**Exhibit      10.8**

**FARMOUT      AGREEMENT**

**DEEP      WELL OIL & GAS, INC.**
**Deep      Well**
**NORTHERN      ALBERTA OIL LTD.**
**Northern**

**Farmor**

**SURGE      GLOBAL ENERGY (CANADA), LTD.**
**and      SURGE GLOBAL ENRGY INC. a Delaware corporation**
**Farmee**

**ARTICLE      1**

**INTERPRETATION**

| **1.1** | Each                capitalized term used in this Head Agreement will have the meaning                given                to it in the Farmout & Royalty Procedure and, in                addition: |
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|   | (a) | “**6.5                Section Block**”                means those lands designated as such in Schedule                “A”; |
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|   | (b) |  “**32                Section Block**”                means those lands designated as such in Schedule                “A”; |
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|   | (c) | “**31                Section Block**”                means those lands designated as such in Schedule                “A”; |
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|   | (d) | “**Assignment                Procedure**”                means the 1993 CAPL Assignment Procedure which will be deemed to                apply as                if it had been included as a separate schedule to this                Agreement; |
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|   | (e) | “**Assumption                of Liabilities and Indemnity Agreement**”                means agreement entitled Assumption of Liabilities and Indemnity                Agreement                dated as of February 18, 2005 pursuant to which Farmor undertakes                to be                solely responsible for the Nearshore ORR as it pertains to the Farmee’s                interests in the Farmout Lands and to indemnify and save Farmee harmless                from any and all claims and demands made by Nearshore Petroleum                Corporation (or any person claiming by, through or under it) in respect                of                the Nearshore ORR; |
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|   | (f) | “**Conditions                Satisfaction Date**”                means the date on which all conditions in Section 2.1 have been                satisfied; |
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|   | (g) | “**Contract                Depth**”                means, with respect to each well drilled by Farmee under this Agreement,                a                vertical wellbore to a depth sufficient to penetrate 15 meters into                the                top of the Wabamun formation or to a subsurface depth of 800 meters                whichever shall first occur, followed by a minimum 600 meter horizontal                wellbore within the Bluesky                Formation; |
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|   | (h) | “**Earning                Period**”                means a period of 24 months following the Conditions Satisfaction                Date; |
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|   | (i) | “**Effective                Date**”** **means                February 17, 2005; |
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|   | (j) | “**Encumbrances**”** **means                the royalty interests described under that heading in Schedule                “A”; |
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|   | (k) | “**Existing                32 Section Block JOA**”                means the Joint Operating Agreement made as of April 26, 2004 originally                between Northern Alberta Oil Ltd. (formerly Mikwec Energy Canada                Limited                by name change) having an 80% participating interest and Pan Orient                Energy                Ltd. (formerly Maxen Petroleum Inc. by name change) having a 20%                participating interest pertaining to the 32 Section                Block; |
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|   | (l) | “**Existing                31 Section Block JOA**”                means the Joint Operating Agreement made as of December 9th, 2004                among                Deep Well having an 80% participating interest, Pan Orient Energy                Ltd.                having a 10% participating interest (Execution Pending) and 1132559                Alberta Ltd. having a 10% participating interest (Executed) pertaining                to                the 31 Section Block; |
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|   | (m) | “**Existing                JOAs**”                means, collectively, the Existing 32 Section Block JOA and the Existing                31                Section Block JOA; |
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|   | (n) | “**Farmor’s                Pre-Farmout Working Interests**”                means the interests shown under that heading in Schedule                “A”; |
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|   | (o) | “**Farmout                Lands**”                means the lands shown under the heading Farmout Lands in Schedule“A”,                provided that the “Farmout Lands” shall not include the 6.5 Section Block                lands unless or until the Farmor acquires a legal or beneficial interest                in the Title Documents that comprise the 6.5 Section                Block; |
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|   | (p) | “**Farmout                & Royalty Procedure**”** **means                the 1997 CAPL Farmout & Royalty Procedure including the elections and                revisions thereof, which are attached to this Head Agreement as Schedule                “B”; |
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|   | (q) | “**Head                Agreement**”                means this Agreement other than the                Schedules; |
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|   | (r) | “**Mutual                Interest Lands**”                means any interest in any single parcel of petroleum and natural                gas                rights, oil sands leases, and oil sands permits where 50% or more                of that                parcel, by surface area, is within Townships 91 and 92, Ranges 12                and 13,                W5M; |
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|   | (s) | “**Nearshore                ORR**“                means the 6.5% overriding royalty granted to Nearshore Petroleum                Corporation under the Royalty Agreement dated December 12, 2003 originally                entered into between Mikwec Energy Canada Ltd. and Nearshore Petroleum                Corporation; |
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|   | (t) | “**Operating                Procedure**”** **means                the 1990 CAPL Operating Procedure together with the 1996 PASC Accounting                Procedure including the elections and revisions thereof, which are                attached to this Head Agreement as Schedule“C”; |
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|   | (u) | “**Operator**”                means Farmee; |
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|   | (v) | “**Parties**”                means Farmor and Farmee and “**Party**”                means either of them, as                applicable; |
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|   | (w) | “**Proved                Reserves**”                means estimated volumes of crude oil, crude bitumen, oil sands, natural                gas and gas condensates, liquids and associated substances which                are                expected to be retrieved from deposits and used commercially, at                the                economic and technical conditions applicable at the time and according                to                current legislation, and includes: |
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|   | (i) | proved                developed reserves, which are amounts of hydrocarbons that are expected                to                be retrieved through existing wells, facilities and operating methods;                and |
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|   | (ii) | undeveloped                proved reserves, which are amounts of hydrocarbons that are expected                to be                retrieved following new drilling, facilities and operating methods;                and |
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|   | (x) | “**Title                Documents**”** **means                the documents of title under the heading Title Documents described                in                Schedule “A” attached hereto. |
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| **1.2** | The                following Schedules are attached to, and made part of this                Agreement: |
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| Schedule                “A” - |   | Description                of the Farmout Lands, Farmor’s Pre-Farmout Working Interests, the Title                Documents and Encumbrances; |
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|                                      |   |                                                                                                                                                |
| Schedule                “B”   |   | Farmout                & Royalty Procedure elections and amendments;                                                                            |
|                                      |   |                                                                                                                                                |
| Schedule                “C”   |   | Operating                Procedure elections and amendments;                                                                                        |
|                                      |   |                                                                                                                                                |
| Schedule                15.1(f)           |   | Outstanding                Authorizations for Expenditure                                                                                           |
|                                      |   |                                                                                                                                                |
| Schedule                15.1(k)           |   | Areas                of Mutual Interest                                                                                                             |

