---

Exhibit 4.189


D- 11.8.1Layman Agree.P&S Geo Res.12-16-04 LEA Geo ResSaleAgrmnt Rev3 LEA+MJresponse 13 Dec'04 AGREEMENT FOR SALE AND PURCHASE OFGEOTHERMAL RESOURCE INTERESTS THIS AGREEMENT FOR SALE ANDPURCHASE OFGEOTHERMAL RESOURCESINTERESTS("Agreement'')isenteredinto asofthis 16th day of December,2004, between Layman Energy Associates,Inc.,a California corporation ("LEA"), andIcelandAmerica Energy, LLC, a Californialimited liability company ("IAE"). The partiestothisAgreement arehereaftersometimes collectivelyreferredto asthe"Parties." RECITAL A. LEAisa geological consultingfirm headquartered in San Luis Obispo,California which specializesin providinggeothermalresource characterization and othergeological services to the geothermalpower industry. B. ENEX hf ("ENEX")isa geothermal andhydropower developmentcompany with its principal officeslocated in Reykjavik,Iceland. C. IAE is a newly-formed geothermal powerdevelopmentcompany, of which ENEX is the major equityparticipant,withits principalofficeslocated inLosAngeles,California. D. LEAhasstudiedtheavailable geologicalinformationandhasperformed extensive surface exploration of aportionofthegeothermal reservoirlocated nearTruckhaven, California (the"Truckhaven ResourceArea")for thepast several years, andhasproceeded with efforts to acquire aleaseholdposition covering aportionoftheTruckhavenResourceArea. LEA's leasing efforts todateinclude: (1)Entering into an "Agreementfor theExclusiveRight toNegotiate a Geothermal Lease" and several addenda thereto with SFPacific Properties,Inc.(the"SFPacific Agreement"), which owns certain subsurface rights(including the geothermal resource interests)inthree separateparcels of real property, totalingapproximately1920acres,locatedin Sections1,3 and 6 of Township 11S,Range9E,ImperialCounty, California, withintheTruckhavenResourceArea; (2) Filing anon-competitivegeothermal resourceleaseapplication with the Bureau of Land Management of the U.S.Departmentof Interior ("BLM"), covering approximately 1240 acres,locatedin Sections 2 and12of Township11S,Range9E, Imperial County, California, within the Truckhaven Resource Area ; and (3) Filing an application for ageothermalprospecting permit with the California State Lands Commission ("CLC") covering approximately1920acreslocatedin Sections 34, 35 and 36 of Township10S, Range9E,ImperialCounty, California, within the TruckhavenResourceArea. The SIFPacificAgreement, BLM lease application and CLC geothermal prospectingpermitapplication arehereaftercollectively referred to as the "Lease Applications." Page1


