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                                                                    EXHIBIT 10.2


                        SETTLEMENT AND RELEASE AGREEMENT


V. Richard Eales ("Employee") and Union Pacific Resources Group Inc. for itself
and its past and present related companies (collectively the "Company), have
negotiated in good faith the terms of this Settlement and Release Agreement
(this "Agreement") offered by the Company on August 27, 1999, and have reached
the following mutual agreement.

                                FIRST: SETTLEMENT

Employee shall cease to be an employee of the Company as of close of business
September 1, 1999, the "Separation Date." In consideration for the mutual
covenants and representations herein, Employee agrees to the terms of this
Agreement as set forth below:

1.1      For the period from August 27, 1999, through close of business
         September 1, 1999, Employee will be permitted to continue in the employ
         of the Company at his current title and base salary provided he does
         not give the Company just cause to terminate his employment. Further,
         during this period of employment, Employee will not be permitted to
         obligate or bind the Company, through agreement or otherwise, without
         the prior approval of the Chairman, Chief Executive Officer, and
         President, George Lindahl III. In the event of a breach of this
         provision, all monies and enhanced benefits provided by the Company
         shall be returned by the Employee to the Company.

1.2      The Company will, pursuant to the terms of the Supplemental Pension
         Plan for Exempt Salaried Employees of Union Pacific Resources Group
         Inc. and Affiliates, provide Employee with a retirement benefit equal
         in amount to that which he would have received if he had attained age
         65 with 10 years of service on September 1, 1999.

1.3      The Company will pay Employee a lump sum of $236,000.00 with applicable
         tax deductions withheld, on the first payday following the expiration
         of the Revocation Period, and the Company will agree to pay the entire
         premium for COBRA coverage for up to 18 months, beginning October 1999.

1.4      The Company will pay Employee on the first payday following the
         expiration of the Revocation Period for all earned but unused 1999
         vacation and accrued 2000 vacation in a lump sum, with applicable tax
         deductions withheld.

1.5      The Company will make the following disposition on outstanding stock
         options and retention stock:

         (i)      The vesting requirement associated with the grant of
                  non-qualified stock options on October 1, 1996, will be
                  waived.

         (ii)     The vesting restriction on retention shares awarded on October
                  1, 1996, shall lapse.

         (iii)    The vesting requirement associated with the grant of incentive
                  stock options on October 1, 1996, will be waived.

         (iv)     The vesting requirement associated with the grant of
                  non-qualified stock options on January 21, 1999, will be
                  waived as to 60.5% of the options and the remaining options
                  will be forfeited.



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1.6      Employee will have the option to elect to continue the following fringe
         benefits:

         (i)      1999 tax return preparation and financial consulting fees will
                  be covered by the Company as defined in the Executive Benefits
                  Manual.

         (ii)     The Petroleum Club of Fort Worth membership will be
                  transferred to Employee's name and he will assume the monthly
                  dues.

         (iii)    The home security alarm system will be transferred to
                  Employee's name at no cost and he will assume the monthly fees
                  for continued operation.

         (iv)     Mobile hand-held or car phone equipment will be transferred to
                  Employee's name at no cost and he will assume the monthly fees
                  for continued operation.

1.7      The Company agrees that the Employee shall not otherwise be eligible to
         participate in any of the Company's compensation and benefit programs
         after the Separation Date. The foregoing shall not affect Employee's
         entitlement to benefits under the Company's 401 (k) and pension plans
         that are vested.

1.8      Employee agrees that the benefits provided herein are more than the
         Company is required to pay under its normal policies and procedures and
         that Employee is not otherwise entitled to such benefits by law or
         contract.

1.9      The right of Employee (or any beneficiary of Employee) in any benefit
         or to any payment under this Agreement shall not be subject to
         attachment or other legal process for debts: and any such benefit or
         payment shall not be subject to anticipation, alienation, sale,
         transfer, assignment or encumbrance.

