EXHIBIT 10.112

                          PURCHASE AND SALE AGREEMENT
                         GREEN CANYON AREA, OUTER CONTINENTAL SHELF



      THIS  PURCHASE AND SALE  AGREEMENT (the   Agreement ) is  executed this
  18th day of  October, 1995,  by and between Enserch  Exploration, Inc.,  a
  Texas corporation,  as seller  ( Seller ) and Reading  & Bates Development
  Co., a Delaware corporation, as buyer ( Buyer ).

                                    RECITALS

      WHEREAS,  Seller desires to sell  and Buyer desires to purchase certain
  oil and  gas properties  and related  rights on  the terms  and conditions
  provided in this Agreement;

      NOW, THEREFORE, Seller and Buyer hereby agree as follows:

      1. SALE AND PURCHASE

         1.1   Sale.   Subject   to  the   terms  and   conditions  of   this
  Agreement, Seller shall sell and  Buyer shall purchase and pay for, at the
  Closing but effective as of 12:01 a.m., Central Standard Time, May 1, 1995
  (the   Effective  Date ),  the  undivided  rights,  titles  and  interests
  reflected in Exhibit 1.1 hereof  (being an undivided twenty  percent (20%)
  of the interest of Seller) in and to the assets described below located in
  or pertaining to the Green Canyon Area on the  Outer Continental Shelf off
  the coastline of the State of Louisiana (the undivided  rights, titles and
  interests reflected  in Exhibit 1.1 hereof shall  hereinafter sometimes be
  referred to as the  Assets ).  The  Assets shall consist of the  undivided
  right, title and interest reflected on Exhibit 1.1:

         (a)   In  and to  the  oil,  gas  and mineral  leasehold  interests,
               described  on Exhibit 1.1,  Part (a)  (the  Leases ), together
               with a like interest  with respect to the Leases in and to any
               and  all (i) mineral interests, (ii) overriding or landowners'
               royalty interests, (iii) surface and subsurface  interests and
               rights,  (iv)     beneficial,   convertible  or   reversionary
               interests,  (v) interest owned, claimed or  acquired, or to be
               owned,  claimed or  acquired,  by agreement,  (vi)  production
               payments,  (vii)  contractual  interests  owned  pursuant   to
               participation  agreements,  operating  agreements  or  similar
               agreements, and (viii) any and  all like or unlike  interests,
               including  without limitation those  specific items identified
               on Exhibit 1.1, Part (a).  This shall include  any contractual
               rights providing for the acquisition or earning of any  of the
               foregoing,  and Seller's  rights  in  respect of  any  pooled,
               communitized  or  unitized   acreage  of  which  any   of  the
               foregoing is  a part.   Except  that this Agreement  shall not
               cover  or pertain to or affect any right, title or interest of
               Seller in  and to,  or any  rights derived  from, any  bidding
               agreements  executed  by  and  between  Seller  and  Mobil Oil
               Exploration & Producing Southwest Inc.   (All of the foregoing
               shall be called collectively the  Leasehold Interests. )

         (b)   In  and  to any  and  all  wells,  wellbores, pipe,  gathering
               lines,   compressors,   facilities,    equipment,   platforms,
               pipelines and  any and all  other personal, real, movable  and
               immovable property,  fixtures or equipment  which are  located
               on  or  used  directly  in  connection  with  the  production,
               treatment or transportation  of oil and gas from the Leasehold
               Interests,   including,   without   limitation,  those   items
               specifically  identified  on  Exhibit   1.1,  Part  (b)   (the
                Equipment ).

         (c)   In   and  to  any   and  all   easements,  rights of way,  and
               subsurface   and  surface   rights  associated   or  used   in
               connection with  any such  easements  or rights of way,  which
               easements,  rights-of-way and  subsurface  and surface  rights
               have been  obtained for use  in connection with the  Leasehold
               Interests (the  Gathering Facilities ).

         (d)   In and  to any and  all oil, gas  and other  minerals produced
               from or attributable  to the Leasehold Interests  on or  after
               the Effective Date.

         (e)   To  the  extent the  same  are assignable  or  transferable by
               Seller and to the extent and only to  the extent that the same
               relate   to  the  ownership  or  operation  of  the  Leasehold
               Interests, the  Gathering Facilities  or the  Equipment on  or
               after the  Effective  Date, a  like  interest  in and  to  all
               orders,  contracts,  agreements (including  without limitation
               all  operating  agreements,  transportation  agreements,  unit
               agreements,    participation   agreements    and    processing
               agreements), instruments,  licenses, authorizations,  permits,
               audits,  claims, liens,  suits, settlements  and demands,  and
               other  rights,   privileges,  benefits,   duties  and   powers
               conferred upon Seller.   Except that this Agreement  shall not
               cover or pertain  to or affect any right, title or interest of
               Seller in  and to,  or any  rights derived  from, any  bidding
               agreements  executed  by  and  between  Seller  and  Mobil Oil
               Exploration & Producing Southwest Inc.

      1.2   Title Warranty.  Seller warrants that:

         (a)   Except  as  specifically  set  forth  in  Exhibit  1.1  and/or
               Exhibit  3.7  or   resulting  from  the  application   of  the
               agreements  listed  therein, neither  Seller  nor  any parent,
               subsidiary  or  affiliate  of Seller  during  their respective
               periods  of ownership has  (A) executed  any deed, conveyance,
               assignment  or  other  instrument  as  an  assignor,  grantor,
               sublessor  or in  another  capacity or  (B)  has breached  any
               obligation under  any Lease  that would (i)  result in Buyer's
               being entitled to  receive less than the  net revenue interest
               for any Lease, well or  unit set forth in Exhibit  1.1, except
               as  otherwise noted  on Exhibit 1.1,  of all  oil and  gas in,
               under, and  that may be  produced, saved and  marketed from or
               attributable to such  Lease, well  or unit,  or (ii)  obligate
               Buyer  to   bear  the  costs  and  expenses  relating  to  the
               maintenance,  development and operation of such Lease, well or
               unit in an amount greater  than the working interest  for such
               Lease, well  or unit set forth in Exhibit  1.1, unless the net
               revenue  interest  attributable  to said  working  interest is
               increased by a proportionate or greater amount; and

         (b)   Except  as  specifically  set  forth  in  Exhibit  1.1  and/or
               Exhibit  3.7  or   resulting  from  the  application   of  the
               agreements listed therein, the  Assets are free of  all Seller
               created liens, security  interests and encumbrances created by
               or through Seller as of the Closing Date;

  (the limited warranty  set forth in subparagraphs (a) and (b)  above shall
  hereinafter be  referred to  as the  Special Limited  Warranty ).   Seller
  shall convey the Assets with no warranty whatsoever other than the Special 
  Limited Warranty, but  with full substitution and subrogation to  Buyer in
  and to all covenants, agreements,  representations and warranties made  by
  others  heretofore given or made in connection with the Assets or any part
  thereof.

      1.3   Other  Warranty Provisions.  Buyer acknowledges  that (a)  Seller
  has not made any warranty or representation, whether express, implied,  at
  common  law, by  statute  or otherwise,  relating  to the  fitness  for an
  intended  purpose or  condition  of  any movable  property  constituting a
  portion of the Assets and (b) Buyer  shall acquire such personal  property
  in  WHERE IS, AS IS   condition.  Except as may be  specifically set forth
  to the contrary in this Agreement, Buyer acknowledges that Seller has made
  no  representations or warranties whatever, expressed  or implied, (Seller
  having  hereby  expressly  disclaimed  all  such  warranties)  as  to  the
  accuracy, completeness, or materiality of any data, information, record or
  materials now, heretofore, or hereafter made available in  connection with
  this Agreement (including, without limitation, any descriptions of oil and
  gas leases;  quality or  quantity or hydrocarbon  reserves attributable to
  the Assets, if any; production  rates, exploratory or development drilling
  opportunities,  decline rates,  potential  for production  of hydrocarbons
  from  the Assets; the  environmental condition of said  Assets; the legal,
  tax or other consequences  of owning Seller's interest  in the Assets;  or
  any other  information contained  in any material  furnished in connection
  with this  transaction).  Any  and all such data,  information, records or
  materials furnished by Seller  to Buyer is provided  as a convenience only
  and  any reliance on or use of same is at  the Buyer's sole risk.  WITHOUT
  LIMITING THE GENERALITY OF THIS PARAGRAPH, SELLER DISCLAIMS AND NEGATES AS
  TO ANY PERSONAL PROPERTY, FIXTURES, IMPROVEMENTS AND APPURTENANCES SUBJECT
  TO  THIS AGREEMENT  (INCLUDING  ALL  WELLS): (A)  ANY IMPLIED  OR  EXPRESS
  WARRANTY  OF  MERCHANTABILITY,  (B)  ANY IMPLIED  OR  EXPRESS WARRANTY  OF
  FITNESS FOR A PARTICULAR PURPOSE, AND  (C) ANY IMPLIED OR EXPRESS WARRANTY
  OF CONFORMITY TO MODELS OR SAMPLE OR  MATERIALS.  THE PURCHASER  EXPRESSLY
  AGREES THAT TITLE TO  SUCH PERSONAL  PROPERTY, FIXTURES, IMPROVEMENTS  AND
  APPURTENANCES WILL BE ACCEPTED "AS IS", "WHERE IS", "WITH ALL FAULTS", AND
  IN ITS PRESENT CONDITION AND STATE OF REPAIR.

      2. PURCHASE PRICE AND OTHER CONSIDERATION.

      2.1   Determination  of Purchase  Price.   The  purchase price  for the
  Assets (the  Purchase Price ) shall be Eighteen Million Two Hundred  Fifty
  Thousand and No/100 Dollars ($18,250,000.00) (the  Purchase Price );

      2.2   Payment of Purchase  Price.  The  payment of  the Purchase  Price
  shall be made  by Buyer to  Seller  pursuant  to the terms and  provisions
  ofthe  agreement between  Buyer and  Seller concerning  the timing  of the
  payment of the Purchase Price, attached hereto and made  a part hereof for
  all  purposes as  Exhibit 5.2(c).    Failure of  Buyer  to conform  to and
  perform the payment of the Purchase Price in accordance with the terms and
  provisions of such ancillary agreement covering same, shall be grounds for
  the rescission of this Agreement by Seller, and Buyer shall reassign  unto
  Seller  all  of  the  interests  which  Buyer  has  acquired  from  Seller
  hereunder.   Such  reassignment shall  be free  and clear  of any  and all
  burdens and encumbrances on the Assets,  save and except those burdens and
  encumbrances affecting the Assets as of the date hereof.

      3. REPRESENTATIONS OF SELLER.

      As a  principal cause and  material inducement to  Buyer's execution of
  this   Agreement  and   to  Buyer's   consummation  of   the  transactions
  contemplated  hereby, and  with the  acknowledgment by  Seller  of Buyer's
  reliance hereon, Seller, to the extent set forth below and with respect to
  the undivided interests in the Assets covered hereby, represents to  Buyer
  that as of the date hereof: 

      3.1   Existence  of  Seller. Seller  is  a corporation  duly organized,
  validly  existing and  in good  standing under  the laws  of the  State of
  Texas. 

