noncash items from 1998 to 1999 results primarily from lower 1999
salary expense and legal fees, net of increases in consulting fees related to
the marketing of the Company's Paradox Basin project.

During the quarter ended December 31, 1999 general and administrative expense
exclusive of noncash items decreased 37 percent from the year earlier quarter.
The reasons for the quarterly decrease were the same as those for the six month
decrease.

OTHER. Interest income of $4,161 earned during the six months ended December 31,
1999 ($1,857 for the quarter) was generated from the investment of the Company's
common stock sale proceeds. Interest expense of $115,412 (including amortization
of a note payable discount of $113,000) incurred during the six months ended
December 31, 1998 related to the short term financing entered into by the
Company during 1998. Interest expense of $81,820 for the quarter ended December
31, 1998 included amortization of note payable discount of $80,000.

EFFECTS OF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board ("FASB") issued Statement of Financial
Accounting Standard ("SFAS") 133 ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND
HEDGING ACTIVITIES in June 1998. SFAS 133 established new accounting and
reporting standards for derivative instruments and for hedging activities. This
statement requires an entity to establish at the inception of a hedge, the
method it will use for assessing the effectiveness of the hedging derivative and
the measurement approach for determining the ineffective aspect of the hedge.
Those methods must be consistent with the entity's approach to managing risk. In
June 1999 the FASB issued SFAS 137, ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND
HEDGING ACTIVITIES - DEFERRAL OF THE EFFECTIVE DATE OF FASB STATEMENT 133. SFAS
137 states that SFAS 133 shall be effective for all fiscal quarters beginning
after June 15, 2000.

The Company believes that these statements will have no material effect on the
Company's financial statements.


                                     -9-

<PAGE>

                                    PART II

Item 1.     Legal Proceedings.

            None.

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.

            None.

Item 5.     Other Information.

            None.

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

            (a)   Exhibits

                  Exhibit 27.  Financial Date Schedule

            (b)   Reports on Form 8-K.

                  None.


                                      -10-

<PAGE>

                                  SIGNATURES

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

                                    COLORADO WYOMING RESERVE COMPANY



Dated:  February 15, 2000           By: /s/Kim M. Fuerst
                                       ----------------------------------------
                                        Kim M. Fuerst
                                        President, Chief Executive Officer and
                                        Treasurer
                                        (Principal Executive and Financial
                                         Officer)