Exhibit 10.1

Audit Committee Charter

I. Purpose

The Committee’s primary purpose is to assist the Board in fulfilling its
oversight responsibilities with respect to:

i.

The integrity of the annual and quarterly financial statements that are provided
to shareholders and regulatory bodies;

ii.

The Corporation’s compliance with accounting and finance based legal and
regulatory requirements;

iii.

The independent auditor’s qualifications and independence;

iv.

The system of internal accounting and financial reporting controls that
management has established,

v.

The performance of the internal and independent audit process and the
independent auditor,

vi.

Oversight of the Internal Audit function.

The Committee shall also prepare such reports as are required to be prepared by
it by applicable securities law. In addition, the Committee provides an avenue
for communication between each of internal audit, the independent auditors,
financial and senior management and the Board. The Committee shall have a clear
understanding with the independent auditors that they must maintain an open and
transparent relationship with the Committee, and that the ultimate
accountability of the independent auditors is to the Committee, as
representatives of the shareholders. The Committee shall make regular reports to
the Board concerning its activities. The Committee, in its capacity as a
committee of the Board, subject to shareholder approval requirements, is
directly responsible for the appointment, compensation, retention and oversight
of the work of the independent auditors.

II. Composition of the Committee

The Committee will be comprised of directors and when deemed necessary:
independent legal, financial or other advisors as agreed upon by unanimous vote
by the Board.

All of the Committee members must be independent. To be considered independent,
a director must, as a minimum, meet the criteria for independence:

a)

Required by the applicable securities regulations and any applicable laws, rules
and regulations; and

b)

Established by the Board in the Corporation’s Corporate Governance Guidelines or
otherwise;  

c)

Established by the U.S. Securities and Exchange Commission or other regulatory
jurisdictions or commissions.

In addition, a member of the Committee may not, other than in his or her
capacity as a member of the Committee, the Board or any other Board committee,
receive from the Corporation, directly or indirectly, any consulting, advisory
or other compensatory fees. In recognition of the greater responsibilities and
obligations expected of members of the Committee, a member of the Committee may
receive additional directors’ fees from the Corporation for serving on the
Committee. Such additional fees may be greater than those fees paid to other
directors, but should be commensurate with the time and effort expected to be
expended by such Committee member in the performance of his or her duties.

All members of the Committee shall have a working familiarity with basic finance
and accounting practices, and at least one member of the Committee shall have
accounting or related financial management expertise and, where possible, at
least one member of the Committee shall qualify as an “audit committee financial
expert” within the meaning of applicable securities legislation.

Members of the Committee may not serve on the audit committees of more than two
additional public companies without the approval of the Board.

Committee members shall serve until the successors shall be duly designated and
qualified. Any member may be removed at any time, with or without cause, by a
majority of the Board then in office. Any vacancy in the Committee occurring for
any cause may be filled by a majority of the Board then in office.

The Committee’s chairman shall be designated by the Board. A majority of the
members of the Committee shall constitute a quorum for the transaction of
business and the act of a majority of those present at any meeting at which
there is a quorum shall be the act of the Committee.

The Committee may form and delegate authority to subcommittees when appropriate.

III. Frequency of Meetings

Monthly  (by conference call and quarterly at company headquarters )

IV. Meetings

The Committee shall meet at least four times a year and as many additional times
as the Committee deems necessary to carry out its duties effectively.

Only members of the Committee are entitled to be present at a Committee meeting.
The Committee may extend an invitation to any person to attend all or part of
any meeting of the Committee which it considers appropriate including a person
who will take minutes.

The Committee shall not grant an automatic or standing right of attendance to
executives or other officers of the Company, who shall only attend meetings on
the specific invitation of the Committee.  At the invitation of the Committee,
the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
and Chief Audit Officer and representatives of the independent auditors shall be
expected to attend all meetings.  Additionally, if the Board deems it necessary,
it may select, by unanimity, a Board director to coordinate various committees
of the Board and that director will receive specific invitation to Audit
Committee meetings without committee voting rights. That director will receive
additional directors’ fees from the Corporation for serving in this capacity;
these fees will be commensurate with the extra effort expended in the capacity
as Board coordinator, and approved by the Chairman.

A quorum for a meeting of the Committee is two members. A duly convened meeting
of the Committee at which a quorum is present is competent to exercise all or
any of the authorities, powers or discretions vested in or exercisable by, the
Committee.

Minutes of the proceedings and resolutions of all meetings shall be maintained
(including the names of those present and in attendance) and the Chairman of the
Committee will circulate the minutes of the meetings to all members of the
Board.  Decisions of the Committee will be reported on an oral basis by the
Chairman of the Committee, as appropriate, at the next Board meeting.

The Chief Audit Officer or independent auditors may request a meeting of the
Committee if they deem that one is necessary.

