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                                Table of Contents

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                                                                    EXHIBIT 10.2

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                                    GUARANTY


                            HARKEN ENERGY CORPORATION
                                  ("Guarantor")


                               FOR THE BENEFIT OF


                               GUARANTY BANK, FSB
                                   ("Lender")


                                December 6, 2002

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

        CREDIT FACILITY TO HARKEN EXPLORATION COMPANY, XPLOR ENERGY, INC.
          HARKEN ENERGY WEST TEXAS, INC., SOUTH COAST EXPLORATION CO.,
                            XPLOR ENERGY SPV-1, INC.,
                         HARKEN GULF EXPLORATION COMPANY

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

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                               Table of Contents
                               -----------------
                                  (continued)

<TABLE>
<CAPTION>
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                                                                            ----
<S>                                                                         <C>
ARTICLE 1         General Terms ...........................................   1
  Section 1.1     Terms Defined Above .....................................   1
  Section 1.2     Terms Defined in Credit Agreement .......................   1
  Section 1.3     Additional Defined Terms ................................   1

ARTICLE 2         The Guaranty ............................................   2
  Section 2.1     Liabilities Guaranteed ..................................   2
  Section 2.2     Nature of Guaranty ......................................   2
  Section 2.3     Lender's Rights .........................................   2
  Section 2.4     Guarantor's Waivers .....................................   3
  Section 2.5     Maturity of Liabilities; Payment ........................   3
  Section 2.6     Lender's Expenses .......................................   3
  Section 2.7     Primary Liability .......................................   4
  Section 2.8     Subordination ...........................................   4
  Section 2.9     Events and Circumstances Not Reducing or Discharging
                  the Guarantor's Obligations .............................   4

ARTICLE 3         Representations and Warranties ..........................   6
  Section 3.1     By Guarantor ............................................   6

ARTICLE 4         Miscellaneous ............................................  7
  Section 4.1     Successors and Assigns ...................................  7
  Section 4.2     Reliance on Guaranty Agreement ...........................  7
  Section 4.3     Full Review ..............................................  7
  Section 4.4     Notices ..................................................  7
  Section 4.5     CONSTRUCTION .............................................  8
  Section 4.6     JURISDICTION .............................................  8
  Section 4.7     WAIVER OF RIGHTS TO JURY TRIAL ...........................  8
  Section 4.8     ENTIRE AGREEMENT .........................................  8
</TABLE>

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                               GUARANTY AGREEMENT

         THIS GUARANTY AGREEMENT is executed this 6th day of December, 2002,by
and between HARKEN ENERGY CORPORATION, a Delaware corporation (hereinafter
referred to as the "Guarantor"), whose address for purposes hereof is 580
Westlake Park Boulevard, Suite 600, Houston, Texas 77079 and GUARANTY BANK, FSB,
a federal savings bank, whose address is 333 Clay Street, Suite 4400, Houston,
Texas 77002 (hereinafter referred to as the "Lender").

                              W I T N E S S E T H:

         WHEREAS, HARKEN EXPLORATION COMPANY, a Delaware corporation, XPLOR
ENERGY, INC., a Texas corporation, HARKEN ENERGY WEST TEXAS, INC., a Delaware
corporation, SOUTH COAST EXPLORATION CO., a Texas corporation, XPLOR ENERGY
SPV-1, INC., an Oklahoma corporation, and HARKEN GULF EXPLORATION COMPANY, a
Delaware corporation (hereinafter referred to collectively as the "Borrower")
and the Lender have entered into the Credit Agreement of even date herewith (as
amended, restated, or supplemented from time to time, the "Credit Agreement")
pursuant to which the Lender has agreed, upon the terms and conditions set forth
therein, to make Loans (as such term is defined in the Credit Agreement and so
used herein) to the Borrower from time to time; and

         WHEREAS, as an inducement to the Lender to extend credit to the
Borrower and in satisfaction of a condition precedent provided in the Credit
Agreement, the Guarantor has agreed to execute this Guaranty Agreement in favor
of the Lender;

         NOW, THEREFORE, in order to comply with the terms and conditions of the
Credit Agreement and in consideration of the premises and the extension of
credit by the Lender to the Borrower pursuant to the Credit Agreement and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor hereby agrees as follows:

                                    ARTICLE 1

                                  General Terms

         Section 1.1 Terms Defined Above. As used in this Guaranty Agreement,
the terms "Borrower," "Credit Agreement," "Guarantor," and "Lender" shall have
the meanings indicated above.