      3.2   Power  of Seller.  Seller has  the requisite  corporate power  to
  enter into and perform  this Agreement  and the transactions  contemplated
  hereby.  Subject to rights to consent by, required notices to, and filings
  with  or  other  actions  by governmental  entities  where  the  same  are
  customarily obtained subsequent to the assignment of oil and gas interests
  and leases, the  execution, delivery and performance of this  Agreement by
  Seller, and the transactions contemplated hereby, will not violate (i) any
  provision of the articles  of incorporation or bylaws of Seller, (ii)  any
  material  agreement or instrument to which  Seller is a party  or by which
  Seller is  or the Assets  owned by  Seller are bound,  (iii) any judgment,
  order,  ruling, or decree applicable to the Assets or to Seller as a party
  in interest, or (iv) any law, rule  or regulation applicable to Seller  or
  to the ownership or operation of the Assets.

      3.3   Authorization  of   Seller.      The  execution,   delivery   and
  performance  of this  Agreement and  the transactions  contemplated hereby
  have been duly and validly authorized by all requisite corporate action on
  the part of Seller.  This Agreement  has been duly executed and  delivered
  on  behalf of  Seller, and  at the  Closing all documents  and instruments
  required hereunder to be  executed and delivered by Seller shall have been
  duly executed and delivered.   This Agreement does, and such documents and
  instruments shall,  constitute  legal, valid  and binding  obligations  of
  Seller enforceable  in accordance  with their terms,  subject, however, to
  the  effect  of bankruptcy,  insolvency,  reorganization,  moratorium  and
  similar  laws from  time to  time  in effect  relating  to the  rights and
  remedies  of  creditors,  as  well as  to  general  principles  of  equity
  (regardless of whether such  enforceability is considered in a  proceeding
  in equity or at  law).

      3.4   Brokers.    Seller  has  incurred  no  obligation  or  liability,
  contingent or otherwise,  for brokers' or finders'  fees in respect of the
  matters  provided  for  in  this Agreement  and  any  such  obligation  or
  liability that might exist and which was incurred by  Seller, shall be the
  sole obligation or liability of Seller.

      3.5   Foreign Person.   Seller  is not  a  foreign  person  within  the
  meaning of the Sections 1445 and 7701 of Internal Revenue Code of 1986, as
  amended (the  "Code") (i.e.  Seller is not a  non-resident alien,  foreign
  corporation, foreign partnership, foreign trust or foreign estate as those
  terms are defined in the Code and any regulations promulgated thereunder).

      3.6   Litigation.  There are no actions, suits  or proceedings pending,
  or to the knowledge of  Seller threatened, against or affecting the Assets
  or any portion or portions thereof,  or the operations of  Seller relating
  to  the Assets  or any  portion or  portions thereof,  and to the  best of
  Seller's  knowledge  after reasonable  inquiry,  except  as  set  forth in
  Exhibit 3.9,  no violation  of any laws, statutes,  regulations or  orders
  applicable to any Asset or the operation thereof exists.

      3.7   Contracts,  Agreements, Commitments and Other Matters.  Except as
  set forth  on Exhibit 3.7, to the best of  Seller's knowledge, information
  and belief after reasonable inquiry,  there are no contracts,  agreements,
  understandings, commitments, or other obligations (other than the oil, gas
  and mineral  leases,  surface leases,  rights of way and  other  interests
  described in Exhibit 1.1 hereto and conveyance documents that are a matter
  of  public record in the Louisiana coastal parishes  adjacent to where the
  Assets  are  located  or  that  are filed  in  the   Lease  File   records
  maintained in the New Orleans District of the Minerals Management  Service
  (the  MMS ) or joint bidding agreements executed by and between Seller and 
  Mobil, with  respect to  the  Leases) affecting  the Assets  which are  in
  effect as of the date hereof.

      3.8   Consents  and  Preferential  Purchase  Rights.   Except  for  any
  consent, agreement or waiver from Manta Ray Gathering Systems, Inc. (which
  consent,  agreement  or waiver  may  not  be needed)  and  except for  any
  governmental  consents  necessary  under the  Hart-Scott-Rodino Anti-trust
  Improvements Act,  there  are no  consents (except  governmental  consents
  which  are customarily obtained  after the  assignment of  an oil  and gas
  lease), agreements  or waivers  of preferential  rights  necessary to  the
  valid assignment  of the  Assets to  Buyer at  Closing that  have not been
  affirmatively waived  or deemed to have  been waived by expiration  of the
  appropriate notice period, and  there are no preferential purchase  rights
  or calls on production  with respect to the  production from the Leasehold
  Interests, except as may be provided  in the agreements listed  in Exhibit
  3.7, which limit  the purchase  price for  oil or  gas, or  which are  not
  subject to termination upon 60 days' notice.

      3.9   Environmental  Matters.  Except  as  specifically  set  forth  on
  Exhibit  3.7 and/or  as  to  operations conducted  by parties  other  than
  Seller,  to the best  of Seller's knowledge, information  and belief after
  reasonable inquiry, there exists  no Environmental Defect with respect  to
  the Assets.   An  Environmental Defect means a  condition or  circumstance
  that exists in connection with the Leasehold Interests or the other Assets
  that is not  in material  compliance with  any law,  regulation, order  or
  judgment of or agreement with  any federal, state or local agency or court
  relating to  the environment  or that under such  law, regulation,  order,
  judgment or agreement  requires the  owner or operator of  such leases  or
  assets  to  undertake  any  cleanup,  remediation  or  other  expense  (an
   Environmental Defect ).

      3.10  Open Wells.  To the  best of Seller's knowledge,  information and
  belief after reasonable inquiry,  except for  wells identified in  Exhibit
  1.1,  Part (b),  there  exists  no well  that  is  located on  any  of the
  Leasehold  Interests and that  is not plugged and  abandoned in accordance
  with applicable rules, regulations and contractual obligations.

      3.11  Casualty Losses.  To the best of Seller's knowledge,  information
  and belief after reasonable inquiry, there has occurred no casualty in any
  Asset since the  Effective Date that materially and adversely  affects the
  value, use or operation of such Asset.

      3.12  Information.    No   documents  were  intentionally  removed   or
  information  or documents omitted from the data or documentation furnished
  by  Seller  to Buyer  that  is necessary  to make  the data  furnished not
  misleading in any material respect; provided, however, this representation
  is  limited  solely  to  matters  of fact  and  specifically  excludes any
  statement  or  forecast  of existing  or  future  reserves,  geologic  and
  engineering   interpretations,   forecasts,    estimates   and    economic
  assumptions, including without limitation (i) future prices of production,
  (ii)  future  operating  costs, (iii)  future  capital expenditures,  (iv)
  projections  and estimates of  future reserves and production  and (v) the
  prospects for successfully completing wells.

      3.13  Compliance  with  Laws.   Except  as  specifically  set forth  on
  Exhibit  3.9 and/or  as  to  operations conducted  by parties  other  than
  Seller,  to the best  of Seller's knowledge, information  and belief after
  reasonable inquiry, Seller  has operated the Assets, or caused  the Assets
  to be operated,  in compliance with all laws, ordinances,  regulations and
  orders  applicable  to  the  Assets  and   the  operations  undertaken  in
  connection therewith. 

      3.14  Use  of  Buyer's  Equipment/Personnel.    While  it  is  Seller's
  present intention to employ a floating production vessel to be provided by
  Buyer or one of its affiliated companies, as previously proposed by Buyer,
  in  the development  and  production  of the  Assets, it  is  specifically
  understood and agreed by and between Seller and Buyer, that the employment
  of any  such system and  the provision  by Buyer  of any  such system,  is
  specifically subject  to the  approval by  and the  rights of the  various
  owners of the interests of which the Assets constitute a part and that the
  Operating Agreement described in  Article 5.2(e), shall govern and control
  the determination of such matters.   Seller has made no, and will bear  no
  liability for any, representation to the contrary.

      4. REPRESENTATIONS OF BUYER. 

      As a principal cause and  material inducement to Seller's  execution of
  this  Agreement   and  to  Seller's  consummation   of  the   transactions
  contemplated hereby,  and  with the  acknowledgment by  Buyer of  Seller's
  reliance hereon, Buyer represents to Seller that as of the date hereof:

      4.1   Existence  of Buyer.    Buyer is  a  corporation duly  organized,
  validly  existing and  in good  standing under  the laws  of the  State of
  Delaware. 

      4.2   Power of Buyer.   Buyer has the requisite power to enter into and
  perform this Agreement and the transactions contemplated hereby.   Subject
  to consent by,  required notices to, and filings  with or other actions by
  governmental  entities where the same are  customarily obtained subsequent
  to the  assignment of  oil and  gas interests and  leases, the  execution,
  delivery and performance of this Agreement by Buyer, and the  transactions
  contemplated hereby, will not violate (i) any provision of the articles of
  incorporation  or   bylaws  of  Buyer,  (ii)  any  material  agreement  or
  instrument to which Buyer is a party or by which Buyer is bound, (iii) any
  judgment, order,  ruling,  or decree  applicable to  Buyer as  a party  in
  interest, or (iv) any law, rule or regulation applicable to Buyer.

      4.3   Authorization  of Buyer.  The execution, delivery and performance
  of this Agreement and the transactions contemplated hereby have been  duly
  and validly authorized  by all requisite corporate  action on the  part of
  Buyer.  This Agreement  has been duly executed and delivered on  behalf of
  Buyer, and at the Closing all documents and instruments required hereunder
  to be  executed and delivered by  Buyer shall have  been duly executed and
  delivered.  This Agreement does, and such documents and instruments shall,
  constitute legal,  valid and binding obligations  of Buyer  enforceable in
  accordance  with  their   terms,  subject,  however,  to  the   effect  of
  bankruptcy, insolvency, reorganization, moratorium  and similar laws  from
  time to time in effect relating to  the rights and remedies of  creditors,
  as well as  to general  principles of equity  (regardless of  whether such
  enforceability is considered in a proceeding in equity or at law).

      4.4   Brokers.     Buyer  has  incurred  no  obligation  or  liability,
  contingent  or otherwise, for brokers'  or finders' fees in respect of the
  matters  provided  for  in  this Agreement  and  any  such  obligation  or
  liability that might  exist and which was incurred  by Buyer, shall be the
  sole obligation of Buyer.

      4.5   Title Examination.  Buyer has conducted a title examination  with
  respect  to Seller's interests  in the Assets and  acknowledges that there
  are no title defects which  will prevent the closing under this Agreement.
  Buyer has disclosed, prior to the execution of this Agreement, to the best
  of its  knowledge, information  and belief, all known  or suspected  title
  defects  which  may  place  Seller  in  breach  of  its  warranty  or  its
  representations hereunder.  

