Exhibit 10.1

ASSET PURCHASE AGREEMENT

INTERNATIONAL SOVEREIGN ENERGY CORP.

(THE “VENDOR”)

AND

LEGEND OIL AND GAS LTD.

(“LEGEND”)

AND

LEGEND ENERGY CANADA LTD.

(THE “PURCHASER”)

SEPTEMBER 13, 2011

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ARTICLE 1 INTERPRETATION      1   

1.1

  Defined Terms and Interpretation      1   

1.2

  Currency      9   

1.3

  Sections and Headings      9   

1.4

  Number, Gender and Persons      9   

1.5

  Entire Agreement      10   

1.6

  Time of Essence and Computations of Time      10   

1.7

  Construction      10   

1.8

  Including      10   

1.9

  Knowledge      10   

1.10

  Severability      10   

1.11

  Applicable Law      11   

1.12

  Successors and Assigns      11   

1.13

  Amendments and Waivers      11   

1.14

  Schedules      11    ARTICLE 2 PURCHASE AND SALE OF PURCHASED ASSETS      11
  

2.1

  Purchased Assets      11   

2.2

  Excluded Assets      11    ARTICLE 3 PURCHASE PRICE AND WORKING CAPITAL
ADJUSTMENT      12   

3.1

  Purchase Price      12   

3.2

  Restricted Shares      12   

3.3

  Working Capital Adjustment      12    ARTICLE 4 PURCHASE PRICE ADJUSTMENTS   
  14   

4.1

  Purchase Price Adjustment for Drop in Production Volume      14   

4.2

  Adjustment for Drop in Share Price      15   

4.3

  Anti Dilution      16   

4.4

  Listing      16   

4.5

  Insolvency or Discontinuance      16   

4.6

  Adjustment of Working Capital Adjustments      17   

4.7

  Trust Conditions for holding of the Escrow Amount      17   

4.8

  Allocation of Purchase Price      18   

4.9

  Transfer Taxes      18    ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF THE
VENDOR      18   

5.1

  Organization      18   

5.2

  Authorization      18   

5.3

  No Alteration of Business      18   

5.4

  No Violation      18   

5.5

  Consents      19   

5.6

  Conduct of Business and Permits      19   

5.7

  Title to Purchased Assets      19   

5.8

  Significant Contracts      19   

5.9

  Books and Records      19   

5.10

  Taxes      20   

5.11

  Litigation      20   

5.12

  Consents and Approvals      20   

5.13

  Residency      20   

5.14

  GST Registration      20   

5.15

  Purchased Assets      20   

5.16

  The Shares      20   

5.17

  Environmental      21   

5.18

  Oil and Gas      21   

5.19

  Full Disclosure      24   

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5.20

  As Is Where Is      24    ARTICLE 6 REPRESENTATIONS AND WARRANTIES PERTAINING
TO LEGEND      24   

6.1

  Organization      24   

6.2

  Authorization and Reservation of Shares      24   

6.3

  No Alteration of Business      24   

6.4

  No Violation      25   

6.5

  Conduct of Business and Permits      25   

6.6

  Books and Records      25   

6.7

  Litigation      25   

6.8

  Consents and Approvals      25   

6.9

  Corporate      25   

6.10

  Securities Law      28   

6.11

  Oil and Gas      30   

6.12

  Full Disclosure      30    ARTICLE 7 REPRESENTATIONS AND WARRANTIES PERTAINING
TO THE PURCHASER      30   

7.1

  Organization      30   

7.2

  Authorization      30   

7.3

  Availability and Source Funds      30   

7.4

  Corporate      31   

7.5

  No Alteration of Business      31   

7.6

  No Violation      31   

7.7

  Conduct of Business and Permits      32   

7.8

  Residency      32   

7.9

  GST Registration      32   

7.10

  Full Disclosure      32    ARTICLE 8 SURVIVAL OF COVENANTS, REPRESENTATIONS
AND WARRANTIES      32   

8.1

  Survival of Covenants, Representations and Warranties      32    ARTICLE 9
COVENANTS      33   

9.1

  Access to Purchased Assets      33   

9.2

  Conduct of Purchased Assets Prior to Closing      33   

9.3

  Conduct of Legend’s Assets Prior to Closing      33   

9.4

  Abandonment and Reclamation      34   

9.5

  SEC Filings and Registration Rights      34   

9.6

  TSX Approval      35   

9.7

  Seismic Data (other than Vendor Proprietary Seismic Data)      35   

9.8

  Delivery of Conveyancing Documents      35   

9.9

  Delivery of Vendor’s Closing Documentation      35   

9.10

  Delivery of Purchaser’s Closing Documentation      36    ARTICLE 10 CONDITIONS
OF CLOSING      37   

10.2

  Conditions of Closing in Favour of the Vendor      38    ARTICLE 11 TITLE
DEFECTS      39   

11.1

  Deficiency Statement      39   

11.2

  Election      40   

11.3

  Arbitration      40    ARTICLE 12 CLOSING DATE AND TRANSFER OF POSSESSION     
41   

12.1

  Transfer of Possession      41   

12.2

  Place of Closing      41   

12.3

  Further Assurances      41   

12.4

  Delivery of Title and Operating Documents      41   

12.5

  Risk of Loss      41    ARTICLE 13 INDEMNIFICATION      41   

13.3

  Abandonment and Reclamation      42   

 

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13.4

  Cumulative Rights      43   

13.5

  Consequential Damages      43    ARTICLE 14 DISPUTE RESOLUTION      43   

14.1

  Arbitration Proceedings      43    ARTICLE 15 MISCELLANEOUS      43   

15.1

  Notices      43   

15.2

  Non-Transferability      44   

15.3

  Commissions, etc      45   

15.4

  Consultation      45   

15.5

  Disclosure      45   

15.6

  Confidentiality      45   

15.7

  Assignment by Purchaser      46   

15.8

  Best Efforts      46   

15.9

  Counterparts      47   

 

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT made as of the 13th day of September, 2011

AMONG:

INTERNATIONAL SOVEREIGN ENERGY CORP. a corporation existing under the laws of
Alberta, (the “Vendor”),

– and –

LEGEND OIL AND GAS LTD., a corporation existing under the laws of Colorado,
(“Legend”),

– and –

LEGEND ENERGY CANADA LTD., a corporation existing under the laws of Alberta,
(“Purchaser”),

WHEREAS the Vendor wishes to sell and transfer to the Purchaser, and the
Purchaser wishes to purchase from the Vendor, the Purchased Assets upon the
terms and conditions set forth herein,

NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the respective
covenants, agreements, representations, warranties and indemnities of the
Parties herein contained and for other good and valuable consideration (the
receipt and sufficiency of which are acknowledged by each Party), the Parties
agree as follows:

ARTICLE 1

INTERPRETATION

 

1.1 Defined Terms and Interpretation

For the purposes of this Agreement, unless otherwise expressly provided, the
following terms shall have the respective meanings specified or referred to
below and grammatical variations of such terms shall have the same corresponding
meanings:

 

  (a) “Accountant” has the meaning set out in Section 4.6;

 

  (b) “Affiliate” means, with respect to any Person, any other Person or group
of Persons acting in concert, directly or indirectly, that controls, is
controlled by, or is under common control with, such Person. The term “control”
as used in the preceding sentence means the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of a
Person, whether through ownership of more than fifty percent (50%) of the voting
securities of such Person, by contract or otherwise.;

 

  (c) “Agreement” means this Asset Purchase Agreement and all amendments thereto
made in writing by the Parties. “Hereto”, “herein” and similar expressions mean
and refer to this Agreement as a whole and not to any particular Article,
section, Section or Schedule;

 

  (d) “Applicable Law” means any statute, code, ordinance, decree, rule,
regulation, municipal by-law, judgment, order, decision, ruling or award or any
provisions or conditions of the foregoing enacted, made, granted or issued by a
Governmental Authority having jurisdiction over the Parties or the Purchased
Assets, including a rule or policy of the Toronto Stock Exchange or other
applicable stock exchange, and principles of common and civil law and equity,
binding on or affecting the Parties or the Purchased Assets;

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  (e) “August Monthly Average” has the meaning set out in Section 4.1;

 

  (f) “BOE/d” means barrels of oil equivalent per day with one barrel of oil as
a unit of energy based on the approximate energy released by burning one barrel
(42 US gallons or 158.9873 litres) of crude oil and equating to 6 Mcf of natural
gas;

 

  (g) “Business Day” means any day, other than a Saturday or a Sunday, on which
the main branches of National Bank of Canada in Calgary, Alberta are open for
business;

 

  (h) “Claim” means any claim, demand, action, suit, proceeding, arbitration,
judgement, investigation, inquiry, assessment, reassessment, in each case,
whether asserted, threatened, pending or existing;

 

  (i) “Closing Date” means the first Business Day that occurs six weeks after
the entering into of this Agreement, or such other date as may be agreed to in
writing by the Parties;

 

  (j) “Closing Shares” has the meaning given to such term in Section 9.5(c)
hereto;

 

  (k) “Closing Time” the means 12:01 a.m. on the Closing Date;

 

  (l) “Common Shares” means the authorized common stock, par value $0.001 per
share, of Legend;

 

  (m) “Contract” means any agreement, indenture, contract, lease, deed of trust,
licence, option, instrument or other commitment, whether written or oral;

 

  (n) “Effective Date” means July 1, 2011 for the purposes of adjustments or
such later date as may be agreed to by the Parties in writing;

 

  (o) “ETA” means Part IX of the Excise Tax Act (Canada), as amended from time
to time;

 

  (p) “Encumbrance” means any ownership claim, title retention claim, prior
claim, security interest (whether contractual, statutory, or otherwise),
hypothec, mortgage, encumbrance, pledge, indenture, loan agreement, judgment,
execution, agreement, benefit, exception, reservation, easement, right of
occupation, any matter capable of registration against title, privilege, rights
of pre-emption, trust or deemed trust (whether contractual, statutory, or
otherwise), lien, execution, levy, charge, registered and unregistered estate,
license, benefit, pledge, instrument, lease, assignment, right of distress,
right of setoff (whether legal, equitable or contractual), option, adverse
claim, Tax, or any other right, title, interest, limitation or claim of any kind
whatsoever, or howsoever arising or other financial or monetary claim, whether
or not it has attached or been perfected, registered or filed and whether
secured, unsecured or otherwise including (i) any encumbrances or charges
created by court order; and (ii) all charges, security interests or claims
evidenced by registrations pursuant to the Alberta Personal Property Registry,
or any other personal property registry system, or any contract to create any of
the foregoing;

 

  (q) “Environmental Laws” has the meaning set out in Section 5.17(a);

 

  (r) “Environmental Permits” has the meaning set out in Section 5.17(b);

 

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  (s) “Exchange Act” means the United States Securities Exchange Act of 1934, as
amended;

 

  (t) “Excluded Assets” has the meaning set out in Section 2.2;

 

  (u) “Form 10 information” has the meaning given to such term in Section 9.5(a)
hereunder;

 

  (v) “General Conveyance” means the general conveyance in the form attached as
Schedule 3;

 

  (w) “Governmental Authority” means any: (a) Canadian or US federal,
provincial, state regional, municipal, local or other political subdivision,
government, department, commission, bureau, agency, court, tribunal or
instrumentality; (b) any subdivision, agent, commission, board or authority of
any of the foregoing; or (c) any quasi governmental, self-regulatory or private
body or authority (including any stock exchange) exercising any regulatory,
expropriation or taxing authority under or for the account of any of the
foregoing;

 

  (x) “GST” means all taxes payable under the ETA or under any provincial
legislation similar to the ETA, and any reference to a specific provision of the
ETA or any such provincial legislation shall refer to any successor provision
thereto of like or similar effect;

 

  (y) “Initial VWAP” means the VWAP during the five (5) Trading Days immediately
preceding the last day of the Restricted Period and the five (5) Trading Days
including and immediately following the last day of the Restricted Period.

 

  (z) “Joint Venture Proprietary Seismic Data” means the proprietary seismic
data owned by the Vendor and third parties and which relates to those seismic
lines within the Lands or any lands pooled or unitized therewith;

 

  (aa) “Lands” means all of the lands described in the attached Schedule 1 in
which the Vendor holds any royalty or working interest, including any lands with
which the Lands may be pooled or unitized, and includes the Petroleum Substances
within, upon or under those Lands together with the right to explore for and
recover Petroleum Substances to the extent those rights are granted by Leases;

 

  (bb) “Leased Substances” means all Petroleum Substances, rights to or in
respect of which are granted, reserved, or otherwise conferred by or under the
Leases, or by or under the Title and Operating Documents (but only to the extent
that the Leases and Title and Operating Documents pertain to the Lands);

 

  (cc) “Leases” means the leases, reservations, permits, licenses or other
documents of title described in Schedule 1 attributable to the Lands (or lands
with which the Lands are pooled or unitized) in which the Vendor holds any
interest and any document of title issued in substitution for, amendment of or
in addition to any of them;

 

  (dd) “Legend Disclosure Letter” means a letter duly executed by each of Legend
and the Purchaser addressed to the Vendor dated the date of this Agreement, and
acknowledged by the Vendor, providing disclosure of certain information;

 

  (ee) “Legend Financial Statements” means Legend’s audited financial statements
for the year ended December 31, 2010 and the quarterly financial statements for
the quarter ended March 31, 2011;

 

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  (ff) “Legend SEC Documents” has the meaning set out in Section 6.10(a)

 

  (gg) “Legend’s Assets” means all of the lands outlined in the Legend
Disclosure Letter in which Legend holds any royalty or working interest,
including any lands with which such lands may be pooled or unitized, and
includes the petroleum substances within, upon or under such lands, together
with the right to explore for and recover petroleum substances to the extent
those rights are granted by leases;

 

  (hh) “Lock-Up Agreement” means the letter agreement in the form attached as
Schedule 5;

 

  (ii) “Losses and Liabilities” means in respect of a Party and in relation to
any matter, any and all:

 

  (i) losses, damages, costs, expenses and charges (including penalties,
assessments and fines) which such Person suffers, sustains, pays or incurs in
connection with such matter, all reasonable costs of legal counsel (on a full
indemnity basis) and other professional advisors, consultants and reasonable
costs of investigating and defending Claims arising from the matter, regardless
of whether such Claims are sustained, settled or resolved in respect of such
matter; and

 

  (ii) liabilities and obligations, whether under common law, in equity, under
Applicable Law or otherwise, whether tortious, contractual, vicarious, statutory
or otherwise, whether absolute or contingent and whether based on fault, strict
liability or otherwise, which a Party incurs as a result of such matter or in
connection therewith;

excluding indirect, incidental, special, aggravated, consequential, exemplary,
special or punitive damages or loss of profits;

 

  (jj) “Marwayne Assets” shall mean the Vendor’s right title and interest in the
wellbores and mineral rights described in Schedule 4.

 

  (kk) “Material Adverse Effect” means any change or effect that, individually
or in the aggregate, would reasonably be expected to (1) be materially adverse
to the business, operations, properties, condition (financial or otherwise),
assets or liabilities (including contingent liabilities) of the Party or
(2) prevent or materially delay the consummation of the transactions
contemplated by this Agreement. “Material Adverse Effect,” however, does not
include any of the following:

 

  (i) any changes or effects, individually or in the aggregate, generally
affecting the international or national petroleum exploration, production, sale
or delivery industry as a whole;

 

  (ii) any changes or effects, individually or in the aggregate, generally
affecting the international or national wholesale or retail markets for
petroleum products; or

 

  (iii) any changes or effects, individually or in the aggregate, resulting from
changes in the general national economic or financial conditions,

unless the changes or effects described in clauses (i) through (iii),
individually or in the aggregate, disproportionately affect the Party.

 

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  (ll) “Miscellaneous Interests” means, subject to any and all limitations and
exclusions provided for in this definition, the entire right, title and interest
of the Vendor in and to all property, assets, interests and rights pertaining to
the Petroleum and Natural Gas Rights and the Tangibles, or either of them (other
than the Petroleum and Natural Gas Rights, the Tangibles and the Excluded
Assets) but only to the extent that such right, title and interests pertain to
the Petroleum and Natural Gas Rights and the Tangibles, or either of them,
including without limitation, any and all of the foregoing:

 

  (i) contracts and agreements relating to the Petroleum and Natural Gas Rights
and Tangibles, or either of them;

 

  (ii) all subsisting leasehold rights to, and rights to enter upon, use or
occupy the surface of any lands which are or may be used to gain access to or
otherwise use the Petroleum and Natural Gas Rights and the Tangibles, or either
of them, excluding any such rights that pertain only to a well or wells, other
than the Wells (the “Surface Rights”);

 

  (iii) Permits which relate to the Purchased Assets;

 

  (iv) all records, books, documents, files, reports, and data, which relate to
the Petroleum and Natural Gas Rights, including all non-interpretative
engineering, geological and production information (be it files, reports, data,
correspondence or documents);

 

  (v) the Wells, including the wellbores and any and all casing; and

 

  (vi)the Vendor Proprietary Seismic Data

 

  (mm) “Parties” means the Vendor and the Purchaser;

 

  (nn) “Per Barrel Value” means that each barrel of oil equivalent shall have a
value of fifty six thousand, six hundred and sixty seven dollars ($56,667) for
the purposes of Section 4.1;

 

  (oo) “Permits” means all licences, permits, approvals and authorizations
granted or issued by any Governmental Authority and related to the construction,
installation, ownership, use or operations of the Purchased Assets or the Legend
Assets, as applicable;

 

  (pp) “Permitted Encumbrances” means:

 

  (i) easements, rights of way, servitudes and other similar rights in land
(including rights of way and servitudes for highways and other roads, railways,
sewers, drains, gas and oil pipelines, gas and water mains, electric light,
power, telephone, telegraph or cable television conduits, poles, towers, wires
and cables) which do not materially impair the current or contemplated use of
the Purchased Assets affected thereby;

 

  (ii) the rights reserved to or vested in any Governmental Authority by the
terms of any Purchased Assets, lease, licence, franchise, grant or Permit or by
any statutory provision, to terminate any such Purchased Asset, lease, licence,
franchise, grant, Permit or authorization or to require annual or other periodic
payments as a condition of the continuance thereof;

 

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  (iii) rights of general application reserved to or vested in any Governmental
Authority to levy taxes on Petroleum Substances produced from any of the Lands
or the revenue therefrom;

 

  (iv) requirements imposed under any Applicable Laws concerning manner, timing
and rates of production from operations in respect of any of the Purchased
Assets and which are generally applicable to the oil and gas industry, including
any order or directive of any Governmental Authority to limit or shut-in
production from the Assets;

 

  (v) the terms and conditions of the Title and Operating Documents;

 

  (vi) liens or security incurred, created or granted in the ordinary course of
business or imposed by Applicable Law, to a public utility or Governmental
Authority in connection with the Purchased Assets or operations thereon for the
payment of taxes, assessments and governmental charges which are not due at
Closing, or the validity of which is being diligently contested in good faith by
or on behalf of the Vendor, and for which it will retain responsibility, as
disclosed in the Vendor Disclosure Letter;

 

  (vii) liens (including, processors’, operators’ and similar liens) incurred or
created in the ordinary course of business as security in favour of the Person
conducting the development or operation of the Purchased Assets for the Vendor’s
proportionate share of the costs and expenses of such development or operation
which are not due at Time of Closing, or the validity of which is being
diligently contested in good faith by or on behalf of the Vendor, and for which
it will retain responsibility, as disclosed in the Vendor Disclosure Letter;

 

  (viii) mechanics’, builders’ or materialmen’s liens in respect of services
rendered or goods supplied, but only insofar as such liens relate to goods or
services for which payment is not due at Time of Closing or the validity of
which is being diligently contested in good faith by or on behalf of the Vendor,
and for which it will retain responsibility, as disclosed in the Vendor
Disclosure Letter;

 

  (ix) statutory exceptions to title, and the reservations, limitations,
provisos and conditions in any original grants of any of the Purchased Assets or
interests therein; and

 

  (x) the Encumbrances described in the Vendor Disclosure Letter;

 

  (qq) “Person” is to be broadly interpreted and includes an individual, a
corporation, a partnership, a joint venture, a trust, an association, an
unincorporated organization, a Governmental Authority, an executor or
administrator or other legal or personal representative, or any other juridical
entity;

 

  (rr) “Petroleum and Natural Gas Rights” means all of the Vendor’s rights,
title and interest to and in respect of the Leases, the Leased Substances and
the Title and Operating Documents, but expressly excluding the Excluded Assets.

 

  (ss) “Petroleum Substances” means petroleum, natural gas and related
hydrocarbons including crude oil, oilsands, crude bitumen and products derived
therefrom, synthetic crude oil natural gas derived from or associated with
petroleum products and all other substances, whether liquid or solid or gaseous
and whether hydrocarbons or not, insofar as granted by the Leases;

 

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  (tt) “Protection Period” means the periods of time, as set out in Section 4.2,
during which time the Shares portion of the Purchase Price paid to the Vendor is
to be protected for the benefit of the Vendor and as determined pursuant to
Section 4.2;

 

  (uu) “Purchase Price” has the meaning set out in Section 3.1;

 

  (vv) “Purchased Assets” means the Petroleum and Natural Gas Rights, the
Tangibles and the Miscellaneous Interests;

 

  (ww) “Purchaser’s Counsel” means Macleod Dixon LLP;

 

  (xx) “Purchaser/Legend Indemnified Parties” means Purchaser and its
Affiliates, and their respective directors, officers, employees and agents; and
Legend and its Affiliates and their respective directors, officers, employees
and agents;

 

  (yy) “Resale Registration Statement” has the meaning given to such term in
Section 9.5(c) hereunder;

 

  (zz) “Restricted Period” means the period beginning on the Closing Date and
ending on the later of (i) the period established in the Lock-Up Agreement and
(ii) the date on which, pursuant to Section 9.5(c) hereunder, Legend is no
longer required to maintain the effectiveness of the Resale Registration
Statement under the Securities Act;

 

  (aaa) “Returns” means all reports, estimates, elections, designations, forms,
declarations of estimated tax, information statements and returns relating to,
or required to be filed in connection with, any Taxes;

 

  (bbb) “Securities Act” means the United States Securities Act of 1933 as
amended;

 

  (ccc) “SEC” means the United States Securities and Exchange Commission;

 

  (ddd) “Second VWAP” means the VWAP during the ten (10) Trading Days
immediately following the last day of the period during which the Initial VWAP
is calculated;

 

  (eee) “Share Price” means the closing price of a Common Share as quoted on the
exchange that the Common Shares are trading on;

 

  (fff) “Shares” means the Common Shares being issued to Vendor pursuant to
Section 3.1(b) and any subsequent Common Shares issuable to the Vendor in
connection with this Agreement;

 

  (ggg) “Specific Conveyances” all necessary deeds, conveyances, bills of sale,
assurances, registerable transfers, novation agreements, specific assignments,
trust agreements and any other documentation reasonably required to transfer the
Purchased Assets to the Purchaser and to novate the Purchaser into the Title and
Operating Documents and the documents described in Section 1.1(ll)(i);

 

  (hhh) “Super 8-K” has the meaning given to such term in Section 9.5(a) hereto;

 

  (iii) “Surface Rights” has the meaning given to that term in
Section 1.1(ll)(ii);

 

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  (jjj) “Tangibles” means all of the Vendor’s right, title and interest in and
to the facilities set out in Schedule 2, and any and all tangible depreciable
property and assets other than such facilities, which are located within, upon
or in the vicinity of the Lands (or any lands pooled or unitized therewith) and
which are used or intended to be used to produce, process, gather, treat,
measure, make marketable or inject the Leased Substances or any of them or in
connection with water injection or removal operations that pertain to the
Petroleum and Natural Gas Rights, including any and all gas plants, oil
batteries, buildings, production equipment, pipelines, pipeline connections,
meters, generators, motors, compressors, treaters, dehydrators, scrubbers,
separators, pumps, tanks, boilers and communication equipment, as well as
inventory and spare parts related thereto;

 

  (kkk) “Tax” or “Taxes” means any federal, provincial, local, foreign or other
income, gross receipts, profits, franchise, transfer, sales, use, customs,
payroll, occupation, health, property, excise, GST, or other taxes, fees,
duties, assessments, withholdings or governmental charges of any nature
(including interest, penalties and additions to such taxes or charges);

 

  (lll) “Tax Act” means the Income Tax Act (Canada), as amended from time to
time;

 

  (mmm) “Third VWAP” means the VWAP during the ten (10) Trading Days immediately
following the last day during which the Second VWAP is calculated;

 

  (nnn) “Thirteenth Month Adjustment” means the reconciliation adjustment
performed annually by an operator of particular Purchased Assets for the purpose
of reconciling estimates of certain revenues and expenses, including operating
expenses, processing fee revenues, excess capacity utilization fees and
recoveries, royalties and gas cost allowance (or similar cost allowance)
prepared during a calendar year with the actual amounts of such revenues and
costs prepared following the end of such calendar year;

 

  (ooo) “Threshold Losses” has the meaning set out in Section 13.1;

 

  (ppp) “Threshold Production” means a production and sale of Leased Substances
from or in relation to the Purchased Assets equivalent to 300 BOE/d;

 

  (qqq) “Time of Closing” means 12:00 pm on the Closing Date in the city of
Calgary, Alberta;

 

  (rrr) “Title and Operating Documents” means collectively, any and all
certificates of title, leases, reservations, permits, licenses, assignments,
trust declarations, operating agreement, royalty agreements, gross overriding
royalty agreements, participation agreements, farm-in agreements, sale and
purchase agreements, pooling agreements and any other documents and agreements
granting, reserving or otherwise conferring rights to (i) explore for, drill
for, produce, take, use or market Petroleum Substances, (ii) share in the
production of Petroleum Substances, (iii) share in the proceeds from, or
measured or calculated by reference to the value or quantity of, Petroleum
Substances which are produced, and (iv) rights to acquire any of the rights
described in items (i) to (iii) of this definition; but only if the foregoing
pertain in whole or in part to the Petroleum Substances within, upon or under
the Lands;

 

  (sss) “Title Defect” means a defect, in or affecting the title of the Vendor
in and to any of the Purchased Assets, other than a Permitted Encumbrance, which
is sufficiently material and adverse to the enforcement of title that it would
not be acceptable to a knowledgeable, prudent purchaser buying similar oil and
gas properties, acting reasonably;

 

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  (ttt) “Trade Seismic Data” means the seismic data relating to any seismic
lines within the Lands or any lands pooled or unitized therewith owned by a
third party and currently licensed to the Vendor;

 

  (uuu) “Trading Day” means any day on which a minimum of 75,000 Common Shares
trade on the applicable exchange or bulletin board being used to calculate a
VWAP;

 

  (vvv) “Vendor Disclosure Letter” means a letter duly executed by the Vendor
addressed to the Purchaser and Legend dated the date of this Agreement, and
acknowledged by the Purchaser and Legend, providing disclosure of certain
information;

 

  (www) “Vendor Financial Statements” means the Vendor’s audited financial
statement for the year ending December 31, 2010 and the quarterly financial
statement for the quarter ending March 31, 2011;

 

  (xxx) “Vendor Indemnified Parties” means Vendor and its Affiliates, and their
respective directors, officers, employees and agents;

 

  (yyy) “Vendor Proprietary Seismic Data” means the proprietary seismic data
exclusively owned by the Vendor and which relates to those seismic lines within
the Lands or any lands pooled or unitized therewith as described in the Vendor
Disclosure Letter;

 

  (zzz) “Vendor Significant Contracts” has the meaning set out in Section 5.8;

 

  (aaaa) “VWAP” means the volume weighted average trading price of the Common
Shares on the exchange or bulletin board where the majority of the trading
volume and value of the Common Shares occurs, calculated by dividing the total
value by the total volume of securities traded for the relevant period;

 

  (bbbb) “Wells” means all producing, shut-in, suspended, water source or
injection wells insofar as they relate to the Lands and all well casings
therein, including all facilities which service such wells, including those
identified in the Vendor Disclosure Letter; and

 

  (cccc) “Working Capital Schedule” has the meaning set out in Section 3.3.

 

1.2 Currency

Unless otherwise indicated, all dollar amounts in this Agreement are expressed
in Canadian funds.

 

1.3 Sections and Headings

The division of this Agreement into Articles, Sections and Subsections and the
insertion of headings are for convenience of reference only and shall not affect
the interpretation of this Agreement. Unless otherwise indicated, any reference
in this Agreement to an Article, section, Section or Schedule refers to the
specified Article, Section or Subsection of or Schedule to this Agreement.

 

1.4 Number, Gender and Persons

In this Agreement, words importing the singular number only shall include the
plural and vice versa, words importing gender shall include all genders and
words importing persons shall have the same meanings as Persons.

 

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1.5 Entire Agreement

This Agreement constitutes the entire agreement between the Parties with respect
to the subject matter hereof and supersedes all prior agreements,
understandings, negotiations and discussions, whether written or oral. There are
no conditions, covenants, agreements, representations, warranties or other
provisions, express or implied, collateral, statutory or otherwise, relating to
the subject matter hereof except as herein provided.

 

1.6 Time of Essence and Computations of Time

Time shall be of the essence of this Agreement. In this Agreement, unless
specified otherwise or the context otherwise requires:

 

  (a) a reference to a period of days is deemed to begin on the first day after
the event that started the period and to end at 11:59 p.m. on the last day of
the period, but if the last day of the period does not fall on a Business Day,
the period ends at 11:59 p.m. on the next Business Day;

 

  (b) all references to specific dates mean 11:59 p.m. on the dates;

 

  (c) all references to specific times shall be references to Calgary, Alberta,
Canada time; and

 

  (d) with respect to the calculation of any period of time, references to
“from” mean “from and excluding” and references to “to” or “until” mean “to and
including”.

 

1.7 Construction

The Parties agree that each Party and its counsel have reviewed and revised this
Agreement and that the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting Party shall not be employed
in the interpretation of this Agreement or any amendments, schedules or exhibits
thereto.

 

1.8 Including

Where the words “include”, “includes” or “including” are used herein they are to
be construed as though followed by the words “without limitation”, and shall not
be considered to set forth an exhaustive list.

 

1.9 Knowledge

The knowledge or awareness of either Party consists of the actual knowledge or
awareness of its current officers and employees who are primarily responsible
for the matter in question in the course of their normal duties (other than
those employees employed in the field who do not have management
responsibilities), after reasonable inquiry of that Party’s applicable files and
records. Knowledge and awareness does not include the knowledge of any third
party or constructive knowledge. The Parties do not have any obligation to make
inquiry of third parties or the files or records of any third party or public
authority in connection with representations and warranties that are made to its
knowledge, information and belief.

 

1.10 Severability

Any Article, Section or Subsection or any other provision of this Agreement
which is, is deemed to be, or becomes void, illegal, invalid or unenforceable
shall be severable herefrom and ineffective to the extent of such voidability,
illegality, invalidity or unenforceability, and shall not invalidate, affect or
impair the remaining provisions hereof, which provisions shall be severable from
any void, illegal, invalid or unenforceable article, section or other
subdivision or provision.

 

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1.11 Applicable Law

This Agreement shall be construed, interpreted and enforced in accordance with,
and the respective rights and obligations of the Parties shall be governed by,
the laws of the Province of Alberta and the federal laws of Canada applicable
therein, and each Party irrevocably and unconditionally submits to the
non-exclusive jurisdiction of the courts of such province and all courts
competent to hear appeals therefrom except as may be otherwise agreed to in
writing by the Parties.

 

1.12 Successors and Assigns

This Agreement shall enure to the benefit of and shall be binding on and
enforceable by the Parties and their respective successors and permitted
assigns.

 

1.13 Amendments and Waivers

No amendment or waiver of any provision of this Agreement shall be binding on a
Party unless consented to in writing by such Party. No waiver of any provision
of this Agreement shall constitute a waiver of any other provision, nor shall
any waiver constitute a continuing waiver unless otherwise provided.

 

1.14 Schedules

The following Schedules are attached to and form a part of this Agreement:

 

Schedule 1

   Lands, Leases, Leased Substances and Production Encumbrances

Schedule 2

   Tangibles

Schedule 3

   General Conveyance

Schedule 4

   Marwayne Assets Description

Schedule 5

   Lock-Up Agreement

ARTICLE 2

PURCHASE AND SALE OF PURCHASED ASSETS

 

2.1 Purchased Assets

Subject to the provisions of this Agreement, the Vendor agrees to sell, assign
and transfer to the Purchaser, and the Purchaser agrees to purchase from the
Vendor, effective as of the Closing Date, all of the Purchased Assets (other
than the Excluded Assets), free and clear of all liens, charges and
Encumbrances, adverse claims, demands and royalties created by or through the
Vendor, other than the Permitted Encumbrances.

 

2.2 Excluded Assets

The Purchased Assets shall not include any of the following property and assets
(collectively, the “Excluded Assets”):

 

  (a) the Marwayne Assets;

 

  (b) the Trade Seismic Data;

 

  (c) Cash. All cash on hand or in a bank and marketable securities; and

 

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  (d) Income Taxes. All income tax instalments paid by the Vendor and the right
to receive any refund of income taxes paid by the Vendor.

