<PAGE>

                                                                   EXHIBIT 10.25

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                         KHANTY MANSIYSK OIL CORPORATION

                            SHARE PURCHASE AGREEMENT

                                   dated as of

                               September 24, 1999

                                 by and between

                         KHANTY MANSIYSK OIL CORPORATION

                                       AND

                      ENTERPRISE OIL OVERSEAS HOLDINGS LTD

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                                TABLE OF CONTENTS

                                    ARTICLE I

                                PURCHASE AND SALE

SECTION 1.1  PURCHASE AND SALE OF THE COMMON STOCK .........................  1
SECTION 1.2  CONSIDERATION .................................................  1
SECTION 1.3  ADJUSTMENT FOR COMMON STOCK ISSUANCE ..........................  2
SECTION 1.4  ADJUSTMENT PROCEDURE ..........................................  2
SECTION 1.5  CLOSING .......................................................  2

                                   ARTICLE II

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

SECTION 2.1  CORPORATE ORGANIZATION ........................................  2
SECTION 2.2  CAPITAL STOCK .................................................  3
SECTION 2.3  ISSUANCE OF SECURITIES ........................................  3
SECTION 2.4  AUTHORIZATION, ETC.............................................  3
SECTION 2.5  FINANCIAL STATEMENTS ..........................................  4
SECTION 2.6  NO APPROVALS OR CONFLICTS .....................................  4
SECTION 2.7  COMPLIANCE WITH LAW; GOVERNMENTAL AUTHORIZATIONS ..............  4
SECTION 2.8  LICENSED INTERESTS ............................................  4
SECTION 2.9  LITIGATION OR OTHER PROCEEDINGS ...............................  5
SECTION 2.10 TAXES .........................................................  5
SECTION 2.11 LABOR RELATIONS ...............................................  5
SECTION 2.12 PATENTS, TRADEMARKS, TRADE NAMES, ETC..........................  5
SECTION 2.13 ENVIRONMENTAL MATTERS .........................................  5
SECTION 2.14 NO BROKERS' OR OTHER FEES .....................................  6
SECTION 2.15 FOREIGN CORRUPT PRACTICES ACT .................................  6
SECTION 2.16 ENVIRONMENTAL MATTERS .........................................  6
SECTION 2.17 RELIANCE BY THE PURCHASER .....................................  6
SECTION 2.18 NO PUBLIC SOLICITATION ........................................  6

                                   ARTICLE III

                   REPRESENTATIONS AND WARRANTIES OF PURCHASER

SECTION 3.1  INFORMATION RECEIVED ..........................................  6
SECTION 3.2  INVESTMENT EXPERIENCE .........................................  6
SECTION 3.3  NONDISTRIBUTIVE INTENT ........................................  7
SECTION 3.4  SECURITIES NOT REGISTERED .....................................  7
SECTION 3.5  ACCREDITED INVESTOR ...........................................  7
SECTION 3.6  LEGEND ON SECURITIES ..........................................  7
SECTION 3.7  ACKNOWLEDGMENT OF RISK ........................................  7
SECTION 3.8  ORGANIZATION; PARENT ..........................................  7
SECTION 3.9  AUTHORIZATION .................................................  7
SECTION 3.10 BROKERS' FEES .................................................  7
SECTION 3.11 NO APPROVALS OR CONFLICTS .....................................  7
SECTION 3.12 NO PUBLIC MARKET ..............................................  7
SECTION 3.13 RELIANCE BY THE COMPANY .......................................  7


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SECTION 3.14 NO PUBLIC SOLICITATION ........................................  8
SECTION 3.15 AVAILABILITY OF FUNDS .........................................  8

                                   ARTICLE IV

                              CONDITIONS TO CLOSING

SECTION 4.1 CONDITIONS TO OBLIGATIONS OF PURCHASERS ........................  8
SECTION 4.2 CONDITIONS TO OBLIGATIONS OF COMPANY ...........................  8
SECTION 4.3 WAIVER .........................................................  9

                                   ARTICLES V

                               CLOSING DELIVERIES

SECTION 5.1 BY THE COMPANY .................................................  9
SECTION 5.2  BY THE PURCHASER ..............................................  9

                                   ARTICLE VI

                            COVENANTS OF THE PARTIES

SECTION 6.1 FINANCIAL INFORMATION ..........................................  9
SECTION 6.2 ACCESS TO BOOKS AND RECORDS; COOPERATION ....................... 10
SECTION 6.3 PUBLICITY ...................................................... 10
SECTION 6.4 FILINGS AND CONSENTS ........................................... 10
SECTION 6.5 COVENANT TO SATISFY CONDITIONS ................................. 10
SECTION 6.6 WITHHOLDING TAXES .............................................. 10
SECTION 6.7 COMPANY PLACEMENT .............................................. 10

                                   ARTICLE VII

                               REGISTRATION RIGHTS

SECTION 7.1 REGISTRATION RIGHTS ............................................ 11

                                  ARTICLE VIII

                            TRANSFER OF COMMON STOCK

SECTION 8.1 TRANSFER RESTRICTIONS .......................................... 11

                                   ARTICLE IX

                                 INDEMNIFICATION

SECTION 9.1 INDEMNITY FROM THIRD PARTY CLAIMS .............................. 11


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                                    ARTICLE X

                                   TERMINATION

SECTION 10.1 TERMINATION ................................................... 12
SECTION 10.2 PROCEDURE AND EFFECT OF TERMINATION ........................... 12

                                   ARTICLE XI

                                 CONFIDENTIALITY

SECTION 11.1 CONFIDENTIAL INFORMATION ...................................... 13
SECTION 11.2 EXCLUSIONS .................................................... 13

                                   ARTICLE XII

                                PURCHASER OPTION

SECTION 12.1 OPTION ........................................................ 13
SECTION 12.2 TRANSACTION NOTICE ............................................ 13
SECTION 12.3 EXERCISE OF OPTION ............................................ 14

                                  ARTICLE XIII

                                  MISCELLANEOUS

SECTION 13.1 WAIVERS AND AMENDMENTS ........................................ 14
SECTION 13.2 GOVERNING LAW ................................................. 14
SECTION 13.3 SURVIVAL ...................................................... 14
SECTION 13.4 SUCCESSORS AND ASSIGNS ........................................ 15
SECTION 13.5 ENTIRE AGREEMENT .............................................. 15
SECTION 13.6 NOTICES ....................................................... 15
SECTION 13.7 ATTORNEYS' FEES ............................................... 16
SECTION 13.8 SEVERABILITY .................................................. 16
SECTION 13.9 CAPTIONS ...................................................... 16
SECTION 13.10 COUNTERPARTS ................................................. 16
SECTION 13.11 KNOWLEDGE .................................................... 16


                                       iii
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                                    EXHIBITS

Exhibit A - Form of Amendment to the Note Purchase Agreement
Exhibit B - Financial Statements
Exhibit C - Shareholder Agreement
Exhibit D - Disclosure Schedule
Exhibit E - Senior Financing Investors
Exhibit F - Required Consents and Waivers


                                       iv
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                             INDEX OF DEFINED TERMS
                                                                            Page

Affiliate .................................................................. 11
Assets .....................................................................  4
Closing ....................................................................  2
Closing Date ...............................................................  2
Common Stock ...............................................................  1
Company ....................................................................  1
Contract ...................................................................  3
Control .................................................................... 11
Disclosure Schedule ........................................................  2
Enterprise Costs ...........................................................  1
Encumbrances ...............................................................  3
Environmental Laws .........................................................  5
Evaluated Properties .......................................................  4
FCPA .......................................................................  6
Financial Statements .......................................................  3
fully diluted .............................................................. 13
IPO ........................................................................ 13
KMNGG ......................................................................  4
Majority Subsidiaries ......................................................  2
Material Adverse Effect ....................................................  2
Minority Subsidiaries ......................................................  2
Notes ......................................................................  1
Option Stock ............................................................... 13
Option Purchase Price ...................................................... 13
Parent .....................................................................  1
Permitted Transferee .......................................................  9
person .....................................................................  3
Public Disclosures ......................................................... 10
Purchaser ..................................................................  1
Related Agreements .........................................................  3
Representatives ............................................................ 13
Securities .................................................................  6
Securities Act .............................................................  6
Senior Debt ................................................................  8
Senior Financing ...........................................................  6
Service Agreement ..........................................................  1
Shareholder Agreement ......................................................  9
Stock-Related Instruments ..................................................  3
Stockholders ...............................................................  3
Subsidiaries ...............................................................  2
Tax Return .................................................................  5
Taxes ......................................................................  5
Transaction ................................................................  1
Transfer ................................................................... 14
Transfer Notice ............................................................ 13


                                        v
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                            SHARE PURCHASE AGREEMENT

            This Share Purchase Agreement (the "Agreement") is made as of the
24th day of September 1999, by and between Khanty Mansiysk Oil Corporation, a
Delaware corporation (the "Company"), and Enterprise Oil Overseas Holdings Ltd.
(the "Purchaser"), a company organized and existing under the laws of England
and Wales and a wholly-owned subsidiary of Enterprise Oil plc ("Parent"), a
public limited company organized and existing under the laws of England and
Wales.

