Exhibit 2.1
 
 ENDEAVOUR ENERGY UK LIMITED
 BAYERNGAS E & P LIMITED
 BAYERNGAS UK LIMITED
 
 SALE AND PURCHASE AGREEMENT




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CONTENTS
 CLAUSE
    
    PAGE1.   SALE AND PURCHASE
    
    
    22.   PRICE
    
    
    23.   CYGNUS INTERESTS CONDITIONS PRECEDENT
    
    
    34.   INTERIM PERIOD
    
    
    45.   CYGNUS INTERESTS CLOSING
    
    
    56.   POST CYGNUS INTERESTS CLOSING ADJUSTMENTS
    
    
    67.   EXPLORATION INTERESTS CONDITIONS PRECEDENT
    
    
    78.   EXPLORATION INTERESTS CLOSING
    
    
    89.   SELLER WARRANTIES
    
    
    910. PURCHASER WARRANTIES
    
    
    1011. INDEMNITIES
    
    
    1012. CONDUCT OF PURCHASER CLAIMS
    
    
    1113. CONDUCT OF SELLER CLAIMS
    
    
    1214. NO RIGHTS OF RESCISSION OR TERMINATION
    
    
    1215. TAX
    
    
    1216. INSURANCE
    
    
    1417. PAYMENTS
    
    
    1518. ANNOUNCEMENTS
    
    
    1519. CONFIDENTIALITY
    
    
    1520. ASSIGNMENT
    
    
    1721. FURTHER ASSURANCES
    
    
    1722. COSTS
    
    
    1723. NOTICES
    
    
    1824. CONFLICT WITH OTHER AGREEMENTS
    
    
    1925. WHOLE AGREEMENT
    
    
    1926. WAIVERS, RIGHTS AND REMEDIES
    
    
    2027. COUNTERPARTS
    
    
    2028. VARIATIONS
    
    
    2029. INVALIDITY
    
    
    2030. WAIVER OF RIGHT OF SET OFF
    
    
    2031. THIRD PARTY ENFORCEMENT RIGHTS
    
    
    2032. GOVERNING LAW AND JURISDICTION
    
    
    21




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CLAUSE
    
    PAGE33. GUARANTEE
    
    
    21SCHEDULE 1 SELLER WARRANTIES
    
    
    23SCHEDULE 2 LIMITATIONS ON LIABILITY
    
    
    26Limitations on Seller Liability
    
    
    26Limitations on Purchaser Liability
    
    
    28SCHEDULE 3 PURCHASER WARRANTIES
    
    
    30SCHEDULE 4 ESTIMATED AGGREGATE CASH CALL AMOUNT
    
    
    31SCHEDULE 5 CYGNUS INTERESTS CLOSING ARRANGEMENTS
    
    
    32SCHEDULE 6 EXPLORATION INTERESTS CLOSING ARRANGEMENTS
    
    
    33SCHEDULE 7 CYGNUS LICENCES AND CYGNUS INTERESTS DOCUMENTS
    
    
    34SCHEDULE 8 EXPLORATION INTERESTS AND EXPLORATION INTERESTS
DOCUMENTS
    
    
    35SCHEDULE 9 DEFINITIONS AND INTERPRETATION
    
    
    36
 AGREED FORM DOCUMENTS REFERRED TO IN THIS AGREEMENT
 Description
    
    Clause/ScheduleData room index and CD Roms
    
    Schedule 9 (Definition of Data Room)Execution Deed
    
    Schedule 9 (Definition of Assignment Documents)




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AGREEMENT
  PARTIES:
 (1)
    
    ENDEAVOUR ENERGY UK LIMITED, a company registered in England (company registration number
05030838) whose registered office is at 33rd Floor, City Point, One Ropemaker
Street, London, EC2Y 9UE (the Seller);
 (2)
    
    BAYERNGAS E & P LIMITED, a company registered in England (company registration number
04969335) of Genesis House, 1&2 The Grange, High Street, Westerham, Kent TN16 1AH (the
Purchaser); and
 (3)
    
    BAYERNGAS UK LIMITED, a company registered in England (company registration number 05088411)
of Genesis House, 1&2 The Grange, High Street, Westerham, Kent TN16 1AH (the Purchasers
Parent),
 parties party
  Whereas:
 (A)
    
    The Seller wishes to sell and the Purchaser wishes to buy the Cygnus Interests on the terms
and conditions set out herein.
 (B)
    
