EXHIBIT 2
                           PURCHASE AND SALE AGREEMENT

                                 BY AND BETWEEN

                        AMOCO PRODUCTION COMPANY, SELLER

                                       AND

                       HOWELL PETROLEUM CORPORATION, BUYER


                                           INDEX

Article 1.  DEFINITIONS...........................................   1

Article 2.  SALE AND PURCHASE
    2.1     Sale and Purchase.....................................   9

Article 3.  PURCHASE PRICE, DEPOSIT AND PREFERENTIAL RIGHTS
    3.1     Purchase Price........................................   9
    3.2     Deposit...............................................   9
    3.3     Preferential Rights To Purchase.......................   10

Article 4.  TITLE REVIEW
    4.1     Review of Title Records...............................   10
    4.2     Alleged Title Defects.................................   10
    4.3     Waiver ...............................................   11

Article 5.  INSPECTION OF PREMISES
    5.1     Inspection of Premises................................   11
    5.2     Alleged Adverse Conditions............................   11
    5.3     Waiver ...............................................   12

Article 6.  ACCOUNTING
    6.1     Revenues, Expenses and Capital Expenditures...........   13
    6.2     Taxes.................................................   13
    6.3     Obligations and Credits...............................   14
    6.4     Miscellaneous Accounting..............................   14
    6.5     Final Accounting Settlement...........................   14
    6.6     Post-Final Accounting Settlement......................   14

Article 7.  LOSS, CASUALTY AND CONDEMNATION
    7.1     Notice of Loss........................................   15
    7.2     Casualty and Condemnation.............................   15

Article 8.  ALLOCATION OF RESPONSIBILITIES AND INDEMNITIES
    8.1     Opportunity for Review................................   15
    8.2     Seller's Non-Environmental Indemnity Obligation.......   15
    8.3     Seller's Environmental Indemnity Obligation...........   16
    8.4     Buyer's Non-Environmental Indemnity Obligation........   17
    8.5     Buyer's Environmental Indemnity Obligation............   17
    8.6     Asbestos and NORM.....................................   18
    8.7     Buyer's Assumption of Obligations.....................   18
    8.8     Process Safety Management.............................   18
    8.9     Notice of Claims......................................   19
    8.10    Defense of Claims.....................................   19
    8.11    Waiver of Certain Damages.............................   20
    8.12    Limitation on Indemnities.............................   20

Article 9.  SPECIAL WARRANTY AND DISCLAIMERS
    9.1     Special Warranty of Title.............................   20
    9.2     Disclaimer - Representations and Warranties...........   20
    9.3     Disclaimer - Statements and Information...............   21

Article 10. SELLER'S REPRESENTATIONS AND WARRANTIES
    10.1    Organization and Good Standing........................   21
    10.2    Corporate Authority; Authorization of Agreement.......   21
    10.3    No Violations.........................................   22
    10.4    Absence of Certain Changes............................   22
    10.5    Operating Costs.......................................   23
    10.6    Litigation............................................   23
    10.7    Bankruptcy............................................   23

Article 11. BUYER'S REPRESENTATIONS AND WARRANTIES
    11.1    Organization and Good Standing........................   23
    11.2    Corporate Authority; Authorization of Agreement.......   23
    11.3    No Violations.........................................   24
    11.4    SEC Disclosure........................................   24
    11.5    Independent Evaluation................................   24
    11.6    Buyer's Reliance......................................   25

Article 12. ADDITIONAL COVENANTS AND CONSIDERATIONS
    12.1    Subsequent Operations.................................   25
    12.2    Financial Assurances..................................   25
    12.3    Transition Agreement..................................   25
    12.4    License Agreement(s)..................................   25
    12.5    Sublease Novation Agreement...........................   25
    12.6    Crude Call............................................   25
    12.7    NGL Call..............................................   27
    12.8    Rights-Of-Way and Surface Leases......................   27
    12.9    APL\Salt Creek Electrical Service ....................   28

Article 13. PERSONNEL MATTERS
    13.1    Employee Lists........................................   28
    13.2    Offer of Employment...................................   28
    13.3    Pension Plans.........................................   29
    13.4    Thrift Plan and Stock Purchase........................   29
    13.5    Other Employee Benefits...............................   30
    13.6    Accrued and Unused Vacation...........................   30
    13.7    Severance.............................................   30
    13.8    Post Transition Date Benefits.........................   31
    13.9    WARN Act..............................................   31

Article 14. HSR FILINGS
    14.1    HSR Filings...........................................   31

Article 15. CONDITIONS PRECEDENT TO CLOSING
    15.1    Conditions Precedent to Seller's Obligation to Close..   32
    15.2    Conditions Precedent to Buyer's Obligation to Close...   32
    15.3    Conditions Precedent to Obligation of Each Party to
            Close.................................................   32

Article 16. THE CLOSING
    16.1    Closing...............................................   33
    16.2    Obligations of Seller at Closing......................   33
    16.3    Obligations of Buyer at Closing.......................   35

Article 17. TERMINATION
    17.1    Grounds for Termination...............................   36
    17.2    Effect of Termination.................................   36
    17.3    Dispute over Right to Terminate.......................   36
    17.4    Return of Documents...................................   37
    17.5    Confidentiality.......................................   37

Article 18. ARBITRATION
    18.1    Arbitration...........................................   37

Article 19. MISCELLANEOUS
    19.1    Notices...............................................   38
    19.2    Conveyance Costs......................................   39
    19.3    Brokers' Fees.........................................   39
    19.4    Records...............................................   39
    19.5    Further Assurances....................................   40
    19.6    Survival of Representations and Warranties............   40
    19.7    Amendments and Severability...........................   40
    19.8    Successors and Assigns................................   40
    19.9    Headings..............................................   41
    19.10   Governing Law.........................................   41
    19.11   No Partnership Created................................   41
    19.12   Public Announcements..................................   41
    19.13   No Third Party Beneficiaries..........................   41
    19.14   Waiver of Consumer Rights.............................   41
    19.15   Not to be Construed Against Drafter...................   41
    19.16   Tax Deferred Exchange Election........................   42
    19.17   Conspicuousness of Provisions.........................   42
    19.18   Execution in Counterparts.............................   42
    19.19   Entire Agreement......................................   42
<PAGE>

                                   EXHIBITS

EXHIBIT "A" -  WORKING INTERESTS AND NET REVENUE INTERESTS
EXHIBIT "B" -  PREFERENTIAL PURCHASE  AND DEFECT ALLOCATION
EXHIBIT "C" -  MATERIAL CONTRACTS
EXHIBIT "D" -  GAS IMBALANCES
EXHIBIT "E" -  PARTNERSHIPS
EXHIBIT "F" -  EXCLUDED PROPERTIES - AFFILIATES
EXHIBIT "F-1" -EXCLUDED PROPERTIES - OTHER
EXHIBIT "G" -  CLAIMS, DISPUTES AND LITIGATION
EXHIBIT "H" -  ASSIGNMENT AND BILL OF SALE
EXHIBIT "I" -  SURFACE DEED
EXHIBIT "J" -  MINERAL DEED
EXHIBIT "K" -  CERTIFICATE
EXHIBIT "L" -  LETTERS-IN-LIEU
EXHIBIT "M" -  OPINION OF COUNSEL
EXHIBIT "N" -  NON-FOREIGN AFFIDAVIT
EXHIBIT "O" -  TRANSITION AGREEMENT
EXHIBIT "P" -  LICENSE AGREEMENT
EXHIBIT "Q" -  SUBLEASE NOVATION AGREEMENT
EXHIBIT "R" -  GUARANTEE AGREEMENT
EXHIBIT "S" -  CRUDE CALL TERMS

<PAGE>

                         PURCHASE AND SALE AGREEMENT


     THIS PURCHASE AND SALE AGREEMENT (this  "Agreement") is dated the 20th day
of  November,  1997,  by and  between  AMOCO  PRODUCTION  COMPANY,  a  Delaware
corporation,  with an office at 501 WestLake  Park  Boulevard,  Houston,  Texas
77079   (hereinafter   referred   to  as   "Seller")   and   Howell   Petroleum
Corporation,  a  Delaware  corporation,  with an office at 1111  Fannin,  Suite
1500, Houston,  Texas 77002-6923  (hereinafter referred to as "Buyer"),  and is
based on the following premises:

     WHEREAS,  Seller  desires  to sell,  assign  and convey to Buyer and Buyer
desires to  purchase  and accept  certain  oil and gas  properties  and related
interests; and

     WHEREAS,  the  parties  have  reached  agreement  regarding  such sale and
purchase.

     NOW,  THEREFORE,  for valuable  consideration and the mutual covenants and
agreements herein contained, Seller and Buyer agree as follows:

                            ARTICLE 1. DEFINITIONS

1.  Definitions:  In  this  Agreement,  capitalized  terms  have  the  meanings
provided  in  this  Article,  unless  expressly  provided  otherwise  in  other
Articles.  All defined  terms  include both the  singular  and the plural.  All
references  to  Articles  refer  to  Articles  in  this   Agreement,   and  all
references  to Exhibits  refer to Exhibits  attached to and made a part of this
Agreement.

     1.1   "Accounting Referee"  has the meaning set forth in Article 6.5.

     1.2   "Affiliate" means any entity that,  directly or indirectly,  through
one or more  intermediaries,  controls or is  controlled  by or is under common
control with the entity  specified.  Control  means  ownership of fifty percent
(50%) or greater of the voting stock of such entity.

     1.3   "Alleged  Adverse  Condition"  means an  environmental  or  physical
condition  asserted  by  Buyer in  accordance  with  Article  5.2  that,  as of
Closing  (as  hereinafter   defined),  is  not  in  compliance  with  the  then
existing  Laws  (as  hereinafter  defined),   and  the  costs  associated  with
remediating  such individual  Alleged Adverse  Condition  exceeds  Seventy-Five
Thousand  and  No/100  United  States  Dollars  (US  $75,000)  net to  Seller's
interests.   Notwithstanding  anything  contained  in  this  Agreement  to  the
contrary,  Buyer shall not be entitled  to raise an Alleged  Adverse  Condition
unless  the  aggregate  cost  associated  with  remediating  all  such  Alleged
Adverse  Condition(s)  exceeds  three percent (3%) of the  unadjusted  Purchase
Price (as  hereinafter  defined) (it being  acknowledged  and agreed that Buyer
shall be solely  responsible  for any and all Alleged  Adverse  Condition(s) up
to three (3%) percent of the unadjusted Purchase Price).

     1.4   "Alleged  Title  Defect"  means  a  Title  Defect  (as   hereinafter
defined)  which is asserted by Buyer in  accordance  with  Article 4.2, and the
costs  associated  with curing such  individual  Alleged  Title Defect  exceeds
Seventy-Five  Thousand  and No/100  United  States  Dollars (US $75,000) net to
Seller's  interests.  Notwithstanding  anything  contained in this Agreement to
the  contrary,  Buyer shall not be entitled  to raise an Alleged  Title  Defect
unless  the  aggregate  cost  associated  with  curing all such  Alleged  Title
Defect(s)  exceeds  three  percent (3%) of the  unadjusted  Purchase  Price (it
being  acknowledged  and agreed that Buyer shall be solely  responsible for any
and all Alleged  Title  Defect(s)  up to three (3%)  percent of the  unadjusted
Purchase Price).

     1.5   "Amoco Retirement Plan" has the meaning set forth in Article 13.3.

     1.6   "Amoco Savings Plan"  has the meaning set forth in Article 13.8.

     1.7   "Amoco Severance Plan" has the meaning set forth in Article 13.7.

     1.8   "Arbitrable Dispute" has the meaning set forth in Article 18.1.

     1.9   "Assignment  and  Bill of  Sale"  means a  document  in the  form of
Exhibit "H".

     1.10  "Business  Day"  means  a Day  (as  hereinafter  defined)  excluding
Saturdays, Sundays and U.S. legal holidays.

     1.11  "Buyer  Thrift and Stock  Purchase  Plans" has the meaning set forth
in Article 13.4. 

     1.12  "Buyer Group" has the meaning set forth in Article 8.2.

     1.13  "Buyer SEP Plan" has the meaning set forth in Article 13.3.

     1.14  "Casualty  Loss"  means any loss,  damage or  reduction  in value of
the  Properties  which  occurs  prior  to  Closing  resulting  from  mechanical
failure or defects,  catastrophic occurrences,  acts of God or any other losses
which  are not the  result  of  normal  wear and tear or of  natural  reservoir
changes.

     1.15  "Certificate" means a document in the form of Exhibit "K".

     1.16  "Claim" means any and all claims,  demands, suits, causes of action,
losses,   damages,   liabilities,   fines,   penalties  and  costs   (including
attorneys'  fees and costs of  litigation)  which have (or are alleged to have)
occurred  and  are  alleged  by  or  owed  to a  Third  Party  (as  hereinafter
defined).

     1.17  "Claimant" has the meaning set forth in Article 18.1.

     1.18  "Claim Notice" has the meaning set forth in Article 8.9.

     1.19  "Close" or  "Closing"  means the  consummation  of the  transfer  of
title  to  the  Properties  (as  hereinafter   defined)  to  Buyer,   including
execution and delivery of all documents provided for in this Agreement.

     1.20  "Closing Date" means December 15, 1997.

     1.21  "Computed  Interest"  means simple interest of ten percent (10%) per
annum using a three hundred sixty-five (365) Day year.

     1.22  "Confidentiality  Agreement"  has the  meaning  set forth in Article
17.5.

     1.23  "Day" means a calendar  day  consisting  of  twenty-four  (24) hours
from midnight to midnight.

     1.24  "Defensible  Title" means, as to the Properties,  such title held by
Seller  as  of  Closing  that,  except  for  the  Permitted   Encumbrances  (as
hereinafter defined):

           1.24.1  Entitles  Seller as of Closing to receive  not less than the
     "Net  Revenue  Interests"  set forth in  Exhibit  "A" of all oil,  gas and
     associated liquid and gaseous hydrocarbons and non-hydrocarbons  produced,
     saved and marketed from the Properties; and
 
           1.24.2  Obligates  Seller as of Closing  to bear costs and  expenses
     relating  to the  ownership,  operation,  maintenance  and  repair  of the
     Properties  in an amount not  greater  than the  "Working  Interests"  set
     forth in Exhibit "A", unless there is a corresponding  increase in the Net
     Revenue Interests.

     1.25  "Deposit" has the meaning set forth in Article 3.2.

     1.26  "Directly  Engaged  Employees"  has the meaning set forth in Article
13.1.

     1.27  "Effective  Time" means  December 1, 1997, at 7:00 a.m.,  local time
where the Properties are located.

     1.28  "Environmental  Claims"  means all Claims  which are based on breach
of Environmental Laws (as hereinafter defined).

     1.29  "Environmental  Laws"  means any and all Laws that  relate  to:  (a)
the prevention of pollution or  environmental  damage,  (b) the  remediation of
pollution  or   environmental   damage,   and/or  (c)  the  protection  of  the
environment  generally;  including  without  limitation,  the Clean Air Act, as
amended,  the Clean  Water Act,  as amended,  the  Comprehensive  Environmental
Response,  Compensation  and  Liability  Act of 1980,  as amended,  the Federal
Water  Pollution  Control  Act,  as  amended,  the  Resource  Conservation  and
Recovery  Act of 1976,  as amended,  the Safe  Drinking  Water Act, as amended,
the Toxic Substance and Control Act, as amended,  the Superfund  Amendments and
Reauthorization  Act of 1986,  as amended,  the  Hazardous  and the Solid Waste
Amendments  Act of 1984,  as amended,  and the Oil  Pollution  Act of 1990,  as
amended.

     1.30  "Final  Accounting  Settlement" has the meaning set forth in Article
6.5.

     1.31  "Final Settlement Date" has the meaning set forth in Article 6.5.

     1.32  "HSR Act" means the Hart-Scott-Rodino  Antitrust Improvements Act of
1976, as amended.

     1.33  "Laws" means laws, statutes,  ordinances,  permits, decrees, orders,
judgments,  rules or regulations  (including without  limitation  Environmental
Laws)  which are  promulgated,  issued or enacted by a  governmental  entity or
tribal authority having appropriate jurisdiction.

     1.34  "Letters-in-Lieu" means a document in the form of Exhibit "L".

     1.35  "License  Agreement  - SAMS" means a document in the form of Exhibit
"P",  and  "License  Agreement  - Seismic"  means the  document  referred to in
Article 12.4.

     1.36  "Mineral Deed" means a document in the form of Exhibit "J".

     1.37  "Non-Environmental  Claims" means all Claims,  except  Environmental
Claims.

     1.38  "Non-Foreign Affidavit" means a document in the form of Exhibit "N".

     1.39  "NORM" means naturally occurring radioactive materials.

     1.40  "Opinion of Counsel" means a document in the form of Exhibit "M".

     1.41  "Permitted Encumbrances"  means:

           1.41.1 Royalties,   overriding   royalties,   production   payments,
      reversionary  interests,  convertible  interests,  net profits interests,
      division  orders and similar  burdens  encumbering  the Properties to the
      extent the net  cumulative  effect of such burdens do not, as of Closing,
      operate to reduce the Net Revenue  Interests  of the  Properties  to less
      than the Net Revenue Interests set forth in Exhibit "A";

           1.41.2 Consents to  assignment  and similar  contractual  provisions
      encumbering  the  Properties  to  which,  prior to  Closing,  waivers  or
      consents are obtained from the appropriate parties;

           1.41.3 Preferential  rights to purchase  encumbering  any one (1) or
      more of the  Properties  to which,  prior to  Closing:  (a)  waivers  are
      obtained  from  the  appropriate  parties,  or (b) the  time  period  for
      exercising said right has elapsed.

           1.41.4 All rights to consent by,  required  notices to, filings with
      or  other  actions  by a  governmental  entity  or  tribal  authority  in
      connection  with the sale or  conveyance of the  Properties,  if the same
      are customarily obtained subsequent to the transfer of title;

           1.41.5 Rights  reserved  to or  vested in a  governmental  entity or
      tribal authority having  appropriate  jurisdiction to control or regulate
      the  Properties  in any  manner  whatsoever,  and all  Laws  of any  such
      governmental entity or tribal authority;

           1.41.6 Easements,   rights-of-way,   servitudes,   surface   leases,
      sub-surface  leases,  grazing rights,  logging rights,  canals,  ditches,
      reservoirs,  pipelines,  utility  lines,  telephone  lines,  power lines,
      railways,  streets,  roads,  highways and structures on, over and through
      the  Properties,  to the extent such rights,  interests or  structures do
      not materially interfere with the operation of the Properties;

           1.41.7 The terms and  conditions of all leases,  units,  agreements,
      contracts,   instruments,   licenses   and   permits   associated   with,
      attributable to or encumbering the Properties  which have been filed with
      the  appropriate  governmental  entity  or  tribal  authority,  placed of
      record in the  appropriate  County  records  or  otherwise  disclosed  by
      Seller to Buyer;

           1.41.8 Liens  for  taxes  or  assessments  not  yet  due or not  yet
      delinquent or, if delinquent,  that are being contested by Seller in good
      faith in the normal course of business;

           1.41.9 Liens of  operators  relating to  obligations  not yet due or
      not yet delinquent or, if delinquent,  that are being contested by Seller
      in good faith in the normal course of business;

           1.41.10 Alleged Title Defect(s)  which do not meet the individual or
      aggregate  threshold  amounts set forth in Article 1.4 or which Buyer has
      waived under Article 4.3;

           1.41.11 Alleged  Adverse   Condition(s)   which   do  not  meet  the
      individual  or  aggregate  threshold  amounts set forth in Article 1.3 or
      which Buyer has waived under Article 5.3;

           1.41.12 Gas imbalances associated with the Properties;

           1.41.13 Suspense funds associated with the Properties; and

           1.41.14 Such  defects  or   irregularities   in  the  title  to  the
      Properties that do not materially interfere with the operation,  value or
      use of the Properties  affected  thereby and that would be considered not
      material when applying general industry standards.

     1.42 "Personnel" has the meaning set forth in Article 13.1.

     1.43  "Process  Safety  Management"  has the  meaning set forth in Article
8.8.

     1.44 "Property" or "Properties" means Seller's ownership  interests in the
properties  (real,  personal or mixed) and appurtenant  rights  (contractual or
otherwise) as follows:

           1.44.1 All  of  Seller's  right,  title  and  interests  in,  to and
      under,  or derived  from,  the oil and gas leasehold  interests,  royalty
      interests,  overriding royalty interests,  mineral interests,  production
      payments,  net profits  interests,  surface  interests  and water  rights
      which are  attributable to the interests described in Exhibit "A";

           1.44.2 All  of  Seller's  right,  title  and  interests  in,  to and
      under,  or  derived  from,  all  of  the  presently  existing  and  valid
      unitization,   communization  and  pooling   declarations,   orders,  and
      agreements  (including all units formed by voluntary  agreement and those
      formed under the rules,  regulations,  orders or other  official  acts of
      any  governmental   entity  or  tribal   authority   having   appropriate
      jurisdiction)  to the extent  they relate to any of the  interests  which
      are  described  in Exhibit  "A", or the  production  of oil, gas or other
      hydrocarbon and non-hydrocarbon substances attributable thereto;

           1.44.3 All  of  Seller's  right,  title  and  interests  in,  to and
      under,  or derived  from,  all of the  presently  existing  and valid oil
      sales  contracts,  casinghead gas sales  contracts,  gas sales contracts,
      processing  contracts,  gathering  contracts,  transportation  contracts,
      easements, rights-of-way,  servitudes, surface leases, subsurface leases,
      permits,  licenses,  farm-out  contracts,  farm-in  contracts,  balancing
      contracts  (including but not limited to the gas imbalances  described in
      Exhibit  "D"),  suspense  funds,  operating  agreements,  areas of mutual
      interest, and other contracts,  agreements and instruments (including but
      not limited to the  material  contracts  described in Exhibit "C") to the
      extent  they  relate  to any of the  interests  which  are  described  in
      Exhibit  "A", or the  production  of oil,  gas or other  hydrocarbon  and
      non-hydrocarbon substances attributable thereto;

           1.44.4 All  of  Seller's  right,  title  and  interests  in,  to and
      under, or derived from, the personal  property,  improvements,  fixtures,
      wells  (whether  producing,  plugged and abandoned,  shut-in,  injection,
      disposal  or  water  supply),  tanks,  boilers,   buildings,   machinery,
      vehicles,  equipment,  pipelines,  utility lines, power lines,  telephone
      lines,  roads  and  other  appurtenances,  to the  extent  the  same  are
      situated  upon and used or held for use by Seller  solely  in  connection
      with the  ownership,  operation,  maintenance  or repair of the interests
      which are  described  in Exhibit  "A", or the  production  of oil, gas or
      other hydrocarbon and non-hydrocarbon substances attributable thereto;

           1.44.5 All  of  Seller's  right,  title  and  interests  in,  to and
      under, or derived from, the seismic,  geologic or geophysical information
      and data  (including  seismic  data  associated  with the Grass Creek and
      Pitchfork  properties)  to the  extent  the  same  relates  to any of the
      interests  which are described in Exhibit "A", or the  production of oil,
      gas or hydrocarbon and non-hydrocarbon  substances  attributable thereto;
      and

           1.44.6 All  of  Seller's  right,  title  and  interests  in,  to and
      under, or derived from, the partnerships (tax or otherwise)  described in
      Exhibit "E".

      SELLER  EXCEPTS,  RESERVES AND  RETAINS,  unto  itself,  its  Affiliates,
successors  and assigns from the  Properties  the following  properties  (real,
personal or mixed) and appurtenant rights (contractual or otherwise):

     (a)  Any and all seismic,  geologic or  geophysical  information  and data
that are: (i) prepared  internally by Seller and  interpretive in nature,  (ii)
covered an obligation of  non-disclosure  (provided  however,  Seller shall use
reasonable  efforts  to obtain  authority  to  disclose  said  information  and
data),  (iii) covered by an obligation of  confidentiality  (provided  however,
Seller  shall use  reasonable  efforts to obtain  authority  to  disclose  said
information  and  data),  (iv)  covered  by  a  prohibition   against  transfer
(provided  however,  Seller shall use reasonable efforts to obtain authority to
transfer  said  information  and  data),  (v)  covers  (in  whole  or in  part)
retained  assets  of  Seller  (provided  however,   Seller  shall  allow  Buyer
reasonable  access  to  said  information  and  data  in a form  redacting  the
information and data covering the retained assets);

     (b)  Any and all pipelines,  equipment,  facilities,  permits,  contracts,
agreements,  easements,  rights-of-way,  surface leases and  subsurface  leases
owned by an Affiliate of Seller,  including without limitation,  the properties
(real,  personal and mixed) and appurtenant  rights  (contractual or otherwise)
described in Exhibit "F",

     (c)  Any and all records  which  consist of previous  offers and  economic
analyses  associated  with the  purchase,  sale or exchange of the  Properties,
reserve data,  confidential  internal  communications,  personnel  information,
tax  information,  information  covered  by  a  non-disclosure  obligation  and
information covered by a legal privilege;

     (d)  The  properties  (real,  personal and mixed) and  appurtenant  rights
(contractual or otherwise) described in Exhibit "F-1";

     (e)  A  concurrent  interest  in,  to and  under,  or  derived  from,  the
contracts,   agreements,   instruments,   permits,  easements,   rights-of-way,
servitudes,   surface   leases,   subsurface   leases  and  any  other   rights
(contractual  or  otherwise)  to the extent  that they  relate to or affect the
interests not conveyed herein; and

     (f)  Any and all  RTU's,  except  Buyer  shall be  entitled  to fifty (50)
RTU's of its choice at the Salt Creek Unit.

     1.45 "Purchase Price" has the meaning set forth in Article 3.1.

     1.46 "Records" means all of Seller's  books,  records and files related to
the  Properties;  provided  however,  the term  Records  shall not include (and
Seller  shall  have no  obligation  to deliver  to Buyer)  previous  offers and
economic  analyses  associated  with  the  purchase,  sale or  exchange  of the
Properties,  reserve  data,  confidential  internal  communications,  personnel
information,   tax  information,   information   covered  by  a  non-disclosure
obligation and information covered by a legal privilege.

     1.47 "Respondent" has the meaning set forth in Article 18.1.

     1.48 "Seller Group"  has the meaning set forth in Article 8.2.

     1.49 "Sublease  Novation  Agreement"  means  a  document  in the  form  of
Exhibit "Q".

     1.50 "Surface Deed"  means a document in the form of Exhibit "I".

     1.51 "Third   Party"   means  any  person  or  entity,   governmental   or
otherwise, other than Seller and Buyer.

     1.52 "Title  Defect" means any lien,  encumbrance,  encroachment  or defect
associated   with  Seller's  title  to  the  Properties   (excluding   Permitted
Encumbrances)  that would cause Seller,  as of Closing,  not to have  Defensible
Title.

     1.53 "Transition Agreement" means a document in the form of Exhibit "O".

     1.54 "Transition Date" shall have the meaning set forth in Article 13.1.

     1.55 "WARN Obligations" has the meaning set forth in Article 13.9.

