<PAGE>
                                                                   EXHIBIT 10.58
 
                          PURCHASE AND SALE AGREEMENT

This Purchase and Sale Agreement (this "Agreement") is made and entered into on
this the  22nd day of November, 1996, between AVIVA AMERICA, INC., a Delaware
corporation (Seller), and BWAB Incorporated, a Colorado corporation and/or its
permitted affiliates (Buyer).

1.   SALE AND PURCHASE OF THE PROPERTIES.   Subject to the terms and conditions
herein set forth, Seller agrees to sell, assign, convey and deliver to Buyer and
Buyer agrees to purchase and acquire from Seller at the Closing, but effective
as of 7:00 a.m. on October 1, 1996 (the Effective Date), the Properties.  The
term "Properties" shall mean:

          (a) All of Seller's right, title and interest in the oil and gas
     leases described in Exhibit B (the "Leases") and in the wells described in
                         ---------
     Exhibit A (the "Wells");
     ---------

          (b) All of Seller's right, title and interest in all wells, equipment,
     fixtures, production facilities, personal property and improvements
     (including, without limitation, materials, plants, pipelines, gathering and
     processing systems and salt water disposal systems) which are located on,
     appurtenant to or used in connection with the Leases and Wells now, as of
     the Effective Time or as of the Closing Date (the "Equipment");

          (c) All of Seller's right, title and interests in all contracts,
     instruments, payout balances, commitments, licenses, servitudes, permits,
     easements, rights-of-way and other rights of Seller relating to the items
     described in this Paragraph 1, together with all of Seller's rights, claims
     and causes of action under such items arising after the Effective Time (the
     "Contracts"), but specifically excluding all of Seller's rights, claims and
     causes of action under such items arising before the Effective Time,
     including, but not, limited to Seller's rights under the Williams Gas
     Contract Settlement (as described in the Offering Memorandum provided by
     Seller to Buyer);

          (d) All of Seller's right, title and interest in oil, gas, condensate,
     related hydrocarbons and other minerals produced from the Leases after the
     Effective Time (the "Substances"):

          (e) All accounts, instruments, general intangibles, liens and security
     interests arising from the sale or other disposition of the items described
     in this Paragraph 1 on or after the Effective Time (the "Accounts"); and

          (f) All of Seller's information relating to the Leases and the Wells,
     including geological, engineering, and proprietary geophysical and seismic
     data (both "2-D" and "3-D"), navigation tapes, logs, core analysis,
     formation tests, production records, land, title, accounting and contract
     files; but excluding materials which are subject to confidentiality
     agreements with third parties that prohibit sale or disclosure.

                                       1
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2.   PURCHASE PRICE.   The purchase price for the Properties shall be $3,000,000
(the "Purchase Price"), subject to any applicable adjustments as are hereinafter
provided.

3.   DEPOSIT.  Contemporaneously with the execution of this Agreement, Buyer
will deposit into an escrow account (to be established at a mutually acceptable
bank with assets in excess of $100 million), an amount equal to ten percent
(10%) of the Purchase Price (hereinafter called the "Deposit").  Buyer and
Seller agree that the escrow instructions shall specify that if Buyer and Seller
close the transaction contemplated by this Agreement, the Deposit shall be
applied to the Purchase Price and the amount due from Buyer at Closing will be
reduced, in addition to any other deductions provided for herein, by the amount
of the Deposit.  The Deposit shall be refunded to Buyer in the event that this
Agreement is terminated (a) because Buyer's conditions to Closing set out in
Paragraph 9 hereof are not satisfied and Buyer is not then in default under this
-----------                                                                     
Agreement or (b) pursuant to the provisions of Sections 8.3, 9.3, 17 or 19.6(d)
                                               ------------  ---  --    -------
hereof.  Otherwise, should Buyer fail or refuse to consummate the purchase of
the Properties hereunder, Seller shall be entitled to retain the Deposit as
liquidated damages as its sole and exclusive remedy (it being agreed that
damages in such event would be extremely difficult to determine and that the
Deposit represents a fair and reasonable estimate of damages under such
circumstances and does not constitute a penalty).  In the event that this
Agreement is terminated under conditions which entitle Buyer to a return of the
Deposit, the Deposit shall be returned to Buyer within ten (10) days of such
termination.

4.   ADJUSTMENTS TO PURCHASE PRICE; FINAL PURCHASE PRICE.  The Purchase Price
shall be adjusted as follows and the resulting amount shall be referred to
herein as the Final Purchase Price:

     4.1  INCREASES IN PURCHASE PRICE.  The Purchase Price shall be increased
by an amount equal to the sum of the following amounts:

          4.1.1 The amount of costs and expenses, including, without limitation,
     such capital expenditures as are permitted by Section 7.1.1. below incurred
                                                   --------------
     by Seller in the ordinary course of Seller's business and customary
     overhead charges related to the Properties from the Effective Date to the
     Closing Date; provided, however, Seller has agreed to bear and pay all
     costs associated with the workover of the Miami Corp. A-3 Well in Cameron
     Parish, Louisiana and such costs shall not result in an adjustment to the
     Purchase Price under this Section 4.1.
                               ----------- 

          4.1.2 The amount of all prepaid expenses, including, without
     limitation. ad valorem, property and similar taxes and assessments based
     upon or measured by ownership of the Properties and attributable to periods
     of time after the Effective Date.

          4.1.3 In the event that there is a cumulative net underproduction
     imbalance attributable to Seller's working interest in the Properties as of
     the Effective Date, an amount equal to the product of (a) the Imbalance
     Unit Value (as hereinafter defined) and (b) the volume (stated in Mcf's) of
     such cumulative net underproduction imbalance attributable to Seller's
     working interest in the Properties as of the Effective Date. The "Imbalance
     Unit Value" shall mean a per Mcf value for imbalances to be agreed upon
     between Seller and

                                       2
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     Buyer prior to Closing (or determined pursuant to Paragraph 33 hereof if
                                                       ------------
     Seller and Buyer are unable to reach an agreement).

          4.1.4 As to Wells in which Seller's Net Revenue Interest (as defined
     in Section 10 below) is determined to be greater than the decimal interest
        ----------
     noted in Exhibit A, an amount determined by multiplying the Allocated Value
              ---------
     (as hereinafter defined) for Seller's interest in the Well in question by a
     fraction, the numerator of which shall be the decimal increase in Seller's
     Net Revenue Interest in such Well from the interest shown for such Well in
     Exhibit A and the denominator of which shall be the Net Revenue Interest
     ---------
     shown for such Well on such Exhibit.
 
          4.1.5 The value of all merchantable oil and other products in tanks
     above the pipeline sales connection at the Effective Date that is credited
     to the Properties, such value to be the market or, if applicable, the
     contract price in effect as of the Effective Date, less any applicable
     severance taxes and royalties.
 
     4.2  DECREASES IN PURCHASE PRICE.  The Purchase Price shall be decreased by
an amount equal to the sum of the following amounts:
 
          4.2.1 The amount of all proceeds received by Seller, net of all
     applicable taxes and royalties attributable to production from the
     Properties for periods of time after the Effective Date.
 
          4.2.2 In the event that there is a cumulative net overproduction
     imbalance attributable to Seller's working interest in the Properties as of
     the Effective Date, an amount equal to the product of (a) the Imbalance
     Unit Value and (b) the volume (stated in Mcf's) of such cumulative net
     overproduction imbalance attributable to Seller's working interest in the
     Properties as of the Effective Date.

          4.2.3 An amount equal to all ad valorem, property, and similar taxes
     and assessments based upon or measured by Seller's ownership of the
     Properties that are unpaid as of the Closing Date and attributable to
     periods of time prior to the Effective Date (for which Buyer agrees to
     assume liability hereunder), which amounts shall be computed based upon
     such taxes and assessments for the calendar year 1996; provided that if
     such taxes or assessments are assessed on other than a calendar year basis,
     for the tax related year last ended.