    The Seller has submitted an application for the Exploration Blocks to the Secretary of State
pursuant to the 26th Licensing Round. In the event that the Seller is awarded any
of the Exploration Blocks then the Seller wishes to sell and the Purchaser wishes to buy the
Exploration Interests relating to such Exploration Blocks on the terms and conditions set out
herein.
 (C)
    
    The Purchasers Parent has entered into this Agreement for the purpose of guaranteeing the
obligations of the Purchaser in accordance with clause 33.
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IT IS AGREED:
 1. Sale and Purchase
   2. Price
 Base Price Consideration
 Adjustment
 Final Closing Statement
   2




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3. Cygnus Interests Conditions Precedent
  (a)
    
    the Secretarys written consent to the assignment of the Cygnus Interests and the transaction
contemplated by this Agreement being obtained, in form and substance reasonably acceptable to
the Seller and the Purchaser; and
 (b)
    
    all necessary written consents, approvals or waivers as the case may be by the Relevant Third
Parties in relation to the transfer of the Cygnus Interests being obtained, in form and
substance reasonably acceptable to the Seller and the Purchaser, and the execution of the
Assignment Documents relating to the Cygnus Interests by such Relevant Third Parties (other
than the Secretary).
   Cygnus Interests
Closing Extension Period
 (a)
    
    satisfied prior to the expiry of the Cygnus Interests Closing Extension Period, the parties
shall proceed to Cygnus Interests Closing; or
 (b)
    
    not satisfied prior to the expiry of the Cygnus Interests Closing Extension Period, this
Agreement shall terminate without prejudice to any accrued rights the parties may have arising
from any prior breach of the terms of this Agreement save that the Surviving Provisions shall
continue in full force and effect.
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4. Interim Period
  (a)
    
    (having notified the Purchaser in advance of the subject matter thereof and acting in
accordance with Good Industry Practice and subject to the terms of the Interests Documents)
consult with the Purchaser and, where reasonably practicable, take into account any reasonable
requests or directions of the Purchaser in relation to any material decision in connection
with the Cygnus Interests and on any resolutions submitted to meetings of the Operating
Committee (as defined in the Joint Operating Agreement for the Cygnus Licences);
 (b)
    
    not (by act or omission) breach in any material respect any of the provisions of the Cygnus
Interest Documents (and shall notify the Purchaser in a timely manner of any facts or
circumstances of which it is aware which indicate that there has been such a material breach
by any other party or that such a material breach by the Seller has occurred);
 (c)
    
    not enter into or become party to any new licences, operating agreements, farm-in or farm-out
agreements, unitisation agreements, transportation agreements, oil or gas sale or supply
agreements or any other agreement or undertaking (by whatever name called) in relation to or
affecting the Cygnus Interests or trade, relinquish, surrender, sell, assign or amend the
Cygnus Interests (or agree to do any of the foregoing in the future) without the prior written
approval of the Purchaser (not to be unreasonably withheld or delayed) save as contemplated by
this Agreement and/or to the extent required by legislation or Government regulation;
 (d)
    
    continue to carry on its activities in relation to the Cygnus Interests in all respects in
the ordinary and usual course of business and comply with previously agreed decisions of the
operating committees in relation to the Cygnus Interests and any Cygnus Interests Documents to
which it is a party and the CGG Agreement;
 (e)
    
    not approve any work programme, budget, expenditure or capital commitment relating to the
Cygnus Interests involving expenditure in excess of one hundred thousand Pounds (£100,000)
(Sellers share) in any case other than:
 (i)
    
    any such expenditure as is covered by any budget approved and
disclosed in writing to the Purchaser prior to the date of this Agreement; or(ii)
    
    any such expenditure in respect of which the Purchaser has given
its prior written approval (not to be unreasonably withheld or delayed); or(iii)
    
    any expenditure necessitated by any emergency (in which case the
Seller shall consult with the Purchaser to the extent practicable in the
circumstances and, where reasonably practicable, take into account any
reasonable requests or directions of the Purchaser);
 (f)
    
    conduct its affairs regarding the Cygnus Interests (and, to the extent within its reasonable
control, operations thereunder) in accordance with Good Industry Practice;
 (g)
    
    keep the Purchaser fully informed in a timely manner on any and all matters (not of a routine
nature) relating to the Cygnus Interests;
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(h)
    
    not do or omit to do anything which would result in a breach of any of the Warranties given
by it if such Warranties were repeated at Cygnus Interests Closing;
 (i)
    
    not, except without the prior written approval of the Purchaser (such approval not to be
unreasonably withheld or delayed), amend or agree to amend any of the Cygnus Interest
Documents in any respect in so far as such amendment or agreement to amend relates to or
affects the Cygnus Interests or waive or agree to waive any of its rights or remedies
thereunder or arising therefrom in so far as such rights and remedies relate to the Cygnus
Interests;
 (j)
    
