<PAGE>   1
                                                                   EXHIBIT 10.10

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                        <C>                                         <C>
POWER EXPLORATION INC                                      BANK OF COMMERCE                            ACCOUNT #: 4174
5020 COLLINWOOD #201                                       P.O. BOX 17089/301 W. 7TH ST.               Loan Number 6176200
FT WORTH, TX 76107-3664                                    FORT WORTH, TX 76102                        Date JULY 29, 1998
                                                                                                       Maturity Date AUGUST 27, 1998
                                                                                                       Loan Amount $100,000.00
                                                                                                       Renewal Of ____________
           BORROWER'S NAME AND ADDRESS                          LENDER'S NAME AND ADDRESS              OFFICER: GG/GH
"I" includes each borrower above, joint and severally.     "You" means the lender, its successors and assigns.
------------------------------------------------------------------------------------------------------------------------------------
For value received, I promise to pay to you, or your order, at your address listed above the PRINCIPAL sum of ONE HUNDRED THOUSAND 
AND NO/100* * * * * * * * * * *Dollars $100,000.00
[ ] Single Advance: I will receive all of this principal sum on _______________. No additional advances are contemplated under this 
    note.
[X] Multiple Advance: The principal sum shown above is the maximum amount of principal I can borrow under this note. On JULY 29, 
    1998 I will receive the amount of $________________ and future principal advances are contemplated.
    Conditions: The conditions for future advances are AS REQUESTED 
    [ ] Open End Credit: You and I agree that I may borrow up to the maximum amount of principal more than one time. This feature 
        is subject to all other conditions and expires on ___________________________.
    [X] Closed End Credit: You and I agree that I may borrow up to the maximum only one time (and subject to all other conditions).
INTEREST: I agree to pay interest on the outstanding principal balance from JULY 29, 1998 at the rate of 9.500% per year until 
          AUGUST 27, 1998.
[ ] Variable Rate: This rate may then change as stated below.
    [ ] Index Rate: The future rate will be _________________ the following index rate: ____________________________________________
    ________________________________________________________________________________________________________________________________
    ________________________________________________________________________________________________________________________________
    [ ] Ceiling Rate: The interest rate ceiling for this note is the _________________ ceiling rate announced by the Credit 
        Commissioner from time to time.
    [ ] Frequency and Timing: The rate on this note may change as often as ________________________________________________________.
        A change in the interest rate will take effect ____________________________________________________________________________.
    [ ] Limitations: During the term of this loan, the applicable annual interest rate will not be more than _______________% or 
        less than ________________%. The rate may not change more than _______________% each _______________________________.
    Effect of Variable Rate: A change in the interest rate will have the following effect on the payments:
    [ ] The amount of each scheduled payment will change.       [ ] The amount of the final payment will change.
    [ ] ___________________________________________________________________________________________________________________________.
ACCRUAL METHOD: Interest will be calculated on a ACTUAL/360 basis.
POST MATURITY RATE: I agree to pay interest on the unpaid balance of this note owing after maturity, and until paid in full, as 
stated below:
    [ ] on the same fixed or variable rate basis in effect before maturity (as indicated above).
    [X] at a rate equal to THE HIGHEST RATE PERMITTED BY LAW.
[ ] LATE CHARGE: If a payment is made more than _________ days after it is due, I agree to pay a late charge of ____________________
    _______________________________________________________________________________________________________________________________.
[ ] ADDITIONAL CHARGES: In addition to interest, I agree to pay the following charges which [ ] are [ ] are not included in the 
    principal amount above: _______________________________________________________________________________________________________.
PAYMENTS: I agree to pay this note as follows:
[X] Interest: I agree to pay accrued interest ON DEMAND, BUT IF NO DEMAND IS MADE AT MATURITY 
[X] Principal: I agree to pay the principal ON DEMAND, BUT IF NO DEMAND IS MADE THEN ON AUGUST 27, 1998 
[ ] Installments: I agree to pay this note in ________ payments. The first payment will be in the amount of $_______________________
    and will be due ___________________________________________. A payment of $___________________ will be due _____________________
    __________________________________________________________________ thereafter. The final payment of the entire unpaid balance 
    of principal and interest will be due ____________________________________________________________________.
ADDITIONAL TERMS:

                                                            ------------------------------------------------------------------------
                                                            [X] SECURITY: This note is separately secured by (describe separate
                                                            document by type and date): LETTERS OF GUARANTY FROM M O RIFE III TRUST
                                                            A AND M O RIFE III DATED 7/29/98

                                                            (This section is for your internal use. Failure to list a separate
                                                            security document does not mean the agreement will not secure this
                                                            note.)
-------------------------------------------------------     ------------------------------------------------------------------------
THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE                PURPOSE: The purpose of this loan is BUSINESS: WORKING CAPITAL.
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.                  SIGNATURES: I AGREE TO THE TERMS OF THIS NOTE (INCLUDING THOSE ON PAGE 
                                                            2). I have received a copy on today's date.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE          
PARTIES.
-------------------------------------------------------