                                    RECITALS

            WHEREAS, the Company and Enterprise Oil Exploration Limited
("Enterprise Exploration") are parties to a Note Purchase Agreement (the "Note
Purchase Agreement"), dated as of December 17, 1998, pursuant to which KMOC, in
exchange for a US$ 5,000,000 (Five Million United States Dollars) capital
investment by Enterprise Exploration, issued to Enterprise Exploration one or
more notes (the "Notes"), convertible into fully paid and non-assessable shares
of common stock of KMOC, no par value, at a conversion price of US$ 450,000
(Four hundred Fifty United States Dollars) per share, which equates to a
conversion ratio of 2.222 shares per US $1,000 (One Thousand United States
Dollars) principal amount of the Notes all upon the terms and conditions set
forth in the Note Purchase Agreement;

            WHEREAS, in connection with its purchase of the Notes, Enterprise
Exploration and the Company entered into a Service Agreement (the "Service
Agreement"), dated as of December 17, 1998, pursuant to which Enterprise
Exploration agreed to provide the Company with certain technical and operational
support, the fees for which services ("Enterprise Costs") are convertible into
shares of common stock of the Company in certain circumstances, all as more
specifically described in the Note Purchase Agreement and the Service Agreement;

            WHEREAS, the Company wishes to sell to the Purchaser, and Purchaser
wishes to buy from the Company, 40,000 (Forty Thousand) shares of common stock,
no par value per share, of the Company, (including any additional amount of
common stock issued pursuant to Section 1.3 hereof, the "Common Stock"), for an
aggregate cash purchase price equal to US$ 20,000,000 (Twenty Million United
States Dollars), which equates to US$ 500.00 (Five Hundred) per share, all on
terms and conditions as more specifically set forth herein;

            WHEREAS, the proceeds of the purchase and sale of the Common Stock
(the "Transaction") will be used for general corporate purposes of the Company,
including, without limitation, the funding of the working capital requirements
of the Company's Russian affiliates and the Company's 1999-2000 investment
program;

            WHEREAS, in connection with the Transaction, Enterprise Exploration
and the Company are entering into an Amendment to the Note Purchase Agreement
(substantially in the form of Exhibit A hereto), dated as of the date hereof,
with respect to the conversion of the Enterprise Costs;

            NOW, THEREFORE, in consideration of the premises and of the mutual
promises, representations, warranties, covenants, conditions and agreements
contained herein, the parties hereto, intending to be legally bound by the terms
hereof, agree as follows:

                                    AGREEMENT

                                    ARTICLE I

                                PURCHASE AND SALE

            SECTION 1.1 Purchase and Sale of the Common Stock. Upon the terms
and subject to the conditions set forth in this Agreement, the Company agrees to
issue and sell to Purchaser, and the Purchaser agrees to purchase from the
Company, 40,000 (Forty Thousand) shares of common stock, no par value per share,
of the Company.

            SECTION 1.2 Consideration, Upon the terms and subject to the
conditions set forth in this Agreement, and in consideration of the sale and
delivery of one or more share certificates evidencing the Purchaser's ownership
of the Common Stock, on the Closing Date the Purchaser shall pay to the Company
cash in the amount equal to US$ 20,000,000 (Twenty Million United States
Dollars) (the "Purchase Price"), which


                                       1
<PAGE>

equates to US$500.00 (Five Hundred United States Dollars) per share (the "Share
Purchase Price"), by wire transfer of immediately available funds to a corporate
account designated by the Company.

            SECTION 1.3 Adjustment for Common Stock Issuance. Following the
Effective Date and through and including an initial public offering of the
Company's common stock, if the Company issues or sells any common stock of the
Company or any security that is convertible into or exchangeable for common
stock of the Company in an aggregate amount of at least US$5,000,000 (the
"Adjustment Transaction") for consideration that represents as of the date of
such issuance or sale a price per share of common stock that is equal to or less
than US$400 (Four Hundred United States Dollars) per share of common stock of
the Company, then upon such issuance or sale, the Purchaser shall have a
one-time, non-transferable right to have (i) the Share Purchase Price adjusted
to equal the per share price of the common stock in such issuance or sale (the
"Adjusted Share Price"), and (ii) the number of shares of Common Stock purchased
pursuant to this Agreement increased so that the Purchaser shall receive the
number of shares of common stock of the Company that the Purchaser would have
owned if it had purchased the Common Stock at the Adjusted Share Price. The
Company shall notify the Purchaser of the Adjustment Transaction if reasonably
possible, prior to the closing of such transaction, and in all events, not later
than 5 business days following the closing of such transaction.

            SECTION 1.4 Adjustment Procedure. In the event that the Purchaser
elects to exercise its adjustment right pursuant to Section 1.3 above, it shall
deliver written notice (the "Adjustment Notice") of such election to the Company
within 15 days following the receipt of notice from the Company regarding the
Adjustment Transaction and shall surrender the share certificate evidencing the
Common Stock to the principal office of the Company. Upon receipt of the
Adjustment Notice and such share certificate, the Share Purchase Price shall
automatically be adjusted accordingly in the manner set forth in Section 1.3
above. Within 15 days of its receipt of the Adjustment Notice and the share
certificate, the Company shall deliver to the Purchaser a duly executed share
certificate reflecting the adjusted additional amount of shares of common stock
issuable to the Purchaser pursuant to Section 1.3 above.

            Notwithstanding the foregoing, no adjustment shall occur pursuant to
Section 1.3 in the case of issuances or sales of common stock or securities
convertible into or exchangeable for common stock if such issuance or sale is
made pursuant to (i) agreements, obligations, arrangements or commitments
existing prior to the date hereof or (ii) employee or executive stock option
plans.

            SECTION 1.5 Closing. The consummation of the purchase and sale of
the Common Stock (the "Closing") shall occur, subject to the satisfaction or
waiver of the conditions set forth in Article IV, at the offices of the
Purchaser, Grand Buildings, Trafalgar Square, London, WC2N 5EJ, England on
September 24, 1999, at 2:00 pm, local time, or otherwise as the parties may
agree (the "Closing Date"). At the Closing, the parties shall make the
deliveries and take the other actions contemplated by Article V.

                                   ARTICLE II

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

            The Company hereby represents and warrants to the Purchaser as
follows:

            SECTION 2.1 Corporate Organization. Each of the Company and each
Subsidiary (as defined below) is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of organization. Each of
the Company and each Subsidiary has full corporate power and authority to own
its properties and assets and to carry on its business as now being conducted
and is duly qualified or licensed to do business as a foreign corporation in
good standing in the jurisdictions in which the ownership of its property or the
conduct of its business requires such qualification, all of which jurisdictions
are listed in Section 3.1 of the Disclosure Schedule attached hereto as Exhibit
D hereto (the "Disclosure Schedule"), except jurisdictions in which the failure
to be so qualified or licensed (i) would not have a material adverse effect on
the business, operations, assets, or financial condition of the Company and the
Subsidiaries, taken as a whole, or (ii) based upon information available to the
Company on the date hereof, would not reasonably be expected to have a material
adverse effect on the prospects of the Company and the Subsidiaries, taken as a
whole (other than an effect that would arise from general industry, political or
economic conditions or government policies), (hereinafter referred to as a
"Material Adverse Effect"). The Company has delivered or made available to the
Purchaser true, correct and complete copies of the Certificate of Incorporation
and Bylaws, or similar corporate governance documents, of the Company and of
each Subsidiary as presently in effect. Section 3.1 of the Disclosure Schedule
contains a true and correct list of (i) those entities in which the Company has
a 50% or greater (direct or indirect) equity interest (such entities, excluding
the Non-


                                       2
<PAGE>

active and Immaterial Russian Subsidiaries listed in such Disclosure Schedule,
the "Majority Subsidiaries") and (ii) those entities in which the Company has an
equity interest less than 50% (such entities, excluding the Non-active and
Immaterial Russian Subsidiaries listed in such Disclosure Schedule, the
"Minority Subsidiaries" and, collectively with the Majority Subsidiaries, the
"Subsidiaries"), in each case identifying the relevant jurisdictions of
incorporation (and other principal places of doing business) and, in the case of
the Minority Subsidiaries, the percentage of the Company's equity interest in
such Minority Subsidiary. Other than as disclosed in Section 3.1 of the
Disclosure Schedule, the Company does not own, directly or indirectly, any
capital stock or other equity or equity related securities of any corporation or
have any direct or indirect equity or ownership interest in any partnership,
joint venture or other business, other than those securities held by the
Company, directly or indirectly, from time to time for investment purposes.

