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

                                   FORM 12B-25

                           NOTIFICATION OF LATE FILING

(Check one)
 [ ] Form 10-K   [ ] Form 20-F   [ ] Form 11-K   [X] Form 10-Q   [ ] Form N-SAR

                      For Period Ended: September 30, 1998


                       [ ] Transition Report on Form 10-K
                       [ ] Transition Report on Form 20-F
                       [ ] Transition Report on form 11-K
                       [ ] Transition Report on Form 10-Q
                       [ ] Transition report on form N-SAR
 
                 For the Transition Period Ended: ______________

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READ ATTACHED INSTRUCTION SHEET BEFORE PREPARING FORM. PLEASE PRINT OR TYPE.

      NOTHING IN THIS FORM SHALL BE CONSTRUED TO IMPLY THAT THE
      COMMISSION HAS VERIFIED ANY INFORMATION CONTAINED HEREIN.
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      If the notification relates to a portion of the filing checked above,
identify the item(s) to which the notification relates:
 
PART 1 - REGISTRANT INFORMATION (Official Text)

      Full Name of Registrant:
            TEI, INC.

      Former Name if Applicable:
            Tankology Environmental, Inc.


      Address of Principal Executive Office (Street and Number):
            2900 North Loop West, Suite 1230


      City, State and Zip code
            Houston, Texas 77092

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PART II - RULES 12b-25 (b) and (c)
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If the subject report could not be filed without unreasonable effort or expense
and the Registrant seeks relief pursuant to Rule 12b-25(b) the following should
be completed. (check box if appropriate)

[X]   (a) the response described in reasonable detail in Part III of this form
could not be eliminated without unreasonable effort or expense;

[X]   (b) The subject annual report, semi-annual report, transition report on
form 10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof will be filed on or
before the fifteenth calendar day following the prescribed due date; or the
subject quarterly report or transition report on form 10-Q, or portion thereof
will be filed on or before the fifth calendar day following the prescribed due
date; and

[ ]   (c) The accountant's statement or other exhibit required by Rule 12b-25(c)
has been attached, if applicable.

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PART III - NARRATIVE (Official Text)
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State below in reasonable detail the reasons why the form 10-K, 11-K, 10-Q,
N-SAR, or the transition report or portion thereof, could not be filed within
the prescribed time period. (Attach Extra Sheets if Needed)

TEI, Inc. is unable to complete all required internal and third party reviews
necessary to verify the information and disclosure contained in its Form 10-Q
for the quarter ended September 30, 1998 without incurring unreasonable effort
and expense to file such Form 10-Q within the prescribed time period.


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PART IV - OTHER INFORMATION (Official Text)
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(1)   Name and telephone number of person to contact in regard to this
      notification

      [NAME]                  [AREA CODE]                   [NUMBER]
      Donald R. Campbell      (713)                         263-7510 

(2)   Have all other periodic reports required under Section 13 or 15(d) of the
      Securities Exchange Act of 1934 or Section 30 of the Investment Company
      Act of 1940 during the preceding 12 months or for such shorter period that
      the Registrant was required to file such report(s) been filed? If answer
      is no, identify reports(s).

                                 [X] Yes [ ] No

(3)   Is it anticipated that any significant change in results of operations
      from the corresponding period for the last fiscal year will be reflected
      by the earnings statement to be included in the subject report or portion
      thereof?

                                 [ ] Yes [X] No
________________________________________________________________________________


                                    TEI, Inc.
                  (Name of Registrant as Specified in Charter)

has caused this notification to be signed on its behalf by the undersigned
hereunto duly authorized.

By  /s/ DONALD R. CAMPBELL                  Date: NOVEMBER 16, 1998
        Donald R. Campbell
        President,
        Chief Executive Officer,
        Chief Operating Officer
        and Secretary