GAS PURCHASE CONTRACT


                                    BETWEEN


                            NEUTRINO RESOURCES INC.


                                      AND


                                PROGAS LIMITED





                          DATE:     NOVEMBER 1, 1997


                         AREA:    PINE CREEK/WINDFALL
<PAGE>
                             GAS PURCHASE CONTRACT

                                     Index

                                                                        PAGE
ARTICLE  I        DEFINITIONS                                           1

ARTICLE  II       COMMENCEMENT AND PRELIMINARY MATTERS
                  2.01  Commencement                                    5
                  2.02  Preliminary Obligations of Seller               5
                  2.03  Preliminary Obligations of Buyer                5

ARTICLE  III      RESERVATIONS OF SELLER
                  3.01  Operations                                      6
                  3.02  Rates of Flow                                   7
                  3.03  Pooling                                         7 
                  3.04  Conservation                                    7

ARTICLE  IV       QUANTITY OF GAS
                  4.01  Daily Contract Quantity                         7
                  4.02  Annual Purchase Obligation                      8
                  4.03  Operating Allowance                             8
                  4.04  Decrease in Deliverability                      9
                  4.05  Increase in Deliverability                      10
                  4.06  Assignment of NOVA Capacity                     11
                  4.07  Common Operations Agreement                     11
                  4.08  Regulatory Restriction                          11

ARTICLE  V        QUALITY AND MEASUREMENT
                  5.01  Quality                                         11
                  5.02  Measurement                                     12

ARTICLE  VI       DELIVERY PRESSURE                                     12

ARTICLE  VII      RECEIPT POINT                                         12
ARTICLE  VIII     POSSESSION OF AND TITLE TO GAS                        12
ARTICLE  IX       TERM                                                  12
ARTICLE  X        PRICE
                  10.01 Netback Price                                   13
                  10.02 Definitions                                     13
                  10.03 Renegotiation Rights                            18
                  10.04 Annual Audit                                    20
                  10.05 Producer Vote Mechanism for                     
                        Netback Price Clause                            21
                  10.06 Arbitration                                     22
                  10.07 Settlement Payments                             23
                  10.08 Use of Estimates for Calculating               
                        Netback Price                                   23
                  10.09 Basis of Payment                                24
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                                     -ii-
                                                                        PAGE

                  10.10 Resale Price Arbitration                        24
                  10.11 Endorsement of Previous Producer
                        Approvals                                       25

ARTICLE  XI       BILLINGS AND PAYMENTS
                  11.01 Billings and Payments                           25
                  11.02 Failure to Pay                                  26
                  11.03 Errors and Adjustments                          26
                  11.04 Inspection of Records                           27

ARTICLE  XII      LAWS AND REGULATORY BODIES

                  12.01 Regulation                                      27
                  12.02 Law of Contract                                 27

ARTICLE  XIII     FORCE MAJEURE

                  13.01 Force Majeure Defined                           27
                  13.02 Where Force Majeure Unavailable                 28
                  13.03 Notice of Remedy                                28
                  13.04 Discretion Re: Labour Disputes                  28
                  13.05 Adjustment of Purchase Obligation               29

ARTICLE  XIV      WARRANTY OF TITLE
                  14.01 Warranty of Title                               29
                  14.02 Indemnity                                       29

ARTICLE  XV       GAS RESERVES OF SELLER
                  15.01 Dedication of Reserves                          30
                  15.02 Furnishing of Information                       30

ARTICLE  XVI      ARBITRATION                                           30

ARTICLE  XVII     NOTICES                                               32

ARTICLE  XVIII    OTHER
                  18.01 Non-Waiver of Future Default                    32
                  18.02 Assignment                                      32
                  18.03 Headings                                        33
                  18.04 Units of Measurement                            33
                  18.05 Numerical References                            33
                  18.06 Time of Essence                                 33
                  18.07 Usage or Custom                                 33
                  18.08 Severance                                       33
                  18.09 Entire Agreement                                34
                  18.10 Execution in Counterpart                        34
SCHEDULE "X"                                                
EXHIBIT  "A"                                          
EXHIBIT  "B"
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THIS GAS PURCHASE CONTRACT made as of the 1st day of November, 1997 between:





                        NEUTRINO RESOURCES INC.,
                        a corporation having an office in
                        Calgary, Alberta
                        (the "Seller")


                                    - and -


                        PROGAS LIMITED,
                        a corporation having an office in
                        Calgary, Alberta
                        (the "Buyer")




BACKGROUND:
      Seller has interests in the Areas set forth in Exhibit "A", and Seller
has, or will have, a supply of gas available from these areas which Seller has
agreed to sell to Buyer; Buyer has agreed to purchase this gas, to supplement
its existing supply, for resale to its various markets;

      IN CONSIDERATION of the mutually beneficial terms and conditions in this
Contract, the parties agree as follows:

                            ARTICLE I - DEFINITIONS

1.01 Unless another definition is expressly stated, the following terms, where
used in this Contract, and all exhibits, recitals and appendices, will have the
following meaning:

      (a)   "Aggregate DCQ" means the sum of the DCQ's in effect for each
            Receipt Point as set forth in Exhibit "B";
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                                    - 2 -

      (b)   "contract year" means a period of twelve (12) consecutive months
            beginning with the month of November, provided that the first (1st)
            contract year will be the period commencing on the Date of First
            Delivery of gas and ending the first day of the next month of
            November;

      (c)   "cubic metre" means the volume of gas which occupies one (1) cubic
            metre when this gas is at a standard temperature of fifteen (15)
            degrees Celsius and at a standard pressure of one hundred and one
            and three hundred and twenty-five one-thousandths (101.325)
            kilopascals absolute;

      (d)   "Daily Contract Quantity" ("DCQ") for each Receipt Point has the
            meaning set forth in Article IV;

      (e)   "Date of First Delivery" for each Receipt Point means the date on
            which Seller first delivers gas in response to Buyer's request under
            this Contract;

      (f)   "day" means a period of twenty-four (24) consecutive hours, 
            beginning at 8:00 o'clock a.m. Mountain Standard Time;

      (g)   "Deliverability" for each Receipt Point means Seller's share of the
            maximum daily quantity of gas production which can be delivered at a
            stabilized flow rate from wells on Seller's Lands, to that Receipt
            Point, as this deliverability is determined or redetermined under
            Article IV;

      (h)   "energy content" means the product obtained, expressed in gigajoules
            (GJ), by multiplying the standard volume of the gas, expressed in
            thousands of cubic metres (103m3), by the gross heating value of the
            gas;

      (i) "Facilities Completion Date" for each Receipt Point means the date by
           which:

            (i)   Buyer is in possession of completed firm transportation
                  capacity sufficient to transport a quantity of gas equal to
                  the Initial Deliverability downstream of that Receipt Point as
                  described in Section 2.03; and
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                                    - 3 -

            (ii)  Seller is in possession of those facilities required to
                  deliver a quantity of gas equal to the Initial Deliverability
                  upstream of and to that Receipt Point on a firm basis, as
                  described in Section 2.02;

      (j)   "gas" means natural gas or residue gas, but excludes solution gas;

      (k)   "gross heating value" means the total joules, expressed in
            megajoules per cubic metre (MJ/m3), produced by the complete
            combustion at constant pressure of one (1) cubic metre of gas with
            air, with the gas free of water vapour, the temperature of the gas,
            air and products of combustion at standard temperature and all water
            formed by combustion condensed to a liquid state;

      (l)   "Initial Deliverability" means the initial Deliverability for each
            Receipt Point agreed to by Buyer and Seller and set forth in Exhibit
            "B";

      (m)   "joule" ("J") means the work done when the point of application of a
            force of one (1) newton is displaced a distance of one (1) metre in
            the direction of the force; and

            (i)   "megajoule" ("MJ") means one million (1,000,000) joules;

            (ii) "gigajoule" ("GJ") means one billion (1,000,000,000) joules;

