EXHIBIT 10.7


                              ASSIGNMENT AGREEMENT

THIS AGREEMENT (the "Assignment Agreement") is made and entered into on this
27th day of June, 2006, between:

                  PIN PETROLEUM PARTNERS LTD, a company incorporated under the
                  laws of the Province of British Columbia, having an office
                  address of Suite 2410, 650 West Georgia Street, Vancouver,
                  British Columbia, Canada, V6B 4N7

                  (the "Assignor")

AND:

                  RADIAL ENERGY INC., a company organized under the laws of the
                  State of Nevada, having an office at Suite 223, 1313 East
                  Maple Street, Bellingham, Washington, USA, 98225

                  (the "Assignee")

WHEREAS, the Assignor has certain rights and obligations under three Assignment
Agreements dated May 23, 2005, August 24, 2005 and August 24, 2005,
respectively, with Skyline Energy, LLC, to properties located in Cherokee
County, Texas, known as the Junction Prospect, the Northwest Jacksonville
Prospect and the Highway 79 Prospect (hereinafter collectively referred to as
the "Cherokee Agreements"), copies of which are attached hereto as Schedules A,
B and C; and

WHEREAS, the Assignor wishes to assign all of its rights and obligations in the
Cherokee Agreements to the Assignee; and

WHEREAS, the Assignee accepts such assignment and has agreed to be bound by the
Cherokee Agreements.

NOW THEREFORE in consideration of the mutual covenants and agreements contained
herein, IT IS HEREBY AGREED by the Assignor and the Assignee as follows:

1. The Assignor hereby assigns and transfers to the Assignee all of its rights
and obligations in, to, and under the Cherokee Agreements, subject to all the
terms and conditions thereof.

2. The Assignee hereby agrees to assume all of the Assignor's rights and
obligations under the Cherokee Agreements.

3. The Assignor reaffirms and represents and warrants that:


<PAGE>


                                       2


     (a)  the Cherokee Agreements are valid and in full force and effect, and
          that the representations and warranties contained in the Cherokee
          Agreements are true and correct on the date hereof;

     (b)  it has not entered into any negotiations, arrangements or agreements
          (either oral or written) relating to the Cherokee Agreements;

     (c)  the Cherokee Agreements and all of Assignor's rights, titles and
          interests therein and thereto are free and clear of any and all liens,
          charges, encumbrances and claims of whatsoever nature;

     (d)  Assignor has any and all corporate action necessary and/or required
          under all applicable laws, rules and regulations, including corporate
          governance law in British Columbia, in order to transfer its rights,
          titles and interests in, to and under the Cherokee Agreements to
          Assignee; and

     (e)  Assignor has full right and authority to enter into this Assignment
          Agreement and transfer, assign and convey to Assignee all of
          Assignor's rights, titles and interests relating to the Cherokee
          Agreements.

4. As consideration for the assignment of the Cherokee Agreements, the Assignee
agrees to:

     (a)  pay to the Assignor the sum of Seven Hundred Thousand Dollars
          ($700,000) in US funds within ninety (90) days from the date of this
          Assignment Agreement; and

     (b)  grant to the Assignor an overriding royalty interest in the sum of
          four percent (4%) from the Assignee's share of net revenue interest,
          pursuant to the Cherokee Agreements.

5. In the event the Assignee fails to make payment to the Assignor pursuant to
item 4(a) hereof, after Assignor gives Assignee written notice of such failure,
then the Assignor shall, at its option:

     (a)  be entitled, upon written notice of its intent to do so, have the
          rights and obligations under the Cherokee Agreements transferred
          hereunder revert back to the Assignor; or

     (b)  receive from the Assignee a penalty payment in the amount of One
          Hundred Twenty percent (120%) of the consideration set out in item
          4(a) hereof, and at the option of the Assignor, such sum shall be
          convertible into securities of the Assignee at a price equal to the
          lowest offering price of the Assignees securities to the general
          public during the current fiscal period.

6. By executing this Assignment Agreement, the Assignor and Assignee confirm
their intention to execute and deliver as promptly as practicable any other
documentation which may be required to give effect to this Assignment Agreement,
and to obtain the approval, agreement, and consent of their respective Boards of
Directors or governing bodies with respect to this Assignment Agreement. The
parties shall also cooperate in Assignee's compliance with applicable state and
federal securities laws, rules and regulations. This Assignment Agreement and
the execution hereof shall be strictly confidential between the parties and no
notice or press release relating to this Assignment Agreement shall be given by
either party without the prior written consent of the other party. Each party
shall provide information concerning terms of this Assignment Agreement and the
execution hereof only to its respective management and employees, and then, only
on a "need-to-know" basis.


<PAGE>


                                       3


7. This Assignment Agreement may not be amended or otherwise modified except by
an instrument in writing signed by both parties.

8. This Assignment Agreement shall be governed by and interpreted in accordance
with the laws of the State of Nevada and the parties irrevocably attorn to the
jurisdiction of the courts of Washoe County, Nevada. All disputes which may
arise under, out of, in connection with or in relation to this Agreement shall
be submitted to and finally settled by arbitration, which shall be subject to
the provisions of the Commercial Arbitration Rules of the American Arbitration
Association ("AAA") in effect from time to time, be conducted in Reno, Nevada,
by a single arbitrator under (and appointed in accordance with) the rules
established for domestic commercial arbitrations under the AAA in effect from
time to time, be administered by the AAA ,and be conducted in the English
language. The prevailing party in any such arbitration shall be entitled, in
addition to an award from the arbitrator, an award of all costs, expenses and
attorney fees incurred in the arbitration.

9. If any one or more of the provisions contained herein should be invalid,
illegal or unenforceable in any respect in any jurisdiction, the validity,
legality and enforceability of such provisions shall not in any way be affected
or impaired thereby in any other jurisdiction and the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.

10. This Agreement constitutes and contains the entire agreement and
understanding between the parties and supersedes all prior agreements,
memoranda, correspondence, communications, negotiations and representations,
whether oral or written, express or implied, statutory or otherwise, between the
parties or any of them with respect to the subject matter hereof.

11. This Agreement may not be assigned without the prior written consent of the
Assignor.

12. This Agreement may be executed in counterpart, each of which such
counterpart, whether in original or facsimile form, notwithstanding the date or
dates upon which this Agreement is executed and delivered by any of the parties,
shall be deemed to be an original and all of which will constitute one and the
same agreement, effective as of the reference date given above.

IN WITNESS WHEREOF, the Assignor and the Assignee have executed this Assignment
Agreement on the day and year first written above.

PIN PETROLEUM PARTNERS LTD.



/s/ WILLIAM FRIESEN
________________________________
Per:  William Friesen, President


RADIAL ENERGY INC.



/s/ G. LEIGH LYONS
_______________________________
Per:  G. Leigh Lyons, President


<PAGE>


                                  SCHEDULE "A"
                                  ____________


                               Skyline Energy, LLC
                               2301 Dublin Circle
                             Pearland, Texas 77581
                      Tele: 281-481-0881 Fax: 281-481-5645



                                  May 23, 2005



See Exhibit "A" for Addressees


Re: Junction Prospect
    Cherokee County, Texas
    (the "Prospect")

Gentlemen:

     This agreement (hereinafter referred to as "Agreement") is made and entered
into by and between Skyline Energy,  L.L.C.,  who address is 2301 Dublin Circle,
Pearland,  Texas 77581 (hereinafter referred to as "Assignor") and the signatory
parties  identified on Exhibit "A" and "A-l" relative to the leasehold  interest
more fully described in Exhibit "B" attached hereto and incorporated  herein for
all purposes,  (hereinafter singularly referred to as "Assignee" or collectively
as  "Assignees").  Subject to elections made to the contrary,  it is agreed that
all rights and benefits as well as all risks,  costs and expenses granted herein
unto  Assignees  shall be owned and borne by each Assignee in the percentage set
forth next to his name in Exhibit "A-l" hereto.

     Assignor  represents  that it is the present owner of all right,  title and
interest  in and to the oil and gas leases more fully  described  in Exhibit "B"
attached hereto and incorporated herein for all purposes.  Said leases cover 500
+- gross,  more or less, out of the J. Merrill  Survey,  A-564,  and the D. Earl
Survey, A-260, Cherokee County, Texas (hereinafter referred to as the "Leases").
The Leases cover the lands shaded yellow on the plat attached  hereto as Exhibit
"C" which is incorporated herein for all purposes.

     Assignee is desirous of  acquiring  from  Assignor the  undivided  interest
herein described in the Leases and participating in the drilling of a Test Well,
as defined  below,  for oil and gas  thereon  subject to the terms,  conditions,
reservations  and limitations  herein provided.  The parties  therefore agree as
follows:

With respect to the Leases, Assignor represents and warrants to Assignee that:


<PAGE>


     1.   Assignor owns each of the Leases free and clear of any liens, security
          interests or encumbrances of any kind placed thereon by Assignor.

     2.   To the best of Assignor's knowledge,  the Leases are in full force and
          effect,  are valid and  subsisting  leases,  and all rentals and other
          payments due under the Leases have been properly and timely paid,  and
          all  conditions  necessary to keep the Leases in force have been fully
          performed.

     3.   To the  best  of  Assignor's  knowledge,  no  suit,  action  or  other
          proceeding is pending before any court or  governmental  agency and no
          cause of action exists that relates to the Leases or that might result
          in  impairment  or loss of  Assignee's  title  to any  portion  of the
          Leases.


                                       1.

                                  Consideration
                                  _____________

     For and in consideration of the sums set. forth herein,  Assignor agrees to
assign,  in accordance with Section 9.I. below,  and with warranty of title, by,
through and under Assignor, but not otherwise, and further subject to the terms,
reservations  and conditions of this  Agreement,  the leasehold  interest in the
Leases to each  Assignee in the  proportions  set forth in Exhibit  "A-l" beside
Assignee's name; provided, however, as a condition precedent to such assignment,
Assignee  shall  have  paid  to  Assignor  its pro  rata  share  of the  Initial
Consideration,  defined as eight  eighths  (8/8ths)  of the cost of the  Leases,
legal fees, and geological and administrative costs through the date hereof, and
which is set forth on Exhibit "A-l" hereto,  and its pro rata share of Estimated
Dry Hole Costs, as hereinafter defined.  The Initial  Consideration is comprised
of the following sums:

          Land and Legal Costs
          Geological and Administrative Costs to Date  $195,000.00
                                                       ___________
          Total Initial Consideration                  $195,000.00
                                                       ===========

     It is  further  agreed  that  attached  hereto as  Exhibit  "A-2"  which is
incorporated  herein for all purposes is an Authority  for  Expenditure  ("AFE")
which sets forth the estimated  costs  necessary to drill the Test Well to Total
Depth,  evaluate same with a triple combination log and plug and abandon same if
a dry hole  ("Estimated  Dry  Hole  Costs").  By  execution  of this  Agreement,
Assignor and Assignee do each agree to bear and pay their respective share of


<PAGE>


the Estimated Dry Hole Costs of the Test Well.  Such actual drilling costs which
shall include, without limitation, surface damage and restoration costs.

Assignee  agrees  to bear  and pay for  their  proportionate  share  {Assignee's
"Before Prospect Payout Interest") of the costs associated with the drilling and
development of the prospect before Prospect Payout as hereinafter  defined,  and
their  proportionate  share (Assignee's "After Prospect Payout Interest") of the
costs  associated  with the  prospect  after  Prospect  Payout,  as  hereinafter
defined.

