January 3, 1996



Mr. Okan Ozdemir
Mr. Dursun Acikbas
Mr. Cetin Berkmen
Mr. Tugay Ince
Mr. Gazanfer Ugural
Darka Petrol Ticaret Ltd. Sti.

Dear Sirs:

Chaparral Resources, Inc., ("Chaparral") is pleased to present this offer to you
as shareholders  ("Shareholders") of Darka Petrol Ticaret Ltd. Sti.,  ("Darka"),
to purchase all of the issued and outstanding capital stock of Darka, ("Stock").
Note that this  offer  has  already  been  signed by  Chaparral  and by Barry W.
Spector (as escrow agent). Central Asian Petroleum (Delaware) Limited ["CAP(D)"]
will fax you a  version  signed by  CAP(D)  under  separate  cover.  Two  signed
duplicate  "hard  copies" of the  entire  Letter  Agreement,  along with a third
signed  version of the Escrow  Agreement,  are being  couriered to you. Upon the
full execution of this  facsimile  Letter  Agreement by all of the  Shareholders
[and by Darka and CAP(D),  for purposes of Paragraph 3(f) only],  including full
execution of Exhibits A-E by the relevant parties, and upon:

          (i)  receipt by Chaparral of facsimile  transmission  of such executed
               Letter Agreement and Exhibits A-E; and

          (ii) receipt by Escrow  Agent (as  described  in the Escrow  Agreement
               attached  hereto and  incorporated by this reference as Exhibit A
               to this Letter Agreement) of facsimile transmission of Exhibit B

prior to 4:00 p.m., United States Mountain Time, on January 4, 1996, this Letter
Agreement shall constitute a binding  contract,  effective as of January 4, 1996
("Effective Date") among the parties as to the following terms and conditions:

          1.   The  purchase  price for all of  Shareholders'  right,  title and
               interest  in and to the Stock  shall be (i)  $2,000,000.00  U.S.,
               plus (ii) 625,000 shares of restricted common stock of Chaparral.
               The purchase price shall be paid as follows:

                  a.  $300,000.00  shall  be  deposited  with the  escrow  agent
                  pursuant to the Escrow Agreement in cash or other  immediately
                  available funds on January 5, 1996, to be paid to Shareholders
                  upon Closing,  or as otherwise  disposed of under the terms of
                  the  Escrow  Agreement.  Should  Chaparral  fail to Close  for
                  reasons other than (i) the failure of  Shareholders  to Close,
                  (ii)   the   material   failure   of  any   of   Shareholders'
                  representations herein to be true and accurate or the material
                  breach by Shareholders of their warranties hereunder, or (iii)
                  the  discovery  of  any  material   adverse   effects   during
                  Chaparral's due diligence review under Section 3, below,  then
                  the  escrowed   funds  shall  be  paid  to   Shareholders   as
                  Shareholders'   full  and  exclusive  remedy  for  Chaparral's
                  failure to Close; and,

<PAGE>

                  b.  The  balance,   being   $1,700,000.00  shall  be  paid  to
                  Shareholders, at Closing, and the 625,000 shares of restricted
                  common stock of Chaparral shall be delivered at Closing to the
                  Shareholders as directed in writing by the Shareholders.

          2.   Closing will occur,  pursuant to the conditions hereof, within 60
               days following the Effective Date of this Letter Agreement.

