<PAGE>














                                EXHIBIT 3.01
                               -------------


                      AGREEMENT OF PURCHASE AND SALE
                            DATED MARCH 19, 1999




                                    136
</Page>

<PAGE>
<TABLE>
<CAPTION>
                       AGREEMENT OF PURCHASE AND SALE

                             TABLE OF CONTENTS


<S>    <C>                                                              <C>
1.00   INTERPRETATION. . . . . . . . . . . . . . . . . . . . . . . . . . .1
       1.01    Definitions . . . . . . . . . . . . . . . . . . . . . . . .1
       1.02    Schedules . . . . . . . . . . . . . . . . . . . . . . . . .6
       1.03    References. . . . . . . . . . . . . . . . . . . . . . . . .6
       1.04    Headings. . . . . . . . . . . . . . . . . . . . . . . . . .6
       1.05    Singular/Plural . . . . . . . . . . . . . . . . . . . . . .7
       1.06    Use of Canadian Funds . . . . . . . . . . . . . . . . . . .7
       1.07    Derivatives . . . . . . . . . . . . . . . . . . . . . . . .7
       1.08    Interpretation If Closing Does Not occur. . . . . . . . . .7
       1.09    Conflicts . . . . . . . . . . . . . . . . . . . . . . . . .7
       1.10    Responsibility Extends To Legal Costs . . . . . . . . . . .7
       1.11    Knowledge or Awareness. . . . . . . . . . . . . . . . . . .7

2.00   PURCHASE AND SALE . . . . . . . . . . . . . . . . . . . . . . . . .8
       2.01    Agreement Of Purchase And Sale. . . . . . . . . . . . . . .8
       2.02    Allocation Of Purchase Price. . . . . . . . . . . . . . . .8
       2.03    Calculation Of The Initial Interest Purchase Price  . . . .8
       2.04    Payment Of Initial Interest Purchase Price. . . . . . . . .8
       2.05    Options . . . . . . . . . . . . . . . . . . . . . . . . . .9
       2.06    Purchaser's Default In Exercising Options . . . . . . . . .9
       2.07    Purchaser's Post-Closing Entitlements/obligations . . . . 10

3.00   THIRD PARTY RIGHTS AND CONSENTS . . . . . . . . . . . . . . . . . 11
       3.01    Preferential Rights of Purchase and Consents. . . . . . . 11
       3.02    Operatorship And Third Parties. . . . . . . . . . . . . . 13

4.00   PURCHASER'S REVIEW. . . . . . . . . . . . . . . . . . . . . . . . 13
       4.01    Vendor To Provide Access. . . . . . . . . . . . . . . . . 13
       4.02    Title Defects . . . . . . . . . . . . . . . . . . . . . . 13

5.00   ADJUSTMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
       5.01    No Adjustment . . . . . . . . . . . . . . . . . . . . . . 14

6.00   INTERIM PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . 14
       6.01    Assets To Be Maintained In Proper Manner. . . . . . . . . 14
       6.02    Vendor as Agent . . . . . . . . . . . . . . . . . . . . . 14
       6.03    Restrictions on Conduct of Business . . . . . . . . . . . 15

7.00   REPRESENTATIONS AND WARRANTIES OF PARTIES . . . . . . . . . . . . 15
       7.01    Vendor's Representations And Warranties . . . . . . . . . 15
       7.02    Purchaser's Representations And Warranties. . . . . . . . 18
       7.03    Survival of Representations And Warranties. . . . . . . . 19
       7.04    Limit on Vendor's Responsibility. . . . . . . . . . . . . 19
       7.05    No Additional Representations or Warranties By Vendor . . 20

8.00   LIABILITY AND INDEMNIFICATON. . . . . . . . . . . . . . . . . . . 20
       8.01    Responsibility of Purchaser . . . . . . . . . . . . . . . 20
       8.02    Environmental Indemnity . . . . . . . . . . . . . . . . . 21


                                    137
</Page>
<PAGE>

9.00   CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
       9.01    Place of Closing. . . . . . . . . . . . . . . . . . . . . 22
       9.02    Required Approvals. . . . . . . . . . . . . . . . . . . . 22
       9.03    Conditions For Benefit of Purchaser . . . . . . . . . . . 22
       9.04    Conditions For Benefit of Vendor. . . . . . . . . . . . . 23
       9.05    Waiver of Conditions. . . . . . . . . . . . . . . . . . . 24
       9.06    Failure To Satisfy Conditions . . . . . . . . . . . . . . 24

10.00  POST CLOSING ADMINISTRATION . . . . . . . . . . . . . . . . . . . 24
       10.01   Registration of Documents . . . . . . . . . . . . . . . . 24
       10.02   Coordination of Administrative Matters. . . . . . . . . . 24

11.00  CONFIDENTIALITY . . . . . . . . . . . . . . . . . . . . . . . . . 25
       11.01   Purchaser's ob1igation To Maintain Information
               Confidential. . . . . . . . . . . . . . . . . . . . . . . 25
       11.02   Consultants And Advisors Bound. . . . . . . . . . . . . . 25

12.00  ARBITRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
       12.01   Reference To Arbitration. . . . . . . . . . . . . . . . . 25
       12.02   Proceedings . . . . . . . . . . . . . . . . . . . . . . . 26

13.00  ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
       13.01   Assignments Before Closing. . . . . . . . . . . . . . . . 26
       13.02   Assignments By Purchaser After Closing. . . . . . . . . . 26

14.00  NOTICE  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
       14.01   Service of Notice . . . . . . . . . . . . . . . . . . . . 26
       14.02   Addresses For Notices . . . . . . . . . . . . . . . . . . 27
       14.03   Right To Change Address . . . . . . . . . . . . . . . . . 27

15.00  PUBLIC ANNOUNCEMENTS. . . . . . . . . . . . . . . . . . . . . . . 27
       15.01   Approval Required for Press Releases. . . . . . . . . . . 27
       15.02   Signs And Notification To Governmental Agencies . . . . . 28

16.00  MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . . . . . . . . 28
       16.01   Further Assurances. . . . . . . . . . . . . . . . . . . . 28
       16.02   Governing Law . . . . . . . . . . . . . . . . . . . . . . 28
       16.03   Time. . . . . . . . . . . . . . . . . . . . . . . . . . . 28
       16.04   No Amendment Except In Writing. . . . . . . . . . . . . . 28
       16.05   Waiver Must Be In Writing . . . . . . . . . . . . . . . . 29
       16.06   Consequences Of Termination . . . . . . . . . . . . . . . 29
       16.07   Supersedes Earlier Agreements . . . . . . . . . . . . . . 29
       16.08   No Merger . . . . . . . . . . . . . . . . . . . . . . . . 29
       16.09   Substitution And Subrogation. . . . . . . . . . . . . . . 29
       16.10   Enurement . . . . . . . . . . . . . . . . . . . . . . . . 30
</TABLE>
       SCHEDULES
       Schedule" A " - Lands, Leases and Encumbrances; Production Sales
                       Contracts; Unit Agreements; Facility Agreements; Wells;
                       Authorizations for Expenditure For  Which Purchaser is
                       Responsible; Preferential Purchase Rights; Processing,
                       Treating, Transportation and Contract Operating
                       Agreements; Penalties

       Schedule  "B" - General Conveyance

       Schedule "C" - (Vendor's/Purchaser's) Officer's Certificate -
                      Representations are True

       Schedule "D" - Vendor's officer's Certificate - No Substantial
                      Damage

                                    138
</Page>
<PAGE>
                       AGREEMENT OF PURCHASE AND SALE

                           CESSFORD AREA, ALBERTA



THIS AGREEMENT made this 19th day of March, 1999.


BETWEEN:

          STARROCK RESOURCES L TD., a body corporate having an office
          in the City of Calgary, in the Province of Alberta
          (hereinafter called the "Vendor")

          - and-

          PROMAX ENERGY INC., a body corporate having an office in the
          City of Calgary , in the Province of Alberta (hereinafter
          called the "Purchaser")


WHEREAS the Vendor has agreed to sell the Assets to the Purchaser and the
Purchaser has agreed to purchase the Assets from the vendor on the terms
and conditions set forth herein;

NOW THEREFORE in consideration of the premises and the mutual covenants and
warranties herein contained, the Parties agree as follows:


     1.00 INTERPRETATION
     --------------

     1.01 Definitions
          -----------
     In this Agreement, including the recitals and the Schedules, the
     following terms shall have the respective meanings hereby assigned to
     them, subject to Subclause 3.01E:

     "Agreement" means this document, together with the Schedules attached
     hereto and made a part hereof.

     "Annual Option  Interest" means an undivided 14% interest in the
     Petroleum and Natural Gas Rights (comprising one-fifth (1/5) of the
     Option Interest) which the Purchaser may acquire in each of the first
     5 years following the Closing Date by exercise of an option pursuant
     to Clause 2.05.

     "Assets" means the Petroleum and Natural Gas Rights, the Tangibles and
     the Miscellaneous Interests.

     "Closing" means the exchange of Conveyance Documents on the Closing
     Date, the delivery by the Purchaser to the vendor of the Purchase
     Price, and the transfer of the Assets by the vendor to the Purchaser.


                                    139
</Page>

<PAGE>

     "Closing Date" means 2:00 p.m. on March 19, 1999, or such other time
     and date as may be agreed to by the Parties.

     "Conveyance Documents" means the documents described in Subparagraphs
     9.03 (e) (i) and (ii), which provide for the assignment, transfer or
     other disposition of the Assets to the Purchaser.

     "Effective Date" means 10.00 a.m. on March 19, 1999.

     "Environmental Liabilities" means any and all environmental damage,
     contamination or other environmental problem arising out of, resulting
     from, attributable to or connected with operations relating to the
     Assets, whether or not caused by a breach of applicable Regulations,
     including, without limitation, any matters related to surface,
     underground, air, groundwater or surface water contamination, the
     abandonment or plugging of any of the Wells, the restoration or
     reclamation of any part of the Assets, or the removal of or failure to
     remove any materials, substances, foundations, structures or equipment
     from the surface lands pertaining to the Assets.

     "Event of Default" means anyone of the following:

     (a)  the Purchaser fails to exercise an option granted pursuant to
          clause 2.05.

     (b)  the Purchaser commits any act of bankruptcy or insolvency; or
          files a Proposal or Notice of Intention to Make a Proposal under
          the Bankruptcy and Insolvency Act (Canada); or the Purchaser
          assigns or is petitioned into bankruptcy;  or an application
          is made concerning the Companies Creditors Arrangements Act, or
          the Purchaser takes advantage of or is otherwise involved as a
          debtor in any similar legislation governing the relationship of
          debtors and their creditors;

     (c)  the Purchaser resolves or is ordered by a court to wind-up,
          dissolve or liquidate;

     (d)  any of the Purchaser's assets or undertaking are seized or
          otherwise encumbered by virtue of any writ, judgment or order
          filed, entered or made against the Purchaser; or

     (e)  the Purchaser breaches the Purchaser's covenant contained in
          Clause 2.07B.

     "Exercise Bonus Amount" means the amount payable to the vendor
     pursuant to clause 2.05 in addition to the Annual Option Interest
     Purchase Price as additional purchase price consideration which amount
     shall be equal to the amount arrived at by calculating interest on the
     Annual Option Insurance at a rate equal to the prime commercial
     lending rate of the Main Branch in Calgary of the Canadian Imperial
     Bank of Commerce, from the Closing Date until the Annual option
     Interest Purchase Price is paid by the Purchaser to the vendor.

     "GST" means tax payable pursuant to the Excise Tax Act (Canada). The
     Vendor's GST registration Number is 893059683RT.


                                    140
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<PAGE>

     "Intia1 Interest" means all of the Tangibles, miscellaneous Interests
     and an undivided 30% interest in the Petroleum and Natural Gas Rights.

     "Initial Interest Purchase Price" means the amount payable by the
     Purchaser to the vendor for the Initial Interest pursuant to Clause
     2.03, as modified by the reductions herein.

     "Lands" means the lands set forth and described in Schedule '' A",
     insofar as rights to the Petroleum Substances underlying those lands
     are granted by the Leases.

     "Leases" means the leases, licences, permits and other documents of
     title set forth and described in  Schedule" A", by virtue of which the
     holder thereof is entitled to drill for, win, take, own or remove the
     Petroleum Substances within, upon or under the Lands or by virtue of
     which the holder thereof is deemed to be entitled to a share of
     Petroleum Substances removed from the Lands and includes, if
     applicable, all renewals and extensions of such documents and all
     documents issued in substitution therefor.

     "Miscellaneous Interests" means the Vendor's Interest in and to all
     property, assets and rights, other than the Petroleum and Natural Gas
     Rights and the Tangibles, to the extent such property, assets and
     rights pertain to the Petroleum and Natural Gas Rights or the
     Tangibles, or any rights relating thereto, including, without
     restricting the generality of the foregoing, the vendor's Interest in:


     (a) all contracts, agreements and documents, to the extent that they
     relate directly to the Petroleum Substances, the Petroleum and Natural
     Gas Rights or the Tangibles, including agreements for the
     construction, ownership and operation of any facilities and agreements
     for the sale, processing or transportation of Petroleum Substances;


     (b) all subsisting rights to enter upon, use and occupy the surface of
     any of the Lands,or any lands upon which any Tangibles are located or
     of any lands to be crossed in order to gain access to any of the Lands
     or the Tangibles;

     (c) the wellbores and casing of all Wells; and

     (d) copies of engineering  records, files, reports and data that, in
     the Vendor's reasonable judgement, relate directly to the Petroleum
     Substances, the Petroleum and Natural Gas Rights, the Wells or the
     Tangibles, excluding the Vendor's tax and financial records, economic
     evaluations and geophysical data.

     Unless otherwise agreed in writing by the Parties, however, the
     Miscellaneous Interests shall not include agreements, documents or
     data to the extent that:

     they pertain to the Vendor's proprietary technology or
     interpretations;

     (b)  they are owned or licensed by third parties with restrictions on
     their deliverability or disclosure by the Vendor to any assignee which
     is not an affiliate of the Vendor; or

     (c)  they consist of seismic records or data, whether or not owned by
     the Vendor.
                                    141
</Page>
<PAGE>

     "Option Interest" means the undivided 70% interest in the Petroleum
     and Natural Gas Rights, being the remaining interest in the Petroleum
     and Natural Gas Rights included in the Assets but not forming part of
     the Initial Interest.

     "Party" means a person, partnership or corporation which is bound by
     this Agreement.

     "Permitted Encumbrances" means:

     (a)  any encumbrances, overriding royalties, net profits interests and
          other burdens identified in Schedule "A";

     (b)  any preferential rights of purchase or any similar restriction
          applicable to any of the Assets, as identified in  Schedule" A";

     (c)  the terms and conditions of the Leases, including, without
          limitation, the requirement to pay any rentals or royalties to
          the grantor thereof to maintain the Leases in good standing and
          any gross royalty trusts applicable to the grantor's interest in
          any of the Leases;

     (d)  the right reserved to or vested in any grantor, government or
          other public authority by the term of any Lease or by the
          Regulations to terminate any Lease;

     (e)  easements, rights of way, servitudes or other similar rights in
          land, including, without in any way limiting the generality of
          the foregoing, rights of way and servitudes for highways,
          railways, sewers, drains, gas and oil pipelines, gas and water
          mains, electric light, power, telephone or cable television
          conduits, poles, wires or cables;

     (f)  rights of general application reserved to or vested in any
          governmental authority to levy taxes on Petroleum Substances or
          the income or revenue therefrom and governmental restrictions on
          production rates from wells or on operations being conducted on
          the Lands or otherwise affecting the value of any of the Assets;

     (g)  agreements for the sale of Petroleum Substances, which are
          terminable on thirty (30) days' notice or less (without an early
          termination penalty or other cost) or are identified in
          Schedule" A";

     (h)  the Regulations and any rights reserved to or vested in any
          municipality or governmental, statutory or public authority - to
          control or regulate any of the Assets in any manner;

     (i)  undetermined or inchoate liens incurred or created as security in
          favour of any person with respect to the development or operation
          of any of the Assets, as regards the Vendor's share of the costs
          and expenses thereof;

     (j)  the reservations, limitations, provisos and conditions in any
          grants or transfers from the Crown of any of the Lands or
          interests therein, and statutory exceptions to title;



                                    142
</Page>
<PAGE>

     (k)  agreements and plans relating to pooling or unitization, provided
          that any unit agreement applicable to the Lands shall be
          identified in Schedule ''A";

     (l)  the agreements, including any identified in Schedule "A"
          respecting the processing, treating or transmission of Petroleum
          Substances or the operation of wells by contract field operators;

     (m)  penalties which are disclosed in Schedule ''A", and Which have
          arisen under operating procedures or similar agreements as a
          consequence of elections by the Vendor not to participate in
          operations on the Lands to which the penalty applies;

     (n)  liens granted in the ordinary course of business to a public
          utility, municipality or governmental authority with respect to
          operations pertaining to any of the Assets; and

     (o)  mechanics', builders' or materialman's liens in respect of
          services rendered or goods supplied, but only insofar as such
          liens relate to goods or services for which payment is not due or
          the validity of which is being diligently contested by or on
          behalf of the Vendor;

          Petroleum and Natural Gas Rights" means the Vendor's Interest in
          and to the Lands, and the Leases pertaining thereto.

          "Petroleum  Substances" means petroleum, natural gas, sulphur and
          every other mineral or substance, or any of them,  the right to
          explore for which, or an interest in which, is granted pursuant
          to the Leases, insofar only as they pertain to the Lands.

          "Purchase Price" means the amount payable by the Purchaser to the
          Vendor for the Assets pursuant to Clause 2.02, as modified by the
          reductions provided for herein.