          4.2.4 Any amount determined in connection with uncured Title Defects
     as provided for in Section 10.4 below.
                        ------------       

          4.2.5  Any amount determined in connection with any Casualty Loss as
     provided for in Section 17 below.
                     ----------       

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          4.2.6  Any amount determined in connection with Adverse Environmental
     Conditions as provided for in Section 19.6(b) and/or (c) below.
                                   ---------------        ---

          4.2.7  Any amount determined in connection with an Accounting Defect
     as provided for in Section 10.8 below.
                        ------------       

     4.3.  GAS IMBALANCES.  The adjustments to be made to the Purchase Price at
Closing based upon the net cumulative gas imbalances attributable to Seller's
working interest in the Properties shall be made based upon the gas imbalance
schedule attached hereto as Schedule 4.3.  Buyer and Seller shall have a period
                            ------------                                       
of six (6) months following the date of Closing to verify the accuracy of
Schedule 4.3.  Buyer and Seller agree to cooperate with each other following
------------                                                                
Closing to determine the accuracy of Schedule 4.3 and to determine what
                                     ------------                      
adjustments, if any,  are required to make to Schedule 4.3 in order to make
                                              ------------                 
Schedule 4.3 accurate.   Within ten (10) days following the end of such six (6)
------------                                                                   
month time period, Buyer shall deliver to Seller a written statement (Buyer's
Gas Balancing Statement) setting out any adjustments Buyer proposes to be made
to Schedule 4.3 along with such supporting documentation as may be required to
   ------------                                                               
verify any changes Buyer is proposing be made. Within five (5) days of Seller's
receipt of Buyer's Gas Balancing Statement, Seller shall advise Buyer in writing
whether Seller agrees with Buyer's Gas Balancing Statement and, if not, what
changes Seller proposes be made to Buyer's Gas Balancing Statement.  The parties
shall thereafter undertake to agree with respect to the adjustments, if any,
which are required to be made to Schedule 4.3 at the earliest practical date.
                                 ------------                                
Any final amounts owed by either party to the other as a result of any changes
to Schedule 4.3 shall be paid in immediately available funds within five (5)
   ------------                                                             
days of the date the parties reach a final agreement with respect to Schedule
                                                                     --------
4.3.
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5.   REPRESENTATIONS AND WARRANTIES OF SELLER.   Seller represents and warrants
to Buyer that:

     5.1  ORGANIZATION. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
qualified to do business in and in good standing under the laws of the state(s)
where the Properties are located.
 
     5.2  AUTHORITY.  Seller has full power and authority and has taken all
requisite action, corporate or otherwise, to authorize it to carry on its
business as currently conducted, to enter into this Agreement and to perform its
obligations under this Agreement.
 
     5.3  ENFORCEABILITY.  This Agreement has been duly executed and delivered
on behalf of Seller and constitutes the legal, valid and binding obligation of
Seller enforceable in accordance with its terms. At the Closing, all documents
required hereunder to be executed and delivered by Seller shall be duly
authorized, executed and delivered and shall constitute legal, valid and binding
obligations of Seller enforceable in accordance with their respective terms.
 
     5.4  CONTRACTS.  All material leases, operating agreements, production
sales contracts, farmout agreements and other material contracts or agreements
respecting the Properties can be found either of record in the counties in which
the Properties are located or are reflected or referenced in Seller's files.

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<PAGE>
 
     5.5   PREFERENTIAL PURCHASE RIGHTS/CONSENTS.  Schedule 5.5 sets forth all
                                                   ------------               
consents and approvals required to be obtained for, and all preferential
purchase rights exercisable in connection with, the assignment of the Properties
to Buyer, except for those constituting Permitted Encumbrances.
 
     5.6   LITIGATION AND CLAIMS.  Except as set forth in Schedule 5.6, no
                                                          ------------
claim, filing, cause of action, administrative proceeding, lawsuit or other
litigation is pending or threatened in writing that could reasonably be expected
to now or hereafter materially and adversely affect Buyer's ownership, operation
or value of any of the Properties.

     5.7   NO MATERIAL DEFAULT.  Seller is not in material default under any of
the contracts or agreements referred to in Section 5.4.

     5.8   PROPERTY OBLIGATIONS.  To the best of Seller's knowledge, all
rentals, royalties, shut-in royalties, overriding royalties and other payments
due pursuant to ro with respect to the Leases have been properly paid.

     5.9   PROPERTY OPERATION.  To the best of Seller's knowledge: (i) the
Properties have been drilled, completed, operated, developed and produced in
material compliance with all applicable judgments, orders, laws, rules and
regulations; and (ii) all necessary certificates, consents, permits, licenses
and other governmental authorizations affecting the Properties have been
obtained and are in force.

     5.10  TAKE-OR PAY.  Seller is not obligated, under a take-or-pay or similar
arrangement, or by virtue of an election to non-consent, or not participate in a
past or current operation on the Properties pursuant to the applicable operating
agreements, to produce hydrocarbons, or allow hydrocarbons to be produced,
without receiving full payment at the time of delivery in an amount that
corresponds to the net revenue interest in the hydrocarbons described on
Exhibit A.
--------- 

     5.11  TAXES.  All taxes based on or measured by the ownership of property,
the production or removal of hydrocarbons and the receipt of proceeds which are
due and relating to the Properties have been properly paid, subject to possible
adjustment for volume or price corrections.

     5.12  TIMELY PAYMENT.  Seller is timely receiving its share of proceeds
from the sale of hydrocarbons produced from the Properties without suspense,
counterclaim or set-off, except for immaterial amounts. To the best of Seller's
knowledge, there has been no production of hydrocarbons from the Properties in
excess of the allowable production established pursuant to applicable state or
federal law or regulation that would result in a restriction on production from
the Leases subsequent to the Effective Time.

     5.13  PROPERTY CONDITION.  To the best of Seller's knowledge, there has
been no material adverse change in the condition of any of the Properties or
Equipment after the Effective Date except depletion through normal production
within authorized allowables, changes in rates of production that 

                                       5
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occur in the ordinary course of operation and depreciation of Equipment through
ordinary wear and tear.

     5.14  BROKERS' FEES.  Seller has incurred no liability for brokers' fees or
finders' fees, including the fees of Wellspring Partners, related to the
transactions contemplated by this Agreement for which Buyer shall be liable.

     5.15  OUTSTANDING OBLIGATIONS.  Except as otherwise described in Schedule
                                                                      --------
5.15 hereof, to the best of Seller's knowledge there are no outstanding
----                                                                   
authorizations for expenditures or any written commitments or proposals to
conduct operations on the Properties which are required to be approved by non-
operators under the terms of the applicable operating agreement.

     5.16  COMPLIANCE.  To the best of Seller's knowledge, the Properties have
been operated in material compliance with all applicable laws, regulations,
orders, judgments, licenses and permits concerning the prevention, abatement or
elimination of pollution and the protection of the environment and there is no
circumstance which could reasonably be expected to (i) materially interfere with
continued compliance, (ii) give rise to material liability, (iii) form the basis
for any material claim, suit, relief or investigation, or (iv) require a
material change in the present condition or operation of the Properties.

6.   REPRESENTATIONS AND WARRANTIES OF BUYER.   Buyer represents and warrants to
Seller that:

     6.1  ORGANIZATION.  Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Colorado and is qualified
(or will be qualified at the time of Closing) to do business in and in good
standing under the laws of the state(s) where the Properties are located.

     6.2  AUTHORITY.  Buyer has full power and authority and has taken all
requisite action, corporate or otherwise, to enter into this Agreement, to
purchase the Properties on the terms described in this Agreement and to perform
its other obligations under this Agreement.

     6.3  ENFORCEABILITY.  This Agreement has been duly executed and delivered
on behalf of Buyer, and constitutes the legal, valid and binding obligation of
Buyer enforceable in accordance with its terms. At the Closing, all documents
required hereunder to be executed and delivered by Buyer shall be duly
authorized, executed and delivered and shall constitute legal, valid and binding
obligations of Buyer enforceable in accordance with their respective terms.