          3.   Chaparral's offer is made subject to the following:

                  a.  Shareholders  shall terminate all employees of Darka,  pay
                  all termination benefits or other obligations of Darka to such
                  employees,   and  pay  or   otherwise   discharge   all  other
                  obligations  of  Darka  to  third  parties,  all on or  before
                  closing.

                  b.  Shareholders  shall be  entitled to all the  benefits  and
                  receipts and shall be liable for all costs, charges, expenses,
                  liabilities  and obligations in respect of the Stock and Darka
                  (other  than those  which may be  specifically  excluded  from
                  Shareholders'  representations and warranties) which accrue or
                  relate  to  any  period  before  Closing.  Shareholders  shall
                  reimburse  and  indemnify  Chaparral  against  any such costs,
                  charges, expenses,  liabilities and obligations which are paid
                  by Chaparral.  Chaparral shall be entitled to all the benefits
                  and  receipts  and shall be  liable  for all  costs,  charges,
                  expenses,  liabilities and obligations in respect of the Stock
                  and  Darka   (other   than  those  which   Shareholders   have
                  represented  and  warranted  against by virtue of this  Letter
                  Agreement) which accrue or relate to any period after


 Closing.  Chaparral shall reimburse and indemnify Shareholders against
any such costs, charges, expenses, liabilities and obligations which are paid
by Shareholders.

                  c. Chaparral  shall conduct a due diligence  review to confirm
                  the accuracy of the  representations  contained herein, and to
                  verify the accuracy of the  information  and data supplied and
                  to be supplied by Shareholders to Chaparral,  and to determine
                  the  existence  of any  adverse  conditions  or  circumstances
                  pertaining to the Stock or Darka. Shareholders agree that they
                  shall give Chaparral  access to the records and files of Darka
                  as required to complete its due  diligence  review.  Chaparral
                  agrees to keep all information  provided by Shareholders or by
                  Darka regarding the Stock or regarding Darka confidential.

                  d. Should there be, at the time of Closing,  in the reasonable
                  discretion of Chaparral, a material inconsistency or breach in
                  respect  of  the   representations   or  warranties  given  by
                  Shareholders  in or pursuant to this  Letter  Agreement,  or a
                  material  adverse  condition  pertaining  to the  Stock  or to
                  Darka, then, at Chaparral's  option, (i) this Letter Agreement
                  and the Escrow  Agreement  may be  terminated  and the parties
                  shall have no further  obligations to one another, or (ii) the
                  parties shall nevertheless proceed to Closing. Notwithstanding
                  the foregoing,  however, if there are material inconsistencies
                  or  breaches  due to  the  intentional  or  reckless  acts  or
                  omissions of  Shareholders,  then  Chaparral may seek whatever
                  remedies  and  compensation  from  Shareholders  that  may  be
                  available to it regardless of whether or not Chaparral  elects
                  to proceed to Closing.

<PAGE>

                  e. The Shareholders covenant that they shall suspend until the
                  date 60 days  after the  Effective  Date any and all claims of
                  default or  forfeiture  by Chaparral  with respect to payments
                  required  of  Chaparral  to CAP(G) on  December  1,  1995,  as
                  asserted in Darka's  letter to Mr. Murat Yazici dated December
                  12, 1995.

                  f. Darka,  Chaparral  and CAP(D)  covenant that they shall not
                  initiate,  attend, vote or otherwise participate in any CAP(G)
                  Members meetings,  voting, or agreements of any kind until the
                  date 60 days after the Effective  Date, or Closing,  whichever
                  comes first.

                  g.  Chaparral  shall   sell   the  fixed  assets  of  Darka to
                  Shareholders for U.S. $20,000 on the date of Closing.

          4.   Shareholders represent and warrant to Chaparral as follows, which
               representations  and  warranties  shall  be  deemed  repeated  at
               Closing and which shall survive Closing:

                  a.  Shareholders  have good and marketable title to the Stock,
                  and Darka has good and  marketable  title to all of its assets
                  and properties,  free and clear of all liens, encumbrances and
                  adverse  claims of any  nature;  Darka is not  subject  to any
                  liens,  judgments,  decrees,  encumbrances,  debts or  adverse
                  claims  of any  nature;  and  there  are  no  facts  known  to
                  Shareholders  which are likely to  prejudice  or endanger  the
                  Stock, Darka or the assets and properties of Darka.