                         ARTICLE 2. SALE AND PURCHASE

     2.1  Sale  and  Purchase.  On  the  Closing  Date,  effective  as  of  the
Effective  Time and upon the terms and  conditions  herein  set  forth,  Seller
agrees to sell and assign the  Properties  to Buyer and Buyer agrees to buy and
accept the Properties.

          ARTICLE 3. PURCHASE PRICE, DEPOSIT AND PREFERENTIAL RIGHTS

     3.1  Purchase Price.  The total purchase price,  subject to adjustments as
set forth in this Agreement,  paid to Seller by Buyer for the Properties  shall
be Three  Hundred Two Million  Four  Hundred  Eighty-Five  Thousand  and No/100
United States Dollars (US  $302,485,000)  ("Purchase  Price"),  payable in full
at Closing in  immediately  available  funds.  If Closing  does not occur on or
before the later of: (a)  December  15,  1997,  or (b) three (3) Days after the
time period for  exercising  all  preferential  rights to purchase  encumbering
the  Properties  have  elapsed;  the  Purchase  Price shall be increased by the
Computed Interest from the Effective Time through Closing.

     3.2  Deposit.  Upon the  execution of this  Agreement,  Buyer shall pay to
Seller a deposit  in the amount of Twenty  Million  and  No/100  United  States
Dollars  ($20,000,000)  ("Deposit").  In the  event of  Closing,  the  Purchase
Price shall be credited by the amount of the Deposit  (plus  Computed  Interest
on the Deposit  from the date of receipt by Seller until  Closing).  If Closing
does not occur,  the Deposit  (plus  Computed  Interest on the Deposit from the
date of  receipt  by  Seller  until  termination)  will be  refunded  to Buyer,
unless  Closing  failed  to  occur  as a  result  of  Buyer's  breach  of  this
Agreement   (including  without  limitation  Buyer's  failure  to  comply  with
Article  14.1) in which case Seller  shall retain the Deposit plus all interest
thereon as liquidated damages and not as a penalty.

      3.3  Preferential  Rights To  Purchase.  Buyer's  good  faith  allocation
of the  Purchase  Price as set forth in Exhibit  "B" shall be used by Seller to
provide any required  preferential  purchase right notifications.  If, prior to
Closing,  a holder of a preferential  purchase  right  notifies  Seller that it
intends  to  exercise  its  rights  with  respect  to a  Property  to which its
preferential  purchase  right applies (as  determined  in  accordance  with the
agreement  in which the  preferential  purchase  right  arises),  the  Property
covered  by said  preferential  purchase  right  shall  be  excluded  from  the
Properties  to be conveyed to Buyer,  and the  Purchase  Price shall be reduced
by the value  allocated  to said  Property in Exhibit "B".  Buyer  acknowledges
and agrees that Seller  shall  determine  (in is sole  judgment)  the extent of
the  preferential   purchase  rights  encumbering  the  Properties,   and  said
determination  shall be used by Seller to  provide  the  preferential  purchase
right  notifications.  If the holder of the  preferential  purchase right fails
to  consummate  the  purchase  of the  Property  subject  to  the  preferential
purchase right,  Seller shall promptly  notify Buyer.  Within ten (10) Business
Days after  Buyer's  receipt of such  notice or  Closing,  whichever  is later,
Seller  shall  sell to Buyer,  and  Buyer  shall  purchase  from  Seller,  such
Property  under  the  terms of this  Agreement  for a price  equal to the value
allocated  to such  Property in Exhibit  "B".  Notwithstanding  the  foregoing,
Buyer shall have no  obligation  under this  Agreement or otherwise to purchase
the  Property  if Buyer is not  notified  of the  preferential  purchase  right
holder's  failure to  consummate  the  purchase of the Property  within  ninety
(90) Days following Closing.

                            ARTICLE 4. TITLE REVIEW

     4.1  Review  of Title  Records.  Upon  execution  of this  Agreement  (and
prior to  Closing),  Seller shall make  available  to Buyer  during  reasonable
business  hours  Records in  Seller's  possession  relating to the title to the
Properties.  Buyer  shall be  entitled  to review  said  title  Records.  Buyer
shall  have the right to  reasonably  request  copies of any and all such title
Records and upon such request,  Seller shall  provide the  requested  copies to
Buyer at Buyer's expense.

     4.2  Alleged Title Defects.  As soon as reasonably  practicable (and on an
ongoing  basis),  but in no event later than  ninety  (90) Days after  Closing,
Buyer  shall  notify  Seller of any  Properties  which are  subject  to Alleged
Title  Defect(s).  Buyer's  notice  asserting  Alleged  Title  Defect(s)  shall
include a description  and full  explanation  (including any and all supporting
documentation   associated  therewith)  of  each  Alleged  Title  Defect  being
claimed and a value which  Buyer in good faith  attributes  to curing the same.
Seller,  during said  ninety  (90) Day  period,  shall have the right to notify
Buyer  of any  increases  in Net  Revenue  Interest  or  decreases  in  Working
Interest in the  Properties  and  request a  corresponding  adjustment.  Seller
shall not be entitled to an  adjustment  associated  with any  increases in Net
Revenue   Interest  or  decreases  in  Working   Interest   unless  the  amount
associated with each such individual interest  adjustment exceeds  Seventy-Five
Thousand  and  No/100  United  States  Dollars  (US  $75,000)  net to  Seller's
interests  and  the  amount  associated  with  all  such  interest  adjustments
exceeds  three  percent  (3%)  of the  unadjusted  Purchase  Price.  Buyer  and
Seller  shall meet from time to time as  necessary  in an  attempt to  mutually
agree on a proposed  resolution  with  respect to the Alleged  Title  Defect(s)
raised by Buyer and  increases in Net Revenue  Interest or decreases in Working
Interest  raised by Seller.  The value  allocated to each Property as set forth
on Exhibit  "B" and the costs to cure such title  defects  shall be used by the
parties  to  determine  the  amount  of  any  adjustment,  if  any,  due to the
existence  of an  Alleged  Title  Defect.  It is  recognized  that  good  faith
differences  of opinion may exist between  Buyer and Seller in connection  with
the  Alleged  Title  Defect(s)  raised  by  Buyer  and  adjustments  to the Net
Revenue  Interests or Working  Interests  raised by Seller,  including  without
limitation,  disputes as to: (a) whether or not the alleged defect  constitutes
an Alleged  Title Defect within the meaning of this  Agreement,  (b) whether or
not the  magnitude  of the  alleged  defect  individually  or in the  aggregate
exceeds  the  threshold  amounts set forth in Article  1.4,  (c) whether or not
the Alleged  Title Defect  raised by Buyer was properly and timely  asserted by
Buyer pursuant to this Article,  and/or (d) the appropriate  upward or downward
adjustment,  if any,  on account  of a change in the Net  Revenue  Interest  or
Working   Interests   from  those  set  forth  in  Exhibit  "A".  If  any  such
differences  of  opinion  are not  resolved  by mutual  agreement  of Buyer and
Seller,  either  party  shall have the right,  exercisable  within one  hundred
eighty  (180)  Days  after  Closing,   to  initiate   binding   arbitration  in
accordance with Article 18.1,  using  arbitrators who are attorney(s)  licensed
in the state  where the  Property at issue is located and who have at least ten
(10) years oil and gas title experience.

     4.3  Waiver.  Except for  claims  Buyer  asserts  under  Seller's  special
warranty  of title  contained  Article  9.1,  all title  objections  (including
without  limitation  Alleged Title Defect(s)) not raised or referred to binding
arbitration,  as  applicable,  by Buyer  within  the time  period  provided  in
Article  4.2 shall be waived by Buyer for all  purposes,  and Buyer  shall have
no  right  to  seek an  adjustment  to the  Purchase  Price,  make a claim  (in
accordance with Article 18.1 or otherwise)  against Seller  associated with the
same,  and Buyer  (on  behalf  of  itself,  its  officers,  agents,  employees,
Affiliates, successors and assigns) irrevocably waives such claims.

                       ARTICLE 5. INSPECTION OF PREMISES

     5.1  Inspection  of  Premises.  Prior to Closing,  Buyer shall have access
during  reasonable  business  hours  to  the  Seller-operated  Properties,  and
Seller  shall use  reasonable  efforts to obtain  permission  for Buyer to gain
access to the Third  Party-operated  Properties,  for the purpose of inspecting
the  environmental  and physical  condition of the same. Such inspection  shall
be conducted in accordance with the terms of the Confidentiality Agreement.

     5.2  Alleged Adverse Conditions.  As soon as reasonably  practical (and on
an ongoing  basis),  but in no event later than two  hundred and seventy  (270)
Days after  Closing,  Buyer shall  notify  Seller of any  Properties  which are
subject to Alleged  Adverse  Condition(s).  Buyer's  notice of Alleged  Adverse
Condition(s)   shall  include  a  complete   description  of  each   individual
condition  to which Buyer takes  exception  (including  any and all  supporting
documentation  associated  therewith)  and the costs  which Buyer in good faith
attributes to  remediating  the same. In evaluating  the existence or magnitude
of an  Alleged  Adverse  Condition,  due  consideration  shall  be given to the
length  of time  the  Alleged  Adverse  Condition  has  been in  existence  and
whether such fact,  circumstance  or  condition  is of the type  expected to be
encountered in the area  involved,  and whether the Alleged  Adverse  Condition
is  customarily  acceptable  to reasonable  persons  engaged in the business of
ownership  and  operation  of oil and gas  properties.  Buyer and Seller  shall
meet  from time to time as  necessary  in an  attempt  to  mutually  agree on a
proposed  resolution  with respect to the Alleged Adverse  Condition(s)  raised
by Buyer.  The value  allocated  to each  Property  as set forth on Exhibit "B"
and the costs to cure such  adverse  condition  shall be used by the parties to
determine  the amount of any  adjustment,  if any,  due to the  existence of an
Alleged  Adverse  Condition.  It is recognized  that good faith  differences of
opinion  may exist  between  Buyer and Seller in  connection  with the  Alleged
Adverse  Condition(s) raised by Buyer,  including without limitation,  disputes
as to: (a) whether or not the alleged  defect  constitutes  an Alleged  Adverse
Condition  within  the  meaning  of  this  Agreement,  (b)  whether  or not the
magnitude of the alleged defect  individually  or in the aggregate  exceeds the
threshold  amounts  set forth in Article  1.3,  (c)  whether or not the Alleged
Adverse  Condition  raised by Buyer was properly  and timely  asserted by Buyer
pursuant  to this  Article,  and/or (d) the  adjustment,  if any, on account of
the Alleged  Adverse  Condition.  If any such  difference of opinion  regarding
an  Alleged  Adverse  Condition  raised  by Buyer  is not  resolved  by  mutual
agreement of Buyer and Seller,  either party shall have the right,  exercisable
within three hundred sixty five (365) Days after Closing,  to initiate  binding
arbitration  in  accordance   with  Article  18.1.   Notwithstanding   anything
contained in this  Agreement  to the  contrary  (including  Article  18.1),  if
Seller  disagrees  with the  decision of the  arbitration  panel,  Seller shall
have the right (but not the  obligation)  to: (i)  remediate,  at Seller's sole
cost,  the  Property  at issue to a point  where it is in  compliance  with the
Laws, or (ii) require the  reassignment  of the Property at issue from Buyer to
Seller.  If Seller  elects to  require  the  reassignment  of the  Property  at
issue,  Buyer and Seller  will take all  necessary  action  (including  without
limitation,  execution of documentation and conducting an accounting)  required
to place the  parties  back into a position  with  respect to the  Property  at
issue just prior to  Closing.

     5.3  Waiver.   All  adverse   conditions   (including  without  limitation
Alleged Adverse  Condition(s))  not raised or referred to binding  arbitration,
as  applicable,  by Buyer within the time period  provided in Article 5.2 shall
be waived by Buyer for all  purposes,  and Buyer shall have no right to seek an
adjustment  to the Purchase  Price,  make a claim (in  accordance  with Article
18.1 or  otherwise)  against  Seller  associated  with the same,  and Buyer (on
behalf of itself, its officers, agents, employees,  Affiliates,  successors and
assigns) irrevocably waives such claims.

                             ARTICLE 6. ACCOUNTING

     6.1  Revenues,  Expenses and Capital  Expenditures.  All merchantable oil,
liquid hydrocarbon and  non-hydrocarbon  substances stored in tanks and vessels
on the  Properties  (including  any and all line  fill  owned by  Seller or its
Affiliates  downstream  of the  custody  transfer  point) will be gauged to the
bottom  of  the  flange  by  Seller  or the  operator  of  the  Properties,  as
applicable,  as of the  Effective  Time,  and Seller  shall be  entitled to the
proceeds  associated  with such oil,  liquid  hydrocarbon  and  non-hydrocarbon
substances so gauged when sold.  Oil, liquid  hydrocarbon  and  non-hydrocarbon
substances  in treating  equipment  and  separation  equipment  below  pipeline
connections   as  of  the  Effective   Time  shall  not  be  considered  to  be
merchantable  and shall become the property of Buyer.  Seller shall be entitled
to all  operating  revenues  and  related  accounts  receivable  arising in the
ordinary  course  of  business  attributable  to the  Properties  and  shall be
responsible  for all operating  expenses and related  accounts  payable (except
as provided below) arising in the ordinary  course of business  attributable to
the  Properties,  in each case to the extent  they relate to the period of time
prior  to the  Effective  Time.  Buyer  shall  be  entitled  to  all  operating
revenues and related  accounts  receivable  arising in the  ordinary  course of
business  attributable  to the  Properties and  responsible  for the payment of
all operating  expenses and related  accounts  payable  arising in the ordinary
course of business  attributable to the Properties,  in each case to the extent
they  relate to the period of time after the  Effective  Time.  Notwithstanding
anything  contained in this  Agreement to the contrary,  Seller shall  transfer
to Buyer and Buyer  shall  assume and be solely  responsible  for:  (a) any and
all suspense  funds  associated  with the  Properties,  and (b) any and all gas
imbalances  associated  with the  Properties.  The  actual  amounts  or  values
associated  with the  above  shall be  accounted  for in the  Final  Accounting
Settlement.

     6.2  Taxes.  All  taxes and  assessments,  including  without  limitation,
excise taxes,  ad valorem taxes and any other federal,  state,  local or tribal
taxes  or  assessments  attributable  to  the  ownership  or  operation  of the
Properties  prior to the Effective  Time shall remain  Seller's  responsibility
(no  matter  when due or  payable),  and all  deductions,  credits  or  refunds
pertaining  to  the  aforementioned  taxes  and  assessments,  no  matter  when
received,  shall  belong  to  Seller.  All  taxes  and  assessments,  including
without  limitation,  excise  taxes,  ad valorem  taxes and any other  federal,
state,  local or tribal taxes and assessments  attributable to the ownership or
operation  of the  Properties  after the  Effective  Time  (excluding  Seller's
income  taxes  from the  Effective  Time  through  Closing  and any  associated
capital gains taxes which shall remain  Seller's  obligation)  shall be Buyer's
responsibility,  and all  deductions,  credits  or  refunds  pertaining  to the
aforementioned  taxes and  assessments,  no matter when received,  shall belong
to Buyer.  The actual  amounts or values  associated  with the above,  shall be
accounted  for in the Final  Accounting  Settlement.  Buyer shall  additionally
be solely  responsible for all transfer,  sales, use or similar taxes resulting
from or associated with the transaction contemplated under this Agreement.

     6.3  Obligations  and Credits.  All prepaid  insurance  premiums,  utility
charges,  taxes,  rentals,  deposits and any other  prepaids  applicable to the
period of time  after the  Effective  Time,  if any,  and  attributable  to the
Properties  shall be  reimbursed to Seller by Buyer,  and all accrued  payables
applicable  to the  period of time prior to the  Effective  Time,  if any,  and
attributable  to the  Properties  shall be the  responsibility  of Seller.  The
actual  amounts or values  associated  with the above shall be accounted for in
the Final Accounting Settlement.

     6.4  Miscellaneous  Accounting.  In  addition  to the  items  set forth in
Articles  6.1 through  6.3,  any other  amounts  due  between  Buyer and Seller
related to the  ownership  or operation of the  Properties  from the  Effective
Time  through   Closing  shall  be  accounted  for  in  the  Final   Accounting
Settlement.

     6.5  Final Accounting Settlement.  As soon as reasonably practicable,  but
in no event  later  than one  hundred  and eighty  (180)  Days  after  Closing,
Seller  shall  deliver  to  Buyer  a  post-Closing  statement  setting  forth a
detailed calculation of all post-Closing  adjustments  applicable to the period
of  time   between  the   Effective   Time  and  Closing   ("Final   Accounting
Settlement").  As soon as  reasonably  practicable,  but in no event later than
forty-five  (45) Days after Buyer receives the  post-Closing  statement,  Buyer
shall  deliver to Seller a written  report  containing  any changes which Buyer
proposes to be made to such  post-Closing  statement.  If Buyer fails to timely
deliver the written  report to Seller  containing  changes Buyer proposes to be
made to the post-Closing  statement,  the post-Closing  statement  delivered by
Seller  shall be deemed to be true and  correct and the same shall be final and
binding on the  parties and not subject to  arbitration  hereunder.  As soon as
reasonably  practicable,  but in no event  later than  fifteen  (15) Days after
Seller receives  Buyer's  written report,  the parties shall meet and undertake
to agree on the final  post-Closing  adjustments.  If the parties fail to agree
on the final  post-Closing  adjustments  within such  fifteen  (15) Day period,
the  disputed  items  shall be  resolved  by  submitting  the same to Ernst and
Young (the  "Accounting  Referee").  The  Accounting  Referee shall resolve the
dispute(s)  regarding  the  post-Closing  adjustments  within  thirty (30) Days
after  having the  relevant  materials  submitted  for review.  The decision of
the  Accounting   Referee  shall  be  binding  on  and  non-appealable  by  the
parties.  The fees and expenses  associated  with the Accounting  Referee shall
be  borne  equally  by Buyer  and  Seller.  The date  upon  which  all  amounts
associated with the Final  Accounting  Settlement are agreed to by the parties,
whether by decision of the  Accounting  Referee or  otherwise,  shall be herein
called the "Final  Settlement  Date".  Any amounts  owed by either party to the
other as a result of such  post-Closing  adjustments  shall be paid within five
(5) Business Days after the Final Settlement Date.

     6.6  Post-Final  Accounting  Settlement.  Any  revenues  received or costs
and  expenses  paid by Buyer after the Final  Accounting  Settlement  which are
attributable  to the  ownership  or operation  of the  Properties  prior to the
Effective  Time, and not assigned to Buyer,  shall be billed or reimbursed,  as
appropriate,  to Seller  within  thirty (30) Days after  receipt by Buyer.  Any
revenues  received  or costs  and  expenses  paid by  Seller  after  the  Final
Accounting  Settlement  which are attributable to the ownership or operation of
the Properties  after the Effective Time, and not reserved by Seller,  shall be
billed or reimbursed,  as  appropriate,  to Buyer within thirty (30) Days after
receipt by Seller.

                  ARTICLE 7. LOSS, CASUALTY AND CONDEMNATION

     7.1  Notice of Loss.  From the date hereof  until  Closing,  Seller  shall
promptly  notify  Buyer of any loss or  damage to the  Properties,  or any part
thereof,  known to Seller  exceeding  One Hundred  Thousand  and No/100  United
States Dollars (US $100,000) net to Seller's interest.

     7.2  Casualty and Condemnation.  If, prior to Closing,  a substantial part
of the  Properties  shall:  (a) be  destroyed  by a  Casualty  Loss,  or (b) be
taken in  condemnation  or if  proceedings  for such purposes shall be pending;
then Seller and Buyer shall  attempt to  mutually  agree on a reduction  in the
Purchase  Price  reflecting  the  reduction  in the  value  of  the  Properties
affected  by the  Casualty  Loss or  taking.  If Seller and Buyer are unable to
mutually  agree  on  such  reduction,   either  party  shall  have  the  right,
exercisable  within  ninety  (90)  Days  after  Closing,  to  initiate  binding
arbitration  in  accordance  with  Article  18.1.  Seller  shall retain any and
all sums paid to Seller from Third Parties,  unpaid awards,  insurance proceeds
or other  payments  associated  with or  attributable  to such Casualty Loss or
taking.

           ARTICLE 8. ALLOCATION OF RESPONSIBILITIES AND INDEMNITIES

     8.1  Opportunity  for  Review.  Each party  represents  that it has had an
adequate   opportunity   to  review  the   following   indemnity   and  release
provisions,  including the  opportunity to submit the same to legal counsel for
review  and  comment.  Based upon the  foregoing  representation,  the  parties
agree to the provisions set forth below.

     8.2  Seller's  Non-Environmental   Indemnity  Obligation.   Seller  shall,
subject  to the  limitations  set forth  below,  release  Buyer  from and shall
fully  protect,  indemnify and defend Buyer,  its officers,  agents,  employees
and  Affiliates  (collectively  "Buyer  Group") and hold them harmless from and
against any and all  Non-Environmental  Claims, and any and all occurrences and
conditions  which  would  otherwise  constitute  Non-Environmental  Claims  but
which are asserted by Seller,  its officers,  agents,  employees and Affiliates
(collectively  "Seller  Group"),  relating  to,  arising  out of, or  connected
with,  directly or  indirectly,  the ownership or operation of the  Properties,
or any part  thereof,  during the period of time  prior to  Closing,  including
without limitation,  Non-Environmental  Claims relating to: (a) injury or death
of any person or persons  whomsoever,  (b)  damages to or loss of any  property
or  resources,  (c)  common  law  causes of action  such as  negligence,  gross
negligence,  strict liability,  nuisance or trespass,  and/or (d) fault imposed
by statute,  rule,  regulation  or  otherwise.  The  indemnity  obligation  and
release  provided  herein shall apply  regardless  of cause or of any negligent
acts or  omissions  (excluding  gross  negligence  and willful  misconduct)  of
Buyer  Group.  Notwithstanding  anything  contained  in this  Agreement  to the
contrary,  Seller shall have no  obligation  under this  Agreement or otherwise
to protect,  indemnify,  defend and hold harmless  Buyer Group from and against
any  one or more of the  following:  (i)  Non-Environmental  Claims  for  which
Buyer has not  provided  Seller with written  notice of such  Non-Environmental
Claim in  accordance  with  Article  8.9  within  eighteen  (18)  months  after
Closing  (it  being   acknowledged  and  agreed  that  Buyer  shall  be  solely
responsible  for any and all  Non-Environmental  Claims not raised  within such
eighteen month  period),  or (ii)  Non-Environmental  Claims in aggregate up to
three  percent (3%) of the  unadjusted  Purchase  Price (it being  acknowledged
and  agreed   that  Buyer  shall  be  solely   responsible   for  any  and  all
Non-Environmental  Claims up to three percent (3%) of the  unadjusted  Purchase
Price).

     8.3  Seller's  Environmental  Indemnity Obligation.  Seller shall, subject
to the  limitations  set  forth  below,  release  Buyer  from and  shall  fully
protect,  indemnify  and defend  Buyer  Group and hold them  harmless  from and
against  any and all  Environmental  Claims,  and any and all  occurrences  and
conditions  which would  otherwise  constitute  Environmental  Claims but which
are asserted by Seller Group,  relating to, arising out of, or connected  with,
directly or indirectly,  the ownership or operation of the  Properties,  or any
part  thereof,  during the period of time prior to Closing,  including  without
limitation,  Environmental  Claims  relating  to:  (a)  injury  or death of any
person  or  persons  whomsoever,  (b)  damages  to or loss of any  property  or
resources,  (c) pollution,  environmental  damage or violation of Environmental
Laws,  (d) common law causes of action such as  negligence,  gross  negligence,
strict  liability,  nuisance or trespass,  and/or (e) fault imposed by statute,
rule,  regulation or otherwise.  The indemnity  obligation and release provided
herein shall apply  regardless of cause or of any  negligent  acts or omissions
(excluding   gross   negligence   and  willful   misconduct)  of  Buyer  Group.
Notwithstanding  anything  contained in this Agreement to the contrary,  Seller
shall  have no  obligation  under  this  Agreement  or  otherwise  to  protect,
indemnify,  defend and hold  harmless  Buyer  Group from and against any one or
more of the  following:  (i)  Environmental  Claims  for  which  Buyer  has not
provided Seller with written notice of said  Environmental  Claim in accordance
with  Article  8.9  within   twelve  (12)  months   after   Closing  (it  being
acknowledged  and agreed  that Buyer  shall be solely  responsible  for any and
all  Environmental  Claims not raised  within such twelve month  period),  (ii)
Environmental  Claims in aggregate up to three  percent (3%) of the  unadjusted
Purchase  Price (it being  acknowledged  and agreed  that Buyer shall be solely
responsible  for any and all  Environmental  Claims up to three percent (3%) of
the unadjusted  Purchase  Price),  or (iii)  Environmental  Claims greater than
fifty percent (50%) of the  unadjusted  Purchase  Price (it being  acknowledged
and  agreed   that  Buyer  shall  be  solely   responsible   for  any  and  all
Environmental  Claims  greater  than  fifty  (50%)  percent  of the  unadjusted
Purchase Price).

     8.4  Buyer's Non-Environmental  Indemnity Obligation.  Buyer shall release
Seller from and shall fully  protect,  indemnify  and defend  Seller  Group and
hold them harmless from and against any and all  Non-Environmental  Claims, and
any and  all  occurrences  and  conditions  which  would  otherwise  constitute
Non-Environmental  Claims but which are asserted by Buyer  Group,  relating to,
arising out of, or connected  with,  directly or  indirectly,  the ownership or
operation of the  Properties,  or any part  thereof,  during the period of time
prior to  Closing,  no  matter  when  asserted,  for which  Seller's  indemnity
obligation  has  ceased,   terminated  (in  accordance   with  Article  8.2  or
otherwise)   or  did  not   exist,   and   from   and   against   any  and  all
Non-Environmental  Claims  relating  to,  arising  out of, or  connected  with,
directly or indirectly,  the ownership or operation of the  Properties,  or any
part thereof,  during the period of time at and after  Closing,  no matter when
asserted;  including without limitation,  Non-Environmental Claims relating to:
(a)  injury or death of any  person or persons  whomsoever,  (b)  damages to or
loss of any  property  or  resources,  (c) common law causes of action  such as
negligence,  gross negligence,  strict liability,  nuisance or trespass, and/or
(d) fault imposed by statute,  rule,  regulation  or  otherwise.  The indemnity
obligation and release  provided  herein shall apply  regardless of cause or of
any  negligent  acts or  omissions  (excluding  gross  negligence  and  willful
misconduct) of Seller Group.

