____________________

                               Hyperdynamics Corp.
                               -------------------
                              ____________________

    This offering consists of $1,500,000 of the Company's 5 Year Convertible
                         Debentures convertible into the
                             Company's Common Stock.

                              ____________________

                             SUBSCRIPTION AGREEMENT

                               ___________________

SUBSCRIPTION  PROCEDURES

     Convertible  Debentures  of  Hyperdynamics  Corp. and it's subsidiaries(the
    ----------------------------------------------------------------------------
"Company")  are being offered (the "Debentures"). This offering is being made in
accordance with the exemptions from registration provided for under Section 4(2)
of  the  Securities  Act  of  1933,  as amended (the "1933 Act") and Rule 506 of
Regulation  D  promulgated  under  the  1933  Act.

     In  order to purchase Debentures, each subscriber must complete and execute
a  questionnaire  (the  "Questionnaire")  and  a  subscription  agreement  (the
"Subscription  Agreement").  In  addition,  the  subscriber  must make a payment
pursuant to the Funds Authorization Distribution Agreement, for the amount being
purchased  or  directly  to  the  Holder.  All  subscriptions  are  subject  to
acceptance  by the Company, which shall not occur until the Company has returned
the  signed  Company  Signature  Page.

          The  Questionnaire is designed to enable the Holder to demonstrate the
minimum  legal  requirements under federal and state securities laws to purchase
the  Debentures.  The  Signature Page for the Questionnaire and the Subscription
Agreement  contain  representations  relating  to the subscription and should be
reviewed  carefully  by  each  subscriber.

     If  you  are  a  foreign  person or foreign entity, you may be subject to a
withholding  tax  equal  to  thirty  percent  (30%) of any dividends paid by the
Company.  In order to eliminate or reduce such withholding tax you must submit a
properly  executed I.R.S. Form 4224 (Exemption from Withholding of Tax on Income
Effectively  Connected  with  the  Conduct  of a Trade or Business in the United
States)  or I.R.S. Form 1001 (Ownership Exemption or Reduced Trade Certificate),
claiming  exemption  from  withholding or eligibility for treaty benefits in the
form  of  a  lower  rate  of  withholding  tax  on  interest  or  dividends.

     Payment  must  be  made by wire transfer by Dutchess Private Equities Fund,
II,  LP  (the  "Holder") per the wire instructions that will be established.  In
the  event  of a termination of the offering or the rejection of a subscription,
subscription  funds will be returned by the Company without interest or charges.

THE  SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND ARE BEING OFFERED AND SOLD
IN  RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SUCH LAWS.  THE
SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT
BE  TRANSFERRED  OR  RESOLD  EXCEPT  AS  PERMITTED  UNDER  SUCH LAWS PURSUANT TO
REGISTRATION  OR  AN EXEMPTION THEREFROM.  THE SECURITIES HAVE NOT BEEN APPROVED
OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY OTHER REGULATORY
AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE
MERITS  OF  THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THE OFFERING MATERIALS.
ANY  REPRESENTATION  TO  THE  CONTRARY  IS  UNLAWFUL.


SUBSCRIPTION  AGREEMENT
-----------------------


To:     Hyperdynamics  Corp.
        --------------------

     This Subscription Agreement is made between Hyperdynamics Corp., a Delaware
                                                 --------------------
corporation,  (the "Company"), and the undersigned prospective Holder ("Holder")
who  is  subscribing  hereby  for  the  Company's  convertible  debentures  (the
"Debentures")  on  August  12,  2005.  This  subscription is submitted to you in
accordance  with  and  subject  to  the  terms  and conditions described in this
Subscription  Agreement,  together  with  any  Exhibits  thereto, relating to an
offering  (the  "Offering")  of  One  Million  Five  Hundred  Thousand  dollars
($1,500,000)  of Debentures. The Offering is limited to accredited Investors and
is  made  in accordance with the exemptions from registration provided for under
Section  4(2) of the 1933 Act and Rule 506 of Regulation D promulgated under the
1933  Act  ("Regulation  D").

     Whereas,  contemporaneously  with  the  execution  and  delivery  of  this
Agreement,  the  partiers  hereto  are  executing  and  delivering  a  Debenture
Registration  Rights Agreement, the Debenture Agreement, Security Agreement, the
Irrevocable  Transfer  Agent Agreement, and Warrant Agreement (collectively, the
"Transaction  Documents").

1.     SUBSCRIPTION.
       ------------

     (a)     The  closing  shall  be  deemed to have occurred on the date in the
preamble  of  this  document  (the  "Closing Date" or a "Closing").  The Company
shall pay ten percent (10%) annual coupon on the unpaid principal amount of this
Debenture (the "Debenture") at such times and in such amounts as outlined in the
Debenture  Agreement.

     (b)     Upon  receipt  by  the  Company  of  the  requisite payment for the
Debentures being purchased, the Debentures so purchased will be forwarded by the
Company  to  the  Holder or its broker, as listed on the signature page, and the
name  of  such  Holder will be registered on the Debenture transfer books of the
Company  as  the  record  owner  of  such  Debentures.

     (c)     As long as the Holder owns the Debenture, the Holder shall have the
right  to  change  the  terms for the balance of the Debenture it then holds, to
match  the  terms  of  any  other  offering  of  securities made by the Company.

     (d)   The  Holders  shall  fund  one  million dollars ($1,000,000) upon the
initial  closing  and  an  additional  five  hundred thousand dollars ($500,000)
simultaneously on  the date the registration statement covering this Offering is
filed  with  the  United  States  Securities  and  Exchange Commission ("SEC"),.


2.     REPRESENTATIONS  AND  WARRANTIES  OF  THE  HOLDER.
       -------------------------------------------------
     The  Holder hereby represents and warrants to, and agrees with, the Company
as  follows:

     (a)     The  Holder  has  been  furnished  with, and has carefully read the
applicable  form  of  Debenture Registration Rights Agreement, and the Debenture
Agreement  and  is familiar with and understands the terms of the Offering. With
           ---
respect to tax and other economic considerations involved in his investment, the
Holder  is  not  relying on the Company. The Holder has carefully considered and
has, to the extent the Holder believes such discussion necessary, discussed with
the  Holder  's  professional  legal, tax, accounting and financial advisors the
suitability  of  an investment in the Company, by purchasing the Debentures, for
the Holder 's particular tax and financial situation and has determined that the
investment  being  made  by  the Holder is a suitable investment for the Holder.

     (b)     The  Holder  acknowledges  that  all  documents, records, and books
pertaining  to  this  investment  which  the Holder has requested have been made
available  for  inspection  or  the  Holder  has  had  access  thereto.

     (c)     The Holder has had a reasonable opportunity to ask questions of and
receive  answers  from  a  person  or  persons  acting  on behalf of the Company
concerning  the  Offering  and  if  such  opportunity  was  taken  then all such
questions  have  been  answered  to  the  full  satisfaction  of  the  Holder.

     (d)     The Holder will not sell, or otherwise dispose of the Debentures or
the  Common  Stock issued upon conversion of the Debentures without registration
under  the  1933  Act  or applicable state securities laws or compliance with an
exemption  therefrom  including  but  not limited to: Rule 144A, 144 (k) (herein
after  referred  to as an "Exemption").  The Debentures have not been registered
under  the  1933  Act  or under the securities laws of any state. Resales of the
Common  Stock underlying the Debentures or issued in payment of accrued interest
on  the  Debentures are to be registered by the Company pursuant to the terms of
the  Debenture Registration Rights Agreement incorporated herein and made a part
hereof.

     (e)     The Holder recognizes that an investment in the Debentures involves
substantial  risks,  including  loss  of  the  entire amount of such investment.
Further,  the  Holder  has  carefully  read and considered the schedule entitled
Litigation  matters  attached  hereto  as  Schedule  3(h).

     (f)     The  Holder  acknowledges  that  each  certificate representing the
Debentures  (and  the  shares  of  Common  Stock  issued  upon conversion of the
Debentures,  unless  registered or with an Exemption) or in payment of dividends
on  the  Debentures  shall  be  stamped  or  otherwise  imprinted  with a legend
substantially  in  the  following  form:

THE  SECURITIES  EVIDENCED  BY  THIS  CERTIFICATE  MAY  NOT  BE OFFERED OR SOLD,
TRANSFERRED,  PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT (i) PURSUANT
TO  AN  EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE SECURITIES ACT OF 1933, AS
AMENDED,  (ii)  TO THE EXTENT APPLICABLE, PURSUANT TO RULE 144 UNDER THE ACT (OR
ANY  SIMILAR  RULE UNDER SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES), OR
(iii)  PURSUANT  TO  AN  AVAILABLE  EXEMPTION  FROM REGISTRATION UNDER SUCH ACT.

     If Holder sends a Notice of Conversion (See Exhibit A attached hereto), and
provided  a  registration  statement under the Securities Act of 1933 that is in
effect  as  to  the sale, then in such event the Company shall have its transfer
agent  send  Holder  the  appropriate  number  of shares of Common Stock without
restrictive  legends  and  the  Company  is  not  subject  to  stop  transfer
instructions.

     (g)     If  this Subscription Agreement is executed and delivered on behalf
of  a  corporation:  (i) such corporation has the full legal right and power and
all  authority  and  approval  required (a) to execute and deliver, or authorize
execution  and delivery of this Subscription Agreement and all other instruments
(including,  without  limitation,  the  Debenture Registration Rights Agreement,
Irrevocable  Transfer Agent Agreement, Security Agreement, Warrant Agreement and
Debenture Agreements) executed and delivered by or on behalf of such corporation
in  connection  with the purchase of the Debentures and (b) to purchase and hold
the  Debentures;  and  (ii) the signature of the party signing on behalf of such
corporation  is  binding  upon  such  corporation.

