PROMISSORY NOTE

$322,531.73     Harris  County,  Texas     September  28,  2007

     The  undersigned,  Colony Energy, Inc., a Delaware corporation (hereinafter
called  "Maker"),  whose address for the purposes of this Note is 2100 West Loop
South,  Suite  900,  Houston, Texas 77027, for value received, without grace, in
the  manner,  on the dates and in the amounts herein stipulated, promises to pay
to  the  order  of  CEI  Ventures,  LLC,  a  Texas  limited  liability  company
(hereinafter  called "Payee"), at Payee's principal place of business located at
2100 West Loop South, Suite 900, Houston, Texas 77027, or at such other place as
Payee  may  hereafter  designate,  the sum of THREE HUNDRED TWENTY-TWO THOUSAND,
FIVE HUNDRED THIRTY-ONE DOLLARS AND SEVENTY-THREE CENTS ($322,531.73), in lawful
money  of  the  United  States  of  America,  with  interest  at the rate herein
specified.

     The  unpaid principal balance from time to time outstanding hereunder shall
bear  interest from and after the date hereof until such balance is paid in full
at  a  fixed  rate  equal to TEN PERCENT (10%) per annum.  Interest on this Note
shall  be  computed  on the basis of a 365- day (or 366-day, as the case may be)
year  for  the  actual  number  of  days  elapsed.

     The  unpaid  principal  balance  of  this  Note with all accrued but unpaid
interest  thereon  shall  be  due and payable in full on DEMAND, or in the event
there  is  no  demand,  on or before midnight on fifth annual anniversary of the
date  of  this  Note.

     Maker reserves the right of prepaying the principal of and accrued interest
on  this  Note,  in  full  or  in  part,  at any time without the payment of any
prepayment  premium or fee.  Payee may, at Payee's option, apply any prepayments
received by Payee hereunder to the payment of accrued but unpaid interest and/or
principal,  in  any  order,  manner  or proportion that Payee deems appropriate.

     If  this  Note is not paid at maturity and said Note is placed in the hands
of  an  attorney  for collection or if collection by suit or through the probate
court, bankruptcy court, or by any other legal or judicial proceeding is sought,
Maker agrees to pay all expenses incurred, including reasonable attorneys' fees,
all  of  which  shall  become  a  part  of  the  principal  hereof.

     Maker and each and all other liable parties expressly and specifically, (i)
severally  waive  grace,  presentment for payment, demand for payment, notice of
intent to accelerate and notice of acceleration, notice of dishonor, protest and
notice  of  protest,  notice  of  nonpayment, and any and all other notices, the
filing  of  suit  and  diligence in collecting this Note or enforcing any of the
security  herefor,  (ii)  severally  agree  to  any substitution, subordination,
exchange  or  release  of  any security held for the payment of this Note or any
other  obligation  to  Payee  and  release of any party primarily or secondarily
liable  hereon,  (iii) severally agree that Payee shall not be required first to
institute suit or exhaust Payee's remedies hereon against Maker or other parties
liable  hereon or to enforce Payee's rights against them or any security herefor
in  order  to  enforce  payment  of this Note by any of them, and (iv) severally
agree  to  any  extension or postponement of time of payment of this Note and to
any  other indulgence with respect hereto without notice thereof to any of them.

     The  invalidity,  or  unenforceability  in particular circumstances, of any
provision  of  this  Note  shall  not  extend  beyond  such  provision  or  such
circumstances  and  no  other  provision of this Note shall be affected thereby.
     This Note is secured by a security interest in and general lien upon all of
Maker's  assets,  as  such security interest in and general lien were created in
that certain Security Agreement of even date herewith executed by Maker in favor
of  Payee.

     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE  STATE  OF  TEXAS  AND  THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.

          COLONY  ENERGY,  INC.


By:_______________________________________
                              Kent  E.  Lovelace,  Jr.,  President