Operator  shall notify each Assignee of the estimated spud date of the Test Well
and request the advance  payment of Assignee's  Estimated  Dry Hole Costs.  Each
Assignee  shall  advance to Operator its share of the  Estimated  Dry Hole Costs
within fifteen (15) days from the date of receipt of said  notification.  Should
any  party  fail or  refuse  to  timely  forward  to  Operator  its share of the
Estimated  Dry Hole Costs  within said fifteen  (15) day period,  then  Operator
shall notify such party by certified  mail that it is  delinquent in making such
payment. It is understood that Operator shall not request the advance payment of
the  Estimated  Dry Hole  Costs  prior to  thirty  (30) days in  advance  of the
estimated spud date of the Test Well.

     Should any Assignee  fail to pay Operator  its share of the  Estimated  Dry
Hole Costs,  such Assignee shall further forfeit its right to participate in the
drilling of the Test Well and this  Agreement  shall be of no further  force and
effect with respect to such  forfeiting  Assignee  whereupon such Assignee shall
forfeit,  as liquidated  damages and not as a penalty,  its share of the Initial
Consideration previously paid to Assignor hereunder.

     Notwithstanding any terms contained in this Agreement to the contrary, upon
payment of the Initial  Consideration  by Assignee to Assignor,  Assignor  shall
have no  liability  to any  Assignee or to  Operator  in the event any  Assignee
subsequently fails to fund its share of the Estimated Dry Hole Costs;  provided,
however,  should another party fail to fund the Initial Consideration  resulting
in the failure of the Test Well to be drilled to total depth, Assignor agrees it
will   promptly   refund   Assignee's   share  of  the  Initial   Consideration.
Additionally,  except as otherwise provided in the Operating Agreement, Assignor
shall have no liability to Assignee for any acts or omissions of Operator in any
way associated with the drilling of the Test Well or any other well which may be
drilled under the terms of this Agreement.

In the event that Operator does not commence actual drilling  operations for the
Test Well on or before  February 28, 2 005, this Agreement  shall  terminate and
Assignor  shall  immediately  refund  the  Initial  Consideration  to  Assignee;
provided, however, the


<PAGE>


commencement date for the Test Well shall be extended in the event the Test Well
is not timely spudded due to delays caused by the drilling contractor. In the
event this Agreement terminates, Assignee shall have no obligation with respect
to any costs or liabilities incurred by Assignor with respect to this Agreement
and Operator agrees to indemnify and hold Assignee harmless against any and all
costs, expenses, claims, demands and causes of action of whatsoever kind or
character, including court costs and attorneys' fees, arising out of any
operations conducted, commitment made or any action taken or omitted with
respect to the Leases in the event the Test Well is not timely spudded by the
Operator as herein provided.
                                       2.

                                    Test Well
                                    _________

     On or before February 28, 2 006,  Oakwood Energy,  Inc. as initial operator
(the  "Operator"),  shall  commence  operations  for the drilling of a test well
(hereinafter  referred  to as the "Test  Well") at a  location  on the Leases as
designated  on the  AFE,  and  shall  thereafter  diligently  and in a good  and
workmanlike  manner  proceed  to cause  the  drilling  of the  Test  Well to the
stratigraphic  equivalent of the lesser of either (i) a true  vertical  depth of
approximately  5,000  feet  beneath  the  surface  of the  earth or (ii) a depth
sufficient  to test the upper  Woodbine  Sands as seen at a depth  sufficient to
test the  upper  Woodbine  Sands as seen at a depth  of  4,790'  to 4912' in the
Feldman Oil & Gas #1  McDonald,  Total Depth 5155'  (hereinafter  referred to as
"Total Depth");  provided,  however,  Assignor may at its sole option extend the
Test Well commencement date subject to rig availability.


                                       3.

                                 Substitute Well
                                 _______________

     In the event the Test Well is lost or junked due to mechanical  difficulty,
or there is encountered in the drilling thereof salt,  domal formation,  cavity,
igneous rock,  heaving  shale,  high pressure gas,  saltwater flow or such other
conditions  which render further  drilling  impracticable,  unduly  difficult or
expensive by ordinary standards of the oil industry, then in lieu of drilling to
Total Depth,  Assignees,  for a period of ninety (90) days after abandoning said
Test  Well,  for any of the  reasons  above  noted,  shall  have the  option  to
commence,  or cause to be commenced,  actual drilling of a substitute well. Such
well shall be drilled at a mutually  acceptable  location,  in a like manner and
under the same terms and  conditions  to the depth  specified for the Test Well,
and the term "Test  Well" as used  herein  shall be  construed  to  include  any
substitute well drilled under the terms of this Agreement; provided, however, in
the event Assignee does not elect to


<PAGE>


participate  in  the  substitute  well,   Assignee  shall  forfeit  the  Initial
Consideration previously paid to Assignor.


                                       4.

                               Operating Agreement
                               ___________________


         Except as otherwise set forth herein, all operations on the lands
covered by the Leases shall be conducted in accordance with the terms of this
Agreement and the Operating Agreement attached as Exhibit "D" which designates
Oakwood Energy, INC. as operator and which is executed contemporaneously
herewith. In the event of a conflict between the terms of this Agreement and the
Operating Agreement, the terms of this Agreement shall prevail and control.


                                       5.

                               Overriding Royalty
                               __________________


     It is agreed and understood that Assignor  hereby reserves unto itself,  or
its designees,  an overriding  royalty burdening the lands covered by the Leases
equal to twenty-five  percent (25%) less presently  existing  leasehold  burdens
thereby  delivering  Assignee  its pro rata share of a  seventy-five  percent of
eight-eights (75% of 8/8ths) net revenue interest.

     In the event any of the  Leases do not cover a full  mineral  interest,  or
Assignor does not own the full leasehold  interest therein,  then the overriding
royalty herein reserved shall be proportionately  reduced.  Furthermore,  should
any of the Leases cover less than all of the lands included within a pooled unit
allocated  to any well drilled  pursuant to the terms  hereof,  such  overriding
royalty  reserved  by  Assignor  herein  shall be  further  reduced  and paid in
proportion to the total number of surface  acres covered by the Leases  included
within the pooled unit bears to the total  number of surface  acres  within said
unit.


                                       6.

                                Well Information
                                ________________

     Assignee  or its  representatives  shall have access at its own risk and at
all times to the  location  and derrick  floor  during the  drilling of any well
hereunder. Each Assignee shall further be entitled to all information concerning
any well drilled hereunder and the Leases unless any such party is delinquent in
the payment of its joint interest billings to Operator for a period greater


<PAGE>


than thirty (30) days in which  event  Operator at its sole option may  withhold
any information to such delinquent party.

                                       7.

                            Area of Mutual Interest
                            _______________________

     The parties  hereto  hereby  establish an Area of Mutual  Interest  ("AMI")
which  covers  and  includes  all lands  depicted  within  the area one (1) mile
outside the  perimeter of the lands  covered by the Leases which are depicted on
the plat  attached  hereto as Exhibit  "C".  In the event that any party  hereto
hereafter  acquires an oil and gas leasehold  interest,  or contractual right to
earn an oil and gas leasehold interest, covering lands lying in whole or in part
within the AMI, the acquiring party shall, in writing,  offer to assign, without
warranty of title, to the nonacquiring parties, within ten (10) days of purchase
or acquisition, the entire proportionate interest which the nonacquiring parties
are ratably entitled to acquire within the AMI under this Agreement. Such notice
shall  include a copy of the lease or contract,  paid draft and other  pertinent
and available data. Each nonacquiring  party shall,  within ten (l0) days after
receipt of such offer,  elect  whether to purchase  such  interest by paying the
acquiring parties such  nonacquiring  party's  proportionate  part of the actual
cost and expenses,  if any,  incurred by the acquiring  party in acquiring  such
lease or  contract.  Failure  by any  nonacquiring  party to timely  notify  the
acquiring  party shall be deemed an election by such  nonacquiring  party not to
acquire  its  ratable  interest  in the  leasehold  interest  offered.  When any
nonacquiring  party  elects  not to  acquire  its  ratable  interest  from  the
acquiring party,  such  nonacquiring  party's interest in such lease or contract
which is the subject of such offer  shall be offered to the parties  electing to
acquire its proportionate share of such non-acquiring party's interest and shall
not be subject to this Agreement but an operating agreement identical to Exhibit
D, after allowing for nonjoinder by the  non-acquiring  party.  Unless otherwise
mutually agreed, this AMI shall terminate six (6) months after the expiration of
the last lease  within the AMI.  All  interests  under this  paragraph  shall be
offered on either a Before  Prospect Payout Basis or After Prospect Payout Basis
based on the occurrence of Prospect Payout.

                                       8.
                                 Prospect Payout
                                 _______________


     Upon the occurrence of "Prospect  Payout" as defined below,  Assignor shall
back-in against the interest of Assignee in the Leases for a twenty-five percent
of eight-eighths (25% of 8/8ths)


<PAGE>


working  interest  whereupon  the parties  shall own the After  Prospect  Payout
interests  set forth in Exhibit "A-l"  hereto.  All costs and expenses  incurred
prior to the  occurrence  of  Prospect  Payout  shall be borne by the parties in
accordance with their  respective  Before Prospect Payout interests set forth in
Exhibit "A-l" hereto.

"Prospect  Payout" is defined as and shall  occur at 12:01 a.m. on the first day
of the month following the day when the net proceeds received by Assignee out of
production from the Test Well and all subsequent  wells drilled on. the prospect
(after first  deducting  the  production  and severance  taxes,  and all royalty
payments effective as of the effective date of this Agreement, lessor's royalty,
overriding  royalties including,  without limitations,  the overriding royalties
reserved  by  Assignor  herein,   non-participating  royalties,  and  production
payments) shall equal the sum of Assignee's share of the:

     (a)  Initial Consideration;

     (b)  cost of land and legal  costs and all costs for  leases;  acquired  by
          Assignee  within the AMI prior to the occurrence of Prospect Payout or
          other land related costs and land maintenance costs,  geological cost,
          seismic  costs,  or  other  non-drilling  related  costs  incurred  by
          Assignee prior to Prospect Payout;

     (c)  the costs of drilling, testing,  evaluating,  completing and equipping
          the Test Well and all subsequent wells drilled on the prospect,  prior
          to Prospect  Payout into the point of sale which  includes  but is not
          limited to the wellhead, tank batteries, gathering lines and all other
          related surface equipment and facilities; and

     (d)  the operating costs, and reworking or re-completing  costs incurred on
          such wells during the payout period.

     The Operator agrees to provide all parties to this Agreement with quarterly
payout statements.


                                       9.

                                  Miscellaneous
                                  _____________

A.   Paragraph Headings

     The paragraph  headings  inserted in this Agreement are utilized solely for
reference purposes and do not constitute  substantive matter to be considered in
construing the terms of this Agreement.

B.   Time is of the Essence


<PAGE>


     It is  specifically  understood  and  agreed  that  time is of the  essence
hereunder.

C.   Liability

     It is not the purpose of this  Agreement  to create a  partnership,  mining
partnership,  partnership for a specific  purpose,  joint venture,  or any other
relationship which would render the parties liable as partners,  associates,  or
joint venturers.

D.   Entire Agreement

     This Agreement shall  constitute the entire  Agreement  between the parties
hereto  and  supersedes  any  prior   agreements,   promises,   negotiations  or
representations,  whether  written  or oral,  not  expressly  set  forth in this
Agreement.  No variations,  modifications,  or changes herein or hereof shall be
effective unless evidenced by written document executed by the parties hereto.

