Exhibit 10.5

                                    EXHIBIT D
                            to Subscription Agreement
                            -------------------------

                          REGISTRATION RIGHTS AGREEMENT
                          -----------------------------

         AGREEMENT  dated as of November 18,  2004,  between  MERCATOR  MOMENTUM
FUND,  L.P.,  MERCATOR  MOMENTUM  FUND  III,  L.P,  MONARCH  POINTE  FUND,  LTD.
(collectively,  the "Funds") and MERCATOR ADVISORY GROUP, LLC ("MAG") (the Funds
and MAG are  referred to  individually  as a "Holder"  and  collectively  as the
"Holders"),  and  Tidelands Oil & Gas  Corporation,  a Nevada  corporation  (the
"Company").

         WHEREAS,  the Funds have  purchased,  for an aggregate  of  $5,000,000,
Convertible  Debentures (the "Debentures") from the Company,  and have the right
to cause their Debentures to be converted into shares of Common Stock, $.001 par
value (the "Common Stock"),  of the Company,  pursuant to the conversion formula
set forth in its Debenture;

         WHEREAS,  each  Fund  and MAG have  acquired  Warrants  (together,  the
"Warrants")  from the  Company,  pursuant to which the Holders have the right to
purchase in the aggregate up to 6,578,948 shares of the Common Stock through the
exercise of the Warrants;

         WHEREAS,  the Company desires to grant to the Holders the  registration
rights set forth herein with respect to the shares of Common Stock issuable upon
the conversion of the Debentures and the exercise of the Warrants.

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

         1.  Registrable  Securities.  As used  herein  the  terms  "Registrable
Security"  means  each of the  shares  of  Common  Stock  (i)  issued  upon  the
conversion of the Debentures (the "Conversion  Shares") or (ii) upon exercise of
the Warrants (the "Warrant Shares"), provided, however, that with respect to any
particular  Registrable Security,  such security shall cease to be a Registrable
Security when, as of the date of determination  that (a) it has been effectively
registered under the Securities Act of 1933, as amended (the "Securities  Act"),
and disposed of pursuant thereto,  or (b) registration  under the Securities Act
is no longer  required for the immediate  public  distribution of such security.
The term "Registrable Securities" means any and/or all of the securities falling
within the foregoing definition of a "Registrable Security." In the event of any
merger,  reorganization,  consolidation,  recapitalization  or other  change  in
corporate structure affecting the Common Stock, such adjustment shall be made in
the definition of  "Registrable  Security" as is appropriate in order to prevent
any dilution or enlargement of the rights granted pursuant to this Section 1.

         2. Registration.


                  (a) The  Company  shall  file a  registration  statement  (the
"Registration  Statement")  with the  Securities  and Exchange  Commission  (the
"SEC")  within  thirty  (30) days after the date of this  Agreement  in order to
register the resale of the Registrable Securities under the Securities Act. Once
effective,  the Company shall  maintain the  effectiveness  of the  Registration
Statement  until  the  earlier  of (i)  the  date  that  all of the  Registrable
Securities have been sold, or (ii) the date that the Company receives an opinion
of counsel to the Company that all of the  Registrable  Securities may be freely
traded without registration under the Securities Act, under Rule 144 promulgated
under the Securities Act or otherwise.



<PAGE>

                  (b) The Company  will  initially  include in the  Registration
Statement  as  Registrable  Securities  Seventeen  Million  Six  Hundred  Ninety
Thousand  Fifty-Nine  (17,690,059)  shares of Common  Stock,  being the  maximum
number of shares of Common Stock issuable by the Company upon  conversion of the
Debentures and exercise of the Warrants.

