**ACREAGE
        EARNING AGREEMENT**
  **BETWEEN**
  **TETON
        ENERGY CORPORATION**
  **AND**
  **NOBLE
        ENERGY, INC.**
  **DATED
        EFFECTIVE DECEMBER 31, 2005**
  
   
   **Acreage
        Earning Agreement**
   This
        Acreage Earning Agreement (this “Agreement”), dated effective December 31, 2005
        (the “Effective Time”), is by and between Teton Energy Corporation, 410
        17 th Street,
        Suite 1800, Denver, Colorado 80202 (“Teton”) and Noble Energy, Inc., 1625
        Broadway, Suite 2000, Denver, Colorado, 80202 (“Noble”). Teton and Noble may be
        referred to individually as a “Party” or collectively as the “Parties.” The
        transaction contemplated by this Agreement may be referred to as the
“Transaction.”
   **Recitals**
  A.  Teton
        owns certain interests in oil and gas leases covering acreage located in
        Keith,
        Perkins, Chase and Dundy Counties, Nebraska and Sedgwick County, Colorado,
        all
        as more particularly described in Exhibits A-1 and A-2 below (collectively,
        the
“Leases”).
  B.  Teton
        desires that Noble become a co-owner of an undivided 75% working interest
        (“WI”)
        and 60.75% net revenue interest (“NRI”) in the Leases listed on Exhibit A-1 (the
“81% NRI Leases”) and an undivided 75% WI and the NRI as set forth on Exhibit
        A-2, proportionately reduced to the 75% WI assigned, for the Leases listed
        on
        Exhibit A-2 (with the Leases set forth on Exhibit A-2 being the “Low NRI
        Leases”) and the rights associated therewith (collectively, the “Assets” as
        defined in Section 1.1) by paying the Cash Consideration (as defined in Article
        2) and drilling the “Earning Wells” as that term is defined in Section
        9.1(a).
  C.  Noble
        is
        one of the most active operators in the Niobrara Play in Yuma County, Colorado
        and has drilled and currently operates over 350 oil and gas wells producing
        from
        the Niobrara Formation.
  D.  Noble
        wishes to undertake a similar Niobrara Formation exploration and development
        program on the Leases.
  E.  Noble
        has
        the financial wherewithal, technical expertise and personnel to pursue an
        exploration and development program on the Leases and desires to earn an
        undivided interest in the Leases as set forth herein by drilling the Earning
        Wells, all pursuant to the terms of this Agreement.
  F.  To
        accomplish the foregoing, the Parties wish to enter into this Agreement.
  **Agreement**
  In
        consideration of the mutual promises contained herein, $100 and other good
        and
        valuable consideration, the receipt and sufficiency of which are hereby
        acknowledged, Noble and Teton agree as follows:
  1
  **ARTICLE
        1** **Definition of the Assets**
  1.1  Definition
        of the Assets. The term
“Assets” refers to an undivided 75% WI and 60.75% NRI in the oil and gas Leases
        listed on Exhibit A-1, and an undivided 75% WI and the NRI as set forth on
        Exhibit A-2, proportionately reduced to the 75% WI assigned, for the Leases
        listed on Exhibit A-2, of Teton’s right, title and interest in and to the
        following:
 
 A.  The
        leasehold estates created by the oil and gas leases specifically described
        in
        Exhibits A-1 and A-2 (collectively, the “Leases”), and the oil, gas and all
        other hydrocarbons (“Hydrocarbons”) attributable to the Leases and the lands
        covered thereby (the “Lands”);
  B.  The
        permits, rights-of-way and easements used in connection with the production,
        gathering, treatment, processing, storing, sale or disposal of Hydrocarbons
        or
        water produced from the Leases and Lands described in Subsection 1.1A.;
  C.  Other
        agreements, if any, relating to the properties and interests described in
        Subsections 1.1A and B and to the production of Hydrocarbons, if any,
        attributable to said Leases and Lands;
  D.  All
        existing and effective contracts, agreements and instruments, if any, insofar
        as
        they relate to the Leases and Lands described in Subsections 1.1A through
        C;
  E.  All
        proprietary seismic data and licensed seismic data covering the Leases and
        Land,
        if any, subject to applicable third-party licensing restrictions or other
        restrictions on disclosure or transfer; and
  F.  The
        files, records and geologic data relating to the items described in
        Subsections 1.1A through E maintained by Teton, but only to the extent not
        subject to unaffiliated third party contractual restrictions on disclosure
        or
        transfer (the “Records”).
  The
        term
“Undivided Interest in the Leases” means the interest Teton will assign to Noble
        in the 81% NRI Leases and the Low NRI Leases.
   **ARTICLE
        2** **Cash Consideration**
  2.1  Cash
        Consideration. At Closing, Noble agrees to pay Teton $3,000,000.00 (the
“Cash Consideration”) by wire transfer of immediately available funds, as
        adjusted pursuant to the terms of this Agreement, less the Deposit.
  2.2  The
        Deposit. Contemporaneously with the execution of this Agreement, Noble shall
        pay to Teton, in cash, an amount equal to $300,000.00 (the “Deposit” which
        equals 10% of the “Cash Consideration”) by wire transfer of immediately
        available funds. The Deposit shall be retained by Teton and credited to the
        Cash
        Consideration at Closing or, if this Agreement is terminated on or before
        Closing, shall be distributed or retained pursuant to Article 7.
  2
 **ARTICLE
        3** **Due Diligence**
  3.1  The
        Records. After execution of this Agreement, Teton will make available to
        Noble copies of all Records in the possession of Teton related to the Assets,
        including, without limitation, copies of the
        leases and contracts affecting the Assets. Teton has not
        intentionally withheld from Noble, or intentionally misrepresented, in the
        Records or otherwise, any material information that is necessary or material
        to
        Noble’s evaluation of the Transaction. To the extent that the Records contain
        any interpretations of matters of fact, information, data, printouts,
        extrapolations, projections, documentation, maps, graphs, charts, tables,
        geological data, geophysical data and engineering data, Noble agrees to rely
        on
        such data, information and interpretations at its own risk.
  3.2  Access
        to the Assets. In addition, Teton agrees to grant Noble physical access to
        the Assets to allow Noble to conduct, at Noble’s sole risk and expense, on-site
        inspections and environmental assessments of the Lands comprising the Assets.
        In
        connection with Teton granting such access to Noble,
        Noble represents that it is adequately insured and waives, releases and agrees
        to hold harmless, indemnify and defend Teton, and its respective directors,
        officers, shareholders, employees, agents and representatives, from and against
        all liabilities, obligations, claims and losses, including, without limitation,
        claims for injury to, or death of, persons or for physical damage to property,
        arising directly or indirectly from the access afforded to Noble hereunder
        or
        the physical activities of Noble on the Assets, except for claims or damages
        resulting from the gross negligence or willful misconduct of Teton.
  **ARTICLE
        4** **Representations of Teton**
 