          "Regulation" means all statutes, laws, rules, orders and regulations
          in effect from time to time and made by governments or governmental
          boards or agencies having jurisdiction over the Assets.

          "Secured Assets" means all of the Unexercised Option Interest and an
          undivided percentage interest portion (equal to the Unexercised Option
          Interest) of the  Purchaser's interest now owned or after the  Closing
          Date acquired in petroleum and natural gas rights within, upon or
          underlying those lands located in Townships 23, 24, 25, 26 and Ranges
          7, 8, 9, 10, all West of the Fourth Meridian and any equipment,
          improvements, facilities, intangible rights or other assets associated
          therewith.

          "Tangibles" means the Vendor's Interest, whether leased or owned, in
          and to all tangible depreciable property, and assets that are:

          (a)  located in or on the Lands and used, or intended for use, in
               connection with production, processing, gathering, storage,
               treatment or transportation operations relating to the Petroleum
               Substances and the Petroleum and Natural Gas Rights, including,
               without limitation, the well equipment, if  any, relating to the
               Wells; and

                                    143
</Page>
<PAGE>


          (b)  any additional items, whether located on or off the Lands, that
               are indicated in Schedule " A '' to be specifically included as
               Tangibles.

          "Title Defect" means a defect, deficiency or discrepancy in or
          affecting the title of the Vendor in and to any of the Assets, other
          than as specifically disclosed herein or in Schedule "A", which is
          sufficiently material and adverse to the enforcement of title that it
          would not be acceptable to a knowledgeable, prudent purchaser buying
          similar oil and gas properties, acting reasonably.

          "Unexercised Option Interest" means the undivided percentage interest
          portion of the Option Interest which has not been acquired by the
          Purchaser through its exercise of the options pursuant to Clause 2.05.

          "Vendor's Interest" means, in respect of a particular  property, right
          or asset, the undivided interest of the Vendor in the Petroleum and
          Natural Gas Rights described as "Vendor's Interest" in Schedule " A "
          and a corresponding interest in the Tangibles and Miscellaneous
          Interests.

          "Wells" means all producing, shut-in, water source, disposal,
          injection, suspended, abandoned and similar wells located on the Lands
          including the wells described in Schedule "A".

1.02 Schedules
     ---------
          The following Schedules are attached hereto and made part of this
          Agreement:

          (a)  Schedule "A", which includes: Part I - Lands, Leases and
               Encumbrances, Part II - Production Sales Contracts, Part III -
               Unit Agreements, Part IV   Facility Agreements, Part  V- Wells
               and Gathering System, Part VI - Authorizations for Expenditure,
               Part VII-Preferential Purchase Rights, Part VIII - Processing,
               Treating, Transportation and Contract Operating Agreements, Part
               IX- Penalties;

          (b)  Schedule "B", which is the form of General  Conveyance;

          (c)  Schedule "C", which is the form of the certificate to be provided
               pursuant to Article  9.00 with respect to the truth of a Party's
               representations and warranties; and

          (d)  Schedule "D", which is the form of the certificate to be provided
               pursuant to Article 9.00 with respect to the belief of the Vendor
               that there has been no substantial damage or alteration to the
               Assets.


                                    144
</Page>
<PAGE>

1.03 References
     ----------
     The references "hereunder", "herein" and "hereof' refer to the
     provisions of this Agreement, and references to Articles, Clauses,
     Subclauses, Paragraphs or Subparagraphs herein refer to Articles,
     Clauses, Subclauses, Paragraphs or Subparagraphs of this Agreement.
     Any reference to time shall refer to Mountain Standard Time or
     Mountain Daylight Savings Time during the respective intervals in
     which each is in force.

1.04 Headings
     --------
     The headings of the Articles, Clauses, Schedules and any other
     headings, captions or indices herein are inserted. for convenience of
     reference only and shall not be used in any way in construing or
     interpreting any provision hereof

1.05 Singular/Plural
     ---------------
     Whenever the singular or masculine or neuter is used in this Agreement
     or in the Schedules, it shall be interpreted as meaning the plural or
     feminine or body politic or corporate, and vice versa, as the context
     requires.

1.06 Use of Canadian Funds
     ---------------------
     All references to "dollars" or "$" herein shall refer to lawful
     currency of Canada.

1.07 Derivatives
     -----------
     Where a term is defined herein, a capitalized derivative of such term
     shall have corresponding meaning unless the context otherwise
     requires.

1.08 Interpretation If Closing Does Not Occur
     ----------------------------------------
     In the event that Closing does not occur, each provision of this
     Agreement which presumes that the Purchaser has acquired the Assets
     hereunder shall be construed as having been contingent upon Closing
     having occurred.

1.09 Conflict
     --------
     If there is any conflict or inconsistency between a provision of the
     body of this  Agreement and that of a Schedule or a Conveyance
     Document, the provision of the body of this Agreement shall prevail.
     If any term or condition of this Agreement conflicts with a term or
     condition of a Lease or the Regulations, the term or condition of such
     Lease or the Regulations shall prevail, and this Agreement shall be
     deemed to be amended to the extent required to eliminate any such
     conflict.

1.10 Responsibility Extends To Legal Costs
     -------------------------------------
     References to costs in the liability and indemnification obligations
     prescribed in this Agreement shall be deemed to include reasonable
     legal costs on a solicitor-client basis.


                                    145
</Page>

<PAGE>

1.11 Knowledge of Awareness
     ----------------------
     Where a representation or warranty in this Agreement is made on the
     basis of the knowledge or awareness of the Vendor, such knowledge or
     awareness consists only of the actual knowledge or awareness of the
     current officers and senior supervisory personnel of the Vendor and
     does not include knowledge or awareness of any other person or
     persons.

2.00 PURCHASE AND SALE
     -----------------

2.01 Agreement of Purchase and Sale
     ------------------------------
     The Purchaser agrees to purchase all of the Initial Interest from the
     vendor and the Vendor agrees to sell all of the Initial Interest to
     the Purchaser on the terms and conditions set forth herein. The
     Purchaser will have the right to acquire from the Vendor additional
     interests in the Petroleum and Natural Gas Rights on the exercise of
     options granted herein.

2.02 Allocation of Purchase Price
     ----------------------------
     The Purchase Price payable by the Purchaser to the Vendor for the
     Assets is $8,000,000.00, as adjusted in clause 2.05, and shall be
     allocated among the Assets as follows:

     (a)  To Petroleum and Natural Gas Rights                 $7,604,259.00

     (b)  To Tangibles                                          $395,740.00

     (c)  To Miscellaneous Interests                                  $1.00

          TOTAL                                               $8,000,000.00

     In determining the Purchase Price, the Parties have taken into account
     the Purchaser's assumption of responsibility for the future
     abandonment and reclamation costs associated with the Assets, as set
     forth in this Agreement, and the Vendor's release of responsibility
     therefor.

     2.03 Calculation of the Initial Interest Purchase Price.
     ---------------------------------------------------
     The Purchase Price payable by the Purchaser to the Vendor for the
     Initial Interest will be $2,677,018.70, being all of the Purchase
     Price allocated to the Tangibles and Miscellaneous Interests and 30%
     of the Purchase Price allocable to the Petroleum and Natural Gas
     Rights.

     2.04 Payment of Initia1 Interest Purchase Price
     -------------------------------------------
     The amount of$1,858,767.79 shall be paid by the Purchaser to the
     Vendor at Closing toward the Initial Interest Purchase Price, which is
     the Initial Interest Purchase Price less the amount of$618,250.91
     already paid by the Purchaser to the Vendor as a deposit and the
     amount of $200,000.00 which amount shall be paid by the Purchaser to
     the Vendor on or before June 30,1999, subject to any reductions as may
     be made pursuant to Article 3.00 or as otherwise provided in this
     Agreement. The Purchaser shall also remit to the Vendor at Closing the

                                    146
</Page>
<PAGE>

     GST applicable to that portion of the Initial Purchase Price allocated
     to the Tangibles and on the amount attributable to any other Assets or
     expenses to which GST may apply. All amounts payable pursuant to this
     Clause and the following Clause 2.05 shall be paid by cheque payable
     in immediately avai1able funds to the Vendor.

2.05 Options
     -------

     The Vendor hereby grants to the Purchaser five (5) successive annual
     options to acquire the Option Interest, which options will be for
     undivided 14% interests under and exercisable by the Purchaser
     delivering to the Vendor, on or before the anniversary of the Closing
     Date, the Annual Option Interest Purchase Price of$1,064,596.26, plus
     interest thereon at the prime rate per annum of the Main Branch in
     Calgary of the Exercise Bonus Amount and the Purchaser agrees to
     exercise all of the options granted herein. Upon the occurrence of an
     Event of Default all options granted herein which are unexercised
     shall immediately terminate and be of no further force and effect.

2.06 Purchaser's Default In Exercising Options
     -----------------------------------------
     Upon the occurrence of an Event of default, in addition to the rights
     specified in Clause 2.07 hereof:

     A.   all unexercised options granted in Clause 2.05 shall immediately
          terminate and be of no further force and effect;

     B.   the Vendor will be entitled to a re-conveyance of the Secured
          Assets, and for this purpose the Purchaser hereby irrevocably
          appoints the Vendor as the Purchaser's lawful attorney with full
          power of substitution to endorse and transfer the Secured Assets
          from the Purchaser to the Vendor, with the power to make, execute
          and deliver all such documents, and perform all such acts, and do
          all matters or things, and with the right to use the name of the
          Purchaser whenever and wherever it may by deemed necessary or
          expedient, and which power and right shall include, but not be
          limited to, the following:

          (a)  the power to make, execute and deliver on behalf of the
               Purchaser a General Conveyance in the form attached as
               Schedule "B" re-conveying the Unexercised Option Interest
               from the Purchaser to the Vendor;

          (b)  the power to make, execute and deliver on behalf of the
               Purchaser all specific assignments, registrable transfers,
               novation agreements, trust agreements and other instruments
               required to convey the unexercised Option Interest to the
               Purchaser, provided that such documents shall not require
               the Vendor to assume or incur any obligation, or to provide
               any representation or warranty, beyond that contained in
               this Agreement; and

          (c)  correspond and deal with governmental agencies having
               jurisdiction over the Unexercised Option Interest and make,
               execute and deliver on behalf of the Purchaser any and all
               specific assignments. registerable transfers or applications
               required to vest in the vendor all rights conferred on the
               Purchaser by such governmental authorities in respect of the
               Unexercised Option Interest.

                                    147
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<PAGE>
2.07 Purchaser's Post-Closing Entitlements/Obligations:
     --------------------------------------------------

     A.   After Closing, while not in default of exercising an option
          granted pursuant to Clause 2.05, whether or not the Purchaser
          becomes the recognized holder in the place of the vendors of all
          or a portion of the Assets (including both the Initial Interest
          and the Option Interest):

          (a)  the Purchaser shall be entitled to receive and hold all
               proceeds, benefits and advantages accruing from the Assets
               for the benefit, use and ownership of the Purchaser, with
               entitlement to commingle any of them with its own or any
               other assets;

          (b)  the Vendor shall in a timely manner deliver to the Purchaser
               all revenues, proceeds and other benefits received by the
               vendor for the Assets after deduction of any amounts owing
               by the Purchaser to the vendor relating to the Assets;

          (c)  the vendor shall in a timely manner deliver to the Purchaser
               all third party notices and communications received by the
               vendor for the Assets;

          (d)  the vendor shall in a timely manner deliver to third parties
               all notices and communications as the Purchaser may
               reasonably request and all monies and other items the
               Purchaser reasonably provides for the Assets;

          (e)  the Vendor shall as agent of the Purchaser, do and perform
               all acts and things, and execute and deliver all agreements,
               notices and other documents and instruments, that the
               Purchaser reasonably requests for the purpose of
               facilitating the exercise of rights incidental to the
               ownership of the Assets; and

          (f)  the Purchaser shall be responsible for all obligations,
               expenses, costs, ingoings and outgoings of every kind and
               nature, accruing or payable with respect to the Assets,
               including, but not limited to, maintenance, development,
               capital and operating costs, advances, payments with respect
               to the Permitted Encumbrances, and authorizations for
               expenditures;

               Provided that, upon the occurrence of an Event of Default, the
               Vendor's obligations and the Purchaser's rights herein shall
               immediately terminate with respect to the Unexercised Option
               Interest and the Vendor will be entitled from that date for
               all intents and purposes to be recognized and hold itself out
               as holder of the Unexercised  Option Interest.

                                    148
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<PAGE>

B.   The Purchaser covenants and agrees that, while any of the options
     granted pursuant to Clause 2.05 remain unexercised, the Purchaser
     shall:

     (a)  not grant any security interest in or otherwise under the
          Assets or any pol1ion thereof;

     (b)  not transfer, convey, assign or grant participation or
          options rights in the Assets or any portion thereof to any
          third party;

     (c)  not permit or suffer any builder's lien to be registered or
          filed against the Assets or any portion thereof;

     (d)  from time to time when requested by the Vendor, grant to
          the Vendor such security interests in the Secured Assets or
          any portion thereof that the vendor requires as security for
          the Purchaser's performance of its obligations contained in
          Clause 2.05, and to immediately execute and deliver to the
          vendor such security evidencing the said security interests
          in the form or forms approved by the vendor;

C.   The Vendor shall not be liable to the Purchaser for any loss or
     damage suffered by the Purchaser in connection with the
     arrangements established by the Purchaser in connection with the
     arrangement established by Subclause 2.07 A, except to the extent
     that the loss or damage is caused by the Vendor' s gross
     negligence or its wilful misconduct. The Purchaser shall:

     (a)  be liable to the Vendor for all losses, costs, damages and
          expenses whatsoever which the vendor may suffer, sustain,
          pay or incur; and

     (b)  indemnify and save harmless the vendor and its directors,
          officers, servants, agents, consultants and employees from
          and against any claims, liabilities, actions, proceedings,
          demands, losses, costs, damages and expenses whatsoever
          which may be brought against or suffered by any of them or
          which they may sustain, pay or incur;

          arising out of the performance by the Vendor of its obligations under
          Subclause 2.07A. An action omission of the vendor or its directors,
          officers, servants, agents or employees shall not be regarded as gross
          negligence or wilful misconduct, however, to the extent it was done or
          omitted to be done in accordance with the instructions of or with the
          concurrence of the Purchaser. Nothing in this Clause 2.07 shall be
          construed as extending or restricting or limiting in any manner any of
          the other covenants, warranties, representations or other obligations
          of the Parties under this Agreement.



                                    149
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<PAGE>

D.   After Closing, where the Purchaser is assuming operatorship of
     any of the Assets, the Purchaser shall be responsible for
     submission of any reports required by the Regulations, including
     but not limited to monthly production reports pertaining to the
     Assets. If requested by the Purchaser, the Vendor shall assist
     the purchaser in compiling pre-Closing production data.

3.00        THIRD PARTY RIGHTS AND CONSENTS
            -------------------------------
3.01        Preferential Rights of Purchase and Consents
            --------------------------------------------

            A.   If any of the Assets are subject to a preferential right of
                 purchase or similar restriction, or if the disposition herein
                 requires the consent of any third party, the Vendor shall
                 promptly serve all notices as are required under such
                 preferential purchase or consent provision. Each such notice
                 shall include a request for a waiver of any preferential or
                 similar right to purchase any of the Assets and for the
                 granting of any consent that may be required. Notwithstanding
                 the foregoing, the Parties acknowledge that the consent of
                 buyers under production sale agreements may not be sought until
                 after Closing.

            B.   The Purchaser, acting reasonably and in good faith, shall
                 provide to the Vendor the value placed by the Purchaser on
                 any of the Assets with respect to which the Vendor is required
                 to specify a value in a notice served pursuant to this Clause.
                 The Vendor shall not be obligated to use such a value where, in
                 the Vendor's opinion, the value is unreasonable.


            C.   If the holder of any preferential right to purchase any of the
                 Assets exercises such right, or a third party required to give
                 a necessary consent refuses to give such consent, Closing shall
                 then proceed with respect to those of the Assets which are not
                 subject to such preferential right  to purchase or consent. In
                 such case, the Purchase Price shall be reduced by the portion
                 of the Purchase Price allocated pursuant to Subclause 3.01B to
                 the Assets directly affected by such preferential right to
                 purchase or consent, or falling such allocation, by agreement
                 of the Parties or by Article 12.00.

            D.   If the portion of the Purchase Price applicable to the Assets
                 directly affected by the preferential right to purchase or
                 consent provided for in Subclause 3.01C is to be determined
                 pursuant to Article 12.00:

                 (a)  then prior to Closing, the Purchaser shall deduct from the
                      Purchase Price an amount equal to the Purchaser's good
                      faith estimate of the portion of the Purchase Price
                      applicable to such directly affected Assets and deposit
                      such amount in trust with a Canadian chartered bank in
                      an interest bearing account; and

                 (b)  the funds retained in trust pursuant to Paragraph (a) of
                      this Subclause and the accrued interest thereon shall be
                      released from trust following determination pursuant to
                      Article 12.00. To the extent that the amount held in trust
                      varies from such determination, any excess or deficiency

                                    150
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<PAGE>

                      and the interest which accrued thereon shall either be
                      paid by the Purchaser to the Vendor within fifteen (15)
                      days of such determination or be retained by the
                      Purchaser, as applicable.

          E.   If a portion of the Assets is excluded from the Closing pursuant
               to this Clause:

               (a)  the terms ''Assets" , "Lands" , "Leases" , "Miscellaneous
                    Interests" , "Petroleum and Natural Gas Rights" and
                    "Tangibles" shall be construed as meaning only that portion
                    of the subject matter of those terms with respect to which
                    Closing occurs; and

               (b)  The term "Purchase Price" shall be construed to be the
                    amount of the Purchase Price remaining after the reduction
                    provided for in Subclause 3.01C, and the allocation of the
                    Purchase Price pursuant to Clause 2.02 shall be determined
                    by agreement of the Parties or by Article 12.00 and adjusted
                    accordingly.