E.   Counterparts

     This  Agreement  may be  executed  in any number of  counterparts  and each
counterpart  so executed  shall be deemed an original for all purposes and shall
be binding  upon each  party  executing  same  whether  or not  executed  by all
parties.

F.   Governing Law

     This Agreement shall be governed by the laws of the State of Texas.


G.   Binding Agreement

     The terms,  covenants  and  conditions of this  Agreement  shall be binding
upon,  and shall  inure to the  benefit  of,  the  parties  hereto  and to their
respective heirs,  executors,  administrators,  successors and assigns, and such
terms,  covenants and conditions  shall be deemed as covenants  running with the
lands and leases covered hereby. It is stipulated,  however,  that no assignment
or  transfer  by or,  however  accomplished,  of any  right,  title or  interest
acquired  hereunder  shall  relieve such party of any  liability  or  obligation
herein assumed, except with written consent of the other party.

H.   Acceptance

     If the  foregoing  fully sets forth your  understanding  of our  agreement,
please so indicate by execution in the space provided


<PAGE>


below and return one (1) fully executed original hereof together with your share
of the Initial  Consideration  described in Section 1. hereof. If this Agreement
is not accepted and returned  within fifteen (15) days from the date hereof with
your share of the Initial Consideration, this Agreement shall be voidable by any
party and such shares of Initial Consideration shall be returned promptly to the
Assignee.

I.   Delivery of Assignment

     With   Assignee's   tendering  of  its   pro-rata   share  of  the  Initial
Consideration and its pro-rata share of the Estimated Dry Hole Costs as provided
herein,  Assignor  shall upon  request  provide  Assignee  with  complete  lease
purchase  packages for the Leases.  Assignor  shall record an  assignment of the
Leases to the  Assignee and upon receipt  provide  Assignee with a copy of such
recorded assignment.

J.   Notices

     All notices  required under this agreement  shall be made to the parties at
the addresses and fax numbers identified in Exhibit "A".

K.   Well Data Requirements

     Assignor  shall provide or cause to be provided  certain well data required
by Assignee in all wells in which Assignee is a participant.  Such  requirements
will be fully identified under separate cover.

L.   Delay Rental Payments

     Any and all delay rental payments shall be paid by Assignor and invoiced to
Assignee based on it current working  interest.  Delay rentals accruing (if any)
prior  to  reaching  casing  point  in the Test  Well  shall be a  proportionate
obligation  on the part of all parties;  however after such a time same shall be
the subject of future recommendations and elections.

                                            Very truly yours,

                                            SKYLINE ENERGY, L.L.C.


                                            By: /s/ DONNIE JONES
                                                ___________________________
                                                    Donnie Jones, President


<PAGE>


AGREED TO AND ACCEPTED THIS

8th DAY OF September  2005

Pin Petroleum Partners Inc.

By:  /s/ WILLIAM FRIESEN
_______________________________
Name: _________________________
Title: ________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

G-White

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

Oakwood Energy, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________DAY OF_________, 2005

Stardust Energy, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

Blake Cmajadalka

By:____________________________
Name:__________________________
Title:_________________________


<PAGE>


AGREED TO AND ACCEPTED THIS
________DAY OF _________, 2005

Miller Resources, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________DAY OF_________, 2005

By:____________________________
Name:__________________________
Title:_________________________


<PAGE>


                                   EXHIBIT "A"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL

                                   ADDRESSEES


Pin Petroleum Partners Inc.
Suite 2410, 650 West Georgia Street
P. O. Box 11524
Vancouver, British Columbia, Canada, V6B 4N7
Telephone: 604-689-8336
Telecopy: 604-682-5564


Oakwood Energy, INC.
P. O. Box 297
Jourdanton, Texas 78026
Attention: Barry Laidlaw
Telephone: 830-769-3955
Telecopy:  830-769-2261

Miller Resources, Inc.
P. O. Box 2128
Traverse City, MI 49685-2128
Attn: John Miller
Telephone: 231-941-0073
Telecopy:

Stardust Energy, Inc.
Attention: Don Shepherd
P 0 Box 150909
Austin, Texas 78715
Telephone: 281-685-9917
Telecopy:

Blake Cmajdalka
2415 Hanston Ct.
Pearland Texas, 77584
Telephone: Telecopy:

Skyline Energy, LLC
2301 Dublin Circle
Pearland, Texas 77581
Attn: Donnie Jones
Telephone:  281-481-0881
Telecopy:  281-481-5645


<PAGE>

<TABLE>
<CAPTION>


                                  EXHIBIT "A-l"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED August 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL


 Party                          Before Prospect Payout       After Prospect Payout              Initial
                                Interest                    Interest                         Consideration
__________________________________________________________________________________________________________
<S>                                    <C>                        <C>                         <C>
 Pin Petroleum                         30.00%                     22.500%                     $58,500.00
 Partners Inc.
__________________________________________________________________________________________________________
 G-White                                5.00%                      3.750%                      $9,750.00
__________________________________________________________________________________________________________
 Oakwood Energy, Inc .                  2.00%                      1.500%                      $3,900.00
__________________________________________________________________________________________________________
 Miller Energy, Inc .                   2.00%                     1.500%                       $3,900.00
__________________________________________________________________________________________________________
 Stardust Energy, Inc .                 1.50%                      1.125%                      $2,925.00
__________________________________________________________________________________________________________
 Blake Cmajakaika                       1.00%                       .750%                      $1,950.00
__________________________________________________________________________________________________________
 Skyline Energy, L.L.C.               58.500%                     68.875%                         NA
 Etal
__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________
 Total                                  100%                        100%
__________________________________________________________________________________________________________

</TABLE>


<PAGE>


                                  EXHIBIT "A-2"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                             DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL



                     AFE TO BE FURNISHED BY MLC OPERATING LP





<PAGE>


                                   EXHIBIT "B"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                  PARTICIPATION AGREEMENT DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL




                                   THE LEASES

1.   Oil, Gas and Mineral Lease dated, September 20, 2004 by and between, Donald
     L. Dick, et ux, as Lessor, and Skyline Energy, L.L.C., as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and  recorded in Volume  __________________________,  Page  ________,  Deed
     Records, Cherokee County, Texas.

2.   Oil, Gas and Mineral Lease dated,  September 29, 2004 , by and between Mary
     John Spence  Trust I & II , as  Lessors,  and Skyline  Energy,  L.L.C.,  as
     Lessee,  covering  certain  lands  in the  Joseph  Merrill  Survey,  A-564,
     Cherokee      County,      Texas,      and      recorded      in     Volume
     _______________________________,  Page  _________ , Deed Records,  Cherokee
     County, Texas.

3.   Oil, Gas and Mineral Lease dated,  October 1, 2004, by and between  Michael
     Theron Ragsdale, as Lessor, and Skyline Energy, L.L.C, as Lessee,  covering
     certain lands in the Joseph Merril Survey,  A-564,  Cherokee County, Texas,
     and recorded in Volume  ___________________________,  Page  ________,  Deed
     Records, Cherokee County, Texas.

4.   Oil, Gas and Mineral  Lease  dated,  October 1, 2004,  by and between,  Sue
     Ragsdale Smith as Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Survey,  A-, Cherokee  County,  Texas, and recorded in
     Volume_____, Page _____, Deed Records, Cherokee County, Texas

5.   Oil, Gas and Mineral Lease dated,  October  1,2004,  by and between,  Julie
     Ragsdale Young, as Lesser, and Skyline Energy,  L.L.C, as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and  recorded  in Volume ,  Page____________________________________,  Deed
     Records, Cherokee County, Texas .

6.   Oil, Gas and Mineral  Lease  dated,  October 1, 2004,  by and between,  Amy
     Ragsdale Duncan, as Lessor, and Skyline Energy, L.L.C, as Lessee,  covering
     certain lands in the Joseph Merril1 Survey, A-5 64, Cherokee County, Texas,
     and recorded in Volume  __________________________  , Page __________, Deed
     Records, Cherokee County, Texas.

7.   Oil, Gas and Mineral Lease dated,  October 1, 2004, by and between,  Edward
     Baxter Ragsdale, as Lessor, and Skyline Energy, L.L.C, as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and  recorded in Volume 169 8, Page 192,  Deed  Records,  Cherokee  County,
     Texas.

8.   Oil, Gas and Mineral Lease dated,  October 1, 2 004, by and between,  Karen
     Ragsdale  Reininger,  as Lessor,  and  Skyline  Energy,  L.L.C,  as Lessee,
     covering  certain  lands in the  Joseph  Merrill  Survey,  A-564,  Cherokee
     County,  Texas,  and recorded in Volume  __________________________  , Page
     __________, Deed Records, Cherokee County, Texas.


9.   Oil, Gas and Mineral Lease dated,  October 1, 2004, by and between,  Baxter
     A. Ragsdale,  as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and recorded in Volume  __________________,  Page _______,  Deed.  Records,
     Cherokee County, Texas.


<PAGE>


10.  Oil, Gas and  Mineral Lease dated,  October 4,  2004,  by and  between  Sue
     Ragsdale Bean, as Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and recorded in  Volume___________________,  Page_________,  Deed  Records,
     Cherokee County, Texas.

11.  Oil, Gas and Mineral Lease dated, October 4, 2004, by and between, Amy Bean
     Mellin, as Lessor, and Skyline Energy, L.L.C., as Lessee,  covering certain
     lands in the Joseph Merrill Survey,  A-564,  Cherokee  County,  Texas,  and
     recorded  in   Volume___________________,   Page  ________,  Deed  Records,
     Cherokee County, Texas.

12.  Oil, Gas and Mineral Lease dated,  October 4, 2004,  by and  between,  Clay
     Arnold Bean, as Lessors,  and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and  recorded in  Volume__________________,  Page_________,  Deed  Records,
     Cherokee County, Texas.

13.  Oil, Gas and Mineral Lease dated,  October 15, 2004, by and between,  H. D.
     Industries Inc., as Lessor, and Skyline Energy, L.L.C., as Lessee, covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and recorded in Volume  __________________________  , Page __________, Deed
     Records, Cherokee County, Texas.

14.  Oil,  Gas and Mineral  Lease dated,  October 18, 2004 by and between,  Jean
     Haberle Coley, as Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and  recorded  in   Volume_______________________,   Page  _________,  Deed
     Records, Cherokee County, Texas.

15.  011, Gas and Mineral Lease dated,  October 18, 2004, by and between, Janet
     G. Holley,  as Lessor,  and Skyline  Energy,  L.L.C.,  as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and recorded in Volume  __________________  Page__________,  Deed  Records,
     Cherokee County, Texas."

16.  011, Gas and Mineral Lease dated, November 4, 2004 by and between,  William
     M. Withers dec'd, rep. by Hugh L. McCulley,  as Lessor, and Skyline Energy,
     L.L.C., as Lessee,  covering certain lands in the Joseph Merrill Survey, A-
     564,     Cherokee     County,     Texas,    and    recorded    in    Volume
     _____________________________  ,  Page  ________,  Deed  Records,  Cherokee
     County, Texas.

17.  Oil, Gas and Mineral  Lease dated,  January 13, 2005 by and between,  Drake
     Sales,  Inc., as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Drury Earle Survey, A-260, Cherokee County, Texas, and
     recorded  in  Volume  __________________,   Page  ________,  Deed  Records,
     Cherokee County, Texas.

18.  Oil, Gas and Mineral Lease dated,  January 13, 2005, by and between,  Ellis
     Lynn  Cook,  et ux, as  Lessor,  and  Skyline  Energy,  L.L.C.,  as Lessee,
     covering  certain  lands in the Isaac  Reynolds  Survey,  A-72 8,  Cherokee
     County,     Texas,     and     recorded     in    Volume    __    ,    Page
     __________________________________, Deed Records, Cherokee County, Texas.