     (h)     The Holder is not subscribing for the Debentures as a result of, or
pursuant to, any advertisement, article, notice or other communication published
in  any  newspaper,  magazine  or  similar media or broadcast over television or
radio  or  presented  at  any  seminar  or  meeting.

      (i)     The  Holder  is  purchasing the Debentures for its own account for
investment,  and  not  with  a  view  toward the resale or distribution thereof,
except pursuant to sales registered or exempted from registration under the 1933
Act.  The  Holder  has  not  offered or sold any portion of the Debentures being
acquired  nor  does  the  Holder  have  any  present  intention  of dividing the
Debentures with others or of selling, distributing or otherwise disposing of any
portion  of  the  Debentures either currently or after the passage of a fixed or
determinable  period  of  time  or  upon the occurrence or non-occurrence of any
predetermined  event  or  circumstance  in  violation  of the 1933 Act provided,
however,  that  by  making  the representations herein, Holder does not agree to
hold  any  of the Debentures for any minimum or other specific term and reserves
the  right  to  dispose  of  the  Debentures  at  any time in accordance with or
pursuant to a registration statement or an exemption under the 1933 Act.  Holder
is  neither  an  underwriter  of,  nor a dealer in, the Debentures or the Common
Stock  issuable upon conversion thereof or upon the payment of dividends thereon
and  is not participating in the distribution or resale of the Debentures or the
Common  Stock  issuable  upon  conversion  or  exercise  thereof.

     (j)     The Holder or the Holder's representatives, as the case may be, has
such  knowledge  and  experience in financial, tax and business matters so as to
enable  the  Holder  to  utilize the information made available to the Holder in
connection  with  the Offering to evaluate the merits and risks of an investment
in  the  Debentures  and  to  make  an informed investment decision with respect
thereto.

3.     REPRESENTATIONS  AND  WARRANTIES  OF  THE  COMPANY.
       --------------------------------------------------

     Except  as  set  forth  in  the  Schedules  attached  hereto,  the  Company
represents  and  warrants  to  the  Holder  that:

     a.     Organization  and Qualification.  The Company and its "SUBSIDIARIES"
            -------------------------------
(which for purposes of this Subscription Agreement means any entity in which the
Company,  directly  or  indirectly,  owns  capital  stock  or holds an equity or
similar  interest)  (a complete list of which is set forth in Schedule 3(a)) are
corporations duly organized and validly existing in good standing under the laws
of  the  respective jurisdictions of their incorporation, and have the requisite
corporate  power and authorization to own their properties and to carry on their
business  as now being conducted. Both the Company and its Subsidiaries are duly
qualified to do business and are in good standing in every jurisdiction in which
their  ownership  of  property  or  the nature of the business conducted by them
makes  such qualification necessary, except to the extent that the failure to be
so qualified or be in good standing would not have a Material Adverse Effect. As
used  in  this  Subscription  Agreement,  "MATERIAL  ADVERSE  EFFECT"  means any
material adverse effect on the business, properties, assets, operations, results
of  operations,  financial  condition  or  prospects  of  the  Company  and  its
Subsidiaries,  if  any,  taken  as  a whole, or on the transactions contemplated
hereby  or  by  the  agreements and instruments to be entered into in connection
herewith,  or  on  the  authority  or  ability  of  the  Company  to perform its
obligations  under  the Transaction Documents (as defined in Section 3(b)below).

     b.     Authorization;  Enforcement; Compliance with Other Instruments.  (i)
            --------------------------------------------------------------
The  Company  has  the requisite corporate power and authority to enter into and
perform  this  Subscription  Agreement,  the  Debenture  Registration  Rights
Agreement, Warrant Agreement, Security Agreement, Stock Transfer Agent Agreement
and  the  Debenture  Agreement, and each of the other agreements entered into by
the  parties  hereto  in  connection  with the transactions contemplated by this
Subscription Agreement (collectively, the "TRANSACTION DOCUMENTS"), and to issue
the  Debentures  in  accordance  with  the  terms  hereof  and thereof, (ii) the
execution  and  delivery  of  the  Transaction  Documents by the Company and the
consummation  by  it  of  the  transactions  contemplated  hereby  and  thereby,
including  without  limitation  the reservation for issuance and the issuance of
the  Debentures  pursuant  to  this  Subscription  Agreement, have been duly and
validly authorized by the Company's Board of Directors and no further consent or
authorization  is  required  by  the  Company,  its  Board  of Directors, or its
shareholders,  (iii)  the  Transaction  Documents  have  been  duly  and validly
executed  and  delivered  by  the  Company,  and  (iv) the Transaction Documents
constitute  the valid and binding obligations of the Company enforceable against
the Company in accordance with their terms, except as such enforceability may be
limited  by  general  principles of equity or applicable bankruptcy, insolvency,
reorganization,  moratorium,  liquidation  or  similar  laws  relating  to,  or
affecting  generally,  the  enforcement  of  creditors'  rights  and  remedies.

     c.     Capitalization.  As of the date hereof, the authorized capital stock
            --------------
of  the  Company  consists  of 250,000,000 shares of Common Stock authorized, of
which  as  of  the  date  hereof, approximately 42,059,683 shares are issued and
outstanding,  All  of  such  outstanding shares have been, or upon issuance will
be, validly issued and are fully paid and nonassessable.  Except as disclosed in
Schedule  3(c) which is attached hereto and made a part hereof, (i) no shares of
the  Company's  capital  stock  are  subject  to  preemptive rights or any other
similar  rights  or  any  liens  or  encumbrances  suffered  or permitted by the
Company,  (ii)  there  are  no  outstanding  debt securities, (iii) there are no
outstanding  shares  of  capital  stock,  options,  warrants,  scrip,  rights to
subscribe  to,  calls or commitments of any character whatsoever relating to, or
securities  or  rights  convertible  into,  any  shares  of capital stock of the
Company or any of its Subsidiaries, or contracts, commitments, understandings or
arrangements  by  which  the Company or any of its Subsidiaries is or may become
bound  to  issue additional shares of capital stock of the Company or any of its
Subsidiaries  or  options,  warrants,  scrip,  rights  to subscribe to, calls or
commitments  of  any  character  whatsoever relating to, or securities or rights
convertible  into,  any  shares  of  capital  stock of the Company or any of its
Subsidiaries,  (iv)  there  are  no  agreements  or arrangements under which the
Company  or  any of its Subsidiaries is obligated to register the sale of any of
their  securities  under  the 1933 Act (except the Debenture Registration Rights
Agreement), (v) there are no outstanding securities of the Company or any of its
Subsidiaries  which  contain any redemption or similar provisions, and there are
no  contracts,  commitments, understandings or arrangements by which the Company
or  any  of  its Subsidiaries is or may become bound to redeem a security of the
Company  or any of its Subsidiaries, (vi) there are no securities or instruments
containing  anti-dilution  or  similar  provisions that will be triggered by the
issuance  of  the  Securities as described in this Subscription Agreement, (vii)
the Company does not have any stock appreciation rights or "phantom stock" plans
or agreements or any similar plan or agreement and (viii) there is no dispute as
to  the  class  of  any  shares  of the Company's capital stock. The Company has
furnished to the Holder, or the Holder has had access through EDGAR to, true and
correct  copies  of the Company's Articles of Incorporation, as in effect on the
date  hereof (the "ARTICLES OF INCORPORATION"), and the Company's By-laws, as in
effect  on  the  date  hereof  (the "BY-LAWS '), and the terms of all securities
convertible  into or exercisable for Common Stock and the material rights of the
Holder  thereof  in  respect  thereto.

     d.     Issuance  of  Debentures.     A  sufficient  number  of  Debentures
            ------------------------
issuable pursuant to this Subscription Agreement, but not more than 4.99% of the
shares of Common Stock outstanding as of the date hereof (if the Company becomes
listed  on  Nasdaq or the American Stock Exchange), has been duly authorized and
reserved for issuance pursuant to this Subscription Agreement.  Upon issuance in
accordance  with  this  Subscription  Agreement,  the Debentures will be validly
issued,  fully paid and nonassessable and free from all taxes, liens and charges
with  respect  to  the issue thereof. In the event the Company cannot register a
sufficient  number  of  shares  of  Common Stock, due to the remaining number of
authorized  shares  of Common Stock being insufficient, the Company will use its
best  efforts  to  register  the  maximum  number  of shares it can based on the
remaining balance of authorized shares and will use its best efforts to increase
the  number  of  its  authorized  shares  as  soon  as  reasonably  practicable.