---

D - 11.B.1 Layman Agree.P&S Geo Res.12-16-04 LEA Geo ResSaleAgrmnt Rev3LEA+MJresponse13Dec'04 E.On or about September 1,2004,LEA and ENEXenteredintoaMemorandumof Understanding("MOU") which providesfor,amongother things,the use of the LeaseApplications andthegeothermalresourcedataLEA has assembledregarding the Truckhaven Resource Area (the"ResourceData") for use in responding toaRequest for Proposals issued bythe Los AngelesDepartmentofWaterandPower ("LADWP") onor aboutJune30, 2004 (the "RFP").The RFP requested proposalsfrominterestedparties to develop renewableenergyprojects(including geothermal) withinthesouthernpathof the CaliforniaIndependentSystemOperator,or elsewhere, andtosellthe powergeneratedfromeach suchproject to LADWP pursuant totheprovisionsof along-termPowerPurchaseAgreement (the "PPA"). F.ENEX,with the approval and consent ofLEA, responded totheRFP throughits newly-formed affiliate,TAE,onSeptember13,2004.The proposalsubmittedby IAEin responseto the RFP (the"Proposal") offeredto develop,own andoperatea 40 MW geothermalpower project in thearea ofthe LeaseApplicationsinthe TruckhavenResourceArea,including thewellfieldandthe transmission line from the power plant to theelectrical grid, andtosell thepowergeneratedby theproject at setrates foraterm of20 yearsbeginningonJanuary1,2008, or at suchlater dateasprovided for by the PPA (the LADWP"Project"). G.Inadditiontostudying andevaluating the Truckhaven ResourceArea forthepast several years, andpar1icularly thearea coveredby thelease Applications(the"LEAResourceArea"),LEA has applied for andreceivedtentativeapproval for twogeothermalresourceexploration grantsrelatedto the LEAResourceArea, onefrom theU.S.Departmentof Energy ("DOE")under the GeothermalResourceExploration andDefinition (GRED U) program,Contract No.DE-FC36-02AL68296 (the"DOE Grant", andtheother fromtheCalifornia Energy Commission,under theCECGeothermal Resource Development Account(GRDA)Program(the "CEC Grant"), for a combinedtotalof $11,400.000.00ingrant funding to beusedprincipally to supportthe developmentanddrillingof an exploratory slimholeat a specified locationin the LEA ResourceArea. TheDOE Grant and theCEC Grant arehereaftersometimes collectivelyreferred toas the "Grants." 
Asnowwritten,each oftheGrantsrequiresLEAtoshare aportion of thecost of funding the Grants,eitherincash or inprofessionalservices andmaterials ofequivalent value. The Grants arc expectedto be finalizedbynot later than June1,2005. Uponfinalapproval of the Grants, Grant f-unds provided byCEC andDOEare anticipatedtosatisfythe respective matchingfundsrequirementsfor each agency,obviatingtheneedfora[directcost-share contribution from LEA. II.TheParties nowwishtocn erintoadertnitiveagreement,which supercedes the MOU and gives contractual substanceto the new busin'essrelationship that has developedamong thePartiessincetheexecution of the MOU. AGREEMENiT NOW,THEREFORE, inconsideration oftherrlutualpromises hereincontained, thePartiesagree asfollows: Page2