    co-operate with the Purchaser so as to ensure an efficient handover of the Cygnus Interests
on the Cygnus Interests Closing Date;
 (k)
    
    not propose, approve or participate in any sole risk operations in respect of the Cygnus
Interests;
 (l)
    
    immediately notify the Purchaser in writing of any matter or proposal that may: (i) have a
material adverse effect on the value of the Cygnus Interests; (ii) constitute a breach of a
Warranty set out in Schedule 1 (as if such Warranty was repeated continuously throughout the
Interim Period); or (iii) be materially inconsistent with information set out in the
Disclosure Letter, and consult with the Purchaser in relation to that matter or proposal and
take account of any reasonable requests or directions of the Purchaser;
 (m)
    
    to the extent practicable, consult with the Purchaser in relation to any matter requiring its
vote under the Joint Operating Agreement or any other operating agreement relating to the
Cygnus Interests and, where reasonably practicable, take account of the Purchasers reasonable
requests or directions; and
 (n)
    
    not dispose of or grant any Encumbrance in respect of any or all parts of the Cygnus
Interests.
 5. Cygnus Interests Closing
 th Cygnus Interests Closing Date
   (a)
    
    require the Cygnus Interests Closing to take place so far as practicable having regard to the
defaults which have occurred; or
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(b)
    
    fix a new date for the Cygnus Interests Closing (being not more than ten (10) Business Days
after the original date proposed for Cygnus Interests Closing) in which case the provisions of
this clause 5 (other than this clause 5.3) and Schedule 5 shall apply to the Cygnus Interests
Closing as so deferred but on the basis that such deferral may only occur once.
  6. Post Cygnus Interests Closing Adjustments
   (a)
    
    all cash calls, advances and other payments made by (or on behalf of) the Seller in respect
of the Cygnus Interests under any of the Cygnus Interest Documents and pursuant to the CGG
Agreement to the extent it has been assigned to the Purchaser on terms acceptable to the
Purchaser and Seller (but excluding payments made pursuant to the insurance arrangements and,
for the avoidance of doubt, the CGG Agreement to the extent it has not been so assigned) on or
after the Effective Date which relate to expenditure incurred between the Effective Date and
the Cygnus Interests Closing Date; plus
 (b)
    
    any amounts owing to, or pre-paid or overpaid by (or on behalf of) the Seller in respect of
the Interests under any of the Cygnus Interest Documents before the Effective Date which have
not been paid or repaid to the Seller at the Cygnus Interests Closing Date; less
 (c)
    
    the sum of:
 (i)
    
    the Estimated Aggregate Cash Call Amount;(ii)
    
    all cash calls, advances and other payments made by (or on behalf
of) the Seller in respect of the Cygnus Interests under any of the Cygnus
Interest Documents on or after the Effective Date which relate to expenditure
incurred before the Effective Date;(iii)
    
    any amounts owed, unpaid or underpaid by (or on behalf of) the
Seller in respect of the Interests under any of the Cygnus Interest Documents
before the Effective Date which have not been paid by the Seller at the Cygnus
Interests Closing Date; and(iv)
    
    any amounts received and retained without claim by the Seller
under the Cygnus Interest Documents on or after the Effective Date in respect of
the Cygnus Interests which accrue and relate to any event arising on or after
the
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Effective Date excepting those amounts which are the subject of clauses 6.2(a) and
6.2(b) above.
 Adjustments
  7. Exploration Interests Conditions Precedent
  (a)
    
    the Seller having been awarded all or part of the Exploration Blocks by the Secretary no
later than 31 March 2011;
 (b)
    
    Cygnus Interests Closing having occurred;
 (c)
    
    the Secretarys written consent to the assignment of the Exploration Interests and the
transaction contemplated by this Agreement being obtained, in form and substance reasonably
acceptable to the Seller and the Purchaser; and
 (d)
    
    all necessary written consents, approvals or waivers as the case may be by the Relevant Third
Parties in relation to the transfer of the Exploration Interests being obtained (including,
without limitation, waivers by any Relevant Third Parties of any and all pre-emptive rights
that it may have to the Exploration Interests), in form and substance reasonably acceptable to
the Seller and the Purchaser, and the execution of the Assignment Documents relating to the
Exploration Interests by such Relevant Third Parties (other than the Secretary).
   7




