EXHIBIT 10.11

                            MONTEREY RESOURCES, INC.
                           DEFERRED COMPENSATION PLAN

                             I.   NAME AND PURPOSE

                 The name of this plan is the Monterey Resources, Inc. Deferred
Compensation Plan (the "Plan").  The purpose of the Plan is to provide certain
highly compensated employees of Monterey Resources, Inc. (the "Company") and
its Subsidiaries and the members of the Board of Directors of the Company with
the opportunity to defer compensation earned as an Eligible Employee or as a
director on an elective basis and, to also provide Highly Paid Employees the
opportunity to receive a Company matching contribution with respect to their
base compensation in excess of that which is covered under the Company's
Savings Plan.

                              II.   EFFECTIVE DATE

                 The Plan shall become effective as of the date the Company is
spunoff by Santa Fe Energy Resources, Inc. (the "Spinoff Date").

                               III.   DEFINITIONS

                 When used in this Plan, the following terms shall have the
meanings set forth below unless a different meaning is plainly required by the
context:

                 A.       "Account" shall mean a Deferral Account, Excess
Account and/or Company Account, as the context requires.

                 B.       "Board of Directors" shall mean the Board of 
Directors of the Company.

                 C.       "Code" shall mean the Internal Revenue Code of 1986, 
as amended.

                 D.       "Committee" shall mean the Employee Benefits 
Committee of the Company.

                 E.       "Company Account" shall mean a bookkeeping account
established by the Company to credit Company Matching Contributions on behalf
of a Highly Paid Employee pursuant to Section VI(C).

                 F.       "Company Matching Contribution" shall mean an amount
equal to the product of (i) a Highly Paid Employee's Excess Contributions for
the year and (ii) the Company's actual regular matching contribution rate for
such year under the Savings Plan plus, if the Participant is entitled to
receive an Employer Bonus Contribution under the Savings Plan, the Bonus
Percentage thereunder.
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                 G.       "Compensation" shall mean (1) all directors'
retainers and fees paid by the Company to a member of the Board of Directors
and (2) the rate of annual base salary payable to an Eligible Employee by the
Company or a Subsidiary.

                 H.       "Deferral Account" shall mean a bookkeeping account
established by the Company to credit elective deferrals on behalf of a
Participant pursuant to Section VI(A).

                 I.       "Eligible Employee" shall mean an employee of the
Company or a Subsidiary whose Compensation on a specified Entry Date exceeds
ten times the amount specified in Section 402(g)(1) of the Code as in effect on
such Entry Date; such term shall also include an employee who is a Highly Paid
Employee.

                 J.       "Entry Date" shall mean the first day of each
calendar year; however, with respect to a director, the first day of the month
following his initial election as a member of the Board of Directors shall also
be an Entry Date and, with respect to a Highly Paid Employee for purposes of
making Excess Contributions, the Plan's effective date shall also be an Entry
Date.

                 K.       "Excess Account" shall mean a bookkeeping account
established by the Company to credit Excess Contributions on behalf of a Highly
Paid Employee pursuant to Section VI(B).

                 L.       "Excess Compensation" shall mean Compensation, after
reduction for any elective deferrals under this Plan that are credited to a
Participant's Deferral Account, in excess of the amount specified in Section
401(a)(17) of the Code as in effect on such Entry Date.  In no event shall
compensation that is covered by the Savings Plan be Excess Compensation under
this Plan.

                 M.       "Excess Contributions" shall mean the amount of
Excess Compensation deferred by a Highly Paid Employee for a year pursuant to
Section V.

                 N.       "Highly Paid Employee" shall mean an Eligible
Employee who has Excess Compensation.

                 O.       "Participant" shall mean a member of the Board of
Directors, an Eligible Employee or Highly Paid Employee who makes an election
to participate in the Plan.

                 P.       "Payment Date" shall mean the date elected by a
Participant on which to receive distribution of his Account(s) established with
respect to a specified year.