     8.5  Buyer's  Environmental  Indemnity  Obligation.  Buyer  shall  release
Seller from and shall fully  protect,  indemnify  and defend  Seller  Group and
hold them harmless from and against any and all Environmental  Claims,  and any
and  all   occurrences  and  conditions   which  would   otherwise   constitute
Environmental  Claims  but which are  asserted  by Buyer  Group,  relating  to,
arising out of, or connected  with,  directly or  indirectly,  the ownership or
operation of the  Properties,  or any part  thereof,  during the period of time
prior to  Closing,  no  matter  when  asserted,  for which  Seller's  indemnity
obligation  has  ceased,   terminated  (in  accordance   with  Article  8.3  or
otherwise)  or did not exist,  and from and against  any and all  Environmental
Claims   relating  to,  arising  out  of,  or  connected   with,   directly  or
indirectly,  the  ownership  or  operation  of  the  Properties,  or  any  part
thereof,  during  the  period of time at and  after  Closing,  no  matter  when
asserted;  including  without  limitation,  Environmental  Claims  relating to:
(a)  injury or death of any  person or  persons  whomsoever,  (b)  damage to or
loss of any  property  or  resource,  (c)  pollution,  environmental  damage or
violation  of  Environmental  Laws,  (d) common  law  causes of action  such as
negligence,  gross negligence,  strict liability,  nuisance or trespass, and/or
(e) fault imposed by statute,  rule,  regulation  or  otherwise.  The indemnity
obligation and release  provided  herein shall apply  regardless of cause or of
any  negligent  acts or  omissions  (excluding  gross  negligence  and  willful
misconduct) of Seller Group.

     8.6  Asbestos  and  NORM.  Buyer  acknowledges  that  the  Properties  may
currently  or have in the past  contained  asbestos  or NORM  and that  special
procedures  may  be  required  for  the   assessment,   remediation,   removal,
transportation   or  disposal  of  such  asbestos  and  NORM.   Notwithstanding
anything  contained  in  this  Agreement  to the  contrary  (including  without
limitation   Articles   5.2,   8.2  or  8.3),   Buyer  agrees  to  accept  full
responsibility  for and shall pay all costs and  expenses  associated  with the
assessment,  remediation,  removal, transportation and disposal of the asbestos
or NORM  associated  with the  Properties,  and shall not be  entitled to claim
the fact the assessment,  remediation,  removal,  transportation or disposal of
the asbestos or NORM is not complete or that  additional  cost will be required
to complete the assessment,  remediation,  removal,  transportation or disposal
of  the  asbestos  or  NORM  as  an  Alleged  Title  Defect,   Alleged  Adverse
Condition,  breach of  Seller's  representations  and  warranties  or breach of
Seller's  indemnity  obligation  under this Agreement,  and Buyer (on behalf of
itself, its officers,  agents, employees,  Affiliates,  successors and assigns)
irrevocably  waives  such  claims.  In  conducting  the duties and  obligations
contained in this Article, Buyer shall comply with the applicable Laws.

     8.7  Buyer's  Assumption of Obligations.  Buyer agrees to assume and shall
timely perform and discharge all duties and  obligations  of Seller  associated
with   the   Properties   (including   without   limitation   any   contractual
obligations)  relating to the period of time at and after  Closing,  and Seller
shall incur no liability for Buyer's  failure to properly  perform or discharge
any such duties and  obligations.  Notwithstanding  anything  contained in this
Agreement to the contrary  (including without  limitation  Articles 5.2, 8.2 or
8.3),  Buyer agrees to accept full  responsibility  for and shall pay all costs
and expenses  associated  with the plugging  and  abandonment  of the wells and
facilities  included in the Properties,  and shall not be entitled to claim the
fact  that  plugging  and  abandonment  operations  are  not  complete  or that
additional  cost will be required  to complete  the  plugging  and  abandonment
operations as an Alleged Title Defect,  Alleged  Adverse  Condition,  breach of
Seller's  representations  and  warranties  or  breach  of  Seller's  indemnity
obligation  under  this  Agreement,   and  Buyer  (on  behalf  of  itself,  its
officers,  agents, employees,  Affiliates,  successors and assigns) irrevocably
waives such  claims.  In  conducting  the duties and  obligations  contained in
this Article, Buyer shall comply with the applicable Laws.

     8.8  Process Safety  Management.  Buyer  acknowledges  that Process Safety
Management  of Highly  Hazardous  Chemicals;  Explosives  and  Blasting  Agents
(i.e.,  29 CFR 1910)  (collectively  "Process  Safety  Management")  associated
with  the   Properties  is  an  ongoing   process.   Notwithstanding   anything
contained  in this  Agreement  to the contrary  (including  without  limitation
Articles 5.2, 8.2 or 8.3), Buyer agrees to accept full  responsibility  for and
shall  pay  all  costs  and  expenses   associated   with  the  Process  Safety
Management   process   (including   without   limitation  the   identification,
evaluation and  remediation),  and shall not be entitled to claim the fact that
Process  Safety  Management  is not  complete or that  additional  cost will be
required to comply with or complete the Process  Safety  Management  process as
an  Alleged  Title  Defect,  Alleged  Adverse  Condition,  breach  of  Seller's
representations  and  warranties  or breach of  Seller's  indemnity  obligation
under this  Agreement,  and Buyer (on behalf of itself,  its officers,  agents,
employees,   Affiliates,   successors  and  assigns)  irrevocably  waives  such
claims.  In conducting  the duties and  obligations  contained in this Article,
Buyer shall comply with the applicable Laws.

     8.9  Notice of Claims.  If a Claim is  asserted  against a party for which
the other party may have an obligation  of  indemnity,  it shall be a condition
precedent to the  indemnifying  party's  obligations  under this Article 8 that
the  indemnified  party  give the  indemnifying  party  written  notice of such
Claim  setting forth the  particulars  associated  with the Claim  (including a
copy of the  written  Claim,  if any) as then known by the  indemnified  party.
The   indemnified   party  shall  make  a  good  faith  effort  to  notify  the
indemnifying  party  within  one (1) month of  receipt  of a Claim and shall in
all  events  effect  notice  within  such time as will  allow the  indemnifying
party a reasonable  period of time in which to evaluate  and timely  respond to
said  Claim.  The  notice  of Claim  provided  hereunder  is  referred  to as a
"Claim Notice."

     8.10   Defense  of  Claims.   Upon   receipt  of  a  Claim   Notice,   the
indemnifying  party may assume the defense of said Claim with counsel  selected
by the  indemnifying  party  and  reasonably  satisfactory  to the  indemnified
party.  The  indemnified  party shall  cooperate in all reasonable  respects in
such defense.  If any Claim  involves a fact pattern  wherein Buyer may have an
obligation  to indemnify  Seller and Seller may have an obligation to indemnify
Buyer,  each  party  shall  have the right to assume  the  defense  of and hire
counsel for that  portion of the Claim for which it may have an  obligation  of
indemnity.  In all  instances,  the  indemnified  party shall have the right to
employ  separate  counsel  and to  participate  in the  defense  of any  Claim;
provided   however,   the  fees  and  expenses  of  counsel   employed  by  the
indemnified  party  shall be borne  solely  by the  indemnified  party.  If the
indemnifying  party does not notify the  indemnified  party  within the earlier
to  occur  of:  (a)  five (5) Days  before  the time a  response  is due in any
litigation  matter,  or (b) sixty (60) Days after  receipt of the Claim Notice,
that the  indemnifying  party elects to undertake  the defense of a Claim,  the
indemnified  party  shall  have the  right to  defend,  at the  expense  of the
indemnifying   party,  the  Claim  with  counsel  of  the  indemnified  party's
choosing,  subject  to the  right  of the  indemnifying  party  to  assume  the
defense of the Claim at any time  prior to  settlement  or final  determination
thereof.  In such event,  the  indemnified  party shall promptly send a written
notice to the indemnifying  party of any proposed  settlement of a Claim, which
settlement  the  indemnifying  party may  accept or reject,  in its  reasonable
judgment,  within  thirty  (30) days of  receipt  of such  notice,  unless  the
settlement  offer is  limited  to a shorter  period  of time in which  case the
indemnifying  party shall have such  shorter  period of time in which to accept
or  reject  the  proposed  settlement.  Failure  of the  indemnifying  party to
accept or reject such  settlement  within the  applicable  period of time shall
be  deemed  to  be  its  rejection  of  such  settlement.  Notwithstanding  the
foregoing,  the  indemnified  party may settle any matter over the objection of
the indemnifying  party, but in so doing the indemnified  party shall be deemed
to  have  waived  any  right  to  indemnity  therefor  as to  (and  only as to)
liabilities  with respect to which the  indemnifying  party has acknowledged in
writing its indemnity obligation.

     8.11  Waiver of Certain  Damages.  Each of the parties  hereby  waives and
agrees not to seek indirect,  consequential,  punitive or exemplary  damages of
any kind with  respect to any Claim or dispute  arising  out of or  relating to
this  Agreement or breach hereof.  This provision  shall not diminish or affect
in any way the parties' rights and obligations  under any indemnities  provided
for in this Agreement.

     8.12 Limitation on Indemnities.  In no event shall an  indemnifying  party
have any obligation of  indemnification  to the indemnified party, if the Claim
for which  indemnity is sought was caused by a criminal  act,  fraudulent  act,
gross  negligence  or  willful  misconduct  of  the  indemnified  party  or its
officers,  directors,  employees,  agents, Affiliates,  successors and assigns,
nor shall any indemnity  provisions in this Agreement  apply to or be deemed to
apply  to  matters  affecting   properties   (real,   personal  or  mixed)  and
appurtenant  rights  (contractual  or  otherwise)  other than  those  which are
covered by this Agreement.

                  ARTICLE 9. SPECIAL WARRANTY AND DISCLAIMERS

     9.1  Special  Warranty  of  Title.  Seller  shall  warrant  title  to  and
forever defend title to the  Properties  conveyed to Buyer against every person
whomsoever  lawfully  claiming  title to the  Properties,  or any part  thereof
by,  through or under Seller, but not otherwise.

     9.2  Disclaimer - Representations  and Warranties.  Buyer acknowledges and
agrees that the  Properties are being  transferred,  assigned and conveyed from
Seller  to  Buyer  "AS-IS,  WHERE-IS",  and with all  faults  in their  present
condition  and state of  repair,  without  recourse.  Except as  expressly  set
forth  in this  Article  10,  Seller  hereby  expressly  disclaims  any and all
representations and warranties concerning the Properties,  express,  statutory,
implied or otherwise,  including without limitation:  (a) any warranty of title
(except for the special  warranty of title set forth in Article  9.1),  (b) the
existence  of  any  and  all  prospects,   (c)  the  geographic,   geologic  or
geophysical  characteristics  associated  with any and all  prospects,  (d) the
existence,   quality,   quantity  or  recoverability  of  hydrocarbon  reserves
associated with the Properties,  (e) the costs, expenses,  revenues or receipts
associated  with the  Properties,  (f) the  contractual,  economic or financial
data associated with the Properties,  (g) the continued  financial viability or
productivity of the Properties,  (h) the  environmental  or physical  condition
of the  Properties,  (i) the federal,  state,  local or tribal  income or other
tax  consequences  associated with the  Properties,  or the agreements to which
the Properties are subject,  (j) the absence of patent or latent  defects,  (k)
safety,  (l)  state of  repair,  (m)  merchantability,  and (n)  fitness  for a
particular  purpose;  and Buyer (on behalf of  itself,  its  officers,  agents,
employees, Affiliates, successors and assigns) irrevocably waives such claims.

     9.3  Disclaimer - Statements and Information.  Seller expressly  disclaims
any  and  all  liability  and   responsibility  for  and  associated  with  the
quality,  accuracy,  completeness  or materiality of the data,  information and
materials  furnished  (electronically,  orally,  by video,  in  writing  or any
other  medium)  at any  time to  Buyer,  its  officers,  agents,  employees  or
Affiliates in connection with the transaction  contemplated  herein,  including
without  limitation:  (a)  the  existence  of any and  all  prospects,  (b) the
geographic,  geologic or geophysical  characteristics  associated  with any and
all  prospects,  (c) the  existence,  quality,  quantity or  recoverability  of
hydrocarbon reserves associated with the Properties,  (d) the costs,  expenses,
revenues or  receipts  associated  with the  Properties,  (e) the  contractual,
economic or financial data associated  with the  Properties,  (f) the continued
financial  viability or productivity of the Properties,  (g) the  environmental
or physical condition of the Properties,  and (h) the federal,  state, local or
tribal income or other tax  consequences  associated  with the  Properties,  or
the  agreements to which the  Properties  are subject;  and Buyer (on behalf of
itself, its officers,  agents, employees,  Affiliates,  successors and assigns)
irrevocably waives such claims.

              ARTICLE 10. SELLER'S REPRESENTATIONS AND WARRANTIES

     Seller  represents and warrants to Buyer that on the date hereof and as of
Closing:

     10.1 Organization  and  Good  Standing.   Seller  is  a  corporation  duly
organized,  validly  existing and in good standing  under the Laws of the State
of Delaware,  and has all  requisite  corporate  power and authority to own and
lease the  Properties.  Seller is duly  licensed or qualified to do business as
a foreign  corporation  and is in good standing in all  jurisdictions  in which
the Properties are located.

     10.2 Corporate  Authority;  Authorization  of  Agreement.  Seller  has all
requisite   corporate   power  and   authority  to  execute  and  deliver  this
Agreement,  to consummate the transactions  contemplated  herein and to perform
all of the terms and  conditions  to be performed by it as provided for in this
Agreement.  The  execution  and  delivery  of this  Agreement  by  Seller,  the
performance  by Seller of all of the terms and  conditions  to be  performed by
it and the  consummation  of the  transactions  contemplated  herein  have been
duly  authorized  and  approved  by  all  necessary   corporate  action.   This
Agreement has been duly executed and  delivered by Seller and  constitutes  the
valid and binding  obligation of Seller,  enforceable  against it in accordance
with its terms,  except as such  enforceability  may be limited by  bankruptcy,
insolvency  or  other  Laws  relating  to  or  affecting  the   enforcement  of
creditors' rights and general  principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).

     10.3 No Violations.  Assuming  expiration or termination of the applicable
waiting  period under the HSR Act, if  applicable,  the  execution and delivery
of this Agreement by Seller does not, and the  fulfillment  and compliance with
the  terms and  conditions  hereof  and the  consummation  of the  transactions
contemplated herein, will not:

          10.3.1 Conflict  with or require  the consent of any person or entity
     under any of the terms,  conditions or provisions  of the  certificate  of
     incorporation or bylaws of Seller;

          10.3.2 Violate any  provision  of, or require any filing,  consent or
     approval  under any Law  applicable  to or binding  upon Seller  (assuming
     receipt of all consents and approvals of  governmental  entities or tribal
     authorities customarily obtained subsequent to the transfers of title);

          10.3.3 Conflict  with,  result in a breach of,  constitute  a default
     under or  constitute  an event that with notice or lapse of time, or both,
     would  constitute a default under,  accelerate or permit the  acceleration
     of the performance  required by, or require any consent,  authorization or
     approval under:  (i) any mortgage,  indenture,  loan,  credit agreement or
     other  agreement,  evidencing  indebtedness  for  borrowed  money to which
     Seller  is a party  or by  which  Seller  is  bound,  or (ii)  any  order,
     judgment or decree of any governmental entity or tribal authority; or

          10.3.4 Result  in  the  creation  or   imposition   of  any  lien  or
     encumbrance upon the Properties.

     10.4 Absence of Certain  Changes.  Between the date of  execution  of this
Agreement  and  Closing,  there  has not been  without  Buyer's  prior  written
consent:

          10.4.1 A  waiver  of any  right of  material  value  relating  to the
     Properties, other than in the ordinary course of business;

          10.4.2 A sale,  lease or other  disposition of the Properties,  other
     than in the ordinary course of business;

          10.4.3 A mortgage,  pledge or grant of a lien or security interest in
     any of the Properties;

          10.4.4 A  contract  for  the  sale  of  products,  other  than in the
     ordinary course of business  (provided  however,  Buyer  acknowledges  and
     agrees that Seller may enter into short term marketing  arrangements  that
     are consistent with Seller's past marketing practices);

          10.4.5 A contract  between  Seller and any of its  Affiliates,  other
     than  in  the  ordinary  course  of  business  (provided  however,   Buyer
     acknowledges  and agrees that  Seller may enter into short term  marketing
     arrangements that are consistent with Seller's past marketing  practices);
     or

          10.4.6 A contract or commitment to do any of the foregoing.

      10.5  Operating   Costs.  All  costs  incurred  in  connection  with  the
operation  of the  Properties  have been fully paid and  discharged  by Seller,
except  normal  expenses  incurred  in  operating  the  Properties  within  the
previous sixty (60) Days or as to which Seller has not yet been billed.

     10.6  Litigation.  Except as set forth in Exhibit "G" or  disclosed  prior
to  Closing,  there is no action,  suit or  proceeding  pending  or  threatened
against  Seller  which  would  have a material  adverse  effect on the value or
operation  of the  Properties  or that would  prevent the  consummation  of the
transaction    contemplated   by   this    Agreement.    Amoco   shall   retain
responsibility  for the  matters  referenced  in Exhibit  "G" to the extent the
underlying Claims relate to the period of time prior to Closing.

     10.7 Bankruptcy.  There are no bankruptcy,  reorganization or receivership
proceedings pending, being contemplated by or threatened against Seller.

              ARTICLE 11. BUYER'S REPRESENTATIONS AND WARRANTIES

     Buyer  represents and warrants to Seller that on the date hereof and as of
Closing:

     11.1 Organization   and  Good  Standing.   Buyer  is  a  corporation  duly
organized,  validly  existing and in good standing  under the Laws of the State
of Delaware  and has all  requisite  corporate  power and  authority to own and
lease the  Properties.  Buyer is duly  licensed or  qualified to do business as
a foreign  corporation  and is in good standing in all  jurisdictions  in which
the Properties are located.

     11.2 Corporate  Authority;  Authorization  of  Agreement.  Buyer  has  all
requisite   corporate   power  and   authority  to  execute  and  deliver  this
Agreement,  to consummate the transactions  contemplated  herein and to perform
all the terms and  conditions  to be  performed  by it as provided  for in this
Agreement.  The  execution  and  delivery  of  this  Agreement  by  Buyer,  the
performance  by Buyer of all the terms and  conditions  to be  performed  by it
and the  consummation of the  transactions  contemplated  herein have been duly
authorized  and approved by all  necessary  corporate  action.  This  Agreement
has been duly  executed and  delivered by Buyer and  constitutes  the valid and
binding  obligation of Buyer,  enforceable  against it in  accordance  with its
terms, except as such  enforceability may be limited by bankruptcy,  insolvency
or other Laws relating to or affecting  the  enforcement  of creditors'  rights
and general  principles of equity  (regardless  of whether such  enforceability
is considered in a proceeding at law or in equity).

     11.3 No Violations.  Assuming  expiration or termination of the applicable
waiting  period under the HSR Act, if  applicable,  the  execution and delivery
of this Agreement by Buyer does not, and the  fulfillment  and compliance  with
the  terms and  conditions  hereof  and the  consummation  of the  transactions
contemplated herein, will not:

          11.3.1 Conflict  with or require  the consent of any person or entity
      under any of the terms,  conditions or provisions of the  certificate  of
      incorporation or bylaws of Buyer;

          11.3.2 Violate any  provision  of, or require any filing,  consent or
      approval under any Law applicable to or binding upon Buyer; or

          11.3.3 Conflict  with,  result in a breach of,  constitute  a default
      under or  constitute an event that with notice or lapse of time, or both,
      would  constitute a default under,  accelerate or permit the acceleration
      of the performance required by, or require any consent,  authorization or
      approval under: (i) any mortgage,  indenture,  loan,  credit agreement or
      other  agreement  evidencing  indebtedness  for  borrowed  money to which
      Buyer is a party or by which Buyer is bound, or (ii) any order,  judgment
      or decree of any governmental entity or tribal authority.
 
     11.4 SEC  Disclosure.  Buyer  is  acquiring  the  Properties  for  its own
account  for use in its trade or  business,  and not with a view  toward or for
sale in  connection  with  any  distribution  thereof,  nor  with  any  present
intention  of  making  a  distribution   thereof  within  the  meaning  of  the
Securities Act of 1933, as amended.

     11.5 Independent  Evaluation.  Buyer  represents that it is  sophisticated
in  the  evaluation,   purchase,   ownership  and  operation  of  oil  and  gas
properties  and related  facilities.  In making its decision to enter into this
Agreement  and  to  consummate  the  transaction   contemplated  herein,  Buyer
represents   that:   (a)  it  has   relied   solely  on  its  own   independent
investigation  and  evaluation  of the  Properties,  and  (b) it has  satisfied
itself as to the physical and  environmental condition of the Properties.

     11.6 Buyer's Reliance.  Buyer  acknowledges and agrees that it is entitled
to rely only on the express  representations  and  warranties set forth in this
Agreement.

              ARTICLE 12. ADDITIONAL COVENANTS AND CONSIDERATIONS

     12.1 Subsequent  Operations.    Seller   makes   no   representations   or
warranties   to  Buyer  as  to  the   transferability   or   assignability   of
operatorship  of  the  Properties.  Buyer  acknowledges  that  the  rights  and
obligations  associated  with  operatorship  of the  Properties are governed by
the applicable  agreement(s)  and that  operatorship  of the Properties will be
decided in  accordance  with the terms of said  agreement(s).  Seller agrees to
cooperate  with  Howell  Petroleum  Corporation  with  respect to  operatorship
issues.  Within ten (10) Days after  Closing,  Seller  shall send out  notices,
where  applicable,  advising  working  interest  owners  of the  Properties  it
operates  that it has  transferred  its  interests in the  Properties to Buyer.
Within  fifteen (15) Days after  Closing,  Buyer shall send out ballots,  where
applicable,  associated  with the  selection  of a  successor  operator  of the
Properties.   Seller  shall  have  no  obligation   under  this   Agreement  or
otherwise to send out ballots for the selection of a successor operator.

      12.2 Financial  Assurances.  Buyer  shall  provide a  corporate  guaranty
from an  Affiliate of Buyer  (acceptable  to Seller)  guarantying  the full and
faithful  performance  by Buyer of the terms and  conditions  contained in this
Agreement in the form attached hereto as Exhibit "R".

      12.3 Transition  Agreement.  At Closing,  Buyer and Seller shall  execute
the Transition Agreement.

      12.4 License  Agreement(s).  At Closing,  Buyer and Seller shall  execute
the License  Agreement  - SAMS,  covering  certain  proprietary  technology  of
Seller,  including  the  "SAMS"  automation  system.  If  requested  by Seller,
Buyer shall  execute  and deliver to Seller a License  Agreement - Seismic in a
mutually  agreed form,  granting to Seller,  at no cost to Seller,  a right and
license to use the  seismic  data,  or any portion  thereof,  conveyed to Buyer
under the terms of this Agreement.

      12.5 Sublease  Novation  Agreement.  At Closing,  Buyer and Seller  shall
execute the Sublease  Novation  Agreement  covering the inlet compressor at the
Beaver  Creek Gas  Processing  Plant which is subject to an  existing  sublease
from Amoco Equipment Leasing Company to Seller.

      12.6 Crude Call.

      12.6.1  Seller  reserves  (excluding  the  Beaver  Creek  Field  which is
addressed in Article 12.6.8 below) the  continuing  right and option (but shall
not have the  obligation) to purchase on the terms set forth herein  (including
the terms set forth on Exhibit "S" attached hereto and  incorporated  herein by
reference) all or part of the oil and/or other liquid  hydrocarbons,  including
but not limited to,  condensate,  distillate  and other liquids  recovered from
the well stream by normal lease  separation  methods  (the "Oil")  produced and
saved from any one or more of the Fields listed on Exhibit "S"  (excluding  Oil
used for ordinary leasehold operations thereon).

      12.6.2  Seller  herein  elects to purchase the Oil from the Fields listed
on  Exhibit  "S"  to  be  effective  the  1st  day  of  March,  1998.  Seller's
obligation to purchase the Oil under the above  election  shall  continue for a
period of sixty (60) Days,  and unless  terminated by Seller by giving Buyer at
least sixty (60) Days prior written  notice of Seller's  intent to  discontinue
such purchases, shall continue on a month to month basis thereafter.

       12.6.3  If Seller  notifies Buyer  that  Seller  elects  to  discontinue
purchases  of the Oil in  accordance  with  Article  12.6.2,  at the end of the
sixty (60) Day notice  period,  Buyer  shall be free for a period not to exceed
six (6) months to market the Oil to Third  Parties;  provided  however,  at the
end of the six (6) month  period  Seller  shall  have the  right to  recommence
purchasing  the Oil by providing  Buyer at least sixty (60) Days prior  written
notice  of  Seller's  intent to  recommence  purchasing  the Oil.  In the event
Seller  elects not to recommence  purchasing  the Oil, then Buyer shall be free
to market the Oil to Third  Parties  for an  additional  six (6) month  period.
Sellers  right to elect to  purchase  and/or  discontinue  purchase  of the Oil
shall be an ongoing  and  reoccurring  right  during the  duration of the crude
call (as  determined  in  accordance  with Exhibit  "S").  During the period of
time  Seller is not  purchasing  the Oil under  the terms of this  Article  12,
Seller  shall have no  obligation  to  purchase  or furnish a market for all or
any part of the Oil associated with the Properties.

      12.6.4  During  the  period of time  Seller  elects to  purchase  the Oil
(from all fields  except  the  Beaver  Creek  Field  which  shall be handled in
accordance  with  Article  12.6.8  below)  under the terms of this  Article 12,
subject  to the  Ceiling  and Floor  Pricing  Limitations  set forth on Exhibit
"S", Seller shall pay Buyer the "average  monthly  calculated  price per barrel
of  Oil"  which  shall  be the  average  of the  three  (3)  approved  postings
selected by Buyer  adjusted for  gravity,  plus the price  differential  as set
forth on Exhibit "S". In  determining  the "average  monthly  calculated  price
per barrel of Oil" under this Article  12.6.5,  the parties shall use three (3)
out of the five  (5)  approved  postings  referred  to in  Exhibit  "S".  On or
before  December  1 of each year,  Buyer  shall  select the three (3)  approved
postings  per crude  catagory  (i.e.  Wyoming  Asphaltic  Sour and Wyoming Salt
Creek Sweet) whose postings shall be used in determining  the "average  monthly
calculated price per barrel of Oil" for the succeeding year.

      12.6.5 In the event  one of the  indexes  referenced  on  Exhibit  "S" is
discontinued,  the  parties  shall  meet and  attempt  to  mutually  agree on a
replacement  index which is similar to the  discontinued  index. If the parties
are unable to agree on the  replacement  index,  the same shall be submitted to
binding arbitration in accordance with Article 18.

      12.6.6  Seller's  rights under this Article 12 shall  terminate as to the
individual  Field  listed on Exhibit "S" in  accordance  with the time  periods
set forth on Exhibit "S".

      12.6.7  Notwithstanding  anything  contained  in  this  Agreement  to the
contrary,  Seller  reserves  the right to assign  the  rights  and  obligations
arising  under this Article 12 to an Affiliate of Seller.  If Seller  elects to
assign the rights and  obligations  under this  Article 12 to an  Affiliate  of
Seller,  then Seller shall  provide Buyer with a mutually  agreeable  corporate
guarantee  wherein  Seller  guarantees the  performance  of Seller's  Affiliate
under the terms of this Article 12.

