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                                                                   EXHIBIT 10.4



                              ORYX ENERGY COMPANY




              EXECUTIVE VARIABLE INCENTIVE PLAN ("EXECUTIVE VIP")





                        Effective as of January 1, 1996
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                               TABLE OF CONTENTS


<TABLE>
<CAPTION>
ARTICLE         DESCRIPTION                                                PAGE
-------         -----------                                                ----
<S>             <C>                                                         <C>
Article I       Purpose of the Plan   . . . . . . . . . . . . . . . . . .    1
                                                                          
Article II      Definitions   . . . . . . . . . . . . . . . . . . . . . .    1
                                                                          
Article III     Eligibility   . . . . . . . . . . . . . . . . . . . . . .    4
                                                                          
Article IV      Administration of the Plan  . . . . . . . . . . . . . . .    5
                                                                          
Article V       Target Award Levels   . . . . . . . . . . . . . . . . . .    6
                                                                          
Article VI      Determination of Performance Goals                        
                and Amount of Awards  . . . . . . . . . . . . . . . . . .    6
                                                                          
Article VII     Form and Timing of Awards   . . . . . . . . . . . . . . .    8
                                                                          
Article VIII    Voluntary Election to Defer   . . . . . . . . . . . . . .    8
                                                                          
Article IX      Voluntary Election to Receive Restricted Stock  . . . . .    9
                                                                          
Article X       No Right of Employment  . . . . . . . . . . . . . . . . .   13
                                                                          
Article XI      Miscellaneous   . . . . . . . . . . . . . . . . . . . . .   14
</TABLE>                                                                  
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                                   Article I

                              Purpose of the Plan

The purpose of this Executive Variable Incentive Plan (hereinafter referred to
as the "Plan") for Oryx Energy Company is to provide incentive compensation
opportunities for certain executive employees of the Company and to provide
certain participants the option of taking all or a portion of their annual
incentive compensation awards in restricted common stock of the Company.  The
Plan seeks to reinforce three significant Company values:  teamwork, sharing
success, and the rewarding of individual performance.  It is also designed to
assist in the attraction, motivation, and retention of superior employees and
to link employees to the Company's strategic objectives and the interests of
stockholders.  Each year, Participants in the Plan will have the opportunity to
earn incentive compensation awards based upon the attainment of specific
Performance Goals established at the beginning of each Plan Year by the
Compensation Committee of the Board of Directors.

                                   Article II

                                  Definitions

When used in the Plan, the following terms shall have the following meanings:

2.1      Base Salary means the annualized weekly base salary in effect as of
         the last pay period ending during the Plan Year as reflected in the
         personnel records of the Company.

2.2      Board of Directors means the Board of Directors of the Company.

2.3      Common Stock means the common stock, par value $1.00 per share, of the
         Company or any stock or other securities of the Company hereafter
         issued or issuable in substitution or exchange for the Common Stock.

2.4      Company means Oryx Energy Company.

2.5      Compensation Committee means the Compensation Committee of the Board
         of Directors, which will have the overall responsibility for
         administering the Plan.





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2.6      Corporate Change:  A "Corporate Change" shall be deemed to have
         occurred for the purposes of Article IX hereof upon (i) the
         dissolution or liquidation of the Company; (ii) a reorganization,
         merger, or consolidation of the Company with one or more corporations
         (other than a merger or consolidation effecting a reincorporation of
         the Company in another state or any other merger or consolidation in
         which the shareholders of the surviving corporation and their
         proportionate interests therein immediately after the merger or
         consolidation are substantially identical to the shareholders of the
         Company and their proportionate interests therein immediately prior to
         the merger or consolidation); (iii) the sale of all or substantially
         all of the assets of the Company; or (iv) the occurrence of a Change
         in Control.  A "Change in Control" shall be deemed to have occurred
         for purposes of Article IX hereof if (a) individuals who were
         directors of the Company immediately prior to a Control Transaction
         shall cease, within two years of such Control Transaction, to
         constitute a majority of the Board of Directors of the Company (or of
         the Board of Directors of any successor to the Company or to a company
         which has acquired all or substantially all of its assets) or (b) any
         entity, person, or Group acquires shares of the Company in a
         transaction or series of transactions that result in such entity,
         person, or Group directly or indirectly owning beneficially 50% or
         more of the outstanding shares of Common Stock of the Company.  As
         used herein, "Control Transaction" shall be (a) any tender offer for
         or acquisition of capital stock of the Company, (b) any merger or
         consolidation of the Company, (c) any contested election of directors
         of the Company, or (d) any combination of the foregoing, any one of
         which results in a change in voting power sufficient to elect a
         majority of the Board of Directors of the Company.  As used herein,
         "Group" shall mean persons who act "in concert" as described in
         Sections 13(d)(3) and/or 14(d)(2) of the Securities Exchange Act of
         1934, as amended.

