FORM 10-QSB
                       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 March 31, 1998

                                      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: 0-9500


                        MOUNTAINS WEST EXPLORATION, INC.
      (Exact name of small business issuer as specified in its charter)

              New Mexico                              85-0280415             
    (State or other jurisdiction of                (I.R.S. Employer
     incorporation or organization)               Identification No.)

                         616 CENTRAL AVE. SE. SUITE 213
                ALBUQUERQUE, NEW MEXICO                  87102
        (Address of principal executive offices)      (Zip Code)

     Indicate  by check  mark  whether  the  issuer  (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 issuer
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

The number of shares  outstanding of the issuer's common stock,  par value $.001
per share, at May 14, 1998, was 38,019,270 shares.

                                    PART  I

ITEM 1. FINANCIAL STATEMENTS

                       MOUNTAINS WEST EXPLORATION, INC.
                           CONDENSED BALANCE SHEET
                                  UNAUDITED

                                March 31, 1997

ASSETS

  Current Assets
    Cash ....................................................       $     4,044
    Accounts receivable .....................................           177,500
    Due from officer ........................................               899
    Deposit .................................................             1,500
    Accrued interest receivable .............................            11,424
                                                                    -----------
  Total current assets ......................................           195,367
                                                                    -----------
  Furniture and equipment
    Office furniture and equipment, at cost .................            12,470
    Less accumulated depreciation ...........................           (10,822)
                                                                    -----------
  Net furniture and equipment ...............................             1,648
                                                                    -----------
  Oil and gas properties, using the successful
     efforts method (Note 3) ................................         4,178,838
     Less accumulated depreciation,
        depletion and amortization ..........................           (14,779)
                                                                    -----------
  Net oil and gas properties ................................         4,164,059
                                                                    -----------
  Other assets
     Term deposit account - restricted ......................            53,042
     Note receivable, officer ...............................           100,000
     Investment in partnership ..............................            15,000
     Mineral interest .......................................            50,683
                                                                    -----------
  Total other assets ........................................           218,725
                                                                    -----------

Total assets ................................................       $ 4,579,799
                                                                    ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

  Current Liabilities
     Accounts payable .......................................       $    16,002
     Accrued payroll and related taxes ......................            64,756
     Accrued liabilities ....................................            38,400
     Note Payable Officer ...................................            23,374
     Due to affiliates ......................................         4,081,791
     Note payable ...........................................            35,000
                                                                    -----------
  Total Current Liabilities .................................         4,259,323
                                                                    -----------
  Stockholder's Equity
     Common Stock, $.001 par value, authorized:
       50,000,00 shares, issued 38,103,770
       shares; outstanding 38,019,270 shares ................            38,020
     Capital in excess of par value .........................         1,617,757
     Accumulated  deficit ...................................        (1,335,301)
                                                                    -----------
  Total Stockholders Equity .................................           320,476
                                                                    -----------

Total Liabilities and Stockholders Equity ...................       $ 4,579,799
                                                                    ===========


                       MOUNTAINS WEST EXPLORATION, INC.
                      CONDENSED STATEMENTS OF OPERATIONS
                                   UNAUDITED

                                                  Three Months     Three Months
                                                     Ended            Ended 
                                                    March 31,        March 31,
                                                      1998             1997

Revenues
  Oil and gas sales ..........................    $      4,936     $     10,895
  Lease income ...............................            --             13,655
  Interest in sale of oil & gas property .....            --               --
                                                  ------------     ------------
Total revenue ................................           4,936           24,550
                                                  ------------     ------------
 Expenses
  Production costs ...........................           1,043            4,205
  Exploration costs ..........................            --               --
  Depreciation and depletion .................             330              366
  Consulting .................................             714              264
  General and administrative .................          32,798           26,536
                                                  ------------     ------------
Total expenses ...............................          34,885           31,371
                                                  ------------     ------------

Loss from operations .........................         (29,949)          (6,821)

Other income
  Interest income ............................           1,300            1,090
  Interest expense ...........................          (1,764)            (313)
  Other ......................................             (35)            (230)
                                                  ------------     ------------
Total other income (loss) ....................            (499)             547
                                                  ------------     ------------