                            SECOND: COMPLETE RELEASE

2.1      In exchange for the Settlement described in the FIRST Paragraph,
         Employee hereby releases, covenants not to sue and forever discharges
         the Company, its past and present affiliate and subsidiary companies,
         its and their past and present directors, officers, employees and
         agents and benefit programs (and the trustees, administrators,
         fiduciaries and insurers of such programs) and any other persons acting
         by, through, under or in concert with any of the persons or entities
         listed above, from any and all claims or rights Employee may have (or
         which may arise before this Agreement becomes effective), including,
         but not limited to, claims based on Employee's employment or the
         termination of that employment. This includes, but is not limited to, a
         release of claims or rights Employee may have under the federal Age
         Discrimination in Employment Act of 1967, as amended, which prohibits
         age discrimination in employment; Title VII of the Civil Rights Act of
         1964, as amended, and the Civil Rights Act of 1991, which prohibit
         discrimination in employment based on race, color, national origin,
         religion or sex; The Americans With Disabilities Act of 1990, which
         prohibits discrimination against the disabled; or any and all other
         federal, state or local laws or regulations or ordinances prohibiting
         employment discrimination. Employee also releases any claims for
         wrongful discharge, for breach of an express or implied employment
         contract or personal injuries arising therefrom, if any. This Agreement
         covers both claims that Employee knows about and those Employee may not
         know about, but does not release any claims which arise after this
         Agreement becomes effective. Employee represents that he has not filed
         or caused to be filed a lawsuit asserting any claims that are released
         in this Paragraph. Further, Employee agrees not to pursue any charges
         or claims or commence any actions of any kind with any local, state or
         federal agency or state or federal court pertaining to claims that are
         released in this Paragraph. Excluded from this Agreement are claims
         which cannot be waived by law, including, but not limited to, the right




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         to file a charge with or participate in an investigation with the EEOC.
         Employee is waiving, however, his right to any monetary recovery or
         relief should the EEOC or any other agency pursue any claims on his
         behalf.

                        THIRD: NON-ADMISSION OF LIABILITY

3.1      The Company enters into this Agreement to avoid the cost of defending
         against any possible lawsuit. By entering into this Agreement, the
         Company does not admit that it has done anything wrong.

3.2      The Employee enters into this Agreement as a resolution of all issues
         related to his separation from the Company. By entering into this
         Agreement, the Employee does not admit that he has done anything wrong.

             FOURTH: CONSEQUENCES OF EMPLOYEE VIOLATION OF PROMISES

4.1      If Employee breaks Employee's promise in the Second Paragraph of this
         Agreement and files a claim, charge or lawsuit based on legal claims
         that Employee has released, Employee will pay for all costs incurred by
         the Company, any related companies or the directors or employees of any
         of them, including reasonable attorney's fees, in defending against
         Employee's claim.

           FIFTH: PERIOD OF REVIEW AND CONSIDERATION OF AGREEMENT, SIGNATURE

5.1      Employee acknowledges that Employee has been given a period of 21 days
         to review and consider this Agreement before signing it and that this
         period will expire at the close of business on September 17, 1999.
         Employee further understands that Employee may use as much of the
         21-day period as Employee wishes prior to signing. If Employee desires
         to enter into this Agreement, Employee should sign it and deliver it to
         Anne M. Franklin, Vice President - People, Union Pacific Resources
         Group Inc., 777 Main Street, Fort Worth, Texas 76102 or fax to (817)
         321-7522 before the close of business on September 17, 1999. This
         Agreement will then be effective and enforceable unless Employee
         revokes it by following the procedure in the SEVENTH Paragraph. If
         Employee does not sign this Agreement and deliver it to Anne M.
         Franklin before the close of business on September 17, 1999, this
         Agreement will not be effective or enforceable and Employee will not
         receive the benefits described in the FIRST Paragraph.

                        SIXTH: CONSULTATION WITH ATTORNEY

6.1      The Company has advised Employee to consult with an Attorney before
         signing this Agreement. Employee understands that whether or not to do
         so is Employee's decision. Any costs incurred by Employee as a result
         of consulting with an attorney must be paid by Employee.

                  SEVENTH: EMPLOYEE'S RIGHT TO REVOKE AGREEMENT

7.1      Employee may revoke this Agreement within 7 days of Employee's signing
         and delivering it to Anne M. Franklin. Revocation can be made by
         delivering a written notice of revocation to Anne M. Franklin, by
         mailing it to the address or faxing it to the number provided in the
         FIFTH Paragraph. For this revocation to be effective, written notice
         must be received by Anne M. Franklin no later than the close of
         business on the seventh day after Employee signs and delivers this
         Agreement. If Employee revokes this Agreement it will not be effective
         or enforceable and Employee will not receive the benefits described in
         the FIRST Paragraph and this Agreement will have no force or effect.