      (n)   "leases" means all documents and titles under which Seller is
            entitled to drill for, produce or sell gas from Seller's Lands;

      (o)   "month" means a period beginning at 8:00 o'clock a.m. Mountain
            Standard Time on the first (1st) day of a calendar month and ending
            at 8:00 o'clock a.m. Mountain Standard Time on the first (1st) day
            of the next calendar month;

      (p)   "NOVA" means NOVA Gas Transmission Ltd. or any successor;
<PAGE>
                                    - 4 -

      (q)   "NOVA Tariff" means the NOVA General Terms and Conditions, as
            amended or changed by NOVA during the term of this Contract;

      (r)   "Purchase Obligation" has the meaning set forth in Article IV for
            each Receipt Point;

      (s) "Receipt Point" has the meaning set forth in Article VII;

      (t)   "Seller's Lands" means Seller's interest in the lands, geological
            zones and horizons described in Exhibit "A";

      (u)   "Seller's Reserves" means all of the gas which can, or may at some
            future date, be economically recovered from Seller's Lands and which
            Seller, has or will have, a right to drill for, produce or sell;

      (v)   "solution gas" means gas that is dissolved in crude oil under
            reservoir conditions and produced as a result of pressure and
            temperature changes associated with the production of oil;

      (w)   "Target Date of First Delivery" for each Receipt Point means the
            dates set out in Exhibit "B" or such other date that may be agreed
            to in writing by Buyer and Seller.

      (x)   "103m3" means one thousand (1,000) cubic metres;

      (y)   "week" means a period of seven (7) consecutive days.
<PAGE>
                                    - 5 -

               ARTICLE II - COMMENCEMENT AND PRELIMINARY MATTERS

2.01  COMMENCEMENT
      The obligations of Seller to deliver gas and Buyer to purchase gas for
each Area shall commence on the later of the Target Date of First Delivery or
the Facilities Completion Date. Each party will keep the other advised as to the
status of the items under Sections 2.02 and 2.03.

2.02  PRELIMINARY OBLIGATIONS OF SELLER
      Seller will diligently take those steps that are necessary to commence the
production and delivery of gas from Seller's Reserves to Buyer at the Receipt
Point(s), in an amount equal to the Initial Deliverability for each Receipt
Point, including:

      (a)   applying for and diligently seeking to secure and maintain any
            regulatory authorizations which may be necessary for the term of
            this Contract;

      (b)   arranging the production and firm gathering and processing required;
            and

      (c)   unless otherwise mutually agreed, Seller will be responsible for
            arranging firm NOVA receipt capacity for each Receipt Point for the
            level of the Initial Deliverability to that Receipt Point, and will
            assign this capacity to Buyer for the date that the Seller is able
            to commence deliveries. Buyer's acceptance of this assignment will
            be subject to Section 4.04(b).

2.03  PRELIMINARY OBLIGATIONS OF BUYER
      Buyer will diligently take those steps that are necessary to enable Buyer
to take delivery of gas from each Receipt Point up to the level of the Initial
Deliverability at that Receipt Point on the Target Date of First Delivery for
the term of this Contract, including:

      (a)   applying for and diligently seeking to secure and maintain any
            regulatory authorizations required to accept delivery and remove the
            gas for sale to Buyer's markets;
<PAGE>
                                    - 6 -

      (b)   arranging and maintaining all required transportation capacity
            downstream of the Receipt Point; and

      (c)   accepting an assignment of the NOVA receipt capacity from Seller as
            set forth in Section 2.02(c).

                     ARTICLE III - RESERVATIONS OF SELLER

3.01  OPERATIONS

      Seller expressly reserves the right to operate Seller's Lands free from
any controls by Buyer and in a manner that Seller, in its sole discretion, may
deem advisable including the right:

      (a)   to determine when an additional well will be drilled, when an
            existing well will be reworked or recompleted, when a well cannot,
            or has ceased to, produce gas in paying quantities having regard to
            Seller's cost of producing, processing and delivering such gas, and
            when a well is to be abandoned;

      (b)   to deliver gas in kind to any interest holders which Seller is
            obligated to deliver to, provided that the gas is not committed to
            Buyer under this Contract;

      (c)   to use quantities of gas which may be required for the operation of
            separator equipment, extraction plants, compressor stations and
            other facilities through which the gas to be delivered may be
            processed or handled. However, if other gas or gas constituents are
            processed through any of these facilities, an equitable amount of
            other gas or gas constituents shall be used as fuel in these
            facilities; and

      (d)   during a period of Buyer's Force Majeure under Article XIII, to sell
            and deliver gas to third parties to the extent necessary to prevent
            the termination of any of Seller's leases for reason of
            non-production.
<PAGE>
                                    - 7 -

3.02  RATES OF FLOW

      Seller is not required to produce wells in excess of the allowable rates
of flow, as determined by law or regulatory bodies; in excess of the maximum
efficient rates of flow, as determined by Seller; or in excess of the current
rate of production permitted under the terms of operating agreements in place
where wells are jointly operated with other parties. Seller shall advise Buyer
about any restrictions on production as soon as Seller becomes aware of them if
these restrictions would affect Deliverability.

3.03  POOLING

      Seller may pool or unitize any of Seller's Lands with the interests of
third parties in other lands in the same field provided that this Contract binds
Seller in respect of Seller's interest in the pooled or unitized area and the
gas attributable to that interest. If the pooling or unitization is entered into
voluntarily by Seller, Seller shall protect Buyer's rights under this Contract
and prevent any appreciable reduction or postponement in the Deliverability.

3.04  CONSERVATION

      Seller may adopt or participate in any oil or gas proration, conservation,
rateable take or similar program, provided, if this program may decrease
Deliverability, the program shall not be entered into voluntarily by Seller
without Buyer's prior consent.

                         ARTICLE IV - QUANTITY OF GAS

4.01  DAILY CONTRACT QUANTITY

      (a)   "Daily Contract Quantity" ("DCQ") for each Receipt Point means: (i)
            at the Date of First Delivery, a daily quantity of gas equal to the
            Initial Deliverability for that Receipt Point; and (ii) thereafter,
            the Deliverability for that Receipt Point as adjusted over the term
            hereof pursuant to Sections 4.04 and 4.05. In no event shall the DCQ
            exceed the maximum firm NOVA receipt capacity available to Buyer
            from the Receipt Points, unless otherwise agreed to by Buyer.
<PAGE>
                                    - 8 -

      (b)   After commencement under Section 2.01, Buyer shall have the right to
            request, purchase and receive from Seller and Seller shall have the
            obligation to sell and deliver to Buyer the gas from Seller's Lands
            at the daily rates that Buyer may request up to the Daily Contract
            Quantity at each Receipt Point.

4.02  ANNUAL PURCHASE OBLIGATION
      Subject to the terms of this Contract, in each contract year, Buyer agrees
to purchase from Seller, from each Receipt Point, an annual quantity of gas
equal to the Purchase Obligation. The Purchase Obligation for each Receipt Point
is a quantity of gas equal to the product obtained by multiplying the Total
Annual Gas Purchases by Seller's Pro Rata Share where:

      (a)   "Total Annual Gas Purchases" means the total quantity of gas
            purchased by Buyer for Buyer's markets in the contract year.

      (b) "Seller's Pro Rata Share" means the percentage obtained by dividing,

            (i)   the Daily Contract Quantity for that Receipt Point under this
                  Contract existing on each day during the contract year less
                  the quantity of gas which Seller failed to deliver to Buyer in
                  response to Buyer's requests at that Receipt Point in the
                  contract year, ("Adjusted Minimum Annual Quantity") by,

            (ii)  the aggregate of the Adjusted Minimum Annual Quantity, or
                  equivalent, under all of the gas purchase contracts under
                  which Buyer purchased gas in the contract year.

