<PAGE>
 
As filed with the Securities and Exchange Commission on July 17, 1998

                                                             File No. 333-______

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549
                             ----------------------
                                    Form S-8
                             REGISTRATION STATEMENT
                                     Under
                           THE SECURITIES ACT OF 1933
                             ----------------------

                           CANARGO ENERGY CORPORATION
                      (formerly FOUNTAIN OIL INCORPORATED)
               (Exact name of issuer as specified in its charter)

        DELAWARE                                      91-0881481
(State or other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                    Identification No.)

                  1580 Guinness House, 727 - 7th Avenue S.W.,
                            Calgary, Alberta T2P 0Z5
                    (Address of principal executive offices)
                      ___________________________________

                     CANARGO ENERGY INC. STOCK OPTION PLAN
                            (Full title of the Plan)
                      ____________________________________

                                Michael Binnion
                           CANARGO ENERGY CORPORATION
                  1580 Guinness House, 727 - 7th Avenue S.W.,
                            Calgary, Alberta T2P 0Z5
                            Telephone (403) 777-1185
           (Name, address and telephone number of agent for service)
                     _____________________________________


If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box.  [x]
<PAGE>
 
                        CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
==============================================================================================================================

                                                          Proposed                  Proposed
                                                          Maximum                   Maximum
Title of Securities             Amount Being           Offering Price              Aggregate                  Amount of
Being Registered                 Registered              Per Share               Offering Price            Registration Fee
------------------------------------------------------------------------------------------------------------------------------
<S>                         <C>                     <C>                    <C>                          <C>
Common Stock                  
$.10 par value                 988,000 (1) shares         $1.86 (2)              $1,836,420.30 (2)             $541.74 
------------------------------------------------------------------------------------------------------------------------------


(1)  This Registration Statement also covers such indeterminable number of
     additional shares as may become deliverable as a result of future
     adjustments in accordance with the terms of the Plan.

(2)  Determined in accordance with Rule 457(h) under the Securities Act of 1933,
     as amended, on the basis of the purchase price at which the options may be
     exercised.  The "Price Per Share" represents the average price per share
     based on the number of shares being registered and the maximum aggregate
     offering price.  The currency exchange rate as of July 13, 1998 is $1
     Canadian = $ .6759 U.S.

=============================================================================================================================
</TABLE> 

                                       ii
<PAGE>
 
                                    PART II


Item 3.   Incorporation of Documents by Reference

          The following documents which have been filed by the Company with the
Securities and Exchange Commission are incorporated by reference as of their
respective dates and are a part hereof:

          (a)  Annual Report on Form 10-K as amended by Form 10-K/A for the year
ended December 31, 1997;

          (b) Quarterly Report on Form 10-Q as amended by Form 10-Q/A and Form
10-Q/A-2 for the quarter ended March 31, 1998;

          (c) Form 8-K dated January 27, 1998;

          (d) Form 8-K dated July 7, 1998; and

          (d) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-B and in any amendment or report filed for the
purpose of amending such description.

          Additionally, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended, prior to the filing of a post-effective amendment hereto which
indicates that all of the shares of the Common Stock offered hereby have been
sold or which deregisters all such shares then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents.

Item 4.   Description of Securities

          Not applicable.

Item 5.   Interests of Named Experts and Counsel

          None.

Item 6.   Indemnification of Directors and Officers

          The Delaware General Corporate Law makes provision for the
indemnification of officers and directors in terms sufficiently broad to
indemnify officers and directors under certain circumstances from liabilities
(including reimbursement for expenses incurred) arising under the Securities Act
of 1933 (the "Securities Act").  The Company's Bylaws require the Company to
indemnify its officers and directors to the fullest extent authorized by
Delaware law.

                                       1
<PAGE>
 
          Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been informed
that in the opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.

Item 7.   Exemption from Registration Claimed

          Not applicable.

Item 8.   Exhibits

          4.1  Canargo Energy Inc. Stock Option Plan.

          5.1  Opinion of Counsel.

          23.1 Consent of Independent Accountants.

          23.2 Consent of Counsel - contained in Exhibit 5.1.

          24.1 Power of Attorney, contained at page 4.

Item 9.   Undertakings

          The Company hereby undertakes:   (1) to file, during any period in
which offers or sales of the Common Stock are being made, a post-effective
amendment to this registration statement:   (i) to include any prospectus
required by Section 10(a)(3) of the Securities Act of 1933, as amended (the
"Securities Act");   (ii) to reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement;   (iii) to include any material information with respect
to the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement; provided that if the information required in clauses (i) and (ii)
above to be included in a post-effective amendment hereto is contained in one or
more periodic reports filed by the registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934, no post-effective amendment hereto
shall be required;  (2) that, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and  (3) to remove from registration by means of a post-
effective amendment any of the securities being registered which remain unsold
at the termination of the offering.

                                       2
<PAGE>
 
          Additionally, the undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the Company's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

          Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.  In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

                                       3
<PAGE>
 
                                   SIGNATURES

          Pursuant to the requirements of the Securities Act of 1933, the
Company certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Calgary, Alberta, Canada, on July 16, 1998.