ARTICLE 3

PURCHASE PRICE AND WORKING CAPITAL ADJUSTMENT

 

3.1 Purchase Price

The purchase price (“the Purchase Price”) shall be:

 

  (a) Nine million five hundred thousand dollars (CDN $9,500,000.00) payable by
certified cheque, lawyer’s trust account cheque, wire transfer or bank draft on
the Closing Date; and

 

  (b) Three million seven hundred and fifty thousand (3,750,000) Common Shares
at a deemed value of US$2.00 per share.

 

3.2 Restricted Shares

The Parties hereto acknowledge that the Shares have not been and will not be
registered under the Securities Act, and will be issued to the Vendor in
transactions exempt from, or not subject to, the registration requirements of
the Securities Act and any applicable state securities laws. The Vendor
understands and acknowledges that all Shares issuable hereunder will be, upon
the original issuance thereof, “restricted securities” within the meaning of
such term in Rule 144 promulgated under the Securities Act, and therefore may
not be offered or sold by the Vendor, directly or indirectly, except in
transactions exempt from, or not subject to, the registration requirements of
the Securities Act and all applicable state securities laws. The Vendor
understands and acknowledges that all certificates representing the Shares
issuable hereunder shall bear, for so long as required by the Securities Act or
any applicable state securities laws, a legend to such effect.

 

3.3 Working Capital Adjustment

 

  (a) No later than five (5) Business Days prior to the Time of Closing, the
Vendor will provide a schedule (the “Working Capital Schedule”) to show the
difference between (i) the net of any revenues receivable by the Vendor prior to
the Effective Date and any expenditures (including cash or cash equivalents)
actually paid by the Vendor in connection with the Purchased Assets after the
Effective Date; (ii) the net of any outstanding amounts payable by Vendor
attributable to the Purchased Assets prior to the Effective Date and revenues
received by the Vendor after the Effective Date; such difference expressed as
either a positive or negative amount as applicable. The Vendor or Purchaser
shall pay such working capital adjustment, as applicable, which amount shall be
paid on the Closing Date.

 

  (b) No later than forty-five (45) days after the Time of Closing, the Vendor
will provide an updated Working Capital Schedule to show the difference between
any (i) the net of any revenues receivable by the Vendor prior to the Effective
Date and expenditures (including cash or cash equivalents) actually paid by the
Vendor in connection with the Purchased Assets after the Effective Date; and
(ii) the net of any outstanding amounts payable attribute to the Purchased
Assets prior to the Effective Date and any revenues received by the Vendor after
the Effective Date, expressed as either a positive or negative amount as
applicable. The Vendor or the Purchaser shall pay such second working capital
adjustment as applicable, which amount shall be paid within five (5) Business
Days of the Purchaser receiving the updated Working Capital Schedule.

 

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  (c) Additional Adjustments:

 

  (i) Notwithstanding the preceding subsection, each Party shall have the right,
during the sixty (60) days following the distribution of the updated Working
Capital Schedule provided in Section 3.3(b), to examine, copy and audit the
records of the other relative to the Purchased Assets for the purpose of
effecting or verifying adjustments required under this Section 3.3. The auditing
Party will, upon reasonable notice, conduct that audit at its sole expense
during normal business hours at the offices of the audited Party or at such
other premises where those records are maintained. Any claims of discrepancies
disclosed by that audit will be made in writing to the audited Party within 30
days following the completion of that audit. That Party will respond in writing
to any such claims within 30 days of the receipt of notice of those claims. The
Parties will resolve any disputes relating to adjustments required under this
Section 3.3 pursuant to Section 4.6;

 

  (ii) Notwithstanding 3.3(c)(i), further adjustments to the Working Capital
Schedule will be made as and when those items arise if the need for that
adjustment arises from:

 

  i. a Thirteenth Month Adjustment, operator error adjustments or errors
established by joint venture audits; or

 

  ii. errors established by an audit or other review of lessor royalty payments
that is conducted under Applicable Law or Leases within six (6) months after the
Closing Time or such later time as may be prescribed by the Regulations.

 

  (d) Calculating the Working Capital Schedule: The Parties will prepare the
Working Capital Schedule and make the resulting adjustments and apportionment on
an accrual basis as of the Effective Date using generally accepted accounting
principles on the following principles:

 

  (i) the Vendor is entitled to the revenues and benefits from the Purchased
Assets accrued prior to the Effective Date and is responsible for and will pay
for the expenditures pertaining to the ownership, operation and development of
the Purchased Assets incurred prior to the Effective Date;

 

  (ii) the Purchaser is entitled to the revenues and benefits from the ownership
and operation of the Purchased Assets accrued from and after the Effective Date
and is responsible for and will pay for the expenditures pertaining to the
ownership, operation and development of the Purchased Assets incurred from and
after the Effective Date;

 

  (iii) all costs incurred in connection with work performed or goods and
services provided in respect of the Purchased Assets will be deemed to have
accrued as of the date the work was performed or the goods or services provided,
regardless of the time those costs became payable;

 

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  (iv) all Petroleum Substances produced prior to the Effective Date, but not
delivered to the purchaser of those Petroleum Substances, including Petroleum
Substances in storage, will not comprise part of the Purchased Assets;

 

  (v) there will be no adjustments for royalty tax credits or similar incentives
that accrue to a Party because of financial or organizational attributes
specific to it, other than gas cost allowances (or similar cost allowances); and

 

  (vi) all freehold mineral taxes, surface and mineral lease rentals and any
similar payments made by the Vendor to preserve any of the Leases or any surface
rights shall be apportioned between the Vendor and the Purchaser on a per diem
basis as of the Effective Date.

 

  (e) The Purchaser shall report all net revenue and pay all income tax on the
net revenue from the Effective Date.

ARTICLE 4

PURCHASE PRICE ADJUSTMENTS

 

4.1 Purchase Price Adjustment for Drop in Production Volume

 

  (a) “August Monthly Average” means the daily production sales volume relating
to the Purchased Assets on average during the full month of August, 2011.

 

  (b) Should the August Monthly Average be daily production sales volumes which
is below the Threshold Production, the Purchaser shall be entitled to a pro-rata
price adjustment of the Purchase Price for each BOE/d that the August Monthly
Average is below the Threshold Production as follows:

Each barrel of oil equivalent by which the August Monthly Average is below the
Threshold Production shall be valued at the Per Barrel Value, and the Purchase
Price will be reduced, by the Per Barrel Value, for each barrel of oil
equivalent by which the August Monthly Average is below the Threshold
Production, in an equal amount of cash and Common Shares valued at US$2.00 per
Share.

 

  (c) No later than five (5) Business Days prior to the Time of Closing, the
Vendor shall deliver to the Purchaser a written estimate of the August Monthly
Average which shall be based on available field calculations and sales estimates
(the “Estimate August Monthly Average”), and the Vendor will make available to
representatives of the Purchaser all information necessary for the Purchaser to
confirm the estimate.

 

  (d) Should the Estimate August Monthly Average be below the Threshold
Production, the Purchaser shall pay to the Purchaser’s counsel, under trust
conditions, the portion of the Purchase Price (comprised of an equal amount of
cash and Common Shares valued at US$2.00 per Share) that is equivalent to the
Per Barrel Value for each barrel of oil equivalent by which the Estimate August
Monthly Average is below the Threshold Production (the “Escrow Amount”).

 

  (e) By November 30, 2011, the Purchaser shall provide notice to the Vendor of
the August Monthly Average, based on field calculations and sales (the “Actual
August Monthly Average”), and whether this is less, more or the same as the
Estimate August Monthly

 

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  Average. In the event the Actual August Monthly Average exceeds the Estimate
August Monthly Average, the Per Barrel Value of such difference shall be
released from the Escrow Amount to the Vendor in equal amounts of cash and
Common Shares valued at US$2.00, and any Escrow Amount remaining after such
release shall be returned to the Purchaser. The Purchaser shall instruct the
Purchaser’s Counsel to hold and to release the Escrow Amount, to the Purchaser
or Vendor in accordance with Section 4.1(b).

 

4.2 Adjustment for Drop in Share Price

The following mechanism will be employed to ensure that the Shares portion of
the Purchase Price is protected for the benefit of the Vendor during the
Protection Period:

 

  (a) If the Initial VWAP is below US$2.00 Legend shall issue a number of
additional Common Shares to the Vendor that is equal to (US$7,500,000 / Initial
VWAP) – 3,750,000. Legend and the Purchaser shall have five (5) Business Days
following the last day of the period during which the Initial VWAP is calculated
to deliver the additional share certificates.

 

  (b) If the Second VWAP is below the Initial VWAP, Legend shall issue a number
of additional Common Shares to the Vendor that is equal to (US$7,500,000 /
Second VWAP) – 3,750,000 - # of shares issued under paragraph (a) if applicable.
Legend and the Purchaser shall have five (5) Business Days following the last
day of the period during which the Second VWAP is calculated to deliver the
additional share certificates.

 

  (c) If the Third VWAP is below the lower of the Initial VWAP and the Second
VWAP at the end of period used to calculated the Third VWAP, Legend shall issue
a number of additional Common Shares to the Vendor that is equal to
(US$7,500,000 / Third VWAP) – 3,750,000 - # of shares issued under paragraphs
(a) and (b) if applicable. Legend and the Purchaser shall have five (5) Business
Days following the last day of the period during which the Third VWAP is
calculated to deliver the additional share certificates.

 

  (d) If, on any day during the ten (10) Business Day period immediately
following the last day of the period during which the Third VWAP is calculated,
the VWAP for the ten (10) Trading Days prior is less than US$1.00, two
additional VWAP’s (the first based on the ten (10) Trading Days immediately
following the last day of the period during which the Third VWAP is calculated)
shall be calculated in the manner set forth above, and additional Common Shares
shall be issued to the Vendor in the same manner as above.

 

  (e) Notwithstanding the foregoing, with respect to any provision hereunder
that would require the issuance of a number of Shares to the Vendor that would
result in the Vendor becoming a “ten percent beneficial owner” (as such term is
defined in Rule 16a-2 under the Exchange Act) for purposes of the reporting
requirements of Section 16 of the Exchange Act and the rules adopted by the SEC
thereunder, Legend shall issue to the Vendor only the maximum number of Shares
that may be issued to the Vendor without causing the Vendor to become,
immediately upon such issuance, a “ten percent beneficial owner” of the Common
Shares; provided, however, that the Vendor may, in its sole discretion, elect to
waive this provision, in which case Legend shall issue to the Vendor all Shares
that would otherwise be required hereunder to be issued to the Vendor.

 

  (f) Notwithstanding the foregoing, if at any time the Vendor sells any Common
Shares at a price below the most recent VWAP calculated in accordance with this
Section 4.2, the Purchaser shall have no further obligations under this
Section 4.2, other than the issuance of any Common Shares already required to be
issued at the time of the applicable sale of Common Shares by the Vendor.

 

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4.3 Anti Dilution

Except for the issuances of Common Shares in connection with the exercise of
any, or all, of the warrants described in Section 6.9(a), if at any time during
the period that commences on the Closing Date and ends two (2) months after the
last day of the Restricted Period, Legend sells any additional Common Shares to
a third party, either for cash or as part of an acquisition, for less than
US$2.00 per Common Share, Legend shall issue additional Common Shares to the
Vendor so that the Vendor has the equivalent of seven million, five hundred
thousand dollars (US$7,500,000) in Common Shares based on the per share price of
the additional Common Shares issued to a third party. Any such additional Common
Shares issued to the Vendor shall be subject to the terms and conditions
contained in this Agreement with respect to the Shares.

 

4.4 Listing

Subject to the Lock-Up Agreement, the Vendor may put any or all of the Shares to
Legend for redemption if Legend is not listed for trading or otherwise quoted on
the NYSE Amex, NASDAQ, or any other market more senior than the OTCBB (a “Senior
Listing”) on or before March 31, 2012 (the “Put Commencement Date”). The
redemption price is $2.00 per share payable in cash. This right is exercisable
by the Vendor at any time after the Put Commencement Date and may be waived by
the Vendor in whole or in part.

 

4.5 Insolvency or Discontinuance

Effective immediately upon closing, the Purchaser shall be deemed to have
granted the Vendor an irrevocable option (the “Option”), exercisable by notice
in writing from the Vendor to the Purchaser at any time between the period
commencing on the Closing Time and ending two (2) months following the last day
of the Restricted Period (the “Option Period”), to purchase back a portion of
the Purchased Assets comprising, as of the date of the exercise of the Option, a
value equivalent to $2.00 multiplied by the number of Closing Shares held by the
Vendor at that time, the Purchased Assets to be so repurchased to be chosen at
the sole discretion of the Vendor, the sole consideration for such purchase to
be the Vendor’s Closing Shares, which for the purposes of such purchase are to
have deemed value of $2.00 per share, provided that the Option shall only be
exercisable during the Option Period and only if, during the Option Period any
of the following events shall occur:

 

  (a) Legend or the Purchaser, except in the case of a merger of the Purchaser
with and into Legend or an Affiliate of Legend, become insolvent or discontinue
or seek to discontinue their operations,

 

  (b) Legend or the Purchaser fail to perform or observe any obligation,
covenant, term, provision or condition contained in this Agreement or any other
agreement made with the Vendor or any other person, firm or corporation, whereby
such failure has, or could reasonably have a Material Adverse Effect on the
Vendor;

 

  (c) Legend or the Purchaser suffer or permit any encumbrance or security
interest affecting the Purchased Assets to become enforceable;

 

  (d) Legend or the Purchaser cease or threaten to cease to carry on business;

 

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  (e) there is any change which has a Material Adverse Effect on the Purchaser’s
or Legend’s position (financial or otherwise); or

 

  (f) the Vendor considers or deems, in its sole opinion (and supported an
analyst opinion) that the Closing Shares are, or may become, substantially
devalued, provided that such opinions are not premised upon the occurrence, or
anticipated occurrence, of any of the changes or effects described in clauses
1.1(kk)(i), 1.1(kk)(ii), or 1.1(kk)(iii), unless the changes or effects
described in such clauses individually or in the aggregate, disproportionately
affect Legend.

To secure satisfaction and performance of this obligation, the Purchaser hereby
grants to the Vendor a general security interest in all present and after
acquired real and personal property of the Purchaser of whatever kind and
wherever situate, including, without limiting the generality of the foregoing,
the Purchased Assets, and the Parties shall execute a form of general security
agreement satisfactory to Vendor, acting reasonably, to evidence this security
interest. Notwithstanding the foregoing, the Vendor agrees that such general
security interest shall be subordinate and secondary to a security interest
granted by Legend and/or the Purchaser in connection with the secured lending
arrangement with National Bank of Canada entered into by Legend and/or the
Purchaser in connection with the transaction contemplated in this Agreement as
approved by the Vendor.

The Parties will, without further consideration, carry out such further actions
and deliver all further assurances, deeds, and documents, including a general
security agreement, as shall be reasonably required in order to fully perform
and carry out the terms of this Section.

 

4.6 Adjustment of Working Capital Adjustments

In the event of a disagreement between the Vendor and the Purchaser as to the
working capital adjustments contemplated by Section 3.3, the Parties shall use
their reasonable efforts to resolve such disagreement within fifteen (15) days
of the date at which the adjustment was to be made. If the matter cannot be so
resolved, then either Party may, upon written notice to the other Party, set out
in reasonable detail the basis for the disagreement following which the dispute
will be referred for determination to a senior audit partner of a firm of
chartered accountants agreed to by the Vendor and the Purchaser (or failing such
agreement, a senior audit partner named by a Justice of the Court of Queen’s
Bench in the Province of Alberta) that is independent of both Parties and the
principal shareholders of both Parties, who was not at any time the auditor or
accountant of the Vendor or the Purchaser, as chosen by the managing partner of
such firm (the “Accountant”). The Accountant shall make a determination of the
disputed entries or disputed matters within thirty (30) Business Days of
acceptance by the Accountant of such referral, which determination shall be
final and binding upon the Parties and which determination shall be used to
adjust the adjustment. One half of the costs of the Accountant shall be paid by
each of the Vendor and the Purchaser but each of the Vendor and Purchaser shall
otherwise bear its own costs incurred in respect of the dispute. If no objection
to the adjustment is given by one Party to the other within fifteen (15) days of
the date of the adjustment, the adjustment shall be deemed to have been approved
as of the last day of such fifteen (15) day period.

 

4.7 Trust Conditions for holding of the Escrow Amount

The Parties agree that the Purchaser’s Counsel shall hold the Escrow Amount, if
applicable, under standard solicitor trust conditions, and the Parties shall
enter into such documents as reasonably required by the Purchaser’s Counsel in
respect of this arrangement. This document will be delivered at the Time of
Closing and shall be executed by the Parties and the Purchaser’s Counsel.

 

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4.8 Allocation of Purchase Price

The Vendor and the Purchaser agree to report the sale and purchase of the
Purchased Assets for all federal, provincial and local tax purposes in a manner
consistent with the allocation agreed to amongst the Parties.

 

4.9 Transfer Taxes

For greater certainty, the Purchase Price shall be exclusive of, and the
Purchaser shall pay out all federal and provincial sales taxes (including any
GST and retail sales taxes) and all other taxes, duties, fees or other like
charges of any jurisdiction properly payable in connection with the transfer of
the Purchased Assets by the Vendor to the Purchaser.

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF THE VENDOR

Subject to Section 5.20, the Vendor hereby represents and warrants to the
Purchaser and to Legend as follows and acknowledge acknowledges that the
Purchaser is relying on such representations and warranties in connection with
its purchase of the Purchased Assets and the completion of the other
transactions hereunder and that the Purchaser would not purchase the Purchased
Assets without these representations and warranties:

 

5.1 Organization

The Vendor is duly incorporated and organized, and is validly subsisting under
the laws of the Province of Alberta. The Vendor has all necessary corporate
power and authority to own or lease or dispose of its undertakings, property and
assets and to carry on the business as now being conducted by it.

 

5.2 Authorization

The Vendor has all necessary corporate power and authority to enter into this
Agreement and the documents ancillary to this Agreement and to perform its
obligations hereunder and thereunder. All necessary corporate action has been
taken by the Vendor to authorize its execution and delivery of this Agreement
and the documents ancillary to this Agreement to be delivered by it and subject
to Section 10.2 the performance of its obligations hereunder and thereunder.
This Agreement has been duly authorized, executed and delivered by the Vendor
and is a legal, valid and binding obligation of the Vendor, enforceable against
it in accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency and other laws affecting the rights of creditors
generally and the discretionary nature of equitable remedies and defences or
similar laws of general application.

 

5.3 No Alteration of Business

To the knowledge of the Vendor, there has not been an alteration to the business
conducted in relation to the Purchased Assets between the date of the letter of
intent entered between the Vendor and Legend on July 8, 2011 and the Closing
Date which would have a Material Adverse Effect on the value of the Purchased
Assets.

 

5.4 No Violation

The execution and delivery of this Agreement by the Vendor and the consummation
of the transactions herein provided for will not (whether after the passage of
time or notice or both), result in:

 

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  (a) the breach or violation of any of the provisions of, or constitute a
default under, or conflict with or cause the acceleration of any obligation of
the Vendor under: (i) any Contract to which the Vendor is a party or by which
any of its respective undertakings, properties or assets are bound or affected;
(ii) any provision of the constating documents or by-laws or resolutions of the
board of directors (or any committee thereof) or shareholders of the Vendor;
(iii) any judgment, decree, order or award of any court, governmental body or
arbitrator having jurisdiction over the Vendor; (iv) any Permit held by the
Vendor or held for the benefit of or necessary to the operation of the Purchased
Assets; or (v) any Applicable Law; and

 

  (b) the creation or imposition of any Encumbrance other than Permitted
Encumbrances on any of the Purchased Assets.

 

5.5 Consents

The Vendor has (or will prior to the Closing Date):

 

  (i) obtained all consents required in connection with the transactions
contemplated in this Agreement; and

 

  (ii) caused all rights of first refusal or other restrictions on the transfer,
sale or assignment of the Purchased Assets to be waived or complied with.

 

5.6 Conduct of Business and Permits

The Vendor has complied with, and has conducted and is conducting the Purchased
Assets in compliance with, all Applicable Laws. The Vendor has all licences,
permits, approvals, consents, certificates, registrations or authorizations
necessary for the Purchased Assets.

 

5.7 Title to Purchased Assets

The Purchased Assets are free and clear of all liens, charges and Encumbrances,
adverse Claims, demands and royalties created by, through or under the Vendor
other than Permitted Encumbrances.

 

5.8 Significant Contracts

The Vendor Disclosure Letter contains a true, accurate and complete list of:
(i) all Contracts related to the Purchased Assets that are of such a nature or
amount as would reasonably be regarded as being significant in relation to the
Purchased Assets or in relation to the capital, prospects, condition (financial
or otherwise) or results of operation of the Vendor; and (ii) well files,
geological files, Vendor Proprietary Seismic Data, facility files, operations
files, production revenue and expense files, third party engineering evaluations
and any other files pertinent to the operation of the Purchased Assets (the
“Vendor Significant Contracts”). To the knowledge of the Vendor there is no
dispute between the Vendor and the other party in respect to the Vendor
Significant Contracts and the Vendor has performed all of the obligations
required to be performed by it and is entitled to all benefits under the Vendor
Significant Contracts, all of which were entered into by the Vendor in the
ordinary course.

 

5.9 Books and Records

The books and records of the Vendor fairly and correctly set out and disclose,
in accordance with Canadian generally accepted accounting principles, the
financial transactions related to the Purchased Assets as at the Closing Date,
and all financial transactions of the Vendor relating to the Purchased Assets
have been accurately recorded in such books and records. The system of internal
accounting controls is

 

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sufficient to provide reasonable assurances that transactions are executed in
accordance with management’s general or specific authorization and that
transactions are recorded as necessary to permit preparation of financial
statements in conformity with Canadian generally accepted accounting principles
and to maintain accountability for assets.

 

5.10 Taxes

To the Vendor’s knowledge there are no outstanding liabilities, or actions,
suits, proceedings, investigations or claims pending or threatened against the
Vendor, for Taxes payable, collectible or remittable by the Vendor, whether
assessed or not, which may result in an Encumbrance on or other claim against or
seizure or sale of all or any part of the Purchased Assets or would otherwise
adversely affect the Purchased Assets or would result in the Purchaser becoming
liable or responsible therefor. The Vendor has not made any election or
designation for purposes of any Applicable Law relating to Taxes that would
affect the Purchased Assets after the Closing Date.

 

5.11 Litigation

There are no Claims pending or, to the knowledge of the Vendor, after due
enquiry, threatened against or affecting the Vendor or the Purchased Assets
under Applicable Law by or before any Person or by a Governmental Authority. The
Vendor is not aware of any ground on which any such Claim might be commenced.

 

5.12 Consents and Approvals

There is no requirement for the Vendor to make any filing with, give any notice
to or obtain any licence, permit, certificate, registration, authorization,
consent or approval of, any Governmental Authority as a condition to the lawful
consummation of the transactions contemplated by this Agreement.

 

5.13 Residency

The Vendor is not a non-resident of Canada for the purposes of the Tax Act.

 

5.14 GST Registration

The Vendor is a registrant for purposes of the ETA.

 

5.15 Purchased Assets

The Purchased Assets are free and clear of all liens, charges, Encumbrances and
legal notations except for Permitted Encumbrances and, to Vendor’s knowledge
after due inquiry, there are no leasing arrangements, purchase or option to
purchase arrangements, licensing or occupancy arrangements, expropriation
proceedings or notices of expropriation, litigation, municipal or governmental
work orders, active files, deficiency notices, notices, directives or letters of
compliance, operational, maintenance or service contracts relating to or
affecting the Lands other than Permitted Encumbrances.

 

5.16 The Shares

 

  (a) The Vendor has not been organized for the purpose of acquiring the Shares.

 

  (b) The Vendor is acquiring Shares as principal for its own account and not on
behalf of any other Person, for investment purposes, and not with a view to the
distribution of the Shares or of any part thereof in violation of the Securities
Act or applicable state securities laws.

 

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  (c) The Vendor has adequate net worth and means to sustain a complete loss of
an investment in the Shares. The Vendor represents that it, either alone or with
its professional and/or financial advisors, has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of an investment in Legend. The Vendor acknowledges that no federal or
state agency has made any recommendation or endorsement of the Shares.

 

5.17 Environmental

 

  (a) The Vendor, in respect of the Purchased Assets, has been and is in
compliance with all applicable federal, provincial municipal and local laws,
statutes, ordinances, bylaws and regulations, and orders, directives and
decisions rendered by any ministry department or administrative or regulatory
agency relating to the protection of the environment, occupational health and
safety or the manufacture, processing, distribution, use, treatment, storage,
disposal, release, discharge, spill, emission, transport or handling of any
pollutants, contaminants, chemicals or industrial toxic, corrosive or hazardous
wastes or substances (“Environmental Laws”) except where such non-compliance
would not have a Material Adverse Effect on the Purchased Assets or their
operation. Except as disclosed in the Vendor Disclosure Letter, the Vendor has
never received any notice of and to its knowledge has never been investigated or
suspected of, received any correspondence related to, or been prosecuted for
non-compliance with any Environmental Laws, nor has the Vendor settled any
allegation of non-compliance.

 

  (b) The Vendor has obtained all licences, permits, approvals, consents,
certificates, registrations and other authorizations under Environmental Laws
(the “Environmental Permits”) required for the operation of the Purchased Assets
as of Closing Date.

 

  (c) The Vendor has not received from any Governmental Authority any notice
that the Vendor is potentially responsible for a federal, provincial, municipal
or local clean-up site or corrective action under any Environmental Laws in
connection with the Purchased Assets and the Vendor is not aware of any grounds
for which such a notice may be given to it. The Vendor, in connection with the
Purchased Assets, has not received any request for information in connection
with any federal, provincial, municipal or local inquiries as to disposal sites.

 

  (d) The Vendor has disclosed in the Vendor Disclosure Letter and has delivered
to the Purchaser a true and complete copy of all environmental audits,
evaluations, assessments, studies or tests relating to the Lands or Purchased
Assets that were commissioned by or for the Vendor or that are in the possession
or control of the Vendor, of which it is aware.

 

5.18 Oil and Gas

 

  (a) Any and all operations of the Vendor and its subsidiaries, and to the
knowledge of the Vendor, any and all operations by third parties, on or in
respect of the Purchased Assets of the Vendor or any of its subsidiaries, have
been conducted in compliance with good oilfield practices, except where the
failure to conduct operations in such manner would not in the aggregate have a
Material Adverse Effect on the Vendor.

 

  (b) Although it does not warrant title, the Vendor does represent and warrant
that, to the knowledge of the Vendor, the Purchased Assets are free and clear of
adverse Claims and Encumbrances other than the Permitted Encumbrances created
by, through or under the Vendor, and the Vendor holds the Petroleum and Natural
Gas Rights under valid and subsisting leases, licenses, permits, concessions,
concession agreements, contracts, subleases, reservations or other agreements.

 

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  (c) To its knowledge, all ad valorem, property, production, severance and
similar taxes and assessments based on or measured by the ownership of property
or the production of Leased Substances, or the receipt of proceeds therefrom,
due and payable in respect of the Purchased Assets prior to the date hereof have
been properly and fully paid and discharged, and there are no unpaid taxes or
assessments, other than Permitted Encumbrances, which could result in a lien or
charge on the Purchased Assets.

 

  (d) The Vendor has not received notice of any default under any of the Leases
and other Title and Operating Documents or any other agreement or instrument
pertaining to the Purchased Assets to which it or any of its subsidiaries is a
party or by or to which it or any of its subsidiaries or any such assets are
bound or subject, except to the extent that such defaults would not in the
aggregate have a Material Adverse Effect on the Vendor.

 

  (e) To its knowledge:

 

  (i) The Vendor is in good standing under all, and is not in default under any;
and

 

  (ii) there is no existing condition, circumstance or matter which constitutes
or which, with the passage of time or the giving of notice, would constitute a
default under any,

Leases and other Title and Operating Documents or any other agreements and
instruments pertaining to the Purchased Assets to which it or any of its
subsidiaries is a party or by or to which it or any of its subsidiaries or such
assets are bound or subject and, to the knowledge of the Vendor, all such
Leases, Title and Operating documents and other agreements and instruments are
in good standing and in full force and effect and none of the counterparties to
such Leases, Title and Operating documents and other agreements and instruments
is in default thereunder

 

  (f) All Wells operated by the Vendor, and to the knowledge of the Vendor with
respect to any Wells not operated by the Vendor, located on the Lands in which
the Vendor has an interest, or lands with which such Lands have been pooled or
unitized, which have been abandoned have been abandoned in accordance with all
Applicable Laws regarding the abandonment of Wells.

 

  (g) The Tangibles used or intended for use in connection with the Purchased
Assets:

 

  (i) for which the Vendor was or is operator, was or has been constructed,
operated and maintained in accordance with good and prudent oil and gas industry
practices in Canada and all Applicable Laws during all periods in which the
Vendor was operator thereof and is in good condition and repair, ordinary wear
and tear excepted, and is useable for its intended purposes in the ordinary
course of business; and

 

  (ii) for which the Vendor was not or is not operator, to the knowledge of the
Vendor, was or has been constructed, operated and maintained in accordance with
good and prudent oil and gas industry practices in Canada and all Applicable
Laws during all periods in which none of the Vendor or its subsidiaries was
operator thereof and is in good condition and repair, ordinary wear and tear
excepted, and is useable for its intended purposes in the ordinary course of
business;

 

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except to the extent that such non-compliance with prudent oil and natural gas
industry practices or Applicable Laws would not in the aggregate have a Material
Adverse Effect on the Vendor.

 

  (h) All fees in respect of well data in respect of which the Vendor or any of
its subsidiaries (or the relevant operator) has a licence, have been duly paid.

 

  (i) Except as set forth in the Vendor Disclosure Letter, the Vendor has not
entered into any material joint venture with a third party.

 

  (j) There are no outstanding authorizations for expenditure pertaining to any
of the Purchased Assets or any other commitments, approvals or authorizations
pursuant to which an expenditure may be required to be made in respect of such
assets after the date of the most recent Vendor Financial Statements in excess
of $50,000 for each such commitment, approval or authorization.

 

  (k) Except as set forth in the Vendor Disclosure Letter, there are no areas of
mutual interest applicable to or binding upon the Vendor, its subsidiaries or
any of their respective oil and natural gas assets.

 

  (l) There is no right of first refusal or other pre-emptive right applicable
to any of the Purchased Assets, whereby any Person (other than the Vendor
pursuant to this Agreement), has, as a result of the entering into of this
Agreement by the Parties, a right to purchase any of such assets or any other
right of first refusal or pre-emptive right in respect of the Purchased Assets.

 

  (m) Except as set forth in the Vendor Disclosure Letter, the interests of the
Vendor in the Purchased Assets is not subject either to reduction on account of
actions or omissions taken or omitted by them or conversion or subject to change
to an interest of any other size, and such interests are not subject to penalty
or forfeiture as a result of non- participation in any joint operation.

 

  (n) Except as set forth in the Vendor Disclosure Letter, the interests of the
Vendor in and to the Tangibles is sufficient such that neither the Vendor nor
any of its subsidiaries is subject to any penalty, fee, levy, charge or other
compensation payable to any third party for the use of or access to such
tangibles.

 

  (o) Except as set forth in the Vendor Disclosure Letter, the Vendor: (i) has
not alienated or encumbered its Purchased Assets or any part or portion thereof;
(ii) has not committed or is not aware of there having been committed any act or
omission whereby such Purchased Assets or any part or portion thereof may be
cancelled or determined, and such Purchased Assets are now free and clear of all
liens, royalties, conversion rights and other claims of third parties, created
by, through or under the Vendor or of which the Vendor has knowledge.

 

  (p) The Vendor is not a party to and Purchased Assets are not otherwise bound
or affected by any (i) production sales contracts that cannot be terminated on
notice of 31 days or less (without an early termination penalty or other cost),
(ii) gas balancing or similar agreements pertaining to the Leased Substances,
(iii) agreements for the transportation,

 

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  processing or disposal of the Leased Substances or any of them or substances
produced in connection with the Leased Substances or any of them,
(iv) agreements for the contract operation by a third party of such Purchased
Assets or any of them, and (v) agreements to provide transportation, processing
or disposal capacity or service to any third party.

 

5.19 Full Disclosure

Neither this Agreement nor any document to be delivered by the Vendor, including
the Vendor Disclosure Letter, nor any certificate, report, statement or other
document furnished by the Vendor in connection with the negotiation of this
Agreement contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary to make the statements
contained herein or therein not misleading. There has been no event, transaction
or information that has come to the attention of the Vendor that has not been
disclosed to the Purchaser in writing that could reasonably be expected to have
a Material Adverse Effect on the Purchased Assets.

 

5.20 As Is Where Is

Purchaser acknowledges that it is purchasing the Purchased Assets on an “as is,
where is” basis without representation and warranty and without reliance on any
information provided to or on behalf of Purchasers by Vendor except the Vendor
represents and warrants set forth in this Article 5.

ARTICLE 6

REPRESENTATIONS AND WARRANTIES PERTAINING TO LEGEND

Legend and the Purchaser jointly and severally represent and warrant to the
Vendor as follows about Legend and acknowledges and confirms that the Vendor is
relying on such representations and warranties in connection with its sale of
the Purchased Assets:

 

6.1 Organization

Legend is a Corporation validly formed and subsisting under the laws of the
State of Colorado and has all necessary corporate power to enter into this
Agreement and to perform its obligations hereunder.