2.7      Disability:  For purposes of Articles III and IX hereof, the
         "Disability" of a Participant shall be deemed to have occurred if, in
         the good faith judgment of the Compensation Committee, the Participant
         shall become unable to continue the proper performance of his or her
         duties as an employee of the Company or a subsidiary thereof on a
         full-time basis as a result of his or her physical or mental
         incapacity.

2.8      Executive Deferred Compensation Plan means the nonqualified deferred
         compensation plan of the Company in which certain executive employees
         of the Company may voluntarily elect to participate by deferring their
         cash awards earned pursuant to the Plan as set forth in Article VIII
         hereof.

2.9      Fair Market Value means the average of the reported high and low sales
         prices of the Common Stock (rounded up to the nearest one-eighth of a
         dollar) on the date Fair Market Value is to be determined (or if there
         was no reported sale on such date, the next preceding date on which
         any reported sale occurred) on the New York Stock Exchange (or, if the
         Common Stock is not then listed or admitted to trading on such





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         exchange, on the principal exchange or in such other principal market
         on which the Common Stock is then listed or admitted to trading).

2.10     Just Cause means willful misconduct or dishonesty by the Participant,
         conviction of the Participant for a felony or failure by the
         Participant to contest prosecution for a felony, or excessive
         absenteeism on the part of the Participant not related to illness.

2.11     Participant means any employee of the Company or any subsidiary
         thereof who is described as eligible to participate in the Plan as set
         forth in Article III hereof.

2.12     Performance Goals mean the performance goals established each year
         pursuant to the Plan upon which performance will be measured.

2.13     Plan means the Executive Variable Incentive Plan of Oryx Energy
         Company, effective as of January 1, 1996, as described herein.

2.14     Plan Year means the performance period of the Plan, commencing on
         January 1 and ending December 31 each year, commensurate with the
         Company's fiscal year.

2.15     Restricted Stock means Common Stock issued pursuant to, and with such
         restrictions as are imposed by, Article IX hereof.

2.16     Retirement:  For purposes of Articles III and IX hereof, the term
         "Retirement" shall mean a termination of employment with the Company
         or a subsidiary thereof by reason of retirement either (i) on a
         voluntary basis by a Participant who is at least 60 years of age or
         (ii) with the written consent of the Compensation Committee in its
         sole discretion (in the case of the retirement of the Chief Executive
         Officer of the Company) or with the written consent of the Chief
         Executive Officer of the Company in his sole discretion (in the case
         of the retirement of any other Participant).  The preceding provisions
         of this Section to the contrary notwithstanding, at any time prior to
         one year preceding the date on which a Participant attains age 60, a
         Participant may make a written irrevocable election to defer his or
         her voluntary retirement age set forth in clause (i) to age 61 or such
         later age the Participant may designate in such election.  In
         addition, any Participant who makes such an election may make a
         subsequent written irrevocable election to further defer his or her
         voluntary retirement age to any age at least one year older than the
         age previously designated provided that such election must be made at
         least one year prior to the attainment of the previously elected
         voluntary retirement age.





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2.17     Target means the level of performance that is judged to be acceptable
         or standard for which 100% of the award will be paid for attainment of
         that performance objective.

2.18     Target Award Level means the percentage of Base Salary that may be
         earned by each Participant based upon the attainment of the Target
         (100%) level of performance.

2.19     Threshold means the level of performance that is judged to be the
         minimum acceptable for which some percentage, less than 100%, of the
         award will be paid for attainment of that performance objective.