         3. Covenants of the Company with Respect to Registration.

         The Company covenants and agrees as follows:

                  (a)  The  Company   shall  use  best   efforts  to  cause  the
Registration  Statement to become effective with the SEC as promptly as possible
and in no event more than 90 days after the Registration Statement is filed with
the SEC. If any stop order shall be issued by the SEC in  connection  therewith,
the Company shall use best efforts to obtain promptly the removal of such order.
Following the effective date of the Registration  Statement,  the Company shall,
upon the  request of any Holder,  forthwith  supply  such  reasonable  number of
copies of the  Registration  Statement,  preliminary  prospectus  and prospectus
meeting  the  requirements  of the  Securities  Act,  and  any  other  documents
necessary or incidental to the public offering of the Registrable Securities, as
shall be  reasonably  requested  by the  Holder to permit  the  Holder to make a
public distribution of the Holder's Registrable  Securities.  The obligations of
the Company  hereunder with respect to the Holder's  Registrable  Securities are
subject to the Holder's  furnishing to the Company such appropriate  information
concerning the Holder, the Holder's Registrable  Securities and the terms of the
Holder's  offering of such Registrable  Securities as the Company may reasonably
request in writing.

                  (b) The  Company  shall pay all costs,  fees and  expenses  in
connection  with the  Registration  Statement filed pursuant to Section 2 hereof
including, without limitation, the Company's legal and accounting fees, printing
expenses,  and blue sky fees and expenses;  provided,  however, that each Holder
shall be solely  responsible for the fees of any counsel  retained by the Holder
in connection  with such  registration  and any transfer  taxes or  underwriting
discounts,  commissions or fees applicable to the Registrable Securities sold by
the Holder pursuant thereto.

                  (c) The Company will take all actions which may be required to
qualify or register  the  Registrable  Securities  included in the  Registration
Statement  for the offer and sale under the  securities or blue sky laws of such
states as are reasonably  requested by each Holder of such securities,  provided
that the Company  shall not be obligated to execute or file any general  consent
to service of process  or to  qualify as a foreign  corporation  to do  business
under the laws of any such jurisdiction.

         4. Additional Terms.

                  (a) The Company shall  indemnify and hold harmless the Holders
and each underwriter, within the meaning of the Securities Act, who may purchase
from or sell for any Holder,  any Registrable  Securities,  from and against any
and all losses,  claims,  damages and liabilities caused by any untrue statement
of  a  material  fact  contained  in  the  Registration  Statement,   any  other



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registration  statement  filed by the  Company  under  the  Securities  Act with
respect to the registration of the Registrable  Securities,  any  post-effective
amendment to such registration statements, or any prospectus included therein or
caused by any omission to state  therein a material  fact  required to be stated
therein or  necessary  to make the  statements  therein not  misleading,  except
insofar as such losses,  claims,  damages or liabilities  are caused by any such
untrue statement or omission based upon information  furnished or required to be
furnished in writing to the Company by the Holders or underwriter  expressly for
use therein,  which  indemnification  shall  include  each  person,  if any, who
controls any Holder or underwriter  within the meaning of the Securities Act and
each  officer,  director,  employee  and agent of each  Holder and  underwriter;
provided, however, that the indemnification in this Section 4(a) with respect to
any prospectus  shall not inure to the benefit of any Holder or underwriter  (or
to the benefit of any person  controlling  any Holder or underwriter) on account
of any  such  loss,  claim,  damage  or  liability  arising  from  the  sale  of
Registrable  Securities by the Holder or underwriter,  if a copy of a subsequent
prospectus   correcting  the  untrue  statement  or  omission  in  such  earlier
prospectus  was provided to such Holder or  underwriter  by the Company prior to
the subject sale and the subsequent  prospectus was not delivered or sent by the
Holder or underwriter to the purchaser prior to such sale and provided  further,
that the Company  shall not be obligated to so indemnify  any Holder or any such
underwriter  or other person  referred to above unless the Holder or underwriter
or other  person,  as the case may be,  shall  at the same  time  indemnify  the
Company, its directors, each officer signing the Registration Statement and each
person,  if any, who controls the Company  within the meaning of the  Securities
Act, from and against any and all losses, claims, damages and liabilities caused
by any  untrue  statement  of a  material  fact  contained  in the  Registration
Statement,  any registration statement or any prospectus required to be filed or
furnished by reason of this Agreement or caused by any omission to state therein
a  material  fact  required  to be  stated  therein  or  necessary  to make  the
statements therein not misleading,  insofar as such losses,  claims,  damages or
liabilities  are  caused  by  any  untrue   statement  or  omission  based  upon
information  furnished  in writing to the  Company by the Holder or  underwriter
expressly for use therein.