**ARTICLE      2**

**CONDITIONS      PRECEDENT TO FARMEE’S OBLIGATIONS**

| **2.1** | Farmee’s                obligations under this Agreement shall commence once each of the                following                conditions precedent have been                satisfied: |
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|   | (a) | Farmor                having conveyed to Farmee a 40% undivided interest in the Title Documents                and Farmee having had transfers accepted for registration evidencing                Farmee as a registered lessee of a 40% undivided interest in each                of the                Title Documents, in each case free and clear of all royalties, burdens,                claims, encumbrances and other adverse interests of any nature or                kind                whatsoever, other than the                Encumbrances; |
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|   | (b) | (1)                Farmee shall have received a fully executed copy of the Assumption                of                Liabilities and Indemnity                Agreement; |
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|   | (c) | Farmor                shall use best efforts to obtain a fully executed copy of the Existing                31                Section Block JOA and the terms of such agreement and the parties                thereto                shall be satisfactory to Farmee, acting                reasonably; |
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|   | (d) | Farmee                shall have received a fully executed copy of an agreement between                Nearshore Petroleum Corporation and Northern terminating the                Non-Disclosure/Area of Exclusion Agreement dated November 19, 2003                between                those parties. |
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|   | (e) | Execution                of satisfactory Escrow Agreement and satisfactory evidence of completion                of Surge financing or sufficient funds to complete the drilling of                the                Test Well, as soon as practical following execution                hereof. |
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**ARTICLE      3**

**TEST      WELL**

| **3.1** | Farmee                shall, at its sole cost, risk and expense, and subject to having                obtained                a rig, all necessary surface access and Regulatory approvals, Spud                the                Test Well at a location of its choice on the Farmout Lands on or                before                150 days following the execution hereof and drill the Test Well to                Contract Depth. |
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| **3.2** | Subject                to Article 3.00 of the Farmout & Royalty Procedure and Article 20 of                this Agreement, Farmee will earn 50% of Farmor’s Pre-Farmout Working                Interest in the section of land on which the Test Well is situated                together with 50% of the Farmor’s Pre-Farmout Working Interest in 5                additional sections of the Farmout Lands which are selected by Farmee                not                later than 90 days following the completion or abandonment, as applicable,                of the Test Well. |
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**ARTICLE      4**

**OPTION      WELL**

| **4.1** | Within                60 days of rig release of the Test Well, Farmee shall have the right,                on                notice to Farmor, to elect to undertake the drilling of an Option                Well.                Farmee shall Spud the Option Well at a location selected by Farmee                and                Farmor acting reasonably on Farmout Lands not yet earned by Farmee                within                60 days of the date of the Farmee’s election notice (conditional upon rig                availability, Regulatory approvals and surface access). Farmee shall                continuously drill the Option Well to Contract                Depth. |
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| **4.2** | Subject                to Article 3.00 of the Farmout & Royalty Procedure and Article 20 of                this Agreement, Farmee will earn 50% of Farmor’s Pre-Farmout Working                Interest in the section of land on which the Option Well is situated                together with 50% of the Farmor’s Pre-Farmout Working Interest in 5                additional sections of the Farmout Lands which are selected by Farmee                and                Farmor, acting reasonably, not later than 90 days following the completion                or abandonment, as applicable, of the Option                Well. |
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**ARTICLE      5**

**ROLLING      OPTION TO DRILL**

| **5.1** | Farmee                shall have a continuous rolling option, during the Earning Period,                to                elect to drill additional Option Wells on the remaining unearned                Farmout                Lands in accordance with Article 4 hereof, until all of the Farmout                Lands                are earned or until Farmee’s right to further earning under this Agreement                is terminated. In respect of each Option Well which Farmee wishes                to                drill, Farmee must elect to drill the next Option Well by giving                notice to                Farmor within 90 days of rig release of the most recently drilled                Option                Well. All terms and conditions of this Agreement which apply to the                Option                Well shall apply, *mutatis                mutandis*,                to any additional Option Wells drilled by Farmee hereunder, provided                that                if Farmee drills a total of 8 Option Wells, it will have earned (to                that                point in time) a 40% undivided interest in 54 sections of the Farmout                Lands. Notwithstanding Section 4.2, if Farmee drills a 9th                Option Well, it will earn 50% of the Farmor’s Pre-Farmout Working Interest                in the 9.0 remaining sections (which were not earned by the drilling                of                the Test Well and the prior 8 Option                Wells). |
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**ARTICLE      6**

**EXISTING      JOAs AND OPERATIONS NOTICES**

| **6.1** | Promptly                following each determination by Farmee that it intends to drill a                well                under this Agreement, Farmor shall issue an operation notice (prepared                by                Farmee) pursuant to Article X (Independent Operations) of the applicable                Existing JOA and, thereafter, promptly advise Farmee whether either                or                both of the other Joint-Operators under the Existing JOA have elected                or                not elected (or are deemed to have elected or not elected) to participate                or not participate in the drilling of that well.                If: |
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|   | (a) | either                or both of such Joint-Operators are participating in the operation,                Farmor                shall provide all assistance requested by Farmee in respect of such                Joint-Operator(s) including, without limitation, (1) by electing                to                participate in the operation (in order that Farmee can share in any                participating interest of a non-participating party), and (2) by                issuing                and collecting cash calls for costs of operations (to the extent                of                Farmor’s rights under the applicable Existing JOA);                and |
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|   | (b) | either                or both of such Joint-Operators are not participating, Farmee will                be                required to pay the non-participant’s share of the cost of the operation                (to the extent not assumed by another participating party) and Farmee                shall be entitled to all benefits associated with such non-participation                including, without limitation, the right to receive the full amount                of the                penalty attributable to such non-participation in accordance with                Clause                1007 and the other provisions of the applicable Existing                JOA. |
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**ARTICLE      7**

