Rule 424(b)(3)
                                                          Registration Statement
                                                                    No. 33-52496

                              SUPPLEMENT TO PROSPECTUS

                               HONDO OIL & GAS COMPANY

                   300,000 SHARES OF COMMON STOCK, $1.00 PAR VALUE
                                ____________________

          This Supplement to Prospectus (the "Supplement") supplements certain
     information contained in the Prospectus dated February 10, 1995 (the
     "Prospectus") with respect to the offer for sale of 3,609,200 shares (the
     "Shares") of $1.00 par value common stock ("Common Stock") of Hondo Oil &
     Gas Company (the "Company") offered for the account of The Hondo Company
     (the "Selling Shareholder") by the Selling Shareholder and/or by Lonrho
     Plc, the holder of a pledge of the Shares, as more fully described in the
     Prospectus.

          This Supplement relates to the sale by the Selling Shareholder of
     300,000 of the Shares pursuant to a Revised Settlement Agreement dated
     December 20,1995, among Lonrho Plc, Lonrho, Inc., Scottsdale Princess,
     Inc., Selling Shareholder, Robert O. Anderson, W. Phelps Anderson and
     Robert B. Anderson (as amended on January 5, 1996 and May 14, 1996) through
     which the Selling Shareholder is delivering to Robert O. Anderson, W.
     Phelps Anderson, Robert B. Anderson, and SunValley Energy Corporation
     150,290, 60,348, 60,348 and 29,014 of the Shares, respectively, in
     consideration of the delivery by such persons and the redemption and
     cancellation of common stock representing an aggregate 6.4% interest in
     Selling Shareholder.

                                ____________________

     SEE THE RISK FACTORS COMMENCING ON PAGE 4 OF THE ACCOMPANYING PROSPECTUS
     UNDER THE CAPTION "CERTAIN INVESTMENT CONSIDERATIONS" FOR A DISCUSSION OF
     CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY THE PROSPECTIVE INVESTOR.
                                ____________________

     THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
     AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
     SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
     PASSED UPON THE ACCURACY OR ADEQUACY OF THIS SUPPLEMENT.  ANY
     REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
                                ____________________

            The date of this Supplement to Prospectus is January 10, 1997