 Teton
        represents to Noble as follows:
  4.1  Existence.
        Teton is a corporation validly existing and in good standing under the laws
        of
        the State of Delaware and is duly qualified to own properties and carry on
        business in the States of Nebraska and Colorado and to hold record title
        to the
        Leases.
  4.2  Due
        Authorization and Execution. This Agreement has been duly authorized,
        executed and delivered on behalf of Teton and all documents and instruments
        required hereunder to be executed and delivered by Teton shall have been
        duly
        authorized, executed and delivered. This Agreement does, and such documents
        and
        instruments will, constitute valid, legal and binding obligations of Teton
        in
        accordance with their terms subject to the effects of bankruptcy, insolvency,
        reorganization, moratorium and similar laws, as well as to principles of
        equity
        (regardless of whether such enforceability is considered in a proceeding
        in
        equity or at law).
  4.3  Power
        and Authority. Teton has all requisite power and authority to carry on its
        business as presently conducted, to enter into this Agreement on the terms
        described in this Agreement and to perform its other obligations under this
        Agreement. The consummation of the Transaction will not violate, nor be in
        conflict with, any provisions of (i) Teton’s governing documents, (ii) any other
        agreement or instrument to which Teton is a party or is bound, or (iii) any
        judgment, decree, order, statute, rule or regulation applicable to Teton.
  3
 4.4  Brokers’
        Fees. Teton has not incurred any liability, contingent or otherwise, for
        brokers’ or finders’ fees relating to this Transaction for which Noble shall
        have any responsibility whatsoever.
  4.5  Litigation.
        There is no action, suit, proceeding, claim or investigation by any person,
        entity, administrative agency or governmental body pending or, to Teton’s
        knowledge, threatened against it before any governmental authority that impedes
        or is likely to impede Teton’s ability to consummate this Transaction.
  4.6  Title
        Matters. Teton
        warrants title to the Leases from and against all persons claiming by, through
        and under Teton, but not otherwise. Teton represents that to the best of
        its
        knowledge, the Leases are valid and in full force and effect. Teton has not
        received a written notice of (a) a material default under the Leases that
        remains uncured, or (b) a material violation of a law, rule or regulation
        applicable to the Leases that remains uncured. To allege a breach of this
        representation, Noble must show that title to 5% of the Leases has actually
        failed based on the opinion of title counsel, and accordingly, that Teton
        does
        not own an interest in that Lease. All Leases shall be valued at $30 per
        net
        mineral acre. The “5% of the Leases” set forth above is a threshold number, and
        not a deductible. Accordingly, 5% of the Leases equals 9,193 net mineral
        acres x
        $30/net mineral acres = $275,790.00. For example, if title to Leases worth
        $270,000.00 fails, then there will be no adjustment to the Cash Consideration,
        and if title to Leases worth $285,000.00 fails, the Cash Consideration would
        be
        reduced by $285,000.00, subject to the provisions of Section 7.1(c).
 
 A.  Teton
        represents that it has at least the NRI set forth on Exhibit A-2 for each
        of the
        Low NRI Leases.
  4.7  Compliance
        with Laws. Teton has not received a written notice of a material violation
        of any statute, law, ordinance, regulation, permit, rule or order of any
        federal, state, tribal or local government or any other governmental department
        or agency, or any judgment, decree or order of any court, applicable to the
        Assets or operations on the Assets, which remains uncured.
  4.8  Contracts
        and Agreements. None of the Hydrocarbons are subject to a sales contract and
        no person has any call upon, option to purchase or similar rights with respect
        to the production from the Assets. Except for the Purchase and Sale Agreement
        (Shallow Niobrara Gas Project) dated January 5, 2005 by and between ATEC
        Energy
        Ventures, LLC et al. as Sellers and Teton as Buyer (the “ATEC PSA,” a copy of
        which is attached as Exhibit F), the Assets are not subject to any area of
        mutual interest agreements or any farm-out or farm-in agreement under which
        any
        party thereto is entitled to receive assignments not yet made, or could earn
        additional assignments. None of the Assets is subject to (or has related
        to it)
        any tax partnership. Noble acknowledges the terms of the ATEC PSA and agrees
        to
        comply with those terms to the extent that they continue to affect the Assets,
        including without limitation, Article 5 - Area of Mutual Interest, Article
        6 -
        Mineral Interests and Article 10 - Rentals and Obligations.
  4
 **ARTICLE
        5** **Representations of Noble**
 
 Noble
        represents to Teton as follows:
  5.1  Existence.
        Noble is a corporation validly existing and in good standing under the laws
        of
        the State of Delaware and at Closing, will be duly qualified to own properties
        and carry on business in the State of Nebraska and Colorado and to hold record
        title to the Leases prior to receiving an assignment of an interest in the
        Leases.
  5.2  Due
        Authorization and Execution. This Agreement has been duly authorized,
        executed and delivered on behalf of Noble and all documents and instruments
        required hereunder to be executed and delivered by Noble shall have been
        duly
        authorized, executed and delivered. This Agreement does, and such documents
        and
        instruments will, constitute valid, legal and binding obligations of Noble
        in
        accordance with their terms subject to the effects of bankruptcy, insolvency,
        reorganization, moratorium and similar laws, as well as to principles of
        equity
        (regardless of whether such enforceability is considered in a proceeding
        in
        equity or at law).
  5.3  Power
        and Authority. Noble has all requisite power and authority to carry on its
        business as presently conducted, to enter into this Agreement on the terms
        described in this Agreement and to perform its other obligations under this
        Agreement. The consummation of the Transaction will not violate, nor be in
        conflict with, any provisions of (i) Noble’s governing documents, (ii) any other
        agreement or instrument to which Noble is a party or is bound, or (iii) any
        judgment, decree, order, statute, rule or regulation applicable to Noble.
  5.4  Brokers’
        Fees. Noble has not incurred any liability, contingent or otherwise, for
        brokers’ or finders’ fees relating to this Transaction for which Teton shall
        have any responsibility whatsoever.
  5.5  Litigation.
        There is no action, suit, proceeding, claim or investigation by any person,
        entity, administrative agency or governmental body pending or, to Noble’s
        knowledge, threatened against it before any governmental authority that impedes
        or is likely to impede Noble’s ability to consummate this Transaction.
  5.6  Securities
        Laws. Noble is familiar with the Assets and it is a knowledgeable,
        experienced and sophisticated investor in the oil and gas business. Noble
        understands and accepts the risks and absence of liquidity inherent in ownership
        of the Assets. Noble acknowledges that the Assets are or may be deemed to
        be
“securities” under the Securities Act of 1933, as amended, and certain
        applicable state securities or Blue Sky laws and that resales thereof may
        therefore be subject to the registration requirements of such acts. The Assets
        are being acquired solely for Noble’s own account for the purpose of investment
        and not with a view to resale, distribution or granting a participation therein
        in violation of any securities laws.
  5.7  Independent
        Investigation. Noble is experienced and knowledgeable in the oil and gas
        business and is aware of its risks. In entering into this Agreement, Noble
        acknowledges and affirms that it has relied and will rely solely on the terms
        of
        this Agreement and upon its independent analysis, evaluation and investigation
        of, and judgment with respect to, the business, economic, legal, tax or other
        consequences of this Transaction including its own estimate and appraisal
        of the
        extent and value of the petroleum, natural gas and other reserves of the
        Assets,
        the value of the Assets and future operation, maintenance and development
        costs
        associated with the Assets. Noble owns and operates other oil and gas properties
        similar in nature and kind to the Assets and is aware of the geologic factors
        and risks associated with operating oil and gas wells in the area of the
        Assets.
        Noble assumes the risk of drilling the Earning Wells in a timely manner and
        the
        potential variation of the cost of drilling the Earning Wells.
  5
 5.8  Due
        Diligence. Noble acknowledges that Teton is making the Records available to
        it and the opportunity to examine, to the extent it deems necessary in its
        sole
        discretion, all real property, personal property and equipment associated
        with
        the Assets. Except for the representations of Teton contained in this Agreement,
        Noble acknowledges and agrees that Teton has not made any representations
        or
        warranties, express or implied, written or oral, as to the accuracy or
        completeness of the Records or any other information relating to the Assets
        furnished or to be furnished to Noble or its representatives by or on behalf
        of
        Teton, including without limitation any estimate with respect to the value
        of
        the Assets, estimates or any projections as to reserves and/or events that
        could
        or could not occur, future operating expenses and future cash flow.
  5.9  Financial
        Resources. Noble has the financial resources available to pay the Cash
        Consideration and to drill all of the Earning Wells in accordance with the
        terms
        of this Agreement.
  **ARTICLE
        6** **Conditions Precedent to** **Closing**
  6.1  Breaches
        of Representations. If one Party believes the other Party has breached a
        representation set forth in this Agreement, the Party alleging the breach,
        shall
        give the other Party notice of the breach on or before five days prior to
        Closing, together with a detailed description of the breach and supporting
        documentation. The Parties’ remedies for breaches of representation are set
        forth in Section 4.6 for that
        Section and generally in Sections 6.2 and 6.3 and ARTICLE
        7 .
  6.2  Teton’s
        Conditions Precedent. The
        obligations of Teton at Closing are subject to the satisfaction or waiver
        at or
        prior to the Closing of the following conditions precedent:
 