                 Q.       "Savings Plan" shall mean the Monterey Resources,
Inc. Savings Investment Plan.

                 R.       "Subsidiary" shall mean any corporation in which the
Company owns directly or indirectly at least 50% of the voting stock.

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                 Throughout this Plan, words in the masculine gender shall
include the feminine and neuter genders, the plural shall include the singular
and the singular shall include the plural.

                               IV.   PARTICIPANTS

                 Each member of the Board of Directors and each Eligible
Employee, including each Highly Paid Employee, shall be eligible to participate
in the Plan.  A Highly Paid Employee shall be eligible to make an election with
respect to his Compensation or his Excess Compensation or both.  In the event
that an employee makes an election to participate in the Plan for a particular
year believing such employee is an Eligible Employee (or Highly Paid Employee,
as the case may be), and it is subsequently determined that such employee's
Compensation at the Entry Date does not exceed ten times the amount specified
in Section 402(g)(1) (or, with respect to a Highly Paid Employee, Section
401(a)(17)) of the Code as adjusted for that year, any amounts deferred by such
employee under the Plan (or, if applicable, Excess Contributions made) for such
year shall be returned to the employee as soon as practicable and no further
deferrals (or Excess Contributions, as the case may be) shall be made for such
employee with respect to such year.

                       V.   MANNER OF ELECTING DEFERRALS

                 An Eligible Employee, who has made an election under the
Savings Plan to contribute the maximum amount permitted under Section 402(g)(1)
of the Code for that year, may elect to defer all or a part of his or her
Compensation for a specified year by giving written notice to the Company
setting forth the Participant's election as to:

                 (a)      the percentage (in multiples of 5% of Compensation,
         up to 100% thereof) of the Participant's Compensation to be deferred
         for such year; and

                 (b)      the Payment Date, as described in Section VII(A), for
         distribution of that year's Deferral Account.  In addition, a Highly
         Paid Employee, who has made an election under the Savings Plan to
         contribute the maximum amount permitted under Section 402(g)(1) of the
         Code for that year, may elect, either in lieu of or in addition to an
         election made with respect to his Compensation, to defer part of his
         Excess Compensation for such year (an "Excess Contribution") by giving
         written notice to the Company setting forth the Participant's election
         as to:

                          (x)     the percentage (either 1%, 2%, 3% or 4%) of
                 the Participant's Excess Compensation to be deferred for such
                 year; and

                          (y)     the Payment Date, as described in Section
                 VII(A), for distribution of that year's Matching Account and
                 Excess Account.

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                 If, however, during a year a Highly Paid Employee reduces his
election under the Savings Plan to less than the maximum amount permitted by
Section 402(g)(1) of the Code, the Participant shall automatically cease making
Excess Contributions hereunder.

                 In order to participate in the Plan for a specified year, a
Participant must deliver an executed deferred compensation election to the
Company, on the form prescribed by the Company for that purpose, prior to the
Entry Date for such year.

                 The elections described in this Section shall pertain only to
the year for which they are made and shall apply to all Compensation and/or
Excess Compensation, if applicable, payable for such year.  If no election is
made for a year, no elective deferral of Compensation or Excess Compensation
will be made for such year.  All elections shall be irrevocable except to the
extent the Committee, in its sole discretion, permits a Participant to
terminate or change a deferral election.  Such termination or change shall be
effective only with respect to Compensation or Excess Compensation earned after
the date such termination or change of election is approved by the Committee.

                                 VI.   ACCOUNTS

                 A.       Deferral Accounts.  A separate Deferral Account shall
be established and maintained for each Eligible Employee who elects to be a
Participant for a year reflecting the amount of Compensation electively
deferred for that year by the Participant and the interest credited thereon as
provided in D. below.  In the event two or more Deferral Accounts of a
Participant are to be paid on the same Payment Date, all such Deferral Accounts
shall be aggregated into a single Deferral Account for such Participant.  At
the end of each month, an amount shall be credited to the appropriate Deferral
Account of each Participant to reflect the Compensation otherwise payable
during said month but deferred pursuant to the Plan by the Participant.