At least once a year the Committee shall meet with the independent auditor and
separately with the Chief Audit Officer without any Executive Directors or any
other officers of the Company present, except the Company Secretary if requested
by the Committee Chairman.

V. Annual General Meeting

The Chairman of the Committee shall attend the Annual General Meeting of the
company and shall answer questions through the Chairman of the Board, on the
Audit Committee’s activities and their responsibilities.

VI. Authority

The Board of Directors has granted the Committee the authority herein provided.
The Committee has been, and shall be, granted unrestricted access to all
information and all employees have been, and shall be, directed to cooperate as
requested by members of the Committee.

The Board has the power, acting as a Company or committee, to hire independent
legal, financial or other advisors as it may deem necessary.  Such action may be
approved in either of two ways, (i) in the annual budget, or (2) by unanimous
vote of the Board.  Each committee has the right to hire independent legal,
financial or other advisors as it may deem necessary, provided that funds are
approved in the committee budget or by request to the Board.  The Chairman of a
Board committee seeking such approval shall make the request through the
Chairman of the Board or the Lead Director.

The Company must provide for appropriate funding, as determined by the
Committee, in its capacity as a committee of the Board, for payment of
compensation to any registered public accounting firm engaged for the purpose of
preparing or issuing an audit report or performing other audit, review or attest
services.

Subject to the financial approval, the Committee has the authority to retain, at
the Corporation’s expense, persons having special competencies (including,
without limitation, legal, accounting, actuarial, or other consultants and
experts) to assist the Committee in fulfilling its responsibilities. The
Committee has the sole authority to approve the fees and other terms of
retention of such experts.  

VII. Responsibilities

To carry out its oversight responsibilities, the Committee shall:

A. Audit Specific Duties

(i) Auditor Qualifications and Selection

1.

Subject to applicable law requiring shareholder approval of auditors, be solely
responsible for selecting, retaining, compensating, overseeing and, where
necessary, terminating the independent auditors, who shall be a “Registered
Public Accounting Firm” within the meaning of applicable securities legislation
in effect from time to time. The independent auditor shall be required to report
directly to the Committee. The Committee shall be entitled to adequate funding
from the Corporation for the purpose of compensating the independent auditor for
completing an audit and audit report or performing other audit, review or attest
services for the Corporation.

2.

Auditors of foreign divisions, subsidiaries or affiliates should be registered
with the U.S. Public Accounting Oversight Board.

3.

There will be an evaluation of the independent auditor’s qualifications,
performance and independence. As part of that evaluation, at least annually
obtain and review a report by the independent auditor describing: the firm’s
(auditor’s) internal quality-control procedures; any material issues raised by
the most recent internal quality-control review, or peer review, of the firm, or
by any inquiry or investigation by governmental or professional authorities,
within the preceding five years, respecting one or more independent audits
carried out by the firm, and any steps taken to deal with any such issues; and
(to assess the auditor’s independence) all relationships between the independent
auditor and the Corporation. Ensure that the independent auditors do not provide
non-audit services that would disqualify them as independent under applicable
regulations. Review the experience and qualifications of the senior members of
the independent auditor team and the quality control procedures of the
independent auditor. Ensure that the lead audit partner of the independent
auditor is replaced periodically, in accordance with regulatory requirements
applicable to the Corporation. Recommend to the Board guidelines for the
Corporation’s hiring of senior employees and former employees of the independent
auditor who were engaged on the Corporation’s account.

(ii) Audit Process

1.

Pre-approve all auditing services (which may entail comfort letters in
connection with securities underwritings). Subject to applicable securities
laws, pre-approve the retention of the independent auditor for any significant
non-audit services permitted under applicable securities law and the fee for
such services. All pre-approvals of such non-audit services shall be disclosed
as required by applicable securities law. The Committee may delegate to one or
more of its members the authority to grant pre-approvals required hereunder
provided that any pre-approvals so granted are presented in writing to the
Committee at the next regularly scheduled meeting.

2.

Meet with the independent auditor prior to the audit to review the scope and
general extent of the independent auditor’s annual audit including the planning
and staffing of the audit. This review shall include an explanation from the
independent auditors of the factors considered by the auditors in determining
their audit scope, including the major risk factors.

3.

Require the independent auditor to provide a timely report setting forth (i) all
critical accounting policies, significant accounting judgments and practices to
be used; (ii) all alternative treatments of financial information within
Generally Accepted Accounting Principles (“GAAP”) that have been discussed with
management, ramifications of the use of such alternative disclosures and
treatments and the treatment preferred by the independent auditor; and, (iii)
other material written communications between the independent auditor and
management.

4.

Take all reasonable steps to ensure that officers, directors or persons acting
under their direction are aware that they are prohibited from coercing,
manipulating, misleading or fraudulently influencing the independent auditors
when such person knew or should have known that the action could result in
rendering the financial statements materially misleading.