**OPERATING      PROCEDURE**

| **7.1** | Upon                each occurrence of earning by Farmee in a 6 section block of Farmout                Lands                (and as between Farmor and Farmee), such Farmout Lands and the related                Title Documents (to the extend of such lands) will become subject                to the                Operating Procedure with Farmee being the initial Operator thereunder.                Subject to Section 7.2, the Operating Procedure will govern all future                joint operations of the Parties** **upon                or with respect to such earned Farmout Lands and Title                Documents. |
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| **7.2** | Upon                each occurrence of earning by Farmee in Farmout Lands governed by                an                Existing JOA, Farmor and Farmee shall take all necessary steps, using                the                Assignment Procedure, to have Farmee made a party to the Existing                JOA for                a 40% participating interest in respect of the earned Farmout                Lands. |
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**NORTHERN      AS CONTRACT OPERATOR**

| **8.1** | Until                such time as Farmee either selects another operator to conduct operations                on Farmee’s behalf under this Agreement or assumes such activities itself,                Farmee and Northern agree that Northern shall conduct such operations                on                Farmee’s behalf as an independent contract operator. Northern shall be                entitled to be reimbursed for all costs and expenses incurred by                it in                connection with acting as contractor operator, but otherwise, shall                not be                entitled to be paid a fee for that service). Northern represents                and                warrants to Farmee that Northern holds all necessary permits and                other                authorizations required by Northern to hold well licenses in its                name and                conduct such operations on the Farmout Lands (including, without                limitation, those authorizations required from the Alberta Energy                and                Utilities Board). |
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| **8.2** | At                such time as Farmee elects to replace Northern or use another contract                operator, Northern shall transfer the well licenses in its name to                the                successor designated by Farmee |
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**ARTICLE      9**

**AREA      OF MUTUAL INTEREST**

| **9.1** | Article                8.00 of the Farmout & Royalty Procedure will be in effect from                Effective date of this agreement until the end of the Earning Period.                Subject to that Article, the Parties will have the right to participate                in                an acquisition of Mutual Interest Lands in the following                percentages: Farmor                  - 50%Farmee                  - 50%. |
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| **9.2** | Without                limiting the generality of Section 9.1, this Article 9 shall apply                in                respect of any interest acquired by Northern or any of its Affiliates                pursuant to the Non-Disclosure/Area of Exclusion Letter Agreement                dated                April 27, 2004 between Northern and Pan Orient Energy Ltd. (formerly                Maxen                Petroleum Inc. by name change). Northern shall promptly advise Farmee                of                any opportunities available to Northern under that agreement and                Northern                shall, if directed by Farmee, exercise its right to acquire the available                interest(s) (on the basis specified in Section 9.1                above). |
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| **9.3** | Notwithstanding                Sections 9.1 and 9.2, and for greater certainty, Article 8.00 of                the                Farmout & Royalty Procedure shall not apply to the acquisition by the                Farmor of the lands comprising the 6.5 Section Block. Upon the Farmor                acquiring legal or beneficial title to the 6.5 Section Block, such                lands                such constitute “Farmout Lands” for the purposes of this                Agreement. |
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**ARTICLE      10**

**RECONVEYANCE      OF FARMOUT LANDS**

| **10.1** | Promptly                following the end of the Earning Period, Farmee shall convey to Deep                Well                or Northern, as directed by Deep Well, a 40% beneficial interest                in those                Farmout Lands (if any) in which Farmee has not earned an interest                by the                end of the Earning Period. In the event Farmee has not earned a majority                interest in any of the lands included within a single Title Document,                then                Farmee shall also transfer to Deep Well or Northern in accordance                with                their interest as originally held, Farmee’s legal title to a 40% undivided                interest in such Title Document. However, if Farmee has earned a                majority                interest in the lands within a Title Document, Farmee shall be entitled                to                remain as a registered lessee for that Title Document (as to a 40%                undivided interest) but shall hold in trust for Farmor a 40% beneficial                interest in any Farmout Lands in that Title Document not earned by                Farmee                under this Agreement. |
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| **10.2** | The                40% interests conveyed by Farmee to Farmor pursuant to this Article                shall                be free and clear of any and all royalties, burdens, claims, encumbrances                and other adverse interests created by, through or under Farmee including,                without limitation, any encumbrances registered by Farmee’s lender. Farmee                shall cause any such lender to provide no interest letters or, if                possible, partial discharges and releases, as necessary in respect                of any                such 40% interests reconveyed by Farmee to                Farmor. |
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**ARTICLE      11**

**ACQUISITION      OF SEISMIC DATA**

| **11.1** | Upon                completion of Farmee’s earning obligations under Article 3 (following the                drilling of the Test Well), or at any time thereafter, and if both                Parties                reasonably agree that further seismic data is required prior to the                drilling of any one or more of the Option Wells, then Farmor shall                participate with Farmee, each as to an undivided 50% interest (or                40%                interest if each of the other Joint-Operators participate), in the                shooting of additional seismic data on some or all of the Farmout                Lands. |
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**ARTICLE      12**

**DEEP      WELL - AGENT FOR THE FARMORS**

| **12.1** | Deep                Well is the agent for the Farmor for all purposes under this Agreement.                Farmee shall deal solely with Deep Well in respect of all matters                relating                to the Farmor or either of them. Farmee shall be entitled to rely                solely                on all communications from Deep Well as having been made by and on                behalf                of Deep Well and Northern. Northern shall be bound by all decisions,                elections and other determinations and communications made or issued                by                Deep Well under this Agreement and Northern shall not communicate                with                Farmee under any circumstances whatsoever (and Farmee shall be entitled                to                disregard any such Northern                communications). |
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| **12.2** | Deep                Well and Northern are jointly and severally liable for the performance                of                all obligations and liabilities of Farmor under this Agreement regardless                of whether any particular obligation or liability pertains to either                or                both of the 32 Section Block or the 31 Section                Block. |
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**ARTICLE      13**