                 B.       Excess Accounts.  A separate Excess Account shall be
established and maintained for each Highly Paid Employee who elects to be a
Participant for a year reflecting the amount of Excess Compensation electively
deferred for that year by the Participant and the interest credited thereon as
provided in D. below.  In the event two or more Excess Accounts of a
Participant are to be paid on the same Payment Date, all such Excess Accounts
shall be aggregated into a single Excess Account for such Participant.  At the
end of each month, an amount shall be credited to the appropriate Excess
Account of each Participant to reflect the Excess Compensation otherwise
payable during said month but deferred pursuant to the Plan by the Participant.

                 C.       Company Accounts.  A separate Company Account shall
be established and maintained each year for each Highly Paid Employee who makes
an Excess Contribution such year reflecting the amount of Company Matching
Contributions credited on his behalf that year, if any, and the interest
credited thereon as provided in D. below.  In the event two or more Company
Accounts of a Participant are to be paid on the same Payment Date, all such
Company Accounts shall be aggregated into a single Company Account for such
Participant.  At the end of each month,

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an amount shall be credited to the appropriate Company Account of each
Participant who is a Highly Paid Employee to reflect the Company Matching
Contribution, if any, credited for said month on behalf of the Participant.

                 D.       Interest.  Each Account shall be credited with
interest as of the last day of each month based upon the balance in such
Account on such date after first reducing the Account balance to reflect any
distributions made during such month from such Account and before crediting to
the Account any new deferrals made or Company Matching Contributions credited,
as the case may be, for such month.  Interest for each month shall be computed
by using the interest rate earned for such month by the Fixed Interest Fund (or
the equivalent thereof) of the Savings Plan.

                 E.       Vesting.  A Participant shall at all times be 100%
vested (possess a nonforfeitable interest) in his Participant and Excess
Accounts and shall be vested in his Company Accounts, if any, on any date to
the same extent that he is vested in his Employers Contributions Account under
the Savings Plan on such date.

                        VII.   DISTRIBUTION OF ACCOUNTS

                 A.       Elected Distribution Date.  Except as provided below,
a Participant's Accounts shall be valued as of the end of the month coinciding
with or immediately preceding the Payment Date elected by the Participant with
respect to such Account and shall be paid in a single, lump-sum distribution
(by Company check) to the Participant as soon as is reasonably practicable
after such Payment Date.

                 Each year a Participant elects to defer Compensation and/or
Excess Compensation, the Participant shall elect (at the time of the deferral
and prior to the Entry Date) from among the following alternatives (to the
extent applicable) the Payment Date applicable with respect to his deferrals
for such year:

         Option 1:        January 1 of any specified year, but not later than
         the January 1 on or next following (i) with respect to an Eligible
         Employee, the later of the Participant's (a) 70th birthday or (b)
         termination of his employment with the Company and its Subsidiaries
         ("Retirement") or (ii) the Participant's ceasing to be a director, as
         the case may be;

         Option 2:        If an Eligible Employee, as soon as practicable after
         the Participant's Retirement; or

         Option 3:        If an Eligible Employee, January 1 after the year in
         which the Participant's Retirement occurs.

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                 B.       Distributions Upon Death or Disability of
Participant.  If a Participant dies or becomes disabled (i.e., is receiving
benefits under the Company's long-term disability plan or Social Security), the
Participant's Accounts shall be valued as of the end of the month in which the
Participant dies or becomes disabled, as the case may be, and shall be paid to
the Participant's estate, in the event of death, or to the Participant, in the
event of his disability, as the case may be, in a single lump-sum (by Company
check) as soon as is reasonably practicable after such date of death or
disability.