     6.4  DUE DILIGENCE.  Buyer represents that it has performed, or will
perform before Closing, necessary evaluations and assessments relating to the
Properties to enable it to make an independent determination with respect to its
acquisition of the Properties under the terms of this Agreement.

     6.5  INVESTMENT INTENT.  Buyer is a knowledgeable purchaser, owner, and
operator of oil and gas properties, has the ability to evaluate (and in fact has
evaluated) the Properties for purchase 

                                       6
<PAGE>
 
and is acquiring the Properties for its own account and not with the intent to
make a distribution thereof in violation of the Securities Act of 1933 as
amended (and the rules and regulations pertaining thereto), or in violation of
any other applicable securities laws.

     6.6  FUNDS AVAILABLE.  Buyer has, or will have (based upon its current
creditworthiness) prior to the Closing Date, sufficient cash, available lines of
credit or other sources of immediately available funds to enable it to make
payment of the Purchase Price.

     6.7  BROKERS FEES.  Buyer has incurred no liability for brokers' fees or
finders' fees related to the transactions contemplated by this Agreement for
which Seller shall be liable.

7.   COVENANTS OF SELLER.

     7.1  CONDUCT OF BUSINESS PENDING CLOSING.  Seller covenants that from the
date hereof to the Closing Date, except (a) as provided herein, (b) as required
by any existing obligation, agreement, lease, contract, or instrument to which
the Properties are subject, or (c) as otherwise consented to in writing by
Buyer, Seller will:
 
          7.1.1 Not (a) act in any manner with respect to the Properties other
     than in the normal, usual and customary manner, consistent with prior
     practice; (b) dispose of, encumber or relinquish any of the Properties
     (other than relinquishments resulting from the expiration of leases that
     Seller has no contractual right or option to renew); (c) waive, compromise
     or settle any material right or claim with respect to any of the
     Properties; or (d) conduct capital or workover projects with respect to the
     Properties in excess of $10,000.00, except when required by an emergency
     when there shall have been insufficient time to obtain advance consent.

          7.1.2  Use its best efforts to preserve relationships with all third
     parties having business dealings with respect to the Properties.

          7.1.3  Cooperate with Buyer in connection with any required
     notification of applicable governmental regulatory authorities of the
     transactions contemplated hereby and cooperate with Buyer in obtaining the
     issuance by each such authority of such permits, licenses and
     authorizations as may be necessary for Buyer to own and operate the
     Properties following the consummation of the transactions contemplated by
     this Agreement.

          7.1.4  Notify Buyer of the discovery by Seller that any Representation
     or Warranty of Seller contained in this Agreement is or becomes materially
     untrue or will be materially untrue on the Closing Date.

     7.2  ACCESS.  Seller shall afford to Buyer and its authorized
representatives reasonable access, at Buyer's sole risk and expense, from the
date hereof until the Closing Date during normal business hours, to (a) the
Properties operated by Seller, provided, however, that Buyer shall indemnify and
hold harmless Seller and its co-owners, and their respective officers, directors
and 

                                       7
<PAGE>
 
employees from and against any and all losses, costs, damages, obligations,
claims, liabilities, expenses and causes of action arising from Buyer's
inspection of the Properties. including, without limitation, claims for personal
injuries, property damage and reasonable attorneys' fees, and (b) Seller's
operating, accounting, contract, legal files, and records, regarding the
Properties ("Data"); provided, however, that Data shall not include (a) any
attorney work product or attorney client communications which Seller reasonably
believes to be privileged or  (b) information, the disclosure of which would
violate any confidentiality agreement to which Seller is bound; provided that
Seller agrees to disclose sufficient information about any such confidentiality
agreements to enable Buyer to request waivers of the same to enable it to
conduct its due diligence reviews.  Until Closing, Buyer shall exercise
reasonable care in safeguarding and maintaining the confidentiality of all data
or information regarding the Properties provided by Seller to Buyer.  In the
event this Agreement is terminated prior to Closing, Buyer will immediately
return to Seller all copies of such data or information and shall continue to
maintain the confidentiality of all information regarding the Properties
provided by Seller to Buyer for a period of twelve (12) months from the date of
such termination.

     7.3  CONSENTS; APPROVALS.  Seller will cooperate with Buyer and take all
action reasonably necessary to attempt to obtain all permissions, approvals and
consents as may be required to consummate the transactions contemplated in this
Agreement, including, but not limited to, obtaining waivers of any required
consents to transfer and preferential rights to purchase set out in Schedule 5.5
                                                                    ------------
hereto.

8.   CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER.  The obligations of
Seller to be performed at Closing are subject to the fulfillment (or waiver by
Seller in its sole discretion) before or at Closing, of each of the following
conditions:

     8.1  REPRESENTATIONS AND WARRANTIES.   The Representations and Warranties
by Buyer set forth in this Agreement shall be true and correct in all material
respects at and as of the Closing as though made at and as of the Closing; and
Buyer shall have performed and complied with, in all material respects, all
covenants and agreements required to be performed and satisfied by Buyer at or
prior to the Closing.

     8.2  NO LITIGATION.   No suit, action or other proceedings shall, on the
date of Closing, be pending or threatened before any court or governmental
agency seeking to restrain, prohibit, or obtain substantial damages or other
material adverse relief in connection with the consummation of the transactions
contemplated by this Agreement.

     8.3  TITLE DEFECTS/ACCOUNTING DEFECTS/CASUALTY LOSSES/ADVERSE ENVIRONMENTAL
CONDITIONS.  The total of the Purchase Price reductions (if any) which result
from the application of Section 10.4, Section 10.8, Section 17 or Section 19.6
                        ------------  ------------  ----------    ------------
hereof do not exceed ten percent (10%) of the Purchase Price.

                                       8
<PAGE>
 
     If any such condition to the obligations of Seller to be performed at
Closing under this Agreement is not met as of the Closing Date, this Agreement
may, at the option of Seller, be terminated.

9.   CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER. The obligations of Buyer
to be performed at Closing are subject to the fulfillment (or waiver by Buyer in
its sole discretion) before or at Closing, of each of the following conditions:

     9.1  REPRESENTATIONS AND WARRANTIES.   The Representations and Warranties
by Seller set forth in this Agreement shall be true and correct in all material
respects at and as of the Closing as though made at and as of the Closing; and
Seller shall have performed and complied with, in all material respects, all
covenants and agreements required to be performed and satisfied by Seller at or
prior to the Closing.

     9.2  NO LITIGATION.   No suit, action or other proceedings shall, on the
date of Closing, be pending or threatened before any court or governmental
agency seeking to restrain, prohibit, or obtain substantial damages or other
material adverse relief in connection with the consummation of the transactions
contemplated by this Agreement.

     9.3  TITLE DEFECTS/ACCOUNTING DEFECTS/CASUALTY LOSSES/ADVERSE ENVIRONMENTAL
CONDITIONS.  The total of the Purchase Price reductions (if any) which result
from the application of Section 10.4, Section 10.8,  Section 17 or Section 19.6
                        ------------  ------------   ----------    ------------
hereof do not exceed ten percent (10%) of the Purchase Price.

     If any such condition to the obligations of Buyer under this Agreement is
not met as of the Closing Date, this Agreement may, at the option of Buyer, be
terminated.

10.  TITLE MATTERS/ACCOUNTING DEFECTS.

     10.1 CERTAIN DEFINED TERMS.   As used in this Agreement, the following
terms have the following meanings:

          10.1.1 "Good and Defensible Title" means such title to the Properties
     that (a) entitles Seller to receive not less than the Net Revenue Interests
     in all oil, gas, condensate and related hydrocarbons produced from the
     Wells described in Exhibit A, and (b) obligates Seller to bear not more
                        ---------
     than the Working Interests in the Wells as set forth in Exhibit A (unless
                                                             ---------
     there is a corresponding increase in the Net Revenue Interests) and (ii) is
     free and clear of all liens and encumbrances, except for Permitted
     Encumbrances.

