<PAGE>
 
                                                                    EXHIBIT 4.14

                               GUARANTY AGREEMENT


                           Dated as of March 18, 1997


                                       by

                          United Meridian Corporation

                                  in favor of

                           The Chase Manhattan Bank,
                            as Administrative Agent,

                   Morgan Guaranty Trust Company of New York,
                             as Syndication Agent,

                           NationsBank of Texas, N.A.
                                      and
                               Societe Generale,
                            as Documentation Agents,


                                Banque Paribas,
                            Wells Fargo Bank, N.A.,
                                      and
                            Colorado National Bank,
                                 as Co-Agents,

                                      and

         The Lenders Now or Hereafter Signatory To The Credit Agreement
<PAGE>
 
                               TABLE OF CONTENTS
                               -----------------
<TABLE> 
<CAPTION> 
                                                                            Page
                                                                            ----
<S>                                                                         <C> 
                                  Article I 
                      Definitions and Accounting Matters

     Section 1.01  Terms Defined Above....................................   1
     Section 1.02  Certain Definitions....................................   1
     Section 1.03  Credit Agreement Definitions...........................   2

                                  Article II 
                                 The Guaranty

     Section 2.01  Obligations Guaranteed.................................   2
     Section 2.02  Nature of Guaranty.....................................   2
     Section 2.03  Lenders' Rights........................................   2
     Section 2.04  Guarantor's Waivers....................................   3
     Section 2.05  Maturity of Obligations; Payment.......................   3
     Section 2.06  Lenders' Expenses......................................   3
     Section 2.07  Obligation.............................................   3
     Section 2.08  Events and Circumstances Not Reducing or Discharging 
                    the Guarantor's Obligations...........................   3
     Section 2.09  Subrogation............................................   5

                                 Article III 
                        Representations and Warranties
     Section 3.01  By the Guarantor.......................................   5

                                  Article IV 
                         Subordination of Indebtedness

     Section 4.01  Subordination of All Guarantor Claims..................   6
     Section 4.02  Claims in Bankruptcy...................................   6
     Section 4.03  Payments Held in Trust.................................   6
     Section 4.04  Liens Subordinate......................................   7
     Section 4.05  Notation of Records....................................   7

                                  Article V 
                                 Miscellaneous

     Section 5.01  Successors and Assigns.................................   7
     Section 5.02  Notices................................................   7
     Section 5.03  Authority of Administrative Agent......................   7
     Section 5.04  CONSTRUCTION...........................................   8
     Section 5.05  Prior Guaranty.........................................   8
     Section 5.06  Survival of Obligations................................   8
     Section 5.07  Subject to the Intercreditor Agreement.................   8
</TABLE>

                                       i
<PAGE>
 
                               GUARANTY AGREEMENT
                               ------------------

          This Guaranty Agreement dated as of March 18, 1997 is by United
Meridian Corporation, a corporation duly organized and validly existing under
the laws of the state of Delaware ("Guarantor"), in favor of each of the
following: each of the financial institutions that is now or hereafter a
signatory to the Credit Agreement (as defined below) (individually, a "Lender"
and, collectively, the "Lenders"); The Chase Manhattan Bank, as administrative
agent for the Lenders (in such capacity, the "Administrative Agent"), Morgan
Guaranty Trust Company of New York, as syndication agent for the Lenders (in
such capacity, the "Syndication Agent"), NationsBank of Texas, N.A. and Societe
Generale, as documentation agents for the Lenders (in such capacity, the
"Documentation Agents"), and Banque Paribas, Wells Fargo Bank, N.A., and
Colorado National Bank, as co-agents for the Lenders (in such capacity, the "Co-
Agents").

                                    Recitals

     A.   The Guarantor and UMC Petroleum Corporation, a corporation duly
organized and validly existing under the laws of the state of Delaware (the
"Company"), the Administrative Agent, the Syndication Agent, the Documentation
Agents, the Co-Agents (collectively the "Agents") and the Lenders have executed
that certain Credit Agreement of even date herewith (such credit agreement, as
amended, the "Credit Agreement").

     B.   One of the terms and conditions stated in the Credit Agreement for the
making of the loans and extensions of credit described in the Credit Agreement
is the execution and delivery to the Agents and the Lenders of this Guaranty
Agreement.