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Exploration Interests
Closing Extension Period
 (a)
    
    satisfied prior to the expiry of the Exploration Interests Closing Extension Period, the
parties shall proceed to Exploration Interests Closing; or
 (b)
    
    not satisfied prior to the expiry of the Exploration Interests Closing Extension Period, this
Agreement shall terminate without prejudice to any accrued rights the parties may have arising
from any prior breach of the terms of this Agreement save that the Surviving Provisions shall
continue in full force and effect.
 8. Exploration Interests Closing
 Exploration Interests Closing Date
   (a)
    
    require the Exploration Interests Closing to take place so far as practicable having regard
to the defaults which have occurred; or
 (b)
    
    fix a new date for the Exploration Interests Closing (being not more than ten (10) Business
Days after the original date for Exploration Interests Closing) in which case the provisions
of this clause 8 (other than this clause 8.3) and Schedule 6 shall apply to the Exploration
Interests Closing as so deferred but on the basis that such deferral may only occur once.
  8




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9. Seller Warranties
     (a)
    
    the amount, quality or deliverability of hydrocarbons, or other reserves attributable to the
Interests;
 (b)
    
    any geological, geophysical, technical, engineering (including petroleum engineering),
economic or other data, designs, drawings, maps, models, interpretations, forecasts or
evaluations;
 (c)
    
    any geological formation, drilling prospect or hydrocarbon reserves;
 (d)
    
    the repair, condition, working order, fitness for purpose or future performance or capability
of any property, plant or equipment forming part of or relating to the Interests; and
 (e)
    
    the amount, nature or timing of Decommissioning Liabilities and Environmental Liabilities.
  9




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10. Purchaser Warranties
  11. Indemnities
 Obligations Benefits
   (a)
    
    if any Obligations (irrespective of whether the invoice or notification relating to such
Obligations is received before or after the Effective Date) are incurred by the Seller in
respect of any period on or after the Effective Date, the Purchaser shall reimburse and
indemnify the Seller in respect thereof;
 (b)
    
    if any Obligations (irrespective of whether the invoice or notification relating to such
Obligations is received before or after the Effective Date) are incurred by the Purchaser in
respect of any period prior to the Effective Date, the Seller shall reimburse and indemnify
the Purchaser in respect thereof;
 (c)
    
    if any Benefits (irrespective of whether notification of such Benefits is received before or
after the Effective Date) accrue to the Seller in respect of any period on or after the
Effective Date, the Seller shall account to and reimburse the Purchaser in respect thereof;
and
 (d)
    
    if any Benefits (irrespective of whether notification of such Benefits is received before or
after the Effective Date) accrue to the Purchaser in respect of any period prior to the
Effective Date, the Purchaser shall account to and reimburse the Seller in respect thereof.
  10




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12. Conduct of Purchaser Claims
 Third Party
Claim
 (a)
    
    promptly (and in any event within five (5) Business Days of becoming aware of it) give notice
of the Third Party Claim or other matter or circumstance to the Seller and ensure that the
Seller and its representatives are given all reasonable information and facilities to
investigate it;
 (b)
    
    not (and ensure that each member of the Purchaser Group shall not) admit liability or make
any agreement or compromise in relation to the Third Party Claim without prior written
approval of the Seller (not to be unreasonably withheld or delayed);
 (c)
    
    (subject to the Purchaser or the relevant member of the Purchaser Group being indemnified by
the Seller against all reasonable out of pocket costs and expenses incurred in respect of that
Third Party Claim) ensure that it and each member of the Purchaser Group shall:
 (i)
    
    take such action as the Seller may reasonably request to avoid,
resist, dispute, appeal, compromise or defend the Third Party Claim;(ii)
    
    allow the Seller (if it elects to do so) to take over the conduct
of all proceedings and/or negotiations arising in connection with the Third
Party Claim; and(iii)
    
    provide such information and assistance as the Seller may
reasonably require in connection with the preparation for and conduct of any
proceedings and/or negotiations relating to the Third Party Claim.
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13. Conduct of Seller Claims
  (a)
    
    promptly (and in any event within five (5) Business Days of becoming aware of it) give notice
of the Third Party Claim or other matter or circumstance to the Purchaser and ensure that the
Purchaser and its representatives are given all reasonable information and facilities to
investigate it;
 (b)
    
    not (and ensure that each member of the Seller Group shall not) admit liability or make any
agreement or compromise in relation to the Third Party Claim without prior written approval of
the Purchaser (not to be unreasonably withheld or delayed);
 (c)
    
