PROMISSORY NOTE


$120,000.00                                               Date: August 25, 1998

For value received, the undersigned COLORADO WYOMING RESERVE COMPANY ("the
Borrower"), with an address at 751 Horizon Court, Suite 205, Grand Junction,
Colorado 81506, promises to pay to the order of James E. Moore Revocable Trust
u/d/t/ dated July 28, 1994 (the "Lender"), at 7827 Berger Avenue, Playa del Rey,
California 90293 (or at such other place as the Lender may designate in
writing), the sum of $120,000.00, together with interest from the date of the
advance of the principal amount of this Note to the Borrower, on the unpaid
principal at the rate of 6.00% per annum.

The unpaid principal and accrued interest shall be payable in full on the
earlier of (i) the receipt by the Borrower of any proceeds from public or
private sale of any its capital stock or other securities or (ii) October 31,
1998 (the "Due Date").

All payments on this Note shall be applied first in payment of accrued interest
and any remainder in payment of principal.

The Borrower reserves the right to prepay this Note (in whole or in part) prior
to the due date with no prepayment penalty.

If any payment obligation under this Note is not paid when due, the Borrower
promises to pay all costs of collection, including reasonable attorney fees,
whether or not a lawsuit is commenced as part of the collection process.

This Note is made pursuant to the Loan Agreement dated as of August 25, 1998
between Lender and Borrower. To the extent of any conflict between this Note and
the Loan Agreement, the provisions of this Note shall be controlling.

This Note is secured by a Mortgage, Deed of Trust, Security Agreement and
Financing Statement dated as of August 25, 1998. The Lender is not required to
rely on the above security for the payment of this Note in the case of default,
but may proceed directly against the Borrower.

If any of the following events of default occur, this Note and any other
obligations of the Borrower to the Lender, shall become due immediately, without
demand or notice:

   1)     the failure of the Borrower to pay the principal and any accrued
          interest in full on or before the Due Date;

   2)     the filing of bankruptcy proceedings involving the Borrower as a
          debtor;

   3)     the application for appointment of a receiver for the Borrower;

   4)     the making of a general assignment for the benefit of the
          Borrower's creditors;

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   5)     the insolvency of the Borrower; or

   6)     the misrepresentation by the Borrower to the Lender for the
          purpose of obtaining or extending credit.

In addition, the Borrower shall be in default if (a) there is a sale, transfer,
assignment, or any other disposition (a "Transfer") of any assets pledged as
security for the payment of this Note other than a Transfer at the fair market
value of the assets for cash with all cash proceeds of such Transfer being
immediately paid to Lender on account of this Note, (b) Borrower makes any
payment on any other loan, advance or indebtedness except to trade creditors, or
(c) if there is a default in any security agreement which secures this Note.

If any one or more of the provisions of this Note are determined to be
unenforceable, in whole or in part, for any reason, the remaining provisions
shall remain fully operative.

All payments of principal and interest on this Note shall be paid in the legal
currency of the United States. Borrower waives presentment for payment, protest,
and notice of protest and nonpayment of this Note.

No renewal or extension of this Note, delay in enforcing any right of the Lender
under this Note, or assignment by Lender of this Note shall affect the liability
of the Borrower. All rights of the Lender under this Note are cumulative and may
be exercised concurrently or consecutively at the Lender's option.

This Note shall be construed in accordance with the laws of the State of
Colorado. All judicial proceedings arising out of or relating to this Note may
be brought in any state or federal court of competent jurisdiction in the State
of California, and by execution and delivery of this Note, the Borrower accepts
for itself and in connection with its properties, generally and unconditionally,
the nonexclusive jurisdiction of the aforesaid courts and waives any defense of
forum non convenience and irrevocably agrees to be bound by any judgment
rendered thereby in connection with this Note.

Signed this       day of August, 1998, at Beverly Hills, California.
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Borrower:

      COLORADO WYOMING RESERVE COMPANY


      By:    /s/ KIM M. FUERST
             ----------------------------------------------------
             Kim M. Fuerst, President


      By: -------------------------------------------------------
             ------------------------------------------------


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                                   ASSIGNMENT

For value received, the above Note is assigned and transferred to


                                            , ("Assignee") of
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