4.03  OPERATING ALLOWANCE
      Buyer will use reasonable efforts to request gas at uniform daily rates of
flow. As the Purchase Obligation is calculated at the end of a contract year and
the nature of gas buying operations necessitate accuracy tolerances, Buyer shall
be deemed to have fulfilled the Purchase Obligation if the quantity of gas
requested by Buyer in the contract year is within three percent (3%) of the
Purchase Obligation. In the event that the quantity of gas requested by Buyer
differs from the Purchase Obligation by more than three percent
<PAGE>
                                    - 9 -

(3%), the entire difference between the quantity of gas requested and the
Purchase Obligation shall be subtracted from (or added to as the case may be)
Buyer's Purchase Obligation for the next contract year. Notwithstanding the
foregoing if, in any contract year for any reason, Seller fails to deliver the
quantity of gas requested by Buyer and Buyer has requested a quantity of gas
equal to, or greater than the Purchase Obligation then Buyer shall be deemed to
have satisfied its Purchase Obligation for such contract year and the provisions
of this Section which could otherwise obligate Buyer to add to its Purchase
Obligation for the next contract year shall not apply. Buyer is not obligated to
accept deliveries of gas in excess of Buyer's request.

4.04  DECREASE IN DELIVERABILITY

       (a)    If Seller fails in any month to deliver to Buyer at least ninety
              percent (90%) of the quantity requested by Buyer from a Receipt
              Point and this failure is not excused by an event of Force
              Majeure, then Buyer may reduce the Daily Contract Quantity at that
              Receipt Point to the level of the average Deliverability for that
              month by providing Seller with a written notice of the reduction
              ("Reduction Notice"). The reduction will be effective on the first
              (1st) day of the month following the date of the Reduction Notice
              unless, prior to this date, Seller demonstrates to Buyer's
              satisfaction that the Deliverability to that Receipt Point has
              been restored in whole. Any restoration after this date will be in
              accordance with Section 4.05.

       (b)    If Buyer reduces the Daily Contract Quantity at a Receipt Point by
              issuing a Reduction Notice based on Deliverability during the
              first twelve (12) months following the Date of First Delivery or
              following an increase in the Daily Contract Quantity pursuant to
              Section 4.05, Buyer will have the option to assign to Seller a
              quantity of NOVA receipt capacity equal to the amount of the
              reduction. Seller agrees to accept assignment of the excess NOVA
              capacity and to reimburse Buyer for any NOVA charges billed to
              Buyer for this excess capacity from the effective date of the
              Reduction Notice.

       (c)    If Buyer reduces the Daily Contract Quantity at a Receipt Point by
              issuing a Reduction Notice based on Deliverability after the first
              twelve (12) months
<PAGE>
                                    - 10 -

            following the Date of First Delivery or following an increase in the
            Daily Contract Quantity pursuant to Section 4.05, Buyer will have
            the right to dispose of NOVA receipt capacity equal to the amount of
            the reduction. If Buyer disposes of this excess NOVA capacity, any
            subsequent increase in the Daily Contract Quantity at that Receipt
            Point will be subject to Section 4.05 and, in particular, the
            ability of Seller to acquire the necessary firm NOVA receipt
            capacity. Seller may request Buyer to retain this excess NOVA
            capacity on their behalf provided Seller agrees to reimburse Buyer
            for any costs incurred by Buyer for that excess capacity from the
            effective date of the Reduction Notice until such time as the
            capacity is again utilized under this Contract or until Buyer is
            able, with Seller's consent, to dispose of the excess capacity.
            Seller agrees that Buyer has the right to offset these NOVA costs
            against amounts payable to Seller pursuant to Section 11.01.

4.05 INCREASE IN DELIVERABILITY

      (a)   Seller shall advise Buyer in writing as soon as reasonably
            practicable, of any increase or anticipated increase in the
            Deliverability to a Receipt Point ("Increase Notice"). Unless an
            earlier date is agreed to by Buyer, the Daily Contract Quantity at
            that Receipt Point will increase to reflect the increase in
            Deliverability, effective the later of:

            (i)   the date that Seller is able to produce and deliver the
                  increased Daily Contract Quantity to that Receipt Point;

            (ii)  the first (1st) day of the month following sixty (60) days
                  from Buyer's receipt of the Increase Notice; and

            (iii)       the date that Buyer is in possession of firm NOVA
                        receipt capacity at the Receipt Point sufficient to
                        transport the increase in the Daily Contract Quantity.

      (b)   Unless otherwise agreed, Seller shall be responsible for obtaining
            any incremental firm NOVA receipt capacity required to transport the
            increase in
<PAGE>
                                    - 11 -

            the Daily Contract Quantity and shall assign this capacity to Buyer.
            If Seller is unable to maintain the increase in the Daily Contract
            Quantity for twelve (12) months, Buyer will have the right to assign
            to Seller any excess NOVA capacity in accordance with Section
            4.04(b).

4.06  ASSIGNMENT OF NOVA CAPACITY

      In the event that Seller exercises its right under Section 11.02 of this
Contract to suspend deliveries of gas, or terminate this Contract, Seller agrees
to accept a temporary assignment of the NOVA receipt capacity from Buyer for the
period of any suspension of deliveries or, a permanent assignment in the case of
termination of this Contract.

4.07  COMMON OPERATIONS AGREEMENT

      In the event that Buyer is purchasing gas from two (2) or more joint
interest producers at a common Receipt Point, Seller agrees to enter into
Buyer's then standard form common operations agreement with these other joint
interest producers.

4.08  REGULATORY RESTRICTION

      If the daily quantity of gas which Seller is entitled to produce from
Seller's Lands is subject to reduction by any order, regulation or action of any
court or regulatory body for any period, this reduced quantity shall be the
Daily Contract Quantity for this period. Buyer shall be entitled to reduce the
NOVA receipt capacity in accordance with Section 4.04(c) if, in the Buyer's sole
discretion, this reduction is likely to be in effect for any sustained period.

                      ARTICLE V - QUALITY AND MEASUREMENT

5.01  QUALITY

      The quality of the gas to be purchased shall be in accordance with the
quality standards in the NOVA Tariff. If the gas offered for delivery by Seller
at a Receipt Point fails at any time, to conform with the quality standards of
NOVA, then Buyer, at its sole discretion, may refuse to accept delivery or
purchase of this gas until correction by Seller. If, on any day during a
contract year, Buyer so refuses the gas ("Off Quality Day"), the Purchase
Obligation for that Receipt Point shall be adjusted by subtracting the number of
<PAGE>
                                    - 12 -

Off Quality Days from the number of days in the contract year when calculating
the Adjusted Minimum Annual Quantity in Section 4.02.

5.02  MEASUREMENT
      Buyer and Seller agree to accept the measurements of the total volume and
gross heating value of the gas purchased at the Receipt Point as conducted by
NOVA in accordance with the NOVA Tariff.

                        ARTICLE VI - DELIVERY PRESSURE

6.01 The pressure of the gas to be delivered shall be at the pressure required
under the NOVA Tariff to ensure the gas will enter the pipeline facilities of
NOVA at the Receipt Point.

                        ARTICLE VII - RECEIPT POINT

7.01 The Receipt Point(s) for all gas delivered under this Contract shall be
that point where the gas first enters the facilities of NOVA, as set forth in
Exhibit "B", and which may be changed by mutual agreement of the parties from
time to time during the term of this Contract.

                ARTICLE VIII - POSSESSION OF AND TITLE TO GAS

8.01 Title of all gas delivered shall pass from Seller to Buyer, for the account
of Buyer, at the Receipt Point(s). Until such delivery, Seller shall be deemed
to be in control or possession of, have title to and be responsible for this
gas. After delivery, Buyer shall be deemed to be in control or possession of,
have title to, and be responsible for the gas.