                                  Article III

                                  Eligibility

3.1      Subject to the provisions of this Article III, only those employees of
         the Company or a subsidiary thereof who are "officers" of the Company
         as defined in Rule 16a-1(f) promulgated by the Securities and Exchange
         Commission under Section 16 of the Securities Exchange Act of 1934, as
         amended, are eligible to participate in this Plan and only those so
         eligible who are designated by the Compensation Committee as
         "Participants" in the Plan for any Plan Year will participate in the
         Plan for such Plan Year.

3.2      An employee must be on the regular payroll (including approved annual
         vacation leave) as of December 31 of the Plan Year and have at least
         26 completed weeks of active service during the Plan Year in order to
         be eligible to receive an award pursuant to the Plan for such Plan
         Year.  Any employee who satisfies the criteria for receiving an award
         pursuant to the Plan for a Plan Year but who had fewer than 52
         completed weeks of active service during the Plan Year shall have his
         or her award pro-rated based on his or her number of completed weeks
         of active service during the Plan Year.  An employee whose employment
         terminates during the Plan Year for any reason other than those
         reasons set forth in Section 3.4 hereof is not eligible to receive an
         award pursuant to the Plan for such Plan Year.

3.3      Any provision of the Plan to the contrary notwithstanding: (i) for
         purposes of determining an employee's completed weeks of active
         service during a Plan Year under this Article III, any period of
         approved annual vacation leave, and any period of a leave of absence
         (whether paid or unpaid) to which the employee is entitled pursuant to
         the Family and Medical Leave Act, shall be included as active service
         for such Plan Year; (ii) for purposes of determining whether an
         employee is on the regular payroll as of December 31 of a Plan Year
         under this Article III, an employee





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         on a leave of absence as of December 31 of a Plan Year (whether paid
         or unpaid) to which the employee is entitled pursuant to the Family
         and Medical Leave Act shall be deemed to be on the regular payroll as
         of such date; and (iii) for purposes of determining whether an
         employee is on the regular payroll as of December 31 of a Plan Year
         under this Article III, an employee receiving benefits pursuant to the
         Company's Short-Term Disability Program or Long-Term Disability Plan
         shall be deemed to be on the regular payroll as of such date if such
         employee had at least 26 completed weeks of active service during the
         Plan Year.

3.4      Any Participant whose employment terminates during a Plan Year (but
         prior to December 31 of such Plan Year) due to Disability, Retirement
         or death shall be eligible for a pro rata award for the Plan Year
         based on the number of his or her completed weeks of active service
         during the Plan Year, provided such Participant has accumulated at
         least 26 completed weeks of active service in the Plan Year.  In the
         event of an employee's death, the designated beneficiary of the
         employee under the Plan shall be the same as his or her designated
         beneficiary under the Company's Death Benefit Plan.

                                   Article IV

                           Administration of the Plan

4.1      The Plan shall be administered by the Compensation Committee.  Subject
         to the express provisions of the Plan, the Compensation Committee
         shall have the right and authority, in its sole and absolute
         discretion, (a) to adopt, amend, or rescind administrative and
         interpretive rules and regulations relating to the Plan; (b) to
         construe the Plan; (c) to make all other determinations necessary or
         advisable for administering the Plan; (d) to determine the terms and
         provisions of the respective agreements (which need not be identical)
         relating to the award of shares of Restricted Stock pursuant to
         Article IX hereof; (e) to construe such agreements; and (f) to
         exercise the powers conferred on the Compensation Committee under the
         Plan.  The Compensation Committee may correct any defect or supply any
         omission or reconcile any inconsistency in the Plan in the manner and
         to the extent it shall deem expedient to carry it into effect, and it
         shall be the sole and final judge of such expediency.  The
         determinations of the Compensation Committee on the matters referred
         to in this Section 4.1 shall be final and conclusive.

4.2      Subject to the express provisions of the Plan, the Compensation
         Committee shall have the exclusive authority to amend, modify,
         suspend, or terminate the Plan at any time; provided, however, that no
         amendment, modification, suspension or termination of the Plan shall
         in any manner adversely affect the right of any Participant to receive





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         any amount to which such Participant has become entitled prior to such
         amendment, modification, suspension or termination.

