SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)

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

                  For the quarterly period ended June 30, 1998

                                       OR

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

              For the transition period from__________to__________.

                       Commission File Number 33-18834-LA

                             OPAL TECHNOLOGIES, INC.
         ---------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

           Nevada                                        87-0306464
--------------------------------             -----------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

         Suite 4704, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong
         --------------------------------------------------------------
                    (Address of principal executive offices)

                                  852-2541-1999
                            -------------------------
                           (Issuer's telephone number)

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

     Check whether the issuer (1) has filed all reports  required to be filed by
Section 13 or 15(d) of the Securities  Exchange Act of 1934 during the preceding
twelve (12) months (or such shorter  period that the  Registrant was required to
file such reports) and (2) has been subject to such filing  requirements for the
past ninety (90) days. Yes  X   No
                          -----   -----

     As of August 15, 1998, 35,991,954 shares of Common Stock of the issuer were
outstanding.


<PAGE>

                             OPAL TECHNOLOGIES, INC.
                                   FORM 10-QSB

                                      INDEX
                                                                        Page
                                                                       -------
PART I - FINANCIAL INFORMATION

ITEM 1 .  Financial Statements

             Consolidated Balance Sheets as of June 30, 1998 and
             December 31, 1997.........................................   3

             Consolidated Statements of Operations-for the three 
               months and six months ended June 30, 1998 and 1997......   4

             Consolidated Statements of Cash Flows-for the three 
               months and six months ended June 30, 1998 and 1997......   5

             Notes to Consolidated Financial Statements................   6

ITEM 2.  Management's Discussion and Analysis or Plan of Operations....   7

PART II - OTHER INFORMATION............................................   9




                                       2
<PAGE>

                         PART I - FINANCIAL INFORMATION

     ITEM 1. FINANCIAL STATEMENTS

                    OPAL TECHNOLOGIES, INC. AND SUBSIDIARIES
                      UNAUDITED CONSOLIDATED BALANCE SHEET

<TABLE>
                                                                                  6/30/98                    12/31/97
                                                                             -------------------      ---------------------
                                                                                  US$'000                     US$'000
                                                                             -------------------      ---------------------
<S>                                                                             <C>                      <C>

ASSETS
Current assets                                                                           134                      1,453
      Cash and bank deposits                                                           3,081                      2,590
      Accounts receivable, net                                                            18                        412
      Due from a shareholder                                                               -                          2
      Due from a director                                                                  -
      Due from a related company                                                          66                         26
      Prepayments and other current assets                                               791                        642
      Inventories, net
                                                                             ---------------           -----------------
            Total current assets                                                       4,090                      5,125
Property, machinery and equipment, net                                                 9,515                      2,123
Construction-in-progress                                                               5,783                        625
Licensing costs, net                                                                     881                        201
Goodwill, net                                                                            181                         38
                                                                             ---------------           -----------------
            Total assets                                                              20,450                      2,103
                                                                             ===============           =================
LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS' EQUITY
                                                                             ===============           =================
Current liabilities:
      Short-term borrowings                                                            1,976                      1,239
      Accounts payable                                                                   500                        625
      Accrued liabilities                                                                 72                        201
      Taxation payable                                                                    38                         38
                                                                             ---------------           -----------------
            Total current liabilities                                                  2,586                      2,103
Non-current payable                                                                    2,700                      2,877
Loans from PRC joint venture partner                                                     640                        639
Loans from a shareholder                                                                 282
                                                                             ---------------           -----------------
            Total liabilities                                                          6,208                      5,619
                                                                             ---------------           -----------------
Minority interests                                                                     2,634                      2,649
Shareholders' equity:
      Common stock, par value US$0.001:
      -     authorized - 49,000,000 shares as of December 31, 1997 and
            June 30, 1998                                                                 36                         36
      -     outstanding and fully paid - 35,991,964 shares as of December
            31, 1997 and June 30, 1998
      Preferred stock, par value US$0.001:
      -     authorized - 1,000,000 shares as of December 31, 1997 and
            June 30, 1998                                                                  -
      -     outstanding and fully paid - 100,000 shares of December 31,
            1997 and June 30, 1998
      Additional paid in capital                                                      12,213                     12,213
      Accumulated losses                                                               (628)                      (506)
      Cumulative translation adjustments                                                (13)                       (44)
                                                                             ---------------           -----------------
            Total shareholders' equity                                                11,608                     11,699
                                                                             ---------------           -----------------
            Total liabilities, minority interest and shareholders' equity             20,450                     19,967
                                                                             ===============           =================
</TABLE>