19.  Oil, Gas and Mineral Lease dated, January 14, 2005, by and between, Jack W.
     Powell et ux, as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Issac Reynolds Survey,  A-728, Cherokee County, Texas,
     and recorded in Volume  ___________________________,  Page _________,  Deed
     Records, Cherokee County, Texas.


<PAGE>


20.  Oil, Gas and Mineral Lease dated, January 31, 2005, by and between,  Bessie
     Lorene & John R.  Ragsdale,  as Lessor,  and  Skyline  Energy,  L.L.C.,  as
     Lessee,  covering  certain  lands  in the  Issac  Reynolds  Survey,  A-728,
     Cherokee      County,      Texas,      and      recorded      in     Volume
     _________________________________,  Page _________,  Deed Records, Cherokee
     County, Texas.

21.  Oil, Gas and Mineral Lease dated, February 14, 2005, by and between, Dannie
     R.  McDaniel,  et ux, as Lessor,  and Skyline  Energy,  L.L.C.,  as Lessee,
     covering  certain  lands in the  Issac  Reynolds  Survey,  A-728,  Cherokee
     County,  Texas,  and recorded in Volume  _________________________________,
     Page ________, Deed Records, Cherokee County, Texas.

22.  Oil, Gas and Mineral Lease dated, February 14, 20C5, by and between, Dannie
     R. McDaniel,  his wife,  Deborah K. McDaniel and Arlene Bailey,  as Lessor,
     and Skyline Energy, L.L.C., as Lessee,  covering certain lands in the Issac
     Reynolds  Survey,  A-728,  Cherokee  County,  Texas, and recorded in Volume
     ________, Page _______, Deed Records, Cherokee County, Texas.

23.  Oil, Gas and Mineral Lease dated, March 8, 2005, by and between, Charles A.
     Gudermuth, individually and as Independent Executor of the Estate of Beulah
     Gudermuth,  Deceased,  as Lessor,  and Skyline Energy,  L.L.C.,  as Lessee,
     covering  certain  lands in the  Joseph  Merrill  Survey,  A-564,  Cherokee
     County,  Texas,  and recorded in Volume  _______________________________  ,
     Page __________, Deed Records, Cherokee County, Texas.

24.  Oil, Gas and Mineral Lease dated, March 9, 2005, by and between, Mr. & Mrs.
     Ray Neil Earle, as Lessor, and Skyline Energy, L.L.C., as Lessee,  covering
     certain lands in the Joseph Merrill Survey,  A-564, Cherokee County, Texas,
     and recorded in Volume  ___________________________,  Page __________, Deed
     Records, Cherokee County, Texas.

25.  0il, Gas and Mineral Lease dated,  March 9, 2005,  by and between,  Earle's
     Chapel Cemetary  Association,  as Lessor,  and Skyline Energy,  L.L.C.,  as
     Lessee,  covering  certain  lands  in the  Joseph  Merrill  Survey,  A-564,
     Cherokee        County,         Texas,        and        recorded        in
     Volume__________________________________Page   ___________,  Deed  Records,
     Cherokee County, Texas.

26.  Oil Gas and Mineral Lease dated, April 1, 2005, by and between,  Barbara J.
     Earle, as Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the  Drury  Earle  Survey,  A-260,  Cherokee  County,  Texas,  and
     recorded  in   Volume__________________,   Page__________,   Deed  Records,
     Cherokee County, Texas.

27.  Oil, Gas and Mineral Lease dated,  April 20, 2005, by and between,  Jack D.
     Earle, as Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the  Drury  Earle  Survey,  A-260,  Cherokee  County,  Texas,  and
     recorded in Volume  _____________,  Page ________,  Deed Records,  Cherokee
     County, Texas.

28.  Oil, Gas and Mineral  Lease dated,  April 25,  2005,  by and between,  Gary
     Mims, as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the  Drury  Earle  Survey,  A-260,  Cherokee  County,  Texas,  and
     recorded in Volume _____________ , Page _________,  Deed Records,  Cherokee
     County, Texas.

29.  Oil, Gas and Mineral Lease dated,  April 27, 2005, by and between,  Jack N.
     Reynolds Jr. & Wife,  Deborah,  as Lessor,  and Skyline Energy,  L.L.C., as
     Lessee,  covering  certain  lands  in the  Joseph  Merrill  Survey,  A-564,
     Cherokee      County,      Texas,      and      recorded      in     Volume
     ________________________________,  Page  ._______,  Deed Records,  Cherokee
     County, Texas.

30.  Oil, Gas and Mineral Lease dated, April 20, 2005, by and between,  Ray Neil
     Earle, as Lessor, and Skyline Energy,  L.L.C., as Lessee, covering certain
     lands in the  Drury  Earle  Survey,  A-260,  Cherokee  County,  Texas,  and
     recorded in Volume  _____________,  Page ________,  Deed Records,  Cherokee
     County, Texas.



<PAGE>


31.  Oil, Gas and Mineral Lease dated,  April 19, 2005, by and between,  Barbara
     Mims Lewis, as Lessor,  and Skyline  Energy,  L.L.C.,  as Lessee,  covering
     certain lands in the Drury Earle Survey, A-260, Cherokee County, Texas, and
     recorded  in   Volume___________________,   Page  ________,  Deed  Records,
     Cherokee County, Texas.

32.  Oil, Gas and Mineral Lease dated,  April 20, 2005, by and between,  Virgina
     E. Osborne,  as Lessor,  and Skyline Energy,  L.L.C.,  as Lessee,  covering
     certain lands in the Drury Earle Survey, A-564, Cherokee County, Texas, and
     recorded  in   Volume___________________,   Page  ________,  Deed  Records,
     Cherokee County, Texas.

33.  Oil, Gas and Mineral Lease dated, April 20, 2 005, by and between.  Jack C.
     Earle, as Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the  Drury  Earle  Survey,  A-260,  Cherokee  County,  Texas,  and
     recorded in Volume  _____________ , Page_________,  Deed Records,  Cherokee
     County, Texas.

34.  Oil, Gas and Mineral  Lease dated,  April 20, 2005,  by and between,  Betty
     Earle Raines,  et ux, as Lessor,  and Skyline  Energy,  L.L.C.,  as Lessee,
     covering certain lands in the Drury Earle Survey,  A-260,  Cherokee County,
     Texas, and recorded in Volume_______________________,  Page _________, Deed
     Records, Cherokee County, Texas.

35.  Oil, Gas and Mineral  Lease dated,  April 25,  2005,  by and between,  Mary
     Virginia Bowery, as Lessor, and Skyline Energy, L.L.C., as Lessee, covering
     certain lands in the Drury Earle Survey, A-260, Cherokee County, Texas, and
     recorded  in  Volume_______________________,  Page___________Deed  Records,
     Cherokee County, Texas.

36.  Oil, Gas and Mineral Lease dated, April 25, 2 005, by and between,  Charles
     Mitchell Earle, as Lesser, and Skyline Energy, L.L.C., as Lessee,  covering
     certain lands in the Drury Earle Survey, A-260, Cherokee County, Texas, and
     recorded  in   Volume___________________,   Page_________,   Deed  Records,
     Cherokee County, Texas.

37.  Oil, Gas and Mineral  Lease dated,  May 2, 2005,  by and between,  Bobby D.
     Mims, as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the  Drury  Earle  Survey,  A-260,  Cherokee  County,  Texas,  and
     recorded in Volume  _____________,  Page ________,  Deed Records,  Cherokee
     County, Texas.


<PAGE>


                                   EXHIBIT "C"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                             DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL



                                  [Attach Plat]


<PAGE>


            [Junction Prospect Cherokee Co., Texas Map Appears Here]




<PAGE>


                                   EXHIBIT "D"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL






                     JOA TO BE FURNISHED BY MLC OPERATING LP






<PAGE>


                                  SCHEDULE "B"
                                  ____________

                              SKYLINE ENERGY, LLC
                               2301 Dublin Circle
                             Pearland, Texas 77581
                      Tele: 281-481-0881 Fax: 281-481-5645

                                August 24, 2005


See Exhibit "A" for Addressees

                              Re: Northwest Jacksonville Prospect
                                  Cherokee County, Texas
                                  (the "Prospect")


     This agreement (hereinafter referred to as "Agreement") is made and entered
into by and between Skyline Energy,  L.L.C.,  who address is 2301 Dublin Circle,
Pearland,  Texas 77581 (hereinafter referred to as "Assignor") and the signatory
parties  identified on Exhibit "A" and "A-l" relative to the leasehold  interest
more fully described in Exhibit "B" attached hereto and incorporated  herein for
all purposes,  (hereinafter singularly referred to as "Assignee" or collectively
as  "Assignees").  Subject to elections made to the contrary,  it is agreed that
all rights and benefits as well as all risks,  costs and expenses granted herein
unto  Assignees  shall be owned and borne by each Assignee in the percentage set
forth next to his name in Exhibit "A-l" hereto.

     Assignor  represents  that it is the present owner of all right,  title and
interest  in and to the oil and gas leases more fully  described  in Exhibit "B"
attached hereto and incorporated herein for all purposes.  Said leases cover 350
+- gross,  more or less,  out of the Jose Pineda West Four League Grant  Survey,
A-40,  Cherokee County,  Texas  (hereinafter  referred to as the "Leases").  The
Leases cover the lands shaded yellow on the plat attached  hereto as Exhibit "C"
which is incorporated herein for all purposes.

     Assignee is desirous of  acquiring  from  Assignor the  undivided  interest
herein described in the Leases and participating in the drilling of a Test Well,
as defined  below,  for oil and gas  thereon  subject to the terms,  conditions,
reservations  and limitations  herein provided.  The parties  therefore agree as
follows:

With respect to the Leases, Assignor represents and warrants to Assignee that:


<PAGE>


     1.   Assignor owns each of the Leases free and clear of any liens, security
          interests or encumbrances of any kind placed thereon by Assignor.

     2.   To the best of Assignor's knowledge,  the Leases are in full force and
          effect,  are valid and  subsisting  leases,  and all rentals and other
          payments due under the Leases have been properly and timely paid,  and
          all  conditions  necessary to keep the Leases in force have been fully
          performed.

     3.   To the  best  of  Assignor's  knowledge,  no  suit,  action  or  other
          proceeding is pending before any court or  governmental  agency and no
          cause of action exists that relates to the Leases or that might result
          in  impairment  or loss of  Assignee's  title  to any  portion  of the
          Leases.


                                       1.

                                  Consideration
                                  _____________

     For and in consideration of the sums set. forth herein,  Assignor agrees to
assign,  in accordance with Section 9.I. below,  and with warranty of title, by,
through and under Assignor, but not otherwise, and further subject to the terms,
reservations  and conditions of this  Agreement,  the leasehold  interest in the
Leases to each  Assignee in the  proportions  set forth in Exhibit  "A-l" beside
Assignee's name; provided, however, as a condition precedent to such assignment,
Assignee  shall  have  paid  to  Assignor  its pro  rata  share  of the  Initial
Consideration,  defined as eight  eighths  (8/8ths)  of the cost of the  Leases,
legal fees, and geological and administrative costs through the date hereof, and
which is set forth on Exhibit "A-l" hereto,  and its pro rata share of Estimated
Dry Hole Costs, as hereinafter defined.  The Initial  Consideration is comprised
of the following sums:

          Land and Legal Costs
          Geological and Administrative Costs to Date  $170,000.00
                                                       ___________
          Total Initial Consideration                  $170,000.00
                                                       ===========

     It is  further  agreed  that  attached  hereto as  Exhibit  "A-2"  which is
incorporated  herein for all purposes is an Authority  for  Expenditure  ("AFE")
which sets forth the estimated  costs  necessary to drill the Test Well to Total
Depth,  evaluate same with a triple combination log and plug and abandon same if
a dry hole  ("Estimated  Dry  Hole  Costs").  By  execution  of this  Agreement,
Assignor and Assignee do each agree to bear and pay their respective share of


<PAGE>


the Estimated Dry Hole Costs of the Test Well.  Such actual drilling costs which
shall include, without limitation, surface damage and restoration costs.