          10.1.2 "Title Defect" shall mean, with respect to Seller's title to
     the Properties, any lien, mortgage, claim, charge, defect, or other
     encumbrance which renders Seller's title to such Properties less than Good
     and Defensible Title.

                                       9
<PAGE>
 
          10.1.3 "Net Revenue Interest" shall mean Seller's interest in and to
     all production of oil, gas and other minerals saved, produced and sold from
     any Well after giving effect to all valid lessor's royalties, overriding
     royalties, production payments, carried interests, and other burdens on
     production therefrom.

          10.1.4 "Working Interest" shall mean, with respect to the Wells,
     Seller's share of the cost of exploring, drilling, developing and operating
     the Wells, and producing oil, gas and other minerals.

          10.1.5 "Permitted Encumbrances" shall mean:

                 (a) Lessors' royalties, overriding royalties, reversionary
          interests and similar burdens if the net cumulative effect of the
          burdens does not operate to reduce Seller's Net Revenue Interest in a
          Well to less than the Net Revenue Interest for such Well set forth in
          Exhibit A or operate to increase Seller's Working Interest in such
          ---------                                
          Well to more than the Working Interest for such Well set forth in
          Exhibit A;
          --------- 

                 (b) Division orders and sales contracts terminable without
          penalty upon no more than 90 days notice to the purchaser;

                 (c) Preferential rights to purchase and required third party
          consents to assignment and similar agreements with respect to which
          waivers or consents are obtained from the appropriate parties, or the
          appropriate time period for asserting any such right has expired
          without an exercise of the right;

                 (d) Materialman's, mechanic's, repairman's, employee's,
          contractor's, operator's, tax, and other similar liens or charges
          arising in the ordinary course of business for obligations that are
          not delinquent or that will be paid and discharged in the ordinary
          course of business or if delinquent, that are being contested in good
          faith by appropriate action of which Buyer is notified in writing
          before Closing;

                 (e) All rights to consent by, required notices to, filings
          with, or other actions by governmental entities in connection with the
          sale or conveyance of oil and gas leases or interests therein if they
          are routinely obtained subsequent to the sale or conveyance;

                 (f) Easements, rights-of-way, servitudes, permits, surface
          leases and other rights in respect of surface operations that do not
          materially interfere with the oil and gas operations to be conducted
          on any Well or Lease;

                 (g) All operating agreements, unit agreements, unit operating
          agreements, pooling agreements and pooling designations affecting the
          Properties that are either of record in Seller's chain of title or
          reflected or referenced in Seller's files and which do not reduce the
          interest of Seller with respect to oil and gas produced from any 

                                       10
<PAGE>
 
          Well below the Net Revenue Interest set forth in Exhibit "A" for such
          Well; or increase Seller's Working Interest in such Well to more than
          the Working Interest set forth in Exhibit "A" for such Well (unless
          there is a corresponding increase in the Net Revenue Interest);

                 (h) Conventional rights of reassignment prior to release or
          surrender requiring notice to the holders of the rights;

                 (i) All rights reserved to or vested in any governmental,
          statutory or public authority to control or regulate any of the
          Properties in any manner, and all applicable laws, rules and orders of
          governmental authority;

                 (j) The terms and conditions of the Leases, and of all
          agreements that are of record in Seller's chain of title or reflected
          or referenced in Seller's files.

                 (k) All other liens, charges, encumbrances, contracts,
          agreements, instruments, obligations, defects and irregularities
          affecting the Properties which individually or in the aggregate are
          not such as to interfere materially with the operation, value or use
          of any of the Properties, do not prevent Buyer from receiving the
          proceeds of production from any of the Wells, do not reduce the
          interest of Seller with respect to all oil and gas produced from any
          Well below the Net Revenue Interest set forth in Exhibit A for such
                                                           ----------
          Well or increase Seller's Working Interest in any such Well to more
          than the Working Interest set forth in Exhibit A for such well; and
                                                 ---------                   

                 (l) Any Title Defects Buyer may have expressly waived in
          writing or which are deemed to have become Permitted Encumbrances
          under Section 10.2.
                ------------- 

          10.1.6 "Defect Property" shall mean any Property which is subject to a
     Title Defect.

          10.1.7 "Defect Value" shall mean the amount by which the Allocated
     Value of any Well is reduced as a result of a Title Defect.

          10.1.8 The "Allocated Value" of a Well shall be determined first by
     reference to the portion of the Purchase Price which is allocated to 
     the Properties in the State in which said Well is located as set out in
     Exhibit C hereto, and second, by the relative value of said Well in
     ---------
     relation to the aggregate value of all Wells located in said State, as
     determined reservoir engineering reports.

          10.1.9 "Required Consent" means any approvals, consents or waiver of
     preferential rights to purchase, other than Permitted Encumbrances,
     required to be obtained in connection with the conveyance of the Properties
     to Buyer at Closing.

                                       11
<PAGE>
 
          10.1.10  An "Accounting Defect" shall be deemed to have occurred if
     Seller's joint interest billings and/or revenue check details for the
     Properties for the twelve (12) months prior to the Effective Date or any
     gas contracts or processing agreements covering the Properties reflect that
     the actual costs of operating the Properties or the revenues generated from
     the sale of oil or gas from the Properties are different in any material
     respect from those set out in the reserve report delivered by Seller to
     Buyer, and such differences, if incorporated in the reserve report would
     result in reducing the future net revenues from the Properties.

     10.2 NOTICE OF TITLE DEFECTS.  In the event that Buyer shall identify any
Title Defect, as soon as possible after discovery, but in no event later than
ten (10) days prior to the Closing Date, Buyer shall notify Seller in writing of
any Title Defect.  Buyer's notice (a "Defect Notice") shall include (i) a
description of the Property affected by the Title Defect; (ii) a reasonably
adequate explanation of the basis for the Title Defect; and (iii) the amount by
which Buyer believes the value of the affected Property has been reduced by the
Title Defect.  Buyer's failure to give notice of a Title Defect within the time
required by this Section 10.2 shall be a waiver by Buyer of such Title Defect
                 ------------                                                
and such Title Defect shall be treated as a Permitted Encumbrance.

     10.3 REMEDIES FOR TITLE DEFECT.  Upon notice of a Title Defect, Seller
shall have the right, but not the obligation, until Closing, to cure the Title
Defect.  If Seller is unable or elects not to cure the Title Defect prior to
Closing, the Purchase Price shall be reduced pursuant to Section 10.4.

     10.4 VALUE OF TITLE DEFECTS.  If Seller is unable or elects not to cure a
Title Defect prior to Closing, the parties shall promptly meet and negotiate in
good faith to reach an agreement as to the value of each such Title Defect.  If
the parties reach an agreement as to the value of a Title Defect, then the
amount agreed upon shall be the Defect Value for such Title Defect.  If the
parties' negotiations fail to result in an agreement as to the value of any
Title Defect prior to Closing (or thereafter as the parties may agree), then the
question as to the value of the Title Defect shall be submitted to arbitration
in accordance with Section 33 of this Agreement; provided, however, that for
                   ----------                                               
purposes of Closing and Sections 8.3 and 9.3 hereof, an  amount equal to the
                        ------------     ---                                
average of Seller's and Buyer's estimate of the value of the Title Defect shall
apply unless Seller has failed to provide an estimate, in which event Buyer's
estimate of the value of the Title Defect shall apply; provided further, that
the value of a Title Defect affecting a Well shall never be in excess of the
Allocated Value of such Well.  Accordingly, at Closing the Purchase Price shall
be adjusted based on an estimate (determined as aforesaid) and the difference
between the estimated value of such Title Defect used for Closing and the final
value of the Title Defect, as decided by arbitration, shall be a post-Closing
adjustment item to be made pursuant to Section 13.1 hereof.
                                       ------------        

     10.5 CONVEYANCE OF DEFECT PROPERTIES.  If, at Closing, Title Defects with
respect to any Defect Properties have not been corrected by Seller or waived by
Buyer, then subject to the provisions of Sections 8.3 and 9.3 hereof, the
                                         ------------     ---            
Purchase Price shall be reduced by the value of such Title Defects and Seller
shall convey to Buyer those Defect Properties subject to partial title failures,
but Seller shall not be obligated to convey to Buyer any Defect Properties with
respect to which there has been complete title failure.