**PROSPECT      FEE**

| **13.1** | In                recognition of the potential play developed by Farmor in respect                of the                Farmout Lands, Farmee shall pay to Farmor, at the following times                and                subject to the following legal obligations imposed on Farmee (if                any), the                aggregate amount of $2,000,000 USD (reduced by the deductions specified                herein) as a prospect fee, payable as 90% to Northern and 10% to                Deep                Well. |
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|   | (a) | $1,000,000                USD payable 7 business days following the execution and delivery                of this                Agreement by the Parties such amount to be reduced by the aggregate                of the                following amounts: |
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|   | (i) | $50,000                USD reflecting Farmor’s agreement to pay 50% of the commissions associated                with the payment of the first tranche of the Gemini Investment Strategies                LLC financing (“**Gemini                Financing**”); |
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|   | (ii) | 50%                of all legal fees, disbursements and associated taxes incurred (to                the                date of this Agreement) by Farmee and Surge Global Energy, Inc.                (“**SRGG**”)                in connection with this Agreement and the Gemini Financing (being                the                legal costs of Farmee’s Calgary counsel and SRGG’s corporate, commercial                and securities counsel in Denver and the legal fees of Gemini Investment                Strategies LLC); and |
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|   | (b) | $1,000,000                USD payable upon the completion or abandonment of the first Option                Well                drilled by Farmee under this Agreement, such amount to be reduced                by the                following amount, $50,000 USD reflecting Farmor’s agreement to pay 50% of                the commissions associated with the payment of the second tranche                of the                Gemini Financing |
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*Income      Tax Act*
*Income      Tax Act*
*Income      Tax Act*

**ARTICLE      14**

**SURGE      SHARES**

| **14.1** | Pursuant                to the Escrow Agreement to be completed by March 31st,                2005 among Farmor, Farmee, and an escrow agent, to be retained by                Surge.                The appointed escrow agent will hold one or more certificates representing                33 1/3 % of the fully diluted common shares of Surge Global Energy,                Inc.                (“**Shares**”)                outstanding as of February 17th                2005 (approximately 11.6 Million Surge Shares to be issued to Farmor),.                The nature of the shares, the conversion mechanism to earn or transfer                of                these shares, the anti-dilutive provisions, the representations and                warranties of the parties regarding these shares, the registration                rights                and obligations of the parties pertaining to these shares shall all                be                mutually agreed upon as part of the Escrow Agreement. The Shares                are to be                held by the escrow agent thereunder for delivery to Farmor when Farmor                delivers to Farmee a reserves report (“**Report**”)                for the Properties which is in form and substance satisfactory to                Deep                Well and Farmee, acting reasonably, from a mutually acceptable reservoir                engineering firm and which confirms that the Proved Reserves for                the                Properties exceed $80,000,000 USD. The Report                shall: |
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|   | (a) | use                the forward curve price forecast that is being used by that engineering                firm for the majority of the reserves studies that it is completing                at the                time the Report is prepared; |
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|   | (b) | use                a 12.5% discount rate; and |
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|   | (c) | attribute                a value of 100% to the Proved Reserves and no value to probable reserves                or undeveloped lands. |
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**ARTICLE      15**

**REPRESENTATIONS      AND WARRANTIES**

| **15.1** | Farmor                hereby represents and warrants to Farmee (and acknowledges that Farmee                is                relying on such representations and warranties)                that: |
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|   | (a) | Deep                Well is a body corporate duly incorporated and validly existing under                the                laws of Nevada and is extra-provincially registered in Alberta, and                Northern is a body corporate incorporated and validly existing under                the                laws of Alberta; |
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|   | (b) | Farmor                has taken all necessary actions and has all requisite power and authority                to enter into this Agreement and to perform its obligations under                this                Agreement and any other agreements to be delivered hereunder and                this                Agreement constitutes and such other agreements will constitute legal,                valid and binding obligations of Farmor, enforceable against Farmor                in                accordance with and subject to the terms set forth herein and                therein; |
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|   | (c) | The                consummation by Farmor of the transactions contemplated herein will                not                violate or conflict with any of the constating documents, by-laws                or                governing documents of Farmor, any judgment, decree, order, statute,                rule                or Regulation applicable to Farmor or any material agreement or instrument                to which it is a party or by which it is                bound; |
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|   | (d) | Deep                Well is a non-resident of Canada and Northern is not a non-resident                of                Canada, in each case within the meaning of the *Income                Tax Act*                (Canada); |
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|   | (e) | There                are no claims, proceedings, actions, lawsuits, administrative proceedings                or governmental investigations in existence, or so far as Farmor                is aware,                contemplated or threatened against or with respect to the Farmor                (or                either of them) or any of the Farmout Lands or Title Documents and                there                is no particular circumstance, matter or thing known to Farmor which                could                reasonably be anticipated to give rise to any such claim, proceeding,                action, lawsuit, proceeding or                investigation; |
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|   | (f) | There                are no outstanding authorizations for expenditures, mail ballots,                cash                calls or other financial commitments with respect to any of the Farmout                Lands other than those as itemized on schedule                15.1(f); |
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|   | (g) | There                are no agreements for the purchase or sale of petroleum substances                that                may be deliverable from any of the Farmout                Lands; |
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|   | (h) | No                exploration, development or other material activities of any kind                have                occurred on any of the Farmout Lands and, as a result, there are                no wells,                well sites or tangibles located on the surface of or within any of                such                lands; excepting the 6.5 Section Block referred to in                1.1(a) |
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|   | (i) | There                are no rights of first refusal or other similar rights applicable                to any                of the Farmout Lands; |
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|   | (j) | Farmor                shall not and has not knowingly withheld any records, files or other                documents in its possession relating to the Farmout Lands or Title                Documents and which Farmee has requested from Farmor;                and |
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|   | (k) | There                are no areas of mutual interest or similar rights pertaining to any                of the                Farmout Lands that remain in effect as of the Effective Date, excepting                those listed on schedule 15.1(k). |
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| **15.2** | Farmee                hereby represents and warrants to Farmor                that: |
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|   | (a) | Farmee                is a corporation duly incorporated and validly existing under the                laws of                Alberta; |
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|   | (b) | Farmee                has taken all necessary actions and has all requisite power and authority                to enter into this Agreement and to perform its obligations under                this                Agreement and any other agreements to be delivered hereunder and                this                Agreement constitutes and such other agreements will constitute legal,                valid and binding and obligations of Farmee, enforceable against                Farmee in                accordance with and subject to the terms set forth herein and                therein; |
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|   | (c) | The                consummation by Farmee of the share transactions contemplated by                this                Agreement will not violate or conflict with any of the constating                documents, by-laws or governing documents of Farmee or any provision                of                any material agreement or instrument to which Farmee is a party or                is                bound, or any judgment, decree, order, statute, rule or regulation                applicable to Farmee; |
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**ARTICLE      16**

