Exhibit 10.1


    BUSINESS
      OPPORTUNITY AGREEMENT

     

    THIS
      BUSINESS OPPORTUNITY AGREEMENT (this “Agreement”)
      is
      entered into as of this 16th
      day of
      January, 2007, by and between Calibre Energy Inc., a Nevada corporation
      (“Calibre”),
      and
      Standard Drilling Inc., a Nevada corporation (“Standard”
and,
      together with Calibre, the “Parties”).

     

    R
      E C I T A L S

     

    WHEREAS,
      Calibre is primarily involved in the exploration and production business, and
      Standard is primarily involved in the energy drilling business; and

     

    WHEREAS,
      Standard from time to time receives or otherwise has the opportunity to pursue
      opportunities in the exploration and production business; and

     

    WHEREAS,
      Calibre from time to time receives or otherwise has the opportunity to pursue
      opportunities in the energy drilling business; and

     

    WHEREAS,
      the Parties have officers and directors in common; and

     

    WHEREAS,
      the Parties desire to clarify their separate interests in order, among other
      considerations, to permit their officers and directors in common to manage
      their
      respective businesses without concern that such interests overlap;
      and

     

    WHEREAS,
      Standard has entered into that certain transaction described on Exhibit A (the
      “Excepted
      Transactions”),
      pursuant to an opportunity presented to officers of Standard who have no
      relationship with Calibre; and

     

    WHEREAS,
      the Parties desire to clarify their interests in business opportunities, all
      as
      set forth below;

     

    A
      G R E E M E N T S

     

    NOW,
      THEREFORE, in consideration of the premises, covenants, conditions and
      agreements contained herein, and for other good and valuable consideration,
      the
      receipt and sufficiency of which are hereby acknowledged, the Parties hereby
      agree as follows:

     

    I.
      Scope of Business

    


    Calibre’s
      scope of business consists of the pursuit of business opportunities in the
      E&P Business. “E&P
      Business”
means
      the oil and gas exploration, exploitation, development and production business
      and includes without limitation (a) the ownership of oil and gas property
      interests (including working interests, mineral fee interests and royalty and
      overriding royalty interests), (b) the ownership and operation of real and
      personal property used or useful in connection with exploration for
      Hydrocarbons, development of Hydrocarbon reserves upon discovery thereof and
      production of Hydrocarbons from wells located on oil and gas properties and
      (c)
      debt of or equity interests in corporations, partnerships or other entities
      engaged in the exploration for Hydrocarbons, the development of Hydrocarbon
      reserves and the production and sale of Hydrocarbons from wells located on
      oil
      and gas properties in which the entity conducting the E&P Business owns an
      interest; but such term does not include the oilfield services business,
      including the oilfield drilling business. “Hydrocarbons”
means
      oil, gas or other liquid or gaseous hydrocarbons or other minerals produced
      from
      oil and gas wells.

     

    Standard’s
      scope of business consists of the pursuit of business opportunities in the
      oilfield services business, including the oilfield drilling business, together
      with the pursuit of the Excepted Transactions.

     

    II.
      Renunciation of Interests

    


    Calibre
      hereby renounces any interest or expectancy in any business opportunity in
      the
      oilfield services business, including the oilfield drilling business, and in
      the
      Excepted Transactions. In furtherance thereof, Calibre agrees not to acquire,
      invest in or operate any oilfield services business, including any oilfield
      drilling business, and to use its reasonable commercial efforts to advise
      Standard of such business opportunities presented to Calibre.

     

    Standard
      hereby renounces any interest or expectancy in the E&P Business (other than
      the Excepted Transactions). In furtherance thereof, Standard agrees not to
      acquire, invest in or operate any E&P Business, other than the Excepted
      Transactions, and to use its reasonable commercial efforts to advise Calibre
      of
      such business opportunities presented to Standard.

     

    III.
      Term

    


    This
      Agreement shall commence as of the date hereof and continue for a term (the
      “Term”)
      expiring on December 31, 2009, unless earlier terminated pursuant to this
      Section III. Either Party may terminate this Agreement upon thirty days (30)
      written notice, if there is a Change of Control (as hereafter defined) with
      respect to such Party. For purposes of this Agreement, a “Change of Control”
shall be deemed to have taken place upon the earliest occurrence of any of
      the
      following: (i) more than 50% of the outstanding voting securities of a Party
      are
      Beneficially Owned (as defined in Rule 13d-3 under the Securities Exchange
      Act
      of 1934, as amended) by any person or entity other than Calibre or Standard
      or
      their respective subsidiaries or affiliates (including any officer or director
      of Calibre or Standard or any person or entity affiliated with any such officer
      or director) (a “Non-Affiliate”),
      (ii)
      a Party is merged or consolidated with a Non-Affiliate and, as a result of
      such
      merger or consolidation, less than 50% of the outstanding voting securities
      of
      the surviving or resulting corporation or entity is Beneficially Owned in the
      aggregate by the persons or entities who were shareholders/equity owners of
      such
      Party immediately prior to such merger or consolidation; or (iii) a Party sells
      or otherwise transfers all or substantially all of its assets to a
      Non-Affiliate.

