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                                                                  EXHIBIT 10.37

                              EMPLOYMENT AGREEMENT

         This Employment Agreement ("Agreement") is entered into effective as of
February 26, 2004 (the "Effective Date"), by and between Continental Southern
Resources, Inc., a Nevada corporation (the "Company"), and William L. Transier
("Employee").

         WHEREAS, the Company wishes to employ Employee and Employee wishes to
be employed by the Company; and

         WHEREAS, the Company and Employee desire to enter into an agreement
reflecting the terms of the employment relationship, including the termination
thereof;

         NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties, and agreements contained herein, and for other
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree as follows:

         1. Effect of Agreement. Effective as of the Effective Date, this
Agreement supersedes and replaces any pre-existing employment agreements between
the Company and the Employee.

         2. Employment. The Company hereby employs Employee, and Employee hereby
accepts employment by the Company, on the terms and conditions set forth in this
Agreement.

         3. Term of Employment. Subject to the provisions for earlier
termination provided in this Agreement, the term of this Agreement (the "Term")
shall be three (3) years commencing on the Effective Date.

         4. Employee's Duties. During the Term of this Agreement, Employee shall
serve as Co-Chief Executive Officer, with such duties and responsibilities as
may from time to time be assigned to him by the board of directors of the
Company (the "Board"), provided that such duties are consistent with the
customary duties of such position. During the term of this Agreement, Employee
shall also serve as a member of the Board. Employee agrees to devote all of his
business time, skill and attention to the business and affairs of the Company
and to use reasonable best efforts to perform faithfully and efficiently his
duties and responsibilities. Employee shall not, either directly or indirectly,
enter into any business or employment with or for any person, firm, association
or corporation other than the Company during the Term of this Agreement;
provided, however, that Employee shall not be prohibited from making financial
investments in any other company or business, or, with notice to the Board, from
serving on the board of directors of any other company if such service does not
materially interfere with the performance of his duties or responsibilities
hereunder. Employee shall at all times observe and comply with all lawful
directions and instructions of the Board.

         5. Compensation.

               (a) Inducement Stock. As inducement to the Employee to enter into
         this Agreement, the Company will issue 500,000 shares ("Inducement
         Stock") of Company restricted common stock ("Restricted Stock") to the
         Employee as of the Effective Date.

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         The Inducement Stock grants shall be evidenced by the forms of
         Inducement Stock Agreement attached hereto as Exhibits "A" and "B."

               (b) Base Compensation. Beginning on January 1, 2005, for services
         rendered by Employee under this Agreement, the Company shall pay to
         Employee a base salary of $500,000 per annum ("Base Compensation").
         Subject to the availability of stock under the Company's 2004 Incentive
         Plan or any similar plan then in effect (the "Incentive Plan"), the
         Employee may make an annual election to take between 0% and 100% of his
         Base Compensation in the form of Restricted Stock (the "Salary Stock"),
         provided that he notifies the Company of his decision prior to the
         first pay period of each applicable year. For purposes hereof, the
         Salary Stock shall be valued at Fair Market Value, as that term is
         defined in the Incentive Plan and issued pursuant to the form of
         Restricted Stock Agreement attached hereto as Exhibit "B". Should
         insufficient shares be available under the Incentive Plan to grant the
         full amount of the Salary Stock, the remaining Base Compensation shall
         be paid in cash. The Base Compensation is payable in accordance with
         the Company's customary pay periods and subject to customary
         withholdings, including share withholdings as described in Section
         15(b) hereof. Issuance of the Salary Stock shall be accomplished in a
         manner to provide the most favorable accounting treatment for the
         Company. The amount of Base Compensation shall be reviewed by the Board
         on an annual basis as of the close of each fiscal year of the Company
         and may be increased as the Board may deem appropriate. In the event
         the Board (or, if established, the compensation committee thereof)
         deems it appropriate to increase Employee's annual base salary, said
         increased amount shall thereafter be the "Base Compensation."
         Employee's Base Compensation, as increased from time to time, may not
         thereafter be decreased unless agreed to by Employee. Nothing contained
         herein shall prevent the Board from paying additional compensation to
         Employee in the form of bonuses or otherwise during the Term of this
         Agreement.

