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                     SETTLEMENT AGREEMENT AND MUTUAL RELEASE


1.       Parties.     THIS AGREEMENT and MUTUAL RELEASE ("Release") is dated and
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entered into as of this 31st day of January, 2007, by and between JMT Resources,
Ltd., ("JMT") a Texas corporation located at 5416 Birchman Avenue, Fort Worth,
TX 76107, and Quantum Energy, Inc., Nitro Petroleum Inc., 658111 B.C. Ltd, and
RPMJ Corporate Communications Ltd (hereinafter "Quantum")

2.       Recitals.     The alleged facts and circumstances giving rise to this
Release are as set forth herein below.
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  2.1    JMT owns approximately 4,010 gross acres in mineral interest leaseholds
         located in Navarro County, Texas (the "Prospect Leases") which are part
         of the geologic trend identified as the Mildred pool; and

  2.2    JMT has offered  QUANTUM the right to participate  in the cost of
         developing the Prospect  Leases to be funded by QUANTUM, subject to the
         terms of this Agreement; and

  2.3    QUANTUM  agrees to finance  JMT's  development  and operation of the
         Prospect  Leases in  accordance with the funding requirements described
         in the JV Agreement; and


3.       Consideration.    Consideration  for this Release is the mutual promise
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herein and each act done by the parties hereto pursuant hereto,  the receipt and
sufficiency of which is acknowledged by the parties hereto, and the following:

  1.          QUANTUM shall cease and desist in using, displaying, or having any
              interest in the Corsicana  Project under the JV Agreement,  Letter
              of Intent  and any other  agreement  that may  exist  between  the
              parties and their agents or  assignees  pertaining  to  Corsicana,
              including  but  limited  to,  the 3 well  bores,  McKinney  #1 and
              McKinney #2 and Blackburn #1 from the Pecan Gap; and

  2.          JMT Resources Ltd. will pay the following:

                1.       Quantum $308,200.00 USD;
                2.       Nitro Petroleum, Inc. $145,502.00 USD;
                3.       658111 B.C. Ltd. $23,149.00 USD; and
                4.       RPMJ Corporate Communications Ltd. $23,149.00 USD.

  3.          QUANTUM  hereto  acknowledges  that it will not be entitled to any
              additional  consideration  for the execution of this Release other
              than as  expressly  set  forth and  provided  for  herein.  By its
              signature  below,  QUANTUM  hereto  acknowledges  the  receipt and
              sufficiency of the consideration evidenced by this Release.

  4.          JMT will pay the above fees on or before March 1, 2007.

  5.          Quantum will execute any and all assignments necessary to complete
              transfer of the leaseholds  back to JMT immediately upon the
              execution of this Agreement.

4.       No Pending Claims.         QUANTUM  warrants and represents that there
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are not claims against any party hereto or any party in any way related hereto,
which is either pending, or otherwise aware. QUANTUM acknowledges that JMT is
relying upon this representation and this representation is a material
inducement to the execution of this Release by JMT.

Neither  JMT nor  QUANTUM et al shall  commence  or  continue,  nor does JMT nor
QUANTUM et al know of, any claims or  proceedings  against  anyone in respect of
anything hereby  released which may result in a claim or proceeding  against JMT
or  QUANTUM  et al.  IF ANY SUCH  CLAIM or  proceeding  results  in any claim or
proceeding  against  JMT or QUANTUM  et al,  then JMT shall  indemnify  and save

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QUANTUM et al harmless from all resulting  liabilities,  obligations  and costs.
Without limiting the generality of the foregoing, JMT shall indemnify QUANTUM et
al from any and all  environmental  liability,  which now or hereafter  exist by
reason of any cause, events or omissions existing prior to the execution of this
Mutual Release.

5.  Settlement  of  agreement.  The  agreements  being made herein are merely to
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settle  a  offer  to  purchase  and a offer  to sell  the  entire  interests  in
properties  defined as Corsicana  and are not to be construed as an admission of
any fault or liability of any party hereto,  such being hereby  specifically and
expressly denied by each party hereto.

6.  Authorization.  The making and  performance  of this  Release  has been duly
authorized and is approved by each party hereto.  This Release  constitutes  the
legal,  valid and binding  obligation of each party hereto and is enforceable in
accordance with its terms.  In addition,  the undersigned are duly authorized by
the  respective  parties  to  execute  this  Release  in  their   representative
capacities by all necessary proceeding.

7.       Representation and Ownership and Indemnification.    Each party  hereto
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and/or their subsidiaries  represent and convent that they are the owners of any
and all claims at issue  herein or in any way relating to or involving  the
subject matter set forth herein.

8.       Review and Understanding.  Each party hereto has reviewed the Release
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and they  understand  fully the terms of this Release and its consequences and
have had this Release reviewed by competent legal counsel of their choice.

9. Binding  Effect.  This Release shall be binding upon and inure to the benefit
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to the parties hereto and their respective successors, assigns, heirs, and legal
representatives,  but shall not be  binding  on any  party  until  signed by all
parties.  It is  expressly  understood  and  agreed  that the terms  hereof  are
contractual in nature,  including  those set forth in the provisions  designated
"Recitals," and are not mere recitals,  the agreements  herein contained and the
consideration  transferred  hereby  are  to  by  peace,  and  the  consideration
transferred  and  conveyed  hereby  shall not be  construed  as an  admission of
liability by any of the parties to this Release.

10.      Modification.     No modification or amendment of this Release shall be
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effective unless such  modification or amendment is in writing and signed by all
parties hereto.

11.  Governing Law. The  interpretation,  construction,  and performance of this
Release  shall by  governed  by the laws of the State of Texas  and  California,
without  giving  effect to  conflict  of laws  principles,  and this  Release is
performable in Tarrant County, Texas and San Diego County, California.

12.      Severability.     If any portion of this Release shall be held to be
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invalid or  inoperative,  then, so far as is reasonable  and possible,  the
remainder of this Release  shall be considered  valid and  operative,  and not
effect shall be given to the intent manifested by the portion held invalid or
inoperative.

13.      Execution of Necessary Documents.  Each party  hereto  further convents
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and agrees to execute  any and all documents necessary to effectuate the
provisions of this Release and to cooperate  fully with each other in carry out
the provisions of this Release.

14.      Survival.        Each and every provision of this Release shall survive
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the execution hereof.

15.     Entire Agreement. This Agreement for all purposes constitutes the entire
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agreement between the parties hereto and supersedes all prior and
contemporaneous  agreements,  understandings,  negotiations and discussions,
whether oral or written.
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16. Attorneys' Fees. In the event of any litigation  concerning any controversy,
claim or dispute  between each party  hereto  arising out of or relating to this
Release or the breach hereof, or the interpretation hereof, the prevailing party
shall  be  entitled  to  recover  form the  losing  party  reasonable  expenses,
attorneys'  fees, and cost incurred  therein or in the enforcement or collection
of any judgment or award rendered herein.


IN WITNESS WHEREOF,  the parties have duly executed this Agreement as of the day
and year first above written.

JMT RESOURCES, LTD.                          RPMJ Corporate Communications Ltd.

By: /s/ Luke Zouvas                          By: /s/ Patricia Shull
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Title: Attorney for JMT Resources LTD.       Title: President  and Secretary
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Date:                                        Date:
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QUANTUM ENERGY, INC.


By: /s/ Ted Kozub

Title: President
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Date:
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NITRO PETROLEUM, INC.


By: /s/ Ted Kozub

Title: President
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Date:
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658111 B.C. Ltd


By:/s/ Jason Shull

Title: President  and Secretary
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Date:
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