      12.6.8 Buyer shall  solicit  semi-annual  (i.e.  March 1 and September 1)
bids for the  succeeding  six (6)  month  period  from  Third  Parties  for the
purchase of the Oil  produced  from the Beaver  Creek  Field.  Seller  reserves
(in  accordance  with the terms set forth on Exhibit "S" with respect to volume
and  duration)  the  continuing  right  and  option  (but  shall  not  have the
obligation)  to match the highest  written offer  received in  accordance  with
the bid  documents  established  by the  Buyer for the Oil  produced  and saved
from  the  Beaver  Creek  Field  (excluding  Oil used  for  ordinary  leasehold
operations  thereon).  Buyer will  solicit bids under the terms of this Article
12.6.8  at  least  forty-five  (45)  Days  prior to  March 1 and  September  1,
respectively.

         12.7 NGL Call.  Seller  reserves  the continuing right and option (but 
shall not have the  obligation) to purchase at the  tailgate of the  applicable
plant   the    natural  gas  liquids,  including  without  limitation,  ethane,
propane,  butanes,  normal butane,  isobutane  and  DNG  (collectively "NGL's")
associated  with  or  attributed  to the Properties  ("Purchase Right"). In the
event  Seller  desires  to  exercise its Purchase  Right,  it will notify Buyer
of  such  election at least thirty (30) Days  in  advance  of the point in time
it  will  commence  purchasing  said NGL's,  and  such  election  will continue
from  month  to  month  thereafter  until Seller  revokes  such  election  with
thirty  (30) Days  advance  written  notice to Buyer.  If Seller  exercises its
Purchase  Right,  the  price  to be paid by Seller to Buyer for the NGL's shall
be  ninety-seven  percent  (97%)  of   the   weighted  average  selling   price
received  by  Seller  for  said NGL's (on a product  basis) during the month of
delivery  from  the  applicable  plant.  The NGL Call contained in this Article
12.7 shall  have  a  term through  March 31, 1998,  or  the life of the pending
marking  contract  if the same  terminates  prior to  March 31, 1998.   Any and
all  notification  to  Seller  associated with this NGL Call provision shall be
directed to  Amoco  Oil  Company,  NGL Supply and Logistics,  Attn. NGL Supply,
P.O. Box 3092, Houston, Texas 77253-3092.

      12.8 Rights-Of-Way  and Surface  Leases.  Buyer  herein  grants to Seller
(and  its  Affiliates)  non-exclusive  cost-free  right(s)-of-way  and  surface
lease(s)  on, over and through the  Properties  (including  but not limited to,
pipeline,  utility and road usage  rights-of-way,  facility  surface leases and
all  necessary  rights of ingress and  egress),  necessary to allow Seller (and
its  Affiliates) to continue to conduct  operations on or across the Properties
in connection  with  properties  and assets not being  conveyed  herein,  which
were being  conducted by Seller (and its  Affiliates)  prior to Closing.  Buyer
agrees to execute any and all  instruments  deemed  necessary by Seller (or its
Affiliate) to further delineate the rights granted herein.

      12.9 APL\Salt  Creek  Electrical  Service.  Buyer  agrees to  continue to
provide  Amoco  Pipeline  Company,   and  its  successors  and  assigns,   with
electrical  service necessary to operate all Amoco Pipeline Company  facilities
located  in the  vicinity  of the Salt Creek  Unit,  Natrona  County,  Wyoming.
Buyer shall bill Amoco  Pipeline  Company on a semi-annual  basis (i.e.  June 1
and  December 1) for any and all power  actually  consumed to operate the Amoco
Pipeline  Company  facilities.  The fee to be paid by  Amoco  Pipeline  Company
for the power shall be based on the actual  electrical  rates  charged to Buyer
for  electrical  service at the Salt Creek  Unit and the power  usage  shall be
based upon the reading  taken from the deduct  meters  located on the secondary
side of the Salt Creek  electrical  substation  which serve as delivery  points
on  the  Salt  Creek  Unit  electrical   distribution  system.  Amoco  Pipeline
Company  shall own,  operate and maintain the deduct  meters and provide  Buyer
with any and all power  usage  information  necessary  for Buyer to bill  Amoco
Pipeline Company for the power used at the aforementioned facilities.

                         ARTICLE 13. PERSONNEL MATTERS

13.1  Employee Lists.  Prior to Closing,  Seller will make available to Buyer a
list of employees who are directly engaged (the "Directly  Engaged  Employees")
in the  operation,  maintenance,  administration,  measurement,  automation and
similar  functions  for  the  Properties  subject  to this  Agreement,  who are
available  for  immediate  employment  by Buyer  commencing  on the date of the
termination  of the  Transition  Agreement  ("Transition  Date").  In addition,
prior to  Closing,  Seller  will make  available  to Buyer a  separate  list of
employees who are engaged in management,  analysis,  engineering,  supervision,
accounting  and similar  functions who are  available for immediate  employment
by  Buyer   commencing  on  the  Transition  Date.  For  the  purpose  of  this
Agreement,  the above referenced  employees of Seller (whether Directly Engaged
Employees  or  the  employees  on  the  separate  list  shall  collectively  be
referred  to  as  Personnel).   Buyer  shall  not  solicit  employment  of  any
employees of Seller other than those  described  above  without  obtaining  the
advance written  permission of Seller,  except that Buyer may solicit employees
of Seller who did not work in  Seller's  business  groups  associated  with the
Properties.  This  restriction  shall  remain in effect  for  twenty  four (24)
months after Closing.

      13.2 Offers  of  Employment.   Buyer  reasonably   expects  to  need  the
services  of all of the  Directly  Engaged  Employees,  and to that end,  Buyer
will  make  offers  of  employment  to at  least  ninety  percent  (90%) of the
Directly  Engaged  Employees   effective  on  the  Transition  Date,   provided
however,  that Howell Petroleum  Corporation  shall not be obligated to make an
offer of employment to any Directly  Engaged  Employees  assigned to Properties
where  preferential  rights have been  exercised  and/or  Buyer does not become
the  operator of those  Properties.  Buyer may also make  offers of  employment
to  other  employees  on the  lists  provided  who  are  not  Directly  Engaged
Employees.  Any  offers  of  employment  made by Buyer to  employees  of Seller
shall be at substantially  similar  salaries or wages,  with similar duties and
responsibilities  at the same  location  that  such  employee  had  immediately
prior to the  Transition  Date.  Buyer  shall also  provide to these  employees
the same  employee  benefit  plans and  policies  as  provided  by Buyer to its
employees   performing  similar  work.  To  the  extent  any  Directly  Engaged
Employee is on military,  family, or medical leave,  Buyer shall give each such
Directly  Engaged Employee  consideration  for employment in the same manner as
it does for other employees;  provided however,  Buyer may condition such offer
upon the  employee's  return from leave  within one (1) year of the  Transition
Date and,  in the case of medical  leave,  that such return to work is approved
by Buyer's physician.

      13.3  Pension Plans. (a)  Buyer agrees that,  effective as  of Transition 
Date, Buyer will include in its  simplified employee  pension plan (" Buyer SEP
Plan") those employees who commence employment with Buyer and who  participated
in   the  Employee  Retirement  Plan  of  Amoco and   Participating   Companies
("Amoco Retirement Plan") prior to the Transition Date.Buyer agrees to take any
action  necessary so that:  (i) such  employees will be eligible to participate
in the Buyer SEP Plan as of the  Transition Date, and (ii) such  employees will
be given service credit equal to the number of years of  participation  service
and vesting service such employees have under the Amoco Retirement Plan for the 
purposes of both vesting service and eligibility service in the Buyer SEP Plan. 
Article 13.3 shall not apply in the event that Buyer terminates or discontinues
its Buyer SEP Plan prior to the Transition Date.

           (b)  Seller   agrees  to  furnish  on  a  timely  basis  a  list  of
      employee's vesting service recognized under the Amoco Retirement Plan.

      13.4 Thrift Plan and Stock Purchase  Plans.  Buyer shall allow  employees
hired  pursuant to Article 13.2 to  immediately  participate  in Buyer's thrift
plan,  stock  purchase  plan,  and other similar plans ("Buyer Thrift and Stock
Purchase  Plans").  Buyer shall  credit  employee's  prior  service  with Amoco
and its Affiliates as determined  under Article  13.3(a) for all purposes under
Buyer  Thrift and Stock  Purchase  Plans,  including  but not  limited  to, any
vesting or matching  schedules.  Article 13.4 shall not apply in the event that
Buyer  terminates or  discontinues  its Buyer Thrift and Stock  Purchase  Plans
prior to the Transition Date, as applicable.


      13.5 Other  Employee  Benefits.  Buyer shall  recognize the prior service
with  Seller and its  Affiliates  of  employees  for all  purposes,  including,
without  limitation,   eligibility,  vesting,  and  benefit  determination  and
accrual,  in  connection  with other  employee  benefits and  policies  such as
vacations,  bonuses,  sickness  and  disability  leave and all  other  employee
benefits  and  policies.  Except  as  otherwise  provided  in  this  Agreement,
employees and their eligible  dependents  who are enrolled in medical,  dental,
life insurance and long-term  disability  plans  available to such employees as
a result of their  employment  by Seller  immediately  prior to the  Transition
Date  shall be  eligible  to enroll in any plan or plans  established  by Buyer
which  provide  similar  benefits to its employees as of the  Transition  Date.
If employees  enroll in such plans,  no physical  examination or other proof of
insurability   shall  be   required.   Also,   all  coverage   exclusions   and
limitations  relating  to  waiting  periods  or  pre-existing  conditions  with
respect to such  personnel  or their  dependents  shall be waived.  Buyer shall
be responsible for  perpetuating  the group health plan  continuation  coverage
pursuant to Section  4980B of the Internal  Revenue  Code of 1986,  as amended,
and  Sections  601 through 609 of ERISA for all  employees  and their  eligible
dependents and shall cover such  employees  under Buyer's own group health plan
to  accommodate  this  requirement.  Buyer shall  indemnify and hold Seller and
its  Affiliates  harmless from and against any and all liability  Seller or its
Affiliates  incur after the  Transition  Date under the  provisions  of Section
4980B or the Code or  Sections  601  through  609 of ERISA with  respect to any
Personnel,  or  dependent  or  spouse  of  such  employees,  who  had  or has a
"qualifying  event" (within the meaning of Section  4980B(f)(3) of the Code) on
or after the Transition Date.

      13.6 Accrued and Unused  Vacation.  Between the  Transition  Date and the
end of the  calendar  year in which the  Transition  Date  occurs,  Buyer shall
permit all former  employees of Seller to take,  as unpaid  leave,  a number of
days  equal to the  number of days of  vacation  as such  employees  would have
been  eligible  to take  immediately  prior to the  Transition  Date  under the
vacation  policy  of  Seller,  based  upon  the  original  hire  date  of  such
Personnel by Seller or its  Affiliates.  Seller  shall timely  provide to Buyer
a list of employee's  remaining  vacation balances for 1998.  Effective January
1, 1999  former  employees  of Seller  employed  by Buyer  shall be entitled to
participate in Buyer's vacation policy then in effect.

      13.7 Severance.Buyer  acknowledges  that Seller's former  employees would
have been eligible to receive the severance  benefits  described in the current
1997 Amoco Corporation and  Participating  Affiliates  Severance  Benefits Plan
(the "Amoco Severance Plan"),  had they not been offered  comparable  positions
with  Buyer.  Therefore,  Buyer  agrees  to  provide  a  severance  payment  to
employees  who it  terminates  within  one  year  of  the  Transition  Date  as
provided in the severance  schedule in the Amoco  Severance  Plan, and pursuant
to the same terms and  conditions of employee  eligibility  as described in the
Amoco  Severance  Plan.  For purposes of  calculating  the severance  allowance
described  in the  Amoco  Severance  Plan,  "credited  service"  shall  include
service  with Seller  and/or its  Affiliates  in addition to service with Buyer
and/or its Affiliates  for  employees.  Buyer also agrees to include Seller and
its  Affiliates  as  third  party  beneficiaries  in any  release  executed  by
employees in order to receive these severance benefits.

      13.8 Post Transition Date Benefits. The   obligations   of  Article  13.5
shall apply to any benefit  plans or  policies  established  by Buyer after the
Closing.  In  addition,  Buyer  shall  establish  a savings  plan  pursuant  to
Section 401(k) of the Internal  Revenue Code within  forty-five (45) Days after
the  Transition  Date.   Buyer  shall  take  all  reasonable   action  both  in
establishing  and  administering  that savings plan to allow employees to elect
to transfer  their Amoco  Savings  Plan  ("Amoco  Savings  Plan")  accounts and
loans to Buyer's  savings  plan  pursuant to a trust to trust  transfer  within
ninety  (90) Days after the  Transition  Date.  Buyer shall also  provide  that
employees  are  eligible  for  immediate  participation  in the saving plan and
shall grant  employees  credit for prior service with Amoco and its  Affiliates
for all  purposes  including,  but not  limited  to, any  vesting  or  matching
schedules.

      13.9 WARN Act. Buyer  represents and warrants that there will be no major
employment  losses as a consequence of the  transactions  contemplated  by this
Agreement  that  might  trigger  obligations  under the Worker  Adjustment  and
Retraining  Notification  Act,  29 U.S.C.  Section  2101 et seq.,  or under any
similar  provision  of any federal,  state,  regional,  foreign,  or local law,
rule,  or  regulation   (referred  to  collectively  as  "WARN   Obligations").
Moreover,   to  the  extent  that  any  WARN  Obligations   might  arise  as  a
consequence of the  transactions  contemplated by this Agreement,  it is agreed
that Seller shall be responsible for any WARN  Obligations  arising as a result
of any  employment  losses  occurring  prior to  Closing,  and  Buyer  shall be
responsible  for any WARN  Obligations  arising  as a result of any  employment
losses  occurring  upon or after  Closing.  Furthermore,  for the first  ninety
(90) Days following Closing,  Buyer shall not engage in any mass layoff,  plant
closing,  or other action that might  trigger  obligations  of Seller under the
WARN Act or under  any  similar  provision  of any  federal,  state,  regional,
foreign, or local law, rule, or regulation.


                              ARTICLE 14. HSR FILINGS

     14.1  HSR  Filings.  If  compliance  with  the  HSR  Act  is  required  in
connection  with  the  transaction   contemplated  under  this  Agreement,   as
promptly as  practicable  and in any event not more than fifteen (15)  Business
Days  following  the date on which the parties have  executed  this  Agreement,
both parties will file with the Federal  Trade  Commission  and the  Department
of Justice,  as applicable,  the notification and report forms required for the
transactions  contemplated  herein and will as promptly as practicable  furnish
any supplemental  information  which may be reasonably  requested in connection
therewith.  Each party shall  request  expedited  treatment of such filing.  If
failure by either party to obtain timely  authorization  from the Federal Trade
Commission  or the  Department  of  Justice  results  in the  inability  of the
parties  to  Close  on  the  Closing   Date,   the  time  for   Closing   shall
automatically  be extended  until such date as Closing can occur in  compliance
with the HSR Act.

                  ARTICLE 15. CONDITIONS PRECEDENT TO CLOSING

      15.1 Conditions  Precedent to Seller's  Obligation to Close. Seller shall
be obligated to consummate the sale of the Properties as  contemplated  by this
Agreement on the Closing  Date,  provided the  following  conditions  precedent
have been satisfied or have been waived by Seller:

           15.1.1 All  representations  and  warranties  of Buyer  contained in
      this Agreement shall be true and correct in all material  respects at and
      as of Closing as though such  representations and warranties were made at
      and as of such time; and

           15.1.2 Buyer shall have  complied in all material  respects with all
      obligations  and  conditions  contained in this Agreement to be performed
      or complied with by Buyer on or prior to Closing.

      15.2 Conditions  Precedent to Buyer's  Obligation  to Close.  Buyer shall
be obligated to consummate  the purchase of the Properties as  contemplated  by
this  Agreement  on  the  Closing  Date,  provided  the  following   conditions
precedent have been satisfied or have been waived by Buyer:

           15.2.1 All  representations  and  warranties of Seller  contained in
      this Agreement shall be true and correct in all material  respects at and
      as of Closing as though such  representations and warranties were made at
      and as of such time; and

           15.2.2  Seller  shall have  complied in all material  respects  with
      all  obligations  and  conditions  contained  in  this  Agreement  to  be
      performed or complied with by Seller on or prior to Closing.

      15.3 Conditions  Precedent  to  Obligation  of Each  Party to Close.  The
parties  shall  be  obligated  to  consummate  the  sale  and  purchase  of the
Properties as  contemplated  in this  Agreement on the Closing  Date,  provided
the following  conditions  precedent have been satisfied or have been waived by
the applicable party:

           15.3.1  No suit,  action  or  other  proceedings  shall  be  pending
      before  any  court or  governmental  entity  in which it is  sought  by a
      person  or  entity  other  than  the  parties  hereto  or  any  of  their
      Affiliates,  officers,  directors or  employees  to  restrain,  enjoin or
      otherwise  prohibit the consummation of the transactions  contemplated by
      this Agreement,  or to obtain substantial  damages in connection with the
      transaction  contemplated herein, nor shall there be any investigation by
      a  governmental  entity  pending  which  might  result in any such  suit,
      action or other  proceedings  seeking to  restrain,  enjoin or  otherwise
      prohibit  the  consummation  of  the  transaction  contemplated  by  this
      Agreement;

           15.3.2 If applicable,  consummation of the transaction  contemplated
      herein shall not have been  prevented from occurring by (and the required
      waiting  period,  if any,  shall have expired  under) the HSR Act and the
      rules and  regulations of the Federal Trade  Commission or the Department
      of Justice;

           15.3.3  All  consents  and  approvals,   if  any,  whether  required
      contractually or by applicable  federal,  state,  local or tribal Law, or
      otherwise  necessary for the execution,  delivery and performance of this
      Agreement (except for consents and approvals of governmental  entities or
      tribal  authorities  customarily  obtained  subsequent to the transfer of
      title)  shall have been  obtained and  delivered  to Buyer or Seller,  as
      applicable, by Closing  and shall not have been withdrawn or revoked; and

           15.3.4  With  respect to  Properties  which  have not been  excluded
      from this  Agreement  because  of  exercise  of a  preferential  purchase
      right,  if any,  the  preferential  purchase  rights  applicable  to such
      Properties  shall  have  been  waived,  or the time to elect  under  such
      preferential purchase rights shall have elapsed, prior to Closing.
 
                            ARTICLE 16. THE CLOSING

      16.1 Closing.  Three (3) Business Days prior to the Closing Date,  Seller
shall provide Buyer with a Closing  statement  setting forth the Purchase Price
adjusted  in  accordance  with  the  terms  of  this  Agreement.  Seller  shall
additionally  provide Buyer with wiring  instructions  designating  the account
or accounts to which the Closing funds are to be delivered in  accordance  with
Article  16.3.5.  Closing  shall be held in  Seller's  office at the 4th Floor,
550 WestLake Park  Boulevard,  Houston,  Texas 77079, or such other location as
mutually agreed in writing by Seller and Buyer.

      16.2 Obligations of Seller at Closing.  At Closing,  Seller shall deliver
to Buyer, unless waived by Buyer, the following:

           16.2.1  A  document  conveying  all of  Seller's  right,  title  and
      interests  in and to the  Properties  substantially  in the  form  of the
      Assignment  and  Bill  of  Sale  attached  hereto  as  Exhibit  "I".  The
      Assignment  and Bill of Sale shall be executed and  acknowledged  in four
      (4)  multiple  originals  or such  greater  number as agreed  between the
      parties;

           16.2.2  A  document  conveying  all of  Seller's  right,  title  and
      interests  in  and  to  surface  interests  which  are  included  in  the
      Properties  substantially in the form of the Surface Deed attached hereto
      as  Exhibit "J".  The Surface Deed shall be executed and  acknowledged in
      four (4) multiple  originals or such greater number as agreed between the
      parties;
 
           16.2.3  A  document  conveying  all of  Seller's  right,  title  and
      interests  in and to the  mineral  interests  which are  included  in the
      Properties  substantially in the form of the Mineral Deed attached hereto
      as  Exhibit "K".  The Mineral Deed shall be executed and  acknowledged in
      four (4) multiple  originals or such greater number as agreed between the
      parties;

           16.2.4 Executed  and  acknowledged  assignments  of all of  Seller's
      right,  title and interest in and to federal,  state or tribal  interests
      included in the Properties on approved forms for such purpose;

           16.2.5 A  Certificate  executed  by an  Attorney-in-Fact  of  Seller
      certifying  as to the matters  specified  in  Articles  15.2.1 and 15.2.2
      above substantially in the form of Exhibit "L";

           16.2.6 Letters-in-Lieu   of  division   orders  or  transfer  orders
      executed by an  Attorney-in-Fact  of Seller  substantially in the form of
      Exhibit "M";

           16.2.7 An Opinion  of Counsel  executed  by an  attorney  for Seller
      substantially in the form of Exhibit "N";

           16.2.8 A Non-Foreign  Affidavit executed by an  Attorney-in-Fact  of
      Seller substantially in the form of Exhibit "O";

           16.2.9 A Transition  Agreement  executed by an  Attorney-in-Fact  of
      Seller substantially in the form of Exhibit "P";

           16.2.10 A License  Agreement  - SAMS  substantially  in the  form of
      Exhibit  "Q",  and a License  Agreement  - Seismic in a  mutually  agreed
      form,  as provided for in Article 12.4,  executed by an  Attorney-in-Fact
      of Seller.

           16.2.11 A   Sublease    Novation    Agreement    executed    by   an
      Attorney-in-Fact of Seller substantially in the form of Exhibit "R";

           16.2.12 Evidence that all consents and  approvals  prerequisite  for
      the sale and  conveyance  of the  Properties  (except  for  consents  and
      approvals  of  governmental  entities or tribal  authorities  customarily
      obtained  subsequent  to the  transfer of title) have been  obtained,  as
      well as  evidence  of  waiver  or lapse of any  unexercised  preferential
      purchase rights applicable to the Properties; and

           16.2.13 Such other instruments  as  necessary  to carry out Seller's
      obligations under this Agreement.

      16.3 Obligations  of Buyer at Closing.  At Closing,  Buyer shall  deliver
to Seller, unless waived by Seller, the following:

           16.3.1 The adjusted  Purchase Price (plus  Computed  Interest on the
      Purchase Price from the Effective  Time through  Closing,  if due),  less
      Deposit (plus  Computed  Interest on the Deposit from the date of receipt
      by Seller until Closing), by wire transfer in accordance with Article 3.

           16.3.2 The  Assignment  and  Bill of  Sale,  executed  and  properly
      acknowledged, referred to in Article 16.2.1;

           16.3.3 The  Surface  Deed,   executed  and  properly   acknowledged,
      referred to in Article 16.2.2;

           16.3.4 The  Mineral  Deed,   executed  and  properly   acknowledged,
      referred to in Article 16.2.3;

           16.3.5 The  federal,  state and  tribal  assignments,  executed  and
      properly acknowledged, referred to in Article 16.2.4;

           16.3.6 A   Certificate   executed  by  an   authorized   officer  or
      Attorney-in-Fact  of Buyer  certifying  as to the  matters  specified  in
      Articles 15.1.1 and 15.1.2 substantially in the form of Exhibit "L";

           16.3.7 Letters-in-Lieu   of  division   orders  or  transfer  orders
      executed  by  an  authorized   officer  or   Attorney-in-Fact   of  Buyer
      substantially in the form of Exhibit "M";

           16.3.8 An Opinion  of  Counsel  executed  by an  attorney  for Buyer
      substantially in the form of Exhibit "N";

           16.3.9 A Transition  Agreement  executed by an authorized officer or
      Attorney-in-Fact of Buyer substantially in the form of Exhibit "P";

           16.3.10 A License  Agreement  - SAMS  substantially  in the  form of
      Exhibit  "Q",  and a License  Agreement  - Seismic in a  mutually  agreed
      form, as provided for in Article 12.4,  executed by an authorized officer
      or Attorney-in-Fact of Buyer;

           16.3.11 A Sublease  Novation  Agreement  executed  by an  authorized
      officer  or  Attorney-in-Fact  of  Buyer  substantially  in the  form  of
      Exhibit "R";

           16.3.12 The corporate guaranty referenced in Article 12.2;

           16.3.13 Within  thirty   (30)  Days  after   Closing,   evidence  of
      compliance with all  governmental  and tribal  requirements,  if any, for
      the  posting  of  plugging  or other  applicable  bonds  relating  to the
      ownership or operation of the Properties; and

           16.3.14 Such other instruments  as  necessary  to carry out  Buyer's
      obligations under this Agreement.

                                   ARTICLE 17. TERMINATION

      17.1 Grounds for  Termination.  This  Agreement  may be terminated at any
time prior to Closing:

           17.1.1 By the mutual written agreement of Seller and Buyer;

           17.1.2 By  either  Seller  or  Buyer  if  the  consummation  of  the
      transactions  contemplated  herein would violate any nonappealable  final
      order,  decree or judgment  of any court or  governmental  entity  having
      appropriate  jurisdiction  enjoining or awarding  substantial  damages in
      connection with the consummation of the transactions contemplated herein;

           17.1.3 Notwithstanding  anything  contained in this Agreement to the
      contrary,  Seller  shall  have the right (to the  extent  Closing  is not
      delayed as a result of Seller's  conduct) to terminate  this Agreement if
      Closing shall not have occurred by December 31, 1997.

      17.2 Effect  of   Termination.   If  this   Agreement  is  terminated  in
accordance with Article 17.1, such  termination  shall be without  liability to
any  party,  except  return  of the  Deposit  (plus  Computed  Interest  on the
Deposit  from  the  date  of  receipt  by  Seller  until  termination  of  this
Agreement)  and  performance  of the  obligations  provided in  Articles  17.3,
17.4,  17.5,  18.1,  19.3,  19.10,   19.12,   19.14,  19.15  and  19.17  (which
provisions  shall survive  termination  of this  Agreement).  If this Agreement
is  terminated  as a result  of  Buyer's  failure  or  refusal  to  perform  an
obligation  hereunder  (including  without  limitation  Closing on the  Closing
Date),  Seller  shall be entitled to retain the Deposit as  liquidated  damages
(and not as a  penalty)  to  reimburse  Seller for its  out-of-pocket  fees and
expenses  incurred in connection  with the  transactions  contemplated  by this
Agreement.  The  liquidated  damages  referenced  above shall be in addition to
and not  exclusive  of  other  remedies  which  may be  available  at law or in
equity.

      17.3 Dispute over Right to Terminate.  If there is a dispute  between the
parties over either  party's right to terminate  this  Agreement  under Article
17.1 or  otherwise,  Closing  shall not occur,  as  scheduled.  The party which
disputes  the other  party's  right to  terminate  the  Agreement  may initiate
binding  arbitration  proceedings in accordance with Article 18.1 within thirty
(30)  Days of the  date on  which  Closing  was  scheduled  to  occur  and,  if
arbitration  is so  initiated,  the  dispute  will  be  resolved  through  such
binding  arbitration  proceeding.  If the party which disputes the  termination
right does not  initiate  arbitration  to resolve the  dispute  within the time
period  specified  hereinabove,  such party  shall be deemed to have waived for
all purposes its right to object to or dispute such termination.

      17.4 Return  of  Documents.  If this  Agreement  is  terminated  prior to
Closing,  Buyer shall return to Seller all books, records,  maps, files, papers
and  other   property  of  Seller  in  Buyer's   possession   relating  to  the
transaction contemplated by this Agreement.