                  b. With respect to any contracts  pertaining to Darka,  Darka,
                  to the best of  Shareholders'  knowledge,  is not in  material
                  violation or breach of any of the terms or  conditions  stated
                  therein,  nor does Darka have any  outstanding  obligations in
                  connection with any such contracts.

                  c.  Shareholders  have the full power and  authority  to enter
                  into  and  perform  the  transactions  hereunder,  and  do not
                  require the consent of any other  persons,  firms or entities,
                  and no person,  firm or entity has any  preferential  purchase
                  right  with  respect to any  portion of the Stock,  nor is any
                  portion  of the  Stock  subject  to any  pending  or  existing
                  agreement to sell any portion of the Stock.

                  d.   The undersigned  are the sole and exclusive  shareholders
                  of  all authorized, issued and  outstanding  capital  stock or
                  other rights of ownership of Darka.

                  e.  Darka  has the sole  legal  and  beneficial  ownership  of
                  125,000 shares of Central Asian Petroleum  (Guernsey)  Limited
                  stock,   representing   twenty  five  percent   (25%)  of  the
                  outstanding  stock  of  Central  Asian  Petroleum   (Guernsey)
                  Limited,  (herein  "CAP(G)"),  and Darka has no obligations to
                  any third party with respect to that stock.


<PAGE>

                  f.  Shareholders  shall  ensure that the  representations  and
                  warranties  above  shall be true  and  accurate.  However,  if
                  notwithstanding  those efforts of Shareholders,  any matter or
                  thing occurs of which any Shareholder is aware and which would
                  be   inconsistent   with  or  in   breach   of  any  of  those
                  representations  and warranties,  then that Shareholder  shall
                  promptly notify Chaparral thereof in writing.


               5. a. Messrs. Okan  Ozdemir and  Dursun Acikbas have executed and
                  delivered the respective  Appointments  of  Alternate Director
                  of CAP(G)  (appointing, respectively, Mr.  Frank C. Alexander,
                  Jr. and  Mr. Jay W. McGee)  attached  hereto and  incorporated
                  by reference  as Exhibit B and C,  contemporaneously with this
                  Letter  Agreement,  and  each of  them also  hereby  covenants
                  that he shall not:

                    i.   attend any  future  meetings  of the CAP(G)  Board as a
                         member of the CAP(G) Board of Directors,  or in any way
                         exercise his vote as a Director of CAP(G);

                    ii.  remove Mr. Frank C.  Alexander,  Jr., or Mr. Jay McGee,
                         as the case may be, from office as alternate  Director;
                         or

                    iii. appoint any other alternate Directors

                  for  a period  of 60  days following the Effective Date, or at
                  all should Closing occur.


                  b. Messrs. Okan Ozdemir and Dursun  Acikbas have  executed and
                  delivered  the  respective  Exclusive Proxies  [appointing Mr.
                  Paul  Hoovler  and  Mr.  Jay  McGee,   respectively,  as their
                  exclusive  proxies to  vote in their place as CAP(G) appointed
                  KKM  Board  Members],  attached  hereto  and  incorporated  by
                  reference  as Exhibits D  and E,  contemporaneously  with this
                  Letter  Agreement,  and  each of  them also  hereby  covenants
                  that he shall not:


                    i.   attend any future meetings of the KKM Board as a member
                         of the KKM Board of  Directors,  or in any way exercise
                         his vote as a Director of KKM;

                    ii.  revoke  the  respective  Exclusive  Proxies  to Messrs.
                         Hoovler and McGee; or

                    iii. provide such proxies to any other persons;

                  for a period  of 60  days  following the Effective Date, or at
                  all should Closing occur.