                                       12
<PAGE>
 
     10.6  ADDITIONAL DEFECT PROPERTIES.  If any Required Consent is not
obtained prior to Closing, Buyer may elect to treat that portion of the
Properties subject to such Required Consent as a Defect Property by giving
Seller notice thereof in accordance with the provisions of Section 10.2.
                                                           ------------ 

     10.7  NOTICE OF ACCOUNTING DEFECTS.  In the event that Buyer shall identify
any Accounting Defects, as soon as possible after discovery, but in no event
later than ten (10) days prior to the Closing Date, Buyer shall notify Seller in
writing of any Accounting Defect.  Buyer's notice shall include (i) a
description of the costs or revenues which Buyer believes were not properly
reflected in the reserve report, (ii) a reasonably adequate explanation of the
basis for the Accounting Defect, and (iii) the amount by which Buyer believes
the value of the Properties have been reduced by the Accounting Defect.  Buyer's
failure to give notice of an Accounting Defect within the time required by this
Section 10.7 shall be a waiver by Buyer of such Accounting Defect.
------------                                                      

     10.8  VALUE OF ACCOUNTING DEFECT.  The parties shall promptly meet and
negotiate in good faith to reach an agreement as to the value of each Accounting
Defect.  If the parties reach an agreement as to the value of an Accounting
Defect, then the Purchase Price shall be reduced by the amount agreed upon.  If
the parties negotiations fail to result in an agreement as to the value of any
Accounting Defect prior to Closing (or thereafter as the parties may agree),
then the value of the Accounting Defect shall be submitted to arbitration in
accordance with Section 33 of this Agreement; provided, however, that for
                ----------                                               
purposes of Closing and Sections 8.3 and 9.3 hereof, an amount equal to the
                        ------------     ---                               
average of Seller's and Buyer's estimate of the value of the Accounting Defect
shall apply unless Seller has failed to provide an estimate, in which event
Buyer's estimate of the value of the Accounting Defect shall apply.
Accordingly, at Closing the Purchase Price shall be adjusted based on an
estimate (determined as aforesaid) and the difference between the estimated
value of such Accounting Defect used for Closing and the final value of the
Accounting Defect, as decided by arbitration, shall be a post-Closing adjustment
item to be made pursuant of Section 13.1 hereof.
                            ------------        

11.  SUSPENSE FUNDS HELD BY SELLER.   Seller agrees to convey and Buyer agrees
to receive all suspense funds held by Seller as of the Effective Date for the
benefit of royalty, overriding royalty interest and working interest owners
attributable to the Properties, the amount of such funds to be adjusted with
respect to suspense funds received and disbursed by Seller from and after the
Effective Date, and Buyer shall assume all past, present and future liability
associated with such funds, but only as to the suspense funds actually
transferred, and not to any liability resulting from Seller's failure to pay or
retain any amounts prior to the Effective Date. All past, present and future
liability associated with such funds shall be assumed by Buyer and Buyer agrees
to protect, defend, indemnify and hold Seller and its employees harmless from
and against any and all costs, expenses, claims, demands, and causes of action
of every kind and character (including attorneys' fees and court costs) arising
out of, incident to, or in connection therewith.

12.  CLOSING.

     12.1  THE CLOSING.  The sale and purchase of the Properties pursuant to
this Agreement shall be consummated (the "Closing") in the offices of Seller on
or before December 23, 1996 (the "Closing Date").

                                       13
<PAGE>
 
12.2  CLOSING OBLIGATIONS.  At the Closing, the following events shall occur:
 
          12.2.1 Seller shall execute and deliver to Buyer one or more
      instruments of assignment, in substantially the form of the Assignment,
      Bill of Sale and Conveyance set forth as Exhibit D hereto.
                                               ---------        

          12.2.2 Buyer shall deliver to Seller in immediately available funds
      (wire transfer), the Preliminary Amount. The "Preliminary Amount" shall be
      that amount to be determined by Seller prior to the Closing Date as an
      estimate of the final computation of the Final Purchase Price. Seller
      shall provide Buyer a closing statement reflecting the Preliminary Amount
      at least two (2) business days prior to the Closing.

          12.2.3 Seller and Buyer shall execute, acknowledge and deliver
      division orders, transfer orders or letters in lieu thereof directing all
      purchasers of production from the Properties to make payment of proceeds
      attributable to such production occurring on or after the Effective Date
      to Buyer.

          12.2.4 Seller shall deliver to the Buyer possession of the Properties
      at the Closing.

13.   POST-CLOSING ADJUSTMENTS.

      13.1  FINAL SETTLEMENT STATEMENT. After the Closing Date, Seller shall
prepare, in accordance with this Agreement and with generally accepted
accounting principles consistently applied, a Final Settlement Statement, a copy
of which shall be delivered by Seller to Buyer no later than ninety (90) days
after the Closing Date. The "Final Settlement Statement" shall set forth each
adjustment to the Purchase Price necessary to determine the Final Purchase Price
(except those adjustments to be made pursuant to the provisions of Section 4.3
                                                                   -----------
hereof) and show the calculation of such adjustments in accordance with Section
                                                                        -------
4. The parties shall undertake to agree on the Final Settlement Statement and
-                                                                            
the Final Purchase Price no later than one hundred twenty (120) days after the
Closing Date.

      13.2  ARBITRATION.   If Seller and Buyer cannot agree upon the Final
Settlement Statement, then the disputed matters shall be submitted to
arbitration pursuant to the provisions of Section 33 hereof.
                                          ----------        

      13.3  PAYMENT OF FINAL PURCHASE PRICE.  If the Final Purchase Price is
more than the Preliminary Amount, Buyer shall pay such difference to Seller in
immediately available funds within five (5) days after the parties have agreed
upon the Final Settlement Statement. If the Final Purchase Price is less than
the Preliminary Amount, Seller shall pay such difference to Buyer in immediately
available funds within five (5) days after the parties have agreed upon the
Final Settlement Statement.

14.   ASSUMPTION OF CERTAIN OBLIGATIONS.   Except as provided for in Section
                                                                     -------
19.6(a), at Closing, Buyer shall assume all costs and liabilities and discharge
-------                                                                        
all obligations of Seller (a) under all leases, operating agreements, production
sales contracts, farmout agreements and other contracts or 

                                       14
<PAGE>
 
agreements respecting the Properties or relating the ownership or operation of
the Properties from and after the Effective Date, and (b) with respect to all
imbalances associated with the Properties, regardless of their nature or of the
time at which they accrued.

15.  LIMITATION OF WARRANTIES. Anything in this Agreement to the contrary
notwithstanding, the Properties are being sold by Seller to Buyer without
recourse, covenant, or warranty of any kind; express, implied, or statutory,
with the sole exception that Seller will warrant title to the Properties subject
to the Permitted Encumbrances, against every person whomsoever lawfully claiming
or to claim the same or any part thereof by, through, or under Seller, but not
otherwise.  WITHOUT LIMITATION OF THE GENERALITY OF THE IMMEDIATELY PRECEDING
SENTENCE, SELLER WILL CONVEY THE PROPERTIES AS-IS, WHERE-IS AND WITH ALL FAULTS,
AND EXPRESSLY DISCLAIMS AND NEGATES (a) ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, (b) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, AND (c) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR
SAMPLES OF MATERIALS.  The representations and warranties made by Seller and
Buyer in Sections 5 and 6 shall survive Closing for a period of six (6) months
         ----------     -                                                     
and shall thereafter be of no further force and effect, excepting only matters
as to which a written claim has been made prior to the end of such six (6) month
time period.