---

D- 11.8.1 Layman Agree. P&S Geo Res.12-16-04 LEA Geo Res Sale Agrmnt Rev3LEA+MJ response 13 Dec’04 1.Sale and Assignment of Lease Applications.Subjectto the furtherterms of this Agreement, LEA agreestosell,assignandtransfer toIAE,to thefullestextent permittedby statute,regulation and/or applicablereal propertylaw,allof the LeaseApplications for the consideration specifiedin paragraph 5 below. Tothe extentone or moreofthe LeaseApplicationsisinchoate, ornot otherwiselegally assignable,LEA agrees tocooperate with IAE in either (i) processing such Lease Applicationstocompletion, suchthattheleaseholdinterestinthe geothermal resourcesrepresented therby thencanbe lawfullyassigned toIAE,or (ii) takingsuch other steps and measures as arereasoinably necessarytoallowIAE tosecure good andmarketable leasehold titleto the geothermal resourceinterestsrepresented by such Lease Applications,includingbutnot limitedto, cooperating with and assisting IAEin thenegotiation of a definitive geothermalresource leasewith SFPacifiContermsacceptabletoIAE, filing one or more amended Lease Applicationsnaming IAEas the applicant orjointapplicant and owner or joint owner of rights createdunder therefiled Lease Applications and/or withdrawing one or more of the Lease Applications withBLMand/or CLC, and allowingIAE tosimultaneously filenewleaseapplications toreplace thewithdrawn applications. Inany event,LEAwill cooperate to the fullest extentpossible inassistingIAEtoassumeandtake overthe leaseholdinterests or expectancies LEAnowowns and controls,pursuantto theLease Applications; provided,however, LEA shall beunder noobligation toincuranyadditionalout-of-pocketcosts or expenses associated with assigning or otherwisetransferringtheLeaseApplications to IAE,or in further processing or pursuingtheLease Applicationsto conclusion asdescribedin subparts (i) and (ii) above. 2.Transfer of GeothermalResource Data.LEAwill deliver to IAEcomplete,legiblecopies of all of theResearch Data thatLEAhascollected, assembled,preparedand/or created relating to the TruckhavenResource Area as of the "EffectiveDate"of this Agreement (as defined inparagraph14below). The ResourceDataas furtherdefined in thisparagraphincludes,but isnotlimited to,allleaseapplications, agreements,lettersofintent,maps,surveys, reports,studies,test results,measurements,samples,photographs,video tapes,audio recordings,digital files,and otherinformation, regardlessof formorcontent,relating inwhole orinpart to the LEA and TruckhavenResourceAreas,and LEA's effortstostudy,evaluate,and acquireleasehold or otherinterestswithin the Truckhaven ResourceAreaduring thepast several years.All ResourceDatawhich LEA considers tobe proprietary,which isnot otherwisein the public domain,shallbe marked"ConfidentialInformation"andshallnot be disclosed byIAE to third parties except for the purposes authorizedbythisAgreement orpursuant to governmentalregulationsor administrative or court order. 3.Utilization of Grants. LEA agreesto use its"best efforts"tofinalizethepending grant applications it has with DOE and CEC,and tothereafterperformall required conditions of the Grants, with technical assistance and oversight from IAE,asmoreparticularly specified below and ashereafteragreed tobetween LEAandIAE,inaprofessionaland workman-like manner,and to share alldocumentsand res.earch informationprodu.ccd or assembled duringtheperformance of the Grants as soon as such informationis madeavailable or created by LEA.Except as provided for in paragraph 7, LEA will assume andmaintain day-to-daycontrol of all research,drilling,testing,reporting and otheractivitiesrequiredtobe.performed. under each of the Grants (the “Grant Requirements” ),butwill consult with and advisethe Designated Page3


---

D- 11.8.1 Layman Agree. P&S Geo Res.12-16-04 LEAGeoResSale Agrmnt Rcv3LEA'MJresponse13 Dec’04 Representative of IAE (as identified in paragraph16below) in writing, on a monthly basis, (and more frequently if requested by IAE based on unforeseen developments which might affect LEA's performance obligations or IAE's credit support·under either of the Grants),with respect to LEA's progress insatisfyingthe GrantRequirements,schedulingof future efforts and activities (including one-week, four-week,and three-noonth "look-ahead" schedules), budgetedandactual expenditures, and anticipated future expenditures, delays or anticipated delays, disputes with subcontractors and suppliers, and other matters hereafter deemed of importance by either of the Parties.I 4.Cooperation in Securing PPA. In addition to the obligations imposed under Paragraphs 1, 2 and 3 above, LEA shall cooperate fully with IAE's continuing efforts to (i) obtainaPPA from LADWP and any other creditworthy power purchaser who may be willing to enter into a financeable, long-term power purchase agreement with IAE ("Alternate Power Purchaser"), (ii) secure all permits and authorizations requiredto proceed with further definition and evaluation of the LEA Resource Area (including obligations imposed under the Grants),and(iii)secure,in the name of IAE or a special purpose entity created for the purpose of developinga geothermalpower project located in the Truckhaven Reource Area (the"Development Entity"), eachof the Lease Applications and any additional geothermal resource leases,easements,rights of way,surfaceleases, environmental studies,surveys,tests, investigations, measurements or reports as may be reasonably required or useful in the pursuit of the development of ageothermalpower project in the Truckhaven Resource Area;provided, however,LEAshallbe under no obligation, after the Effective Date of this Agreement, to incuradditionalout-of-pocketexpensesor financial commitments in the pcrformance of its obligationsUnder this Agreement. 5.Compensation to LEA. As·payment for the faithful and timely performance of LEA's obligations under this Agreement,LEAshall receivecompensation as follows: (a)Commissioning Payment. Upon the close of debt financing for the construction ofa geothermalpower project which utilizes geothermal resources produced from the Truckhaven Resource Area and the LADWP PPA or an Alternate PPA (as defined in paragraph 5b below), LEA shall be entitled to receive from the proceeds of the construction financing a lump sum payment equ al to $7000.00 per MW of the design capacity or nameplate rating of the power plant to be constructedwithinthe Truckhaven Resource Area, and an additional $7000.00 periMw of installed capacity ifand whenconstruction of thegeothermalpower project is1completed and passes all commissioning tests required under the LADWP PPA,or similar tests under any power purchaseagreemententered into between an Alternate Power Purchaser and IAE (the"AlternatePPA"). The contingent paymentsdueLEA under this subparagraph 5(a) are hereafter collectively referred to as the "Commissioning/Payment." (b)Overiding Royalty.One-half of one percent (.5%) of thegross saleproceedsfromthe sale ofelectricalpowergeneratedby the LADWP Project or any othergeothermalpower project developed by lAE orthe Development Entity within the Page 4


