FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT

     THIS FIRST AMENDMENT TO REVOLVING  CREDIT  AGREEMENT,  dated as of February
29, 2000 (the "Amendment"),  is by and among OCEAN ENERGY, INC. (the "Company"),
a corporation duly organized and validly existing under the laws of the State of
Texas,  each of the  banks  which is or which  may  from  time to time  become a
signatory hereto (individually,  a "Bank" and, collectively,  the "Banks"), BANK
OF  AMERICA,  N.A.,  successor  to Bank of America  National  Trust and  Savings
Association,  as Syndication  Agent,  BANK ONE,  TEXAS,  N.A., as  Documentation
Agent,  SOCIETE  GENERALE,  SOUTHWEST  AGENCY and BANK OF MONTREAL,  as Managing
Agents,  THE CHASE MANHATTAN BANK, as Auction  Administrative  Agent,  and CHASE
BANK OF TEXAS, NATIONAL ASSOCIATION, as Administrative Agent,

                               W I T N E S S E T H

     WHEREAS  the  Company,  the Banks and the Agents  are  parties to a certain
Revolving Credit Agreement, dated as of March 30, 1999 (the "Credit Agreement");
and

     WHEREAS the Company and the Banks desire to amend certain provisions of the
Credit Agreement;

     NOW, THEREFORE, the parties hereto hereby agree as follows:

1.   DEFINITIONS.  Unless  otherwise  defined  herein or the  context  otherwise
     requires,  or except as the  definition  may be amended by this  Amendment,
     terms used in this  Amendment,  including its preamble and recitals,  shall
     have the meanings provided in the Credit Agreement, as hereby amended.

2.   AMENDMENTS TO CREDIT AGREEMENT.

(a)  The  definition  of  "Indebtedness"  appearing in Section 1.1 of the Credit
     Agreement is amended hereby by replacing the phrase "as to any Person" with
     "as to any Person, without duplication".

(b)  The last  paragraph of the  definition  of "Interest  Period"  appearing in
     Section 1.1 of the Credit  Agreement  is amended  hereby in its entirety to
     the following:

<PAGE>



                                                                   8

     "  Notwithstanding  the  foregoing:  (i) each  Interest  Period which would
otherwise  end on a day  which  is not a  Business  Day  shall  end on the  next
succeeding  Business Day (or, in the case of an Interest  Period for  Eurodollar
Loans,  if such  next  succeeding  Business  Day  falls in the  next  succeeding
calendar  month,  on the next preceding  Business Day);  (ii) no Interest Period
applicable to any Eurodollar  Loan or any  Competitive  Loan shall extend beyond
the end of the scheduled  Revolving  Credit  Availability  Period,  and (iii) no
Interest Period for any Eurodollar  Loans shall have a duration of less than one
month and, if the Interest  Period therefor would otherwise be a shorter period,
such Loans shall not be available hereunder."

(c)  The definition of  "Organizational  Documents"  appearing in Section 1.1 of
     the Credit  Agreement  is amended  hereby by deleting the phrase "as of the
     date of the Loan Document referring to such Organizational Document".

(d)  Section 1.1 of the Credit  Agreement  is amended  hereby by  inserting  the
     following definition of "Register" in appropriate alphabetical order:

     " "Register" shall have the meaning set forth in Section 13.5(d)."

(e)  The definition of "Subordinated  Indebtedness"  appearing in Section 1.1 of
     the Credit Agreement is amended hereby in its entirety to the following:

"    "Subordinated  Indebtedness"  shall mean all unsecured  Indebtedness of the
     Company which is subordinated in right of payment to the payment in full of
     all Obligations."

(f)  The  definition  of  "Tangible  Net Worth"  appearing in Section 1.1 of the
     Credit  Agreement  is amended  hereby by  replacing  the  phrase  "less any
     Redemption Obligations" with "and any Redemption Obligations".

(g)  The  definitions of "APC",  "ENSTAR  Alaska",  and "Senior  Leverage Ratio"
     appearing  in Section  1.1 of the  Credit  Agreement  are  deleted in their
     entirety.

(h)  Subsection 3.2(a) of the Credit Agreement is amended hereby by deleting the
     second sentence thereto in its entirety.

(i)  The first sentence of Section 5.3 of the Credit Agreement is amended hereby
     by replacing  the phrase "for which  payable" with "for which such interest
     is payable".