                                       3
<PAGE>

                    OPAL TECHNOLOGIES, INC. AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>

                                                            For the three months ended                 For the six months ended
                                                                     June 30                                    June 30
                                                       ------------------------------------      -----------------------------------
                                                            1998                 1997                 1998                 1997
                                                       --------------      ----------------      --------------      ---------------
                                                          US$'000              US$'000              US$'000               US$'000
                                                       --------------      ----------------      --------------      ---------------
<S>                                                    <C>                 <C>                    <C>                 <C>    

Net sales                                                         376                 1,526                 816                1,938
Cost of goods sold                                              (187)               (1,075)               (407)              (1,217)
                                                       --------------      ----------------      --------------      ---------------
      Gross profit                                                189                   451                 409                  721

Selling, general and administrative expenses                    (251)                 (247)               (467)                (444)
Interest expenses                                                (43)                     -                (79)                    -
Interest income                                                     -                     -                   -                    1
Other expenses, net                                                 -                     -                   -                    -
                                                       --------------      ----------------      --------------      ---------------
      Loss before income taxes                                  (105)                   204               (137)                  278

Provision for income taxes                                          -                     -                  15                    -
                                                       --------------      ----------------      --------------      ---------------
      Profit / (loss) before minority interests                 (105)                   204               (137)                  278
                                                                            
Minority interest                                                   1                  (29)                  15                 (41)
                                                       --------------      ----------------      --------------      ---------------
      Net income / (loss)                                       (104)                   175               (122)                  237
                                                       ==============      ================      ==============      ===============
Weighted Average Number of Shares Outstanding              35,991,964            13,591,964          35,991,964           13,591,964
Loss per common share                                          (0.00)                  0.01              (0.00)                 0.02
                                                       ==============      ================      ==============      ===============

</TABLE>


            See Notes to Unaudited Consolidated Financial Statements

                                       4
<PAGE>
                                                            

                    OPAL TECHNOLOGIES, INC. AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>


                                                                                For the six months ended
                                                                                        June 30,
                                                                        -------------------------------------
                                                                             1998                  1997
                                                                        ---------------       ---------------
                                                                            US$`000               US$`000
                                                                        ---------------       ---------------
<S>                                                                     <C>                    <C>    

Cash flow from operating activities
Net income/(losses)                                                             (122)                 237
Adjustments to reconcile net income /(loss) to net cash provided by /
(used in) operating activities -
         Depreciation of property, machinery & equipment                          60                   42
         Amortization of good will                                                 5                    4
         Amortization of licensing costs                                          27                   27
         Minority interest                                                       (15)                  41
(Increase)/Decrease in operating assets -
         Accounts receivable, net                                               (491)              (1,511)
         Prepayments, and other current assets                                   (40)                 (41)
         Inventories, net                                                       (149)                (275)
Increase /(Decrease) in operating liabilities -
         Accounts payables                                                      (125)                (180)
         Accrued liabilities                                                    (129)                 112
         Taxation payable                                                          -                    -
         Non-current payable                                                    (177)                   -
                                                                        ------------         -------------
              Net cash provided by/(used in) operating activities             (1,156)              (1,544)
                                                                        ------------         -------------
Cash flows from investing activities
Acquisition of property, machinery & equipment                                (1,610)                (180)
(Advance to) Repayment from a shareholder                                        394                    -
(Advance to) Repayment from a director                                             2                    1
(Advance to) Repayment from a related company                                      -                   90
                                                                        ------------         -------------
              Net cash provided by/(used in) investing activities             (1,214)                 (89)
                                                                        ------------         -------------
Cash flows from financing activities
        Issuance of common shares                                                  -                    -
        New loans from a shareholder                                             282                1,206
        New loans from PRC joint venture partner                                   1                  903
        Net short-term bank loan                                                 592                    -
        Other loans                                                              145
                                                                        ------------         -------------
              Net cash provided by/(used in) financing activities              1,020                2,109
                                                                        ------------         -------------
Effect of cumulative translation adjustments                                      31                 (21)
                                                                        ------------         -------------
Net increase / (decrease) in cash and bank deposits                           (1,319)                455
Cash and bank deposits, as of beginning of period                              1,453                  67
                                                                        ------------         -------------
Cash and bank deposits, as of end of period                                      134                 522
                                                                        ============         =============
</TABLE>


            See Notes to Unaudited Consolidated Financial Statements


                                       5
<PAGE>
                                                          
                    OPAL TECHNOLOGIES, INC. AND SUBSIDIARIES
                         NOTES TO UNAUDITED CONSOLIDATED
                              FINANCIAL STATEMENTS