Assignee  agrees  to bear  and pay for  their  proportionate  share  {Assignee's
"Before Prospect Payout Interest") of the costs associated with the drilling and
development of the prospect before Prospect Payout as hereinafter  defined,  and
their  proportionate  share (Assignee's "After Prospect Payout Interest") of the
costs  associated  with the  prospect  after  Prospect  Payout,  as  hereinafter
defined.

Operator  shall notify each Assignee of the estimated spud date of the Test Well
and request the advance  payment of Assignee's  Estimated  Dry Hole Costs.  Each
Assignee  shall  advance to Operator its share of the  Estimated  Dry Hole Costs
within fifteen (15) days from the date of receipt of said  notification.  Should
any  party  fail or  refuse  to  timely  forward  to  Operator  its share of the
Estimated  Dry Hole Costs  within said fifteen  (15) day period,  then  Operator
shall notify such party by certified  mail that it is  delinquent in making such
payment. It is understood that Operator shall not request the advance payment of
the  Estimated  Dry Hole  Costs  prior to  thirty  (30) days in  advance  of the
estimated spud date of the Test Well.

     Should any Assignee  fail to pay Operator  its share of the  Estimated  Dry
Hole Costs,  such Assignee shall further forfeit its right to participate in the
drilling of the Test Well and this  Agreement  shall be of no further  force and
effect with respect to such  forfeiting  Assignee  whereupon such Assignee shall
forfeit,  as liquidated  damages and not as a penalty,  its share of the Initial
Consideration previously paid to Assignor hereunder.

     Notwithstanding any terms contained in this Agreement to the contrary, upon
payment of the Initial  Consideration  by Assignee to Assignor,  Assignor  shall
have no  liability  to any  Assignee or to  Operator  in the event any  Assignee
subsequently fails to fund its share of the Estimated Dry Hole Costs;  provided,
however,  should another party fail to fund the Initial Consideration  resulting
in the failure of the Test Well to be drilled to total depth, Assignor agrees it
will   promptly   refund   Assignee's   share  of  the  Initial   Consideration.
Additionally,  except as otherwise provided in the Operating Agreement, Assignor
shall have no liability to Assignee for any acts or omissions of Operator in any
way associated with the drilling of the Test Well or any other well which may be
drilled under the terms of this Agreement.

In the event that Operator does not commence actual drilling  operations for the
Test Well on or before  February 28, 2 005, this Agreement  shall  terminate and
Assignor  shall  immediately  refund  the  Initial  Consideration  to  Assignee;
provided, however, the


<PAGE>


commencement date for the Test Well shall be extended in the event the Test Well
is not timely spudded due to delays caused by the drilling contractor. In the
event this Agreement terminates, Assignee shall have no obligation with respect
to any costs or liabilities incurred by Assignor with respect to this Agreement
and Operator agrees to indemnify and hold Assignee harmless against any and all
costs, expenses, claims, demands and causes of action of whatsoever kind or
character, including court costs and attorneys' fees, arising out of any
operations conducted, commitment made or any action taken or omitted with
respect to the Leases in the event the Test Well is not timely spudded by the
Operator as herein provided.
                                       2.

                                    Test Well
                                    _________

     On or before February 28, 2006,  MLC Operating LP, as initial operator
(the  "Operator"),  shall  commence  operations  for the drilling of a test well
(hereinafter  referred  to as the "Test  Well") at a  location  on the Leases as
designated  on the  AFE,  and  shall  thereafter  diligently  and in a good  and
workmanlike  manner  proceed  to cause  the  drilling  of the  Test  Well to the
stratigraphic  equivalent of the lesser of either (i) a true  vertical  depth of
approximately  5,000  feet  beneath  the  surface  of the  earth or (ii) a depth
sufficient  to test the upper  Woodbine  Sands as seen at a depth  sufficient to
test the  upper  Woodbine  Sands as seen at a depth  of  4,790'  to 4912' in the
Feldman Oil & Gas #1  McDonald,  Total Depth 5155'  (hereinafter  referred to as
"Total Depth");  provided,  however,  Assignor may at its sole option extend the
Test Well commencement date subject to rig availability.


                                       3.

                                 Substitute Well
                                 _______________

     In the event the Test Well is lost or junked due to mechanical  difficulty,
or there is encountered in the drilling thereof salt,  domal formation,  cavity,
igneous rock,  heaving  shale,  high pressure gas,  saltwater flow or such other
conditions  which render further  drilling  impracticable,  unduly  difficult or
expensive by ordinary standards of the oil industry, then in lieu of drilling to
Total Depth,  Assignees,  for a period of ninety (90) days after abandoning said
Test  Well,  for any of the  reasons  above  noted,  shall  have the  option  to
commence,  or cause to be commenced,  actual drilling of a substitute well. Such
well shall be drilled at a mutually  acceptable  location,  in a like manner and
under the same terms and  conditions  to the depth  specified for the Test Well,
and the term "Test  Well" as used  herein  shall be  construed  to  include  any
substitute well drilled under the terms of this Agreement; provided, however, in
the event Assignee does not elect to


<PAGE>


participate  in  the  substitute  well,   Assignee  shall  forfeit  the  Initial
Consideration previously paid to Assignor.


                                       4.

                               Operating Agreement
                               ___________________


         Except as otherwise set forth herein, all operations on the lands
covered by the Leases shall be conducted in accordance with the terms of this
Agreement and the Operating Agreement attached as Exhibit "D" which designates
Oakwood Energy, INC. as operator and which is executed contemporaneously
herewith. In the event of a conflict between the terms of this Agreement and the
Operating Agreement, the terms of this Agreement shall prevail and control.


                                       5.

                               Overriding Royalty
                               __________________


     It is agreed and understood that Assignor  hereby reserves unto itself,  or
its designees,  an overriding  royalty burdening the lands covered by the Leases
equal to twenty-five  percent (25%) less presently  existing  leasehold  burdens
thereby  delivering  Assignee  its pro rata share of a  seventy-five  percent of
eight-eights (75% of 8/8ths) net revenue interest.

     In the event any of the  Leases do not cover a full  mineral  interest,  or
Assignor does not own the full leasehold  interest therein,  then the overriding
royalty herein reserved shall be proportionately  reduced.  Furthermore,  should
any of the Leases cover less than all of the lands included within a pooled unit
allocated  to any well drilled  pursuant to the terms  hereof,  such  overriding
royalty  reserved  by  Assignor  herein  shall be  further  reduced  and paid in
proportion to the total number of surface  acres covered by the Leases  included
within the pooled unit bears to the total  number of surface  acres  within said
unit.


                                       6.

                                Well Information
                                ________________

     Assignee  or its  representatives  shall have access at its own risk and at
all times to the  location  and derrick  floor  during the  drilling of any well
hereunder. Each Assignee shall further be entitled to all information concerning
any well drilled hereunder and the Leases unless any such party is delinquent in
the payment of its joint interest billings to Operator for a period greater


<PAGE>


than thirty (30) days in which  event  Operator at its sole option may  withhold
any information to such delinquent party.

                                       7.

                            Area of Mutual Interest
                            _______________________

     The parties  hereto  hereby  establish an Area of Mutual  Interest  ("AMI")
which  covers  and  includes  all lands  depicted  within  the area one (1) mile
outside the  perimeter of the lands  covered by the Leases which are depicted on
the plat  attached  hereto as Exhibit  "C".  In the event that any party  hereto
hereafter  acquires an oil and gas leasehold  interest,  or contractual right to
earn an oil and gas leasehold interest, covering lands lying in whole or in part
within the AMI, the acquiring party shall, in writing,  offer to assign, without
warranty of title, to the nonacquiring parties, within ten (10) days of purchase
or acquisition, the entire proportionate interest which the nonacquiring parties
are ratably entitled to acquire within the AMI under this Agreement. Such notice
shall  include a copy of the lease or contract,  paid draft and other  pertinent
and available data. Each nonacquiring  party shall,  within ten (l0) days after
receipt of such offer,  elect  whether to purchase  such  interest by paying the
acquiring parties such  nonacquiring  party's  proportionate  part of the actual
cost and expenses,  if any,  incurred by the acquiring  party in acquiring  such
lease or  contract.  Failure  by any  nonacquiring  party to timely  notify  the
acquiring  party shall be deemed an election by such  nonacquiring  party not to
acquire  its  ratable  interest  in the  leasehold  interest  offered.  When any
nonacquiring  party  elects  not to  acquire  its  ratable  interest  from  the
acquiring party,  such  nonacquiring  party's interest in such lease or contract
which is the subject of such offer  shall be offered to the parties  electing to
acquire its proportionate share of such non-acquiring party's interest and shall
not be subject to this Agreement but an operating agreement identical to Exhibit
D, after allowing for nonjoinder by the  non-acquiring  party.  Unless otherwise
mutually agreed, this AMI shall terminate six (6) months after the expiration of
the last lease  within the AMI.  All  interests  under this  paragraph  shall be
offered on either a Before  Prospect Payout Basis or After Prospect Payout Basis
based on the occurrence of Prospect Payout.

                                       8.
                                 Prospect Payout
                                 _______________


     Upon the occurrence of "Prospect  Payout" as defined below,  Assignor shall
back-in against the interest of Assignee in the Leases for a twenty-five percent
of eight-eighths (25% of 8/8ths)


<PAGE>


working  interest  whereupon  the parties  shall own the After  Prospect  Payout
interests  set forth in Exhibit "A-l"  hereto.  All costs and expenses  incurred
prior to the  occurrence  of  Prospect  Payout  shall be borne by the parties in
accordance with their  respective  Before Prospect Payout interests set forth in
Exhibit "A-l" hereto.

"Prospect  Payout" is defined as and shall  occur at 12:01 a.m. on the first day
of the month following the day when the net proceeds received by Assignee out of
production from the Test Well and all subsequent  wells drilled on. the prospect
(after first  deducting  the  production  and severance  taxes,  and all royalty
payments effective as of the effective date of this Agreement, lessor's royalty,
overriding  royalties including,  without limitations,  the overriding royalties
reserved  by  Assignor  herein,   non-participating  royalties,  and  production
payments) shall equal the sum of Assignee's share of the:

     (a)  Initial Consideration;

     (b)  cost of land and legal  costs and all costs for  leases;  acquired  by
          Assignee  within the AMI prior to the occurrence of Prospect Payout or
          other land related costs and land maintenance costs,  geological cost,
          seismic  costs,  or  other  non-drilling  related  costs  incurred  by
          Assignee prior to Prospect Payout;

     (c)  the costs of drilling, testing,  evaluating,  completing and equipping
          the Test Well and all subsequent wells drilled on the prospect,  prior
          to Prospect  Payout into the point of sale which  includes  but is not
          limited to the wellhead, tank batteries, gathering lines and all other
          related surface equipment and facilities; and

     (d)  the operating costs, and reworking or re-completing  costs incurred on
          such wells during the payout period.