                               ARTICLE IX - TERM

9.01 The term of this Contract shall be from the date first above written until
gas can no longer be recovered or produced from Seller's Reserves.
<PAGE>
                                    - 13 -

                              ARTICLE X - PRICE

10.01       NETBACK PRICE

      Subject to the other provisions in Article X, the price to be paid by
Buyer to Seller for gas delivered under this Contract shall be:

      (a)   during the period or periods in which an agreement between the
            Governments of Alberta, British Columbia and/or Saskatchewan and the
            Government of Canada exists for the purpose of establishing the
            price or prices to be paid for gas purchased by Buyer (a
            "Federal-Provincial Agreement"), or the price to be paid for such
            gas is otherwise determined by law, the prices in effect under this
            Contract for such volumes shall be the price or prices in existence
            from time to time, as determined by and resulting from the
            Federal-Provincial Agreement or the applicable law; and

      (b)   in the event that a Federal-Provincial Agreement is not in effect,
            or the price to be paid for gas delivered is not otherwise
            determined by law, or is in effect but does not cover all volumes
            purchased by Buyer for any period of time during the term of this
            Contract, Buyer shall pay Seller monthly for each unit of gas
            delivered by Seller during such period a unit price (the "Netback
            Price") calculated as follows:

                        Netback Price = GSR - TC - FFS
                                        --------------
                                               TGS

10.02       DEFINITIONS

      For the purposes of Article X, the following definitions shall apply:

      (a)   "GSR" or "Gas Sales Revenue" means the sum of all revenue, including
            any adjustments for prior months, received by Buyer in such month
            from the resale of gas purchased from Buyer's Producer Pool to Pool
            Approved Sales Contracts, less:
<PAGE>
                                    - 14 -

            (i)   that portion of all demand charges or charges of a similar
                  type under Pool Approved Sales Contracts which relate
                  specifically to Buyer's costs, and

            (ii)  any taxes, levies or charges prescribed by law, or any
                  governmental body, in respect of the subject sales, and

            (iii) Buyer's interest and financing costs incurred to pay the
                  Goods and Services Tax imposed under the Excise Tax Act
                  (Canada), as amended, or any successor or similar federal or
                  provincial legislation exigible on the purchase of gas
                  delivered and for which Buyer is entitled to a credit or
                  refund which has not yet been received; and

            (iv)  costs incurred by Buyer to acquire replacement gas supply
                  where Buyer is required to deliver gas under a Pool Approved
                  Sales Contract and is unable for whatever reason to obtain
                  supply from Buyer's Producer Pool.

      (b)   "TC" or "Transportation Costs" means the monthly transportation 
            charges of TransCanada PipeLines Limited, Foothills Pipe Lines Ltd.,
            NOVA and any other transporters applicable to Pool Approved Sales
            Contracts, in addition to any cost of pipeline fuel, measurement
            variances and losses, taxes on the use of fuel, the carrying cost of
            and changes to the value of inventory and line pack, letters of
            credit and the cost of financial assurances provided to these
            transporters, associated operational storage costs and other
            transportation related charges as they apply to the purchase and
            sale of Pool gas.

      (c)   "FFS" or Buyer's "Fee For Service" for any month means the sum of
            Buyer's Operating Costs ("Operating Costs"), Buyer's Incentive Based
            Return ("IBR") and Producer Approved Costs ("PAC") in such month.
<PAGE>
                                    - 15 -

      (d)   "Buyer's Producer Pool" or "Pool" means the pool of producers who
            have dedicated gas to Buyer pursuant to contracts with price clauses
            substantially similar to this Article X.

      (e)   "Pool Approved Sales Contracts" means contracts or markets which
            have been approved by Buyer's Alberta Producers as required by
            Alberta law.

      (f)   "Buyer's Operating Costs" or "Operating Costs" include the general
            and administrative costs and fixed asset expenditures incurred in
            developing and administering Buyer's Producer Pool, Pool Approved
            Sales Contracts and associated transportation, net of all costs
            referred to in subsection 10.02 (f)
            (iv) hereof, and shall be determined as follows:

            (i)   for the contract year commencing November 1, 1997, a monthly
                  amount equal to six hundred and sixty thousand dollars
                  ($660,000),

            (ii)  for the contract years commencing November 1, 1998 and
                  thereafter, the monthly amount shall be increased by a factor
                  equal to the increase in the Canadian Consumer Price Index in
                  the 12 month period immediately preceding such contract year,
                  plus one and one half percent (1.5%).

            (iii) for the contract years commencing November 1, 1997 and 
                  thereafter, Buyer's Operating Costs shall also be decreased or
                  increased by the following:

                  A.    Buyer's over-recovery or under-recovery of its cost of 
                        service for the contract year ending October 31, 1997, 
                        as determined by the APMC in its final annual audit, and

                  B.    any surcharges paid or refunds received by Buyer as a
                        result of a revision to income taxes or any other
                        eligible Cost of Service components over-recovered or
                        under-recovered in the period prior to November 1, 1997.
<PAGE>
                                    - 16 -

                  All adjustments to Operating Costs pursuant to subsections
                  10.02 (f) (iii) (A) and (B) above shall be made over the
                  remainder of the year in which the adjustments were identified
                  or period outlined above, unless Buyer's Producer Pool
                  approves a longer period, and shall have no effect on the
                  level of the Operating Costs in subsequent years.

            (iv)  In each month commencing November, 1997, the amount calculated
                  above shall be reduced by that portion of all demand charges
                  or similar charges recovered from Pool Approved Sales
                  Contracts in such month which relate to Buyer's costs.

      (g)   Buyer's "Incentive Based Return" or "IBR" shall consist of a charge
            based on Buyer's load factor and price performance and shall be
            calculated in the following manner:

            (i)   If, in a contract year, Buyer pays to the Pool a sum of money 
                  equal to the amount that would be paid if Buyer purchased gas
                  from the Pool at a load factor of eighty percent (80%) and at
                  a Netback Price equal to the Alberta Reference Price (ARP)
                  (the "Base Revenue"), and if Buyer pays a Netback Price equal
                  to or greater than the ARP, Buyer shall earn a return of
                  eighty-five thousand dollars ($85,000) per month (the "Base
                  Return"). For the purpose of determining whether Buyer has
                  earned the Base Return, the Netback Price shall be calculated
                  prior to the deduction of the Base Return.

            (ii)  In addition to the Base Return, for each dollar of revenue 
                  above the Base Revenue plus the Base Return which is paid to
                  the Pool (the "Incremental Revenue"), Buyer shall retain that
                  percentage set forth in the table contained in Schedule "X" to
                  this Contract (the "Incremental Return"), subject to the
                  limits shown on the Schedule. For the purpose of determining
                  the Incremental Return, the Incremental Revenue shall be
                  calculated prior to the deduction of the Incremental Return.
<PAGE>
                                    - 17 -

            (iii)  If Buyer's sales fall below a load factor of eighty percent 
                  (80%) in any year because of a failure to obtain producer
                  support for sales, in all calculations to determine the IBR,
                  the Base Revenue shall be calculated using Buyer's actual
                  purchase load factor in such year. The Incremental Revenue
                  shall be determined by multiplying the difference between the
                  actual netback price paid by Buyer in such year and the ARP,
                  by the number of units sold. The Incremental Return shall be
                  calculated by multiplying the Incremental Revenue by the
                  applicable percentage outlined in Schedule "X" for the amount
                  by which the actual netback price paid exceeded the ARP.

            (iv)  For the purpose of determining the IBR, any replacement gas
                  supply costs which have been deducted from GSR pursuant to
                  Section 10.02 (a) (iv) shall be included as revenue for the
                  period in question.

            (v)   Buyer shall estimate the level of the IBR each month of the
                  contract year and adjust it based on the performance of Buyer
                  to the end of such month and projections for the remainder of
                  the year. If Buyer has over or under-collected the IBR during
                  such year, as indicated by an audit conducted pursuant to
                  Section 10.04, the amount over-collected or under-collected
                  shall be credited to, or recovered from, the Pool in the month
                  following the date of the auditor's report.