         6. Bonus. With respect to each full fiscal year during the Employment
Term, the Board in its sole discretion may grant the Employee a discretionary
bonus ("Bonus"). The target bonus for each year shall be equal to the Base
Compensation; however, the Board may grant a maximum Bonus of up to 200% of the
Base Compensation payable in the form and in accordance with the Company's
customary pay periods for its annual bonuses for its executives and subject to
customary withholdings.

         7. Additional Benefits. In addition to the Base Compensation provided
for in Section 5 herein, Employee shall be entitled to the following:

               (a) Expenses. The Company shall, in accordance with any rules and
         policies that it may establish from time to time for executive
         officers, reimburse Employee for business expenses reasonably incurred
         in the performance of his duties. It is understood that Employee is
         authorized to incur reasonable business expenses for promoting the
         business of the Company, including reasonable expenditures for travel,
         lodging, meals and client or business associate entertainment. Request
         for reimbursement for such expenses must be accompanied by appropriate
         documentation.


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               (b) Vacation. Employee shall be entitled to five (5) weeks of
         vacation per year, without any loss of compensation or benefits.
         Employee shall not be entitled to compensation for, or to carry
         forward, any unused vacation time.

               (c) General Benefits. Employee shall be entitled to participate
         in the various employee benefit plans or programs, if any, provided to
         the officers of the Company in general, including but not limited to,
         health, dental, disability and life insurance plans, subject to the
         eligibility requirements with respect to each of such benefit plans or
         programs, and such other benefits or perquisites as may be approved by
         the Board during the Term of this Agreement. Nothing in this paragraph
         shall be deemed to prohibit the Company from making any changes in any
         of the plans, programs or benefits described in this Section 7,
         provided the change similarly affects all executive officers of the
         Company similarly situated.

               (d) Corporate Change. Upon the occurrence of a "Corporate Change"
         as hereinafter defined, Employee shall be considered as immediately and
         totally vested in any and all Restricted Stock, stock options or other
         similar awards previously made to Employee by the Company or its
         subsidiaries under a "Long Term Incentive Plan" or other grant duly
         adopted by the Board or the Compensation Committee thereof (such
         Restricted Stock, options or similar awards are hereinafter
         collectively referred to as "Options"). For purposes of this Agreement,
         a "Corporate Change" shall occur if (i) the Company (A) shall not be
         the surviving entity in any merger, consolidation or other
         reorganization (or survives only as a subsidiary of an entity other
         than a previously wholly-owned subsidiary of the Company) or (B) is to
         be dissolved and liquidated, and as a result of or in connection with
         such transaction, the persons who were directors of the Company before
         such transaction shall cease to constitute a majority of the Board, or
         (ii) any person or entity, including a "group" as contemplated by
         Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
         acquires or gains ownership or control (including, without limitation,
         power to vote) of 30% or more of the outstanding shares of the
         Company's voting stock (based upon voting power), and as a result of or
         in connection with such transaction, the persons who were directors of
         the Company before such transaction shall cease to constitute a
         majority of the Board, or (iii) the Company sells all or substantially
         all of the assets of the Company to any other person or entity (other
         than a wholly-owned subsidiary of the Company) in a transaction that
         requires shareholder approval pursuant to applicable corporate law; or
         (iv) during a period of two consecutive calendar years, individuals who
         at the beginning of such period constitute the Board, and any new
         director(s) whose election by the Board or nomination for election by
         the Company's stockholders was approved by a vote of at least a
         majority of the directors then still in office, who either were
         directors at the beginning of the two (2) year period or whose election
         or nomination for election was previously so approved, cease for any
         reason to constitute a majority of the Board; or (v) any other event
         that a majority of the Board, in its sole discretion, shall determine
         constitutes a Corporate Change hereunder.