 

6.2 Authorization and Reservation of Shares

Legend has all necessary corporate power and authority to enter into this
Agreement and the documents ancillary to this Agreement and to perform its
obligations hereunder and thereunder. All necessary corporate action has been
taken by Legend to authorize its execution and delivery of this Agreement and
the documents ancillary to this Agreement to be delivered by it and the
performance of its obligations hereunder and thereunder. This Agreement has been
duly authorized, executed and delivered by Legend and is a legal, valid and
binding obligation of Legend, enforceable against Legend by the Vendor in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency and other laws affecting the rights of creditors
generally and the discretionary nature of equitable remedies and defences or
similar laws of general application. The issuance of the Shares under this
Agreement has been duly authorized by Legend, and the Shares issuable hereunder
have been reserved for issuance by Legend.

 

6.3 No Alteration of Business

There has not been an alteration to the business conducted in relation to the
Legend’s Assets between the date of the letter of intent entered between the
Purchaser and Legend on July 8, 2011 and the Closing Date which would have
Material Adverse Effect on Legend.

 

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6.4 No Violation

The execution and delivery of this Agreement by Legend and the consummation of
the transactions herein provided for will not (whether after the passage of time
or notice or both), result in:

 

  (a) the breach or violation of any of the provisions of, or constitute a
default under, or conflict with or cause the acceleration of any obligation of
Legend under: (i) any Contract to which Legend is a party or by which any of its
respective undertakings, properties or assets are bound or affected; (ii) any
provision of the constating documents or by-laws or resolutions of the board of
directors (or any committee thereof) or shareholders of Legend; (iii) any
judgment, decree, order or award of any court, governmental body or arbitrator
having jurisdiction over Legend; (iv) any licence, permit, approval, consent or
authorization held by Legend or held for the benefit of or necessary to the
operation of the Legend Assets; or (v) any Applicable Law; and

 

  (b) the creation or imposition of any Encumbrance on any of the Legend Assets;

 

6.5 Conduct of Business and Permits

Legend has complied with, and has conducted and is conducting Legend’s Assets in
compliance with, all Applicable Laws. Legend has all Permits, consents,
certificates, registrations or authorizations necessary for the Legend’s Assets.

 

6.6 Books and Records

The books and records of Legend fairly and correctly set out and disclose, in
accordance with U.S. generally accepted accounting principles, the financial
transactions related to Legend as at the date hereof, and all financial
transactions of Legend have been accurately recorded in such books and records.
The system of internal accounting controls is sufficient to provide reasonable
assurances that transactions are executed in accordance with management’s
general or specific authorization and that transactions are recorded as
necessary to permit preparation of financial statements in conformity with U.S.
generally accepted accounting principles and to maintain accountability for
assets.

 

6.7 Litigation

Except as disclosed in the Legend Disclosure Letter there are no Claims pending
or, to the knowledge of Legend, threatened against or affecting Legend under
Applicable Law by or before any Person or by a Governmental Authority. Legend is
not aware of any ground on which any such Claim might be commenced.

 

6.8 Consents and Approvals

There is no requirement for Legend to make any filing with, give any notice to
or obtain any Permit, registration, authorization, consent or approval of, any
Governmental Authority as a condition to the lawful consummation of the
transactions contemplated by this Agreement.

 

6.9 Corporate

 

  (a) Legend has authorized 400,000,000 Common Shares, par value $0.001 per
share. As at the date hereof, 47,020,000 shares, warrants entitling the holders
thereof to acquire 4,100,000 shares at a weighted average exercise price of
US$1.35 are issued and outstanding. Legend has authorized 100,000,000 preferred
shares. As at the date hereof, 2,300,000 shares of Preferred Stock are issued
and outstanding. Except as set forth above,

 

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  there are no securities of Legend outstanding and no options, warrants or
other rights, agreements or commitments of any character whatsoever requiring
the issuance, sale or transfer by Legend of any shares of Legend, nor are there
any outstanding stock appreciation rights, phantom equity or similar rights,
agreements, arrangements or commitments based upon the book value, income or
other attributes of Legend. All outstanding shares of Legend have been duly
authorized and validly issued, are fully paid and non-assessable and are not
subject to, nor were they issued in violation of any pre-emptive rights, and all
shares issuable upon exercise of outstanding options and warrants in accordance
with their respective terms will, when issued, be duly authorized and validly
issued, fully paid and non-assessable and will not be subject to any pre-emptive
rights.

 

  (b) The Purchaser has no subsidiaries. Legend has no subsidiaries other than
Purchaser. No Person (other than Legend) holds any shares or other securities,
or securities convertible or exchangeable into securities of the Purchaser or
has any agreement, warrant, option, right or privilege (whether pre emptive or
contractual) being or capable of becoming an agreement for the purchase or
issuance of any shares or other securities of the Purchaser. Legend does not
hold any securities or other interests, or securities convertible or
exchangeable into securities or other interests of any other Person.

 

  (i) Since March 31, 2011 and except in respect of the transactions
contemplated by this Agreement:

 

  (A) There has not been any change in Legend from the position set forth in the
Legend Financial Statements provided that would constitute a Material Adverse
Effect; and

 

  (B) There have been no material facts, transactions, events or occurrences
which could reasonably be expected to result in a Material Adverse Effect in
Legend.

 

  (ii) Except as contemplated in this Agreement and as set forth in the Legend
Disclosure Letter, since March 31, 2011:

(A) Legend and Purchaser have conducted their business only in the ordinary and
normal course, consistent with past practice; and

(B) No liability or obligation of any nature (whether absolute, accrued,
contingent or otherwise) material to Legend or Purchaser, taken as a whole, has
been incurred other than in the ordinary and normal course of business,
consistent with past practice.

 

  (c) The Legend Financial Statements fairly present, in accordance with US
generally accepted accounting principles, consistently applied, the financial
position and condition of Legend and its subsidiaries on a consolidated bases at
the dates thereof and the results of the operations of Legend and its
subsidiaries on a consolidated basis for the periods then ended and reflect in
accordance with US generally accepted accounting principles, consistently
applied, all material assets, liabilities or obligations (absolute, accrued,
contingent or otherwise) of Legend and its subsidiaries on a consolidated basis
as at the dates thereof.

 

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  (d) Neither Legend nor any of its subsidiaries has not received notice of any
material violation of or investigation relating to any Applicable Laws and
Legend and its subsidiaries hold all permits, licenses and other authorization
which are required under Applicable Laws relating to Legend’s and its
subsidiaries’ assets, business or operations, except where the failure to comply
with the foregoing would not have a Material Adverse Effect on Legend. Legend’s
assets and its subsidiaries are operated and maintained by it and each of its
subsidiaries in compliance with all terms and conditions of Applicable laws,
permits, licenses and authorizations in all material respects.

 

  (e) No securities commission or similar regulatory authority, or stock
exchange has issued any order which is currently outstanding preventing or
suspending trading in any securities of Legend, no such proceeding is, to the
knowledge of Legend, pending, contemplated or threatened and Legend is not in
default of any requirement of any Applicable Laws.

 

  (f) Legend has not retained any financial advisor, broker, agent or finder, or
paid or agreed to pay or have the Vendor pay any financial advisor, broker,
agent or finder on account of this Agreement, any transaction contemplated
hereby or any transaction presently ongoing or contemplated.

 

  (g) Legend is not a party to any shareholder rights plan or any other form of
plan, agreement, contract or instrument that shall trigger any rights to acquire
shares or other securities of Legend rights, entitlements or privileges in
favour of any Person upon the entering into of this Agreement.

 

  (h) None of the Common Shares are the subject of any escrow, voting trust or
other similar agreement.

 

  (i) The corporate records and minute books, books of account and other records
of Legend and each of its subsidiaries have (whether of a financial or
accounting nature or otherwise) been maintained in accordance with, in all
material respects, all applicable statutory requirements and prudent business
practice and to the knowledge of Legend are complete and accurate in all
material respects (provided, however, minutes of board and committee meetings
which relate to the transaction contemplated herein have not been disclosed to
the Vendor).

 

  (j) Corporate Stock Transfer Inc. is appointed as registrar and transfer agent
for the Shares.

 

  (k) All Returns required to be filed by Legend at or before the Effective Time
have been or will be duly filed on a timely basis and all Taxes shown to be
payable on such Returns or on subsequent assessments with respect thereto have
been paid in full on a timely basis. Except for matters disclosed in the Legend
Financial Statements that may give rise to the filing of amended Returns, the
filed Returns are true, complete and correct in all material respects, and no
other Taxes are payable by Legend or any of its subsidiaries, with respect to
items or periods covered by such Returns.

 

  (l) No material deficiencies exist or have been asserted with respect to Taxes
of Legend. Legend is not a party to any Claim for assessment or collection of
Taxes, nor has such event been asserted or threatened against Legend. Except as
set forth in the Legend Disclosure Letter, the Returns have never been audited
by a government or taxing authority, nor is any such audit in process, pending
or threatened which resulted in or could result in a reassessment of Taxes owing
by Legend.

 

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  (m) Except for indemnity agreements with its directors and officers as
contemplated by the bylaws of Legend and Applicable Laws, and other than
standard or customary indemnity agreements in acquisition, purchase and sale,
underwriting and agency agreements, Legend’s agreements with its lenders, and in
the ordinary course provided to service providers, neither Legend nor any of its
subsidiaries is a party to or bound by any agreement, guarantee,
indemnification, or endorsement or like commitment of the obligations,
liabilities (contingent or otherwise) or indebtedness of any Person.

 

6.10 Securities Law

 

  (a) SEC Filings: Except as disclosed in writing to the Vendor, Legend has
filed all required forms, reports, statements, schedules, registration
statements and other documents required to be filed by it with the SEC since
January 1, 2009 and has, prior to the date hereof, delivered or made available
to the Vendor through the SEC’s EDGAR System (i) its annual report on Form 10-K
for its fiscal year ended December 31, 2010 (the “Legend 10-K”), (ii) its
quarterly reports on Form 10-Q for its fiscal quarters ended March 31, 2011 and
June 30, 2011, (iii) any proxy or information statements relating to meetings
of, or actions taken without a meeting by, the stockholders of Legend for all
meetings held or actions taken since December 31, 2008 and (iv) all of its other
forms, reports, statements, schedules, registration statements and other
documents filed with the SEC since December 31, 2008 (the documents referred to
in this Section 6.10(a) collectively with any other forms, reports, statements,
schedules, registration statements or other documents filed with the SEC
subsequent to the date hereof and prior to the Closing Date, the “Legend SEC
Documents”).

 

  (i) As of its filing date, each Legend SEC Document complied, and each such
Legend SEC Document filed subsequent to the date hereof and prior to the Closing
Date will comply, as to form in all material respects with the applicable
requirements of the Securities Act and Exchange Act, as the case may be.

 

  (ii) As of its filing date (or, if amended or superseded by a filing prior to
the date hereof, on the date of such filing), each Legend SEC Document did not,
and each such Legend SEC Document filed subsequent to the date hereof and prior
to the Closing Date on the date of its filing will not, contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. Notwithstanding the foregoing, no
representation or warranty is made by Legend with respect to statements made or
incorporated by reference in any Legend SEC Document filed subsequent to the
date hereof and prior to the Closing Date based on information supplied by the
Vendor specifically for inclusion or incorporation therein.

 

  (iii) To the knowledge of Legend, each director and executive officer of
Legend has filed with the SEC on a timely basis all statements required by
Section 16(a) of the Exchange Act and the rules and regulations thereunder since
January 1, 2009 except as indicated in its SEC filings.

 

  (iv) Legend is, as of the date of this Agreement, in compliance in all
material respects with all applicable requirements of the Securities Act, the
Exchange Act, the Sarbanes-Oxley Act of 2002, and the Dodd-Frank Wall Street
Reform and Consumer Protection Act.

 

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  (v) As used in this Section 6.10(a), the term “file” shall be broadly
construed to include any manner in which a document or information is furnished
to the SEC.

 

  (b) Investment Company: Neither Purchaser nor Legend are, and as of the
Closing Date neither Purchaser nor Legend will be, registered or required to be
registered as an “investment company” pursuant to the Investment Company Act of
1940, as amended.

 

  (c) Financial Statements; No Undisclosed Liabilities. The consolidated
financial statements of Legend included in the Legend SEC Documents comply as to
form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, have been
prepared in accordance with United States generally accepted accounting
principles (except, in the case of unaudited statements, as permitted by
Regulation S-X for quarterly reports on Form 10-Q) applied on a consistent basis
during the periods involved (except as may be indicated in the notes thereto)
and fairly present the financial condition of Legend and its consolidated
subsidiaries as of the respective dates thereof and the consolidated results of
their operations and cash flows for the respective periods then ended (subject,
in the case of unaudited statements, to the absence of footnote disclosure and
to normal and recurring year-end audit adjustments).

 

  (i) Except (A) as set forth in the consolidated financial statements
(including the notes thereto) included in the Legend 10-K or subsequent
quarterly reports on Form 10-Q filed by Legend and publicly available prior to
the date of this Agreement, (B) as incurred in the ordinary course of business
and (C) as may arise out of or in connection with this Agreement and the
transactions contemplated hereby, neither Legend nor any of its subsidiaries has
any liabilities or obligations of any nature (whether accrued, absolute,
contingent or otherwise) that individually or in the aggregate would reasonably
be expected to have a Material Adverse Effect on Legend.

 

  (ii) Neither Legend nor Purchaser has engaged in or effected any
securitization transactions or “off-balance sheet arrangements” (as defined in
Item 303(a) of Regulation S-K of the SEC).

 

  (iii) Legend has disclosed to Vendor in writing all non-audit services
performed by Legend’s external auditor since January 1, 2011.

 

  (d) Financial Controls. The officers of Legend required to provide
certifications as to Legend’s Forms 10-K and 10-Q pursuant to Rule 13a-15 or
15d-15 under the Exchange Act have (i) designed disclosure controls and
procedures required by Rule 13a-15 or 15d-15 under the 1934 Act, or caused such
disclosure controls and procedures to be designed under their supervision, to
ensure that information required to be disclosed by Legend in reports that it
files or submits under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the SEC rules and forms, and to
ensure that information required to be disclosed in the reports that it files or
submits under the Exchange Act is accumulated and communicated to its
management, including its chief executive officer and chief financial officer,
to allow timely decisions regarding required disclosure, and (ii) have
disclosed, based on their most recent evaluation of internal control over
financial reporting, to Legend’s auditors and the audit committee of Legend’s
board of directors (A) any significant deficiencies and material weaknesses in
the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect Legend’s ability to record, process,
summarize and report financial information and (B) any fraud, whether or not
material, that involves management or other employees who have a significant
role in Legend’s internal control over financial reporting.

 

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6.11 Oil and Gas

 

  (a) Any and all operations of Legend, and to the knowledge of Legend, any and
all operations by third parties, on or in respect of Legend’s assets have been
conducted in compliance with good oilfield practices, except where the failure
to conduct operations in such manner would not in the aggregate have a Material
Adverse Effect on Legend.

 

  (b) Although it does not warrant title, Legend is not aware of any defects,
failures or impairments in the title of Legend to the Legend assets or defaults
by Legend in respect thereof, which in aggregate could have a Material Adverse
Effect on Legend.

 

6.12 Full Disclosure

Neither this Agreement nor any document to be delivered by Legend (including the
Legend Disclosure Letter) nor any certificate, report, statement or other
document furnished by Legend in connection with the negotiation of this
Agreement contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary to make the statements
contained herein or therein not misleading. There has been no event, transaction
or information that Legend has knowledge of that has not been disclosed to the
Vendor in writing that could reasonably be expected to have a Material Adverse
Effect on Legend.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES PERTAINING TO THE PURCHASER

The Purchaser and Legend jointly and severally represent and warrant to the
Vendor as follows and acknowledges and confirms that the Vendor is relying on
such representations and warranties in connection with its sale of the Purchased
Assets:

 

7.1 Organization

The Purchaser is duly incorporated and organized, and is validly subsisting
under the laws of the Province of Alberta. The Purchaser has the corporate power
and authority to own or lease or dispose of its undertakings, property and
assets and to carry on the business as now being conducted by it.

 

7.2 Authorization

The Purchaser has all necessary corporate power and authority to enter into this
Agreement and the documents ancillary to this Agreement and to perform its
obligations hereunder and thereunder. All necessary corporate action has been
taken by the Purchaser to authorize its execution and delivery of this Agreement
and the documents ancillary to this Agreement to be delivered by it and the
performance of its obligations hereunder and thereunder. This Agreement has been
duly authorized, executed and delivered by the Purchaser and is a legal, valid
and binding obligation of the Purchaser, enforceable against it in accordance
with its terms, except as enforcement may be limited by bankruptcy, insolvency
and other laws affecting the rights of creditors generally and the discretionary
nature of any equitable remedies and defences or similar laws of general
application.

 

7.3 Availability and Source Funds

Purchaser has arranged to have available by the Closing Date sufficient
immediately available funds in Canadian Dollars to enable it to pay in full the
Purchase Price (and any subsequent adjustments thereto) to

 

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the Vendor as herein provided and otherwise to fully perform its obligations
under this agreement. The funds which will be advanced by the Purchaser
hereunder will not represent proceeds of crime for the purposes of the Proceeds
of Crime (Money Laundering) and Terrorist Financing Act (Canada) (“PCMLTFA”) and
the Purchaser acknowledges that the Vendor may in the future be required by law
to disclose the Purchaser’s name and other information relating to this
Agreement, on a confidential basis, pursuant to the PCMLTFA. To the best of the
Purchaser’s knowledge:

 

  (a) none of the funds to be provided by the Purchaser:

 

  (i) have been or will be derived from or related to any activity that is
deemed criminal under the laws of Canada, the United States of America, or any
other jurisdiction, or

 

  (ii) are being tendered on behalf of a Person who has not been identified to
the Purchaser; and

 

  (b) it shall promptly notify the Vendor if the Purchaser discovers that any of
such representations ceases to be true and to provide the Vendor with
appropriate information in connection therewith.

 

7.4 Corporate

The Purchaser has authorized an unlimited number of common shares. As at that
date hereof, ten (10) common shares are issued and outstanding. Except as set
forth above there are no securities of the Purchaser outstanding and no options,
warrants or other rights, agreements or commitments of any character whatsoever
requiring the issuance, sale or transfer by the Purchaser of any shares of the
Purchaser, nor are there any outstanding stock appreciation rights, phantom
equity or similar rights, agreements, arrangements or commitments based upon the
book value, income or other attributes of the Purchaser. All outstanding shares
of the Purchaser have been duly authorized and validly issued, are fully paid
and non-assessable and are not subject to, nor were they issued in violation of
any pre-emptive rights, and all shares issuable upon exercise of outstanding
options and warrants in accordance with their respective terms will, when
issued, be duly authorized and validly issued, fully paid and non-assessable and
will not be subject to any pre-emptive rights.

 

7.5 No Alteration of Business

The Purchaser was established for the purposes of this transaction contemplated
in this Agreement and has not conducted any business and has no property (other
then the cash consideration paid by its sole shareholder, Legend) and is not a
party to any Contract except for this Agreement and Contracts with its legal and
other professional advisors.

Legend hereby guarantees performance by Purchaser of all obligations of
Purchaser under the Agreement. Vendor shall not be required to seek to enforce
or resort to any remedies against Purchaser with respect to its obligations
under the Agreement prior to seeking to enforce such guarantee against Legend.

 

7.6 No Violation

The execution and delivery of this Agreement by the Purchaser and the
consummation of the transactions herein provided for will not (whether after the
passage of time or notice or both), result in:

 

  (a)

the breach or violation of any of the provisions of, or constitute a default
under, or conflict with or cause the acceleration of any obligation of the
Purchaser under: (i) any Contract to which the Purchaser is a party or by which
any of its respective undertakings,

 

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  properties or assets are bound or affected; (ii) any provision of the
provision of its constating documents or by-laws or resolutions of its board of
directors (or any committee thereof) or shareholders of the Purchaser; (iii) any
judgment, decree, order or award of any Government Authority; (iv) any Permit,
approval, consent or authorization held by the Purchaser or held for the benefit
of or necessary to the operation of the Purchased Assets; or (v) any Applicable
Law; and

 

  (b) the creation or imposition of any Encumbrance on any of the assets held by
the Purchaser;

 

7.7 Conduct of Business and Permits

The Purchaser has complied with, and has conducted and is conducting its
business in compliance with, all Applicable Laws. The Purchaser has all Permits,
approvals, consents, certificates, registrations or authorizations necessary to
conduct it business.

 

7.8 Residency

The Purchaser is not a non-resident of Canada for the purposes of the Tax Act.

 

7.9 GST Registration

The Purchaser is a registrant for purposes of the ETA.

 

7.10 Full Disclosure

Neither this Agreement nor any document to be delivered by the Purchaser nor any
certificate, report, statement or other document furnished by the Purchaser in
connection with the negotiation of this Agreement contains or will contain any
untrue statement of a material fact or omits or will omit to state a material
fact necessary to make the statements contained herein or therein not
misleading. There has been no event, transaction or information that has come to
the attention of the Purchaser that has not been disclosed to the Vendor in
writing that could reasonably be expected to have a Material Adverse Effect on
the Purchaser.

ARTICLE 8

SURVIVAL OF COVENANTS, REPRESENTATIONS AND WARRANTIES

 

8.1 Survival of Covenants, Representations and Warranties

The covenants, representations and warranties contained in this Agreement and in
all certificates and documents delivered pursuant to or contemplated by this
Agreement shall survive the closing of the transactions contemplated in this
Agreement and shall continue for the applicable limitation period
notwithstanding such closing nor any investigation made by or on behalf of the
Party entitled to the benefit thereof or any knowledge of such party; provided,
however, that:

 

  (a) the representations and warranties set out in Article 5, Article 6 and
Article 7 and the corresponding representations and warranties set out or
incorporated in the certificates to be delivered pursuant to Article 10 shall
terminate 12 months after the Closing Date, except in instances of fraud, in
which case such representations and warranties shall survive indefinitely; and

 

  (b) the representations and warranties contained in Section 6.8 and 6.9 shall
survive until the expiration of all applicable time periods for assessment,
reassessment, liens and appeals relating thereto, and any claim for breach of
such representations and warranties, to be effective, must be asserted in
writing prior to ninety (90) days after such expiration.

 

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ARTICLE 9

COVENANTS

 

9.1 Access to Purchased Assets

The Vendor shall forthwith make available to the Purchaser and its authorized
representatives and, if requested by the Purchaser, provide a copy to the
Purchaser of, all title documents, Contracts, financial statements, policies,
plans, reports, licences, orders, permits, books of account, accounting records
and all other documents, information and data relating to the Purchased Assets,
and as required, the Lands. The Vendor shall afford the Purchaser and its
authorized representatives every reasonable opportunity to have free and
unrestricted access to the Purchased Assets. The exercise of any rights of
inspection by or on behalf of the Purchaser under this Section 9.1 shall not
mitigate or otherwise affect any of the representations and warranties of the
Vendor hereunder, which shall continue in full force and effect as provided in
Section 8.1.

 

9.2 Conduct of Purchased Assets Prior to Closing

 

  (a) Without in any way limiting any other obligations of the Vendor hereunder,
from the Effective Date to the Time of Closing:

 

  (i) Conduct Business in the Ordinary Course. The Vendor shall: (i) operate and
maintain the Purchased Assets only in the ordinary and normal course of business
consistent with past practice and shall not, without the prior written consent
of the Purchaser, enter into any transaction or refrain from doing any action
that, if effected, would constitute a breach of any representation or warranty,
or would constitute a breach of any covenant or other obligation of the Vendor
contained herein; (ii) pay its liabilities only when due and in amounts and at
times which are consistent with past practice; (iii) perform and comply with all
covenants and conditions in the Title and Operating Documents and any other
agreements and documents to which the Purchased Assets are subject; and (iv) not
enter into any material Contracts or obligations or commitments out of the
ordinary course of business with respect to the Purchased Assets (Vendor’s share
of which is $50,000 for any single item) without the written consent of the
Purchaser, except as may be reasonably necessary to protect, ensure life and
safety or preserve the Purchased Assets or title to the Purchased Assets.

 

  (b) Continue Insurance. The Vendor shall continue to maintain in full force
and effect all policies of insurance or renewals thereof now in effect.

 

  (c) Best Efforts. The Vendor shall use its commercially reasonable efforts to
satisfy the conditions contained in Section 10.1.

 

9.3 Conduct of Legend’s Assets Prior to Closing

Without in any way limiting any other obligations of Legend or the Purchaser
hereunder, during the period from the date hereof to the Time of Closing:

 

  (a) Conduct Business in the Ordinary Course. Legend shall: (i) conduct
Legend’s assets only in the ordinary and normal course consistent with past
practice and shall not, without the

 

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  prior written consent of the Vendor, enter into any transaction or refrain
from doing any action that, if effected before the date of this Agreement, would
constitute a breach of any representation or warranty, or would constitute a
breach of any covenant or other obligation of Legend contained herein;
(ii) maintain and conduct Legend’s assets on a basis consistent with past
practice; (iii) pay its liabilities only when due and in amounts and at times
which are consistent with past practice; (iv) not enter into any material
Contracts with respect to Legend’s assets, without the consent of the Vendor,
which consent shall not be unreasonably withheld; and (vi) maintain in full
force and effect all policies of insurance or renewals thereof now in effect.

 

  (b) Continue Insurance. Legend and the Purchaser shall continue to maintain in
full force and effect all policies of insurance or renewals thereof now in
effect.

 

  (c) Best Efforts. Legend and the Purchaser shall use their best efforts to
satisfy the conditions contained in Section 10.2.

 

9.4 Abandonment and Reclamation

Following the Closing Date, Purchaser shall in compliance with applicable
Environmental Laws (including in accordance with timing requirements thereunder)
perform or arrange for performance of all abandonment and reclamation
obligations pertaining to the Purchased Assets which, in the absence of this
Agreement would be the responsibility of the Vendor. Purchaser shall be liable
to Vendor and the Vendor Indemnified Parties for and shall indemnify Vendor and
the Vendor Indemnified Parties from and against all losses, costs, claims,
damages, expenses and liabilities suffered, sustained, paid or incurred by
Vendor or the Vendor Indemnified Parties should Purchaser fail to timely perform
such obligations.

 

9.5 SEC Filings and Registration Rights

 

  (a) Form 10 Information. Legend shall, within 30 calendar days following the
Closing Date, file with the SEC a Report on Form 8-K that contains current “Form
10 information” (as such term is defined in Rule 144 under the Securities Act)
(the “Super 8-K”). For greater certainty, the “Form 10 information” contained in
such Super 8-K shall be prepared as of a date no earlier than the Closing Date.

 

  (b) SEC Filings. Legend shall timely file with the SEC all reports and other
materials required to be filed by Legend pursuant to Section 13 or 15(d) of the
Exchange Act.

 

  (c) Resale Registration Statement. Legend shall, within 30 calendar days
following the Closing Date, file with the SEC under the Securities Act, a
registration statement on Form S-1 (or such other form as Legend may then be
permitted to use) (the “Resale Registration Statement”) in order to permit the
resale by the Vendor of the Shares issuable to the Vendor, pursuant to
Section 3.1 hereunder, on the Closing Date (the “Closing Shares”). Legend shall
use reasonable best efforts to cause the Resale Registration Statement to become
effective, and to continuously maintain the effectiveness of the Resale
Registration Statement until the earlier of (i) the date on which all of the
Closing Shares have been sold by the Vendor and (ii) the date that is 12 months
following the date on which the Super 8-K is filed with the SEC (provided that
in the case of clause (ii), Legend shall also have provided to the Vendor an
officers’ certificate to the effect that as of such date Legend meets the
requirements of Rule 144(i)(2)).

 

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  (d) Piggyback  Registration Rights. For so long as the Vendor holds any
Shares, the Vendor shall have the right to include any of its Shares, other
than, to the extent not already registered under the Resale Registration
Statement, the Closing Shares, (the “Additional Shares”) in any registration of
Legend’s Common Shares under the Securities Act. In order to give effect to the
foregoing provision, Legend shall provide the Vendor with a minimum of 10
Business Days’ advance written notice of any proposed registration of Legend’s
securities under the Securities Act, and upon receipt of such notice, Legend
shall, if it desires to include any Additional Shares in such registration,
within 7 Business Days of receipt of such notice, provide written notice to
Legend with respect to the number of Additional Shares that the Vendor desires
to have included in such registration. Legend shall include all of such
Additional Shares in such registration.

 

9.6 TSX Approval

The Parties shall provide all necessary information, including, without
restricting the generality of the forgoing, all financial statements and oil and
gas information as may be reasonably required for the Vendor to receive approval
from the Toronto Stock Exchange relating to the Agreement.

 

9.7 Seismic Data (other than Vendor Proprietary Seismic Data)

 

  (a) In the event that the Purchaser wishes to obtain a copy of any or all of
the Joint Venture Proprietary Seismic Data, the Purchaser shall be solely
responsible for obtaining any consent required for the copying thereof and all
costs and expenses (including third party licensing fees) associated with the
licensing of any such Joint Venture Proprietary Data. The Vendor shall waive its
share of any such fees.

 

  (b) In the event that the Purchaser wishes to obtain a copy of any or all of
the Trade Seismic Data, the Purchaser shall be solely responsible for obtaining
any consent required for the copying thereof and all costs and expenses
(including third party licensing fees) associated with the licensing of any
Trade Seismic Data and acknowledges that Vendor has no obligation or right to
assign or obtain Trade Seismic Data to Purchaser.

 

9.8 Delivery of Conveyancing Documents

The Vendor shall deliver to the Purchaser all necessary deeds, conveyances,
bills of sale, assurances, registerable transfers, novation agreements, specific
assignments, trust agreements and any other documentation necessary or
reasonably required to transfer the Purchased Assets to the Purchaser, free and
clear of all Encumbrances whatsoever except for Permitted Encumbrances.

 

9.9 Delivery of Vendor’s Closing Documentation

The Vendor shall deliver to the Purchaser at the Time of Closing:

 

  (a) a General Conveyance executed by the Vendor;

 

  (b) the Lock-Up Agreement executed by the Vendor;

 

  (c) a certificate of good standing as a corporation existing under the laws of
the Province of Alberta at the Time of Closing;

 

  (d) a receipt acknowledging receipt of the Purchase Price from the Purchaser;

 

  (e) the Specific Conveyances;

 

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  (f) any consents required from third parties, including the Vendor’s lendors
with respect to the transactions contemplated by this Agreement;

 

  (g) except in relation to Permitted Encumbrances a no-interest letter from the
Vendor’s lendor’s with respect to its security interests in connection with the
Purchased Assets; and such other “no interest” letters as may be required with
respect to any security interest created or granted by the Vendor prior to the
Time of Closing;

 

  (h) evidence of receipt of all required Authorizations for consummation of the
purchase and sale contemplated in this Agreement, including, the TSX approval,
as provided in Section 9.4;

 

  (i) a certificate as described in Section 10.1(a) and Section 10.1(b);

 

  (j) a certified copy of a resolution of the board of directors of the Vendor
authorizing and approving the transactions contemplated in this Agreement;

 

  (k) a certified copy of a resolution (or certified copy of the minutes of
meeting) of the shareholders of the Vendor authorizing and approving the
transactions contemplated in this Agreement;

 

  (l) the Title and Operating Documents;

 

  (m) the legal opinion contemplated in Section 10.1(i);

 

  (n) such other item as may be specifically required hereunder or as may be
reasonably requested by the Purchaser.

 

9.10 Delivery of Purchaser’s Closing Documentation

The Purchaser and Legend shall deliver to the Vendor at the time of Closing:

 

  (a) a General Conveyance executed by the Purchaser;

 

  (b) a certificate of good standing for Legend as a corporation existing under
the laws of the State of Colorado at the Time of Closing and a certificate of
good standing for Purchaser as a corporation existing under the laws of the
Province of Alberta at the Time of Closing;

 

  (c) the cash component of the Purchase Price, adjusted as provided in
Section 3.3(a);

 

  (d) certificates representing the Shares duly endorsed for transfer;

 

  (e) a certified copy of a resolution of the board of directors of the
Purchaser and Legend authorizing and approving the transactions contemplated in
this Agreement; and

 

  (f) a certificate executed by Purchaser and Legend as described in
Section 10.2(a) and Section 10.2(b);

 

  (g) the legal opinion contemplated in Section 10.2(j);

 

  (h) a certificate as described in Section 10.2(l); and

 

  (i) such other item as may be specifically required hereunder or as may be
reasonably requested by the Vendor.

 

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ARTICLE 10

CONDITIONS OF CLOSING

 

10.1 Conditions of Closing in Favour of the Purchaser and Legend

The following shall be conditions precedent to the Purchaser’s and Legend’s
respective obligations to complete the purchase and sale contemplated by this
Agreement, and which shall be for the exclusive benefit of the Purchaser and
Legend:

 

  (a) Representations and Warranties. The representations and warranties of the
Vendor contained in Article 5 shall be true and correct in all material respects
at the Time of Closing with the same force and effect as if such representations
and warranties were made at and as of such time, and a certificate of the
President of the Vendor, dated the Closing Date, to that effect shall have been
delivered to the Purchaser and Legend, such certificate to be in form and
substance satisfactory to the Purchaser, acting reasonably.