      (h)   "PAC" or "Producer Approved Costs" means any costs which Buyer's
            Producer Pool has approved for inclusion in the calculation of the
            monthly Netback Price through a producer vote conducted pursuant to
            Section 10.05. These costs are intended to cover extraordinary items
            which are not included in Buyer's FFS and may include the following:

            (i)   costs of arbitration under a Pool Approved Sales Contract or
                  under a gas purchase contract(s),

            (ii)  expenses associated with litigating a regulatory decision or
                  process or a Pool Approved Sales Contract issue,
<PAGE>
                                    - 18 -

            (iii) any transportation costs or other transportation related
                  expenses which are not included within Transportation Costs, 
                  and

            (iv)  any other extraordinary costs which Buyer may submit to the
                  Pool for inclusion in this category.

      (i)   "TGS" or "Total Gas Sold" means the total quantity of gas sold,
            including fuel, by Buyer pursuant to all Pool Approved Sales
            Contracts in the month in question.

10.03 RENEGOTIATION RIGHTS

      (a)   Buyer shall have the right to propose changes to the FFS component 
            of the Netback Price Clause for Seller's approval and the approval
            of all other Sellers in Buyer's Producer Pool by way of a producer
            vote to be effective for the contract year commencing November 1,
            2000 and every second contract year thereafter. If Buyer wishes to
            exercise this right, Buyer shall deliver a notice containing Buyer's
            new proposal to all Sellers in Buyer's Producer Pool by the June 1st
            preceding the November 1st on which the new proposal is to be
            effective. If Buyer's proposal is not accepted by the Pool, Buyer
            shall make a second proposal to the Pool. If the second proposal is
            not accepted by the Pool, Buyer may submit the matter to arbitration
            pursuant to Section 10.06 or, alternatively, may elect to have an
            independent third party determine Buyer's Cost of Service in the
            same manner as the APMC did in the period prior to November 1, 1997,
            with the additional mandate to determine and implement an
            appropriate mechanism for establishing Buyer's return. Buyer shall
            seek the approval of the Pool for the independent third party. If
            the Pool approves the independent third party, the Netback Price
            Clause shall be deemed to be amended to incorporate the independent
            third party's determination of Buyer's Fee For Service in place of
            the Fee For Service defined in Section 10.02 (c).

      (b)   Seller may request a change to the FFS component of the Netback
            Price Clause to be effective for the contract year commencing
            November 1, 2000
<PAGE>
                                    - 19 -

            and every second contract year thereafter. Seller must deliver its
            notice requesting such change no later than the June 1st preceding
            the November 1st in question. If Buyer receives notice from Sellers
            representing more than 30% of the volumes in Buyer's Producer Pool,
            Buyer shall conduct a producer vote to determine if there is
            sufficient support for a change in the agreement. If the Pool votes
            in favour of an amendment, Buyer shall submit a new Netback Pricing
            proposal to the Pool within 30 days. If this proposal is not
            accepted, the procedure outlined in subsection (a) above shall be
            followed.

      (c)   If Pool sales volumes increase by at least ten percent (10%) in any 
            contract year, or increase in aggregate by at least fifteen percent
            (15%) over any two successive contract years, Buyer shall have the
            right to seek a renegotiation of the FFS component of the Netback
            Price Clause effective on the November 1 immediately following the
            year or years in which the increase occurred by serving notice
            during the month of June prior to the end of such year(s). Buyer's
            notice may be sent based on the actual sales to June 1st in such
            year along with estimates for the sales for the remainder of such
            year. If Buyer exercises such right, the procedure outlined in
            subsection (a) above shall be followed.

      (d)   If NOVA changes its rate design from the current postage stamp
            methodology, Buyer shall have the right to seek a renegotiation of
            the Netback Price Clause. If Buyer exercises such right, the
            procedure outlined in subsection (a) above shall be followed.

      (e)   If the ARP is no longer published, Buyer shall have the right to
            substitute a replacement index which conveys the same information
            regarding natural gas prices in Alberta. If there is no such
            replacement index, Buyer shall propose an alternative index to
            Seller using the procedure outlined in subsection (a) above.

      (f)   Except for a replacement of the ARP pursuant to Section 10.03 (e)
            which shall be effective retroactively to the date the ARP or its
            replacement was no
<PAGE>
                                    - 20 -

            longer published, any redetermined Netback Price Clause shall be
            effective on the later of the November 1st following the date the
            renegotiation process was commenced or the first day of the month
            following the approval of Buyer's Producer Pool, the decision of the
            arbitrator(s) or the determination by the independent third party.
            Until such time, the previously existing Netback Price Clause shall
            remain in effect.

10.04       ANNUAL AUDIT

      (a)   By the April 30th following each contract year hereunder, Buyer
            shall provide to Seller an auditors' report which shall, for the
            just completed contract year:

            (i)   verify that Buyer's Operating Costs in the preceding contract
                  year were calculated in accordance with this Agreement and
                  properly deducted from Gas Sales Total Pool Revenue in
                  calculating the Netback Price,

            (ii)  verify the calculation of the return due to Buyer under the
                  IBR along with a reconciliation of the amount due with the
                  amount deducted by Buyer from the Netback Price during the
                  year,

            (iii) if Buyer claims that it was unable to sell gas at a load
                  factor of eighty percent (80%) as a result of a failure
                  to obtain producer support for sales, verify Buyer's
                  claim and verify that the Base Return and Incremental
                  Return were calculated in accordance with subsection
                  10.02 (g) (iii),

            (iv)  verify the amount of any PAC deductions from the netback
                  calculation and that the deductions were consistent with the
                  producer approval granted,

            (v)   verify the volume and price of any replacement gas purchased
                  to meet sales obligations when pool supply was not available,
<PAGE>
                                    - 21 -

            (vi)  verify that any adjustments made to Operating Costs pursuant
                  to subsections 10.02 (f) (iii) (A) and (B) have been
                  calculated in accordance with the provisions of this Article
                  X, and

            (vii) report on the number of Sellers, if any, who requested a
                  change to the Netback Price Clause in those years where
                  Sellers have such rights under the Contract.

      (b)   If the auditor's report indicates the Buyer either under-collected
            or over-collected any of the elements of the Fee For Service during
            the period audited, Buyer shall make adjustments to the Netback
            Price to compensate for the over or under collection.

      (c)   The auditor appointed by Buyer to prepare the report referred to
            above shall be approved by the Pool in a vote to be conducted
            pursuant to Section 10.05 hereof. Buyer shall submit a list of names
            of national accounting firms, who have indicated an interest in
            performing the audit, for the Pool to select from and the firm which
            receives the highest number of votes shall be retained.

10.05       PRODUCER VOTE MECHANISM FOR NETBACK PRICE CLAUSE

      (a)   If a producer vote is to be conducted under this Article X on a 
            revision to the Netback Price Clause, Buyer shall conduct the vote
            in accordance with the NATURAL GAS MARKETING ACT of Alberta, as
            amended or successor legislation ("NGMA"), provided however, that
            all pool producers shall participate in the vote as if they were
            Alberta producers. If the NGMA no longer provides for a producer
            vote process, Buyer must receive attain the support of at least
            fifty percent (50%) of those actually voting both by number and
            volume in order to pass a vote.

      (b)   The results of the vote shall be verified by the APMC or, if it is
            not available to perform this function, by the third party auditors.
<PAGE>
                                    - 22 -

      (c)   Buyer and Seller shall be bound by a finding of producer support
            whether verified by the APMC or the third party auditor.

10.06       ARBITRATION

      (a)   If Buyer submits a new Netback Price proposal to arbitration
            pursuant to Section 10.03 (a), an arbitration using a single
            arbitrator shall be conducted between Buyer and all Sellers in
            Buyer's Producer Pool. The arbitration shall be governed by the
            following principles:

            (i)   Buyer shall submit a list of at least three (3) potential 
                  arbitrators to the Pool for its approval. All arbitrators
                  submitted shall be knowledgeable with respect to the marketing
                  of Canadian natural gas and issues relating to the recovery of
                  costs by other buyers of gas in Western Canada performing
                  services substantially similar to the services performed by
                  Buyer hereunder. The arbitrator receiving more than fifty
                  percent (50%), by volume, of the votes cast shall be selected.
                  If no arbitrator receives the minimum amount of support, Buyer
                  may apply to the Court of Queen's Bench of Alberta to have a
                  single arbitrator appointed.