 A.  A l l
        representations of Noble contained in this Agreement are true in all material
        respects (considering this Transaction as a whole) at and as of the Closing
        in
        accordance with their terms as if such representations were remade at and
        as of
        the Closing;
  B.  Noble
        has
        performed and satisfied all covenants and agreements required by this Agreement
        to be performed and satisfied by Noble at or prior to the Closing in all
        material respects; and
  C.  No
        order
        has been entered by any court or governmental agency having jurisdiction
        over
        the Parties or the subject matter of this Agreement that restrains or prohibits
        this Transaction and that remains in effect at the time of Closing.
  6
 6.3  No ble’s
        Conditions Precedent. The
        obligations of Noble at Closing are subject to the satisfaction or waiver
        at or
        prior to the Closing of the following conditions precedent:
 
 A.  All
        representations of Teton contained in this Agreement are true in all material
        respects at and as of the Closing in accordance with their terms as if such
        representations were remade at and as of the Closing;
  B.  Teton
        has
        performed and satisfied all covenants and agreements required by this Agreement
        to be performed and satisfied by Teton at or prior to the Closing in all
        material respects; and
  C.  No
        order
        has been entered by any court or governmental agency having jurisdiction
        over
        the Parties or the subject matter of this Agreement that restrains or prohibits
        this Transaction and that remains in effect at the time of Closing.
   **ARTICLE
        7** **** **Termination**
  7.1  Termination.
        This Agreement may be terminated in accordance with the following
        provisions:
 