         8. Confidential Information. Employee, during the Term, will have
access to and become familiar with confidential information, secrets and
proprietary information concerning the business and affairs of the Company, its
controlled subsidiaries and other controlled entities,


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including client and customer information, information concerning their
products, patent rights and know-how, and other technical information, business
strategies and pricing information, and other confidential and/or proprietary
information (collectively, "Confidential Information"). Confidential Information
shall not include (i) any information that is or becomes generally available to
the public other than as a result of Employee's improper or unauthorized
disclosure of such information in violation of this Agreement or (ii) was within
Employee's possession prior to its affiliation with the Company or its
controlled subsidiaries or other controlled entities (including his affiliation
with Endeavour International Operating Company, f/k/a NSNV, Inc. prior to its
acquisition by the Company). As to such Confidential Information, Employee
agrees as follows:

               (a) During the term of this Agreement or at any time following
         the termination of this Agreement, Employee will not, directly or
         indirectly, without the prior written consent of the Company (1)
         disclose or permit the disclosure of any such Confidential Information,
         or (2) use, reproduce or distribute, or make or permit any use,
         reproduction or distribution of, directly or indirectly, any such
         Confidential Information, except for any disclosure, use, reproduction
         or distribution that is required in the course of his employment with
         the Company, its controlled subsidiaries or other controlled entities.

               (b) If, during the term of this Agreement or at any time
         following the termination of this Agreement, Employee is requested or
         required (by oral question or request for information or documents, in
         any legal proceeding, interrogatory, subpoena, civil investigative
         demand, or similar process) to disclose any Confidential Information,
         Employee agrees to notify the Company immediately in writing of the
         request or requirement so that the Company may seek an appropriate
         protection order or waive compliance with the provisions of this
         Section. If, in the absence of a protective order or the receipt of a
         waiver under this Agreement, Employee is, on the advice of counsel,
         compelled to disclose any Confidential Information to any tribunal or
         else stand liable for contempt, Employee may disclose such Confidential
         Information to the tribunal; provided, however, that Employee shall use
         his commercially reasonable best efforts to obtain a court order or
         other assurance that confidential treatment will be accorded to such
         Confidential Information.

               (c) Upon termination of employment of Employee, for whatever
         reason, Employee shall surrender to the Company any and all documents,
         manuals, correspondence, reports, records and similar items then or
         thereafter coming into the possession of Employee which contain any
         Confidential Information of the Company or its controlled subsidiaries
         or other controlled entities.

               (d) Employee recognizes and acknowledges that the obligations of
         Employee contained in Section 8 of this Agreement are reasonable and
         necessary to protect the legitimate business interests of the Company,
         and that any breach or violation of any of the provisions of such
         Section is likely to result in irreparable injury to the Company for
         which the Company would have no adequate remedy at law. Employee agrees
         that if Employee shall breach or violate Section 8 of this Agreement,
         the Company shall be entitled, if it so elects, to institute and
         prosecute proceedings at law or in equity,


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         including, but not limited to, a proceeding seeking injunctive
         relief, to obtain damages with respect to such breach or violation, to
         enforce the specific performance of Section 8 this Agreement by
         Employee, or to enjoin Employee from engaging in any activity in
         violation of Section 8 of this Agreement. Employee acknowledges that in
         the event of any such breach or violation, the Company shall be
         entitled to preliminary and permanent injunctive relief, without the
         necessity of proving actual damages or posting a bond, and to an
         equitable accounting of all earnings, profits, and other benefits
         arising from any such breach or violation, which rights shall be
         cumulative and in addition to any other rights or remedies to which the
         Company may be entitled. Employee agrees that in the event of any such
         violation, an action may be commenced for preliminary or permanent
         injunctive relief and other equitable relief in any federal or state
         court of competent jurisdiction sitting in Harris County, Texas, or in
         any other court of competent jurisdiction. Employee waives, to the
         fullest extent permitted by law, any objection that Employee may now or
         hereafter have to such jurisdiction or to the laying of the venue of
         any such suit, action, or proceeding brought in such a court and any
         claim that such suit, action or proceeding has been brought in an
         inconvenient forum. Employee agrees that effective service of process
         may be made upon Employee under the notice provisions contained in
         Section 12 of this Agreement. Employee further agrees that the
         existence of any claim or cause of action against the Company, whether
         predicated upon a breach or violation by the Company of this Agreement
         or any other contract or agreement between Employee and the Company,
         shall not constitute or be asserted as a defense to the enforcement by
         the Company to the provisions of this Section relating to the Company's
         right to injunctive or other equitable relief for Employee's breach or
         violation of Section 8 of this Agreement.