(j)  Section 6.2 of the Credit  Agreement  is amended  hereby by  replacing  the
     phrase "to make Eurodollar  Loans" with "to make Eurodollar  Loans with the
     applicable Interest Period".

(k)  Section 6.3 of the Credit  Agreement  is amended  hereby by  replacing  the
     phrase  "(in  which case the  provisions  of  Section  6.4 hereof  shall be
     applicable)"  with "(in which case the  provisions  of Sections 6.4 and 6.8
     hereof shall be applicable)".

(l)  Subsection 6.8(c) of the Credit Agreement is amended hereby by deleting the
     phrase  "if  Administrative  Agent  and  each  of  the  other  Banks  shall
     consent,".



<PAGE>

(m)  Section 8.1 of the Credit  Agreement  is amended  hereby in its entirety to
     the following:

    "8.1 Corporate Existence.  The Company, the Guarantor and each Subsidiary of
     the Company are duly organized, legally existing and in good standing under
     the laws of the respective  jurisdictions in which they are formed, and are
     duly  qualified  in all  jurisdictions  wherein the  property  owned or the
     business  transacted  by them makes such  qualification  necessary  and the
     failure to so qualify could  reasonably be expected to result in a Material
     Adverse Effect."

(n)  Section 8.6(a) of the Credit  Agreement is amended hereby by replacing each
     use of the phrase "present  fairly" with "present  fairly,  in all material
     respects".

(o)  Section 8.18 of the Credit Agreement is amended hereby by deleting the last
     four sentences thereof in their entirety.

(p)  Section  8.22 of the Credit  Agreement is amended  hereby by replacing  the
     phrase "will be completed by September  30, 1999" with "has been  completed
     in all material respects".

(q)  Subsection  9.1(a) of the Credit  Agreement is amended  hereby by replacing
     the  phrase  "fairly  present"  with  "fairly  present,   in  all  material
     respects".

(r)  Subsection  9.2(a)(ii)  of the Credit  Agreement  is amended  hereby in its
     entirety to the following:

     " (ii) [Intentionally omitted]."

(s)  Section 9.7 of the Credit  Agreement  is amended  hereby by  replacing  the
     phrase "or  charges  levied by any  governmental  or revenue  authority  in
     respect of any of the Loan  Documents  or any other  document  referred  to
     therein, all costs, expenses, taxes, assessments and other charges incurred
     in connection with any filing, registration, recording or perfection of any
     lien" with "or charges levied by any  Governmental  Authority in respect of
     any of the Loan  Documents or any other document  referred to therein,  all
     costs,  expenses,   taxes,   assessments  and  other  charges  incurred  in
     connection  with any filing,  registration,  recording or perfection of any
     Lien".

(t)  Subsection  9.10(vi)  of the  Credit  Agreement  is  amended  hereby in its
     entirety to the following:

    "(vi)  any  material  change  in the  accuracy  of the  representations  and
     warranties of the Company or any Subsidiary  contained in this Agreement or
     any other Loan Document; or".



<PAGE>

(u)  Subsection  9.10(viii)  of the Credit  Agreement  is amended  hereby in its
     entirety to the following:

    "(viii) any tariff and rate cases and other  material  reports  filed by the
     Company or any of its Subsidiaries with any Governmental  Authority and any
     notice to the  Company  or any of its  Subsidiaries  from any  Governmental
     Authority  concerning  noncompliance  with any  applicable  material  Legal
     Requirement; or ".

(v)  Subsection  10.1(i)(d)(ii)  of the Credit  Agreement  is amended  hereby by
     deleting  the  phrase  "not  exceeding,   in  the  aggregate  at  any  time
     outstanding, $50,000,000".

(w)  Subsection  10.1(i)(h)  of the Credit  Agreement  is amended  hereby in its
     entirety to the following:

    "(h)  obligations  of any  Restricted  Subsidiary  under oil or gas purchase
     contracts for oil or gas not taken, as to which such Restricted  Subsidiary
     is liable to pay if not made up;".