                 C.       Early Termination of Employment.  If a Participant
terminates employment (for reasons other than death or Disability) with the
Company and its Subsidiaries prior to attaining his early retirement date under
the Pension Plan, then notwithstanding his election of a later Payment Date to
the contrary, his Accounts shall be valued as of the end of the month
coinciding with or immediately preceding the date of such termination of
employment and, to the extent vested, shall be paid to the Participant in a
single lump-sum (by Company check) as soon as is reasonably practicable
thereafter.  Any nonvested Company Account balances shall be immediately
forfeited on his termination of employment.

                 D.       Hardship Distributions.  In the event of an
unforeseen and immediate financial emergency of a Participant which is beyond
his control, the Committee may, in its sole discretion, upon a written request
of a Participant, direct the acceleration of such vested portion of the
Participant's Accounts as may be necessary to meet such emergency.  The
Committee shall require the Participant to furnish the Committee with proof of
such emergency and the Participant's other financial resources as the Committee
may deem necessary to evaluate a Participant's written request for accelerated
payment.

                          VIII.   PARTICIPANTS' RIGHTS

                 Establishment of the Plan shall not be construed to give any
Eligible Employee the right to be retained in the service of the Company or a
Subsidiary.  A Participant shall not have any interest in the amounts credited
to his Accounts until such Accounts are distributed in accordance with the
Plan.  With respect to amounts deferred or otherwise held in an Account for a
Participant, the Participant shall be an unsecured general creditor of the
Company.

                 IX.   NON-ALIENABILITY AND NON-TRANSFERABILITY

                 No Participant may borrow against his Accounts; no Account
shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution or levy of any
kind, whether voluntary or involuntary.  However, if a former spouse of a
Participant is awarded an interest in a Participant's Accounts through a
judgment or order of a court, the Committee may, in its sole discretion, direct
that the payment of such interest awarded to the former spouse be paid (valued
as of the end of the month that the Company received written notice of such
award) to the former spouse in a lump sum; thereafter, the Participant's
Accounts shall be reduced for all Plan purposes by the amount of any such
payment.

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                         X.   STATEMENTS OF ACCOUNT

                 Statements will be sent to Participants as soon as practicable
after the end of each year as to the balance in their Accounts as of the end of
such year.

                              XI.   ADMINISTRATION

                 The Committee shall have the authority to adopt rules and
regulations for carrying out the Plan and to interpret, construe and implement
the provisions thereof.  Any decision or interpretation of any provision of the
Plan adopted by the Committee shall be final and conclusive.  The individuals
serving as the Committee shall be fully indemnified (to the extent permitted by
law) by the Company for all claims, losses, damages or expenses incurred by
them for any act, omission or construction made in connection with the Plan.
The Committee is expressly authorized to direct at any time that the Accounts
of a Participant that are fully vested and payable at the same Payment Date be
aggregated for recordkeeping purposes.

                        XII.   AMENDMENT AND TERMINATION

                 The Plan may, at any time, be amended, modified or terminated
by the Board of Directors.  In addition, the Committee may amend or modify the
Plan provided that no such amendment or modification made by the Committee can
materially increase the obligations of the Company under the Plan.  Any such
amendment, modification or termination requires the affirmative approval of a
majority of the members constituting a quorum and shall be evidenced by a
written resolution or other document signed by the Board of Directors or the
Committee, as the case may be.  No amendment, modification or termination of
the Plan shall, without the consent of a Participant, adversely affect such
Participant's rights with respect to amounts accrued in his Accounts.
Notwithstanding anything in the Plan to the contrary, all Accounts shall become
immediately payable in full upon the termination of the Plan.

                      XIII.   UNFUNDED STATUS OF THE PLAN

                 Except as provided below, any and all payments made to the
Participant pursuant to the Plan shall be made only from the general assets of
the Company.  All Accounts under the Plan shall be for bookkeeping purposes
only and shall not represent a claim against specific assets of the Company.
Nothing contained in this Plan shall be deemed to create a trust of any kind or
create any fiduciary relationship between the Company and the Participant.  The
Company, in its sole discretion, may establish a grantor trust to provide for
all or part of such Accounts, provided that the assets of such grantor trust at
all times remain subject to the claims of the general creditors of the Company.