         9. Termination. This Agreement may be terminated prior to the end of
its Term as set forth below:

               (a) Resignation (other than for Good Reason). Employee may
         resign, including by reason of retirement, his position at any time by
         providing written notice of resignation to the Company in accordance
         with Section 12 hereof. In the event of such resignation, except in the
         case of resignation for Good Reason (as defined below), this Agreement
         shall terminate and Employee shall not be entitled to further
         compensation pursuant to this Agreement other than the payment of any
         unpaid Base Compensation or Bonus accrued hereunder as of the date of
         Employee's resignation.

               (b) Death. If Employee's employment is terminated due to his
         death, this Agreement shall terminate and the Company shall have no
         obligations to Employee or his legal representatives with respect to
         this Agreement other than the payment of any unpaid Base Compensation
         or Bonus previously accrued hereunder.

               (c) Discharge.

                    (i) The Company may terminate Employee's employment only in
               the event of Employee's Misconduct or Disability (both as defined
               below) upon written notice thereof delivered to Employee in
               accordance with Section 9(f) and Section 12 hereof. In the event
               that Employee's employment is terminated during


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               the Term by the Company for any reason other than his Misconduct
               or Disability (both as defined below), then (A) the Company
               shall pay in lump sum in cash to Employee, within fifteen (15)
               days following the date of termination, an amount equal to the
               product of (i) Employee's Base Compensation as in effect
               immediately prior to Employee's termination (in the event a
               Corporate Change occurs prior to January 1, 2005, the Base
               Compensation shall be $500,000), multiplied by (ii) three, (B)
               for three years following the date of termination, the Company,
               at its cost, shall provide or arrange to provide Employee (and,
               as applicable, Employee's dependents) with accident and group
               health insurance benefits substantially similar to those which
               Employee (and Employee's dependents) were receiving immediately
               prior to Employee's termination (if any); however, the welfare
               benefits otherwise receivable by Employee pursuant to this clause
               (B) shall be reduced to the extent comparable welfare benefits
               are actually received by Employee (and/or Employee's dependents)
               during such period under any other employer's welfare plan(s) or
               program(s), with Employee being obligated to promptly disclose to
               the Company any such comparable welfare benefits, (C) in addition
               to the aforementioned compensation and benefits, the Company
               shall pay in lump sum in cash to Employee within fifteen (15)
               days following the date of termination an amount equal to the
               product of (i) Employee's average Bonus paid by the Company
               during the most recent two (2) years immediately prior to the
               date of termination (in the event that the date of termination is
               on or before December 31, 2004 and no Bonus has been paid with
               respect to the fiscal year ending December 31, 2004 as of the
               date of termination, the Bonus shall be equal to the Base
               Compensation for purposes of this section and in the event that
               the date of termination is after December 31, 2004 and on or
               before December 31, 2005 and no Bonus has been paid with respect
               to the fiscal year ending December 31, 2005, the Bonus with
               respect to the fiscal year ending December 31, 2005 shall be
               equal to the Base Compensation for purposes of this section),
               multiplied by (ii) three and (D) Employee shall be considered as
               immediately and totally vested in any and all Options previously
               made to Employee by Company or its subsidiaries.