16.  CROSS-INDEMNIFICATION.   Except as expressly limited elsewhere in this
Agreement, in the event that Closing occurs hereunder:

          (a) Buyer agrees to indemnify and hold Seller harmless from and
     against any and all liability, loss, cost and expense (including, without
     limitation, court costs and reasonable attorneys' fees) that are
     attributable to the Properties conveyed to Buyer and are attributable to
     periods of time on or after the Effective Date; and

          (b) Subject to the provisions of Section 19 hereof, Seller agrees to
                                           ----------                         
     indemnify and hold Buyer harmless from and against any and all liability,
     loss, cost and expense (including, without limitation, court costs and
     reasonable attorneys' fees) that are attributable to the Properties
     conveyed to Buyer and are attributable to periods of time before the
     Effective Date;

          (c) The respective indemnity and hold harmless obligations of the
     parties hereto shall not apply to:

               (i) any amount that was taken into account as an upward or
          downward adjustment to the Final Purchase Price pursuant to the
          provisions hereof, but only to the extent of such adjustments,

               (ii) any liability of one Party hereto to any other Party under
          the provisions of this Agreement, or

                                       15
<PAGE>
 
               (iii) each Party's costs and expenses with respect to the
          negotiation and consummation of this Agreement and the purchase and
          sale of the Properties.

17.  CASUALTY LOSS.   Prior to Closing, Seller shall promptly notify Buyer of
any Casualty Loss of which Seller becomes aware. "Casualty Loss" shall mean,
with respect to all or any material portion of a Property, any destruction by
fire, blowout or other casualty (above or below the ground) or any taking, or
pending or threatened taking, in condemnation or under the right to eminent
domain of any Property or portion thereof. If any Casualty Loss occurs, Buyer
may elect to (a) cause Seller to retain the Property affected by the Casualty
Loss, and to reduce the Purchase Price by the Allocated Value of the Property,
in which case Seller shall retain all insurance proceeds relating to the
Casualty Loss, or (b) require Seller to (i) transfer to Buyer such Property
notwithstanding such Casualty Loss and (ii) transfer to Buyer such Property
insurance proceeds, claims, awards and other payments arising out of such
Casualty Loss.  In the event the aggregate of any such payments or reductions in
Purchase Price exceed  ten percent (10%) of the Purchase Price, then either
Seller or Buyer shall have the option to terminate this Agreement. Seller shall
not voluntarily compromise, sell or adjust any amounts payable by reason of any
Casualty Loss without first obtaining the written consent of Buyer.

18.  SOLE REMEDY OF BUYER PRIOR TO CLOSING.   If at any time prior to Closing,
any of the representations and warranties made herein by Seller are materially
incorrect or if Seller fails to fully and timely comply in any material respect
with any of Seller's obligations as set forth herein or as required by
applicable law, Buyer may elect to terminate this Agreement and in such event
Buyer's remedy against Seller shall be to obtain a return of the Deposit
(unless an alternative remedy shall be mutually agreed upon between Buyer and
Seller); provided, however, if Seller shall fail or refuse to comply with any of
its obligations under this Agreement, Buyer shall be entitled to enforce this
Agreement through the remedy of specific performance.

19.  ENVIRONMENTAL MATTERS

     19.1  PRESENCE OF WASTES, NORM, HAZARDOUS SUBSTANCES, AND ASBESTOS. Buyer
acknowledges that the Properties have been used to explore for, develop and
produce oil and gas, and that spills of wastes, crude oil, produced water,
hazardous substances, and other materials may have occurred thereon.
Additionally, the Properties, including production equipment, may contain
asbestos, hazardous substances, or Naturally Occurring Radioactive Material
("NORM"). NORM may affix or attach itself to the inside of wells, materials, and
equipment as scale or in other forms, and NORM-containing material may have been
buried or otherwise disposed of on the Properties. Special procedures may be
required for remediating, removing, transporting, and disposing of asbestos,
NORM, hazardous substances, and other materials from the Property, and Buyer
assumes all liability for the assessment, remediation, removal, transportation,
and disposal of these materials and associated activities in accordance with the
applicable rules, regulations, and requirements of governmental agencies, unless
otherwise provided in this Section 19.
                           ---------- 

     19.2  ADVERSE ENVIRONMENTAL CONDITION.   "Adverse Environmental Condition"
means (a) any contamination or condition exceeding allowed regulatory limits and
not otherwise 

                                       16
<PAGE>
 
permanently authorized by permit or law, resulting from any discharge, release,
disposal, production, storage, treatment, or any other activities on, in or from
any Property prior to the Effective Date, or the migration or transportation
from other lands to any Property, prior to the Effective Date, of any wastes,
pollutants, contaminants, hazardous materials or other materials or substances
subject to regulation relating to the protection of the environment, including,
but not limited to, the Clean Air Act, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Federal Water Pollution Control Act,
the Safe Drinking Water Act, the Toxic Substance Control Act, the Hazardous and
Solid Waste Amendments Act of 1984, the Superfund Amendments and Reauthorization
Act of 1986, the Hazardous Materials Transportation Act, the Clean Water Act,
the National Environmental Policy Act, the Endangered Species Act, the Fish and
Wildlife Coordination Act, the National Historic Preservation Act, and the Oil
Pollution Act of 1990, as well as any state and local regulation or law
governing the same, similar or related matters, and (b) any such contamination
or condition in existence prior to the Effective Date temporarily authorized by
permit, fee agreement or other arrangement.

     19.3  ENVIRONMENTAL ASSESSMENT.   After the execution of this Agreement,
Buyer shall have the opportunity to conduct at its sole risk and expense an
environmental assessment of the Properties. Seller will provide reasonable
access for this purpose to Properties operated by Seller; for any Property not
operated by Seller, however, Buyer must contact the operator of any such non-
operated Property directly. Buyer or any of its representations and agents must
comply with Seller's environmental and safety rules and policies while
performing any environmental assessment on Seller-operated Properties. Buyer
agrees it will not disclose any information obtained in its environmental
assessment to third parties unless agreed to in writing by Seller or unless such
disclosure is expressly required by applicable law or regulation or is compelled
pursuant to legal process of any court or governmental authority. Buyer will
notify Seller in advance of any such disclosure and will furnish Seller copies
of all materials to be disclosed prior to any disclosure thereof to third
parties. As soon as possible after Buyer's receipt thereof, Buyer shall forward
to Seller copies of all reports, data, analysis, test results, remediation cost
estimates, and recommended remediation procedures or other information
concerning or derived from Buyer's environmental assessment.

     19.4  NOTICE OF ADVERSE ENVIRONMENTAL CONDITIONS.   Buyer shall notify
Seller in writing of any claimed Adverse Environmental Condition not less than
ten (10) days prior to the Closing Date (Environmental Defects Notice). The
Environmental Defects Notice shall (a) set forth in reasonable detail the Well
and/or Lease with respect to which a claimed Adverse Environmental Condition is
made, (b) the nature of such claimed Adverse Environmental Condition, and (c)
Buyer's proposed calculation of the cost to remediate each claimed Adverse
Environmental Condition (Remediation Value). Except as provided for in Section
                                                                       -------
19.7 hereof, Buyer shall waive its right to assert any claim or liability
----                                                                     
against Seller arising out of or in any way related to any Adverse Environmental
Condition not set forth in an Environmental Defects Notice delivered to Seller
not less than ten (10) days prior to the Closing Date.