(x)  Subsection  10.2(a)  of the  Credit  Agreement  is  amended  hereby  in its
     entirety to the following:

"(a) Liens securing (i) the Loans or other obligations under the Loan Documents,
     and (ii) the  obligations  under any debt  facility  permitted  pursuant to
     Section 10.1(iii)  of this Agreement  which by its terms requires that such
     debt facility be secured on a ratable basis with other Senior Debt upon the
     incurrence  of Liens  generally,  provided  that such Liens (A) are for the
     equal and  ratable  benefit of the Agents and the Banks  under each of this
     Agreement and such debt facilities and (B) cover the same collateral,".

(y)  Subsection  10.2(g) of the Credit  Agreement is amended hereby by replacing
     "$25,000,000" with "$50,000,000".

(z)  Subsection  10.2(k)  of the  Credit  Agreement  is  amended  hereby  in its
     entirety to the following:

     "(k) [Intentionally omitted];".

     (aa) Section  10.2(n) of the  Credit  Agreement  is  amended  hereby in its
          entirety to the following:



<PAGE>

    "(n) any Lien existing on any real or personal property of any Person at the
     time it becomes a Restricted  Subsidiary,  or existing prior to the time of
     acquisition upon any real or personal  property  acquired by the Company or
     any of its Restricted Subsidiaries."

     (bb) Sections 10.7 and 10.8 of the Credit  Agreement are amended  hereby in
          their entirety to the following:

         "10.7  Total  Leverage  Ratio.  The  Company  will not permit its Total
          Leverage Ratio to be at any time more than 3.75 to 1.00.

          10.8 [Intentionally omitted]."

     (cc) Sections 12.1 and 12.6 of the Credit  Agreement are amended  hereby by
          replacing each reference to "affiliates" with "Affiliates".

     (dd) The first sentence of Section 12.6 of the Credit  Agreement is amended
          hereby by replacing  each  reference to the phrase "the  Company" with
          "the Company and its Subsidiaries".

     (ee) The fourth sentence of Subsection  13.5(a) of the Credit  Agreement is
          amended  hereby  by  replacing  the  phrase  "any  provision  of  this
          Agreement"  with "any  provision  of this  Agreement or any other Loan
          Document".

     (ff) Subsection 13.5(b)(ii)(B) of the Credit Agreement is amended hereby by
          replacing the word "consent" with "consents".

     (gg) Subsection  13.5(c)(ii)  of the Credit  Agreement is amended hereby by
          replacing each reference to the phrase "the Company" with "the Company
          and its Subsidiaries".

     (hh) Subsection  13.5(c)(iii) of the Credit  Agreement is amended hereby by
          replacing the phrase "Section 8.6" with "Sections 8.6 and 9.1".

          (ii) The second sentence of Subsection 13.5(d) of the Credit Agreement
               is amended hereby by replacing the word "person" with "Person".

     (jj) The fourth sentence of Section 13.6 of the Credit Agreement is amended
          hereby by replacing  the phrase "any right or privilege  to" with "any
          right or privilege to contract for, charge".

     (kk) The last  sentence of Section 13.6 of the Credit  Agreement is amended
          hereby by inserting "or to any Loan,  nor shall this  Agreement or any
          Loan be governed by or be subject to the  provisions  of such  Chapter
          346 in any manner whatsoever" prior to the period at the end thereof.



<PAGE>

     (ll) Section 13.7 of the Credit  Agreement  is amended  hereby by replacing
          the phrase "Section 13.6" with "Sections 13.6 and 13.14".

     (mm) Subsection  13.14(a)  of the Credit  Agreement  is  amended  hereby by
          replacing  the phrase  "written  information  about the Company"  with
          "written information about the Company or any of its Subsidiaries".

     (nn) Subsection  13.14(b)(vi)(1)  of the Credit Agreement is amended hereby
          by replacing the phrase "the  enforcement of the  Obligations to" with
          "the enforcement of the Obligations by".

     (oo) Exhibit D of the Credit  Agreement is hereby  replaced in its entirety
          by Exhibit D to this Amendment.

3.   REPRESENTATIONS AND WARRANTIES.

     In order to induce the Banks and the  Agents to enter into this  Amendment,
the Company hereby reaffirms,  as of the date hereof,  its  representations  and
warranties  contained in Section 8 of the Credit Agreement (except to the extent
any such  representation  and warranty  relates  solely to an earlier  date) and
additionally represents and warrants as follows:

     3.1  Organization.  The Company,  the Guarantor and each  Subsidiary of the
Company are duly organized, legally existing and in good standing under the laws
of the  respective  jurisdictions  in  which  they are  organized,  and are duly
qualified  in all  jurisdictions  wherein  the  property  owned or the  business
transacted  by them makes such  qualification  necessary  and the  failure to so
qualify could reasonably be expected to result in a Material Adverse Effect.

