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GUARANTEE

This
Guarantee dated this 8th day of August, 2013 is made by CARDERO
COAL LTD. to and in favour of E.L. II Properties Trust and Kopple Family
Partnership, L.P. (the Secured Creditors).

WHEREAS:

|A. | The Secured Creditors have agreed to purchase from the
      Borrower the Notes on the terms and conditions contained
therein;
|-- | ------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                               
|B. | The Guarantor requires the use of proceeds from the sale
      of the Notes for its business purposes;                        
|   |                                                                                                                               
|C. | It is a requirement under the Notes that the Guarantor
      execute and deliver this Guarantee; and                          
|   |                                                                                                                               
|D. | The Guarantor considers it in its best interests to
      provide this Guarantee.                                             

NOW
THEREFORE, to induce the Secured Creditors to extend credit to the Borrower,
and in consideration thereof, and for other good and valuable consideration, the
receipt and sufficiency of which are acknowledged, the Guarantor agrees as
follows:

ARTICLE 1INTERPRETATION

|1.1 | Defined Terms.                                                                                                                                                                                                                                                    
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                   
|    | As used in this Guarantee the following terms have the
      following meanings:                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                   
|    | Borrowermeans Cardero Resource Corp., a
      corporation existing under the laws of the Province of British Columbia,
      and its successors and permitted assigns.                                                                                          
|    |                                                                                                                                                                                                                                                                   
|    | Business Day means a day other than a Saturday,
      Sunday or any other day on which Canadian chartered banks located in the
      City of Vancouver, Province of British Columbia are not open for
      business.                                           
|    |                                                                                                                                                                                                                                                                   
|    | Credit Documentsmeans the Notes, this
      Agreement, the Security Documents, a subscription agreement dated as of
      the date hereof and all other documents to be executed and delivered to
      the Secured Creditors by the Borrower and the Guarantor.
|    |                                                                                                                                                                                                                                                                   
|    | Guaranteemeans this guarantee.                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                   
|    | Guarantormeans Cardero Coal Ltd. and its
      successors and permitted assigns.                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                   
|    | Guarantor Security Documentsmeans any and all
      agreements and documents executed and delivered contemporaneously
      herewith, and held by the Secured Creditors from time to time in
      connection with the Obligations.                             

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|    | Intercorporate Indebtednesshas the meaning
      specified in Section 3.5.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | Notesmeans the Senior Secured Notes of the
      Borrower purchased by the Secured Creditors in the aggregate principal
      amount of $5,700,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | Noticehas the meaning specified in Section
      5.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | Obligationsmeans (i) all debts, liabilities and
      obligations, present or future, direct or indirect, absolute or
      contingent, at any time or from time to time due or accruing due and owing
      by or otherwise payable by the Borrower to the Secured Creditors, in any
      currency, however or wherever incurred, and whether incurred by the
      Borrower alone or jointly with another or others and whether as principal,
      guarantor or surety and in whatever name or style, and (ii) the due
      performance and compliance by the Borrower with all of the terms and
      conditions of the Notes and the other Credit Documents, as such debts,
      liabilities and obligations may be varied from time to time as
      contemplated by Section 3.7.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | Other Taxesmeans present and future stamp and
      documentary taxes and any other excise and property taxes, charges,
      financial institutions duties, debits taxes and similar levies which arise
      from any payment made by the Guarantor under this Guarantee or under any
      of the Guarantor Security Documents or from the execution, delivery or
      registration of, or otherwise with respect to, this Guarantee or any of
      the Guarantor Security Documents.                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | Security Documentsat any time means each
      agreement, document and instrument delivered to the Secured Creditors as
      security for the Obligations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | Taxesmeans all taxes, levies, imposts,
      deductions, charges or withholdings and all related liabilities imposed by
      any country (or any political subdivision or taxing authority of
    it).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|1.2 | Interpretation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

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| | (d) | The division of this Guarantee into Articles, Sections
      and other subdivisions and the insertion of headings are for convenient
      reference only and are not to affect its interpretation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (e) | The schedules attached to this Guarantee form an integral
      part of it for all purposes of it.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (f) | Except as otherwise provided in this Guarantee, any
      reference to this Guarantee, any Credit Document or any Guarantor Security
      Document refers to this Guarantee or such Credit Document or Guarantor
      Security Document as the same may have been or may from time to time be
      amended, modified, extended, renewed, restated, replaced or supplemented
      and includes all schedules to it. Except as otherwise provided in this
      Guarantee, any reference in this Guarantee to a statute refers to such
      statute and all rules and regulations made under it as the same may have
      been or may from time to time be amended or re-enacted.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (g) | All references in this Guarantee to dollars, unless
      otherwise specifically indicated, are expressed in lawful currency of the
      United States of America.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