4.3      At the beginning of the Plan Year, the Chief Executive Officer of the
         Company shall make recommendations to the Compensation Committee
         regarding Performance Goals and the respective Threshold and Target
         levels of performance associated with each.  Within the first 90 days
         of the Plan Year the Compensation Committee will review the
         recommendations of the Chief Executive Officer and approve or modify
         the recommendations as presented.  In addition, as provided in more
         detail in Articles V and VI hereof, at the completion of the Plan
         Year, the Compensation Committee shall review and certify the Plan
         award levels based upon actual performance during the Plan Year, and
         may exercise discretion in approving the award for any Participant
         such that the Compensation Committee may reduce (but may not increase)
         any or all of a Participant's award otherwise determined in accordance
         with the formula set forth in this Plan and the performance results
         for such Plan Year.  The Compensation Committee may, in its
         discretion, design the award levels and performance goals for any Plan
         Year for any individual or group of individuals in a manner which will
         except any compensation paid to any such individual or group from the
         deduction limitations of Section 162(m) of the Internal Revenue Code
         of 1986, but the Compensation Committee is not obligated to do so.

                                   Article V

                              Target Award Levels

5.1      Participants in the Plan shall have Target Award Levels expressed as a
         percentage, not to exceed 100%, of their respective Base Salaries
         during the Plan Year.  The Target Award Levels for a Plan Year will be
         established for each Participant by the Compensation Committee within
         the first 90 days of the Plan Year.

                                   Article VI

            Determination of Performance Goals and Amount of Awards

6.1      Within the first 90 days of each Plan Year, the Compensation Committee
         shall establish the Performance Goals which shall provide the basis
         for calculating the annual incentive compensation award for
         Participants for such Plan Year.  The Performance Goals established by
         the Compensation Committee for a Plan Year may be based on stock
         price, cash flows, net income, operating income, expense levels, debt
         balance, debt ratings, total shareholder return, return on investment,
         return on equity, economic value added, production volumes, reserve
         additions, profit or cost





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         per equivalent barrel, earnings per share, net asset value per share,
         or such other goals as the Compensation Committee may determine
         appropriate for a Plan Year.  The Performance Goals may be based on
         the performance of the Company generally, in the absolute or in
         relation to its peers, or the performance of a particular employee,
         division, department, branch, subsidiary or other unit to which a
         particular employee is assigned.  In establishing the Performance
         Goals for the applicable Plan Year, the Compensation Committee may
         establish different Performance Goals for individual Participants or
         groups of Participants.  Each Performance Goal will be weighted to
         reflect its relative performance to the Company's strategic business
         plans for the Plan Year.  The sum of the weightings of the Performance
         Goals at the Target level for particular Participants or groups of
         Participants will equal 100% for the Plan Year.  Each Performance Goal
         will have stated Threshold and Target levels of performance which will
         provide a range of award possibilities.

6.2      As of the end of each Plan Year, a performance score will be
         determined by the Compensation Committee for each Performance Goal
         wherein achievement will be based upon actual performance compared to
         the Threshold and Target levels of performance.  The Compensation
         Committee shall certify the degree of achievement of each Performance
         Goal based upon the actual performance results for the Plan Year.  The
         results of the Performance Goals will be summed to determine the basis
         for the annual incentive compensation award for the Participant or
         group of Participants to which they apply, which sum may exceed 100%.

6.3      As of the end of the Plan Year, a Participant's incentive compensation
         award based upon attainment of Performance Goals for the Plan Year
         shall be calculated by multiplying such Participant's Base Salary by
         the Participant's Target Award Level for such Plan Year.  The result
         shall then be multiplied by the performance score applicable to such
         Participant as determined by the Compensation Committee for such Plan
         Year in accordance with Section 6.2 hereof.  After such amount is
         determined, the Compensation Committee may, in its sole discretion,
         reduce or eliminate (but may not increase) the amount of the award for
         a particular Participant based upon such factors as the Compensation
         Committee may determine to be relevant, including but not limited to
         such Participant's individual performance, but also shall take into
         consideration reliance placed on the Plan by the Participant in
         rendering performance during the Plan Year.  Any provision of this
         Plan to the contrary notwithstanding, the maximum incentive
         compensation award based upon attainment of Performance Goals that may
         be payable to any Participant for a Plan Year calculated as described
         above shall be 200% of his or her annualized weekly base salary in
         effect as of the first pay period ending during the Plan Year to which
         the award relates.

