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ROYALTY INTEREST REPURCHASE AGREEMENT

THIS AGREEMENT is made as of the 6th day of July, 2003

AMONG:

**DYNAMIC OIL & GAS, INC.**
  a British Columbia company with its principal place of business located at 230
   10991 Shellbridge Way, Richmond, British Columbia V6X 3C6 (the Purchaser)

AND:

**DONZOIL LTD.** a British
  Columbia company with its principal place of business located at 6377 Crescent
  Court, Delta, British Columbia V4K 4Y5 (the Seller)

AND:



**DONALD UMBACH**, a businessman
  having a residence located at 6377 Crescent Court, Delta, British Columbia V4K
  4Y5 (the Shareholder)

WHEREAS:

|A. | The Seller was previously granted certain
        royalty interests (the Royalty Interests) in respect
        of petroleum substances within, upon or under certain lands in which the
        Purchaser had an interest under the terms of an Overriding Royalty Agreement
        dated July 13, 1990 (the Royalty Agreement);
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                      
|B. | The Purchaser has agreed to purchase
        and the Seller has agreed to sell the Royalty Interests for the price
        and on the terms stated in this Agreement.                                                                                                                                                                

NOW THEREFORE in consideration of the covenants, promises,
  representations and warranties set forth herein, and for other good and valuable
  consideration, intending to be legally bound hereby the parties agree as follows:

|1. | Definitions.:
|-- | -------------
|   |              
|   | (a)          
|   |              
|   | (i)          
|   |              
|   | (ii)         
|   |              
|   | (b)          

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2

|2. | Purchase and Sale
        of Royalty Interests.Upon the terms and subject to the conditions
        of this Agreement, and in consideration of the Purchase Price, the Seller
        shall sell, assign, transfer and deliver the Royalty Interests free of
        Encumbrances to the Purchaser and the Purchaser shall purchase from the
        Seller and take delivery of the Royalty Interests with effect from the
        Closing Date.                                                                                                    
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|3. | Purchase Price.The aggregate purchase price for the Royalty Interests shall be Cdn.$2,172,000
        (the Purchase Price), payable by the Purchaser to the
        Seller, subject to section 4, through:                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|4. | Withholding Taxes.The Purchaser shall be entitled to withhold from the Purchase Price
        those amounts required to be withheld as taxes, governmental charges or
        assessments, including, but not limited to, all amounts required to be
        withheld pursuant to the Income Tax Act(Canada), the Canada
        Pension Plan, the Employment Insurance Actand any other applicable
        legislation.                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|5. | Closing.The
        closing of the purchase and sale of the Royalty Interests and the other
        transactions contemplated herein (the Closing) shall
        take place at 12:01 a.m. (Vancouver time) on July 7, 2003 at the offices
        of the Purchaser. At the Closing, the Seller shall deliver to the Purchaser
        a certificate confirming the representations and warranties contained
        in section 6 are true and correct on and as if made at Closing. At the
        Closing, the Purchaser shall deliver the Shares.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|6. | Representations and
        Warranties of the Seller and the Shareholder.As an inducement
        to the Purchaser to enter into this Agreement and consummate the transactions
        contemplated hereby, the Seller and the Shareholder jointly and severally
        represent and warrant to the Purchaser that:                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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3