         Section 1.2 Terms Defined in Credit Agreement. As used in this Guaranty
Agreement, each term defined in the Credit Agreement shall have the meaning
assigned to such term in the Credit Agreement, unless expressly provided to the
contrary herein.

         Section 1.3 Additional Defined Terms. As used in this Guaranty
Agreement, each of the following terms shall have the meaning assigned to such
term below, unless the context otherwise requires:

         "Guarantor Collateral" shall have the meaning indicated in Section 4.1
hereof.

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         "Guaranty Agreement" shall mean this Guaranty Agreement, as the same
         may be amended, supplemented, or restated from time to time in writing.

         "Liabilities" shall have the meaning indicated in Section 2.1 hereof.

                                   ARTICLE 2

                                  The Guaranty

         Section 2.1 Liabilities Guaranteed. The Guarantor hereby
unconditionally and irrevocably guarantees the prompt payment when due, whether
at maturity or upon the occurrence and continuation of an Event of Default under
the Credit Agreement, of the Obligations (hereinafter referred to as the
"Liabilities"). The Liabilities shall also include all Obligations which would
be owed by the Borrower but for the fact that they are determined to be void,
unenforceable, uncollectible, or not allowable for any reason against the
Borrower, including, without limitation, under any Insolvency Proceeding of the
Borrower.

         Section 2.2 Nature of Guaranty. This is an irrevocable, absolute,
completed, and continuing guaranty of payment and not a guaranty of collection,
and no notice of the Liabilities or any extension of credit already or hereafter
contracted by or extended to the Borrower need be given to the Guarantor. The
Liabilities may be rearranged, increased, reduced, extended for any period,
and/or renewed from time to time, or paid in full without notice to the
Guarantor; and such events shall not release, discharge, or reduce the
obligation of the Guarantor with respect to the Liabilities, and the Guarantor
shall remain fully bound hereunder notwithstanding the occurrence of such
events. In the event that the Lender must rescind or restore any payment
received by such Lender in satisfaction of the Liabilities, as set forth herein,
any prior release or discharge from the terms of this Guaranty Agreement given
to the Guarantor by such Lender shall be without effect, and this Guaranty
Agreement shall continue to be effective or shall be reinstated, as the case may
be. It is the intention of the Borrower and the Guarantor that obligations of
the Guarantor hereunder shall not be discharged except by the Guarantor's
performance of such obligations and then only to the extent of such performance.
This Guaranty Agreement shall not be discharged by the assignment or negotiation
of all or part of the Liabilities. This Guaranty Agreement may not be revoked by
the Guarantor and shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Liabilities is rescinded or
must otherwise be returned by the Lender upon the insolvency, bankruptcy,
reorganization, receivership, or other debtor relief proceeding involving the
Borrower, or after any attempted revocation by the Guarantor, all as though such
payment had not been made. The Guarantor hereby expressly waives presentment,
demand, notice of non-payment, notice of intent to accelerate, notice of
acceleration, protest, notice of protest and dishonor, or any other notice
whatsoever on any and all forms of such Liabilities, and also notice of
acceptance of this Guaranty Agreement.

         Section 2.3 Lender's Rights. The Guarantor authorizes the Lender,
without notice or demand and without affecting the Guarantor's liability
hereunder, to take and hold security for the payment of this Guaranty Agreement
and/or any of the Liabilities, and exchange, enforce, waive, and release any
such security; and to apply such security and direct the order or manner of sale
thereof as the Lender in its discretion may determine; and to obtain a guaranty
of the Liabilities from any one or more Persons and at any time or times to
enforce, waive, rearrange, modify, limit, or

                                       2

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release any of such other Persons from their obligations under such guaranties,
and the Guarantor hereby acknowledges and agrees that the obligations of all
Persons to pay and satisfy the Liabilities pursuant to their respective
guaranties (including the Guarantor's obligations under this Guaranty Agreement)
shall be joint and several.