                    (ii) In the event Employee is terminated because of
               Misconduct, the Company shall have no obligations pursuant to
               this Agreement after the Date of Termination other than the
               payment of any unpaid Base Compensation or Bonus accrued through
               the Date of Termination. As used herein, "Misconduct" means (A)
               the continued failure by Employee to substantially perform his
               duties with the Company (other than any such failure resulting
               from Employee's incapacity due to physical or mental illness or
               any such actual or anticipated failure after the issuance of a
               Notice of Termination by Employee for Good Reason), after a
               written demand for substantial performance is delivered to
               Employee by the Board, which demand specifically identifies the
               manner in which the Board believes that Employee has not
               substantially performed his duties, and the Employee fails to
               cure such failure within ten (10) days after receipt of such
               demand, (B) the engaging by Employee in conduct which is
               demonstrably and materially injurious to the Company, monetarily
               or otherwise (other than such conduct resulting from Employee's
               incapacity due to physical or mental illness or


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               any such actual or anticipated conduct after the issuance of
               a Notice of Termination by Employee for Good Reason), (C)
               Employee's conviction for the commission of a felony or (D)
               action by Employee toward the Company involving dishonesty.
               Anything contained in this Agreement to the contrary
               notwithstanding, the Board shall have the sole power and
               authority to terminate the employment of Employee on behalf of
               the Company

               (d) Disability. If Employee shall have been absent from the
         full-time performance of Employee's duties with the Company for ninety
         (90) consecutive calendar days as a result of Employee's incapacity due
         to physical or mental illness, Employee's employment may be terminated
         by the Company for "Disability" and Employee shall not be entitled to
         further compensation pursuant to this Agreement, except that Employee
         shall be considered as immediately and totally vested in any and all
         Options and restricted stock grants previously granted to Employee by
         Company or its subsidiaries.

               (e) Resignation for Good Reason. Employee shall be entitled to
         terminate his employment for Good Reason as defined herein. If Employee
         terminates his employment for Good Reason he shall be entitled to the
         compensation and benefits provided in Paragraph 9(c)(i) hereof. "Good
         Reason" shall mean the occurrence of any of the following circumstances
         without Employee's express written consent unless such breach or
         circumstances are fully corrected prior to the Date of Termination
         specified in the Notice of Termination given in respect hereof:

                    (i) the material breach of any of the Company's obligations
               under this Agreement without Employee's express written consent;

                    (ii) the continued assignment to Employee of any duties
               inconsistent with the office of Co-Chief Executive Officer not
               remedied within fifteen (15) days after the Company receives
               written notice of same from Employee;

                    (iii) the failure by the Company to pay to Employee any
               portion of Employee's compensation and such failure is not
               remedied within fifteen (15) days after the Company receives
               written notice of same from Employee;

                    (iv) the failure by the Company to continue to provide
               Employee with benefits substantially similar to those enjoyed by
               other executive officers who have entered into similar employment
               agreements with Employer under any of the Company's medical,
               health, accident, and/or disability plans in which Employee was
               participating immediately prior to such time;

                    (v) a change in the location of Employee's principal place
               of employment by the Company by more than 50 miles from the
               location where he was principally employed immediately prior to
               the date of such change; or

                    (vi) the failure of the Company to obtain a satisfactory
               agreement from any successor to assume and agree to perform this
               Agreement, as contemplated in Section 14 hereof.


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                           In addition, the occurrence of a Corporate Change,
                  shall constitute "Good Reason" hereunder, but only if Employee
                  terminates his employment within ninety (90) days following
                  the effective date of such Corporate Change.

               (f) Notice of Termination. Any purported termination of
         Employee's employment by the Company under Sections 9(c)(ii) or 9(d),
         or by Employee under Section 9(e), shall be communicated by written
         Notice of Termination to the other party hereto in accordance with
         Section 12 hereof. For purposes of this Agreement, a "Notice of
         Termination" shall mean a notice which, if by the Company and is for
         Misconduct or Disability, shall set forth in reasonable detail the
         reason for such termination of Employee's employment, or in the case of
         resignation by Employee for Good Reason, said notice must specify in
         reasonable detail the basis for such resignation. A Notice of
         Termination given by Employee pursuant to Section 9(e) shall be
         effective even if given after the receipt by Employee of notice that
         the Board has set a meeting to consider terminating Employee for
         Misconduct. Any purported termination for which a Notice of Termination
         is required which is not effected pursuant to this Section 9(f) shall
         not be effective.