      17.5 Confidentiality.  Notwithstanding  the termination of this Agreement
or any other  provision  of this  Agreement to the  contrary,  the terms of the
Confidentiality  Agreement  dated  the 9th day of July,  1997,  by and  between
Seller  and Buyer  ("Confidentiality  Agreement"),  shall  remain in full force
and effect.  If Closing of the  transaction  contemplated  herein  occurs,  the
Confidentiality   Agreement  shall  terminate  (which   termination   shall  be
effective as of the Closing).

                            ARTICLE 18. ARBITRATION

      18.1 Arbitration.   Unless   expressly   provided   otherwise   in   this
Agreement,  any and all  disputes  arising  under the  terms of this  Agreement
("Arbitrable  Dispute")  shall be referred to and  resolved  through the use of
binding  arbitration  using  three  (3)  arbitrators,  in  accordance  with the
Commercial Arbitration Rules of the American Arbitration  Association,  and the
Federal  Arbitration  Act (Title 9 of the United States Code).  If there is any
inconsistency  between  this  Article  and any  statute or rules,  the terms of
this  Article  shall  control  the  rights  and  obligations  of  the  parties.
Arbitration  shall be initiated  within the applicable time limits set forth in
this  Agreement  and not  thereafter  or if no time limit is given,  within the
time  period  allowed by the  applicable  statute of  limitations.  Arbitration
shall be  initiated by one (1) party  ("Claimant")  serving  written  notice on
the  other  party   ("Respondent")  that  the  Claimant  elects  to  refer  the
Arbitrable  Dispute  to  binding   arbitration,   and  that  the  Claimant  has
appointed  an  arbitrator,   who  shall  be  identified  in  such  notice.  The
Respondent  shall  respond  to the  Claimant  within  thirty  (30)  Days  after
receipt  of  Claimant's  notice,  identifying  the  arbitrator  Respondent  has
appointed.  The two (2)  arbitrators so chosen shall select a third  arbitrator
(who  must  have not less  than ten  (10)  years  experience  as an oil and gas
lawyer)  within  thirty  (30)  Days  after  the  second   arbitrator  has  been
appointed.  Seller shall pay the  compensation  and expenses of the  arbitrator
named by or for it, and Buyer shall pay the  compensation  and  expenses of the
arbitrator  named by or for it.  Seller and Buyer  shall each pay  one-half  of
the  compensation  and  expenses  of the  third  arbitrator.  Unless  expressly
provided  otherwise in this Agreement,  all arbitrators must be neutral parties
who have never been  officers,  directors or employees of the parties or any of
their Affiliates.  Additionally,  unless expressly  provided  otherwise in this
Agreement,  the two (2)  arbitrators  named by the  parties  must have not less
than ten (10) years  experience  in the oil and gas  industry,  and must have a
formal  education in the area of dispute  (i.e.,  accounting  for an accounting
dispute,  etc.).  The hearing shall be commenced  within thirty (30) Days after
the selection of the third  arbitrator.  The parties and the arbitrators  shall
proceed  diligently  and in good faith in order that the award shall be made as
promptly  as  possible.  The  decision of the  arbitrators  shall be binding on
and  non-appealable  by  the  parties.  The  arbitrators  shall  not  have  the
authority  to grant or award  indirect,  consequential,  punitive or  exemplary
damages.

                           ARTICLE 19. MISCELLANEOUS

      19.1 Notices.  All notices and other communications  required,  permitted
or  desired  to be given  hereunder  must be in  writing  and sent by: (a) U.S.
mail,  properly  addressed  as shown  below,  and with all  postage  and  other
charges  fully  prepaid,  (b) hand  delivery,  or (c)  facsimile  transmission.
Date of service by mail and hand  delivery  is the date on which such notice is
received by the  addressee  and by facsimile is the date sent (as  evidenced by
fax  machine  confirmation  of  receipt),  or if such date is not on a Business
Day,  then on the next date  which is a  Business  Day.  Each  party may change
its address by notifying the other party in writing.

              If to Seller         Amoco Production Company
              by mail:             P.O. Box 3092
                                   Houston, Texas 77253-3092
                                   Attn: General Manager of Business Development
                                         AEGNA Acquisitions and Divestments

              If to Seller         Amoco Production Company
              by hand delivery:    550 WestLake Park
                                   Boulevard, 4th floor
                                   Houston, Texas 77079
                                   Attn: General Manager of Business Development
                                         AEGNA Acquisitions and Divestments

              If to Seller         Amoco Production Company
              by facsimile:        Number: 281-366-7544
                                   Attn: General Manager of Business Development
                                         AEGNA Acquisitions and Divestments


              If to Buyer          Howell Petroleum Corporation
              by mail:             1111 Fannin, Suite 1500
                                   Houston, Texas 77002-6923
                                   Attn: President
 
              If to Buyer          Howell Petroleum Corporation
              by hand delivery:    1111 Fannin, Suite 1500
                                   Houston, Texas 77002-6923
                                   Attn: President

              If to Buyer          Howell Petroleum Corporation
              by facsimile:        Number: 713-658-4007
                                   Attn: President

      19.2 Conveyance Costs.  Buyer shall be solely  responsible for filing and
recording  documents  related to the transfer of the Properties  from Seller to
Buyer and for all  costs  and fees  associated  therewith,  including,  without
limitation,  filing the assignment of the Properties with appropriate  federal,
state,  local and tribal  authorities  as required by  applicable  Law. As soon
as practicable  after recording or filing,  Buyer shall furnish Seller with all
recording data and evidence of all required filings.

      19.3 Brokers'  Fees.  Buyer  has not  retained  any  brokers,  agents  or
finders and none are  affiliated  with Buyer or  authorized to act on behalf of
Buyer in this  matter.  Buyer  agrees to release,  protect,  indemnify,  defend
and hold  Seller  Group  harmless  from and  against  any and all  Claims  with
respect to any  commissions,  finders'  fees or other  remuneration  due to any
broker,  agent or finder claiming by, through or under Buyer.  Seller agrees to
release,  protect,  indemnify,  defend and hold Buyer Group  harmless  from and
against any and all Claims with respect to any  commissions,  finders'  fees or
other  remuneration due to any broker,  agent or finder claiming by, through or
under Seller.

      19.4 Records.  Upon  execution  of this  Agreement,  Seller  shall  grant
Buyer  reasonable  access  to  the  Records.   Within  sixty  (60)  Days  after
termination  of the Transition  Agreement  (except as provided  below),  Seller
shall  furnish to Buyer all Records which are  maintained  by Seller;  provided
however,  Seller  shall be  entitled  to retain:  (a) copies of any or all such
Records,  (b) originals of any Records  required in connection  with litigation
or other proceedings  pending or threatened  against Seller and associated with
the  Properties,  (c)  originals  of any Records  required in  connection  with
title or  environmental  due diligence,  (d) originals of any Records  required
in  connection  with the Final  Accounting  Settlement,  (e)  originals  of any
Records  required in  connection  with any  transition  activities,  and/or (f)
originals  of  any  Records   associated   with  any  retained   properties  or
interests.   Any  and  all  original   Records  retained  by  Seller  shall  be
furnished to Buyer within thirty (30) Days after Seller's  reasonable  need for
said Records  ceases.  Where  Seller  retains  originals of the Records,  Buyer
shall have the right to copy any and all original  Records so  retained.  Buyer
agrees to maintain  the Records  received  from Seller in  accordance  herewith
for a period of seven  (7) years  after the  Closing  and shall  afford  Seller
full  access  to the  Records  as  reasonably  requested  by  Seller.  If Buyer
desires to  destroy  the  Records,  or any  portion  thereof,  it shall  notify
Seller prior to such  destruction,  and provide Seller the  opportunity to take
possession of the same.

      19.5 Further  Assurances.  From and  after  Closing,  at the  request  of
Seller but without  further  consideration,  Buyer will  execute and deliver or
use  reasonable  efforts  to cause to be  executed  and  delivered  such  other
instruments  of  conveyance  and take such other  actions as Seller  reasonably
may  request to more  effectively  put  Seller in  possession  of any  property
which was not  intended  by the  parties  or should not have been  conveyed  by
Seller  (including  without  limitation,  reassignment  from Buyer to Seller of
any Properties which were conveyed in violation of a valid  preferential  right
to  purchase  or  consent  to  assignment).  From  and  after  Closing,  at the
request of Buyer but without  further  consideration,  Seller shall execute and
deliver or use  reasonable  efforts to cause to be executed and delivered  such
other   instruments  of  conveyance  and  take  such  other  actions  as  Buyer
reasonably  may  request to more  effectively  put Buyer in  possession  of the
Properties.   If  any  of  the  Properties  are  incorrectly   described,   the
description  shall be  corrected  upon  proof of the proper  description.  From
and after  Closing,  Buyer and  Seller  shall  each  execute,  acknowledge  and
deliver to the other such further  instruments  and take such further action as
may be reasonably  requested in order to more  effectively  assure to the other
the full  beneficial  use and  enjoyment  of the  Properties  and  otherwise to
accomplish the purposes of the transaction contemplated by this Agreement.

      19.6 Survival of  Representations  and  Warranties.  The  representations
and warranties  contained in Article 10 of this Agreement  shall  terminate one
(1) year after Closing.  All other  representations,  warranties,  indemnities,
covenants  and  agreements  contained  in  this  Agreement  shall  survive  the
Closing   indefinitely.   The   parties   have  made  no   representations   or
warranties, except those expressly set forth in this Agreement.

      19.7 Amendments  and  Severability.  No  amendments  or other  changes to
this  Agreement  shall be effective or binding on either of the parties  unless
the  same  shall be in  writing  and  signed  by both  Seller  and  Buyer.  The
invalidity  of any one or more  provisions of this  Agreement  shall not affect
the  validity  of  this  Agreement  as  a  whole,  and  in  case  of  any  such
invalidity,  this Agreement shall be construed as if the invalid  provision had
not been included herein.

      19.8 Successors  and  Assigns.  This  Agreement  shall  not be  assigned,
either  in  whole  or in part,  without  the  express  written  consent  of the
non-assigning  party;  provided  however,  Buyer shall upon obtaining the prior
written  consent of Seller (which consent shall not be  unreasonably  withheld)
have  the  right  to  assign  this  Agreement  to  an  Affiliate.   The  terms,
covenants  and  conditions  contained in this  Agreement  shall be binding upon
and  shall  inure to the  benefit  of Seller  and  Buyer  and their  respective
successors  and assigns,  and such terms,  covenants  and  conditions  shall be
covenants  running  with  the  land  and  with  each  subsequent   transfer  or
assignment of the Properties.

      19.9 Headings.  The titles and headings set forth in this  Agreement have
been  included  solely for ease of reference and shall not be considered in the
interpretation or construction of this Agreement.

      19.10 Governing Law.  This  Agreement  (including  administration  of the
binding  arbitration  provision set forth in Article 18.1) shall be governed by
and construed  under the Laws of the State of Wyoming,  excluding any choice of
law  rules   which  may  direct  the   application   of  the  Laws  of  another
jurisdiction.

      19.11 No Partnership Created.  It is not the purpose or intention of this
Agreement  to  create  (and it shall  not be  construed  as  creating)  a joint
venture,  partnership  or any  type of  association,  and the  parties  are not
authorized  to act as agent or  principal  for each other  with  respect to any
matter related hereto.

      19.12 Public Announcements.  Neither  Seller nor Buyer  (including any of
their  Affiliates  in either  case)  shall  issue a public  statement  or press
release with respect to the  transaction  contemplated  herein  (including  the
price and other terms)  without the prior  written  consent of the other party,
except  as  required  by Law or  listing  agreement  with a  national  security
exchange and then only after prior consultation with the other party.

      19.13 No Third Party Beneficiaries.  Nothing  contained in this Agreement
shall  entitle   anyone  other  than  Seller  or  Buyer  or  their   authorized
successors  and assigns to any claim,  cause of action,  remedy or right of any
kind whatsoever.

      19.14 Waiver of  Consumer  Rights.  As  partial   consideration  for  the
parties  agreeing to enter into this  Agreement,  the  parties  each can and do
expressly   waive  the  provisions  of  the  Texas  Deceptive  Trade  Practices
Consumer  Protection  Act,  Article 17.41 et seq.,  Texas Business and Commerce
Code, a law  that  gives consumers special rights and protection, and all other 
consumer  protection Laws of the State of Texas, or any other state, applicable
to this transaction that may be waived by the parties.  It is not the intent of
the  parties  to waive and the  parties  shall not waive any applicable  Law or
provision  thereof  which is  prohibited by Law from being waived.  The parties
hereto   represent  that  they  have  had  an  adequate opportunity  to  review
the  preceding   waiver   provision,   including  the opportunity to submit the
same to legal  counsel  for review and  comment  and after consultation with an
attorney  of  their  own  selection  voluntarily  consent  to  this waiver, and
understand the rights being waived herein.

      19.15 Not to be Construed Against Drafter.  The parties  acknowledge that
they  have had an  adequate  opportunity  to review  each and  every  provision
contained  in this  Agreement  and to  submit  the  same to legal  counsel  for
review and comment,  including  without  limitation the waivers and indemnities
in  Articles  4.3,  5.3, 8, 9, 19.3,  19.6 and 19.14.  Based on said review and
consultation,  the  parties  agree with each and every term  contained  in this
Agreement.  Based  on the  foregoing,  the  parties  agree  that  the  rule  of
construction  that a contract be construed  against the drafter,  if any, shall
not be applied in the interpretation and construction of this Agreement.

      19.16 Tax Deferred   Exchange   Election.   Either  party  may  elect  to
structure  the  conveyance  of the  Properties  as  part of an  exchange  under
Article 1031 of the  Internal  Revenue  Code of 1986,  as amended.  The parties
agree to execute all documents,  conveyances or other instruments  necessary to
effectuate an Article 1031 exchange.

      19.17  Conspicuousness  of Provisions.  The parties  acknowledge that the
provisions  contained in this  Agreement that are set out in "bold" satisfy the
requirement  of the express  negligence  rule and any other  requirement at law
or in equity that provisions  contained in a contract be  conspicuously  marked
or highlighted.

      19.18 Execution in  Counterparts.  This  Agreement  may  be  executed  in
counterparts,  which  shall when taken  together  constitute  one (1) valid and
binding agreement.

      19.19 Entire Agreement.  his Agreement and the Confidentiality  Agreement
supersede all prior and contemporaneous negotiations,  understandings,  letters
of  intent  and  agreements  (whether  oral or  written)  between  the  parties
relating  to  the  Properties  and  constitute  the  entire  understanding  and
agreement  between the  parties  with  respect to the sale and  purchase of the
Properties.

     The parties  have  executed  this  Agreement on the day and year first set
forth above.


                   AMOCO PRODUCTION COMPANY


                   By:    ______________________
                   Name:  Lon O. Buehner
                   Title: Attorney-in-Fact

                   HOWELL PETROLEUM CORPORATION



                   By:________________________________
                   Name:  Robert T. Moffett
                   Title: Vice President
                          Howell Petroleum Corporation

ATTEST


By:__________________________ 
Name:  John E. Brewster, Jr.
Title: Assistant Secretary
       Howell Petroleum Corporation




                                  EXHIBIT "A"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                 WORKING INTERESTS AND NET REVENUE INTERESTS 

                             SEE ATTACHED DOCUMENT
                             SIXTY TWO (62) PAGES

                                  EXHIBIT "B"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer

                  PREFERENTIAL PURCHASE AND DEFECT ALLOCATION

          Properties
Allocated Value

----------------------------------------------------------------
Beaver Creek Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Beaver Creek Unit as more particularly        $  187,068,000
   described in that certain Co-operative
   Development Contract Beaver Creek
   Structure dated March 29, 1937, and that
   certain Operating Agreement  to Accompany
   Cooperative Development Contract dated
   August 12, 1947 (excluding the Beaver
   Creek Gas Processing Plant interests
   described below)

----------------------------------------------------------------
----------------------------------------------------------------
    Beaver Creek Gas Processing Plant as          $    5,400,000
   more particularly described in that
   certain Construction and Operating
   Agreement dated March 11, 1959

----------------------------------------------------------------
----------------------------------------------------------------
    Other Interests                               $      780,000

----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
Elk Basin Unit Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Elk Basin Unit as more particularly           $   20,634,000
   described in that certain Unit Agreement
   and Unit Operating Agreement dated April
   19, 1946, and that certain Unit Agreement
   and Unit Operating Agreement (Frontier)
   dated August 20, 1954 (excluding surface
   and royalty interest associated with the
   Amoco Lease Nos. 900182-A, 900183-A,
   900184-A and 900185-A
    described below)

----------------------------------------------------------------
----------------------------------------------------------------
    Amoco Lease Nos. 900182-A, 900183-A,          $    4,100,000
   900184-A and 900185-A

----------------------------------------------------------------
----------------------------------------------------------------
    Other Interests                               $    1,000,000
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------

----------------------------------------------------------------
Salt Creek Unit Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Salt Creek Unit as more particularly          $   45,582,000
   described in that certain Unit Agreement
   dated January 10, 1939 and Unit Operating
   Agreement dated August 18, 1939
   (excluding Leasehold Interest located in
   Section 6: SE1/4SE1/4, T39N-R78W
   described below)

----------------------------------------------------------------
----------------------------------------------------------------
    Leasehold Interest located in Section         $      400,000
   6: SE1/4SE1/4, T39N-R78W

----------------------------------------------------------------
----------------------------------------------------------------
    Other Interests                               $      100,000
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
Grass Creek Unit Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Grass Creek Unit as more particularly         $    8,301,000
   described in that certain Unit Agreement
   and Unit Operating Agreement (Phosphoria
   Tensleep) dated April 1, 1974

----------------------------------------------------------------
----------------------------------------------------------------
    Other Interests                               $      100,000
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
Pitchfork Unit Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Pitchfork Unit as more particularly           $    6,619,000
   described in that certain Unit Operating
   Agreement dated December 23, 1970

----------------------------------------------------------------
----------------------------------------------------------------
    Four Bear Pipeline located in Park            $      348,000
   County, Wyoming

----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------

----------------------------------------------------------------
Medicine Pole Hills Unit Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Medicine Pole Hills Unit as more              $    3,846,000
   particularly described in that certain
   Unit Agreement and Unit Operating
   Agreement dated August 1, 1985

----------------------------------------------------------------
----------------------------------------------------------------
    Other Interests                               $      100,000
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
Red Wing Creek Unit Area Properties
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Red Wing Creek Unit as more particularly      $      946,000
   described in that certain Plan of
   Unitization Agreement dated June 10, 1981

----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
BIG SAND DRAW UNIT AREA PROPERTIES
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Big Sand Draw Unit as more particularly   
   described in that certain Cooperative or       $   16,057,000
   Unit Plan of Development dated December
   7, 1931

----------------------------------------------------------------
----------------------------------------------------------------
    Other Interests                               $      100,000
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
MISCELLANEOUS PROPERTIES
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
    Miscellaneous Gas Properties                  $      986,000
----------------------------------------------------------------
----------------------------------------------------------------
    Miscellaneous Oil Properties                  $       18,000
----------------------------------------------------------------
----------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
Total Allocated Value                             $  302,485,000
----------------------------------------------------------------




                                  EXHIBIT "C"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer



                              MATERIAL CONTRACTS

                             SEE ATTACHED DOCUMENT
                                 TWELVE PAGES


                              MATERIAL CONTRACTS


---------------------------------------------------------------------------
   AREA    DOCUMENT*                                                Cont.
                                                                    No.
---------------------------------------------------------------------------
---------------------------------------------------------------------------
1 Elk      Agreement  for  Processing  Gas Produced  from Madison 12,100
  Basin    Participating  Area in Elk Basin  Plant,  Park County,
           Wyoming and Carbon County, Montana, dated 3-26-51
---------------------------------------------------------------------------
---------------------------------------------------------------------------
2 Elk     Gas  Processing  Agreement  between APC as Producer and 122,303
  Basin    APC as Plant Operator,  Elk Basin Gasoline Plant, Park
           County, Wyoming, dated 9-1-88
---------------------------------------------------------------------------
---------------------------------------------------------------------------
3 Elk     Gas  Sales  &  Purchase   Contract  (South  Elk  Basin) 90,971
  Basin    between  Continental  Oil Company,  as  Operator,  and
           APC, as Buyer, dated 11-3-75
---------------------------------------------------------------------------
---------------------------------------------------------------------------
4 Elk     Gas  Sales  &  Purchase  Contract  between  Texaco,  as 108,299
  Basin    Seller,   and  APC,  as  Operator  of  the  Elk  Basin
           Unit-Embar Tensleep Area, dated 4-29-82
---------------------------------------------------------------------------
---------------------------------------------------------------------------
5 Elk      Contract for Operations  between  Colorado  Interstate 146,766
  Basin    Gas  Company and APC, as operator of the Elk Basin Gas
           Plant, dated 8-1-91
---------------------------------------------------------------------------
---------------------------------------------------------------------------
6 Elk      Processing  Agreement  between  Jim  Capshaw  and APC, 159,379
  Basin    dated 1-30-97
---------------------------------------------------------------------------
---------------------------------------------------------------------------
7 Elk      Purchase  Agreement  between  Jim  Capshaw and APC for 159,380
  Basin    Finished Products, dated 1-30-97
---------------------------------------------------------------------------
---------------------------------------------------------------------------
8 Elk      Assignment  between  Stanolind Oil and Gas Company and 17,221
  Basin    Billings  Gas  Company,   dated  12-21-49;   Agreement
           between  Montana-Dakota  Utilities Company,  Stanolind
           Oil and Gas  Company and The Ohio Oil  Company,  dated
           7-9-51;    Modification   Agreement   between   Amoco,
           Wiliston  Basin   Interestate   Pipeline  Company  and
           Conoco, effective 1-1-96
---------------------------------------------------------------------------
---------------------------------------------------------------------------
9 Salt     Salt  Creek  Unit Area  Agreement  and Unit  Operating 5,972-B
  Creek    Agreement, Natrona County, Wyoming, dated 1-10-39
---------------------------------------------------------------------------
---------------------------------------------------------------------------
10 Salt    Border  Agreement  between Midwest,  as Operator,  and 5792-B
   Creek   Trigood, dated 4-1-62
---------------------------------------------------------------------------
---------------------------------------------------------------------------
11 Salt    Contract for  Operation  of Unit Area between  Midwest 5792-B
   Creek   Oil  Corporation,   as  Operator,   and  Pan  American
           Petroleum, dated 8-31-65
---------------------------------------------------------------------------
---------------------------------------------------------------------------
12 Salt    Cooperative  Injection  Agreement  between Midwest and 5792-B
   Creek   CRA Inc., dated 7-1-69
---------------------------------------------------------------------------
---------------------------------------------------------------------------
13 Salt    Gas  Purchase  Contract  between AETC and Northern Gas NA
   Creek   Company, dated 3-7-94
---------------------------------------------------------------------------
---------------------------------------------------------------------------
14 Salt    Gas Marketing Agreement between Amoco and Exxon,       159,293
   Creek   dated 3-17-97
---------------------------------------------------------------------------
---------------------------------------------------------------------------
15 Beaver  Agreement  for  Construction  and  Operation of Beaver 44,201
   Creek   Creek   Processing   Plant   between   Pan   American,
           Kerr-McGee and Phillips Petroleum, dated 3-11-59
---------------------------------------------------------------------------
---------------------------------------------------------------------------
16 Beaver  Cooperative   Development   Contract,   Beaver   Creek 5,792
   Creek   Structure, Fremont County, Wyoming, dated 3-29-37

---------------------------------------------------------------------------
---------------------------------------------------------------------------
17 Beaver  Agreement  between  Phillips and Kerr-McGee  regarding 5,792
   Creek   Beaver Creek Structure,  Stanolind as Operator,  dated
           2-6-57
---------------------------------------------------------------------------
---------------------------------------------------------------------------
18 Beaver  Operating    Agreement   to   Accompany    Cooperative 5,792
   Creek   Development Contract, dated 8-12-47
---------------------------------------------------------------------------
---------------------------------------------------------------------------
19 Red     Plan of  Unitization,  Red Wing Creek  Unit,  McKenzie 81,644
   Wing    County, North Dakota, dated 6-10-81
   Creek
---------------------------------------------------------------------------
---------------------------------------------------------------------------
20 Medicine Unit  Agreement,  Medicine Pole Hills,  Red River Unit 114,451
   Pole     Area, Bowman County, North Dakota, dated 4-22-85
   Hills
---------------------------------------------------------------------------
---------------------------------------------------------------------------
21 Medicine Unit  Operating  Agreement,  Medicine Pole Hills,  Red 114,451
   Pole     River Unit Area,  Bowman County,  North Dakota,  dated
   Hills    8-1-85
---------------------------------------------------------------------------
---------------------------------------------------------------------------
22 Grass    Unit Agreement,  Grass Creek Field Phosphoria-Tensleep 269,124
   Creek    Unit Area, Hot Springs County, Wyoming, dated 4-1-74   269,126

---------------------------------------------------------------------------
---------------------------------------------------------------------------
23 Grass    Unit   Operating   Agreement,    Grass   Creek   Field 90,102
   Creek    Phosphoria-Tensleep  Unit Area,  Hot  Springs  County,
            Wyoming, dated 4-1-74
---------------------------------------------------------------------------
---------------------------------------------------------------------------
24 Grass    Unit  Agreement for the  Development  and Operating of 34,150
   Creek    the Frontier Formation,  Hot Springs County,  Wyoming,
            dated 3-12-56

---------------------------------------------------------------------------
---------------------------------------------------------------------------
25 Grass    Unit  Operating  Agreement  for  the  Development  and 34,150
   Creek    Operation  of  the  Frontier  Formation,  Hot  Springs
            County, Wyoming, dated 3-29-56
---------------------------------------------------------------------------
---------------------------------------------------------------------------
26 Grass    Unit  Agreement for  Development  and Operating of the 38,638
   Creek    Grass  Creek   Pre-Tensleep  Unit  Area,  Hot  Springs
            County, Wyoming, dated 8-22-57
---------------------------------------------------------------------------
---------------------------------------------------------------------------
27 Grass    Unit   Operating    Agreement    under   Grass   Creek 38,638
   Creek    Pre-Tensleep  Unit  Agreement,   Hot  Springs  County,
            Wyoming, dated 8-22-57
---------------------------------------------------------------------------
---------------------------------------------------------------------------
28 Grass    Unit Agreement for  Development and Operation of Grass 44,530
   Creek    Creek Curtis Unit Area, Hot Springs County,  WY, dated
            11-20-58
---------------------------------------------------------------------------
---------------------------------------------------------------------------
29 Grass    Unit   Operating   Agreement   for   Development   and 44,530
   Creek    Operation  of  Grass  Creek  Curtis  Unit  Area,   Hot
            Springs County, Wyoming, dated 11-20-58
---------------------------------------------------------------------------
---------------------------------------------------------------------------
30 Pitchfork Unit  Development    Contract   between    California 49,492
             Exploration  and  Producers  &  Refiners  Corporation,
             dated 1-1-32
---------------------------------------------------------------------------
---------------------------------------------------------------------------
31 Big       Cooperative   Development   Contract,   Beaver   Creek 5,792
   Sand      Structure,
   Draw      dated 3-29-37
---------------------------------------------------------------------------
---------------------------------------------------------------------------
32 Big       Unit Agreement, dated 12-7-31                          89,705
   Sand                                                            615,450
   Draw
---------------------------------------------------------------------------
---------------------------------------------------------------------------
33 Elk      Elk Basin Unit  Agreement,  Park  County,  Wyoming and 102,803
   Basin    Carbon County, Montana, dated 4-19-46
---------------------------------------------------------------------------
---------------------------------------------------------------------------
34 Elk      Operating  Contract  under Elk Basin  Unit  Agreement, 12,100
   Basin    Park  County,  Wyoming  and  Carbon  County,  Montana,
            dated  4-19-46
---------------------------------------------------------------------------
---------------------------------------------------------------------------
35 Elk      Unit  Agreement,  Elk  Basin  (Frontier)  Unit,  dated 22,775
   Basin    8-20-54
---------------------------------------------------------------------------
---------------------------------------------------------------------------
36 Elk      Unit Operating  Agreement,  Elk Basin (Frontier) Unit, 22,775
   Basin    dated 8-20-54
---------------------------------------------------------------------------
---------------------------------------------------------------------------
37 Elk     Contract  for  Partial  Requirements  Electric  Service NA
   Basin   between Pacific Power & Light and APC, dated 1-17-94
---------------------------------------------------------------------------
---------------------------------------------------------------------------
38 Beaver  Casinghead  Gas Supply  Contract  between Pan American, 44,202
   Creek   Kerr-McGee and Phillips, dated 3-11-59
---------------------------------------------------------------------------
---------------------------------------------------------------------------
39 Beaver  Natural Gas Supply Contract between Pan American,  Kerr 57,546
   Creek   McGee and Phillips, dated 6-1-64
---------------------------------------------------------------------------
---------------------------------------------------------------------------
40 Beaver  Gas Purchase Agreement between K N Marketing and AETC,  157,934
   Creek   dated 5-1-96
---------------------------------------------------------------------------
---------------------------------------------------------------------------
41 Beaver  Natural Gas Supply  Contract  between  Kerr-McGee,  Pan 44,203
   Creek   American and Phillips, dated 3-11-59
---------------------------------------------------------------------------
---------------------------------------------------------------------------
42 Beaver  Sulfur Sale  Agreement  between  Amoco and  Tessenderlo NA
   Creek   Kerley, dated 12-1-96
---------------------------------------------------------------------------
---------------------------------------------------------------------------
43 Elk     Sulfur Loading  Agreement between Amoco and Tessenderlo 87,706
   Basin   Kerley, dated 12-1-96
---------------------------------------------------------------------------
---------------------------------------------------------------------------
44 Salt    Office  Space  Lease   between   Amoco  and   Petrolite NA
   Creek   Corporation, dated 6-1-93
---------------------------------------------------------------------------
---------------------------------------------------------------------------
45 Pitch   Construction   and   Operating    Agreement    Fourbear NA
   Fork    Pipeline, Park County, Wyoming, dated 6-15-59
---------------------------------------------------------------------------

* All references to contracts include any and all applicable amendments.