 

  (b) Covenants. All of the terms, covenants and conditions of this Agreement to
be complied with or performed by the Vendor at or before the Time of Closing
shall have been complied with or performed, and a certificate of the President
of the Vendor, dated the Closing Date, to that effect shall have been delivered
to the Purchaser and Legend, such certificate to be in form and substance
satisfactory to the Purchaser, acting reasonably.

 

  (c) Authorizations. All necessary regulatory and contractual Authorizations
shall have been obtained as are required to be obtained by the Vendor to permit
the change of ownership of the Purchased Assets contemplated hereby, including,
without limitation, those described in the Vendor Disclosure Letter, in each
case in form and substance satisfactory to the Purchaser, acting reasonably.

 

  (d) No Action or Proceeding. No legal or regulatory Claim shall be pending or
threatened by any Person other than a Party hereto to enjoin, restrict or
prohibit the purchase and sale of the Purchased Assets contemplated hereby.

 

  (e) No Material Adverse Effect. There shall have been no Material Adverse
Effect in the condition (financial or otherwise), assets, liabilities,
operations, earnings, business or prospects of the Purchased Assets since the
date of the Vendor Financial Statements or the Effective Date.

 

  (f) Legal Matters. All actions, proceedings, instruments and documents
required to implement this Agreement, or instrumental thereto, and all legal
matters relating to the purchase of the Purchased Assets, shall have been
approved as to form and legality by the Purchaser’s Counsel, acting reasonably.

 

  (g) Shareholder Approval of Vendor. The sale of the Purchased Assets shall
have been approved by the shareholders of the Vendor prior to the Time of
Closing.

 

  (h) Toronto Stock Exchange Approval. The Toronto Stock Exchange shall have
given any necessary approval of the transaction prior to the Time of Closing.

 

  (i) Legal Opinion. An opinion by Vendor’s counsel, in form and substance
satisfactory to the Purchaser and Legend, each acting reasonably, dated the
Closing Date, shall have been delivered to the Purchaser and Legend with respect
to the good standing of the Vendor and the receipt of the necessary corporate
approvals by the Vendor.

 

 

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  (i) Lock-Up Agreement. Legend shall have received from Vendor a fully executed
Lock-Up Agreement.

If any of the conditions described in this Section 10.1 shall not be performed
or fulfilled at or prior to the Time of Closing to the satisfaction of Legend
and the Purchaser, acting reasonably, the Purchaser may, by written notice to
the Vendor, terminate this Agreement and the obligations of the Parties under
this Agreement, other than the obligations contained in Sections 15.6; without
limiting their right to commence proceedings in respect of any Losses and
Liabilities, if any, suffered by either or both of Legend and the Purchaser,
where the non-performance or non-fulfilment of the relevant condition is as a
result of a breach of covenant, representation or warranty by the Vendor. Any
condition may be waived in whole or in part by Legend and the Purchaser without
prejudice to any remedies or other claims either may have for breach of
covenant, representation or warranty by the Vendor.

 

10.2 Conditions of Closing in Favour of the Vendor

The following shall be conditions precedent to the Vendor’s obligations to
complete the purchase and sale contemplated by this Agreement, and which shall
be for the exclusive benefit of the Vendor:

 

  (a) Representations and Warranties. The representations and warranties of the
Purchaser and Legend contained in Article 6 and Article 7, respectively shall be
true and correct in all material respects at the Time of Closing with the same
force and effect as if such representations and warranties were made at and as
of such time, and a certificate of a senior officer of the Purchaser, dated the
Closing Date, to that effect shall have been delivered to the Vendor, such
certificate to be in form and substance satisfactory to the Vendor acting
reasonably.

 

  (b) Covenants. All of the terms, covenants and conditions of this Agreement to
be complied with or performed by the Purchaser and Legend at or before the Time
of Closing shall have been complied with or performed, and certificates of the
President of the Purchaser and Legend, dated the Closing Date, to that effect
shall have been delivered to the Vendor, such certificate to be in form and
substance satisfactory to the Vendor, acting reasonably.

 

  (c) Authorization. The Vendor shall have received resolutions of each of the
Board of Directors and the Shareholders of Vendor approving the purchase and
sale contemplated by this Agreement and the delivery and performance of this
Agreement.

 

  (d) Consents. All necessary regulatory and contractual consents and approval
shall have been obtained as are required to be obtained by the Purchaser and
Legend to permit the change of ownership of the Purchased Assets contemplated
hereby, including, without limitation, those described in the Vendor Disclosure
Letter, in each case in form and substance satisfactory to the Vendor, acting
reasonably.

 

  (e) General Security Agreement. The Purchaser shall provide a general security
agreement in a form satisfactory to the Vendor to secure its obligations under
the Agreement, including but not limited to its obligations under Sections 4.1
and 4.4.

 

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  (f) No Action or Proceeding. No Claims shall be pending or threatened by any
Person other than a Party hereto to enjoin, restrict or prohibit the purchase
and sale of the Purchased Assets contemplated hereby.

 

  (g) No Material Adverse Effect. There shall have been no Material Adverse
Effect in the condition (financial or otherwise), assets, liabilities,
operations, earnings, business or prospects of the Purchaser or Legend since the
date of Legend Financial Statements.

 

  (h) Legal Matters. All actions, proceedings, instruments and documents
required to implement this Agreement, or instrumental thereto, shall have been
approved as to form and legality by the Vendor’s counsel, acting reasonably.

 

  (i) Shareholder Approval of Vendor. The sale of the Purchased Assets shall
have been approved by the shareholders of the Vendor prior to the Time of
Closing.

 

  (j) Toronto Stock Exchange Approval. The Toronto Stock Exchange shall have
given any necessary approval of the transaction prior to the Time of Closing.

 

  (k) Legal Opinion. An opinion by Legend’s counsel, being Lane Powell, in form
and substance satisfactory to the Vendor, acting reasonably, dated the Closing
Date, shall have been delivered to the Vendor with respect to the good standing
of the Purchaser and Legend, the receipt of the necessary approvals and as to
the due issance of the Common Shares by Legend.

 

  (l) Lock-Up Agreements. Vendor shall have received a certificate from Legend’s
U.S. counsel, being Lane Powell, certifying that each person who has entered
into a subscription agreement with Legend has executed a lock-up agreement in
the form of Lock-Up Agreement attached hereto as Schedule 5.

If any of the conditions described in this Section 10.2 shall not be performed
or fulfilled at or prior to the Time of Closing to the satisfaction of the
Vendor, acting reasonably, the Vendor may, by written notice to Legend and the
Purchaser, terminate this Agreement and the obligations of the Parties under
this Agreement, other than the obligations contained in Section 15.6; without
limiting their right to commence proceedings in respect of any Losses and
Liabilities, if any if any, suffered by it, where the non-performance or
non-fulfilment of the relevant condition is as a result of a breach of covenant,
representation or warranty by the Purchaser or Legend. Any condition may be
waived in whole or in part by the Vendor without prejudice to any remedies or
other claims it may have for breach of covenant, representation or warranty by
Legend or the Purchaser.

ARTICLE 11

TITLE DEFECTS

 

11.1 Deficiency Statement

No later than five (5) days prior to Time of Closing, the Purchaser may provide
to the Vendor a deficiency statement which lists all Title Defects in reasonable
detail, together with the Purchaser’s requirements for rectifying the same,
including all agreements, or other instruments, which appear to be missing and
which are reasonably necessary in order to establish the Vendor’s title to the
Purchased Assets.

 

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11.2 Election

 

(a) The Vendor will use commercially reasonable efforts to furnish all missing
Title and Operating Documentation and to remedy the Title Defects. If the Vendor
fails or is unable to satisfy any Title Defect to the reasonable satisfaction of
the Purchaser on or before the Business Day prior to Closing Time, the Purchaser
will be entitled to elect at or before the Time of Closing by written notice to
the Vendor, to do one of the following:

 

  (i) where the cumulative amount by which the value of the affected interests
has been reduced is, in the Purchaser’s opinion acting reasonably, less than 15%
of the Purchase Price, the Purchaser shall complete the purchase of the Vendor’s
interest in and to the Purchased Assets without adjustment of the Purchase Price
on account of such defects or omissions; or

 

  (ii) where the cumulative amount by which the value of the affected interests
has been reduced is, in the Purchaser’s opinion acting reasonably, 15% or more
of the Purchase Price:

 

  (A) delay the Closing Date to a date mutually agreeable to the Parties, in
which case:

 

  (I) the Vendor shall make further attempts to cure or remove the uncured Title
Defects; and

 

  (II) when such mutually agreeable time and date arrives, the elections
pursuant to this Subsection 11.2(a)(ii) shall once again be made; or

 

  (B) waive the uncured Title Defects, in which case all of the Vendor’s
interest in and to the Purchased Assets shall be purchased by the Purchaser
without an adjustment to the Purchase Price; or

 

  (C) require the Vendor to elect as to whether the Vendor will sell the
Vendor’s interest in and to the Purchased Assets and proceed to Closing or
remove the Purchased Assets affected by the uncured Title Defects and reduce the
Purchase Price by the value of the removed Purchased Assets. In the event that
the Parties disagree as to the value allocated by the Purchaser to the removed
Purchased Assets, the Parties will resolve the dispute in accordance with
Section 11.3.

 

(b) Failure of the Purchaser to make an election at or before the Time of
Closing pursuant to Section 11.2 shall be deemed to be an election by the
Purchaser pursuant to Subsection 11.2(a)(ii)(B).

 

(c) Upon Time of Closing, the Purchaser will be deemed to have waived
permanently all Title Defects pertaining to the acquired Assets.

 

11.3 Arbitration

If the Parties disagree with the value allocated to an affected interest, the
Parties shall forthwith meet in good faith to discuss the issue. If after such a
meeting, the issue has not been resolved or if a Party does not forthwith meet
to discuss the issue, the issue shall be resolved by referral to arbitration in
accordance with the provisions of Article 14. Closing of the transaction shall
proceed based on the value allocated by the Purchaser, acting reasonably and
subject to adjustment following the decision of the Arbitration. Forthwith after
the decision of the arbitrator has been rendered, if the value determined by the
arbitrator differs from the value allocated by the Purchaser, the Parties shall
forthwith make an adjustment to the Purchase Price between themselves to reflect
the decision of the arbitrator.

 

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ARTICLE 12

CLOSING DATE AND TRANSFER OF POSSESSION

 

12.1 Transfer of Possession

Subject to compliance with the terms and conditions hereof, the transfer of
title and possession of the Purchased Assets will pass to the Purchaser and will
be deemed to take effect as of the Closing Date at the Closing Time.

 

12.2 Place of Closing

The closing shall take place at the Time of Closing at the offices of Borden
Ladner Gervais LLP, Centennial Place, East Tower, 1900, 520 – 3rd Avenue SW,
Calgary, Alberta.

 

12.3 Further Assurances

From time to time subsequent to the Closing Date, each Party covenants and
agrees that it will at all times after the Closing Date, at the expense of the
requesting Party, promptly execute and deliver all such documents, including,
without limitation, all such additional conveyances, transfers, consents and
other assurances and do all such other acts and things as the other Party,
acting reasonably, may from time to time request in writing be executed or done
in order to better evidence or perfect or effectuate any provision of this
Agreement or of any agreement or other document executed pursuant to this
Agreement by any of the Parties or any of the respective obligations intended to
be created hereby or thereby.

 

12.4 Delivery of Title and Operating Documents

Unless the Parties otherwise agree in writing, the Vendor shall deliver to the
Purchaser, in an organized form, all records, files, reports, data and documents
constituting the Miscellaneous Interests, as soon as is practicable after the
Closing Date (and in any event no later than 10 days after the Closing Date),
provided that if the Vendor retains any interest in any property to which a
Title and Operating Document relates, the Vendor may retain the original copy
and provide a photocopy to the Purchaser.

 

12.5 Risk of Loss

From the date hereof up to the Time of Closing, the Purchased Assets shall be
and remain at the risk of the Vendor. If, prior to the Time of Closing, all or
any part of the Purchased Assets that are necessary to carry on the Purchased
Assets as currently conducted are destroyed or damaged by fire or any other
casualty or shall be appropriated, expropriated or seized by a Governmental
Authority, the Purchaser shall, in the Purchaser’s sole discretion, either
(i) complete the purchase without reduction of the Purchase Price, in which
event all proceeds of insurance or compensation for expropriation or seizure
shall be paid to the Purchaser at the Time of Closing and all right and claim of
the Vendor to any such amounts not paid by the Closing Date shall be assigned at
the Time of Closing to the Purchaser; or (ii) terminate this Agreement without
any further obligation on its or Legend’s part hereunder.

ARTICLE 13

INDEMNIFICATION

 

13.1 Indemnification by the Vendor

The Vendor agrees to indemnify and save harmless the Purchaser/Legend
Indemnified Parties from all Losses and Liabilities suffered or incurred by the
Purchaser/Legend Indemnified Parties as a result of or arising directly or
indirectly out of or in connection with any breach of any covenant by the Vendor
or

 

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any inaccuracy of any representation or warranty of the Vendor contained in this
Agreement or in any agreement, certificate or other document delivered pursuant
hereto, provided:

 

  (a) that the Vendor shall be not required to indemnify or save harmless the
Purchaser/Legend Indemnified Parties in respect of any breach or inaccuracy of
any covenant, representation or warranty unless the Purchaser/Legend Indemnified
Parties shall have provided notice to the Vendor in accordance with Section 15.1
on or prior to the expiration of the applicable time period related to such
covenant, representation and warranty as set out in Section 8.1; and

 

  (b) that the obligation of the Vendor to indemnify the Purchaser and Legend
pursuant to this Section 13.1 shall be applicable only if the aggregate of all
those Losses and Liabilities incurred by the Purchaser/Legend Indemnified
Parties is in excess of $25,000 (the “Threshold Losses”). If the aggregate of
all those Losses and Liabilities incurred by the Purchaser/Legend Indemnified
Parties exceeds the Threshold Losses, the Vendor shall be obliged to indemnify
the Purchaser/Legend Indemnified Parties for all of those Losses and Liabilities
suffered or incurred by the Purchaser/Legend Indemnified Parties, including the
amount of the Threshold Losses.

 

13.2 Indemnification by the Purchaser and Legend

The Purchaser and Legend agree to indemnify and save harmless the Vendor
Indemnified Parties from all Losses and Liabilities suffered or incurred by the
Vendor Indemnified Parties as a result of or arising directly or indirectly out
of or in connection with any breach of any covenant by Legend or the Purchaser,
or any inaccuracy of any representation or warranty of Legend or the Purchaser
contained in this Agreement or in any agreement, certificate or other document
delivered pursuant hereto, provided:

 

  (a) that Legend and the Purchaser shall not be required to indemnify or save
harmless the Vendor Indemnified Parties in respect of any breach or inaccuracy
of any covenant representation or warranty unless the Vendor Indemnified Parties
shall have provided notice to Legend and the Purchaser in accordance with
Section 15.1 on or prior to the expiration of the applicable time period related
to such covenant representation and warranty as set out in Section 8.1); and

 

  (b) that the obligation of Legend and the Purchaser to indemnify the Vendor
Indemnified Parties pursuant to this Section 12.2 shall be applicable only if
the aggregate of all those Losses and Liabilities incurred by the Vendor
Indemnified Parties is in excess of the Threshold Losses. If the aggregate of
all those Losses and Liabilities incurred by the Vendor exceeds the Threshold
Losses, Legend and the Purchaser shall be obliged to indemnify the Purchaser
Indemnified Parties for all of those Losses and Liabilities incurred by the
Vendor Indemnified Parties, including the amount of the Threshold Losses.

 

13.3 Abandonment and Reclamation

Purchaser shall see to the timely performance of all abandonment and reclamation
obligations pertaining to the Purchased Assets which, in the absence of this
Agreement would be the responsibility of the Vendor. Purchaser shall be liable
to Vendor for and shall indemnify Vendor from and against all Losses and
Liabilities suffered, sustained, paid or incurred by Vendor should Purchaser
fail to timely perform such obligations.

 

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13.4 Cumulative Rights

The rights, recourses and remedies provided to the indemnified Party under this
Article 12 are in addition to any other right an indemnified Party may have or
may hereafter acquire under any Applicable Law or any other provision of this
Agreement or otherwise, and any right, recourse or remedy of the indemnified
Party may be asserted completely against the indemnifying Party, without regard
to the rights, recourses or remedies the indemnified Party may have against any
third party.

 

13.5 Consequential Damages

In no event shall a Party be liable to the other Party for special or
consequential damages.

ARTICLE 14

DISPUTE RESOLUTION

 

14.1 Arbitration Proceedings

The Parties will attempt to resolve any dispute arising hereunder through
consultation and negotiation in good faith. If those attempts fail, a Party may,
by notice to the other Party at any time during those negotiations, refer the
dispute to binding arbitration for final resolution if the dispute pertains to
the value of Purchased Assets for which Title Defects remain uncured under
Article 11. Any such arbitration, and any other arbitration the Parties may
agree to conduct hereunder, will be conducted under the Commercial Arbitration
Rules of The Canadian Foundation for Dispute Resolution.

ARTICLE 15

MISCELLANEOUS

 

15.1 Notices

Except as otherwise provided in this Agreement, any notices under this Agreement
shall be in writing and shall be effective: (a) upon delivery by hand, (b) when
sent by a nationally recognized overnight courier service, in which case notice
shall be deemed delivered one (1) business day after deposit with the courier;
or (c) by facsimile, if a copy of the notice is also sent by government post,
first class postage prepaid, in which case notice shall be deemed delivered on
transmittal by facsimile provided that a transmission report is generated
reflecting the accurate transmission of the notices, in each case to the Parties
as follows:

if to the Purchaser or Legend:

 

LEGEND OIL AND GAS LTD. 1420 5th Avenue, Suite 2200 Seattle, WA 98101 Attention:
   James Vandeberg Fax No.    206-224-2880 with a copy to: MACLEOD DIXON LLP
3700, 400 - 3rd Avenue SW Calgary, Alberta, T2P 4H2 Attention:    Richard Skeith
Fascimile:    403-264-5973

 

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if to the Vendor:

 

INTERNATIONAL SOVEREIGN ENERGY CORP.

1750, 801 - 6th Avenue SW

Calgary, AB T2P 3W2

Attention:    Sharad Mistry, President Fascimile:.    (403) 264-7035 with a copy
to:

BORDEN, LADNER, GERVAIS LLP

Centennial Place, East Tower

1900, 520 – 3rd Avenue SW

Calgary, Alberta T2P 0R3

Attention :    Angie Redecopp Fascimile :    (403) 266-1395

Either Party may at any time change its address for service from time to time by
giving notice to the other Party in accordance with this Section 15.1.

 

15.2 Non-Transferability

 

  (a) Subject to Sections 15.2(b) and 15.2(c), to the extent that any Purchased
Asset is not capable of being sold, assigned, transferred, delivered or
subleased without the consent or waiver of any Person, or if such sale,
assignment, transfer, delivery or sublease, or attempted sale, assignment,
delivery or sublease would constitute a breach thereof or a violation of any
Applicable Law, this Agreement shall not constitute a sale, assignment,
transfer, delivery or sublease thereof, or an attempted sale, assignment,
transfer, delivery or sublease thereof until such consent or waiver of the
applicable Person is received.

 

  (b) The Vendor shall use its commercially reasonable efforts (and the
Purchaser shall reasonably cooperate with the Vendor) on or before the Closing
Date and thereafter as required, to obtain the consents and waivers referred to
in Section 15.2(a) and to resolve the impediments to the sale, assignment,
transfer, delivery or sublease referred to in Section 15.2(a), and to obtain any
other consents and waivers necessary to convey to the Purchaser all of the
Purchased Assets.

 

  (c) Subject to the written approval of the Purchaser, in its sole discretion,
to the extent that the consents and waivers referred to in Section 15.2(a) are
not obtained by the Vendor, or until the impediments to the sale, assignment,
transfer, delivery or sublease referred to therein are resolved, the Vendor
shall, after the Closing Date:

 

  (i) hold the benefits of any Purchased Asset referred to in Section 15.2(a) in
trust for the Purchaser in accordance with the provisions of this
Section 15.2(c);

 

  (ii) cooperate in any reasonable and lawful arrangement, approved by the
Purchaser, designed to provide such benefits to the Purchaser, without the
Vendor thereby incurring any financial obligation to the Purchaser; and

 

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  (iii) enforce and perform for the account of the Purchaser, any rights or
obligations of the Vendor arising from any Purchased Asset referred to in
Section 15.2(a) against or in respect of any Person, including the right to
elect to terminate in accordance with the terms thereof upon the advice of the
Purchaser;

provided, however, that this Section 15.2(c) shall not constitute a waiver of
any right of the Purchaser to require delivery of all consents and waivers on
the Closing Date pursuant to Section 10.1.

 

  (d) If the Vendor provides the Purchaser with the use of any Purchased Asset
referred to in Section 15.2(a) without having obtained the necessary consents
and waivers referred to in that Section, and if the use by the Purchaser
constitutes a breach or violation of any Contract, permit, authorization or
approval to which the Vendor is a party or by which the Vendor or such Purchased
Asset is bound, the Vendor shall be responsible for any Losses and Liabilities
suffered or incurred by the Purchaser/Legend Indemnified Parties arising as a
consequence of such breach or violation under any such Contract, Permit,
authorization or approval.

 

15.3 Commissions, etc

The Vendor agrees to indemnify and save harmless the Purchaser from and against
all Losses and Liabilities suffered or incurred by the Purchaser/Legend
Indemnified Parties in respect of any commission or other remuneration payable
or alleged to be payable to any broker, agent or other intermediary who purports
to act or have acted for or on behalf of the Vendor. The Purchaser and Legend
agree to indemnify and save harmless the Vendor from and against all Losses and
Liabilities suffered or incurred by the Vendor Indemnified Parties in respect of
any commission or other remuneration payable or alleged to be payable to any
broker, agent or other intermediary who purports to act or have acted for or on
behalf of the Purchaser, Legend or both of them.

 

15.4 Consultation

The Parties shall consult with each other before issuing any press release or
making any other public announcement with respect to this Agreement or the
transactions contemplated hereby and, except as required by any Applicable Law,
neither of them shall issue any such press release or make any such public
announcement without the prior written consent of the other, which consent shall
not be unreasonably withheld or delayed.

 

15.5 Disclosure

Prior to any public announcement of the transaction contemplated hereby neither
Party shall disclose this Agreement or any aspects of such transaction except to
its board of directors, its senior management, its legal, accounting, financial
or other professional advisors, any financial institution contacted by it with
respect to any financing required in connection with such transaction and
counsel to such institution, or as may be required by any Applicable Law or any
regulatory authority or stock exchange having jurisdiction.

 

15.6 Confidentiality

Except as required by Applicable Law, the Parties to this Agreement shall
maintain the confidentiality of any information received from each other in
connection with the transactions contemplated by this Agreement, whether
received before or after the date of this Agreement. If the transfer of the
Purchased Assets to the Purchaser is not consummated, each shall return to the
other any confidential schedules,

 

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documents, or other written information obtained from the other in connection
with this Agreement whether received before or after the date of this Agreement.
The Purchaser and Legend agree that, except as otherwise authorized by the
Vendor or required by Applicable Law, neither the Purchaser nor Legend nor their
respective representatives, agents or employees will disclose to third parties
or use any confidential information or confidential data relating to the Vendor
or the Purchased Assets discovered by the Purchaser or Legend or their
respective representatives as a result of the Vendor making available to the
Purchaser or Legend and their respective representatives the information
requested by them in connection with the transactions contemplated herein
(“Vendor Confidential Information”). The Vendor agrees that, except as otherwise
authorized by the Purchaser or required by Applicable Law, neither the Vendor
nor its representatives, agents or employees will disclose to third parties or
use any confidential information or confidential data relating to the Purchaser,
Legend or the Legend assets discovered by the Vendor or its representatives as a
result of the Purchaser or Legend making available to the Vendor and its
representatives the information requested by it in connection with the
transactions contemplated herein. Notwithstanding the foregoing, the Purchaser
and Legend shall be permitted to disclose the Vendor Confidential Information to
National Bank Financial with a view to financing the acquisition of the
Purchased Assets, including any professional consultants retained by such bank
provided that such bank and its respective employees and consultants have been
informed of and have agreed to comply with the obligations of confidentiality
and restrictions on use contained herein.

 

15.7 Assignment by Purchaser

No Party may assign its rights and obligations under this Agreement in whole or
in part, without the prior written consent of the other Parties.

 

15.8 Best Efforts

The Parties acknowledge and agree that, for all purposes of this Agreement, an
obligation on the part of either Party to use its best efforts to obtain any
waiver, consent, approval, permit, licence or other document shall not require
such Party to make any payment to any Person for the purpose of procuring the
same, other than payments for amounts due and payable to such Person, payments
for incidental expenses incurred by such Person and payments required by any
Applicable Law.

The remainder of this page intentionally left blank

 

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15.9 Counterparts

This Agreement may be executed in any number of counterparts (and delivered by
facsimile or other electronic means), each of which shall constitute an original
and all of which taken together shall constitute one and the same instrument.

IN WITNESS WHEREOF this Agreement has been executed by the Parties as of the
date first set forth above.

 

INTERNATIONAL SOVEREIGN ENERGY CORP. Per:  

/s/ Sharad Mistry

I have authority to bind the corporation. Print Name: Sharad Mistry
Title: Chief Executive Officer, Chief Financial Officer LEGEND OIL AND GAS LTD.
Per:  

 

I have authority to bind the corporation. Print Name: Title:   Per:  

 

I have authority to bind the corporation. LEGEND ENERGY CANADA LTD. Per:  

 

I have authority to bind the corporation. Print Name: Title:   Per:  

 

I have authority to bind the corporation. Print Name: Title:

 

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15.9 Counterparts

This Agreement may be executed in any number of counterparts (and delivered by
facsimile or other electronic means), each of which shall constitute an original
and all of which taken together shall constitute one and the same instrument.

IN WITNESS WHEREOF this Agreement has been executed by the Parties as of the
date first set forth above.

 

INTERNATIONAL SOVEREIGN ENERGY CORP. Per:  

 

I have authority to bind the corporation. Print Name: Title: Per:  

 

I have authority to bind the corporation. Print Name: Title: LEGEND OIL AND GAS
LTD. Per:  

/s/ Marshall Diamond-Goldberg

I have authority to bind the corporation. Print Name: Marshall Diamond-Goldberg
Title:   President Per:  

/s/ James Vandeberg

I have authority to bind the corporation.

VP

LEGEND ENERGY CANADA LTD. Per:  

/s/ Marshall Diamond-Goldberg

I have authority to bind the corporation. Print Name: Marshall Diamond-Goldberg
Title:   President Per:  

/s/ James Vandeberg

I have authority to bind the corporation. Print Name: Title: VP

 

