8-K

                                   UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 8-K
                                 CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) August 10, 2004
(August 10, 2004)



                             HALLADOR PETROLEUM COMPANY
               (Exact name of registrant as specified in charter)


         Colorado                   0-14731             84-1014610
  (State or other juris-          (Commission         (IRS Employer
 diction of incorporation)        file number)      Identification No.)


                1660 Lincoln Street, Suite 2700, Denver, CO 80264
               (Address of principal executive offices) (Zip Code)


      Registrant's telephone number, including area code: 303.839.5504


Item 5.  Other Events and Regulation FD Disclosure

Hallador Petroleum Company today issued a press release announcing that
it had entered into an agreement to sell its California properties.

A copy of the press release follows as Exhibit 99.

Item 7.  Financial Statements and Exhibits

     (c) Exhibits

     99     Press release dated August 10, 2004.

                               SIGNATURES

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 hereunto duly authorized.

                                  HALLADOR PETROLEUM COMPANY
                                         (Registrant)


Dated: August 10, 2004             By/S/Victor P. Stabio, CEO

EX-99

                                                       HALLADOR PETROLEUM, LLP
                                               1660 Lincoln Street, Suite 2700
                                                              Denver, Co 80264
                                                          Phone:  303/839-5504
                                                            Fax:  303/832-3013


                              FOR IMMEDIATE RELEASE


PRESS RELEASE                                  Contact: Victor P. Stabio, CEO
                                               Phone:   303-839-5504, ext. 305

August 10, 2004, Denver, Colorado

The Hallador Petroleum group of companies (Hallador) announced today that
it has entered in an agreement with E&B Natural Resources
Management Corporation (a privately owned corporation) to sell all
of Hallador's interest in Hallador Production Company and other properties
in the South Cuyama Field and adjacent exploration areas in Santa
Barbara County, California for $23 million with an effective date of
June 1, 2004.  At closing, scheduled for September 30, 2004 and subject
to customary closing conditions, Hallador will receive $19.5 million cash
and $3.5 million in a note due on September 30, 2005.

The public company, Hallador Petroleum Company (HPC) is entitled to 70%
of the above amounts or $13.65 million cash and its share of the note in
the amount of $2.8 million.  These amounts will be reduced by
closing adjustments and employee bonuses, stock option payments,
and retention payments of approximately 15%. Following the sale, HPC
and Hallador, will have no California properties, but will continue
its operations in New Mexico and Texas.  These properties of Hallador
have remaining reserves of approximately 2.0 BCF of natural gas
equivalents, of which HPC owns 1.5 BCF of natural gas equivalents.

After closing, the Hallador Board, will meet to consider how to best
utilize the cash from the California sale.  Among the options the Board
will consider is a special dividend.  Hallador Petroleum Company
has approximately 7.1 million shares outstanding.

Hallador, an oil and gas company headquartered in Denver, Colorado, is
publicly traded on the OTC bulletin board under the symbol HPCO.BB.

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