            (ii)  The arbitrator shall make all rules respecting the conduct of
                  the arbitration deemed necessary to ensure that all Sellers in
                  Buyer's Producer Pool have an opportunity to present their
                  views to the Arbitrator. The arbitrator may designate a
                  Seller, or group of Sellers, to act on behalf of the Pool.

            (iii) The arbitrator shall proceed expeditiously to hear and
                  determine the issues raised by the arbitration. The standard
                  for the arbitrator will be to decide on a cost recovery
                  mechanism which is comparable to the cost recovery of other
                  buyers of gas in Western Canada performing services
                  substantially similar to the services performed by Buyer
                  hereunder and shall provide a fair opportunity for Buyer to
                  earn a reasonable return.
<PAGE>
                                    - 23 -

            (iv)  The costs of any arbitration shall be passed through to the
                  Pool as an addition to Buyer's Operating Costs in the year in
                  which the arbitration occurs but shall not affect the level of
                  the Operating Costs in the following years.

            (v)   The decision of the arbitrator shall be delivered in writing
                  within ninety (90) days of the arbitrator's appointment. The
                  decision shall be final and binding upon the parties and shall
                  remain in effect until changed pursuant to Section 10.03
                  hereof.

10.07       SETTLEMENT PAYMENTS
      If Buyer receives a settlement payment from a purchaser under a Pool
Approved Sales Contract for the resale by Buyer of Pool gas, Buyer shall
distribute that payment to the Pool in an equitable manner having regard to all
the circumstances existing at the time. A settlement payment means any payment
by a repurchaser to Buyer in exchange for a release from future gas purchase
obligations under a Pool Approved Sales Contract, or other payments of a similar
nature. Settlement payments shall be distributed separately from payments for
gas and shall not form part of the Netback Price determined hereunder.

10.08       USE OF ESTIMATES FOR CALCULATING NETBACK PRICE

      (a)   Buyer shall have the right to use reasonable estimates of those
            costs, volumes and revenues for which actuals are not available, in
            order to calculate the Netback Price on a timely basis. Any
            adjustments or revisions for actuals shall be included in the
            netback calculation following the receipt of the actuals.

      (b)   In determining the cost of financing the Goods and Services Tax
            carrying costs, the costs of linepack and other financing charges,
            Buyer shall use the prime rate of interest as published by the Bank
            of Montreal for such month, plus one percent (1%).
<PAGE>
                                    - 24 -

10.09       BASIS OF PAYMENT

      (a)   The Netback Price payable for the gas purchased shall be expressed
            in Canadian dollars per gigajoule. The number of gigajoules shall be
            determined by multiplying the gross heating value by the volume
            delivered in thousands of cubic metres, both as determined in
            accordance with the measurement provisions of this Contract.

      (b)   Notwithstanding contrary provisions in this Contract, if a 
            transporting pipeline changes the basis or method of measurement,
            or, if in order to comply with or by reason of any present or future
            law, rule, regulation or order, of the Energy Utilities Board of the
            Province of Alberta or any other governmental authority having
            jurisdiction, now or during the term of this Contract, the basis or
            method of measurement of gas delivered is changed, then the price
            for gas purchased shall be adjusted to compensate for the change in
            the basis or method of measurement. Therefore, the total amount of
            money payable for quantities of gas purchased, according to the
            measurement provisions of this Contract, shall remain unaffected by
            this change in the basis or method of measurement.

      (c)   For greater certainty, the parties acknowledge that the price of gas
            sold to the Buyer calculated pursuant to the Contract is exclusive
            of Goods and Services Tax and the Buyer shall pay to the Seller, in
            addition to the payments calculated pursuant to this Contract, any
            Goods and Services Tax exigible on the sale of gas to the Buyer
            under this Contract and which taxes are required to be paid by Buyer
            and collected by the Seller and remitted to the Government of
            Canada. Seller shall provide Buyer with all of the information
            required by the Buyer to enable it to claim a refund of any Goods
            and Services Tax paid to the Seller.

10.10       RESALE PRICE ARBITRATION

      (a)   The gas sold under this Contract is acknowledged as being netback
            gas for the purposes of the NGMA and where the selling price or
            method for
<PAGE>
                                    - 25 -

            determining the selling price for gas in a resale contract between
            Buyer and one (1) of Buyer's sales customers has been determined by
            arbitration in accordance with the terms of the resale contract,
            Seller agrees to accept the resale price, or method for determining
            the price, determined by arbitration for the purposes of calculating
            the Netback Price under this Contract.

      (b)   In the event that the selling price or the method for determining
            the selling price for gas in a resale contract between Buyer and one
            (1) of Buyer's sales customers is to be determined by arbitration,
            Buyer, when seeking Sellers' approval for the inclusion of the costs
            of such arbitration as Producer Approved Costs, shall advise Seller
            of the arbitrator Buyer has selected to represent Buyer on the
            arbitration panel.

10.11       ENDORSEMENT OF PREVIOUS PRODUCER APPROVALS

      (a)   Seller accepts and endorses the terms and conditions of Pool
            Approved Sales Contracts which were approved prior to the effective
            date of this Contract.

      (b)   Sellers delivering gas to Buyer from lands situated outside the
            Province of Alberta accept and endorse the terms and conditions of
            Pool Approved Sales Contracts which are approved in the future by
            Alberta producers.

                      ARTICLE XI - BILLINGS AND PAYMENTS

11.01       BILLINGS AND PAYMENTS

      Seller, or Seller's nominee, shall provide Buyer by the fifteenth (15th)
day of each month ("Billing Month") or such later day as Buyer specifies in a
Split Allocation Form delivered to Seller, and confirm in writing, the quantity
and the energy content of gas delivered by Seller during the preceding month
("Sale Month").

      On or before the twentieth (20th) day of each Billing Month, Buyer will
provide Seller a written statement for the Sale Month showing the quantity and
the energy content of gas delivered by Seller, and the total amount payable by
Buyer. Buyer shall pay Seller
<PAGE>
                                    - 26 -

the amount payable for each Sale Month, on the twenty-fifth (25th) day of each
Billing Month, provided however, that if the twenty-fifth (25th) is not a
Business Day, payment shall be made on the next Business Day following the
twenty-fifth (25th). Each payment shall be made in Canadian funds to Seller in
Calgary, or at any other place in Canada, as Seller may designate by written
notice served by Seller on Buyer.

11.02       FAILURE TO PAY

      If Buyer fails to make payment to Seller when due, interest shall accrue
at an annual rate of interest which is equal to one percent (1%) above the
annual prime lending rate of the Canadian chartered bank used by Buyer, in
effect as of the date when such payment is due. Interest shall accrue until
payment is made. Payment shall not be due until the following month if Seller
fails to provide Buyer with the information required under Section 11.01 by the
date specified therein. If the failure to pay continues for fifteen (15) days,
Seller, in addition to all other remedies, may suspend deliveries of gas under
this Contract. If this failure continues for an additional fifteen (15) days,
Seller may, in addition to any other rights Seller may have, terminate this
Contract. However, in order for Seller to have the right to suspend deliveries
or terminate this Contract, Seller must first have notified Buyer in writing,
delivered by hand or courier, of its intent to do so five (5) days prior to
exercising either or both of such rights and must permit Buyer to pay the amount
due to Seller within this five (5) day period.

11.03       ERRORS AND ADJUSTMENTS
      Any errors discovered in any statement issued by Buyer shall be reported
and corrected promptly. If there is a discrepancy between the confirmation
provided to Buyer by Seller of the quantity and energy content of gas delivered
to Buyer in any month and the same information provided to Buyer by the
measuring pipeline at the Point of Delivery, payment shall be based on the
information provided by such pipeline. Buyer shall not be required to make
adjustments relating to the quantity of gas delivered after the earlier of
thirteen (13) months from the date of the statement or such earlier period which
may be adopted by the measuring pipeline at the Point of Delivery for the
processing of adjustments.
<PAGE>
                                    - 27 -

11.04  INSPECTION OF RECORDS
      Buyer and Seller shall have the right to inspect and examine at all
reasonable times the records and charts of the other party pertaining to the
purchase and sale of gas and, unless the parties otherwise agree, each party
shall preserve all charts and records for at least twenty four (24) months.