                                     CANARGO ENERGY CORPORATION


                                     By: /s/David Robson
                                         ---------------------- 
                                         David Robson,
                                         Chief Executive Officer

                               POWER OF ATTORNEY

          KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
follows constitutes and appoints each of MICHAEL BINNION and SUSAN E. PALMER,
and either of them, his true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, and hereby
ratifying and confirming all that said attorney-in-fact, or his or her
substitute, may lawfully do or cause to be done by virtue hereof.

          Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.

<TABLE>
<CAPTION>
Signature                                 Title                                                   Date
-------------------------                 ---------------------------------------------------     -------------
<S>                                        <C>                                                    <C>
/s/David Robson                            Chief Executive Officer and                            July 16, 1998
-------------------------                  Director (Principal Executive Officer)
David Robson                               

/s/Michael Binnion                         President, Chief Financial Officer and                 July 16, 1998
-------------------------                  Director (Principal Financial and
Michael Binnion                            Accounting Officer)              
                                           
/s/Robert A. Halpin                        Director                                               July 16, 1998
-------------------------
Robert A. Halpin
</TABLE> 

                                       4
<PAGE>
 
<TABLE>
<CAPTION>
<S>                                        <C>                                                    <C>
/s/ J.F. Russell Hammond                   Director                                               July 16, 1998
-------------------------
J.F. Russell Hammond

/s/Peder Paus                              Director                                               July 16, 1998
-------------------------
Peder Paus

/s/Nils N. Trulsvik                        Director                                               July 16, 1998
-------------------------
Nils N. Trulsvik
</TABLE>

                                       5
<PAGE>
 
                           CANARGO ENERGY CORPORATION

                        FORM S-8 REGISTRATION STATEMENT

                                 Exhibit Index
                                 -------------


     4.1  CanArgo Energy Inc. Stock Option Plan.
 
     5.1  Opinion of Counsel.
 
     23.1 Consent of Independent Accountants.
 
     23.2 Counsel of Counsel -- contained in Exhibit 5.1.
  
     24.1 Power of Attorney -- contained at page 4.

                                       6
[{"type": "S-8", "sequence": "1", "description": "FORM S-8", "secsgml_size_bytes": 14379}]
{"company-data": {"conformed-name": "CANARGO ENERGY CORP", "cik": "0000310316", "assigned-sic": "5084", "irs-number": "910881481", "state-of-incorporation": "OK", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-59367", "film-number": "98668262"}, "business-address": {"street1": "1400 BROADFIELD BLVD", "street2": "SUITE 100", "city": "HOUSTON", "state": "TX", "zip": "77084-5163", "phone": "7134926992"}, "mail-address": {"street1": "1400 BROADFIELD BLVD", "street2": "SUITE 100", "city": "HOUSTON", "state": "TX", "zip": "777084-516"}, "former-company": [{"former-conformed-name": "FOUNTAIN OIL INC", "date-changed": "19950119"}, {"former-conformed-name": "ELECTROMAGNETIC OIL RECOVERY INC", "date-changed": "19920703"}, {"former-conformed-name": "ORS CORP /OK/", "date-changed": "19910515"}]}
As filed with the Securities and Exchange Commission on July 17, 1998

                                                             File No. 333-______

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549
                             ----------------------
                                    Form S-8
                             REGISTRATION STATEMENT
                                     Under
                           THE SECURITIES ACT OF 1933
                             ----------------------

                           CANARGO ENERGY CORPORATION
                      (formerly FOUNTAIN OIL INCORPORATED)
               (Exact name of issuer as specified in its charter)

        DELAWARE                                      91-0881481
(State or other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                    Identification No.)

                  1580 Guinness House, 727 - 7th Avenue S.W.,
                            Calgary, Alberta T2P 0Z5
                    (Address of principal executive offices)
                      ___________________________________

                     CANARGO ENERGY INC. STOCK OPTION PLAN
                            (Full title of the Plan)
                      ____________________________________

                                Michael Binnion
                           CANARGO ENERGY CORPORATION
                  1580 Guinness House, 727 - 7th Avenue S.W.,
                            Calgary, Alberta T2P 0Z5
                            Telephone (403) 777-1185
           (Name, address and telephone number of agent for service)
                     _____________________________________

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box.  [x]
CALCULATION OF REGISTRATION FEE
==============================================================================================================================

                                                          Proposed                  Proposed
                                                          Maximum                   Maximum
Title of Securities             Amount Being           Offering Price              Aggregate                  Amount of
Being Registered                 Registered              Per Share               Offering Price            Registration Fee
------------------------------------------------------------------------------------------------------------------------------
Common Stock                  
$.10 par value                 988,000 (1) shares         $1.86 (2)              $1,836,420.30 (2)             $541.74 
------------------------------------------------------------------------------------------------------------------------------

(1)  This Registration Statement also covers such indeterminable number of
     additional shares as may become deliverable as a result of future
     adjustments in accordance with the terms of the Plan.

