PLAN OF MERGER

         This Plan of Merger is made and entered into this 5th day of May, 2000,
by  and  between  TIDELANDS  OIL  &  GAS  CORPORATION,   a  Nevada  corporation,
("TIDELANDS" or the "Surviving corporation"),  and OMNI ACQUISITION CORPORATION,
a Nevada corporation, ("OMNI" or the "Disappearing Corporation").

                                    RECITALS

         A. TIDELANDS is a corporation  organized and existing under the laws of
the State of Nevada and has authorized  capital stock  consisting of 100,000,000
shares of common stock, par value $0.001 per share, of which  17,640,489  shares
are issued and outstanding.

         B. OMNI is a corporation in organization under the laws of the State of
Nevada and has authorized  capital stock  consisting of 25,000,000  shares,  par
value $0.001 per share,  of which  5,000,000  shares are issued and  outstanding
being owned by Tidelands.


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         C. The Board of Directors of TIDELANDS and OMNI, respectively,  deem it
advisable for OMNI to merge with and into TIDELANDS.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained  herein,  TIDELANDS  and OMNI hereby  agree to the  following  Plan of
Merger:

         1.  Names of  Constituent  Corporations.  OMNI will merge with and into
TIDELANDS. TIDELANDS will be the Surviving Corporation.

         2. Terms and Conditions of Merger. The effective date of merger will be
the date upon which the  Articles of Merger are filed with the Nevada  Secretary
of State. Upon the effective date of the merger the separate corporate existence
of OMNI will cease;  title to all real estate and other  property  owned by OMNI
will be vested in TIDELANDS without  reversion or impairment;  and the Surviving
Corporation  will have all  liabilities of OMNI.  Any  proceeding  pending by or
against OMNI may be continued as if such merger did not occur,  or the Surviving
Corporation may be substituted in the proceeding for OMNI.

         3.  Governing  Law.  The laws of the State of Nevada  will  govern  the
Surviving Corporation.

         4. Name. The name of the Surviving  Corporation will be TIDELANDS OIL &
GAS CORPORATION.

         5. Registered  Office.  The present address of the registered office of
the Surviving and Disappearing corporation's is P.O. Box 270234, Corpus Christi,
Texas 78247.

         6.  Accounting.  The  assets  and  liabilities  of  TIDELANDS  and OMNI
(collectively  the "Constituent  Corporations")  as of the effective date of the
merger will be taken up on the books of the Surviving Corporation at the amounts
at  which  they  are  carried  at  that  time  on the  respective  books  of the
Constituent Corporations.

         7.  Bylaws.  The Bylaws of TIDELANDS  as of the  effective  date of the
merger will be the Bylaws of the  Surviving  Corporation  until the same will be
altered or amended in accordance with the provisions thereof.

         8.  Directors.  The directors of TIDELANDS as of the effective  date of
the merger  will be the  directors  of the  Surviving  Corporation  until  their
respective successors are duly elected and qualified.

         9. Manner and Basis of Converting  Shares.  As of the effective date of
the merger:


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                  (a) The Surviving Corporation will retire or cancel all of the
         shares of OMNI and any shares of stock of OMNI in the  treasury  on the
         effective  date of the  merger  will be  surrendered  to the  Surviving
         Corporation   for   cancellation,   and  no  shares  of  the  Surviving
         Corporation will be issued in respect thereof.

         10. Shareholder Approval.  This Plan of Merger will be submitted to the
sole  shareholder of OMNI for its approval in the manner  provided by law. After
approval, the Articles of Merger will be filed as required under the laws of the
State of Nevada.

         11. Rights of Dissenting Shareholders.  Tidelands, the sole shareholder
of Omni will waive any dissenting rights.

         12.  Termination  of Merger.  This merger may be  abandoned at any time
prior to the filing of Articles of Merger with the  Secretary  of State,  upon a
vote of a majority of the Board of Directors of both  TIDELANDS and OMNI. If the
merger  is  terminated,  there  will  be no  liability  on the  part  of  either
Constituent Corporation, their respective Boards of Directors, or shareholders.

         13. Counterparts.  This Plan of Merger may be executed in any number of
counterparts,  and all such  counterparts  and copies will be and  constitute an
original instrument.

         IN  WITNESS  WHEREOF,  this  Plan of  Merger  has been  adopted  by the
undersigned corporations as of this 5th day of May, 2000.

TIDELANDS OIL & GAS CORPORATION             OMNI ACQUISITION CORPORATION


By: /s/ Michael Ward                        By:   /s/ Michael Ward
   --------------------------                  -------------------
Name:   Michael Ward                        Name:     Michael Ward
Title:  President                           Title:    President