     3.2 Corporate Power and  Authorization.  The Company is duly authorized and
empowered to execute,  deliver,  and perform this  Amendment;  and all corporate
action on the Company's part for the due execution, delivery, and performance of
this Amendment has been duly and effectively taken.

     3.3 No Legal Bar or  Resultant  Lien.  The  Company's  creation,  issuance,
execution,  delivery  and  performance  of this  Amendment  do not and  will not
violate any  provisions  of the  Organizational  Documents of the Company or any
Legal  Requirement to which the Company,  the Guarantor or any Subsidiary of the
Company  is  subject  or by  which  its  property  may  be  presently  bound  or
encumbered,  or  result  in the  creation  or  imposition  of any Lien  upon any
properties of the Company, the Guarantor or any Subsidiary of the Company, other
than those permitted by this Agreement.



<PAGE>

     3.4 Binding  Obligations.  This Amendment and the Credit  Agreement and the
other Loan  Documents  constitute  legal,  valid and binding  obligations of the
Company and its  Subsidiaries  and the Guarantor,  to the extent each is a party
thereto, enforceable against the Company and its Subsidiaries and the Guarantor,
to the extent  each is a party  thereto,  in  accordance  with their  respective
terms,  except as may be limited by any  bankruptcy,  insolvency,  moratorium or
other similar laws or judicial decisions  affecting  creditors' rights generally
and general principles of equity whether considered at law or in equity.

4. EFFECT OF AMENDMENT.

     This Amendment shall be deemed to be an amendment to the Credit  Agreement,
and the Credit Agreement,  as amended hereby,  is hereby ratified,  approved and
confirmed in each and every respect.  All references to the Credit  Agreement in
any other document,  instrument,  agreement or writing shall hereafter be deemed
to refer to the Credit Agreement as amended hereby.

5. GOVERNING LAW, SEVERABILITY, ETC.

     THIS  AMENDMENT  SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH THE
APPLICABLE  LAWS (OTHER  THAN THE  CONFLICT OF LAWS RULES) OF THE STATE OF TEXAS
AND THE UNITED STATES OF AMERICA FROM TIME TO TIME IN EFFECT. Whenever possible,
each  provision of this  Amendment  shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Amendment
shall be prohibited by or invalid under  applicable law, such provision shall be
ineffective  to  the  extent  of  such   prohibition   or  invalidity,   without
invalidating the remainder of such provision or the remaining provisions of this
Amendment.

     THIS  WRITTEN  AMENDMENT  AND  THE  CREDIT  AGREEMENT  AS  AMENDED  BY THIS
AMENDMENT  REPRESENT  THE FINAL  AGREEMENT  BETWEEN  THE  PARTIES AND MAY NOT BE
CONTRADICTED  BY  EVIDENCE  OF  PRIOR,   CONTEMPORANEOUS,   OR  SUBSEQUENT  ORAL
AGREEMENTS OF THE PARTIES.

    THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

6. MISCELLANEOUS.

6.1 Successors and Assigns. This Amendment shall be binding upon and shall inure
to the  benefit  of the  parties  hereto  and their  respective  successors  and
assigns.

6.2  Counterparts.  This Amendment may be executed in one or more  counterparts,
each of which  shall be  deemed  an  original  but all of which  together  shall
constitute one and the same instrument.



<PAGE>

6.3  Effectiveness.  This Amendment shall become effective when (i) counterparts
hereof  executed  on behalf of the  Company  and the  Majority  Banks (or notice
thereof  satisfactory  to the Agent) shall have been received by the Agent,  and
(ii) notice  thereof  shall have been given by the Agent to the Company and each
Bank.


<PAGE>



                                     S - 22

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Amendment to be
executed by their  respective  officers  thereunto duly authorized as of the day
and year first written above.