 A.  by
        Teton
        if Teton’s conditions set forth in Section 6.2 are not satisfied through no
        fault of Teton, or are not waived by Teton, as of the Closing Date;
  B.  by
        Noble
        if Noble’s conditions set forth in Section 6.3 are not satisfied through no
        fault of Noble, or are not waived by Noble, as of the Closing Date;
        and
  C.  by
        either
        Party if the aggregate of adjustments to the Cash Consideration for breaches
        of
        representations exceeds $300,000.
  7.2  Liabilities
        Upon Termination.
  A.  Noble’s
        Breach. If Closing does not occur because Noble wrongfully fails to tender
        performance at Closing or otherwise breaches this Agreement prior to Closing,
        and Teton is ready and otherwise able to close, Teton shall retain the Deposit
        as liquidated damages. The remedy set forth herein shall be Teton’s sole and
        exclusive remedy for Noble’s wrongful failure to close hereunder and Teton
        expressly waives any and all other remedies, legal and equitable, that it
        otherwise may have had for Noble’s wrongful failure to Close.
  B.  Teton’s
        Breach. If Closing does not occur because Teton wrongfully fails to tender
        performance at Closing or otherwise breaches this Agreement prior to Closing,
        and Noble is ready and otherwise able to close, Teton shall promptly return
        the
        Deposit to Noble immediately after the determination that the Closing will
        not
        occur and pay
        Noble
        $300,000.00 as liquidated damages for Teton’s wrongful failure to close. The
        remedy set forth herein shall be Noble’s sole and exclusive remedy for Teton’s
        wrongful failure to close hereunder and Noble expressly waives any and all
        other
        remedies, legal and equitable, that it otherwise may have had for Teton’s
        wrongful failure to close.
  7
 **ARTICLE
        8** **Closing**
  8.1  Closing.
        The “Closing” of this Transaction shall be held on Friday, January 27, 2006 at
        the offices of Teton in Denver, Colorado, at 10:30 a.m. At Closing, the
        following events shall occur, each being a condition precedent to the others
        and
        each being deemed to have occurred simultaneously with the others:
  A.  Noble
        shall pay Teton $2,700,000.00 (the Cash Consideration, less the Deposit),
        as
        further adjusted pursuant to the terms of this Agreement, by wire transfer
        in
        immediately available funds to the bank account designated by Teton.
  B.  Noble
        shall provide Teton evidence that it has the insurance set forth in the
        applicable JOA (as defined in Section 14.1), and the necessary bonding and
        other
        documents in place to operate the Assets and drill the Earning Wells.
  C.  Noble
        and
        Teton each shall execute the JOA.
   **ARTICLE
        9** **The Earning Wells**
  9.1  Drill
        to Earn. After Closing, the Parties agree as follows:
  A.  The
        Earning Wells. Until March 1, 2007, Noble shall have the right to acquire an
        Undivided Interest in the Leases by drilling a total of 20 wells on the Lands
        to
        the Target Depth (collectively, the “Earning Wells”); such Earning Wells to be
        drilled under the following time table: 10 wells drilled on or before December
        31, 2006, and 10 wells drilled on or before March 1, 2007. The Earning Wells
        shall be drilled on locations on the Lands selected by Noble within the
        following acreage blocks: 10 wells within the boundaries of the Grant Complex,
        and 10 wells within the boundaries of the Chundy Complex, as both complexes
        are
        outlined on Exhibit B.
  B.  Target
        Depth. The term “Target Depth” shall mean the depth in an oil and gas well
        as shown on the daily drilling reports indicating that the well has been
        drilled
        through the base of the Niobrara formation. The term “base of the Niobrara
        Formation” means drilling through a depth of 200 feet below the top of the
        Niobrara Formation as found in the Schneller 1-26 Well, NW/NW of Section
        26,
        T10N, R39W, Perkins County, Nebraska. The day the well will be deemed to
        have
        been drilled shall be the date it reaches Target Depth, as show by the daily
        drilling reports.
  C.  Location
        of Each Earning Well. The Parties agree that Noble may select the physical
        location of the Earning Wells within the Chundy Complex and the Grant Complex.
  8
 9.2  Substitute Well. If Noble has commenced any well in accordance with this Agreement and
        thereafter encounters mechanical difficulties or impenetrable substances
        rendering further drilling of the well impractical (the “Compromised Well”),
        Noble will immediately plug and abandon the Compromised Well and commence
        the
        drilling of the Substitute Well within 30 days of the plugging and abandonment
        of the Compromised Well. In that event, the time frame within which Noble
        must
        drill the Earning Wells shall be extended by the time spent drilling the
        Compromised Well plus 30 days. “Commencement of Drilling” shall be the date
        Noble commences actual drilling operations on the well in question using
        a
        drilling rig capable to drill to Target Depth. If Noble does not commence
        drilling on the Substitute Well within the 30 days, the provisions of this
        Section shall not apply, and the time frame for drilling the Earning Wells
        shall
        not be extended.
  **ARTICLE
        10** **Well Costs for the Earning Wells**
  10.1  Definition
        of Well Costs for the Earning Wells. The term “Well Costs” for one of the
        Earning Wells means all of the actual costs of drilling, completing and
        connecting the Well to the “Production Infrastructure” as defined in Section
        18.17, including without limitation, title examination, permitting the well,
        establishing the well location, surveying, drilling, evaluating, logging,
        testing, completing and equipping a well, and installing all necessary flow
        lines to connect the well to the Production Infrastructure.
  10.2  Apportionment
        of Well Costs for the Earning Wells. The Parties agree that Noble shall bear
        100% of the Well Costs for the Earning Wells.
  10.3  Apportionment
        of Well Costs for the Subsequent Wells. The Parties agree to bear all of the
        costs associated with the drilling and completion of wells drilled after
        the
        Earning Wells (the “Subsequent Wells”) in accordance with their WI percentages
        in each well and the terms of this Agreement and the applicable JOA.
  10.4  Apportionment
        of Costs for Acquisition of Additional Seismic Data. The Parties agree to
        bear all of the third party costs associated with acquisition of additional
        seismic data, and the reprocessing thereof, as follows (“Additional Seismic
        Costs”): If Noble chooses to acquire additional seismic data covering the Lands
        in connection with drilling of the Earning Wells, Noble agrees to pay 100%
        of
        the Additional Seismic Costs. After Noble has drilled all of the Earning
        Wells,
        (i) Teton agrees to reimburse Noble for an undivided 25% of such Additional
        Seismic Costs, such payment to be made within 30 days of Teton’s receipt of a
        detailed invoice for such costs and (ii) the Parties agree to bear the costs
        of
        the acquisition of additional seismic data after Noble has drilled the Earning
        Wells in accordance with their WI percentages as set forth in the applicable
        JOA. If Noble does not drill all of the Earning Wells, at Teton’s sole option,
        Teton may acquire all of the additional seismic data, together with any
        reprocessing and related information, from Noble by paying Noble 100% of
        the
        Additional Seismic Costs.
  9
 **ARTICLE
        11** **Proceeds of Production from the Earning Wells**
  11.1  Noble
        Earning an Interest in the Assets. Prior to drilling all of the Earning
        Wells, as each of the Earning Wells is drilled and Noble pays 100% of Well
        Costs
        as set forth in Article 10, Noble shall own no interest in the Leases of
        record,
        but shall have the contractual right to receive the proceeds of production
        from
        Earning Wells drilled equal to Noble’s after earning interest in each of the
        Earning Wells - i.e., 60.75% NRI for the 81% NRI Leases and the NRI listed
        on
        Exhibit A-2 for the Low NRI Leases, proportionally reduced to the 75% WI
        assigned.
  11.2  Proportionate
        Reduction. The Parties acknowledge that Teton may not own 100% of the WI in
        the Lands covered by the Leases, and that other third parties may own an
        interest in the Lands. Accordingly, if and to the extent that Teton owns
        less
        than 100% of the WI in a particular interest comprising the Assets, Teton’s