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                     XIV.   SFER PLAN TRANSFERRED ACCOUNTS

                 Effective with the corporate spinoff of the Company by Santa
Fe Energy Resources, Inc. ("SFER") the deferred accounts of any Eligible
Employee under a similar SFER deferred compensation plan were transferred from
such SFER plan to this Plan and such transferred accounts shall continue to be
held hereunder pursuant to the elections made by the Participants under the
SFER plan and shall be invested as provided in this Plan and paid pursuant to
the Participant's distribution election(s) made under the SFER plan.  Further,
any deferral election made under such SFER plan with respect to compensation
otherwise to be earned by the Eligible Employee after the date of the corporate
spinoff shall be deemed to be a continuing election, without interruption or
change, under this Plan for the remainder of the year in which such corporate
spinoff occurs.

                            XV.   GENERAL PROVISIONS

                 A.       Notices.  All notices to the Company hereunder shall
be delivered to the attention of the Secretary of the Company.  Any notice or
filing required or permitted to be given to the Committee or the Company under
this Plan shall be sufficient if in writing and hand delivered, or sent by
registered or certified mail, to the Company or the Committee, as appropriate,
at the principal office of the Company.  Such notice shall be deemed given as
of the date of delivery or, if delivery is made by mail, as of the date shown
on the postmark or the receipt for registration or certification.

                 B.       Controlling Law.  Except to the extent superseded by
applicable federal law, the laws of the State Delaware shall be controlling in
all matters relating to the Plan.

                 C.       Captions.  The captions of Sections and paragraphs of
this Plan are for convenience only and shall not control or affect the meaning
or construction of any of its provisions.

                 D.       Action by the Company.  Any action required or
permitted by the Company under the Plan shall be by resolution of its Board of
Directors or any person or persons authorized by its Board of Directors with
respect to such matters.

                 E.       Facility of Payment.  Any amounts payable hereunder
to any person under legal disability or who, in the judgment of the Committee,
is unable to properly manage his financial affairs may be paid to the legal
representative of such person or may be applied for the benefit of such person
in any manner which the Committee may select.

                 F.       Withholding of Taxes.  The Company shall withhold
from such Compensation and Excess Compensation when deferred, or from deferred
compensation payments when made hereunder, as the case may be, any taxes
required to be withheld therefrom for federal, state or local government
purposes.

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                 G.       Severability.  Whenever possible, each provision of
the Plan shall be interpreted in such manner as to be effective and valid under
applicable law (including the Code), but if any provision of the Plan shall be
held to be prohibited by or invalid under applicable law, then (i) such
provision shall be deemed amended to, and to have contained from the outset
such language as shall be necessary to, accomplish the objectives of the
provision and (ii) all other provisions of the Plan shall remain in full force
and effect.

                 H.       No Strict Construction.  No rule of strict
construction shall be applied against the Company, the Committee, the Board of
Directors, or any other person in the interpretation of any of the terms of the
Plan or any rule or procedure established by the Committee.

                 I.       Successors.  The provisions of the Plan shall bind
and inure to the benefit of the Company and its successors and assigns.  The
term "successors" as used herein shall include any corporation or other
business entity which shall by merger, consolidation, purchase or otherwise,
acquire all or substantially all of the business and assets of the Company and
successors of any such corporation or other business entity.

                 IN WITNESS WHEREOF, Monterey Resources, Inc. has caused this
amendment to be executed by its duly authorized officer this 13th day of
November, 1996, effective for all purposes as of the Spinoff Date.

                                        MONTEREY RESOURCES, INC.

                                        By: /s/ R. GRAHAM WHALING
                                        Title: Chief Executive Officer

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