ARTICLE 2GUARANTEE

**2.1**     **Guarantee.**

The
Guarantor irrevocably and unconditionally guarantees to the Secured Creditors
the due and punctual payment, and the due performance, whether at stated
maturity, by acceleration or otherwise, of the Obligations. The Guarantor agrees
that the Obligations will be paid to the Secured Creditors strictly in
accordance with their terms and conditions.

2.2Indemnity.

If
any or all of the Obligations are not duly performed by the Borrower and are not
performed by the Guarantor under Section 2.1 for any reason whatsoever, the
Guarantor will, as a separate and distinct obligation, indemnify and save
harmless the Secured Creditors from and against all losses resulting from the
failure of the Borrower to duly perform such Obligations.

2.3Primary
Obligation

If
any or all of the Obligations are not duly performed by the Borrower and are not
performed by the Guarantor under Section 2.1 or the Secured Creditors are not
indemnified under Section 2.2, in each case, for any reason whatsoever, such
Obligations will, as a separate and distinct obligation, be performed by the
Guarantor as primary obligor. The Guarantor may, by notice in writing delivered
to the Secured Creditors, with effect from and after the date that is 30 days
following the date of receipt by the Secured Creditors of such notice, determine
its liability under this Guarantee in respect of liabilities thereafter incurred
or arising but not in respect of any liabilities theretofore incurred or arising
even though not then matured, provided, however, that notwithstanding receipt of
any such notice the Secured Creditors may fulfil any requirements of the Guarantor based on agreements express or
implied made prior to the receipt of such notice and any resulting liabilities
shall be covered by this Guarantee.

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2.4Absolute
Liability.

The
Guarantor agrees that the liability of the Guarantor under Section 2.1 and
Section 2.3 and, for greater certainty, under Section 2.2, is absolute and
unconditional irrespective of:

| | (a) | the lack of validity or enforceability of any terms of
      any of the Credit Documents;                                                                                                                                                                                                                                                                                                                                        
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (b) | any contest by the Borrower or any other Person as to the
      amount of the Obligations, the validity or enforceability of any terms of
      the Credit Documents or the perfection or priority of any security granted
      to the Secured Creditors;                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (c) | any defence, counter claim or right of set-off available
      to the Borrower;                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (d) | any release, compounding or other variance of the
      liability of the Borrower or any other Person liable in any manner under
      or in respect of the Obligations or the extinguishment of all or any part
      of the Obligations by operation of law;                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (e) | any change in the time or times for, or place or manner
      or terms of payment or performance of the Obligations or any consent,
      waiver, renewal, alteration, extension, compromise, arrangement,
      concession, release, discharge or other indulgences which the Secured
      Creditors may grant to the Borrower or any other Person;                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (f) | any amendment or supplement to, or alteration or renewal
      of, or restatement, replacement, refinancing or modification or variation
      of (including any increase in the amounts available thereunder or the
      inclusion of an additional borrower thereunder), or other action or
      inaction under, the Notes, the other Credit Documents or any other related
      document or instrument, or the Obligations;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (g) | any discontinuance, termination, reduction, renewal,
      increase, abstention from renewing or other variation of any credit or
      credit facilities to, or the terms or conditions of any transaction with,
      the Borrower or any other Person;                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (h) | any change in the ownership, control, name, objects,
      businesses, assets, capital structure or constitution of the Borrower or
      the Guarantor or any reorganization (whether by way of reconstruction,
      consolidation, amalgamation, merger, transfer, sale, lease or otherwise)
      of the Borrower or the Guarantor or their respective businesses;                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (i) | any dealings with the security which the Secured
      Creditors hold or may hold pursuant to the terms and conditions of the
      Credit Documents, including the taking, giving up or exchange of
      securities, their variation or realization, the accepting of compositions
      and the granting of releases and discharges;                                                                                          