                                  EXHIBIT "D"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                                GAS IMBALANCES

                             SEE ATTACHED DOCUMENT
                                  THREE PAGES

                                  EXHIBIT "E"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                                 PARTNERSHIPS


1.  Tax Partnership included in that certain Joint Operating Agreement dated
the 27th day of August, 1985 covering the NW/4 of Section 15, Township 30
North, Range 45 East, Valley County, Montana.




                                  EXHIBIT "F"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer



                       EXCLUDED PROPERTIES - AFFILIATES

Amoco Pipeline Company Station Sites:

1.    Elk Basin Station (Sec. 8, T58N, R100W, Park County, Wyoming)

      -    The Elk Basin  Station is an  unmanned  station on the Elk Basin leg
           of the Lost Cabin Crude Gathering  System that is owned and operated
           by Amoco  Pipeline  Company  ("APL").  It  receives  crude  oil from
           APL's  12-inch line from  Billings and delivers  crude via an 8-inch
           line to the Silver Tip  Station.  Its  primary  receipt of oil comes
           from APL's  facilities  located at Oregon  Station via APL's 12-inch
           mainline and  Marathon  Pipeline at Elk Basin.  Elk Basin  Station's
           primary  function is to deliver "Y" crude to the Silver Tip Station,
           an APL metering facility, then to Exxon Pipeline's tank farm.

      -    Elk  Basin  Station  Equipment.   The  Elk  Basin  Station  includes
           pipelines,  tanks, meters,  measurement  facilities,  pumps, valves,
           scraper  traps,  fittings,   connections  and  other  appurtenances,
           including without limitation, the following:

           a.   Pumping  Unit.  There is one  pumping  unit.  Unit #1 is a Gaso
                2652 positive  displacement  pump with a 250 HP Allis  Chalmers
                electric motor.

           b.   Booster  Pump.  There  is one  booster  pump.  Booster  #1 is a
                Johnson  4-stage  vertical   centrifugal  pump  with  a  30  HP
                Continental electric motor.

           c.   Control  Valve.  There is an ANSI 600 4-inch  Fisher  valve and
                actuator  that is in the pump  bypass  for  startup  and closes
                when the pump gets onstream.

           d.   Back  Pressure  Control  Valve.  There  is an ANSI  600  4-inch
                Fisher  valve and  actuator  that is used to  control  the hill
                pressure and line fill from the Oregon Station.

           e.   Relief  Valve.  There  is an  ANSI  600  relief  valve  in  the
                incoming trap from the Oregon  Station to protect the line from
                the Oregon  Station to Elk  Basin,  and is set to relieve  into
                tankage at 640 psi.

           f.   Tankage.  There are two 54,000 bbl tanks (Nos. 6727 and 6728).

           g.   LACT. Elk Basin LACT located on the Elk Basin Station grounds.
 

2.    Edgerton Station (Sec. 10, T40N, R78W Natrona County, Wyoming)

      -    The Edgerton  Station is an unmanned  origin station on the Edgerton
           leg of the Salt  Creek  Crude  Gathering  System  that is owned  and
           operated  by APL.  It  receives  "U" or  "Sweet"  crude  from  Belle
           Fourche  Pipeline Company ("Belle  Fourche")  through their tank and
           Automatic Custody Transfer ("ACT") unit.

      -    Edgerton   Station   Equipment.   The  Egderton   Station   includes
           pipelines,  tanks, meters,  measurement  facilities,  pumps, valves,
           scraper  traps,  fittings,   connections  and  other  appurtenances,
           including without limitation, the following:

           a.   Pumping  Units.  There  are  two  pumping  units.  Unit #1 is a
                Byron Jackson  nine-stage VLT vertical  centrifugal pump with a
                50 HP Siemens electric motor.

           b.   Manually  Operated  Block  Valves.   There  are  five  manually
                operated  block  valves;  one on either  side of the two units,
                and one in a bypass  between  the two  units.  All  valves  are
                ANSI 300 6-inch  valves,  except for the valve upstream of Unit
                #2 which is an ANSI 150 6-inch valve.

           c.   Check Valve.  There are two ANSI 300 6-inch check  valves.  The
                check valve for Unit #1 is  upstream  of the control  valve and
                the check  valve for Unit #2 is upstream of the block valve for
                the unit.  These  valves are placed to  eliminate  any backflow
                when the station is down and the block valves are not closed.

           d.   Control  Valve.  There is an ANSI  300  4-inch  Fisher  control
                valve  downstream  of  Unit  #1 to  automatically  control  the
                station's flow and suction and discharge pressures.

           e.   Crude  Line.  There is a 4.97 mile  6-inch  crude line from the
                Edgerton Station to Salt Creek.

           f.   Belle  Fourche  Facilities.  Belle  Fourche owns and operates a
                tank and ACT with a  meter,  BS&W  monitor,  pump,  valves  and
                piping to deliver "U" crude to APL's pump.


3.    Salt Creek Station (Sec. 24, T40N, R79W, Natrona County, Wyoming)

      -    The Salt Creek  Station is a manned  origin  station on the mainline
           to Casper of the Salt Creek  Crude  Gathering  System  that is owned
           and  operated by APL. It receives  "BW" or "Sweet"  crude from Reno,
           Sussex;  "TSP" or "Tensleep"  crude from Reno,  Sussex and the local
           East Salt Creek lines;  "U" or light "Sweet" crude from the Edgerton
           line;  "BW" crude from  local  Salt  Creek  lines;  and "Y" or heavy
           "Sour"  crude on a local  Salt  Creek  line,  and  batches it to the
           Casper tank farm.

      -    Salt  Creek  Station  Equipment.  The Salt  Creek  Station  includes
           pipelines,  tanks, meters,  measurement  facilities,  pumps, valves,
           scraper  traps,  fittings,   connections  and  other  appurtenances,
           including without limitation, the following:

           a.   Pumping  Units.  There are three  pumping  units.  Units #1 and
                #2 are Byron Jackson  5-stage  centrifugal  pumps with Electric
                Motive 500 HP  electric  motors.  Unit #3 is a Bingham  3-stage
                centrifugal pump with a Louis Allis 2,000 HP electric motor.

           b.   Booster  Pump.  There  is one  booster  pump.  Booster  #1 is a
                Johnson   5-stage   (de-staged   to   2)   vertical   deep-well
                centrifugal pump with a 150 HP General Electric motor.

           c.   Control  Valves.  There are two ANSI 600 8-inch Fisher  control
                valves.  One is  downstream of Units #1 and #2 and the other is
                downstream  of Unit #3 to control  the  station's  suction  and
                discharge  pressures.  Unit #3 does not  operate  with Units #1
                and #2 and has a separate discharge line.

           d.   Motor-Operated  Block Valves.  There are seven ANSI 150 12-inch
                and two ANSI 150  8-inch  motor-operated  valves  (Units #1 and
                #2),  six of which are in the suction  line from the tanks used
                to  supply  crude  to  the  mainline  units.  Three  are in the
                suction lines to the pumps and adjacent to them.

           e.   Manually  Operated  Block Valves.  There are three key manually
                operated  block  valves.  Two are ANSI 150 8-inch  valves  that
                isolate  Units #1, #2 or #3 from the  incoming  crude line when
                one or the other is  running.  The other is an ANSI 600 12-inch
                valve in the  mainline  downstream  of the units to isolate the
                station from the line.

           f.   Check  Valve.   There  is  an  ANSI  600  16-inch  check  valve
                upstream of the mainline  valve to eliminate  backflow when the
                station is down and the block value is not closed.

           g.   Relief  Valves.  There are two  relief  valves on the  incoming
                gathering  lines  from  Reno and North  Fork at the Salt  Creek
                scraper trap.  The valves relieve into Tank No. 47840.

           h.   Meters.  There are two ANSI 150  positive  displacement  meters
                for  measuring  the flow from the Salt Creek Station to Casper.
                One meter is 8-inch and the other is 10-inch.

           i.   Gravitometers.  There  are  three  gravitometers  at  the  Salt
                Creek  Station to measure  the  gravity of the  incoming  crude
                from Reno and the outgoing  batches to Casper.  Gravity is used
                in the Programmable  Logic Controller to switch the "B" and "T"
                crudes to the  appropriate  tanks via the Salt Creek  manifold.
                The  third  gravitometer  is on the East  Salt  Creek  Line and
                switches automatically from "P" to TSP crudes.

           j.   Two-Way  Valves.  There are two ANSI 300 8-inch  two-way valves
                on the  incoming  lines from Reno and East Salt Creek to direct
                the different crudes to the proper tanks.

           k.   Programmable  Logic Controller.  A GE 6000  Programmable  Logic
                Controller  is used to  sequence  the units  onstream  and shut
                them  down,  divert  "B" and "T" crude  from Reno and East Salt
                Creek to the appropriate  tanks,  and act as the  communication
                device  instead of the  AMOCAMS 300 and  generally  monitor the
                station.

           l.   Tankage.  Salt Creek  Station has six tanks (Nos.  6635,  6636,
                47840, 48213, 42617 and 6682).

           m.   ACT.  Salt Creek Truck ACT,  includes  tank Nos.  7072 and 7065
                located on the Salt Creek Station grounds.

           n.   Gathering  Pipelines.  Gathering pipelines  associated with the
                Salt Creek Station site include:

                -    From LACT 5 (Sec. 14, T40N R78W)
                -    From LACT 10 (Sec. 30, T40N R78W)
                -    From LACT 20 (Sec. 26 ,T40N R78W)
                -    From LACT 4 (Sec. 11, T40N R79W)
                -    From LACT 11 (Sec. 35, T40N R79W)
                -    South Gravity Line (Sec. 24, 25, 36, T40N R79W)
                -    South Gravity Line (Sec. 13, 12, 1, T39N R78W)

Line Segments

APL owned and  operated  Salt  Creek  Crude  Gathering  System  which  includes
pipelines,  tanks,  meters,  measurement  facilities,  pumps,  valves,  scraper
traps,  fittings,  connections  and  other  appurtenances,   including  without
limitation, the following:

1.    Salt Creek/Casper Mainline

      -    23.13  mi of  16-inch  pipe  and  17.82  mi  of  12-inch  pipe  that
           originates  at the Salt Creek  Station  and runs south  parallel  to
           I-25/US Highway 87 to the Casper Station.

2.    Reno/Salt Creek Gathering Line

      -    31.87 mi of 10-inch  pipe  originating  at the Reno Station and runs
           to the Salt Creek Station and parallels  I-25/US Highway 87 (5-10 mi
           East).

3.    North Fork/Salt Creek Gathering Line

      -    29.59 mi of 12-inch pipe  originating at North Fork Station and runs
           SE parallel and close to I-25/US Highway 87.

4.    Edgerton/Salt Creek Gathering Line

      -    4.97 mi of 6-inch pipe  originating at Edgerton  Station and runs SW
           parallel to State Hwy 387 to the Salt Creek Station.

5.    Billings to Casper Trunk Line

      -    Originating in Billings, through Elk Basin to Casper.

6.    Elk Basin to Silvertip

      -    7.23 mi of 8-inch  pipe  originating  at Elk  Basin  and runs  north
           through Elk Basin field along Silvertip Creek.



Downstream Facilities

Any and all assets  downstream  of the  LACTS,  including  without  limitation,
pipelines,  tanks,  meters,  measurement  facilities,  pumps,  valves,  scraper
traps, fittings, connections and other appurtenances.

                                 EXHIBIT "F-1"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                          EXCLUDED PROPERTIES - OTHER

                             SEE ATTACHED DOCUMENT
                                   TWO PAGES

                                  EXHIBIT "G"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                        CLAIMS, DISPUTES AND LITIGATION

     The following is a summary of the  currently  identified  pending  claims,
disputes and litigation associated with the Properties:
 
      1.   Robert A. James and Sharon V. James vs. Oil Field Safety,  Inc., and
      Amoco  Production  Company,  in the 9th District Court,  Freemont County,
      Wyoming,  Case  No.  CV28909.  The  Plaintiff  alleges  he  is  suffering
      health problems due to H2S exposure at the Beaver Creek 116 Well.

      2.   Donald  Swanton and Lori  Swanton vs. V-1 Oil  Company,  et. al., in
      the United  States  District  Court for the  District of  Montana,  Great
      Falls Division, Case No.  CV-95-105-GF-PGH.  The Plaintiff alleges he was
      injured as a result of inadequate  odorant  contained in liquid  products
      he purchased.

      3.   Wilford M. Burton, et. al., vs. Amoco Production  Company,  et. al.,
      in the Third Judicial  District Court,  Salt Lake County,  Utah, Case No.
      96-09017-95CV.  This is an oil royalties  dispute.  The  Plaintiffs  seek
      certification of a nationwide class.

      4.   M. Lovelace Jr., et. al., vs. Amerada Hess Corporation,  et. al., in
      the Circuit Court of Estambia County,  Alabama,  Case No. CV-96-297.  The
      Plaintiffs  allege violation of anti-trust laws of the various  producing
      states by conspiring to artificially  depress the "posted price" on which
      royalties are paid. The  Plaintiffs  seek  certification  of a nationwide
      class.

      5.   The McMahon Foundation,  et. al., vs. Amerada Hess Corporation,  et.
      al., in the United States  District  Court,  Southern  District of Texas,
      Houston  Division,  Case No.  H-96-1155.  The Plaintiffs allege violation
      of federal  anti-trust  laws by  conspiring to  artificially  depress the
      "posted  price"  on  which   royalties  are  paid.  The  Plaintiffs  seek
      certification of a nationwide class.
 
       6.  MMS Issues.  Amoco and the MMS are  involved in ongoing  discussions
      concerning the alleged  underpayment of royalties on a nationwide  basis.
      See Schedule 1 (Summary of Outstanding MMS Issues) attached hereto.


      7.   Cameron Parish School Board, et al. v. Texaco,  Inc., et al., in the
      United  States  District  Court,  Western  District  of  Louisiana,  Lake
      Charles  Division,  Civil Action No. CV 96-1222.  The  Plaintiffs  allege
      defendants  have  violated  federal  anti-trust  laws  by  conspiring  to
      artificially  depress the  "posted  price" on which  royalties  are paid,
      fraudulently  concealing  price-fixing activities and in turn underpaying
      plaintiffs  for  crude  oil.  The  Plaintiffs  seek  certification  of  a
      nationwide class with respect to the anti-trust claims.

      8.   James Donald  Stanley,  et al. v. Gulf Oil  Corporation,  et al., in
      the  United  States   District   Court  for  the  Southern   District  of
      Mississippi,   Hattiesburg,   Division,  Civil  Action  No.  2:97CV279PG.
      Plaintiffs  allege that defendants have violated federal  antitrust laws,
      have set their posted prices at levels  consistently  below a fair market
      price  and that  their  royalty  payments  have been too low as a result.
      Plaintiffs sue to recover this  underpayment and seek  certification of a
      nationwide class.

      9.  Randolph  Energy,  Inc. v. Amerada  Hess Corp.  et al., in the United
      States  District  Court,  for  the  Southern   District  of  Mississippi,
      Hattiesburg  Division,  Civil Action No.  2:97CV273PG.  Plaintiffs allege
      conspiracy among the Defendant oil companies to fix,  depress,  stabilize
      and  maintain  at  artificially  low levels the prices paid for the first
      purchase of crude oil sold from leases in which  Plaintiffs own interests
      by using posted  prices in a sham manner in order to keep them in a range
      below competitive  market prices.  The Plaintiffs seek certification of a
      nationwide class.

      10.  Department of Justice  Investigation  The  Department of Justice and
      the Office of the  Inspector  General of the  Department  of the Interior
      are  conducting an  investigation  of whether Amoco and other oil and gas
      producers have violated the False Claims Act, 31 U.S.C.  Section 3729 et.
      seq.,  in  connection   with  alleged   underpayment   of  royalties  for
      extraction of oil or gas on federal or indian lands.

Seller is currently  conducting a review to  determine  if  additional  claims,
disputes and  litigation  are pending.  If Seller  determines  prior to Closing
that  additional   matters  are  pending,   the  above   information   will  be
supplemented.  Additional  information in Seller's  possession  associated with
the above referenced matters will prior to Closing be provided upon request.


                                  EXHIBIT "H"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                          ASSIGNMENT AND BILL OF SALE


STATE OF [Insert State]      Section  
                          
COUNTY OF [Insert County] Section


     This  ASSIGNMENT  AND BILL OF SALE  ("Assignment")  dated the [Insert Day]
day of [Insert  Month],  1997,  but  effective  as of the 1st day of  December,
1997  ("Effective   Time"),  is  from  Amoco  Production  Company,  a  Delaware
corporation,  with an office at 501 WestLake  Park  Boulevard,  Houston,  Texas
77079  (hereinafter  referred to as  "Assignor")  to [Insert  Company  Name], a
[Insert  State  of  Incorporation]  corporation,  with  an  office  at  [Insert
Address] (hereinafter referred to as "Assignee").

     FOR Ten Dollars  and other good and  valuable  consideration,  the receipt
and  sufficiency  of which are hereby  acknowledged,  Assignor  hereby  GRANTS,
CONVEYS,  SELLS  and  ASSIGNS  to  Assignee  the  following  properties  (real,
personal or mixed) and rights (contractual or otherwise):

     [DEFINITION  OF  PROPERTIES  AND  EXCLUDED  ASSETS - TO BE  INSERTED  FROM
ARTICLE 1.44]

All of the properties  (real,  personal and mixed) and rights  (contractual  or
otherwise) described are referred to as "Properties".

     TO HAVE AND TO HOLD the  Properties  subject  to the  following  terms and
conditions:

     1.   Special  Warranty  Of  Title.  Seller  shall  warrant  title  to  and
forever defend title to the  Properties  conveyed to Buyer against every person
whomsoever  lawfully  claiming  title to the  Properties,  or any part  thereof
by,  through or under Seller, but not otherwise.

     2.   Agreements.   This  Assignment  is  made  subject  to  and  shall  be
burdened by the terms,  covenants and  conditions  contained in any  contracts,
agreements  and  instruments  affecting  the  Properties;  and at and after the
Effective  Time,   Assignee  expressly  agrees  to  be  bound  by,  assume  the
obligations  arising under,  and shall perform all of the terms,  covenants and
conditions contained therein.

     3.   Compliance  With  Laws:  This  Assignment  is  made  subject  to  all
applicable laws, statutes,  ordinances,  permits,  decrees, orders,  judgments,
rules  and  regulations   which  are  promulgated,   issued  or  enacted  by  a
governmental  entity or tribal authority having appropriate  jurisdiction,  and
Assignee shall comply with the same at and after the Effective Time.

     4.   Successors   and  Assigns.   The  terms,   covenants  and  conditions
contained  in this  Assignment  shall be binding  upon and inure to the benefit
of the parties hereto and their  respective  successors  and assigns,  and such
terms,  covenants and conditions  shall be covenants  running with the land and
with each  subsequent  transfer or  assignment of the  Properties,  or any part
thereof.

     5.   Purchase and Sale  Agreement.  This  Assignment  (a copy of which can
be  obtained  from  Assignee  at the  above  referenced  address)  is  made  in
accordance  with  and  is  subject  to  the  terms,  covenants  and  conditions
contained in that certain  PURCHASE AND SALE  AGREEMENT  dated the [Insert Day]
day of [Insert  Month],  1997,  by and  between  Amoco  Production  Company and
[Insert  Company  Name]  ("Purchase  and  Sale  Agreement"),   and  the  terms,
covenants  and  conditions  contained in the Purchase  and Sale  Agreement  are
incorporated   herein  by  reference  as  though  said  terms,   covenants  and
conditions  were  fully  set  forth  verbatim  herein.  If there is a  conflict
between  the   provisions   of  the  Purchase  and  Sale   Agreement  and  this
Assignment,  the  provisions of the Purchase and Sale  Agreement  shall control
the rights and  obligations  of the parties,  and their  authorized  successors
and assigns.

     EXECUTED on the day and year first  referenced  above, but effective as of
the Effective Time.

                               Assignor
                               AMOCO PRODUCTION COMPANY

                              By:   __________________________
                              Name: __________________________
                              Title:Attorney-in-Fact


                              Assignee
                              [Insert Company Name]

                              By:   __________________________
                              Name: __________________________
                              Title:Attorney-in-Fact




STATE OF TEXAS     Section
                   
COUNTY OF HARRIS   Section

     The foregoing  instrument was  acknowledged  before me this _______ day of
___________________,  199__, by  ________________________,  Attorney-in-Fact on
behalf of __________________________ a _______________ corporation.


My commission expires:
_________________________________


                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of Texas



STATE OF TEXAS    Section 
                   
COUNTY OF HARRIS   Section

     The foregoing  instrument was  acknowledged  before me this _______ day of
_______________,  199__,  by  ________________________,  ________  on behalf of
__________________________ a _______________ corporation.


My commission expires:
_________________________________



                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of Texas




                                  EXHIBIT "I"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                        Howell Petroleum Corporation, Buyer


                                 SURFACE DEED

 STATE OF [Insert State]       Section
                          
COUNTY OF [Insert County] Section

      AMOCO PRODUCTION COMPANY, a Delaware corporation,  with an address at 501
WestLake Park  Boulevard,  Houston,  Texas 77079  ("Grantor"),  for ten dollars
($10.00)   and  other  good  and  valuable   consideration,   the  receipt  and
sufficiency  of which are hereby  acknowledged,  does  hereby  grant,  sell and
convey with special warranty of title unto     [Insert  Company Name],  with an
office at  [Insert  Address]  ("Grantee"),  the  SURFACE  ESTATE  ONLY of those
certain  tracts of land situated in [Insert  County]  County,  [Insert  State],
being  more  specifically   described  in  Exhibit  "A",  attached  hereto  and
incorporated  herein  by  reference  (collectively  referred  to herein as "the
Property").

      TO HAVE AND TO HOLD the Property  together with all rights and privileges
thereto appertaining, unto Grantee, its successors and assigns.

     Grantor shall warrant title to and forever  defend title to the Properties
conveyed to Grantee  against every person  whomsoever  lawfully  claiming title
to the  Properties,  or any part thereof by, through or under Grantor,  but not
otherwise.

      The  terms,  covenants  and  conditions  contained  in this Deed shall be
binding  upon and inure to the  benefit  of the  parties  and their  respective
successors  and assigns,  and such terms,  covenants  and  conditions  shall be
covenants  running  with  the  land  and  with  each  subsequent   transfer  or
assignment of the Property, or any part thereof.

      This Deed is made in accordance  with and subject to any and all oil, gas
and   mineral   leases;   and  all   restrictions,   reservations,   covenants,
conditions,  agreements,  rights-of-way  and  easements  of record  in  [Insert
County] County,  [Insert  State],  and/or  disclosed to Grantee,  affecting the
Property,  or any  part  thereof,  and  the  terms,  covenants  and  conditions
contained in that certain  Purchase and Sale  Agreement (a copy of which can be
obtained from Grantee at the above  referenced  address) dated the [Insert Day]
day of [Insert  Month],  1997,  by and between  Grantor and Grantee  ("Purchase
and Sale  Agreement").  The terms,  covenants and  conditions  contained in the
Purchase  and Sale  Agreement  are  incorporated  herein by reference as though
said terms,  covenants and  conditions  were fully set forth  herein.  If there
is a conflict  between the  provisions  of the Purchase and Sale  Agreement and
this Deed,  the  provisions  of the Purchase and Sale  Agreement  shall control
the rights and obligations of the parties.

      EXECUTED  this [Insert Day] day of [Insert  Month],  1997,  but effective
the 1st day of December, 1997.

AMOCO PRODUCTION COMPANY         [Insert Company Name]


By:                                  By:                                
Name:                            Name:                             
Title:  Attorney-in-Fact                      Title:  Attorney-in-Fact


STATE OF TEXAS             Section    
                               
COUNTY OF HARRIS           Section    

     The foregoing  instrument was  acknowledged  before me this _______ day of
___________________,  1997, by  ________________________,  Attorney-in-Fact  on
behalf of __________________________________, a  ____________ corporation.