1.   INTERIM PRESENTATION

     The interim financial statements were prepared pursuant to the requirements
     for reporting on Form 10-QSB.  The December 31, 1997 balance sheet data was
     derived  from  audited  financial  statements  but  does  not  include  all
     disclosures  required by  generally  accepted  accounting  principles.  The
     interim   financial   statements  and  notes  thereto  should  be  read  in
     conjunction with the financial statements and notes thereto included in the
     Company's  report on Form 10-KSB for the year ended  December 31, 1997.  In
     the opinion of management,  the interim  financial  statements  reflect all
     adjustments of a normal  recurring nature necessary for a fair statement of
     the results for the interim periods presented.

2.   ACQUISITION OF OPERATING BUSINESSES

     The  acquisition of Opal  Agriculture  Development  Limited and Triple Star
     Holding  Limited  by  the  Company  on  June  6,  1997  was  treated  as  a
     recapitalization  of the  acquired  companies  with the  acquired  entities
     considered  the  acquirer  (a  reverse   acquisition).   Accordingly,   the
     historical  consolidated  financial statements of the Company prior to June
     6, 1997 are those of the  combined  financial  statements  of two  acquired
     companies.  The shareholders  equity of the Company as of December 31, 1996
     has been  retroactively  restated to reflect the one for ten reverse  stock
     split,  the  reauthorization  of 50,000,000  shares of  (49,000,000  common
     shares  and  1,000,000  preferred  shares)  and the  issuance  of  Series A
     preferred  stock.  The Series A preferred stock has a vote on all corporate
     matters  equal to thirty  percent  of the total  vote,  is not  subject  to
     redemption and has a liquidation preference of $.001 per share.

3.   MINORITY INTEREST

     The minority interest reflects the 45% interest held by a non-related party
     in Beijing Opal  Agriculture  Biochemistry,  Co. Ltd., a PRC  joint-venture
     engaged  in  the  manufacture   and  production  of  organic   agricultural
     fertilizer.



                                       6
<PAGE>
                                                             

This release contains 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.  The  Company's  actual  results could differ
materially from those set forth on the forward looking statements as a result of
the risks set forth in a Company's  filings  with the  Securities  and  Exchange
Commission,  general economic conditions, and changes in the assumptions used in
making such forward looking statements.

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

     The following should be read in conjunction with the consolidated financial
statements and notes thereto.

Material Changes in Results of Operations

Three Months  Ended March 31, 1997  Compared to the Three Months Ended March 31,
1996.

Net Sales.  Net sales for the three  months  ended June 30,  1998  decreased  by
US$1,150,000 or 75% to US$376,000 from US$1,526,000 for the corresponding period
of the prior year.  This decrease was primarily due to the  devastating  Yangtze
River floods which  prohibited  customers  of the Company from  preparing  their
fields or planting their crops.

     According to the China Daily  newspaper,  floods have killed  thousands and
affected another 240 million people or a fifth of China's population. The floods
are the worst since 1954;  have  destroyed  5.58  million  homes;  have  damaged
another 12.05 million  homes and forced the  evacuation of 13.8 million  people.
More than 53.3 million acres of crops have been badly affected, and another 11.9
million acres have been totally destroyed.  Unfortunately, China may continue to
face the threat of  additional  floods  during the coming  months as this is the
period when heavy rainfall generally occurs.

     Although the striken areas cover most of Opal's major markets in China, the
Company anticipates that its sales will accelerate in the fourth quarter because
of production from the granular  fertilizer  plant and shipments to Taiwan which
has not been affected by flooding.

Gross Profit. Gross profit for the three months ended June 30, 1998 decreased by
US$262,000 or 58% to US$189,000 from US$451,000 for the corresponding  period of
the  prior  year.  This  decrease  resulted  from a decline  in sales  which was
partially  offset by a decline in cost of goods sold as a  percentage  of sales.
Cost of goods sold  totalled  49.7% of sales for the three months ended June 30,
1998, a significant reduction from 70% for the corresponding period of the prior
year. This decrease  resulted from the Company's sales being made exclusively to
third parties at normal margins during three months ended June 30, 1998 compared
to the prior period when a large  percentage of the Company's sales were made to
a related party at virtually no profit margin.

Selling,   General   and   Administrative   Expenses.   Selling,   general   and
administrative  expenses for the three  months ended June 30, 1998  increased by
US$4,000 or 2% to US$251,000 from US$247,000 for the corresponding period of the
prior year. This increase resulted from additional  supervisory costs associated
with the installation of the dry fertilizer production line.