3.02        Operatorship And Third Parties
            ------------------------------
            Nothing in this Agreement shall be interpreted as any assurance by
            the Vendor that the Purchaser will be able to serve as operator with
            respect to any of the Assets in which interests are held by third
            parties, whether or not such Assets are presently operated by the
            Vendor.

4.00        PURCHASER'S REVIEW
            ------------------

4.01        Vendor To Provide Access
            ------------------------

            The Vendor shall, subject to the Regulations and all contractual and
            fiduciary obligations and limits:

            (a)  at the Vendor's office during normal business hours, provide
                 the Purchaser and its nominees reasonable access to the
                 Vendor's records, files and documents directly relating to
                 the Assets, for the purpose of the Purchaser's review of the
                 Assets and the Vendor's title thereto, including, without
                 limitation, the Leases and applicable operating agreements,
                 unit agreements, overriding royalty agreements and production
                 sale contracts; and

            (b)  provide the Purchaser and its nominees with a reasonable
                 opportunity to inspect the Assets at the Purchaser's sole cost,
                 risk and expense, insofar as the Vendor can reasonably provide
                 access to the Assets.

4.02        Title Defects
            -------------
            A.   Any review of the Vendor's title to the Assets shall be
            undertaken by the Purchaser with reasonable diligence. Not later
            than ten (10) days prior to the Closing Date, the Purchaser shall
            give the Vendor written notice of the Title Defects which the
            Purchaser does not waive. Such notice shall specify such Title

                                    151
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<PAGE>
            Defects in reasonable detail, the Assets directly affected
            thereby (the II Affected Assets") and the Purchaser's
            requirements for the rectification or curing thereof. The
            Vendor shall there upon diligently make reasonable efforts to
            cure such Title Defects on or before the Closing Date.

            B.   Insofar as the Title Defects described in the Purchaser's
            notice have not been cured to the Purchaser's reasonable
            satisfaction, the Purchaser may elect, on or before the Closing
            Date by written notice to the vendor, to do one of the following:

           (a)  delay the Closing Date to such later date as is agreed by
                the Parties, so as to provide the Vendor with additional
                time to cure the remaining Title Defects;

           (b)  waive such uncured Title Defects and proceed with Closing;
                or

           (c)  terminate this Agreement, if the portion of the Purchase
                Price applicable to the Assets directly affected by such
                uncured Title Defects is twenty-five percent (25%) or more
                of the Purchase Price, as determined by agreement of the
                Parties or by Article 12.00, as the case may be.

            However, failure of the Purchaser to make such election at or before
            the Closing Date shall be  deemed to be an election pursuant to
            Paragraph (b) of this Subclause.

5.00        ADJUSTMENTS
            -----------

5.01        No Adjustment
            -------------
            The Parties acknowledge that, in agreeing to the amount of the
            Purchase Price, the Parties determined that there shall be no
            adjustments to the Purchase Price for the vendor' s prepaid expenses
            accruing after the Effective Date or for any other item ordinarily
            adjusted between a vendor and Purchaser on a sale of assets of a
            similar nature to the sale contemplated by this Agreement.

6.00        INTERIM PROVISIONS
            ------------------

6.01 Assets To Be Maintained In Proper Manner
            ----------------------------------------
            Possession of the Assets shall not pass to the Purchaser until after
            Closing on the Closing Date. The vendor shall continue to maintain
            the Assets on behalf of the Purchaser in a proper and prudent
            manner in accordance with good oil field practice and the
            Regulations until Closing. The Vendor shall maintain insurance
            respecting the Assets until the Closing Date.

6.02        Vendor as Agent
            ---------------
            A.   Insofar as the Vendor maintains the Assets and takes actions
                 with respect thereto on behalf of the Purchaser pursuant to
                 this Article, the Vendor shall be deemed to have been the agent
                 of the Purchaser hereunder. The Purchaser ratifies all actions
                 which the vendor takes or refrains from taking pursuant to the
                 terms of this Article, with the intention that all such actions
                 shall be deemed to be those of the Purchaser.

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<PAGE>
            B.   The Purchaser shall indemnify the vendor and its directors,
                 officers, servants, agents, consultants or employees against
                 all liabilities, losses, costs, claims or damages which the
                 vendor or its directors, officers, servants, agents,
                 consultants or employees may suffer or incur as a result of
                 maintaining the Assets as the agent of the Purchaser pursuant
                 to this Article, insofar as such liabilities, losses, costs,
                 claims or damages are not a direct result of the gross
                 negligence or wilful misconduct of the vendor or its directors,
                 officers, servants, agents, consultants or employees. An action
                 or omission of the vendor or its directors, officers, servants,
                 agents, consultants or employees shall not be regarded as gross
                 negligence or wilful misconduct, however, to the extent it was
                 done or omitted to be done in accordance with the instructions
                 of or with the concurrence of the Purchaser.

6.03        Restrictions on Conduct of Business
            -----------------------------------
            While acting as agent for the Purchaser pursuant to this Article,
            the vendor shall not, without the prior written consent of the
            Purchaser:

       (a)  voluntarily assume any obligation or commitment with respect to
            the Assets, where the Vendor's share of the expenditure
            associated with such obligation or commitment is estimated to
            exceed $25,000.00;

       (b)  surrender or abandon any of the Assets;

       (c)  mend any agreement or enter into any new agreement respecting
            the Assets;

       (d)  propose any operation with respect to the Assets or initiate
            the exercise of any right arising as a result of the ownership
            of the Assets;

       (e)  sell, transfer or otherwise dispose of the Assets, or any of
            them, except as may be required by the Vendor to comply with its
            obligations respecting any preferential rights, as provided in
            Article 3.00; or

       (f)  grant a security interest or any encumbrance with respect to any
            of the Assets.

          However, the Vendor may assume such obligations or commitments and
          propose or initiate such operations or exercise any such right or
          option without the prior consent of the Purchaser, if the Vendor
          reasonably determines that such expenditures or actions are necessary
          for the protection of life or property, in which case the Vendor shall
          promptly notify the Purchaser of such intention or actions and the
          Vendor's estimate of the costs and expenses associated therewith.


                                    153
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<PAGE>

7.00      REPRESENTATIONS AND WARRANTIES OF PARTIES
          -----------------------------------------
7.01      Vendor's Representations and Warranties
          ---------------------------------------

          The Vendor represents and warrants to the Purchaser that:

          (a)  Standing: The Vendor is a corporation, duly organized, valid and
               subsisting and registered under the laws of the Province of
               Alberta, and authorized to carry on business in the jurisdiction
               where the Lands are located;

          (b)  Requisite Authority The Vendor has the requisite capacity, power
               and authority to execute this Agreement and the Conveyance
               Documents and to perform the obligations to which it thereby
               becomes subject;

          (c)  No Conflict: The execution and delivery of this Agreement and the
               completion of the sale of the Assets in accordance with the terms
               of this Agreement are not and will not be in violation or breach
               of, or be in conflict with:

               (i)  any term or provision of the constating or other governing
                    documents of the Vendor;

               (ii) any agreement, instrument, permit or authority to which the
                    Vendor is a party or by which the Vendor is bound; or

               (iii)the Regulations or any judicial  order, award, judgement or
                    decree applicable to the Vendor or the Assets;

          (d)  Execution And Enforceability: The Vendor has taken all actions
               necessary to authorize the execution and delivery of this
               Agreement, and, as of the Closing Date, the Vendor shall have
               taken all actions necessary to authorize and complete the sale of
               the Assets in accordance with the provisions of this  Agreement.
               This Agreement has been validly executed and delivered by the
               Vendor, and this Agreement and all other documents executed and
               delivered on behalf of the Vendor hereunder shall constitute
               valid and binding obligations of the Vendor enforceable in
               accordance with their respective terms and conditions;

          (e)  Residency: Far Tax Purposes: The Vendor is not a non-resident of
               Canada within the meaning of the Income Tax Act (Canada);

          (f)  No Finders' Fees: The Purchaser shall not  have any
               responsibility for any obligation or liability, contingent or
               otherwise, for brokers' or finders' fees, if any, incurred by the
               Vendor with respect to the transactions herein;

          (g)  Lawsuits And claims: To the best of the knowledge of the Vendor,
               there are no unsatisfied judgements, claims, proceedings,
               actions, governmental investigations or lawsuits in existence,
               contemplated or threatened against or with respect to the Assets
               or the interest of the Vendor therein, and there exists no
               particular circumstance which the vendor reasonably believes will
               give rise to such a claim, proceeding, action, governmental
               investigation or lawsuit;

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<PAGE>
          (h)  Compliance With Leases and Agreements: To the best of the
               knowledge of the vendor , no act or omission has occurred whereby
               the vendor is, or would be, in default under the terms of the
               Regulations, any Lease or any agreement pertaining to the Assets,
               where such a default would impact materially and adversely upon
               the Assets, or any of them;

          (i)  No Default Notices: Except as has been specifically identified in
               Schedule '' A", the Vendor has not received any notice of default
               under the Leases or any notice alleging its default under any
               agreement pertaining to any of the Assets, which default has not
               been rectified as of the date of this Agreement;

          (j)  Payment of Royalties and Taxes: To the best of the knowledge of
               the Vendor, all royalties and all ad valorem,  property,
               production, severance and similar taxes and assessments based on,
               or measured by, the Vendor's ownership of the Assets, the
               production of Petroleum Substances from the Lands or the receipt
               of proceeds therefrom that are payable by the Vendor and which
               accrued prior to the Effective Date have been or will be properly
               and fully paid and discharged in the manner and at the time
               prescribed by the Leases and the Regulations;

          (k)  Encumbrances: The Vendor does not warrant its title to the
               Assets, but does warrant that the Vendor's Interest in the Assets
               is free and clear of any and all liens, mortgages, pledges,
               claims, options, encumbrances, overriding royalties, net profits
               interests or other burdens created by, through or under the
               Vendor, other than the Permitted Encumbrances;


          (l)  No Reduction: The vendor's Interest in the Assets is not subject
               to reduction by payout of a Well or otherwise, or subject to
               modification in size or nature by virtue of any right or interest
               granted by, through or under the Vendor except for the Permitted
               Encumbrances and any such rights and interests identified in
               Schedule " A " ;

          (m)  Sale Agreements: Except as identified in Schedule   "A", the
               Petroleum Substances are not subject to any gas balancing
               agreements nor any agreements for the sale of Petroleum
               Substances which are not terminable on thirty (30) days' notice
               or less (without an early termination penalty or other cost);

          (n)  Environmental Matters. The Vendor is not aware of and has not
               received:

               (i)  any orders or directives pursuant to the Regulations which
                    relate to environmental matters and which require any work,
                    repairs, construction or capital expenditures with respect
                    to the Assets, where such orders or directives have not been
                    complied with in all material respects; or


                                    155
</Page>
<PAGE>


               (ii) any demand or notice issued pursuant to the Regulations
                    with respect to the breach of any environmental, health or
                    safety law applicable to the Assets, including, without
                    limitation, any Regulations respecting the use, storage,
                    treatment, transportation or disposition o environmental
                    contaminants, which demand or notice remains outstanding as
                    of the date hereof;

               except as have been specifically disclosed by the Vendor. by
               notice to the Purchaser prior to the Vendor's submission of this
               Agreement to the Purchaser for the Purchaser's execution;

          (o)  Condition of Wells: To the best of the knowledge of the Vendor,
               each Well has been drilled and, if completed, completed and
               operated in accordance with good oil and gas field practices and
               the material requirements of the Regulations;

          (p)  Abandonment Of Wells:  To the best of the knowledge of the
               Vendor, each Well which has been abandoned has been plugged and
               abandoned, and the wellsite therefor properly restored, in
               accordance with good oil and gas field practices and the material
               requirements of the Regulations;

          (q)  Condition Of Tangibles: To the best of the knowledge of the
               Vendor, the Tangibles have been constructed, installed,
               maintained and operated in accordance with generally accepted
               engineering practices, good oil and gas field practices and the
               material requirements of the Regulations;

          (r)  Authorized Expenditures: There are no outstanding authorizations
               for expenditure or outstanding financial commitments respecting
               the Assets, pursuant to which expenditures are or may be required
               by the Purchaser or in respect of which any amount is
               outstanding, other than as set forth in Schedule "A" or as may be
               authorized on behalf of the Purchaser in accordance herewith;

          (s)  Area Of Mutual Interest: No agreement affecting the lands
               provides for an area of mutual interest, except as specifically
               identified in Schedule "A";

          (t)  Quiet Enjoyment: Subject at all times to the Vendor's other
               representations and warranties made pursuant to this Clause, the
               Permitted Encumbrances and the satisfaction of the obligations
               required to maintain the Leases in good standing by the
               applicable lessees, the Purchaser may, for the remainder of the
               term of the Leases, hold and utilize the Assets for the
               Purchaser's own use and benefit without any interruption by the
               Vendor or any other person claiming by through or under the
               Vendor.

7.02      Purchaser's Representations And Warranties
          ------------------------------------------

          The Purchaser represents and warrants to the Vendor that:

          (a)  Standing The Purchaser is a corporation, duly organized, valid
               and subsisting under the laws of its jurisdiction of
               incorporation, and duly registered and authorized to carry on
               business in the jurisdiction in which the Lands are located;

                                    156
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<PAGE>
          (b)  Requisite Authority: The Purchaser has the requisite capacity,
               power and authority to execute this Agreement and the Conveyance
               Documents and to perform the obligations to which it thereby
               becomes subject;

          (c)  G.S.T.: The Purchaser is registered for GST purposes and will
               provide the Vendor with its registration number on the Closing
               Date;

          (d)  No Conflict: The execution and delivery of this Agreement and the
               completion of the purchase of the Assets in accordance with the
               terms of this Agreement are not and will not be in violation or
               breach of, or be in conflict with:

               (i)  any term or provision of the constating or other governing
                    documents of the Purchaser; or

               (ii) the Regulations or any judicial order, award, judgement or
                    decree applicable to the Purchaser;

          (d)  Execution And Enforceability: The Purchaser has taken all actions
               necessary to authorize the execution and delivery of this
               Agreement and, as of the Closing Date, the Purchaser shall have
               taken all actions necessary to authorize and complete the
               purchase of the Assets in accordance with the provisions of this
               Agreement. This Agreement has been validly executed and delivered
               by the Purchaser, and this Agreement and all other documents
               executed and delivered on behalf of the Purchaser hereunder shall
               constitute valid and binding obligations of the Purchaser
               enforceable in accordance with their respective terms
               and conditions;

          (e)  Residence For Tax Purposes: The Purchaser is not a non-resident
               of Canada within the meaning of the Income Tax Act (Canada);

          (f)  No Sales Commission: The Purchaser has not incurred any
               obligation or liability, contingent or otherwise, for brokers' or
               finders' fees with respect to the transactions herein for which
               the vendor shall have any responsibility;

          (g)  Investment Canada Act The Purchaser shall comply with the
               Investment Canada Act to the extent, if any, that it is
               applicable to the transactions herein;

          (h)  Purchaser As Principal: The Purchaser is acquiring the Assets in
               its capacity as a principal, and is not purchasing the Assets for
               the purpose of resale or distribution to a third party; and

          (i)  Transfers of  Licences, Permits and Authorizations: The Purchaser
               is not aware of anything that would prohibit the Purchaser from
               obtaining or holding any well licences, authorizations or other
               permits or licenses related to the Assets with the relevant
               governmental authorities.


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<PAGE>
7.03      Survival of Representations and Warranties
          ------------------------------------------
          Each Party acknowledges that the other may rely on the representations
          and warranties made by such Party pursuant to Clause 7.01 or7.02, as
          the case may be. The representations and warranties in Clauses 7.01
          and 7.02 shall be true on the Closing Date, and such representations
          and warranties shall continue in full force and effect and shall
          survive the Closing Date for a period of one (1) year, for the benefit
          of the Party for which such representations and warranties were made.
          In the absence of fraud, however, no claim or action shall be
          commenced with respect to a breach of any such representation or
          warranty, unless, within such period, written notice specifying such
          breach in reasonable detail has been provided to the Party which made
          such representation or warranty.

7.04      Limit on Vendor's Responsibility
          --------------------------------
          In no event, except in the event of fraud, shall the total of the
          liabilities of the vendor under this Agreement exceed the Purchase
          Price.

7.05      No Additional Representations Or Warranties By Vendor
          -----------------------------------------------------
          A.   The Vendor makes no representations or warranties to the
               Purchaser in addition to those expressly enumerated in Clause
               7.01. Except and to the extent provided in Clause 7.01, the
               Vendor does not warrant title to the Assets or make
               representations or warranties with respect to:

               (i)  the quantity , quality or recoverability of Petroleum
                    Substances respecting the Lands;
               (ii) any estimates of the value of the Assets or the revenues
                    applicable to future production from the Lands;
               (iii)any engineering, geological or other interpretations or
                    economic evaluations respecting the Assets;
               (iv) the rates of production of Petroleum Substances from the
                    Lands;
               (v)  the quality, condition or serviceability of the Assets; or
               (vi) the suitability of the use of the Assets for any purpose.

           The Purchaser acknowledges that it has made its own independent
           investigation, analysis, evaluation, verification and inspection
           of the Vendor's interests in the Assets and the state and
           condition thereof and that it has relied solely on such
           investigation, analysis, evaluation, verification and inspection
           as to its assessment of the condition (environmental or
           otherwise), quantum and value of the Assets.