                   ARTICLE XII - LAWS AND REGULATORY BODIES

12.01       REGULATION

      The rights and obligations of Buyer and Seller under this Contract are
subject to all applicable present and future laws, rules, regulations and orders
of any legislative body or duly constituted authority.

12.02       LAW OF CONTRACT

      This Contract shall be construed and interpreted exclusively in accordance
with the laws of Alberta. The courts of Alberta shall have exclusive
jurisdiction in all matters contained here.

                         ARTICLE XIII - FORCE MAJEURE

13.01       FORCE MAJEURE DEFINED

      Subject to Section 13.02, Seller and Buyer will be relieved of those
obligations under this Contract which they are prevented from carrying out due
to, and to the extent of, a Force Majeure condition. Force Majeure conditions
are those events or conditions not caused by, and beyond the reasonable control
of, the affected party which prevent such party from carrying out all or a
portion of its obligations under this Contract. Force Majeure conditions do not
include financial impracticability or financial inability but includes, without
limitation: acts of God, war, insurrection or other unlawful acts against public
order or authority; explosions, fire, freezing or other accidents or acts of
sabotage causing breakage of or damage to machinery, lines of pipe or field and
delivery facilities, or temporary failure of gas supply; any acts or omissions
(including failure to take gas) of a purchaser of gas from Buyer which are
excused by an event or condition of Force Majeure; the interruption,
prorationing or curtailment of transportation service to Buyer or Buyer's market
for any reason, even if the transporter does not declare Force Majeure; the
inability to obtain or
<PAGE>
                                    - 28 -

maintain licenses or other necessary regulatory authorizations or where
continued performance would be in violation of an order, legislation, regulation
or similar direction of a government, board, agency or court having
jurisdiction, which has been resisted in good faith.

13.02       WHERE FORCE MAJEURE UNAVAILABLE
      Neither party shall be entitled to the benefit of Section 13.01 to the
extent that any of the following circumstances occur:

      (a)   the failure to perform obligations under the Contract was caused by
            the contributory negligence of the party claiming suspension;

      (b)   the failure was caused by the party claiming suspension having
            failed to remedy the Force Majeure condition and resume the
            performance of its obligations with reasonable dispatch;

      (c)   the failure was caused by lack of funds or with respect to the
            payment of any amount or amounts then due; and

      (d)   the non-performing party does not give notice and full particulars
            of the Force Majeure condition to the other as soon as possible
            after the occurrence of this condition.

13.03       NOTICE OF REMEDY
      The party claiming suspension of their obligations under this Contract
shall also give notice, as soon as possible after the Force Majeure condition is
remedied, that the condition has been remedied and that the party has resumed,
or is ready to resume, the performance of its obligations.

13.04       DISCRETION RE: LABOUR DISPUTES
      Notwithstanding anything to the contrary in this Article XIII, express or
implied, the parties agree that the settlement of strikes, lockouts and other
industrial disturbances shall be entirely within the discretion of the
particular party involved and that this party may make settlement at that time
and on those terms and conditions as it may deem to be
<PAGE>
                                    - 29 -

advisable and no delay in making this settlement shall deprive the party of the
benefit of Section 13.01.

13.05       ADJUSTMENT OF PURCHASE OBLIGATION
      If, during a contract year Buyer is unable to purchase gas from Seller due
to a Force Majeure condition ("Force Majeure Day"), the Purchase Obligation
shall be adjusted by subtracting the number of Force Majeure Days from the
number of days in the contract year when calculating the Adjusted Minimum Annual
Quantity in Section 4.02.

                        ARTICLE XIV - WARRANTY OF TITLE

14.01       WARRANTY OF TITLE
      Seller represents and warrants that it has full right and authority to
enter into this Contract, that all of the leases are in full force and effect
and are capable of being maintained and, subject to Section 3.01(a), will be
maintained by Seller in full force and effect pending commencement of and during
actual delivery of gas; that all gas committed and delivered is owned or
controlled by Seller free and clear of all liens, encumbrances and claims; that
Seller has the right to sell all of Seller's Reserves dedicated pursuant to
Section 15.01 for the duration of this Contract; that title to gas will pass to
Buyer free from all liens and adverse claims; and, that Seller is entitled to
drill for, produce or sell gas from Seller's Lands.

14.02       INDEMNITY
      Seller shall at all times have the obligation to make settlements for all
royalties and overriding royalties and payments to mineral and royalty owners
due now or subsequently under the leases, in accordance with those terms, and to
make settlements with all other persons having any ownership or interest in the
gas sold. Seller agrees to indemnify Buyer and to prevent Buyer from being
affected by any suits, actions, debts, accounts, damages, costs, losses and
expenses arising from adverse claims of any person to the gas or to royalties,
taxes, licence fees or charges which are applicable to the gas before the title
passes to Buyer or which may be levied and assessed upon the sale of the gas to
Buyer. In the event of any adverse claim of any character whatsoever being
asserted in respect to any of the gas, Buyer may retain, as security for the
performance of Seller's obligations
<PAGE>
                                    - 30 -

under this Section, the purchase price up to the amount of a claim until the
claim has been finally determined or until Seller has furnished a bond to Buyer
in the amount of the claim.

                     ARTICLE XV - GAS RESERVES OF SELLER

15.01       DEDICATION OF RESERVES

      Seller dedicates Seller's Lands and Seller's Reserves exclusively to the
performance of this Contract. In addition, subject to mutual agreement, Seller
may substitute lands and reserves to maintain the then existing DCQ provided the
reserves are of the same quality. Except as specifically provided otherwise,
Seller agrees to sell and deliver to Buyer all of Seller's interest in the gas
produced from Seller's Reserves. Seller shall notify Buyer of any change in
interest or ownership of Seller's Lands and Seller's Reserves. Seller shall not
dispose, cause, or allow a disposition, of any interest in Seller's Lands unless
the interest is made subject to this Contract and the assignee agrees to be
bound by the terms of this Contract.

15.02       FURNISHING OF INFORMATION

      Seller shall, from time to time, at Buyer's request, furnish to Buyer all
geological, geophysical, engineering and production data available to Seller
that may be required by Buyer to conduct a study of Seller's Reserves and
Deliverability under this Contract. This data shall include, but not be limited
to, drill stem tests, core analysis, sample logs, well logs, drilling and
completion reports, pressure data, production data and flow potential data on
all wells now or hereafter drilled on Seller's Lands. Buyer agrees to keep this
such data confidential if requested to do so by Seller.

                           ARTICLE XVI - ARBITRATION

16.01 Any controversy arising out of this Contract where arbitration is
expressly required under this Contract, and in any other case if the parties
both agree, shall be submitted to arbitration and the following principles shall
apply to this arbitration:

      (a)   Upon written demand by either party, the parties shall meet and
            attempt to appoint a single arbitrator. If the parties are unable to
            agree on a single arbitrator, then, upon written demand by either
            party and within ten (10)
<PAGE>
                                    - 31-

            days of this demand, each party shall name an arbitrator and the two
            (2) arbitrators shall promptly choose a third (3rd) arbitrator. If
            either party fails to name an arbitrator within ten (10) days of
            this demand, then the second (2nd) arbitrator shall be appointed by
            any Justice of the Court of Queen's Bench of Alberta. If the two (2)
            arbitrators shall fail within ten (10) days from their appointment
            to agree upon and appoint the third (3rd) arbitrator, then upon
            written application by either party, the third (3rd) arbitrator
            shall be appointed by any Justice of the Court of Queen's Bench of
            Alberta.