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                             EIGHTH: CONFIDENTIALITY

8.1      As a material inducement to the Company to enter into this Agreement,
         Employee agrees not to retaliate against any present or former employee
         of the Company nor will he contact any present or former employee to
         discuss his separation from the Company, except for Anne M. Franklin.
         Further, Employee and the Company agree not to disclose in any manner
         the existence and terms of this Agreement or the content or prior
         discussions leading thereto, except in the instance of the Employee, to
         his spouse, to his attorney or to his tax advisor or as may be required
         in conjunction with the submission of a financial statement or credit
         application or as may be required by law and in the instance of the
         Company, to its employees in a "need to know" capacity and/or in a
         capacity to implement the terms of this Agreement and only to the
         extent necessary and to its attorney(s) or as may be required by law.
         Employee's spouse, attorney and tax advisor shall be bound by this
         provision as if a party to this Agreement and breach by any one of them
         shall constitute a breach of this Agreement by Employee. In the event
         of a breach of this provision, all monies and enhanced benefits
         provided by the Company shall be returned to the Company.

8.2      Employee acknowledges that as an officer of the Company, Employee has
         had access to proprietary and confidential information that directly or
         indirectly relates to the business of the Company and its past and
         present affiliates and subsidiary companies. For purposes of this
         Agreement, "Confidential Information" means all information about the
         Company and its past and present affiliates and subsidiary companies
         obtained or developed by Employee while an officer of the Company
         including, but not limited to, information regarding the Company's
         officers and other key personnel, financial information or plans and
         legal and other matters, and which the Company has requested be held in
         confidence or could reasonably be expected to desire to be held in
         confidence, or the disclosure of which would likely be disparaging or
         disadvantageous to the Company or any of its employees, officers and
         directors but shall not include information already in the public
         domain. Employee agrees that Employee will not, without prior written
         consent of the Company or except pursuant to lawful process, (i)
         disclose to any person any Confidential Information, or (ii) take with
         the Employee any property of the Company or any document or papers
         containing or relating to any Confidential Information, except for
         documents that the Company has agreed to in writing that the Employee
         may take. Further, Employee agrees not to take any actions, either
         directly or indirectly, that interfere with or adversely affect the
         business operations of the Company or have a financial or disparaging
         impact on the Company. In the event of a breach of this provision, all
         monies and enhanced benefits provided by the Company shall be returned
         to the Company.

                            NINTH: EQUITABLE REMEDIES

9.1      The Company and Employee agree that money damages may not be adequate
         to compensate Company for Employee's breach of the EIGHTH Paragraph,
         8.2, and that the Company will be entitled to a decree for specific
         performance, immediate injunctive relief to prohibit any further
         conduct by Employee in violation of the terms of this Agreement, or
         other appropriate remedy to enforce Employee's Performance of this
         Paragraph.

                          TENTH: TERMINATION AGREEMENT

10.1     Employee acknowledges that if this Agreement becomes effective his
         employment with Union Pacific Resources Company will end irrevocably
         and forever and will not be resumed at any time in the future.




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                             ELEVENTH: GOVERNING LAW

11.1     Notwithstanding any other provision of this Agreement, any dispute
         concerning any question of fact or law arising under this Agreement
         which is not disposed of by agreement between Employee and the Company
         shall be decided by a court of competent jurisdiction of the State of
         Texas in accordance with the laws of Texas without regard to rules or
         principles governing conflicts of law.

                            TWELFTH: WAIVER OF BREACH

12.1     The waiver by the Company of a breach of any provision of this
         Agreement by Employee shall not operate or be construed as a waiver of
         any subsequent breach by Employee.

                            THIRTEENTH: SEVERABILITY

13.1     Every provision of this Agreement is intended to be severable. If any
         term or provision hereof is illegal or invalid for any reason
         whatsoever, such illegality or invalidity shall not affect the validity
         of the remainder of this Agreement.

                          FOURTEENTH: ENTIRE AGREEMENT

14.1     This Agreement constitutes the entire agreement between Employee and
         the Company. The Company has made no promises to Employee other than
         those in this Agreement.


PLEASE READ THIS AGREEMENT CAREFULLY. IT CONTAINS A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS.

EMPLOYEE ACKNOWLEDGES THAT EMPLOYEE HAS READ THIS AGREEMENT, UNDERSTANDS IT AND
IS VOLUNTARILY ENTERING INTO IT.



UNION PACIFIC RESOURCES GROUP INC.


By   /s/ Anne M. Franklin
  ---------------------------------------
         Anne M. Franklin
         Vice President - People


Date   August 26, 1999
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ACCEPTED AND AGREED TO THIS ___ DAY OF ___________________, 1999.

/s/ V. Richard Eales
------------------------------------
Employee, V. Richard Eales


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