5.

Upon completion of the annual audit, review the following with management and
the independent auditors:

·

The annual financial statements including related footnotes and the MD&A to be
included in the Corporation’s annual report to shareholders on Form 10-K.

·

The significant audit and accounting judgments and reporting principles,
practices and procedures applied by the Corporation in preparing its financial
statements including any newly adopted accounting policies and the reasons for
their adoption.

·

Any transactions accounted for by the Corporation where management has obtained
opinion letters providing that hypothetical transactions accounted for in a
similar manner are accounted for in accordance with GAAP (letters issued in
accordance with Statement of Auditing Standards 50 - “Reports on the Application
of Accounting Principles”).

·

The results of the audit of the financial statements and the related audit
report thereon. The independent auditors should confirm to the Committee that no
limitations were placed on the scope or nature of their audit procedures.

·

The levels of errors identified during the audit, obtaining explanations from
management and, where necessary the independent auditors, as to why certain
errors might remain unadjusted.

·

Major issues that arose during the course of the audit and have subsequently
been resolved and those issues that have been left unresolved.

·

Significant changes to the audit plan, if any, and any serious disputes or
difficulties with management encountered during the audit, including any
problems or disagreements with management which, if not satisfactorily resolved,
would have caused the independent auditors to issue a non-standard report on the
Corporation’s financial statements.

·

The co-operation received by the independent auditors during their audit,
including access to all requested records, data and information.

·

Any other matters not described above that are required to be communicated by
the independent auditors to the Committee pursuant to Statement of Auditing
Standards 61 – “Communication With Audit Committee”, as amended by Statement of
Auditing Standards 90 – “Audit Committee Communications”.

6.

Generally, as part of the review of the annual financial statements, receive an
oral report(s), at least annually, from the Corporation’s general counsel
concerning legal and regulatory matters that may have a material impact on the
financial statements.

B. Ongoing Duties

1.

Discuss guidelines and policies with respect to risk assessment and risk
management. Discuss major financial risk exposures and steps management has
taken to monitor and control such exposures.

2.

Review and reassess the adequacy of this Mandate annually and recommend any
proposed changes to the Board for approval.

3.

Regularly report to the Board and review with the Board any issues that arise
with respect to the quality or integrity of the Corporation’s financial
statements, the Corporation’s compliance with legal or regulatory requirements,
the performance and independence of the Corporation’s independent auditor, and
the performance of the internal audit function.

4.

Review interim, 10Q,  and annual financial statements, the Company's annual
report, preliminary announcements and related formal statements before
submission to the Board, paying particular attention to:

·

critical accounting policies and practices and any changes therein;

·

decisions requiring a major element of judgment;

·

the extent to which the financial statements are affected by any unusual
transactions in the year and how they are disclosed;

·

the clarity and completeness of disclosures and report its views to the Board
where, following its review, the Committee is not satisfied with any aspect of
the proposed financial reporting by the Company;

·

significant adjustments resulting from the audit;

·

the going concern assumption;

·

compliance with applicable accounting standards;

·

compliance with stock exchange and legal requirements,

·

reviewing the Company's statement on internal control systems prior to
endorsement by the Board and to review the policies and process for identifying
and assessing business risks and the management of those risks by the Company.

·

The Chair of the Committee may represent the entire Committee for purposes of
this review.

5.

Review the general types and presentation format of information that it is
appropriate for the Corporation to disclose in earnings press releases or other
earnings guidance provided to analysts and rating agencies.

6.

Prior to each annual news release reporting proven and probable reserves, review
with the director of reserves reporting the Corporation's policies, procedures
and methodology regarding the reporting of proven and probable reserves and
non-reserve mineralized material.

7.

Establish sub-committees for Disclosure Review, Reserves Review and Finance or
else the Audit Committee itself is responsible for those duties.  The Reserves
review and Finance Committees both have written mandates.  Disclosure Review is
the subject of Policy # 201 – External Communications.

8.

Receive reports, from time to time, as required, from the Chair or other
representative of any sub-committee that may be formed such as a Finance
Committee or a Reserves Review Committee and discuss with them issues of
relevance to both the Committee and each of the Finance Committee and the
Reserves Review Committee.

9.

Participate in an annual performance evaluation by the Nominating Committee, the
results of which will be reviewed by the Board.

10.

The Committee shall have the authority to engage independent counsel and other
advisors as it determines necessary to carry out its duties. The Committee shall
be entitled to adequate funding from the Corporation for such counsel and other
advisors, as determined by the Committee, and for ordinary administrative
expenses that are necessary or appropriate in carrying out its duties.

11.

Perform any other activities consistent with this Mandate, the Corporation’s
By-Laws and applicable law, as the Committee or the Board deems necessary or
appropriate.