            SECTION 2.2 Capital Stock. Section 3.2 of the Disclosure Schedule
contains a true, correct and complete description of the authorized, issued and
outstanding capital stock of the Company as of the date hereof. The record
holders (the "Stockholders") of the issued and outstanding shares of capital
stock of the Company are the persons (for the purposes of this Agreement,
"person" shall mean any individual, corporation, partnership, joint-stock
company, limited liability company, trust, unincorporated organization or
government or other agency or political subdivision thereof) listed in Section
3.2 of the Disclosure Schedule and the amount of shares of capital stock held by
each Stockholder is set forth opposite the respective Stockholder's name in
Section 3.2 of the Disclosure Schedule. To the knowledge of the Company, the
shares of capital stock listed in Section 3.2 of the Disclosure Schedule are,
and will be on the Closing Date, held by the respective Stockholder free and
clear of all options, pledges, security interests, voting trust or similar
arrangements, liens, claims, charges or other legal or equitable rights or
encumbrances or restrictions on voting or transfer (collectively, the
"Encumbrances"), except as set forth in Section 3.2 of the Disclosure Schedule,
and issued and outstanding. All of the outstanding shares of capital stock of
the Subsidiaries owned by the Company are owned by the Company, free and clear
of all Encumbrances. Except as set forth in Section 3.2 of the Disclosure
Schedule, there are no subscriptions, options, warrants, calls, rights,
contracts, commitments, understandings, restrictions or arrangements to which
the Company is a party relating to the issuance, sale, transfer or voting of any
shares of capital stock of the Company, including any rights of conversion or
exchange under any outstanding securities or other instruments ("Stock-Related
Instruments") existing as of the date hereof. The Company has made available to
the Purchaser true, correct and complete copies of all written Stock-Related
Instruments listed in Section 3.2 of the Disclosure Schedule. All outstanding
shares of capital stock of the Company, as of the date hereof and as of the
Closing Date (a) have been duly authorized, validly issued and are fully paid
and nonassessable, (b) except as set forth in Section 3.2 of the Disclosure
Schedule, are and have been free of any preemptive rights, (c) were not issued
in violation of the terms of any contract, agreement, lease, plan, instrument or
other document binding on the Company, and (d) were issued in compliance with
all applicable charter documents of the Company and all applicable federal,
state and foreign securities or "blue sky" laws, statutes, ordinances, rules and
regulations.

            SECTION 2.3 Issuance of Common Stock. Upon the consummation of the
transactions contemplated hereby and upon the receipt of all consents and
waivers set forth in Exhibit F hereto, the Common Stock issued hereunder shall
be duly authorized and validly issued, free of all Encumbrances. The issuance of
the Common Stock will not violate or contravene the terms of any contract,
agreement, note, bond, mortgage, indenture, deed of trust, license, franchise,
permit, lease, plan, instrument or other document ("Contract") binding on the
Company.

            SECTION 2.4 Authorization, Etc. The Company has full corporate power
and authority to execute and deliver this Agreement, and the share certificates
evidencing the Common Stock, the Amendment to the Note Purchase Agreement and
the Shareholder Agreement (collectively, the "Related Agreements") and to carry
out the transactions contemplated hereby and thereby. The Board of Directors of
the Company has duly approved and authorized the execution and delivery by the
Company of this Agreement and the Related Agreements and the consummation of the
transactions contemplated hereby and thereby, and no other corporate proceedings
on the part of the Company are necessary to approve and authorize the execution
and delivery by the Company of this Agreement and the Related Agreements and the
consummation by the Company of the transactions contemplated hereby and thereby.
This Agreement and the Related Agreements have been duly and validly executed on
behalf of the Company and constitute valid and binding agreements of the Company
enforceable against the Company in accordance with their respective terms,
subject to applicable bankruptcy, insolvency and other laws generally applicable
to creditors' rights and to general principles of equity and except to the
extent that the rights to indemnity and contribution contained in this Agreement
and the Shareholders Agreement may be subject to limitations on enforceability
under US federal and state securities laws.


                                       3
<PAGE>

            SECTION 2.5 Financial Statements. (a) The Company has previously
delivered to the Purchaser (a) the Company's audited consolidated balance sheets
at December 31, 1998, (b) the Company's unaudited balance sheet and statement of
profit and loss at June 30, 1999. Attached hereto as Exhibit B is a copy of the
financial statements referred to in (a) and (b) above, which together with the
related notes and schedules thereto are sometimes referred to herein as the
"Financial Statements".

            To the best knowledge of the Company, the Financial Statements (a)
fairly present in all material respects the assets, liabilities and financial
condition of the Company as of the dates thereof and the results of operations
of the Company for the respective periods ended on such dates, (b) have been
prepared from the books and records of the Company and (c) except as otherwise
set forth in the notes thereto, (i) have been prepared in accordance with United
States generally accepted accounting principles consistently applied and (ii)
include all adjustments that are necessary for a fair presentation of the
information shown.

            SECTION 2.6 No Approvals or Conflicts. The execution and delivery by
the Company of this Agreement and the Related Agreements and the consummation by
the Company of the transactions contemplated hereby and thereby will not (i)
violate, conflict with or result in a breach of any provision of the Certificate
of Incorporation or Bylaws of the Company, (ii) violate, conflict with or result
in a breach of any provision of, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default) under, or
result in the creation of any lien, security interest, charge or encumbrance
upon any of the properties of the Company or the Subsidiaries under, any
contract to which the Company or any Subsidiary is a party or by which the
Company, any Subsidiary, or any of their respective properties may be bound,
(iii) violate any order, injunction, judgement, ruling, law or regulation of any
court or governmental authority applicable to the Company, any Subsidiary or any
of their respective properties and (iv) require any order, license, consent,
approval, waiver, permit or authorization of, or notice to, or declaration,
filing or registration with, or the granting of any exemption by, or the taking
of any other action in respect of, any governmental or regulatory authority or
other person not a party to this Agreement except (a) the consents and waivers
set forth in Exhibit F hereto, and (b) the orders, filings, registrations or
other actions contemplated by the Shareholder Agreement, and except where the
occurrence of any of the events in clauses (ii), (iii) or (iv) above would not
result in a Material Adverse Effect.

            SECTION 2.7 Compliance with Law; Governmental Authorizations. To the
best knowledge of the Company, the Company and the Subsidiaries are not in
violation of any order, injunction, judgment, ruling, law or regulation of any
court or governmental authority applicable to the property or business of the
Company or the Subsidiaries which violation or violations in the aggregate would
have a Material Adverse Effect. The licenses, permits and other governmental
authorizations held by the Company and the Majority Subsidiaries are valid and
sufficient for the conduct of the Company's and the Majority Subsidiaries'
business as currently conducted, except where the failure to hold such licenses,
permits and other governmental authorizations would not have a Material Adverse
Effect.

            SECTION 2.8 Licensed Interests.

            (a) To the knowledge of the Company, the Company, the Limited
Liability Company Chernogorskoye ("Chernogorskoye") and OAO
Khantymansisykneftegazgeologia ("KMNGG"), as the case may be, each have a valid
licensed interest (either directly or through one or more of their respective
subsidiaries or affiliates) in the development of the Russian oil fields
identified in the relevant subsurface license set forth opposite its name in
Section 2.8 of the Disclosure Schedule (the "Evaluated Properties"), free and
clear of all material encumbrances except for (i) encumbrances specifically
described in Section 2.8 of the Disclosure Schedule, (ii) statutory liens not
delinquent, (iii) encumbrances that are not material in character, amount or
extent and do not materially detract from the value, or interfere with the use
of, the interest affected thereby or otherwise materially impair the business or
(iv) contracts and agreements for the sale and transportation of oil and gas
entered into in the ordinary course of business.