Net earnings .................................    $    (30,448)    $     (6,274)
                                                  ============     ============

Earnings (loss) per common share: ............    $       0.00     $       0.00
                                                  ============     ============
Weighted Average Number of Shares
  Outstanding (Note 2) .......................      38,019,270       37,034,270
                                                  ============     ============


                       MOUNTAINS WEST EXPLORATION, INC.
                      CONDENSED STATEMENTS OF CASH FLOWS
                                   UNAUDITED
                                   
                                                     Three Months   Three Months
                                                        Ended          Ended 
                                                       March 31,      March 31,
                                                         1998           1997
 
Cash Flows from Operating Activities
   Cash received from customers ..................    $   4,936      $  49,295
   Cash paid to suppliers & employees ............      (14,114)       (52,441)
   Interest received .............................          300             90
   Interest paid .................................       (1,764)          (313)
                                                      ---------      ---------
      Net cash used by operating activities ......      (10,642)        (3,369)
                                                      ---------      ---------
Cash Flows from Financing Activities
   Net proceeds from officer advances ............       11,943           --
                                                      ---------      ---------
      Net cash provided by financing activities ..       11,943           --   
                                                      ---------      ---------

Net increase (decrease) in cash ..................        1,301         (3,369)

Cash at beginning of period ......................        2,743         38,876
                                                      ---------      ---------

Cash at end of period ............................    $   4,044      $  35,507
                                                      =========      =========

Reconciliation of Net income (loss) to
   Cash Provided by Operating Activities:

Net earnings (Loss) ..............................    $ (30,448)     $  (6,273)
   Adjustments
   Depreciation, depletion and amortization ......          330            366
   Increase in prepaid expenses and
      accounts receivable ........................       (2,424)        (1,000)
   Increase in advances, accounts payable
      and accrued liabilities ....................       21,900          3,538
                                                      ---------      ---------

Net Cash used by Operating Activities ............    $ (10,642)     $  (3,369)
                                                      =========      =========

Noncash Investing or Financing Activities:
   Note issued in exchange for investment
      in oil and gas property in Papua,
      New Guinea: ................................    $ 191,920      $ 116,623


                        MOUNTAINS WEST EXPLORATION, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                    UNAUDITED
 
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.

The balance sheet at March 31, 1998 and  statements of operations and statements
of cash  flows  for the three  months  ended  March 31,  1998 and 1997 have been
prepared  by the  company,  without  audit.  In the opinion of  management,  all
adjustments,  including normal recurring adjustments necessary to present fairly
the financial  position,  results of operations and cash flows,  have been made.
Certain  information  and footnote  disclosures  normally  included in financial
statements prepared in accordance with generally accepted accounting  principles
have been condensed or omitted. It is suggested that these financial  statements
be read in  conjunction  with the  Company's  audited  financial  statements  at
December 31, 1997.  The results of  operations  for the three months ended March
31, 1998 are not necessarily indicative of operating results for the full year.

2. NOTES TO FINANCIAL STATEMENTS.

Net  income or loss per common  share has been  computed  based on the  weighted
average number of shares outstanding during the period.  Stock options issued in
1991 have not been considered as their effect would be antidilutive.

3.  OIL AND GAS PROPERTIES

Capitalized  costs using the successful  efforts method related to the Company's
oil and gas activities as of March 31, 1997 are as follows:

                 Proved developed properties ..   $    14,779
                 Proved shut - in property ....     4,164,059
                 Accumulated depreciation,
                    depletion, amortization and
                    valuation allowances ......       (14,779)
                                                  -----------

                 Net capitalized costs ........   $ 4,164,059
                                                  ===========

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Plan of Operations

During the quarter ended March 31, 1998, oil and gas sales were $4,936  compared
to $10,895  for the same  period in the prior  year.  The  Company  had no other
operating  income  during the quarter.  The reduction in sales is due in part to
the natural  decline in  production  from the  Company's gas wells in the Denver
Basin which have almost reached their economic limit. A  redetermination  of the
interests in the coal bed methane unit in Las Animas County,  Colorado where the
company  has an  interest  in two gas wells  has  caused a  decline  in  monthly
revenues to the Company.  Although the monthly sales revenue has decreased,  the
production lives of these wells will be extended and should be beneficial to the
Company over the life of the wells (See "Colorado "below).