6.4      In addition to the incentive compensation awards based upon attainment
         of Performance Goals as set forth above, the Compensation Committee
         may, in its sole discretion, grant ad hoc incentive compensation
         awards to any Participant or group of Participants in such amount or
         amounts as it shall determine to be appropriate based





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         upon such factors as it shall deem to be relevant.  Any such ad hoc
         incentive compensation awards shall be determined and granted by the
         Compensation Committee after the Plan Year to which the award relates
         but prior to April 30 following the end of such Plan Year.

                                  Article VII

                           Form and Timing of Awards

7.1      Incentive compensation awards under the Plan may be paid in cash or
         shares of Common Stock, or in any combination thereof, at the
         discretion of the Compensation Committee.  Awards so paid in Common
         Stock shall be valued based on the Fair Market Value of the Common
         Stock as of the first business day following the completion of the
         Plan Year.  The manner of payment will be at the discretion of the
         Compensation Committee.  Awards shall be paid by April 30 following
         the completion of the Plan Year.  Awards shall be subject to the
         normal rules and regulations regarding the withholding for taxes and
         other deductions, if any, as may be in effect from time to time.

7.2      Certain Participants may elect to have their cash incentive
         compensation awards earned under the Plan (a) deferred in accordance
         with the provisions of Article VIII hereof or (b) paid to them in
         shares of Restricted Stock in accordance with the provisions of
         Article IX hereof.

                                  Article VIII

                          Voluntary Election to Defer

8.1      Participants eligible to participate in the Executive Deferred
         Compensation Plan may elect to defer their cash incentive compensation
         awards pursuant to the Plan by their voluntary election to participate
         in the Executive Deferred Compensation Plan.  Based upon the terms and
         provisions of the Executive Deferred Compensation Plan, certain
         Participants may irrevocably elect to defer the receipt of all or a
         portion of their earned cash incentive compensation awards to a
         specified future date such as retirement.  The election to participate
         in the Executive Deferred Compensation Plan must be made in writing
         and submitted to the Company's Human Resources Department before the
         commencement of the Plan Year.





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                                   Article IX

                 Voluntary Election to Receive Restricted Stock

9.1      Subject to the provisions of this Article IX, eligible Participants
         may elect to have their cash incentive compensation awards earned
         under the Plan for any Plan Year paid to them in shares of Restricted
         Stock.  An election made by an eligible Participant pursuant to this
         Article IX (a) may be made only as to increments of 25%, 50%, 75%, or
         100% of the Participant's cash incentive compensation award, (b) must
         be made in writing on a form approved for this purpose by the
         Compensation Committee and submitted to the Company's Human Resources
         Department on or before March 1 of the Plan Year in respect of which
         the award is earned (or on or before such later date as the
         Compensation Committee may approve), and (c) shall be irrevocable.
         The elections provided for under this Article IX are hereinafter
         referred to as "Restricted Stock Elections".  The payment of shares of
         Restricted Stock pursuant to this Article IX shall be subject to the
         approval of the Compensation Committee, which shall have the
         discretion to cause the Company to settle all or any part of the
         Company's payment obligation under a Restricted Stock Election by the
         payment to the Participant of his or her cash incentive compensation
         award in lieu of the shares of Restricted Stock the Company would
         otherwise be obligated to deliver.

9.2      Prior to February 15 of each Plan Year, the Compensation Committee
         shall designate the Participants or class or classes of Participants
         (if any) who shall be eligible to make Restricted Stock Elections with
         respect to awards earned under the Plan for such Plan Year.  Such
         determinations shall be in the sole discretion of the Compensation
         Committee.  A Participant who has made a Restricted Stock Election
         shall be eligible to receive shares of Restricted Stock pursuant
         thereto only if such Participant is an employee of the Company or a
         subsidiary thereof on the date that such shares are issued.  If the
         Participant is not so employed, then the Participant's prior election
         to receive shares of Restricted Stock in lieu of all or part of his or
         her cash incentive compensation award for such Plan Year shall be
         void.

9.3      The total number of shares of Restricted Stock to be paid to a
         Participant who has made a Restricted Stock Election shall be
         determined by dividing

                 (x)      the product obtained (the "Subject Amount") by
                          multiplying (i) the amount of the Participant's cash
                          incentive compensation award earned under the Plan
                          for the Plan Year times (ii) the percentage of such





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                          amount that the Participant elected to have paid in
                          shares of Restricted Stock pursuant to his or her
                          Restricted Stock Election,

                                       by

                 (y)      the Fair Market Value of the Common Stock as of the
                          first business day following the completion of the
                          Plan Year.