            (b) To the best knowledge of the Company, the Company and the
Subsidiaries have good and valid title to all the properties and assets of every
kind, character and description (real, personal or mixed, tangible and
intangible), including, without limitation, all parcels of real property,
pipelines, rights-of-way and easements and other incidental rights and permits,
but excluding the rights in respect of the Evaluated Properties set forth in
Section 2.8 (a) above, reflected on the June 30, 1999 Unaudited Balance Sheet of
the Company, (the "Assets") free and clear of all encumbrances of any nature
except for (i) the encumbrances and title defects specifically described in
Section 2.8 of the Disclosure Schedule; (ii) mortgages and encumbrances which
secure indebtedness or obligations which are properly reflected on the Financial
Statements; (iii) liens for Taxes (as defined in Section 2.10) not yet payable
or any Taxes being contested in good faith; (iv) liens arising as a matter of
law in the


                                       4
<PAGE>

ordinary course of business, provided that the obligations secured by such liens
are not delinquent or are being contested in good faith; and (v) such
imperfections of title and encumbrances, if any, as do not materially interfere
within the present use of any of the Assets subject thereto.

            SECTION 2.9 Litigation or Other Proceedings. There are no claims,
actions, proceedings (including, but not limited to, any condemnation or eminent
domain proceedings) or investigations pending against the Company or, to the
best knowledge of the Company, (i) pending against the Subsidiaries, (ii)
threatened against the Company or the Subsidiaries, or (iii) affecting the
Assets, the Evaluated Properties (except as disclosed in Section 2.8 of the
Disclosure Schedule) or the transactions contemplated by this Agreement, before
any court or governmental or regulatory authority or body which singly or in the
aggregate would have a Material Adverse Effect.

            SECTION 2.10 Taxes.

            (a) The Company and, to the best knowledge of the Company, each
Subsidiary has (i) duly filed with the appropriate Federal, state, local and
foreign taxing authorities all Tax Returns (as defined below) required to be
filed by or with respect to the Company and the Subsidiaries as of the date of
this Agreement, and such Tax Returns are true, correct and complete in all
material respects and (ii) paid or made provision for in the Financial
Statements all Taxes (as defined below) of the Company and the Subsidiaries
shown to be due on such Tax Returns. To the best knowledge of the Company, there
are no tax liens on any of the Assets other than liens for current real estate
Taxes not yet due or Taxes being contested in good faith by appropriate
proceedings. The Company has not received any written notice of deficiency,
assessment or proposed assessment from any Federal, state, local or foreign
taxing authority with respect to liabilities for Taxes of the Company or the
Subsidiaries which have not been paid or finally settled, and, to the best
knowledge of the Company, there is no pending tax examination of or tax claim
assessed against the Company, any Subsidiary or any of the Assets.

            (b) For purposes of this Agreement, "Taxes" shall mean all taxes,
charges, fees, levies, penalties or other assessments imposed by any United
States Federal, state, local or foreign taxing authority, including, but not
limited to, income, service, leasing, occupation, excise, property, sales and
use, transfer, franchise, payroll, withholding, social security or other taxes,
including any interest, penalties or additions attributable thereto.

            (c) For purposes of this Agreement, "Tax Return" shall mean any
return, report, information return or other document (including any related or
supporting information) filed or required to be filed with any taxing authority
with respect to Taxes.

            SECTION 2.11 Labor Relations. Neither the Company nor any Subsidiary
is a party to any collective bargaining agreement applicable to employees of the
Company or the Subsidiaries. The Company and the Subsidiaries are in compliance
in all material respects with all applicable laws, ordinances, regulations,
statutes, rules and restrictions relating to (a) employment, (b) hiring,
promotion, employment and pay practices, (c) terms and conditions of employment
and (d) federal and state wages and hours laws; and neither the Company nor any
Subsidiary is engaged in any unfair labor practice which has had or is
reasonably likely to have a Material Adverse Effect. No strike, slowdown,
picketing or work stoppage by any union or other group of employees against the
Company, any Subsidiary or any of their properties wherever located, and no
secondary boycott with respect to their products, lockout by them of any of
their employees or any other labor trouble or other occurrence, event or
condition of a similar character, has occurred or, to the best knowledge of the
Company, been threatened.

            SECTION 2.12 Patents, Trademarks, Trade Names, Etc. Neither the
Company nor the Subsidiaries own, license or use any patents, trademarks,
trade names and copyrights which are material to the business of the Company or
the Subsidiaries.

            SECTION 2.13 Environmental Matters.

            (a) To the best knowledge of the Company, neither the Company nor
any of the Subsidiaries has violated or received any notice alleging any past or
present violation of, any applicable Federal, state, local or foreign laws,
statutes, ordinances, rules, regulations, orders or determinations of any
governmental authority applicable to the Company or the applicable Subsidiary,
as the case may be, in its respective jurisdiction of operation which are in
effect and duly enforced relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), to the extent that any such violation, or
such violations in the aggregate, would have a Material Adverse Effect.


                                       5
<PAGE>

            (b) To the best knowledge of the Company, the Company and the
Subsidiaries have obtained and are in compliance with all governmental permits
and similar authorizations required under Environmental Laws with respect to the
ownership, leasing and operation of their properties and the conduct of the
business of the Company and the Subsidiaries as currently conducted except, in
each case, where such failure to obtain or to be in compliance would not have a
Material Adverse Effect. To the best knowledge of the Company, no Hazardous
waste, substance or material has been stored, treated or disposed of by the
Company or the Subsidiaries or by any person on any real estate owned by the
Company or the Subsidiaries, respectively, except in compliance with
Environmental Laws; and the Company and the Subsidiaries have disposed of their
hazardous waste products with respect to the operations of their businesses in
compliance with Environmental Laws except, in each case, where such failure to
be in compliance with such laws or to obtain such permits and authorizations, or
to store, treat or dispose of such waste products would not have a Material
Adverse Effect.

            SECTION 2.14 No Brokers' or Other Fees. No broker, finder or
investment banker is entitled to any fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
the Company.

            SECTION 2.15 Foreign Corrupt Practices Act. The Company has not
taken any actions which violate the Foreign Corrupt Practices Act (the "FCPA")
and is not aware of any actions taken by foreign Subsidiaries or local partners
which if taken by a U.S. company would constitute a violation of the FCPA.

            SECTION 2.16 Absence of Certain Changes or Events. Except for
events, if any, disclosed in Section 3.16 of the Disclosure Schedule, since June
30, 1999, (a) there has been no change in the financial position of the Company,
as reflected in its unaudited consolidated balance sheets, which would result in
a Material Adverse Change and (b) to the best of the Company's knowledge, there
has been no event of default on the notes issued pursuant to the Senior
Financing entitling the holders thereof to issue a notice of acceleration in
respect of such debt.

            SECTION 2.17 Reliance By The Purchaser. The Company understands and
acknowledges that the Purchaser will be relying upon the Company's
representations and warranties set forth herein in purchasing the Securities
from the Company.

            SECTION 2.18 No Public Solicitation. The offering of the Securities
to the Purchaser, to the best of the Company's knowledge, was made only through
direct, personal communication between Purchaser and a representative of the
Company and not through public solicitation or advertising.

            SECTION 2.19 KMNGG Status. KMNGG is included on the List of
Geological-Exploration Organizations and Enterprises Producing Oil and Gas
Condensate, Exhibit to the Government Decree No. 1120, dated September 19, 1996
(the "Decree"), a copy of which has been provided to the Purchaser, and to the
best of the Company's knowledge, there has been no amendment effected to the
Decree removing KMNGG from the Exhibit to the Decree.

                                   ARTICLE III

                   REPRESENTATIONS AND WARRANTIES OF PURCHASER

            The Purchaser represents and warrants to the Company as follows:

            SECTION 3.1 Information Received. The Purchaser and its
representatives have had the opportunity to ask questions of and have received
answers from representatives of the Company concerning its purchase of the
Common Stock. The Purchaser has received or has had access to all additional
information concerning the Company and the transactions contemplated hereby that
it has requested.

            SECTION 3.2 Investment and Industry Experience. The Purchaser has
such knowledge and experience in financial and business matters, including
investing in securities of new and speculative companies, as to be able to
evaluate the merits and risks of its investment in the Common Stock. In
addition, the Purchaser is an oil and gas exploration and production company
with substantial experience in evaluating oil and gas related investments.