     C.   NOW, THEREFORE, (i) in order to comply with the terms and conditions
of the Credit Agreement, (ii) to induce the Lenders, at any time or from time to
time, to loan monies, with or without security to or for the account of the
Company in accordance with the terms of the Credit Agreement, and (iii) for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Guarantor hereby agrees as follows:

                                   ARTICLE I
                       DEFINITIONS AND ACCOUNTING MATTERS

      SECTION 1.01  TERMS DEFINED ABOVE.  As used in this Guaranty Agreement,
the terms "Administrative Agent", "Agents", "Co-Agents", "Company", "Credit
Agreement", "Documentation Agents", "Guarantor", "Lender", "Lenders" and
"Syndication Agent" shall have the meanings indicated above.

     SECTION 1.02  CERTAIN DEFINITIONS.  As used in this Guaranty Agreement, the
following terms shall have the following meanings, unless the context otherwise
requires:

     "Guarantor Claims" shall have the meaning indicated in Section 4.01.

     "Guaranty Agreement" shall mean this Guaranty Agreement, as the same may
from time to time be amended or supplemented.

                                      -1-
<PAGE>
 
     "Obligations" shall mean (a) the payment and performance of all present and
future indebtedness, obligations and liabilities of the Company and/or the
Guarantor to the Agents and the Lenders under the Credit Agreement, including
but not limited to, (i) the full and punctual payment of the Notes issued
thereunder, and any and all promissory notes given in substitution for such
Notes or in modification, renewal, extension or rearrangement thereof in whole
or in part, and (ii) the reimbursement and other obligations of the Company
under and with respect to Letters of Credit and Letter of Credit Agreements now
outstanding or hereafter issued under the Credit Agreement; (b) all obligations
of the Guarantor under this Guaranty Agreement; and (c) all interest (whether
pre- or post petition), charges, expenses, reasonable attorneys' or other fees
and any other sums payable to or incurred by the Agents and the Lenders in
connection with the execution, administration or enforcement of any of their
rights and remedies hereunder or any other Security Instrument.

     SECTION 1.03  CREDIT AGREEMENT DEFINITIONS.  Unless otherwise defined
herein, all terms beginning with a capital letter which are defined in the
Credit Agreement shall have the same meanings herein as therein.

                                   ARTICLE II
                                  THE GUARANTY

     SECTION 2.01  OBLIGATIONS GUARANTEED.  The Guarantor hereby irrevocably and
unconditionally guarantees the prompt payment at maturity of the Obligations.

     SECTION 2.02  NATURE OF GUARANTY.  This guaranty is an absolute,
irrevocable, completed and continuing guaranty of payment and not a guaranty of
collection, and no notice of the Obligations or any extension of credit already
or hereafter contracted by or extended to the Company need be given to the
Guarantor. The guaranty evidenced hereby is joint and several with all other
guarantees of the Obligations. This guaranty may not be revoked by the Guarantor
and shall continue to be effective with respect to debt under the Obligations
arising or created after any attempted revocation by the Guarantor and shall
remain in full force and effect until the Obligations are paid in full and the
Aggregate Commit ments are terminated, notwithstanding that from time to time
prior thereto no Obligations may be outstanding. The Company, the Agents and the
Lenders may modify, alter, rearrange, extend for any period and/or renew from
time to time, the Obligations and the Agents and the Lenders may waive any
Default or Events of Default without notice to the Guarantor and in such event
the Guarantor will remain fully bound hereunder on the Obligations. Subject to
the terms of the Credit Agreement, this Guaranty Agreement may be enforced by
the Agents and/or the Lenders and any subsequent holder of the Obligations and
shall not be discharged by the assignment or negotiation of all or part of the
Obligations. The Guarantor hereby expressly waives presentment, demand, notice
of non-payment, protest and notice of protest and dishonor, notice of Event of
Default, notice of intent to accelerate the maturity and notice of acceleration
of the maturity and any other notice in connection with the Obligations, and
also notice of acceptance of this Guaranty Agreement, acceptance on the part of
the Agents and the Lenders being conclusively presumed by their request for this
Guaranty Agreement and delivery of the same to the Administrative Agent.

     SECTION 2.03  LENDERS' RIGHTS.  Subject to the terms of the Credit
Agreement, the Guarantor authorizes the Lenders (or the Administrative Agent on
behalf of the Lenders), without notice or demand and without affecting the
Guarantor's obligation hereunder, to take and hold security for the payment

                                      -2-
<PAGE>
 
of the Obligations, and exchange, enforce, waive and release any such security;
and to apply such security and direct the order or manner of sale thereof as the
Agents and the Lenders in their discretion may determine; and to obtain a
guaranty of the Obligations from any one or more Persons and at any time or
times to enforce, waive, rearrange, modify, limit or release any of such other
Persons from their obligations under such guaranties.