        interest, and the interest earned by Noble, shall be reduced proportionately.
        The Parties acknowledge and agree that Noble will earn an undivided interest
        in
        the Assets owned by Teton, not an undivided interest in 100% of the WI under
        the
        Lands.
  **ARTICLE
        12** **Failure to Drill all of the Earning Wells**
  12.1  Failure
        to Drill. In its sole discretion, Noble may elect to drill or not drill the
        Earning Wells. If Noble has not drilled 10 of the Earning Wells by December
        31,
        2006, or if Noble has not drilled an additional 10 wells by March 1, 2007
        (for a
        total of 20 wells), (i) Noble’s right to drill additional oil and gas wells on
        the Assets shall terminate, (ii) Noble’s interest in the Assets shall be
        confined to the wellbores of the Earning Wells already drilled on the Assets,
        together with a leasehold interest necessary to produce only the wellbore
        of the
        drilled Earning Well, but without the right to drill additional wells on
        the
        portion of the Lease so assigned, (iii) Noble’s ownership interest in the
        Production Infrastructure, as set forth in Section 18.17, shall be confined
        to
        that portion of the Production Infrastructure already constructed as of the
        date
        it is determined that Noble has not drilled the Earning Wells, and Noble
        shall
        assign operation of the Production Infrastructure to Teton, (iv) the contract
        area under the JOA will be revised to include only the wellbores of the Earning
        Wells, (v) Noble shall provide Teton copies of any and all information and
        data
        that Noble has generated in connection with the drilling of the Earning Wells,
        and (vi) Noble shall have no further rights with respect to any information
        and
        data related in any way to the Assets. In addition, for each Earning Well
        not
        drilled on the Assets, Noble agrees to pay Teton $150,000.00 per well, such
        payment to be made to Teton by wire transfer of immediately available funds
        on
        or before January 15, 2007 if Noble fails to drill 10 wells by December 31,
        2006, or by March 15, 2007 if Noble has drilled 10 wells by December 31,
        2006
        but has not drilled an additional 10 wells by March 1, 2007.
  **ARTICLE
        13** **Assignment After Drilling all of the Earning Wells**
  13.1  Assignment.
        Teton’s assignment of the Assets to Noble shall be made within 15 business days
        after Noble drills all of the Earning Wells at a time and place mutually
        agreed
        to by the Parties (the “Assignment Meeting”). A condition precedent to Teton’s
        obligations to make the “Assignment” is that Noble shall have drilled all of the
        Earning Wells pursuant to the terms of this Agreement. At the Assignment
        Meeting, the following events shall occur, each being a condition precedent
        to
        the others and each being deemed to have occurred simultaneously with the
        others:
  10
 A.  Teton
        shall execute, acknowledge and deliver to Noble, an Assignment, Bill of Sale
        and
        Conveyance in the form attached as Exhibit D (the “Assignment”) in sufficient
        counterparts for recording in each county where the Assets are located,
        conveying the Undivided Interest in the Leases and Assets as of the Effective
        Time, (i) with a special warranty of real property title by, through and
        under
        Teton but not otherwise, and (ii) with all personal property and fixtures
        conveyed “AS IS, WHERE IS,” with no warranties whatsoever, express, implied or
        statutory, and (iii) free and clear of all liens and encumbrances created
        by,
        through or under Teton.
  B.  Teton
        shall execute, acknowledge and deliver to Noble, an assignment on the required
        governmental forms necessary to convey the Assets to Noble consistent with
        the
        terms of the Assignment.
  C.  Teton
        and
        Noble shall take such other actions and deliver such other documents as are
        contemplated by this Agreement.
   **ARTICLE
        14** **Joint Operating Agreement**
  14.1  Joint
        Operating Agreement. The
        Parties agree to conduct all operations on the Lands pursuant to the terms
        of
        the AAPL
        1989
        Model Form Operating Agreement in the form attached as Exhibit C (the “JOA”) and
        the
        terms of this Agreement. The JOA will name Noble as the Operator. Except
        for the
        apportionment of Well Costs for the Earning Wells as set forth above, the
        Parties agree to apportion all of the costs incurred in the development of
        the
        Lands in accordance with the WI ownership percentages as set forth in the
        JOA.
        However, if the JOA conflicts with this Agreement, then, this Agreement shall
        control to the extent of the conflict. The Parties agree to have three JOAs
        governing the operation of the Leases, all in form and substance similar
        to the
        JOA attached as Exhibit C, except the “Contract Areas” shall differ as follows:
        one JOA will cover the Grant Complex Area, one JOA will cover the Chundy
        Complex
        Area, and one JOA will cover the East Big Springs Complex, as those complexes
        are described on Exhibit B. If the Parties develop Leases outside those three
        complexes, the Parties agree to execute additional JOAs in form and substance
        similar to Exhibit C to govern the operation of those Leases. All references
        to
        JOA herein shall be deemed to be to the applicable JOA covering the contract
        area in question.
  **ARTICLE
        15** **Area of Mutual Interest**
  15.1  Area
        of Mutual Interest. Effective on the date of the Assignment, the Parties
        agree to create an Area of Mutual Interest (“AMI”) comprising all of the lands
        as set forth on Exhibit E. The AMI shall remain in force and effect as to
        all
        lands included within the AMI, including any renewal or extension of any
        Lease,
        for a period of five years. As used herein a renewal or extension of any
        Lease
        means any renewal Lease, extension or new Lease covering all or any portion
        of,
        or any interest in, the area covered by an expiring Lease taken before, or
        taken
        or contracted for within one year after, the expiration of the predecessor
        Lease. Thereafter, the Parties agree that the term of the AMI may be extended
        by
        the mutual agreement of the Parties. If Noble does not drill the Earning
        Wells,
        the AMI will be of no force and effect, and Noble agrees not to acquire any
        interest within the AMI, or compete with Teton within the AMI until after
        December 31, 2008.
  11
 15.2  Lands
        within the AMI. During the term of the AMI, if any Party (“Acquiring Party”)
        acquires, renews or extends any oil and gas lease or any interest therein,
        any
        royalties, overriding royalties, minerals, leased mineral interest or any
        farmout or other contract with respect thereto which affects lands lying
        within
        the AMI (“Oil and Gas Interest”), the Acquiring Party shall, in writing, advise
        the non-acquiring Party (“Offeree”) of such acquisition. The Parties acknowledge
        that the acquisition of any royalties, overriding royalties and minerals
        within
        the boundaries of the AMI will be subject to the terms of the ATEC PSA, and
        the
        Parties agree to comply in all respects with the terms of the ATEC PSA. The
        notice shall include a copy of all instruments of acquisition including,
        without
        limitation, copies of the leases, assignments, subleases, title reports and
        run
        sheets, farmouts or other contracts affecting the Oil and Gas Interest. The
        Acquiring Party shall also enclose an itemized statement of the actual costs
        of
        the acquisition, which will be equal to 110% of the actual cash amount paid
        by
        the Acquiring Party to the lessor, assignor of farmor (collectively “Acquisition
        Costs”). For the avoidance of doubt, the 110% has been purposefully selected by
        the Parties with the understanding that the additional 10% will be deemed
        full
        compensation and reimbursement for all costs, fees and expenses associated
        with
        securing such leases or rights, and that no additional charges will be imposed
        and expenses incurred by the Acquiring Party in acquiring such Oil and Gas
        Interest (collectively “Acquisition Costs”). Other than the Teton ORRI as
        defined below, the Acquiring Party shall not place any additional burdens
        on the
        Oil and Gas Interests.
  15.3  Interest
        to be Acquired. The Offeree shall have the right to acquire based on the
        following percentages:
 