               (g) Date of Termination. "Date of Termination" shall mean the
         date specified in the Notice of Termination, provided that the Date of
         Termination shall be at least 15 days following the date the Notice of
         Termination is given. Notwithstanding the foregoing, in the event
         Employee is terminated for Misconduct, the Company may refuse to allow
         Employee access to the Company's offices (other than to allow Employee
         to collect his personal belongings under the Company's supervision)
         prior to the Date of Termination.

               (h) Mitigation. Employee shall not be required to mitigate the
         amount of any payment provided for in this Section 9 by seeking other
         employment or otherwise, nor (except as set forth in Section
         9(c)(i)(B)) shall the amount of any payment provided for in this
         Agreement be reduced by any compensation earned or benefits received by
         Employee as a result of employment by another employer, except that any
         severance amounts payable to Employee pursuant to the Company's
         severance plan or policy for employees in general shall reduce the
         amount otherwise payable pursuant to Sections 9(c)(i) or 9(e).

               (i) Excess Parachute Payments. Notwithstanding anything in this
         Agreement to the contrary, to the extent that any payment or benefit
         received or to be received by Employee hereunder in connection with the
         termination of Employee's employment would, as determined by tax
         counsel selected by the Company, constitute an "Excess Parachute
         Payment" (as defined in Section 280G of the Internal Revenue Code), the
         Company shall fully "gross-up" such payment so that Employee is in the
         same "net" after-tax position he would have been if such payment and
         gross-up payments had not constituted Excess Parachute Payments.

               (j) Resignation from Board. In the event Employee's employment by
         the Company is terminated for any reason (other than Employee's death),
         Employee shall immediately resign as a member of the Board and the
         board of directors of any of the


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         Company's subsidiaries he may be a member of upon the written
         request of the Chairman of the Board. Nothing herein shall be deemed to
         limit the power of the shareholders of the Company to at any time
         remove any director, including, without limitation, Employee, in
         accordance with applicable law. All payments to Employees pursuant to
         this Agreement shall be conditioned upon Employee's compliance with his
         obligations under this Section 9(j).

         10. Non-exclusivity of Rights. Nothing in this Agreement shall prevent
or limit Employee's continuing or future participation in any benefit, bonus,
incentive, or other plan or program provided by the Company or any of its
affiliated companies and for which Employee may qualify, nor shall anything
herein limit or otherwise adversely affect such rights as Employee may have
under any Options with the Company or any of its affiliated companies.

         11. Assignability. The obligations of Employee hereunder are personal
and may not be assigned or delegated by him or transferred in any manner
whatsoever, nor are such obligations subject to involuntary alienation,
assignment or transfer. The Company shall have the right to assign this
Agreement and to delegate all rights, duties and obligations hereunder, either
in whole or in part, to any parent, affiliate, successor or subsidiary
organization or company of the Company, so long as the obligations of the
Company under this Agreement remain the obligations of the Company.

         12. Notice. For the purpose of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
Company at its principal office address, directed to the attention of the Board
with a copy to the Secretary of the Company, and to Employee at Employee's
residence address on the records of the Company or to such other address as
either party may have furnished to the other in writing in accordance herewith
except that notice of change of address shall be effective only upon receipt.

         13. Validity. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

         14. Successors; Binding Agreement.

               (a) The Company will require any successor (whether direct or
         indirect, by purchase, merger, consolidation or otherwise) to all or
         substantially all of the business and/or assets of the Company to
         expressly assume and agree to perform this Agreement in the same manner
         and to the same extent that the Company would be required to perform it
         if no such succession had taken place. Failure of the Company to obtain
         such agreement prior to the effectiveness of any such succession shall
         be a breach of this Agreement and shall entitle Employee to
         compensation from the Company in the same amount and on the same terms
         as he would be entitled to hereunder if he terminated his employment
         for Good Reason, except that for purposes of implementing the
         foregoing, the date on which any such succession becomes effective
         shall be deemed the Date of Termination. As used herein, the term
         "Company" shall include any successor to its


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         business and/or assets as aforesaid which executes and delivers
         the Agreement provided for in this Section 14 or which otherwise
         becomes bound by all terms and provisions of this Agreement by
         operation of law.