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | judgment against the Seller leading
        to the impairment or loss of the Sellers title to the Royalty Interests;                                                                                                                                                                                                                                                                                                                                      
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Seller is not violating, contravening,
        breaching, or creating a default under any law, statute, regulation, order,
        judgment, or decree applicable to the Seller by becoming party to this
        Agreement or performing the provisions hereof;                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Shareholder is not in a relationship
        in respect of which a triggering event (as defined in Part
        5 of the Family Relations Act(British Columbia), or any applicable
        similar legislation in any other jurisdictions) has occurred;                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (j)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Shareholder has obtained independent
        legal advice for himself and for his spouse in connection with the purchase
        and sale of the Royalty Interests; and                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (k)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Seller is not a non-resident of
        Canada within the meaning of section 116 of the Income Tax Act(Canada).                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7. | Representations and
        Warranties of the Purchaser.As an inducement to the Seller to
        enter into this Agreement and consummate the transactions contemplated
        hereby, the Purchaser represents and warrants to the Seller that:                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Purchaser is a corporation duly
        incorporated under the laws of the jurisdiction of British Columbia and
        is duly organized, validly subsisting and in good standing under such
        laws;                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | as at the Closing Date, this Agreement
        has been duly executed and delivered by and constitutes the legal, valid
        and binding obligations of the Purchaser, enforceable against it in accordance
        with its terms. All actions contemplated by the Purchaser have been duly
        and validly authorized by all necessary proceedings by the Purchaser;
        and                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | as a the Closing Date, the Shares will
        be duly and validly authorized, allotted and issued as fully paid and
        non-assessable.                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|8. | Conditions of Closing.The Purchaser shall not be obligated to complete the purchase and
        sale of the Royalty Interests pursuant to this Agreement unless at or
        before the Closing Date, unless each of the following conditions, which
        conditions are for the sole benefit of the Purchaser and may be waived
        in whole or in part by the Purchaser, has been satisfied, and the Seller
        agrees with the Purchaser to take all such actions, steps and proceedings
        as necessary to ensure the following conditions are fulfilled at or before
        the Closing Date:
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the representations and warranties of
        the Seller and the Shareholder contained in section 6 shall be true and
        correct at Closing;                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | each of the Seller and the Shareholder
        shall have performed and complied with all of the terms and conditions
        in this Agreement on its part to be performed or complied with at or before
        Closing and shall have executed and delivered or caused to have been executed
        and delivered to the Purchaser at the Closing all the documents contemplated
        in this Agreement, tendered in accordance with this Agreement;
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | there shall be no litigation or proceedings:                                                                                                                                                                                                                                                                                                                                                                                                               

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4

|    | (i)                                                                                                                                                                                                                                                                                                                                                              | pending against the Seller
        or the Shareholder or involving the assets or properties of the Seller
        or the Shareholder, for the purpose of enjoining, preventing or restraining
        the completion of the transactions contemplated hereby or otherwise claiming
        that such completion is improper; or
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (ii)                                                                                                                                                                                                                                                                                                                                                             | pending against the Seller
        or Shareholder which:                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (A)                                                                                                                                                                                                                                                                                                                                                              | in the result, could adversely affect
        the right of the Purchaser to acquire or retain the Royalty Interests;
        or                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (B)                                                                                                                                                                                                                                                                                                                                                              | in the judgment of the Purchaser, would
        make the completion of the transactions contemplated by this Agreement
        inadvisable; and                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (d)                                                                                                                                                                                                                                                                                                                                                              | each of the Seller and the
        Shareholder shall have delivered to the Purchaser an executed release
        in the form attached as Schedule A which:                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (i)                                                                                                                                                                                                                                                                                                                                                              | fully discharges and releases
        the Purchaser from any obligations under the Royalty Agreement; and                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (ii)                                                                                                                                                                                                                                                                                                                                                             | fully discharges and releases
        any Lien arising under the Royalty Agreement;                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (e)                                                                                                                                                                                                                                                                                                                                                              | the Seller shall have delivered
        to the Purchaser a certificate of the President of the Seller attaching:                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (i)                                                                                                                                                                                                                                                                                                                                                              | a copy of resolutions of
        the Board of the Seller approving the purchase and sale under this Agreement;
        and                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (ii)                                                                                                                                                                                                                                                                                                                                                             | an incumbency certificate
        setting out the signatures and positions of the persons who are authorized
        to sign documents on behalf of the Seller in accordance with the constating
        documents of the Seller;                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (f)                                                                                                                                                                                                                                                                                                                                                              | the Seller shall have delivered
        to the Purchaser an executed general conveyance agreement in the form
        attached as Schedule B; and                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                
|    | (g)                                                                                                                                                                                                                                                                                                                                                              | the Seller shall have delivered
        to the Purchaser an executed copy of this Agreement.                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                 
|9.  | Time.Time
        shall be of the essence of this Agreement.                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                 
|10. | Further Actions.Each of the Seller, the Purchaser and the Shareholder shall promptly
        do, execute, deliver or cause to be done, executed and delivered all further
        acts, documents and things in connection with this Agreement that the
        other party may reasonably require, for the purposes of giving effect
        to this Agreement.
|    |                                                                                                                                                                                                                                                                                                                                                                 
|11. | Entire Agreement.This Agreement constitutes the entire agreement between the parties
        with respect to the subject matter hereof and supercedes all prior negotiations,
        proposals and agreements, whether oral or written, with respect to the
        subject matter of this Agreement.                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                 
|12. | Amendment.No
        term or provision hereof may be amended except by an instrument in writing
        signed by all of the parties to this Agreement.                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                 
|13. | Waiver.Failure
        by any party hereto to insist in any instance upon the strict performance
        of any one of the covenants contained herein will not be construed as
        a waiver or relinquishment of such                                                                                                                                       