                  (b) If for any reason the indemnification  provided for in the
preceding section is held by a court of competent jurisdiction to be unavailable
to an indemnified  party with respect to any loss, claim,  damage,  liability or
expense  referred  to  therein,   then  the  indemnifying   party,  in  lieu  of
indemnifying such indemnified  party thereunder,  shall contribute to the amount
paid or payable by the indemnified party as a result of such loss, claim, damage
or liability in such  proportion as is appropriate to reflect the relative fault
of the  indemnified  party  and the  indemnifying  party,  as well as any  other
relevant equitable considerations.

                  (c)  Neither  the filing of a  Registration  Statement  by the
Company   pursuant  to  this  Agreement  nor  the  making  of  any  request  for
prospectuses  by the Holder shall impose upon any Holder any  obligation to sell
the Holder's Registrable Securities.

                  (d) Each Holder,  upon receipt of notice from the Company that
an  event  has  occurred  which  requires  a  Post-Effective  Amendment  to  the
Registration Statement or a supplement to the prospectus included therein, shall
promptly  discontinue  the  sale of  Registrable  Securities  until  the  Holder
receives a copy of a supplemented or amended prospectus from the Company,  which
the Company shall provide as soon as practicable after such notice.



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<PAGE>

                  (e) If the Company  fails to keep the  Registration  Statement
referred to above continuously  effective during the requisite period,  then the
Company  shall,  promptly  upon the request of any Holder,  use best  efforts to
update the Registration  Statement or file a new registration statement covering
the Registrable Securities remaining unsold, subject to the terms and provisions
hereof.

                  (f)  Each  Holder  agrees  to  provide  the  Company  with any
information or undertakings reasonably requested by the Company in order for the
Company to include  any  appropriate  information  concerning  the Holder in the
Registration  Statement or in order to promote  compliance by the Company or the
Holder with the Securities Act.

                  (g)  The  Company  agrees  that  it  shall  cause  each of its
directors,  officers and  shareholders  owning ten percent  (10%) or more of the
Company's  outstanding  Common  Stock to refrain  from selling any shares of the
Company's Common Stock, except under Rule 144, until the Registration  Statement
has been declared effective.

                  (h) Each  Holder,  on  behalf of  itself  and its  affiliates,
hereby  covenants  and agrees not to,  directly or  indirectly,  offer to "short
sell",  contract to "short sell" or otherwise "short sell" any securities of the
Company,  including,  without  limitation,  shares of Common  Stock that will be
received as a result of the  conversion of the Debentures or the exercise of the
Warrants.

         5.  Governing  Law.  The  Registrable  Securities  will be, if and when
issued,  delivered in California.  This  Agreement  shall be deemed to have been
made and  delivered  in the  State of  California  and shall be  governed  as to
validity, interpretation,  construction, effect and in all other respects by the
internal  substantive laws of the State of California,  without giving effect to
the choice of law rules thereof.

         6.  Amendment.  This  Agreement  may  only  be  amended  by  a  written
instrument executed by the Company and the Holders.

         7. Entire Agreement. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof, and supersedes all
prior  agreements  and  understandings  of the parties,  oral and written,  with
respect to the subject matter hereof.