     19.5  DETERMINATION OF ADVERSE ENVIRONMENTAL CONDITIONS AND REMEDIATION
VALUES. Within five (5) days after Seller's receipt of the Environmental Defects
Notice, Seller shall notify Buyer whether Seller agrees with Buyer's claimed
Adverse Environmental Conditions and/or the 

                                       17
<PAGE>
 
Remediation Value (Seller's Environmental Response). If Seller does not agree
with any claimed Adverse Environmental Condition and/or the Remediation Value,
then the parties shall enter into good faith negotiations and shall attempt to
agree on such matters. If the parties cannot reach agreement concerning either
the existence of an Adverse Environmental Condition or the Remediation Value
within ten (10) days after Buyer's receipt of Seller's Environmental Response,
then the matter shall be submitted to arbitration pursuant to the provisions of
Section 33 hereof and for purposes of Closing and Sections 8.3, 9.3 and 19.6
----------                                        ------------  ---     ----
hereof, an amount equal to Buyer's good faith estimate of the Remediation Value
shall control. Accordingly, at Closing, the Purchase Price shall be adjusted
based upon an estimate (as aforesaid) and the final value of the Remediation
Value, as decided by arbitration shall be a post Closing adjustment item to be
made pursuant to Section 13.1 hereof.
                 ------------        

     19.6  REMEDIES FOR ADVERSE ENVIRONMENTAL CONDITIONS. As to any Adverse
Environmental Condition, Seller (and Buyer with respect to subparagraphs (c) and
(d) below) shall have the election to:
 
           (a) remediate such Adverse Environmental Condition at Seller's sole
     cost in accordance with applicable environmental laws, and there shall be
     no adjustment to the Purchase Price in respect of such Adverse
     Environmental Condition and the provisions of Section 19.8 below shall
                                                   ------------
     thereafter apply in all respects;

           (b) reduce the Purchase Price by the applicable Remediation Value,
     which in no event shall exceed the Allocated Value of the Leases and/or
     Well affected by such Adverse Environmental Condition, in which event
     Seller shall have no other or further obligation or liability in respect of
     such Adverse Environmental Condition and the provisions of Section 19.8
                                                                ------------
     below shall thereafter apply in all respects;

           (c) delete from this Agreement the Property which contains the
     Adverse Environmental Condition and adjust the Purchase Price by the
     Allocated Value of such Property; or

           (d) in the event the aggregate sum of the Remediation Values exceeds
     ten percent (10%) of the Purchase Price, terminate this Agreement, in which
     case neither party shall have any further liability or obligation to the
     other hereunder except as regards obligations imposed by any
     confidentiality agreement, which shall survive such termination and be
     enforceable in accordance with the terms thereof.

If Seller elects (a) above, it will exercise all reasonable efforts and
diligence to complete remediation within six (6) months of the Closing Date, but
any failure to complete its efforts by such time shall not relieve Seller of its
duty to satisfy its obligation hereunder. Buyer shall allow Seller and its
agents and representatives such access to the Properties as is reasonably
necessary for performance of remediation work. Seller will conduct such work so
as not to unreasonably interfere with Buyer's or any designated operator's
operations.

                                       18
<PAGE>
 
     19.7   POST-CLOSING ADJUSTMENTS.  In addition to the rights granted to
Buyer above, Buyer shall have the right for a period of six (6) months following
Closing to provide Seller with written notice of any Adverse Environmental
Conditions with respect to the Properties which Buyer discovers subsequent to
the Closing.  The notice provided by Buyer to Seller of any such Adverse
Environmental Conditions shall contain the same information as is required to be
included in the Environmental Defects Notice as set out in Section 19.4 above.
                                                           ------------        
The Remediation Value of any such Adverse Environmental Conditions shall be
determined in the manner  set out in Section 19.5 above. Within five (5) days of
                                     ------------                               
the final determination of the Remediation Value of any such Adverse
Environmental Condition, Seller shall advise Buyer in writing of whether Seller
elects to (a) remediate such Adverse Environmental Condition at its sole cost
and expense in the manner set out in Section 19.6(a) above or (b) pay to Buyer
                                     ---------------                          
an amount equal to the Remediation Value of such Adverse Environmental Defect;
provided, however, in no event shall Seller ever be liable to Buyer for Adverse
Environmental  Conditions under this Section 19.7 in an aggregate amount in
                                     ------------                          
excess of $750,000. If Seller elects to pay Buyer for the Remediation Value of
an Adverse Environmental Condition, such payment shall be made to Buyer within
five (5) days of said election.   Buyer shall absolutely and forever waive its
right to assert any claim or liability against Seller arising out of or in any
way related to any Adverse Environmental Condition as to which Buyer has not
provided written notice to Seller within six (6) months of Closing.

     19.8  BUYER'S INDEMNIFICATION OF ADVERSE ENVIRONMENTAL CONDITIONS.  Except
for the costs associated with Seller's remediation of any Adverse Environmental
Conditions pursuant to Section 19.6(a) above (which shall be completed to
                       ---------------                                   
Buyer's reasonable satisfaction at Seller's sole cost and expense as soon as
reasonably practical, but in no event later than one (1) year after the Closing)
and Sellers obligations under Section 19.7 hereof, in the event that Closing
                              ------------                                  
occurs hereunder, Buyer shall indemnify, defend and hold Seller harmless from
and against any and all claims, demands, causes of action, liabilities and
obligations, and all costs and expenses (including, without limitation,
reasonable attorneys' fees and court costs) associated with all Adverse
Environmental Conditions arising before or after the Effective Date, including,
without limitation, any such conditions arising out of or relating to any
discharge, release, disposal, production, storage, treatment or any activities
on, in or from the Properties, or the migration or transportation from any other
lands to the Properties, whether before or after the Effective Date, of
materials or substances that are at present, or become in the future, subject to
regulation under federal, state or local laws or regulations, whether such laws
or regulations now exist or are hereafter enacted, INCLUDING, WITHOUT
LIMITATION, ANY CLAIMS, DEMANDS, CAUSES OF ACTION, LIABILITIES, OR OBLIGATIONS
ARISING IN WHOLE OR IN PART FROM THE SOLE OR CONCURRENT NEGLIGENCE OR STRICT
LIABILITY OF SELLER. BUYER HEREBY RELEASES SELLER FROM AND AGAINST ANY AND ALL
CLAIMS FOR CONTRIBUTION UNDER CERCLA AND/OR ANY OTHER ENVIRONMENTAL LAW OR
REGULATION.

20.  DTPA WAIVER.   To the extent applicable to the transaction contemplated
hereby or any portion thereof, Buyer waives the provisions of the Texas
Deceptive Trade Practices Act, Chapter 17, Subchapter E, Sections 17.41 through
17.63, inclusive (other than Section 17.555 which is not waived) of the Texas
Business and Commerce Code.  In connection with such waiver, Buyer hereby
represents and warrants to Seller that Buyer (a) is in the business of seeking
or acquiring by purchase 

                                       19
<PAGE>
 
or lease, goods or services, for commercial or business use, (b) has assets of
$5,000,000 or more according to its most recent financial statement, (c) has
knowledge and experience in financial and business matters that enable it to
evaluate the merits and risks of the transaction contemplated hereby, and (d) is
not in a significantly disparate bargaining position.

21.  FURTHER ASSURANCES.   After the Closing, Seller and Buyer shall execute,
acknowledge and deliver, or cause to be executed, acknowledged and delivered,
such instruments and take such other action as may be reasonably necessary or
advisable to carry out their obligations under this Agreement and under any
exhibit, document, certificate or other instrument delivered pursuant hereto.
Seller shall use its best efforts to obtain all approvals and consents required
by or necessary for the transactions contemplated by this Agreement that are
customarily obtained after Closing, provided that Seller shall not be required
to expend any funds to obtain such approvals and consents.