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5

|    | covenant. No waiver by any party hereto
        of any such covenant will be deemed to have been made unless expressed
        in writing and signed by the waiving party.                                                                                                                                                        
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                   
|14. | Severability.The unlawfulness
        or invalidity of any provision in this Agreement or of any covenant herein
        contained on the part of any party will not affect the validity or enforceability
        of any other provision or covenant hereof or herein contained and may
        be individually severed herefrom.
|    |                                                                                                                                                                                                                                                                                                                                   
|15. | Successors and Assigns.This
        Agreement will enure to the benefit of and be binding upon the parties
        hereto, their permitted assigns and their personal representatives, administrators,
        heirs and successors.                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                   
|16. | Governing Law.This Agreement
        shall be governed by and construed in accordance with the laws of the
        Province of British Columbia and the laws of Canada applicable in that
        Province and shall be treated in all respect as a British Columbia contract.                                                    
|    |                                                                                                                                                                                                                                                                                                                                   
|17. | Counterparts.This Agreement
        may be executed in any number of counterparts, each of which shall be
        deemed to be an original and all of which taken together shall be deemed
        to constitute one and the same instrument.                                                                                     

IN WITNESS WHEREOF the parties have executed this Agreement.

|DYNAMIC OIL & GAS, INC.                |                        |   |               |       
|-------------------------------------- | ---------------------- | - | ------------- | ------
|Per:                                   |                        |   |               |       
|                                       | (Authorized Signatory) |   |               |       
|                                       |                        |   |               |       
|                                       |                        |   |               |       
|DONZOIL LTD.                           |                        |   |               |       
|Per:                                   |                        |   |               |       
|                                       | (Authorized Signatory) |   |               |       
|                                       |                        |   |               |       
|                                       |                        |   |               |       
|Signed, Sealed and Delivered by DONALD |                        | ) |               |       
|UMBACH:                                |                        | ) |               |       
|                                       |                        |   | )             |       
|In the presence of:                    |                        | ) |               |       
|                                       |                        |   | )             |       
|                                       |                        |   | )             |       
|Witness (Signature)                    |                        | ) | Donald Umbach | (seal)
|                                       |                        |   | )             |       
|                                       |                        |   | )             |       
|Name (Please print)                    |                        | ) |               |       

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SCHEDULE A - RELEASE

[ATTACHED]