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| | (j) | any limitation of status or power, disability, incapacity
      or other circumstance relating to the Borrower or the Guarantor or any
      other Person, including any bankruptcy, insolvency, reorganization,
      composition, adjustment, dissolution, liquidation, winding-up or other
      like proceeding involving or affecting the Borrower or the Guarantor or
      any other Person or any action taken with respect to this Guarantee by any
      trustee or receiver, or by any court, in any such proceeding, whether or
      not the Guarantor shall have notice or knowledge of any of the
      foregoing; 
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (k) | the assignment of all or any part of the benefits of this
      Guarantee by the Secured Creditors;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (l) | any impossibility, impracticability, frustration of
      purpose, force majeure or illegality of any Credit Document, or the
      occurrence of any change in the laws, rules, regulations or ordinances of
      any jurisdiction or by any present or future action of (i) any
      governmental entity that amends, varies, reduces or otherwise affects, or
      purports to amend, vary, reduce or otherwise affect, any of the
      Obligations or the obligations of the Guarantor under this Guarantee, or
      (ii) any court order that amends, varies, reduces or otherwise affects any
      of the Obligations;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (m) | any taking or failure to take security, any loss of, or
      loss of value of, any security, or any invalidity, non-perfection or
      unenforceability of any security held by the Secured Creditors, or any
      exercise or enforcement of, or failure to exercise or enforce, security,
      or irregularity or defect in the manner or procedure by which the Secured
      Creditors realize on such security;                                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (n) | any application of any sums received to the Obligations,
      or any part thereof, and any change in such application; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (o) | any other circumstances which might otherwise constitute
      a defence available to, or a discharge of, the Guarantor, the Borrower or
      any other Person in respect of the Obligations or this
  Guarantee.                                                                                                                                                                                                                                                                                                                                                                                                                

ARTICLE 3ENFORCEMENT

3.1Remedies.

The
Secured Creditors are not bound to exhaust their recourse against the Borrower
or any other Person or realize on any security it may hold in respect of the
Obligations before being entitled to (i) enforce payment and performance under
this Guarantee or (ii) pursue any other remedy against the Guarantor, and the
Guarantor renounces all benefits of discussion and division.

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3.2Amount of
Obligations.

Any
account settled or stated by or between the Secured Creditors and the Borrower,
or if any such account has not been settled or stated immediately before demand
for payment under this Guarantee, any account stated by the Secured Creditors
shall, in the absence of manifest error, be accepted by the Guarantor as
conclusive evidence of the amount of the Obligations which is due by the
Borrower to the Secured Creditors or remains unpaid by the Borrower to the
Secured Creditors.

3.3Payment on
Demand.

The
Guarantor will pay and perform the Obligations and pay all other amounts payable
by it to the Secured Creditors under this Guarantee, and the obligation to do so
arises, immediately after demand for such payment or performance is made in
writing to it. The liability of the Guarantor bears interest from the date of
such demand at the rate or rates of interest then applicable to the Obligations
under and calculated in the manner provided in the Credit Documents (including
any adjustment to give effect to the provisions of the Interest Act(Canada)).

3.4Costs and
Expenses.

The
Guarantor is liable for and will pay on demand by the Secured Creditors any and
all reasonable expenses, costs and charges incurred by or on behalf of the
Secured Creditors in connection with this Agreement, including all reasonable
legal fees, courts costs, receivers or agents remuneration and other expenses
in connection with enforcing any of their rights under any of the Credit
Documents.

3.5Assignment
and Postponement.

| | (a) | All obligations, liabilities and indebtedness of the
      Borrower to the Guarantor of any nature whatsoever and all security
      therefor (the Intercorporate Indebtedness) are assigned and
      transferred to the Secured Creditors as general, continuing and collateral
      security for the Guarantors obligations under this Guarantee and
      postponed to the payment in full of all Obligations. Until the occurrence
      of an Event of Default (unless it is waived in writing by the Secured
      Creditors), the Guarantor may receive payments in respect of the
      Intercorporate Indebtedness as permitted under the Notes. The Guarantor
      will not assign all or any part of the Intercorporate Indebtedness to any
      Person other than the Secured Creditors.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (b) | Upon the occurrence of an Event of Default which is not
      waived in writing by the Secured Creditors, all Intercorporate
      Indebtedness shall be, and shall be deemed to be, held in trust for the
      Secured Creditors and will be collected, enforced or proved subject to,
      and for the purpose of, this Guarantee. In such event, any payments
      received by the Guarantor in respect of the Intercorporate Indebtedness
      shall be, and shall be deemed to be, held in trust for the Secured
      Creditors and segregated from other funds and property held by the
      Guarantor and immediately paid to the Secured Creditors on account of the
      Obligations.                                                                                                      