     SECTION 2.04  GUARANTOR'S WAIVERS.  The Guarantor waives any right to
require the Agents and the Lenders to (a) proceed against the Company or any
other Person liable on the Obligations, (b) enforce their rights against any
other guarantor of the Obligations, (c) proceed or enforce their rights against
or exhaust any security given to secure the Obligations, (d) have the Company
joined with the Guarantor in any suit arising out of this Guaranty Agreement
and/or the Obligations, or (e) pursue any other remedy whatsoever.  Neither the
Agents nor the Lenders shall be required to mitigate damages or take any action
to reduce, collect or enforce the Obligations.  The Guarantor waives any defense
arising by reason of any disability, lack of corporate authority or power, or
other defense of the Company or any other guarantor of the Obligations, and
shall remain liable hereon regardless of whether the Company or any other
guarantor be found not liable thereon for any reason.

     SECTION 2.05  MATURITY OF OBLIGATIONS; PAYMENT.  The Guarantor agrees that
if the maturity of the Obligations is accelerated by bankruptcy or otherwise,
such maturity shall also be deemed accelerated for the purpose of this Guaranty
Agreement without demand or notice to the Guarantor.  The Guarantor will,
forthwith upon notice from the Administrative Agent of the Company's failure to
pay the Obligations at maturity, pay to the Administrative Agent for the benefit
of the Agents and the Lenders at the Administrative Agent's Principal Office,
the amount due and unpaid by the Company and guaranteed hereby.  The failure of
the Administrative Agent to give this notice shall not in any way release the
Guarantor hereunder.

     SECTION 2.06  LENDERS' EXPENSES.  If the Guarantor fails to pay the
Obligations after notice from the Administrative Agent of the Company's failure
to pay any Obligations at maturity (whether by acceleration or otherwise), and
if the Agents or the Lenders obtain the services of an attorney for collection
of amounts owing by the Guarantor hereunder, or obtaining advice of counsel in
respect of any of their rights under this Guaranty Agreement, or if suit is
filed to enforce this Guaranty Agreement, or if proceedings are had in any
bankruptcy, receivership or other judicial proceedings for the establishment or
collection of any amount owing by the Guarantor hereunder, or if any amount
owing by the Guarantor hereunder is collected through such proceedings, the
Guarantor agrees to pay to the Administrative Agent at its Principal Office the
reasonable attorneys' fees of the Agents and the Lenders.

     SECTION 2.07  OBLIGATION.  It is expressly agreed that the obligation of
the Guarantor for the payment of the Obligations guaranteed hereby shall be
primary and not secondary.

     SECTION 2.08  EVENTS AND CIRCUMSTANCES NOT REDUCING OR DISCHARGING THE
GUARANTOR'S OBLIGATIONS.  The Guarantor hereby consents and agrees to each of
the following to the fullest extent permitted by law, agrees that its
obligations under this Guaranty Agreement shall not be released, diminished,
impaired, reduced or adversely affected by any of the following, and waives any
rights (including without limitation rights to notice) which it might otherwise
have as a result of or in connection with any of the following:

                                      -3-
<PAGE>
 
     (a) Modifications, etc.  Any renewal, extension, modification, or increase
in the amount of the Aggregate Commitments as in effect on the Effective Date,
decrease, alteration or rearrangement of all or any part of the Obligations, any
Security Instrument or any instrument executed in connection therewith, or any
contract or understanding between the Company, any Agent and/or  the Lenders, or
any other Person, pertaining to the Obligations;

     (b) Adjustment, etc.  Any adjustment, indulgence, forbearance or compromise
that might be granted or given by the Agents or the Lenders to the Company or
the Guarantor or any Person liable on the Obligations;

     (c) Condition of the Company or the Guarantor.  The insolvency, bankruptcy
arrangement, reorganization, adjustment, composition, liquidation, disability,
dissolution or lack of power of the Company or the Guarantor or any other Person
at any time liable for the payment of all or part of the Obligations; or any
sale, lease or transfer of any or all of the assets of the Company or the
Guarantor, or any changes in the shareholders of the Company or the Guarantor;