---

D- 11.8.1 Layman Agree.P&S Geo Res. 12-16-04 LEA Geo ResSale Agrmnt Rev3 LEA+MJresponse 13Dec’04 Truckhaven Resource Area (the "Alternate Project"),which is attributablein whole or partto the use of the LEA Resource for productionorinjectionoperations and/orreservoir pressuresupport,to be paid to LEA asapercentage ofthe gross saleproceeds not later then 10 days after receipt ofsuchproceeds from the utility buyer; provided however,the maximum "overridingroyalty" payable to LEA under thissubparagraph (b), plustheCommissioningPaymentprovidedfor insubparagraph (a) above, shall not collectively exceed $2,000,000.00'overthe lifetime of the LADWP Projectand/or any AlternateProject that may be deveilopedatthe Truckhaven ResourceArea.. The overriding royalty shallbesubordinated onlyto the permanentortake-outfinancing for theProject,and any preferred allocations of profits ortax benefits toequityparticipants inthe Project otherthan IAEorthe DevelopmentEntity. (c)GrantCompensation.All compensation for professionalservices,reimbursement of expenses, general andadministrativeexpenses andthe like payableto LEAunderthe Grants,and any amendmentsthereto,afterpaymentofallexpenses ofperformingthe GrantRequirements,includingsubcontractor payments,material costs,subsistence, permits and other costs ofperformance;provided however,LEA shallonly beentitledtosuch compensation andreimbursementof expenses frompaymentsactuallymadeunder the Grants,and,tothe extentIAE has provided1credit supportas providedfor inparagraph7below,ontheconditionthat LEA timely performs itsobligationsto IAEunderparagraph3 above. LEA shall remain solely liable for reimbursementfor any overpayments orimproper payments made to LEA under the Grants.LEA shall furtherindemnifyandhold IAE harmlessfromalllosses, expenses,judgments,claims orliabilitiesarising out of LEA'sfailure to performordefective performanceof the GrantRequirements.I (d)Project Relocation PaymentIf IAEchooses, in its sole discretion, to developa gcothermalpower projectat alocationother than theTruckhaven ResourceAreautilizingthe LADWPPPA(assuming LADWP allows theuse of the PPAat another geothermal resourcelocation),or an AlternatePPA, LEAshallreceivea singlelumpsum payment equal to 67% of the CommissioningPayment thatwould otherwise bedueLEA under subparagraph (a) aboveif theLADWPProject or anAlternateProject hadbeen successfullydevelopedattheTruckhavenResource Area, to bepaidtoLEA from the proceeds ofthe permanentortake-out financingforsuch otherproject in lieuof the paymentsprovided for insubparagraphs (a) an(b) of this paragraph.Such alternative payment,ifany,shallbe conditioned uponLEA'sfull cooperation inany effort IEA may undertake tomovetheLADWP PPAor any AlternatePPAto alocationother thantheTruckhavenResourceArea, and thetimely performanceofLEA'sobligations under the other provisions ofthisAgreement. If IAE succeedsinobtaining apowerpurchase agreement based onits planned useof some or all of theLEA ResourceArea andthen determines,initssolediscretion, not to developeitherthe LADWP Projector an AlternateProjectat alocationotherthanthe TruckhavenResourceArea,LEA shall havetheoption,but not theobligation, ofreceiving anassignmentof the LADWP PPAor the AlternatePPA,as the casemay be,fromIAE (totheextentLADWPortheAlternate PowerPurchaserwill permit suchanassignment)upon payment to IAEof 67%of the Page5


