SECOND
AMENDMENT


TO


OPTION
AGREEMENT




This
Second Amendment to Option Agreement (this “Amendment”) is entered into
effective as of February 11, 2011 (“Effective Date”), by, between
and among American Liberty Petroleum Corp. (formerly known as “Oreon Rental Corporation”), a
Nevada domestic corporation (“Buyer”), and Desert
Discoveries, LLC, a Nevada domestic limited-liability company (“Seller”).




R E C I T
A L S:




A.
            Seller
      and Buyer entered into that certain Option Agreement dated May 11, 2010
      (as amended on October 23, 2010, the “Agreement”), with
      respect to the purchase and sale of certain oil and gas leases and other
      described rights and interests of
Seller.




B.
            Seller
      and Buyer have agreed to amend the Agreement as provided for in this
      Amendment.




C.
            Except
      as otherwise expressly defined in this Amendment, capitalized terms used
      herein shall have the same meaning as set forth in the
      Agreement.




A M E N D
M E N T:




In
consideration of the mutual covenants and agreements contained herein, Seller
and Buyer agree to amend the Agreement as follows:




1.  Section 1.2(a)(v).
The Agreement’s Section 1.2(a)(v) is hereby replaced and superseded in its
entirety by the following:




(iv)           the
payment by Buyer to Seller via the Escrow Account with Escrow Holder of an
additional two hundred thousand US dollars ($200,000 USD) on or before January
14, 2011; and




2.  Section 1.2(c). The
first sentence of the Agreement’s Section 1.2(c) is hereby replaced and
superseded in its entirety by the following:




The
aggregate payments to the Escrow Account of $600,000 USD required by Sections
1.2(a)(iii), (iv), and (v), plus the aggregate
payments to the Escrow Account, if any, under Section 1.2(h) (collectively, the
“Part OneWork Plan Funds”) shall be
held and used exclusively for the expenditures provided for in the Part One Work
Plan set forth as and in Exhibit 1.2(c)
hereto.




3.  Section
1.2(h).  The Agreement shall be amended by adding a new Section
1.2(h), which shall read in its entirety as follows:




(h)           Buyer
shall have the right, exercisable as set forth in this Section 1.2(h), to
purchase from Seller, as part of the Assets, a sixty percent (60%) working
interest owned by Seller in Bureau of Land Management Lease Number N-59901,
which was acquired by Seller as part of a larger purchase with Buyer’s consent
using a portion of the funds provided for in the second paragraph of the Part
One Work Plan, which shall be referred to as the “Cortez
Lease”.  Seller and Buyer acknowledge and agree that they have
agreed upon a form of Joint Operator Agreement for the development of the Kibby
Flats Lease, and a separate form for the Gibbs Lease, and that a condition to
Buyer’s exercise of its right to purchase the Cortez Lease is the mutual
agreement of both parties to include the Cortez Lease in one of those agreements
or to the form of a separate Joint Operator Agreement for the Cortez
Lease.  The parties shall endeavor in good faith to reach a mutually
satisfactory agreement as to Cortez Lease no later than April 1,
2011.  Buyer may exercise its right to include the Cortez Lease as
part of the Assets by providing written notice to Seller of its intention to do
so, along with the payment to the Escrow Agent of an additional two hundred
fifty thousand US dollars ($250,000 USD), at any time on or before June 1,
2011.  Upon such exercise, the Cortez Lease shall be thereafter deemed
part of the Assets for all purposes of this Agreement, and the additional
$250,000 shall be included in the amounts to be spent under the Part One Work
Plan.  If for any reason Buyer fails to timely make the foregoing
election and payment, then all rights and interest in and to the Cortez Lease
shall belong to Seller.









4.  Section 2.1. The
Agreement’s first recital and its Section 2.1 are hereby amended such that the
last day of the Term is extended from March 4, 2011 to June 11,
2011.




5.  Exhibit A. The
Agreement’s Exhibit A and all parenthetical references thereto in the Agreement
are hereby corrected to read “Exhibit 1.” Effective upon Buyer’s exercise of the
Cortez Option, the Agreement’s Exhibit 1 (f/k/a “Exhibit A”) shall be
automatically replaced and superseded in its entirety by the Exhibit 1 attached
hereto and hereby incorporated herein by this reference (which references as
Item 6 a sixty percent (60%) working interest in the Cortez Lease).




6.  Exhibit 1.2(a). The
Agreement’s Exhibit 1.2(a) and all parenthetical references thereto in the
Agreement are hereby corrected to read “Exhibit 2(a).”