         In determining the number of shares of Restricted Stock to be paid to
         a Participant, the Compensation Committee may, in its discretion,
         increase the value of such Participant's Subject Amount by multiplying
         it by a factor, which shall not be greater than 150%, as determined by
         the Compensation Committee.  The factor shall be established by the
         Compensation Committee prior to February 15 of the Plan Year and shall
         be that rate which the Compensation Committee, in its sole discretion,
         determines to be appropriate for such Plan Year to reflect the
         Participant's election to forego cash compensation in exchange for
         shares of Restricted Stock.  No fractional shares of Common Stock
         shall be issued pursuant to this Section 9.3; instead, the Company
         shall pay to the Participant the amount of his or her cash incentive
         compensation award not converted into whole shares of Restricted Stock
         pursuant to this Section 9.3.

9.4      All shares of Restricted Stock issued to Participants pursuant to this
         Article IX with respect to a Plan Year shall be subject to a
         restricted period (the "Restricted Period"), the duration of which
         shall be determined by the Compensation Committee in its sole
         discretion prior to February 15 of such Plan Year.  The Restricted
         Period for shares of Restricted Stock issued to a Participant shall
         commence on the first business day following completion of the Plan
         Year.  Shares of Restricted Stock issued to a Participant pursuant to
         this Article IX shall be forfeited to the Company at no cost to the
         Company if the Participant's employment with the Company or a
         subsidiary of the Company terminates prior to the expiration or
         termination of the Restricted Period applicable to such shares;
         provided, however, that the shares of Restricted Stock shall become
         fully vested and the Restricted Period shall terminate upon (a) the
         Participant's termination of employment during the Restricted Period
         due to death, Disability, or Retirement, (b) the involuntary
         termination of the Participant's employment with the Company and its
         subsidiaries by action of the Company (or its subsidiary, with respect
         to a Participant employed by a subsidiary of the Company) during the
         Restricted Period for reasons other than Just Cause, or (c) the
         occurrence of a Corporate Change during the Restricted Period.  Unless
         and until shares of Restricted Stock are delivered to the Participant
         upon vesting, the shares of Restricted Stock shall not be sold,
         assigned, transferred, discounted, exchanged, pledged, or otherwise
         encumbered or disposed of by the Participant in any manner.  The
         Compensation Committee may from time to time, in its discretion, and
         subject to such terms and conditions as the Compensation Committee may
         prescribe, grant to Participants to whom shares of Restricted Stock
         have been issued pursuant to this





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         Article IX the right to extend the Restricted Period applicable to
         such shares for an additional period of time or until the occurrence
         of a specified event or events, in which case such shares shall remain
         subject to the restrictions of this Article IX for the period of such
         extension.

9.5      The Company shall issue, in the name of each Participant to whom
         shares of Restricted Stock have become payable pursuant to this
         Article IX (or, at the option of the Company, in the name of a nominee
         of the Company), stock certificates representing the total number of
         shares of Restricted Stock to be paid to the Participant with respect
         to a Plan Year, as soon as reasonably practicable after the date on
         which the Compensation Committee approves, certifies and announces the
         awards for such Plan Year.  The Company or its agent, at the direction
         of the Compensation Committee, shall hold such certificates, together
         with stock powers and any other instrument of transfer reasonably
         requested by the Company duly endorsed in blank, for the Participant's
         benefit until such time as the shares of Restricted Stock represented
         by such certificates are forfeited to the Company or the restrictions
         thereon terminate.