     The Operator agrees to provide all parties to this Agreement with quarterly
payout statements.


                                       9.

                                  Miscellaneous
                                  _____________

A.   Paragraph Headings

     The paragraph  headings  inserted in this Agreement are utilized solely for
reference purposes and do not constitute  substantive matter to be considered in
construing the terms of this Agreement.

B.   Time is of the Essence


<PAGE>


     It is  specifically  understood  and  agreed  that  time is of the  essence
hereunder.

C.   Liability

     It is not the purpose of this  Agreement  to create a  partnership,  mining
partnership,  partnership for a specific  purpose,  joint venture,  or any other
relationship which would render the parties liable as partners,  associates,  or
joint venturers.

D.   Entire Agreement

     This Agreement shall  constitute the entire  Agreement  between the parties
hereto  and  supersedes  any  prior   agreements,   promises,   negotiations  or
representations,  whether  written  or oral,  not  expressly  set  forth in this
Agreement.  No variations,  modifications,  or changes herein or hereof shall be
effective unless evidenced by written document executed by the parties hereto.

E.   Counterparts

     This  Agreement  may be  executed  in any number of  counterparts  and each
counterpart  so executed  shall be deemed an original for all purposes and shall
be binding  upon each  party  executing  same  whether  or not  executed  by all
parties.

F.   Governing Law

     This Agreement shall be governed by the laws of the State of Texas.


G.   Binding Agreement

     The terms,  covenants  and  conditions of this  Agreement  shall be binding
upon,  and shall  inure to the  benefit  of,  the  parties  hereto  and to their
respective heirs,  executors,  administrators,  successors and assigns, and such
terms,  covenants and conditions  shall be deemed as covenants  running with the
lands and leases covered hereby. It is stipulated,  however,  that no assignment
or  transfer  by or,  however  accomplished,  of any  right,  title or  interest
acquired  hereunder  shall  relieve such party of any  liability  or  obligation
herein assumed, except with written consent of the other party.

H.   Acceptance

     If the  foregoing  fully sets forth your  understanding  of our  agreement,
please so indicate by execution in the space provided


<PAGE>


below and return one (1) fully executed original hereof together with your share
of the Initial  Consideration  described in Section 1. hereof. If this Agreement
is not accepted and returned  within fifteen (15) days from the date hereof with
your share of the Initial Consideration, this Agreement shall be voidable by any
party and such shares of Initial Consideration shall be returned promptly to the
Assignee.

I.   Delivery of Assignment

     With   Assignee's   tendering  of  its   pro-rata   share  of  the  Initial
Consideration and its pro-rata share of the Estimated Dry Hole Costs as provided
herein,  Assignor  shall upon  request  provide  Assignee  with  complete  lease
purchase  packages for the Leases.  Assignor  shall record an  assignment of the
Leases to the  Assignee and upon receipt  provide  Assignee with a copy of such
recorded assignment.

J.   Notices

     All notices  required under this agreement  shall be made to the parties at
the addresses and fax numbers identified in Exhibit "A".

K.   Well Data Requirements

     Assignor  shall provide or cause to be provided  certain well data required
by Assignee in all wells in which Assignee is a participant.  Such  requirements
will be fully identified under separate cover.

L.   Delay Rental Payments

     Any and all delay rental payments shall be paid by Assignor and invoiced to
Assignee based on it current working  interest.  Delay rentals accruing (if any)
prior  to  reaching  casing  point  in the Test  Well  shall be a  proportionate
obligation  on the part of all parties;  however after such a time same shall be
the subject of future recommendations and elections.

                                            Very truly yours,

                                            SKYLINE ENERGY, L.L.C.


                                            By: /s/ DONNIE JONES
                                                ___________________________
                                                    Donnie Jones, President


<PAGE>


AGREED TO AND ACCEPTED THIS

8th DAY OF September  2005

Pin Petroleum Partners Inc.

By: /s/ WILLIAM FRIESEN
_______________________________
Name: _________________________
Title: ________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

G-White

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

Oakwood Energy, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________DAY OF_________, 2005

Stardust Energy, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

Blake Cmajadalka

By:____________________________
Name:__________________________
Title:_________________________


<PAGE>


AGREED TO AND ACCEPTED THIS
________DAY OF _________, 2005

Miller Resources, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________DAY OF_________, 2005

By:____________________________
Name:__________________________
Title:_________________________


<PAGE>


                                   EXHIBIT "A"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED MAY 23, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL

                                   ADDRESSEES


Pin Petroleum Partners Inc.
Suite 2410, 650 West Georgia Street
P. O. Box 11524
Vancouver, British Columbia, Canada, V6B 4N7
Telephone: 604-689-8336
Telecopy: 604-682-5564

G-White Investments
6524 Riverhill Dr.
Plano, Texas 75024
Attention: Glen Gee
Telephone: 469-384-4834
Telecopy:

Oakwood Energy, INC.
P. O. Box 297
Jourdanton, Texas 78026
Attention: Barry Laidlaw
Telephone: 830-769-3955
Telecopy:  830-769-2261

Miller Resources, Inc.
P. O. Box 2128
Traverse City, MI 49685-2128
Attn: John Miller
Telephone: 231-941-0073
Telecopy:

Stardust Energy, Inc.
Attention: Don Shepherd
P 0 Box 150909
Austin, Texas 78715
Telephone: 281-685-9917
Telecopy:

Blake Cmajdalka
2415 Hanston Ct.
Pearland Texas, 77584
Telephone: Telecopy:


<PAGE>


Skyline Energy, LLC
2301 Dublin Circle
Pearland, Texas 77581
Attn: Donnie Jones
Telephone:  281-481-0881
Telecopy:  281-481-5645


<PAGE>

<TABLE>
<CAPTION>


                                  EXHIBIT "A-l"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED August 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL


 Party                          Before Prospect Payout       After Prospect Payout              Initial
                                Interest                    Interest                         Consideration
__________________________________________________________________________________________________________
<S>                                    <C>                        <C>                         <C>
 Pin Petroleum                         30.00%                     22.500%                     $51,000.00
 Partners Inc.
__________________________________________________________________________________________________________
 G-White                                5.00%                      3.750%                      $8,500.00
__________________________________________________________________________________________________________
 Oakwood Energy, Inc .                  2.00%                      1.500%                      $3,400.00
__________________________________________________________________________________________________________
 Miller Energy, Inc .                   2.00%                     1.500%                       $3,400.00
__________________________________________________________________________________________________________
 Stardust Energy, Inc .                 1.50%                      1.125%                      $2,550.00
__________________________________________________________________________________________________________
 Blake Cmajakaika                       1.00%                       .750%                      $1,700.00
__________________________________________________________________________________________________________
 Skyline Energy, L.L.C.               58.500%                     66.625%                         NA
 Etal
__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________
 Total                                  100%                        100%
__________________________________________________________________________________________________________

</TABLE>


<PAGE>


                                  EXHIBIT "A-2"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                             DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL



                     AFE TO BE FURNISHED BY MLC OPERATING LP





<PAGE>


                                   EXHIBIT "B"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                  PARTICIPATION AGREEMENT DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL




                                   THE LEASES

1.   Oil, Gas and Mineral Lease dated,  August 10, 2004 by and between,  Wilburn
     Ray Smith, etux, as Lessor, and Skyline Energy, L.L.C., as Lessee, covering
     certain lands in the Jose Pineda Survey, A-40, Cherokee County,  Texas, and
     recorded in Volume _____, Page _____, Deed Records, Cherokee County, Texas.

2.   Oil, Gas and Mineral Lease dated, August 10, 2004 , by and between Lloyd E.
     Elliot Jr.,  etux,  as  Lessors,  and Skyline  Energy,  L.L.C.,  as Lessee,
     covering  certain lands in the Jose Pineda Survey,  A-40,  Cherokee County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

3.   Oil, Gas and Mineral Lease dated,  August 10, 2004, by and between Larry D.
     Campbell,  etux, as Lessor, and Skyline Energy, L.L.C, as Lessee,  covering
     certain lands in the Jose Pineda Survey, A-40, Cherokee County,  Texas, and
     recorded in Volume _____, Page _____, Deed Records, Cherokee County, Texas.

4.   Oil,  Gas and Mineral  Lease  dated,  September  8, 2004,  by and  between,
     Jacksonville  Independent  School District,  as Lessor, and Skyline Energy,
     L.L.C., as Lessee,  covering certain lands in the Jose Pineda Survey, A-40,
     Cherokee  County,  Texas,  and recorded in Volume _____,  Page _____,  Deed
     Records, Cherokee County, Texas.

5.   Oil, Gas and Mineral Lease dated, September 13, 2004, by and between, Patsy
     Jean Scott Boyd, separate property,  as Lessors, and Skyline Energy, L.L.C,
     as Lessee, covering certain lands in the Jose Pineda Survey, A-40, Cherokee
     County,  Texas,  and recorded in Volume  _____,  Page _____,  Deed Records,
     Cherokee County, Texas.

6.   Oil, Gas and Mineral Lease dated,  September 13, 2004, by and between, Bill
     Willis,  etux as Lessor,  and Skyline Energy,  L.L.C,  as Lessee,  covering
     certain lands in the Jose Pineda Survey, A-40, Cherokee County,  Texas, and
     recorded in Volume _____, Page _____, Deed Records, Cherokee County, Texas.

7.   Oil, Gas and Mineral  Lease  dated,  September  29,  2004,  by and between,
     Spence Living Trust, etal, as Lessor, and Skyline Energy, L.L.C, as Lessee,
     covering  certain lands in the Jose Pineda Survey,  A-40,  Cherokee County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

8.   Oil,  Gas and Mineral  Lease  dated,  February  28,  2005,  by and between,
     Ernestine P.  Finley,  as Lessor,  and Skyline  Energy,  L.L.C,  as Lessee,
     covering  certain lands in the Jose Pineda Survey,  A-40,  Cherokee County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

9.   Oil, Gas and Mineral Lease dated, February 28, 2005, by and between,  Rufus
     Eugene Finley as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Jose Pineda Survey, A-40, Cherokee County,  Texas, and
     recorded in Volume _____, Page _____, Deed Records, Cherokee County, Texas.


<PAGE>


10.  Oil, Gas and Mineral  Lease dated,  March 15,  2005,  by and between  Joann
     Moore,  etux, as Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering
     certain lands in the Jose Pineda Survey, A-40, Cherokee County,  Texas, and
     recorded in Volume _____, Page _____, Deed Records, Cherokee County, Texas.


<PAGE>


                                   EXHIBIT "C"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                             DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL



                                  [Attach Plat]


<PAGE>


         [NW Jacksonville Prospect Cherokee Co., Texas Map Appears Here]




<PAGE>


                                   EXHIBIT "D"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL






                     JOA TO BE FURNISHED BY MLC OPERATING LP



<PAGE>






<PAGE>


                                  SCHEDULE "C"
                                  ____________

                              SKYLINE ENERGY, LLC
                               2301 Dublin Circle
                             Pearland, Texas 77581
                      Tele: 281-481-0881 Fax: 281-481-5645

                                August 24, 2005


See Exhibit "A" for Addressees

                              Re: Northwest Jacksonville Prospect
                                  Cherokee County, Texas
                                  (the "Prospect")


     This agreement (hereinafter referred to as "Agreement") is made and entered
into by and between Skyline Energy,  L.L.C.,  who address is 2301 Dublin Circle,
Pearland,  Texas 77581 (hereinafter referred to as "Assignor") and the signatory
parties  identified on Exhibit "A" and "A-l" relative to the leasehold  interest
more fully described in Exhibit "B" attached hereto and incorporated  herein for
all purposes,  (hereinafter singularly referred to as "Assignee" or collectively
as  "Assignees").  Subject to elections made to the contrary,  it is agreed that
all rights and benefits as well as all risks,  costs and expenses granted herein
unto  Assignees  shall be owned and borne by each Assignee in the percentage set
forth next to his name in Exhibit "A-l" hereto.