         Section 2.4 Guarantor's Waivers. The Guarantor waives any right to
require the Lender to (and it shall not be necessary for the Lender, in order to
enforce such payment by the Guarantor to first) (a) proceed against the Borrower
or any other Person liable on the Liabilities, (b) proceed against or exhaust
any security given to secure the Liabilities, (c) have the Borrower joined with
the Guarantor in any suit arising out of this Guaranty Agreement and/or any of
the Liabilities, (d) enforce its rights against any other guarantor of the
Liabilities, or (e) pursue or exhaust any other right in the Lender's power
whatsoever. The Lender shall not be required to mitigate damages or take any
action to reduce, collect, or enforce the Liabilities. The Guarantor waives any
defense arising by reason of any disability, lack of authority or power, or
other defense of the Borrower or any other guarantor of any of the Liabilities,
and shall remain liable hereon regardless of whether the Borrower or any other
guarantor is found not liable thereon for any reason including, without
limitation, disability, bankruptcy, insolvency, reorganization, dissolution, or
operation of law, even though rendering the Liabilities void or unenforceable or
uncollectible as against the Borrower or any other guarantor. Prior to the
payment in full of the Liabilities and, in any event, not until 367 days after
the making of any payment and/or the granting of any Lien to secure all or any
part of the Liabilities by any Person, (x) the Guarantor shall have no right of
subrogation, and waives any right to enforce any remedy which the Lender now has
or may hereafter have against the Borrower, and waives any benefit of any right
to participate in any security now or hereafter held by the Lender, (y) the
Guarantor hereby waives any obligation of the Borrower to pay, reimburse, or
otherwise compensate the Guarantor for any payments the Guarantor may have to
make to the Lender pursuant to this Guaranty Agreement, and (z) in addition, the
Guarantor hereby waives any right or claim it now has or may hereafter have
against the Borrower in connection with any payments which the Guarantor may
have to make to the Lender pursuant to this Guaranty Agreement.

         Section 2.5 Maturity of Liabilities; Payment. The Guarantor agrees that
if the maturity of any Liabilities is accelerated by bankruptcy or otherwise,
such maturity shall also be deemed accelerated for the purpose of this Guaranty
Agreement without demand or notice to the Guarantor. The Guarantor will,
forthwith upon notice from the Lender of the Borrower's failure to pay any
Liabilities when due, pay to the Lender at its Principal Office, the amount due
and unpaid by the Borrower and guaranteed hereby. The failure of the Lender to
give this notice shall not in any way release the Guarantor hereunder.

         Section 2.6 Lender's Expenses. If the Guarantor fails to pay the
Liabilities after notice from the Lender of the Borrower's failure to pay any
Liabilities when due, and if the Lender obtains the services of an attorney for
collection of amounts owing by the Guarantor hereunder, or if suit is filed to
enforce this Guaranty Agreement, or if proceedings are had in any bankruptcy,
probate, receivership, or other judicial proceeding for the establishment or
collection of any amount owing by the Guarantor hereunder, or if any amount
owing by the Guarantor hereunder is collected through such proceedings, the
Guarantor agrees to pay to the Lender at its Principal Office all court costs
and all reasonable attorneys' fees incurred by the Lender.

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         Section 2.7  Primary Liability. It is expressly agreed that the
liability of the Guarantor for the payment of the Liabilities guaranteed hereby
shall be primary and not secondary.

         Section 2.8  Subordination. The Guarantor hereby subordinates (in
liquidation, dissolution, bankruptcy, reorganization, or otherwise) all sums due
and owing to the Guarantor by the Borrower to all sums due and owing to the
Lender by the Borrower.

         Section 2.9  Events and Circumstances Not Reducing or Discharging the
Guarantor's Obligations. The Guarantor hereby consents and agrees to each of the
following, and agrees that the Guarantor's obligations under this Guaranty
Agreement shall not be released, diminished, impaired, reduced, or adversely
affected by any of the following, and waives any rights (including, without
limitation, rights to notice) which the Guarantor might otherwise have as a
result of or in connection with any of the following:

                  (a) Modifications, etc. Any renewal, extension, modification,
         alteration, or rearrangement of all or any part of the Liabilities, the
         Loan Documents, or any instrument executed in connection therewith, or
         any contract or understanding between the Borrower and the Lender, or
         any other parties, pertaining to the Liabilities;

                  (b) Adjustment, etc. Any adjustment, indulgence, forbearance,
         or compromise that might be granted or given by the Lender to the
         Borrower or the Guarantor;