**ADDRESS      FOR SERVICE**

| **16.1** | The                address for service of notice hereunder for each of Farmor and Farmee                shall be as follows: |
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|   | Farmor: | c/o                Deep Well Oil & Gas, Inc               |   | Farmee: | Surge                Global Energy (Canada), Ltd.                              |
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|   |    | Suite                2600, 144 - 4th                Avenue SW |   |    | Suite                2600, 144 - 4th                Avenue SW                  |
|   |    | Calgary,                AB T2P 3N4                            |   |    | Calgary,                AB T2P 3N4                                             |
|   |    | Attention:                Steven Gawne, President             |   |    | Attention:                Fred Kelly, President and CEO                        |
|   |    | Facsimile:                No. (403) 232-1464                  |   |    | Facsimile                No.: (858) 704-5011 and                (403) 355-3371 |

**ARTICLE      17**

***LIMITATIONS      ACT***

| **17.1** | The                2-year period for seeking a remedial order under Section 3 of the                *Limitations                Act*                (Alberta), as amended, for any claim (as defined in that legislation)                arising in connection with this Agreement is extended                to: |
|----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | for                claims disclosed by an audit, 2 years after the time this Agreement                permitted that audit to be performed;                or |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | for                all other claims, 4 years. |
|--------|-----|-----------------------------------------------|

**ARTICLE      18**

**EARNED      INTEREST**

| **18.1** | It                is the intentions of the Parties that Farmee is incurring significant                expenditures to earn a 40% undivided interest in the Farmout Lands                (to the                extent of Farmee’s drilling operations hereunder).  If, immediately                prior to the time Farmor conveyed a 40% undivided interest in the                Farmout                Lands and Title Documents to Farmee, the Farmor had less than a 80%                beneficial interest in any of the Farmout Lands or the Title Documents,                the Farmee shall nevertheless earn a 40% undivided beneficial interest                in                and to the Farmout Lands earned hereunder even if the effect is that                the                Farmor’s residual beneficial interest (after earning by Farmee) is less                than a 40% undivided interest in those Farmout                Lands. |
|----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**ARTICLE      19**

**RIGHT      OF FIRST REFUSAL**

| **19.1** | Notwithstanding                that: |
|----------|--------------------------------------|

|   | (a) | the                Existing JOAs do not provide for a right of first refusal in the                event a                party wishes to dispose of an interest in any of the lands governed                by                such agreements; and |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Farmee                will made a party to the Existing JOAs (as provided for in Article                7                hereof), |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------|

*mutatis      mutandis*

**ARTICLE      20**

**GENERAL**

| **20.1** | This                Agreement contains the final and entire agreement of the Parties                respecting earning by Farmee of interests in the Farmout Lands from                Farmor                and, as such and in respect of that subject matter, supercedes all                prior                agreements, memorandums of understanding, letters of intent, verbal                understandings and discussions to the extent specifically relating                to such                subject matter. |
|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **20.2** | In                the event of any inconsistency or conflict between the provisions                of this                Head Agreement and those of any Schedule attached hereto, the provisions                of this Head Agreement shall                prevail. |
|----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **20.3** | The                terms, covenants and conditions in this Agreement shall run with,                attach                to, be binding upon, and form part of the Farmout Lands and the Title                Documents, and the estates affected thereby for the duration of this                Agreement. |
|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **20.4** | If                any term of this Agreement is or becomes invalid, illegal or unenforceable                in any jurisdiction, such invalidity, illegality or unenforceability                shall                not affect the validity, legality or enforceability of any other                term of                this Agreement and such invalid, illegal or unenforceable term shall                be,                as to such jurisdiction, severable from this                Agreement. |
|----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **20.5** | This                Agreement shall be conclusively deemed for all purposes to be made                under,                and for all purposes to be governed by and construed in accordance                with                the laws of the Province of Alberta and of Canada applicable therein                and                shall be treated in all respects as an Alberta contract.  Each of the                Parties hereby attorns to the Courts of Alberta at Calgary in respect                of                any suit, action or proceeding connected with this                Agreement. |
|----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **20.6** | Each                Party shall from time to time and at all times do all such further                acts                and execute and deliver all such further documents as may be reasonably                required in order to perform and carry out the terms and the intent                of                this Agreement. |
|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **20.7** | This                Agreement may be executed in any number of separate counterparts                with the                same effect as if all Parties had signed the same copy of this                Agreement.  All counterparts shall be construed together and                constitute one agreement.  Each Party shall be entitled to rely on                the delivery of executed facsimile copies of counterpart execution                pages                of this Agreement and such facsimile copies shall be legally effective                to                create a valid and binding agreement between the                Parties. |
|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| **20.8** | This                Agreement shall inure to the benefit of and be binding upon the Parties                and their respective successors and permitted                assigns. |
|----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **NORTHERN                ALBERTA OIL LTD.** |                                          | **DEEP                WELL OIL & GAS, INC.**      |   |
|----------------------------------------------|-----------------------------------------------|-------------------------------------------------------|--------|
|                                         |                                          |                                                  |   |
| Per:                                         |                  /s/ Curtis J. Sparrow   |                                                  | Per:   |                  /s/ Steven Gawne |   |
|                                         |                                          |                                                  |   |
| Per:                                         |                  President               |                                                  | Per:   |                  President and Chief Executive Officer |   |
|                                         |                                          |                                                  |   |
| **SURGE                GLOBAL ENERGY Inc..** |                                          | **SURGE                GLOBAL ENERGY (CANADA), LTD.** |   |
|                                         |                                          |                                                  |   |
| Per:                                         |                  /s/ Fred W. Kelly       |                                                  | Per:   |                  /s/ Fred W. Kelly |   |
|                                         |                                          |                                                  |   |
| Per:                                         |                  Chief Executive Officer |                                                  | Per:   |                  Chief Executive Officer |   |