     (d) Invalidity of Obligations.  The invalidity, illegality or
unenforceability of all or any part of the Obligations or any Security
Instrument, including the Notes, for any reason whatsoever, including without
limitation the fact that the Obligations, or any part thereof, exceed the amount
permitted by law, the act of creating the Obligations or any part thereof is
ultra vires, the officers or representatives executing any Security Instrument
or otherwise creating the Obligations acted in excess of their authority, the
Obligations violate applicable usury laws, the Company has valid defenses,
claims or offsets (whether at law, in equity or by agreement) which render the
Obligations wholly or partially uncollectible from the Company, the creation,
performance or repayment of the Obligations (or the execution, delivery and
performance of any Security Instrument) is illegal, uncollectible, legally
impossible or unenforceable, or the Credit Agreement, the Notes or other
Security Instruments have been forged or otherwise are irregular or not genuine
or authentic;

     (e) Release of Obligors.  Any full or partial release of the obligation of
the Company on the Obligations or any part thereof, of any co-guarantors, or any
other Person now or hereafter liable, whether directly or indirectly, jointly,
severally, or jointly and severally, to pay, perform, guarantee or assure the
payment of the Obligations or any part thereof, it being recognized,
acknowledged and agreed by the Guarantor that the Guarantor may be required to
pay the Obligations in full without assistance or support of any other Person,
and the Guarantor has not been induced to enter into this Guaranty Agreement on
the basis of a contemplation, belief, understanding or agreement that other
parties other than the Company will be liable to perform the Obligations, or
that the Agents and the Lenders will look to other parties to perform the
Obligations;

     (f) Other Security.  The taking or accepting of any other security,
collateral or guaranty, or other assurance of payment, for all or any part of
the Obligations;

     (g) Release of Collateral, etc.  Any release, surrender, exchange,
subordination, deterioration, waste, loss or impairment (including without
limitation negligent, willful, unreasonable or unjustifiable impairment) of any
collateral, Property or security, at any time existing in connection with, or
assuring or securing payment of, all or any part of the Obligations;

                                      -4-
<PAGE>
 
     (h) Care and Diligence.  The failure of any Agent or any Lender or any
other Person to exercise diligence or reasonable care in the preservation,
protection, enforcement, sale or other handling or treatment of all or any part
of such collateral, Property or security;

     (i) Status of Liens.  The fact that any collateral, security or Lien
contemplated or intended to be given, created or granted as security for the
repayment of the Obligations shall not be properly perfected or created, or
shall prove to be unenforceable or subordinate to any other Lien, it being
recognized and agreed by the Guarantor that the Guarantor is not entering into
this Guaranty Agreement in reliance on, or in contemplation of the benefits of,
the validity, enforceability, collectability or value of any of the collateral
for the Obligations;

     (j) Payments Rescinded.  Any payment by the Company to any Agent or Lender
is held to constitute a preference under the bankruptcy laws, or for any reason
an Agent or Lender is required to refund such payment or pay such amount to the
Company or someone else; or

     (k) Other Actions Taken or Omitted.  Any other action taken or omitted to
be taken with respect to the Credit Agreement or the other Security Instruments,
the Obligations, or the security and collateral therefor, whether or not such
action or omission prejudices the Guarantor or increases the likelihood that the
Guarantor will be required to pay the Obligations pursuant to the terms hereof;
it being the unambiguous and unequivocal intention of the Guarantor that the
Guarantor shall be obligated to pay the Obligations when due, notwithstanding
any occurrence, circumstance, event, action, or omission whatsoever, whether
contemplated or uncontemplated, and whether or not otherwise or particu  larly
described herein, except for the full and final payment and satisfaction of the
Obligations.

     SECTION 2.09  SUBROGATION.  Until the Obligations have been paid in full
and the Aggregate Commitments terminated, the Guarantor hereby waives any claim,
right or remedy which the Guarantor may now have or hereafter acquire against
the Company which arises out of this Guaranty Agreement or from the performance
by the Guarantor hereunder, including without limitation, any claim, remedy or
right of subrogation, reimbursement, exoneration, indemnification, or
participation in any such claim, right or remedy of any other Person against the
Company.  The Guarantor further waives any benefit of any right to participate
in any security now or hereafter held by the Agents and/or the Lenders.

                                  ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

     SECTION 3.01  BY THE GUARANTOR.  In order to induce the Agents and the
Lenders to accept this Guaranty Agreement, the Guarantor represents and warrants
to the Agents and the Lenders (which representations and warranties will survive
the creation of the Obligations and any extension of credit thereunder) that:

     (a) Benefit to the Guarantor.  The Company is a wholly-owned Subsidiary of
the Guarantor; and the Guarantor's guaranty pursuant to this Guaranty Agreement
reasonably may be expected to benefit, directly or indirectly, the Guarantor;
and the Guarantor has determined that this Guaranty Agreement  is necessary and
convenient to the conduct, promotion and attainment of the business of the
Guarantor and the Company.