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SCHEDULE 1

LANDS, LEASES, HYDROCARBON INTERESTS AND PRODUCTION ENCUMBRANCES

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

FILE NO.   SPLIT   PROV   AREA   FHCR   LOCATION
DESCRIPTION RIGHTS   WELL_NO   PARTNER   WIPERCEN   ROYALTYT   ALLPRODP   PAIDTO
  PAIDTOPER   PAID BY   PAIDBYPER   ROYALTY M0007   A   AB   WILDMERE   CR   TWP
47-RGE 22 PNG from TOP of SURFACE to BASE of MANNVILLE     THIRD PARTY   100  
LSR   S/S     LESSOR   100   THIRD PARTY   100   ON 100.0000% PRODUCTION;
NONCONV. M0958   A   AB   WILDMERE   CR   TWP 47-RGE 12 (LSD 13 PNG from TOP of
SURFACE to BASE of VIKING   100/13-12-047-05-W4/00   THIRD PARTY   100   LSR  
S/S     LESSOR   100   THIRD PARTY   100   ON 100.0000% PRODUCTION; NONCONV.
M0958   B   AB   WILDMERE   CR   TWP 47-RGN & SE 14 PNG from TOP of SURFACE to
BASE of MANNVILLE   100/01-14-047-05-W4/00   THIRD PARTY   100   LSR   S/S    
LESSOR   100   THIRD PARTY   100   ON 100.0000% PRODUCTION; NONCONV. M0958   B  
AB   WILDMERE   CR   TWP 47-RG14 (LSDS 3, 5 & 6]   100/02-14-047-05-W4/00      
GOR       INTLSVRN   5.41665   THIRD PARTY   100   ON 100.0000% PRODUCTION;
NONCONV. M0958   B   AB   WILDMERE   CR     100/03-14-047-05-W4/00       CONT  
    THIRD PARTY   16.25     100   M0958   B   AB   WILDMERE   CR    
100/06-14-047-05-W4/00       CONT       THIRD PARTY   8.67335     100   M0958  
B   AB   WILDMERE   CR     100/07-14-047-05-W4/00       CONT       THIRD PARTY  
25     100   M0958   B   AB   WILDMERE   CR     100/10-14-047-05-W4/00      
CONT       THIRD PARTY   44.66     100   M0958   B   AB   WILDMERE   CR    
100/13-14-047-05-W4/00                     M0958   B   AB   WILDMERE   CR    
100/14-14-047-05-W4/00                     M0958   B   AB   WILDMERE   CR    
100/15-14-047-05-W4/00                     M0958   B   AB   WILDMERE   CR    
100/16-14-047-05-W4/02                     M0959   A   AB   WILDMERE   CR   TWP
47-RW 16 PNG from TOP of SURFACE to BASE of MANNVILLE     INTLSVRN   5.41665  
LSR   S/S     LESSOR   100   INTLSVRN   5.416663   ON 100.0000% PRODUCTION;
NONCONV. M0959   A   AB   WILDMERE   CR   TWP 47-R( 16 (LSD 10)     THIRD PARTY
  25.4175   CONT           THIRD PARTY   25.41749   M0959   A   AB   WILDMERE  
CR       THIRD PARTY   9.16745   CONT           THIRD PARTY   9.16745   M0959  
A   AB   WILDMERE   CR       THIRD PARTY   25   CONT           THIRD PARTY   25
  M0959   A   AB   WILDMERE   CR       THIRD PARTY   25   CONT           THIRD
PARTY   25   M0959   A   AB   WILDMERE   CR       THIRD PARTY   9.9984   CONT  
        FREEHOLD   9.9984   M0959   B   AB   WILDMERE   CR   TWP 47-R( 16 (LSDS
2, PNG from TOP of SURFACE to BASE of MANNVILLE   100/02-16-047-04-W4/00  
INTLSVRN   5.41665   LSR   S/S     LESSOR   100   INTLSVRN   5.416663   ON
100.0000% PRODUCTION; NONCONV. M0959   B   AB   WILDMERE   CR    
100/07-16-047-04-W4/00   THIRD PARTY   16.25   CONT           THIRD PARTY  
16.41666   M0959   B   AB   WILDMERE   CR       THIRD PARTY   18.33495   CONT  
        THIRD PARTY   18.33495   M0959   B   AB   WILDMERE   CR       THIRD
PARTY   25   CONT           THIRD PARTY   25   M0959   B   AB   WILDMERE   CR  
    THIRD PARTY   25   CONT           THIRD PARTY   25   M0959   B   AB  
WILDMERE   CR       THIRD PARTY   9.9984   CONT           FREEHOLD   9.9984  
M1025   A   AB   WILDMERE   CR   TWP 47-R( 18 (LSDS 3 PNG from TOP of SURFACE to
BASE of MANNVILLE     THIRD PARTY   5.41665   LSR   S/S     LESSOR   100  
INTLSVRN   5.416663   ON 100.0000% PRODUCTION; NONCONV. M1025   A   AB  
WILDMERE   CR   TWP 47-RN & SE 18     THIRD PARTY   25.4175   CONT          
THIRD PARTY   25.41749   M1025   A   AB   WILDMERE   CR   TWP 47-RS, NW 20, 20
(LSDS 9, 10 & 15     THIRD PARTY   9.16745   CONT           THIRD PARTY  
9.16745   M1025   A   AB   WILDMERE   CR   TWP47-R29 (LSDS 3 & 4)     THIRD
PARTY   25   CONT           THIRD PARTY   25   M1025   A   AB   WILDMERE   CR  
TWP 47-RS 30     THIRD PARTY   25   CONT           THIRD PARTY   25   M1025   A
  AB   WILDMERE   CR       THIRD PARTY   9.9984   CONT           FREEHOLD  
9.9984   M1025   B   AB   WILDMERE   CR   TWP 47-R 18 LSDS 4 PNG from TOP of
SURFACE to BASE of MANNVILLE   CO/05-18-047-04-W4/00   INTLSVRN   5.41665   LSR
  S/S     LESSOR   100   INTLSVRN   5.416663   ON 100.0000% PRODUCTION; NONCONV.
M1025   B   AB   WILDMERE   CR   TWP 47-R( 20 (LSD 16)     THIRD PARTY   16.25  
CONT           THIRD PARTY   16.41666   M1025   B   AB   WILDMERE   CR   TWP
47-RSW 28     THIRD PARTY   18.33495   CONT           THIRD PARTY   18.33495  
M1025   B   AB   WILDMERE   CR   TWP 47-R SE 29, 29 (LSDS 5 & 6)     THIRD PARTY
  25   CONT           THIRD PARTY   25   M1025   B   AB   WILDMERE   CR      
THIRD PARTY   25   CONT           THIRD PARTY   25   M1025   B   AB   WILDMERE  
CR       THIRD PARTY   9.9984   CONT           FREEHOLD   9.9984   M1119   A  
AB   HAYS   CR   TWP 13-RS 35 PNG from TOP of SURFACE to BASE of BOW ISLAND  
100/06-35-013-16-W4/02   INTLSVRN   60   LSR   S/S     LESSOR   100   INTLSVRN  
60   ON 100.0000% PRODUCTION; NONCONV. M1119   A   AB   HAYS   CR       THIRD
PARTY   40   CONT           THIRD PARTY   40   M1125   A   BC   FLATROCK   CR  
TWP 85-R( Sec. 17 PNG from TOP of SURFACE to BASE of ARTEX/HALF  
100/06-17-085-15-W6/00   INTLSVRN   26.25   LSR   S/S     LESSOR   100   ALL WI
  100   ON 100.0000% PRODUCTION; NONCONV. M1125   A   BC   FLATROCK   CR      
THIRD PARTY   28.25   GOR     7   THIRD PARTY   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV. M1125   A   BC   FLATROCK   CR       THIRD PARTY
  0   GOR       THIRD PARTY   50   INTLSVRN   30   S/S: 1/150.0000 (4.0000 -
12.0000%) OIL; 12.0000% GAS; ON 50.0000% PRODUCTION; CONV APO TO 20.0000000%
M1125   A   BC   FLATROCK   CR       THIRD PARTY   16.5   CONT       THIRD PARTY
    THIRD PARTY   32.286   M1125   A   BC   FLATROCK   CR       THIRD PARTY  
6.25   CONT           THIRD PARTY   18.857   M1125   A   BC   FLATROCK   CR    
  THIRD PARTY   6.25   CONT           THIRD PARTY   18.857   M1125   A   BC  
FLATROCK   CR       THIRD PARTY   16.5   GOR       THIRD PARTY   100   INTLSVRN
  30   S/S: 1/150.0000 (3.0000 - 12.0000%) OIL; 12.0000% GAS; ON 37.5000%
PRODUCTION; NONCONV M1128   A   BC   AITKEN CREEK   CR   NTS 94-A-116, 17, 26,
PNG from TOP of SURFACE to BASE of CHARLIE LA   d-017-J/094-A-13   THIRD PARTY  
100   LSR   S/S     LESSOR   100   THIRD PARTY   100   ON 100.0000% PRODUCTION;
NONCONV. M1128   A   BC   AITKEN CREEK   CR     d-026-J/094-A-13       GOR      
INTLSVRN   2.625   THIRD PARTY   100   S/S: 1/150.0000 (5.0000 - 15.0000%) OIL;
15.0000% GAS; ON 100.0000% PRODUCTION; CONV APO TO 50.0000000% M1129   A   AB  
BERGEN   CR   TWP 32-RNE 6 PNG from TOP of SURFACE to TOP of CARDIUM     THIRD
PARTY   20.375   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1129   A   AB   BERGEN   CR       THIRD PARTY   2.14625  
              M1129   A   AB   BERGEN   CR       THIRD PARTY   7.02129          
      M1129   A   AB   BERGEN   CR       THIRD PARTY   7.5                 M1129
  A   AB   BERGEN   CR       THIRD PARTY   4.5                 M1129   A   AB  
BERGEN   CR       THIRD PARTY   2.711                 M1129   A   AB   BERGEN  
CR       THIRD PARTY   51.424                 M1129   A   AB   BERGEN   CR      
INTLSVRN   2.34375                 M1129   A   AB   BERGEN   CR       THIRD
PARTY   1.5                 M1129   A   AB   BERGEN   CR       THIRD PARTY  
0.47871                 M1144   A   AB   ATLEE-BUFFALO   CR   TWP 20-R( Sec. 21
ALL PNG from BASE of MEDICINE HAT to BASE of VIKING   100/12-21-020-07-W4/00  
INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1172   A   BC   UMBACH   CR   NTS 94-H- 78,79,88, PNG from
TOP of SURFACE to BASE of BLUESKY   d-079-F/094-H-03   INTLSVRN   1.75   LSR  
S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1172  
A   BC   UMBACH   CR       THIRD PARTY   98.25   GOR     2   THIRD PARTY   100  
INTLSVRN   3.5   ON 50.0000% PRODUCTION; NONCONV. M1176   A   AB   LEA PARK   CR
  TWP 55-R( Sec. 12 PNG from TOP of SURFACE to BASE of MANNVILLE  
100/02-12-055-04-W4/00   INTLSVRN   25   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1176   A   AB   LEA PARK   CR    
100/07-12-055-04-W4/00   THIRD PARTY   25                 M1176   A   AB   LEA
PARK   CR     100/02-32-054-03-W4/00   THIRD PARTY   25                 M1176  
A   AB   LEA PARK   CR       THIRD PARTY   25                 M1180   A   AB  
HEATHDALE   CR   TWP 27-RNE 26 PNG from TOP of SURFACE to BASE of VIKING  
100/03-26-027-08-W4/02   THIRD PARTY   65   LSR   S/S     LESSOR   100   ALL WI
  100   ON 100.0000% PRODUCTION; NONCONV. M1180   A   AB   HEATHDALE   CR      
THIRD PARTY   35   GOR     5   INTLSVRN   25   THIRD PARTY   100   ON 65.0000%
PRODUCTION; NONCONV. M1182   A   AB   HEATHDALE   FH   TWP 27-RW & SE 26 PNG
from TOP of SURFACE to BASE of BASEMENT   100/03-26-027-08-W4/00   THIRD PARTY  
65   LSR     20   LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION;
NONCONV. M1182   A   AB   HEATHDALE   FH     100/03-26-027-08-W4/02   THIRD
PARTY   35   GOR     5   INTLSVRN   25   ALL WI   100   ON 65.0000% PRODUCTION;
NONCONV. M1183   A   AB   JOFFRE   CR   TWP 39-RNE 30 PNG from TOP of SURFACE to
TOP of NISKU     INTLSVRN   75   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV. M1183   A   AB   JOFFRE   CR       THIRD PARTY  
25   GOR       THIRD PARTY   100   ALL WI   100   S/S: 1/150.0000 (5.0000 -
15.0000%) OIL; 15.0000% GAS; ON 100.0000% PRODUCTION; NONCONV M1183   B   AB  
JOFFRE   CR   TWP 39-RNE 30 PNG from TOP of NISKU to BASE of NISKU  
100/09-30-039-26-W4/00   INTLSVRN   75   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1183   B   AB   JOFFRE   CR       THIRD
PARTY   25   GOR       THIRD PARTY   20   ALL WI   100   S/S: 1/150.0000 (5.0000
- 15.0000%) OIL; 15.0000% GAS; ON 100.0000% PRODUCTION; NONCONV M1184   A   AB  
JOFFRE   CR   TWP 39-RSW 30 PNG from TOP of SURFACE to BASE of MANNVILLE    
INTLSVRN   62.3982   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1184   A   AB   JOFFRE   CR       THIRD PARTY   17.5   GOR
      THIRD PARTY   100   INTLSVRN   75   S/S: 1/150.0000 (5.0000 - 15.0000%)
OIL; 15.0000% GAS; ON 70.0000% PRODUCTION; NONCONV M1184   A   AB   JOFFRE   CR
      THIRD PARTY   0   CONT           THIRD PARTY   25   M1184   A   AB  
JOFFRE   CR       THIRD PARTY   20.1018                 M1188   A   AB   SWAN
HILLS   CR   TWP 64-RNE 36 PNG from TOP of SURFACE to BASE of BEAVERHILL  
100/16-36-064-10-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1190   A   AB   RED EARTH   CR   TWP
87-RE 11 PNG from TOP of SURFACE to BASE of GRANITE WA   100/12-01-087-09-W5/00
  THIRD PARTY   62.5   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1190   A   AB   RED EARTH   CR     100/14-02-087-09-W5/02
  THIRD PARTY   25   GOR       INTLSVRN   100   THIRD PARTY   100   S/S:
1/150.0000 (5.0000 - 15.0000%) OIL; 15.0000% GAS; ON 50.0000% PRODUCTION;
NONCONV M1190   A   AB   RED EARTH   CR     100/01-11-087-09-W5/00   THIRD PARTY
  6.25                 M1190   A   AB   RED EARTH   CR       THIRD PARTY   6.25
                M1190   B   AB   RED EARTH   CR   TWP 87-RNW 1 PNG from TOP of
SURFACE to BASE of SLAVE POINT   100/03-11-087-09-W5/00   THIRD PARTY   62.5  
LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1190   B   AB   RED EARTH   CR     100/04-11-087-09-W5/00   THIRD PARTY   25  
GOR       INTLSVRN   100   THIRD PARTY   100   S/S: 1/150.0000 (5.0000 -
15.0000%) OIL; 15.0000% GAS; ON 50.0000% PRODUCTION; NONCONV M1190   B   AB  
RED EARTH   CR     100/07-11-087-09-W5/00   THIRD PARTY   6.25                
M1190   B   AB   RED EARTH   CR     100/08-11-087-09-W5/00   THIRD PARTY   6.25
                M1190   B   AB   RED EARTH   CR     100/09-11-087-09-W5/00      
              M1190   B   AB   RED EARTH   CR     100/11-11-087-09-W5/00        
            M1207   A   AB   LIEGE   CR   TWP 89-R( 18, 19 PNG from TOP of
SURFACE to BASE of NISKU   00/11-18-089-21-W4/00   INTLSVRN   10   LSR   S/S    
LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1207   A   AB  
LIEGE   CR   TWP 89-R( 12, 13, 24   00/04-19-089-21-W4/00   THIRD PARTY   7    
            M1207   A   AB   LIEGE   CR     00/13-12-089-22-W4/00   THIRD PARTY
  77                 M1207   A   AB   LIEGE   CR     00/06-13-089-22-W4/00  
THIRD PARTY   6                 M1207   A   AB   LIEGE   CR    
00/03-24-089-22-W4/00                     M1207   B   AB   LIEGE   CR   TWP89-R
7 PNG from TOP of SURFACE to BASE of NISKU     INTLSVRN   10   LSR   S/S    
LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1207   B   AB  
LIEGE   CR       THIRD PARTY   7                

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

M1207   B   AB   LIEGE   CR         THIRD PARTY   6                 M1207   B  
AB   LIEGE   CR         THIRD PARTY   77                 M1208   A   AB   LIEGE
  CR   TWP 89-R11, 22, 23   PNG from TOP of SURFACE   to BASE of NISKU  
00/10-11-089-22-W4/00     INTLSVRN   10   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1208   A   AB   LIEGE   CR   TWP 89-R  
14, 15     00/07-14-089-22-W4/00   THIRD PARTY   7                 M1208   A  
AB   LIEGE   CR       00/16-22-089-22-W4/00   THIRD PARTY   77                
M1208     A     AB   LIEGE   CR       02/10-23-089-22-W4/00   THIRD PARTY   6  
              M1209   A   AB     LIEGE   CR   TWP 89-R 8   PNG from TOP of
SURFACE to BASE of NISKU   00/05-17-089-21-W4/00   INTLSVRN   10   LSR   S/S    
LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1209   A   AB  
LIEGE     CR   TWP 89-R 17         THIRD PARTY   7                 M1209   A  
AB   LIEGE   CR         THIRD PARTY   77                 M1209   A   AB   LIEGE
  CR         THIRD PARTY   6                 M1210   A   BC   FT. ST. JOHN    
CR     TWP 83-R 8   PNG from TOP of SURFACE to BASE of PARDONET/BALDONNEL    
100/08-08-083-18-W6/00     INTLSVRN   0   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1210   A   BC   FT. ST. JOHN   CR      
100/16-08-083-18-W6/02   THIRD PARTY   100   GOR       INTLSVRN   100   THIRD
PARTY   100   S/S: 1/23.8365 (5.0000 - 15.0000%) OIL; 15.0000% GAS; ON 50.0000%
PRODUCTION; CONV APO TO 22.5000000% M1210   A   BC   FT. ST. JOHN   CR      
100/16-08-083-18-W6/03                     M1211   A   BC   FT. ST. JOHN   CR  
TWP 83-R 8   PNG from BASE of PARDONET/B to BASE of BELLOY     INTLSVRN   22.5  
LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1211   A   BC   FT. ST. JOHN   CR         THIRD PARTY   77.5   GOR      
INTLSVRN   100   THIRD PARTY   100   S/S: 1/23.8365 (5.0000 - 15.0000%) OIL;
15.0000% GAS; ON 50.0000% PRODUCTION; CONV APO TO 22.5000000% M1212   A   BC  
INGA   CR   TWP 85-RNW 20   PNG from TOP of SURFACE to BASE of CHARLIE LAKE A  
  INTLSVRN   90   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1212   A   BC   INGA   CR         THIRD PARTY   10        
        M1213   A   BC   INGA   CR   TWP 85-R SE 19   PNG from TOP of SURFACE to
BASE of CHARLIE LAKE A     INTLSVRN   90   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1213   A   BC   INGA   CR         THIRD
PARTY   10                 M1214   A   BC   INGA   CR   TWP 85-R NE 19   PNG
from TOP of SURFACE to BASE of CHARLIE LAKE A   100/16-19-085-23-W6/00  
INTLSVRN   90   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1214   A   BC   INGA   CR         THIRD PARTY   10   GOR  
  3   INTLSVRN   100   THIRD PARTY   100   ON 10.0000% PRODUCTION; NONCONV.
M1217   A   BC   CLARKE LAKE   CR   NTS 94-J-l 56, 57, 66,   PNG from TOP of
SURFACE to BASE of SLAVE POINT   d-066-G/094-J-10   INTLSVRN   9.375   LSR   S/S
    LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1217   A  
BC   CLARKE LAKE   CR         THIRD PARTY   78.125   GOR     1.5625   THIRD
PARTY   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1217   A   BC  
CLARKE LAKE   CR         THIRD PARTY   12.5                 M1217   B   BC  
CLARKE LAKE   CR   NTS 94-J-l 51, 61   PNG from TOP of SURFACE to BASE of SLAVE
POINT   a-061-F/094-J-10   INTLSVRN   18.75   LSR   S/S     LESSOR   100   ALL
WI   100   ON 100.0000% PRODUCTION; NONCONV. M1217   B   BC   CLARKE LAKE   CR  
NTS 94-J-l 60, 70       THIRD PARTY   58.75   GOR     1.5625   THIRD PARTY   100
  ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1217   B   BC   CLARKE LAKE
  CR         THIRD PARTY   22.5                 M1217   C   BC   CLARKE LAKE  
CR   NTS 94-J-l 58, 59, 68,   PNG from TOP of SURFACE to BASE of SLAVE POINT  
a-069-G/094-J-10   INTLSVRN   9.375   LSR   S/S     LESSOR   100   ALL WI   100
  ON 100.0000% PRODUCTION; NONCONV. M1217   C   BC   CLARKE LAKE   CR      
b-076-G/094-J-10   THIRD PARTY   78.125   GOR     1.5625   THIRD PARTY   100  
ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1217   C   BC   CLARKE LAKE  
CR         THIRD PARTY   12.5                 M1218   A   BC   CLARKE LAKE   CR
  NTS 94-J-l 74, 75, 84   PNG from TOP of SURFACE to BASE of SLAVE POINT  
a-074-G/094-J-10   INTLSVRN   16.66   LSR   S/S     LESSOR   100   ALL WI   100
  ON 100.0000% PRODUCTION; NONCONV. M1218   A   BC   CLARKE LAKE   CR      
b-074-G/094-J-10   THIRD PARTY   83.34   GOR     15   THIRD PARTY   100   ALLWI
  100   ON 17.5000% PRODUCTION; NONCONV. M1218   A   BC   CLARKE LAKE   CR      
b-084-G/094-J-10                     M1219   A   BC   CLARKE LAKE   CR   NTS
94-J-l 54, 55, 64,   PNG from TOP of SURFACE to BASE of SLAVE POINT  
c-054-F/094-J-10   INTLSVRN   18.75   LSR   S/S     LESSOR   100   ALL WI   100
  ON 100.0000% PRODUCTION; NONCONV. M1219   A   BC   CLARKE LAKE   CR        
THIRD PARTY   56.25   GOR     1.5625   THIRD PARTY   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV. M1219   A   BC   CLARKE LAKE   CR         THIRD
PARTY   25                 M1220   A   BC   CLARKE LAKE   CR   NTS 94-J-l 52,
53, 62,   PNG from TOP of SURFACE to BASE of SLAVE POINT   c-052-F/094-J-10  
INTLSVRN   25   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1220   A   BC   CLARKE LAKE   CR         THIRD PARTY   75
  GOR     1.5625   THIRD PARTY   100   ALL WI   100   ON 100.0000% PRODUCTION;
NONCONV. M1221   A   BC   CLARKE LAKE   CR   NTS 94-J-l 54, 55, 64,   PNG from
TOP of SURFACE to BASE of SLAVE POINT   d-054-G/094-J-10   INTLSVRN   16.66  
LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1221   A   BC   CLARKE LAKE   CR       a-065-G/094-J-10   THIRD PARTY   83.34  
GOR     15   THIRD PARTY   100   ALL WI   100   ON 17.5000% PRODUCTION; NONCONV.
M1222   A   BC   CLARKE LAKE   CR   NTS 94-J-l Unit 85   PNG from TOP of SURFACE
to BASE of SLAVE POINT     INTLSVRN   16.66   LSR   S/S     LESSOR   100   ALL
WI   100   ON 100.0000% PRODUCTION; NONCONV. M1222   A   BC   CLARKE LAKE   CR  
      THIRD PARTY   83.34   GOR     15   THIRD PARTY   100   ALL WI   17.5   ON
100.0000% PRODUCTION; NONCONV. M1223   A   BC   BOUNDARY LAKE   CR   TWP 84-R NW
7   PNG from TOP of SURFACE to BASE of BOUNDARY LAKE   100/14-07-084-13-W6/00  
INTLSVRN   1.216188   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1223   A   BC   BOUNDARY LAKE   CR         THIRD PARTY  
70.73033   GOR     2   THIRD PARTY   100   INTLSVRN   9.0645   ON 33.3330%
PRODUCTION; NONCONV. M1223   A   BC   BOUNDARY LAKE   CR         THIRD PARTY  
7.2915   CONT           THIRD PARTY   62.1905   M1223   A   BC   BOUNDARY LAKE  
CR         THIRD PARTY   8.3335   CONT           THIRD PARTY   21.875   M1223  
A   BC   BOUNDARY LAKE   CR         THIRD PARTY   0.206583   CONT          
THIRD PARTY   6.25   M1223   A   BC   BOUNDARY LAKE   CR         THIRD PARTY  
1.805396   CONT           THIRD PARTY   0.62   M1223   A   BC   BOUNDARY LAKE  
CR         THIRD PARTY   2.08325                 M1223   A   BC   BOUNDARY LAKE
  CR         THIRD PARTY   0                 M1223   A   BC   BOUNDARY LAKE   CR
        THIRD PARTY   4.166625                 M1223   A   BC   BOUNDARY LAKE  
CR         THIRD PARTY   0                 M1223   A   BC   BOUNDARY LAKE   CR  
      THIRD PARTY   4.166625                 M1223   A   BC   BOUNDARY LAKE   CR
        THIRD PARTY   0                 M1224   A   BC   BOUNDARY LAKE   CR  
TWP 84-RSW 7   PET from TOP of SURFACE to BASE of BOUNDARY LAKE  
100/06-07-084-14-W6/00   INTLSVRN   13.2896   LSR   S/S     LESSOR   100   ALL
WI   100   ON 100.0000% PRODUCTION; NONCONV. M1224   A   BC   BOUNDARY LAKE   CR
        THIRD PARTY   6.7857   GOR       THIRD PARTY   100   INTLSVRN   40.25  
0.7500% OIL; ON 33.0178% PRODUCTION; NONCONV. M1224   A   BC   BOUNDARY LAKE  
CR         THIRD PARTY   19.7282   CONT           THIRD PARTY   59.75   M1224  
A   BC   BOUNDARY LAKE   CR         THIRD PARTY   28.0536   GOR       THIRD
PARTY   100   INTLSVRN   40.25   1.2500% OIL; ON 33.0178% PRODUCTION; NONCONV.
M1224   A   BC   BOUNDARY LAKE   CR         THIRD PARTY   32.1429   CONT        
  THIRD PARTY   59.75   M1224   A   BC   BOUNDARY LAKE   CR         THIRD PARTY
  0   GOR       THIRD PARTY   100   INTLSVRN   21.76   S/S: 1/150.0000 (5.0000 -
15.0000%) OIL; 15.0000% GAS; ON 61.0714% PRODUCTION; CONV APO TO 30.5357000%
M1224   B   BC   BOUNDARY LAKE   CR   TWP 84-RSE 8   PET from TOP of SURFACE to
BASE of BOUNDARY LAKE   100/08-08-084-14-W6/00   INTLSVRN   6.6448   LSR   S/S  
  LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1224   B   BC
  BOUNDARY LAKE   CR         THIRD PARTY   9.8641   GOR       THIRD PARTY   100
  INTLSVRN   40.25   0.7500% OIL; ON 16.5089% PRODUCTION; NONCONV. M1224   B  
BC   BOUNDARY LAKE   CR         THIRD PARTY   32.1429   CONT           THIRD
PARTY   59.75   M1224   B   BC   BOUNDARY LAKE   CR         THIRD PARTY   6.7857
  GOR       THIRD PARTY   100   INTLSVRN   40.25   1.2500% OIL; ON 16.5089%
PRODUCTION; NONCONV. M1224   B   BC   BOUNDARY LAKE   CR         THIRD PARTY  
14.0268   CONT           THIRD PARTY   59.75   M1224   B   BC   BOUNDARY LAKE  
CR         THIRD PARTY   30.5357                 M1224   C   BC   BOUNDARY LAKE
  CR   TWP 84-RSW 9   PET from TOP of SURFACE to TOP of BOUNDARY LAKE    
INTLSVRN   8.0098   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1224   C   BC   BOUNDARY LAKE   CR         THIRD PARTY  
12.9376   GOR       THIRD PARTY   100   INTLSVRN   40.25   0.7500% OIL; ON
19.9000% PRODUCTION; NONCONV. M1224   C   BC   BOUNDARY LAKE   CR         THIRD
PARTY   25   CONT           THIRD PARTY   59.75   M1224   C   BC   BOUNDARY LAKE
  CR         THIRD PARTY   2.5   GOR       THIRD PARTY   100   INTLSVRN   40.25
  1.2500% OIL; ON 19.9000% PRODUCTION; NONCONV. M1224   C   BC   BOUNDARY LAKE  
CR         THIRD PARTY   30   CONT           THIRD PARTY   59.75   M1224   C  
BC   BOUNDARY LAKE   CR         THIRD PARTY   0                 M1224   C   BC  
BOUNDARY LAKE   CR         THIRD PARTY   0                 M1224   C   BC  
BOUNDARY LAKE   CR         THIRD PARTY   17.5                 M1224   C   BC  
BOUNDARY LAKE   CR         THIRD PARTY   4.0526                 M1224   D   BC  
BOUNDARY LAKE   CR   TWP 84-RSW 9   PET from TOP of BOUNDARY LAKE to BASE of
BOUNDARY LAKE   100/06-09-084-14-W6/00   INTLSVRN   8.0098   LSR   S/S    
LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1224   D   BC  
BOUNDARY LAKE   CR         THIRD PARTY   2.5   GOR       THIRD PARTY   100  
INTLSVRN   40.25   0.7500% OIL; ON 19.9000% PRODUCTION; NONCONV. M1224   D   BC
  BOUNDARY LAKE   CR         THIRD PARTY   6.875   CONT           THIRD PARTY  
59.75   M1224   D   BC   BOUNDARY LAKE   CR         THIRD PARTY   12.9376   GOR
      THIRD PARTY   100   INTLSVRN   40.25   1.2500% OIL; ON 19.9000%
PRODUCTION; NONCONV. M1224   D   BC   BOUNDARY LAKE   CR         THIRD PARTY  
30   CONT           THIRD PARTY   59.75   M1224   D   BC   BOUNDARY LAKE   CR  
      THIRD PARTY   28.75                 M1224   D   BC   BOUNDARY LAKE   CR  
      THIRD PARTY   6.015625                 M1224   D   BC   BOUNDARY LAKE   CR
        THIRD PARTY   0.859375                 M1224   D   BC   BOUNDARY LAKE  
CR         THIRD PARTY   0                 M1224   D   BC   BOUNDARY LAKE   CR  
      THIRD PARTY   0                 M1224   D   BC   BOUNDARY LAKE   CR      
  THIRD PARTY   4.0526                 M1225   A   BC   BOUNDARY LAKE   CR   TWP
84-RNE 5   PET from TOP of SURFACE to BASE of BOUNDARY LAKE  
100/16-05-084-14-W6/00   INTLSVRN   10.8704   LSR   S/S     LESSOR   100   ALL
WI   100   ON 100.0000% PRODUCTION; NONCONV. M1225   A   BC   BOUNDARY LAKE   CR
        THIRD PARTY   17.5581   GOR       THIRD PARTY   100   INTLSVRN   40.25  
0.7500% OIL; ON 27.0072% PRODUCTION; NONCONV. M1225   A   BC   BOUNDARY LAKE  
CR         THIRD PARTY   32.1429   CONT           THIRD PARTY   59.75   M1225  
A   BC   BOUNDARY LAKE   CR         THIRD PARTY   3.3929   GOR       THIRD PARTY
  100   INTLSVRN   40.25   1.2500% OIL; ON 27.0072% PRODUCTION; NONCONV. M1225  
A   BC   BOUNDARY LAKE   CR         THIRD PARTY   30.5357   CONT           IMPEL
  50.75   M1225   A   BC   BOUNDARY LAKE   CR         THIRD PARTY   0          
  THIRD PARTY     M1225   A   BC   BOUNDARY LAKE   CR         THIRD PARTY   0  
              M1225   A   BC   BOUNDARY LAKE   CR         THIRD PARTY   5.5    
            M1226   A   BC   BOUNDARY LAKE   CR   TWP 84-RSE 4   PET from TOP of
SURFACE to TOP of BOUNDARY LAKE     INTLSVRN   8.0098   LSR   S/S     LESSOR  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

                                                              M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   12.9376                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   25                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   2.5                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   30                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   0                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   0                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   17.5                 M1226   A   BC  
BOUNDARY LAKE   CR       THIRD PARTY   4.0526                 M1226   B   BC  
BOUNDARY LAKE   CR   TWP 84-RE 4 PET from TOP of BOUNDARY LAKE to BASE of
BOUNDARY LAKE     INTLSVRN   8.0098   LSR   S/S     LESSOR   100   ALL WI   100
  ON 100.0000% PRODUCTION; NONCONV. M1226   B   BC   BOUNDARY LAKE   CR      
THIRD PARTY   12.9376                 M1226   B   BC   BOUNDARY LAKE   CR      
THIRD PARTY   28.75                 M1226   B   BC   BOUNDARY LAKE   CR      
THIRD PARTY   2.5                 M1226   B   BC   BOUNDARY LAKE   CR      
THIRD PARTY   30                 M1226   B   BC   BOUNDARY LAKE   CR       THIRD
PARTY   0                 M1226   B   BC   BOUNDARY LAKE   CR       THIRD PARTY
  6.015625                 M1226   B   BC   BOUNDARY LAKE   CR       THIRD PARTY
  0.859375                 M1226   B   BC   BOUNDARY LAKE   CR       THIRD PARTY
  6.875                 M1226   B   BC   BOUNDARY LAKE   CR       THIRD PARTY  
0                 M1226   B   BC   BOUNDARY LAKE   CR       THIRD PARTY   4.0526
                M1228   A   BC   INGA   CR   TWP 85-RW 29 PNG from TOP of
SURFACE to BASE of CHARLIE LAKE A     THIRD PARTY   77.3   LSR   S/S     LESSOR
  100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1228   A   BC   INGA  
CR       THIRD PARTY   22.7   GOR     3   INTLSVRN   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV. M1230   A   AB   MEDICINE RIVER   CR   TWP 38-RNE
30 PNG to BASE of MANNVILLE excluding NG to BASE of BELLY RIVER  
100/16-30-038-02-W5/00   INTLSVRN   65   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1230   A   AB   MEDICINE RIVER   CR    
100/05-30-038-02-W5/00   THIRD PARTY   33.5   GOR     10   THIRD PARTY   100  
ALL WI   100   ON 30.0000% PRODUCTION; CONV APO TO 10.0000000% M1230   A   AB  
MEDICINE RIVER   CR     102/05-30-038-02-W5/00   THIRD PARTY   0.5              
  M1230   A   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5                
M1230   A   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5                
M1230   A   AB   MEDICINE RIVER   CR       THIRD PARTY   0                 M1230
  B   AB   MEDICINE RIVER   CR   TWP 38-RS & NW 30 PNG to BASE of MANNVILLE
excluding NG to BASE of BELLY RIVER   100/05-30-038-02-W5/00   INTLSVRN   62.769
  LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1230   B   AB   MEDICINE RIVER   CR     102/05-30-038-02-W5/00   THIRD PARTY  
25.731                 M1230   B   AB   MEDICINE RIVER   CR       THIRD PARTY  
10                 M1230   B   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5
                M1230   B   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5    
            M1230   B   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5        
        M1230   C   AB   MEDICINE RIVER   CR   TWP 38-RNE 30 NG to BASE of BELLY
RIVER excluding NG in the EDMONTON SAND   100/05-30-038-02-W5/00   INTLSVRN   91
  LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1230   C   AB   MEDICINE RIVER   CR       THIRD PARTY   7.5   GOR       THIRD
PARTY   100   ALL WI   100   3.0000% GAS; ON 100.0000% PRODUCTION; CONV APO
16-30 TO 10.0000000% M1230   C   AB   MEDICINE RIVER   CR       THIRD PARTY   0
  GOR       THIRD PARTY   100   INTLSVRN   100   15.0000% GAS; ON 27.6732%
PRODUCTION; CONV APO 5-30 TO 13.8366000% M1230   C   AB   MEDICINE RIVER   CR  
    THIRD PARTY   0.5                 M1230   C   AB   MEDICINE RIVER   CR      
THIRD PARTY   0.5                 M1230   C   AB   MEDICINE RIVER   CR      
THIRD PARTY   0.5                 M1230   D   AB   MEDICINE RIVER   CR   TWP
38-RS&NW 30 NG to BASE of BELLY RIVER excluding NG in the EDMONTON SAND  
100/05-30-038-02-W5/00   INTLSVRN   91   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1230   D   AB   MEDICINE RIVER   CR    
  THIRD PARTY   7.5   GOR       THIRD PARTY   100   INTLSVRN   100   S/S:
1/23.8365 (5.0000 - 15.0000%) OIL; 15.0000% GAS; ON 27.6732% PRODUCTION; CONV
APO 5-30 TO 13.8366000% M1230   D   AB   MEDICINE RIVER   CR       THIRD PARTY  
0                 M1230   D   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5  
              M1230   D   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5      
          M1230   D   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5          
      M1230   E   AB   MEDICINE RIVER   CR   TWP 38-RNE 30 NG from TOP of
EDMONTON SAND to BASE of EDMONTON SAND   100/05-30-038-02-W5/00   INTLSVRN   91
  LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1230   E   AB   MEDICINE RIVER   CR     102/05-30-038-02-W5/00   THIRD PARTY  
7.5   GOR       THIRD PARTY   100   INTLSVRN   100   3.0000% GAS; ON 100.0000%
PRODUCTION; CONV APO 16-30 TO 10.0000000% M1230   E   AB   MEDICINE RIVER   CR  
    THIRD PARTY   0.5   GOR       THIRD PARTY   100   INTLSVRN   100   15.0000%
GAS; ON 27.6732% PRODUCTION; NONCONV. M1230   E   AB   MEDICINE RIVER   CR      
THIRD PARTY   0.5                 M1230   E   AB   MEDICINE RIVER   CR      
THIRD PARTY   0.5                 M1230   F   AB   MEDICINE RIVER   CR   TWP
38-R S & NW 30 NG from TOP of EDMONTON SAND to BASE of EDMONTON SAND  
100/05-30-038-02-W5/00   INTLSVRN   91   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV. M1230   F   AB   MEDICINE RIVER   CR    
102/05-30-038-02-W5/00   THIRD PARTY   7.5   GOR       THIRD PARTY   100  
INTLSVRN   100   15.0000% GAS; ON 27.6732% PRODUCTION; NONCONV. M1230   F   AB  
MEDICINE RIVER   CR       THIRD PARTY   0.5                 M1230   F   AB  
MEDICINE RIVER   CR       THIRD PARTY   0.5                 M1230   F   AB  
MEDICINE RIVER   CR       THIRD PARTY   0.5                 M1231   A   AB  
MEDICINE RIVER   FH   TWP 38-RE SE 25 (PTN PNG to BASEMENT Exlcuding NG in the
Basal Quartz and P&NG in the Cardium.   102/02-25-038-03-W5/00   INTLSVRN   70.5
  LSR     18   THIRD PARTY   100   ALL WI   100   ON 100.0000% PRODUCTION;
NONCONV. M1231   A   AB   MEDICINE RIVER   FH       THIRD PARTY   8.5   GOR    
5   THIRD PARTY   100   INTLSVRN   81.0345   ON 100.0000% PRODUCTION; NONCONV.
M1231   A   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85   CONT          
THIRD PARTY   9.7701   M1231   A   AB   MEDICINE RIVER   FH       THIRD PARTY  
5.85   CONT           THIRD PARTY   5.1725   M1231   A   AB   MEDICINE RIVER  
FH       THIRD PARTY   0   CONT           THIRD PARTY   1.1494   M1231   A   AB
  MEDICINE RIVER   FH       THIRD PARTY   4.5   CONT           THIRD PARTY  
0.5747   M1231   A   AB   MEDICINE RIVER   FH       THIRD PARTY   1   CONT      
    THIRD PARTY   0.5747   M1231   A   AB   MEDICINE RIVER   FH       THIRD
PARTY   0.5   CONT           THIRD PARTY   0.5747   M1231   A   AB   MEDICINE
RIVER   FH       THIRD PARTY   0.5   CONT           THIRD PARTY   1.1494   M1231
  A   AB   MEDICINE RIVER   FH       THIRD PARTY   0.5   GOR     2   THIRD PARTY
  100   INTLSVRN   81.0345   ON 100.0000% PRODUCTION; NONCONV. M1231   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   1   CONT           THIRD PARTY   9.7701
  M1231   A   AB   MEDICINE RIVER   FH       THIRD PARTY   1.3   CONT          
THIRD PARTY   5.1725   M1231   A   AB   MEDICINE RIVER   FH       THIRD PARTY  
0   CONT           THIRD PARTY   1.1494   M1231   B   AB   MEDICINE RIVER   FH  
TWP 38-RSE 25 (PTN NG from TOP of BASAL QUARTZ to BASE of BASAL QUARTZ  
100/02-25-038-03-W5/00   INTLSVRN   62   LSR     18   THIRD PARTY   100   ALLWI
  100   ON 100.0000% PRODUCTION; NONCONV. M1231   B   AB   MEDICINE RIVER   FH  
  100/02-25-038-03-W5/02   THIRD PARTY   8.5   GOR     5   THIRD PARTY   100  
INTLSVRN   81.0345   ON 100.0000% PRODUCTION; NONCONV. M1231   B   AB   MEDICINE
RIVER   FH       THIRD PARTY   5.85   CONT           THIRD PARTY   9.7701  
M1231   B   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85   CONT          
THIRD PARTY   5.1725   M1231   B   AB   MEDICINE RIVER   FH       THIRD PARTY  
8.5   CONT           THIRD PARTY   1.1494   M1231   B   AB   MEDICINE RIVER   FH
      THIRD PARTY   4.5   CONT           THIRD PARTY   0.5747   M1231   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   1   CONT           THIRD PARTY   0.5747
  M1231   B   AB   MEDICINE RIVER   FH       THIRD PARTY   0.5   CONT          
THIRD PARTY   0.5747   M1231   B   AB   MEDICINE RIVER   FH       THIRD PARTY  
0.5   CONT           THIRD PARTY   1.1494   M1231   B   AB   MEDICINE RIVER   FH
      THIRD PARTY   0.5   GOR     2   THIRD PARTY   100   INTLSVRN   81.0345  
ON 100.0000% PRODUCTION; NONCONV. M1231   B   AB   MEDICINE RIVER   FH      
THIRD PARTY   1   CONT           THIRD PARTY   9.7701   M1231   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   1.3   CONT           THIRD PARTY  
5.1725   M1231   C   AB   MEDICINE RIVER   FH   TWP 38-RSE 25 (PTN PNG from TOP
of CARDIUM to BASE of CARDIUM     INTLSVRN   70.5   LSR     18   THIRD PARTY  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1231   C   AB   MEDICINE
RIVER   FH       THIRD PARTY   8.5   GOR     5   THIRD PARTY   100   INTLSVRN  
81.0345   ON 100.0000% PRODUCTION; NONCONV. M1231   C   AB   MEDICINE RIVER   FH
      THIRD PARTY   5.85   CONT           THIRD PARTY   9.7701   M1231   C   AB
  MEDICINE RIVER   FH       THIRD PARTY   5.85   CONT           THIRD PARTY  
5.1725   M1231   C   AB   MEDICINE RIVER   FH       THIRD PARTY   0   CONT      
    THIRD PARTY   1.1494   M1231   C   AB   MEDICINE RIVER   FH       THIRD
PARTY   4.5   CONT           THIRD PARTY   0.5747   M1231   C   AB   MEDICINE
RIVER   FH       THIRD PARTY   1   CONT           THIRD PARTY   0.5747   M1231  
C   AB   MEDICINE RIVER   FH       THIRD PARTY   0.5   CONT           THIRD
PARTY   0.5747   M1231   C   AB   MEDICINE RIVER   FH       THIRD PARTY   0.5  
CONT           THIRD PARTY   1.1494   M1231   C   AB   MEDICINE RIVER   FH      
THIRD PARTY   0.5   GOR     2   THIRD PARTY   100   INTLSVRN   81.0345   ON
100.0000% PRODUCTION; NONCONV. M1231   C   AB   MEDICINE RIVER   FH       THIRD
PARTY   1   CONT           THIRD PARTY   9.7701   M1231   C   AB   MEDICINE
RIVER   FH       THIRD PARTY   1.3   CONT           THIRD PARTY   5.1725   M1232
  A   AB   MEDICINE RIVER   CR   TWP 38-RSE 25 (PTN PNG BASE of VIKING to BASE
of MANNVILLE excluding NG in the BASAL QUARTZ   102/02-25-038-03-W5/00  
INTLSVRN   70.5   LSR   S/S     LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1232   A   AB   MEDICINE RIVER   CR       THIRD PARTY  
8.5   GOR     5   THIRD PARTY   100   INTLSVRN   81.0345   ON 100.0000%
PRODUCTION; NONCONV. M1232   A   AB   MEDICINE RIVER   CR       THIRD PARTY  
5.85   CONT           THIRD PARTY   9.7701  

