EXHIBIT 10.01





                      TERMINATION AND SETTLEMENT AGREEMENT

         This Termination and Settlement Agreement (the "Termination Agreement")
dated as of December 23, 2004 is entered into by and among Gasco Energy,  Inc. a
Nevada  corporation  ("Company"),  Marc A.  Bruner  an  individual  residing  in
Metzerlen,  Switzerland ("Bruner"),  and Mark A. Erickson an individual residing
in Highlands Ranch, Colorado ("Erickson" and together with Bruner, collectively,
"Agents" or  individually  an "Agent").  Company and Agents are each referred to
herein individually as a "Party" and, collectively, as the "Parties".

                                  INTRODUCTION

         A.  Company,   Agents  and  others  entered  into  that  certain  Trust
Termination  and  Distribution  Agreement  dated  as of  December  31,  2002 (as
amended, supplemented or otherwise modified from time to time, the "Distribution
Agreement")  which  terminated the Pannonian  Employee  Royalty Trust  Agreement
dated as of March 30, 2001 ("Trust Agreement") and provided for the distribution
to  Participants  (as defined in the Trust  Agreement)  of the Trust  Estate (as
defined in the Trust Agreement) in accordance with terms thereof;

         B.  The  Company  and  the  Agents  want to  modify  the  terms  of the
Distribution  Agreement and terminate any further rights that Agents may have to
receive any of the Trust Estate or any other properties including any overriding
royalty  interest  or  other  mineral  interest  pursuant  to  the  Distribution
Agreement and have Agents  reconvey any overriding  royalty  interests that they
may have  received  to date in  accordance  with the  terms of the  Distribution
Agreement located in the state of Utah for the consideration set forth herein.

         THEREFORE,  for and in consideration of the mutual benefits  hereunder,
the Parties hereby agree as follows:

         Section 1.        Definitions.  The following terms shall have the
                             meanings set forth below:

          "Change of Control" means any of the following events:
                  (i) any  "person"  (as such term is used in Section  13(d) and
          14(d)  of  the  Securities  Exchange  Act of  1934,  as  amended  (the
          "Exchange  Act")),  other  than a trustee or other  fiduciary  holding
          securities under an employee benefit plan of the Company,  becomes the
          "beneficial  owner" (as defined in Rule 13d-3 under the Exchange  Act)
          or any  current  owner of  shares  of  common  stock  of the  Company,
          directly  or  indirectly,  of shares of  common  stock of the  Company
          representing  50% or more of the voting  power of the  Company's  then
          outstanding common stock;
                  (ii) the  consummation  of a merger  or  consolidation  of the
          Company with any other  corporation or entity,  other than a merger or
          consolidation  that  results  in the  shares  of  common  stock of the
          Company outstanding  immediately prior thereto continuing to represent
          (either by remaining  outstanding  or by being  converted  into voting


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          securities  of the  surviving  entity)  at least  51% of the  combined
          voting  power  of the  voting  securities  of  the  Company  (or  such
          surviving  entity or parent  entity,  as the case may be)  outstanding
          immediately after such merger or consolidation;
                  (iii)  the  stockholders  of the  Company  approve  a plan  of
          complete liquidation of the Company; or
                  (iv)  the  sale  or  disposition  by  the  Company  of  all or
          substantially all of the assets of the Company.
         "Triggering Event" means the occurrence of any of the following events:

                  (i) a Change of Control shall occur;

                  (ii) the sale or conveyance  by the Company,  other than to an
         affiliate,  of all or substantially all of its interest in any property
         listed on Schedule 1 (provided  however,  (A) neither the expiration or
         termination  of any lease nor the  farmout of any such  lease  shall be
         construed  as a sale or  conveyance  of such lease and (B) a  mortgage,
         security interest or collateral assignment for the purpose of providing
         security  for the  benefit of a  creditor  will not be deemed a sale or
         conveyance of any lease);

                  (iii) with respect to Erickson only,  upon the  termination of
         the Gasco Energy,  Inc.  Employment  Agreement between Mark A. Erickson
         and Gasco Energy, Inc. dated as of February 14, 2003; or

                  (iv) with respect to Bruner only,  upon the termination of the
         Gasco  Energy,  Inc.  Strategic  Consulting  Agreement  between Marc A.
         Bruner and Gasco Energy, Inc. dated as of February 14, 2003.

         Section 2. Termination. The Parties hereby agree that Agents shall have
no further rights to any assignment,  distribution or conveyance of any property
or  other  interests  pursuant  to the  Distribution  Agreement  including,  any
distributions  that may be required  pursuant  to Section 4 of the  Distribution
Agreement,  any such rights to any  assignment,  distribution  or conveyance are
herby  terminated and shall no longer have any force or effect and Company shall
have no obligation to make any such assignment, distribution or conveyance under
the Distribution Agreement to the Agents or their successors and assigns.