      (b)   The arbitrator or arbitrators shall proceed immediately to hear and 
            determine the question or questions in dispute. The decision of the
            single arbitrator shall be made within forty-five (45) days after
            that arbitrator's appointment, subject to any reasonable delay due
            to unforeseen circumstances. The decision of the arbitrators, or a
            majority of them, shall be made within forty-five (45) days after
            the appointment of the third (3rd) arbitrator, subject to any
            reasonable delay due to unforeseen circumstances. However, in the
            event the single arbitrator fails to make a decision within sixty
            (60) days after their appointment or if the arbitrators, (or a
            majority of them), fail to make a decision within sixty (60) days
            after the appointment of the third (3rd) arbitrator, then either
            party may elect to choose a new arbitrator or arbitrators as if none
            had previously been selected.

      (c)   The decision of the arbitrator or arbitrators (or a majority of
            them), shall be drawn up in writing and signed by the single
            arbitrator or by the arbitrators (or a majority of them) and shall
            be final and binding upon the parties on any question or questions
            submitted to arbitration. The parties agree to perform the terms and
            conditions of this decision.

      (d)   The compensation and expenses of a single arbitrator or a third
            (3rd) arbitrator shall be paid in equal portions by Buyer and
            Seller, and Buyer and Seller shall each pay the compensation and
            expenses of its named arbitrator when three (3) arbitrators are
            selected.
<PAGE>
                                    - 32-


                            ARTICLE XVII - NOTICES

17.01 Every notice, statement or bill provided for in this Contract shall be in
writing and delivered personally, by courier, first class mail, or facsimile to
such party's address as follows:

                  Seller:     Neutrino Resources Inc.
                              1400, 300 - 5th Avenue S.W.
                              Calgary, Alberta
                              T2P 3C4



                  Buyer:      ProGas Limited
                              3300, 400 Third Avenue S.W.
                              Calgary, Alberta
                              T2P 4H2


      Either party may change its address from time to time by giving written
notice of the change to the other party. Any notice, statement or bill or other
document delivered by mail shall be deemed to have been effectively delivered to
the addressee at the end of the fifth (5th) business day after the date of
mailing. Any notice, statement, bill or other document delivered by hand or
courier shall be deemed delivered when delivered to the addressee and confirmed
by record of the party making the delivery. In the case of a transmission by
telecopy or other similar means, delivery shall be when receipt has been
verified. Whenever possible, all notices shall first be delivered by telex,
telecopier or courier.

                             ARTICLE XVIII - OTHER

18.01       NON-WAIVER OF FUTURE DEFAULT
      No waiver by Buyer or Seller of any default by the other under this
Contract shall operate as a waiver of a future default, whether of a similar or
different character.
<PAGE>
                                    - 33 -

18.02       ASSIGNMENT
      This Contract shall bind and enure to the respective successors and
assigns of the parties, but no assignment shall release either party from its
obligations without the written consent of the other party which consent shall
not be unreasonably withheld. Nothing in this Contract shall prevent either
party from pledging or mortgaging its rights as security for its indebtedness.

18.03       HEADINGS
      The headings used in this Contract are inserted for reference purposes
only and are not to be considered or taken into account in construing the terms
or provisions of any Article and are not to be deemed in any way to modify,
explain or qualify the effect of any terms or provisions.

18.04       UNITS OF MEASUREMENT
      All units of measurement in this Contract are and shall be expressed in
the International System of Units (SI units). In some cases, Imperial units have
been indicated in parenthesis for reference purposes only. In the case of a
discrepancy between the indicated values, the SI units shall be taken as
correct.

18.05       NUMERICAL REFERENCES
      Unless the context otherwise requires, words importing the singular
include the plural and vice versa.

18.06       TIME OF ESSENCE
      Time shall be of the essence.

18.07       USAGE OR CUSTOM
      Words, phrases or expressions which are not defined and which have an
accepted meaning in the usage or custom of the business of exploration,
development, production, transportation, distribution or sale of gas shall have
that meaning.
<PAGE>
                                    - 34 -

18.08       SEVERANCE
      If any provision of this Contract shall be held invalid, illegal or
unenforceable to any extent and for any reason by a court of competent
jurisdiction, the remainder of this Contract shall not be affected and shall be
enforceable to the full extent permitted by law.

18.09       ENTIRE AGREEMENT
      The Contract shall be the entire agreement and there is no representation,
warranty, collateral agreement or condition affecting this Contract except as
expressed in it. Any amendment or modification shall be in writing executed by
the parties.

18.10       EXECUTION IN COUNTERPART
      This Contract may be executed in counterpart, no one copy of which need be
executed by all parties. When a counterpart has been executed by each of the
parties, all copies together shall constitute one agreement and shall be a valid
and binding agreement among the parties as of the day and year first written
above.

THEREFORE, the parties have executed this Gas Purchase Contract, effective as of
the date first written above.
                                    NEUTRINO RESOURCES INC.

                                    Per: /s/ DAVID BECKWERMERT

                                    Title: Executive Vice President


                                    Per:________________________________

                                    Title: _____________________________

                                    Date Executed:______________________



                                    PROGAS LIMITED

                                    Per:________________________________

                                    Title: _____________________________


                                    Per:________________________________

                                    Title: _____________________________

                                    Execution Date:_____________________

<PAGE>
                                    - 35 -


This page is the execution page to a Gas Purchase Contract dated November 1,
1997 between Neutrino Resources Inc. and ProGas Limited in the Pine
Creek/Windfall Area.
<PAGE>
                                     - 36 -


                                        SCHEDULE "X"

                Annualized ProGas Netback compared to Alberta Reference Price
<TABLE>
<CAPTION>
<S> <C>  <C>          <C>     <C>       <C>       <C>       <C>      <C>            <C>     <C>          <C>        <C>          <C>
L   Load Factor    Average  +Avg.-2%  +2%-4%    +4%-6%    +6%-8%    +8%-10%   +10%-12%    +12%-14%   +14%-16%    +16%-18%    18% &
    -%             =ARP                                                                                                      Above
O   97.6-100          3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
A   95.1-97.5         3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
D   92.6-95           3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
    90.1-92.5         3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
F   87.6-90.0         3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
A   85.1-87.5         3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
C   82.6-85.0         3       3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
T   80.0-82.5     BASE        3.1       3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
                  REVENUE
O   77.6-79.9                           3.2       3.3       3.5      3.75           4       4.25         4.5        4.75         5
R   Below 77.6                                              3.5      3.75           4       4.25         4.5        4.75         5
                    PRICE           
</TABLE>
<PAGE>
                                       1

                                 EXHIBIT "A"


To a Gas Purchase Contract made as of the ____ day of ___________________,
19______, between , as "Seller", and ProGas Limited, as "Buyer" in the Area.

--------------------------------------------------------------------------------

Seller owns or controls in the stated percentage interest(s) in the following
described lands and zones in the Area in the Province of Alberta:

--------------------------------------------------------------------------------

LEGAL DESCRIPTION                   ZONE(S)           SELLER'S INTERESTS
-----------------                   -------           ------------------

Township 057, Range 18, W5M
                              All Zones to Base             90.5794%     
                             of Bluesky-Bullhead
All of Section 15

Township 057, Range 18, W5M
                              All Zones to Base             37.6343%
                             of Bluesky-Bullhead
All of Section 16
<PAGE>                        
                                 EXHIBIT "B"

To a Gas Purchase Contract made as of the 1st day of November, 1997, between
Neutrino Resources Inc., as "Seller", and ProGas Limited, as "Buyer" in the Pine
Creek/Windfall area.


     FIELD        Receipt Point   Target Date of First    Initial          DCQ
                                       Delivery        Deliverability    103M3/D
                                                          103m3/d
Pine Creek/
Windfall          Edson #1064     November 1, 1997         115.0          115.0
================  ==============  =================== ================ =========


Aggregate DCQ as at November 1, 1997 =115.0 103m3/d




Exhibit "B" as at November 1, 1997