         6.     Closing shall occur at the offices of Chaparral, and at Closing:

                  a. Chaparral shall  direct  the Escrow  Agent to  deliver  the
                  Escrow Funds to Shareholders;
<PAGE>

                  b.  Chaparral   shall   pay  $1,700,000  to  Shareholders  in
                  immediately available funds;

                  c. Chaparral shall deliver 625,000 shares of restricted common
                  stock in Chaparral  to the  Shareholders  in  accordance  with
                  their written instructions; and

                    d. Shareholders shall deliver all certificates  representing
                  the Stock to Chaparral,  together  with executed  stock powers
                  and such other instruments as may be required to vest complete
                  ownership of the Stock and of Darka in Chaparral.

         7. Upon Closing,  Shareholders  shall be deemed to have waived, any and
         all rights and claims of any nature,  whether  accruing before or after
         Closing, under any Member Agreements,  Protocols, Minutes or agreements
         of any nature, pertaining to CAP(G), Chaparral and/or CAP(D).

         8.   This  Letter  Agreement  shall be  construed  in  accordance  with
         the laws of the State of Colorado,  United States of America.  Any and
         all disputes arising  hereunder which cannot be resolved by good faith
         negotiation shall be submitted to binding arbitration to  be  conducted
         by  the  American  Arbitration Association (AAA) in accordance with its
         Commercial  Arbitration  Rules.   All  arbitration  hearings  shall  be
         conducted in Denver, Colorado.

         9. This offer will remain open through  4:00 p.m.,  Mountain  Time,  on
         January 4, 1996,  unless rejected in writing by  Shareholders  prior to
         that time,  upon which  rejection  this offer will be deemed revoked by
         Chaparral.  By accepting this Letter Agreement Shareholders covenant to
         immediately  courier to Chaparral  and to Escrow  Agent,  respectively,
         fully executed  "hard copies" of the respective  documents as described
         in the first paragraph of this Letter Agreement.

         10.  Upon your  acceptance  of this  offer,  you agree not to  solicit,
         directly or  indirectly,  any other party,  nor to  negotiate  with any
         other party for the sale of any portion of the Stock for a period of 60
         days after the Effective Date.

This Letter  Agreement  may be executed in any number of  counterparts  and each
such  counterpart  shall be  deemed  an  original  Agreement  for all  purposes;
provided no party shall be bound by the terms of this Agreement unless and until
all  parties  have  executed a  counterpart.  For  purposes  of  assembling  all
counterparts into one document,  Chaparral is authorized to detach the signature
page from one or more  counterparts  and, after signing by the respective party,
attach each signed signature page to a counterpart.

In the event  that you wish to contact  Chaparral  with  respect to this  offer,
please contact Mr. Paul V. Hoovler at (303) 293-2340.

Very truly yours,

CHAPARRAL RESOURCES, INC.

/s/ Paul V. Hoovler
------------------------------
Paul V. Hoovler, President


SHAREHOLDERS

<PAGE>


/s/ Ikan Ozdemir
------------------------------
Okan Ozdemir

/s/ Dursan Acikbas
------------------------------
Dursan Acikbas

/s/ Cetin Berkmen
------------------------------
Cetin Berkmen

/s/ Tugay Ince
------------------------------
Tugay Ince

/s/ Gazanger ugural
------------------------------
Gazanger Ugural


Darka Petrol Ticaret Ltd. Sti. [for purposes of Paragraph 3(f) only]

/s/ Okan Ozdemir
------------------------------
by:  Okan Ozdemir, President


Central Asian Petroleum (Delaware) Limited [for purposes of Paragraph 3(f) only]

/s/ Paul V. Hoovler
------------------------------
by:  Paul V. Hoovler, President

<PAGE>
                                    EXHIBIT A

                                ESCROW AGREEMENT


     This ESCROW AGREEMENT  entered this 4th day of January,  1996, by and among
the undersigned  shareholders  of Darka Petrol Ticaret Ltd. Sti.,  (collectively
"Shareholders")  and  CHAPARRAL  RESOURCES,  INC.,  ("Chaparral")  and  Barry W.
Spector ("Escrow Agent").