(2)  Determined in accordance with Rule 457(h) under the Securities Act of 1933,
     as amended, on the basis of the purchase price at which the options may be
     exercised.  The "Price Per Share" represents the average price per share
     based on the number of shares being registered and the maximum aggregate
     offering price.  The currency exchange rate as of July 13, 1998 is $1
     Canadian = $ .6759 U.S.

=============================================================================================================================
ii
PART II

Item 3.   Incorporation of Documents by Reference

          The following documents which have been filed by the Company with the
Securities and Exchange Commission are incorporated by reference as of their
respective dates and are a part hereof:

          (a)  Annual Report on Form 10-K as amended by Form 10-K/A for the year
ended December 31, 1997;

          (b) Quarterly Report on Form 10-Q as amended by Form 10-Q/A and Form
10-Q/A-2 for the quarter ended March 31, 1998;

          (c) Form 8-K dated January 27, 1998;

          (d) Form 8-K dated July 7, 1998; and

          (d) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-B and in any amendment or report filed for the
purpose of amending such description.

          Additionally, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended, prior to the filing of a post-effective amendment hereto which
indicates that all of the shares of the Common Stock offered hereby have been
sold or which deregisters all such shares then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents.

Item 4.   Description of Securities

          Not applicable.

Item 5.   Interests of Named Experts and Counsel

          None.

Item 6.   Indemnification of Directors and Officers

          The Delaware General Corporate Law makes provision for the
indemnification of officers and directors in terms sufficiently broad to
indemnify officers and directors under certain circumstances from liabilities
(including reimbursement for expenses incurred) arising under the Securities Act
of 1933 (the "Securities Act").  The Company's Bylaws require the Company to
indemnify its officers and directors to the fullest extent authorized by
Delaware law.

                                       1
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been informed
that in the opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.

Item 7.   Exemption from Registration Claimed

          Not applicable.

Item 8.   Exhibits

          4.1  Canargo Energy Inc. Stock Option Plan.

          5.1  Opinion of Counsel.

          23.1 Consent of Independent Accountants.

          23.2 Consent of Counsel - contained in Exhibit 5.1.

          24.1 Power of Attorney, contained at page 4.

Item 9.   Undertakings

          The Company hereby undertakes:   (1) to file, during any period in
which offers or sales of the Common Stock are being made, a post-effective
amendment to this registration statement:   (i) to include any prospectus
required by Section 10(a)(3) of the Securities Act of 1933, as amended (the
"Securities Act");   (ii) to reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement;   (iii) to include any material information with respect
to the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement; provided that if the information required in clauses (i) and (ii)
above to be included in a post-effective amendment hereto is contained in one or
more periodic reports filed by the registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934, no post-effective amendment hereto
shall be required;  (2) that, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and  (3) to remove from registration by means of a post-
effective amendment any of the securities being registered which remain unsold
at the termination of the offering.

                                       2
Additionally, the undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the Company's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

          Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.  In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

                                       3
SIGNATURES

          Pursuant to the requirements of the Securities Act of 1933, the
Company certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Calgary, Alberta, Canada, on July 16, 1998.

                                     CANARGO ENERGY CORPORATION

                                     By: /s/David Robson
                                         ---------------------- 
                                         David Robson,
                                         Chief Executive Officer

                               POWER OF ATTORNEY

          KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
follows constitutes and appoints each of MICHAEL BINNION and SUSAN E. PALMER,
and either of them, his true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as the undersigned might or could do in person, and hereby
ratifying and confirming all that said attorney-in-fact, or his or her
substitute, may lawfully do or cause to be done by virtue hereof.

          Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature                                 Title                                                   Date
-------------------------                 ---------------------------------------------------     -------------
/s/David Robson                            Chief Executive Officer and                            July 16, 1998
-------------------------                  Director (Principal Executive Officer)
David Robson                               

/s/Michael Binnion                         President, Chief Financial Officer and                 July 16, 1998
-------------------------                  Director (Principal Financial and
Michael Binnion                            Accounting Officer)              
                                           
/s/Robert A. Halpin                        Director                                               July 16, 1998
-------------------------
Robert A. Halpin
4
/s/ J.F. Russell Hammond                   Director                                               July 16, 1998
-------------------------
J.F. Russell Hammond

/s/Peder Paus                              Director                                               July 16, 1998
-------------------------
Peder Paus

/s/Nils N. Trulsvik                        Director                                               July 16, 1998
-------------------------
Nils N. Trulsvik
5
CANARGO ENERGY CORPORATION

                        FORM S-8 REGISTRATION STATEMENT

                                 Exhibit Index
                                 -------------

     4.1  CanArgo Energy Inc. Stock Option Plan.
 
     5.1  Opinion of Counsel.
 
     23.1 Consent of Independent Accountants.
 
     23.2 Counsel of Counsel -- contained in Exhibit 5.1.
  
     24.1 Power of Attorney -- contained at page 4.

                                       6