----

**SCHEDULE      “A” **

| **FARMOUT                LANDS**                                                                                                                                                                                                                                               |   | **TITLE                DOCUMENTS**                                                                                                                                                                                                                                                    |   | **FARMOR’S****PRE-****FARMOUT****WORKING****INTERESTS** |   | **ENCUMBRANCES**                                            |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------|--------|-------------------------------------------------------------|
| ***32                Section Block ****                                                                                                                                                                                                                                        |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
|                                                                                                                                                                                                                                                                           |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
| Township                91, Range 12:Sections                27, 28, 29, 30, 31,32;Township                91, Range 13: Sections 25, 26, 27, 35, 36Oil                Sands (Top of the PeaceRiver                to Base of thePekisko)Covering                2816 hectares |   | Alberta                Crown Oil Sands Development Lease 7403070365 dated July 10th                2003 and currently standing in the name of Northern Alberta Oil,                Ltd. -                80%, Pan Orient Energy Ltd. - 10%, 1132559 Alberta Ltd.                10%   |   | 80%                                                           |   | Crown                RoyaltyNearshore                ORR ** |
|                                                                                                                                                                                                                                                                           |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
| Township                92, Range 13:Sections                1, 2, 10, 11, 12, 13,14,                15, 22, 23, 24Oil                Sands (Top of the PeaceRiver                to Base of thePekisko)Covering                2816 hectares                                  |   | Alberta                Crown Oil Sands Development Lease 7403070367 dated July 10th                2003 and currently standing in the name of Northern Alberta Oil,                Ltd. -                80%, Pan Orient Energy Ltd. - 10%, 1132559 Alberta Ltd. -                10% |   | 80%                                                           |   | Crown                RoyaltyNearshore                ORR ** |
|                                                                                                                                                                                                                                                                           |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
| Township                92, Range 13:Sections                6, 7, 8, 9, 16, 17,18,                19, 20, 21Oil                Sands (Top of the PeaceRiver                to Base of thePekisko)Covering                2560 hectares                                        |   | Alberta                Crown Oil Sands Development Lease 7403070368 dated July10th 2003                and                currently standing in the name of Northern Alberta Oil, Ltd. - 80%,                Pan                Orient Energy Ltd. - 10%, 1132559 Alberta Ltd. - 10%  |   | 80%                                                           |   | Crown                RoyaltyNearshore                ORR ** |
|                                                                                                                                                                                                                                                                           |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
| ***31                Section Block ****                                                                                                                                                                                                                                        |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
|                                                                                                                                                                                                                                                                           |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
| Township                92, Range 12:Sections                15, 16, 17, 18, 19,20,                21, 28, 29, 30, 31, 32, 33Oil                Sands (Top of the PeaceRiver                to Base of thePekisko)Covering                3328 hectares                        |   | Alberta                Crown Oil Sands Development Lease 7404080870 dated August 19th                2004 and currently standing in the name of Deep Well Oil & Gas, Inc. -                80%, Pan Orient Energy Ltd. - 10%, 1132559 Alberta Ltd. -                10%           |   | 80%                                                           |   | Crown                RoyaltyNearshore                ORR ** |
|                                                                                                                                                                                                                                                                           |   |                                                                                                                                                                                                                                                                                  |   |                                                          |   |                                                        |
| Township                92, Range 12:Sections                22, 26, 27, 34, 35,36                                                                                                                                                                                             |   | Alberta                Crown Oil Sands Development Lease 7404080871 dated August 19th                2004 and currently standing in the                                                                                                                                               |   | 80%                                                           |   | Crown                RoyaltyNearshore                ORR ** |

----

| **FARMOUT                LANDS**                                                                                                                                                                                                                                                         |   | **TITLE                DOCUMENTS**                                                                                                                                                                                                                                          |   | **FARMOR’S****PRE-****FARMOUT****WORKING****INTERESTS** |   | **ENCUMBRANCES**                                            |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------|--------|-------------------------------------------------------------|
| Oil                Sands (Top of the Peace River to Base of the Pekisko)Covering                1536 hectares                                                                                                                                                                            |   | name                of Deep Well Oil & Gas, Inc. - 80%, Pan Orient Energy Ltd. - 10%,                1132559 Alberta Ltd. - 10%                                                                                                                                         |   |                                                          |   |                                                        |
|                                                                                                                                                                                                                                                                                     |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
| Township                92, Range 13:Sections                25, 26, 27, 28, 29,30,                31, 32, 33, 34, 35, 36Oil                Sands (Top of the PeaceRiver                to Base of thePekisko)Covering                3072 hectares                                      |   | Alberta                Crown Oil Sands Development Lease 7404080872 dated August 19th                2004 and currently standing in the name of Deep Well Oil & Gas, Inc. -                80%, Pan Orient Energy Ltd. - 10%, 1132559 Alberta Ltd. -                10% |   | 80%                                                           |   | Crown                RoyaltyNearshore                ORR ** |
|                                                                                                                                                                                                                                                                                     |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
| ***6.5                Section Block***                                                                                                                                                                                                                                                   |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
|                                                                                                                                                                                                                                                                                     |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
| Township                91, Range 13: N1⁄2                Section 28, Sections 32,33,                34; Township 92, Range13:                Sections 3, 4, 5                                                                                                                        |   | Alberta                Crown Oil Sands Permit 7003040812 dated ·.                                                                                                                                                                                                      |   | TBD                                                           |   | TBD                                                         |
|                                                                                                                                                                                                                                                                                     |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
| Oil                Sands (Top of the Peace River to Base of the Pekisko)                                                                                                                                                                                                                 |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
|                                                                                                                                                                                                                                                                                     |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
| Covering                1664 hectares                                                                                                                                                                                                                                                    |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
|                                                                                                                                                                                                                                                                                     |   |                                                                                                                                                                                                                                                                        |   |                                                          |   |                                                        |
| Township                91, Range 13: N1⁄2                Section 28, Sections 32,33,                34; Township 92, Range13:                Sections 3, 4,5Petroleum                & Natural Gas(from                Surface to Basement)Covering                1664 hectares |   | Alberta                Crown Petroleum and Natural Gas Lease 5495030101 dated ·.                                                                                                                                                                                       |   | TBD                                                           |   | TBD                                                         |