7.  Exhibit 1.2(c). The
Agreement’s Exhibit 1.2(c) and all parenthetical references thereto in the
Agreement are hereby corrected to read “Exhibit 2(b).” Effective upon Buyer’s
election to purchase the Cortez Lease rights as noted in Section 1.2(h) of the
Agreement, Exhibit 2(b) (f/k/a “Exhibit 1.2(c)”) shall be automatically replaced
and superseded in its entirety by the Exhibit 2(b) attached hereto and hereby
incorporated herein by this reference.




5.  Exhibit 1.2(s). The
Agreement’s Exhibit 1.2(d) and all parenthetical references thereto in the
Agreement are hereby corrected to read “Exhibit 2(c).”




6.  Section 10.2. The
Agreement’s Section 10.2 is hereby amended to be read with the following
sentence inserted after the only sentence heretofore contained
therein:




Provided
Buyer has made all payments it is required to make under this Agreement, Seller
shall also indemnify Buyer from and against any and all damages and costs
suffered by Buyer with regard to the plugging and/or abandonment of the wells on
the leasehold referenced as Item 6 on Exhibit 1 hereto.




7.  Effect of Amendment.
Except as herein expressly amended, all terms, covenants and provisions of the
Agreement are and shall remain in full force and effect, and all references
therein to the “Agreement” shall henceforth refer to the Agreement as amended by
this Amendment. This Amendment shall be deemed incorporated into, and a part of,
the Agreement.




8.  Amendment and Waiver.
The provisions of this Amendment or the Agreement may be amended or waived only
with the prior written consent of the Parties, and no course of conduct or
failure or delay in enforcing the provisions of this Amendment shall affect the
validity, binding effect or enforceability of this Amendment or the
Agreement.




2




The
undersigned have executed this Amendment as of the Effective Date.




AMERICAN LIBERTY
      PETROLEUM CORP.By:
              /s/ Alvaro
      VollmersName:
      Alvaro VollmersTitle: 
       President and CEO






DESERT DISCOVERIES,
      LLCBy:
              /s/ Patrick
      FagenName: Patrick
      FagenTitle:  
      Manager




3






Exhibit
1




(Description
of Assets and Seller’s rights therein)




Lease
      (BLM Lease
                    Serial
      Number):
                  Property
                    Description:
                  Gross
                    Acres:
                  Working
                    Interest:
                  Net
      Revenue
                    Interest:1.NVN086972
                  T:
      12N, R: 35E, Meridian: MDM, State: NV, County: Nye
                    Sec.
      1, Lots 1-4, S2N2, S2;
                    Sec.
      2, Lots 1-4, S2N2, S2;
                    Sec.
      3, Lots 1-4,  S2N2, S2;
                    Sec.
      4, Lots 1-4,  S2N2, S2.
                  2,557.28
                  75%
                  63.375%2.NVN085029
                  T:
      06N, R: 37 1/2 E, Meridian: MD, State: NV, County: Esmeralda & Mineral
      Sec. 007, PROT ALL;
                    Sec.
      008, PROT ALL;
                    Sec.
      009, PROT ALL.
                  1,596.00
                  75%
                  63.375%3.NVN084761
                  T:
      0050N, R: 0380E, Meridian: MDM, State: NV, County: Esmeralda
                    Sec.
      005, PROT ALL;
                    Sec.
      006, PROT ALL;
                    Sec.
      007, PROT ALL;
                    Sec.
      008, PROT ALL.
                  2,547.00
                  75%
                  63.375%4.NVN083825
                  T:
      0050N, R: 38E, Meridian: 21 MDM, State: NV, County: Esmeralda
                    Sec.
      30, PROT ALL.
                  640.00
                  75%
                  63.375%5.NVN084762
                  T:
      0050N, R: 0380E, Meridian: MDM, State: NV, County: Esmeralda
                    Sec.
      017, PROT ALL;
                    Sec.
      018, PROT ALL;
                    Sec.
      019, PROT ALL;
                    Sec.
      020, PROT ALL.
                  2,537.00
                  75%
                  63.375%6.NVN59901
                  T:
      12N, R: 34E, Meridian: MDM, State: NV, County: Nye Sec. 1: Lots 1-4, S1/2
      N1/2, S1/2
                    Sec.
      12: All
                  3,840.56
                  60%
                  50.7%Sec.
      13: All
                    Sec.
      24: All
                    Sec.
      25: All
                    Sec.
      36: All
                    T:
      12N, R: 35E, Meridian: MDM, State: NV, County: Nye
                    Sec.
      13: All
                    Sec.
      23: All
                    Sec.
      24: W1/2
                    Sec.
      26: NW 1/4
                    Sec.
      27: All
                    Sec.
      28: All
                    Sec.
      29: All
                    Sec.
      30: Lots 1-4, E1/2 W1/2, E12
                    Sec.
      31: Lots 1-4, E1/2 W1/2, E12
                    Sec.
      32: All
                    Sec.
      33: All
                    Sec.
      34: NW 1/4