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

                                                              M1232   A   AB  
MEDICINE RIVER   CR       THIRD PARTY   5.85   CONT           THIRD PARTY  
5.1725   M1232   A   AB   MEDICINE RIVER   CR       THIRD PARTY   0   CONT      
    THIRD PARTY   1.1494   M1232   A   AB   MEDICINE RIVER   CR       THIRD
PARTY   4.5   CONT           THIRD PARTY   0.5747   M1232   A   AB   MEDICINE
RIVER   CR       THIRD PARTY   1   CONT           THIRD PARTY   0.5747   M1232  
A   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5   CONT           THIRD
PARTY   0.5747   M1232   A   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5  
CONT           THIRD PARTY   1.1494   M1232   A   AB   MEDICINE RIVER   CR      
THIRD PARTY   0.5   GOR     2   THIRD PARTY   100   INTLSVRN   81.0345   ON
100.0000% PRODUCTION; NONCONV. M1232   A   AB   MEDICINE RIVER   CR       THIRD
PARTY   1   CONT           THIRD PARTY   9.7701   M1232   A   AB   MEDICINE
RIVER   CR       THIRD PARTY   1.3   CONT           THIRD PARTY   5.1725   M1232
  B   AB   MEDICINE RIVER   CR   TWP 38-R( SE 25 (PTN NG from TOP of BASAL
QUARTZ to BASE of BASAL QUARTZ   100/02-25-038-03-W5/00   INTLSVRN   62   LSR  
S/S     LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1232  
B   AB   MEDICINE RIVER   CR     100/02-25-038-03-W5/02   THIRD PARTY   8.5  
GOR     5   THIRD PARTY   100   INTLSVRN   81.0345   ON 100.0000% PRODUCTION;
NONCONV. M1232   B   AB   MEDICINE RIVER   CR       THIRD PARTY   5.85   CONT  
        THIRD PARTY   9.7701   M1232   B   AB   MEDICINE RIVER   CR       THIRD
PARTY   5.85   CONT           THIRD PARTY   5.1725   M1232   B   AB   MEDICINE
RIVER   CR       THIRD PARTY   8.5   CONT           THIRD PARTY   1.1494   M1232
  B   AB   MEDICINE RIVER   CR       THIRD PARTY   4.5   CONT           THIRD
PARTY   0.5747   M1232   B   AB   MEDICINE RIVER   CR       THIRD PARTY   1  
CONT           THIRD PARTY   0.5747   M1232   B   AB   MEDICINE RIVER   CR      
THIRD PARTY   0.5   CONT           THIRD PARTY   0.5747   M1232   B   AB  
MEDICINE RIVER   CR       THIRD PARTY   0.5   CONT           THIRD PARTY  
1.1494   M1232   B   AB   MEDICINE RIVER   CR       THIRD PARTY   0.5   GOR    
2   THIRD PARTY   100   INTLSVRN   81.0345   ON 100.0000% PRODUCTION; NONCONV.
M1232   B   AB   MEDICINE RIVER   CR       THIRD PARTY   1   CONT          
THIRD PARTY   9.7701   M1232   B   AB   MEDICINE RIVER   CR       THIRD PARTY  
1.3   CONT           THIRD PARTY   5.1725   M1233   A   AB   MEDICINE RIVER   FH
  TWP 38-R( SW 25 (PTI NG from TOP of BASAL QUARTZ to BASE of BASAL QUARTZ  
100/02-25-038-03-W5/00   INTLSVRN   46.5   LSR     25   LESSOR   100   THIRD
PARTY   50   ON 100.0000% PRODUCTION; NONCONV. M1233   A   AB   MEDICINE RIVER  
FH     100/02-25-038-03-W5/02   THIRD PARTY   0.75   CONT           THIRD PARTY
  50   M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   6.375          
      M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   0.375            
    M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   0.375              
  M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   17.375              
  M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   17.375              
  M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   0.375                
M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   6.375                
M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   3.375                
M1233   A   AB   MEDICINE RIVER   FH       THIRD PARTY   0.75                
M1234   A   AB   MEDICINE RIVER   FH   TWP 38-RE NE 25 PNG to BASEMENT Excluding
NG in the Basal Quartz and P&NG in the Cardium   102/02-25-038-03-W5/00  
INTLSVRN   70.5   LSR     18.5   LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1234   A   AB   MEDICINE RIVER   FH       THIRD PARTY  
8.5   GOR       THIRD PARTY   100   INTLSVRN   100   S/S: 1/150.0000 (5.0000 -
15.0000%) OIL; 15.0000% GAS; ON 8.5000% PRODUCTION; CONV APO TO 4.2500000% M1234
  A   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85                 M1234  
A   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85                 M1234   A
  AB   MEDICINE RIVER   FH       THIRD PARTY   0                 M1234   A   AB
  MEDICINE RIVER   FH       THIRD PARTY   4.5                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   1                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   1                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   1.3                 M1234   A   AB  
MEDICINE RIVER   FH       THIRD PARTY   0                 M1234   B   AB  
MEDICINE RIVER   FH   TWP 38-R( NE 25 NG from TOP of BASAL QUARTZ to BASE of
BASAL QUARTZ   100/02-25-038-03-W5/00   INTLSVRN   62   LSR     18.5   LESSOR  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1234   B   AB   MEDICINE
RIVER   FH     100/02-25-038-03-W5/02   THIRD PARTY   8.5                 M1234
  B   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85                 M1234  
B   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85                 M1234   B
  AB   MEDICINE RIVER   FH       THIRD PARTY   8.5                 M1234   B  
AB   MEDICINE RIVER   FH       THIRD PARTY   4.5                 M1234   B   AB
  MEDICINE RIVER   FH       THIRD PARTY   1                 M1234   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   1                 M1234   B   AB  
MEDICINE RIVER   FH       THIRD PARTY   1.3                 M1234   C   AB  
MEDICINE RIVER   FH   TWP 38-R( NE 25 PNG from TOP of CARDIUM to BASE of CARDIUM
    INTLSVRN   70.5   LSR     18.5   LESSOR   100   ALL WI   100   ON 100.0000%
PRODUCTION; NONCONV. M1234   C   AB   MEDICINE RIVER   FH       THIRD PARTY  
8.5   GOR       THIRD PARTY   100   INTLSVRN   100   S/S: 1/150.0000 (5.0000 -
15.0000%) OIL; 15.0000% GAS; ON 8.5000% PRODUCTION; CONV APO TO 4.2500000% M1234
  C   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85                 M1234  
C   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85                 M1234   C
  AB   MEDICINE RIVER   FH       THIRD PARTY   0                 M1234   C   AB
  MEDICINE RIVER   FH       THIRD PARTY   4.5                 M1234   C   AB  
MEDICINE RIVER   FH       THIRD PARTY   1                 M1234   C   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   C   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   C   AB  
MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1234   C   AB  
MEDICINE RIVER   FH       THIRD PARTY   1                 M1234   C   AB  
MEDICINE RIVER   FH       THIRD PARTY   1.3                 M1235   A   AB  
MEDICINE RIVER   FH   TWP 38-R( NW 25 PNG to BASEMENT Excluding NG in the Basal
Quartz and P&NG in the Cardium   102/02-25-038-03-W5/00   INTLSVRN   70.5   LSR
    18.5   LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. M1235
  A   AB   MEDICINE RIVER   FH       THIRD PARTY   1   GOR       THIRD PARTY  
100   INTLSVRN   100   S/S: 1/150.0000 (5.0000 - 15.0000%) OIL; 15.0000% GAS; ON
8.5000% PRODUCTION; CONV APO TO 4.2500000% M1235   A   AB   MEDICINE RIVER   FH
      THIRD PARTY   8.5                 M1235   A   AB   MEDICINE RIVER   FH    
  THIRD PARTY   0.5                 M1235   A   AB   MEDICINE RIVER   FH      
THIRD PARTY   0.5                 M1235   A   AB   MEDICINE RIVER   FH      
THIRD PARTY   5.85                 M1235   A   AB   MEDICINE RIVER   FH      
THIRD PARTY   5.85                 M1235   A   AB   MEDICINE RIVER   FH      
THIRD PARTY   0                 M1235   A   AB   MEDICINE RIVER   FH       THIRD
PARTY   4.5                 M1235   A   AB   MEDICINE RIVER   FH       THIRD
PARTY   1                 M1235   A   AB   MEDICINE RIVER   FH       THIRD PARTY
  1.3                 M1235   A   AB   MEDICINE RIVER   FH       THIRD PARTY  
0.5                 M1235   A   AB   MEDICINE RIVER   FH       THIRD PARTY   0  
              M1235   B   AB   MEDICINE RIVER   FH   TWP 38-R( NW 25 NG from TOP
of BASAL QUARTZ to BASE of BASAL QUARTZ   100/02-25-038-03-W5/00   INTLSVRN   62
  LSR     18.5   LESSOR   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.
M1235   B   AB   MEDICINE RIVER   FH     100/02-25-038-03-W5/02   THIRD PARTY  
1                 M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   8.5  
              M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   0.5      
          M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   0.5          
      M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85            
    M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   5.85              
  M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   8.5                
M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   4.5                
M1235   B   AB   MEDICINE RIVER   FH       THIRD PARTY   1                 M1235
  B   AB   MEDICINE RIVER   FH       THIRD PARTY   1.3                 M1235   B
  AB   MEDICINE RIVER   FH       THIRD PARTY   0.5                 M1235   C  
AB   MEDICINE RIVER   FH   TWP 38-R( NW 25 PNG from TOP of CARDIUM to BASE of
CARDIUM     INTLSVRN   70.5   LSR     18.5   LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

M1235

  C     AB      MEDICINE RIVER   FH        

THIRD

PARTY

    1      GOR       THIRD PARTY     100      INTLSVRN   100   S/S: 1/150.0000
(5.0000 - 15.0000%) OIL; 15.0000% GAS; ON 8.5000% PRODUCTION; CONV APO TO
4.2500000%

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     8.5                 
 

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     0.5                 
 

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     0.5                 
 

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     5.85               
   

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     5.85               
   

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     0                   

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     4.5                 
 

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     1                   

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     1.3                 
 

M1235

  C     AB      MEDICINE RIVER   FH         THIRD PARTY     0.5                 
 

M1237

  A     AB      MEDICINE RIVER   CR   TWP 38-RNW 25 (PT   PNG to BASE of
MANNVILLE Excluding NG in the Basal Quartz and P&NG in the Cardium  
102/02-25-038-03-W5/00   INTLSVRN     70.5      LSR   S/S     LESSOR     100   
  ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     8.5      GOR      
THIRD PARTY     100      INTLSVRN   100   S/S: 1/150.0000 (5.0000 - 15.0000%)
OIL; 15.0000% GAS; ON 8.5000% PRODUCTION; CONV APO TO 4.2500000%

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     5.85               
   

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     5.85               
   

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     0                   

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     4.5                 
 

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     1                   

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     1                   

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     1.3                 
 

M1237

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     0                   

M1237

  B     AB      MEDICINE RIVER   CR   TWP 38-RNW 25 (PT   NG from TOP of BASAL
QUARTZ to BASE of BASAL QUARTZ   100/02-25-038-03-W5/00   INTLSVRN     62     
LSR   S/S     LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION;
NONCONV.

M1237

  B     AB      MEDICINE RIVER   CR       100/02-25-038-03-W5/02   THIRD PARTY  
  8.5                   

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     5.85               
   

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     5.85               
   

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     8.5                 
 

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     4.5                 
 

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     1                   

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     1                   

M1237

  B     AB      MEDICINE RIVER   CR         THIRD PARTY     1.3                 
 

M1237

  C     AB      MEDICINE RIVER   CR   TWP 38-RNW 25 (PT   PNG from TOP of
CARDIUM to BASE of CARDIUM     THIRD PARTY     70.5      LSR   S/S     LESSOR  
  100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     8.5      GOR      
THIRD PARTY     100      INTLSVRN   100   S/S: 1/150.0000 (5.0000 - 15.0000%)
OIL; 15.0000% GAS; ON 8.5000% PRODUCTION; CONV APO TO 4.2500000%

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     5.85               
   

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     5.85               
   

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     0                   

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     4.5                 
 

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     1                   

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     0.5                 
 

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     1                   

M1237

  C     AB      MEDICINE RIVER   CR         THIRD PARTY     1.3                 
 

M1238

  A     AB      MEDICINE RIVER   CR   TWP 38-R ( NW 36   PNG from TOP of SURFACE
to BASE of BELLY RIVER   103/10-36-038-03-W5/00   ENERPLUS     50      LSR   S/S
    LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1238

  A     AB      MEDICINE RIVER   CR         THIRD PARTY     50      GOR      
INTLSVRN     33.785      ALL Wl   100   S/S: 1/150.0000 (5.0000 - 10.0000%) OIL;
10.0000% GAS; ON 100.0000% PRODUCTION; NONCONV

M1238

  B     AB      MEDICINE RIVER   CR   TWP 38-R ( NW 36   PNG from BASE of BELLY
RIVER to BASE of MANNVILLE   00/13-36-038-03-W5/00   THIRD PARTY     100     
LSR   S/S     LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION;
NONCONV.

M1246

  A     AB      RAINBOW   CR   TWP108-R NW 28   PNG from TOP of SURFACE to BASE
of SLAVE POINT     INTLSVRN     15      LSR   S/S     LESSOR     100      ALL Wl
  100   ON 100.0000% PRODUCTION; NONCONV.

M1246

  A     AB      RAINBOW   CR         THIRD PARTY     85                   

M1247

  A     AB      MEDICINE RIVER   FH   TWP 38-RSE 31   NG from TOP of SURFACE to
BASE of BASEMENT   100/01-31-038-02-W5/00   INTLSVRN     100      LSR       17
     LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1247

  A     AB      MEDICINE RIVER   FH       102/06-31-038-02-W5/00       GOR      
1.5      THIRD PARTY     100      ALL Wl   100   ON 100.0000% PRODUCTION;
NONCONV.

M1248

  A     AB      MEDICINE RIVER   FH   TWP 38-RNW 31   NG from TOP of SURFACE to
BASE of BASEMENT   100/01-31-038-02-W5/00   INTLSVRN     100      GOR       1.5
     THIRD PARTY     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1248

  A     AB      MEDICINE RIVER   FH       102/06-31-038-02-W5/00       LSR      
17      LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1249

  A     AB      MEDICINE RIVER   FH   TWP 38-RSE 31   NG from TOP of SURFACE to
BASE of BASEMENT   100/01-31-038-02-W5/00   INTLSVRN     100      GOR       1.5
     THIRD PARTY     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1249

  A     AB      MEDICINE RIVER   FH       102/06-31-038-02-W5/00       LSR      
17      LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1250

  A     AB      MEDICINE RIVER   FH   TWP 38-RSE 31   NG from TOP of SURFACE to
BASE of BASEMENT   100/01-31-038-02-W5/00   INTLSVRN     100      GOR       1.5
     THIRD PARTY     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1250

  A     AB      MEDICINE RIVER   FH       102/06-31-038-02-W5/00       LSR      
17      LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1252

  A     AB      MEDICINE RIVER   FH   TWP 38-RNE 31   NG from TOP of SURFACE to
BASE of BASEMENT   100/01-31-038-02-W5/00   INTLSVRN     100      LSR       12.5
     THIRD PARTY     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1252

  A     AB      MEDICINE RIVER   FH       102/06-31-038-02-W5/00       LSR      
7.5      THIRD PARTY     100      ALL Wl   100   ON 100.0000% PRODUCTION;
NONCONV.

M1254

  A     AB      LITTLE BOW   CR   TWP 14-RS 25   NG from TOP of SURFACE to BASE
of BOW ISLAND   100/15-25-014-21-W4/00   INTLSVRN     50      LSR   S/S    
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1254

  A     AB      LITTLE BOW   CR         THIRD PARTY     50                   

M1255

  A     BC      FT. ST. JOHN   CR   TWP 83-R 5   PNG from TOP of BELLOY to BASE
of BELLOY   100/14-05-083-18-W6/00   INTLSVRN     7.5      LSR   S/S     LESSOR
    100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1255

  A     BC      FT. ST. JOHN   CR         THIRD PARTY     92.5      GOR       10
     THIRD PARTY     100      ALL Wl   100   ON 50.0000% PRODUCTION; NONCONV.

M1257

  A     BC      MAPLE   CR   NTS 94-A-118, 19, 28,   PNG from TOP of BALDONNEL
to BASE of BALDONNEL   C-018-E/094-A-15   THIRD PARTY     50      LSR   S/S    
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1257

  A     BC      MAPLE   CR         INTLSVRN     50      GOR       10      THIRD
PARTY     100      INTLSVRN   100   ON 50.0000% PRODUCTION; NONCONV.

M1258

  A     AB      PREVO   FH   TWP 39-R21 (LSD 3)   NG from TOP of SURFACE to BASE
of BASEMENT   102/06-21-039-01-W5/00   INTLSVRN     100      LSR       LESSOR  
  100      ALL Wl   100   20.0000% GAS; ON 100.0000% PRODUCTION; NONCONV.

M1259

  A     AB      PREVO   FH   TWP 39-R21 (LSD4)   NG from TOP of SURFACE to BASE
of BASEMENT   102/06-21-039-01-W5/00   INTLSVRN     100      LSR       LESSOR  
  100      ALL Wl   100   20.0000% GAS; ON 100.0000% PRODUCTION; NONCONV.

M1277

  A     AB      PREVO   FH   TWP 39-RE 21   NG from TOP of SURFACE to BASE of
BASEMENT   102/06-21-039-01-W5/00   INTLSVRN     100      LSR       THIRD PARTY
    100      ALL Wl   100   12.5000% GAS; ON 100.0000% PRODUCTION; NONCONV.

M1299

  A     AB      ANTE CREEK   CR   TWP 67-R 9   PNG from BASE of PEACE RIVER to
BASE of TRIASSIC     INTLSVRN     25      LSR   S/S     LESSOR     100      ALL
Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1299

  A     AB      ANTE CREEK   CR         THIRD PARTY     57.191      GOR       10
     THIRD PARTY     28.764      INTLSVRN   100   ON 25.0000% PRODUCTION;
NONCONV.

M1299

  A     AB      ANTE CREEK   CR         THIRD PARTY     17.809      CONT      
THIRD PARTY     71.236         

M1322

  A     AB      PREVO   FH   TWP 39-R21 (LSDS 5   NG from TOP of SURFACE to BASE
of BASEMENT   102/06-21-039-01-W5/00   INTLSVRN     100      LSR       18     
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1331

  A     AB      LITTLE BOW   FH   TWP 14-R 36   NG from TOP of SURFACE to BASE
of COLORADO GROUP   100/07-36-014-21-W4/00   INTLSVRN     50      LSR      
LESSOR     100      ALL Wl   100   18.0000% GAS; ON 100.0000% PRODUCTION;
NONCONV.

M1331

  A     AB      LITTLE BOW   FH         THIRD PARTY     50                   

M1332

  A     AB      LITTLE BOW   FH   TWP 14-R 25   NG from TOP of SURFACE to BASE
of COLORADO GROUP   100/15-25-014-21-W4/00   INTLSVRN     50      LSR      
LESSOR     100      ALL Wl   100   18.0000% GAS; ON 100.0000% PRODUCTION;
NONCONV.

M1332

  A     AB      LITTLE BOW   FH         THIRD PARTY     50                   

M1333

  A     AB      LACOMBE   CR   TWP 43-RSE 2   PNG from BASE of EDMONTON SAND to
BASE of MANNVILLE   00/10-02-043-25-W4/00   INTLSVRN     50      LSR   S/S    
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1333

  A     AB      LACOMBE   CR         THIRD PARTY     35      GOR       1.5     
THIRD PARTY     100      INTLSVRN   58.824   ON 85.0000% PRODUCTION; NONCONV.

M1333

  A     AB      LACOMBE   CR         THIRD PARTY     15      CONT          
THIRD PARTY   41.176  

M1333

  A     AB      LACOMBE   CR         THIRD PARTY     0                   

M1334

  A     AB      LACOMBE   CR   TWP 43-RSW 2   PNG from BASE of EDMONTON SAND to
BASE of MANNVILLE   00/10-02-043-25-W4/00   INTLSVRN     50      LSR   S/S    
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1334

  A     AB      LACOMBE   CR         THIRD PARTY     35      GOR       1.5     
THIRD PARTY     100      INTLSVRN   58.824   ON 85.0000% PRODUCTION; NONCONV.

M1334

  A     AB      LACOMBE   CR         THIRD PARTY     15      CONT          
THIRD PARTY   41.176  

M1334

  A     AB      LACOMBE   CR         THIRD PARTY     0                   

M1335

  A     AB      LACOMBE   CR   TWP 43-RNW 2   PNG from BASE of EDMONTON SAND to
BASE of MANNVILLE   00/10-02-043-25-W4/00   INTLSVRN     50      LSR   S/S    
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1335

  A     AB      LACOMBE   CR         THIRD PARTY     35      GOR       1.5     
THIRD PARTY     100      INTLSVRN   58.824   ON 85.0000% PRODUCTION; NONCONV.

M1335

  A     AB      LACOMBE   CR         THIRD PARTY     15      CONT          
THIRD PARTY   41.176  

M1335

  A     AB      LACOMBE   CR         THIRD PARTY     0                   

M1336

  A     AB      LACOMBE   CR   TWP 43-RNE 2   PNG from BASE of EDMONTON SAND to
BASE of MANNVILLE   00/10-02-043-25-W4/00   INTLSVRN     50      LSR   S/S    
LESSOR     100      ALL Wl   100   ON 100.0000% PRODUCTION; NONCONV.

M1336

  A     AB      LACOMBE   CR         THIRD PARTY     35      GOR       1.5     
THIRD PARTY     100      INTLSVRN   58.824   ON 85.0000% PRODUCTION; NONCONV.

M1336

  A     AB      LACOMBE   CR         THIRD PARTY     15      CONT          
THIRD PARTY   41.176  

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

M1336

  A   AB   LACOMBE   CR           THIRD PARTY   0                

M1352

  A   AB   HAYS   CR   TWP 13-RN 35     PNG from TOP of SURFACE to BASE of BOW
ISLAND   100/06-35-013-16-W4/02   INTLSVRN   100   LSR   S/S     LESSOR   100  
ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1356

  A   AB   BERWYN   CR   TWP 82-R   11   PNG from TOP of SURFACE to BASE of
SPIRIT RIVER   100/02-11-082-24-W5/00     INTLSVRN   100   LSR   S/S     LESSOR
  100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1356

  A   AB   BERWYN   CR         100/07-11-082-24-W5/00       GOR     1.25   THIRD
PARTY     100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1371

  A   AB  

MEDICINE

RIVER

  CR   TWP 38-R 32 (LSDS   1   NG from TOP of LEDUC to BASE of LEDUC  
100/14-32-038-03-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV.

M1371

  A   AB   MEDICINE RIVER   CR           THIRD PARTY   0   GOR     1.5   THIRD
PARTY   100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1393

  A   AB   BOUNDARY LK   CR   TWP 83-R   8   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   40   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1393

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   53   ON 100.0000% PRODUCTION; NONCONV.

M1393

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT          
THIRD PARTY   34  

M1393

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   6.5  

M1394

  A   AB   BOUNDARY LK   CR   TWP 83-R   17   PNG from TOP of SURFACE to BASE of
BASEMENT   100/07-17-083-12-W6/04   INTLSVRN   40   LSR   S/S     LESSOR   100  
ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1394

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   53   ON 100.0000% PRODUCTION; NONCONV.

M1394

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   34  

M1394

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   6.5  

M1407

  A   AB   MEDICINE RIVER   CR   TWP 38-R N & SE 22     PNG from BASE of PEKISKO
to BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI  
100   ON 100.0000% PRODUCTION; NONCONV.

M1408

  A   AB   BRAZEAU   CR   TWP 46-R   9   PNG from BASE of CARDIUM to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1409

  A   AB   MEEKWAP   CR   TWP 66-R     5 PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   25   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1409

  A   AB   MEEKWAP   CR           THIRD PARTY   75   GOR     2   THIRD PARTY  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1410

  A   AB   MEEKWAP   CR   TWP 66-R   7   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   25   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1410

  A   AB   MEEKWAP   CR           THIRD PARTY   75   GOR     2   THIRD PARTY  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1413

  A   AB   GREENCOURT   CR   TWP 59-R S 27     PNG from TOP of SURFACE to BASE
of VIKING   100/03-27-059-10-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100
  ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty

M1413

  A   AB   GREENCOURT   CR           THIRD PARTY   0   GOR       THIRD PARTY  
70   ALL WI   100   S/S: 1/150.0000 10.0000 - 15.0000%) OIL; 15.0000% GAS; ON
100.0000% PRODUCTION; CONV APO TO 40.0000000%

M1413

  A   AB   GREENCOURT   CR           THIRD PARTY   0   CONT       THIRD PARTY  
30      

M1414

  A   AB   GREENCOURT   CR   TWP 59-R N 27     PNG from TOP of SURFACE to BASE
of VIKING   100/03-27-059-10-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100
  ALL WI   100   ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty

M1414

  A   AB   GREENCOURT   CR           THIRD PARTY   0   GOR       THIRD PARTY  
70   ALL WI   100   S/S: 1/150.0000 10.0000 - 15.0000%) OIL; 15.0000% GAS; ON
100.0000% PRODUCTION; CONV APO TO 40.0000000%

M1414

  A   AB   GREENCOURT   CR           THIRD PARTY   0   CONT       THIRD PARTY  
30      

M1415

  A   AB   GRIMSHAW   CR   TWP 85-R   6   PNG from TOP of SURFACE to BASE of
BASEMENT   100/10-06-085-21-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100
  ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1416

  A   AB   GRIMSHAW   CR   TWP 85-R   1   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1417

  A   AB   GRIMSHAW   CR   TWP 85-R   2   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1424

  A   AB   BERWYN   CR   TWP 82-R   18   PNG from TOP of SURFACE to BASE of
BASEMENT   100/13-18-082-23-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100
  ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1425

  A   AB   BERWYN   CR   TWP 82-R   19   PNG from TOP of SURFACE to BASE of
BASEMENT   100/07-19-082-23-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100
  ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1426

  A   AB   BERWYN   CR   TWP 82-R   24   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100   ON
100.0000% PRODUCTION; NONCONV.

M1430

  A   AB   SAKWATAMAU   CR   TWP 63-R   1   PNG from BASE of BLUESKY-BU to BASE
of BASEMENT   100/01-01-063-14-W5/00   INTLSVRN   96   LSR   S/S     LESSOR  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1430

  A   AB   SAKWATAMAU   CR           THIRD PARTY   4   GOR     2   THIRD PARTY  
100   ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1431

  A   AB   WINDFALL   CR   TWP 60-R   13   PNG from BASE of BLUESKY-BULLHEAD to
BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100
  ON 100.0000% PRODUCTION; NONCONV.

M1432

  A   AB   WINDFALL   CR   TWP 60-R   14   PNG from BASE of BLUESKY-BULLHEAD to
BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALL WI   100
  ON 100.0000% PRODUCTION; NONCONV.

M1433

  A   AB   BOUNDARY LK   CR   TWP 83-R   18   PNG from TOP of SURFACE to BASE of
BASEMENT   100/15-18-083-12-W6/00   INTLSVRN   40   LSR   S/S     LESSOR   100  
ALL WI   100   ON 100.0000% PRODUCTION; NONCONV.

M1433

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   80   ON 50.0000% PRODUCTION; NONCONV.

M1433

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1433

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1434

  A   AB   BOUNDARY LK   CR   TWP 83-R N & SW   19   PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   40   LSR   S/S     LESSOR   100   ALLWI   100  
ON 100.0000% PRODUCTION; NONCONV.