     e.     No  Conflicts.  The  execution,  delivery  and  performance  of  the
            -------------
Transaction  Documents by the Company and the consummation by the Company of the
transactions  contemplated hereby and thereby will not (i) result in a violation
of  the  Articles of Incorporation, any Certificate of Designations, Preferences
and  Rights  of  any outstanding series of preferred stock of the Company or the
By-laws  or  (ii)  conflict  with, or constitute a material default (or an event
which  with  notice  or  lapse  of time or both would become a material default)
under,  or  give to others any rights of termination, amendment, acceleration or
cancellation  of,  any  material  agreement,  contract,  indenture  mortgage,
indebtedness  or instrument to which the Company or any of its Subsidiaries is a
party, or result in a violation of any law, rule, regulation, order, judgment or
decree,  including  United  States  federal  and  state  securities  laws  and
regulations  and  the rules and regulations of the principal securities exchange
or  trading market on which the Common Stock is traded or listed (the "Principal
Market"),  applicable  to the Company or any of its Subsidiaries or by which any
property  or  asset  of  the  Company  or  any  of  its Subsidiaries is bound or
affected.  Except  as  disclosed  in  Schedule 3(e), neither the Company nor its
Subsidiaries  is  in violation of any term of, or in default under, the Articles
of Incorporation, any Certificate of Designations, Preferences and Rights of any
outstanding  series  of  preferred  stock of the Company or the By-laws or their
organizational  charter  or  by-laws,  respectively, or any contract, agreement,
mortgage,  indebtedness, indenture, instrument, judgment, decree or order or any
statute,  rule  or  regulation  applicable  to  the Company or its Subsidiaries,
except  for  possible  conflicts,  defaults,  terminations,  amendments,
accelerations,  cancellations  and  violations that would not individually or in
the  aggregate  have  a Material Adverse Effect. The business of the Company and
its  Subsidiaries  is  not  being  conducted,  and  shall  not  be conducted, in
violation  of  any  law,  statute,  ordinance,  rule, order or regulation of any
governmental  authority  or  agency,  regulatory  or  self-regulatory agency, or
court,  except  for  possible  violations  the  sanctions  for  which  either
individually  or  in  the  aggregate  would  not have a Material Adverse Effect.
Except  as  specifically  contemplated  by  this  Subscription  Agreement and as
required  under the 1933 Act, the Company is not required to obtain any consent,
authorization,  permit  or  order of, or make any filing or registration (except
the filing of a registration statement)  with, any court, governmental authority
or  agency,  regulatory  or self-regulatory agency or other third party in order
for  it  to  execute,  deliver  or  perform  any  of  its  obligations under, or
contemplated  by,  the Transaction Documents in accordance with the terms hereof
or  thereof.  All  consents,  authorizations,  permits,  orders,  filings  and
registrations  which the Company is required to obtain pursuant to the preceding
sentence  have  been obtained or effected on or prior to the date hereof and are
in  full force and effect as of the date hereof. Except as disclosed in Schedule
3(e), the Company and its Subsidiaries are unaware of any facts or circumstances
which  might give rise to any of the foregoing. The Company is not, and will not
be,  in  violation  of  the  listing  requirements of the Principal Market as in
effect  on  the date hereof and on each of the Closing Dates and is not aware of
any  facts  which  would reasonably lead to delisting of the Common Stock by the
Principal  Market  in  the  foreseeable  future.

     f.     SEC  Documents;  Financial  Statements.  Since  the date hereof, the
            --------------------------------------
Company  has filed all reports, schedules, forms, statements and other documents
required  to  be filed by it with the Securities and Exchange Commission ("SEC")
pursuant  to  the  reporting requirements of the  Securities and Exchange Act of
1934  ("1934  Act") (all of the foregoing filed prior to the date hereof and all
exhibits  included  therein  and  financial statements and schedules thereto and
documents incorporated by reference therein being hereinafter referred to as the
"SEC  DOCUMENTS").  The  Company  has  delivered  to  the  Holder  or  its
representatives,  or  they  have  had access through EDGAR, to true and complete
copies  of  the  SEC  Documents. As of their respective dates, the SEC Documents
complied  in all material respects with the requirements of the 1934 Act and the
rules  and  regulations  of the SEC promulgated thereunder applicable to the SEC
Documents,  and  none of the SEC Documents, at the time they were filed with the
SEC,  contained  any  untrue  statement of a material fact or omitted to state a
material  fact required to be stated therein or necessary to make the statements
therein,  in  light  of  the  circumstances  under  which  they  were  made, not
misleading.  As  of  their  respective  dates,  the  financial statements of the
Company  included  in  the  SEC  Documents  complied  as to form in all material
respects  with  applicable  accounting  requirements and the published rules and
regulations of the SEC with respect thereto. Such financial statements have been
prepared  in  accordance  with  generally  accepted  accounting  principles,
consistently  applied,  during  the  periods  involved  (except  (i)  as  may be
otherwise  indicated  in such financial statements or the notes thereto, or (ii)
in  the  case  of  unaudited  interim statements, to the extent they may exclude
footnotes  or  may be condensed or summary statements) and fairly present in all
material  respects the financial position of the Company as of the dates thereof
and  the  results  of  its  operations and cash flows for the periods then ended
(subject,  in  the  case  of  unaudited  statements,  to  normal  year-end audit
adjustments).  No  other  written  information  provided  by or on behalf of the
Company  to  the  Holder  which is not included in the SEC Documents, including,
without limitation, information referred to in Section 3(d) of this Subscription
Agreement,  contains  any  untrue statement of a material fact or omits to state
any  material fact necessary to make the statements therein, in the light of the
circumstance  under  which  they  are  or  were  made,  not  misleading.

     g.     Absence of Certain Changes.  Except as disclosed in Schedule 3(g) or
            --------------------------
the  SEC  Documents filed at least five (5) days prior to the date hereof, there
has  been  no  change  or  development  in  the  business,  properties,  assets,
operations,  financial  condition,  results  of  operations  or prospects of the
Company  or  its  Subsidiaries which has had or reasonably could have a Material
Adverse  Effect,  except  as  to litigation in connection with USOil, and events
unfolding  in  the Republic of Guinea elated to the Production Sharing Agreement
between  Guinea  and  USOil.  The  Company has not taken any steps, and does not
currently  expect  to  take  any  steps,  to  seek  protection  pursuant  to any
bankruptcy  law  nor  does the Company or its Subsidiaries have any knowledge or
reason  to  believe that its creditors intend to initiate involuntary bankruptcy
proceedings
     h.     Absence  of  Litigation.  Except  as  set forth in the Company's SEC
            -----------------------
filings,  there  is no action, suit, proceeding, inquiry or investigation before
or  by  any court, public board, government agency, self-regulatory organization
or body pending or, to the knowledge of the executive officers of Company or any
of  its  Subsidiaries,  threatened  against or affecting the Company, the Common
Stock  or  any  of  the  Company's  Subsidiaries  or any of the Company's or the
Company's  Subsidiaries'  officers  or directors in their capacities as such, in
which  an  adverse  decision  could  have  a  Material  Adverse  Effect,  except
litigation  in  connection  with USOil, and possible legal proceedings regarding
events unfolding in the Republic of Guinea related to the Production and Sharing
Agreement  between  Guinea  and  USOil.


     i.     Acknowledgment  Regarding  the  Purchase of Debentures.  The Company
            ------------------------------------------------------
acknowledges  and  agrees that the Holder is acting solely in the capacity of an
arm's  length  investor  with  respect  to  the  Transaction  Documents  and the
transactions  contemplated  hereby and thereby. The Company further acknowledges
that the Holder is not acting as a financial advisor or fiduciary of the Company
(or  in  any similar capacity) with respect to the Transaction Documents and the
transactions  contemplated hereby and thereby and any advice given by the Holder
or  any  of  its  respective  representatives  or  agents in connection with the
Transaction  Documents  and  the transactions contemplated hereby and thereby is
merely  incidental  to  the  Holder's  purchase  of  the Debentures. The Company
further  represents  to the Holder that the Company's decision to enter into the
Transaction Documents has been based solely on the independent evaluation by the
Company  and  its  representatives.

     j.     Intentionally  omitted.

     k.     Employee Relations.  Neither the Company nor any of its Subsidiaries
            ------------------
is  involved  in any union labor dispute nor, to the knowledge of the Company or
any of its Subsidiaries, is any such dispute threatened. Neither the Company nor
any of its Subsidiaries is a party to a collective bargaining agreement, and the
Company  and  its  Subsidiaries  believe that relations with their employees are
good.  No  executive  officer  (as  defined  in Rule 501(f) of the 1933 Act) has
notified  the Company that such officer intends to leave the Company's employ or
otherwise  terminate  such  officer's  employment  with  the  Company.

     l.     Intellectual  Property  Rights.  All  patents,  patent applications,
            ------------------------------
trademark  registrations and applications for trademark registration held by the
Company  are  owned  free  and  clear  of  all  mortgages,  liens,  charges  or
encumbrances  whatsoever.  No  licenses  have been granted with respect to these
items  and  the  Company  and  its Subsidiaries do not have any knowledge of any
infringement by the Company or its Subsidiaries of trademark, trade name rights,
patents, patent rights, copyrights, inventions, licenses, service names, service
marks,  service  mark  registrations,  trade  secret  or other similar rights of
others,  and, except as set forth on Schedule 3(l), there is no claim, action or
proceeding  being  made or brought against, or to the Company's knowledge, being
threatened  against,  the Company or its Subsidiaries regarding trademark, trade
name,  patents,  patent  rights,  invention,  copyright, license, service names,
service  marks,  service mark registrations, trade secret or other infringement;
and  the  Company and its Subsidiaries are unaware of any facts or circumstances
which  might give rise to any of the foregoing. The Company and its Subsidiaries
have  taken reasonable security measures to protect the secrecy, confidentiality
and  value  of  all  of  their  intellectual  properties.

     m.     Environmental  Laws.  The  Company  and  its Subsidiaries (i) are in
            -------------------
compliance  with  any  and all applicable foreign, federal, state and local laws
and  regulations  relating  to  the  protection  of human health and safety, the
environment  or  hazardous  or  toxic  substances  or  wastes,  pollutants  or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits, licenses or
other  approvals required of them under applicable Environmental Laws to conduct
their  respective  businesses  and  (iii)  are  in compliance with all terms and
conditions  of  any such permit, license or approval where, in each of the three
foregoing  cases,  the  failure  to so comply would have, individually or in the
aggregate,  a  Material  Adverse  Effect.

     n.     Title.  The  Company  and  its Subsidiaries have good and marketable
            -----
title  in  fee  simple to all real property and good and marketable title to all
personal property owned by them which is material to the business of the Company
and its Subsidiaries, in each case free and clear of all liens, encumbrances and
defects  except  such  as  are  described  in  Schedule  3(n)  or such as do not
materially  affect  the value of such property and do not interfere with the use
made  and  proposed  to  be  made  of such property by the Company or any of its
Subsidiaries.  Any  real property and facilities held under lease by the Company
or  any  of  its  Subsidiaries  are  held  by  them  under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with  the use made and proposed to be made of such property and buildings by the
Company  and  its  Subsidiaries.