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| | (c) | The Intercorporate Indebtedness shall not be released or
      withdrawn by the Guarantor without the prior written consent of the
      Secured Creditors. The Guarantor will not allow a limitation period to
      expire on the Intercorporate Indebtedness or ask for or obtain any
      security or negotiable paper for, or other evidence of, the Intercorporate
      Indebtedness except for the purpose of delivering the same to the Secured
      Creditors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (d) | In the event of any insolvency, bankruptcy or other
      proceeding involving the liquidation, arrangement, compromise,
      reorganization or other relief with respect to the Borrower or its debts,
      the Guarantor will, upon the request of the Secured Creditors, make and
      present a proof of claim or commence such other proceedings against the
      Borrower on account of the Intercorporate Indebtedness as may be
      reasonably necessary to establish the Guarantors entitlement to payment
      of any Intercorporate Indebtedness. Such proof of claim or other
      proceeding must be made or commenced prior to the earlier of (i) the day
      which is 30 days after notice requesting such action is delivered by or on
      behalf of the Secured Creditors to the Guarantor, and (ii) the day which
      is 10 days preceding the date when such proof of claim or other proceeding
      is required by applicable law to be made or commenced. Such proof of claim
      or other proceeding must be in form and substance acceptable to the
      Secured Creditors, acting reasonably.                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (e) | If the Guarantor fails to make and file such proof of
      claim or commence such other proceeding in accordance with this Section,
      the Secured Creditors are irrevocably authorized, empowered and directed
      and appointed the true and lawful attorney of the Guarantor (but is not
      obliged) with the power to exercise for and on behalf of the Guarantor the
      following rights, upon the occurrence of an Event of Default which is not
      waived in writing by the Secured Creditors: (i) to make and present for
      and on behalf of the Guarantor proofs of claims or other such proceedings
      against the Borrower on account of the Intercompany Indebtedness, (ii) to
      demand, sue for, receive and collect any and all dividends or other
      payments or disbursements made in respect of the Intercompany Indebtedness
      in whatever form the same may be paid or issued and to apply the same on
      account of the Obligations, and (iii) to demand, sue for, collect and
      receive each such payment and distribution and give acquittance therefor
      and to file claims and take such other actions, in their own names or in
      the name of the Guarantor or otherwise, as the Secured Creditors may deem
      necessary or advisable to enforce their rights under this
  Guarantee.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (f) | The Guarantor will execute all subordinations,
      postponements, assignments and other agreements as the Secured Creditors
      may reasonably request to more effectively subordinate and postpone the
      Intercorporate Indebtedness to the payment and performance of the
      Obligations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (g) | The provisions of this Section 3.5 survive the
      termination of this Guarantee and remain in full force and effect until
      (i) the Obligations and all other amounts owing under the Credit Documents
      are indefeasibly repaid and performed in full; and (ii) the Secured Creditors has no further obligations under
any of the Credit Documents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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3.6Suspension
of Guarantor Rights.

So
long as there are any Obligations, the Guarantor shall not exercise any rights
which it may at any time have by reason of the performance of any of its
obligations under this Guarantee (i) to be indemnified by the Borrower, (ii) to
claim contribution from any other Person, or (iii) subject to Section 3.8, to
take the benefit (in whole or in part and whether by way of subrogation or
otherwise) of any rights of the Secured Creditors under any of the Credit
Documents.

3.7No Prejudice
to Secured Creditors.

The
Secured Creditors are not prejudiced in any way in the right to enforce any
provision of this Guarantee by any act or failure to act on the part of the
Borrower or the Secured Creditors. The Secured Creditors may, at any time and
from time to time, in such manner it determines is expedient, without any
consent of, or notice to, the Guarantor and without impairing or releasing the
obligations of the Guarantor (i) change the manner, place, time or terms of
payment or performance of the Obligations, (ii) renew or alter the Obligations,
(iii) amend, vary, modify, supplement or replace any Credit Document or any
other related document or instrument, (iv) discontinue, reduce, renew, increase,
abstain from renewing or otherwise vary any credit or credit facilities to, any
transaction with, the Borrower or any other Person, (v) release, compound or
vary the liability of the Borrower or any other Person liable in any manner
under or in respect of the Obligations, (vi) take or abstain from taking
securities or collateral from any other Person, or from perfecting securities or
collateral of any other Person, (vii) exercise or enforce or refrain from
exercising or enforcing any right or security against the Borrower, the
Guarantor or any other Person, (viii) accept compromises or arrangement from any
Person, (ix) apply any sums from time to time received to the Obligations, or
any part thereof, and change any such application in whole or in part from time
to time, (x) otherwise deal with, or waive or modify their right to deal with,
any Person and security. In their dealings with the Borrower, the Secured
Creditors need not enquire into the authority or power of any Person purporting
to act for or on behalf of the Borrower.