M1434

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   80   ON 50.0000% PRODUCTION; NONCONV.

M1434

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1434

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1435

  A   AB   GRIMSHAW   CR   TWP 84-R   28   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1436

  A   AB   GRIMSHAW   CR   TWP 84-R   29   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1438

  A   AB   BOUNDARY LK   CR   TWP 83-R   24   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   40   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1438

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   80   ON 50.0000% PRODUCTION; NONCONV.

M1438

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1438

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1439

  A   AB   BOUNDARY LK   CR   TWP 83-R SE   19   PNG from TOP of SURFACE to BASE
of BASEMENT     INTLSVRN   40   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1439

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   80   ON 50.0000% PRODUCTION; NONCONV.

M1439

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1439

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1440

  A   AB   MEEKWAP   CR   TWP 66-R     Sec. 27 PNG from TOP of SURFACE to BASE
of BASEMENT   100/10-27-066-15-W5/00   INTLSVRN   75   LSR   S/S     LESSOR  
100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1440

  A   AB   MEEKWAP   CR           THIRD PARTY   25                

M1442

  A   AB   BOUNDARY LK   CR   TWP 83-R     Sec. 14 PNG from TOP of SURFACE to
BASE of BASEMENT   100/02-14-083-13-W6/00   INTLSVRN   40   LSR   S/S     LESSOR
  100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1442

  A   AB   BOUNDARY LK   CR           THIRD PARTY   50   GOR     2   THIRD PARTY
  100   INTLSVRN   80   ON 50.0000% PRODUCTION; NONCONV.

M1442

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1442

  A   AB   BOUNDARY LK   CR           THIRD PARTY   5   CONT           THIRD
PARTY   10  

M1443

  A   AB   MEDICINE RIVER   FH   TWP 38-R SW   25   PTI NG from TOP of COLONY to
BASE of COLONY   102/02-25-038-03-W5/00   INTLSVRN   50   LSR     17.5   THIRD
PARTY   100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1443

  A   AB   MEDICINE RIVER   FH           THIRD PARTY   50                

M1444

  A   AB   MEDICINE RIVER   CR   TWP 38-R SW   25   PT NG base EDMONTON to BASE
of MANNVILLE excl. PNG in the BASAL QUARTZ   102/02-25-038-03-W5/00   INTLSVRN  
100   LSR   S/S     LESSOR   100   ALLWI   100   ON 100.0000% PRODUCTION;
NONCONV.

M1444

  A   AB   MEDICINE RIVER   CR           THIRD PARTY   0   GOR       THIRD PARTY
  100   ALLWI   100   10.0000% GAS; ON 100.0000% PRODUCTION; CONV APO TO
50.0000000%

M1445

  A   AB   BOUNDARY LK   CR   TWP 83-R     Sec. 16 PNG BASE of BLUESKY-BULLHEAD
Excluding the Gething/Cadomin & Pet. in the Baldonnel.   100/12-16-083-12-W6/02
  INTLSVRN   16   LSR   S/S     LESSOR   100   ALLWI   100   ON 100.0000%
PRODUCTION; NONCONV.

M1445

  A   AB   BOUNDARY LK   CR           THIRD PARTY   20   GOR     2   THIRD PARTY
  100   INTLSVRN   80   ON 39.5000% PRODUCTION; NONCONV.

M1445

  A   AB   BOUNDARY LK   CR           THIRD PARTY   2   CONT           THIRD
PARTY   10  

M1445

  A   AB   BOUNDARY LK   CR           THIRD PARTY   2   CONT           THIRD
PARTY   10  

M1445

  A   AB   BOUNDARY LK   CR           THIRD PARTY   60                

M1446

  A   AB   BOUNDARY LK   CR   TWP 83-R     Sec. 15 PNG from TOP of SURFACE to
BASE of BASEMENT   100/11-15-083-13-W6/00   INTLSVRN   26.667   LSR   S/S    
LESSOR   100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1446

  A   AB   BOUNDARY LK   CR           THIRD PARTY   66.667   GOR     2   THIRD
PARTY   100   INTLSVRN   80   ON 33.3330% PRODUCTION; NONCONV.

M1446

  A   AB   BOUNDARY LK   CR           THIRD PARTY   3.333   CONT           THIRD
PARTY   10  

M1446

  A   AB   BOUNDARY LK   CR           THIRD PARTY   3.333   CONT           THIRD
PARTY   10  

M1447

  A   AB   BOUNDARY LK   CR   TWP 83-R     Sec. 22 PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   26.667   LSR   S/S     LESSOR   100   ALLWI  
100   ON 100.0000% PRODUCTION; NONCONV.

M1447

  A   AB   BOUNDARY LK   CR           THIRD PARTY   66.667   GOR     2   THIRD
PARTY   100   INTLSVRN   80   ON 33.3330% PRODUCTION; NONCONV.

M1447

  A   AB   BOUNDARY LK   CR           THIRD PARTY   3.333   CONT           THIRD
PARTY   10  

M1447

  A   AB   BOUNDARY LK   CR           THIRD PARTY   3.333   CONT           THIRD
PARTY   10  

M1448

  A   AB   BOUNDARY LK   CR   TWP 83-R   21   PTN) PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   26.667   LSR   S/S     LESSOR   100   ALLWI  
100   ON 100.0000% PRODUCTION; NONCONV.

M1448

  A   AB   BOUNDARY LK   CR           THIRD PARTY   66.667   GOR     2   THIRD
PARTY   100   INTLSVRN   80   ON 33.3330% PRODUCTION; NONCONV.

M1448

  A   AB   BOUNDARY LK   CR           THIRD PARTY   3.333   CONT           THIRD
PARTY   10  

M1448

  A   AB   BOUNDARY LK   CR           THIRD PARTY   3.333   CONT           THIRD
PARTY   10  

M1449

  A   AB   BOUNDARY LK   CR   TWP 83-R 2, 3     PNG from BASE of CHARLIE LAKE to
BASE of GOLATA     INTLSVRN   22   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1449

  A   AB   BOUNDARY LK   CR           THIRD PARTY   27.5   GOR     2   THIRD
PARTY   100   INTLSVRN   80   ON 27.5000% PRODUCTION; NONCONV.

M1449

  A   AB   BOUNDARY LK   CR           THIRD PARTY   45   CONT           THIRD
PARTY   10  

M1449

  A   AB   BOUNDARY LK   CR           THIRD PARTY   2.75   CONT           THIRD
PARTY   10  

M1449

  A   AB   BOUNDARY LK   CR           THIRD PARTY   2.75                

M1450

  A   AB   RED EARTH   FH   TWP 87-R SW 11     PNG from TOP of SURFACE to BASE
of GRANITE WA   100/14-02-087-09-W5/02   THIRD PARTY   100   LSR   S/S    
LESSOR   100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1450

  A   AB   RED EARTH   FH   TWP 87-R 11( LSDS 11, 12, 14)             GOR      
INTLSVRN   100   ALLWI   100   S/S: 1/150.0000 5.0000 - 15.0000%) OIL; 15.0000%
GAS; ON 50.0000% PRODUCTION; NONCONV

M1450

  B   AB   RED EARTH   FH   TWP 87-R NW 2     PNG from TOP of SURFACE to BASE of
SLAVE POINT     THIRD PARTY   100   LSR   S/S     LESSOR   100   ALLWI   100  
ON 100.0000% PRODUCTION; NONCONV.

M1453

  A   AB   CRANBERRY   CR   TWP 95-R Sec. 9     PNG from TOP of SURFACE to BASE
of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1454

  A   AB   CRANBERRY   CR   TWP 95-R Sec. 1     PNG from TOP of SURFACE to BASE
of BASEMENT   100/12-01-095-04-W6/00   INTLSVRN   100   LSR   S/S     LESSOR  
100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1455

  A   AB   CRANBERRY   CR   TWP 95-R Sec. 24     PNG from TOP of SURFACE to BASE
of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

M1456

  A   AB   HOTCHKISS   CR   TWP 94-R 1, 11, 14     PNG from TOP of SURFACE to
BASE of BASEMENT   100/09-14-094-25-W5/00   INTLSVRN   100   LSR   S/S    
LESSOR   100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1456

  A   AB   HOTCHKISS   CR         100/12-01-094-25-W5/00       GOR     2   THIRD
PARTY   100   ALLWI   100   ON 100.0000% PRODUCTION; NONCONV.

M1458

  A   AB   GRIMSHAW   CR   TWP 85-R Sec. 5     PNG from TOP of SURFACE to BASE
of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100   ALLWI   100   ON
100.0000% PRODUCTION; NONCONV.

--------------------------------------------------------------------------------

[ILLEGIBLE THROUGHOUT TABLE]

M1459   A   AB   GRIMSHAW   CR   TWP 85-RGSec. 7   PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl   100 ON
100.0000% PRODUCTION; NONCONV. M1460   A   AB   GRIMSHAW   CR  
TWP 85-RG N & SE 12   PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN  
100   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV.
M1461   A   AB   WINDFALL   CR   TWP 61-RGSec. 34   PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl   100 ON
100.0000% PRODUCTION; NONCONV. M1462   A   AB   MEDICINE RIVER   CR   TWP
38-RGSec.. 32   PNG from TOP of SURFACE to BASE of EDMONTON SAND     INTLSVRN  
100   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV.
M1463   A   AB   DAWSON   CR   TWP 79-RGSec. 30   PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl   100 ON
100.0000% PRODUCTION; NONCONV. M1464   A   AB   DAWSON   CR   TWP 79-RGSec. 31  
PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN   100   LSR   S/S    
LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1465   A   AB  
DAWSON   CR   TWP 80-RGSec. 1   PNG from TOP of SURFACE to BASE of BASEMENT    
INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000%
PRODUCTION; NONCONV. M1466   A   AB   SAKWATAMAU   CR   TWP 63-RGSec. 1   PNG
from BASE of 519 METRES to BASE of SPIRIT RIVER   100/01-01-063-14-W5/00  
INTLSVRN   96   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION;
NONCONV. M1466   A   AB   SAKWATAMAU   CR         THIRD PARTY   4   GOR      
THIRD PARTY   100 ALL Wl   100 S/S: 1/23.8365 (5.0000 - 12.0000%) OIL; 12.0000%
GAS; ON 100.0000% PRODUCTION; NONCONV M1466   A   AB   SAKWATAMAU   CR        
THIRD PARTY   0   GOR     2   THIRD PARTY   100 ALL Wl   100 ON 100.0000%
PRODUCTION; NONCONV. M1467   A   AB   ESTUARY   CR   TWP 22-RGS&NE 18   PNG from
BASE of MEDICINE HAT to BASE of BASEMENT     INTLSVRN   100   LSR   S/S    
LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1467   A   AB  
ESTUARY   CR   TWP 22-RG 18 (LSDS 1.1 & 14)         GOR     2   THIRD PARTY  
100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1468   A   AB   ESTUARY   CR
  TWP 23-RGSec. 24   PNG from BASE of MEDICINE HAT to BASE of BASEMENT    
INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000%
PRODUCTION; NONCONV. M1469   A   AB   SWAN HILLS   CR   TWP 65-RGW 15   PNG from
TOP of SURFACE to BASE of BASEMENT     INTLSVRN   95   LSR   S/S     LESSOR  
100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1469   A   AB   SWAN HILLS  
CR         THIRD PARTY   5   GOR     2   THIRD PARTY   100 ALL Wl   100 ON
100.0000% PRODUCTION; NONCONV. M1470   A   AB   CRANBERRY   CR   TWP 95-RGSec. 2
  PNG from TOP of SURFACE to BASE of DEBOLT   100/10-02-095-04-W6/00   INTLSVRN
  100   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION;
NONCONV. Crown Sliding Scale Royalty M1471   A   AB   ANTE CREEK   CR   TWP
67-RGSec. 36   PNG from TOP of SURFACE to BASE of BASEMENT  
104/10-36-067-24-W5/00   INTLSVRN   25   LSR   S/S     LESSOR   100 ALL Wl   100
ON 100.0000% PRODUCTION; NONCONV. M1471   A   AB   ANTE CREEK   CR      
104/10-36-067-24-W5/02   THIRD PARTY   57.191             M1471   A   AB   ANTE
CREEK   CR         THIRD PARTY   17.809             M1472   A   AB   GRIMSHAW  
CR   TWP 84-RGSec. 30   PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN
  100   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION;
NONCONV. M1473   A   AB   GRIMSHAW   CR   TWP 84-RGSec. 31   PNG from TOP of
SURFACE to BASE of BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100 ALL
Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1474   A   AB   GRIMSHAW   CR   TWP
84-RGSec. 25   PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN   100  
LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1475
  A   AB   GRIMSHAW   CR   TWP 84-RGSec.36   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl   100 ON
100.0000% PRODUCTION; NONCONV. M1476   A   AB   VIRGINIA HILLS   CR   TWP
65-RGSec. 25   PNG from BASE of BLUESKY-BULLHEAD to BASE of BASEMENT    
INTLSVRN   90   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION;
NONCONV. M1476   A   AB   VIRGINIA HILLS   CR         THIRD PARTY   10   GOR    
2   THIRD PARTY   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. M1477   A  
AB   MEDICINE RIVER   FH   TWP 38-RGSE 31   NG from TOP of SURFACE to BASE of
BASEMENT   100/01-31-038-02-W5/00   INTLSVRN   100   LSR       LESSOR   100 ALL
Wl   100 18.0000% GAS; ON 100.0000% PRODUCTION; NONCONV. DEDUCT: 40.0000%,
                            M1478   A   AB   MEDICINE RIVER   FH   TWP 38-RGSE
31   NG from TOP of SURFACE to BASE of BASEMENT   100/01-31-038-02-W5/00  
INTLSVRN   100   LSR       LESSOR   100 ALL Wl   100 18.0000% GAS; ON 100.0000%
PRODUCTION; NONCONV. DEDUCT: 40.0000%,                           M1479   A   AB
  MEDICINE RIVER   FH   TWP 38-RGSE 31   NG from TOP of SURFACE to BASE of
BASEMENT   100/01-31-038-02-W5/00   INTLSVRN   100   LSR       LESSOR   100 ALL
Wl   100 18.0000% GAS; ON 100.0000% PRODUCTION; NONCONV. DEDUCT: 40.0000%,      
                      M1480   A   AB   MEDICINE RIVER   FH   TWP 38-RG NW 31  
NG from TOP of SURFACE to BASE of BASEMENT   100/01-31-038-02-W5/00   INTLSVRN  
100   LSR     18   LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV.
DEDUCT: 40.0000%,                             M1481   A   AB   MEDICINE RIVER  
FH   TWP 38-RG NE 31   NG from TOP of SURFACE to BASE of BASEMENT  
100/01-31-038-02-W5/00   INTLSVRN   100   LSR     20   THIRD PARTY   62.5 ALL Wl
  100 ON 100.0000% PRODUCTION; NONCONV. DEDUCT: 50.0000%,                      
      M1482   A   AB   JOARCAM   CR   TWP 47-RG NE 26   PNG from TOP of SURFACE
to BASE of BASEMENT     INTLSVRN   40   LSR   S/S     LESSOR   100 ALL Wl   100
ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty M1482   A   AB  
JOARCAM   CR         THIRD PARTY   60   GOR     2.5   THIRD PARTY   25 ALLWI  
100 ON 100.0000% PRODUCTION; NONCONV. M1483   A   AB   JOARCAM   CR   TWP
46-RGSec. 14   PNG from TOP of SURFACE to BASE of JOLI FOU  
02/13-14-046-20-W4/00   INTLSVRN   40   LSR   S/S     LESSOR   100 ALL Wl   100
ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty. M1483   A   AB  
JOARCAM   CR         THIRD PARTY   60   GOR     8   THIRD PARTY   25 ALL WI  
100 ON 100.0000% PRODUCTION; NONCONV. M1484   A   AB   JOARCAM   CR  
TWP47-RGSec.10   PNG from TOP of SURFACE to BASE of BELLY RIVER     INTLSVRN  
40   LSR   S/S     LESSOR   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV.
Crown Sliding Scale Royalty. M1484   A   AB   JOARCAM   CR         THIRD PARTY  
60   GOR     8   THIRD PARTY   25 ALL WI   100 ON 100.0000% PRODUCTION; NONCONV.
M1485   A   AB   JOARCAM   CR   TWP47-RGSec.10   PNG from BASE of BELLY RIVER to
BASE of MANNVILLE   00/13-10-047-20-W4/00   INTLSVRN   40   LSR   S/S     LESSOR
  100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale
Royalty. M1485   A   AB   JOARCAM   CR         THIRD PARTY   60   GOR     8  
THIRD PARTY   25 ALL WI   100 ON 100.0000% PRODUCTION; NONCONV. M1486   A   AB  
JOARCAM   CR   TWP 46-RGSec. 6   PNG from TOP of SURFACE to BASE of BASEMENT    
INTLSVRN   40   LSR   S/S     THIRD PARTY   100 ALL Wl   100 ON 100.0000%
PRODUCTION; NONCONV. Crown Sliding Scale Royalty M1486   A   AB   JOARCAM   CR  
      THIRD PARTY   60   GOR     2.5   THIRD PARTY   25 ALL WI   100 ON
100.0000% PRODUCTION; NONCONV. M1487   A   AB   JOARCAM   CR   TWP 46-RG NE 26  
PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN   40   LSR   S/S    
THIRD PARTY   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. Crown Sliding
Scale Royalty M1487   A   AB   JOARCAM   CR         THIRD PARTY   60   GOR    
2.5   THIRD PARTY   25 ALL WI   100 ON 100.0000% PRODUCTION; NONCONV. M1488   A
  AB   JOARCAM   CR   TWP 47-RGSec. 6   PNG from TOP of SURFACE to BASE of
BASEMENT     INTLSVRN   40   LSR   S/S     THIRD PARTY   100 ALL Wl   100 ON
100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty M1488   A   AB  
JOARCAM   CR         THIRD PARTY   60   GOR     2.5   THIRD PARTY   25 ALL WI  
100 ON 100.0000% PRODUCTION; NONCONV. M1489   A   AB   JOARCAM   CR   TWP 47-RG
E 12   PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN   40   LSR   S/S
    THIRD PARTY   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. Crown
Sliding Scale Royalty M1489   A   AB   JOARCAM   CR         THIRD PARTY   60  
GOR     2.5   THIRD PARTY   25 ALL WI   100 ON 100.0000% PRODUCTION; NONCONV.
M1490   A   AB   JOARCAM   CR   TWP 47-RG NE 26   PNG from TOP of SURFACE to
BASE of BASEMENT     INTLSVRN   40   LSR   S/S     THIRD PARTY   100 ALL Wl  
100 ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty M1490   A   AB
  JOARCAM   CR         THIRD PARTY   60   GOR     2.5   THIRD PARTY   25 ALL WI
  100 ON 100.0000% PRODUCTION; NONCONV. M1491   A   AB   GRIMSHAW   CR   TWP
84-RGS&NE17   PNG from TOP of SURFACE to BASE of BASEMENT  
102/10-17-084-22-W5/00   INTLSVRN   100   LSR   S/S     LESSOR   100 ALL Wl  
100 ON 100.0000% PRODUCTION; NONCONV. M1492   A   AB   JOARCAM   CR  
TWP46-RGSec.2   PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN   40  
LSR   S/S     THIRD PARTY   100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV.
Crown Sliding Scale Royalty M1492   A   AB   JOARCAM   CR         THIRD PARTY  
60   GOR     2.5   THIRD PARTY   25 ALL WI   100 ON 100.0000% PRODUCTION;
NONCONV. M1493   A   AB   JOARCAM   CR   TWP 46-RGSec. 11   PNG from TOP of
SURFACE to BASE of BASEMENT     INTLSVRN   40   LSR   S/S     THIRD PARTY   100
ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty M1493
  A   AB   JOARCAM   CR         THIRD PARTY   60   GOR     2.5   THIRD PARTY  
25 ALL WI   100 ON 100.0000% PRODUCTION; NONCONV. M1494   A   AB   JOARCAM   CR
  TWP 45-RGSec. 34   PNG from TOP of SURFACE to BASE of BASEMENT     INTLSVRN  
40   LSR   S/S     THIRD PARTY   100 ALL Wl   100 ON 100.0000% PRODUCTION;
NONCONV. Crown Sliding Scale Royalty M1494   A   AB   JOARCAM   CR         THIRD
PARTY   60   GOR     2.5   THIRD PARTY   25 ALL WI   100 ON 100.0000%
PRODUCTION; NONCONV. M1495   A   AB   JOARCAM   CR   TWP46-RGSec. 36   PNG from
TOP of SURFACE to BASE of BASEMENT     INTLSVRN   40   LSR   S/S     THIRD PARTY
  100 ALL Wl   100 ON 100.0000% PRODUCTION; NONCONV. Crown Sliding Scale Royalty
M1495   A   AB   JOARCAM   CR         THIRD PARTY   60   GOR     2.5   THIRD
PARTY   25 ALL WI   100 ON 100.0000% PRODUCTION; NONCONV. M1496   A   BC   ALCES
  CR   TWP 83-RGSec. 22   PNG from TOP of SURFACE to BASE of CHARLIE LAKE  
100/11-22-083-14-W6/00   INTLSVRN   80   LSR   S/S     LESSOR   100 ALL Wl   100
ON 100.0000% PRODUCTION; NONCONV. M1496   A   BC   ALCES   CR         THIRD
PARTY   10   GOR     2   THIRD PARTY   100 ALL Wl   100 ON 100.0000% PRODUCTION;
NONCONV. M1496   A   BC   ALCES   CR         THIRD PARTY   5             M1496  
A   BC   ALCES   CR         THIRD PARTY   5            

--------------------------------------------------------------------------------

AREA

    LTYPE        FHCR        INT_TYPE        OPERATOR        PROD      ROFR  

EXPIRY

(YYYYMMDD)

  LOCATION    DESCRIPT   RIGHTS     WELL_NO PARTNER        WIPERCENT   
VIKING-KINSELLA     PPL        FH        Wl        INTLSVRN        NP       
20970903   TWP 46-RGE 12-W4M    NE 26   Pipeline tie in 6-36-46-12-W4M    
INTLSVRN        100    VIKING-KINSELLA     PPL        FH        Wl       
INTLSVRN        NP        20970903   TWP 46-RGE 12-W4M    SE 35      
VIKING-KINSELLA     PPL        FH        Wl        INTLSVRN        NP       
20970903   TWP 46-RGE 12-W4M    SW 36       VIKING-KINSELLA     PPL        FH   
    Wl        INTLSVRN        NP        20970831   TWP 46-RGE 12-W4M    NW 26  
Pipeline tie in 6-36-46-12-W4M     INTLSVRN        100    VIKING-KINSELLA    
PPL        FH        Wl        INTLSVRN        NP        20970831   TWP 46-RGE
12-W4M    NE 27   Pipeline tie in 6-36-46-12-W4M     INTLSVRN        100    SWAN
HILLS     PPL        CR        Wl        INTLSVRN        NP        20831003  
TWP 63-RGE 10-W5M    N 34   Pipeline tie-in from 4-18-64-9-W5M to battery in
14-34-63-10-W5M     INTLSVRN        100    SWAN HILLS     PPL        CR       
Wl        INTLSVRN        NP        20831003   TWP 64-RGE 9-W5M    W 6      
SWAN HILLS     PPL        CR        Wl        INTLSVRN        NP        20831003
  TWP 64-RGE 9-W5M    W 7       SWAN HILLS     PPL        CR        Wl       
INTLSVRN        NP        20831003   TWP 64-RGE 9-W5M    SW 18       SWAN HILLS
    PPL        CR        Wl        INTLSVRN        NP        20831003   TWP
64-RGE 10-W5M    S 1       SWAN HILLS     PPL        CR        Wl       
INTLSVRN        NP        20831003   TWP 64-RGE 10-W5M    S 2       SWAN HILLS  
  PPL        CR        Wl        INTLSVRN        NP        20831003   TWP 64-RGE
10-W5M    S 3       KILLAM     PPL        FH        Wl        INTLSVRN        NP
       20970831   TWP 46-RGE 12-W4M    NW 27   Pipeline right-of way    
INTLSVRN        100    INGA     PPL        FH        Wl        INTLSVRN       
NP        20171014   TWP 85-RGE 23-W6M    E 30   Pipeline right of way 16-19 to
8-31-85-23-W6M     INTLSVRN        100    INGA     PPL        FH        Wl     
  INTLSVRN        NP        20171014   TWP 85-RGE 23-W6M    SE 31       MEDICINE
RIVER     PPL        FH        Wl        INTLSVRN        NP        21010108  
TWP 38-RGE 2-W5M    NW 29   Pipeline right of way     INTLSVRN        100   
LITTLE BOW     PPL        FH        Wl        INTLSVRN        NP        21020323
  TWP 14-RGE 20-W4M    SW 31   Pipeline tie-in 14-30-14-20-W4M     INTLSVRN     
  50    LITTLE BOW     PPL        CR        Wl        INTLSVRN        NP       
21020521   TWP 14-RGE 20-W4M    SE 31, S 32   Pipeline tie in 7-36-14-21-W4M to
7-32-14-20-W4M     INTLSVRN        50    LITTLE BOW     PPL        CR        Wl
       INTLSVRN        NP        21030705   TWP 14-RGE 21-W4M    NE 25  
Pipeline tie-in 14-30-14-20-W4M to 15-25-14-21-W4M     INTLSVRN        66.667   
LITTLE BOW     PPL        CR        Wl        INTLSVRN        NP        21030721
  TWP 14-RGE 20-W4M    NE 30   Pipeline tie-in 14-30-14-20-W4M to
15-30-14-20-W4M     INTLSVRN        66.667    LITTLE BOW     PPL        FH     
  Wl        INTLSVRN        NP        21030624   TWP 14-RGE 20-W4M    NW 30  
Pipeline tie-in 14-30-14-20-W4M to 15-30-14-20-W4M     INTLSVRN        66.667   
MEDICINE RIVER     PPL        FH        Wl        INTLSVRN        NP       
21030815   TWP 38-RGE 2-W5M    NE 30   Pipeline tie-in 1-31-38-2-W5M to
16-30-38-2-W5M     INTLSVRN        50.366    HAYS     PPL        FH        Wl   
    INTLSVRN        NP        21040405   TWP 14-RGE 16-W4M    SW 2   Pipeline
tie in 6-35-14-16-W4M     INTLSVRN        80    HAYS     PPL        FH        Wl
       INTLSVRN        NP        21040405   TWP 14-RGE 16-W4M    W & SE 2  
Pipeline tie in 6-35-14-16-W4M     INTLSVRN        80    LACOMBE     PPL       
FH        Wl        INTLSVRN        NP        21040328   TWP43-RGE25-W4M    SE 2
  Pipeline tie-in 10-2-43-25-W4M     INTLSVRN        50    LACOMBE     PPL     
  FH        Wl        INTLSVRN        NP        21040328   TWP 43-RGE 25-W4M   
NE 2   Pipeline tie-in 10-2-43-25-W4M     INTLSVRN        50    PREVO     PPL   
    FH        Wl        INTLSVRN        NP        21050705   TWP 39-RGE 1-W5M   
SW 21   Pipeline tie-in for 102/06-21-039-01W5/00     INTLSVRN        75   
BERWYN     PPL        FH        Wl        INTLSVRN        NP        21051004  
TWP 82-RGE 24-W5M    W 2   Pipeline tie-in for Intl Sovn Berwyn 2-11-82-24-W5M  
  INTLSVRN        100    BERWYN     PPL        FH        Wl        INTLSVRN     
  NP        21051004   TWP 82-RGE 24-W5M    SE 11       BERWYN     PPL        FH
       Wl        INTLSVRN        NP        21051009   TWP 82-RGE 24-W5M    SW 11
  Pipeline tie-in for Intl Sovn Berwyn 2-11-82-24-W5M     INTLSVRN        100   
MEDICINE RIVER     PPL        FH        Wl        INTLSVRN        NP       
21051004   TWP 38-RGE 2-W5M    SW 29   Pipeline tie-in for 5-30-38-2-W5M    
INTLSVRN        91    MEDICINE RIVER     PPL        FH        Wl        INTLSVRN
       NP        21050920   TWP 38-RGE 2-W5M    SW 30   Pipeline tie-in for
5-30-38-2-W5M     INTLSVRN        91    MEDICINE RIVER     PPL        FH       
Wl        INTLSVRN        NP        21051002   TWP 38-RGE 2-W5M    SE 30  
Pipeline tie-in for 5-30-38-2-W5M     INTLSVRN        91    GRIMSHAW     PPL   
    CR        Wl        INTLSVRN        NP        21060207   TWP 84-RGE 22-W5M
   NE 17   Pipeline right of way 1-20-84-22-W5M to 10-17-84-22-W5M     INTLSVRN
       100    GRIMSHAW     PPL        CR        Wl        INTLSVRN        NP   
    21060207   TWP 84-RGE 22-W5M    SE 20       CRANBERRY     PPL        CR     
  Wl        INTLSVRN        NP        21081125   TWP 95-RGE 4-W6M    NW 1, NE 2
  Pipeline tie in 12-1 to 10-2-95-4-W6M     INTLSVRN        100    LITTLE BOW  
  PPL        CR        Wl        INTLSVRN        NP      N   21020806   TWP
14-RGE 21-W4M    NE 25, SE 36   Pipeline tie-inl5-25 & 7-36-14-21-W4M    
INTLSVRN        50    CRANBERRY     PPL        CR        Wl        INTLSVRN     
  NP        21081204   TWP 95-RGE 4-W6M    N 2, E 10, W 11   Pipeline tie-in for
100/10-02-095-04W6/00     INTLSVRN        100   

--------------------------------------------------------------------------------

AREA    LTYPE    FHCR    INT_TYPE    OPERATOR    EXPIRY(YYYYMMDD)      LOCATION
   DESCRIPT         RIGHTS   WELL_NO    PARTNER      WIPERCENT   BELLSHILL LAKE
   SL    FH    Wl    INTLSVRN      20140302       TWP 41-RGE 13-
W4M    SE 11     Wellsite and access road to 2-11-41-13-W4M        INTLSVRN   
     6.25    HAYS    SL   