     o.     Insurance.  The  Company and each of its Subsidiaries are insured by
            ---------
insurers  of  recognized  financial responsibility against such losses and risks
and  in  such  amounts  as  management of the Company believes to be prudent and
customary  in  the  businesses  in  which  the  Company and its Subsidiaries are
engaged.  Neither  the  Company  nor  any  such  Subsidiary has been refused any
insurance  coverage  sought  or applied for and neither the Company nor any such
Subsidiary  has  any  reason  to  believe  that it will not be able to renew its
existing  insurance  coverage  as  and  when  such coverage expires or to obtain
similar  coverage  from  similar  insurers  as  may be necessary to continue its
business  at  a  cost  that  would  not  have  a  Material  Adverse  Effect.

     p.     Regulatory  Permits.  The  Company and its Subsidiaries have in full
            -------------------
force  and  effect  all certificates, approvals, authorizations and permits from
the  appropriate  federal,  state,  local  or foreign regulatory authorities and
comparable foreign regulatory agencies, necessary to own, lease or operate their
respective  properties  and  assets and conduct their respective businesses, and
neither  the  Company  nor  any  such  Subsidiary  has  received  any  notice of
proceedings  relating to the revocation or modification of any such certificate,
approval,  authorization  or  permit,  except  for such certificates, approvals,
authorizations  or  permits  which  if  not  obtained,  or  such  revocations or
modifications  which,  would  not  have  a  Material  Adverse  Effect.

     q.     Internal  Accounting  Controls.  The  Company  and  each  of  its
            ------------------------------
Subsidiaries  maintain  a  system  of internal accounting controls sufficient to
provide  reasonable  assurance  that (i) transactions are executed in accordance
with  management's  general  or  specific  authorizations, (ii) transactions are
recorded  as  necessary  to  permit  preparation  of  financial  statements  in
conformity  with  generally accepted accounting principles and to maintain asset
accountability,  (iii)  access  to  assets  is permitted only in accordance with
management's  general  or  specific  authorization  and  (iv)  the  recorded
accountability  for  assets  is  compared with the existing assets at reasonable
intervals  and  appropriate  action  is  taken  with respect to any differences.

     r.     No  Materially  Adverse Contracts, Etc.  Neither the Company nor any
            --------------------------------------
of  its  Subsidiaries  is  subject  to  any  charter,  corporate  or other legal
restriction,  or  any  judgment,  decree, order, rule or regulation which in the
judgment  of  the  Company's officers has or is expected in the future to have a
Material  Adverse  Effect.  Neither the Company nor any of its Subsidiaries is a
party  to  any  contract  or  agreement  which  in the judgment of the Company's
officers  has  or  is  expected  to  have  a  Material  Adverse  Effect.

     s.     Tax  Status.  The  Company's  consolidated  2004  federal income tax
            -----------
return,  the  Company  and each of its Subsidiaries has made or filed all United
States  federal  and  state  income  and  all  other  tax  returns,  reports and
declarations  required  by  any  jurisdiction to which it is subject (unless and
only  to  the extent that the Company and each of its Subsidiaries has set aside
on  its  books  provisions reasonably adequate for the payment of all unpaid and
unreported  taxes) and has paid all taxes and other governmental assessments and
charges  that  are  material  in  amount,  shown or determined to be due on such
returns,  reports  and  declarations, except those being contested in good faith
and  has set aside on its books provision reasonably adequate for the payment of
all  taxes  for periods subsequent to the periods to which such returns, reports
or declarations apply.  There are no unpaid taxes in any material amount claimed
to  be  due by the taxing authority of any jurisdiction, and the officers of the
Company  know  of  no  basis  for  any  such  claim.

     t.     Certain  Transactions.  Except  as  set  forth  in the SEC Documents
            ---------------------
filed  at  least  ten  days prior to the date hereof and except for arm's length
transactions pursuant to which the Company makes payments in the ordinary course
of  business  upon  terms  no  less favorable than the Company could obtain from
third  parties  and  other than the grant of stock options disclosed on Schedule
3(c),  none of the officers, directors, or employees of the Company is presently
a  party  to  any transaction with the Company or any of its Subsidiaries (other
than for services as employees, officers and directors), including any contract,
agreement  or  other  arrangement providing for the furnishing of services to or
by,  providing  for rental of real or personal property to or from, or otherwise
requiring  payments to or from any officer, director or such employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in
which  any officer, director, or any such employee has a substantial interest or
is  an  officer,  director,  trustee  or  partner.

     u.     Dilutive  Effect.  The Company understands and acknowledges that the
            ----------------
number  of  shares  of  Common  Stock  issuable  upon purchases pursuant to this
Subscription Agreement will increase in certain circumstances including, but not
necessarily limited to, the circumstance wherein the trading price of the Common
Stock  declines  following  the  effective  date  of  the registration statement
covering the Common Stock underlying the Debentures (the "Effective Date").  The
Company's executive officers and directors have studied and fully understand the
nature  of  the  transactions  contemplated  by  this Subscription Agreement and
recognize that they have a potential dilutive effect.  The board of directors of
the  Company  has  concluded,  in  its  good  faith  business judgment that such
issuance  is  in  the  best  interests of the Company.  The Company specifically
acknowledges that, subject to such limitations as are expressly set forth in the
Transaction  Documents,  its  obligation  to  issue  shares of Common Stock upon
purchases  pursuant to this Subscription Agreement is absolute and unconditional
regardless  of  the dilutive effect that such issuance may have on the ownership
interests  of  other  shareholders  of  the  Company.

     v.   Additional Financings. The Company shall not, directly nor indirectly,
          ---------------------
without  the  prior  written consent of Holder, offer, sell, grant any option to
purchase,  or  otherwise  dispose  of (or announce any offer, sale, grant or any
option  to  purchase or other disposition) any of its Common Stock or securities
convertible  into  Common  Stock,  or file any registration statement, including
those  on  Form S-8,  for any securities (a "SUBSEQUENT FINANCING") for a period
of  360  (three  hundred  and  sixty  ) days after the Effective Date. ("Lock Up
Period")

During  the  twelve  (12)  month  period  following  Closing, or if there is any
outstanding  balance on the Debentures, the Holder shall retain a first right of
refusal  for any additional financings.  The Company must submit to the Holder a
duly authorized term sheet of the financing and the Holder may elect, in writing
within five (5) days, to exercise its right to finance the Company upon the same
terms  and  conditions.  In  the  event  the Holder chooses not to complete such
financing,  the  Company  may proceed with the proposed third-party financing on
the same terms and conditions as contained in the notice to Holder.  The Company
will file within three (3) business days any necessary documentation required by
the  SEC  to  reflect  the  Holder's  new  position.

Upon  receipt  by the Company of an aggregate amount of one million ($1,000,000)
in  financing  ("Threshold  Amount")  from  Holder  or another source, including
exercise  of  any  existing  Warrants  ,  the Company shall pay back one hundred
percent (100%) of the amount above the Threshold Amount to the Redemption of the
Debenture.  The  payment shall be made regardless of whether a Payment is due at
the  time  the  Company  reach  the  Threshold  Amount,  and for each financing.


4.     COVENANTS  OF  THE  COMPANY
       ---------------------------

     a.     Best  Efforts.  The  Company  shall  use  its best efforts timely to
            -------------
satisfy  each  of  the  conditions  to  be  satisfied  by it as provided in this
Subscription  Agreement.

     b.     Blue Sky.  The Company shall, at its sole cost and expense, make all
            --------
filings  and  reports  relating  to the offer and sale of the Debentures and the
Common  Stock  underlying  the  Debentures  as  required  under  the  applicable
securities  or  "Blue Sky" laws of such states of the United States as specified
by  the  Holder.

     c.     Reporting Status.  Until the earlier of (i) the date that the Holder
            ----------------
may sell all of the Common Stock underlying the shares acquired pursuant to this
Subscription  Agreement  without restriction pursuant to Rule 144(k) promulgated
under  the 1933 Act (or successor thereto), or (ii) the date on which the Holder
shall  have  sold  all  the  Common Stock underlying the Debentures, the Company
shall  file  all  reports required to be filed with the SEC pursuant to the 1934
Act, and the Company shall not terminate its status as a reporting company under
the  1934  Act.

     d.     Use  of Proceeds.     The Company shall use the entire proceeds from
            ----------------
this  Debenture  exclusively  to further the growth and interest of the Company,
specifically for the development of a) Oil production and drilling in the United
States  of  America  or  b)  the  Oil,  Gas and Mineral leases including but not
limited  to  the Company's interest in the following collateralized leases dated
October  1st,  2004 with: Katherine Breland Kelly of Jena, Louisiana for Section
8,  Township  6 North, Range 3 East, the north one-half of the Northwest quarter
less  four  acres,  comprising  of  sixteen  (16)  acres,  more  or  less ANDthe
                                                                          ---
development  of  the  Oil,  Gas  and  Mineral  lease dated October 13, 2004 with
Willard  J.  Norris  and  Shirley  L  Norris  of  Jena, Louisiana for Section 8,
Township  6  North, Range 3 East, the southeast quarter of the northwest quarter
including  Lot  23B, and 23A; .  Any other use of the funds contemplated herein,
shall  be  considered  a  breach  of  contract  and  an  event  of  Default.

     e.     Conditions  to  Closing,The  Company  shall  sign  the  Transaction
            ------------------------
Documents  with  Dutchess  Private  Equities  Fund,  II,  L.P.