---

D- 11.8.1 Layman Agree. P&S Geo Res.12-16-04 LEAGeoResSaleAgrmntRev3LEA+MJresponse 13 Dec'04 Commissioning Payment that would otherwise be payable to LEA under subparagraph (a) above if the LADWP Project oran Alternate Project had been successfully developed at the Truckhaven Resource Area. If LEA fails to exercise the option granted hereunder or to pay the required 67% of the Commissioning Payment to IAE within 6 (six) months of the date IAE notifies LEA in writing that it no longer wishes to develop a power project utilizing the LADWP PPA or the Alternate PPA,the option shall expire and IAE may sell,assign or seek cancellation of the PPAas it sees fit. 6.Re-Assignment of Lease Applications to LEA.If, after the Effective Date of this Agreement, IAE determines,in its sole discretion, that due to geothermal resource considerations,permitting or environmental concerns, PPA limitations or constraints,financing considerations,market changes or other circumstanceslof whatever nature or severity,IAE no longer wishes to proceed with the develop:mcnt of the project in the Truckhaven Resource Area or to utilize any portion of the LEA Resource Area in the development of the Project, IAE shall notifyLEA of such decision in writing, and shall thereafter reassign or cause the reassignment to LEA,of all of IAE'sor the DevelopmentEntity's right, title and interest in and to the Lease Applications then existing, and return to LEA all Confidential Information it received from LEA with respect to the Project,after which transfers IAE shall be relieved of all further liability or obligation to LEA under this Agreement and any other supplemental or collateral agreements relating hereto, except any credit support IAE may have provided to or on behalf of LEA pursuant to the provisions of paragraph7of this Agreement and the obligation to assign the LADWP PPA or the Alternate PPA,if anyexists,to LEA in accordance with the provisions of paragraph 5(d) above; provided however, if IAE later develops the Project in the Truckhaven Resource Area,the reassignment of the Lease Applications to LEA pursuant to this paragraph will not affect IAE's obligation to pay LEA the Commissioning Payment and any other compensation it is entitled to receive underparagraph 5 of this Agreement. LEA agrees to assume full responsibility and liability for.all other agreements and obligations relating to the development of the Project to which it is a joint party or has consented to in writing, following the reassignment of the Lease Applicationsand delivery of the Confidential Information to LEA. The re-assignment of the Lease Applications to LEA will take place only if LEA agrees in writing to accept such re-assignment from IAE. 7.IAE Financial Supp01i for Grants.Commencing upon the date of this Agreement,IAE will conduct a detailed investigation of the proposed drilling and testing program and budget for the Grants as submitted byLEA to DOE and CEC, and review the drilling history for the Truckhaven-1 well which is to be provided to IAE under paragraph2of this Agreement. Based on the.results of hisinvestigation,IAE will determinelwhether IAE is prepared to commit to providing financial support to the Grant program. IAE will, no later than 60 days from the date of this Agreement,provide written notice to LEA of its commitment to provide financial support for the Grant program,with such notice sp1ecifically stating that IAE will:provide credit support for contracting activities under the Grant as required; pay for reasonable,directly-related project costs not covered by the Grants,including any matching fund requirements not met by offsetting Grant funds; and pay for project cost overruns above the final approved DOE/CEC budget amounts.If IAE fails to provide such written notice to LEA within 60 days of the date of this Page 6