                                       6
<PAGE>

            SECTION 3.3 Nondistributive Intent. The Purchaser is requiring the
Common Stock for its own account, for investment and with no view to the
distribution thereof.

            SECTION 3.4 Securities not Registered. The Purchaser acknowledges
that the Common Stock has not been registered under the Securities Act of 1933,
as amended (the "Securities Act") or the securities laws of any state of the
United States or any other jurisdiction and may not be offered or sold by the
Purchaser unless subsequently registered under the Securities Act (if applicable
to the transaction) and any other applicable securities laws or unless
exemptions from the registration or other requirements thereof are available for
the transaction, which exemptions shall be established to the reasonable
satisfaction of the Company, by opinion of counsel or otherwise.

            SECTION 3.5 Accredited Investor. The Purchaser represents that it is
an accredited investor within the meaning of Rule 501 of Regulation D as
promulgated under the Securities Act, as presently in effect.

            SECTION 3.6 Legend on Securities. The Purchaser acknowledges that
the share certificates representing the Common Stock will contain legends
reflecting the restrictions on transfer imposed by the U.S. securities laws and
that such restrictions will be noted on the Company's transfer records.

            SECTION 3.7 Acknowledgement of Risk. The Purchaser acknowledges that
an investment in the Common Stock involves a high degree of risk and represents
that it understands the economic risks of such investment and can bear the risk
of such investment for an indefinite period. In connection with evaluating such
risks, Purchaser has made visits to the Khanty-Mansiysk region in Russia to
review facilities and data and has hired legal counsel in connection with its
due diligence of the Company.

            SECTION 3.8 Organization; Parent. The Purchaser is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization. The Purchaser is also a wholly-owned subsidiary of Enterprise Oil
plc, a public company organized and existing under the laws of England and
Wales.

            SECTION 3.9 Authorization. The Purchaser has all requisite power and
authority to enter into this Agreement and to carry out and perform its
obligations under the terms of this Agreement. The execution, delivery and
performance of this Agreement have been duly authorized by all necessary action
of the Purchaser. This Agreement has been duly and validly executed and
delivered on behalf of the Purchaser and, assuming the due execution of this
Agreement by the Company, constitutes a valid and binding agreement of the
Purchaser enforceable against the Purchaser in accordance with its terms,
subject to applicable bankruptcy, insolvency and other laws generally applicable
to creditors' rights and to general principles of equity and except to the
extent that the rights to indemnity and contribution contained in this Agreement
and the Shareholder Agreement may be subject to limitations on enforceability
under US federal and state securities laws.

            SECTION 3.10 Brokers' Fees. The Purchaser has no liability or
obligation to pay any fees or commissions to any broker, finder, or agent with
respect to the transactions contemplated by this Agreement.

            SECTION 3.11 No Approvals or Conflicts. The execution and delivery
by Purchaser of this Agreement and the consummation by Purchaser of the
transactions contemplated hereby will not (i) violate or conflict with or result
in a breach of any provision of the organizational documents of the Purchaser,
(ii) violate or conflict with or result in a breach of any provision of, or
constitute a default (or an event which, with notice or lapse of time or both,
would constitute a default) under, or result in the creation of a lien, security
interest, charge or encumbrance upon any of the properties of the Purchaser
under, any contract to which the Purchaser is a party or by which the Purchaser
or any of its property is bound, (iii) violate any order, injunction, judgment,
ruling, law or regulation of any court or governmental authority, applicable to
Purchaser or any of its properties or (iv) require any order, license, consent,
approval, waiver, permit or authorization of, or notice to, or declaration,
filing or registration with, or the granting of any exemption by, or the taking
of any other action in respect of, any governmental or regulatory authority or
other person not a party to this Agreement, except where the occurrence of any
of the events in clauses (ii), (iii) or (iv) above would not have a material
adverse effect on Purchaser.

            SECTION 3.12 No Public Market. Purchaser understands that no public
market now exists for the Common Stock and that the Company has made no
assurances with respect to any secondary market for the Common Stock.

            SECTION 3.13 Reliance By The Company. Purchaser understands and
acknowledges that the Company will be relying upon Purchaser's representations
and warranties set forth herein in offering and selling the Common Stock to the
Purchaser.


                                       7
<PAGE>

            SECTION 3.14 No Public Solicitation. The offering of the Common
Stock to the Purchaser, to the best of the Purchaser's knowledge, was made only
through direct, personal communication between Purchaser and a representative of
the Company and not through public solicitation or advertising.

            SECTION 3.15 Availability of Funds. The Purchaser has sufficient
finances available to pay $20,000,000 (Twenty Million United States Dollars) to
the Company in exchange for the Common Stock on the Closing Date.

                                   ARTICLE IV

                              CONDITIONS TO CLOSING

            SECTION 4.1 Conditions to Obligations of Purchaser. The obligation
of the Purchaser to purchase the Common Stock at the Closing is subject to the
fulfillment (or waiver) on or prior to the Closing Date of the following
conditions:

            (a) Representations and Warranties. All of the representations and
warranties made by the Company in this Agreement shall be true and correct in
all material respects as of the date hereof and on the Closing Date as though
made on and as of the Closing Date; provided, however that no such failure of a
representation or warranty of the Company shall be deemed a failure of this
closing condition unless such failure results in, or would be reasonably likely
to result in, a Material Adverse Effect; and, provided further, that in such
event, the Company shall have 15 days to cure such failure and a new Closing
Date shall be set by the parties accordingly. In addition, the Company is
entitled to make supplemental disclosure with respect to events occurring
subsequent to the execution of this Agreement and prior to the Closing Date,
which disclosure shall be taken into account in determining whether the
representations and warranties of the Company are true and correct as of the
Closing Date for all purposes (including for purposes of Article IX and Section
10.1(c)) other than for purposes of satisfying the conditions set forth in this
Section 4.1(a).

            (b) Performance. The Company shall have performed in all material
respects all obligations to be performed or observed by it hereunder on or prior
to the Closing Date, including delivery of the agreements, certificates and
other documents required by Section 5.1.

            (c) Consents and Waivers. Any governmental and third party consents
and waivers referenced in Section 2.6 (a) hereof and identified in Exhibit F
hereto shall have been obtained.

            (d) Injunctions. On the Closing Date there shall be no injunction,
writ, preliminary restraining order or other order in effect of any nature
issued by a court or governmental agency of competent jurisdiction directing
that the transactions provided for herein not be consummated as provided herein.

            SECTION 4.2 Conditions to Obligations of Company. The Company's
obligation to sell the Common Stock to the Purchaser at the Closing is subject
to the fulfillment (or waiver) on or prior to the Closing Date of the following
conditions:

            (a) Representations and Warranties. All of the representations and
warranties made by the Purchaser in this Agreement shall be true and correct in
all material respects as of the date hereof and on the Closing Date as though
made on and as of the Closing Date (except in the case where another date is
specified in a representation and warranty contained herein, such representation
and warranty shall be true and correct as of such date).

            (b) Consents and Waivers. The Company shall have obtained and
delivered copies to the Purchaser of all consents and waivers, referenced in
Section 2.6 (a) hereof and identified in Exhibit F hereto, from the shareholders
and note and warrant holders of the Company required to effect the transaction
as contemplated by this Agreement, the Amendment to the Note Purchase Agreement
and the Shareholder Agreement.

            (c) Performance. The Purchaser shall have performed in all material
respects all obligations to be performed or observed by it hereunder on or prior
to the Closing Date, including delivery of the agreements, certificates and
other documents required by Section 5.2.


                                       8
<PAGE>

            (d) Injunctions. On the Closing Date there shall be no injunction,
writ, preliminary restraining order or other order in effect of any nature
issued by a court or governmental agency of competent jurisdiction directing
that the transactions provided for herein not be consummated as provided herein.

            SECTION 4.3 Waiver. Any condition established in this Article may be
waived by the party for whose benefit it is created.