     f.     Financial  Information.  The Company agrees to make available to the
            ----------------------
Holder  via  EDGAR  or other electronic means the following: (i) within five (5)
business  days  after  the  filing  thereof  with  the SEC, a copy of its Annual
Reports  on  Form  10-KSB,  its  Quarterly  Reports  on Form 10-QSB, any Current
Reports on Form 8-K and any Registration Statements or amendments filed pursuant
to  the  1933 Act; (ii) on the same day as the release thereof, facsimile copies
of  all  press  releases issued by the Company or any of its Subsidiaries, (iii)
copies  of  any  notices  and  other  information made available or given to the
shareholders  of  the  Company  generally,  contemporaneously  with  the  making
available or giving thereof to the shareholders and (iv) within two (2) calendar
days  of filing or delivery thereof, copies of all documents filed with, and all
correspondence sent to, the Principal Market, any securities exchange or market,
or  the  National  Association  of  Securities  Dealers,  Inc.

     g.     Reservation of Common Stock.  Subject to the following sentence, the
            ---------------------------
Company  shall  take  all  action necessary to at all times have authorized, and
reserved  for  the  purpose of issuance, a sufficient number of shares of Common
Stock to provide for the issuance of the Common Stock underlying the Debentures.
In  the  event  that  the  Company determines that it does not have a sufficient
number  of  authorized  shares of Common Stock to reserve and keep available for
issuance,  the  Company  shall  use  its  best efforts to increase the number of
authorized  shares  of  Common  Stock  by  seeking  shareholder approval for the
authorization  of  such  additional  shares.  The Holder shall have the right to
determine  the  amount of shares to be re-registered to satisfy the terms of the
Agreement.  Such  amount  must  be  usual  or  customary.

     h.     Listing.  The  Company  shall  promptly secure the listing of all of
            -------
the  Common  Stock  underlying the Debentures upon the Principal Market and each
other  national securities exchange and automated quotation system, if any, upon
which  shares  of  Common  Stock  are then listed (subject to official notice of
issuance)  and  shall  maintain,  such  listing.  The Company shall maintain the
Common  Stock's  authorization for quotation on the Principal Market, unless the
Holder  and  the  Company  agree  otherwise.  Neither the Company nor any of its
Subsidiaries  shall take any action which would be reasonably expected to result
in  the  delisting  or  suspension  of  the Common Stock on the Principal Market
(excluding  suspensions of not more than one trading day resulting from business
announcements  by the Company). The Company shall promptly provide to the Holder
copies  of  any  notices  it  receives  from  the Principal Market regarding the
continued  eligibility  of  the  Common  Stock  for  listing  on  such automated
quotation  system  or  securities  exchange.  The Company shall pay all fees and
expenses  in  connection  with  satisfying  its  obligations under this Section.

     i.     Transactions  With  Affiliates.  The  Company  shall  not, and shall
            ------------------------------
cause  each of its Subsidiaries not to, enter into, amend, modify or supplement,
or  permit  any  Subsidiary  to  enter  into,  amend,  modify or supplement, any
agreement,  transaction,  commitment  or  arrangement  with  any  of  its or any
Subsidiary's  officers, directors, persons who were officers or directors at any
time  during  the  previous  two  years,  shareholders who beneficially own five
percent  (5%)  or more of the Common Stock, or affiliates or with any individual
related by blood, marriage or adoption to any such individual or with any entity
in  which  any  such  entity  or  individual  owns  a  five percent (5%) or more
beneficial  interest  (each a "RELATED PARTY") during the Lock Up Period; except
for  (i)  customary  employment  arrangements and benefit programs on reasonable
terms  (including changes currently under discussion with the Company's Board of
Directors  concerning  the compensation, to be payable in stock, of the Chairman
of  the Board), (ii) any agreement, transaction, commitment or arrangement on an
arms-length  basis  on  terms no less favorable than terms which would have been
obtainable  from a person other than such Related Party, or (iii) any agreement,
transaction,  commitment  or  arrangement which is approved by a majority of the
disinterested directors of the Company. For purposes hereof, any director who is
also  an  officer of the Company or any Subsidiary of the Company shall not be a
disinterested  director  with  respect  to  any  such  agreement,  transaction,
commitment  or  arrangement. "AFFILIATE" for purposes hereof means, with respect
to  any person or entity, another person or entity that, directly or indirectly,
(i)  has  a  five percent (5%) or more equity interest in that person or entity,
(ii)  has five percent (5%) or more common ownership with that person or entity,
(iii)  Controls  that  person or entity, or (iv) shares common control with that
person  or  entity.  "CONTROL"  or  "CONTROLS"  for purposes hereof means that a
person  or  entity  has  the power, direct or indirect, to conduct or govern the
policies  of  another  person  or  entity.

     j.     Corporate  Existence.  The  Company  shall  use  its  commercially
            --------------------
reasonable  best efforts to preserve and continue the corporate existence of the
Company.

     k.     Notice  of Certain Events Affecting Registration.  The Company shall
            ------------------------------------------------
promptly  notify  Holder  upon  the occurrence of any of the following events in
respect  of  a  registration statement or related prospectus covering the Common
Stock  underlying  the  Debentures:  (i)  receipt  of any request for additional
information  by  the  SEC  or  any other federal or state governmental authority
during  the period of effectiveness of the registration statement for amendments
or  supplements  to  the  registration statement or related prospectus; (ii) the
issuance  by the SEC or any other federal or state governmental authority of any
stop  order  suspending  the  effectiveness of any registration statement or the
initiation  of  any  proceedings  for  that  purpose;  (iii)  receipt  of  any
notification  with  respect  to the suspension of the qualification or exemption
from qualification of any of the Common Stock underlying the Debentures for sale
in  any jurisdiction or the initiation or threatening of any proceeding for such
purpose;  (iv)  the happening of any event that makes any statement made in such
registration  statement  or  related  prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or
that  requires  the making of any changes in the registration statement, related
prospectus  or  documents  so  that, in the case of a registration statement, it
will  not  contain  any untrue statement of a material fact or omit to state any
material  fact required to be stated therein or necessary to make the statements
therein  not misleading, and that in the case of the related prospectus, it will
not  contain  any  untrue  statement  of  a  material  fact or omit to state any
material  fact required to be stated therein or necessary to make the statements
therein,  in  the  light  of  the  circumstances under which they were made, not
misleading; and (v) the Company's reasonable determination that a post-effective
amendment  to  the  registration statement would be appropriate, and the Company
shall  promptly make available to Holder any such supplement or amendment to the
related  prospectus.

     l.  Indemnification.  In  consideration  of  the  Holder's  execution  and
         ----------------
delivery  of  the this Agreement and the Debenture Registration Rights Agreement
and  acquiring  the Debentures hereunder and in addition to all of the Company's
other  obligations  under  the  Transaction Documents, the Company shall defend,
protect,  indemnify  and hold harmless the Holder and all of their shareholders,
officers,  directors,  employees and direct or indirect investors and any of the
foregoing  person's  agents  or  other  representatives  (including,  without
limitation,  those  retained in connection with the transactions contemplated by
this  Agreement)  (collectively, the "Indemnitees") from and against any and all
actions,  causes  of  action,  suits,  claims,  losses,  costs, penalties, fees,
liabilities  and  damages, and expenses in connection therewith (irrespective of
whether  any  such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable attorneys' fees and disbursements
(the  "Indemnified  Liabilities"), incurred by any Indemnitee as a result of, or
arising  out  of,  or  relating  to  (i)  any misrepresentation or breach of any
representation  or  warranty made by the Company in the Transaction Documents or
any  other  certificate,  instrument or document contemplated hereby or thereby,
(ii)  any  breach  of  any  covenant,  agreement  or  obligation  of the Company
contained  in  the Transaction Documents or any other certificate, instrument or
document  contemplated  hereby  or  thereby,  (iii) any cause of action, suit or
claim  brought  or made against such Indemnitee by a third party and arising out
of  or resulting from the execution, delivery, performance or enforcement of the
Transaction  Documents  or  any  other  certificate,  instrument  or  document
contemplated  hereby or thereby, (iv) any transaction financed or to be financed
in  whole  or in part, directly or indirectly, with the proceeds of the issuance
of the Debentures or (v) the status of the Holder as an investor in the Company,
except  insofar as any such untrue statement, alleged untrue statement, omission
or  alleged  omission  is  made  in reliance upon and in conformity with written
information  furnished  to  the  Company  by  the  Holder  which is specifically
intended  by  the  Holder  for  use  in the preparation of any such Registration
Statement,  preliminary  prospectus  or  prospectus.  To  the  extent  that  the
foregoing  undertaking  by  the Company may be unenforceable for any reason, the
Company  shall  make the maximum contribution to the payment and satisfaction of
each  of  the Indemnified Liabilities which is permissible under applicable law.
The  indemnity  provisions contained herein shall be in addition to any cause of
action  or  similar rights the Holder may have, and any liabilities to which the
Holder  may  be  subject.

     m.     Reimbursement.  If  (i)  Holder,  other  than by reason of its gross
            -------------
negligence  or  willful  misconduct,  becomes  involved  in  any capacity in any
action,  proceeding  or investigation brought by any shareholder of the Company,
in  connection  with  or  as  a  result  of the consummation of the transactions
contemplated by the Transaction Documents, or if Holder is impleaded in any such
action, proceeding or investigation by any person, or (ii) Holder, other than by
reason of its gross negligence or willful misconduct or by reason of its trading
of  the  Common  Stock  in a manner that is illegal under the federal securities
laws,  becomes  involved  in  any  capacity  in  any  action,  proceeding  or
investigation  brought  by  the  SEC  against  or  involving  the  Company or in
connection  with  or  as  a  result  of  the  consummation  of  the transactions
contemplated by the Transaction Documents, or if Holder is impleaded in any such
action,  proceeding  or  investigation by any person, then in any such case, the
Company  will  reimburse  Holder  for  its  reasonable  legal and other expenses
(including the cost of any investigation and preparation) incurred in connection
therewith,  as  such expenses are incurred. In addition, other than with respect
to  any  matter in which Holder is a named party, the Company will pay to Holder
the charges, as reasonably determined by Holder, for the time of any officers or
employees  of  Holder devoted to appearing and preparing to appear as witnesses,
assisting  in preparation for hearings, trials or pretrial matters, or otherwise
with  respect  to  inquiries, hearing, trials, and other proceedings relating to
the subject matter of this Subscription Agreement. The reimbursement obligations
of  the  Company  under this section shall be in addition to any liability which
the  Company may otherwise have, shall extend upon the same terms and conditions
to  any  affiliates of Holder that are actually named in such action, proceeding
or  investigation,  and  partners,  directors,  agents,  employees,  attorneys,
accountants,  auditors  and controlling persons (if any), as the case may be, of
Holder  and  any  such  affiliate,  and  shall  be binding upon and inure to the
benefit  of any successors of the Company, Holder and any such affiliate and any
such  person.