 Noble
        -
        75% WI/60.75%NRI, subject to Section 15.4
 Teton
        -
        25% WI plus the Teton ORRI
 
 The
        acquisition percentages set forth above assume that Noble has drilled the
        Earning Wells and that Teton has executed the Assignment to Noble. The Parties
        acknowledge that the Oil and Gas Interests so acquired may be burdened so
        that
        Noble may not be able to acquire a 60.75% NRI in such Lease.
  15.4  Teton
        Overriding Royalty Interest. All interests, except Mineral Interests as
        defined in Section 15.8, acquired within the AMI shall be subject to a
        reservation of an overriding royalty in favor of Teton equal to the difference
        between existing leasehold burdens and 19% (the “Teton ORRI). It is the intent
        of the Parties that Noble receive a 75% WI and 60.75% NRI (an equivalent
        81% net
        revenue interest); however, if and to the extent that the Oil and Gas Interest
        so acquired is subject to leasehold burdens exceeding 19%, the NRI assigned
        to
        Noble will be reduced accordingly and Teton will not reserve the Teton ORRI.
  15.5  Mechanics.
        The Offeree shall have a period of 30 days after receipt of the notice within
        which to furnish the Acquiring Party written notice of its election to acquire
        its proportionate interest in the offered Oil and Gas Interest. However,
        if a
        well in search of oil or gas is being drilled by a third party within three
        miles of the offered Oil and Gas Interest, the Offeree shall have 10 days
        after
        hand delivery and personal receipt of the notice within which to elect to
        acquire its proportionate interest in the offered Oil and Gas Interest. In
        addition thereto, the Acquiring Party shall also (i) furnish the Offeree
        with
        the approximate location of the well then being drilled and the name of the
        Operator or drilling contractor drilling the well, and (ii) specifically
        advise
        the Offeree that the Offeree shall have 10 days within which to elect to
        acquire
        an interest in the offered Oil and Gas Interest.
  12
 15.6  Election.
        If the Acquiring Party has not received actual written notice of election
        of the
        Offeree to acquire its proportionate interest within the 30-day or 10 business
        day period, as the case may be, such failure shall constitute an election
        by
        such Offeree not to acquire its interest in the Oil and Gas Interest. The
        Offeree accepting the offered Oil and Gas Interest shall be entitled to
        participate in its undivided percentage of the Oil and Gas Interest so offered.
        Promptly after the time for the election expires, the Acquiring Party shall
        invoice the Offeree electing to acquire an interest for its proportionate
        share
        of the Acquisition Costs. The Offeree shall promptly reimburse the Acquiring
        Party for its share of the Acquisition Costs as reflected by the invoice.
        Upon
        receipt of such reimbursement, the Acquiring Party shall execute and deliver
        an
        appropriate assignment to the Offeree containing a reservation of the Teton
        ORRI
        or be made subject to the Teton ORRI. If the Acquiring Party is Noble, they
        shall, at the same time, also execute an Assignment of Overriding Royalty
        Interest to Teton of an overriding royalty interest equal to the Teton ORRI.
        If
        the Acquiring Party does not receive the amount due from the Offeree within
        30
        days after receipt by the Offeree of the invoice for its costs, the Acquiring
        Party may, at its election, give written notice to such delinquent Party
        that
        the failure of the Acquiring Party to receive the amount due within 30 days
        after receipt of such written notice by the delinquent Offeree shall constitute
        a withdrawal by the delinquent Offeree of its former election to acquire
        the
        interest, and the Offeree shall no longer have the right to acquire an interest
        in the offered Oil and Gas Interest.
  15.7  Assignment.
        Any assignment made by the Acquiring Party shall reserve the Teton ORRI or
        be
        made subject to the Teton ORRI, and be made free and clear of any burdens
        placed
        thereon by the Acquiring Party (except the Teton ORRI), and with special
        warranty of title as to matters arising by, through or under the Acquiring
        Party, but not otherwise. The assignment shall be made and accepted subject
        to,
        and each assignee shall expressly assume, its portion of all of the obligations
        of the Acquiring Party. If the Acquiring Party is Noble, they shall assign
        to
        Teton their proportionate share of the Teton ORRI.
  15.8  Royalty,
        Overriding Royalty and Mineral Interests. The Parties acknowledge that the
        acquisition of any royalties, overriding royalties and minerals (“Mineral
        Interest”) within the boundaries of the AMI will be subject to the terms of the
        ATEC PSA, and the Parties agree to comply in all respects with the terms
        of the
        ATEC PSA. If either Party does acquire a Mineral Interest in the AMI, it
        will
        offer half of the interest so acquired pursuant to Paragraph 6 of the ATEC
        PSA,
        with the remaining half to be handled in accordance with the notice, mechanics,
        election and assignment requirements as spelled out in this Article 15;
        accordingly, Noble will be offered 75% and Teton will be offered 25% of this
        remaining one-half interest (or entire interest if ATEC declines) in exchange
        for each Party’s payment of their proportionate share of the Acquisition Costs.
  13
 15.9  Interests
        Inside and Outside the AMI . If
        the
        Oil and Gas Interest covers lands both inside and outside the AMI, the Acquiring
        Party must offer the entire Oil and Gas Interest both inside and outside
        the
        AMI. If the Acquiring Party acquires an Oil and Gas Interest pursuant to
        two oil
        and gas leases covering a contiguous mineral interest, part of which lies
        within
        the boundaries of the AMI, with one lease being inside the AMI and one lease
        being outside the AMI, the Acquiring Party shall offer both the oil and gas
        lease inside the AMI and outside the AMI as part of the Oil and Gas Interest.
        If
        each Party acquires its proportionate interest in the offered Oil and Gas
        Interest, the lands lying outside the AMI will become subject to the JOA
        and the
        terms of this Agreement, but the AMI shall not thereby be enlarged. If less
        than
        all Parties acquire their proportionate interest in the Oil and Gas Interest,
        the Oil and Gas Interest so acquired shall not be subject to the terms of
        this
        Agreement.
  15.10  Separate
        Interests Offered. If two or more separate Oil and Gas Interests are
        included in the same notice, the Offeree shall have the separate right of
        election as to each separate Oil and Gas Interest.
  15.11  Merger/Consolidation.
        The provisions of this AMI shall not apply to (i) acquisitions as a result
        of
        merger, consolidation, reorganization, (ii) an acquisition from a parent,
        subsidiary, or affiliated corporation existing as of the Effective Time,
        and
        (iii) sales or acquisitions between partners in a partnership or venturers
        in a
        joint venture.
  15.12  Acquisitions
        Before Noble Drills the Earning Wells. In connection with the drilling of
        the Earning Wells, Noble agrees to use its commercially reasonable efforts
        to
        acquire any unleased interest within the applicable drilling and spacing
        unit
        for an Earning Well. Such acquired Oil and Gas Interest shall be acquired
        by the
        Parties in proportion to their after earning WI in the Leases and Lands -
        75% WI
        Noble - 25% WI Teton. If Noble does not drill all of the Earning Wells and
        the
        Assignment is not made, and if Teton so requests, Noble agrees to assign
        all of
        its interest in the Oil and Gas Interest and any Mineral Interest so acquired
        to
        Teton and Teton agrees to pay Noble 110% of the Acquisition Costs of such
        interest. If Teton elects not to acquire such interests, Noble shall keep
        such
        interest for its own account. With respect to other Oil and Gas Interests
        and
        Mineral Interests outside the drilling and spacing unit of the Earning Wells,
        if
        Noble makes an AMI acquisition prior to Noble earning its interest by drilling
        the Earning Wells, Noble shall offer the entire interest to Teton under the
        provisions of this Article, with Teton having the right to acquire the entire
        interest at 110% of Noble’s actual cost. If Teton elects to acquire such Oil and
        Gas Interest and Mineral Interest, the interest so acquired shall become
        part of
        the Assets. If Teton makes an AMI acquisition prior to Noble earning its
        interest by drilling the Earning Wells, Teton will acquire the interest for
        its
        own account and, after Noble earns its interest by drilling the Earning Wells,
        Teton shall offer such acquired Oil and Gas Interest to Noble on the same
        terms
        and conditions as set forth in this Agreement.
  **ARTICLE
        16** **Liabilities and Obligations**
  16.1  Apportionment
        of Liabilities and Obligations. Teton and Noble agree to apportion all
        liabilities and obligations associated with the ownership and operation of
        the
        Assets after the Effective Time as follows: All liabilities and obligations
        associated with the Assets will be apportioned between the Parties in
        proportion to their respective cost bearing interests in the Assets prior
        to all
        of the Earning Wells being drilled (as set forth in Article 10 above), and
        after
        that time, in proportion to their respective WIs in the Assets at the time
        the
        liability and/or obligation was incurred, subject to the terms of this Agreement
        and the JOA. The liabilities and obligations so assumed by Teton shall be
        referred to as the “Teton Liabilities,” and the liabilities and obligations so
        assumed by Noble shall be referred to as the “Noble Liabilities.”
 