      B.   Except with respect to the representations and warranties in
           Clause 7 01 or in the event of fraud, the Purchaser forever
           releases and discharges the Vendor and its directors, officers,
           servants, agents and employees from any claims and all liability
           to the Purchaser or the Purchaser's assigns and successors, as a
           result of the use or reliance upon advice, information or
           materials pertaining to the Assets which was delivered or made
           available to the Purchaser by the Vendor or its directors,
           officers, servants, agents or employees prior to or pursuant to
           this Agreement, including, without limitation, any evaluations,
           projections, reports and interpretive or non- factual materials
           prepared by or for the vendor , or otherwise in the vendor's
           possession.
                                    158
</Page>
<PAGE>

8.00        LIABILITY AND INDEMNIFICATION
            -----------------------------

8.01        Responsibility of Purchaser
            ---------------------------

            Provided that Closing has occurred, the Purchaser shall:

       (a)  be liable to the vendor for all losses, costs, damages and
            expenses whatsoever which the vendor may suffer, sustain, pay or
            incur; and
       (b)  indemnify and save the Vendor  and its directors, officers,
            servants, agents, consultants and employees harmless from and
            against all claims, liabilities, actions, proceedings, demands,
            losses, costs, damages and expenses whatsoever which maybe
            brought against or suffered by the Vendor , its directors,
            officers, servants, agents, consultants or employees or which
            they may sustain, pay or incur;

            as a direct result of any matter or thing arising out of, resulting
            from, attributable to or connected with the Assets and occurring or
            accruing subsequent to the Effective Date, except any losses, costs,
            damages, expense, claims, liabilities, actions, proceedings and
            demands to the extent that the same either are reimbursed (or
            reimbursable) by insurance maintained by the Vendor or are caused by
            the gross negligence or wilful misconduct of the Vendor, its
            directors, officers, servants, agents, consultants, employees or
            assigns. The responsibility prescribed by this Clause, however, does
            not provide either an extension of any representation or warranty
            contained in Clause 7.02 or an additional remedy for the Purchaser's
            breach of such a representation or warranty.

8.02      Environmental Indemnity
          -----------------------
          The Purchaser acknowledges that with respect to the environmental
          condition of the Assets, it is acquiring the Assets on an ''as is"
          basis. The Purchaser acknowledges that it is familiar with the
          condition of the Assets, including the past and present use of the
          Lands and the Tangibles, that the Vendor has provided the Purchaser
          with a reasonable opportunity to inspect the Assets at the sole cost,
          risk and expense of the Purchaser (insofar as the Vendor could
          reasonably provide access) and that the Purchaser is not relying upon
          any representation or warranty of the Vendor as to the condition,
          environmental or otherwise, of the Assets, except as is specifically
          made pursuant to Clause 7.01. Provided that Closing has occurred, the
          Purchaser further agrees that it shall:

          (a)  be solely liable and responsible for any and all losses, costs,
               damages and expenses which the Vendor may suffer, sustain, pay or
               incur; and

          (b)  indemnify and save the Vendor and its directors, officers,
               servants, agents, consultants and employees harmless from any and
               all claims, liabilities, actions, proceedings, demands, losses,
               costs, damages and expenses whatsoever which may  be brought
               against or suffered by the vendor, its directors, officers,
               servants, agents, consultants or employees or which they may
               sustain, pay or incur;


                                    159
</Page>
<PAGE>

       as a direct result of any Environmental Liabilities, regardless of the
       date from which they may have accrued. This liability and indemnity
       shall apply without limit and without regard to cause or causes,
       including without limitation, the negligence or wilful misconduct of
       the parties or any other person. Once Closing has occurred, the
       Purchaser shall be solely responsible for all Environmental
       Liabilities, including, without limitation, the abandol1n1ent of all
       wells and the reclamation of the surface lands pertaining to the
       Lands, and the Purchaser hereby releases the vendor from any claims
       the Purchaser may have against the vendor with respect to all such
       liabilities and responsibilities. Nothing in this Clause, however,
       shall operate either to limit any representation or warranty made by
       the Vendor pursuant to Clause 7.01 or to affect the Purchaser's right
       to make a claim against the Vendor for the breach of such a
       representation or warranty.

9.00   CLOSING
       -------

9.01   Place Of Closing
       ----------------
       Unless otherwise agreed in writing by the Parties, Closing shall take
       place at the offices of the Vendor's solicitor at #900, 521 3rd Avenue
       S.W., Calgary , Alberta on the Closing Date.

9.02   Required  Approvals
       -------------------
       It is a condition precedent to Closing that any and all approvals
       required under the Regulations shall have been obtained or that such
       approval shall have been waived, otherwise lapsed or is a foffi1 of
       approval which is customarily obtained subsequent to Closing.

9.03   Conditions For Benefit Of Purchaser
       -----------------------------------
       The obligation of the Purchaser to complete the purchase hereunder is
       subject to the following conditions precedent:

       (a)  No Substantial Damage: There shall have been no damage to or
            alteration of any of the Assets between the Effective Date and
            the Closing Date which, in the Purchaser's reasonable opinion,
            would materially and adversely affect the value of the Assets,
            except and to the extent approved in writing by the Purchaser,
            provided that a change in the prices at which Petroleum
            Substances may be sold in no event shall be regarded as material
            damage to or an alteration of the Assets. In addition, the Vendor
            shall have  delivered to the Purchaser a certificate of a senior
            officer of the Vendor in the form of Schedule "D";

       (b)  Availability of Documents: The Vendor shall have provided the
            nominees of the Purchaser with reasonable access to the Vendor's
            records and documents pertaining to the Assets pursuant to
            Article 4.00, in order to confirm the Vendor's title to the
            Assets;



                                    160
</Page>
<PAGE>

       (c)  Material Compliance By Vendor: The Vendor shall have performed or
            complied in all material respects with each of the terms,
            covenants and conditions of this Agreement to be performed or
            complied with by the Vendor at or prior to the Closing Date;

       (d)  Certificate That Representation Are Correct: The vendor shall
            have delivered to the Purchaser a certificate of a senior officer
            of the Vendor, in the form of Schedule "C"; and

       (e)  Delivery of Conveyance Documents: The Vendor shall have
            delivered the following to the Purchaser.

            (i)  a General Conveyance for the Assets, in the form attached as
                 Schedule "B", which has been executed by the Vendor;

            (ii) all specific assignments, registerable transfers, novation
                 agreements, trust agreements and other instruments required
                 to convey the Assets to the Purchaser, unless and to the
                 extent that the Purchaser allows the Vendor to
                 deliver such documents to the Purchaser at a later date,
                 provided that such documents shall not require the Vendor to
                 assume or incur any obligation, or to provide any
                 representation or warranty, beyond that contained in this
                 Agreement;

            (iv) copies of all consents to disposition and waivers of
                 preferential rights of purchase or any similar restriction
                 obtained by the Vendor with respect to the sale of the
                 Assets to the Purchaser;

            (v)  originals of the Vendor's records, files, reports and data
                 pertaining to the Assets, insofar as such delivery is
                 permitted and required hereunder, unless and to the extent
                 that the Purchaser agrees to allow the Vendor to deliver
                 such records, files, reports and data at a later date;

            (vi) such other documents as may be specifically required
                 hereunder or as may be reasonably requested by the Purchaser
                 upon reasonable notice to the vendor;

            (vii)a written notice of the Vendor's intention to sell the
                 Assets to the Purchaser, resign as Operator of the Lands and
                 appoint the Purchaser as Operator in the Vendor's place,
                 served on all working interest owners of the Lands; and

            (v)  a copy of the corporate proceedings of the Vendor
                 authorizing the Vendor to enter into this Agreement and
                 consummate the transactions contemplated herein.


                                    161
</Page>
<PAGE>

9.04   Conditional for Benefit Of Vendor
       ---------------------------------

       The obligation of the vendor to complete the sale hereunder is subject
       to the following conditions precedent:


       (a)  Material Compliance by Purchaser: The Purchaser shall have
            performed or complied in all material respects with each of the
            terms, covenants and conditions of this Agreement to be performed
            or complied with by the Purchaser at or prior to the Closing
            Date;

       (b)  Payment of Purchase Price: The Purchaser shall have tendered to
            the vendor the Purchase Price and the applicable goods and
            services tax in the manner provided for in Clause 2.03, subject
            to any adjustments provided for in Article 5.00 and any
            alteration expressly provided for herein;

       (c)  Certification That Representations Are Correct: The Purchaser
            shall have delivered to the Vendor a certificate of a senior
            officer of the Purchaser, in the form of Schedule "C";

       (d)  Delivery Of Documents: The Purchaser shall have executed and
            delivered to the Vendor one copy of the General Conveyance in the
            form attached as Schedule "B" and such other documents as may be
            specifically required hereunder; and

       (e)  Transfer of Wel1 Licenses: The Vendor shall have received
            evidence satisfactory to the Vendor, acting reasonably, that the
            relevant regulatory board or agency will approve the transfer to
            the Purchaser of well licenses and other licenses and permits
            pertaining to the Assets that are currently registered in the
            name of the Vendor.

9.05 Waiver Of Conditions
     --------------------
     The conditions in Clauses 9.03 and 9.04 are for the sole benefit of
     the Purchaser and the Vendor respectively. The Party for the benefit
     of which such conditions have been included may waive any of them, in
     whole or in part, by written notice to the other Party, without
     prejudice to any of the rights of the Party waiving such condition,
     including, without limitation, reliance on or enforcement of the
     representations, warranties or covenants which are preserved and
     pertain to conditions-similar to the condition so waived. However, the
     Purchaser may not waive the existence and operation of any
     preferential right of a third party to purchase any of the Assets or,
     without the concurrence of the Vendor, any required consent of a third
     party to the Vendor's disposition of any of the Assets.

9.06 Failure To Satisfy Conditions
     -----------------------------
     In the event any of the conditions in Clauses 9.03 or 9.04 has not
     been satisfied at or before the Closing Date and such condition has
     not been waived by the Party for the benefit of which such condition
     has been included, such Party may terminate this Agreement by written
     notice to the other Party. However, a Party may not terminate this
     Agreement in such manner after Closing, and its remedies thereafter,
     if any, with respect to the failure to satisfy such condition shall be
     limited to damages.

                                    162
</Page>
<PAGE>
10.00 POST CLOSING ADMINISTRATION
      ---------------------------
10.01 Registration of Documents
      -------------------------
      The vendor shall register promptly after Closing all documents
      described in Paragraph 9.03 (e) which require registration. The
      Purchaser shall reimburse the vendor for all costs  incurred in
      registering such documents and shall bear all costs of preparing and
      registering any further assurances required to convey the Initial
      Interest to the Purchaser.

      10.02 Vendor's Access to Documents
      ----------------------------

      The Vendor may retain or subsequently obtain from the Purchaser
      copies or photocopies of any of the documents comprised in
      Miscellaneous Interests that it considers necessary to enable it to
      comply with any Regulations or the requirements of any authority or
      to conduct audits relating to the period prior to the Effective
      Date.

11.00 CONFIDENTIALITY
      ---------------

11.01 Purchaser's Obligation To Maintain Information Confidential
      -----------------------------------------------------------
      Information respecting the Assets shall be retained in confidence
      and used only for the purposes of this acquisition, provided that
      upon Closing, the Purchaser's rights to use or disclose such
      information shall be subject only to any operating, unit or other
      agreements that may apply thereto. Any additional information
      obtained as a result of such access which does not relate to the
      Assets shall continue to be treated as confidential and shall not be
      used by the Purchaser without the prior written consent of the
      vendor. However, the restrictions on disclosure and use of
      information in this Agreement shall not apply to information to the
      extent it:

      (a) is or becomes publicly available through no act or omission of
          the Purchaser or its consultants or advisors;

      (b) is subsequently obtained lawfully from a third party, where the
          Purchaser has made reasonable efforts to ensure that such third
          party is not a party to or bound by any confidentiality agreement
          with the Vendor; or

      (c) is already in the Purchaser's possession at the time of
          disclosure, without restriction on disclosure.

      However, specific items of information shall not be considered to be
      in the public domain merely because more general information
      respecting the Assets is in the public domain.

11.02 Consultants And Advisors Bound
      ------------------------------

      If the Purchaser employs consultants, advisors or agents to assist
      in its review of the Assets pursuant to Article 4.00, the Purchaser
      shall be responsible to the vendor for ensuring that such
      consultants, advisors and agents comply with the restrictions on the
      use and disclosure of information set forth in Clause 11.01 .

                                    163
</Page>
<PAGE>

      12.00 ARBITRATION
      -----------

12.01 Reference To Arbitration
      ------------------------
      Insofar as the Parties are unable to agree on any matter which
      expressly may be referred to arbitration hereunder, either Party may
      serve the other Party written notice that it wishes such matter
      referred to arbitration.

      The Parties shall meet within seven (7) days of the receipt of a
      notice issued pursuant to Subclause 12.01A, to attempt to agree on a
      single arbitrator qualified by experience, education and training,
      to determine such matter. If the Parties are unable to agree on the
      selection of the arbitrator, the Party which issued such notice
      shall forthwith make application to a judge of the Court of Queen's
      Bench of the Province of Alberta pursuant to the Arbitration Act of
      the Province of Alberta (S.A. 1991, c. A-43.1, as amended from time
      to time, hereinafter referred to as the "Arbitration Act") for the
      appointment of a single arbitrator, and failing such action on the
      part of the Party which issued such notice, the other Party may make
      such application.

12.02 Proceedings
      -----------
      A.  The arbitrator selected pursuant to Clause 12.01 shall proceed as
          soon as is practicable to hear and deteI1l1ine the matter in
          dispute, and shall be directed to provide a written decision
          respecting such matter within forty-five (45) days of
          appointment.  The Parties shall provide such assistance and
          information as may be reasonably necessary to enable the
          arbitrator to determine such matter.

      B.  Except to the extent modified in this Article, the arbitrator
          shall conduct any arbitration hereunder pursuant to the
          provisions of the Arbitration Act.

13.00 ASSIGNMENT
      ----------

13.01 Assignment Before Closing
      -------------------------
      Prior to Closing, neither Party may assign its interest in or under
      this Agreement or to the Assets without the prior written consent of
      the other Party, except as may be required by the vendor to comply
      with its obligations respecting any preferential rights, as provided
      in Article 3.00.




                                    164
</Page>
<PAGE>

13.02 Assignments By Purchase After Closing
      -------------------------------------
      No assignment, transfer or other disposition of this Agreement or
      all or any portion of the assets by the Purchaser after Closing
      shall relieve the Purchaser from its obligations to the Vendor
      herein. The Vendor shall have the option to claim payment or
      performance of such obligations from the Purchaser or the assignee
      or transferee, and to bring proceedings in the event of default
      against either or all of them, provided that nothing herein shall
      entitle the vendor to receive duplicate payment or performance of
      the same obligation.

14.00 NOTICE
      ------

14.01 Service Of Notice
      -----------------
      Notwithstanding anything to the contrary contained herein, all
      notices required or permitted hereunder shall be in writing. Any
      notice to be given hereunder shall be deemed to be served properly
      if served in any of the following modes:


      (a) personally, by delivering the notice to the Party on which it is
          to be served at that Party's address for service. Personally
          served notices shall be deemed to be received by the addressee
          when actually delivered as aforesaid, provided that such delivery
          shall be during normal business hours on any day other than a
          Saturday, Sunday or statutory holiday in Alberta. If a notice is
          not delivered on such a day or is delivered after the addressee's
          normal business hours, such notice shall be deemed to have been
          received by such party at the commencement of the addressee's
          first business day next following the time of the delivery;

      (b) by telecopier or telex ( or by any other like method by which a
          written message may be sent) directed to the party on which it is
          to be served at that Party's address for service. A notice so
          served shall be deemed to be received by the addressee when
          actually received by it, if received within normal business hours
          on any day other than a Saturday, Sunday or statutory holiday in
          Alberta or at the commencement of the next ensuing business day
          following transmission if such notice is not received during such
          normal business hours; or

      (c) bv" mailing it first class ( air mail if to or from a location
          outside of Canada) registered post, postage prepaid, directed to
          the party on which it is to be served at that Party's address for
          service. Notices so served shall be deemed to be received by the
          addressee at noon, local time, on the earlier of the actual date
          of receipt or the fourth (4th) day ( excluding Saturdays, Sundays
          and statutory holidays in Alberta) following the mailing thereof.
          However, if postal  service is (or is reasonably anticipated to
          be) interrupted or operating with unusual delay, notice shall not
          be served by such means during such interruption or period of
          delay.


                                    165
</Page>

<PAGE>

      14.02 Addresses For Notices
      ---------------------
      The address for service of notices hereunder of each of the
      Parties shall be as follows:

      VENDOR:   STARROCK RESOURCES LTD.
                #900,  521- 3rd Avenue S.W.
                Calgarv Alberta T2P 3T3
                Telecopier: (403) 264-6654

      PURCHASER: PROMAX ENERGY INC.
                 #810, 1122 - 4th Street S.W
                 Calgary, Alberta T2M lMl

      14.03 Right To Change Address
      -----------------------
      A Party may change its address for service by notice to the other
      Party, and such changed address for service thereafter shall be
      effective for all purposes of this Agreement.

      15.00 PUBLIC ANNOUNCEMENTS
      --------------------

15.01 Approval Required For Press Release
      -----------------------------------
      A.  Subject to Clause 11.01, the Parties shall cooperate with each
          other in relaying to third parties information concerning this
          Agreement and shall receive written approval from the other Party
          of all press releases and other releases of information prior to
          publication which approval may not be unreasonably withheld.
          However, nothing in this Clause shall prevent a Party from
          furnishing any information to any governmental agency or
          regulatory authority or to the public, insofar only as is
          required by the Regulations or securities laws applicable to such
          Party, provided that a Party which proposes to make such a public
          disclosure shall, to the extent reasonably possible, provide the
          other Party with a draft of such statement a sufficient time
          prior to its release to enable such other party to review such
          draft and advise that Party of any comments it may have with
          respect thereto.