                      OCEAN ENERGY, INC., a Texas corporation


                   By:
                 Name: Stephen A. Thorington
                Title: Senior Vice President, Finance, Treasury and Corporate
                       Development


<PAGE>

                 CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, as a Bank and as
                       Administrative Agent


              By:
            Name:
           Title:



<PAGE>

                  THE CHASE MANHATTAN BANK, as Auction Administrative Agent


              By:
            Name:
           Title:



<PAGE>

        BANK OF AMERICA, N.A., successor to Bank of America National Trust and
            Savings  Association, as a Bank and as Syndication Agent


           By:
         Name:
        Title:




      BANK ONE, TEXAS, N.A., as a Bank and as Documentation Agent


          By:
        Name:
       Title:


       SOCIETE GENERALE, SOUTHWEST AGENCY, as a Bank and as a Managing Agent


        By:
       Name:
      Title:



<PAGE>

       BANK OF MONTREAL, as a Bank and as a Managing Agent


    By:
  Name:
 Title:




<PAGE>

             BANKBOSTON, N.A., as a Bank and as Co-Agent


    By:
  Name:
 Title:



<PAGE>

        ABN AMRO BANK N.V., HOUSTON AGENCY, as a Bank and as Co-Agent


    By:
  Name:
 Title:

    By:
  Name:
 Title:



<PAGE>

      CREDIT SUISSE FIRST BOSTON, as a Bank and as Co-Agent


      By:
      Name:
      Title:

      By:
      Name:
      Title:


<PAGE>

       WELLS FARGO BANK (TEXAS), NATIONAL ASSOCIATION, as a Bank


       By:
       Name:
       Title:


<PAGE>

       CREDIT LYONNAIS, NEW YORK BRANCH, as a Bank


       By:
       Name:
       Title:



<PAGE>

       THE BANK OF NOVA SCOTIA, as a Bank and as Co-Agent


       By:
       Name:
       Title:



<PAGE>

       SOUTHWEST BANK OF TEXAS, N.A., as a Bank


       By:
       Name:
       Title:



<PAGE>

       THE BANK OF TOKYO-MITSUBISHI, LTD., as a Bank


       By:
       Name:
       Title:



<PAGE>

       THE BANK OF NEW YORK, as a Bank and as Co-Agent


       By:
       Name:
       Title:




       MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as a Bank and as Co-Agent


       By:
       Name:
       Title:





       THE FUJI BANK LIMITED, NEW YORK BRANCH, as a Bank


       By:
       Name:
       Title:



<PAGE>

       THE SANWA BANK, LIMITED, as a Bank


       By:
       Name:
       Title:


       BANKERS TRUST COMPANY, as a Bank


       By:
       Name:
       Title:


       U.S. BANK, NATIONAL ASSOCIATION, as a Bank


       By:
       Name:
       Title:


       UNION BANK OF CALIFORNIA, N.A., as a Bank


       By:
       Name:
       Title:




<PAGE>




                               Exhibit D - Page 3

                                    Exhibit D

                                     Form of

                             Compliance Certificate

     The undersigned,  the  ___________________  of OCEAN ENERGY,  INC., a Texas
corporation (the  "Company"),  hereby certifies that he is authorized to execute
this  certificate  on behalf of the Company,  pursuant to the  Revolving  Credit
Agreement (the "Credit  Agreement") dated as of March 30, 1999, by and among the
Company, BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,  as Syndication
Agent for the Banks,  BANK ONE,  TEXAS,  N.A.,  as  Documentation  Agent for the
Banks,  SOCIETE  GENERALE,  SOUTHWEST  AGENCY and BANK OF MONTREAL,  as Managing
Agents for the Banks, THE CHASE MANHATTAN BANK, as Auction  Administrative Agent
for the Banks, and CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,  as Administrative
Agent for the Banks  ("Administrative  Agent"),  and the Banks therein named, as
amended;  and that a review of the  Company and its  Subsidiaries  has been made
under his  supervision  with a view to  determining  whether the Company and its
Subsidiaries have fulfilled all of their respective obligations under the Credit
Agreement and the other Loan Documents (as defined in the Credit Agreement); and
on behalf of the Company further certifies,  represents and warrants that to his
knowledge,  after due inquiry (each capitalized term used herein having the same
meaning given to it in the Credit Agreement unless otherwise specified):

As of                                  , ______:

     (a) The  Company  and its  Subsidiaries  have  fulfilled  their  respective
obligations  under the Credit  Agreement  and the other Loan  Documents  as each
applies after giving effect to any amendments,  consents and/or waivers that may
be in effect from time to time.