    (subject to the Seller or the relevant member of the Seller Group being indemnified by the
Purchaser against all reasonable out of pocket costs and expenses incurred in respect of that
Third Party Claim) ensure that it and each member of the Seller Group shall:
 (i)
    
    take such action as the Purchaser may reasonably request to avoid, resist,
dispute, appeal, compromise or defend the Third Party Claim;(ii)
    
    allow the Purchaser (if it elects to do so) to take over the
conduct of all proceedings and/or negotiations arising in connection with the
Third Party Claim; and(iii)
    
    provide such information and assistance as the Purchaser may
reasonably require in connection with the preparation for and conduct of any
proceedings and/or negotiations relating to the Third Party Claim.
 14. No Rights of Rescission or Termination
   15. Tax
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Charging Party
    13




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16. Insurance
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17. Payments
     18. Announcements
   19. Confidentiality
  (a)
    
    Confidential Informationmeans:
 (i)
    
    (in relation to the obligations of the Purchaser) any information
received or held by the Purchaser (or any of its Representatives) relating to
the Seller Group or, prior to the Cygnus Interests Closing, the Cygnus Interests
or, prior to the Exploration Interests Closing, the Exploration Interests; or(ii)
    
    (in relation to the obligations of the Seller) any information
received or held by the Seller (or any of its Representatives) relating to the
Purchaser Group or, following the Cygnus Interests Closing, the Cygnus Interests
or, following the Exploration Interests Closing, the Exploration Interests; and(iii)
    
    information relating to the provisions of, and negotiations
leading to, this Agreement and the other Transaction Documents,
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and includes written information and information transferred or obtained orally, visually,
electronically or by any other means; and
 (b)
    
    Representativesmeans, in relation to a party, its respective Affiliates and the directors,
officers, employees, agents, advisors, accountants and consultants of that party and/or of its
respective Affiliates and any banks or financial institutions proposing to provide financing
to the Purchaser relating to the Transaction.
   (a)
    
    disclosure is required by law or by any stock exchange or any regulatory, governmental or
antitrust body (including any tax authority) having applicable jurisdiction (provided that the
disclosing party shall give written notice to the other party as soon as is reasonably
practicable prior to such disclosure and take into account the reasonable comments of the
other party);
 (b)
    
    disclosure is of Confidential Information which was lawfully in the possession of that party
or any of its Representatives (in either case as evidenced by written records) without any
obligation of secrecy prior to its being received or held;
 (c)
    
    disclosure is of Confidential Information which has previously become publicly available
other than through that partys fault (or that of its Representatives); or
 (d)
    
    disclosure is required for the purpose of any arbitral or judicial proceedings arising out of
this Agreement (or any other Transaction Document).
   (a)
    
    return to the Seller all written documents and other materials relating to the Seller, the
Interests or this Agreement (including any Confidential Information and all copies of
Confidential Information in its possession) which the Seller (or its Representatives) have
provided to the Purchaser (or its Representatives);
 (b)
    
    destroy all information or other documents derived from such Confidential Information; and
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(c)
    
    so far as it is practicable to do so, expunge such Confidential Information from any
computer, word processor or other device.
   (a)
    
    Confidential Information that is required to be retained by the Purchaser by law,
governmental order, decree, regulation or rule by any relevant stock exchange regulations; or
 (b)
    
    Confidential Information which has been automatically backed up on the computer systems of
the Purchaser or of any person to whom the Confidential Information has been disclosed in
accordance with this clause 19. To the extent that such computer back up procedures create
copies of the Confidential Information, the Purchaser and/or such persons, as appropriate, may
retain such copies for the period they normally archive backed up computer records.
 20. Assignment
   21. Further Assurances
   22. Costs
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23. Notices
   Seller
    
    Address:
    
    Fax:For the attention of:
    
    Endeavour International Corporation
    
    +1 713 307 8793William L Transier
    
    1001 Fannin Street, Suite 1600Houston, Texas 77002United StatesCopy to:
    
    33rd Floor
    
    +44 20 7451 2352Carl Grenz
    
    City PointOne Ropemaker StreetLondon EC2Y 9UEUnited KingdomCopy to:
    
    Freshfields Bruckhaus Deringer LLP
    
    +44 20 7832 7001Jonathan Rees/
    
    65 Fleet StreetGraham Watson
    
    London EC4Y 1HSUK
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Purchaser andPurchasers Guarantor
    
    Address:
    
    Fax:For the attention of:
    
    Bayerngas E&P Limited and
    
    +44 1959 567459Gerry Harrison
    
    Bayerngas UK LimitedGenesis House1 & 2 The GrangeHigh StreetWesterhamKent TN16 1AHUnited KingdomCopy to:
    