               (b) This Agreement and all rights of Employee hereunder shall
         inure to the benefit of and be enforceable by Employee's personal or
         legal representatives, executors, administrators, successors, heirs,
         distributees, devisees and legatees. If Employee should die while any
         amounts would be payable to him hereunder if he had continued to live,
         all such amounts, unless otherwise provided herein, shall be paid in
         accordance with the terms of this Agreement to Employee's devisee,
         legatee, or other designee or, if there be no such designee, to
         Employee's estate.

         15. Withholding Taxes.

               (a) Tax Withholding. The Company shall have the power and the
         right to deduct or withhold from any benefits payable under this
         Agreement an amount sufficient to satisfy federal, state, and local
         taxes, domestic or foreign, required by law or regulation to be
         withheld.

               (b) Share Withholding. With respect to tax withholding required
         upon the upon the lapse of restrictions on the Inducement Stock and the
         Salary Stock, or upon any other taxable event arising as a result of
         any stock awards pursuant to this Agreement, Employee may elect, to
         satisfy the withholding requirement, in whole or in part, by having the
         Company withhold shares having a Fair Market Value on the date the tax
         is to be determined equal to the minimum statutory total tax which
         could be imposed on the transaction. All such elections shall be made
         in writing, signed by the Employee, and shall be subject to any
         restrictions or limitations that the Company, in its discretion, deems
         appropriate. Any fraction of a share required to satisfy such
         obligation shall be disregarded and the Employee shall instead pay the
         amount due in cash.

         16. No Restraints. As an inducement to the Company to enter into this
Agreement, Employee represents and warrants that he is not a party to any other
agreement or obligation for personal services, and that there exist no
impediments or restraints, contractual or otherwise, on Employee's powers right
or ability to enter into this Agreement and to perform his duties and
obligations hereunder.

         17. Miscellaneous. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by Employee and such officer as may be specifically
authorized by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or in compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. This Agreement is an integration of the parties'
agreement; no agreement or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party, except those which are set forth expressly in this Agreement. THE
VALIDITY, INTERPRETATION, CONSTRUCTION AND PERFORMANCE OF THIS AGREEMENT SHALL
BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS.


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         18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

         19. Arbitration. Either party may elect that any dispute or controversy
arising under or in connection with this Agreement be settled by arbitration in
Houston, Texas in accordance with the rules of the American Arbitration
Association then in effect. If the parties cannot mutually agree on an
arbitrator, then the arbitration shall be conducted by a three arbitrator panel,
with each party selecting one arbitrator and the two arbitrators so selected
selecting a third arbitrator. The findings of the arbitrator(s) shall be final
and binding, and judgment may be entered thereon in any court having
jurisdiction. The findings of the arbitrator(s) shall not be subject to appeal
to any court, except as otherwise provided by applicable law. The arbitrator(s)
may, in his or her (or their) own discretion, award legal fees and costs to the
prevailing party.


                            [SIGNATURE PAGE FOLLOWS]


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<PAGE>


         IN WITNESS WHEREOF, the parties have executed this Agreement on
February 26, 2004 effective for all purposes as provided above.

                                      CONTINENTAL SOUTHERN RESOURCES, INC.

                                      By:  /s/ STEPHEN P. HARRINGTON
                                           ------------------------------------
                                      Name:   Stephen P. Harrington
                                              ---------------------------------
                                      Title:  President
                                              ---------------------------------


                                      EMPLOYEE:

                                      /s/ WILLIAM L. TRANSIER
                                      -----------------------------------------
                                      William L. Transier


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