         8. Execution in 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 document.

         9. Notices.  All notices,  requests,  demands and other  communications
hereunder  shall be in writing and shall be deemed duly given when  delivered by
hand or mailed by registered or certified mail, postage prepaid,  return receipt
requested, as follows:

                 If to the Holders,        Mercator Advisory Group, LLC
                                           Mercator Momentum Fund, L.P.
                                           Mercator Momentum Fund III, L.P.
                                           Monarch Pointe Fund, Ltd.
                                           555 South Flower Street, Suite 4500
                                           Los Angeles, CA  90071
                                           Attention: David Firestone



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<PAGE>

                 With a copy to            Sheppard Mullin Richter & Hampton LLP
                                           333 South Hope Street
                                           48th Floor
                                           Los Angeles, CA 90071-1448
                                           Telephone No.: (213) 620-1780
                                           Facsimile No.: (213) 620-1398
                                           Attention: David C. Ulich

                 If to the Company,        Tidelands Oil & Gas Corporation
                                           1862 West Bitters, Building #1
                                           San Antonio, Texas 78248
                                           Phone ____________
                                           Fax 210-764-2809
                                           Attention: _________________


                 With a copy to            Greg Wilson
                                           18610 East 32nd Ave.
                         Greenacres, Washington 99016
                                           Phone: 509-891-8373
                                           Fax: __________________



         10.  Binding  Effect;  Benefits.  Any  Holder  may  assign  its  rights
hereunder.  This  Agreement  shall inure to the benefit of, and be binding upon,
the parties hereto and their respective heirs, legal representatives, successors
and assigns. Nothing herein contained, express or implied, is intended to confer
upon any person other than the parties hereto and their respective heirs,  legal
representatives  and  successors,  any rights or remedies  under or by reason of
this Agreement.

         11. Headings. The headings contained herein are for the sole purpose of
convenience  of reference,  and shall not in any way limit or affect the meaning
or interpretation of any of the terms or provisions of this Agreement.

         12.  Severability.  Any provision of this Agreement  which is held by a
court  of  competent  jurisdiction  to be  prohibited  or  unenforceable  in any
jurisdiction(s) shall be, as to such jurisdiction(s),  ineffective to the extent
of such  prohibition  or  unenforceability  without  invalidating  the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.

         13.  Jurisdiction.  Each of the parties irrevocably agrees that any and
all suits or proceedings based on or arising under this Agreement may be brought
only in and shall be resolved in the federal or state courts located in the City
of Los Angeles,  California and consents to the  jurisdiction of such courts for



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such  purpose.  Each  of  the  parties  irrevocably  waives  the  defense  of an
inconvenient  forum to the  maintenance  of such suit or  proceeding in any such
court.  Each of the parties  further  agrees that  service of process  upon such
party  mailed by first class mail to the address set forth in Section 9 shall be
deemed in every respect effective service of process upon such party in any such
suit or  proceeding.  Nothing  herein  shall affect the right of either party to
serve process in any other manner  permitted by law. Each of the parties  agrees
that a final  non-appealable  judgment in any such suit or  proceeding  shall be
conclusive and may be enforced in other  jurisdictions  by suit on such judgment
or in any other lawful manner.

         14.  Attorneys'  Fees and  Disbursements.  If any  action  at law or in
equity is  necessary to enforce or interpret  the terms of this  Agreement,  the
prevailing party or parties shall be entitled to receive from the other party or
parties  reasonable  attorneys' fees and  disbursements in addition to any other
relief to which the prevailing party or parties may be entitled.

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         IN WITNESS  WHEREOF,  this Agreement has been executed and delivered by
the parties hereto as of the date first above written.


                                              TIDELANDS OIL & GAS CORPORATION



                                              By:_______________________________
                                              Name:_____________________________
                                              Its: President

                                              HOLDERS:

                                              MERCATOR MOMENTUM FUND, L.P.
                                              BY:  MERCATOR ADVISORY GROUP, LLC,
                                              GENERAL PARTNER


                                              By:_______________________________
                                              Name: David Firestone
                                              Its:  Managing Member

                                              MERCATOR MOMENTUM FUND III, L.P.
                                              BY MERCATOR ADVISORY GROUP, LLC
                                              GENERAL PARTNER


                                              By:_______________________________
                                              Name: David Firestone
                                              Its:  Managing Member


                                              MONARCH POINTE FUND, LTD.


                                              By:_______________________________
                                              Name: David Firestone
                                              Its:  President


                                              MERCATOR ADVISORY GROUP, LLC


                                              By:_______________________________
                                              Name: David Firestone
                                              Its:  Managing Member