      4.6   MMS  Approval.   Buyer has contemporaneously  with the Closing of
  the  transaction contemplated by this  Agreement, filed  with the Minerals
  Management Service,  what it believes to be  the appropriate documentation
  for the approval of Buyer as an owner and operator of the Assets.  Subject
  only  to  the  approval  of Buyer's  filing  described  in  the  preceding
  sentence,  Buyer is  not aware of  the existence of any  fact or condition
  with respect to  Buyer or the  Assets that may cause  the MMS to  withhold
  unconditional  approval,  to the  extent  MMS approval  is required  under
  applicable law, of the transfer of the Assets from Seller to Buyer.

      5. CLOSING.

      5.1   Time and Place  of Closing.  The consummation of the transactions
  contemplated hereby (the  Closing ) is  to be held at the offices of Buyer
  on or before October 20,  1995 or within five (5) business days  after the
  receipt of any required governmental approvals or within five (5) business
  days after  the time  for any governmental objection  has expired  (namely
  Hart-Scott-Rodino approval),  whichever of  the three  dates is  the later
  date, unless extended by the mutual consent  of the parties hereto.   (The
  date on  which the  Closing occurs  shall be  referred to  as the  Closing
  Date. )

      5.2   Closing Obligations.  At the Closing:

         (a)   Seller shall  execute, acknowledge  and deliver  to Buyer  the
               conveyance instruments  in the  form of  Exhibit 5.2(a)  which
               will  convey  title  to  the  Assets   to  Buyer  and  deliver
               possession  thereof to Buyer together with all requisite forms
               required to  accompany such  assignments for  filing with  the
               MMS.

         (b)   Seller  shall  execute such  other  instruments and  take such
               other action as  may be necessary to carry out its obligations
               under this Agreement.

         (c)   Buyer  shall   execute  and  deliver  to Seller  an  ancillary
               agreement  covering and pertaining to the scheduled payment of
               the Purchase Price  in the form  of and  containing the  terms
               and  provisions found in Exhibit  5.2(c) and  also execute and
               deliver to Seller,  the mortgage and security  agreement, note
               and financing statement described therein.

         (d)   Buyer  shall execute  such  other  instruments and  take  such
               other action as  may be necessary to carry out its obligations
               under this Agreement.

         (e)   Buyer  and Seller  shall  execute and  deliver, each  unto the
               other,  the Operating Agreement  dated effective  May 1, 1995,
               which agreement  has been  negotiated between  the Seller  and
               Buyer and Mobil  Oil Corporation, et al., and  which agreement
               shall govern the  ownership and operation of the Assets on and
               after the Effective Date (the "Operating Agreement").

         (f)   Buyer   shall   execute   and   deliver   unto   Seller,   the
               Authorization  for Expenditure attached hereto and made a part
               hereof  for  all  purposes  as  Exhibit  5.2(f),  covering and
               pertaining  to  the drilling  and/or  completion of  the OCS-G
               7049 #5 Well.

         (g)   Buyer  shall  execute   and  deliver  to  Seller   the  Option
               Agreement covering and  pertaining to the option  set forth in
               Section 8.15, in  the form of Exhibit 5.2 (g), attached hereto
               and made a part hereof for all purposes. 

         (h)   Buyer shall pay in cash to Seller, the sum of Six Million  Two
               Hundred Fifty Thousand and No/100 Dollars ($6,250,000.00)

      6. POST-CLOSING OBLIGATIONS.

      6.1   Assumption  of Obligations and  Grant of  Indemnities Relating to
  Operations.  

         (a)   SUBJECT TO EACH OF THE FOLLOWING EXCEPTIONS:

            (X)   EXCEPT AS TO THOSE MATTERS DESCRIBED IN SECTION 6.1(B)  AND
                  TO THE LIMITED EXTENT  THAT SELLER HAS AGREED  TO INDEMNIFY
                  BUYER AS PROVIDED IN SUCH SECTION 6.1(B); AND

            (Y)   EXCEPT  TO THE EXTENT ANY  OF THE FOLLOWING IS ATTRIBUTABLE
                  TO  THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SELLER AT
                  ANY TIME BETWEEN THE EFFECTIVE DATE AND THE CLOSING DATE;

            TO  THE  EXTENT OF  ITS  INTEREST  IN  THE  ASSETS, BUYER  HEREBY
            ASSUMES ALL OF  THE FOLLOWING DESCRIBED OBLIGATIONS,  AND SUBJECT
            TO  THE  TERMS, PROVISIONS  AND  LIMITATIONS  OF  THE   OPERATING
            AGREEMENT   DESCRIBED   IN  ARTICLE   5.2(e),  BUYER   AGREES  TO
            INDEMNIFY,  DEFEND  AND   HOLD  HARMLESS  SELLER,  ITS  OFFICERS,
            DIRECTORS,  SHAREHOLDERS,  EMPLOYEES, AGENTS  AND REPRESENTATIVES
            (THE   SELLER  GROUP ), REGARDLESS  OF  WHETHER SELLER  GROUP WAS
            WHOLLY  OR PARTIALLY  NEGLIGENT OR OTHERWISE  AT FAULT,  FROM AND
            AGAINST  ANY  AND  ALL  CLAIMS,  LIABILITIES,  LOSSES,  COSTS AND
            EXPENSES  (INCLUDING,   WITHOUT  LIMITATION,   COURT  COSTS   AND
            REASONABLE ATTORNEYS' FEES) ARISING FROM:

            (I)   EVENTS   THAT  TRANSPIRE  OR   CONDITIONS  THAT  COME  INTO
                  EXISTENCE AFTER  THE EFFECTIVE  DATE THAT ARE  ATTRIBUTABLE
                  TO THE OWNERSHIP  OR OPERATION OF  THE ASSETS  ON OR  AFTER
                  THE EFFECTIVE DATE;

            (II)  THE PROPER  PLUGGING AND  ABANDONMENT OF  ALL WELLS NOW  OR
                  HEREAFTER LOCATED ON THE LEASEHOLD INTERESTS;

            (III) THE ABANDONMENT OF THE GATHERING FACILITIES; AND

            (IV)  ALL LIABILITY FOR  PROPERTY DAMAGE OR INJURY TO OR DEATH OF
                  PERSONS  OCCURRING AFTER THE EFFECTIVE DATE AND ARISING OUT
                  OF  THE OWNERSHIP OR OPERATION OF THE ASSETS, REGARDLESS OF
                  WHETHER SAID DAMAGES  OR INJURY IS ATTRIBUTABLE IN WHOLE OR
                  IN PART  TO CONDITIONS  THAT EXISTED  BEFORE THE  EFFECTIVE
                  DATE.

            ADDITIONALLY,   BUYER  HEREBY  ASSUMES,  TO  THE  EXTENT  OF  ITS
            INTERESTS IN  THE ASSETS  CONVEYED BY SELLER  TO BUYER  HEREUNDER
            AND TO  THE EXTENT  THE SAME  ARE ASSIGNABLE  OR TRANSFERABLE  BY
            SELLER (AND ARE  SO ASSIGNED OR  TRANSFERRED) AND  TO THE  EXTENT
            AND ONLY  TO THE EXTENT THAT THE SAME  RELATE TO THE OWNERSHIP OR
            OPERATION OF  THE LEASEHOLD  INTERESTS, THE GATHERING  FACILITIES
            OR THE  EQUIPMENT ON  OR AFTER  THE EFFECTIVE  DATE, ANY  AND ALL
            DUTIES  AND  OBLIGATIONS   ARISING  FROM  ANY  AND   ALL  ORDERS,
            CONTRACTS,   AGREEMENTS   (INCLUDING   WITHOUT   LIMITATION   ALL
            OPERATING    AGREEMENTS,    TRANSPORTATION    AGREEMENTS,    UNIT
            AGREEMENTS, PARTICIPATION AGREEMENTS AND PROCESSING  AGREEMENTS),
            INSTRUMENTS,  LICENSES, AUTHORIZATIONS,  PERMITS, AUDITS, CLAIMS,
            LIENS,  SUITS,   SETTLEMENTS  AND  DEMANDS,  AND   OTHER  RIGHTS,
            PRIVILEGES,  BENEFITS   AND   POWERS   CONFERRED   UPON   SELLER,
            INCLUDING, BUT  NOT  LIMITED  TO  THOSE  LISTED  ON  EXHIBIT  3.7
            (COLLECTIVELY  HEREINAFTER  REFERRED  TO  IN  THIS  PARAGRAPH  AS 
            "AGREEMENTS").    SUBJECT   TO  THE  LIMITATIONS  WHICH   MAY  BE
            CONTAINED  IN  THE   OPERATING  AGREEMENT  DESCRIBED  IN  ARTICLE
            5.2(e),  BUYER AGREES  TO  INDEMNIFY,  DEFEND AND  HOLD  HARMLESS
            SELLER, ITS  OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES, AGENTS
            AND REPRESENTATIVES  (THE  SELLER GROUP ),  REGARDLESS OF WHETHER
            SELLER GROUP  WAS WHOLLY  OR PARTIALLY NEGLIGENT  OR OTHERWISE AT
            FAULT,  FROM AND AGAINST ANY AND ALL CLAIMS, LIABILITIES, LOSSES,
            COSTS  AND EXPENSES  (INCLUDING, WITHOUT  LIMITATION, COURT COSTS
            AND  REASONABLE ATTORNEYS' FEES)  ARISING FROM  BUYER'S BREACH OR
            NON-PERFORMANCE OF SUCH AGREEMENTS.


         (b)   AS TO SELLER'S INTEREST IN AND TO  THE ASSETS CONVEYED BY THIS
               AGREEMENT,  SELLER   AGREES  TO  INDEMNIFY,  DEFEND  AND  HOLD
               HARMLESS    BUYER,   ITS    PARTNERS,   OFFICERS,   DIRECTORS,
               SHAREHOLDERS, EMPLOYEES, AGENTS  AND REPRESENTATIVES, AND  THE
               OFFICERS,  DIRECTORS,  SHAREHOLDERS,  EMPLOYEES,  AGENTS   AND
               REPRESENTATIVES  OF   ITS   PARTNERS  (THE    BUYER   GROUP ),
               REGARDLESS  OF  WHETHER BUYER  GROUP  WAS WHOLLY  OR PARTIALLY
               NEGLIGENT OR OTHERWISE  AT FAULT, FROM AND AGAINST ANY AND ALL
               CLAIMS, LIABILITIES,  LOSSES, COSTS  AND EXPENSES  (INCLUDING,
               WITHOUT LIMITATION,  COURT  COSTS  AND  REASONABLE  ATTORNEYS'
               FEES) ARISING FROM:

            (I)   EVENTS  THAT HAVE TRANSPIRED  OR CONDITIONS  THAT HAVE COME
                  INTO  EXISTENCE  PRIOR  TO  THE  EFFECTIVE  DATE  THAT  ARE
                  ATTRIBUTABLE TO THE OWNERSHIP OR OPERATION OF THE ASSETS;

            (II)  ALL LIABILITY FOR  PROPERTY DAMAGE OR INJURY TO OR DEATH OF
                  PERSONS OCCURRING PRIOR  TO THE EFFECTIVE DATE  AND ARISING
                  OUT OF THE OWNERSHIP  OR OPERATION OF THE ASSETS REGARDLESS
                  OF WHETHER CLAIMS  RELATED TO SAID DAMAGE, INJURY  OR DEATH
                  ARE ASSERTED ON, BEFORE OR AFTER THE EFFECTIVE DATE; AND

            (III) THE GROSS  NEGLIGENCE OR  WILLFUL MISCONDUCT  OF SELLER  AT
                  ANY TIME BETWEEN THE EFFECTIVE DATE AND THE CLOSING DATE.