C. Internal Control Supervision Duties

1.

Review with management the Corporation’s internal controls over financial
reporting, in accordance with regulatory requirements.

2.

Review with the Corporation’s management, Chief Audit Officer and the
independent auditors the Corporation’s internal accounting and financial
reporting controls, any significant deficiencies in them and any proposed major
changes to them.

3.

Review the performance of internal audit, the scope of internal audit’s work
plan for the year and receive a summary report of major findings by internal
audit and management’s action plan.

4.

Review with management, the Chief Financial Officer, CAO and the independent
auditors the methods used to establish and monitor the Corporation’s policies
with respect to unethical or illegal activities by Corporation employees that
may have a material impact on the financial statements.

5.

Oversee conduct review by obtaining an annual report summarizing the statements
of compliance completed by employees pursuant to the Corporate - Ethics policies
(i.e., the 500 series policies) of the Company and making such resulting
inquiries as the Committee deems necessary.

6.

Meet with management, internal audit and the independent auditors to discuss any
relevant significant recommendations that the independent auditors may have,
particularly those characterized as “material” or “serious”. Typically, such
recommendations shall be presented by the independent auditors in the form of a
Letter of Comments and Recommendations to the Committee. The Committee should
review responses of management to the Letter of Comments and Recommendations
from the independent auditors and receive follow-up reports on action taken
concerning the recommendations.

7.

Receive a report, at least annually, from the Reserves Review Committee on the
Corporation’s petroleum and natural gas reserves and on the findings of any
independent qualified consultants.

8.

Review any appointment or dismissal of the senior Audit Officer.

9.

Review with management and the independent auditor any correspondence with
regulators or governmental agencies and any employee complaints or published
reports which raise material issues regarding the Corporation’s financial
statements or accounting policies.

10.

Review with management and the independent auditor any off-balance sheet
financing mechanisms, transactions or obligations of the Corporation.

11.

Review with management and the independent auditor any related party
transactions.

12.

Establish, implement and, as necessary, revise the procedures set forth in the
Corporation’s Ethics Policy for:

(i)

the receipt, retention, and treatment of complaints received by the Corporation
regarding accounting, internal accounting and financial reporting controls, or
auditing matters;

(ii)

the confidential, anonymous submission by employees of the Corporation of
concerns regarding questionable accounting or auditing matters; and,

(iii)

addressing a reporting attorney’s report of a material breach of securities law,
material breach of fiduciary duty or similar material violation.

13.

Review with the independent auditors the quality of the Corporation’s accounting
personnel. Review with management the responsiveness of the independent auditors
to the Corporation’s needs.

14.

Receive all internal audit reports and assign responsibility for reading them to
at least one member of the Committee.

D. Regulatory Compliance Duties

1.

Prepare a letter for the annual report to shareholders and the Annual Report on
Form 10-K, disclosing whether or not, with respect to the prior fiscal year:

(i)

management has reviewed the audited financial statements with the Committee,
including a discussion of the quality of the accounting principles as applied
and significant judgments affecting the Corporation’s financial statements;

(ii)

the independent auditors have discussed with the Committee the independent
auditors’ judgments of the quality of those principles as applied and judgments
referenced in (i) above under the circumstances;

(iii)

the members of the Committee have discussed among themselves, without management
or the independent auditors present, the information disclosed to the Committee
described in (i) and (ii) above; and,

(iv)

the Committee, in reliance on the review and discussions conducted with
management and the outside auditors pursuant to (i) and (ii) above, believes
that the Corporation’s financial statements are fairly presented in conformity
with Canadian GAAP in all material respects and that the reconciliation of the
Corporation’s financial statements to U.S. GAAP complies with the requirements
of the Securities Exchange Act of 1934.

2.

Receive reports, from time to time, as required, from management, the
Corporation’s Chief Audit Officer or, to the best of their knowledge, the
independent auditor that the Corporation’s subsidiary / foreign affiliated
entities are in conformity with applicable legal requirements and the
Corporation’s Ethics Policy, including disclosures of insider and affiliated
party transactions.

3.

Review with the independent auditor any reports required to be submitted to the
Committee under Section 10A of the Securities Exchange Act of 1934 (regarding
the detection of illegal acts, the identification of related party transactions
and the evaluation of whether there is substantial doubt about the ability of
the Corporation to continue as a going concern).

4.

Prepare such reports as are required to be prepared by the Committee pursuant to
applicable securities law.

5.

Pre-approve non-audit services provided by the independent auditor.  Note that
Sarbanes-Oxley makes it unlawful for the independent auditor to perform any
consulting or accounting activities for the Company, but tax preparation is
permitted.

Adopted by the Board of Directors on June 11, 2012

By: /s/ Wayne St. Cyr

Wayne St. Cyr, Corporate Secretary