3.8Rights of
Subrogation.

Any
rights of subrogation acquired by the Guarantor by reason of payment under this
Guarantee shall not be exercised until the Obligations and all other amounts due
to the Secured Creditors have been indefeasibly paid and performed in full and
such rights of subrogation shall be no greater than the rights held by the
Secured Creditors. In the event (i) of the liquidation, winding up or bankruptcy
of the Borrower (whether voluntary or compulsory), (ii) that the Borrower makes
a bulk sale of any of its assets within the meaning of any bulk sales or
insolvency legislation, or (iii) that the Borrower makes any composition with
creditors or enters into any scheme of arrangement, the Secured Creditors have
the right to rank in priority to the Guarantor for their full claims in respect
of the Obligations and receive all dividends and other payments until their
claims have been indefeasibly paid in full. The Guarantor will continue to be
liable, less any payments made by it, for any balance which may be owing to the
Secured Creditors by the Borrower. No valuation or retention of their security
by the Secured Creditors shall, as between the Secured Creditors and the Guarantor, be
considered as a purchase of such security or as payment or satisfaction or
reduction of all or any part of the Obligations. If any amount is paid to the
Guarantor at any time when all the Obligations and other amounts due to the
Secured Creditors have not been paid in full, the amount shall be, and shall be
deemed to be, held in trust for the benefit of the Secured Creditors and
immediately paid to the Secured Creditors to be credited and applied to the
Obligations as it sees fit, whether matured or unmatured. The Guarantor has no
recourse against the Secured Creditors for any invalidity, non-perfection or
unenforceability of any security held by the Secured Creditors or any
irregularity or defect in the manner or procedure by which the Secured Creditors
realize on such security.

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3.9No Set-off.

To
the fullest extent permitted by law, the Guarantor makes all payments under this
Guarantee without regard to any defence, adverse claim, counter-claim or right
of set-off available to it.

3.10Successors of the
Borrower.

This
Guarantee will not be revoked by any change in the constitution of the Borrower.
This Guarantee and the Guarantor Security Documents extend to any Person
acquiring, or from time to time carrying on, the business of the Borrower.

3.11Continuing Guarantee
and Continuing Obligations.

The
obligation of the Guarantor under Section 2.1 is a continuing guarantee, and the
obligations of the Guarantor under Section 2.2 and Section 2.3 are continuing
obligations. Each of Section 2.1, Section 2.2 and Section 2.3 extends to all
present and future Obligations, applies to and secures the ultimate balance of
the Obligations due or remaining due to the Secured Creditors and is binding as
a continuing obligation of the Guarantor until the Secured Creditors releases
the Guarantor. This Guarantee shall continue to be effective or be reinstated,
as the case may be, if at any time any payment of any of the Obligations is
rescinded or must otherwise be returned by the Secured Creditors upon the
insolvency, bankruptcy or reorganization of the Borrower or otherwise, all as
though the payment had not been made.

3.12Supplemental Security.

This
Guarantee is in addition and without prejudice to and supplemental to all other
guarantees, indemnities, obligations and security now held or which may
hereafter be held by the Secured Creditors.

3.13Security for Guarantee.

The
Guarantor acknowledges that this Guarantee is intended to secure payment and
performance of the Obligations and that the payment and performance of the
Obligations and the other obligations of the Guarantor under this Guarantee are
secured pursuant to the terms and provisions of the Guarantor Security
Documents.

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3.14Right of Set-off.

Upon
the occurrence of any Event of Default which is not waived in writing by the
Secured Creditors, the Secured Creditors are authorized by the Guarantor at any
time and from time to time and may, to the fullest extent permitted by law, set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by the Secured Creditors to or for the credit or the account of the Guarantor
against any and all of the obligations of the Guarantor now or hereafter
existing irrespective of whether or not (i) the Secured Creditors have made any
demand under this Guarantee, or (ii) any of the obligations comprising the
Obligations which are contingent or unmatured. The rights of the Secured
Creditors under this Section 3.14 are in addition and without prejudice to and
supplemental to other rights and remedies which the Secured Creditors may have.