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RELEASE

The undersigned, DONZOIL LTD., in consideration of
  payments made to me under a Royalty Interest Repurchase Agreement dated as of
  the date hereof among Donzoil Ltd., Donald Umbach and Dynamic Oil & Gas,
  Inc. (the Company) hereby releases and forever discharges
  the Company, its subsidiaries and affiliates, their directors, officers, employees,
  agents, successors, executors, estates, assigns and representatives, of and
  from all manner of actions, causes of action, suits, debts, accounts, convenants,
  contracts, liabilities, expenses, claims and demands of every nature and kind
  whatsoever which it has had, now have or which any affiliates, associates, agents,
  successors, personal representatives, assigns or administrators or any of them,
  hereafter can, shall or may have against the Company, its subsidiaries and affiliates,
  their directors, officers, employees, agents, successors, executors, estates,
  assigns and representatives, for or by reason of any cause, matter or thing
  whatsoever in connection with certain royalty interests (the Royalty
  Interests) in respect of petroleum substances within, upon or under
  certain lands in which the Company had an interest, including, without limitation,
  any and all liens, charges, security interests, obligations, liabilities, arrangements
  and payments under the Overriding Royalty Agreement dated as of July 13, 1990
  between Donzoil Ltd. and the Company.

The undersigned,DONZOIL LTD. also hereby acknowledges
  and warrants that it has had an opportunity to consult and obtain advice from
  its own solicitors before entering into this Release.

IN WITNESS WHEREOF the undersigned has hereunto set his hand
  and seal this 6th day of July, 2003.

|DONZOIL LTD. |                       
|------------ | ----------------------
|             |                       
|             |                       
|Per:         |                       
|             | (Authorized Signatory)

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RELEASE

I, DONALD UMBACH, in consideration of payments made
  to me under a Royalty Interest Repurchase Agreement dated as of the date hereof
  among Donzoil Ltd., Donald Umbach and Dynamic Oil & Gas, Inc. (the Company)
  hereby release and forever discharge the Company, its subsidiaries and affiliates,
  their directors, officers, employees, agents, successors, executors, estates,
  assigns and representatives, of and from all manner of actions, causes of action,
  suits, debts, accounts, convenants, contracts, liabilities, expenses, claims
  and demands of every nature and kind whatsoever which I have had, now have or
  which any affiliates, associates, agents, successors, personal representatives,
  assigns or administrators or any of them, hereafter can, shall or may have against
  the Company, its subsidiaries and affiliates, their directors, officers, employees,
  agents, successors, executors, estates, assigns and representatives, for or
  by reason of any cause, matter or thing whatsoever in connection with certain
  royalty interests (the Royalty Interests) in respect of petroleum
  substances within, upon or under certain lands in which the Company had an interest,
  including, without limitation, any and all liens, charges, security interests,
  obligations, liabilities, arrangements and payments under the Overriding Royalty
  Agreement dated as of August 31, 1990 between Donzoil Ltd. and the Company.

I,DONALD UMBACHalso hereby acknowledge and warrant
  that I have had an opportunity to consult and obtain advice from my own solicitors
  before entering into this Release and I have read this Release and know the
  contents and fully understand them.

IN WITNESS WHEREOF the undersigned has hereunto set his hand
  and seal this 6th day of July, 2003.

|Signed, Sealed and Delivered by DONALD | ) |               |       
|-------------------------------------- | - | ------------- | ------
|UMBACH:                                | ) |               |       
|                                       | ) |               |       
|In the presence of:                    | ) |               |       
|                                       | ) |               |       
|                                       | ) |               |       
|Witness (Signature)                    | ) | Donald Umbach | (seal)
|                                       | ) |               |       
|                                       | ) |               |       
|Name (Please print)                    | ) |               |       

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SCHEDULE B - CONVEYANCE

[ATTACHED]

---

GENERAL CONVEYANCE AND ASSUMPTION OF LIABILITIES AGREEMENT 
  (Section 8(f))

This General Conveyance Agreement (this Conveyance)
  dated July 6, 2003 is made

B E T W E E N

DONZOIL LTD.(the Seller)