    Watson Farley & Williams LLP
    
    +44 20 7814 8141Chris Kilburn
    
    15 Appold StreetLondonEC2A 2HB
 24. Conflict with other Agreements
  25. Whole Agreement
  (a)
    
    no party shall have any claim or remedy in respect of any statement, representation, warranty
or undertaking made by or on behalf of the other party (or any of its Connected Persons) in
relation to the Proposed Transaction which is not expressly set out in this Agreement or any
other Transaction Document;
 (b)
    
    any terms or conditions implied by law in any jurisdiction in relation to the Proposed
Transaction are excluded to the fullest extent permitted by law or, if incapable of exclusion,
any right, or remedies in relation to them are irrevocably waived;
 (c)
    
    the only right or remedy of a party in relation to any provision of this Agreement or any
other Transaction Document shall be for breach of this Agreement or the relevant Transaction
Document; and
 (d)
    
    except for any liability in respect of a breach of this Agreement or any other Transaction
Document, no party (or any of its Connected Persons) shall owe any duty of care or have any
liability in tort or otherwise to the other party (or its respective Connected Persons) in
relation to the Proposed Transaction,
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Connected Persons
 26. Waivers, Rights and Remedies
  27. Counterparts
  28. Variations
  29. Invalidity
  30. Waiver of Right of Set Off
  31. Third Party Enforcement Rights
  20




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32. Governing Law and Jurisdiction
   33. Guarantee
   (a)
    
    any amendment, variation or assignment of this Agreement or any Transaction Document or any
waiver of its or their terms;
 (b)
    
    any full or partial release of, or granting of time or other indulgence to, the Purchaser or
any third party;
 (c)
    
    any winding up, dissolution, reconstruction, legal limitation, incapacity or lack of
corporate power or authority or other circumstances affecting the Purchaser or the Seller (or
any act taken by the Seller or the Purchaser in relation to any such event); or
 (d)
    
    any other act, event, neglect or omission (whether or not known to the Purchaser, the Seller
or the Purchasers Parent) which would or might (but for this clause) operate to impair or
discharge the Purchasers Parents liability or afford the Purchasers Parent or the Purchaser
any legal or equitable defence,
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22




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SCHEDULE 1
 SELLER WARRANTIES
 1.
 2.
 3.
 4.
 5.
 6.
 7.
 8.
 9.
 10.
 23




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11.
 12.
 13.
 14.
 15.
 16.
 17.
 18.
 19.
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20.
 21.
 22.
 23.
 24.
 25.
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SCHEDULE 2
 LIMITATIONS ON LIABILITY
 Limitations on Seller Liability
 1. Time Limits
 2. Thresholds for Claims
 (a)
    
    unless the amount of the liability pursuant to that single Claim exceeds five hundred
thousand Dollars ($500,000); and
 (b)
    
    unless the aggregate amount of the liability of the Seller for all Claims not excluded by sub
paragraph (a) exceeds two per cent (2%) of the Consideration.
 3. Maximum limit for Claims
 4. Maximum limit for indemnity claims.
 5. Claim to be withdrawn unless litigation commenced
 6. Matters disclosed
 7. Contingent liabilities
 8. No liability for claims arising from acts or omissions of Purchaser
 (a)
    
    after the Cygnus Interests Closing by the Purchaser or any member of the Purchaser Group (or
its respective directors, employees or agents or successors in title); or
 (b)
    
    before the Cygnus Interests Closing by any member of the Seller Group at the direction or
request of the Purchaser or any member of the Purchaser Group,
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9. Purchasers duty to mitigate
 10. Recovery from third party after payment from Seller
 11. Insured Claims.
 12. Net financial benefit
 13. No liability for legislation or changes in rates of tax
 14. No double recovery
 15. Consequential loss
 16. Purchasers knowledge
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17. Seller to have opportunity to remedy breaches
 18. Separation of Warranties
 Limitations on Purchaser Liability
 1. Maximum limit for indemnity claims.
 2. Claim to be withdrawn unless litigation commenced
 3. Contingent liabilities
 4. No liability for claims arising from acts or omissions of Seller
 (a)
    
    after the Cygnus Interests Closing by the Purchaser or any member of the Purchaser Group (or
its respective directors, employees or agents or successors in title); or
 (b)
    
    before the Cygnus Interests Closing by any member of the Seller Group at the direction or
request of the Purchaser or any member of the Purchaser Group,
  5. Sellers duty to mitigate
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6. Recovery from third party after payment from Purchaser
 7. Net financial benefit
 8. No double recovery
 9. Consequential loss
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SCHEDULE 3
 PURCHASER WARRANTIES
 1.
 2.
 3.
 4.
 5.
 30