 14
 A.  The
        Parties agree to apportion liabilities for environmental matters associated
        with
        pre-Effective Time oil and gas activities on the Lands (“Environmental Matters”)
        as follows: Teton agrees to indemnify Noble for any Losses related to an
        Environmental Matters if Noble gives Teton written notice on or before December
        29, 2006 at 5:00 p.m. MST of a violation of an environmental law at a particular
        site, together supporting documentation, describing the violation in detail
        (the
“Environmental Notice”). A condition precedent to Teton’s indemnification
        obligation in this subsection A. is timely receipt of the Environmental Notice.
        If Teton disputes whether the Environmental Matter described in the
        Environmental Notice is a violation of an environmental law, the Parties
        agree
        to submit such dispute to binding arbitration to be conducted by the Judicial
        Arbiter Group (“JAG”) in Denver using the AAA commercial arbitration rules. If
        the Environmental Notice is timely received and not contested, the Environmental
        Matter described in the Environmental Notice, and only the Environmental
        Matters
        described in the Environmental Notice, shall be deemed to be part of the
        Teton
        Liabilities. The Parties agree that Teton’s indemnification of Noble for such
        Environmental Matters shall not (i) obligate Teton to remediate or clean
        up the
        site giving rise to the violation of environmental law, (ii) create any rights
        in third parties; and shall not be construed as an admission of liability
        by
        either Party. The Parties agree that Teton will only indemnify Noble for
        the
        specific sites identified in the Environmental Notices; and, except for the
        sites identified in the Environmental Notices, Teton will not indemnify Noble
        for any pre-Effective Time environmental liability related to oil and gas
        activities on the Lands.
  16.2  Indemnification/Release.
        “Losses” shall mean any actual losses, costs, expenses (including court costs,
        reasonable fees and expenses of
        attorneys, technical experts and expert witnesses and the cost of
        investigation), liabilities, damages, demands, suits, claims, and sanctions
        of
        every kind and character (including civil fines) arising from, related to
        or
        reasonably incident to matters indemnified against; excluding however, any
        special, consequential, punitive or exemplary damages, diminution of value
        of an
        Asset, loss of profits incurred by a Party hereto or Loss incurred as a result
        of the indemnified Party indemnifying a third party. After the Closing, the
        Parties shall indemnify each other as follows:
  A.  Teton’s
        Indemnification of Noble. Teton
        assumes all risk, liability, obligation and Losses in connection with, and
        shall
        defend, indemnify, and save and hold harmless Noble, its officers, directors,
        employees and agents, from and against all Losses which arise from or in
        connection with the Teton Liabilities.
  B.  Noble’s
        Indemnification of Teton. Noble
        assumes all risk, liability, obligation and Losses in connection with, and
        shall
        defend, indemnify, and save and hold harmless Teton, its respective officers,
        directors, employees and agents, from and against all Losses which arise
        from or
        in connection with the Noble Liabilities.
  15
 C.  No
        Insurance/Subrogation. The
        indemnifications provided in this Agreement shall not be construed as a form
        of
        insurance. Teton and Noble each hereby waive for themselves, their respective
        successors or assigns, including, without limitation, any insurers, any rights
        to subrogation for Losses for which each of them is respectively liable or
        against which each respectively indemnifies the other, and, if required by
        applicable policies, Teton and Noble shall obtain waiver of such subrogation
        from their respective insurers
  D.  Release. Noble
        shall be deemed to have released Teton at Closing from any Losses for which
        Noble has agreed to indemnify Teton hereunder, and Teton shall be deemed
        to have
        released Noble at the Closing from any Losses for which Teton has agreed
        to
        indemnify Noble hereunder.
  **ARTICLE
        17**  **Rentals**
  17.1  Rentals . Teton
        agrees to retain the obligation to pay all of the leasehold rental obligations
        related to the Leases through March 31, 2007. If Noble drills the Earning
        Wells
        and receives the Assignment, Noble, as the operator under the JOA, and Noble
        agrees to assume the obligation to pay all leasehold rental obligations pursuant
        to the terms of the Leases. Contemporaneously with the execution of the
        Assignment, Noble agrees to reimburse Teton for its proportionate share (75%
        WI)
        of the rentals paid by Teton for the period of time from the Effective Time
        forward. Teton shall use its good faith efforts to make all leasehold rental
        payments attributable to the Leases from the Effective Time through the
        anticipated date of execution of the Assignment, but Teton shall incur no
        liability whatsoever for any mispayment of the leasehold rental obligations.
  **ARTICLE
        18** **Miscellaneous**
  18.1  Assignment.
        Prior to drilling all of the Earning Wells, Noble may not assign its interest
        in
        this Agreement, without the express written consent of Teton, which may be
        withheld for any reason or no reason. After drilling the Earning Wells, Noble
        may assign or transfer its interest in and to this Agreement, but any such assignment or
        transfer shall nevertheless be void unless it is made expressly subject to
        this
        Agreement. At any time, Teton may assign its interest in this Agreement,
        but any
        such assignment or transfer shall nevertheless be void unless it is made
        expressly subject to this Agreement. The terms of this Agreement shall be
        binding upon and inure to the benefit of each Party’s respective successors and
        assigns.
  18.2  Relationship
        of the Parties . With
        respect to this Agreement, each Party shall not be considered the agent,
        partner, employee or fiduciary of any other Party, nor shall this Agreement
        be
        construed as creating a mining partnership or other partnership or association.
        Each Party shall be responsible only for its obligations as provided in this
        Agreement and shall be liable only for its proportionate share of the costs
        of
        performing its obligations under this Agreement. All of the obligations and
        liabilities under this Agreement shall be several and not joint or collective.
        Unless the Parties so elect under the terms of the JOA, the Parties elect
        not to
        be treated as a partnership under the Internal Revenue Code of 1986 or under
        any
        Income Tax Laws of the State of Nebraska or Colorado, and specifically elect
        to
        be excluded from all such provisions hereof.
  16
 18.3  Compliance
        with Laws. This Agreement and all operations hereunder shall be subject to
        all valid and applicable Federal and State laws, and all valid and applicable
        orders, laws, rules and regulations of any Federal or State authority having
        jurisdiction, but nothing contained herein shall be construed as a waiver
        of any
        right to question or contest any such law, order, rule or regulation in any
        forum having jurisdiction within the premises.
  18.4  Notices.
        All notices, reports or information to be furnished or given hereunder shall
        be
        deemed given when received by facsimile, overnight courier, personal delivery
        or
        U.S. mail at the following addresses unless notified by the Parties in writing
        to the contrary:
 
 Teton
        Energy Corporation
 1401
        17 th Street,
        Suite 1000
 Denver,
        Colorado 80202
 Attn:
        Karl F. Arleth
 (303)
        565-4600
 Fax
        (303)
        565-4606
 