                                      -5-
<PAGE>
 
     (b) Solvency.  It (i) is not insolvent as of the date hereof and will not
be rendered insolvent as a result of this Guaranty Agreement or the transactions
contemplated by the Credit Agreement or the making of the Loans or issuance of
Letters of Credit thereunder, (ii) is not engaged in business or a transaction,
or about to engage in a business or a transaction, for which any Property or
assets remaining with the Guarantor is unreasonably small capital, and (iii)
does not intend to incur, or believe it will incur, debts that will be beyond
its ability to pay as such debts mature.

     (c) No Representation by Agents or Lenders.  Neither any Agent, Lender nor
any other Person has made any representation, warranty or statement to the
Guarantor in order to induce the Guarantor to execute this Guaranty Agreement.

                                   ARTICLE IV
                         SUBORDINATION OF INDEBTEDNESS

     SECTION 4.01  SUBORDINATION OF ALL GUARANTOR CLAIMS.  As used herein, the
term "Guarantor Claims" shall mean all debts and obligations of the Company to
the Guarantor, whether such debts and obligations now exist or are hereafter
incurred or arise, or whether the obligation of the Company thereon be direct,
contingent, primary, secondary, several, joint and several, or otherwise, and
irrespective of whether such debts or obligations be evidenced by note,
contract, open account, or otherwise, and irrespective of the Person or Persons
in whose favor such debts or obligations may, at their inception, have been, or
may hereafter be created, or the manner in which they have been or may hereafter
be acquired by the Guarantor.  Except for payments permitted by the Credit
Agreement, until the Obligations shall be paid and satisfied in full, the
Aggregate Commitments are terminated and the Guarantor shall have performed all
of its obligations hereunder and the Security Instruments to which it is a
party, the Guarantor shall not receive or collect, directly or indirectly, from
the Company any amount upon the Guarantor Claims.

     SECTION 4.02  CLAIMS IN BANKRUPTCY.  In the event of receivership,
bankruptcy, reorganization, arrangement, debtor's relief, or other insolvency
proceedings involving the Company, the Administrative Agent on behalf of the
Agents and the Lenders shall have the right to prove their claim in any proceed
ing, so as to establish their rights hereunder and receive directly from the
receiver, trustee or other court custodian, dividends and payments which would
otherwise be payable upon Guarantor Claims.  The Guarantor hereby assigns such
dividends and payments to the Administrative Agent for the benefit of the Agents
and the Lenders.  Should any Agent or Lender receive, for application upon the
Obligations, any such dividend or payment which is otherwise payable to the
Guarantor, and which, as between the Company and the Guarantor, shall constitute
a credit upon the Guarantor Claims, then upon payment in full of the
Obligations, the Guarantor shall become subrogated to the rights of the Agents
and the Lenders to the extent that such payments to the Agents and the Lenders
on the Guarantor Claims have contributed toward the liquidation of the
Obligations, and such subrogation shall be with respect to that proportion of
the Obligations which would have been unpaid if the Agents and the Lenders had
not received dividends or payments upon the Guarantor Claims.

     SECTION 4.03  PAYMENTS HELD IN TRUST.  In the event that notwithstanding
Sections 4.01 and 4.02, the Guarantor should receive any funds, payments, claims
or distributions which is prohibited by such Sections, the Guarantor agrees (a)
to hold in trust for the Agents and the Lenders an amount equal to the amount of
all funds, payments, claims or distributions so received, and (b) that it shall
have

                                      -6-
<PAGE>
 
absolutely no dominion over the amount of such funds, payments, claims or
distributions except to pay them promptly to the Administrative Agent, for the
benefit of the Agents and the Lenders; and the Guarantor covenants promptly to
pay the same to the Administrative Agent.

     SECTION 4.04  LIENS SUBORDINATE.  The Guarantor agrees that, until the
Obligations are paid in full and the Aggregate Commitments terminated, any Liens
upon the Company's assets securing payment of the Guarantor Claims shall be and
remain inferior and subordinate to any Liens upon the Company's assets securing
payment of the Obligations, regardless of whether such encumbrances in favor of
the Guarantor, any Agent or Lender presently exist or are hereafter created or
attach.  Without the prior written consent of the Administrative Agent, the
Guarantor, during the period in which any of the Obligations are outstanding or
the Aggregate Commitments are in effect, shall not (a) exercise or enforce any
creditor's right it may have against the Company, or (b) foreclose, repossess,
sequester or otherwise take steps or institute any action or proceeding
(judicial or otherwise, including without limitation the commencement of or
joinder in any liquidation, bankruptcy, rearrangement, debtor's relief or
insolvency proceeding) to enforce any Lien, mortgages, deeds of trust, security
interest, collateral rights, judgments or other encumbrances on assets of the
Company held by the Guarantor.