         (c)   NOTWITHSTANDING  THE   FOREGOING  PROVISIONS   SET  FORTH   IN
               SECTIONS 6.3(A)  AND (B),  THE ASSUMPTION, INDEMNITY,  DEFENSE
               AND HOLD HARMLESS  OBLIGATIONS OF BUYER AND  SELLER THEREUNDER
               SHALL NOT  APPLY TO (I) ANY  LIABILITY OF ONE PARTY  HERETO TO
               THE  OTHER PARTY UNDER THE  PROVISIONS OF THIS AGREEMENT, (II)
               EITHER   PARTY'S  COSTS  AND  EXPENSES  WITH  RESPECT  TO  THE
               NEGOTIATION  AND  CONSUMMATION   OF  THIS  AGREEMENT  AND  THE
               PURCHASE AND SALE  OF THE ASSETS, OR (III) ANY AMOUNTS COVERED
               BY  INSURANCE  TO  THE  EXTENT  PAID  OR   REIMBURSED  TO  THE
               INDEMNIFIED   PARTY  (WHO  SHALL  USE  REASONABLE  EFFORTS  TO
               COLLECT SUCH AMOUNTS).  

      6.2   Further Assurances.   After  Closing, Seller  and Buyer agree  to
  take such further actions and to execute, acknowledge and deliver all such
  further  documents  that  are  necessary  or useful  in  carrying  out the
  purposes of this Agreement or of any document delivered pursuant hereto.

      6.3   Governmental  Approvals.  After  Closing, Seller  and Buyer agree
  to take all actions  and to execute all documents reasonably requested  by
  the other party to obtain all necessary permissions, approvals or consents
  required by federal, state or local governmental authorities to consummate
  the  sale  contemplated by  this  Agreement .  If  all  such approvals  or
  consents are not obtained within one (1) year after Closing or such longer
  period as may be mutually agreed in writing by Buyer  and Seller, the sale
  of the Assets  shall be null, Buyer shall  return possession of the Assets
  to  Seller, and  Seller shall return  the Purchase Price to  Buyer. In the 
  event that  the sale is deemed  null, Buyer  shall bear the  risk of  loss
  between  the  Closing  Date  and  the  date  that  Seller  is restored  to
  possession of the Assets.

      6.4   Cooperation.   Each  party to  this Agreement  shall provide  the
  other party  with reasonable  access to all relevant  documents, data  and
  other  information which  may be  required  by the  other parties  for the
  purpose of preparing tax returns and responding to any audit by any taxing
  jurisdiction.   Each party  to  this Agreement  shall cooperate  with  all
  reasonable  requests  of  the  other   parties  made  in  connection  with
  contesting  the  imposition of  taxes.   Notwithstanding  anything  to the
  contrary in this Agreement,  no party to this Agreement shall be  required
  at any  time to  disclose to  the other  parties any  tax return  or other
  confidential tax information.

      6.5   Access.  Seller and Buyer  each shall use its  reasonable efforts
  to afford the other with access to its employees, as follows:  (i), in the
  case  of Seller, employees of  Seller, as Buyer may reasonably request for
  Buyer s  proper  business  purposes,  including  without  limitation,  the
  defense of legal proceedings, who remain employees of Seller following the
  date of  Closing and who  are familiar with the operations  of the Assets,
  and  (ii),  in  the case  of  Buyer, employees  of  Buyer,  as Seller  may
  reasonably  request  for  Seller s  proper  business  purposes,  including
  without limitation,  the defense  of legal proceedings.   Such access  may
  include interviews  or  attendance at  depositions or  legal  proceedings;
  provided, however, that in any event all out-of-pocket expenses (including
  wages  and salaries) reasonably  incurred by any party  in connection with
  this  Section  6.7 shall  be  paid  or promptly  reimbursed  by the  party
  requesting such services.

      7. TAXES.

      7.1   Apportionment of Ad Valorem and  Property Taxes.  All  ad valorem
  taxes,   real  property  taxes,  personal  property   taxes,  and  similar
  obligations ( Property Taxes ) with respect to the tax period in which the
  Effective  Date occurs  shall  be  apportioned as  of the  Effective  Date
  between Seller  and Buyer.  The  owner of  record on  the assessment  date
  shall file or cause to  be filed all required reports and returns incident
  to the  Property Taxes  and shall pay or  cause to  be paid to  the taxing
  authorities all  Property Taxes relating  to the  tax period in which  the
  Effective Date occurs.

      7.2   Sales Taxes.   Any sales, use or other tax on the transfer of the
  Assets from Seller to Buyer shall be paid by Buyer.

      7.3   Other  Taxes.   All  taxes (other  than  income taxes)  which are
  imposed on or with respect  to the production of oil, natural gas or other
  hydrocarbons or  minerals or the receipt of  proceeds therefrom (including
  but not  limited to  severance,  production, and  excise taxes)  shall  be
  apportioned  between  the parties  based  upon  the  respective  shares of
  production  taken by the parties.  All such taxes which have accrued prior
  to the  Effective Date have been  or will be properly  paid or withheld by
  Seller and all  statements, returns, and documents pertinent  thereto have
  been  or will be properly filed by Seller.  Buyer shall be responsible for
  paying or  withholding or causing to  be paid or  withheld all  such taxes
  which have accrued after the Effective Date and for filing all statements,
  returns, and documents incident thereto.

      8. MISCELLANEOUS.

      8.1   Governing Law.  THIS  AGREEMENT AND  ALL INSTRUMENTS EXECUTED  IN
  ACCORDANCE WITH IT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH
  THE SUBSTANTIVE LAWS OF THE STATE OF LOUISIANA, WITHOUT REGARD TO CONFLICT 
  OF LAW  RULES  THAT  WOULD  DIRECT  APPLICATION  OF THE  LAWS  OF  ANOTHER
  JURISDICTION. 
      8.2   Entire  Agreement.    This  Agreement,  including  all   exhibits
  attached hereto and made a part hereof,  together with that certain letter
  agreement relating to the purchase  and sale of the Assets dated April 17,
  1995  executed by and between Seller and Buyer, as  amended, including all
  exhibits  attached thereto and  made a part thereof,  (the  Offer Letter )
  constitute the entire agreement between the parties and together supersede
  all  prior  agreements,  understandings,  negotiations   and  discussions,
  whether oral  or written, of the  parties. In  the event  of any  conflict
  between  this Agreement  and  the  Offer Letter,  the provisions  of  this
  Agreement shall  take precedence.  No supplement,  amendment,  alteration,
  modification, waiver or termination of this Agreement or the Offer  Letter
  shall be binding unless executed in writing by the parties hereto.

      8.3   Waiver.   No waiver of  any of  the provisions of  this Agreement
  shall  be deemed  or  shall constitute  a waiver  of any  other provisions
  hereof  (whether or  not  similar),  nor shall  such waiver  constitute  a
  continuing waiver unless otherwise expressly provided.

      8.4   Captions.   The captions in  this Agreement  are for  convenience
  only and  shall not be considered  part of or  affect the  construction or
  interpretation of any provision of this Agreement.

      8.5   Notices.   Any notice  provided or  permitted to  be given  under
  this  Agreement  shall be  in  writing,  and may  be  served  by  personal
  delivery,  by depositing  same in the  mail, addressed to the  party to be
  notified, postage  prepaid, and  registered  or  certified with  a  return
  receipt requested or  by facsimile transmission.  Notice deposited  in the
  mail in  the manner  hereinabove described  shall be  deemed to  have been
  given and received on the date of the delivery as shown on the
  return receipt.  Notice served in any other manner shall be deemed to have
  been  given  and  received  only  in and  when  actually  received by  the
  addressee.  For purposes of notice, the addresses of  the parties shall be
  as follows:

  Seller's Mailing Address:
                  Enserch Exploration, Inc.
                  4849 Greenville Avenue, Suite 1200
                  Dallas, Texas 75206
                  Attention: James K. Teringo, Jr., Esq.
                  Telephone: (214) 987-6651
                  Fax: (214) 987-6475

  Buyer's Mailing Address:
                  Reading & Bates Development Co.
                  901 Threadneedle, Suite 200
                  Houston, Texas  77079
                  Attention:  Wayne K. Hillin, Esq.
                  Telephone: (713) 496-5000
                  Fax:  (713) 496-0285

  Each party shall have the right, upon giving ten (10) days prior notice to
  the other  in the manner hereinabove  provided, to change  its address for
  purposes of notice.

      8.6   Expenses.   Except as otherwise provided herein, each party shall
  be solely responsible for  all expenses incurred by  it in connection with
  this transaction (including, without  limitation, fees and expenses of its
  own counsel and accountants).

      8.7   Severability.  If any term  or other provision of  this Agreement
  is  invalid, illegal or incapable of being enforced under any rule of law, 
  all other conditions  and provisions of this  Agreement shall nevertheless
  remain in full force and effect so long as the economic or legal substance
  of  the transactions contemplated  hereby is not affected  in a materially
  adverse manner with respect to either party.

      8.8   Survival.      The   warranties,   representations,    covenants,
  agreements and  obligations  of the  parties under  this  Agreement  shall
  survive the Closing of the transaction contemplated hereby.

      8.9   Successors  and Assigns.   This  Agreement shall  be binding upon
  and shall inure to the  benefit of the parties hereto and their respective
  successors, assigns and legal representatives.

      8.10  Counterparts.  This Agreement  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.

      8.11  Attorneys'  Fees.  If a  suit or action is filed  by any party to
  enforce this Agreement, the prevailing party shall be entitled to  recover
  reasonable attorneys'  fees incurred in investigation  or related  matters
  and in preparation for  and prosecution or defense of such suit  or action
  as fixed by the trial court, and, if any appeal is taken from the decision
  of the trial court,  reasonable attorneys' fees as fixed by the  appellate
  court or, if appropriate, by the trial court.