      B.  Notwithstanding Subclause 15.01A, the Vendor shall be permitted
          to disclose information pertaining to this Agreement and the
          identity of the Purchaser, to the extent required to enable the
          Vendor to fulfil its obligations pertaining to preferential
          rights of purchase and other third party rights, in accordance
          with Article 3.00.

15.02 Signs And Notification To Governmental Agencies
      -----------------------------------------------
      Following Closing, the Vendor may remove any signs which indicate
      the Vendor's ownership or operation of the Assets. If the Purchaser
      will be the operator of the Assets, it shall be the responsibility
      of the Purchaser to erect or install any signs required by
      governmental agencies which pertain to the Assets. In addition, the
      Purchaser shall be responsible for advising governmental agencies,
      contractors, suppliers and other affected third parties of the
      Purchaser's interest in the Assets, subject to Article 3.00.

                                    166
</Page>
<PAGE>

16.00 MISCELLANEOUS PROVISIONS
      ------------------------
16.01 Further Assurance
      -----------------
      At the Closing Date and thereafter as may be necessary , the Parties
      shall execute, acknowledge and deliver such instruments and take
      such other actions as may be reasonably necessary to fulfil their
      respective obligations under this Agreement. The Vendor shall
      cooperate with the Purchaser as reasonably required to secure
      execution by third parties of the documents referred to in
      Subparagraph 9.03 (e) (ii).

16.02 Governing Law
      -------------

      This Agreement shall be subject to and be interpreted, construed and
      enforced in accordance with the laws in effect in the Province of
      Alberta. Each Party accepts the jurisdiction of the courts of the
      Province of Alberta and all courts of appeal therefrom.

16.03 Time
      ----
      Time shall be of the essence in this Agreement.

16.04 No Amendment Except In Writing
      ------------------------------

      Subject to Clause 14.03, this Agreement may be amended only by
      written instrument executed by the Vendor and the Purchaser.

16.05 Waiver Must Be In Writing
      -------------------------

      No waiver by any Party of any breach (whether actual or anticipated)
      of any of the terms, conditions, representations or warranties
      contained herein shall take effect or be binding upon that Party
      unless the waiver is expressed in writing under the authority of
      that  party. Any waiver so given shall extend only to the particular
      breach so waived and shall not limit or affect any rights with
      respect to any other or future breach.

16.06 Consequence Of Termination
      --------------------------

      If this Agreement is terminated in accordance with its terms prior
      to Closing, then except for the provisions of Article 11.00 and the
      covenants, warranties, representations or other obligations breached
      prior to the time at which such termination occurs, the Parties
      shall be released from all of their obligations under this
      Agreement. If this Agreement is so terminated, the Purchaser shall
      promptly return to the Vendor all materials delivered to the
      Purchaser by the Vendor hereunder, together with all copies of them
      that may have been made by or for the Purchaser.



                                    167
</Page>
<PAGE>

16.07 Supersedes Earlier Agreements
      -----------------------------
      This Agreement supersedes all other agreements between the Parties
      with respect to the Assets and expresses the entire agreement of the
      Parties with respect to the transactions contained herein.

16.08 No Merger
      ---------
      The representations, warranties, liabilities and indemnities created
      in this Agreement shall be deemed to apply to, and shall not merge
      in, all assignments, transfers, conveyances, novations, trust
      agreements and other documents conveying any of the Assets from the
      vendor to the Purchaser, notwithstanding the terms of such
      assignments, transfers, conveyances, novations and other documents,
      the Regulations or any rule of law or equity to the contrary , and
      all such rules are hereby waived.

16.09 Substitution and Subrogation
      ----------------------------
      Insofar as is possible, each party shall have full rights  of
      substitution and subrogation in and to all covenants,
      representations and warranties by others previously given or made in
      respect of the Assets or any of them.

16.10 Enurement
      ---------
      Subject to the provisions of Article 13.00, this Agreement shall be
      binding upon and enure to the benefit of the Parties and their
      respective successors and permitted assigns.


      IN WITNESS WHEREOF the Parties have duly executed this Agreement.


STARROCK RESOURCES LTD.                 PROMAX ENERGY INC.

Per: /S/ Al Langard                     Per: /S/ Robert Card

                                        Per: /S/ J.R. MacMillan


                                    168
</Page>
<PAGE>
This is SCHEDULE "A" to an Agreement of Purchase and Sale dated March
19, 1999 between STARROCK RESOURCES LTD. as Vendor and PROMAX
ENERGY INC. as Purchaser.

<TABLE>
<CAPTION>
                       Part I   Lands, Leases and Encumbrances
                      -----------------------------------------
                                     Lease       Vendor's
Legal         P&NG        Zones      Expiry      Working   Operator
Description   Lease       Included   Date        Interest  of
(W4M)         Number      in Lease   M/D/Y       (%)       Lease     Encumbrances
------------- ----------- ---------- ----------  --------- --------- -------------
<S>           <C>         <C>        <C>         <C>       <C>       <C>
6-6-25-7      0492020031  Base MH    Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
19-24-8       0497100596  All        10-30-02    74.56     Vendor    Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
6-24-9        0495010052  All        1-5-00      37.28     Calahoo   Crown Lessor
                                                                      Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
17-24-9**     0490040297  Base       Indefinite  74.56     Vendor    Crown Lessor
                          Viking                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
18-24-9       0494110451  All        11-24-99    37.28     Calahoo   Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
23-24-9       0497100597  All        10-30-02    74.56     Vendor    Crown Lessor
                                                                      Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
24-24-9       049700598   All        10-30-02    74.56     Vendor    Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
30-24-9       12286       Base MH    Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
              12286       Viking     4-24-99     74.56     Vendor    Crown Lessor
                                                                     Royalty
              0495010054  Below      1-5-00      37.28     Calahoo   Crown Lessor
                          Viking                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
32-24-9       37514       Base Mann  Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
34-24-9       0495090051  All        9-14-00     29.82     Seaton    Crown Lessor
                                                           Jordon    Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
35-24-9       0497100600  All        10-30-02    74.56     Vendor    Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
36-24-9       0497100601  All        10-30-02    74.56     Vendor    Crown Lessor
                                                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
2-24-10       0493040043  Base       Indefinite  74.56     Vendor    Crown Lessor
                          Mann                                       Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
11-24-10      39535       Base       Indefinite  74.56     Vendor    Crown Lessor
                          Viking                                     Royalty
              0498040317  Below      4-30-03     74.56     Vendor    Crown Lessor
                          Viking                                     Royalty
------------- ----------- ---------- ----------  --------- --------- -------------
</TABLE>                            169
</Page>
<PAGE>
<TABLE>
<CAPTION>
This is Schedule "A" to an Agreement of Purchase and Sale dated March 19, 1999
between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as purchaser

Page 2
                                     Lease       Vendor's
              P&NG        Zones      Expiry      Working   Operator
Location      Lease       Included   Date        Interest  of
(W4M)         Number      in Lease   M/D/Y       (%)       Lease     Encumbrances
---------------------------------------------------------------------------------
<S>           <C>         <C>        <C>         <C>       <C>       <C>
13-24-10      0493040044  Base Mann  4-1-99      74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
14-24-10      12286       Base Mann  10-30-02    74.56     Vendor    Crown Lessor
                                                                     Royalty
              12286       Viking     4-29-99     74.56     Vendor    Crown Lessor
                                                                     Royalty
              0495010055  Below      1-5-00      37.28     Calahoo   Crown Lessor
                          Viking                                     Royalty
---------------------------------------------------------------------------------
25-24-10      0496070046  All        7-11-00     74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
7-25-8        0499020043  All        2-3-04      74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
9-25-8        0498040318  All        4-30-03     74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
15-25-8       0492010234  Base Mann  Indefinite  45.31     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
16-25-8       0498040322  All        4-30-03     45.31     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
17-25-8       0498040323  All        4-30-03     74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
18-25-8       0499020044  All        2-3-04      74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
20-25-8       0492010235  Base Mann  Indefinite  50.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
21-25-8       0492010236  Base Mann  Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
28-25-8       0492010237  Base Mann  Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
1-25-9        0497100603  All        10-30-02    74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
4-25-9        8435        Base Mann  Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
5-25-9        12276       Base Mann  Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------

                                        170
</Page>
<PAGE>
---------------------------------------------------------------------------------
9-25-9        38435       Base Mann  Indefinite  74.56     Vendor    Crown Lessor
                                                                     Royalty
---------------------------------------------------------------------------------
11-25-9**     0491070294  Base       Indefinite  74.56     Vendor    Crown Lessor
                          Viking                                     Royalty
              0498040324  Below      4-30-03     74056     Vendor    Crown Lessor
                          Viking                                     Royalty
---------------------------------------------------------------------------------
12-25-9       0491030315  Base       Indefinite  74.56     Vendor    Crown Lessor
                          Viking                                     Royalty
              0498040325  Below      4-30-03     74.56     Vendor    Crown Lessor
                          Viking                                     Royalty
---------------------------------------------------------------------------------


</TABLE>


                                    171
</Page>
<PAGE>
This is SCHEDULE "A" to an Agreement of Purchase and Sale dated March 19,
1999 between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser

Page 3

All the above leases are subject to a 5% GORR.
The leases marked with an ** are subject to an additional 6% GORR.


                    Part II - Production Sales Contracts
                   -------------------------------------
                                   [None]


                         Part III - Unit Agreements
                        ---------------------------
                                   [None]


                       Part IV - Facility Agreements
                      -------------------------------
                                   [None]


                                    172
</Page>
<PAGE>
This is SCHEDULE "A" to an Agreement of Purchase and Sale dated March 19,
1999 between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser

Page 4

                    Part V- Wells and Gathering Systems
                   --------------------------------------

                             Cessford Equipment
                            --------------------


<TABLE>
<CAPTION>
Location (W4M)           License Number        Vendor Interest %
------------------------ --------------------- --------------------
<S>                      <C>                   <C>
------------------------ --------------------- --------------------
15-27-24-8               0205307               74.56
------------------------ --------------------- --------------------
10-17-24-9               0146609               74.56
------------------------ --------------------- --------------------
10-17-24-9               0176525               74.56
------------------------ --------------------- --------------------
7-30-24-9                163072                74.56
------------------------ --------------------- --------------------
7-30-24-9                0090208               74.56
------------------------ --------------------- --------------------
9-32-24-9                0096821               74.56
------------------------ --------------------- --------------------
12-2-24-10               161668                74.56
------------------------ --------------------- --------------------
12a-2-24-10              163073                74.56
------------------------ --------------------- --------------------
13-2-24-10               0076860               74.56
------------------------ --------------------- --------------------
12-11-24-10              0075362               74.56
------------------------ --------------------- --------------------
14-11-24-10              0145307               74.56
------------------------ --------------------- --------------------
6-14-24-10*              0051035               74.56
------------------------ --------------------- --------------------
6-6-25-7                 0204986               74.56
------------------------ --------------------- --------------------
6-15-25-8                0217157               45.31
------------------------ --------------------- --------------------
8-16-25-8                0217156               45.31
------------------------ --------------------- --------------------
6-20-25-8                0217843               74.56
------------------------ --------------------- --------------------
6-21-25-8                0206367               74.56
------------------------ --------------------- --------------------
10-28-25-8               0209012               74.56
------------------------ --------------------- --------------------
6-4-25-9                 0050887               74.56
------------------------ --------------------- --------------------

</TABLE>
                                    173
</Page>
<PAGE>

This is SCHEDULE "A" to an Agreement of Purchase and Sale dated March 19,
1999 between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser

Page 5
<TABLE>
<CAPTION>
------------------------ --------------------- --------------------
Location (W4M)           License Number        Vendor Interest
                                               (%)
<S>                      <C>                   <C>
------------------------ --------------------- --------------------
7-5-25-9                 0051972               74.56
------------------------ --------------------- --------------------
6-9-25-9                 0052198               74.56
------------------------ --------------------- --------------------
7-9-25-9                 0412019               74.56
------------------------ --------------------- --------------------
9-11-25-9                0189572               74.56
------------------------ --------------------- --------------------
15-12-25-9               0151802               74.56
------------------------ --------------------- --------------------

------------------------ --------------------- --------------------
     TOTALS
------------------------ --------------------- --------------------

*Dehydrator Located at 6-14-24-10

</TABLE>
                                    174
</Page>

<PAGE>
This is SCHEDULE "A" to an Agreement of Purchase and Sale dated March 19,
1999 between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser

Page 6

<TABLE>
<CAPTION>
                                  Cessford Pipeline
                                  ------------------
            From         To          Outside      Wall
Line        Location     Location    Diameter     Thickness   Length
Number      (W4M)        (W4M)       (inches)     (inches)    (Miles)
----------- -----------  ----------- -----------  ----------- -----------
<S>         <C>          <C>         <C>          <C>         <C>
----------- -----------  ----------- -----------  ----------- -----------
2           6-4-25-9     6-24-24-10  4.50         .125        4.25
----------- -----------  ----------- -----------  ----------- -----------
18          6-24-24-10   6-14-24-10  4.50         .125        1.34
----------- -----------  ----------- -----------  ----------- -----------

----------- -----------  ----------- -----------  ----------- -----------
7           6-14-24-10   3-6-24-10   3.50         .125        4.48
----------- -----------  ----------- -----------  ----------- -----------
17          3-6-24-10    16-36-23-11 3.50         .125         .65
----------- -----------  ----------- -----------  ----------- -----------

----------- -----------  ----------- -----------  ----------- -----------
14          7-30-24-9    6-30-24-9   2.50         .125         .15
----------- -----------  ----------- -----------  ----------- -----------
15          13-2-24-10   12-11-24-10 2.50         .125         .80
----------- -----------  ----------- -----------  ----------- -----------
16          12-11-24-10  6-14-24-10  2.50         .125         .80
----------- -----------  ----------- -----------  ----------- -----------
     Total 4.50 inch line = 5.59
     Total 3.50 inch line = 5.13
     Total 2.50 inch line = 1.75

</TABLE>

Replacement Value for Pipeline is projected at $15,000 per inch mile

Calculated As:                4.50*5.59)(15,000) = 377,325
                              3.50(5.13)(15,000) = 269,325
                              2.50(1.75)15,000) =   65,625

                 Total Replacement Value  $712,275

Establish Present Day Value at 75% of replacement value
to allow for repairs if necessary                      $534,206

Vendor's Value at 74.56% Interest =                    $398,300


                                    175
</Page>
<PAGE>

This is SCHEDULE "A" to an Agreement of Purchase and Sale dated March 19,
1999 between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser

Page 7



            Part VI   Authorizations for Expenditure For Which
                          Purchaser is Responsible
            ----------------------------------------------------

                                   [None]



                  Part VII   Preferential Purchase Rights
                  ---------------------------------------

                                   [None]

       Part VII   Processing, Treating, Transportation and Contract
                            Operating Agreements
       --------------------------------------------------------------

                                   [None]

                            Part IX   Penalties
                           ---------------------


                                   [None]


                                    176
</Page>
<PAGE>

This is SCHEDULE "B" to an Agreement of Purchase and Sale dated March 19,
1999 between STARROCK RESOURCES LTD.as Vendor and  PROMAX ENERGY INC.
As Purchaser



                             GENERAL CONVEYANCE
                           Cessford Area, Alberta

     This Conveyance made this 19th day of March,1999.

     BETWEEN.

  STARROCK RESOURCES LTD. having an office in the City of Calgary, in the
           Province of Alberta (hereinafter called the "Vendor")

                                  - and -

         PROMAX ENERGY INC., a body corporate, having an office in
              the City of Calgary,in the Province of Alberta
                    (hereinafter called the "Purchaser")

     WHEREAS the Vendor has agreed to sell and convey the Vendor's entire
right, title, estate and interest in the Assets to the Purchaser and the
Purchaser has agreed to purchase and accept all of the Vendor's right,
title, estate and interest in and to the Assets;

     THE PARTIES AGREE AS FOLLOWS:

1.   Definitions
     -----------
     In this Conveyance, including the recitals, "Agreement" means the
     Agreement of Purchase and Sale dated the 19th day of March, 1999,
     between the Vendor and the Purchaser. In addition, the definitions
     provided for in the Agreement are adopted in this Conveyance.

2.   Conveyance
     ----------

     The Vendor , for the consideration provided for in the Agreement, the
     receipt and sufficiency of which is acknowledged by the Vendor, sells,
     assigns, transfers and conveys the Initial Interest to the Purchaser,
     and the Purchaser purchases and accepts such interest from the Vendor,
     TO HAVE AND TO HOLD the same absolutely, subject to the terms of the
     Agreement, the Permitted Encumbrances and compliance with the terms of
     the Leases.

3.   Effective Time
     --------------

     This Conveyance is effective as of the Closing Date.


                                    177
</Page>
<PAGE>

4.   Subordinate Document
     --------------------
     This Conveyance is executed and delivered by the Parties pursuant to
     the Agreement for the purposes of the provisions of the Agreement, and
     the terms hereof shall be read in conjunction with the terms of the
     Agreement. The Agreement shall prevail if there is a conflict between
     the provisions of the Agreement and this Conveyance.

5.   Enurement
     ---------
     This Conveyance ensures to the benefit of and is binding upon the
     Parties and their respective successors and permitted assigns.

6.   Further Assurances
     ------------------
     Each Party shall, after the date of this Conveyance, at the request of
     the other Party and without further consideration, do all further acts
     and execute and deliver all further documents which are reasonably
     required to perform and carry out the terms of this Conveyance.