                  (c) Condition of Borrower or Guarantor. The insolvency,
         bankruptcy, arrangement, adjustment, composition, liquidation,
         disability, dissolution, or lack of power of the Borrower or any other
         party at any time liable for the payment of all or part of the
         Liabilities; or any dissolution of the Borrower, or any sale, lease, or
         transfer of any or all of the assets of the Borrower or the Guarantor;
         or any reorganization of the Borrower or the Guarantor;

                  (d) Invalidity of Liabilities. The invalidity, illegality, or
         unenforceability of all or any part of the Liabilities, or any document
         or agreement executed in connection with the Liabilities, for any
         reason whatsoever, including, without limitation, the fact that the
         Liabilities, or any part thereof, exceed the amount permitted by law,
         the act of creating the Liabilities or any part thereof is ultra vires,
         the officers, partners, or representatives executing the documents or
         otherwise creating the Liabilities acted in excess of their authority,
         the Liabilities violate applicable usury laws, the Borrower has valid
         defenses, claims, or offsets (whether at law, in equity or by
         agreement) which render the Liabilities wholly or partially
         uncollectible from the Borrower, the creation, performance, or
         repayment of the Liabilities (or the execution, delivery, and
         performance of any document or instrument representing part of the
         Liabilities or executed in connection with the Liabilities, or given to
         secure the repayment of the Liabilities) is illegal, uncollectible,
         legally impossible, or unenforceable, or the Credit Agreement or other
         Loan Documents or other instruments pertaining to the Liabilities have
         been forged or otherwise are irregular or not genuine or authentic;

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                  (e) Release of Obligors. Any inadvertent or unintentional full
         or partial release of the liability of the Borrower on the Liabilities
         or any part thereof, or any full or partial release of the liability of
         any coguarantor, or any other Person now or hereafter liable, whether
         directly or indirectly, jointly, severally, or jointly and severally,
         to pay, perform, guarantee, or assure the payment of the Liabilities or
         any part thereof, it being recognized, acknowledged, and agreed by the
         Guarantor that the Guarantor may be required to pay the Liabilities in
         full without assistance or support of any other Person, and the
         Guarantor has not been induced to enter into this Guaranty Agreement on
         the basis of an understanding or agreement that other Persons will be
         liable to perform the Liabilities, or the Lender will look to other
         Persons to perform the Liabilities;

                  (f) Other Security. The taking or accepting of any other
         security, collateral, or guaranty, or other assurance of payment, for
         all or any part of the Liabilities;

                  (g) Release of Collateral, etc. Any release, surrender,
         exchange, subordination, deterioration, waste, loss, or impairment
         (including, without limitation, negligent, willful, unreasonable, or
         unjustifiable impairment) of any Collateral, Guarantor Collateral,
         Property or security, at any time existing in connection with or
         assuring or securing payment of, all or any part of the Liabilities;

                  (h) Care and Diligence. The failure of the Lender or any other
         Person to exercise diligence or reasonable care in the preservation,
         protection, enforcement, sale, or other handling or treatment of all or
         any part of such Collateral, Guarantor Collateral, Property, or
         security;

                  (i) Status of Liens. The fact that any Collateral, Guarantor
         Collateral, security, security interest, or Lien contemplated or
         intended to be given, created, or granted as security for the repayment
         of the Liabilities shall not be properly perfected or created, or shall
         prove to be unenforceable or subordinate to any other security interest
         or Lien, it being agreed by the Guarantor that the Guarantor is not
         entering into this Guaranty Agreement in reliance on, or in
         contemplation of the benefits of, the validity, enforceability,
         collectibility, or value of any of the Collateral and/or Guarantor
         Collateral;

                  (j) Preference. Any payment by the Borrower to the Lender is
         held to constitute a preference under bankruptcy laws, or for any
         reason the Lender is required to refund such payment or pay such amount
         to the Borrower or some other Person; or

                  (k) Other Actions Taken or Omitted. Any other action taken or
         omitted to be taken with respect to the Credit Agreement, the other
         Loan Documents, the Liabilities, or the security and Collateral
         therefor, whether or not such action or omission prejudices the
         Guarantor or increases the likelihood that the Guarantor will be
         required to pay the Liabilities pursuant to the terms hereof; it is the
         unequivocal intention of the Guarantor that the Guarantor shall be
         obligated to pay the Liabilities

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         when due, notwithstanding any occurrence, circumstance, event, action,
         or omission whatsoever, whether or not contemplated, and whether or not
         otherwise or particularly described herein, except for the full and
         final payment and satisfaction of the Liabilities.