                                    ARTICLE V

                               CLOSING DELIVERIES

            SECTION 5.1 By the Company. At or prior to the Closing, the Company
shall deliver or cause to be delivered to the Purchaser:

            (a) a share certificate evidencing the Purchaser's ownership of the
Common Stock, duly executed on behalf of the Company and dated as of the Closing
Date;

            (b) a copy of the Amendment to the Note Purchase Agreement executed
by the Company and dated as of the Closing Date, substantially in the form of
Exhibit A hereto;

            (c) a copy of the Shareholder Agreement among the Company, Brunswick
Fitzgibbons Trust Company, the Purchaser and Enterprise Exploration, dated as of
the Closing Date, in substantially the form of Exhibit C hereto (the
"Shareholder Agreement") executed by the Company;

            (d) a certificate of the chief executive officer of the Company
dated as of the Closing Date attaching a true and correct copy of the 1999/2000
Investment Program of the Company, as approved by the Board of Directors of the
Company, and to the effect that all of the conditions to the Purchaser's
obligations hereunder have been fulfilled;

            (e) such other certificates, agreements or documents as the
Purchaser may reasonably request to evidence or effect the Company's compliance
with this Agreement or the consummation of the transactions contemplated hereby,
which shall include the required consents and waivers referenced in Section 2.6
(c) hereof and set forth on Exhibit F hereto.

            SECTION 5.2 By the Purchaser. At or prior to the Closing, the
Purchaser shall deliver or cause to be delivered to the Company the following:

            (a) cash in the amount of Twenty Million United States Dollars
(US$20,000,000) by wire transfer of immediately available funds to a Corporate
account designated by the Company;

            (b) a copy of the Shareholder Agreement executed by the Purchaser
and Enterprise Exploration;

            (c) a copy of the Amendment to the Note Purchase Agreement executed
by Enterprise Exploration; and

            (d) such other certificates, agreements or documents as the Company
may reasonably request to evidence or effect the Purchaser's compliance with
this Agreement or the consummation of the transactions contemplated hereby.

                                   ARTICLE VI

                            COVENANTS OF THE PARTIES

            SECTION 6.1 Financial Information. For as long as the Common Stock
shall be outstanding and held by the Purchaser or its Permitted Transferee (as
defined in the Shareholder Agreement), the Company will furnish to the Purchaser
as soon as practicable, and in any event within 90 days, after the end of each
fiscal year of the Company, balance sheets of the Company as at the end of such
year and the prior year, and statements of


                                       9
<PAGE>

profit and loss and cash flow for such year and the prior year, prepared in
accordance with U.S. generally accepted accounting principles, audited by
independent certified public accountants of recognized standing selected by the
Company, and promptly after the Company's receipt thereof, a copy of any letter
to Company management from such accountants commenting on the Company's
accounting systems and controls in connection with that year's audit. The
Company shall also furnish to the Purchaser copies of the monthly financial
summaries prepared for the Company's Board of Directors. In the event that the
Company has received a notice of acceleration in respect of an event of default
under the notes issued pursuant to the Senior Financing (as defined in the
Shareholder Agreement), the Company shall provide a copy of such notice to the
Purchaser as soon as practicable thereafter.

            SECTION 6.2 Access to Books and Records; Cooperation. From the date
hereof and until the earlier of the Closing or the termination of this
Agreement, the Company shall afford, during normal business hours, to the
Purchaser, its officers, attorneys, accountants and other authorized
representatives reasonable access to the offices, properties, books, records,
contracts, reports, financial forecasts, documents, geological and geophysical
data and all other information relating to the Company and the Subsidiaries
(including, but not limited to, information and documentation related to the
Company's and the Subsidiaries' reserves, title to the Evaluated Properties and
Assets, production and sales of oil and gas, and compliance with Environmental
Laws) that is necessary or helpful to the Purchaser's evaluation of the Company
and the Subsidiaries, whether or not such information is generally available to
the public. The Company (a) will grant to the Purchaser and its representatives
reasonable access to personnel of the Company and the Subsidiaries at reasonable
times that do not interfere with the orderly conduct of the Company's and the
Subsidiaries' business and (b) if reasonably requested from time to time by the
Purchaser, shall cause its officers, counsel, accountants and the officers of
the Subsidiaries to furnish to the Purchaser such additional financial and
operating data and other information so requested.

            SECTION 6.3 Publicity. Neither the Purchaser nor the Company or any
Subsidiary shall make, and each of the Company, the Subsidiaries and the
Purchaser shall cause its partners, officers, employees, representatives and
agents not to make, any statement or public announcement, or make any release to
trade publications or the press, or make any statement to any competitor,
customer or any other person not a party to this Agreement with respect to the
participation of the Purchaser in the investment in the Company pursuant to this
Agreement or the evaluation thereof contemplated hereunder ("Public
Disclosures") without the prior written consent of the other party (such consent
not to be unreasonably withheld), except for disclosures to affiliates or
related companies or representatives, agents or consultants of the parties
hereto, in each case, that are aware of and agree to be bound by the obligations
of this Agreement, and except for such disclosures as may be necessary, in the
opinion of counsel to the Purchaser or the Company, to comply with the
requirements of any law, governmental order or regulation. The Company and the
Purchaser shall agree upon the form and content of all Public Disclosures.
Neither party shall make use of the other party's name in any manner whatsoever
without the prior consent of the other party, except to the extent required, in
the opinion of counsel to such party, by law, governmental order or regulation.

            SECTION 6.4 Filings and Consents. Each of the Company and the
Purchaser shall use, and shall use best efforts to cause each of their relevant
subsidiaries to use, all reasonable efforts to obtain and to cooperate in
obtaining any order, license, consent, approval, waiver, permit or authorization
of, or notice to, or declaration, filing or registration with, preparing
applications to, conducting negotiations with, and the taking of any other
action in respect of, any governmental agency or body or other person not a
party to this Agreement required in connection with the execution, delivery or
performance of this Agreement. The Company and the Purchaser will furnish, and
will use best efforts to cause each of their relevant subsidiaries to furnish,
to one another such necessary information and reasonable assistance as may be
requested in connection with obtaining any necessary consent, approval,
authorization or order.

            SECTION 6.5 Covenant to Satisfy Conditions. Each party agrees to use
all reasonable efforts to insure that the conditions set forth in Sections 4.1
and 4.2 hereof are satisfied prior to 12 noon on September 30, 1999 (the
"Cut-Off Date"), insofar as such matters are within the control of such party.

            SECTION 6.6 Withholding Taxes. Dividends or other payments made in
respect of the Common Stock shall be net of withholding tax, if any, required by
law, governmental order or regulation. The Company shall not be required to
indemnify the Purchaser or its permitted successors or assignees with respect to
any such withholding taxes, but agrees to take all reasonable measures (without
incurring additional costs) to assist the Purchaser in minimizing withholding
tax obligations which may arise in respect of such payments.

            SECTION 6.7. Company Placement. The Company shall use its best
efforts to undertake a placement of common stock of the Company (in either an
IPO or a private placement) in a minimum amount of


                                       10
<PAGE>

US$20,000,000 (Twenty Million United States Dollars) prior to May 31, 2000. The
Company shall fully consult with the Purchaser in the event that a decision is
made by the Company not to proceed with such placement or to proceed on
different terms. It is expressly understood and agreed by the parties hereto
that the Company's undertaking under this Section 6.7 and the Company's decision
to proceed with an IPO or private placement shall be subject to the receipt of
approval from the Board of Directors, in its sole discretion, based on its
assessment of market conditions, capital requirements, management resource
allocation and other related factors

                                   ARTICLE VII

                               REGISTRATION RIGHTS

            SECTION 7.1 Registration Rights. The Company and the Purchaser shall
enter into a Shareholder Agreement, substantially in the form of Exhibit C
hereto, providing the Purchaser with certain registration rights with respect
to the Common Stock.

                                  ARTICLE VIII

                            TRANSFER OF COMMON STOCK

            SECTION 8.1 Transfer Restrictions. The Common Stock shall be subject
to certain restrictions on transfer which are set forth in the Shareholders
Agreement, substantially in the form of Exhibit C hereto.

                                   ARTICLE IX

                                 INDEMNIFICATION

            SECTION 9.1 Indemnity From Third Party Claims.

            (a) The Company agrees to indemnify, defend and hold Purchaser and
its Affiliates (as defined below) harmless from and against any and all loss,
liability, damage, judgment, claim, deficiency or expense (including interest,
penalties, reasonable attorneys' fees and amounts paid in settlement) to which
Purchaser or its Affiliates may become subject insofar as such loss, liability,
damage, claim, judgment, deficiency or expense arises out of or is based upon a
suit or proceedings brought by a third party or threatened by a third party (i)
arising out of, related to or based upon any breach of any representation or
warranty of the Company contained in this Agreement or the Securities or (ii)
arising out of, related to or based upon any breach or default in the
performance by the Company of any covenant or agreement of the Company contained
in this Agreement or the Securities. For purposes of this Agreement, an
"Affiliate" of any person means any other person that directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under
common control with, such first person. For purposes of the definition of
affiliate, "Control" has the meaning specified in Rule 12b-2 under the Exchange
Act as in effect on the date of this Agreement.