The long  awaited  production  from the SE Gobe oil  field in Papua  New  guinea
commenced  in April,  1998.  Although  all of the  Company's  revenue  from that
license will be devoted to repaying the Company's  debts to its partners for its
share of the costs of establishing  the production,  which at March 31, 1998 was
approximately  $4,082,000.,  the debt  reduction  caused by this revenue  stream
should  greatly  increase  the  stockholders'  equity  position of the  Company.
Management  anticipates  that the  production  from the license will increase as
will the  Company's  share of the revenue  from the  production  (See "Papua New
Guinea" below).

At the time production commenced from the property, the Company became obligated
to pay its share of all  capital  development  costs  incurred on any license in
which it  holds  an  interest.  The  Company  owns  interests  in the  following
properties:

Colorado

The Company owns over 2400 acres of minerals in Las Animas county, Colorado. The
two coal bed methane gas wells discussed above are located on 240 acres of these
minerals.  The Company's  1770 acre tract of the minerals were leased to a Texas
oil company  however the company  declined to drill the necessary  wells to hold
the lease. The Company is currently considering developing these minerals itself
as funds become available.

Papua New Guinea

a. The three oil wells in which the Company has an interest  have been  included
in Petroleum  Development  License  (PDL) 3. As stated  earlier  these oil wells
commenced  production  on the 17th of April,  1998.  The three  wells  initially
produced about 12,000 barrels per day.  Production is increasing daily and plans
are to have the SE Gobe oil field  producing  25,000 barrels per day by mid July
1998.  These  wells and  certain  other lands  included  within  PDL#3 have been
unitized  with Chevron Oil  Company's  existing  PDL #4 to the north.  These two
partial PDLs are being developed as the Southeast Gobe Oil Field.  The Company's
interest in the unitized  production,  after  exercise by the  government of its
right to acquire a 22 1/2%  interest in the fields,  is a net 0.8718% which will
result  in an  anticipated  initial  production  to the  Company's  interest  of
approximately  220 barrels of oil per day. The  Company's  expenses in this unit
were carried until the first production from PDL 3 was sold. The operator of the
field,  Chevron,  was able to put the Gobe Main  field and the SE Gobe  field on
production   approximately  two  months  ahead  of  schedule  and  approximately
$50,000,000 under budget. The costs of getting the oil from the unit to sale has
been  estimated  at more than  $175,000,000,  none of which was  payable  by the
Company until after the first sale of production. At that time, all of the money
realized  from the sale of the oil will be devoted to  repayment  of the carried
cost of the project.  Management estimates at the production rate of 200 barrels
per day at a  price  of $20 per  barrel  to the  Company's  interest  will  take
approximately  thirty six months to pay out after production begins.  Because of
the recent  depressed  would price for oil the payout may well be  substantially
longer than anticipated.
 
b. PPL 189 contains  approximately  480,000  acres  (24,245 net to the Company's
interest).  As a result of reallocation of interests,  the Company's interest in
this License is 5.051%.  This license has the Barikiwa shut-in gas field located
on it. The Barikiwa  field has gas reserves  estimated from a low of 163 billion
cubic feet to a high of 1590 billion cubic feet. Further evaluation will be made
to more  precisely  define the true  reserves of this  field.  Plans to build at
least one LNG plant in Papua,  New Guinea  have been  announced  and Chevron has
announced  plans to build a gas  pipeline  from Papua New Guinea  into  Northern
Australia.  Either an LNG plant or the proposed pipeline should greatly increase
the value of the gas  reserves at  Barikiwa.  The Company  will have to fund its
5.051% share of the work program of this license which calls for an  expenditure
of  approximately  $6,250,000  over a period of six  years,  with  approximately
$56,000 of that amount to be paid during the current year. The operator, Santos,
has  recently  completed a seismic  program  over the  Barikiwa  Gas field.  The
seismic records are now being processed and the Company is awaiting the results.
As production  has commenced on the SE Gobe field,  the Company will now have to
pay its full share in future development of the license.