      8.12  Indemnity.  WITH  RESPECT TO ANY  OBLIGATION OF  ANY PARTY  UNDER
  ANY  PROVISION  OF  THIS   AGREEMENT  TO  PROVIDE  INDEMNITY,  DEFEND  THE
  INDEMNITEE PARTY, AND PAY ATTORNEYS' FEES AND OTHER COSTS AND EXPENSES  OF
  LITIGATION  ASSOCIATED  WITH  THE  INDEMNITEE  PARTY'S  DEFENSE,   IF  THE
  INDEMNITOR PARTY IS HONORING ITS OBLIGATION TO DEFEND THE INDEMNITEE PARTY
  AND THE  INDEMNITEE PARTY  NEVERTHELESS ENGAGES  AN ATTORNEY TO  REPRESENT
  ITSELF AGAINST  SUCH CLAIM OR LAWSUIT,  THE INDEMNITOR PARTY  SHALL NOT BE
  RESPONSIBLE  FOR AND  SHALL NOT  PAY ATTORNEYS' FEES  AND OTHER  COSTS AND
  EXPENSES  OF  LITIGATION  INCURRED  BY  THE  INDEMNITEE  PARTY   THAT  ARE
  ATTRIBUTABLE  TO  THE  INDEMNITEE  PARTY'S  INDEPENDENT  AND   DUPLICATIVE
  DEFENSE.   IF ANY  INDEMNITEE  PARTY UNDER  ANY CIRCUMSTANCES  SETTLES  OR
  DISCHARGES  (OR DELEGATES THE RIGHT  TO SETTLE  OR DISCHARGE TO  ANY THIRD
  PARTY)  ANY CLAIM  OR  LAWSUIT  COVERED BY  ANY SUCH  INDEMNITY  PROVISION
  WITHOUT OBTAINING THE PRIOR WRITTEN CONSENT OF THE INDEMNITOR PARTY,  THEN
  THE INDEMNITOR PARTY'S OBLIGATION  TO DEFEND, INDEMNIFY AND HOLD  HARMLESS
  SUCH INDEMNITEE  PARTY FROM  SUCH  CLAIM OR  LAWSUIT SHALL  TERMINATE  AND
  INDEMNITOR  PARTY SHALL  HAVE NO OBLIGATION  TO FUND THE COST  OF ANY SUCH
  SETTLEMENT.   NOTWITHSTANDING  ANY PROVISION HEREOF  TO THE  CONTRARY, THE
  ASSUMPTION, INDEMNITY, DEFENSE  AND HOLD HARMLESS PROVISIONS SET  FORTH IN
  ANY  SUCH INDEMNITY  PROVISION SHALL  NOT APPLY  TO ANY AMOUNT  COVERED BY
  INSURANCE TO  THE EXTENT PAID  OR REIMBURSED TO THE  INDEMNITEE PARTY (WHO
  SHALL  USE  REASONABLE  EFFORTS  TO  COLLECT SUCH  AMOUNTS)  AND  ANY SUCH
  INSURANCE COVERAGE SHALL PROVIDE FOR A  WAIVER OF SUBROGATION IN  FAVOR OF
  THE INDEMNITOR PARTY.

      8.13  NORM.  Buyer acknowledges that  it has been informed that oil and
  gas producing  formations  can  contain  naturally  occurring  radioactive
  material ( NORM ). Formation of scale or deposits can concentrate NORM  on
  equipment and in  sludges. The presence of NORM in  certain concentrations
  requires  that  certain  appropriate  health,  safety,  and  environmental
  precautions be taken.

      8.14  ASSIGNABILITY.  Notwithstanding the  provisions of the  Operating
  Agreement  described in  Article  5.2(e)  hereof, this  agreement  and the
  Assets  covered hereby  may not  be assigned,  sold,  conveyed, mortgaged,
  pledged, transferred  or  exchanged by  Buyer without  the  express  prior
  written  consent of  Seller.   Seller  may withhold  such consent  for any
  reason  which,   in  its   sole  discretion,   is  reasonable   under  the 
  circumstances.   Any such assignment, sale,  conveyance, mortgage, pledge,
  transfer or  exchange by Buyer  in the  absence of such  consent by Seller
  shall be void and without force or effect.

      8.15  CHANGE IN  CONTROL.  In  the event that,  at any time during  the
  term  of the Operating Agreement  or ten (10)  years from the  date of the
  execution hereof, whichever period is lesser, Buyer experiences  a "change
  in control of the  Company", as hereinafter defined, Seller shall have the
  right and option, but not the obligation, for a period  of sixty (60) days
  following receipt  of notice from Buyer  that a change  in control  of the
  Company has occurred, to acquire all of Buyer's right, title  and interest
  in and  to the  Assets and  any additional interests which  may have  been
  acquired pursuant to the  Operating Agreement described in Article  5.2(e)
  hereof.   Any  such  acquisition by  Seller  pursuant  to  the  terms  and
  provisions  hereof shall  be made  free and  clear of  any and  all liens,
  mortgages, claims,  overriding royalty  interests, production payments  or
  any other burdens which may  have been created by, through or under Buyer,
  and such acquisition shall be made for a consideration equal to and not to
  exceed the actual out-of-pocket expenditures made by Buyer with respect to
  the  Assets and  other  interests  to be  acquired hereunder,  which  were
  incurred  and paid  by Buyer from  the date of the  acquisition thereof by
  Buyer to the date of the acquisition thereof by Seller.   For the purposes
  of this provision, "Company" shall  be deemed to mean Buyer and the parent
  of Buyer  and/or any  other entity  controlling a  majority of  the voting
  stock of Buyer.  For the purposes of this provision, a "change  in control
  of the Company" shall mean  a change in control of a nature that  would be
  required to be reported in response to Item 1(a)  of the Current Report on
  Form 8-K, as in effect on the date hereof, pursuant to Section 13 or 15(d)
  of the  Securities Exchange Act  of 1934,  as amended ("Exchange Act")  or
  would have  been required  to be so reported  but for  the fact that  such
  event had been "previously reported" as that term is defined in Rule 12b-2
  of Regulation 12B of the Exchange Act;  provided that, without limitation,
  such  a change  in control  shall be  deemed to have  occurred if  (a) any
  Person is or becomes the beneficial owner (as defined  in Rule 13d-3 under
  the  Exchange Act), directly  or indirectly, of securities  of the Company
  representing 40% or  more of  the combined voting  power of  the Company's
  then  outstanding securities ordinarily (apart from  rights accruing under
  special circumstances) having the right to vote at elections of  directors
  ("Voting Securities"), or (b) individuals who constitute the Board on  the
  Effective  Date hereof  (the "Incumbent  Board") cease  for any  reason to
  constitute at least a majority thereof, provided that any person  becoming
  a director subsequent to the date hereof whose election, or nomination for
  election by the Company's shareholders, was approved by a vote of at least
  three-quarters  of the directors comprising the Incumbent Board (either by
  specific vote  or by  approval of  the proxy statement of  the Company  in
  which such person is named as a nominee for director, without objection to
  such nomination) shall be, for  purposes of this clause (b), considered as
  though  such  person were  a  member  of  the Incumbent  Board,  or (c)  a
  recapitalization of the Company occurs which results in either a  decrease
  by 33% or more in the aggregate percentage ownership of Voting  Securities
  held by Independent Shareholders (on a primary basis or on a fully diluted
  basis after giving effect to the exercise of stock option and warrants) or
  an  increase in  the aggregate  percentage ownership of  Voting Securities
  held by  non-Independent Shareholders (on a  primary basis  or on a  fully
  diluted basis  after giving  effect to the exercise  of stock  options and
  warrants) to greater  than 50%.  For purposes  of this provision, the term
  "Person" shall mean and include any individual,  corporation, partnership,
  group, association or  other "person,"  as such  term is  used in  Section
  14(d) of  the Exchange Act,  other than  the Company, a  subsidiary of the
  Company or  any employee  benefit plan(s) sponsored or  maintained by  the
  Company  or an subsidiary thereof, and  the term "Independent Shareholder"
  shall  mean any  shareholder  of  the Company  except any  employee(s)  or
  director(s)  of the Company  or any employee benefit  plan(s) sponsored or 
  maintained by the Company or any subsidiary thereof.  For purposes of this
  Article  8.15, a "change in control of the Company" shall not be deemed to
  occur solely  as the  result of  a spin-off or other  distribution of  the
  outstanding stock of the Buyer (or assignee or transferee  of the Buyer to
  which  Seller  has  consented   under  the  provisions  of  Article  8.14,
  hereinafter a "permitted assignee")  to the  stockholders of the  ultimate
  parent corporation  controlling a majority of the voting stock of Buyer or
  any permitted assignee. 

      Seller and Buyer  acknowledge that this option is granted in connection
  with  the  obligations  set  forth  in this  Agreement  and  the Operating
  Agreement, and do hereby agree that this option shall be irrevocable until
  the earlier of  (i) ten (10) years from the  date of the execution hereof;
  or (ii)  the termination  date  of the  Operating Agreement,  as  provided
  therein.   Buyer and  Seller shall execute an  Option Agreement evidencing
  this arrangement, in the form of Exhibit 5.2(g), attached  hereto and made
  a part hereof for all purposes, which may be filed of record.


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

                                      SELLER:

                                      ENSERCH EXPLORATION, INC.


  _______________________________     By:________________________________
     James K. Teringo, Jr.                R. L. Kincheloe
                                          Senior Vice President,
                                          Offshore and International
  ________________________________


                                       BUYER:

  WITNESSES:
                                       READING & BATES DEVELOPMENT CO.


  ________________________________     By:__________________________________
  Name:___________________________     Name:   D. C. Toalson
                                       Title:  President

  ________________________________
  Name:___________________________

-----------------------------------------------------------------------------

  STATE OF TEXAS

  COUNTY OF DALLAS

      BEFORE ME, the  undersigned authority, duly commissioned  and qualified
  within  and  for  the  State  and County  aforesaid,  personally  came and
  appeared: 

      R. L. KINCHELOE, to me personally known to be the person whose name  is
  subscribed to the foregoing instrument,  who declared and acknowledged  to
  me, notary, in  the presence of the undersigned competent  witnesses, that
  he executed the above and foregoing  instrument in his capacity  as Senior
  Vice President, Offshore and International of Enserch Exploration, Inc., a
  Texas corporation, on behalf of said corporation with full authority,  and
  that the said instrument is the free act and deed of the said corporation,
  and was executed for the uses, purposes and benefits therein expressed.

      THUS DONE, READ  AND SIGNED in the  State and County aforesaid,  in the
  presence  of  James  K.  Teringo,  Jr.  and  ____________________________,
  competent witnesses, on the 18th day of October, 1995.

  WITNESSES:


  ______________________________   ___________________________________
  James K. Teringo, Jr.            R. L. KINCHELOE


  ______________________________



                     _____________________________________
                     Notary Public in and for the
                     State of Texas

  My Commission expires:

  ____________________________




  STATE OF TEXAS

  COUNTY OF DALLAS


      BEFORE ME, the  undersigned authority, duly commissioned  and qualified
  within  and  for  the  State  and County  aforesaid,  personally  came and
  appeared:

      D. C.  TOALSON, to me personally  known to be the  person whose name is
  subscribed to the  foregoing instrument, who declared  and acknowledged to
  me, notary, in  the presence of the undersigned competent  witnesses, that
  he  executed  the  above  and foregoing  instrument  in  his  capacity  as
  President of Reading  & Bates Development Co., a Delaware  corporation, on
  behalf of  the said  corporation with  full authority, and  that the  said
  instrument  is the  free act  and deed  of the  said corporation,  and was
  executed for the uses, purposes and benefits therein expressed.

      THUS DONE, READ  AND SIGNED in the  State and County aforesaid,  in the
  presence         of         _________________________________          and
  _________________________________, competent witnesses, on the 18th day of
  October, 1995.