     n.  Transfer  Agent.  The  Company  covenants and agrees that, in the event
that  the  Company's  agency  relationship  with  the  transfer  agent should be
terminated  for  any  reason  prior  to  the  Maturity  Date  (as defined in the
Debenture  Agreement),  the  Company  shall  immediately  appoint a new transfer
agent.  and  shall  require  that the new transfer agent execute and agree to be
bound  by  the  terms of the Irrevocable Transfer Agent Instructions (as defined
herein).  The  Company  shall  be  up  to date with all payments to the transfer
agent.  ,  and  continue  to  pay  transfer agent as outlined in the Irrevocable
Transfer  Agent  Agreement.

5.     OPINION  LETTER/BOARD  RESOLUTION
       ---------------------------------

Prior  to  or  on  the  Closing  Date the Company shall deliver to the Holder an
opinion  letter signed by counsel for the Company in the form attached hereto as
Exhibit  D.

Prior to or on the Closing Date the Company shall deliver to the Holder a signed
Board  Resolution  authorizing  this Offering, which shall be attached hereto as
Exhibit  E.

     a.  144  Opinions

     If  the  Company's  counsel fails to provide a Rule 144 opinion letter in a
timely  manner,  then the Company shall: (a) pay the Investor's counsel to write
said  Rule 144 opinion letter; and (b) instruct the designated transfer agent to
accept  same  Rule  144  Opinion  letter.


6.     DELIVERY  INSTRUCTIONS;  FEES
       -----------------------------

     The  Debentures  being  purchased  hereunder shall be delivered to Dutchess
Private Equities Fund, L.P., II, on the Closing Date at which time funds will be
wired to the Company and the Debentures will be delivered to the Holder, per the
Holder's  instructions.

7.     UNDERSTANDINGS.
       --------------

     The  undersigned  understands,  acknowledges and agrees with the Company as
follows:

FOR  ALL  SUBSCRIBERS:

     a.     This  Subscription  may  be  rejected,  in  whole or in part, by the
Company  in its sole and absolute discretion at any time before the date set for
Closing  unless  the Company has given notice of acceptance of the undersigned's
subscription by signing this Subscription Agreement and delivering it to Holder.

     b.     No  U.S.  federal  or  state  agency  or  any  agency  of  any other
jurisdiction  has  made  any  finding or determination as to the fairness of the
terms  of  the  Offering for investment nor any recommendation or endorsement of
the  Debentures  or  the  Company.

     c.     The  representations,  warranties  and agreements of the undersigned
and  the  Company  contained  herein  shall  be true and correct in all material
respects  on  and as of the date of the sale of the Debentures as if made on and
as  of  such  date  and  shall  survive  the  execution  and  delivery  of  this
Subscription  Agreement  and  the  purchase  of  the  Debentures.

     d.     In  making  an  investment  decision, Holders must rely on their own
examination  of  the Company and the terms of the Offering, including the merits
and  risks  involved.  The  shares  have  not been recommended by any federal or
state securities commission or regulatory authority.  Furthermore, the foregoing
authorities  have  not confirmed the accuracy or determined the adequacy of this
document.  Any  representation  to  the  contrary  is  a  criminal  offense.

     e.     The Offering is intended to be exempt from registration by virtue of
Section  4(2)  of  the  1933  Act and the provisions of Regulation D thereunder,
which  is  in  part  dependent  upon the truth, completeness and accuracy of the
statements  made  by  the  undersigned  herein  and  in  the  Questionnaire.

     f.     It  is  understood  that  in  order not to jeopardize the Offering's
exempt  status  under  Section 4(2) of the 1933 Act and Regulation D, any Holder
may,  at a minimum, be required to fulfill the investor suitability requirements
thereunder.

     g.     The  shares  may  not  be  resold  except  as  permitted  under  the
securities act and applicable state securities laws, pursuant to registration or
exemption  therefrom.  Holder should be aware that they will be required to bear
the  financial  risks  of  this  investment  for  an  indefinite period of time.

8.     DISPUTES  SUBJECT  TO  ARBITRATION  GOVERNED  BY  MASSACHUSETTS  LAW
       --------------------------------------------------------------------

     a.     All  disputes  arising under this agreement shall be governed by and
interpreted  in  accordance  with the laws of the Commonwealth of Massachusetts,
without regard to principles of conflict of laws.  The parties to this agreement
will  submit all disputes arising under this agreement to arbitration in Boston,
Massachusetts before a single arbitrator of the American Arbitration Association
("AAA").  The  arbitrator  shall  be selected by application of the rules of the
AAA, or by mutual agreement of the parties, except that such arbitrator shall be
an  attorney  admitted to practice law in the Commonwealth of Massachusetts.  No
party  to  this agreement will challenge the jurisdiction or venue provisions as
provided  in  this  section.

9.     MISCELLANEOUS.
       -------------

     a.     Any  notices,  consents, waivers or other communications required or
permitted  to be given under the terms of this Subscription Agreement must be in
writing  and  will  be  deemed  to  have  been  delivered (i) upon receipt, when
delivered  personally;  (ii)  upon  receipt,  when sent by facsimile (provided a
confirmation  of  transmission  is  mechanically or electronically generated and
kept  on  file  by the sending party); or (iii) one (1) day after deposit with a
nationally  recognized  overnight  delivery  service,  in  each  case  properly
addressed to the party to receive the same.  The addresses and facsimile numbers
for  such  communications  shall  be:

If  to  the  Company:


Hyderdynamics  Corporation
9700  Bissonnet
Suite  1700
Houston,  TX  77036
Telephone:  713-353-9400
Facsimile:  713-353-9421

If  to  the  Holder:

     At  the  address  listed  in  the  Questionnaire.

     Each  party  shall provide five (5) business days prior notice to the other
party  of  any  change  in  address,  phone  number  or  facsimile  number.

     b.     All  pronouns and any variations thereof used herein shall be deemed
to  refer  to  the  masculine,  feminine, impersonal, singular or plural, as the
identity  of  the  person  or  persons  may  require.

     c.     Neither  this  Subscription Agreement nor any provision hereof shall
be  waived,  modified,  changed,  discharged,  terminated,  revoked or canceled,
except  by  an  instrument  in  writing  signed  by the party effecting the same
against  whom  any  change,  discharge  or  termination  is  sought.

     d.     Notices  required  or  permitted  to  be given hereunder shall be in
writing  and  shall be deemed to be sufficiently given when personally delivered
or  sent  by  facsimile  transmission:  (i) if to the Company, at it's executive
offices or (ii) if to the Holder, at the address for correspondence set forth in
the  Questionnaire,  or  at  such  other  address  as may have been specified by
written  notice  given  in  accordance  with  this  paragraph.

     e.     This  Subscription  Agreement  shall  be  enforced,  governed  and
construed  in  all  respects  in accordance with the laws of the Commonwealth of
Massachusetts,  as  such  laws are applied by Massachusetts courts to agreements
entered  into, and to be performed in, Massachusetts by and between residents of
Massachusetts,  and  shall  be  binding  upon the undersigned, the undersigned's
heirs,  estate  and  legal representatives and shall inure to the benefit of the
Company  and its successors.  If any provision of this Subscription Agreement is
invalid  or  unenforceable under any applicable statue or rule of law, then such
provisions  shall  be  deemed  inoperative  to  the  extent that it may conflict
therewith  and  shall be deemed modified to conform with such statute or rule of
law.  Any provision hereof that may prove invalid or unenforceable under any law
shall  not  affect the validity or enforceability of any other provision hereof.

     f.     This  Agreement  shall  not  be  assignable.

     g.     This Subscription Agreement, together with Exhibits A, B, C, D and E
attached  hereto and made a part hereof, constitute the entire agreement between
the  parties hereto with respect to the subject matter hereof and may be amended
only  by  a  writing  executed  by  both  parties  hereto.

     h.     This  Subscription  Agreement  may  be  executed  in  two  or  more
counterparts,  all  of  which  taken  together  shall constitute one instrument.
Execution  and  delivery of this Subscription Agreement by exchange of facsimile
copies  bearing  the facsimile signature of a party shall constitute a valid and
binding  execution  and  delivery  of this Subscription Agreement by such party.
Such  facsimile  copies  shall  constitute  enforceable  original  documents.