                                   ARTICLE 3

                         Representations and Warranties

         Section 3.1 By Guarantor. In order to induce the Lender to accept this
Guaranty Agreement, the Guarantor represents and warrants to the Lender (which
representations and warranties will survive the creation of the Liabilities and
any extension of credit thereunder) that:

                  (a) Benefit to the Guarantor. (i) The Guarantor has determined
         that it will benefit from the Loans extended to the Borrower pursuant
         to the Credit Agreement, and (ii) the Guarantor has further determined
         that it will benefit from its entry into, and performance of, the
         provisions of this Guaranty Agreement, and that such actions are in the
         best interests of the Guarantor;

                  (b) Existence. The Guarantor is a corporation duly organized,
         legally existing, and in good standing under the laws of the State of
         Delaware, and is duly qualified as a foreign corporation and is in good
         standing in all jurisdictions wherein the ownership of Property or the
         operation of its business necessitates same;

                  (c) Power and Authorization. The execution and delivery of
         this Guaranty Agreement by the Guarantor and the performance of the
         obligations of the Guarantor under this Guaranty Agreement and the
         other Loan Documents to which it is a party are within the power of the
         Guarantor and have been duly authorized by all necessary corporate
         action;

                  (d) Binding Obligations. This Guaranty Agreement constitutes
         valid and binding obligations of the Guarantor, enforceable in
         accordance with its terms;

                  (e) No Legal Bar or Resultant Lien. The execution and delivery
         of this Guaranty Agreement by the Guarantor and the performance of the
         obligations of the Guarantor under this Guaranty Agreement and the
         other Loan Documents to which they are a party do not and will not (a)
         contravene or conflict with any Requirement of Law, (b) contravene or
         conflict with any indenture, instrument, or other agreement to which
         the Guarantor is a party or by which any Property of the Guarantor may
         be presently bound or encumbered, or (c) result in or require the
         creation or imposition of any Lien in, upon or of any Property of the
         Guarantor under any such indenture, instrument, or other agreement,
         other than pursuant to this Guaranty Agreement or the other Loan
         Documents to which it is a party;

                  (f) No Consent. The execution and delivery of this Guaranty
         Agreement by the Guarantor and the performance of the obligations of
         the Guarantor under this Guaranty Agreement and the other Loan
         Documents to which it is a party do not

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         require the consent or approval of any other Person, including, without
         limitation, any Governmental Authority;

                  (g) Familiarity and Reliance. The Guarantor is familiar with,
         and has independently reviewed books and records regarding, the
         financial condition of the Borrower and is familiar with the value of
         any and all Collateral intended to be created as security for payment
         of the Notes and the Liabilities; provided, however, the Guarantor is
         not relying on such financial condition or the Collateral as an
         inducement to enter into this Guaranty Agreement;

                  (h) No Representation. Neither the Lender nor any other Person
         has made any representation, warranty, or statement to the Guarantor
         with regard to the Borrower or its financial condition in order to
         induce the Guarantor to execute this Guaranty Agreement; and

                  (i) Guarantor's Financial Condition. As of the date hereof and
         after giving effect to this Guaranty Agreement and the contingent
         liability evidenced hereby, the Guarantor is and will be solvent, and
         has assets which, fairly valued, exceed the Indebtedness.

                                    ARTICLE 4

                                  Miscellaneous

         Section 4.1  Successors and Assigns. This Guaranty Agreement is and
shall be in every particular available to the legal representatives, successors,
and assigns of the Lender, and in the event of an assignment of the Liabilities,
or any part thereof, the rights and benefits hereunder, to the extent applicable
to the indebtedness so assigned, may be transferred with such indebtedness, and
is and shall always be fully binding upon the legal representatives, successors,
and assigns of the Guarantor, notwithstanding that some or all of the monies,
the repayment of which this Guaranty Agreement applies, may be actually advanced
after any bankruptcy, receivership, reorganization, or other event affecting the
Guarantor.

         Section 4.2  Reliance on Guaranty Agreement. The Guarantor recognizes
that the Lender is relying upon this Guaranty Agreement and the undertakings of
the Guarantor hereunder in making an extension of credit to the Borrower under
the Credit Agreement and further recognizes that the execution and delivery of
this Guaranty Agreement are material inducements to the Lender in entering into
the Credit Agreement.