     SECTION 4.05  NOTATION OF RECORDS.  All promissory notes and, upon the
request of the Administrative Agent, all accounts receivable ledgers or other
evidence of the Guarantor Claims accepted by or held by the Guarantor shall
contain a specific written notice thereon that the indebtedness evidenced
thereby is subordinated under the terms of this Guaranty Agreement.

                                   ARTICLE V
                                 MISCELLANEOUS

     SECTION 5.01  SUCCESSORS AND ASSIGNS.  This Guaranty Agreement is and shall
be in every particular available to the successors and assigns of the Agents and
the Lenders and is and shall always be fully binding upon the legal
representatives, successors and assigns of the Guarantor, notwithstanding that
some or all of the monies, the repayment of which this Guaranty Agreement
applies, may be actually advanced after any bankruptcy, receivership,
reorganization or other event affecting either the Company or the Guarantor.

     SECTION 5.02  NOTICES.  Any notice or demand to the Guarantor under or in
connection with this Guaranty Agreement may be given and shall conclusively be
deemed and considered to have been given and received in the manner and to the
address of the Guarantor as provided for in Section 12.02 of the Credit
Agreement.

     SECTION 5.03  AUTHORITY OF ADMINISTRATIVE AGENT.  The Guarantor
acknowledges that the rights and responsibilities of the Administrative Agent
under this Guaranty Agreement with respect to any action taken by the
Administrative Agent or the exercise or non-exercise by the Administrative Agent
of any option, right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Guaranty Agreement shall, as between
the Agents and the Lenders, be governed by the Credit Agreement and by such
other agreements with respect thereto as may exist from time to time among them,
but, as between the Administrative Agent and the Guarantor, the Administrative
Agent shall be conclusively presumed to be acting as agent for the Lenders with
full and valid authority so to act or

                                      -7-
<PAGE>
 
refrain from acting; and the Guarantor shall not be under any obligation, or
entitlement, to make any inquiry respecting such authority.

     SECTION 5.04  CONSTRUCTION.  THIS GUARANTY AGREEMENT (INCLUDING, BUT NOT
LIMITED TO, THE VALIDITY AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

     SECTION 5.05  PRIOR GUARANTY.  This Guaranty supersedes and replaces that
certain Guaranty Agreement dated as of July 18, 1994, as amended, given
previously by the Guarantor in favor of the Administrative Agent and others.

     SECTION 5.06  SURVIVAL OF OBLIGATIONS.  To the extent that any payments on
the Obligations or proceeds of any collateral are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, debtor in possession, receiver or other Person under any bankruptcy
law, common law or equitable cause, then to such extent, the Obligations so
satisfied shall be revived and continue as if such payment or proceeds had not
been received and the Agents' and the Lenders' Liens, rights, powers and
remedies under this Guaranty Agreement and each Security Instrument shall
continue in full force and effect.  In such event, each Security Instrument
shall be automatically reinstated and the Guarantor shall take such action as
may be reasonably requested by the Administrative Agent and the Lenders to
effect such reinstatement.

     SECTION 5.07  SUBJECT TO THE INTERCREDITOR AGREEMENT.  This Guaranty
Agreement is subject to the terms of the Intercreditor Agreement which (a)
subjects the ability of the Lender Group to pursue remedies hereunder to the
prior consent of the Canadian Lenders and (b) sets forth a priority for the
application of proceeds upon any disposition of amounts received hereunder.

                                      -8-
<PAGE>
 
     WITNESS THE EXECUTION HEREOF, effective as of the date first written above.


                                       UNITED MERIDIAN CORPORATION



                                       By:
                                          --------------------------------
                                          Kevin McMillan
                                          Vice President and Treasurer


     UMC Petroleum Corporation hereby consents to and agrees to comply with the
terms of this Guaranty Agreement.

                                       UMC PETROLEUM CORPORATION



                                       By:
                                          --------------------------------
                                          Kevin McMillan
                                          Vice President and Treasurer

                                      -9-