---

D- 11.8.1 Layman Agree. P&S Geo Res.12-16-04 LEAGeo ResSale Agrmnt Rev3LEA+MJ response 13Dec'04 Agreement asdetailedabove,then LEA mayatitssoleoptionelecttoeither cancel ordelay indefinitely the implementationofthe Grant project.Should IAE elect to providefinancial support for the Grant program asdescribedabove,IAE.will retaintherighttoparticipate fully intheday-to-daymanagementofthe Grantprogram inclosecooperation with LEA. 8.OtherConsulting Assignments.IAE willhireLEAasageological andpermittingconsultant fortheLAWDPProject and anyAlternate Projectthat may be developedat the TruckhavenResourceAreabeginning not later than upon the normal expirationof LEA's consulting and otherresponsibilities under the Grantsorupon determination thatGrant funds willneither beavailablenorappliedto the Grant project,whichever comesfirst,andupon termsand conditionsmutuallyacceptableto both Parties, but withan expectedlevelof effort by LEA sufficient to generate consultingfeesof atleast $3000.00 per monthsolongasIAEis actively pursuingdevelopmentof a geothermalpower project atthe Truckhaven ResourceArea. 9.RepresentationsandWarranties by LEA.LEArepresentsand wanants toIAE(withthe understandingthatIAE is relying uponsuch representations and warranties in entering into this Agreement),as oftheEffective Date andthe,”ClosingDate" (as defined inparagraph11below) as follows: (a)Organization. LEAis afor profitcompany dulyorganized, validly existing and in good standingunderthelawsof California. (b)Authority. The execution, delivery andperformancebyLEA of this Agreementdoesnot and willnotconflict with,ior result in, the breachorterminationof any provision of, or constitute adefault under, any indenture, mortgage, deedoftrust, lease,contract,security agreement or other instrumentoragreement,or any order,judgment,award or decree to which LEAissubjector bywhichtheLease Applications orthe Resource Data may bebound, orresult in the creationof alien, chargeor encumbrance upon any such properties or expectancies. (c)Consent. LEAhas the full right, powerand authorityto perform itsobligationsunder thisAgreement, andtosell and assign,or otherwise transfer theLease Applications and theResource Data to IAEwithoutfirstobtainingthe consentor approval of any governmental authority or anyother person or entityto whichLEAortheLease Applications andResource Data may be subject, andnootherpersonor entity (other than ENEX and LEA)hasany righttopossession o the LeaseApplicationsandResourceData, or anyrightor optiontoacquirethesamefrom LEA. (d)Ownershipof Lease Applicationsand ResourceData. LEAowns all right,titleandinterest inand to the Lease Applicationsanthe Resource Data,and has not sold, assigned,encumbered or otherwise transferred any interest inone or more of the Lease Applications or theResource Data toanythird parties,norisLEAaware of any adverse claims,liens,encumbrances or otherdefectsaffectingitsownership of each of the Lease Applications and theResource Data, otherthanllimitationsof ownership and other contingencies createdby thestatutes, regulations,guidelines andproceduresgoverning Page 7