10.  Transfer  Agent  Instructions

     The  Company shall issue the Irrevocable Transfer Agent Instructions to its
transfer  agent  irrevocably appointing Dutchess Capital Management, LLC and its
managing  members  ("DCM"),  as  its  agent  for  purpose of having certificates
issued,  registered  in the name of the Holder or its respective nominee(s), for
the  issuance  of  Shares  representing  such  amounts  from  the respective for
conversions  or  warrants,  as  specified from time to time by the Holder to the
Company  upon  the  Conversion Date (as defined in the Debenture Agreement), and
for  any  and  all  Liquidated  Damages,  if any (as this term is defined in the
Debenture  Registration Rights Agreement). DCM shall be paid a cash fee of Fifty
Dollars  ($50)  for every occasion they act pursuant to the Irrevocable Transfer
Agent  Instructions. The Company shall not change its transfer agent without the
express  written  consent  of the Holder, which may be withheld by the Holder in
its  sole  discretion.  The  Company warrants that no instruction other than the
Irrevocable  Transfer Agent Instructions referred to in this Section 10, will be
given by the Company to its transfer agent and that the issuance of Shares shall
otherwise  be freely transferable on the books and records of the Company as and
to  the  extent provided in this Agreement and the Debenture Registration Rights
Agreement.  Nothing  in  this  Section  10  shall affect in any way the Holder's
obligations  and  agreement  to  comply with all applicable securities laws upon
resale of Shares. If the Holder provides the Company with an opinion of counsel,
in  form,  scope  and  substance customary for opinions of counsel in comparable
transactions to the effect that registration of a resale by the Holder of any of
the  Conversion  Shares  is  not  required under the 1933 Act, the Company shall
within  two  (2)  business days instruct its transfer agent to issue one or more
certificates  in such name and in such denominations as specified by the Holder.
The  Company  acknowledges that a breach by it of its obligations hereunder will
cause  irreparable harm to the Holder by vitiating the intent and purpose of the
transaction  contemplated hereby. Accordingly, the Company acknowledges that the
remedy  at  law  for  a  breach of its obligations under this Section 10 will be
inadequate  and  agrees,  in  the  event of a breach or threatened breach by the
Company of the provisions of this Section 10, that the Holder shall be entitled,
in  addition  to  all other available remedies, to an injunction restraining any
breach  and  requiring immediate issuance and transfer, without the necessity of
showing  economic  loss  and  without any bond or other security being required.

11.  Waiver:

The  Holder's  delay or failure at any time or times hereafter to require strict
performance  by  Company  of any undertakings, agreements or covenants shall not
waiver,  affect,  or  diminish  any  right of the Holder under this Agreement to
demand  strict  compliance and performance herewith. Any waiver by the Holder of
any  Event  of  Default  shall  not  waive or affect any other Event of Default,
whether  such Event of Default is prior or subsequent thereto and whether of the
same  or a different type. None of the undertakings, agreements and covenants of
the  Company  contained  in  this  Agreement,  and no Event of Default, shall be
deemed  to  have  been  waived by the Holder, nor may this Agreement be amended,
changed  or  modified,  unless such waiver, amendment, change or modification is
evidenced  by an instrument in writing specifying such waiver, amendment, change
or  modification  and  signed  by  the  Holder.

12.  Waiver  of  Jury  Trial.

AS  A  MATERIAL INDUCEMENT FOR EACH PARTY HERETO TO ENTER INTO THIS WARRANT, THE
PARTIES  HERETO  HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
RELATED  IN  ANY  WAY  TO THIS WARRANT AND/OR ANY AND ALL OF THE OTHER DOCUMENTS
ASSOCIATED  WITH  THIS  TRANSACTION.


          [BALANCE  OF  PAGE  INTENTIONALLY  LEFT  BLANK)

Hyperdynamics  Corp.
--------------------

QUESTIONNAIRE

     The information contained in this Questionnaire is being furnished in order
to  determine  whether the undersigned's subscription to purchase the Debentures
described  in  the  Subscription  Agreement  may  be  accepted.

     ALL  INFORMATION  CONTAINED  IN  THIS  QUESTIONNAIRE  WILL  BE  TREATED
CONFIDENTIALLY.  The  undersigned  understands,  however,  that  the Company may
present  this  Questionnaire  to  such parties as it deems appropriate if called
upon  to  establish that the proposed offer and sale of the Securities is exempt
from  registration  under  the  1933  Act, as amended.  Further, the undersigned
understands  that  the offering is required to be reported to the Securities and
Exchange  Commission,  NASDAQ  and  to  various  state securities and "blue sky"
regulators.

     IN ADDITION TO SIGNING THE SIGNATURE PAGE, IF REQUESTED BY THE COMPANY, THE
UNDERSIGNED  MUST  COMPLETE  FORM  W-9.

I.     PLEASE  CHECK  EACH  OF  THE  STATEMENTS  BELOW  THAT  APPLIES.

          1.     The  undersigned: (a) has total assets in excess of $5,000,000;
(b)  was not formed for the specific purpose of acquiring the securities and (c)
has  its  principal  place  of  business  in  ___________.

     2.     The  undersigned  is a natural person whose individual net worth* or
joint  net  worth  with  his  or  her  spouse  exceeds  $1,000,000.

     3.     The undersigned is a natural person who had an individual income* in
excess  of  $200,000  in  each  of  the two most recent years and who reasonably
expects  an  individual  income in excess of $200,000 in the current year.  Such
income  is  solely  that  of  the  undersigned  and  excludes  the income of the
undersigned's  spouse.

     4.     The  undersigned  is  a natural person who, together with his or her
spouse,  has  had  a joint income* in excess of $300,000 in each of the two most
recent  years and who reasonably expects a joint income in excess of $300,000 in
the  current  year.

*     For  purposes of this Questionnaire, the term "net worth" means the excess
of  total  assets  over total liabilities.  In determining "income", an investor
should  add  to  his  or  her  adjusted gross income any amounts attributable to
tax-exempt  income  received, losses claimed as a limited partner in any limited
partnership,  deductions  claimed  for  depletion, contributions to IRA or Keogh
retirement  plan, alimony payments and any amount by which income from long-term
capital  gains  has  been  reduced  in  arriving  at  adjusted  gross  income.


          5.     The  undersigned  is:

     (a)     a  bank  as  defined  in  Section  3(a)(2)  of  the  1933  Act;  or

     (b)     a  savings  and loan association or other institution as defined in
Section 3(a)(5)(A) of the 1933 Act whether acting in its individual or fiduciary
capacity;  or

     (c)     a  broker  or  dealer registered pursuant to Section 15 of the 1934
Act;  or

     (d)     an  insurance  company as defined in Section 2(13) of the 1933 Act;
or

     (e)     An  investment  company registered under the Investment Company Act
of  1940 or a business development company as defined in Section 2(a)(48) of the
Investment  Company  Act  of  1940;  or

     (f)     a  small  business  investment  company  licensed by the U.S. Small
Business  Administration  under  Section  301  (c)  or (d) of the Small Business
Investment  Act  of  1958;  or

X     6.     The  undersigned is an entity in which all of the equity owners are
accredited  investors.

<PAGE>
II.     HOLDER  INFORMATION.

     Name  of  Entity  ___Dutchess  Private  Equities  Fund,  II,  L.P._
                          ----------------------------------------------

Person's  Name  Douglas  Leighton  Title:_Managing  Member
                -----------------         ----------------

     State  of  Organization  ____Delaware___________________
                              ------------

     Principal  Business  Address  ___312  Stuart  St,  Third  Floor__
                                      ------------------------------

     City,  State,  Zip  Code  ______Boston,  MA  02116__________
                                     ------------------

     Taxpayer  Identification  Number  _____________________

-     Phone  __617-960-3570________  Fax  ___617-249-0947___
               ------------               ---------------

     Send  Correspondence  to:
          _______________________________________________
     _______________________________________________
     _______________________________________________

Hyperdynamics  Corp.
--------------------
SIGNATURE  PAGE
---------------

     Your  signature on this Signature Page evidences your agreement to be bound
by  the  Questionnaire, Subscription Agreement and Debenture Registration Rights
Agreement.

     1.     The undersigned hereby represents that (a) the information contained
in  the  Questionnaire  is  complete  and  accurate and (b) the undersigned will
notify  Company  immediately  if  any  material change in any of the information
      ---------
occurs  prior  to  the  acceptance  of  the  undersigned's subscription and will
promptly  send  Companywritten  confirmation  of  such  change.
                -------

     2.     The  undersigned signatory hereby certifies that he/she has read and
understands  the  Subscription  Agreement  and  Questionnaire,  and  the
representations  made  by  the  undersigned  in  the  Subscription Agreement and
Questionnaire  are  true  and  accurate.



           $1,500,000                         August  12,  2005
______________________________          ________________________
Amount  of  Debentures  being  purchased                    Date


     By:  /s/Douglas Leighton
                     (Signature)

Name:     Douglas  Leighton
----------------------------------------------
       (Please  Type  or  Print)

Title:  Managing  Member,
Dutchess  Capital  Management,  LLC;
General  Partner  to:
Dutchess  Private  Equities  Fund  II,  LP
----------------------------------------------
       (Please  Type  or  Print)

COMPANY  ACCEPTANCE  PAGE
-------------------------

This  Subscription  Agreement  accepted  and  agreed
to  this  12th  day  of  August,  2005.

By  Hyperdynamics  Corp.  and  duly authorized to sign on behalf of the Company:
------------------------

By:  /s/Kent Watts
     -----------------
     Kent  Watts,  CEO

LIST  OF  EXHIBITS
-----------------

EXHIBIT  A               Notice  of  Conversion
EXHIBIT  B               Debenture  Registration  Rights  Agreement
EXHIBIT  C               Debenture  Agreement
EXHIBIT  D               Opinion  of  Company's  Counsel
EXHIBIT  E               Board  Resolution

LIST  OF  SCHEDULES
-----------------

Schedule  3(a)     Subsidiaries
Schedule  3(c)     Capitalization
Schedule  3(e)     Conflicts
Schedule  3(g)     Material  Changes
Schedule  3(h)     Litigation
Schedule  3(l)     Intellectual  Property
Schedule  3(n)     Liens
Schedule  3(t)     Certain  Transactions

                                    Exhibit A

                              NOTICE OF CONVERSION
                              --------------------

(To  be  Executed  by  the  Registered  Owner  in  order  to  Convert Debenture)

     The  undersigned  hereby  irrevocably  elects,  as  of ________________, to
convert  $________________  of  its convertible debenture (the "Debenture") into
Common  Stock of Hyperdynamics Corp. (the "Company") according to the conditions
set  forth  in  the  Debenture  issued  by  the  Company.