22.  ACCESS TO RECORDS.  As soon as practicable after Closing, Seller shall
deliver to Buyer, at Seller's address, or at such other place as any of same may
be kept, the originals of all Data, except that Seller may retain the originals
of all Data which relates to properties other than the Properties being sold
herein, in which case Seller shall deliver duplicate copies of any such retained
originals to Buyer. For a period of six (6) years after the date of Closing,
Buyer will retain the Data delivered to it pursuant hereto and will make such
Data available to Seller upon reasonable notice at Buyer's headquarters at
reasonable times and during office hours. Buyer shall notify Seller in writing
within thirty (30) days of the sale to a third party of all or any part of the
Properties which involves the transfer of any of the Data of the name and
address of the buyer(s) in any such sale. Buyer shall require as part of any
such sales transaction that such third party assume the obligations imposed on
Buyer in this Section 22.
              ---------- 

23.  USE OF BUYER'S NAME.  Buyer agrees that, as soon as practicable after the
Closing, Buyer will remove or cause to be removed the names and marks "AVIVA",
"Aviva America, Inc.", and all variations and derivatives thereof and logos
relating thereto from the Properties of which it has assumed operations and will
not thereafter make any use whatsoever of such names, marks, and logos.

24.  NOTICES.  All notices required or permitted under this Agreement shall be
in writing and shall be delivered personally or by telecopier as follows:

Seller:   AVIVA AMERICA, INC.
          Suite 400 LB 84
          8235 Douglas Avenue
          Dallas, TX 75225
          Telephone: (214) 691-3464
          Fax/Telecopier: (214) 361-0010
          Attention: Mr. Ron Suttill, President

                                       20
<PAGE>
 
Buyer:    BWAB INCORPORATED
          475 Seventeenth Street, Suite 1600
          Denver, Colorado 80202
          Telephone:  (303) 295-7444
          Fax/Telecopier:  (303) 294-9878
          Attention:  Mr. Steven A. Roitman, Principal

or to such other place within the United States of America as either Seller or
Buyer may designate as to themselves by written notice to the other. All notices
given by personal delivery or mail shall be effective on the date of actual
receipt at the appropriate address. Notice given by telecopier shall be
effective upon actual receipt if received during recipient's normal business
hours or at the beginning of the next business day after receipt if received
after the recipient's normal business hours. All notices by telecopier shall be
confirmed promptly after transmission, by mail or personal delivery.

25.  GOVERNING LAW.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.

26.  ASSIGNMENT.  This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto; it shall not, however, be assignable by Buyer
without Seller's prior written consent, which consent shall not be unreasonably
withheld in the event of a proposed assignment to an affiliate which is
financially capable of performing Buyer's obligations under this Agreement.

27.  ENTIRE AGREEMENT; AMENDMENTS; WAIVERS.  This Agreement constitutes the
entire agreement between the parties hereto with respect to the subject matter
hereof, superseding all prior negotiations, discussions, agreements and
understandings, whether oral or written, relating to such subject matter. This
Agreement may not be amended and no rights hereunder may be waived except by a
written document signed by the party to be charged with such amendment or
waiver. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereto (whether or not
similar) nor shall such waiver constitute a continuing waiver unless otherwise
expressly provided.

28.  HEADINGS.  The headings of the articles and sections of this Agreement and
any listing of its contents are for guidance and convenience of reference only
and shall not limit or otherwise affect any of the terms or provisions of this
Agreement.

29.  COUNTERPARTS.  This Agreement may be executed by Buyer and Seller in any
number of counterparts, each of which shall be deemed an original instrument,
but all of which together shall constitute but one and the same instrument.

30.  EXPENSES, FEES AND TAXES.  Each of the parties hereto shall pay its own
fees and expenses incident to the negotiation and preparation of this Agreement
and consummation of the transactions contemplated hereby, including broker fees.
Buyer shall be responsible for the cost of all fees for the recording of
transfer documents. All other costs shall be borne by the party incurring them.
Notwithstanding anything to the contrary herein, it is acknowledged and agreed
by and between 

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<PAGE>
 
Seller and Buyer that the Purchase Price excludes any sales taxes or other taxes
in connection with the sale of property pursuant to this Agreement. If a
determination is ever made that a sales tax or other transfer tax applies, Buyer
shall be liable for such tax as well as any applicable conveyance, transfer and
recording fees, and real estate transfer stamps or taxes imposed on any transfer
of property pursuant to this Agreement. Buyer shall indemnify and hold Seller
harmless with respect to the payment of any of such taxes, including any
interest or penalties assessed thereon.

31.  LAWS AND REGULATIONS.  From and after the Closing, (a) Buyer shall comply
with all applicable laws, ordinances, rules and regulations and shall properly
obtain and maintain all permits required by public authorities with regard to
the Properties, and shall provide and maintain with the applicable regulatory
agency(ies) all required bonds, and (b) Buyer shall assume all of Seller's
obligations with regard to abandonment of all existing unplugged wells, whether
producing or nonproducing, and abandonment of the leasehold property including,
where applicable, the plugging of wells and the restoration of the surface as
completely as practicable and/or in compliance with all applicable laws, rules,
regulations and in compliance with all leases and other agreements affecting the
Properties, and shall indemnify and hold Seller harmless with respect to any and
all of those obligations. Such obligations shall survive the Closing and Buyer
shall remain liable therefor as regards Seller even if Buyer shall assign, sell
or transfer the Properties to a third party.

32.  CONFIDENTIALITY; PUBLIC ANNOUNCEMENTS.   The terms of this Agreement are
considered confidential to the parties hereto, and neither party may disclose
any of the terms of this Agreement to any third person prior to the Closing
without the prior written consent of the other party (which consent will not be
unreasonably withheld); provided that each party may disclose the terms of this
Agreement as required by applicable laws or the applicable rules and regulations
of any governmental agency or securities exchange, and the parties hereto may
disclose the terms of this Agreement to those of its and its affiliates'
employees, directors, attorneys, accountants, engineers and other consultants as
may be required in connection with the negotiation, evaluation and
implementation of this Agreement. Except as may be required by applicable laws
or the applicable rules and regulations of any governmental agency or securities
exchange, neither Buyer nor Seller shall issue any such press release or other
publicity without the prior written consent of the other party, which consent
shall not be unreasonably withheld.

33.  ARBITRATION.  Except as otherwise specifically provided herein, any
controversy under this Agreement shall be submitted to arbitration in Dallas,
Texas, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association.  Upon written demand of either party, the parties shall
meet and attempt to appoint a single arbitrator.  If the parties fail to name an
arbitrator within ten (10) days from such demand, then the arbitrator(s) shall
be selected by the American Arbitration Association from the panels of
arbitrators of the American Arbitration Association.  The arbitrator(s) selected
to act hereunder shall be qualified by education and training to pass upon the
particular question in dispute and shall make a decision on the dispute within
thirty (30) days after his or their appointment, subject to any reasonable delay
due to unforeseen circumstances. The compensation and expenses of the
arbitrator(s) shall be borne equally by the parties.  Arbitration may proceed in
the absence of any party if notice of the proceedings has been given to such
party.  The parties agree to abide by all awards rendered in such proceedings.

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34.  EXHIBITS.  The following Exhibits and Schedules are incorporated herein and
are a part hereof:

                                    EXHIBITS
                                    --------

                               Exhibit A - Wells
                               Exhibit B - Leases
                          Exhibit C - Allocated Values
          Exhibit D - Form of Assignment, Bill of Sale and Conveyance

                                   SCHEDULES
                                   ---------

                         Schedule 4.3 - Gas Imbalances
              Schedule 5.5 - Preferential Purchase Rights/Consents
                      Schedule 5.6 - Litigation and Claims
                    Schedule 5.15 - Outstanding Obligations


Executed as of the date set forth above.

SELLER

     AVIVA AMERICA, INC.

By: /s/ Ronald Suttill
   --------------------------------
Its: President
    -------------------------------

BUYER

     BWAB INCORPORATED


By: /s/ Randall C. Roulier
   --------------------------------

Its: President
    -------------------------------

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