----

| *** | The                use of the headings “*32                Section Block” and “31 Section Block”*                are intended for convenience of reference only and are not, under                any                circumstances whatsoever, to be taken into consideration when interpreting                this Agreement or when determining a Party’s rights or obligations under                this Agreement. Without limiting the generality of the foregoing,                Farmee                may (but is not required), when selecting any 6 section block of                lands in                which Farmee earns a 40% undivided interest by the drilling of the                Test                Well or any Option Well, include lands from each of the 38.5                Section Block and the 31 Section Block in any such 6 section                block. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ** | Pursuant                to the Assumption of Liabilities and Indemnity Agreement, Farmor                shall be                solely responsible for the payment of the Nearshore ORR as it would                otherwise pertain to the interests earned by Farmee in the Farmout                Lands. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| *** | The                6.5 Section Block shall not constitute “Farmout Lands” for the purposes                hereof unless or until the Farmor acquires a legal or beneficial                interest                in the Title Documents that comprise the 6.5 Section                Block. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**FEBRUARY      24, 2005**

**SCHEDULE      “B” attached to and forming part of a Farmout Agreement dated as of the 25th day      of February 2005 between Deep Well Oil & Gas, Inc. and Northern Alberta Oil      Ltd., as Farmor and Surge Global Energy (Canada), Ltd., as      Farmee**

**Farmout      & Royalty Procedure Elections and Amendments**

| 1. | Effective Date (Subclause 1.01(f) - February 17,              2005) |
|----|---------------------------------------------------------------------|
|   |   |
|--------|--------|
| 2. | Payout              (Subclause 1.01(t), if Article 6.00 applies) - Alternate ______ -              N/A |
|----|--------------------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 3. | Incorporation              of Clauses from 1990 CAPL Operating Procedure (Clause              1.02) |
|----|-----------------------------------------------------------------------------------------------------|
|   | (l) Insurance (311) Alternate              A - o Alternate              B - x |
|--------|----------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 4. | Article 4.00 (Option Wells) will x/will              not o              apply. |
|----|-------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 5. | Article 5.00 (Overriding Royalty) will o/will              not x              apply. |
|----|-------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 6. | Quantification of Overriding Royalty (Subclause                5.01A,                if applicable) |
|----|-----------------------------------------------------------------------------------------------------|

|        | (i)    |   | Crude                Oil (a) | -      | Alternate                             | -      | N/A    |   |   |   |   |   |   |
|--------|--------|--------|------------------------------|--------|---------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|
|   |   |   |                         | -      | If                Alternate 1 applies |   | %      |   |   |   |   |   |   |
|   |   |   |                         | -      | If                Alternate 2 applies |   | min    |   | %      | max    |   | %      |   |
|   |   |   |                         |   |                                  |   |   |   |   |   |   |   |   |
|   |   |   | Other                (b)     | -      | Alternate                             | -      | N/A    |   |   |   |   |   |   |
|   |   |   |                         | -      | If                Alternate 1 applies |   | %      |   |   |   |   |   |   |
|   |   |   |                         | -      | If                Alternate 2 applies |   | min    |   | %      | max    |   | %      |   |

| 7. | Permitted Deductions (Subclause 5.04B, if applicable)              -              Alternate - N/A |
|----|---------------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 8. | Article 6.00 (Conversion of Overriding              Royalty)  will o/will              not x              apply. |
|----|---------------------------------------------------------------------------------------------------------------------------------|
|   | •                If              Article 6.00 applies, conversion to N/A              OF              Working interest in Subclause 6.04 A. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 9. | Article 8.00 (area of Mutual Interest) will x/will              not o              apply. |
|----|-----------------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 10. | Reimbursement                of Land Maintenance Costs (Clause 11.02) will o/will                not ý apply.                 If applies, reimbursement of                $________. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**FEBRUARY      24, 2005**

**SCHEDULE “C”      attached to and forming part of a Farmout Agreement dated as of the 25th day      of      February 2005 between Deep Well Oil & Gas, Inc. and Northern      Alberta Oil Ltd., as Farmor and Surge Global Energy (Canada), Ltd., as      Farmee**

**1990      CAPL OPERATING PROCEDURE**

| I.     |   | Clause                311 |   | Insurance                Election:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | A.     |   |   |   | B.     |   | X      |
|--------|--------|---------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|
|   |   |                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| II.    |   | Clause                604 |   | Marketing                Fee:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | A.     |   | X      |   | B.     |   |   |
|   |   |                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| III.   |   | Clause                903 |   | Casing                Point Election:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | A.     |   | X      |   | B.     |   |   |
|   |   |                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| IV.    |   | Clause 1004          |   | Replace              with the following:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |
|   |   |                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |   |                      |   | “Notwithstanding              anything to the contrary contained in this              Operating Procedure, if the Operator is a participating party, it shall              carry out the operation for the account of the participating parties;              provided that, if the Operator is not a participating party, the              participating parties shall, as and among themselves and in accordance              with the provisions of Clause 206, *mutatis              mutandis*,              appoint an Operator for the operation.  If the operation is commenced              prior to the time the Operator becomes a participating party, it is              specifically understood that nothing in this Clause shall restrict              or              prohibit the proposing party from actually commencing operations as              provided in Clause 1003.  The Operator, upon becoming a participating              party, shall have the right to take over and carry out the operation              for              the participating parties.” |

| V. |   | Clause 1007 |   |  Penalty              for Independent              Operations: |
|----|--------|-------------|--------|---------------------------------------------------------------------|

|   | 1.     | Development Wells: | 400%   |
|--------|--------|--------------------|--------|
|   |   |               |   |
|   | 2.     | Exploratory Wells: | 500%   |
|   |   |               |   |