  WITNESSES: 
  ___________________________________  ____________________________________
                                       D. C. TOALSON

  ___________________________________



                        ____________________________________
                        Notary Public in and for the
                        State of Texas

  My Commission expires:

  __________________________________ 


                            EXHIBIT 1.1

                             PART (a)
                        LEASEHOLD INTERESTS

  1. LEASE  OCS-G 8504.    That certain  Oil  and Gas  Lease  of
     Submerged Lands under the Outer Continental Shelf Lands Act
     made and effective as  of June 1, 1986, by  and between the
     United  States  of  America,  as  Lessor,  and  Placid  Oil
     Company, et al.,  as Lessees, bearing Serial No. OCS-G 8504
     covering  all  of Block  209,  Green  Canyon, OCS  Official
     Protraction Diagram, NG 15-3.

             Working Interest                       13.333333%
             Net Revenue Interest                   11.616868%

  2. LEASE OCS-G  7049.   That certain  Oil and  Gas Lease  of
     Submerged  Lands under the Outer  Continental Shelf Lands
     Act  made  and effective  as  of  June  1,  1984, by  and
     between  the United  States  of  America, as  Lessor, and
     Placid  Oil Company, et  al., as  Lessees, bearing Serial
     No. OCS-G 7049  covering all of Block 254, Green  Canyon,
     OCS Official Protraction Diagram, NG 15-3.

             Working Interest                       20.000000%
             Net Revenue Interest                   17.3506665%

  3. LEASE OCS-G  8010.   That certain  Oil and  Gas Lease  of
     Submerged  Lands under the  Outer Continental Shelf Lands
     Act  made  and effective  as  of  July  1,  1985, by  and
     between  the United  States  of  America, as  Lessor, and
     Placid  Oil Company, et  al., as  Lessees, bearing Serial
     No.  OCS-G 8010 covering all of Block  298, Green Canyon,
     OCS Official Protraction Diagram, NG 15-3.
  
             Working Interest                       20.00000%
             Net Revenue Interest                   17.35066%

  4. LEASE OCS-G  8012.   That certain  Oil and  Gas Lease  of
     Submerged Lands under the  Outer Continental Shelf  Lands
     Act  made  and effective  as  of  July  1,  1985, by  and
     between  the United  States  of  America, as  Lessor, and
     Placid  Oil Company, et  al., as  Lessees, bearing Serial
     No. OCS-G 8012 covering all of  Block 342, Green  Canyon,
     OCS Official Protraction Diagram, NG 15-3.

             Working Interest                       20.00000%
             Net Revenue Interest                   17.35066%

  5. LEASE OCS-G  8876.   That certain  Oil and  Gas Lease  of
     Submerged  Lands under the Outer  Continental Shelf Lands
     Act  made  and effective  as  of  June  1,  1987, by  and
     between the United States of America, as  Lessor, to Hunt
     Petroleum Corporation et  al., as Lessees, bearing Serial
     No. OCS-G  8876 covering all  of Block 297, Green Canyon,
     OCS Official Protraction Diagram, NG 15-3.

             Working Interest                       20.000000%
             Net Revenue Interest                   16.833333%

  6. LEASE  OCS-G 13171.   That certain  Oil and  Gas Lease of
     Submerged Lands under the  Outer Continental Shelf  Lands
     Act made and  effective as of May 1, 1991, by and between
     the  United  States  of  America,  as  Lessor,  to  Exxon
     Corporation, as  Lessee, bearing  Serial No. OCS-G  13171
     covering all  of Block  341, Green  Canyon, OCS  Official
     Protraction Diagram, NG 15-3.

             Working Interest                       20.000000%
             Net Revenue Interest                   17.500000%

  7. LEASE  OCS-G 13696.   That certain  Oil and  Gas Lease of
     Submerged Lands under  the Outer Continental  Shelf Lands
     Act  made  and effective  as  of  July  1,  1992, by  and
     between the  United  States  of  America, as  Lessor,  to
     Exxon  Corporation, as  Lessee, bearing Serial  No. OCS-G
     13696  covering  all  of  Block  210,  Green Canyon,  OCS
     Official Protraction Diagram, NG 15-3.

             Working Interest                       20.000000%
             Net Revenue Interest                   17.500000%

  8. LEASE OCS-G  8000.   That certain  Oil and  Gas Lease  of
     Submerged Lands under  the Outer Continental Shelf  Lands
     Act  made  and effective  as  of  July  1,  1985, by  and
     between  the United  States  of  America, as  Lessor, and
     Placid  Oil Company, et  al., as  Lessees, bearing Serial
     No. OCS-G 8000 covering  all of Block  213, Green Canyon,
     OCS Official Protraction Diagram, NG 15-3.

             Working Interest                       20.00000%
             Net Revenue Interest                   17.35066%

  9. LEASE OCS-G  8006.   That certain  Oil and  Gas Lease  of
     Submerged Lands  under the Outer  Continental Shelf Lands
     Act  made  and effective  as  of  July  1,  1985, by  and
     between  the United  States  of  America, as  Lessor, and
     Placid  Oil Company, et  al., as  Lessees, bearing Serial
     No. OCS-G 8006  covering all of  Block 258, Green Canyon,
     OCS Official Protraction Diagram, NG 15-3.

             Working Interest                       20.00000%
             Net Revenue Interest                   17.35066%

 10. LEASE OCS-G  8005.   That certain  Oil and  Gas Lease  of
     Submerged Lands  under the Outer  Continental Shelf Lands
     Act  made  and effective  as  of  July  1,  1985, by  and
     between the  United  States  of  America, as  Lessor,  to
     Amerada Hess  et al., as Lessees, bearing Serial No. OCS-
     G  8005 covering  all  of  Block 253,  Green Canyon,  OCS
     Official Protraction Diagram, NG 15-3.

             Working Interest                       20.000000%
             Net Revenue Interest                   16.500000%


                             PART (b)
                             EQUIPMENT

  1. WELLS:
                                  WORKING       REVENUE
                                 INTEREST       INTEREST

     A.   OCS-G 7049 #3          20.00000%       17.350665%
     B.   OCS-G 7049 #4          20.00000%       17.350665%
     C.   OCS-G 7049 #4ST1       20.00000%       17.350665%
     D.   OCS-G 7049 #5          20.00000%       17.350665%

  2. TEMPLATE:

     That certain  three well drilling template  acquired, inter
     alia,  by Seller for use in connection with the drilling of
     the OCS-G 7049 #5 Well.

  NOTE:   All  references in  the Exhibit  1.1 made  to "Working
          Interest" and  "Revenue Interest," and  to the numbers
          set  forth  in  connection therewith,  are  for  title
          warranty purposes only.


                            EXHIBIT 3.7

       CONTRACTS, AGREEMENTS, COMMITMENTS AND OTHER MATTERS

  GREEN CANYON BLOCK 209:

  1. Offer Letter  dated April 17, 1995, executed by and between
     Enserch Exploration, Inc. and  Reading & Bates  Development
     Co., as such may have been amended.

  2. Partial   Lease   Interest   Acquisition  Agreement   dated
     effective September  22, 1988, as amended,  executed by and
     between  Exxon Corporation  and Opubco Resources,  Inc., et
     al.

  3. Offshore Operating Agreement  dated effective September 22,
     1988, executed by and between Exxon Corporation and  Placid
     Oil  Company, et  al., as  amended by  instrument effective
     November 21, 1989, covering and pertaining to Green  Canyon
     Block 209.

  4. Farmout  Agreement  dated  July  10,  1991  (including  all
     amendments  to that  agreement), between  Exxon Corporation
     and Hunt Petroleum Corporation covering Green Canyon Blocks
     209, 254, 297, 298 and 342.

  5. Bidding Agreement  dated  April  1,  1986,  (including  all
     amendments to that agreement) between Exxon Corporation and
     Amoco Production Company, et  al., covering and  pertaining
     to Green Canyon Block 209.

  6. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  7. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  8. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  9. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

  GREEN CANYON BLOCK 254:

  1. Offer Letter  dated April 17, 1995, executed by and between
     Enserch Exploration,  Inc. and Reading  & Bates Development
     Co., as such may have been amended.

  2. Farmout  Agreement  dated  July  10,  1991  (including  all
     amendments  to that  agreement), between  Exxon Corporation
     and Hunt Petroleum Corporation covering Green Canyon Blocks
     209, 254, 297, 298 and 342.

  3. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  4. Oil Gathering Agreement dated December 2, 1994, executed by
     and between  EP Operating Limited Partnership,  as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  5. Gas Gathering Agreement dated December 2, 1994, executed by
     and  between EP Operating  Limited Partnership, as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  6. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  7. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  8. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

  9. That  certain Exploration,  Drilling  and  Production  Unit
     Agreement dated  June 22,  1995,  executed by  and  between
     Enserch  Offshore,  Inc.  and  Enserch  Exploration,  Inc.,
     covering and pertaining  to Green Canyon  Blocks 253,  254,
     297 & 298.

  GREEN CANYON BLOCK 298:

  1. Offer Letter dated April 17, 1995, executed by and  between
     Enserch Exploration, Inc.  and Reading &  Bates Development
     Co., as such may have been amended.

  2. Farmout  Agreement  dated  July  10,  1991  (including  all
     amendments  to that  agreement), between  Exxon Corporation
     and Hunt Petroleum Corporation covering Green Canyon Blocks
     209, 254, 297, 298 and 342.

  3. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  4. Oil Gathering Agreement dated December 2, 1994, executed by
     and between  EP Operating Limited Partnership,  as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  5. Gas Gathering Agreement dated December 2, 1994, executed by
     and  between EP Operating  Limited Partnership, as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  6. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  7. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  8. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

  9. That  certain  Exploration,  Drilling and  Production  Unit
     Agreement dated  June 22,  1995,  executed by  and  between
     Enserch  Offshore,  Inc.  and  Enserch  Exploration,  Inc.,
     covering and pertaining  to Green Canyon  Blocks 253,  254,
     297 & 298.

  GREEN CANYON BLOCK 342:

  1. Offer Letter dated  April 17, 1995, executed by and between
     Enserch Exploration, Inc.  and Reading &  Bates Development
     Co., as such may have been amended.

  2. Farmout  Agreement  dated  July  10,  1991  (including  all
     amendments  to that  agreement), between  Exxon Corporation
     and Hunt Petroleum Corporation covering Green Canyon Blocks
     209, 254, 297, 298 and 342.

  3. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  4. Oil Gathering Agreement dated December 2, 1994, executed by
     and between  EP Operating Limited Partnership,  as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  5. Gas Gathering Agreement dated December 2, 1994, executed by
     and  between EP Operating  Limited Partnership, as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  6. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  7. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  8. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

  GREEN CANYON BLOCK 297:

  1. Offer Letter dated  April 17, 1995, executed by and between
     Enserch Exploration, Inc.  and Reading & Bates  Development
     Co., as such may have been amended.

  2. Farmout  Agreement  dated  July  10,  1991  (including  all
     amendments  to that  agreement), between  Exxon Corporation
     and Hunt Petroleum Corporation covering Green Canyon Blocks
     209, 254, 297, 298 and 342.