---

0 - 11.8.1 Layman Agree. P&S Geo Res. 12-16-04 LEA GeoResSale Agrmnt Rev3LEA+MJ response13f ec'04 the geothermal resource leasing process as it relates to the BLM and CLC Lease Applications, and as set forth in the SF Pacific Agreement. (e)Performance of Obligations Under Lease Applications.LEA has performed all obligations imposed upon it under each of the Lease Applications as of the Effective Date, and all of the Lease Applications are in good standing and not subject to rejection,suspensionor cancellation due to the failure of.any term or condition thereof, including the payment of required fees, assessments and/or costs related thereto. (f)Confidential Information.LEA has not divulged any Confidential Information to third parties prior to the effectivedateof this agreement,without first requiring the execution of a confidentiality, nondisclosure or similar form of agreement which prohibits the unauthorized use of such Confidential Information without the consent of LEA. (g)Liabilities. There are no liabilities or obligations related to any of the Lease Applicationsorthe Resource Datatwhich LEA is obligated to satisfy on or before the Closing Date, or any such liabilities and allegations which IAE may be obligated tosatisfyafter the Closing Date, otherthan as set forth in the SF Pacific Agreement and the statutes, regulations, rules and procedures governing the processing of such Lease Applicationsandissuance of the leases to which they relate. (h)Hazardous Waste. To the best knowledge of LEA, none of the properties covered by the Lease Applications are in violation of federal, state or local law, ordinance or regulation relating to hazardous substances or petroleum byproducts, and to the best knowledge of LEA, there have been no disposals, releases, or threatened releases of hazardoussubstancesor petroleum by products, on, from or under any of the properties covered by the Lease Applications, including the ImperialCounty landfill which is located on a portion of the LEA Resource Area. (i)The Resource Data. LEA is required to deliver to IAE on the Effective Dateconstitutes virtuallyall o.f the Resource Data that.has been collected by or on behalf of LEA from theinceptionof its involvement with the Truckhaven Resource Area to the present. To the best of LEA's knowledge, the Resource Data is of good quality and was obtained from reputable public and private sources. I0. Representations and Warranties of IAE.represents and warrants to LEA (with the h understanding that LEA is relying uponsuch representationsand warranties in entering into this Agreement),as of the Effective Date and the “Closing Date" (as defined in paragraph11below) as follows: (a)Organization. IAE is a limited liability company duly organized,validly existing and in goodstandingunder the laws of California. (b)Authority. The execution,delivery,andlperformance by IAE of this Agreement does notandwill not conflict with,,or result in, the breach or termination ofanyprovision Page 8


---

D- 11.8.1 LaymanAgree.P&SGeo Res.12-16-04 LEAGeoResSaleAgrmnt Rev3LEA+MJ response 13 Dec’04 of, or constitute a default under,any indenture, mortgage, deed of trust, lease, contract,security agreement or other instrument or other agreement, or any order,judgment, award,or decree to which IEA is subject or by wh1ch it may be bound. (c) Consent. IAE has the full right, power and authority to perform this Agreement,without obtaining the consent or approval of any governmental authority, or any other person or entity to which IAE may,be subject. 11.Conditions to Closing.IAE shall be under no obligation to proceed with the purchase and acquisition the Lease Applications and Resource Data and performance of its other obligations under this Agreement until the following conditions are satisfied: (a)Documentation of Lease Applications and Resource Data. LEA has delivered to the Designated Representative of IAE legible copies of each of the signed Lease Applications showing the filing information,if available,and a detailed list of all documents which comprise the Resource Data. 12.Closing.The sale,assignment orother form of transfer of the Lease Applications and delivery of the Resource Data to IAE shall take place as soon as the conditions specified in paragraph 11 above are satisfied (or waived by IAE in writing), at which time IAE shall give written notice of its intent to proceed with1the acquisition of the Lease Applications and the Resource Data from LEA.The date for transferring the Lease Applications (in an assignment or other transfer acceptable to IAE) and delivering the Resource Data to IAE shall be set by mutual agreement of the Parties,but shall occur not later than 30 days from the date of this Agreement, unless extended by mutual agreement of the Parties (the "Closing Date"). 13. No Joint Venture.By entering intothis Agreement, the Parties do not intend nor shall they be deemed to have created a joint ven:ture or partnership among themselves. No party shall have the authority to contract for or otherwise obligate any other party to this Agreement, nor shall any party be authorized to act as agent or representatative for any other party without the express written authorization of that party. Each of the Parties shall be responsible for payment of its own employment taxesand other witholdings arising out of the performance of this Agreement and the Grant Requirements, and no employee, subcontractor, agent or attorney of one party shall be considered an employee,,subcontractor, agent or attorney of any other party., 14.Notices.All communications, contents and other notices provided for in this Agreement shall be in writing and shall be effective on the date handdelivered, sent by facsimile,or mailed by certified mail, return receipt requested,!postage prepaid, and addressed as follows: (i)