My commission expires:
_________________________________


                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of Texas



STATE OF TEXAS                 Section
                               
COUNTY OF HARRIS               Section

     The foregoing  instrument was  acknowledged  before me this _______ day of
_______________,  1997, by  ________________________,  ___________ on behalf of
__________________________________, a  ____________ corporation.


My commission expires:
_________________________________


                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of _______________

                   



                                   EXHIBIT "J"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                                 MINERAL DEED

 STATE OF [Insert State]       Section

COUNTY OF [Insert County] Section

      AMOCO PRODUCTION COMPANY, a Delaware corporation,  with an address at 501
WestLake Park  Boulevard,  Houston,  Texas 77079  ("Grantor"),  for ten dollars
($10.00)   and  other  good  and  valuable   consideration,   the  receipt  and
sufficiency  of which are hereby  acknowledged,  does  hereby  grant,  sell and
convey with  special  warranty of title unto  [Insert  Company  Name],  with an
office at [Insert  Address]  ("Grantee"),  the MINERAL  ESTATE ONLY  associated
with  those  certain  tracts  of land  situated  in  [Insert  County],  County,
[Insert  State],  being more  specifically  described in Exhibit "A",  attached
hereto and incorporated  herein by reference  (collectively  referred to herein
as "the Mineral Interest").

      TO HAVE AND TO HOLD the  Mineral  Interest  together  with all rights and
privileges thereto appertaining, unto Grantee, its successors and assigns.

     Grantor shall warrant title to and forever  defend title to the Properties
conveyed to Grantee  against every person  whomsoever  lawfully  claiming title
to the  Properties,  or any part thereof by, through or under Grantor,  but not
otherwise.

      The terms,  covenants and conditions contained in this Mineral Deed shall
be binding  upon and inure to the benefit of the  parties and their  respective
successors  and assigns,  and such terms,  covenants  and  conditions  shall be
covenants  running  with  the  land  and  with  each  subsequent   transfer  or
assignment of the Mineral Interest, or any part thereof.

      This Mineral Deed is made in  accordance  with and subject to any and all
oil, gas and mineral leases;  and all  restrictions,  reservations,  covenants,
conditions,  agreements,  rights-of-way  and  easements  of record  in  [Insert
County] County,  [Insert  State],  and/or  disclosed to Grantee,  affecting the
Mineral  Interest,   or  any  part  thereof,  and  the  terms,   covenants  and
conditions  contained  in that certain  Purchase and Sale  Agreement (a copy of
which can be  obtained  from  Grantee at the above  referenced  address)  dated
the  [Insert  Day] day of [Insert  Month],  1997,  by and  between  Grantor and
Grantee  ("Purchase and Sale Agreement").  The terms,  covenants and conditions
contained  in the  Purchase  and Sale  Agreement  are  incorporated  herein  by
reference as though said terms,  covenants and conditions  were fully set forth
herein.  If there is a conflict  between the  provisions  of the  Purchase  and
Sale  Agreement and this Mineral Deed,  the provisions of the Purchase and Sale
Agreement shall control the rights and obligations of the parties.

      EXECUTED this [Insert Day],  day of [Insert  Month],  1997, but effective
the 1st day of December, 1997.

AMOCO PRODUCTION COMPANY         [Insert Company Name]


By:                              By:                                
Name:                            Name:                             
Title:  Attorney-in-Fact         Title:  Attorney-in-Fact


STATE OF TEXAS     Section            
                               
COUNTY OF HARRIS   Section             

     The foregoing  instrument was  acknowledged  before me this _______ day of
___________________,  1997, by  ________________________,  Attorney-in-Fact  on
behalf of __________________________________, a  ____________ corporation.



My commission expires:
_________________________________


                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of Texas


STATE OF TEXAS     Section            
                               
COUNTY OF HARRIS   Section            

     The foregoing  instrument was  acknowledged  before me this _______ day of
_______________,  1997, by  ________________________,  ___________ on behalf of
__________________________________, a  ____________ corporation.


My commission expires:
_________________________________


                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of _______________



                                  EXHIBIT "K"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer

                                  CERTIFICATE

      I, [Insert  Name],  [Insert  Title] of [Insert  Seller/Buyer],  a [Insert
State  of  Incorporation]  corporation  ("[Insert  Seller/Buyer]"),  do  hereby
certify pursuant to Article          of the  Purchase  and  Sale  Agreement  by
and between  Amoco  Production  Company and [Insert  Company  Name],  dated the
[Insert  Day]  day  of  [Insert  Month],  1997  (the  "Agreement"),   that  the
representations  and  warranties  contained  in  the  Agreement  are  true  and
correct  on and as of the date  hereof,  except for  inaccuracies  which in the
aggregate are not material when considering the transaction as a whole.

                               [Insert Seller/Buyer]


                               By:                            
                               Name:                          
                               Title:                        
                               Date:                         



                                  EXHIBIT "L"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer

                                LETTERS-IN-LIEU


[Insert Date]


[Insert Product Purchaser's Name]
[Insert Product Purchaser's Address]


Gentlemen:

      Enclosed  is a copy of an  unrecorded  Assignment  and Bill of Sale dated
the [Insert Day] day of [Insert  Month],  1997, from Amoco  Production  Company
("Seller") to [Insert Company Name] ("Buyer")  conveying all of Seller's right,
title  and  interests  in  and to  the  properties  described  in  Exhibit  "A"
attached hereto ("Properties").

      You are currently  disbursing  proceeds from the oil or gas produced from
the Properties  pursuant to certain division  orders,  transfer orders or other
agreements.  This  letter is provided  by Seller and Buyer as an  agreement  in
lieu of  having  separate  division  orders or  transfer  orders  prepared  and
executed for the Properties.

      PAYMENT  INSTRUCTIONS - Effective as of the next  distribution  date, and
until  further  notice,  Seller and Buyer hereby  authorize and instruct you to
pay to Buyer all amounts  which become due to the interests  formerly  owned by
Seller  for  any  products  produced  or sold  from  the  Properties.  Payments
should be made to Buyer at the following address:

                            [Insert Company's Name]
                          [Insert Company's Address]
                      [Insert Company's Telephone Number]

It is the  intent  of  Seller  and  Buyer  that  there be no  suspension  of or
interruption in payments made by you with respect to the Properties.

      INDEMNITY  - Buyer  hereby  agrees to  indemnify  you against any and all
claims,   demands,   suits,  causes  of  action,   losses,  damages  and  costs
(including  attorneys'  fees and costs of litigation)  occurring as a result of
your making payments or remittances in the manner specified herein.

      FURTHER INFORMATION - Upon request,  Buyer will furnish you a copy of the
recorded  Assignment  and  Bill  of  Sale,  when  available.  If you  have  any
questions  regarding the  Properties  or other matters set forth herein,  or if
for any  reason  you are unable to comply  with the  request  set forth in this
letter, you are requested to contact Buyer at the above-referenced address.

      In order that Buyer may have a record  evidencing your acceptance of this
letter,  we request  that you sign two (2)  copies of this  letter in the space
provided  below  and  return  one  (1)  fully  executed  copy to  Buyer  at the
above-referenced address.


BUYER                          SELLER

[Insert Company Name]          AMOCO PRODUCTION COMPANY

By:                            By:                            
Name:                          Name:                          
Title:  Attorney-in-Fact       Title:  Attorney-in-Fact



RECEIPT IS ACKNOWLEDGED THIS [Insert Day] DAY OF [Insert Month], 1997.


[Insert Product Purchaser's Name]

By:   ______________________
Name: ______________________
Title:______________________


                                  EXHIBIT "M"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                              OPINION OF COUNSEL

[Insert Date]

To:  [Insert Seller/Buyer]


Gentlemen:

This opinion is  delivered  to you  pursuant to that certain  Purchase and Sale
Agreement  by and between  Amoco  Production  Company,  a Delaware  corporation
("Seller")  and  [Insert  Company  Name],  a  [Insert  State of  Incorporation]
corporation  ("Buyer") dated the [Insert Day] day of [Insert Month],  1997 (the
"Agreement").   Capitalized   terms  not   otherwise   defined  have  the  same
meanings as set forth in the Agreement.

As  counsel  for  [Insert  Seller/Buyer],  I have made such  legal and  factual
examinations  as I have deemed  necessary  and proper in rendering the opinions
herein  expressed,  and I have examined such documents as the materials  listed
below:

(a)   The Certificate of Incorporation and Bylaws of [Insert Seller/Buyer],  as
amended;

(b)   Confirmation  from  the  applicable  Secretary  of  State  as to the good
standing  of  [Insert   Seller/Buyer],   in  the  State  of  [Insert  State  of
Incorporation];

(c)   Certified  copies of  resolutions  adopted by the Board of  Directors  of
[Insert  Seller/Buyer]  in connection  with the  Agreement and certain  related
matters; and

(d)   An executed copy of the Agreement.

Based upon the foregoing and having  regard to the legal  considerations  which
I deem relevant, it is my opinion that:

1.  [Insert  Seller/Buyer]  is a corporation  duly organized,  validly existing
   and in good  standing  under  the  Laws of the  State  of  [Insert  State of
   Incorporation],  having all requisite  corporate  power and authority to own
   and  lease  the  Properties.  [Insert  Seller/Buyer]  is  duly  licensed  or
   qualified to do business as a foreign  corporation  and is in good  standing
   in all jurisdictions in which the Properties are located;

2.  [Insert  Seller/Buyer]  has all requisite  corporate power and authority to
   execute  and  deliver  the  Agreement,   to  consummate   the   transactions
   contemplated  therein and to perform all of the terms and  conditions  to be
   performed  by it as  provided  for  in  the  Agreement.  The  execution  and
   delivery of the  Agreement  by [Insert  Seller/Buyer],  the  performance  by
   [Insert  Seller/Buyer] of all of the terms and conditions to be performed by
   it and the consummation of the transactions  contemplated  therein have been
   duly  authorized  and  approved  by  all  necessary  corporate  action.  The
   Agreement has been duly executed and delivered by [Insert  Seller/Buyer] and
   constitutes  the valid and  binding  obligation  of  [Insert  Seller/Buyer],
   enforceable  against  it in  accordance  with  its  terms,  except  as  such
   enforceability  may be  limited  by  bankruptcy,  insolvency  or other  Laws
   relating to or affecting the  enforcement  of creditors'  rights and general
   principles  of  equity   (regardless  of  whether  such   enforceability  is
   considered in a proceeding at law or in equity); and

3.  The execution and delivery of the  Agreement  and the  consummation  of the
   transaction  contemplated  therein  will not  conflict  with or require  the
   consent  of any  person or  entity  under any of the  terms,  conditions  or
   provisions  of  the  Certificate  of  Incorporation  or  Bylaws  of  [Insert
   Seller/Buyer].

In rendering  this opinion,  I have assumed the  genuineness  of all signatures
and the  authenticity  of all  documents  submitted to me as originals  and the
conformity  with  the  originals  of  all  documents  submitted  as  certified,
photostatic  or  otherwise  identified  as  copies.  I also have  obtained  and
relied upon such  certificates as to factual matters and other  assurances from
public  officials  and  officers  of  [Insert  Seller/Buyer]  as  I  considered
necessary  for the  purpose of  rendering  this  opinion.  With  respect to the
good standing of [Insert  Seller/Buyer],  I have relied solely on the advice of
the Secretary of State of [Insert State of Incorporation].

The  foregoing  opinion  is  limited  to the  laws  of  the  State  of  [Insert
Attorney's  State of  License]  and the  federal  laws of the United  States of
America,  and I express  no opinion  as to the  applicability  or the effect of
the laws of any other jurisdiction.

This  opinion is  rendered  solely for the  benefit of the entity to which this
opinion is addressed in  connection  with the  Agreement  and the  transactions
contemplated  thereby,  and may not be relied upon for any other  purpose,  nor
may it be furnished  to, used,  circulated,  quoted or referred to by any other
person or entity without my prior written consent.

                                    Sincerely,


                                                              
                                    Name:                     
                                    Counsel For:                   
                                    Date:                          


                                  EXHIBIT "N"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                             NON-FOREIGN AFFIDAVIT

                     Exemption from Withholding of Tax For
                 Dispositions of U.S. Real Property Interests


     Article 1445 of the Internal  Revenue Code provides that a transferee of a
U.S.  real property  interest must withhold tax if the  transferor is a foreign
person.  To inform [Insert Company Name]  ("Buyer") that  withholding of tax is
not required upon the  disposition  of a U.S.  real property  interest by Amoco
Production Company, the undersigned hereby certifies the following:

     1.   Amoco  Production  Company  is  not  a  nonresident  alien,   foreign
corporation,   foreign  partnership,  foreign  trust,  or  foreign  estate  for
purposes of U.S. income taxation;

     2.   Amoco   Production   Company's   taxpayer   identifying   number   is
73-0466080; and

     3.   Amoco  Production  Company's home address is 200 East Randolph Drive,
Chicago, Illinois 60601.

     Amoco  Production  Company  understands  that  this  certification  may be
disclosed  to the  Internal  Revenue  Service  by  Buyer  and  that  any  false
statement contained herein could be punished by fine, imprisonment, or both.

     Under  penalties  of  perjury,   I  declare  that  I  have  examined  this
certification  and,  to the  best  of my  knowledge  and  belief,  it is  true,
correct,  and  complete,  and I further  declare I have  authority to sign this
document.
 
AMOCO PRODUCTION COMPANY


                              By:   __________________________
                              Name:  ___________________________
                              Title: Attorney-in-Fact

STATE OF TEXAS     Section
                   
COUNTY OF HARRIS   Section

     The foregoing  instrument was  acknowledged  before me this _______ day of
___________________,  199__, by  ________________________  as Attorney-in-Fact,
on behalf of Amoco Production Company, a Delaware corporation.


My commission expires:
_________________________________


                               Signature

                               _________________________________
                               Name (Printed, Typed of Stamped)
                               Notary Public in and for the
                               State of Texas


                                  EXHIBIT "O"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                             TRANSITION AGREEMENT

      THIS  TRANSITION  AGREEMENT  ("Agreement")  is entered  into this [Insert
Day] day of  [Insert  Month],  1997,  by and  between  [Insert  Buyer],  with a
mailing address of [Insert  Address]  ("Buyer") and AMOCO  PRODUCTION  COMPANY,
with a  mailing  address  of  501  WestLake  Boulevard,  Houston,  Texas  77079
("Amoco").

      WHEREAS,  on the  [Insert  Day] day of [Insert  Month],  1997,  Amoco and
Buyer entered into a Purchase and Sale  Agreement  wherein Amoco agreed to sell
and  Buyer  agreed to  purchase  certain  oil and gas  properties  and  related
interests (the "Purchase and Sale Agreement").

      WHEREAS,  Amoco currently  operates various Properties (as defined in the
Purchase and Sale Agreement) and accounts for all of the Properties.

      WHEREAS,  Buyer  desires  that Amoco  continue to operate the  Properties
which  it  currently  operates  and  account  for all of the  Properties  for a
limited period of time in accordance with the terms of this Agreement.

      NOW,  THEREFORE,  based  upon the  mutual  covenants  and  considerations
contained herein, the parties agree as follows:

1.    SCOPE  OF  SERVICES:  Effective  as of the  Closing  (as  defined  in the
Purchase and Sale  Agreement),  Amoco shall continue the physical  operation of
the  Properties  which  it  currently  operates  and  account  for  all  of the
Properties  in  conformity  with general  practices in the oil and gas industry
and in  accordance  with the various  agreements.  The services to be performed
by Amoco under the terms of this Agreement shall be limited to the following:

      (a)  Employ such personnel as may be reasonably  necessary to perform the
      services provided under this Agreement;

      (b)  Administer  the books,  records  and  accounts  associated  with the
      ownership and operation of the Properties;

      (c)  Purchase  supplies,   materials,  tools,  facilities  and  equipment
      associated with the ownership and operation of the  Properties;  provided
      however,  Amoco shall not,  without the prior  written  consent of Buyer,
      purchase  any of the  above if such  purchase  would  result in a change,
      obligation  or  liability  in excess of One Hundred  Thousand  and No/100
      Dollars  ($100,000)  for any  single  item,  except  in cases  reasonably
      believed by Amoco to constitute  an emergency;

      (d)  Contract for services  associated  with the  ownership and operation
      of the Properties;  provided however,  Amoco shall not, without the prior
      written  consent of Buyer,  enter  into a service  contract  which  would
      result in a charge,  obligation  or  liability  in excess of One  Hundred
      Thousand  and  No/100  Dollars  ($100,000),  except  in cases  reasonably
      believed by Amoco to constitute  an emergency;

      (e)  Pay  all  lease  rentals,  shut-in  royalties,   minimum  royalties,
      payments  in  lieu  of  production,   royalties,   overriding  royalties,
      production  payments,  net profit payments and similar  burdens,  and pay
      all operating  costs,  vendor invoices and contractor  invoices which are
      required  to be paid  under the terms and  provisions  of the  applicable
      agreements and which are  associated  with the ownership and operation of
      the Properties;

      (f)  Pay all lease settlements and other liquidated monetary  obligations
      which are associated with the ownership and operation of the Properties;

      (g)  Provide marketing,  gas control and other similar services necessary
      to sell the products  produced from or associated  with the Properties in
      a manner consistent with Amoco's past practices;

      (h)  Execute  routine  contracts or documents  necessary  for carrying on
      business related to the Properties;  provided  however,  Amoco shall not,
      without  the prior  written  consent  of  Buyer,  enter  into any  single
      contractual  arrangement  which would result in a charge,  obligation  or
      liability  in excess of Fifty  Thousand  and  No/100  Dollars  ($50,000),
      except in cases reasonably believed by Amoco to constitute an emergency;

      (i)  Submit  reports  to  state,   federal  or  tribal  authorities,   as
      appropriate; and

      (j)  Provide   assistance,   as   reasonably   requested  by  Buyer,   in
      familiarizing  Buyer's personnel  (including contract personnel) with the
      operation of the Properties.

2.    LIMITATION ON SERVICES;  COOPERATION:  Notwithstanding anything contained
in Section 1 to the  contrary,  Amoco shall not have the  obligation to provide
services  under  the  terms of this  Agreement  (including  without  limitation
providing  Buyer  with  records,  information  and  data)  which  Amoco did not
perform  for its own  account  immediately  prior to  Closing.  Amoco and Buyer
agree to cooperate  with each other in order to facilitate  Buyer's  reasonable
workover,  recompletion,   drilling,  deepening,  sidetracking,   treating  and
stimulating operations.

3.    TERMINATION  AND TURNOVER  DATE:  This  Agreement  shall  commence on the
date first  referenced  above and shall  terminate  when the services have been
performed with respect to February, 1998 production.

4.    REIMBURSEMENT:  Buyer  shall  reimburse  Amoco  for any  and  all  costs,
expenses  and COPAS  overhead  charges  (billed by third  parties)  incurred by
Seller and associated  with  operating the  Properties  during the term of this
Agreement.

5.    FEES:  Buyer shall pay to Amoco a fee of Four Hundred Fifty  Thousand and
No/100  United  States  Dollars (US  $450,000)  commencing  as of the Effective
Time (as defined in the Purchase and Sale  Agreement)  and each calendar  month
thereafter to compensate Amoco for the service performed hereunder.

6.    MONTHLY  STATEMENT:  Within thirty (30) days after each  calendar  month,
Amoco shall  submit to Buyer a  statement  substantially  in the form  attached
hereto as Exhibit "1" ("Estimated  Monthly  Statement").  The Estimated Monthly
Statement   shall  include  the  following   information   to  the  extent  the
information is attributable to Amoco's  interest in the Properties  immediately
prior to Closing:
 
      (a)  Amoco's estimate of sales volumes and value;

      (b)  All direct  costs,  expenses and COPAS  overhead  charges  billed by
           third parties to Amoco,  including without limitation  settlement to
           leases and other liquidated monetary obligations;

      (c)  Estimated capital expenditures recorded by Amoco;

      (d)  Amoco's fee; and

      (e)  Net estimated cash available for transfer.

If the cash  available  for transfer  shown on Exhibit "1" is  positive,  Amoco
shall  remit such  amount to Buyer  within  thirty (30) days of delivery of the
Estimated  Monthly  Statement.  If the cash  available  for  transfer  shown on
Exhibit "1" is negative,  Buyer shall remit such amount to Amoco within  thirty
(30) days of Buyer's receipt of the Estimated Monthly Statement.

7.    FINAL TRANSITION SETTLEMENT:  As soon as reasonably  practicable,  but in
no event  more than  ninety  (90) days  after  termination  of this  Agreement,
Amoco shall  prepare and deliver to Buyer a final  transaction  statement  in a
form  similar to Exhibit "1"  setting  forth  actual  revenues,  direct  costs,
expenses,   COPAS  charges,   revenues   returned  to  leases  and  capitalized
expenditures  for the  Properties  during  the term of this  Agreement  ("Final
Transition  Statement").  Within  forty-five  (45) days  after  receipt  of the
Final  Transition  Settlement,  Buyer shall  deliver to Amoco a written  report
containing  any changes  that Buyer  proposes  be made to the Final  Transition
Settlement.  If Buyer  fails to  timely  deliver  the  written  report to Amoco
containing  Buyer proposals to be made to the Final Transition  Statement,  the
Final  Transition  Statement  delivered by Amoco shall be deemed to be true and
correct  and the same shall be binding on and  non-appealable  by the  parties.
The parties  shall  undertake to agree with respect to the amounts due no later
than  thirty  (30)  days  after  Amoco's  receipt  of  Buyer's  report.  If the
parties  fail to agree within such thirty (30) day period,  the disputed  items
shall be resolved by submitting  the same to a firm of  independent  nationally
recognized  accountants  mutually  acceptable  to the parties (the  "Accounting
Referee").  The  Accounting  Referee  shall  resolve the dispute  within thirty
(30) days  after  having the  relevant  materials  submitted  for  review.  The
decision  of the  Accounting  Referee  shall  be  binding  on the  parties  and
non-appealable.  The fees and expenses  associated with the Accounting  Referee
shall be borne  equally  by Amoco and Buyer.  The date upon  which all  amounts
are agreed to by the  parties,  whether by decision of the  Accounting  Referee
or  otherwise,  shall  be  herein  called  the  "Final  Settlement  Date."  Any
amounts  owed by  either  party to the  other as a result  of such  adjustments
shall be paid within five (5) days after the Final Settlement Date.

8.    INDEMNIFICATION:  Amoco, its officers,  agents,  employees and Affiliates
(collectively  "Amoco  Group")  shall not be liable  for any  claims,  demands,
suits,  causes of action,  losses,  damages,  liabilities and costs  (including
attorneys'  fees  and  costs  of  litigation)  ("Claims")  arising  out  of  or
resulting  from the  services  provided  by the Amoco  Group under the terms of
this  Agreement,  except  for  matters  caused by or  resulting  solely  from a
criminal act,  fraudulent  act, gross  negligence or willful  misconduct of the
Amoco  Group.  Buyer  shall  release  the  Amoco  Group  from and  shall  fully
protect,  indemnify  and defend the Amoco Group and hold each of them  harmless
from and  against  any and all  Claims  arising  out of or  resulting  from the
services  provided  by the  Amoco  Group  under  the  terms of this  Agreement,
regardless of cause or of any  negligent  acts or omissions of any of the Amoco
Group,  other than matters  caused by or resulting  solely from a criminal act,
fraudulent act, gross negligence or willful misconduct of the Amoco Group.

9.    ASSIGNABILITY:  The rights,  duties and  privileges  under this Agreement
shall not be assigned by the parties hereto  without the prior written  consent
of the  non-assigning  party;  provided  however,  Amoco  shall be  entitled to
engage  contract   personnel  to  perform  services   contemplated  under  this
Agreement.

10.   GOVERNING  LAW: This Agreement  shall be governed by and construed  under
the laws of the State of  Wyoming,  excluding  any  conflict of law rules which
may require the application of laws of another jurisdiction.

11.   NOTICES:  All  notices,   requests  and  other  communications  shall  be
provided in accordance with the terms of the Purchase and Sale Agreement.

12.   OTHER  AGREEMENTS:  If  there  is a  conflict  between  the  terms of the
Purchase  and Sale  Agreement  and the  terms of this  Agreement,  the terms of
this Agreement  shall control the rights and  obligations  of the parties,  but
only to the extent  necessary to resolve the conflict.  All  capitalized  terms
not  defined  in this  Agreement,  shall  have  the  meaning  contained  in the
Purchase and Sale Agreement.

      IN WITNESS  WHEREOF,  the parties  agree to the  foregoing on the day and
year first set forth above.

                               AMOCO PRODUCTION COMPANY


                               By:                            
                               Name:                          
                               Title: Attorney-in-Fact




                               [Insert Company Name]

                               By:                            
                               Name:                          
                               Title:                              




                                  EXHIBIT "1"

                            TO TRANSITION AGREEMENT

                          ESTIMATED MONTHLY STATEMENT
               FOR THE PERIOD (MONTHLY DURING TRANSITION PERIOD)
                                (In Thousands)


CASH FLOWS PROVIDED BY (UTILIZED IN)
OPERATING AND INVESTING ACTIVITIES:

Revenue                                                   $XXX

Less:
Direct costs, expenses and COPAS charges                   XXX

Revenues returned to leases                                XXX

Capital expenditures                                       XXX

Amoco's fee                                                XXX



CASH AVAILABLE FOR TRANSFER                               $XXX




                                  EXHIBIT "P"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                               LICENSE AGREEMENT

      THIS LICENSE  AGREEMENT (this  "Agreement") is dated the [Insert Day] day
of [Insert Month],  1997, by and between AMOCO PRODUCTION  COMPANY,  a Delaware
corporation,  with an office at 501 WestLake  Park  Boulevard,  Houston,  Texas
77079  (hereinafter  referred  to as  "Amoco")  and  [Insert  Company  Name]  a
[Insert  State  of  Incorporation]  corporation,  with  an  office  at  [Insert
Address]  (hereinafter  referred  to  as  "Licensee"),  and  is  based  on  the
following premises:

      WHEREAS,  Amoco and Licensee  entered into a Purchase and Sale  Agreement
dated the [Insert  Day] day of [Insert  Month],  1997  wherein  Amoco agreed to
sell and Licensee  agreed to purchase  Amoco's  interest in the certain oil and
gas properties and related interest ("Purchase and Sale Agreement");

      WHEREAS,  Amoco has developed or acquired certain  Automation  Technology
(as hereinafter  defined)  relating to field  automation  systems for producing
oil and gas; and

      WHEREAS,  Amoco and Licensee have reached  agreement  with respect to the
terms of the above.

      NOW, THEREFORE,  for valuable  consideration and the mutual covenants and
agreements herein contained, Amoco and Licensee agree as follows:

      1.   Definitions.  As used in this  Agreement,  the following terms shall
have the respective meanings ascribed to them below:

      1.1  "Automation Technology" means:

           (a)  all trade secrets and know-how (including,  but not limited to,
      technical information,  reports, data, operating information,  processes,
      methods  of  control,   software,   written   processes   and   reservoir
      descriptions,  and  engineering  drawings)  relating to the automation of
      oil and gas wells, including:

                (i) electronic flow measurement and well control;

                (ii) equipment  useful for automating  compressor  stations and
           gas plants;

                (iii)  Standard  Automation  Modular  System  software known as
           "SAMS"; and

                (iv)  firmware  known as  "AMOCAMS"  developed by Amoco for use
           in connection  with Automation  Technology  equipment which is owned
           and  controlled  by Amoco or affiliates of Amoco and for which Amoco
           has the right to make the grants provided herein; and

           (b)  patents and other intellectual  property rights of Amoco to the
      extent and only to the extent that such  patents  and other  intellectual
      property rights directly pertain to 1.1(a) above.