3.15Interest Act (Canada).

The
Guarantor acknowledges that certain of the rates of interest applicable to the
Obligations may be computed on the basis of a year of 365 days. For purposes of
the Interest Act (Canada), whenever any interest is calculated using a
rate based on a year of 365 days, such rate determined pursuant to such
calculation, when expressed as an annual rate is equivalent to (i) the
applicable rate based on a year of 365 days, (ii) multiplied by the actual
number of days in the calendar year in which the period for such interest is
payable (or compounded) ends, and (iii) divided by 365.

3.16Taxes.

| | (a) | All payments to the Secured Creditors by the Guarantor
      under this Guarantee or under any of the Guarantor Security Documents will
      be made free and clear of and without deduction or withholding for any and
      all Taxes, unless such Taxes are required by applicable law to be deducted
      or withheld. If the Guarantor is required by applicable law to deduct or
      withhold any such Taxes from or in respect of any amount payable under
      this Guarantee or under any of the Guarantor Security Documents (i) the
      amount payable shall be increased (and for greater certainty, in the case
      of interest, the amount of interest shall be increased) as may be
      necessary so that after making all required deductions or withholdings
      (including deductions or withholdings applicable to any additional amounts
      paid under this Section 3.16), the Secured Creditors receive an amount
      equal to the amount it would have received if no such deduction or
      withholding had been made, (ii) the Guarantor will make such deductions or
      withholdings, and (iii) the Guarantor will immediately pay the full amount
      deducted or withheld to the relevant Governmental Entity in accordance
      with applicable law.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (b) | The Guarantor agrees to immediately pay any Other
      Taxes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (c) | The Guarantor will indemnify the Secured Creditors for
      the full amount of Taxes and Other Taxes (including, without limitation,
      any Taxes or Other Taxes imposed by any jurisdiction on amounts payable by
      the Guarantor under this Section 3.16 but specifically excluding regular income
      tax paid on interest income) paid by the Secured Creditors and any
      liability (including penalties, interest and expenses) arising from or
      with respect to such Taxes and Other Taxes, whether or not they were
      correctly or legally asserted. Payment under this indemnification will be
      made within 30 days from the date the Secured Creditors make written
      demand for it. A certificate as to the amount of such Taxes and Other
      Taxes submitted to the Guarantor by the Secured Creditors is conclusive
      evidence, absent manifest error, of the amount due from the Guarantor to
  the Secured Creditors.                                                                                                                                                                                                                                                                                                                               

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| | (d) | The Guarantor will furnish to the Secured Creditors the
      original or a certified copy of a receipt evidencing payment of any Taxes
      or Other Taxes made by the Guarantor within 30 days after the date of any
      payment of such Taxes or Other Taxes.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                    
| | (e) | The provisions of this Section 3.16 survive the
      termination of this Guarantee.                                                                                                                                                                               

ARTICLE 4REPRESENTATIONS, WARRANTIES AND
COVENANTS

4.1Representations and Warranties.

The
Guarantor represents and warrants, acknowledging and confirming that that the
Secured Creditors are relying on such representations and warranties in
connection with the acceptance of this Guarantee, that:

| | (a) | Incorporation and Qualification.The Guarantor is
      a corporation incorporated and existing under the laws of its jurisdiction
      of incorporation.                                                                                                                                   
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                             
| | (b) | Corporate Power.The Guarantor has the corporate
      power to (i) own, lease and operate its properties and assets and carry on
      its business as now being conducted by it, and (ii) enter into and perform
      its obligations under the Credit Documents to which it is a
  party.
| |     |                                                                                                                                                                                                                                                                                             
| | (c) | Conflict With Other Instruments.The execution and
      delivery by the Guarantor and the performance by it under, and compliance
      with the terms, conditions and provisions of, the Credit Documents to
      which it is a party:                                                    
| |     |                                                                                                                                                                                                                                                                                             
| |     | (i)                                                                                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                             
| |     | (ii)                                                                                                                                                                                                                                                                                        