     IN WITNESS WHEREOF the Parties have duly executed this Conveyance.



                                     STARROCK RESOURCES LTD.


                                     PER: /S/ Al Langard
                                     ----------------------------------

                                     PER:
                                     ----------------------------------

                                     PROMAX ENERGY INC.

                                     PER: /S/ Robert Card
                                     ----------------------------------

                                     PER: /S/ J.R. MacMillan
                                     ----------------------------------

                                    178
</Page>
<PAGE>

This is SCHEDULE "C" to an Agreement of Purchase and Sale dated March 19,
1999, between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser



                 VENDOR'S/PURCHASER'S OFFICER'S CERTIFICATE
                --------------------------------------------

                         (REPRESENTATIONS ARE TRUE)


RE: Article 7.00 of the Agreement of Purchase and Sale ("Agreement") dated
March 19, 1999, between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY
INC. as Purchaser.

Unless otherwise stated, the definitions provided for in the Agreement are
adopted in this Certificate.

     I, (name), (position) of (name of party) ("the Vendor" or "the
     Purchaser") hereby certify that:

     1.   Each of the covenants, representations and warranties of the
          (Vendor/Purchaser) contained in Article 7.00 of the Agreement is
          true and correct in all material respects as of the Closing Date.

     2.   This Certificate is made for and on behalf of the Vendor and is
          binding upon it, and I am not incurring and will not incur any
          personal liability  whatsoever with respect to it.

     3.   This Certificate is made with full knowledge that the Vendor is
          relying on the same for the Closing of the transactions
          contemplated by the Agreement.

IN WITNESS WHEREOF I have executed this Certificate the 19th day of March,
1999.

____________________________       ____________________________
WITNESS                            (OFFICER'S NAME)


                                    179
</Page>
<PAGE>

This is SCHEDULE "D" to an Agreement of Purchase and Sale dated March 19,
1999, between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY INC. as
Purchaser


                       VENDOR'S OFFICER'S CERTIFICATE
                       ------------------------------

                          (NO SUBSTANTIAL DAMAGE)


RE: Article 9.00 of the Agreement of Purchase and Sale ("Agreement") dated
March 19, 1999, between STARROCK RESOURCES LTD, as Vendor and PROMAX ENERGY
INC. as Purchaser.


     Unless otherwise stated, the definitions provided for in the Agreement
are adopted in this Certificate.

     I, AL LANGARD, President of STARROCK RESOURCES LTD. ("the Vendor")
hereby certify that:

     1.   To the best of the information, knowledge and belief of the
          Vendor, there has been no damage to or alteration of the Assets
          between the Effective Date and the Closing Date that would
          materially and adversely affect the value of the Assets.

     2.   This Certificate is made for and on behalf of the Vendor and is
          binding upon it, and I am not incurring and will not incur any
          personal liability whatsoever with respect to it.

     3.   This Certificate is made with full knowledge that the Purchaser
          is relying on the same for the Closing of the transactions
          contemplated by the Agreement.

IN WITNESS WHEREOF I have executed this Certificate the 19th day of March,
1999.

        /S/ Al Langard"               AL LANGARD, PRESIDENT
       ---------------------         ----------------------------


                                    180
</Page>
<PAGE>
                                  RECEIPT
                                  (G.S.T.)

Starrock Resources Ltd. Hereby acknowledges receipt of the amount of
Twenty-Seven Thousand, Seven Hundred One Dollar and Eighty Cents
($27,701.80) from Promax Energy Inc. this day of March, 1999.


                                   Starrock Resources Ltd.
                                   Per: /S/ Al Langard
                                   -----------------------------



                                    181
</Page>

<PAGE>
                                  RECEIPT
                                  (G.S.T.)


Starrock Resources Ltd. Hereby acknowledges receipt of the amount of One
Million Eight Hundred Fifty Eight Thousand, Seven Hundred Sixty-Seven
Dollars and Seventy-Nine Cents ($1,858,767.79) from Promax Energy Inc. this
day of March, 1999.


                                   Starrock Resources Ltd.
                                   Per: /S/ Al Langard
                                   ----------------------------




                                    182
</Page>



<PAGE>

                      NEGATIVE PLEDGE AND UNDERTAKING
                     ---------------------------------


March 19, 1999

STARROCK RESOURCES l TD.
#900, 521- 3 Avenue S.W.
Calgary, Alberta
T2P 3T3


Dear Sirs:

In consideration of Starrock Resources Ltd. {the "Starrock") offering
options as set forth in the  Agreement of Purchase and Sale dated March 19,
1999 between Promax Energy Inc. and Starrock Resources Ltd., the
undersigned undertakes and agrees that it will from time to time, when
requested in writing by Starrock, and for so long as the said options
remain unexercised by PROMAX ENERGY INC., immediately execute and deliver
to, and in favour of Starrock, such further  security, in the form Starrock
requests on its assets and undertaking, whether now owned or hereafter
acquired, including, without limitation, security in the form of fixed
charges, floating charges, specific assignments of proceeds and contracts
and general assignments of debts.

The undersigned further undertakes and agrees that so long as the said
options remain available to PROMAX ENERGY INC., and until the undersigned
is released from its obligations under this letter of undertaking, it will
maintain its assets and undertaking free from any and all mortgages, liens,
charges, or security interests other than those granted to and in favour of
Starrock.

Given at the City of  Calgary, in the Province of Alberta


                                     PROMAX ENERGY INC.

                                     Per: /S/ Robert Card
                                     ----------------------------

                                     Per: /S/ J.R. McMillan
                                     ----------------------------



                                    183
</Page>
<PAGE>


                     PURCHASER'S OFFICER'S CERTIFICATE
                    -----------------------------------

                         (REPRESENTATIONS ARE TRUE)


RE: Article 7.00 of the Agreement of Purchase and Sale (" Agreement") dated
March 19, 1999, between STARROCK RESOURCES LTD. As Vendor and PROMAX ENERGY
INC. as Purchaser.

     Unless otherwise stated, the definitions provided for in the Agreement
are adopted in this Certificate.

     I, Robert L. Card, Chairman of the Board of Directors of Promax Energy
Inc. ("the Purchaser") hereby certify that:

     1.   Each of the covenants, representations and warranties of the
          Purchaser contained in Article 7.00 of the Agreement is true and
          correct in all material respects as of the Closing Date.

     2.   This Certificate is made for and on behalf of the Purchaser and
          is binding upon it, and I am not incurring and will not incur any
          personal liability whatsoever with respect to it.

     3.   This Certificate is made with full knowledge that the Purchaser
          is relying on the same for the Closing of the transactions
          contemplated by the Agreement.

IN WITNESS WHEREOF I have executed this Certificate the 19th day of March,
1999.

     /S/ J.R. MacMillan              /S/ Robert Card
    --------------------            --------------------
     WITNESS                         ROBERT L.CARD




                                    184
</Page>
<PAGE>

                       VENDOR'S OFFICER'S CERTIFICATE
                     ---------------------------------

                          (NO SUBSTANTIAL DAMAGE)

RE: Article 9.00 of the Agreement of Purchase and Sale ("Agreement") dated
March 19, 1999, between STARROCK RESOURCES LTD, as Vendor and PROMAX ENERGY
INC. as Purchaser.


     Unless otherwise stated, the definitions provided for in the Agreement
are adopted in this Certificate.

     I, AL LANGARD, President of STARROCK RESOURCES LTD. ("the Vendor")
hereby certify that:

     1.   To the best of the information, knowledge and belief of the
          Vendor, there has been no damage to or alteration of the Assets
          between the Effective Date and the Closing Date that would
          materially and adversely affect the value of the Assets.

     2.   This Certificate is made for and on behalf of the Vendor and is
          binding upon it, and I am not incurring and will not incur any
          personal liability whatsoever with respect to it.

     3.   This Certificate is made with full knowledge that the Purchaser
          is relying on the same for the Closing of the transactions
          contemplated by the Agreement.

IN WITNESS WHEREOF I have executed this Certificate the 19th day of March,
1999.

                                     /S/ Al Langard
                                     --------------------------
                                     AL LANGARD, PRESIDENT



                                    185
</Page>
<PAGE>

                       VENDOR'S OFFICER'S CERTIFICATE
                      -------------------------------

                         (REPRESENTATIONS ARE TRUE)

RE: Article 7.00 of the Agreement of Purchase and Sale ("Agreement") dated
March 19, 1999, between STARROCK RESOURCES LTD. as Vendor and PROMAX ENERGY
INC. as Purchaser.

     Unless otherwise stated, the definitions provided for in the Agreement
are adopted in this Certificate.

     I, Al Langard, President, of Starrock Resources Ltd.. ("the Vendor")
hereby certify that:

     1.   Each of the covenants, representations and warranties of the
          Vendor contained in Article 7.00 of the Agreement is true and
          correct in all material respects as of the Closing Date.

     2.   This Certificate is made for and on behalf of the Vendor and is
          binding upon it, and I am not incurring and will not incur any
          personal liability  whatsoever with respect to it.

     3.   This Certificate is made with full knowledge that the Vendor is
          relying on the same for the Closing of the transactions
          contemplated by the Agreement.

IN WITNESS WHEREOF I have executed this Certificate the 19th day of March,
1999.


                                     /S/ Al Langard
                                     ------------------------
                                     AL LANGARD, PRESIDENT


                                    186
</Page>
<PAGE>

May 1, 1999

PROMAX ENERGY INC.

#810, 1122- 4th Street S.W.
Calgary , Alberta
T2M 1M1

Attention: Mr. Barclay Hambrook, President

Dear Mr. Hambrook

Re: Fixed and Floating Charge Debenture Granted by Promax Energy Inc.
("Promax") to Starrock Resources Ltd. ("Starrock")

In conjunction with the closing of the transactions contemplated in the
Agreement of Purchase and Sale dated March 19,. 1999 (" Agreement") between
Starrock and Promax, Promax granted Starrock a Fixed and Floating Charge
Debenture ("Debenture"), charging all property conveyed to Promax pursuant
to the Agreement. As per instructions from Starrock, we did not register
the Debenture with the Personal Property Registry of Alberta or by way of
caveat or security notice against any leases conveyed to Promax.  We have
been instructed by Starrock to inform Promax that it is terminating the
Debenture.  The cancellation of the Debenture does not, however, abrogate,
extinguish or diminish the obligations of Promax pursuant to the Agreement.

Sincerely,

/S/ Al Langard
------------------
AL LANGARD



                                    187
</Page>
<PAGE>
/Letterhead/
                        DRUMMOND PHILLIPS & SEVALRUD
                          Barristers & Solicitors
                                                             Allan L. Holme
                                                      Direct Line: 221-8705
                                                    Assistant: Linda Wilson
                                                      Direct Line: 221-8719
                                                  Our File No: 12771/06/MJL

April 5, 1999

Mr. Al Langard
Starrock Resources Ltd.
Box 19, Site 10, RR 4
Calgary , Alberta
T2M 4L4

Dear  Mr. Langard:

Re: Sale by Starrock Resources Ltd. ("Starrock") to Promax Energy Inc.
("Promax")of Assets in Cessford Area of Alberta

We confirm completion of the above noted matter and accordingly enclose
herewith the following:

     1.   fully executed copy of the Fixed and Floating Charge Debenture
          granted by Promax to Starrock, charging all property  in
          Schedule" A" and after acquired property in the "Secured Property
          Area It as defined in item (k) on page 3;

     2.   our statement of account for services rendered herein.

We confirm your previous instructions during our meeting of March 8, 1999,
that we are not to register the enclosed debenture at the Personal Property
Registry of Alberta or by way of caveat or security notice against the
leases.  However, we have recommended that such registrations be effected
to protect Starrock's security and maintain its priority over other
creditors of Promax or third party purchasers of  the assets.  We will
await your further instructions in this regard.

We understand that you have complete copies of all other closing
documentation. Should you require another copy of any of the closing
documents, please do not hesitate to contact our office directly.

We trust you will find the foregoing and enclosed satisfactory and thank
you for allowing us to be of service to you in this matter.

Yours very truly,

DRUMMOND, PHILLIPS & SEVALRUD

/S/ Allan Holme

ALLAN L. HOLME


             900, 521 3rd Avenue S.W. Calgary, Alberta T2P 3T3
          E-mail: dpslaw@telusplanet.net  Facsimile: 403.264.6654
                          Telephone: 403.221.8700

                                    188
</Page>
<PAGE>
                    FIXED AND FLOATING CHARGE-DEBENTURE
                    ------------------------------------
1.   PROMAX ENERGY INC., a corporation incorporated having an office in the
     City of Calgary, in the Province of Alberta (hereinafter called the
     "Corporation"), for value received as security for the Corporation's
     obligations under an Agreement of Purchase and Sale dated March 19,
     1999 between the Corporation and Starrock Resources Ltd. ('' Agreement
     of Purchase and Sale"), hereby acknowledges itself indebted and
     promises to pay to STARROCK RESOURCES LTD. (who and whose successors
     and assigns as holders of this Debenture are hereinafter collectively
     called the "Holder"), the sum of FOUR MILLION NINE HUNDRED AND FORTY
     TWO THOUSAND SEVEN HUNDRED AND SIXTY-EIGHT DOLLARS AND THIRTY FIVE
     CENTS ($4,942,768.35) being the Option Interest Purchase Price and
     also to pay to the Holder the Exercise Bonus Amount(s) payable under
     the Agreement of Purchase and Sale, in lawful money of Canada
     (hereinafter called the "principal sum") at #900,  521- 3 A venue S.
     W. , the City of Calgary, in the Province of Alberta, Canada.


2.   In this Debenture, including this clause and any schedules hereto,
     unless there is something in the subject matter or context
     inconsistent therewith :

     (a)  "Governmental Requirement" means any law, statute, code,
          ordinance, order, rule, regulation, judgment, decree, injunction,
          franchise, permit, certificate, licence, authorization or other
          direction or requirement (including, without limitation, any of
          the foregoing which relates to environmental standards or
          controls, energy regulations and occupational safety and health
          standards or controls) of any federal, provincial, county,
          municipal or other government, department, commission, board,
          court, agency or any other instrumentality or any of them, that
          exercises jurisdiction over the Corporation or any part of the
          Mortgaged Premises;

     (b)  "hydrocarbons" means solid, liquid and gaseous hydrocarbons and
          any natural gas whether consisting of a single element or of two
          or more elements in chemical combination or uncombined and any
          other substances, whether a hydrocarbon or not, produced in
          association therewith and, without restricting the generality of
          the foregoing, includes oil-bearing shale, tar sands, crude oil,
          petroleum, helium and hydrogen sulphide;

     (c)  "lien hereto" or "lien hereof" or "lien of this Debenture" means
          the security created or expressed to be created or required to be
          created by the Corporation by any provision of this Debenture;


     (d)  "Mortgaged Premises" and "Mortgaged Property" mean all of the
          undertaking, property and assets, both present and future, of the
          Corporation, of whatsoever nature and kind and wheresoever
          situated, that are from time to time subject to any security
          interests, mortgages, liens, assignments, transfers,
          hypothecations, pledges or charges created under or secured by
          this  Debenture" or by any indenture supplementary hereto and
          includes the Specifically Mortgaged Property and the Specifically
          Assigned Property.

     (e)  "Operating equipment" means all surface and subsurface machinery,
          apparatus, equipment, facilities and other property and assets of
          whatsoever nature and kind (excluding drilling rigs, service

                                    189
</Page>
<PAGE>

          rigs, trucks, automotive equipment or other property or assets
          taken on the said lands or any part thereof to drill, service,
          stimulate or rework any well or wells or to conduct any other
          temporary operations on the said lands relative to exploring for
          or producing hydrocarbons) now or hereafter located on any of the
          said lands that are used or useful for the production, treatment,
          storage or transportation of any of the hydrocarbons including,
          without limiting the generality of  the foregoing, oil wells, gas
          wells, water wells, injection wells, disposal wells, casing,
          tubing, rods, pumps and pumping equipment, christmas trees and
          other wellhead equipment, separators, flow lines, tanks,
          treaters, heaters, plants and systems to gather, treat and/or
          compress hydrocarbons, plants and systems to treat, dispose of or
          inject water or other substances, power plants, poles, lines,
          transformers, starters, controllers, machine shops, tools, spare
          parts and spare equipment, telegraph, telephone, radio and other
          communication equipment, racks, storage facilities, land records,
          contracts and seismic and geological data;

     (f)  "permitted encumbrances" means:

          (i)  liens for taxes not yet due or the validity of which is
               being contested in good faith by the Corporation and liens
               for the excess of the amount of any past due taxes for which
               a final assessment has not been received over the amount of
               such taxes as estimated by a responsible representative of
               the Corporation and in respect of which the Corporation has
               set aside cash reserves sufficient to fully pay and satisfy
               the same;

          (ii) undetermined or inchoate liens or charges incidental to
               current operations which have not at the time been duly
               registered in accordance with applicable law against the
               Corporation or its property and of which no notice has been
               served upon the Corporation in accordance with such law and
               in respect of which the Corporation has set aside cash
               reserves sufficient to fully pay and satisfy the same;


          (iii)liens incurred or created in the ordinary course of business
               on the Specifically Mortgaged Premises in favour of any
               other person who is conducting the development or operation
               of the Specifically Mortgaged Premises the cost of which
               would otherwise have been paid by the Corporation and in
               respect of which the Corporation has set aside cash reserves
               sufficient to fully pay and satisfy the same;

          (iv) pooling or unitization agreements hereinafter entered into
               by the Corporation in the ordinary course of business
               covering any part of the Specifically Mortgaged Premises;


          (v)  assignments now or at any time hereinafter made by the
               Corporation to the Holder covering all or any part of the
               petroleum and natural gas rights owned from time to time by
               the Corporation whether or not the same form part of the
               Specifically Mortgaged Premises or otherwise, such
               assignments being made as collateral security for any
               present or future debts, liabilities or obligations of the
               Corporation to the Holder'

                                    190
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          (vi) easements or rights in land granted to public utilities,
               pipe line owners, common carriers or similar bodies or to
               any municipality or governmental or other public authority
               which are not of such nature as to prevent or materially
               affect the use, for the purposes of the Corporation, of the
               Specifically Mortgaged Premises that is subject thereto;

          (vii) any interest of a third party under any pooling, unit,
               development, farmout, royalty or operating agreement
               affecting the petroleum and natural gas rights forming part
               of the Specifically Mortgaged Premises in effect at the date
               hereof,

        (viii) any lease or sublease of substances other than
               hydrocarbons granted by the Corporation; provided that any
               such lease or sublease does not interfere with the enjoyment
               by the Corporation of the Specifically Mortgaged Premises;

          (ix) any right of first refusal contained in any instrument
               affecting petroleum and natural gas rights comprising part
               of the Specifically Mortgaged Premises that is customary in
               the oil and gas industry in Canada; and

          (x)  any general and specific assignment now or at any time
               hereafter made by the Corporation to the Holder of the book
               debts and accounts receivable of the Corporation to secure
               any of the present or future debts, liabilities or
               obligations of the Corporation to the Holder;

     (g)  "Person" means any individual, corporation, partnership,
          joint venture, association, joint stock  company, trust,
          unincorporated organization, government or any agency or
          political subdivision  thereof, or any other form of entity
          recognized by law;

      (h) "petroleum and natural gas right" means any leasehold, permit,
          working royalty, overriding royalty, net profits, fee, mineral or
          other interest, estate or right in or in respect of any
          hydrocarbons including, without restricting the foregoing, any
          interest of the Corporation described in Schedule "A" hereto, .