  3. Joint Bidding  Agreement dated  April 16, 1987,  (including
     all amendments  to  that agreement)  between  EP  Operating
     Company and  Hunt Petroleum  Corporation, et  al., covering
     and pertaining to Green Canyon Block 297.

  4. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  5. Oil Gathering Agreement dated December 2, 1994, executed by
     and between  EP Operating Limited Partnership,  as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  6. Gas Gathering Agreement dated December 2, 1994, executed by
     and  between EP Operating  Limited Partnership, as Producer
     and Manta Ray Gathering Systems Inc., as Gatherer.

  7. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  8. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  9. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

 10. That certain  Exploration,  Drilling  and  Production  Unit
     Agreement  dated  June  22,  1995, executed  by and between
     Enserch   Offshore,  Inc.  and  Enserch  Exploration, Inc.,
     covering  and  pertaining to  Green Canyon Blocks 253, 254,
     297 & 298.

  GREEN CANYON BLOCK 341:

  1. Offer Letter dated April 17, 1995, executed by and  between
     Enserch Exploration, Inc.  and Reading &  Bates Development
     Co., as such may have been amended.

  2. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  GREEN CANYON BLOCK 210:

  1. Offer Letter dated April 17,  1995, executed by and between
     Enserch Exploration,  Inc. and Reading &  Bates Development
     Co., as such may have been amended.

  2. Purchase and Sale Agreement dated March 28, 1995,  executed
     by  and between  Exxon Corporation,  as Seller  and Enserch
     Exploration, Inc., as Buyer.

  GREEN CANYON BLOCK 213:

  1. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  2. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  3. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

  GREEN CANYON BLOCK 258:

  1. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and HI Production Company, Inc., as Seller.

  2. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and Placid Oil Company, as Seller.

  3. Purchase  and  Sale  Agreement  dated  February  28,  1995,
     executed by and  between Enserch Offshore,  Inc., as  Buyer
     and OPUBCO Resources, Inc., as Seller.

  GREEN CANYON BLOCK 253:

  1. Assignment and  Conveyance dated effective  March 1,  1995,
     executed by  and between Shell  Offshore, Inc., et  al., as
     Assignor,  and  Enserch  Exploration,  Inc.,  as  Assignee,
     subject to letter agreement dated May 12, 1995.

  2. That  certain Exploration,  Drilling  and  Production  Unit
     Agreement dated  June 22,  1995,  executed by  and  between
     Enserch  Offshore,  Inc.  and  Enserch  Exploration,  Inc.,
     covering and pertaining  to Green Canyon  Blocks 253,  254,
     297 & 298.



                            EXHIBIT 3.9

                     ENVIRONMENTAL DISCLOSURES

  Incidents of Non-Compliance:

     1.   Blow  out Preventor  test  using  lower pressure  than
          required for the OCS-G 7049 #4 Well.

     2.   Blow  out Preventor  test did  not indicate  that each
          component  was  effectively holding  pressure  for the
          OCS-G 7049 #4 Well.

  Other:

     1.   OCS-G 7049 #3 Well

          -loss from the MV Hoss Fortune of 2 drums containing 2
          gallons each of engine oil and "rig-rite" BOP fluid

          -loss  from a  waste boat  while traveling  from Grand
          Isle base  to  the  Treasure  Stawinner  of  a  pallet
          containing miscellaneous items from National Oilwell.

          -loss of anchor  shackle, and some  chain which  broke
          from  chain while  demooring the rig  and left  on the
          bottom (below mudline) at 3300 feet.


  ALL OF THE ABOVE WERE REPORTED TO THE MMS.



                          EXHIBIT 5.2(a)

                  TO PURCHASE AND SALE AGREEMENT
                   FORM OF CONVEYANCE INSTRUMENT


  STATE OF TEXAS

  COUNTY OF DALLAS

                    ASSIGNMENT AND BILL OF SALE

        THIS  Assignment and Bill  of Sale  (the "Assignment") is
  entered  into and shall be effective  as of 12:01 a.m., May 1,
  1995 (hereinafter referred to as the "Effective Date"), by and
  between  ENSERCH  EXPLORATION,   INC.,  a  Texas  corporation,
  (hereinafter referred to as "Assignor"), whose mailing address
  is 4849  Greenville Avenue, Suite 1500,  Dallas, Texas, 75206;
  and READING &  BATES DEVELOPMENT CO.,  a Delaware  corporation
  (hereinafter referred to as "Assignee"), whose mailing address
  is 901 Threadneedle, Suite 200, Houston, Texas  77079.

                       W I T N E S S E T H:

      1.  Sale.  THAT, FOR THE CONSIDERATION stated  hereinbelow
  in   Article  5.   and  OTHER   VALUABLE  CONSIDERATION,   the
  sufficiency of  which is  hereby  acknowledged, Assignor  does
  hereby GRANT, SELL, TRANSFER, ASSIGN, and CONVEY unto Assignee
  the undivided right, title and interest reflected in Exhibit 1
  Part  (a) hereof, in and  to the following described interests
  and   properties  (the   undivided  interest   being  assigned
  hereunder in  such interests and  properties shall hereinafter
  be referred  to collectively as the "Assets"  and the specific
  quantitative interest  being assigned hereunder  represents an
  undivided twenty percent (20%) of  the interest of Assignor in
  the Assets):

        a.   The oil, gas and  mineral lease described on Exhibit
             1,  Part (a)  (the   Lease ),  together with  a like
             interest with  respect to  the Lease in  and to  any
             and all  (i) mineral  interests, (ii)  overriding or
             landowners'  royalty  interests, (iii)  surface  and
             subsurface interests  and rights, (iv)   beneficial,
             convertible  or reversionary interests, (v) interest
             owned, claimed or acquired,  or to be owned, claimed
             or   acquired,   by   agreement,   (vi)   production
             payments,   (vii)   contractual   interests    owned
             pursuant  to  participation  agreements,   operating
             agreements  or similar  agreements, and  (viii)  any
             and all like or unlike  interests, including without
             limitation   those  specific   items  identified  on
             Exhibit  1,  Part  (a).    This  shall  include  any
             contractual rights  providing for the acquisition or
             earning  of any  of  the foregoing,  and  Assignor's
             rights in  respect of  any  pooled, communitized  or
             unitized acreage of which any  of the foregoing is a
             part.  SAVE AND EXCEPT ANY RIGHT,  TITLE OR INTEREST
             OF ASSIGNOR IN  AND TO, OR ANY RIGHTS DERIVED  FROM,
             ANY  BIDDING  AGREEMENTS  EXECUTED  BY  AND  BETWEEN
             ASSIGNOR  AND  MOBIL  OIL  EXPLORATION  &  PRODUCING
             SOUTHWEST  INC..   (All  of  the foregoing  shall be
             called collectively the  Leasehold Interests. )

        b.   Any  and  all  wells,   wellbores,  pipe,  gathering
             lines,    compressors,    facilities,     equipment,
             platforms,   pipelines   and   any  and   all  other
             personal,  real,  movable  and  immovable  property,
             fixtures or equipment which  are located on  or used
             directly   in   connection  with   the   production,
             treatment or transportation of  oil and gas from the
             Leasehold Interests, including, without  limitation,
             those items  specifically identified  on Exhibit  1,
             Part (b) (the  Equipment ).

        c.   Any    and   all   easements,   rights of way,   and
             subsurface and surface rights associated  or used in
             connection    with    any    such    easements    or
             rights of way,  which easements,  rights-of-way  and
             subsurface  and surface  rights  have  been obtained
             for use in  connection with the Leasehold  Interests
             (the  Gathering Facilities ).

        d.   Any and  all oil,  gas and  other minerals  produced
             from or  attributable to the  Leasehold Interests on
             or after the Effective Date.

        e.   To   the  extent   the   same  are   assignable   or
             transferable by Assignor and  to the extent and only
             to the extent  that the same relate to the ownership
             or  operation   of  the   Leasehold  Interests,  the
             Gathering Facilities  or the  Equipment on or  after
             the Effective  Date, a like interest  in and to  all
             orders,  contracts,  agreements  (including  without
             limitation all operating agreements,  transportation
             agreements,    unit    agreements,     participation
             agreements and processing agreements),  instruments,
             licenses, authorizations,  permits, audits,  claims,
             liens,  suits, settlements  and demands,  and  other
             rights,  privileges,  benefits and  powers conferred
             upon Assignor, including,  but not limited  to those
             listed on Exhibit 1 part (c).

  TO  HAVE  AND TO  HOLD unto  Assignee,  subject to  the terms,
  conditions and reservations hereinbelow recounted.

     2.   Title Warranty.  Assignor warrants that:

        a.   Except  as specifically  set forth  in the  Purchase
             and Sale  Agreement described  in Article  10. below
             or  under  the contracts  and  agreements listed  in
             Exhibit 1 to this  Assignment, and further except as
             a  consequence of the  formation of  a unit, neither
             Assignor nor any parent, subsidiary or affiliate  of
             Assignor   during   their  respective   periods   of
             ownership  has (A)  executed  any  deed, conveyance,
             assignment  or  other  instrument  as  an  assignor,
             grantor,  sublessor  or in  another capacity  or (B)
             has  breached any  obligation under  any  Lease that
             would (i)  result  in Assignee's  being entitled  to
             receive less than the  net revenue interest  for any
             Lease, well  or unit set forth  in Exhibit  1 of all
             oil  and gas  in, under,  and that may  be produced,
             saved  and  marketed from  or  attributable  to such
             Lease,  well or unit,  or (ii)  obligate Assignee to
             bear  the  costs   and  expenses  relating  to   the
             maintenance,   development  and  operation  of  such
             Lease, well  or unit  in an amount greater  than the
             working  interest for such  Lease, well  or unit set
             forth in Exhibit 1,  unless the net revenue interest
             attributable to  said working  interest is increased
             by a proportionate or greater amount; and

        b.   Except  as specifically  set  forth in  the Purchase
             and Sale  Agreement described in  Article 10.  below
             or  under the  contracts  and  agreements listed  in
             Exhibit  1 to this  Assignment, the  Assets are free
             of all liens, security interests and encumbrances;

  (the limited warranty  set forth in subparagraphs  (a) and (b)
  above shall hereinafter be referred to as the  Special Limited
  Warranty ).  Assignor shall convey the Assets with no warranty
  whatsoever other  than the Special Limited  Warranty, but with
  full substitution and  subrogation to Assignee  in and to  all
  covenants, agreements, representations  and warranties made by
  others heretofore given or made in connection  with the Assets
  or any part thereof.


     3.   Acceptance.   Assignee  accepts  this  Assignment  and
  acknowledges   delivery   of  the   Assets  and   accepts  the
  obligations  as provided  in the  Purchase and  Sale Agreement
  described in  Article 10 below (including  those contracts and
  agreements listed on Exhibit 1 of this Assignment, insofar and
  only insofar  as such contracts and  agreements cover, pertain
  or  apply  to  the  Leasehold  Interests),  on  or  after  the
  Effective Date, including, but not limited to, any  overriding
  royalty interests which  may burden the Assets  and which were
  created by Assignor's predecessor(s) in title.