| VI. |  | Clause 2202 |  | Title                Preserving Well: | 180              days |
|-----|--|-------------|--|---------------------------------------|-----------------------|

| VII. |   | Clause 2202  |   |  Address              for Notices: |
|------|--------|-------------------|--------|-----------------------------------------|

|   | Farmor: | c/o                Deep Well Oil & Gas, Inc                    |   | Farmee: | Surge                Global Energy (Canada), Ltd.                  |
|--------|---------|-------------------------------------------------------------------------|--------|---------|--------------------------------------------------------------------|
|   |    | •Suite 2600,                144-4th                Avenue SW |   |    | Suite 2600,                144 - 4th                Avenue SW |
|   |    | •Calgary,                AB T2p 3N4                               |   |    | Calgary,                AB T2P 3N4                                 |
|   |    | •Attention                Steve Gawne, CEO                        |   |    | Attention:                Fred Kelly, CEO                          |

| VIII. |   | Clause                2401 |   | Disposition                of Interests: |   | A. |   |   |   | B. |   | X |
|-------|--------|----------------------------|--------|------------------------------------------|--------|----|--------|--------|--------|----|--------|---|

| IX. |   | Clause                2404 |   | Deleted              and              replaced with the Assignment Procedure |
|-----|--------|----------------------------|--------|------------------------------------------------------------------------------|

----

**1996      PASC ACCOUNTING PROCEDURE**

|  I. | Clause 105 Operating              Fund: 10% Clause                110 Approvals:                 2 or more Owners totaling 65% Clause                112 Expenditure                Limitations: |
|----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a)       | excess of       | $  25,000.00 |
|--------|-----------|-----------------|------------------------|
|   |      |            |                   |
|   | (c)  | excess of  | $  25,000.00 |

| II. | Clause                201(a) 6 Labour:                 Delete and replace as follows: “Salaries                and wages of the Operator’s employees                engaged in production Engineering who are either temporarily or                permanently assigned to and directly employed off-site in direct                support                of Joint Operations.” |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| II.    | Clause                202(b) | Employee Benefits - not to exceed:               25%                                                 |
|--------|------------------------------|-----------------------------------------------------------------------------------------------------------|
|   |                         |                                                                                                      |
|   | Clause 207                   | Services:               replace “warehouse” with “Warehouse” throughout      |
|   |                         |                                                                                                      |
|   | Clause 213(b)                | Camp and Housing:               shall o/shall              not  x              apply. |
|   |                         |                                                                                                      |
|   | Clause 216                   | Warehouse handling: 5%                                                                               |
|   |                         |                                                                                                      |
|   | Clause 221              | Allocation Options: n/a                                                                              |

| III. | Clause                301(a) Cost: Delete                and replace as follows: “Cost”                  means total expenditures described in Article II, excluding those                  expenditures pursuant to Subclause 209(b) and Clause 218 of this                  Accounting Procedure, and salvage credits for Material retired,                  the value                  of injected substances purchased for enhanced recovery and any                  additional                  exclusions as approved by the                  Owners. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| IV. | Clause                302 | Overhead              Rates: |
|-----|---------------------------|------------------------------|

|   | (a)    | For                each Exploration Project: |
|--------|--------|----------------------------------------------|
|   |   |                                         |   |
|   |   | (i)                                          | 5%                of first | $   50,000 |
|   |   | (ii)                                         | 3%                of first  | $  100,000 |
|   |   | (iii)                                        | 1%                of costs in excess of sum of (i) and              (ii) |

|   | (b)    | For                  each Drilling Well: |
|--------|--------|------------------------------------------|
|   |   |                                     |   |
|   |   | (i)                                      | 5%                of first | $   50,000 |
|   |   | (ii)                                     | 3%                of first  | $  100,000 |
|   |   | (iii)                                    | 1%                of costs in excess of sum of (i) and              (ii) |

----

|   | (c)    | For                    each Initial Construction Project: |
|--------|--------|-----------------------------------------------------------|
|   |   |                                                      |   |
|   |   | (i)                                                       | 5%                of first | $   50,000 |
|   |   | (ii)                                                      | 3%                of first  | $  100,000 |
|   |   | (iii)                                                     | 1%                of costs in excess of sum of (i) and              (ii) |

|   | (d)    | For                    each Subsequent Construction Project: |
|--------|--------|--------------------------------------------------------------|
|   |   |                                                         |   |
|   |   | (i)                                                          | 5%                of first | $   50,000 |
|   |   | (ii)                                                         | 3%                of first  | $  100,000 |
|   |   | (iii)                                                        | 1%                of costs in excess of sum of (i) and              (ii) |

|   | (e)    | For                      Operation and Maintenance:                                                      |
|--------|--------|----------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                     |   |
|   |   | (i)                                                                                                      | 10%                   of the cost of the Joint Property; and |
|   |   | (ii)                                                                                                     | $350                   per Producing Well per month; or |
|   |   | (iii)                                                                                                    | ____ Flat              rate per month |
|   |   |                                                                                                     |   |
|   |   | Subclause 302(3)(ii) and 302              (e)(iii) shall o/shall              not xapply. |

| V.     | Clause                406 | Dispositions:               $25,000                                                              |
|--------|---------------------------|-------------------------------------------------------------------------------------------------------|
|   |                      |                                                                                                  |
|   | Clause 406                | Dispositions:               replace “affiliates” with “Affiliates”       |
|   |                      |                                                                                                  |
| VI.    | Clause 501                | (b) Dispositions:               replace “warehouse” with“Warehouse” |

----

**SCHEDULE 15.1(f) attached      to and forming part of a Farmout Agreement dated as of the 25th day of      February 2005 between Deep Well Oil & Gas, Inc. and Northern      Alberta Oil Ltd., as Farmor and Surge Global Energy (Canada), Ltd., as      Farmee**

**Outstanding      Authorizations for Expenditures, Etc.**

----

**SCHEDULE 15.1(k)      attached to and forming part of a Farmout Agreement dated as of the 25th day      of      February 2005 between Deep Well Oil & Gas, Inc. and Northern      Alberta Oil Ltd., as Farmor and Surge Global Energy (Canada), Ltd., as      Farmee**

**Areas      of Mutual Interest**

----