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| | (iii) | do not and will not result in the violation of any law,
      regulation or rule or any judgment, injunction, order, writ, decision,
      ruling or award which is binding on it.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Authorized and Issued Capital.At this date, 100%
      of the issued and outstanding shares of the Guarantor are owned by the
      Borrower as the registered and beneficial owner with a good title, free
      and clear of all Liens other than Permitted Encumbrances and those
      restrictions on transfer, if any, contained in the articles of the
      Guarantor.                                                                                                                                                                                                                                                 
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (e) | Execution and Binding Obligation.This Guarantee
      and the other Credit Documents to which it is a party have been duly
      executed and delivered by the Guarantor and constitute legal, valid and
      binding agreements of it enforceable against it in accordance with their
      respective terms, subject only to any limitation under applicable laws
      relating to (i) bankruptcy, insolvency, arrangement and other laws of
      general application affecting the enforcement of creditors rights, and
      (ii) the discretion that a court may exercise in the granting of equitable
      remedies.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (f) | Notes Representations.Each representation and
      warranty made by the Borrower pursuant to the subscription agreement
      between the Secured Creditors and the Borrower dated the date hereof, to
      the extent it pertains to the Guarantor, the business of the Guarantor and
      the Credit Documents to which the Guarantor is a party, is true, accurate
      and complete in all material respects.                                                                                                                                                                                                          

4.2Notes
Covenants.

Until
the Obligations and all other amounts owing under this Guarantee are
indefeasibly paid or repaid in full, the Obligations are performed in full and
the Secured Creditors have no obligations under the Credit Documents, the
Guarantor covenants and agrees that it will take, or will refrain from taking,
as the case may be, all actions that are necessary to be taken or not taken so
that no violation of any provision, covenant or agreement contained in the
Notes, and so that no Event of Default, is caused by the actions of the
Guarantor.

ARTICLE 5GENERAL

5.1Notices,
etc.

Any
notice or other communication required or permitted to be given hereunder shall
be in writing and shall be given by registered mail, by facsimile or other means
of electronic communication or by hand-delivery as hereinafter provided. Any
such notice or other communication, if mailed by registered mail at any time
other than during, or within three (3) business days prior to, a general
discontinuance of postal service due to strike, lockout or otherwise, shall be
deemed to have been received on the fourth business day after the postmarked
date thereof, or if sent by facsimile or other means of
electronic communication, shall be deemed to have been received on the Business
Day of the sending (provided it was sent before 4:30 p.m. Toronto time) and the
applicable printed facsimile record shall be definitive evidence of the time and
date of such facsimile transmission, or if delivered by hand shall be deemed to
have been received at the time it is delivered to the applicable address noted
below either to the individual designated below or to an employee of the
addressee at such address with responsibility for matters to which the
information relates. Notice of change of address shall also be governed by this
Section 8.7. In the event of a general discontinuance of postal service due to
strike, lock-out or otherwise, notices or other communications shall be
delivered by hand or sent by facsimile or other means of electronic
communication and shall be deemed to have been received in accordance with the
foregoing. Notices and other communications shall be addressed as follows:

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- 13 -

Cardero Resource Corp. Suite 2300 
1177 West Hastings Street. Vancouver, British Columbia V6E 2K3

Attention:              Lawrence
Talbot, Vice-President & General Counsel
Facsimile:              
604-408-7499

with a copy (that does not constitute
notice) to:

Gowling Lafleur Henderson LLP 550
Burrard Street, Suite 2300 Vancouver, BC V6C 2B5

Attention:              Daniel
Allen
Fascimile:              
604-689-8610

if to the Secured Creditors:

[Redacted]

Attention:              Robert
C. Kopple, Trustee

Facsimile:               •

with a copy (that does not constitute
notice) to:

Owen Bird Law CorporationBentall 3
595 Burrard Street, Suite 2900 Vancouver, BC V7X 1J5

Attention:              Jeffrey
B. Lightfoot
Facsimile:              
604-688-2827

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5.2No Merger,
Survival of Representations and Warranties.

The
representations, warranties and covenants of the Guarantor in this Guarantee
survive the execution and delivery of this Guarantee. Notwithstanding any
investigation made by or on behalf of the Secured Creditors, the
representations, warranties and covenants in this Guarantee continue in full
force and effect.