   If to LEA:Layman Energy Associates, Inc.1582Cordova DriveSan Luis Obispo, CA 93405Attention: Erik B. Layman
 or tosuch other address as LEA may hereafter designate in writing to IAE. Page 9


---

D- 11.8.1 Layman Agree.P&S Geo Res. 12-16-04 LEAGeoResSale AgrmntRcv3LEAt-MJ response13 Dec'04 (ii)

   If to IAE: c /oENEXLaugavegi178105 ReykjavikIcelandAttention: Magnus Johannesson
 or tosuchother address as IAE may hereafter designate in writing to LEA. 15.Cancellation of MOU. Upon theexecutionof his Agreement by all of the Parties, including the guarantor (the "Effective Date"), the MOU entered into between LEA and ENEXshallbesupercededand of no further force and effect, except as may be required to support ENEX/IAE's proposal to LADWP to develop the Project, but in no event later than the Closing Date under this Agreement. After theClosingDate, ENEX shall have no further duties orobligationsunder the MOU,or any rightsiorinterestIunder this Agreement apart fromitsmembership interest in IAE. 16.Independent Advice. Each of the Parties has received independent legal advice regarding the interpretationandlegal consequencesofthis Agreement. No party is relying uponadviceprovided byanyother party or the attorneyfor any other party in choosing to enter into thisAgreement. Eachof the Parties shall be responsible for the payment of its own attorneys feesandexpenses related to the negotiation and preparation,of this Agreement. 17.Designated Representative of IAE.The Designated Representative for IAE, until further notice pursuant to paragraph13above, shallbe MagnusJohannesson. 18.Miscellaneous. In addition to the foregoing, the Parties to this Agreement agreeasfollows:I (a)Integration Clause. This Agreementconstitutes the entire agreement between the Parties pertainingtothe subject matter contained herein andsupersedesall prior and contemporaneousagreements,representations and understandings of some or all of the Parties with respect thereto. No supplement, modification or amendment of this Agreementshallbe binding unlessexecuted in writing by all of the Parties.No waiver shallbe binding unless executed, in writing, by the party making such waiver. (b)Counterpartsand Recitals. This Agreement may be executed by facsimile and in one or more counterparts, each ofwhichshall be deemed an original, butallof which togethershallconstitute one and the same instrument. The Recitals stated aboveshallbe and herebyareincorporated in andmade an integral part of this Agreement by reference. (c)Representatives, Successorsand Assigns.This Agreement shall be binding upon, andshallinure to the benefit of the Parties and their respective legal representatives,successors,and assigns. This Agreement, may be assigned to any affiliate of IAE or LEAwithnotice inwritingto the non-assigning party; provided however, the assigning party Page


---

D- 11.B.1 Layman Agree.P&S Geo Res. 12-16-04 LEA GeoRes SaleAgrmnt Rev3LEA+MJ responsel3Dec'04 (and the guarantor,to the extent applicable) shall remain obligated in the event its assignee fails or refuses to perform the remaining obligations of the assigning party under this Agreement. (d)Severability.In the event any provision ofthisAgreement shall be held invalid and unenforceable by a court of competent jurisdiction, such provision shall be severable from,and such invalidity and unenforceability shall not be construed to have any effect upon,the remainingprovisions of this Agreement. (c)Governing Law.This Agreement shall be governed by, and construed in accordance with,the laws of the State of California. IN WITNESS WHEREOF,the Parties have entered into this Agreement as of the date first written above. LAYMAN ENERGY ASSOCIATES, INC.

   ICELAND AMERICA ENERGY, LLC*/s/ Magnus Johannesson*By: */s/ Erik B. Layman*

   By: Magnus JohannessonIts: President

   Its: CEO Page 11


---