9.6      Upon the issuance of a certificate representing shares of Restricted
         Stock to a Participant, the Participant shall become the owner thereof
         for all purposes and shall have all rights as a stockholder, including
         voting rights and the right to receive dividends and distributions,
         with respect to such shares, subject to the provisions of this Article
         IX.  If the Company shall pay or declare a dividend or make a
         distribution of any kind, whether due to a reorganization,
         recapitalization, or otherwise, with respect to the shares of Common
         Stock constituting the shares of Restricted Stock, then the Company
         shall pay or make such dividend or other distribution with respect to
         the shares of Restricted Stock; provided, however, that the cash,
         stock or other securities and other property constituting such
         dividend or other distribution shall be held by the Company subject to
         the restrictions applicable to the shares of Restricted Stock until
         the shares with respect to which such dividend or other distribution
         was paid or made are either vested or forfeited.  If any shares of
         Restricted Stock with respect to which such dividend or distribution
         was paid or made do not vest but instead are forfeited pursuant to the
         provisions hereof, then the Participant shall not be entitled to
         receive such dividend or distribution with respect to such forfeited
         shares and such dividend or distribution with respect to such
         forfeited shares shall likewise be forfeited and automatically
         transferred to and reacquired by the Company.  If any shares of
         Restricted Stock with respect to which such dividend or distribution
         was paid or made become vested pursuant to the provisions hereof, then
         the Participant shall be entitled to receive such dividend or
         distribution with respect to such vested shares, without interest, and
         such dividend or distribution with respect to such vested shares shall
         likewise be delivered to the Participant.





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9.7      If any of the following events shall occur at any time while shares of
         Restricted Stock are outstanding and prior to the vesting or
         forfeiture thereof, the following adjustments shall be made in the
         number of shares of Common Stock then constituting such shares of
         Restricted Stock, as appropriate:

                 (a)      If the Company pays a dividend on its outstanding
                          shares of Common Stock in shares of Common Stock or
                          subdivides its outstanding shares of Common Stock
                          into a greater number of shares of Common Stock, the
                          number of shares of Common Stock then constituting
                          the shares of Restricted Stock shall be
                          proportionately increased.  Conversely, if the
                          outstanding shares of Common Stock are combined into
                          a smaller number of shares of Common Stock, the
                          number of shares of Common Stock then constituting
                          the shares of Restricted Stock shall be
                          proportionately reduced.  An adjustment made pursuant
                          to this Section 9.7(a) shall become effective as of
                          the record date in the case of a dividend and shall
                          become effective immediately after the effective date
                          in the case of a subdivision or combination.

                 (b)      In case of any recapitalization or reclassification
                          of the Common Stock, or any merger or consolidation
                          of the Company with or into one or more other
                          corporations, or any sale of all or substantially all
                          the assets of the Company, as a result of which the
                          holders of Common Stock receive other stock,
                          securities, or property in lieu of or in addition to,
                          but on account of, their shares of Common Stock, (A)
                          such other stock, securities, or property allocable
                          (as provided in clause (B) below) to the shares of
                          Common Stock then constituting the shares of
                          Restricted Stock shall be paid and delivered with
                          respect to such shares of Restricted Stock, subject
                          to the same restrictions applicable to such
                          Restricted Stock, and (B) the Company shall make or
                          cause to be made lawful and adequate provision
                          whereby, upon the vesting of the shares of Restricted
                          Stock after the record date for the determination of
                          the holders of Common Stock entitled to receive such
                          other stock, securities, or property, the Participant
                          shall receive, in lieu of or in addition to the
                          shares of Restricted Stock that have vested, as the
                          case may be, the shares of stock, securities, or
                          property that would have been allocable to such
                          shares of Restricted Stock had such shares vested
                          immediately prior to such record date.  The
                          subdivision or combination of shares of Common Stock
                          at any time outstanding into a greater or smaller
                          number of shares of Common Stock shall not be deemed
                          to be a recapitalization or reclassification of the
                          Common Stock for the purposes of this Section 9.7(b).

9.8      Upon the expiration or termination of the Restricted Period applicable
         to shares of Restricted Stock, the restrictions applicable to the
         shares of Restricted Stock that have





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<PAGE>   15
         not theretofore been forfeited shall terminate, and as soon as
         practicable thereafter a stock certificate for the number of shares of
         Restricted Stock with respect to which the restrictions have
         terminated, together with any dividends or other distributions with
         respect to such shares then being held by the Company pursuant to the
         provisions of this Article IX, shall be delivered, free of all such
         restrictions, to the Participant or the Participant's beneficiary or
         estate, as the case may be.