Signature for Lender                                        POWER EXPLORATION INC
                                                            ------------------------------------------------------------------------

X /s/ GENE GRAY                                             BY: /s/ PATTYE HILL
-------------------------------------------------------     ------------------------------------------------------------------------
GENE GRAY                                                   PATTYE HILL, SECRETARY

                                                            BY: /s/ JOE BILL BENNETT
-------------------------------------------------------     ------------------------------------------------------------------------
                                                            JOE BILL BENNETT, VICE PRESIDENT

                                                            ------------------------------------------------------------------------
</TABLE>

                                                                   (page 1 of 2)
<PAGE>   2
[    ] means the terms that apply to this loan. "I," "me" or "my" means each
Borrower who signs this note and each other person or legal entity (including
guarantors, endorsers, and sureties who agrees to pay this note (together
referred to as "us"). "You" or "your" means the Lender and its successors and
assigns.  

APPLICABLE LAW: The law of the state of Texas will govern this note. Any term of
this note which is contrary to applicable law will not be effective unless the
law permits you and me to agree to such a variation. If any provision of this
agreement cannot be enforced according to its terms, [ ] fact will not affect
the enforceability of the remainder of this agreement. No modification of this
agreement may be made without your express written consent. Time is of the
essence in this agreement.

PAYMENTS: Each payment I make on this note will first reduce the amount 
[     ] owe you for charges which are neither interest nor principal. The 
remainder of each payment will then reduce accrued unpaid interest, and then
unpaid principal. If you and I agree to a different application of payment, we
will describe our agreement on this note. I may prepay a part of, or the entire
balance of this law without penalty, unless we specify to the contrary on this
note. Any partial prepayment will not excuse or reduce any later scheduled
payment until this note is paid in full (unless, when I make the prepayment, you
and I agree in writing to the contrary).

INTEREST: Interest accrues on the principal remaining unpaid from time to time,
until paid in full. If a I receive the principal in more than one advance, each
advance will start to earn interest only when I receive the advance. The
interest rate in effect on this note at any given time will apply to the entire
principal advanced at that time. Notwithstanding anything to the contrary, I do
not agree to pay and you do not intend to charge any rate of interest that is
higher than the maximum rate of interest you could charge under applicable law
for the extension of credit that is agreed to here (either before or after
maturity). If any notice of interest accrual is sent and is in error, we
mutually agree to correct it, and if you actually collect more interest than
allowed by law and this agreement, you agree to refund it to me.

INDEX RATE: The index will serve only as a device for setting the rate on this
note. You do not guarantee by selecting this index, or the margin, that the rate
on this note will be the same rate you charge on any other loans or class of
loans to me or other borrowers.

ACCRUAL METHOD: The amount of interest that I will pay on this loan will be 
calculated using the interest rate and accrual method stated on page 1 of this 
note. For the purpose of interest calculation, the accrual method will 
determine the number of days in a "year." If no accrual method is stated, then 
you may use any reasonable accrual method for calculating interest.

POST MATURITY RATE: For purposes of deciding when the "Post Maturity Rate" 
(shown on page 1) applies, the term "maturity" means the date of the last 
scheduled payment indicated on page 1 of this note or the date you accelerate 
payment on the note, whichever is earlier.

SINGLE ADVANCE LOANS: If this is a single advance loan, you and I expect that 
you will make only one advance of principal. However, you may add other amounts 
to the principal if you make any payments described in the "PAYMENTS BY LENDER" 
paragraph below.

MULTIPLE ADVANCE LOANS: If this is a multiple advance loan, you and I expect 
that you will make more than one advance of principal. If this is closed end 
credit, repaying a part of the principal will not entitle me to additional 
credit.

PAYMENTS BY LENDER: If you are authorized to pay, on my behalf, charges I am
obligated to pay (such as property insurance premiums), then you may treat those
payments made by you as advances and add them to the unpaid principal under this
note, or you may demand immediate payment of the charges.

SET-OFF: I agree that you may set off any amount due and payable under this 
note against any right I have to receive money from you.

     "Right to receive money from you" means:

     (1) any deposit account balance I have with you;

     (2) any money owed to me on an item presented to you or in your possession
         for collection or exchange; and 

     (3) any purchase agreement or other nondeposit obligation.

     "Any amount due and payable under this note" means the total amount of
which you are entitled to demand payment under the terms of this note at the
time you set off. This total includes any balance the due date for which you
properly accelerate under this note.

     If my right to receive money from you is also owned by someone who has not
agreed to pay this note, your right of set-off will apply to my interest in the
obligation and to any other amounts I could withdraw on my sole request or
endorsement. Your right of set-off does not apply to an account or other
obligation where my rights are only as a representative. It also does not apply
to any Individual Retirement Account or other tax-deferred retirement account.