     (i) "Receiver" means any receiver of all or any part of the Mortgaged
          Premises appointed pursuant to clause 17 hereof either by the
          Holder or by a court having jurisdiction and includes a receiver-
          manager;

     (j) "said lands" means all of those lands in or in respect of which
          the Corporation now holds or hereafter acquires a petroleum and
          natural gas right and includes those lands that are described in
          Schedule "A" hereto;

     (k) "Secured Property Area " means the geographic area described as
          Townships 23, 24, 25, 26 and Ranges 7, 8, 9, 10, all West of the
          Fourth Meridian;

     (l) "Specifically Assigned Property" means the hydrocarbons, together
          with the proceeds therefrom and receivables and all other monies
          accruing from time to time to the Corporation in respect of the
          Specifically Mortgaged Premises or any of them and referred to in
          subclause 4(b) hereof,
                                    191
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<PAGE>
     (m) "Specifically Mortgaged Premises" or "Specifically Mortgaged
          Property" means the properties, interests, rights and privileges
          of the Corporation set forth in subclause 4(a) hereof; and

     (n) "this Debenture", "hereby", "hereof" and "hereunder" means this
          instrument and every instrument entered into supplementary hereto
          or in implementation hereof;

     (o)  all initially capitalized terms used and not otherwise defined
          herein shall have the meanings ascribed to those terms in the
          Agreement of Purchase and Sale.

3.   This Debenture is not one of a series of debentures but is a
     single debenture, and no other debenture or other security (save and
     except for permitted encumbrances) shall rank in priority over or pari
     passu with this Debenture as a charge upon the interest of the
     Corporation in the Mortgaged Premises except any security granted by
     the Corporation to Holder.

4.   As security for the payment of the principal sum, interest and all
     other monies from time to time secured hereby and as security for the
     performance and observance of the covenants, obligations and
     agreements on the part of the Corporation contained in this Debenture:

     (a ) the Corporation hereby grants, conveys, assigns, transfers, sets
          over, pledges, mortgages and charges as and by way of a first,
          fixed and specific mortgage, assignment and charge to and in
          favour of the Holder (subject only to the exception as to
          leaseholds hereinafter contained), the right, title and interest
          of the Corporation equal to the Unexercised Option Interest in
          and to:

          (i) the lands described in Schedule "A" hereto;

          (ii) the petroleum and natural gas rights held by the Corporation
               in the lands including the petroleum and natural gas rights
               of the Corporation described in Schedule "A" hereto;

          (iii)all lands that are or may be pooled or unitized with the
               lands described in Schedule "A" hereto;

          (iv) all operating equipment located on the lands described in
               Schedule "A"'

          (v)  all leases, licences, permits, reservations, agreements,
               authorizations and other instruments under which the
               Corporation derives, holds, operates or maintains the
               petroleum and natural gas rights in the lands described in
               Schedule "A" and all rights, benefits, privileges and
               advantages of the Corporation to be derived therefrom;

          (vi) all contracts for the purchase or utilization of
               hydrocarbons from or allocated to the lands described in
               Schedule "A"; and

          (vii) all servitudes, leases, licences, privileges, easements,
               rights-of-way, rights of ingress or egress and other surface
               rights under which the Corporation derives or holds the
               right to drill for, produce, store,  gather, treat or
               process hydrocarbons upon or in respect of the lands
               described in Schedule "A"'

                                    192
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<PAGE>
     (b)  the Corporation hereby grants, bargains, sells, pledges, assigns,
          transfers, sets over and delivers unto the Holder, the right,
          title and interest equal to the Unexercised Option Interest now
          held and hereafter acquired by the Corporation in and to the:

          (i)  all hydrocarbons produced from or allocated to the interest
               of the Corporation in the lands described in Schedule "A",

          (ii) all monies and proceeds derived from the sale or utilization
               of the hydrocarbons referred to in paragraph (i) of
               subclause 4(b) hereof;

          (iii) all monies receivable under contracts for the purchase,
               operation or utilization of hydrocarbons from or allocated
               to the interest of the Corporation in the lands described in
               Schedule "A"; and

          (iv) all proceeds accruing to the credit of the Corporation from
               time to time as a result of its ownership or operation of
               its interest in the petroleum and natural gas rights in the
               lands described in Schedule "A"; and

     (c)  the Corporation hereby mortgages, pledges and charges as and by
          way of a floating charge to and in favour of the Holder (subject
          to the exception as to leaseholds hereinafter contained) and
          grants a security interest to the Holder in

          (i)  the Corporation's estate and interest (equal to the
               Unexercised Option Interest) in any real  property, both
               present and future located within or forming part of the
               Secured Property Area; and

          (ii) an interest (equal to the Unexercised Option Interest) in
               the Corporation's undertaking and all of the property and
               assets of the Corporation for the time being, both present
               and future, of whatsoever nature and kind and wheresoever
               situated

          (other than such property, assets, hydrocarbons and revenues of
          the Corporation as are validly and effectively subject to the
          fixed and specific mortgage, assignment and/or charge under
          subclauses (a) and (b) of this clause 4 or under any supplemental
          indenture hereto), including, without in any way limiting or
          restricting the generality      of the foregoing, its uncalled
          capital and all present and future incomes, monies, sources of
          money, revenues, rents, creditors, accounts receivable, book
          debts, negotiable and non-negotiable instruments, shares, stocks,
          bonds, debentures, securities, choses in action, goodwill, trade
          marks, patents and patent rights, processes, inventions,
          franchises, powers, privileges, licences and all other property
          and things of value, real or personal, tangible or intangible,
          legal or equitable, that the Corporation may be possessed of or
          entitled to or that may at any time hereafter be acquired by the
          Corporation.

     TO HAVE AND TO HOLD the Mortgaged Premises and rights hereby conferred
     on the Holder for the use and purposes and with the power and
     authority and subject to the terms, conditions, provisos, covenants
     and stipulations herein expressed.

                                    193
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<PAGE>

     The mortgages and charges created and secured hereby shall not extend
     or apply to the last day of the term of any lease, whether oral or
     written, now held or hereafter acquired by the Corporation but should
     such mortgages or charges become enforceable and the Holder shall have
     determined to enforce the same, the Corporation shall thereafter stand
     possessed of such last day and shall hold it in trust to assign the
     same to any person who may acquire such term or the part thereof
     hereby mortgaged and charged in the course of any enforcement of the
     said mortgages and charges or any realization of the subject matter
     thereof.

     Notwithstanding the provisions contained in this clause 4, the
     Corporation shall remain liable to perform and observe all of its
     duties and obligations in respect of the Mortgaged Property to the
     same extent as if this Debenture had not been executed and the
     exercise by the Holder of any of its rights under this clause 4 shall
     not release the Corporation from performing and observing such duties
     and obligations and the Holder shall have no liability for the
     performance or observance of such duties or obligations by reason only
     of the execution and delivery of this Debenture.

5.   (a)  All parties producing, purchasing, taking, processing or
          receiving any hydrocarbons produced from or allocable to the
          interest of the Corporation in the said lands, or having in their
          possession any such hydrocarbons or proceeds therefrom, for which
          they or others are accountable to the Holder by virtue of the
          provisions of this Debenture, are authorized and directed to
          treat and regard the Holder as the assignee and transferee of the
          Corporation and entitled in the place and stead of the
          Corporation to receive the said hydrocarbons and the proceeds
          therefrom and are authorized and directed to remit all such
          proceeds directly to the Holder. and such parties and each of
          them shall be fully protected in so treating and regarding the
          Holder as such assignee and transferee and shall be under no
          obligation to see to the application by the Holder of any such
          proceeds received by it. The Corporation will, at the request of
          the Holder, furnish the Holder with the names of all parties
          purchasing or receiving such hydrocarbons and the names of all
          parties having in their possession such hydrocarbons or proceeds
          therefrom for which they or others are accountable to the Holder
          by virtue of this Debenture.

     (b)  If the Corporation shall receive all or any portion of the
          proceeds of any sale or utilization of hydrocarbons or other
          monies that under subclause 4(b) hereof have been assigned to the
          Holder, the Corporation will hold such proceeds in trust for the
          Holder and will forthwith cause such proceeds to be remitted to
          the Holder.

     (c)  The Corporation will execute, if and whenever requested by the
          Holder, transfers and division orders and all other appropriate
          instruments for the purpose of effecting the assignment made by
          the Corporation by subclause 4(b) hereof and the payment to the
          Holder of the production, proceeds and monies so assigned. The
          Corporation covenants to warrant and forever defend the title of
          the Holder to all proceeds of hydrocarbons and to all other
          monies received in accordance with the provisions hereof by the
          Holder and to hold the Holder and the purchaser or purchasers of

                                    194
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<PAGE>
          such hydrocarbons harmless against all liability and expense on
          account of any adverse claim asserted to any of such proceeds or
          monies. The covenants and indemnity in this subclause 5(c)
          contained and the lien hereof to secure the same shall survive
          and continue in full force and effect notwithstanding the payment
          of the principal sum, interest and other monies secured hereby
          and the release of the security of this Debenture.


     (d)  All monies received by the Holder pursuant to the assignment
          contained in subclause 4(b) hereof shall be applied towards
          payment of the principal sum, interest and other monies secured
          hereby.

     (e)  Any monies received by the Holder pursuant to this Debenture and
          remaining after payment in full of the principal sum, interest
          and of all other monies secured hereby shall, subject to the
          rights of other creditors of the Corporation, be paid to the
          Corporation, free of the assignment contained in subclause 4(b)
          hereof and without further obligation hereunder with respect
          thereto.

     (f)  The Holder shall not be liable to ascertain the purchasers and
          the other persons liable for the payment of the proceeds and
          other monies assigned under subclause 4(b) hereof, or for its
          failure to collect or exercise diligence in collecting funds
          assigned hereunder and shall be accountable only for sums
          actually received by the Holder.

     (g)  Nothing contained in this clause 5 shall, or shall be deemed, to
          limit the scope or effect of clause 4  hereof, or to detract from
          or limit the rights or remedies of the Holder under the
          provisions hereof including, without limitation, the right of the
          Holder, through a Receiver or otherwise, to collect and receive
          as part of the income from the Specifically Mortgaged Property
          all of the Corporation's income from the said lands, contracts,
          interests and rights described or referred to in clause 4 hereof.

     (h)  Nothing contained herein shall detract from or limit the absolute
          obligation of the Corporation to make payment of all monies owing
          hereunder at the time and in the manner provided herein and to
          perform or observe hereunder, regardless of whether the proceeds
          or production assigned by subclause 4(b) hereof are sufficient to
          pay the same, or whether the assignment herein is operative or
          whether the proceeds or production assigned by subclause 4(b)
          hereof have been applied in accordance with the foregoing
          provisions of this clause 5, and the rights under this clause 5
          shall be in addition to all other security of any and every
          character now or hereafter held by the Holder for the obligations
          of the Corporation secured hereby.

      (i) Whenever the principal sum, interest and other monies hereby
          secured shall have been paid in full and all covenants contained
          in this Debenture shall have been fulfilled, all to the
          satisfaction of the  Holder, then the assignment contained in
          subclause 4(b) hereof shall become void and of no effect and the
          Holder, upon request of the Corporation, shall execute and
          deliver to, and at the expense of, the Corporation an
          instrument of release and satisfaction of the assignment
          contained in subclause 4(b) hereof. Until the purchaser of any
          hydrocarbons that are the subject of the lien hereof or other
                                    195
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<PAGE>
          person liable for the payment of monies assigned by the terms of
          subclause 4(b) hereof shall have received a certified copy of
          such an instrument of release and satisfaction or other contrary
          instructions from the Holder, such purchaser or other person
          shall make payment in accordance with the authorization and
          direction of this clause. The assignment evidenced by subclause
          4(b) hereof shall also become void and of no effect with respect
          to any of the Specifically Mortgaged Property that is sold on
          enforcement of this Debenture, whether pursuant to the powers
          herein provided for or pursuant to an order of a court having
          jurisdiction.

6.   Unless and until an Event of Default shall have occurred and be
     continuing and the Holder shall have determined to enforce the
     security hereof, the Corporation shall be permitted, in the same
     manner and to the same extent as if this Debenture had not been
     executed, but subject to the express terms hereof, to possess,
     operate, manage, use and enjoy the Mortgaged Premises (except for the
     Specifically Assigned Property that has been assigned to the Holder
     pursuant to subclause 4(b) hereof), to exercise discretion with
     respect to the drilling of or participation in wells relating to the
     petroleum and natural gas rights, to produce and sa'/e the
     hydrocarbons comprised therein and freely to control its business.

7.   The Corporation represents and warrants to the Holder as follows:

     (a)  The Corporation is a corporation duly organized, legally
          existing  and in good standing under the laws of the Province of
          Alberta and is duly authorized to do business in each other
          jurisdiction where a failure so to qualify would have a
          materially adverse effect on the business or operations of the
          Corporation.

     (b)  The Corporation is duly authorized and empowered to execute,
          deliver and perform its obligations under this Debenture and all
          corporate action on the part , of the Corporation for the due
          execution, delivery and performance by the Corporation of this
          Debenture has been duly and effectively taken.

      (c) The Corporation has all rights purported to be vested in it or
          any of its predecessors in title under each and every one of the
          documents and instruments under which it derives and holds its
          petroleum and natural gas rights in the said lands and its rights
          to the production and revenues in respect thereof and that are
          subject to the security hereof and all of such documents and
          instruments are in full force and effect in accordance with their
          terms.

     (d)  This Debenture constitutes the valid and binding obligation of
          the Corporation, enforceable in accordance with its terms (except
          that such enforcement may be subject to any applicable
          bankruptcy, insolvency or similar laws generally affecting the
          enforcement of creditors' rights and that specific performance of
          equitable remedies is subject to the discretion of the courts
          before which such remedies are sought).

     (e)  This Debenture does not and will not violate any provisions of
          the articles or certificate of incorporation or continuance, as
          the case may be, or the by-laws of the Corporation, or any
          contract, agreement, instrument or Governmental Requirement to
          which the Corporation is subject or result in the creation or

                                    196
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<PAGE>
          imposition of any lien upon the Mortgaged Premises, other than
          the lien of this Debenture and any lien created by the permitted
          encumbrances.

     (f)  No registration or filing with, or approval  by, or consent of,
          any Person is required to be made or obtained by the Corporation
          in connection with the execution, delivery or performance of this
          Debenture, except as may be necessary to perfect the lien hereof.

     (g)  The Corporation has good and marketable title to the Mortgaged
          Property that is subject to the lien  hereof, free from any lien,
          charge,  encumbrance, claim, or notice, except for permitted
          encumbrances and the lien of this Debenture.

     (h)  The Corporation :

          (i)  is not in violation of any Governmental Requirement; and

          (ii) has not failed to obtain any licence, permit, franchise or
               other governmental authorization necessary to its ownership
               of the Mortgaged Premises or the conduct of its business,
               which violation or failure would have (in the event such
               violation or failure were asserted by any Person through
               appropriate action) a material adverse effect upon the
               business or operations of the Corporation.


8.   The Corporation covenants and agrees with the Holder:

     (a ) to warrant and forever defend all and singular the Mortgaged
          Premises unto the Holder against every person whosoever lawfully
          claiming or attempting to claim the same or any part thereof, .