4




Exhibit
2(b)




Part One
Work Plan




The
parties recognize and acknowledge that oil exploration, particularly drilling
and its associated expenses, are both capital and time intensive. The parties
further recognize and acknowledge that, due to the payment schedule mandated by
this Agreement, significant exploratory work, particularly on the land subject
to the Gabbs Lease, will not be feasible or reasonable unless and until the
funds provided for in Sections 1.2(a)(iii), (iv), and (v) have been paid to
Seller as contemplated herein. The foregoing facts acknowledged, the Part One
Work Plan contemplates an aggregated expenditure of $850,000 USD during the year
after the date of this Agreement. The Part One Work Plan allocates for the
expenditure of this money accordingly:




$385,000
USD to be spent on geological and/or exploratory work necessary for the
development of the oil and gas resources underlying the Kibby Flats Leases
and/or the leasehold referenced by Item 6 in this Agreement’s Exhibit
1(the “Cortez
Lease”), and/or the
potential acquisition of nearby land parcels in fee and/or
leasehold;




$390,000
USD to be spent (subject to successful compliance with all applicable laws and
regulations, filing of all necessary applications, and receipt of all requisite
third-party approvals) for acquisition costs, including the posting of a
reclamation bond and the subsequent testing of the existing, abandoned well
located on the property underlying the Gabbs Lease, the posting of a reclamation
bond and the subsequent testing of the existing wells on the Cortez Lease, and the legal fees and filing
costs incurred to create and properly form and document a Nevada domestic
limited-liability company to act as third party operator for the leaseholds
referenced in this Agreement’s Exhibit
1. If rights to said well cannot for any reason be acquired, then, the
$390,000 will be spent on geological and/or exploratory work to develop the oil
and gas resources underlying the Gabbs Lease, Kibby Flats Leases, or Cortez
Lease —
and/or the potential acquisition of nearby land parcels in fee and/or
leasehold.




$15,000
USD to be spent for BLM Rental payments required under the Gabbs Lease, Kibby
Flats Leases, and the Cortez Lease to maintain same in good
standing.




$60,000
USD ($5,000 per month for one year) to retain on an independent contractor basis
an individual agreed upon by High Sierra, Fagen and Buyer to coordinate and
oversee work performed under the Part One Work Plan.




It is
expressly understood and agreed that all of Seller’s interest in any wells as
may be drilled on either the Gabbs and the Kibby Flats leases (as described
above) or nearby land parcels as may be acquired in fee and/or leasehold (as
described above), including the Cortez Lease, shall be and become part of the
Assets to be transferred and conveyed to Buyer at Closing. Furthermore, it is
expressly understood and agreed that all of Seller’s interest, if any, as well
as all liabilities, including but not limited to, reclamation bonds and costs,
that may arise in the existing abandoned well located on the property underlying
the Gabbs lease (including any improvements thereto and any
personal


property
associated therewith) shall be and become part of the Assets to be transferred
and conveyed to Buyer at Closing.




5




Any
portion of the funds held in the Escrow Account but not expensed prior to
Closing shall remain in the Escrow Account and be allocated towards one of the
above uses as deemed appropriate by the Operator.




High
Sierra Exploration, LLC and Nancy Fagen (and their successors or assigns) will
be not be required to pay any share or amounts towards the Part One Work Plan
expenditures until the funds provided for in Sections 1.2(a)(iii), (iv), and (v)
of the Agreement have been paid to Seller via the Escrow Account and expended
accordingly.




Unless
the abandoned well on the Nancy Fagen lease is able to be re-entered pursuant to
yet-to­be-determined regulatory permits, engineering feasibility studies,
and prudent business practices, that the sums envisioned to be provided by Buyer
for development of either or both of the Kibby Flats and Gabbs properties shall
limit field efforts to geological testing and survey work. Should a new, “from
scratch” well be drilled on either property, new funds will need to be raised in
amounts commensurate with such an effort.




The
parties acknowledge and agree that the JOA will be representative of the above
terms and all money paid towards the Part One Work Plan prior to the completion
of the JOA will be allocated accordingly.




6