         Section 3. Reconveyance.  Agents hereby GRANT,  BARGAIN,  SELL, ASSIGN,
AND TRANSFER all of their rights, titles and interests in any working,  royalty,
fee,  overriding  royalty,  mineral or other  interests or other  properties and
rights (including any legal,  beneficial or record title interest) that they may
have received or been entitled to receive pursuant to the Distribution Agreement
with respect to any such  interests,  properties or rights located in the states
of Utah or  Wyoming  ("Distributed  Property")  to  Company.  The Agents and the
Company agree to execute and delivery such additional  documents and instruments
and do  such  other  acts  as may  reasonably  be  required  to  effectuate  the
reconveyance and assignment set forth in this Section 2.

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         Section 4. Special Warranty.  Each Agent hereby represents and warrants
that such  Agent has not sold,  assigned,  conveyed,  transferred  or  otherwise
distributed or encumbered in any way any of the  Distributed  Property and shall
WARRANT  AND  FOREVER  DEFEND  all and  singular  the  title to the  Distributed
Property  unto the Company,  its  successors  and assigns  against  every person
whomsoever  lawfully  claiming  or to claim  the same or any  part  thereof  by,
through, or under such Agent but not otherwise.

         Section 5. Override  Conveyance.  Company  hereby  agrees that,  upon a
Triggering Event, Company will grant an overriding royalty interest ("Override")
pursuant to a Conveyance  of  Overriding  Royalty  Interest in the form attached
hereto as Exhibit A out of the properties and out of only such properties as set
forth on the attached Schedule 1, with an overriding royalty percentage interest
as indicated  on Schedule 1 with respect to such  property in which the override
is  being  granted  to  each  of  the  Agents  (subject  to  any  recoupment  or
reimbursement  obligations  pursuant to any non-consent or  non-participation by
Company in any operations on the properties set forth on Schedule 1) and with an
effective  date as of the first day of the month in which the  Triggering  Event
occurred.  Notwithstanding  the preceding,  (i) in the event that the Triggering
Event that is giving rise to the grant of the Override is the event described in
sub-section  (ii) of the definition of Triggering  Event, in such instance,  the
Override  will be granted  only with  respect to the  property  that is actually
being  sold or  conveyed  and  not out of all of the  properties  set  forth  in
Schedule 1 and (ii) in the event that the  Triggering  Event that is giving rise
to the grant of the Override is the event described in sub-section (iii) or (iv)
of the definition of Triggering  Event,  in such instance,  the Override will be
granted only to the Agent for which the Triggering Event has actually occurred.

         Section 6. Entirety.  This  Termination  Agreement  contains the entire
understanding between the Parties and the terms and conditions of this Agreement
supersede and replace any other agreements or  understandings  among the Parties
including,  the  Distribution  Agreement,  with  respect  to such  transactions,
whether oral or written.

         Section  7.  Notices.   All  notices,   requests,   demands  and  other
communications  made pursuant to this Termination  Agreement shall be in writing
and mailed or delivered to the  applicable  party at its address  indicated as a
part of such party's  signature block or as to each Party, at such other address
as shall be  designated  by such  party in a written  notice to the other  party
complying  as to delivery  with the terms of this  Section 8. All such  notices,
requests, demands and other communications shall be delivered either through the
United States Postal System,  by a recognized  national  courier,  or personally
delivered.

         Section 8. Further Assurances. Each Agent and the Company agrees to and
shall  execute and deliver or shall cause to be executed  and  delivered  to the
requesting  party  such  other  documents  and  instruments  and take such other
actions  as such  requesting  party  may from  time to time  deem  necessary  or
appropriate to carry out the terms of this Agreement.

         Section 9. Severability.  Any provision of this Termination  Agreement,
which is prohibited or  unenforceable  in any  jurisdiction,  shall,  as to such
jurisdiction,   be   ineffective   to  the   extent  of  such   prohibition   or
unenforceability without invalidating the remaining portion of such provision or
the other provisions of this Agreement

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         Section 10. Governing Law. This Termination Agreement shall be governed
by and construed in accordance with the laws of the State of Colorado.

         Section 11. Counterparts. This Termination Agreement may be executed in
one or more  counterparts,  each of  which  shall be  deemed  an  original,  but
together  all  such  counterparts  shall  be  considered  but one  and the  same
instrument.

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         IN  WITNESS  WHEREOF,   the  Parties  have  executed  this  Termination
Agreement as of the date first written above.


                                        COMPANY:

                                        GASCO ENERGY, INC.

                                        By:      /s/ W. King Grant
                                        Name:    W. King Grant
                                        Title:   Executive Vice President -
                                                 Chief Financial Officer

                                        Address for Notice:





                                        AGENTS:

                                        /s/ Marc A. Bruner
                                        Marc A. Bruner

                                        Address for Notice:




                                        /s/ Mark A. Erickson
                                        Mark A. Erickson

                                        Address for Notice:
                                        1135 E. Kistler Court
                                        Highlands Ranch, CO 80126





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