Interest  Expense.  Interest expense increased to US$43,000 for the three months
ended June 30, 1998 from $0 for the corresponding period of the prior year. This
increase resulted from borrowings to finance machinery and equipment for the dry
fertilizer line.

Net Loss. Because of the foregoing, the net loss for the three months ended June
30,  1998  was  US$104,000  compared  with  net  income  of  US$175,000  for the
corresponding period of the prior year.

Six Months Ended June 30, 1998 Compared to the Six Months Ended June 30, 1997.

Net  Sales.  Net sales for the six  months  ended  June 30,  1998  decreased  by
US$1,122,000  or 58% to US$816,000  from  US$1,938,000  for the six months ended
June 30, 1997. This decrease was primarily due to the Yangtze River floods.

Gross Profits. Gross profits for the six months ended June 30, 1998 decreased by
US$312,000 or 43% to US$409,000  from  US$721,000 for the same period last year.
This decrease  resulted from the decline in net sales which was partially offset
by a decline in cost of goods sold as a percentage of sales.  Cost of goods sold
totalled  from 49.9% to sales for the six months  ended June 30,  1998  compared
with  62.8%  for the  corresponding  period  of the prior  year.  This  decrease
resulted from the  Company's  sales being made  exclusively  to third parties at
normal  margins  during the six months ended June 30, 1998 compared to the prior
period  when a large  percentage  of the sales  were made to a related  party at
virtually no profit margin.



                                       7
<PAGE>


Selling,   General   and   Administrative   Expenses.   Selling,   general   and
administrative  expenses  for the six months  ended June 30, 1998  increased  by
US$23,000 or 5% to US$467,000  from US$444,000 for the  corresponding  period of
the prior year. This increase is attributable  to additional  supervisory  costs
associated with the installation of the dry fertilizer line.

Interest  Expense.  Interest  expense  increased to US$79,000 for the six months
ended June 30, 1998 from $0 for the corresponding period of the prior year. This
increase resulted from borrowings to finance machinery and equipment for the dry
fertilizer line.

Net Loss.  Because of the foregoing,  the net loss for the six months ended June
30,  1998  was  US$122,000  compared  with  net  profit  of  US$237,000  for the
corresponding period of the prior year.

Changes in Financial Condition, Liquidity and Capital Resources

     For the past  twelve  months,  the  Company  has funded its  operating  and
capital   requirements   with  loans  from  the  parent   company  and  its  PRC
joint-venture partner, the sale of common stock, a bank loan and a related party
short-term  loan. As of June 30, 1998,  the Company had cash of  US$134,000  and
working  capital of  US$1,504,000.  This compares  with cash of  US$522,000  and
working capital of US$2,805,000 as of June 30, 1997.

     Net cash used in operating activities increased to US$1,156,000 for the six
months ended June 30, 1998 from  US$1,544,000  for the six months ended June 30,
1997.  This  increase  resulted  from a loss from  operations,  an  increase  in
accounts receivable,  other assets and inventories which was partially offset by
a decrease in accounts payable, accrued liabilities and non-current payables.

     Net cash used in investing activities increased to US$1,214,000 for the six
months  ended June 30,  1998 from  US$89,000  for the six months  ended June 30,
1997.  This increase is primarily  due to the  additional  expenditures  for the
acquisition  of machinery and equipment for the dry  fertilizer  line which were
partially offset by repayment of an advance from a shareholder.

     Net cash provided by financing activities decreased to US$1,020,000 for the
six months  ended June 30, 1998 from  US$2,109 for the six months ended June 30,
1997. This decrease is attributable to reduced loans from shareholders and joint
venture  partners  which were  partially  offset by a  short-term  bank loan and
another loan.

     To provide for its working capital requirements and to repay its short term
debt,  the  Company  during  the next six months  will need to place  additional
equity or develope  additional lending sources without which the Company will be
unable to meet its business plans.


                                       8
<PAGE>

                           PART II - OTHER INFORMATION


Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits

          4.1  Warrant - Corinthian Capital Limited

          27.1 Financial Data Schedule

     (b)  Reports on Form 8-K

 
                                   SIGNATURES

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


                                        OPAL TECHNOLOGIES, INC.


Date: August 19,  1998              By:  /s/ John K. C. Koon
                                         ---------------------------------------
                                        John K. C. Koon
                                        President and Chief Executive Officer



Dated: August 19, 1998              By: /s/ Kenneth Poon
                                        ----------------------------------------
                                        Kenneth Poon
                                        Chief Financial Officer



                                       9