            (b) The Company shall not be liable for any settlement of any such
action or proceeding effected without its written consent, but if settled with
its written consent (which consent shall not be unreasonably withheld), or if
there be a final judgment for the plaintiff in any such action or proceeding,
subject to the provisions hereof, the Company agrees to indemnify and hold
harmless the Purchaser and its Affiliates, to the extent provided in the
preceding paragraph, from and against any loss, liability, damage or expense
incurred by reason of such settlement or judgement.

            (c) Anything herein contained to the contrary notwithstanding (i)
the indemnification herein contained shall not extend to any losses, claims,
damages, liabilities and expenses incurred by the Purchaser and its Affiliates
to the extent such losses, claims, damages, liabilities and expenses arise out
of a violation by the Purchaser or its Affiliates in connection with the
transactions contemplated hereby of any of its representations, warranties or
agreements set forth in this Agreement or any Related Agreement or of any laws,
rules, regulations or orders applicable to it, (ii) neither the Purchaser nor
its Affiliates may assert any claims under this Section 9 unless and until the
cumulative total of all such claims by such indemnitee exceeds 2.5% (Two and One
Half Percent) of the original purchase price of the Common Stock and (iii) the
Company shall not be liable for any


                                       11
<PAGE>

indemnification amounts under this Section 9.1 in excess of 33.3% (Thirty Three
and One Third) of the original purchase price of the Common Stock.

            (d) Promptly after receipt by any indemnified party under this
Section 9 of notice of the commencement of any action or proceeding, such
indemnified party shall, if a claim in respect thereof is to be made against the
Company hereunder, notify in writing the Company of the commencement thereof;
but the delay or omission so to notify the Company shall not relieve it from any
liability which it may have to any indemnified party except to the extent that
the Company is actually and materially prejudiced by such delay or failure to
give notice. In case any such action or proceeding shall be brought against any
indemnified party, and it shall notify the Company of the commencement thereof,
the Company shall be entitled to participate therein and the Company shall
assume the defense thereof, including the employment of counsel reasonably
satisfactory to the indemnified party and the payment of all expenses. The
indemnified party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such indemnified party unless (a) the
Company has agreed to pay such fees and expenses or (b) the Company shall have
failed to assume the defense of such action or proceeding and to employ counsel
reasonably satisfactory to the indemnified party in any such action or
proceeding or (c) the named parties to any such action or proceeding (including
any impleaded parties) include both the indemnified party and the Company and
the indemnified party shall have been advised by counsel that there may be one
or more legal defenses available to the indemnified party which are different
from or additional to those available to the Company and supplied a copy of such
opinion to the Company (in which case, if the indemnified party notifies the
Company in writing that the indemnified party elects to employ separate counsel
at the expense of the Company, the Company shall not have the right to assume
the defense of such action or proceeding on behalf of the indemnified party).

                                    ARTICLE X

                                   TERMINATION

            SECTION 10.1 Termination. This Agreement may be terminated and
abandoned at any time prior to the Closing:

            (a) by the mutual written consent of the Company and the Purchaser;

            (b) by the Purchaser in the event the Closing has not occurred on or
before the Cut-Off Date by reason of the failure of any condition under Section
4.1 hereof, unless the failure of such consummation shall be due to the failure
of the Purchaser to comply with the agreements or covenants contained herein to
be performed by the Purchaser on or before the Cut-Off Date;

            (c) by the Company in the event the Closing has not occurred on or
before the Cut-Off Date by reason of the failure of any condition under Section
4.2 hereof, unless the failure of such consummation shall be due to the failure
of the Company to comply with the agreements or covenants contained herein to be
performed by such party on or before the Cut-Off Date; or

            (d) by either the Company or the Purchaser in the event any court or
governmental agency of competent jurisdiction shall have issued an order, decree
or ruling or taken any other action restraining, enjoining or otherwise
prohibiting the transactions contemplated hereby and such order, decree or
ruling or other action shall have become final and nonappealable.

            SECTION 10.2 Procedure and Effect of Termination. In the event of
the termination and abandonment of this Agreement by the Company or the
Purchaser pursuant to Section 10.1 hereof, written notice thereof shall
forthwith be given to the other party. If the transactions contemplated by this
Agreement are terminated as provided herein:

            (a) Each party will redeliver all documents, work paper and other
material of the other party relating to the transactions contemplated hereby,
whether so obtained before or after the execution hereof, to the party
furnishing the same;

            (b) The Purchaser shall hold in strict confidence all information
obtained from the Company or any of the Subsidiaries in connection with this
Agreement and the transactions contemplated hereunder in accordance with Article
XI; and


                                       12
<PAGE>

            (c) Except (i) with respect to the survival of the obligations set
forth in Section 13.3 or (ii) in the case of a willful breach, neither party to
this Agreement will have any liability under this Agreement to the other party
upon termination of this Agreement.

                                   ARTICLE XI

                                 CONFIDENTIALITY

            SECTION 11.1 Confidential Information All records, data, reports and
other information, including geological and geophysical information concerning
the Company and/or its Subsidiaries and their operations (whether written or
oral) acquired or obtained before or after the date hereof by the Purchaser or
its Affiliates (including directors, employees, agents, consultants or
representatives thereof, hereinafter collectively "Representatives") in
connection with this Agreement or the transactions contemplated hereby shall be
the property of the Company. The Purchaser shall consider such information as
the Company's confidential information and shall not disclose such information
to third parties without the prior written consent of the Company.

            SECTION 11.2 Exclusions. For purposes of Section 11.1, the
obligation of confidentiality shall not extend to information:

            (a) which is available to the general public (except as a result of
a breach of this obligation by Purchaser or its Representatives);

            (b) which the Purchaser is legally compelled (including, without
limitation, by oral questions, interrogatories, requests for information or
documents, subpoena, civil investigative demand or similar process) to disclose,
in which case, the Purchaser will provide the Company with prompt written notice
so that the Company may seek a protective order or other appropriate remedy
and/or waive compliance with the provisions of this Section 11.2 (b). In the
event that such protective order or other remedy is not obtained or the Company
waives compliance with the provisions of this Section 11.2 (b), the Purchaser
will furnish only the specific information it is legally required to; or

            (c) confidential data and information which must be disclosed
pursuant to any rules or requirements of any government or stock exchange having
jurisdiction over the Purchaser, or its Affiliates; provided that if the
Purchaser or its Affiliates desire to disclose information in an annual or
periodic report to its or its Affiliates' shareholders and to the public and
such disclosure is not required pursuant to any rules or requirements of any
government or stock exchange, then the Purchaser and its Affiliates shall comply
with Section 11.1.

                                   ARTICLE XII

                                PURCHASER OPTION

            SECTION 12.1 Option. Provided that the Purchaser (or its Permitted
Transferee , as defined in the Shareholder Agreement) is the owner of the Common
Stock, the Purchaser (or its Permitted Transferee) shall have a one-time option
to acquire an additional amount of common stock of the Company (the "Option
Stock") for an aggregate purchase price (the "Option Purchase Price") of US$
20,000,000 (Twenty Million United States Dollars), at a per share price equal to
either (a) the price established at an initial public offering ("IPO") of the
common stock of the Company, discounted by 25% (Twenty Five Percent) or (b) the
price or average price established at any financing or series of related
financings prior to an IPO, which financing or series of financings involves the
sale by the Company of an aggregate of more than 50% (Fifty Percent) of the
Company's common stock, or securities convertible into common stock, (on a fully
diluted basis)(a "Majority Sale"), discounted by 25% (Twenty Five Percent). For
purposes of this Agreement, the terms "fully diluted" or "on a fully diluted
basis" means, with respect to any securities, the number of such securities
outstanding assuming the exercise, exchange or conversion, as the case may be,
of all rights, options, warrants, notes or other securities exercisable or
exchangeable for or convertible into such securities, provided that, except for
stock options granted under the Company's management/employee stock option plan,
the consideration required for the exercise, exchange or conversion has been
contributed to the Company as of the date of the relevant calculation.


                                       13
<PAGE>

                  SECTION 12.2 Transaction Notice. Prior to the IPO or the
closing of a financing that results in a Majority Sale, the Company shall
deliver written notice (the "Transfer Notice") to the Purchaser specifying (i)
with respect to the IPO, the anticipated principal terms of the proposed IPO and
all other material information then available which is reasonably relevant to
such public offering and (ii) with respect to a Majority Sale, the number of
shares of common stock proposed to be sold by the Company (or the terms of
conversion for securities convertible into common stock), the percentage such
shares represent of the total number of outstanding shares of common stock of
the Company (on a fully diluted basis), the proposed purchase price, and the
name and address of the proposed purchaser.