Date  of  Conversion________________________________________________


Applicable  Conversion  Price________________________________________


Number  of  Debentures  Issuable  upon  this  Conversion_______________________


Name(Print)_  Dutchess  Private  Equities  Fund,  II,     LP_____
           ------------------------------------------     -------

Address______________312  Stuart  St,  3rd  Floor____________________________
                     --------------------------------------------------------


Phone_____617-960-3570_____________  Fax________617-249-0947___________
          ------------                          ------------





                    By:_______________________________________

                     EXHIBIT D OPINION OF COMPANY'S COUNSEL
                     --------------------------------------

Holders  of  [Company]  [Describe  Securities]          _______________,  2005


Re:     Hyperdynamics  Corp.
        --------------------
Ladies  and  Gentlemen:

     As counsel to Hyperdynamics Corp. (the "Company"), we are familiar with its
                   -------------------
Articles of Incorporation and Bylaws and with the corporate proceedings taken by
it  in  connection with the proposed issuance and sale of convertible debentures
(the "Securities") pursuant to the related Subscription Agreement (including all
Exhibits  and  Appendices  thereto)  (collectively  the  "Agreements").

     We  have  been  furnished with copies, certified or otherwise identified to
our  satisfaction,  of  the  Agreements, and have examined such other documents,
agreements  and  records as we deemed necessary to render the opinions set forth
below.

     In  conducting  our  examination,  we have assumed the following:  (i) that
each  of  the Agreements has been executed by each of the parties thereto in the
same  form  as  the  forms  which  we have examined, (ii) the genuineness of all
signatures, the legal capacity of natural persons, the authenticity and accuracy
of  all  documents submitted to us as originals, and the conformity to originals
of  all  documents submitted to us as copies, (iii) that each of  the Agreements
has  been  duly  and  validly authorized, executed and delivered by the party or
parties  thereto  other  than  the Company, and (iv) that each of the Agreements
constitutes  the  valid  and  binding  agreement of the party or parties thereto
other  than the Company, enforceable against such party or parties in accordance
with  the  Agreements'  terms.

     Based  upon  the  subject  to  the  foregoing,  we are of the opinion that:

     1.     The  Company has been duly incorporated and is validly existing as a
corporation  in  good  standing under the laws of the State of Delaware, and has
all  requisite  corporate  power and authority to own its properties and conduct
its  business.

     2.     The  authorized  capital  stock of the Company  consists of -_______
shares  of  Common  Stock,  .001  par  value  per  share,  ("Common  Stock").

     3.     The  Common Stock is registered pursuant to Section 12(b) or Section
12(g)  of  the  Securities  Exchange Act of 1934, as amended and the Company has
timely filed all the material required to be filed pursuant to Sections 13(a) or
15(d)  of  such  Act  for  a period of at least twelve months preceding the date
hereof;

     4.     When  duly  countersigned  by  the  Company's  transfer  agent  and
registrar, and delivered to you or upon your order against payment of the agreed
consideration  therefor in accordance with the provisions of the Agreements, the
Securities  [and  any  Common  Stock  to  be  issued  upon the conversion of the
Securities]  as  described  in  the  Agreements represented thereby will be duly
authorized  and  validly  issued,  fully  paid  and  nonassessable;

     5     The  Company has the requisite corporate power and authority to enter
into  the  Subscription Agreement and to sell and deliver the Securities and the
Common  Stock to be issued upon the conversion of the Securities as described in
the  Agreements;  each of the Agreements has been duly and validly authorized by
all  necessary  corporate action by the Company to our knowledge, no approval of
any  governmental  or  other  body is required for the execution and delivery of
each  of  the Agreements  by the Company or the consummation of the transactions
contemplated  thereby; each of the Agreements has been duly and validly executed
and  delivered  by  and  on  behalf  of  the Company, and is a valid and binding
agreement  of  the  Company, enforceable in accordance with its terms, except as
enforceability  may  be  limited  by  general  equitable principles, bankruptcy,
insolvency,  fraudulent  conveyance,  reorganization,  moratorium  or other laws
affecting  creditors rights generally, and except as to compliance with federal,
state,  and  foreign  securities  laws,  as  to  which  no opinion is expressed;

     6.     To  the  best  of  our  knowledge, after due inquiry, the execution,
delivery  and  performance  of  the Subscription Agreement and Securities by the
Company  and  the  performance of its obligations thereunder do not and will not
constitute  a  breach  or  violation  of  any of the terms and provisions of, or
constitute  a default under or conflict with or violate any provision of (i) the
Company's Certificate of Incorporation or By-Laws, (ii) any indenture, mortgage,
deed of trust, agreement or other instrument to which the Company is party or by
which  it  or  any  of  its  property  is bound, (iii) any applicable statute or
regulation  or  as  other, (iv) or any judgment, decree or order of any court or
governmental  body  having jurisdiction over the Company or any of its property.

     7.     To the best of our knowledge, after due inquiry, there is no pending
or threatened litigation, investigation or other proceedings against the Company
[except  as  described  in  Exhibit  A  hereto].

     8.     The  Company  complies with the eligibility requirements for the use
of  Form  SB-2,  under  the  Securities  Act  of  1933,  as  amended.

     This  opinion  is  rendered  only with regard to the matters set out in the
numbered  paragraphs  above.  No  other opinions are intended nor should they be
inferred.  This  opinion  is based solely upon the laws of the United States and
the  Commonwealth  of  Massachusetts  and  does not include an interpretation or
statement  concerning  the  laws of any other state or jurisdiction.  Insofar as
the  enforceability of the Subscription Agreement and Securities may be governed
by the laws of other states, we have assumed that such laws are identical in all
respects  to  the  laws  of  the  Commonwealth  of  Massachusetts.

     The  opinions  expressed  herein  are  given  to you solely for your use in
connection  with  the transaction contemplated by the Subscription Agreement and
Securities  and  may not be relied upon by any other person or entity or for any
other  purpose  without  our  prior  consent.

                                   Very  truly  yours,

                                  By:     _____________________

EXHIBIT  E  BOARD  RESOLUTIONS

          RESOLUTIONS OF THE BOARD OF DIRECTORS OF HYPERDYANMICS CORP.
                            EFFECTIVE AUGUST 12, 2005

The undersigned Directors of Hyperdynamics Corp., Inc. (the "Company") takes the
following  actions  by  consent  with  a  meeting.

IT  HAS  BEEN  RESOLVED:

The  officers  of  the  Company  are instructed to take all actions necessary to
execute,  deliver,  and  perform the steps required of the Company in connection
with  registration  of  shares  pursuant  to  the  Debenture  Agreement, Warrant
Agreement  and  Subscription Agreement of even date.  All shares have been fully
paid and should be issued without restrictive legend, or if the shares have been
not  registered  for sale under the Securities Act of 1933, as amended, then the
certificates  shall  be  marked  with  proper  legend.

FURTHER,  IT  HAS  BEEN  RESOLVED:

That each member of the Board jointly and individual hereby agree not to issue a
stop  transfer  order  on  any  of the shares defined herein, if the to Dutchess
Private  Equities  Fund,  II,  LP.  ("Dutchess")

FURTHER,  IT  HAS  BEEN  FURTHER  RESOLVED:

The  officers  do  hereby  consent  to  the  appointment  of Douglas Leighton of
Dutchess  Capital  Management, LLC to issue shares pursuant to the shares due to
the  Holder  as  outlined in the Irrevocable Transfer Agent Agreement solely for
the  benefit  of  Dutchess.

FURTHER,  IT  HAS  BEEN  RESOLVED:

That  the  board has given the requisite authority for the Company to enter into
the  Subscription  Agreement,  Warrant  Agreement, Security Agreement, Debenture
Agreement,  Debenture  Registration  Rights  Agreement,  Stock  Transfer  Agent
Agreement,  Investment  Agreement  and Equity Line Registration Rights Agreement
(collectively, the "Transaction Documents") with Dutchess Private Equities Fund,
II,  LP  ("Dutchess")  dated  August  12,  2005

FURTHER,  IT  HAS  BEEN  RESOLVED:

That  in  the  event  counsel  for  the  Company  is  unable to write an opinion
regarding  the  issuance  of Shares for any of the Transactions Documents, where
required,  that  the  Transfer  Agent  shall  accept the opinion of the Holder's
counsel.

FURTHER,  IT  HAS  BEEN  RESOLVED:

That  the board shall issue up to 500,000 shares of Common Stock pursuant to the
Warrant  Agreement  between  the  Company and Dutchess; and, up to the amount of
shares  registered  for  resale  in  the  SB-2  filed  for  Dutchess' underlying
Debentures.

This  resolution  is  signed by the Board, to be effective as of August 12, 2005

Date:     August  12,  2005

        /s/ Kent Watts
        -------------------------------
By:     Kent  Watts,  CEO  &  Chairman

     /s/ Albert  F.  Young
     -----------------------------
By:  Albert  F.  Young    Director

/s/ Harry  J.  Briers
----------------------------
Harry  J.  Briers   Director


/s/ Harold  A.  Poling
----------------------------
Harold  A.  Poling  Director

SCHEDULE  3(a)  SUBSIDIARIES

     None.

SCHEDULE  3(c)  CAPITALIZATION

SCHEDULE  3(e)  CONFLICTS

SCHEDULE  3(g)  MATERIAL  CHANGES

NONE

SCHEDULE  3(h)  LITIGATION

          none,  except  as  disclosed  in  the  company's  sec  filings.

SCHEDULE  3(l)  INTELLECTUAL  PROPERTY

                    NONE

SCHEDULE  3(n)  LIENS

SCHEDULE  3(t)  CERTAIN  TRANSACTIONS