         Section 4.3  Full Review. This Guaranty Agreement was reviewed by the
Guarantor and the Guarantor acknowledges that it (a) understands fully all of
the terms of this Guaranty Agreement and the consequences and implications of
the Guarantor's execution of this Guaranty Agreement, and (b) has been afforded
an opportunity to have this Guaranty Agreement reviewed by, and to discuss the
terms, consequences, and implications of this Guaranty Agreement with, an
attorney or such other Persons as the Guarantor may have desired.

         Section 4.4  Notices. Any notice or demand to the Guarantor under or in
connection with this Guaranty Agreement shall be in writing and mailed by first
class or express mail, postage

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prepaid, or sent by telex, telegram, telecopy or other similar form of rapid
transmission confirmed by mailing (by first class or express mail, postage
prepaid) written confirmation at substantially the same time as such rapid
transmission, or personally delivered to the Guarantor. All such communications
shall be mailed, sent, or delivered to the Guarantor at the address of the
Guarantor appearing on the records of the Lender. Any communication so addressed
and mailed shall be deemed to be given when so mailed; any notice so sent by
rapid transmission shall be deemed to be given when receipt of such transmission
is acknowledged; any communication so delivered in person shall be deemed to be
given when receipted for by, or actually received by, the Guarantor.

         Section 4.5 CONSTRUCTION. THIS GUARANTY AGREEMENT IS A CONTRACT MADE
UNDER AND SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF TEXAS.

         Section 4.6 JURISDICTION. ALL ACTIONS OR PROCEEDINGS WITH RESPECT TO
THIS GUARANTY AGREEMENT MAY BE INSTITUTED AT THE DISCRETION OF THE LENDER IN THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS. BY EXECUTION
AND DELIVERY OF THIS GUARANTY AGREEMENT, THE GUARANTOR IRREVOCABLY AND
UNCONDITIONALLY SUBMITS TO THE JURISDICTION (BOTH SUBJECT MATTER AND PERSONAL)
OF SUCH COURT, AND IRREVOCABLY AND UNCONDITIONALLY WAIVES (A) ANY OBJECTION THE
GUARANTOR MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN SUCH COURT, AND
(B) ANY CLAIM THAT ANY ACTION OR PROCEEDING BROUGHT OF SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.

         Section 4.7 WAIVER OF RIGHTS TO JURY TRIAL. THE GUARANTOR AND THE
LENDER HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, IRREVOCABLY, AND
UNCONDITIONALLY WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT,
PROCEEDING, COUNTERCLAIM, OR OTHER LITIGATION THAT RELATES TO OR ARISES OUT OF
ANY OF THIS GUARANTY AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE ACTS OR
OMISSIONS OF THE LENDER IN THE ENFORCEMENT OF ANY OF THE TERMS OR PROVISIONS OF
THIS GUARANTY AGREEMENT OR ANY OTHER LOAN DOCUMENT OR OTHERWISE WITH RESPECT
THERETO. THE PROVISIONS OF THIS SECTION ARE A MATERIAL INDUCEMENT FOR THE LENDER
EXTENDING CREDIT TO THE BORROWER.

         Section 4.8 ENTIRE AGREEMENT. THIS GUARANTY AGREEMENT CONSTITUTES THE
ENTIRE AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT TO THE SUBJECT HEREOF
AND SHALL SUPERSEDE ANY PRIOR AGREEMENT BETWEEN THE PARTIES HERETO, WHETHER
WRITTEN OR ORAL, RELATING TO THE SUBJECT HEREOF. FURTHERMORE, IN THIS REGARD,
THIS GUARANTY AGREEMENT AND THE OTHER WRITTEN LOAN DOCUMENTS REPRESENT,
COLLECTIVELY, THE FINAL AGREEMENT AMONG THE PARTIES THERETO AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF SUCH PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG SUCH
PARTIES.

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         EXECUTED this 6/th/ day of December, 2002.

                                            GUARANTOR:

                                            HARKEN ENERGY CORPORATION


                                            By: /s/ Anna Williams
                                                -----------------
                                                    Executive Vice President and
                                                    Chief Financial Officer

                                            LENDER:

                                            GUARANTY BANK, FSB


                                            By: /s/ Jonathan Gregory
                                                --------------------
                                                    Jonathan Gregory
                                                    Vice President

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