     (b)  to pay the principal sum, interest and other monies hereby
          secured, together with other appurtenant charges thereon, in
          accordance with the terms of this Debenture;

     (c)  to carry on and continuously conduct its business in respect of
          the Mortgaged Premises in a lawful, efficient, diligent and
          businesslike manner and in accordance with good oilfield
          practice;

     (d)  to keep and maintain proper books of account and records
          accurately covering all aspects of the business and affairs of
          the Corporation relating to the Mortgaged Premises and to permit
          authorized officers, employees or agents of the Holder to inspect
          the same during regular business hours;

     (e)  to advise the Holder in writing of the particulars of any
          acquisition by the Corporation of an interest in land located
          within the Secured Property Area, such particulars to be
          sufficiently detailed to the Holder's satisfaction;

     (f)  to fully pay and discharge as and when the same become due and
          payable all taxes (including local improvement rates), rates,
          duties and assessments that may be levied, rated, charged or
          assessed against the Corporation, or the Mortgaged Premises, or
          any part thereof, and if the Corporation fails to pay any of such
          taxes, rates, duties or assessments and if it is not in good
          faith contesting the same, the Holder may  pay, but shall not be
          obligated to pay, the same and any amounts so paid by the Holder
          shall become and form part of the principal sum secured hereby
          and shall bear interest at the rate aforesaid until paid; and
                                197 </Page>
<PAGE>
     (g)  to give notice to the Holder promptly of any Event of Default or
          of any event which with notice or lapse of time, or both, would
          constitute an Event of Default hereunder.

9.   The Corporation further covenants and agrees with the Holder as
     follows:

     (a)  The Corporation will keep and maintain in good standing all
          petroleum and natural gas rights that are subject to the lien
          hereof and will observe and perform all of its covenants and
          obligations under the instruments evidencing the same to the
          extent necessary to preserve the value of the Mortgaged Premises
          and in particular will to the extent necessary as aforesaid, in
          timely fashion pay all rentals, delay rentals, royalties and
          other charges accruing and payable from time to time thereunder.

     (b)  The Corporation will conduct all drilling and production
          operations on the said lands in such a manner as to comply with
          the respective covenants and obligations contained in the various
          instruments under which it derives and holds its interest .in the
          said lands.

     (c)  The Corporation will not, without the prior written consent of
          the Holder, surrender, quit claim or permit to lapse any document
          or instrument assigned and pledged under subclause 4(a) hereof
          if, as a result thereof, the value of the Specifically Mortgaged
          Property would be diminished.

     (d)  The Corporation will maintain in good standing and will observe
          and perform all of its covenants and obligations under any
          agreement or instrument forming part of the Specifically
          Mortgaged Property now in existence or hereafter entered into by
          the Corporation and that is subject to the lien hereof.

     (e)  The Corporation will keep in good standing all rights-of-way,
          rights-of-access, surface leases and other surface rights upon
          and across the said lands that are necessary or required in
          connection with the operations being carried on by or for the
          account of the Corporation thereon for the production, treating,
          storing or transporting of  hydrocarbons and the Corporation will
          not abandon or dispose of the same, if they are necessary or
          desirable for the proper and efficient operation of the
          Specifically Mortgaged Property.

     (f)  The Corporation will keep and maintain in good repair and
          condition all of the operating equipment reasonably necessary for
          the production, treating, transporting and storage of
          hydrocarbons produced from or allocated to the said lands and
          will not abandon or dispose of the same if they are necessary or
          useful in the proper and efficient operation of the Specifically
          Mortgaged Property, except upon substitution therefore other
          equipment adequate for those purposes.

     (g)  The Corporation will maintain and protect from diminution the
          productive capacity of each producing well on the said lands, but
          shall not be prevented from shutting in or abandoning a well that
          is not economic to produce.

     (h)  The Corporation will cause to be afforded to one or more
          authorized representatives of the Holder, the opportunity at any
          reasonable time during business hours to make such inspection as
          such representative or representatives shall deem proper of any
                                    198
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<PAGE>
<PAGE>
          of the Mortgaged Premises to the extent that the Corporation
          itself is entitled to inspect the Mortgaged Premises.


     (i)  The Corporation will not, without the prior written consent of
          the Holder, make or permit to be made any material amendment to
          or modification of any document or instrument that would have the
          effect of diminishing the value of the Specifically Mortgaged
          Property or of impairing the security of this Debenture.

     (j)  The Corporation will duly perform and observe all duties,
          covenants, agreements and obligations on its part to be performed
          or observed under all documents and instruments affecting,
          relating to or comprising a part of the Mortgaged Premises and,
          unless otherwise approved of in writing by the  Holder, the
          Corporation will maintain or cause to be maintained all such
          documents and instruments, insofar as and to the extent that they
          relate to the Mortgaged Premises, in full force and effect in
          accordance with their terms.

     (k)  The Corporation will punctually take all measures reasonably
          necessary in the circumstances to enforce promptly the
          performance and observance of the obligations of all other
          Persons under each of the leases, agreements, contracts,
          documents and other instruments constituting part of the
          Specifically Mortgaged Premises or pertaining or relating to the
          Specifically Mortgaged Premises.

      (l) The Corporation will from time to time and at any time, at the
          request of the Holder, furnish the Holder with any detailed
          information requested concerning the Mortgaged Premises as may be
          available to the Corporation.

     (m)  In the event of any damage or loss, from any cause whatsoever, to
          any  property, any interest in which is now or hereafter included
          in the Specifically Mortgaged Property, the Corporation will
          forthwith repair such damage and replace such loss unless the
          repair of such damage or the replacement of loss is unnecessary
          or uneconomic for the production of hydrocarbons from within,
          upon or under the said lands.

     (n)  The Corporation will proceed with due diligence to correct any
          defect in title to the Specifically Mortgaged Property should any
          such defect exist or be found to exist after the execution and
          delivery of this Debenture and will give immediate written notice
          of any such defect to the Holder upon becoming aware of such
          defect.

     (o)  The Corporation will ensure that all the duties, agreements and
          obligations performable by it under each contract constituting a
          part of, or applicable to, the Specifically Mortgaged Property
          are duly performed and will maintain each such contract in full
          force and effect, except with the prior written approval of the
          Holder.

     (p)  The Corporation will punctually take all measures reasonably
          necessary or desirable in the circumstances to enforce or cause
          to be enforced promptly the performance by the purchaser and
          other contracting parties under each contract constituting a part
          of, or applicable to, the Specifically rvlortgaged Property, of
          all of the obligations of the purchaser and other contracting
          parties under such contract.

                                    199
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<PAGE>
     (q)  Where, under the provision of any contract included or applicable
          to the Specifically Mortgaged  Property, the contracting party,
          other than the Corporation, may perform some act only with the
          permission of the Corporation, the Corporation will ensure that
          such approval or consent is not given unless the consent of the
          Holder is first obtained, if the doing of such act by that
          contracting party may have a material adverse effect on the
          security of this Debenture.

     10.  (a)  The Corporation covenants that at all times during the
          continuation of this security, it will keep such of the Mortgaged
          Premises that are of an insurable nature and are of a character
          usually insured by  companies owning or operating similar
          premises insured with responsible insurers, against loss or
          damage by fire and other causes customarily insured against by
          similar companies owning or operating the same or similar
          premises in Canada and within limits of coverage acceptable to
          the Holder. Unless otherwise agreed to in writing by the Holder,
          the losses under all such insurance shall be payable firstly to
          the Holder as its interest may appear.

     (b)  The Corporation agrees that so long as it remains indebted to the
          Holder, it will, unless otherwise requested in writing by the
          Holder, maintain with reputable insurers third party public
          liability and property damage insurance covering all operations
          of the Corporation within limits of coverage usually carried by
          owners owning or operating the same or a similar type and size of
          business as that being conducted by the Corporation.

     (c)  The Corporation will, upon the request of the Holder, deliver to
          the Holder certified copies of all policies or contracts of
          insurance being carried by the Corporation pursuant to the terms
          hereof, together with such certificates of insurance as the
          Holder may reasonably require and evidence that the premiums on
          all such insurance have been paid.

     (d)  If the Corporation should fail to take out or maintain all or any
          of the insurance required to be carried by the Corporation
          pursuant to the terms of this Debenture, the Holder may, but
          shall not be obliged to, take out some or all of such insurance
          and all sums expended by the Holder in effecting such insurance
          shall forthwith become due and be payable by the Corporation to
          the Holder and until paid shall form part of the principal sum
          secured hereby and shall bear interest at the aforesaid rate to
          the fixed and specific lien and charge hereof or as the Holder or
          its legal counsel deems necessary or advisable for the perfection
          and protection of the mortgages, liens, charges, assignments and
          all other security interests created or intended to be created
          hereby and the rights conferred or intended to be conferred upon
          the Holder under this Debenture. The Corporation, at its cost and
          expense, will cause this Debenture and all such supplementary and
          corrective instruments and other documents and assurances to be
          promptly filed and refiled,  registered and reregistered and
          deposited and redeposited, in such manner, in such offices and
          places and at such times and as often as may be required by law
          or as may be necessary or desirable to perfect and preserve the
          mortgages, liens, charges, assignments and all other security
          interests created or intended to be created hereby and the rights
          conferred or intended to be conferred upon the Holder under this
          Debenture, and will cause to be furnished promptly to the Holder
          evidence satisfactory to the Holder of such filing, registering
          and depositing, all at the cost and expense of the Corporation.
                                    200
</Page>
<PAGE>

14.  If the Corporation shall fail to perform any act that it is required
     to perform hereunder, or to pay any money that the Corporation is
     required to pay under the terms of this Debenture, including any
     expenses, payments and outlays incurred by the Holder hereunder, the
     Holder may perform or cause to be performed such act at the
     Corporation's expense, and may pay such money at the Corporation's
     expense, and thereupon, without prejudice to the rights of the Holder
     to damages and other remedies available at law or in equity hereunder
     or otherwise, the Corporation will immediately repay to the Holder all
     expenses so incurred and all amounts so paid by the Holder together
     with interest thereon, at a rate per annum set forth in clause 1
     hereof, from and after the date of incurring such expenses or the
     making of such payments.  The amount of all such expenses and payments
     together with interest thereon shall be added to the principal sum
     hereby secured and shall form a part of the same and shall be secured
     by this Debenture and, to the extent the Holder may be entitled to the
     same by way of subrogation, the rights against the Corporation of the
     Person who has received payment thereof from the Holder.


15.  If any one or more of the following Events of Default occurs, the
     Holder may, at its sole option, exercise and on all of the remedies
     available to it in this Debenture and the Agreement of Purchase and
     Sale and any other remedies available to it at law or in equity.

16.  The Holder may waive any breach by the Corporation of any of the
     provisions contained in this Debenture or any default by the
     Corporation in the observance or performance of any covenant,
     agreement or condition required to be kept, observed or performed by
     the Corporation under the terms of this Debenture; provided always
     that no act or omission of the Holder in the premises shall extend to
     or be taken in any manner whatsoever to affect any subsequent breach
     or default or to affect the rights of the Holder resulting therefrom.

17.  Nothing done by the Holder in possession of the Mortgaged Premises
     shall render the Holder a mortgagee in possession or responsible as
     such, or in any way limit or curtail the remedies of the Holder as a
     mortgagee or creditor under any applicable law or statute.

18.  If the security hereby constituted shall become enforceable, the
     Holder may, either before or after any  entry, sell and dispose of all
     or any part of the Mortgaged Premises either as a whole or in several
     portions thereof, at public auction or by public tender or by private
     sale at such time or times and on or subject to such terms and
     conditions as the Holder may determine, and it shall be lawful for the
     Holder to make such sale, either for cash or upon credit or partly for
     cash and partly upon credit, and with or without advertisement, and
     upon such reasonable conditions as to upset, reserve bid or price and
     as to terms of payment as the Holder may deem  proper, and the Holder
     may also rescind or vary any contract of sale that may have been
     entered into and resell with or under any of the powers conferred
     hereunder and adjourn any such sale from time to time and may execute
     and deliver to the purchaser or purchasers of the Mortgaged Premises
     or any part thereof good and sufficient title to the same, the Holder
     being hereby constituted irrevocably the attorney of the Corporation
     for the purpose of making such sale and for executing all deeds and
     documents appertaining thereto and any such sale made as aforesaid
     shall be a perpetual bar both at law and in equity against the
     Corporation and all other persons claiming the said property or any
     part thereof, by, from, through or under the Corporation.
                                    201
</Page>
<PAGE>

19.  Upon payment by the Corporation to the Holder of the principal sum,
     interest and all other monies secured by this Debenture and provided
     the security hereby constituted shall not have become enforceable, the
     Holder shall, upon written request of the Corporation, deliver up this
     Debenture to the Corporation and shall, at the expense of the
     Corporation, release and discharge the security hereby constituted and
     execute and deliver to the Corporation such deeds or other documents
     as shall be requisite to release and discharge this Debenture and the
     security afforded hereby, . provided, however, that this Debenture may
     be assigned, pledged, hypothecated or deposited by the Corporation as
     security for advances or loans to or for indebtedness or other
     obligations or liabilities (contingent or otherwise) of the
     Corporation and in such event this Debenture shall not be deemed to
     have been discharged or redeemed by reason of the account of the
     Corporation having ceased to be in debit balance while this Debenture
     remains so assigned, pledged, hypothecated or deposited.

20.  No postponement or partial release or discharge of the mortgage, lien
     and charge created under and secured by this Debenture in respect of
     all or any part of the Mortgaged Premises shall in any way operate or
     be construed so as to release and discharge the security hereby
     constituted in respect of the Mortgaged Premises except as therein
     specifically provided, or so as to release or discharge the
     Corporation from its liability to the Holder to fully pay and satisfy
     the principal sum, interest and all other monies due or remaining
     unpaid by the Corporation to the Holder.

21.  This Debenture is to be treated as a negotiable instrument and all
     persons are invited by the Corporation to act accordingly.


22.  The principal sum, interest and other monies hereby secured will be
     paid and shall be assignable free from any right of set-off or
     counterclaim or equity between the Corporation and the Holder.

23.  The security hereby constituted is in addition to, and not in
     substitution  for, any other security now or hereafter held by the
     Holder and no payment to the Holder shall constitute payment on
     account of the principal sum, interest or other monies from time to
     time owing hereunder unless specifically so appropriated in writing by
     the Holder. The taking of any action or proceedings or refraining from
     so doing, or any other dealing with any other security for the monies
     secured hereby shall not release or affect the charge of this
     Debenture and the taking of the security hereby granted or any
     proceedings hereunder for the realization of the security hereby
     granted shall not release or affect any other security held by the
     Holder for the monies hereby secured.

24.  Any notice that may be given by the Holder in accordance with this
     Debenture shall be in writing and may be given at any time either by
     delivering or by mailing the same addressed to the Corporation at
     #810,  1122- 4 Street  S.vV. , Calgary, Alberta T2M 1 M1. Any notice
     delivered to the Corporation shall be deemed to have been given on the
     business day during which the same was so delivered to the Corporation
     and any notice mailed to the Corporation shall be conclusively deemed
     to have been received by the Corporation on the third business day
     following that on which it was so mailed.

25.  This Debenture and all its provisions shall enure to the benefit of
     the Holder, its successors and assigns and shall be binding upon the
     Corporation, its successors and assigns.
                                    202
</Page>
<PAGE>

26.  Wherever the singular or masculine or neuter is used in this
     Debenture, the same shall be construed as meaning the plural or
     feminine or body corporate and vice versa, where the context or the
     parties so require.


     IN WITNESS WHEREOF the Corporation caused its corporate sea! to be
hereunto affixed and these presents to be signed by its proper officers
duly authorized in that behalf as of the 19th day of
March, 1999.


                                     PROMAX

                                     Per: /S/ Robert Card
                                     ----------------------------

                                     Per: /S/ J.R. MacMillan
                                     ----------------------------

                                    203
</Page>
<PAGE>

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------
                      Zones                  Vendor's
           P&NG       Included   Lease       Working    Operator
Location   Lease      in         Exiry       Interest   of
(W4M)      Number     Lease      Date        (%)        Lease     Encumbrances
<S>        <C>        <C>        <C>         <C>        <C>       <C>
------------------------------------------------------------------------------------
13-24-10   0493040044 Base Mann  4-1-99      74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
14-24-10   12286      Base                                        Crown Lessor
                      Viking     Indefinite  74.56                Royalty
           12286      Viking     4-29-99     74.56                Crown Lessor
           0495010055 Below                                       Royalty
                      Viking     1-5-00      37.28                Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
25-24-10   0496070046 All        7-11-01     74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
7-25-8     0499020043 All        2-3-04      74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
9-25-8     0498040318 All        4-30-03     74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
15-25-8    0492010234 Base Mann  Indefinite  45.31      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
16-25-8    0498040322 All        4-30-03     45.31      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
17-25-8    0498040323 All        4-30-03     74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
18-25-8    0499020044 All        2-3-04      50.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
20-25-8    0492010235 Base Mann  Indefinite  74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
21-25-8    0492010236 Base Mann  Indefinite  74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
28-25-8    0492010237 Base Mann  Indefinite  74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
1-25-9     0497100603 All        10-30-02    74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
4-25-9     38435      Base Mann  Indefinite  74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
5-25-9     12276      Base Mann  Indefinite  74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------
9-25-9     38435      Base Mann  Indefinite  74.56      Vendor    Crown Lessor
                                                                  Royalty
------------------------------------------------------------------------------------

</Page>
<PAGE>
------------------------------------------------------------------------------------
11-25-9**  0491070294 Base                              Vendor    Crown Lessor
                      Viking     Indefinite  74.56                Royalty
           0498040324 Below                             Vendor    Crown Lessor
                      Viking     04-30-03    74.56                Royalty
------------------------------------------------------------------------------------
12-25-9**  0491030315 Base                              Vendor    Crown Lessor
                      Viking     Indefinite  74.56                Royalty
           0498040325 Below                                       Crown Lessor
                      Viking     04-30-03    74.56                Royalty
------------------------------------------------------------------------------------
</TABLE>

All the above leases are subject to a 5% GORR





The leases marked with an ** are subject to an additional 6% GORR


                                         204
</Page>