     You will not be liable for the dishonor of any check when the dishonor 
occurs because you set off this debt against any of my accounts. I agree to 
hold you harmless from any such claims arising as a result of your exercise of 
your right of set-off.

REAL ESTATE OR RESIDENCE SECURITY: If this note is secured by real estate or a 
residence that is personal property, the existence of a default and your 
remedies for such a default will be determined by applicable law, by the terms 
of any separate instrument creating the security interest and, to the extent 
not prohibited by law and not contrary to the terms of the separate security 
instrument, by the "Default" and "Remedies" paragraphs herein.

DEFAULT: I will be in default on this loan and any agreement securing this loan 
if any one or more of the following occurs:

     (1) I fail to perform any obligation which I have undertaken in this note 
         or any agreement securing this note; or

     (2) you, in good faith, believe that the prospect of payment or the 
         prospect of my performance of any other of my obligations under this
         note or any agreement securing this note is impaired.

     If any of us are in default on this note or any security agreement, you 
may exercise your remedies against any or all of us.

REMEDIES: If I am in default on this note you have, but are not limited to, 
the following remedies:
     
     (1) You may demand immediate payment of my debt under this note 
         (principal, accrued unpaid interest and other accrued charges).

     (2) You may set off this debt against any right I have to the payment of 
         money from you, subject to the terms of the "Set-Off" paragraph herein.

     (3) You may demand security, additional security, or additional parties to 
         be obligated to pay this note as a condition for not using any other 
         remedy.

     (4) You may refuse to make advances to me or allow purchases on credit by 
         me.

     (5) You may use any remedy you have under state or federal law.

     By selecting any one or more of these remedies you do not give up your 
right to later use any other remedy. By waiving your right to declare an event 
to be a default, you do not waive your right to later consider the event as a 
default if it continues or happens again.

COLLECTION COSTS AND ATTORNEY'S FEES: I agree to pay all costs of collection,
replevin or any other or similar type of cost if I am in default. In addition,
if you hire an attorney to collect this note, I also agree to pay any fee you
incur with such attorney plus court costs (except where prohibited by law). To
the extent permitted by the United States Bankruptcy Code, I also agree to pay
the reasonable attorney's fees and costs you incur to collect this debt as
awarded by any court exercising jurisdiction under the Bankruptcy Code.

WAIVER: I give up my rights to require you to do certain things. I will not 
require you to:

     (1) demand payment of amounts due (presentment);

     (2) obtain official certification of nonpayment (protest);

     (3) give notice that amounts due have not been paid (notice of dishonor);

     (4) give notice of intent to accelerate; or

     (5) give notice of acceleration.

     I waive any defenses I have based on suretyship or impairment of 
collateral.

OBLIGATIONS INDEPENDENT: I understand that I must pay this note even if someone
else has also agreed to pay it (by, for example, signing this form or a separate
guarantee or endorsement). You may sue me alone, or anyone else who is obligated
on this note, or any number of us together, to collect this note. You may do so
without any notice that it has not been paid (notice of dishonor). You may
without notice release any party to this agreement without releasing any other
party. If you give up any of your rights, with or without notice, it will not
affect my duty to pay this note. Any extension of new credit to any of us, or
renewal of this note by all or less than all of us will not release me from my
duty to pay it. (Of course, you are entitled to only one payment in full.) I
agree that you may at your option extend this note or the debt represented by
this note, or any portion of the note or debt, from time to time without limit
or notice and for any term without affecting my liability for payment of the
note. I will not assign my obligation under this agreement without your prior
written approval.

CREDIT INFORMATION: I agree and authorize you to obtain credit information 
about me from time to time (for example, by requesting a credit report) and to
report to others your credit experience with me (such as a credit reporting 
agency). I agree to provide you, upon request, any financial statement or 
information you may deem necessary. I warrant that the financial statements and 
information I provide to you are or will be accurate, correct and complete.

NOTICE: Unless otherwise required by law, any notice to me shall be given by 
delivering it or by mailing it by first class mail addressed to me at my last 
known address. My current address is on page 1. I agree to inform you in writing
of any change in my address. I will give any notice to you by mailing it first 
class to your address stated on page 1 of this agreement, or to any other 
address that you have designated.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
  DATE OF      PRINCIPAL     BORROWER'S      PRINCIPAL     PRINCIPAL    INTEREST    INTEREST    INTEREST
TRANSACTION     ADVANCE       INITIALS        PAYMENTS      BALANCE       RATE      PAYMENTS      PAID
                            (not required)                                                      THROUGH:
--------------------------------------------------------------------------------------------------------
<S>            <C>          <C>              <C>           <C>          <C>         <C>         <C>
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
  /  /         $                             $             $                   %    $             / /
--------------------------------------------------------------------------------------------------------
</TABLE>

                                                                   (page 2 of 2)