     IN CONSIDERATION of the mutual covenants and agreements  contained  herein,
the parties agree as follows:

         1.1.  This Escrow  Agreement is entered into to provide for the deposit
of earnest  money  required  under the terms of that  certain  Letter  Agreement
between  Shareholders  and  Chaparral  effective  January  4, 1996 (the  "Letter
Agreement").

         2.  Upon the  execution  hereof,  Chaparral  shall  deposit  the sum of
$300,000.00  U.S.,  ("Escrow  Funds") in escrow with Escrow Agent, to be held in
accordance  with the terms of this  Agreement.  Disbursement of the Escrow Funds
and delivery of the Resignations shall be in accordance with the following:

     (a)  Should  Escrow  Agent  receive  a  written  certificate  sworn  to  by
          Shareholders  stating  (i) that the Letter  Agreement  has  expired or
          otherwise  been  terminated,  (ii) that Chaparral is in default of its
          obligations  to  Close  thereunder,  and  (iii)  that a copy  of  such
          certificate  has been  delivered to  Chaparral,  then, if Escrow Agent
          does not receive a written  objection thereto from Chaparral within 15
          days following Escrow Agent's receipt of the certificate, Escrow Agent
          shall disburse the Escrow Funds to the Shareholders.

     (b)  Should  Escrow  Agent  receive a written  certificate  sworn to by the
          President  of  Chaparral  stating  (i) that the Letter  Agreement  has
          expired or otherwise  been  terminated,  (ii) that the  conditions  of
          Closing  thereunder  were not met or  satisfied by  Shareholders,  and
          (iii)  that  a  copy  of  such   certificate  has  been  delivered  to
          Shareholders,  then,  if  Escrow  Agent  does not  receive  a  written
          objection  thereto from  Shareholders  within 15 days following Escrow
          Agent's  receipt of the  certificate,  Escrow Agent shall disburse the
          Escrow Funds to Chaparral.

     (c)  Should  the Escrow  Agent  receive  joint  written  instructions  from
          Chaparral and  Shareholders  that Closing has  occurred,  Escrow Agent
          shall disburse the Escrow Funds to Shareholders.


<PAGE>

     (d)  Should Escrow Agent receive a timely,  written  objection,  concerning
          the certificates referred to in (a) and (b), above, Escrow Agent shall
          continue  to  hold  the  Escrow   Funds  until  it  receives   written
          instructions executed by both Shareholders and Chaparral,  or until it
          receives a valid court order affecting the Escrow Funds.

     3. In  consideration  of the acceptance of this escrow by the Escrow Agent,
the parties  agree to  indemnify  and hold the Escrow  Agent  harmless  from and
against any liability by it incurred to any other person or corporation  because
of its having accepted the deposits hereunder, or in connection herewith, and to
reimburse it for all its expenses,  including,  among other things, counsel fees
and court costs incurred in connection with this.

     4. The Escrow Agent is authorized  and directed to comply with and obey any
orders, judgments, or decrees of any court related to this Agreement, whether or
not in conformance with the instructions of the parties,  and in case the Escrow
Agent obeys or complies with any such order, judgment or decree of any court, it
shall not be liable to any of the parties hereto or to any other person, firm or
corporation due to such compliance.

     5. The Escrow Agent shall not be personally liable for any act it may do or
omit to do  hereunder  as Escrow  Agent while  acting in good faith,  and in the
exercise  of its own best  judgment in any act done or omitted by it pursuant to
the advice of its own attorney shall be conclusive evidence of that good faith.

     6. These  instructions  may be  altered,  amended,  modified  or revoked by
writing only,  signed by all of the parties  hereto,  and approved by the Escrow
Agent, upon payment of all fees, costs and expenses incident hereto.