     4.   Other Warranty Provisions.  Assignee acknowledges that
  (a) Assignor  has not  made  any warranty  or  representation,
  whether  express,  implied,  at  common  law,  by  statute  or
  otherwise, relating to the fitness for an intended purpose  or
  condition of any  movable property constituting  a portion  of
  the Assets  and  (b)  Assignee  shall  acquire  such  personal
  property in   WHERE IS, AS  IS  condition.   Except as  may be
  specifically set  forth to the  contrary in  the Purchase  and
  Sale Agreement  described in 10 below(the  "Agreement"), Buyer
  acknowledges  that  Seller  has  made  no  representations  or
  warranties  whatever,  expressed  or implied,  (Seller  having
  hereby  expressly disclaimed  all such  warranties) as  to the
  accuracy,   completeness,  or   materiality   of   any   data,
  information, record or materials now, heretofore, or hereafter
  made available  in connection with  this Agreement (including,
  without limitation, any  descriptions of oil  and gas  leases;
  quality  or quantity  or hydrocarbon reserves  attributable to
  the  Assets,  if   any;  production   rates,  exploratory   or
  development drilling opportunities,  decline rates,  potential
  for  production   of   hydrocarbons  from   the  Assets;   the
  environmental condition  of said  Assets;  the legal,  tax  or
  other consequences of owning Seller's interest in the  Assets;
  or any  other information contained in  any material furnished
  in  connection with this transaction).  Any and all such data,
  information, records or materials furnished by Seller to Buyer
  is  provided as a convenience only  and any reliance on or use
  of  same is at  the Buyer's sole  risk.  WITHOUT  LIMITING THE
  GENERALITY OF THIS PARAGRAPH, SELLER DISCLAIMS AND NEGATES  AS
  TO   ANY   PERSONAL  PROPERTY,   FIXTURES,   IMPROVEMENTS  AND
  APPURTENANCES SUBJECT TO THIS AGREEMENT (INCLUDING ALL WELLS):
  (A) ANY IMPLIED  OR EXPRESS WARRANTY  OF MERCHANTABILITY,  (B)
  ANY IMPLIED OR  EXPRESS WARRANTY OF  FITNESS FOR A  PARTICULAR
  PURPOSE, AND (C) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY
  TO MODELS  OR SAMPLE  OR MATERIALS.   THE PURCHASER  EXPRESSLY
  AGREES  THAT  TITLE  TO   SUCH  PERSONAL  PROPERTY,  FIXTURES,
  IMPROVEMENTS AND  APPURTENANCES  WILL  BE  ACCEPTED  "AS  IS",
  "WHERE  IS", "WITH ALL  FAULTS", AND IN  ITS PRESENT CONDITION
  AND STATE OF REPAIR.

     5.   Consideration.  The consideration for  this Assignment
  and  the nine  other Assignments  and Bills  of Sale  this day
  entered into by  and between Assignor  and Assignee  conveying
  certain  interests  in OCS-G  8504,  7049,  8010, 8012,  8876,
  13171,  13696, 8000,  8006 and  8005, is  the sum  of Eighteen
  Million Two Hundred Fifty Thousand and No/100 ($18,250,000.00)
  Dollars ("Purchase Price"), in part payment  thereof, Assignee
  has paid, in ready  and current funds, the sum of  Six Million
  Two Hundred Fifty Thousand and NO/100 ($6,250,000.00)  Dollars
  to the  Assignor, who hereby acknowledges  the receipt thereof
  and grants full acquittance and discharge therefor.

     And,  for the  balance of  the Purchase  Price, the  sum of
  Twelve   Million  and  No/100  ($12,000,000.00)  Dollars,  the
  Assignee has furnished one (1)  certain Promissory Note in the
  amount of Twelve Million and No/100 Dollars  ($12,000,000.00),
  drawn by the Assignee to the order of Assignor, dated the 18th
  day of October, 1995,  and payable in two installments  of Six
  Million and No/100 ($6,000,000.00) Dollars each, the first due
  on March  31, 1996 and  the second due on  September 30, 1996,
  which note bears interest at the rate of 8.56% per annum  from
  date thereof until paid.

     6.   Liability  of  Successors.    The  terms,  conditions,
  rights and obligations of this  Assignment shall run with  the
  land and extend to and be binding upon the parties  hereto and
  their respective successors, heirs and/or assigns.

     7.   Counterparts.   This  Assignment  may  be executed  in
  several  original counterparts,  all  of which  are identical.
  Each  of such counterparts shall for all purposes be deemed to
  be  an  original, and  all  such  counterparts shall  together
  constitute but  one and  the  same instrument.  The  signature
  pages of the counterparts may be amalgamated  to form complete
  documents for  the purpose of recording  complete documents in
  the public registries.

     8.   Severability.  If any provision of this Assignment  is
  invalid   or  unenforceable  in  part  or   in  whole  in  any
  jurisdiction  applicable  to  this  Assignment, then,  to  the
  extent permitted  by applicable law, (i)  the other provisions
  hereof  shall  remain  in  full   force  and  effect  in  such
  jurisdiction and  shall be  liberally  construed in  order  to
  carry  out the intentions of  the parties hereto  as nearly as
  may be  possible, and (ii) the  invalidity or unenforceability
  of such  provision in any  jurisdiction shall  not affect  the
  validity or enforceability thereof in any  other jurisdiction.


     9.   Governing Law.   THIS ASSIGNMENT SHALL  BE GOVERNED BY
  AND INTERPRETED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE
  STATE OF  LOUISIANA, WITHOUT REGARD  TO CONFLICT OF  LAW RULES
  THAT  WOULD   DIRECT  APPLICATION  OF  THE   LAWS  OF  ANOTHER
  JURISDICTION.

     10.  Purchase and Sale Agreement.  Notwithstanding anything
  to the contrary  provided herein, this Assignment shall at all
  times  be  subject to  the  terms,  conditions and  exceptions
  contained  in  that  certain  unrecorded   Purchase  and  Sale
  Agreement  dated the  same  date  as  this Assignment  by  and
  between Assignor and  Assignee.  The  unrecorded Purchase  and
  Sale Agreement shall  at all  times govern the  rights of  the
  parties  in and  to the  Assets.   All interested  parties are
  hereby  given  notice  of  the  existence  of  the  unrecorded
  Purchase and Sale Agreement.

     11.  MMS  Approval.   This  Assignment  is  expressly  made
  subject to the  approval of the  Minerals Management  Service,
  United States Department of the Interior.

        IN  WITNESS WHEREFORE,  this  Assignment is  executed  in
  multiple originals  and in  the  presence of  the  undersigned
  witnesses  on  this  18th day  of  October,  1995,  but to  be
  effective as of the Effective Date.


  WITNESSES:                                 ASSIGNOR:

                                          ENSERCH EXPLORATION, INC.
  ___________________________________     Tax ID # 75-2556975
  Name:  James K. Teringo, Jr.

                                          By:______________________ 
                                              R. L. Kincheloe
  Name:                                       Senior Vice President,
                                              Offshore and International

                                           ASSIGNEE:
  WITNESSES:
                                           READING & BATES DEVELOPMENT CO.
                                           Tax ID# 73-0797067

  Name:_________________________________
                                            _________________________ 
                                            By: D. C. Toalson            
  Name:__________________________________       President





  STATE OF TEXAS

  COUNTY OF DALLAS

     BEFORE ME, the undersigned authority, duly commissioned and
  qualified  within  and for  the  State  and County  aforesaid,
  personally came and appeared:

     R.  L. KINCHELOE, to me  personally known to  be the person
  whose name  is subscribed  to  the foregoing  instrument,  who
  declared  and acknowledged to  me, notary, in  the presence of
  the  undersigned competent  witnesses,  that  he executed  the
  above and foregoing instrument in  his capacity as Senior Vice
  President, Offshore and International of  Enserch Exploration,
  Inc., a Texas corporation, on behalf of said corporation  with
  full authority, and that  the said instrument is the  free act
  and deed of  the said  corporation, and was  executed for  the
  uses, purposes and benefits therein expressed.

     THUS  DONE,  READ  AND  SIGNED  in  the  State  and  County
  aforesaid, in  the  presence  of James  K.  Teringo,  Jr.  and
  ________________________, competent witnesses, on the 18th day
  of October, 1995.

  WITNESSES:


  ______________________________    ________________________________
  James K. Teringo, Jr.             R. L. KINCHELOE

  ______________________________



                  _____________________________________
                  Notary Public in and for the
                  State of Texas

  My Commission expires:

  ____________________________





  STATE OF TEXAS

  COUNTY OF DALLAS

     BEFORE ME, the undersigned authority, duly commissioned and
  qualified  within  and for  the  State  and County  aforesaid,
  personally came and appeared:

     D.  C. TOALSON,  to me  personally known  to be  the person
  whose name  is subscribed  to  the foregoing  instrument,  who
  declared  and acknowledged to  me, notary, in  the presence of
  the  undersigned competent  witnesses,  that  he executed  the
  above and foregoing instrument in his capacity as President of
  Reading & Bates  Development Co., a  Delaware corporation,  on
  behalf of  the said corporation with full  authority, and that
  the  said instrument  is the  free act  and  deed of  the said
  corporation,  and  was executed  for  the  uses, purposes  and
  benefits therein expressed.

     THUS  DONE,  READ  AND  SIGNED  in  the  State  and  County
  a f o r e s a i d ,    i n     t h e    p r e s e n c e    o f
  _________________________________                          and
  _________________________________, competent witnesses, on the
  18th day of October, 1995.

  WITNESSES:


  ___________________________________  ____________________________________
                                       D. C. TOALSON

  ___________________________________



                    ____________________________________
                    Notary Public in and for the
                    State of Texas

  My Commission expires:

  __________________________________



                             EXHIBIT 1

                             Part (a)

       [DESCRIBE LEASE AND INTEREST BEING ASSIGNED THEREIN]



                             Part (b)

     Together with a like interest in and to:

                  [DESCRIBE WELLS AND EQUIPMENT]


                             Part (c)

     Together with a like interest in and to:

                [DESCRIBE CONTRACTS AND AGREEMENTS]



  NOTE:    ALL REFERENCES  IN THIS  EXHIBIT  1 MADE  TO "WORKING
  INTEREST" AND "NET REVENUE  INTEREST", AND TO THE NUMBERS  SET
  FORTH IN CONNECTION THEREWITH, ARE FOR TITLE WARRANTY PURPOSES
  ONLY.



                          EXHIBIT 5.2(c)
                  TO PURCHASE AND SALE AGREEMENT

                         PAYMENT AGREEMENT

    (Filed seperately as Exhibit 10.123 to the Company's Annual
                  Report on Form 10-K for 1995.)


                          EXHIBIT 5.2(f)
                  TO PURCHASE AND SALE AGREEMENT

    AUTHORIZATION FOR EXPENDITURE FOR THE DRILLING OF THE OCS-G
  7049 #5 WELL


                          EXHIBIT 5.2(g)
                  TO PURCHASE AND SALE AGREEMENT

                         OPTION AGREEMENT

    (Filed seperately as Exhibit 10.126 to the Company's Annual
                  Report on Form 10-K for 1995.)