- and -

DYNAMIC OIL & GAS, INC. (the Purchaser)

WHEREASpursuant to a royalty interest repurchase agreement made between the Seller,
  the Purchaser and Donald Umbach dated July 6, 2003 (the Agreement),
  the Seller has agreed to sell to the Purchaser and the Purchaser has agreed
  to purchase from the Seller certain royalty interests, all on the terms and
  conditions more particularly set out therein;

THIS
  CONVEYANCE WITNESSES that in pursuance of the Agreement and for good and
  valuable consideration, the receipt and adequacy of which are hereby acknowledged
  by the parties, the parties agree as follows:

1.                        Unless
  otherwise stated, the terms used in this Conveyance have the meanings given
  to them in the Agreement.

2.                        The
  Seller hereby absolutely and irrevocably grants, bargains, sells, assigns, transfers,
  conveys and sets over the Royalty Interests, with effect as of July 7, 2003,
  together with all the Sellers right, title, interest, property, claim
  and demand in and to the Royalty Interests, to the Purchaser, its successors
  and assigns, to have and to hold the said Royalty Interests and all such right,
  title, interest, property, claim and demand unto and to the use of the Purchaser,
  its successors and assigns.

3.                         The
  Seller covenants, represents and warrants as follows:

| | (a) | The Seller is now rightfully and absolutely
        possessed of and entitled to the Royalty Interests and every part thereof,
        and the Seller now has good right to transfer and assign the same to the
        Purchaser, and the Purchaser shall and may immediately upon the execution
        and delivery of this Conveyance have possession of and may from time to
        time and at all times hereafter peaceably and quietly have, hold, possess
        and enjoy the Royalty Interests and every part thereof to and for its
        own use and benefit without any manner of hindrance, interruption, molestation,
        claim or demand of, from or by the Seller or any other Person and free
        and clear and absolutely released and discharged from and against all
        former and other bargains, sales, gifts, grants and Encumbrances.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (b) | The Seller will from time to time and
        at all times hereafter, upon every reasonable request of the Purchaser,
        make, do and execute or cause and procure to be made, done and executed
        all such further acts, deeds or assurances as may be reasonably                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

---

- 2 -

| |     | required by the Purchaser to give effect to this
        Conveyance, whether for more effectually and completely vesting in the
        Purchaser the Royalty Interests or for the purpose of registration or
        otherwise.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (c) | In any instance where the Seller has
        not complied with the provisions of Section 3(b) hereof, the Seller on
        behalf of itself and its successors hereby irrevocably appoints any Director
        for the time being of the Purchaser as the true and lawful attorney of
        the Seller to do, sign and execute all acts, deeds, assurances and other
        instruments which in the discretion of the said attorney may be necessary,
        desirable or expedient for the purpose of vesting in the Purchaser the
        Royalty Interests. Such power of attorney, being coupled with an interest,
        shall not be revoked by the dissolution of the Seller and may be exercised
        in the name and on behalf of the Purchaser.

4.                         This
  Conveyance is delivered pursuant to, and is subject to all of the terms and
  conditions contained in, the Agreement. In the event of any inconsistency between
  the provisions of this Conveyance and the provisions of the Agreement, the provisions
  of the Agreement shall prevail.

5.                         This
  Conveyance shall be governed by and construed in accordance with the laws of
  the province of British Columbia and the laws of Canada applicable therein.
  This Conveyance shall enure to the benefit of and be binding upon the parties
  and their respective successors and permitted assigns.

IN
  WITNESS WHEREOF the parties have executed this Conveyance.

|DYNAMIC OIL & GAS, INC. |                       
|----------------------- | ----------------------
|                        |                       
|Per:                    | David Jennings      
|                        | (Authorized Signatory)
|                        |                       
|DONZOIL LTD.            |                       
|                        |                       
|Per:                    | Donald Umbach       
|                        | (Authorized Signatory)

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