FH

   Wl    INTLSVRN      20281029       TWP 13-RGE 16-
W4M    SW 35     Wellsite and access road to 6-35-13-16-W4M        INTLSVRN   
     80    ATLEE-BUFFALO    COO    FH    Wl    INTLSVRN      20150527       TWP
20-RGE 7-W4M    NW 21     Wellsite and Access Road to 12-21-20-7-W4M       
INTLSVRN         100    ATLEE-BUFFALO    SL    FH    Wl    INTLSVRN     
20150528       TWP 20-RGE 7-W4M    NW 21     Wellsite and Access Road to
12-21-20-7-W4M        INTLSVRN         100    MARWAYNE    SL    FH    Wl   
INTLSVRN      20211106       TWP 52-RGE 1-W4M    NW 28     Wellsite and access
road to 13-28-52-1-W4M        INTLSVRN         100    MARWAYNE    SL    FH    Wl
   INTLSVRN      20220408       TWP 52-RGE 1-W4M    NW 28     Wellsite and
access road to 12-28-52-1-W4M        INTLSVRN         100    MARWAYNE    SL   
FH    Wl    INTLSVRN      20170409       TWP 52-RGE 1-W4M    NW 28     Wellsite
and Access Road to Constellation et al 14 C-28-52-1-W4M        INTLSVRN        
100    DYBERG    SL    FH    Wl    INTLSVRN      20190426       TWP 41-RGE 23-
W4M    NW 29     Wellsite and Access road fo 6-29-41-23-W4M directional drill
from 11-29.        INTLSVRN         12.5    SWAN HILLS    SL    CR    Wl   
INTLSVRN      20340911       TWP 64-RGE 10-
W5M    NE 36     Wellsite and Access Road to 16-36-64-10-W5M        INTLSVRN   
     100    SWAN HILLS    SL    CR    Wl    INTLSVRN      20340911       TWP
64-RGE 10-
W5M    NE 35     Access Road to 16-36-64-10-W5M        INTLSVRN         100   
SWAN HILLS    SL    CR    Wl    INTLSVRN      20340911       TWP 64-RGE 10-
W5M    N36             SWAN HILLS    SL    CR    Wl    INTLSVRN      19920907   
   TWP 63-RGE 10-
W5M    NW 34     Tank Battery Site        INTLSVRN         100   
VIKING-KINSELLA    SL    FH    Wl    INTLSVRN      20230415       TWP 46-RGE 12-
W4M    SW 36     Wellsite and Access Road to 6-36-46-12-W4M        INTLSVRN   
     100    INGA    SL    FH    Wl    INTLSVRN      20040809       TWP 85-RGE
23-
W6M    NE 19     Wellsite and access road to 16-19-85-23-W6M        INTLSVRN   
     90    MARWAYNE    SL    FH    Wl    INTLSVRN      20250620       TWP 52-RGE
1-W4M    NW 28     Wellsite and access road to 11C-28-52-1-W4M        INTLSVRN
        100    MARWAYNE    SL    FH    Wl    INTLSVRN      20250620       TWP
52-RGE 1-W4M    NW 28     Wellsite and access road to 13C-28-52-1-W4M       
INTLSVRN         100    MARWAYNE    SL    FH    Wl    INTLSVRN      20251107   
   TWP 52-RGE 1-W4M    NW 28     Wellsite and access road to 12C-28-52-1-W4M  
     INTLSVRN         100    MARWAYNE    SL    FH    Wl    INTLSVRN     
20251107       TWP 52-RGE 1-W4M    NW 28     Wellsite and access road to
12D-28-52-1-W4M        INTLSVRN         100    MARWAYNE    SL    FH    Wl   
INTLSVRN      20251107       TWP 52-RGE 1-W4M    NW 28     Wellsite and access
road to 13B-28-52-1-W4M        INTLSVRN         100    MEDICINE RIVER    SL   
FH    Wl    INTLSVRN      20151205       TWP 38-RGE 2-W5M    NE 30     Wellsite
and access road to 16-30-38-2-W5M        INTLSVRN         63.3268    MARWAYNE   
SL    FH    Wl    INTLSVRN      20260909       TWP 52-RGE 1-W4M    NW 28    
Wellsite and access road to 12B-28-52-1-W4M        INTLSVRN         100   
GREENCOURT    SL    FH    Wl    INTLSVRN      20270114       TWP 59-RGE 10-
W5M    SW 27     Wellsite and access road to 3-27-59-10-W5M        INTLSVRN   
     100    LITTLE BOW    SL    CR    Wl    INTLSVRN      20280121       TWP
14-RGE 21-
W4M    SE 36     Wellsite for 7-36-14-21-W4M        INTLSVRN         50   
LITTLE BOW    COO    FH    Wl    INTLSVRN      20280120       TWP 14-RGE 21-
W4M    SE 36     Wellsite and Access Road to 7-36-14-21-W4M        INTLSVRN   
     50    LITTLE BOW    SL    CR    Wl    INTLSVRN      20280425       TWP
14-RGE 21-
W4M    NE 25     Wellsite and Access Road to 15-25-14-21-W4M        INTLSVRN   
     50    LITTLE BOW    COO    CR    Wl    INTLSVRN      20280415       TWP
14-RGE 21-
W4M    NE 25     Wellsite and Access Road to 15-25-14-21-W4M        INTLSVRN   
     50    MARWAYNE    SL    FH    Wl    INTLSVRN      20280425       TWP 52-RGE
1-W4M    SW 28     Wellsite and Access Road to 5B-28-52-1-W5M        INTLSVRN   
     100    MARWAYNE    SL    FH    Wl    INTLSVRN      20280527       TWP
52-RGE 1-W4M    NW 28     Wellsite and access road to 13-28-52-1-W4M       
INTLSVRN         100    LITTLE BOW    SL    FH    Wl    INTLSVRN      20280529
      TWP 14-RGE 20-
W4M    SW 31     Roadway and Riser Site, pipeline tie-in for 15-25 and
7-36-15-21-W4M        INTLSVRN         50    MEDICINE RIVER    SL    FH    Wl   
INTLSVRN      20280716       TWP 38-RGE 2-W5M    SE 31     Wellsite and access
road to 1-31-38-2-W5M        INTLSVRN         50.366    TWO CREEKS    SL    CR
   Wl    INTLSVRN      20280723       TWP 63-RGE 16-
W5M    NW 18     Wellsite and access road to 11-19-63-16-W4M (Drilled
directionally from 6-19-63-16-W5M;        INTLSVRN         65    LACOMBE    SL
   FH    Wl    INTLSVRN      20290621       TWP 43-RGE 25-
W4M    N E2     Wellsite and access road to 10-2-43-25-W4M        INTLSVRN      
  50    LITTLE BOW    SL    FH    Wl    INTLSVRN      20290610       TWP 14-RGE
20-
W4M    NW 30     Wellsite for 14-30-14-20-W4M        INTLSVRN         66.667   
MAPLE    SL    FH    Wl    INTLSVRN      20440316       NTS 94-A-15 BLK E       
18      Wellsite and Access Road to c-18-E/94-A-15           50    LEDUC    SL
   FH    Wl    INTLSVRN      20300727       TWP49-RGE25-W4M    NW 13    
Wellsite and access road to Intl Sovn Leduc 12-13-49-25-W4M        INTLSVRN   
     100    MEDICINE RIVER    SL    FH    Wl    INTLSVRN      20340702       TWP
38-RGE 3-W5M    NW 32     Wellsite and access road to 14-32-38-3-W5M       
INTLSVRN         100    BERWYN    SL    FH    Wl    INTLSVRN      20310209      
TWP 82-RGE 24-
W5M    SE 11     Wellsite and Access Road to Intl Sovn Berwyn 2-11-82-24-W5M  
     INTLSVRN         100    BERWYN    SL    FH    Wl    INTLSVRN      20310209
      TWP 82-RGE 24-
W5M    SW 11     Access Road to Intl Sovn Berwyn 2-11-82-24-W5M        INTLSVRN
        100    MEDICINE RIVER    SL    FH    Wl    INTLSVRN      20310209      
TWP 38-RGE 2-W5M    SW 30     Wellsite and access road to 5-30-38-2-W5M       
INTLSVRN         91    MEDICINE RIVER    SL    FH    Wl    INTLSVRN     
20310209       TWP 38-RGE 2-W5M    SW 30     Wellsite addition for
102/05-30-038-02-W5M        INTLSVRN         91    GRIMSHAW    COO    FH    Wl
   INTLSVRN      20310201       TWP 84-RGE 22-
W5M    NE 17     Wellsite and Access Road to Intl Sovn 10-17-84-22-W5M       
INTLSVRN         100    GRIMSHAW    SL    CR    Wl    INTLSVRN      20310215   
   TWP 84-RGE 22-
W5M    NE 17     Wellsite and Access Road to Intl Sovn Grimshaw 10-17-84-22-W5M
  102/10-17      INTLSVRN         75    PREVO    SL    CR    Wl    INTLSVRN     
20310214       TWP 39-RGE 1-W5M    SW 21     Wellsite and Access Road to Intl
Sovn Prevo 6-21-39-1-W5M        INTLSVRN         75    PREVO    SL    FH    Wl
   INTLSVRN      20310310       TWP 39-RGE 1-W5M    SW 21     Access Road to
Intl Sovn Prevo 6-21-39-1-W5M        INTLSVRN         75    FORESTBURG    SL   
FH    Wl    INTLSVRN      20310308       TWP 42-RGE 16-
W4M    SE 11     Wellsite and Access Road to Intl Sovn Forest 1-11-42-16-W4M  
     INTLSVRN         100    FORESTBURG    SL    FH    Wl    INTLSVRN     
20310316       TWP 42-RGE 16-
W4M    NW 10     Wellsite and access road to Intl Sovn Forest 12-10-42-16-W4M  
     INTLSVRN         100    MEDICINE RIVER    SL    FH    Wl    INTLSVRN     
20071108       TWP 38-RGE 3-W5M    SE 25     Wellsite addition for 2-25-38-3-W5M
       INTLSVRN         100    MANNVILLE    SL    FH    Wl    INTLSVRN     
20310614       TWP 52-RGE 8-W4M    NE 28     Wellsite and access road to
Intlsovn et al 102 Mnnville 10-28-52-8-W4M        INTLSVRN         100   
MEDICINE RIVER    SL    FH    Wl    INTLSVRN      20310703       TWP 38-RGE
2-W5M    SE 31    

Wellsite for Intl Sovn et al 103 MedR 6-31-38-2-W5M (Surface location in Lsd

8-31

       INTLSVRN         100    MEDICINE RIVER    SL    FH    Wl    INTLSVRN     
20311004       TWP 38-RGE 2-W5M    SW 29
(RISER SITE
5 •30-
38-2-
W5M
P/L]     Riser siite for pipeline tie-in 5-30-38-2-W5M        INTLSVRN        
91    MEDICINE RIVER    SL    FH    Wl    INTLSVRN      20200703       TWP
38-RGE 2-W5M    SE 31     Wellsite and access road to Encal PCP HZ MEDR
11-31-38-2-W5M (Surface location in 1-31        INTLSVRN         100    BERWYN
   SL    FH    Wl    INTLSVRN      20320116       TWP 82-RGE 24-
W5M    SE 13     Wellsite and access road to Intl Sovn Berwyn 8-13-82-24-W5M  
     INTLSVRN         100    MEDICINE RIVER    SL    FH    Wl    INTLSVRN     
20211121       TWP 38-RGE 3-W5M    NW 27     Wellsite and access road to
11-27-38-3-W5M        INTLSVRN         100    GRIMSHAW    SL    CR    Wl   
INTLSVRN      20320126       TWP 84-RGE 22-
W5M    SE20     Wellsite and access road to 1-20-84-22-W5M        INTLSVRN      
  100    OSBORN    SL    CR    Wl    INTLSVRN      20320205       TWP 89-RGE
6-W6M    NW 13     Wellsite and access road to Intl Sovl Charlie 12-13-89-6-W6M
       INTLSVRN         100    OSBORN    SL    CR    Wl    INTLSVRN     
20320205       TWP 89-RGE 6-W6M    NW 13     Access road to Intl Sovl Charlie
12-13-89-6-W6M        INTLSVRN         100    OSBORN    SL    CR    Wl   
INTLSVRN      20320205       TWP 89-RGE 6-W6M    N14             ALCES    SL   
FH    Wl    INTLSVRN      20281121       TWP 83-RGE 14-
W6M    N22     Wellsite and access road to 11-22-83-14-W6M        INTLSVRN      
  80    HOTCHKISS    SL    CR    Wl    INTLSVRN      20340202       TWP
94-RGE25-
W5M    S &
NE 14     Access road to 9-14-94-25-W5M        INTLSVRN         100    HOTCHKISS
   SL    CR    Wl    INTLSVRN      20340202       TWP 94-RGE 25-
W5M    NE 14     Wellsite for 9-14-94-25-W5M        INTLSVRN         100   
BERWYN    SL    FH    Wl    INTLSVRN      20290622       TWP 82-RGE 23-
W5M    SE 19     Wellsite and access road to Intl Sovn Berwyn 7-19-82-23-W5M  
     INTLSVRN         100    BERWYN    SL    FH    Wl    INTLSVRN      20290621
      TWP 82-RGE 23-
W5M    NW 18     Wellsite and access road to Intl Sovn Berwyn 13-18-82-23-W5M  
     INTLSVRN         100    SAKWATAMAU    SL    CR    Wl    INTLSVRN     
20220117       TWP 63-RGE 14-
W5M    SE 1     Wellsite for 1-1-63-14-W5M (Surface location in 2-1]       
INTLSVRN         96    SAKWATAMAU    SL    CR    Wl    INTLSVRN      20220117   
   TWP 63-RGE 14-
W5M        1      Access road for 1-1-63-14-W5M (Surface location in 2-i;       
INTLSVRN         96    CRANBERRY    SL    CR    Wl    INTLSVRN      20341110   
   TWP 95-RGE 4-W6M    NE 2     Wellsite for 10-2-95-4-W6M        INTLSVRN      
  100    CRANBERRY    SL    CR    Wl    INTLSVRN      20341110       TWP 95-RGE
4-W6M    NW 1     Wellsite for 12-1-95-4-W6M        INTLSVRN         100   
CRANBERRY    SL    CR    Wl    INTLSVRN      20341110       TWP 95-RGE 4-W6M   
NW 1,
NE 2     Access road to 12-1 and 10-2-95-4-W6M        INTLSVRN         100   
CRANBERRY    SL    CR    Wl    INTLSVRN      20200131       TWP 94-RGE 3-W6M   
SW31     Access road to 10-2-9M-W6M        INTLSVRN         100    CRANBERRY   
SL    CR    Wl    INTLSVRN      20200131       TWP 94-RGE 4-W6M    N &
SW 25             CRANBERRY    SL    CR    Wl    INTLSVRN      20200131      
TWP 94-RGE 4-W6M    S26             CRANBERRY    SL    CR    Wl    INTLSVRN     
20200131       TWP 94-RGE 4-W6M    E27             CRANBERRY    SL    CR    Wl
   INTLSVRN      20200131       TWP 94-RGE 4-W6M    E34             CRANBERRY   
SL    CR    Wl    INTLSVRN      20200131       TWP 94-RGE 4-W6M    SE 36      
      CRANBERRY    SL    CR    Wl    INTLSVRN      20200131       TWP 95-RGE
4-W6M    E &
SW 2             CRANBERRY    SL    CR    Wl    INTLSVRN      20201012       TWP
94-RGE 4-W6M    S27     Access road to 10-2-95-4-W6M        INTLSVRN         100
   CRANBERRY    SL    CR    Wl    INTLSVRN      20201012       TWP 94-RGE 4-W6M
   S28             CRANBERRY    SL    CR    Wl    INTLSVRN      20201012      
TWP 94-RGE 4-W6M    S29             CRANBERRY    SL    CR    Wl    INTLSVRN     
20201012       TWP 94-RGE 4-W6M    S30             HOTCHKISS    SL    CR    Wl
   INTLSVRN      20340325       TWP 94-RGE 25-
W5M    N W1     Wellsite for 100/12-01-094-25W5/00        INTLSVRN         100
   HOTCHKISS    SL    CR    Wl    INTLSVRN      20340325       TWP 94-RGE 25-
W5M    W1     Access Road for 100/12-01-094-25W5/00        INTLSVRN         100
  

--------------------------------------------------------------------------------

SCHEDULE 2

TANGIBLES

WELLS

[NTD: Insert well ID]

ABANDONED WELLS

[NTD: Insert well ID]

OTHER TANGIBLES

[NTD: Insert description with land descriptor]

--------------------------------------------------------------------------------

UWI

   WI %    

Field

Name

  

Tangible Property

100/06-35-013-16W4/2      80.00 %    ENCHANT    Wellhead; 2 phase vertical
seperator; Dry gas meter run; 100 bbl DW tank 102/14-30-014-20W4/0      44.45 % 
  LITTLE BOW    Wellhead; 2 phase vertical seperator; Dry gas meter run;
100/15-25-014-21W4/0      50.00 %    LITTLE BOW    Wellhead; 2 phase vertical
seperator; Dry gas meter run; Plungerlift controller; 100 bbl DW tank
100/07-36-014-21W4/2      50.00 %    LITTLE BOW    Wellhead; 2 phase vertical
seperator; Dry gas meter run; 100 bbl DW tank; 200 hp compressor
100/16-35-036-14W4/0      4.17 %    PROVOST    Wellhead 100/10-02-043-25W4/0   
  50.00 %    PONOKA    Wellhead 102/13-14-046-20W4/0      40.00 %    JOARCAM   
Wellhead; Hydraulic pumpjack; 400 bbl SW tank 100/13-10-047-20W4/0      40.00 % 
  JOARCAM    Wellhead; Hydraulic pumpjack; 400 bbl SW tank 47-4W4 Unit      2.79
%    WILDMERE    Multiple wellheads, seperators, injectors, storage, metering, &
treating facilities 100/12-13-049-25W4/3      100.00 %    LEDUC-WOODBEND   
Wellhead 100/05-17-089-21W4/0      10.00 %    LIEGE    Wellhead; Wet Gas
Metering Unit 100/11-18-089-21W4/0      10.00 %    LIEGE    Wellhead; Wet Gas
Metering Unit 100/10-11-089-22W4/0      10.00 %    LIEGE    Wellhead; Wet Gas
Metering Unit 100/06-13-089-22W4/0      10.00 %    LIEGE    Wellhead; Wet Gas
Metering Unit 100/07-14-089-22W4/0      10.00 %    LIEGE    Wellhead; Injection
Pump, Seperator, & Storage Tank 100/16-22-089-22W4/0      10.00 %    LIEGE   
Wellhead; Wet Gas Metering Unit 102/10-23-089-22W4/0      10.00 %    LIEGE   
Wellhead; Wet Gas Metering Unit 100/03-24-089-22W4/0      10.00 %    LIEGE   
Wellhead; Wet Gas Metering Unit 100/05-30-038-02W5/0      91.50 %    MEDICINE
RIVER    Wellhead; 2 phase vertical seperator; Dry gas zedi metering unit;
Plungerlift controller; 400 bbl DW tank 102/05-30-038-02W5/0      91.50 %   
MEDICINE RIVER    Wellhead; 2 phase vertical seperator; Dry gas zedi metering
unit; 400 bbl DW tank 100/16-30-038-02W5/0      63.27 %    MEDICINE RIVER   
Wellhead; 3 phase vertical seperator; Dry gas meter run; Plungerlift controller;
210 bbl SW tank 100/01-31-038-02W5/0      50.37 %    MEDICINE RIVER    Wellhead;
2 phase vertical seperator; Dry gas meter run; 100 bbl DW tank; 85 hp compressor
102/06-31-038-02W5/0      100.00 %    MEDICINE RIVER    Wellhead
100/02-25-038-03W5/2      46.50 %    MEDICINE RIVER    Wellhead; 2 phase
vertical seperator; Dry gas meter run; 400 bbl DW tank 102/02-25-038-03W5/2     
72.83 %    MEDICINE RIVER    Wellhead; 2 phase vertical seperator; Dry gas zedi
metering unit; 400 bbl DW tank 100/11-27-038-03W5/0      100.00 %    MEDICINE
RIVER    Wellhead 102/06-21-039-01W5/2      75.00 %    PREVO    Wellhead; 3
phase vertical seperator; Dry gas meter run; Plungerlift controller; 100 bbl DW
tank 100/03-27-059-10W5/0      100.00 %    BLUERIDGE    Wellhead
100/01-01-063-14W5/2      96.00 %    SAKWATAMAU    Wellhead 100/16-36-064-10W5/2
     100.00 %    SWAN HILLS    Wellhead; 2 phase vertical seperator;
Conventional Pumpjack; 400 bbl DW tank 100/10-27-066-15W5/2      25.00 %   
MEEKWAP    Wellhead 104/10-36-067-24W5/2      25.00 %    ANTE CREEK N   
Wellhead 100/02-11-082-24W5/2      100.00 %    BERWYN    Wellhead; 3 phase
vertical seperator; Dry gas zedi metering unit; 400 bbl DW tank
100/07-11-082-24W5/0      100.00 %    BERWYN    Wellhead; 3 phase vertical
seperator; Dry gas zedi metering unit; 400 bbl DW tank 102/10-17-084-22W5/0     
75.00 %    GRIMSHAW    Wellhead 100/09-14-094-25W5/0      100.00 %    HOTCHKISS
   Wellhead 100/12-16-083-12W6/0      31.60 %    BOUNDARY LAKE S    Wellhead; 2
phase vertical seperator; Dry gas zedi metering unit; 100 bbl DW tank
100/07-17-083-12W6/4      40.00 %    BOUNDARY LAKE S    Wellhead; 2 phase
vertical seperator; Dry gas zedi metering unit; 100 bbl DW tank
100/02-14-083-13W6/0      40.00 %    BOUNDARY LAKE S    Wellhead; 2 phase
vertical seperator; Dry gas zedi metering unit; 100 bbl DW tank
100/11-15-083-13W6/0      26.67 %    BOUNDARY LAKE S    Wellhead; 2 phase
vertical seperator; Dry gas zedi metering unit; 100 bbl DW tank
100/14-05-083-18W6/0      7.50 %    FT ST JOHN    Wellhead; 2 phase vertical
seperator; Dry gas meter run; 100 bbl DW tank 100/14-07-084-13W6/0      1.22 % 
  BOUNDARY LK    Wellhead; 2 phase vertical seperator; Conventional Pumpjack;
400 bbl SW tank 100/16-05-084-14W6/0      10.87 %    BOUNDARY LK    Wellhead; 2
phase vertical seperator; Conventional Pumpjack; 400 bbl SW tank

--------------------------------------------------------------------------------

100/06-07-084-14W6/0      13.29 %    BOUNDARY LK    Wellhead; 2 phase vertical
seperator; Conventional Pumpjack; 400 bbl SW tank 100/08-08-084-14W6/0      6.64
%    BOUNDARY LK    Wellhead; 2 phase vertical seperator; Conventional Pumpjack;
400 bbl SW tank 100/06-09-084-14W6/0      8.01 %    BOUNDARY LK    Wellhead; 2
phase vertical seperator; Conventional Pumpjack; 400 bbl SW tank
100/16-19-085-23W6/0      90.00 %    INGA    Wellhead; Conventional Pumpjack
100/01-30-110-07W6/0      50.00 %    RAINBOW    Wellhead 200/C-018-E/094-A-15/0
     50.00 %    MAPLE    Wellhead 200/D-079-F/094-H-03/0      1.75 %    UMBACH
   Wellhead; 2 phase vertical seperator; Dry gas meter run; 100 bbl DW tank
200/C-052-F/094-J-10/0      25.00 %    CLARKE LAKE    Wellhead; Wet Gas SCADA
metering unit 200/C-054-F/094-J-10/0      18.75 %    CLARKE LAKE    Wellhead;
Wet Gas SCADA metering unit 200/D-054-G/094-J-10/2      16.66 %    CLARKE LAKE
   Wellhead; Wet Gas SCADA metering unit 200/A-065-G/094-J-10/0      16.66 %   
CLARKE LAKE    Wellhead; Injection pump 200/D-066-G/094-J-10/0      9.38 %   
CLARKE LAKE    Wellhead; Wet Gas SCADA metering unit 200/B-074-G/094-J-10/2     
16.66 %    CLARKE LAKE    Wellhead; Injection pump

--------------------------------------------------------------------------------

ACCT
ID   Vessel
A #   CRN   Serial No   Location   Company
Code   Company
Area   Description   Volume   Heat
Surface   Surface
Area   Manufacturer   Year
Built  

Insp

Intrvl

 

Next

Insp

  In
Service  

Subject

To
Fees

  Subject
To Act   Fee   Track
#   Owner 10213     R0434.2   03081-2   LSD 7-36-14-21 W4M               AIR
COOLED EXCHANGERS, INC   2003       Y   N   N   0   87103   INTERNATIONAL
SOVEREIGN ENERGY CORP. 10213     L9315.52   270237.14   LSD 7-36-14-21 W4M      
VERTICAL PLATE & FRAME HEAT EXCHANGER         VIEX INC   2003       Y   N   N  
0   87104   INTERNATIONAL SOVEREIGN ENERGY CORP. 10213     L1488.2   80155401D  
LSD 7-36-14-21 W4M               TOROMONT PROCESS SYSTEMS DIV TOROMONT
INDUSTRIES   2003       N   N   N   0   87105   INTERNATIONAL SOVEREIGN ENERGY
CORP. 10213   0081738   C2310.2   QWL-539-70   LSD 4-18-64-9 W5M       PROCESS
VESSEL   0.07       QUALITY WELDING LTD   1974       Y   N   Y   0    
INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0093802   C5727.2   76C-747-A  
02-11-082-24 W5M       THREE PHASE SEPARATOR   1.47   0   0   ALCO MACHINE WORKS
INC   1976   1   2010-Aug-17   N   Y   Y   0     INTERNATIONAL SOVEREIGN ENERGY
CORP. 10213   0227889   H0611.2   LS-3727   14-31-014-21 W4M       DEHYDRATOR
TOWER   0.31       NATCO CANADA LTD   1987   0     Y   N   Y   0    
INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0406975   P0486.2   2019   LSD
16-30-38-2 W5M       16 INCH 3 PHASE SEPARATOR   0.31       PANAX OIL & GAS INC
  2000       Y   N   Y   0     INTERNATIONAL SOVEREIGN ENERGY CORP. 10213  
0476827   P0486.2   21086   LSD 15-25-14-21 W4M       16 INCH 1440 THREE PHASE
SEPARATOR   0.31       PANAX OIL & GAS INC   2001       Y   N   Y   0    
INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0491935   P0029.2   11157402   LSD
7-36-14-21 W4M   UNIT 11157-INT’L SOVEREIGN     OIL SEPARATOR   0.43      
TOROMONT PROCESS SYSTEMS DIV TOROMONT INDUSTRIES   2003       Y   N   Y   0    
INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0491968   L9030.2   11157401   LSD
7-36-14-21 W4M   UNIT 11157-INT’L SOVEREIGN     INLET SEPARATOR   1.27      
TOROMONT PROCESS SYSTEMS DIV TOROMONT INDUSTRIES   2003   1   2010-Jun-10   Y  
Y   Y   48     INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0518402   P3521.2  
24167   01-31-038-02 W5M       2 PHASE SEPARATOR   0.18       PANAX OIL & GAS
INC   2004   0   2010-Jun-09   Y   Y   Y   48     INTERNATIONAL SOVEREIGN ENERGY
CORP. 10213   0526357   P3799.2   25056   LSD 6-35-13-16 W4M       2 PHASE
SEPARATOR   0.02       PANAX OIL & GAS INC   2005   0   2010-Jun-10   Y   N   Y
  0     INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0527894   R3992.2  
V-2933-001D   102/02-25-038-02W5M       2 PHASE SEPARATOR   0.26       IPS
MANUFACTURING LIMITED   2005   0   2010-Jun-10   Y   N   Y   0     INTERNATIONAL
SOVEREIGN ENERGY CORP. 10213   0549126   P7298.2   25886   06-21-039-01W5M      
3 PHASE SEPARATOR   0.25       PANAX OIL & GAS INC   2006   0   2010-Jun-09   Y
  Y   Y   48     INTERNATIONAL SOVEREIGN ENERGY CORP. 10213   0579629   R5278.2
  17364-01   LSD 7-11-82-24 W5M       3 PHASE SEPARATOR   0.26       PLATINUM
ENERGY SERVICES CORP   2007   0   2010-Jun-09   Y   Y   Y   48     INTERNATIONAL
SOVEREIGN ENERGY CORP.

--------------------------------------------------------------------------------

SCHEDULE 3

GENERAL CONVEYANCE

--------------------------------------------------------------------------------

SCHEDULE 3

GENERAL CONVEYANCE

THIS GENERAL CONVEYANCE made effective as of the      of             , 2011.

BETWEEN:

INTERNATIONAL SOVEREIGN ENERGY CORP., a corporation incorporated under the laws
of Alberta (herein referred to as “ISR”)

– and –

LEGEND ENERGY CANADA LTD., a corporation existing under the laws of Alberta
(herein referred to as “Legend Canada”)

– and –

LEGEND OIL AND GAS LTD., a corporation existing under the laws of Colorado,
(herein referred to as “Legend O&G”)

OF THE FIRST PART

WHEREAS ISR, Legend Canada and Legend O&G are parties to the Purchase and Sale
Agreement made as of August     , 2011 (the “Purchase Agreement”) and pursuant
to the Purchase Agreement ISR has agreed to transfer and convey to Legend Canada
all of ISR’s right, title, interest and estate in and to the Purchased Assets;

NOW THEREFORE THIS AGREEMENT WITNESSES THAT, in consideration of the premises
and the respective covenants and agreements contained in the Purchase Agreement
and as are hereinafter set forth in this General Conveyance and other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties do covenant and agree with one another as follows:

 

1. Definitions

Unless otherwise indicated, capitalized terms used in this General Conveyance
have the meanings attributed to them in the Purchase Agreement.

 

2. Conveyance

ISR, pursuant to and for the consideration provided for in the Purchase
Agreement, the receipt and sufficiency of which is acknowledged by ISR, hereby
assigns, transfers, and conveys all of their present or future rights, titles,
interests, estates and claims of any kind in and to the Purchased Assets (other
than the Excluded Assets) to Legend Canada, TO HAVE AND TO HOLD the same
absolutely.

 

3. Non-Merger

The execution and delivery of this General Conveyance shall not operate as a
merger of the obligations, representations and warranties of Legend O&G and
Legend Canada contained in the Purchase Agreement, all of which shall survive
the Closing.

--------------------------------------------------------------------------------

4. Enurement

This General Conveyance enures to the benefit of and is binding upon the parties
and their respective heirs, executors, administrators, personal representatives,
successors and permitted assigns.

 

5. Governing Law

This General Conveyance shall be governed by and construed in accordance with
the laws of the Province of Alberta, and each of the parties submits to the
jurisdiction of the courts of the Province of Alberta for the interpretation and
enforcement thereof.

 

6. Further Assurances

Each of the parties shall from time to time and at all times on and after the
date hereof, without further consideration, do and perform all such further acts
and things, and execute and deliver all further agreements, assurances, deeds,
assignments, conveyances, notices, releases and other documents and instruments
as may reasonably be required to more fully assure the carrying out of the
intent and purpose of this General Conveyance.

 

7. Counterpart Execution:

This General Conveyance may be executed in any number of counterparts, each of
which shall be deemed an original and all of which taken together shall
constitute one and the same agreement. A counterpart execution page delivered
via facsimile or similar electronic means shall be as binding as an original
executed copy.

[THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF the parties have executed this Agreement as of the date first
above written.

INTERNATIONAL SOVEREIGN ENERGY CORP.:

 

Per:

 

 

 

Per:

 

 

 

LEGEND ENERGY CANADA LTD.

Per:

 

 

 

Per:

 

 

 

LEGEND OIL AND GAS LTD.

Per:

 

 

 

Per:

 

 

 

 

- 3 -

--------------------------------------------------------------------------------

SCHEDULE 4

MARWAYNE ASSETS

--------------------------------------------------------------------------------

AREA    LTYPE   FHCR   INT_TYPE   OPERATOR   EXPIRY(YYYYMMDD)     LOCATION      
DESCRIPT   RIGHTS   WELL_NO PARTNER     WIPERCENT   MARWAYNE    SL   FH   WI  
INTLSVRN     20220408      TWP 52-RGE   1-W4M   NW 28   Wellsite and access road
to 12-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH   WI   INTLSVRN
    20170409      TWP 52-RGE   1-W4M   NW 28   Wellsite and Access Road to
Constellation et al 14 C-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL  
FH   WI   INTLSVRN     20250620      TWP 52-RGE   1-W4M   NW 28   Wellsite and
access road to 11C-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH  
WI   INTLSVRN     20250620      TWP 52-RGE   1-W4M   NW 28   Wellsite and access
road to 13C-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH   WI  
INTLSVRN     20251107      TWP 52-RGE   1-W4M   NW 28   Wellsite and access road
to 12C-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH   WI  
INTLSVRN     20251107      TWP 52-RGE   1-W4M   NW 28   Wellsite and access road
to 12D-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH   WI  
INTLSVRN     20251107      TWP 52-RGE   1-W4M   NW 28   Wellsite and access road
to 13B-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH   WI  
INTLSVRN     20260909      TWP 52-RGE   1-W4M   NW 28   Wellsite and access road
to 12B-28-52-1-W4M     INTLSVRN        100    MARWAYNE    SL   FH   WI  
INTLSVRN     20280425      TWP 52-RGE   1-W4M   SW 28   Wellsite and Access Road
to 5B-28-52-1-W5M     INTLSVRN        100    MARWAYNE    SL   FH   WI   INTLSVRN
    20280527      TWP 52-RGE   1-W4M   NW 28   Wellsite and access road to
13-28-52-1-W4M     INTLSVRN        100   

--------------------------------------------------------------------------------

SCHEDULE 5

LOCK-UP AGREEMENT

--------------------------------------------------------------------------------

Draft 8/22/11

August     , 2011

LEGEND OIL & GAS LTD.

Common Stock

($0.001 Par Value)

International Sovereign Energy Corp.

1750, 801 – 6th Avenue SW

Calgary, AB T2P 3W2

CANADA

Ladies and Gentlemen:

This letter is being delivered to you in connection with the Asset Purchase
Agreement, dated             , 2011, among International Sovereign Energy Corp.,
an Alberta, Canada corporation, Legend Oil & Gas Ltd., a Colorado corporation
(“Legend”), and Legend Energy Canada Ltd., an [Alberta, Canada] corporation (the
“Agreement”). Capitalized terms used but not defined herein shall have the same
meaning ascribed to such terms in the Agreement.

In order to induce you to complete the transactions contemplated by the
Agreement, the undersigned agrees that during the period beginning on the
Closing Date and ending on the earlier of (i) the date that Legend Shares are
listed for trading or otherwise quoted on the NYSE Amex, NASDAQ, or any other
market more senior than the OTCBB and (ii) March 31, 2011 (in either case, such
period being referred to as the “Lock-Up Period”), the undersigned agrees that
it will not, without the prior written consent of Legend, (i) sell, offer to
sell, contract to sell, hypothecate, pledge, grant any option to sell or
otherwise dispose of, or establish or increase a put-equivalent position or
liquidate or decrease a call-equivalent position (within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder) with respect to any Common Shares
or any securities convertible into or exercisable or exchangeable for Common
Shares, (ii) enter into any swap or other arrangement that transfers to another,
in whole or in part, any of the economic consequences of ownership of Common
Shares, whether any such transaction is to be settled by delivery of Common
Shares or such other securities, in cash or otherwise, or (iii) publicly
announce an intention to effect any such transaction specified in clause (i) or
(ii).

Notwithstanding the foregoing, the undersigned may transfer the undersigned’s
Common Shares (i) as a bona fide gift or gifts, (ii) to any trust for the direct
or indirect benefit of the undersigned, (iii) to any stockholder of the
undersigned; provided, in each case, that (x) such transfer shall not involve a
disposition for value, (y) the transferee agrees in writing to be bound by the
terms of this Lock-Up Agreement, and (z) no filing by any party under
Section 16(a) of the Securities Exchange Act of 1934, as amended, shall be
required or shall be made voluntarily in connection with such transfer.

--------------------------------------------------------------------------------

Draft 8/22/11

 

Yours very truly,