c. PPL 190 contains  approximately  460,000  acres  (17,309 net to the Company's
interest) has many very prospective  surface structures located on it. A seismic
line was run over the Masaka structure during 1997 with positive results.  It is
anticipated that the Masaka structures will be drilled during 1998,  however,  a
landowner  dispute has slowed progress and a definite date for the  commencement
of drilling is not known at this time. A reallocation of interests has increased
the Company's interest in this license to 3.763%. As production has commenced on
the SE Gobe  field,  the company  must fund its share of a new  seismic  program
which is estimated to cost  approximately  $1,000,000.  The manager of the joint
venture will issue cash calls to each partner, who will each then pay the amount
of the stated cash call. The Iehi shut in gas field lies on this license but the
reserves are  insignificant  at this time. The Company will have to fund most of
the work program of the license which calls for an  expenditure  of  $13,500,000
over the next five years.  Management  estimates that the Company's cost in this
new concession over the next year will be approximately $200,000.

d. PPL 203  (previously  PPL 165) - Oil Search Ltd, is the operator  with an 85%
ownership interest in the license.  Gedd, Inc. owns 10% while the Company owns a
5%  carried  interest  until a well is  commenced  on the  property.  A new work
program of seismic and surface mapping is to commence during the current year. A
part of the reorganization of the license, the Company received from Oil Search,
Ltd.(the  operator),  a payment of $177,500 in early April, 1998 as a refund for
previous  work done on the  license.  Under the terms of the  contract  with the
Operator,  the Company has a carried  interest in the two year work  program and
will not have to pay any of the costs  until  commencement  of the first well of
production at which time the Company will pay its 5% share.

As stated,  the Company faces cash calls on each of the licenses in which it has
interests, while the bulk of its revenue will be devoted to paying debt incurred
over the past two decades while  production was being  established on PDL#3. The
Company  must find the funds to meet the cash calls  through  the sale of stock,
borrowings  or sale of interests in its  properties.  No specific  source of the
required funds is known at the time of this report.

The Company does not presently  have the liquidity that may be necessary to meet
any call for payment of expenses and the Company has no present assurance of the
availability  of any of the funds  that may be needed  at the time  needed.  The
failure  of the  Company  to meet any cash  call made on it for its share of the
expenses  incurred on any concession  could result it its losing its interest in
the concession.

Changes in Financial Condition

During  the  quarter  the  Company  continued  to  experience  a decline in cash
position due to the ongoing operating expenses of the Company. On April 1, 1998,
the Company received $177,500 from Oil Search Pty, Ltd. (See PPL 203 above). The
Company's  total debt  increased  by $225,763  during the quarter as a result of
additional  expenses of exploration  being paid by the Company's  partners.  The
Company's  primary  liability is a continually  developing  carried  interest in
certain New Guinea oil and gas rights.  The Company's  total  liabilities  other
than those created by this carried interest are  approximately  $177,532.  It is
Management's  belief  that  the  Company  will be able to  continue  to meet its
financial commitments during the remainder of the fiscal year.


PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

Other than the judgment  described in the Company's annual report on form 10KSB,
incorporated  herein by reference,  management knows of no legal  proceedings or
unsatisfied judgments which have not been provided for in any court or agency to
which the Company or any of its officers or directors are or may be a party.
        
ITEM  2. CHANGES IN SECURITIES

       NONE

ITEM  3. DEFAULTS IN SENIOR SECURITIES

       NONE

ITEM  4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDER

       NONE

ITEM  5.  OTHER INFORMATION

       NONE

ITEM  6. EXHIBITS AND REPORTS ON FORM 8-K

       (a) There are no exhibits required by Item 601 of regulation S-K.

       (b) Reports on Form 8-K.  

           On February 6, 1998, the Company filed a form 8-K announcing the
           resignation of Mr. Thad H. Turk from the Board of Directors of
           Mountains West Exploration, Inc..


SIGNATURES

In accordance  with section 13 to 15(d) of the Exchange Act, the  registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.


Robert A. Doak, Jr.                                            May 13, 1998
--------------------------------------------------------
Robert A. Doak, Jr.   President, Chief Executive Officer
                      and Chief Financial Officer