 Noble
        Energy, Inc.
 1625
        Broadway, Suite 2000
 Denver,
        Colorado, 80202
 Attn:
        Gary W. Willingham
 (303)
        389-3600
 Fax:
        (303) 595-7411
  18.5  Headings.
        The heading of the paragraphs and/or sections of this Agreement are for
        convenience only and shall not control or affect the meaning or construction
        of
        the terms and provisions hereof.
  18.6  Mutuality.
        The Parties acknowledge and declare that this Agreement is the result of
        extensive negotiations between themselves. Accordingly, if there is any
        ambiguity in this Agreement, there shall be no presumption that this instrument
        was prepared solely by either Party.
  18.7  Entire
        Agreement. This Agreement constitutes the entire understanding among the
        Parties, their respective partners, members, trustees, shareholders, officers,
        directors and employees with respect to the subject matter hereof, superseding
        all negotiations, prior discussions and prior agreements and understandings
        relating to such subject matter.
  18.8  Counterparts/Facsimile
        Signatures. This Agreement may be executed by the Parties in any number of
        counterparts, each of which shall be deemed an original instrument, but all
        of
        which together shall constitute but one and the same instrument. Facsimile
        signatures are considered binding.
  18.9  Governing
        Law. This Agreement shall be governed, construed and enforced in accordance
        with the laws of the State of Colorado. The exclusive venue for the resolution
        of any dispute hereunder shall be the state and federal courts located in
        Denver, Colorado.
  17
 18.10  Exhibits.
        The Exhibits referred to in this Agreement are hereby incorporated in this
        Agreement by reference and constitute a part of this Agreement.
  18.11  Expenses.
        All fees, costs and expenses incurred by a Party in negotiating this Agreement
        or in consummating the Transaction shall be paid by the Party incurring the
        same, including, without limitation, engineering, land, title, legal and
        accounting fees, costs and expenses.
  18.12  Confidentiality.
        The Parties agree to keep the terms of this Agreement confidential, except
        as
        disclosure may be required by applicable law, rules and regulations of
        governmental agencies or stock exchanges. If a Party (“Disclosing Party”) is
        required by any court or legislative or administrative body (by oral questions,
        interrogatories, requests for information or documents, subpoena, civil
        investigative demand or similar process) to disclose any Confidential
        Information or Notes, the Disclosing Party shall provide the other Party
        (the
“Other Party”) with prompt notice of each such requirement in order to afford
        Other Party an opportunity to seek an appropriate protective order and/or
        waive
        the Disclosing Parties’ obligation to comply with the provisions of this
        Agreement. Further, if in the absence of a protective order or the receipt
        of
        waiver hereunder, Disclosing Party is, in the opinion of its counsel, compelled
        to disclose Confidential Information or Notes (under penalty of contempt
        or
        other censure), Disclosing Party may disclose only the request Confidential
        Information and Notes in response to such process without liability hereunder,
        provided, however, that Disclosing Party shall take all practicable measures
        to
        assure that, to the extent possible, confidential treatment will be accorded
        to
        any such Confidential Information or Notes disclosed.
  18.13  Further
        Assurances. The Parties agree to execute, acknowledge and deliver any
        additional instruments, agreements or other documents and to do any other
        acts
        and things which may by necessary to more fully and effectively accomplish
        the
        intent of the Parties as set forth in this Agreement.
  18.14  No
        Third-Party Beneficiaries. This
        Agreement is intended to benefit only the Parties hereto and their respective
        permitted successors and assigns.
  18.15  Force
        Majeure. If any Party is rendered unable, in whole or in part, by Force
        Majeure to carry out its obligations under this Agreement, other than the
        obligation to make money payments, that Party shall give to all other Parties
        prompt written notice of the Force Majeure with reasonably full particulars
        concerning it; thereupon, the obligations of the Party giving the notice,
        insofar as it is affected by the Force Majeure, shall be suspended during,
        but
        no longer than, the continuance of the Force Majeure. The affected Party
        shall
        use all reasonable diligence to remove the Force Majeure situation as quickly
        as
        practicable. The requirement that any Force Majeure shall be remedied with
        all
        reasonable dispatch shall not require the settlement of strikes, lockouts,
        or
        other labor difficulty by the Party involved, contrary to its wishes; the
        manner
        in which such difficulties are handled shall be entirely within the discretion
        of the Party concerned. The term “Force Majeure,” shall mean an act of God,
        strike, lockout, or other industrial disturbance, act of public enemy, war,
        blockade, public riot, lightning, fire, storm, flood, explosion, governmental
        action or inaction, governmental delay or restraint, unavoidable administrative
        delay, and any other cause, other than financial, whether of the kind
        specifically enumerated above or otherwise, which is not reasonably within
        the
        control of the Party claiming suspension. Failure to obtain a permit to be
        used
        in connection with drilling the Earning Wells in a timely manner, unavailability
        of drilling rigs, equipment or materials used in connection with drilling
        the
        Earning Wells shall not be considered events of Force Majeure.
  18
 18.16  Survival/Time
        of the Essence. The representations set forth in Sections 4.6, 4.7 and 4.8
        shall not survive Closing, and a claim for a breach of those representations
        must be made by Noble on or before Closing. The remaining representations
        set
        forth in Article 4 and Article 5 shall survive the Closing without limitation
        as
        to time. Time shall be considered of the essence when interpreting this
        Agreement.
  18.17  Gathering
        System/Gas Marketing. After Closing, and pursuant to the terms of the JOA,
        the Parties agree to (i) jointly construct the gathering system and all other
        infrastructure necessary to gather the Hydrocarbons produced from the Assets
        and
        transport it to market, and dispose of any produced waters (collectively,
        the
“Production Infrastructure”) and (ii) to bear the costs of such Production
        Infrastructure 75% Noble - - 25% Teton. The Parties agree to market all of
        the
        Hydrocarbons pursuant to the terms of the JOA, unless the Parties enter into
        a
        mutually acceptable retail or interstate gas marketing agreement.
  18.18  Right
        of First Offer. If a Party to this Agreement wishes to sell or otherwise
        divest all or part of its interest in the Lands (“Selling Party”), the Selling
        Party shall give notice to the other Party (the “Offer Party”), of the terms and
        conditions under which it is willing to divest such interests. The Offer
        Party
        shall have a period of 10 business days after receipt of the notice to purchase
        the offered interest for the consideration and under the terms and conditions
        stated in the notice from the Selling Party. If the Offer Party elects to
        purchase the offered interest that Party shall purchase all of such interests.
        If the Offer Party elects not to acquire such offered interest, or fails
        to
        elect, then the Selling Party shall be free to divest such interests on terms
        equal to or greater than those offered to the Offer Party. If the Selling
        Party
        does not divest such interest within 90 days of offering same to the Offer
        Party
        or decreases the terms or materially changes the terms and conditions of
        the
        trade, the Selling Party shall give notice to the Offer Party of the changes
        and
        the Offer Party again shall have a period of 10 business days to evaluate
        those
        terms and conditions and notify the Selling Party of its decision to acquire
        or
        not acquire such interest.
  18.19  Press
        Releases. The Parties acknowledge that Teton will be making a press release
        after the execution of this Agreement. Teton agrees to provide Noble a draft
        of
        such press release on or before two business days prior to its scheduled
        release
        date for Noble’s consent, such consent not to be unreasonably withheld.
        Thereafter, until the Earning Wells have been drilled, either Party may make
        a
        press release at any time regarding the Transaction, provided however, that
        the
        Party making the press release shall provide the other Party a draft of such
        press release two business days prior to the scheduled release of the press
        release for that Party’s consent, such consent not to be unreasonably withheld.
        The Parties agree to grant consent to the other Party’s press release if the
        substance of the press release is the same as the substance of any related
        filing made with the SEC. After the Earning Wells have been drilled, either
        Party may make a press release regarding the development of the Leases and
        Lands
        without the consent of the other Party. The Party making the press release
        agrees to provide the other Party with a copy of the final press release
        contemporaneously with its release to the public.
 
 19
 IN
        WITNESS WHEREOF, this Agreement has been duly executed on the dates set forth
        in
        the acknowledgments below.
 
 **Teton
        Energy Corporation**
 
 
 By:
        ___________________________________
 Patrick
        A. Quinn, Chief Financial Officer
 
 **Noble
        Energy, Inc.**
 
 By:
        ____________________________________
 Name:
        Charles D. Davidson, President and
 Chief
        Executive Officer
  20
 **ACKNOWLEDGMENTS**
  
 STATE OF COLORADO
              )CITY AND
              )
                ss.COUNTY OF DENVER
              )
 
 The
        foregoing instrument was acknowledged before me this 28th day of December
        2005
        by Patrick A. Quinn, as Chief Financial Officer of Teton Energy Corporation,
        a
        Delaware Corporation, on behalf of said corporation.
 
 Witness
        my hand and official seal.
 My
        commission expires: ______________
 
 
 Notary Public
 STATE OF TEXAS
                )CITY AND
                )
                  ss.COUNTY OF HARRIS
                )
 
 The
        foregoing instrument was acknowledged before me this __ day of December 2005
        by
        Charles D. Davidson, President and Chief Executive Officer of Noble Energy,
        Inc., a Delaware Corporation, on behalf of said corporation.
 
 Witness
        my hand and official seal.
 My
        commission expires: ______________
 
 Notary Public
 21