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##### 



SCHEDULE 4
 ESTIMATED AGGREGATE CASH CALL AMOUNT
      31




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##### 



SCHEDULE 5
 CYGNUS INTERESTS CLOSING ARRANGEMENTS
 1.
 (a)
    
    such documents as the Purchaser may reasonably require to complete the sale and purchase of
the Cygnus Interests;
 (b)
    
    an original or certified copy of all necessary written consents, approvals or waivers, as the
case may be, by the Relevant Third Parties in relation to the transfer by the Seller to the
Purchaser of the Cygnus Interests in form and substance reasonably acceptable to the Seller
and the Purchaser;
 (c)
    
    an original or certified copy of the Assignment Documents relating to the Cygnus Interests
duly executed by the Relevant Third Parties (other than the Secretary) and the Seller;
 (d)
    
    a certified copy of the Secretarys consent to the assignment of the Cygnus Licences;
 (e)
    
    an original of the Disclosure Letter signed by the Seller;
 (f)
    
    a certified copy of the written resolution of the Sellers directors authorising the
execution of this Agreement and any other document which the Seller is required to execute
pursuant to this Agreement; and
 (g)
    
    a certified copy of any power of attorney or other instrument under which this Agreement and
any other document which the Seller is required to executed pursuant to this Agreement is
executed on behalf of the Seller.
 2.
 32




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##### 



SCHEDULE 6
 EXPLORATION INTERESTS CLOSING ARRANGEMENTS
  (a)
    
    such documents as the Purchaser may reasonably require to complete the sale and purchase of
the Exploration Interests;
 (b)
    
    a copy of all necessary written consents, approvals or waivers, as the case may be, by the
Relevant Third Parties in relation to the transfer by the Seller to the Purchaser of the
Exploration Interests in form and substance reasonably acceptable to the Seller and the
Purchaser;
 (c)
    
    the Assignment Documents duly executed by the Relevant Third Parties (other than the
Secretary) and the Seller;
 (d)
    
    a copy of the Secretarys consent to the assignment of the Exploration Licences;
 (e)
    
    a certified copy of the written resolution of the Sellers directors authorising the
execution of this Agreement and any other document which the Seller is required to execute
pursuant to this Agreement; and
 (f)
    
    a certified copy of any power of attorney or other instrument under which this Agreement and
any other document which the Seller is required to executed pursuant to this Agreement is
executed on behalf of the Seller.
 33




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SCHEDULE 7
 CYGNUS LICENCES AND CYGNUS INTERESTS DOCUMENTS
 Part A The Cygnus Licences
 Licence
    
    
    Block
    
    EquityP.1055
    
    
    44/11a & 44/12a
    
    
    12.50
    %P.1437
    
    
    44/13a
    
    
    25.00
    %P.1731
    
    
    44/11b & 44/12b
    
    
    17.24
    %
 Part B Cygnus Interests Documents
 P.1055
 1.
 2.
 P.1437
 1.
 2. th
 P.1731
 1.
 2. th
 34




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##### 



SCHEDULE 8
 EXPLORATION INTERESTS AND EXPLORATION INTERESTS DOCUMENTS
 Part A The Exploration Blocks
 Block
    
    Equity44/14
    
    
    20
    %44/15
    
    
    20
    %44/16a
    
    
    20
    %44/17d
    
    
    20
    %44/17f
    
    
    20
    %
 Part B The Exploration Interest Documents
 th
 35




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##### 



SCHEDULE 9
 DEFINITIONS AND INTERPRETATION
 1. Definitions
 Adjustments
 Affiliate
 Agreed Form
 Agreement
 Assignment Documents
 Benefits
 Block
 Business Day
 CGG Agreement
 Claim
 Connected Persons
 Consideration
 Cygnus Interests Closing
 Cygnus Interests Closing Date
 Cygnus Interests Documents
 Cygnus Interests
 36




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##### 



(a)
    
    the Sellers undivided legal and beneficial interest in each Cygnus Licence;(b)
    
    the Sellers entire interest in and under the Joint Operating Agreement in relation to each
Cygnus Licence; and(c)
    
    the Sellers entire interest in the Cygnus Interests Documents,
  Cygnus Licence
 Data Room
 Decommissioning Liabilities
 Default Interest Rate
 Disclosure Letter
 Dollars $
 Effective Date
 Encumbrances
 Environment
 Environmental Laws
 Environmental Liabilities
 37