     

    IV.
      Miscellaneous

    


    No
      Relationship. No
      relationship of partnership or principal and agent shall exist or arise among
      the Parties hereto because of the execution of this agreement or the joint
      acquisition by them of properties and interests pursuant to this Agreement.
      No
      Party hereto shall have any right, power or authority to contract on behalf
      of
      any other Party hereto or to commit any party hereto to any obligation,
      liability or undertaking, except to the extent the Party to be obligated has
      expressly consented thereto (i) at a Prospect Meeting, or (ii) by instrument
      in
      writing.

     

    Limitation
      on Assignment. Without
      the prior written consent of the other Party, the rights and privileges of
      this
      Agreement may not be sold or otherwise transferred by any Party (other than
      any
      transfer to an affiliate of such Party), provided that no such assignment shall
      relieve any Party of its duties and obligations arising hereunder.

     

    Entire
      Agreement; Amendments.
      This
      Agreement and each Operating Agreement entered into by the Parties pursuant
      to
      Paragraph III above constitutes the entire understanding between the parties
      with respect to the subject matter hereof, and supersede all other agreements
      written or oral between the Parties with respect to such subject matter. This
      Agreement may not be changed, modified or amended except by a written agreement
      between the Parties. 

     

    Governing
      Law. The
      rights and obligations of the Partners with respect to this Agreement, and
      any
      arbitration proceeding pursuant hereto, shall be governed by the laws of the
      State of Texas.

     

    Arbitration.
      Any
      disputes arising out of or related to this Agreement shall be resolved through
      binding arbitration in accordance with the rules for commercial arbitration
      disputes for the American Arbitration Association for binding arbitration and
      such arbitration shall be conducted in Houston, Texas. Each of the Parties
      agrees that arbitration under this Section IX is the exclusive method for
      resolving any claim hereunder and that it will not commence an action or
      proceeding based on a claim hereunder, except to enforce the arbitrators’
decisions as provided in this Section IX, or to compel any other Party to
      participate in arbitration under this Section IX. If any claim has not been
      resolved by mutual agreement on or before the 15th
      day
      following the first notice of the claim to or from a disputing party, then
      the
      arbitration may be initiated by one party by providing to the other party a
      written notice of arbitration specifying the claim or claims to be arbitrated.
      The arbitration panel (the “Panel”)
      shall
      consist of three arbitrators who are qualified to hear the type of claim at
      issue. They may be selected by agreement of the Parties within thirty days
      of
      the notice initiating the arbitration procedure, or from the date of any order
      compelling such arbitration to proceed. The final hearing shall be conducted
      within 60 days of the selection of the entire Panel. If the Parties fail to
      agree upon the designation of any or all the Panel, then the Parties shall
      request the assistance of the AAA. The Panel shall make all of its decisions
      by
      majority vote. The decision of the Panel will be binding and non-appealable,
      except as permitted under the Federal Arbitration Act. Only actual damages
      may
      be awarded. It is expressly agreed that the Panel shall have no authority to
      award treble, exemplary or punitive damages of any type under any circumstances
      regardless of whether such damages may be available under the applicable
      law.

     

    Notice.
      All
      notices authorized or required to be given pursuant to this Agreement shall
      be
      in writing and may be delivered by hand, mailed by first class airmail, sent
      by
      telecommunication, or overnight delivery to the address set forth in this
      Agreement. The notice shall be deemed to have been given and received if
      delivered in person or by electronic message, on the day on which it was
      delivered, excluding Saturdays, Sundays and statutory holidays; or if mailed,
      on
      the day received, or if sent by telecommunication, on the first business day
      following the day it was dispatched. A Party may change its address for the
      receipt of notices at any time by giving written notice thereof to the other
      Party. 

    


    


    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
      executed by their respective authorized officers as of the date first above
      written.

     

    Calibre
      Energy Inc., a Nevada corporation

    


    


    By:   

    Name: O.
      Oliver
      Pennington, III

    Title: VP
&
      CFO

    


    Address
      for Notice:

    1667
      K
      Street, N.W.

    Suite
      1230

    Washington,
      D.C. 20006

    Facsimile
      No.: (202) 955-9490

    Attn:
      O.
      Oliver Pennington, CFO

     

    Standard
      Drilling Inc., a Nevada corporation

    


    


    By:   

    Name: Robert
      T.
      Moffett

    Title: SVP
&
      General Counsel

    


    Address
      for Notice:

    1155
      Dairy Ashford

    Suite
      402

    Houston,
      TX 77079

    Facsimile
      No.: (281) 293-7770

    Attn:
      Robert T. Moffett, SVP & General Counsel


    Exhibit
      A

    Excepted
      Transactions

    


    Burnet
      Oil Company DeCleva Prospect

     

    Daniels
      Prospect

     

    Norton
      Unit Prospect

     

    Arkansas
      Leases in Arkoma Basin