      1.2  "Proprietary   Automation   System"  means  field  well   automation
systems, equipment, and facilities embodying Automation Technology.

      2.   Grant of Rights Under Automation Technology.
 
           (a)  Amoco hereby  grants to Licensee,  subject to all the terms and
      conditions   of  this   Agreement,   a   nonexclusive,   nontransferable,
      royalty-free  right  and  license  to  use  Automation  Technology  and a
      nonexclusive, nontransferable,  royalty-free immunity from suit under the
      claims  of any U.S.  patents  existing  as of the date  hereof,  owned or
      controlled  by Amoco or any  affiliate  of Amoco  which may be  infringed
      through  the  use  of  Automation  Technology,  to  use  such  Automation
      Technology  solely and  expressly  for the purpose of operating the wells
      referenced on Exhibit "A" of the Purchase and Sale Agreement.

           (b)  Nothing  contained  in this  Agreement  shall be  construed  to
      grant  Licensee any implied rights or licenses with respect to Automation
      Technology,  and  except  as  expressly  set  forth  in  this  Agreement,
      Licensee  agrees not to use, or allow the use of,  Automation  Technology
      for the  benefit of any party  other  than  Licensee  or for any  purpose
      other than as set forth in 2(a) above,  without the prior written consent
      of Amoco.

      3.   Third-Party  Licenses.  It is  understood  that certain  third-party
licenses are required  before  Licensee can utilize the  Automation  Technology
licensed  hereunder,  as listed in Exhibit  "A" to this  Agreement.  Amoco will
use  reasonable  efforts in assisting  Licensee in obtaining at a limited costs
(but at  Licensee's  sole  cost)  third-party  software  license(s)  needed  to
continue  automation  of the wells  referenced  on Exhibit "A" of the  Purchase
and  Sale   Agreement  as  currently   existing.   Licensee   shall  be  solely
responsible  for all transfer  fees and  maintenance  fees  incurred  which are
associated with such third-party licenses.

      4.   Format.  Amoco  will  provide  Licensee  with one (1) copy of object
code and source code useful for operating the  Proprietary  Automation  System,
and  one  (1)  copy  of  any  and  all  user  instruction  manuals  or  program
documentation therefor.

      5.   Modifications.  Licensee  acknowledges  Amoco's  proprietary  rights
and title to Automation  Technology and the Proprietary  Automation  System and
agrees  to  make  available  to  Amoco  promptly  and at no  charge  for use in
Amoco's normal business  operations,  all modifications  and  enhancements,  if
any,  which  Licensee  or its  contractors  hereafter  may  make to  Automation
Technology or the Proprietary Automation System.

      6.   Maintenance.  Licensee agrees and acknowledges  that Amoco shall not
be required to perform any maintenance  whatsoever of Automation  Technology or
the  Proprietary   Automation  System,   including  without   limitation,   the
performance  of   modifications   and/or   enhancements   to  the   Proprietary
Automation System.

      7.   Warranties.   Licensee   acknowledges  and  agrees  that  Automation
Technology is being provided by Amoco to Licensee "As-Is,  Where-Is",  and with
all faults in its  present  condition  and state of repair,  without  recourse.
Amoco  hereby  disclaims  any  and  all   representations   and/or   warranties
concerning  the  Automation   Technology,   express,   statutory,   implied  or
otherwise,  including without limitation,  condition,  quality, compliance with
applicable  laws,  absence of  defects  (latent or  patent),  safety,  state of
repair,  merchantability,  fitness for a  particular  purpose or ability of the
Automation  Technology  or  Proprietary  Automation  Systems  to  comply  with,
address  or  adapt  to  the  year  2000  which  is  approaching,  and  Licensee
expressly releases Amoco from the same.

      8.   Release.  Licensee  agrees  that Amoco shall not be  responsible  or
liable  for any  loss,  destruction  of  property,  loss of  profits  or  other
damages  whatsoever,   including  without  limitation,  any  direct,  indirect,
incidental  or  consequential  damages of any nature which may be caused by the
Proprietary  Automation  System or by Licensee's use of Automation  Technology,
and Licensee hereby releases Amoco from all such responsibility and liability.

      9.   Indemnity.  Licensee  shall  release  Amoco  from  and  shall  fully
protect,  indemnify  and defend  Amoco,  its  officers,  agents,  employees and
affiliates  (collectively  "Amoco  Group") and hold each of them  harmless from
and against  any and all  claims,  demands,  suits,  causes of action,  losses,
damages,  liabilities  and  costs  (including  attorneys'  fees  and  costs  of
litigation)  ("Claims") relating to, arising out of, or connected,  directly or
indirectly,  with the use of  Automation  Technology  under  the  terms of this
Agreement,  no matter  when  asserted,  including  without  limitation,  Claims
relating  to:  (a) injury or death of any  person or  persons  whomsoever,  (b)
damages  to or loss of any  property  or  resources,  (c)  common law causes of
action such as negligence,  gross  negligence,  strict  liability,  nuisance or
trespass  and/or (d) fault imposed by statute,  rule,  regulation or otherwise.
The indemnity  obligation and release  provided  herein shall apply  regardless
of cause or of any  negligent  acts or omissions  (excluding  gross  negligence
and willful misconduct) of any of the Amoco Group.

      10.  Confidentiality.
 
           (a)  Licensee   shall   maintain  in  confidence  and  not  disclose
      Automation  Technology  to  any  third  parties,  except  contractors  of
      Licensee  performing   maintenance  or  providing   enhancements  to  the
      Proprietary  Automation  System for use as  permitted  under  paragraph 2
      hereinabove.  Licensee shall be  responsible  for any disclosure or other
      breach  of  this  provision  by  its  contractors.  Licensee  agrees  and
      acknowledges that Automation  Technology is the confidential  information
      of and is proprietary to Amoco. All applicable  copyright,  trade secret,
      patent and other  intellectual  property rights in Automation  Technology
      and in the Proprietary  Automation  System are and shall remain in Amoco.
      To the extent that such  materials  are not  already so marked,  Licensee
      shall  mark and  maintain  all  documentation  received  from  Amoco  and
      relating to the Proprietary Automation System as follows:

           COPYRIGHT 1997 AMOCO CORPORATION
           CONFIDENTIAL AND PROPRIETARY
           ALL RIGHTS RESERVED

           (b)  The  parties  acknowledge  that  the  rights  reserved  to  the
      parties under this Agreement are  necessarily of a special,  unique,  and
      extraordinary  nature and that the loss arising from breach or threatened
      breach thereof,  cannot  reasonably or adequately be compensated by money
      damages and will cause the parties to suffer  irreparable harm and that a
      remedy at law for any breach  thereof  will be  inadequate.  Accordingly,
      the  parties  agree that each shall be entitled  to  injunctive  or other
      extraordinary  relief  in  case  of  any  such  breach  or  attempted  or
      threatened   breach  of  covenants  set  forth  in  this   paragraph  10,
      prohibiting such breach or attempted or threatened  breach and commanding
      compliance  with such  paragraph  10,  merely by proving the existence of
      such breach or threatened or attempted breach,  and without the necessity
      of proving  irreparable  harm or inadequacy of legal  remedies.  However,
      this  provision  shall in no way  limit any  other  rights  or  remedies,
      including  the recovery of damages,  which the parties may have under the
      terms of this Agreement or at law or in equity.

      11.  Amoco  Name.  Licensee  shall make no oral or written  statement  or
perform any act indicating that Amoco or any of Amoco's  affiliates  endorse or
approve,   or  has  endorsed  or  approved,   any  version  of  the  Automation
Technology  or  Proprietary   Automation  System  made  or  used  by  Licensee.
Licensee  shall not  associate  or in any way connect any name or  trademark of
Amoco or any of  Amoco's  affiliates  with  Licensee's  work  products  without
Amoco's prior written consent.

      12.  Export Control  Regulations.  Licensee agrees to abide by the export
control   regulations   of  the  United   States  with  respect  to  Automation
Technology and the Proprietary Automation System.

      13.  Term.  This  Agreement  shall commence on the Closing (as defined in
the Purchase and Sale  Agreement)  and with respect to each well  referenced on
Exhibit "A" of the Purchase and Sale  Agreement  ("Well")  shall have a term of
one (1)  year  and as long  thereafter  as  Licensee  owns an  interest  in and
operates such Well, unless sooner terminated as provided herein below:

           (a)  This Agreement will terminate  automatically  as to any Well if
      and when  Licensee  no longer  owns a working  interest  in such Well and
      operates such Well, and this Agreement  will terminate  automatically  in
      whole if and when  Licensee no longer  owns an  interest in and  operates
      any of the Wells;

           (b)  This  Agreement  will  terminate   automatically   if  Licensee
      attempts to transfer  all or any of its rights  under this  Agreement  in
      whole or in part without the prior written consent of Amoco;

           (c)  This  Agreement may be terminated at Amoco's option if Licensee
      breaches any material  provision  of this  Agreement  and fails to remedy
      said  breach  within ten (10) days after  receipt of written  notice from
      Amoco thereof; and

           (d)  This  Agreement  may be  terminated  by  Licensee  (except  for
      Sections  7, 8, 9 and 10 which  shall  survive  termination)  at any time
      effective  upon  Amoco's  receipt  of  all   documentation  and  software
      relating to Automation  Technology and the Proprietary  Automation System
      and a certification  from Licensee  warranting that Licensee is no longer
      using  and shall  not in the  future  use the  Automation  Technology  or
      Proprietary Automation System.

Termination  of  this   Agreement   shall  not  relieve  either  party  of  its
obligations  hereunder  which  shall have  arisen  prior to  termination.  Upon
termination  of this  Agreement,  Licensee  shall return to Amoco  promptly the
originals and all of Licensee's  copies or reproductions  of documentation  and
software  relating  to  Automation  Technology  or the  Proprietary  Automation
System.

      14.  Audit  Rights.  Amoco  shall  have the  right to  perform  audits or
require  Licensee to perform  periodic  self-audits to verify  compliance  with
the terms and  conditions of this  Agreement,  including  those relating to the
use of  Automation  Technology.  Periodic  audits shall extend to such records,
documentation,  and other information  insofar as reasonably deemed appropriate
by Amoco  for its  review  in order to  support  an  opinion  with  respect  to
compliance  with the terms of this  Agreement.  A  written  report of the audit
findings  shall be submitted to Amoco.  The  frequency  and scope of the audits
shall be at the sole reasonable discretion and cost of Amoco.

      15.  Miscellaneous.

           (a)  Successors  and Assigns.  This  Agreement is personal in nature
      and is for the sole  benefit of the parties.  The rights and  obligations
      shall not be assigned by  Licensee,  either in whole or in part,  without
      the express  written  consent of Amoco,  and any such  assignment that is
      made without such consent  shall be void and of no force and effect.  The
      terms,  covenants and  conditions  contained in this  Agreement  shall be
      binding  upon and shall  inure to the benefit of Amoco and  Licensee  and
      their respective successors and assigns.

           (b)  Governing  Law.  This  Agreement   shall  be  governed  by  and
      construed under the laws of the State of Wyoming,  excluding any conflict
      of law  rules  which  may  require  the  application  of laws of  another
      jurisdiction.

           (c)  Notices.  All notices,  requests and other communications shall
      be  provided  in  accordance  with  the  terms of the  Purchase  and Sale
      Agreement.

           (d)  Amendments  and  Severability.  No  amendments or other changes
      to this Agreement  shall be effective or binding on either of the parties
      unless  the  same  shall be in  writing  and  signed  by both  Amoco  and
      Licensee.   The  invalidity  of  any  one  or  more  provisions  of  this
      Agreement  shall not affect the  validity of this  Agreement  as a whole,
      and in case of any such invalidity,  this Agreement shall be construed as
      if the invalid provision had not been included herein.

           (e)  No  Third  Party  Beneficiaries.   Nothing  contained  in  this
      Agreement  shall  entitle  anyone  other than Amoco or  Licensee or their
      authorized  successors and assigns to any claim, cause of action,  remedy
      or right of any kind whatsoever.

           (f)  Headings.  The titles and headings set forth in this  Agreement
      have  been  included  solely  for  ease of  reference  and  shall  not be
      considered in the interpretation or construction of this Agreement.

           (g)  No Partnership  Created.  It is not the purpose or intention of
      this  Agreement  to create (and it shall not be  construed as creating) a
      joint venture,  partnership or any type of  association,  and the parties
      are not  authorized  to act as agent or  principal  for each  other  with
      respect to any matter related hereto.

           (h)  Entire  Agreement.  This  Agreement  supersedes  all  prior and
      contemporaneous  negotiations,  understandings,  letters  of  intent  and
      agreements  (whether oral or written) between the parties relating to the
      Proprietary  Automation  System and constitutes the entire  understanding
      and  agreement  between  the parties  with  respect to the license of the
      Proprietary Automation System.

      The parties have  executed  this  Agreement on the day and year first set
forth above.


                               AMOCO PRODUCTION COMPANY

                               By:                            

                               Name:                          

                               Title: Attorney-in-Fact



                               [Insert Company Name]

                               By:                            

                               Name:                          

                               Title:                              



                                  EXHIBIT "A"
                             To License Agreement
                       between Amoco Production Company
                           and [Insert Company Name]

Third-Party Products necessary for use of Amoco SAMS Software:

====================================================================
PRODUCT                            VENDOR
====================================================================

SunSoft Interactive UNIX           SunSoft, Inc.
Graphical Solution Multi-User      6601 Central Drive West, Suite
                                   700
                                   Los Angeles, CA  90099-5865

SunSoft Interactive                SunSoft, Inc.
Software Development System        6601 Central Drive West, Suite
                                   700
                                   Los Angeles, CA  90099-5865
Unify Accel                        Unify Corporation
l IDS                              15770 North Dallas Pkwy., Suite
Development Version                600
                                   Dallas, TX  75248
                                   Attn: Richard Templin

Vermont Views for UNIX             Vermont Creative Software
Non-Commented Source               Pinnacle Meadows
                                   Richmond, VT  05476
                                   Attn: Peter Drake


Third-Party Products Necessary for use of Amoco RTU Software:

======================================================================
PRODUCT                            VENDOR
======================================================================
C-Exec for 8086/88                 JMI Software Consultants
Runtime Version                    904 Sheble Lane
                                   Spring House, PA 19477





                                  EXHIBIT "Q"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                          SUBLEASE NOVATION AGREEMENT

      THIS  SUBLEASE  NOVATION  AGREEMENT  (this  "Agreement")  is  dated  this
[Insert  Day] day of [Insert  Month],  1997,  by and  between  AMOCO  EQUIPMENT
LEASING COMPANY,  a Delaware  corporation,  with an office at 200 East Randolph
Drive,  Chicago,  Illinois 60601 (hereinafter  referred to as "Lessor"),  AMOCO
PRODUCTION  COMPANY,  a Delaware  corporation,  with an office at 501  WestLake
Park  Boulevard,  Houston,  Texas 77079  (hereinafter  referred to as "Lessee")
and [Insert  Company  Name],  a [Insert  State of  Incorporation]  corporation,
with an office at [Insert  Address]  (hereinafter  referred to as "Sublessee"),
and is based on the following premises:

      Whereas,  Lessor and Lessee entered into an Equipment  Sublease dated the
19th  day  of  December,  1991  ("Prior  Sublease"),   covering  a  compression
facility  leased  from CLC  Leasing  Company A for use at the Beaver  Creek Gas
Processing  Plant  ("Compression  Facility").  A copy of the Prior  Sublease is
attached hereto as Exhibit "1" and incorporated herein by reference;

      Whereas,  Lessee  transferred to Sublessee all of Lessee's  right,  title
and interests in and to the facilities of which the  Compression  Facility is a
part; and

      Whereas,   Sublessee  desires  to  assume  all  of  Lessee's  rights  and
obligations under the terms of the Prior Sublease.

      NOW,  THEREFORE,  in  consideration  of the  rentals to be paid and other
good and valuable consideration, the parties agree as follows:

      1.  Lessor  hereby  authorized  Lessee to assign  the Prior  Sublease  to
Sublessee upon the terms and conditions set forth herein.

      2. As of the date first referenced  above,  Sublessee agree to assume any
and all  rights  and  obligations  under the terms of the Prior  Sublease,  and
Lessee  shall  have  no  continuing   obligation  with  respect  to  the  same.
Sublessee  shall  release  Lessee from and shall fully  protect,  indemnify and
defend  Lessee,  its  officers  agents,   employees  and  affilitates  ("Lessee
Group") and hold them  harmless  from and against any and all claims,  demands,
suits,  causes of action,  losses,  damages,  liabilities and costs  (including
attorneys'  fees and costs of litigation)  ("Claims),  relating to, arising out
of, or connected,  directly or indirectly,  with the Prior Sublease  pertaining
to the period of time at and after the date first  referenced  above, no matter
when asserted,  including  without  limitation,  Claims relating to: (a) injury
or death of any person or  persons  whomsoever,  (b)  damages to or loss of any
property  or  resources,  (c) common law causes of action  such as  negligence,
gross  negligence,  strict  liability,  nuisance or trespass,  and/or (d) fault
imposed by statute,  rule,  regulation or otherwise.  The indemnity  obligation
and  release  provided  herein  shall  apply  regardless  of  cause  or of  any
negligent   acts  or  omissions   (excluding   gross   negligence  and  willful
misconduct) of Lessee Group.
 
      IN WITNESS  WHEREOF,  the parties  agree to the  foregoing on the day and
year first set forth above.

LESSOR:                   AMOCO EQUIPMENT LEASING COMPANY



                          By: ______________________
                               Name:  D. B. Pinkert
                               Title:  Vice President


LESSEE:                   AMOCO PRODUCTION COMPANY


                          By: ______________________
                               Name:  Lon O. Buehner
                               Title: Attorney-in-Fact

SUBLESSEE:           [INSERT COMPANY NAME]



                          By: _______________________
                               Name:  [INSERT NAME]

                               Title:  [INSERT TITLE]





                                   EXHIBIT 1





                           PRIOR SUBLEASE AGREEMENT


                               THIRTY-ONE PAGES


 


                                  EXHIBIT "R"
                        To Purchase and Sale Agreement
                                by and between
                       Amoco Production Company, Seller
                                      and
                      Howell Petroleum Corporation, Buyer


                              GUARANTEE AGREEMENT

      This GUARANTEE  AGREEMENT  ("Guarantee") is made and given the ______ day
of  _________,  1997,  by  ________________,  a  _______  corporation,  with an
office in Houston,  Texas  ("Guarantor") in favor of AMOCO PRODUCTION  COMPANY,
a Delaware corporation, with an office in Houston, Texas ("Amoco").

      WHEREAS,  on the  ___  day of  November,  1997,  Amoco,  as  seller,  and
______________   ("Buyer"),   as  buyer,  entered  into  a  Purchase  and  Sale
Agreement  (the  "Agreement")  wherein Amoco agreed to sell and Buyer agreed to
purchase certain properties as further defined in the Agreement.

      WHEREAS,  a  condition  to Closing  contained  in the  Agreement  is that
Guarantor  provide a guaranty of the prompt,  faithful and full  performance of
the Agreement.

      WHEREAS,  Guarantor  acknowledges the benefits to it of the Agreement and
desires to provide said guaranty.

      NOW THEREFORE,  based on the mutual  covenants and  agreements  contained
herein, Amoco and Guarantor agree as follows:

      1.   Guarantor  hereby  unconditionally  guarantees  to Amoco the prompt,
faithful  and full  performance  of all of the  obligations  of Buyer under the
Agreement.  Any amounts due under this  Guarantee  will accrue simple  interest
from the date due under the  Agreement at a rate equal to the  published  prime
rate lending  rate of Chase  Manhattan  Bank,  New York,  New York,  but not to
exceed the maximum rate  permitted by law.  Guarantor  further  promises to pay
all reasonable  attorneys' fees and other damages,  costs and expenses incurred
by Amoco as a result of Buyer's  failure to fully and  faithfully  perform  its
obligations  under the  Agreement in connection  with the Agreement  covered by
this Guarantee,  or Guarantor's  failure to fulfill its  obligations  under the
Guarantee.  In  addition,  Guarantor  agrees  to  reimburse  Amoco for all sums
paid to Amoco by Buyer,  which sums Amoco is  subsequently  required  to return
or repay by reason of Buyer's  bankruptcy,  insolvency or a requirement  of any
legislative  enactment,  proclamation or judicial proceeding  providing for the
postponement  of the payment of debts or affecting  the exercise of  creditors'
rights.

      2.   This Guarantee shall be a continuing  guaranty of payment and not of
collection.   It  shall   remain  in  full  force  and  effect   pending   full
performance of the Agreement and the undertakings stated in this Guarantee.

      3.   Amoco hereby agrees to use  reasonable  efforts to inform  Guarantor
in  writing  of any  dishonor  or default by Buyer at least five (5) days prior
to making  demand on  Guarantor  for  payment  under this  Guarantee;  provided
however,  Amoco shall not be required to so inform  Guarantor as a prerequisite
to making demand on Guarantor for payment  under this  Guarantee,  or enforcing
any other of Amoco's rights and Guarantor's obligations under this Guarantee.

      4.   Guarantor  shall  pay or  repay  Amoco,  free of any  deductions  or
withholdings,  all monies due to Amoco  pursuant  to this  Guaranty  within ten
(10) days after  receiving  written  demand for payment  from Amoco.  Guarantor
shall  make  payment  of such  amount  in U.S.  dollars  by  wire  transfer  in
immediately  available funds to the account or accounts  designated by Amoco in
its notice.

      5.   Guarantor hereby waives the giving of any notice,  including but not
limited to, the following:

      (a)  Notice that Buyer has entered  into,  and incurred  liabilities  and
           obligations in connection with the Agreement and related  agreements
           with Amoco;
      (b)  Notice of the  modification or amendment of the Agreement or related
           agreements between Buyer and Amoco;
      (c)  Notice of any extension of time or other  modification  of the terms
           for  payment  of any  sums  due and  payable  by  Buyer  to Amoco in
           connection with the Agreement;
      (d)  Notice  of  presentment,  demand  for  payment,  default,  dishonor,
           protest or notice of protest with respect to this Guarantee; and
      (e)  Notice of any  defaults  by or disputes  with Buyer with  respect to
           payment or performance in connection with the Agreement.

      6.   Guarantor  acknowledges  that the  modification of the Agreement and
related  agreements  between  Buyer and Amoco shall not  discharge or otherwise
affect  the  liability  of  the  Guarantor  with  respect  thereto  under  this
Guarantee.   Guarantor   further  agrees  that  its   obligations   under  this
Guarantee shall be unconditional,  irrespective of any circumstance  other than
payment or satisfaction  which might otherwise  constitute a legal or equitable
discharge of a surety or guarantor.

      7.   Guarantor's  obligations under this Guarantee are independent of all
obligations  of Buyer to Amoco.  Amoco shall not be  required to proceed  first
against  Buyer or any other person,  firm or  corporation  before  resorting to
Guarantor for payment under this Guarantee.

      8.   Demands on Guarantor  for payment under this  Guarantee  shall be in
writing and delivered by mail or telecommunication to the following address:

           Buyer
           __________________________
           __________________________
           __________________________

All  demands  for  payment  shall be  effective  when  received  by  Guarantor.
Guarantor  may change the  address to which  demands for payment are to be sent
upon written notice to Amoco.

      9.   Notices  to Amoco  under  this  Guarantee  shall be in  writing  and
delivered by mail or telecommunication to the following address:

           Amoco Production Company
           P. O. Box 3092
           Houston, Texas  77253-3092
           Attention:  General Manager, Acquisition and Divestments
           Fax:  (713) 366-7544

All notices  given to Amoco  shall be  effective  when  received by the persons
designated  herein  or  substitute  persons  designated  by  Amoco.  Amoco  may
change the persons and  addresses to which  notices are to be sent upon written
notice to Guarantor.

      10.  This Guarantee and each of its  provisions may be waived,  modified,
varied,  released,  terminated or  surrendered,  in whole or in part, only by a
duly authorized  written  instrument  signed by Amoco and Guarantor.  No waiver
by Amoco of  performance  by  Guarantor  under  any of the  provisions  of this
Guarantee  shall be  construed  as a waiver of any  subsequent  performance  by
Guarantor under the same or any other provisions of this Guarantee.

      11.  This  Guarantee is personal in nature and shall not be assignable by
the parties hereto.

      12.  THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH
THE  LAWS  OF THE  STATE  OF  WYOMING  AS TO  INTERPRETATION  AND  PERFORMANCE,
WITHOUT REFERENCE TO CONFLICTS OF LAW PRINCIPLES.

      13.  Unless stated  otherwise,  the  capitalized  terms contained in this
Guarantee shall have the meanings set forth in the Agreement.

      14.  Guarantor   represents  and  warrants  that,  at  the  time  of  the
execution and delivery of this  Guarantee,  no event exists which is reasonably
expected to materially  impair in any way the  obligations  and  liabilities of
Guarantor  to Amoco under this  Guarantee.  Guarantor  further  represents  and
warrants  that  the  person  signing  this  Guarantee  on its  behalf  has been
properly authorized by corporate action to do so.

      15.  This writing is the complete  and  exclusive  statement of the terms
of this  Guarantee and  supersedes  all prior oral or written  representations,
understandings,   and  agreements  between  Amoco  and  Guarantor.   Amoco  and
Guarantor  agree  that there are no  conditions  to the full  effectiveness  of
this Guarantee.


      IN WITNESS  WHEREOF,  the parties have duly executed this Guarantee as of
the date set forth above.

 


                                  AMOCO PRODUCTION COMPANY



                                  By:                              
                                  Name:  _______________________
                                  Title: Attorney-in-Fact

                                  BUYER


                                  By:__________________________
                                  Name: _______________________
                                  Title:_________________________



STATE OF TEXAS    Section   

COUNTY OF HARRIS  Section

      The  foregoing  instrument  was  acknowledged  before me this ____ day of
________,  1997, by ____________________ as  _______________________for  and on
behalf of ______________, a Delaware corporation.


My Commission Expires:            
_________________________________


                                  Signature


                                  _________________________________
                                  Name (Printed, Typed or Stamped)
                                  Notary Public in and for the
                                  State of   T E X A S


STATE OF TEXAS      Section 

COUNTY OF HARRIS    Section 

      The  foregoing  instrument  was  acknowledged  before me this _____day of
________,  1997,  by  ______________________  as  Attorney-in-Fact  for  and on
behalf of AMOCO PRODUCTION COMPANY, a Delaware corporation.


My Commission Expires:           
________________________________


                                  Signature


                                  _________________________________
                                  Name (Printed, Typed or Stamped)
                                  Notary Public in and for the
                                  State of   T E X A S