                  SECTION 12.3 Exercise of Option.

                  (a) In the event that the Purchaser (or its Permitted
Transferee, as defined in the Shareholder Agreement) elects to exercise its
option to purchase common stock of the Company pursuant to Section 12.1 above,
which option may not be exercised in part for less than the Option Purchase
Price, the Purchaser shall deliver a binding irrevocable commitment (the
"Commitment") to purchase the Option Stock for the Option Purchase Price to the
Company within 30 days of its receipt of the Transfer Notice (the "Option
Period"). Upon the Company's receipt of such commitment and if requested by the
Company, the Purchaser shall immediately (but in no event later than 15 days
after the Option Period) execute a share subscription agreement with the Company
evidencing the Company's obligation to sell and the Purchaser's obligation to
purchase the Option Stock for the Option Purchase Price. If the Purchaser does
not deliver such commitment, in form and substance satisfactory to the Company,
(or fails to execute the share subscription agreement evidencing such
commitment) within the above specified time periods, the Purchaser shall have no
further rights under this Article XII and the Company shall be released from its
obligations to the Purchaser under this Article XII.

            (b) The Company shall be free for a period of 180 days after the
earlier of (i) the date of its receipt of the Commitment or (ii) upon expiration
of the Option Period, to sell, assign or transfer (each a "Transfer") the
Company's offered securities specified in the Transfer Notice (such amount to be
(i) increased without limitation, or (ii) decreased by an amount equal to a
maximum of 25% (Twenty Five Percent) of the aggregate proposed offering
specified in the Transfer Notice, at the Company's sole discretion without
having to further comply with the provisions of this Article XII. The Company
shall also have the right to revise the terms of the sale (including a decrease
of the purchase price by an amount equal to a maximum of 25% (Twenty Five
Percent) of the price specified in the Transfer Notice) for the proposed
offering (again, without having to further comply with the provisions of this
Article XII). If the terms or size of the offering of the Company's securities
are revised in excess of the limits set forth in this Section 12.3(b), or if the
Company does not sell the offered securities within such 180 day period, the
Purchaser shall be entitled to withdraw its Commitment, if any has been made. In
addition, the Company shall be required to issue a new transfer notice, and the
Purchaser will retain its option to purchase the Offered Shares, in respect of
any future sale of securities pursuant to Article XII.

            (c) If the Purchaser has elected to purchase the Option Stock, the
closing of the sale of the Option Stock will be held at the Company's principal
office in New York on a date to be specified by the Company in the Transfer
Notice which is not less than 10 days nor more than 60 days after the IPO or the
closing of the Majority Sale, as the case may be. At the closing and as may be
more specifically set forth in a share subscription agreement between the
parties, the Purchaser will transfer to the Company the Option Purchase Price,
payable in cash to the Company's account, and the Company will deliver the
Option Shares, free and clear of all liens, claims and encumbrances. Upon their
issuance to the Purchaser, the Option Shares shall become subject to the
Shareholders Agreement.

                                  ARTICLE XIII

                                  MISCELLANEOUS

            SECTION 13.1 Waivers and Amendments. This Agreement may be amended
only in a writing signed by both parties, and any waiver of any provision hereof
shall be effective only if set forth in a writing signed by the party charged
with the waiver. No failure to enforce any provision of this Agreement shall be
deemed to or shall constitute a waiver of such provision and no waiver of any of
the provisions of this Agreement shall be deemed to or shall constitute a waiver
of any other provision hereof (whether or not similar) nor shall such waiver
constitute a continuing waiver.

                                       14
<PAGE>

            SECTION 13.2 Governing Law. This Agreement shall be governed by the
laws of the State of New York without regard to the conflicts of laws provisions
thereof.

            SECTION 13.3 Survival. The obligations of the Company and the
Purchaser, as the case may be, under Sections 6.3, 9.1, 13.2 and 13.7 and
Article II shall survive the termination of this Agreement. The representations,
warranties, covenants and agreements made herein shall survive the Closing,
regardless of any investigation made by or on behalf of any party or its
representatives. All statements as to factual matters contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant hereto or in connection with the transactions contemplated hereby shall
be deemed to be representations and warranties by the Company hereunder as of
the date of such certificate or instrument.

            SECTION 13.4 Successors and Assigns.

            (a) Except as expressly provided in the Shareholder Agreement,
neither this Agreement nor any of the rights or obligations hereunder shall be
assigned by either of the parties hereto without the prior written consent of
the other party, except that either party may assign all its rights and
obligations to the assignee of all or substantially all of the assets of such
party including an acquisition through merger, provided that such party shall in
no event be released from its obligations hereunder without the prior written
consent of the other party.

            (b) Notwithstanding the provisions of Section 13.4 (a), all
transferees of Securities shall be subject to the restrictions on transfer set
forth in Article VIII hereof and, for so long as such transferee (excluding
Permitted Transferees) holds Securities, shall be deemed party to this Agreement
for purposes of Article VIII only.

            (c) Subject to the foregoing, this Agreement will be binding upon,
inure to the benefit of and be enforceable by the parties and their respective
successors and assigns. Any attempted assignment in contravention hereof shall
be null and void.

            SECTION 13.5 Entire Agreement. This Agreement, the Exhibits hereto,
including the Disclosure Schedule, and the Related Agreements (a) constitute the
entire agreement and supersede all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof
and (b) are not intended to confer upon any person, other than the parties
hereto, any rights or remedies hereunder.

            SECTION 13.6 Notices. All notices that are required or may be given
hereunder shall be in writing and may be given by personal delivery or by
facsimile transmission or mail. The person sending any notice shall prepay all
transmission charges. Any notice personally delivered or given by mail shall be
deemed effective upon receipt. Transmission by a recognized courier service
shall be deemed personal delivery and any notice so delivered shall be deemed
received at the time of delivery confirmed by the courier service. Any notice
sent by facsimile transmission shall be deemed received upon confirmation of
transmission by the sender's facsimile machine. The following address and fax
number may be used for delivery of notices until another address or fax number
is specified by the Company or the Purchaser in a written notice to the other:

            If to the Company:

            Khanty Mansiysk Oil Corporation
            152 West 57th Street, 29th Floor
            New York, New York 10019
            Attention:John B. Fitzgibbons
            Phone: (212) 245-5544
            Fax:(212) 245-1932

            If to the Purchaser:

            Enterprise Oil Overseas Holdings Ltd
            c/o Enterprise Oil Plc
            Grand Buildings
            Trafalgar Square
            London, WC2N 5EJ
            England

            Attention:Director of Corporate Development
            Phone: (44-171) 925-4000 / Fax: (44-171) 925-4321

                                       15
<PAGE>

            SECTION 13.7 Attorneys' Fees. Inn the event of any litigation
between the parties with respect to this Agreement, the prevailing party shall
be entitled to recover, in addition to any other relief awarded by the court,
its reasonable attorneys' fees and other costs of preparing for and
participating in the litigation.

            SECTION 13.8 Severability. If any provision of this Agreement shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not be affected or impaired thereby.

            SECTION 13.9 Captions. The captions of the sections and subsections
of this Agreement and the Disclosure Schedule are for convenience of reference
only, and are not to be considered in construing this Agreement and the
Disclosure Schedule.

            SECTION 13.10 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, no one of which need be
signed by both parties, and both of which together shall constitute one
instrument.

            SECTION 13.11 Knowledge. As used herein, the term "Knowledge of the
Company" and "Best Knowledge of the Company" shall mean the actual knowledge of
the Chief Executive Officer and General Counsel or with respect to the matters
addressed in Sections 2.5, 2.10 and 2.16 (a) hereof, the Financial Director of
the Company.

            IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.

                                 KHANTY MANSIYSK OIL CORPORATION

                                 By: /s/ John B. Fitzgibbons
                                     -------------------------------------------
                                     Name: John B. Fitzgibbons
                                     Title: Chief Executive Officer


                                 ENTERPRISE OIL OVERSEAS HOLDINGS LTD, a wholly-
                                 owned subsidiary of Enterprise Oil Plc

                                 By: /s/ K.P. Watts
                                     -------------------------------------------
                                     Name: K.P. Watts
                                     Title: Corporate Development Director


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