5.3Further
Assurances.

| | (a) | The Guarantor will do all acts and things and execute and
      deliver, or cause to be executed and delivered, all documents and
      instruments that the Secured Creditors may reasonably request to give full
      effect to this Guarantee and to perfect and preserve the rights and powers
      of the Secured Creditors under this Guarantee, including any
      acknowledgements and confirmations of this Guarantee and the Guarantor
      Security Documents.           
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (b) | The Guarantor acknowledges and confirms that the
      Guarantor itself has established its own adequate means of obtaining from
      the Borrower on a continuing basis all information desired by the
      Guarantor concerning the financial condition of the Borrower and that the
      Guarantor will look to the Borrower and not to the Secured Creditors, in
      order for the Guarantor to keep adequately informed of changes in the
      Borrower financial condition.

5.4Successors
and Assigns.

This
Guarantee is binding upon the Guarantor, its successors and assigns, and enures
to the benefit of the Secured Creditors and their successors and assigns. This
Guarantee may be assigned by the Secured Creditors in accordance with the
provisions of the Notes. In any action brought by an assignee to enforce any
such right or remedy, the Guarantor will not assert against the assignee any
claim or defence which the Guarantor now has or may have against the Secured
Creditors. The Guarantor may not assign, transfer or delegate any of its rights
or obligations under this Guarantee without the prior written consent of the
Secured Creditors which may be unreasonably withheld.

5.5Amendment.

This
Guarantee may only be amended, supplemented or otherwise modified by written
agreement executed by the Secured Creditors and the Guarantor.

5.6Waivers,
etc.

| | (a) | No consent or waiver by the Secured Creditors in respect
      of this Guarantee is binding unless made in writing and signed by an
      authorized officer of the Secured Creditors. Any consent or waiver given
      under this Guarantee is effective only in the specific instance and for
      the specific purpose for which given. No waiver of any of the provisions
      of this Guarantee constitutes a waiver of any other
  provision.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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- 15 -

| | (b) | A failure or delay on the part of the Secured Creditors
      in exercising a right under this Guarantee does not operate as a waiver
      of, or impair, any right of the Secured Creditors however arising. A
      single or partial exercise of a right on the part of the Secured Creditors
      does not preclude any other or further exercise of that right or the
      exercise of any other right by the Secured
Creditors.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5.7Severability.

If
any court of competent jurisdiction from which no appeal exists or is taken,
determines that any provision of this Guarantee is illegal, invalid or
unenforceable, that provision will be severed from this Guarantee and the
remaining provisions will remain in full force and effect.

5.8Application
of Proceeds.

All
monies collected by the Secured Creditors under this Guarantee will be applied
as provided in the Notes. To the extent any other Credit Document requires
proceeds of collateral under such Credit Document to be applied in accordance
with the provisions of this Guarantee, the Secured Creditors or holder under
such other Credit Document shall apply such proceeds in accordance with this
Section 5.8.

5.9Governing
Law.

| | (a) | This Guarantee shall exclusively (without regard to any
      principle or rule relating to conflicts of laws) be governed by,
      interpreted and enforced in accordance with the laws of the Province of
      British Columbia and the federal laws of Canada applicable
  therein.                                                                                                                                                                                                                                                                                                                                                                                      
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (b) | The Guarantor irrevocably attorns and submits to the
      non-exclusive jurisdiction of any court of competent jurisdiction of the
      Province of British Columbia sitting in Vancouver in any action or
      proceeding arising out of or relating to this Guarantee and the other
      Credit Documents to which it is a party. The Guarantor irrevocably waives
      objection to the venue of any action or proceeding in such court or that
      such court provides an inconvenient forum. Nothing in this Section 5.9
      limits the right of the Secured Creditors to bring proceedings against the
      Guarantor in the courts of any other jurisdiction.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (c) | The Guarantor hereby irrevocably consents to the service
      of any and all process in any such action or proceeding by the delivery of
      copies of such process to the Guarantor at the address of the Guarantor
      set out herein. Nothing in this Section 5.9 affects the right of the
      Secured Creditors to serve process in any manner permitted by
  law.                                                                                                                                                                                                                                                                                                 

5.10Paramountcy.

In
the event of any conflict with the provisions hereof and the provisions of the
Notes, the provisions of the Notes shall prevail and govern but only to the
extent of such conflict.

[Remainder of Page Intentionally Left Blank.]

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- 16 -

IN WITNESS WHEREOF the Guarantor has
executed and delivered this Guarantee under seal by its duly authorized signing
officer.

CARDERO COAL LTD.



| | By: | (signed) Lawrence Talbot               
| | --- | ---------------------------------------
| |     | Name: Lawrence Talbot                  
| |     | Title: Vice-President & General Counsel
| |     | Authorized Signing Officer             

---