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##### 



Environmental Matters
 Environmental Warranty
 Estimated Aggregate Cash Call Amount
 Exploration Blocks
 Exploration Interests
 (a)
    
    the Sellers undivided legal and beneficial interest in each Exploration Block; and(b)
    
    the Sellers entire interest in the Exploration Interests Documents,
  Exploration Interests Closing
 Exploration Interests Closing Date
 Exploration Interests Documents
 Final Closing Statement
 Good Industry Practice
 Governmental Entity
 Information Memorandum
 Interests
 38




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##### 



Interests Documents
 Interim Period
 Joint Operating Agreement rd
 LIBOR
 Month
 Obligations
 parent company
 Petroleum
 Pounds £ Sterling
 Proposed Transaction
 Purchaser Group
 Purchasers Bank Account
 Relevant Third Parties
 Repeated Warranties
 Representatives
 Secretary
 Sellers Account
 Intermediary:JP Morgan Chase Bank NA New YorkSWIFT BIC:
    
    CHASUS33Account:
    
    0010962009
 39




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##### 



JP Morgan Chase Bank NA LondonBeneficiary Bank:JP Morgan Chase Bank NA LondonSWIFT BIC:
    
    CHASGB2LAccount:
    

    35047502IBAN:
    
    GB49CHAS60924235047502Account Reference:
    
    Endeavour Energy UK Limitedand in relation to payments in Pounds:JP Morgan Chase Bank NASort Code:
    
    60-92-42Account:
    
    35047501Account Reference:
    
    Endeavour Energy UK Limited
  Seller Group
 Status Warranties
 subsidiary subsidiaries
 Surviving Provisions
 Taxation
 (a)
    
    UK corporation tax, VAT and any other forms of taxation, duties, levies, imposts, charges,
stamp on transaction tax or withholdings similar to or supplementing or replacing the
foregoing or any of them; and(b)
    
    all penalties, charges, interest, fines, costs and expenses, loss of relief, allowance or
credit relating to any form of, or claim for, taxation or other imposition referred to in
paragraph (a);
 Third Party Claim
 Title Warranties
 Transaction Documents
 VAT
 Warranties
 40




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##### 



2. Interpretation
 (a)
    
    references to a personinclude any individual, firm, body corporate (wherever incorporated),
government, state or agency of a state or any joint venture, association, partnership, works
council or employee representative body (whether or not having separate legal personality);(b)
    
    headings do not affect the interpretation of this Agreement; the singular shall include the
plural and vice versa; and references to one gender include all genders;(c)
    
    references to any English legal term or concept shall, in respect of any jurisdiction other
than England, be construed as references to the term or concept which most nearly corresponds
to it in that jurisdiction;(d)
    
    references to US dollars or US$ or $ are references to the lawful currency from time to time
of the United States of America;(e)
    
    for the purposes of applying a reference to a monetary sum expressed in sterling, an amount
in a different currency shall be deemed to be an amount in US dollars translated at the
Exchange Rate at the relevant date (which in relation to a Claim, shall be the date of the
receipt of notice of that Claim under Schedule 2);(f)
    
    any statement in this Agreement qualified by the expression so far as the Seller is aware or
to the best of the Sellers knowledgeor any similar expression shall be deemed only to be
made on the basis of the actual knowledge, at the date of this Agreement, of Bruce Stover,
Mike Kirksey, Carl Grenz, John Williams, Bob Thompson and Andrew Sheu and shall carry no
requirement to make enquiries of any other person; and(g)
    
    any phrase introduced by the terms including, include, in particular or any similar
expression shall be construed as illustrative and shall not limit the sense of the words
preceding those terms.
 3. Enactments
 4. Schedules
 5. Inconsistencies
 41




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##### 



SIGNATURE
  SIGNED
for and on behalf of
    
    
    )
)
    
    
    SIGNATURE:
    
    
    
    /s/ William L. TransierENDEAVOUR ENERGY UK
    
    
    )LIMITED
    
    
    )
    
    
    NAME:
    
    
    
    William L. TransierSIGNED
    
    
    )
    
    
    SIGNATURE:
    
    
    
    /s/ G. M. Harrisonfor and on behalf of
    
    
    )BAYERNGAS E & P LIMITED
    
    
    )
    
    
    NAME:
    
    
    
    G. M. HarrisonSIGNED
    
    
    )
    
    
    SIGNATURE:
    
    
    
    /s/ G. M. Harrisonfor and on behalf of
    
    
    )BAYERNGAS UK LIMITED
    
    
    )
    
    
    NAME:
    
    
    
    G. M. Harrison
 42