9.9      Each recipient of shares of Restricted Stock pursuant to this Article
         IX shall, as a condition precedent to the issuance of such shares to
         or on behalf of such person, enter into an agreement with the Company,
         in such form as the Compensation Committee shall prescribe and which
         is consistent with the provisions of the Plan, setting forth or
         incorporating the restrictions, terms, and conditions of the award of
         Restricted Stock.  An agreement may contain such provisions as the
         Compensation Committee deems appropriate to enable the Company or its
         appropriate affiliate to satisfy its federal and any applicable state
         and local tax withholding obligations, including provisions permitting
         the Company, upon the vesting of shares of Restricted Stock, to
         withhold delivery of shares of Restricted Stock or accept delivery of
         other shares of Common Stock owned by the Participant to satisfy such
         tax withholding obligations.  In the event of any inconsistency
         between the provisions of the Plan and any such agreement, the
         provisions of the Plan shall govern.

9.10     Notwithstanding anything contained in the Plan to the contrary, the
         Compensation Committee shall have the right to cancel all or any
         portion of any outstanding restrictions prior to the expiration or
         termination of such restrictions with respect to any or all shares of
         Restricted Stock on such terms and conditions as the Compensation
         Committee may, in writing, deem appropriate.

                                   Article X

                             No Right of Employment

10.1     Nothing in the Plan, including the employee's eligibility for
         participation in the Plan, will infer any right of employment by the
         Company or any subsidiary thereof to such employee.





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<PAGE>   16
                                   Article XI

                                 Miscellaneous

11.1     The total number of shares of Common Stock that may be issued,
         transferred, or awarded pursuant to Section 7.1 or Article IX of the
         Plan shall not exceed a maximum of 300,000 in the aggregate.  In the
         event the Company shall effect a split of the Common Stock or a
         dividend payable in Common Stock, or in the event the outstanding
         Common Stock shall be combined into a smaller number of shares, the
         maximum number of shares that may be issued or awarded under the Plan
         shall be increased or decreased proportionately.  Shares that have
         been previously delivered to a Participant as Restricted Stock that
         have since been forfeited shall be available for further issuance or
         award under the Plan.  Shares of Common Stock issued pursuant to the
         Plan may be shares of original issuance or treasury shares or a
         combination of the foregoing, as the Compensation Committee, in its
         discretion, shall from time to time determine.

11.2     Subject to the provisions of Article IX hereof, a Participant shall
         not have the right to anticipate, alienate, sell, transfer, assign,
         pledge, or encumber his or her right to receive any award made under
         the Plan.

11.3     No Participant shall have any lien on any assets of the Company or any
         subsidiary thereof by reason of any rights to any award made under the
         Plan.

11.4     No member of the Compensation Committee shall be liable for any act,
         omission, or determination taken or made in good faith with respect to
         the Plan or any awards made hereunder; and the members of the
         Compensation Committee shall be entitled to indemnification and
         reimbursement by the Company in respect of any claim, loss, damage, or
         expenses (including counsel fees) arising therefrom to the full extent
         permitted by law and under any directors' and officers' liability or
         similar insurance coverage that may be in effect from time to time.

11.5     The adoption of the Plan or any modification or amendment hereof does
         not imply any commitment to continue or adopt the same plan, or any
         modification hereof, or any other plan for incentive compensation for
         any succeeding year, provided that no termination, modification or
         amendment of the Plan shall adversely affect the right of any
         Participant to receive any amount to which such Participant has become
         entitled prior to such termination, modification, or amendment.

11.6     The laws of the State of Texas shall govern the Plan.





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<PAGE>   17

11.7     The Plan shall be binding on the successors of the Company.

11.8     The Plan shall be deemed adopted by the Board of Directors as of
         January 1, 1996.  The Plan shall be deemed effective as of the date of
         its adoption by the Board of Directors, provided it is duly approved
         by the holders of a majority of the shares of Common Stock present, or
         represented, and entitled to vote at the 1996 annual meeting of
         stockholders of the Company.  If the Plan is not approved by the
         stockholders, the Plan shall terminate and all actions taken hereunder
         shall be null and void.

IN WITNESS WHEREOF, Oryx Energy Company has caused this Plan to be executed by
its duly authorized representative this _____ day of ______________, 1996.

                                      ORYX ENERGY COMPANY

                                      By:   
                                         -----------------------------
ATTEST:

By:
   ---------------------------
Title:
      ------------------------




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