     Assignor  represents  that it is the present owner of all right,  title and
interest  in and to the oil and gas leases more fully  described  in Exhibit "B"
attached hereto and incorporated herein for all purposes.  Said leases cover 322
+- gross and 315+- net  acres,,  more or less,  out of the Jose Pineda West Four
League Grant Survey,  A-40, Cherokee County,  Texas (hereinafter  referred to as
the  "Leases").  The Leases cover the lands shaded  yellow on the plat  attached
hereto as Exhibit "C" which is incorporated herein for all purposes.

     Assignee is desirous of  acquiring  from  Assignor the  undivided  interest
herein described in the Leases and participating in the drilling of a Test Well,
as defined  below,  for oil and gas  thereon  subject to the terms,  conditions,
reservations  and limitations  herein provided.  The parties  therefore agree as
follows:

With respect to the Leases, Assignor represents and warrants to Assignee that:


<PAGE>


     1.   Assignor owns each of the Leases free and clear of any liens, security
          interests or encumbrances of any kind placed thereon by Assignor.

     2.   To the best of Assignor's knowledge,  the Leases are in full force and
          effect,  are valid and  subsisting  leases,  and all rentals and other
          payments due under the Leases have been properly and timely paid,  and
          all  conditions  necessary to keep the Leases in force have been fully
          performed.

     3.   To the  best  of  Assignor's  knowledge,  no  suit,  action  or  other
          proceeding is pending before any court or  governmental  agency and no
          cause of action exists that relates to the Leases or that might result
          in  impairment  or loss of  Assignee's  title  to any  portion  of the
          Leases.


                                       1.

                                  Consideration
                                  _____________

     For and in consideration of the sums set. forth herein,  Assignor agrees to
assign,  in accordance with Section 9.I. below,  and with warranty of title, by,
through and under Assignor, but not otherwise, and further subject to the terms,
reservations  and conditions of this  Agreement,  the leasehold  interest in the
Leases to each  Assignee in the  proportions  set forth in Exhibit  "A-l" beside
Assignee's name; provided, however, as a condition precedent to such assignment,
Assignee  shall  have  paid  to  Assignor  its pro  rata  share  of the  Initial
Consideration,  defined as eight  eighths  (8/8ths)  of the cost of the  Leases,
legal fees, and geological and administrative costs through the date hereof, and
which is set forth on Exhibit "A-l" hereto,  and its pro rata share of Estimated
Dry Hole Costs, as hereinafter defined.  The Initial  Consideration is comprised
of the following sums:

          Land and Legal Costs
          Geological and Administrative Costs to Date  $185,000.00
                                                       ___________
          Total Initial Consideration                  $185,000.00
                                                       ===========

     It is  further  agreed  that  attached  hereto as  Exhibit  "A-2"  which is
incorporated  herein for all purposes is an Authority  for  Expenditure  ("AFE")
which sets forth the estimated  costs  necessary to drill the Test Well to Total
Depth,  evaluate same with a triple combination log and plug and abandon same if
a dry hole  ("Estimated  Dry  Hole  Costs").  By  execution  of this  Agreement,
Assignor and Assignee do each agree to bear and pay their respective share of


<PAGE>


the Estimated Dry Hole Costs of the Test Well.  Such actual drilling costs which
shall include, without limitation, surface damage and restoration costs.

Assignee  agrees  to bear  and pay for  their  proportionate  share  {Assignee's
"Before Prospect Payout Interest") of the costs associated with the drilling and
development of the prospect before Prospect Payout as hereinafter  defined,  and
their  proportionate  share (Assignee's "After Prospect Payout Interest") of the
costs  associated  with the  prospect  after  Prospect  Payout,  as  hereinafter
defined.

Operator  shall notify each Assignee of the estimated spud date of the Test Well
and request the advance  payment of Assignee's  Estimated  Dry Hole Costs.  Each
Assignee  shall  advance to Operator its share of the  Estimated  Dry Hole Costs
within fifteen (15) days from the date of receipt of said  notification.  Should
any  party  fail or  refuse  to  timely  forward  to  Operator  its share of the
Estimated  Dry Hole Costs  within said fifteen  (15) day period,  then  Operator
shall notify such party by certified  mail that it is  delinquent in making such
payment. It is understood that Operator shall not request the advance payment of
the  Estimated  Dry Hole  Costs  prior to  thirty  (30) days in  advance  of the
estimated spud date of the Test Well.

     Should any Assignee  fail to pay Operator  its share of the  Estimated  Dry
Hole Costs,  such Assignee shall further forfeit its right to participate in the
drilling of the Test Well and this  Agreement  shall be of no further  force and
effect with respect to such  forfeiting  Assignee  whereupon such Assignee shall
forfeit,  as liquidated  damages and not as a penalty,  its share of the Initial
Consideration previously paid to Assignor hereunder.

     Notwithstanding any terms contained in this Agreement to the contrary, upon
payment of the Initial  Consideration  by Assignee to Assignor,  Assignor  shall
have no  liability  to any  Assignee or to  Operator  in the event any  Assignee
subsequently fails to fund its share of the Estimated Dry Hole Costs;  provided,
however,  should another party fail to fund the Initial Consideration  resulting
in the failure of the Test Well to be drilled to total depth, Assignor agrees it
will   promptly   refund   Assignee's   share  of  the  Initial   Consideration.
Additionally,  except as otherwise provided in the Operating Agreement, Assignor
shall have no liability to Assignee for any acts or omissions of Operator in any
way associated with the drilling of the Test Well or any other well which may be
drilled under the terms of this Agreement.

In the event that Operator does not commence actual drilling  operations for the
Test Well on or before  February 28, 2 005, this Agreement  shall  terminate and
Assignor  shall  immediately  refund  the  Initial  Consideration  to  Assignee;
provided, however, the


<PAGE>


commencement date for the Test Well shall be extended in the event the Test Well
is not timely spudded due to delays caused by the drilling contractor. In the
event this Agreement terminates, Assignee shall have no obligation with respect
to any costs or liabilities incurred by Assignor with respect to this Agreement
and Operator agrees to indemnify and hold Assignee harmless against any and all
costs, expenses, claims, demands and causes of action of whatsoever kind or
character, including court costs and attorneys' fees, arising out of any
operations conducted, commitment made or any action taken or omitted with
respect to the Leases in the event the Test Well is not timely spudded by the
Operator as herein provided.
                                       2.

                                    Test Well
                                    _________

     On or before February 28, 2006,  MLC Operating LP, as initial operator
(the  "Operator"),  shall  commence  operations  for the drilling of a test well
(hereinafter  referred  to as the "Test  Well") at a  location  on the Leases as
designated  on the  AFE,  and  shall  thereafter  diligently  and in a good  and
workmanlike  manner  proceed  to cause  the  drilling  of the  Test  Well to the
stratigraphic  equivalent of the lesser of either (i) a true  vertical  depth of
approximately  5,000  feet  beneath  the  surface  of the  earth or (ii) a depth
sufficient  to test the upper  Woodbine  Sands as seen at a depth  sufficient to
test the  upper  Woodbine  Sands as seen at a depth  of  4,790'  to 4912' in the
Feldman Oil & Gas #1  McDonald,  Total Depth 5155'  (hereinafter  referred to as
"Total Depth");  provided,  however,  Assignor may at its sole option extend the
Test Well commencement date subject to rig availability.


                                       3.

                                 Substitute Well
                                 _______________

     In the event the Test Well is lost or junked due to mechanical  difficulty,
or there is encountered in the drilling thereof salt,  domal formation,  cavity,
igneous rock,  heaving  shale,  high pressure gas,  saltwater flow or such other
conditions  which render further  drilling  impracticable,  unduly  difficult or
expensive by ordinary standards of the oil industry, then in lieu of drilling to
Total Depth,  Assignees,  for a period of ninety (90) days after abandoning said
Test  Well,  for any of the  reasons  above  noted,  shall  have the  option  to
commence,  or cause to be commenced,  actual drilling of a substitute well. Such
well shall be drilled at a mutually  acceptable  location,  in a like manner and
under the same terms and  conditions  to the depth  specified for the Test Well,
and the term "Test  Well" as used  herein  shall be  construed  to  include  any
substitute well drilled under the terms of this Agreement; provided, however, in
the event Assignee does not elect to


<PAGE>


participate  in  the  substitute  well,   Assignee  shall  forfeit  the  Initial
Consideration previously paid to Assignor.


                                       4.

                               Operating Agreement
                               ___________________


         Except as otherwise set forth herein, all operations on the lands
covered by the Leases shall be conducted in accordance with the terms of this
Agreement and the Operating Agreement attached as Exhibit "D" which designates
Oakwood Energy, INC. as operator and which is executed contemporaneously
herewith. In the event of a conflict between the terms of this Agreement and the
Operating Agreement, the terms of this Agreement shall prevail and control.


                                       5.

                               Overriding Royalty
                               __________________


     It is agreed and understood that Assignor  hereby reserves unto itself,  or
its designees,  an overriding  royalty burdening the lands covered by the Leases
equal to twenty-five  percent (25%) less presently  existing  leasehold  burdens
thereby  delivering  Assignee  its pro rata share of a  seventy-five  percent of
eight-eights (75% of 8/8ths) net revenue interest.

     In the event any of the  Leases do not cover a full  mineral  interest,  or
Assignor does not own the full leasehold  interest therein,  then the overriding
royalty herein reserved shall be proportionately  reduced.  Furthermore,  should
any of the Leases cover less than all of the lands included within a pooled unit
allocated  to any well drilled  pursuant to the terms  hereof,  such  overriding
royalty  reserved  by  Assignor  herein  shall be  further  reduced  and paid in
proportion to the total number of surface  acres covered by the Leases  included
within the pooled unit bears to the total  number of surface  acres  within said
unit.


                                       6.

                                Well Information
                                ________________

     Assignee  or its  representatives  shall have access at its own risk and at
all times to the  location  and derrick  floor  during the  drilling of any well
hereunder. Each Assignee shall further be entitled to all information concerning
any well drilled hereunder and the Leases unless any such party is delinquent in
the payment of its joint interest billings to Operator for a period greater


<PAGE>


than thirty (30) days in which  event  Operator at its sole option may  withhold
any information to such delinquent party.

                                       7.