     7. No assignment, transfer, conveyance or hypothecation of any right, title
or interest in and to the subject  matter of this Escrow  shall be binding  upon
the Escrow  Agent  unless  written  notice of it shall be served upon the Escrow
Agent and all fees,  costs and  expenses  incident to such  transfer of interest
shall have been paid.

     8. Any notice  required  or desired to be given by the Escrow  Agent to any
other party to this Escrow may be given by mailing the same to such party at the
address noted below, and notice so mailed shall, for all purposes hereof,  be as
effectual as though  served upon that party in person at the time of  depositing
that notice in the mail.

     9. The Escrow Agent shall have no duty to know or determine the performance
or  nonperformance  of any provision of any agreement  between the other parties
hereto,  and the  original or a copy of any such  agreement  deposited  with the
Escrow Agent shall not bind said Agent in any manner.  The Escrow Agent  assumes
no responsibility  for the validity or sufficiency of any documents or papers or
payments  deposited  or called for  hereunder,  except as may be  expressly  and
specifically set forth in these instructions.


<PAGE>

     10. In the event of any dispute with respect to the disposition of property
hereunder,  the Escrow Agent may, in its sole and absolute  discretion,  deposit
the property  described herein, or so much thereof as remains in its hands, with
any court of competent jurisdiction, and interplead the parties hereto; and upon
so depositing such property and filing its Complaint in  Interpleader,  it shall
be  relieved of all  liabilities  under the terms  hereof as to the  property so
deposited;  and, furthermore,  the parties hereto, for themselves,  their heirs,
legal representatives, successors and assigns do hereby submit themselves to the
jurisdiction  of said court,  and do hereby  appoint  the then Clerk,  or acting
Clerk of said Court as their Agent for the service of all process in  connection
with those  proceedings.  The institution of any such interpleader  action shall
not impair the rights of the Escrow Agent.

     11. The Escrow  Agent may  resign at any time by giving  written  notice by
Certified Mail,  Return Receipt  Requested,  to all of the parties hereto, to be
effective  thirty (30) days after that notice has been  deposited  into the U.S.
Mail. If a successor Agent has not been appointed  within thirty (30) days after
the giving of such notice of  resignation,  the Escrow  Agent may  petition  any
court of competent jurisdiction for the appointment of a successor Escrow Agent.

     12. Any notice  required or desired to be given by the Escrow  Agent to any
other  party to this  Escrow  Agreement  may be given by mailing to the  address
noted below.

     13. THE PARTIES  ACKNOWLEDGE  THAT THE ESCROW AGENT,  BARRY W. SPECTOR,  IS
COUNSEL FOR CHAPARRAL RESOURCES,  INC., AND THAT HE HAS REPRESENTED CHAPARRAL IN
CONNECTION  WITH THE  LETTER  AGREEMENT  AND  THIS  ESCROW  AGREEMENT,  AND WILL
CONTINUE TO REPRESENT  CHAPARRAL IN THOSE MATTERS.  THE PARTIES HERETO EXPRESSLY
CONSENT TO BARRY W. SPECTOR  CONTINUING  IN THOSE  CAPACITIES  AS WELL AS ESCROW
AGENT HEREUNDER.

     IN WITNESS  WHEREOF,  the parties have executed this  Agreement the day and
year first above written.

CHAPARRAL RESOURCES, INC.


/s/ Paul V. Hoovler
---------------------------
Paul V. Hoovler, President


<PAGE>



SHAREHOLDERS

/s/ Okan Ozdemir
------------------------------
Okan Ozdemir

/s/ Dursan Acikbas
------------------------------
Dursan Acikbas

/s/ Cetin Berkmen
------------------------------
Cetin Berkmen

/s/ Tugay Ince
------------------------------
Tugay Ince

/s/ Gazanger Ugural
------------------------------
Gazanger Ugural

/s/ Dursun Acikbas
------------------------------
Dursun Acikbas

ESCROW AGENT

/s/ Barry W. Spector
-----------------------------
Barry W. Spector, Escrow Agent