     (b) Except for the facts heretofore  disclosed to the Administrative  Agent
under the Credit  Agreement in writing,  which facts (I) are not materially more
adverse to the Company and its  Subsidiaries  or any other Obligor,  (II) do not
materially  decrease the ability of any Agent or any of the Banks to collect the
Obligations as and when due and payable and (III) do not materially increase the
liability  of the Agents or any of the  Banks,  in each case  compared  to those
facts  existing on the date hereof and the  material  details of which have been
set forth in the  Financial  Statements  delivered to the  Administrative  Agent
under  the  Credit  Agreement  prior to the  date  hereof  or in the  Disclosure
Statements   provided  for  in  the  Credit   Agreement,   and  except  for  the
representations  set forth in the Loan  Documents  which,  by their  terms,  are
expressly  (or by means of similar  phrasing)  made as of the date of the Credit
Agreement,  only, the  representations and warranties made in each Loan Document
are true and correct in all material  respects on and as of the time of delivery
hereof,  with  the same  force  and  effect  as if made on and as of the time of
delivery hereof.


<PAGE>

     (c) The Financial  Statements  delivered to the Administrative  Agent under
the Credit  Agreement  concurrently  with this Compliance  Certificate have been
prepared in accordance  with GAAP  consistently  followed  throughout the period
indicated  and  fairly  present,  in all  material  respects,  the  consolidated
financial  condition and results of operations of the  applicable  Persons as at
the end of, and for,  the period  indicated  (subject,  in the case of quarterly
Financial Statements, to normal changes resulting from year-end adjustments).

     (d) No  Default  has  occurred  and  is  continuing.  In  this  regard  the
compliance with the provisions of Sections 10.7 and 10.9 of the Credit Agreement
is as follows:

     (i) Section 10.7 of the Credit Agreement - Total Leverage Ratio

         Total Debt            (1)    $__________

         EBITDAX               (2)    $__________

         Total Leverage Ratio (1)/(2)   ________

         Note: Must be no greater than 3.75 to 1.00.

(iii)    Section 10.9 of the Credit Agreement - Minimum Consolidated Net Worth

         Preferred stock (if any), par value of common stock, capital
         in excess of par value of common stock and retained earnings
         of Company and its Restricted Subsidiaries
                                              (1)  $__________

          Less treasury stock (if any),  goodwill,  cost in excess of fair value
     of net assets acquired and all other assets that are properly classified as
     intangible   assets  of  Company  and  its  Restricted   Subsidiaries   (2)
     $__________

         Plus any expenses associated with the Merger occurring prior to
         December 31, 1999 and not in excess of $30,000,000 in the
         aggregate, and the amount of noncash write downs of long-lived
         assets in compliance with GAAP or SEC guidelines
                             (3)  $__________

         Plus or minus, as appropriate, any extraordinary or non-recurring net
         gains or losses together with any related provision for taxes on
         such gain or loss, realized in connection with any extraordinary
         or nonrecurring gains or losses
                             (4)  $__________

         Plus or minus, as appropriate, foreign currency translation
         adjustments applicable to Company and its Restricted Subsidiaries
                             (5)  $__________


<PAGE>

                  Consolidated Net Worth [(1) - (2) + (3) +/- (4) +/- (5)]
                                 $__________

         Consolidated Net Worth Requirement Initial Amount
                              (i) $770,000,000

         Plus 50% of the sum of Company's and its Restricted Subsidiaries
         consolidated net income for each fiscal quarter beginning with the
         calendar quarter ending March 31, 1999
                                       (ii) $__________

         Plus 50% of the net cash proceeds received by the Company and
         its Restricted Subsidiaries from the issuance of any common stock,
         preferred stock or other equity for each fiscal quarter beginning
         with the calendar quarter ending March 31, 1999.
                       (iii) $__________

                  Total CNW Requirement [(i) + (ii) + (iii)]
                             $__________

          Note:  Consolidated  Net Worth  must be equal to or  greater  than the
     Total CNW Requirement

     (f) There has  occurred no Material  Adverse  Effect  since the date of the
most recent Financial Statements delivered to the Banks.

     (g) The following Letters of Credit are issued and currently outstanding:

                  Issuer:
                  Beneficiary:
                  L/C No.:
                  Amount:
                  Date of Issue:
                  Expiration:

DATED as of ____________________, ____.

                           OCEAN ENERGY, INC.


                           By:
                           Name:
                           Title: