MEMORANDUM


                 PETROLEUM EXPLORATION LICENCE NO 61



1    This  Licence granted on 23 May, 1996 is hereby entered  on  the
Petroleum Register.

2.  A security in the sum of $15,000 has been lodged with respect to
this licence.

3.  Interests in the licence are:-

                   Hemley Exploration Pty Ltd 100%


A.J.Andrewjewskis
Chief Executive Officer
DEPARTMENT OF MINES AND ENERGY
Delegate of the Minister for Mines and Energy
                         PETROLEUM ACT 1940

PETROLEUM EXPLORATION LICENCE NO 61

I, ANDREW JOSEPH ANDREJEWSKIS, Chief Executive Officer, Department of
Mines  and  Energy (CEO) in the State of South Australia pursuant  to
the  provisions  of  the Petroleum Act, 1940 and all  other  enabling
powers, for and on behalf of, Stephen John Baker, Minister for  Mines
and  Energy  (Minister), pursuant to delegation dated 14  June  1995,
(refer Government Gazette dated 15 June 1995 page 2845), HEREBY GRANT
to  HEMLEY EXPLORATION PTY LTD (ACN 073 039 059) of C/- Pannell  Kerr
Forster,  191 Flinders Street, Adelaide SA 5000 (hereinafter referred
to as the Licensee) a Petroleum Exploration Licence in respect of the
area set out below, to have effect for a period of five years and  to
expire on May 2001

                         DESCRIPTION OF AREA

The land comprised in this licence is that part of the State of South
Australia described in the Schedule hereto.

                             CONDITIONS
                                  
1.   The Licensee shall at all times comply with:-

     a)   the provisions of the Petroleum Act, 1940 and of any regulations
       for the time being and from time to time in force under the Act,

     b)   all directions given to it under the Act or the regulations for
       the time being and from time to time in force under that Act; and

     c)   the terms and conditions of an Access Agreement dated 5 March
       1996 between Anangu Pitjantjatjara and John Leonard Naylor and Paul
       Bryan Ingram.

2.    During the term of the licence, the Licensee shall carry out or
  cause to be carried out exploratory operations on the area comprised
  in  the  licence  in  accordance with such work programmes  as  are
  approved  by  the  Minister from time to time.   These  exploratory
  operations shall include but not necessary be limited to:-

a)    In  the first year of the term of the licence, the drilling  of
  one stratigraphic well, technical evaluation and review of available
  data and program management at a total estimated cost of $1,250,000
  (one million, two hundred and fifty thousand dollars).

b)    In the second year of the term of the licence, the drilling  of
  one  stratigraphic well, 250 line kilometers of seismic,  technical
  evaluation and review of available data and program management at a
  total estimated cost of $2,000,000 (two million dollars).
c)    In  the third year of the term of the licence, the drilling  of
one  well,  250 line kilometers of seismic, technical evaluation  and
review  of available data and program management at a total estimated
cost  of  $2,450,000  (two million, four hundred and  fifty  thousand
dollars).

d)    In the fourth year of the term of the licence, the drilling  of
  two  wells, technical evaluation and review of available  data  and
  program  management at a total estimated cost of $3,950,000  (three
  million, nine hundred and fifty thousand dollars).

e)   In the fifth year of the term of the licence, review of data and
  subject to satisfactory results from wells 1-5, the drilling  of  4
  appraisal wells and program management at a total estimated cost of
  $4,975,000  (four million, nine hundred and seventy  five  thousand
  dollars).

3.    Within sixty days after the end of each year (being the  period
  of twelve calendar months ending on the anniversary of the date upon
  which this licence comes into force), the Licensee shall submit  to
  the  Minister a full and complete written statement of  expenditure
  actually made or caused to be made by the Licensee during that year
  upon  approved  exploratory operations.         This  statement  of
  expenditures  shall  be  accompanied by a written  opinion  on  the
  veracity of the statement from an auditor whose qualifications  and
  independence from the Licensee are acceptable to the Minister.

4.    In  the event that the Licensee during any year of the term  of
  this  licence  (a  year being the period of twelve calendar  months
  ending on the anniversary of the date upon which the licence  comes
  into  force)  fails  to  comply  with  the  exploratory  operations
  requirements of this licence, it is an express term of this licence
  that  the  Minister then may at his discretion either  cancel  this
  licence  or authorize such variation to these requirements  as  the
  Minister thinks fit.

5.    An application to drill a well within the area comprised in the
  licence shall include written proposals of the Licensee, in relation
  to  the  bringing  under control of the well,  in  the  event  that
  effective control of the well is lost, and to the clean-up  of  oil
  spills, including financial proposals such as well control insurance,
  public liability insurance or other means to cover the costs involved
  in such operations.

6.    Not  less than thirty days before the commencement of each year
  (being the period of twelve calendar months ending on the anniversary
  of the date upon which this licence comes into force), the Licensees
  must arrange to meet, in person, with the CEO or his representative
  to  review  the  progress of the programme of exploration  for  the
  current licence year, and to present a proposal for the programme of
  exploration for the forthcoming year.

7.    If  at  any time the work being carried out or intended  to  be
  carried out by, or at the cause of, the Licensee is in the opinion of
  the CEO not in accordance with the sound principles and practices of
  petroleum exploration, he may give the Licensee written directions as
  to  the  work  carried out or intended to be carried out,  and  the
  Licensee shall comply with those directions.

8.     In   addition  to  the  reports  specified  in  the  Petroleum
  Regulations, 1989, the Licensee shall promptly prepare and submit to
  the  CEO  in  a  form acceptable to him, detailed  reports  on  all
  exploratory operations done or caused to be done by or on behalf of
  the Licensee within and in relation to the licence area.
Signed by the CFHEF EXECUTIVE OFFICER, DEPARTMENT OF MINES AND ENERGY
at ADELAIDE



this 23 day of May, 1996



CHIEF EXECUTIVE OFFICER
Delegate of the Minister for Mines and Energy


Signed sealed and delivered by the said LICENSEE at Adelaide

this 15th day of May, 1996


The Common Seal of HENLEY EXPLORATION PTY LTD was hereto affixed by




                 PETROLEUM EXPLORATION LICENCE NO 61
                            THE SCHEDULE

                         Description of Area
 All that part of the State of South Australia, bounded as follows:

Commencing at a point being the intersection of latitude 27 00'S  and
longitude  133 00'E,  thence  east to the  eastern  boundary  of  the
Pitjantjatjara  Lands, thence generally southerly and westerly  along
the  boundary of the said Lands to longitude 133'00'E, and  north  to
the  point  of commencement, all the within latitudes and  longitudes
being  geodetic  and  expressed in terms of the  Australian  Geodetic
Datum  as defined on p. 4984 of Commonwealth Gazette number 84  dated
October 6, 1966.


AREA: 6,258 square kilometers approximately.