                            Area of Mutual Interest
                            _______________________

     The parties  hereto  hereby  establish an Area of Mutual  Interest  ("AMI")
which  covers  and  includes  all lands  depicted  within  the area one (1) mile
outside the  perimeter of the lands  covered by the Leases which are depicted on
the plat  attached  hereto as Exhibit  "C".  In the event that any party  hereto
hereafter  acquires an oil and gas leasehold  interest,  or contractual right to
earn an oil and gas leasehold interest, covering lands lying in whole or in part
within the AMI, the acquiring party shall, in writing,  offer to assign, without
warranty of title, to the nonacquiring parties, within ten (10) days of purchase
or acquisition, the entire proportionate interest which the nonacquiring parties
are ratably entitled to acquire within the AMI under this Agreement. Such notice
shall  include a copy of the lease or contract,  paid draft and other  pertinent
and available data. Each nonacquiring  party shall,  within ten (l0) days after
receipt of such offer,  elect  whether to purchase  such  interest by paying the
acquiring parties such  nonacquiring  party's  proportionate  part of the actual
cost and expenses,  if any,  incurred by the acquiring  party in acquiring  such
lease or  contract.  Failure  by any  nonacquiring  party to timely  notify  the
acquiring  party shall be deemed an election by such  nonacquiring  party not to
acquire  its  ratable  interest  in the  leasehold  interest  offered.  When any
nonacquiring  party  elects  not to  acquire  its  ratable  interest  from  the
acquiring party,  such  nonacquiring  party's interest in such lease or contract
which is the subject of such offer  shall be offered to the parties  electing to
acquire its proportionate share of such non-acquiring party's interest and shall
not be subject to this Agreement but an operating agreement identical to Exhibit
D, after allowing for nonjoinder by the  non-acquiring  party.  Unless otherwise
mutually agreed, this AMI shall terminate six (6) months after the expiration of
the last lease  within the AMI.  All  interests  under this  paragraph  shall be
offered on either a Before  Prospect Payout Basis or After Prospect Payout Basis
based on the occurrence of Prospect Payout.

                                       8.
                                 Prospect Payout
                                 _______________


     Upon the occurrence of "Prospect  Payout" as defined below,  Assignor shall
back-in against the interest of Assignee in the Leases for a twenty-five percent
of eight-eighths (25% of 8/8ths)


<PAGE>


working  interest  whereupon  the parties  shall own the After  Prospect  Payout
interests  set forth in Exhibit "A-l"  hereto.  All costs and expenses  incurred
prior to the  occurrence  of  Prospect  Payout  shall be borne by the parties in
accordance with their  respective  Before Prospect Payout interests set forth in
Exhibit "A-l" hereto.

"Prospect  Payout" is defined as and shall  occur at 12:01 a.m. on the first day
of the month following the day when the net proceeds received by Assignee out of
production from the Test Well and all subsequent  wells drilled on. the prospect
(after first  deducting  the  production  and severance  taxes,  and all royalty
payments effective as of the effective date of this Agreement, lessor's royalty,
overriding  royalties including,  without limitations,  the overriding royalties
reserved  by  Assignor  herein,   non-participating  royalties,  and  production
payments) shall equal the sum of Assignee's share of the:

     (a)  Initial Consideration;

     (b)  cost of land and legal  costs and all costs for  leases;  acquired  by
          Assignee  within the AMI prior to the occurrence of Prospect Payout or
          other land related costs and land maintenance costs,  geological cost,
          seismic  costs,  or  other  non-drilling  related  costs  incurred  by
          Assignee prior to Prospect Payout;

     (c)  the costs of drilling, testing,  evaluating,  completing and equipping
          the Test Well and all subsequent wells drilled on the prospect,  prior
          to Prospect  Payout into the point of sale which  includes  but is not
          limited to the wellhead, tank batteries, gathering lines and all other
          related surface equipment and facilities; and

     (d)  the operating costs, and reworking or re-completing  costs incurred on
          such wells during the payout period.

     The Operator agrees to provide all parties to this Agreement with quarterly
payout statements.


                                       9.

                                  Miscellaneous
                                  _____________

A.   Paragraph Headings

     The paragraph  headings  inserted in this Agreement are utilized solely for
reference purposes and do not constitute  substantive matter to be considered in
construing the terms of this Agreement.

B.   Time is of the Essence


<PAGE>


     It is  specifically  understood  and  agreed  that  time is of the  essence
hereunder.

C.   Liability

     It is not the purpose of this  Agreement  to create a  partnership,  mining
partnership,  partnership for a specific  purpose,  joint venture,  or any other
relationship which would render the parties liable as partners,  associates,  or
joint venturers.

D.   Entire Agreement

     This Agreement shall  constitute the entire  Agreement  between the parties
hereto  and  supersedes  any  prior   agreements,   promises,   negotiations  or
representations,  whether  written  or oral,  not  expressly  set  forth in this
Agreement.  No variations,  modifications,  or changes herein or hereof shall be
effective unless evidenced by written document executed by the parties hereto.

E.   Counterparts

     This  Agreement  may be  executed  in any number of  counterparts  and each
counterpart  so executed  shall be deemed an original for all purposes and shall
be binding  upon each  party  executing  same  whether  or not  executed  by all
parties.

F.   Governing Law

     This Agreement shall be governed by the laws of the State of Texas.


G.   Binding Agreement

     The terms,  covenants  and  conditions of this  Agreement  shall be binding
upon,  and shall  inure to the  benefit  of,  the  parties  hereto  and to their
respective heirs,  executors,  administrators,  successors and assigns, and such
terms,  covenants and conditions  shall be deemed as covenants  running with the
lands and leases covered hereby. It is stipulated,  however,  that no assignment
or  transfer  by or,  however  accomplished,  of any  right,  title or  interest
acquired  hereunder  shall  relieve such party of any  liability  or  obligation
herein assumed, except with written consent of the other party.

H.   Acceptance

     If the  foregoing  fully sets forth your  understanding  of our  agreement,
please so indicate by execution in the space provided


<PAGE>


below and return one (1) fully executed original hereof together with your share
of the Initial  Consideration  described in Section 1. hereof. If this Agreement
is not accepted and returned  within fifteen (15) days from the date hereof with
your share of the Initial Consideration, this Agreement shall be voidable by any
party and such shares of Initial Consideration shall be returned promptly to the
Assignee.

I.   Delivery of Assignment

     With   Assignee's   tendering  of  its   pro-rata   share  of  the  Initial
Consideration and its pro-rata share of the Estimated Dry Hole Costs as provided
herein,  Assignor  shall upon  request  provide  Assignee  with  complete  lease
purchase  packages for the Leases.  Assignor  shall record an  assignment of the
Leases to the  Assignee and upon receipt  provide  Assignee with a copy of such
recorded assignment.

J.   Notices

     All notices  required under this agreement  shall be made to the parties at
the addresses and fax numbers identified in Exhibit "A".

K.   Well Data Requirements

     Assignor  shall provide or cause to be provided  certain well data required
by Assignee in all wells in which Assignee is a participant.  Such  requirements
will be fully identified under separate cover.

L.   Delay Rental Payments

     Any and all delay rental payments shall be paid by Assignor and invoiced to
Assignee based on it current working  interest.  Delay rentals accruing (if any)
prior  to  reaching  casing  point  in the Test  Well  shall be a  proportionate
obligation  on the part of all parties;  however after such a time same shall be
the subject of future recommendations and elections.

                                            Very truly yours,

                                            SKYLINE ENERGY, L.L.C.


                                            By: /s/ DONNIE JONES
                                                ___________________________
                                                    Donnie Jones, President


<PAGE>


AGREED TO AND ACCEPTED THIS

8th DAY OF September  2005

Pin Petroleum Partners Inc.

By:  /s/ WILLIAM FRIESEN
_______________________________
Name: _________________________
Title: ________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

G-White

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

Oakwood Energy, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________DAY OF_________, 2005

Stardust Energy, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________ DAY OF_________, 2005

Blake Cmajadalka

By:____________________________
Name:__________________________
Title:_________________________


<PAGE>


AGREED TO AND ACCEPTED THIS
________DAY OF _________, 2005

Miller Resources, Inc.

By:____________________________
Name:__________________________
Title:_________________________

AGREED TO AND ACCEPTED THIS
________DAY OF_________, 2005

By:____________________________
Name:__________________________
Title:_________________________


<PAGE>


                                   EXHIBIT "A"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED MAY 23, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL

                                   ADDRESSEES


Pin Petroleum Partners Inc.
Suite 2410, 650 West Georgia Street
P. O. Box 11524
Vancouver, British Columbia, Canada, V6B 4N7
Telephone: 604-689-8336
Telecopy: 604-682-5564

Oakwood Energy, INC.
P. O. Box 297
Jourdanton, Texas 78026
Attention: Barry Laidlaw
Telephone: 830-769-3955
Telecopy:  830-769-2261

Miller Resources, Inc.
P. O. Box 2128
Traverse City, MI 49685-2128
Attn: John Miller
Telephone: 231-941-0073
Telecopy:

Stardust Energy, Inc.
Attention: Don Shepherd
P 0 Box 150909
Austin, Texas 78715
Telephone: 281-685-9917
Telecopy:

Blake Cmajdalka
2415 Hanston Ct.
Pearland Texas, 77584
Telephone: Telecopy:

Skyline Energy, LLC
2301 Dublin Circle
Pearland, Texas 77581
Attn: Donnie Jones
Telephone:  281-481-0881
Telecopy:  281-481-5645


<PAGE>

<TABLE>
<CAPTION>


                                  EXHIBIT "A-l"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED August 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL


 Party                          Before Prospect Payout       After Prospect Payout              Initial
                                Interest                    Interest                         Consideration
__________________________________________________________________________________________________________
<S>                                    <C>                        <C>                         <C>
 Pin Petroleum                         30.00%                     22.500%                     $55,500.00
 Partners Inc.
__________________________________________________________________________________________________________
 G-White                                5.00%                      3.750%                      $9,250.00
__________________________________________________________________________________________________________
 Oakwood Energy, Inc .                  2.00%                      1.500%                      $3,700.00
__________________________________________________________________________________________________________
 Miller Energy, Inc .                   2.00%                     1.500%                       $3,700.00
__________________________________________________________________________________________________________
 Stardust Energy, Inc .                 1.50%                      1.125%                      $2,775.00
__________________________________________________________________________________________________________
 Blake Cmajakaika                       1.00%                       .750%                      $1,850.00
__________________________________________________________________________________________________________
 Skyline Energy, L.L.C.               58.500%                     66.625%                         NA
 Etal
__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________

__________________________________________________________________________________________________________
 Total                                  100%                        100%
__________________________________________________________________________________________________________

</TABLE>


<PAGE>


                                  EXHIBIT "A-2"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                             DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL



                     AFE TO BE FURNISHED BY MLC OPERATING LP





<PAGE>


                                   EXHIBIT "B"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                  PARTICIPATION AGREEMENT DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL




                                   THE LEASES

1.   Oil, Gas and Mineral Lease dated,  January 12, 2005 by and between,  George
     Station,  Individually and as Trustee,  Lessor, and Skyline Energy, L.L.C.,
     as Lessee,  covering  certain  lands in the Jose  Pineda  West Four  League
     Grant,  A-40,  Cherokee County,  Texas, and recorded in Volume _____,  Page
     _____, Deed Records, Cherokee County, Texas.

2.   Oil,  Gas and Mineral  Lease  dated,  March 4, 2005 by and between  Regions
     Bank,  Trustee for Lisa Barber Helton,  et al, Lessor,  and Skyline Energy,
     L.L.C.,  as Lessee,  covering  certain  lands in the Jose  Pineda West Four
     League Grant, A-40,  Cherokee County,  Texas, and recorded in Volume _____,
     Page _____, Deed Records, Cherokee County, Texas.

3.   Oil, Gas and Mineral Lease dated,  March 28, 2005 by and between  Marvin J.
     Angle,  et ux,  Lessor,  and Skyline  Energy,  L.L.C,  as Lessee,  covering
     certain  lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee
     County,  Texas,  and recorded in Volume  _____,  Page _____,  Deed Records,
     Cherokee County, Texas.

4.   Oil, Gas and Mineral Lease dated, March 28, 2005, by and between, Gordon F.
     Thrall,  Lessor,  and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

5.   Oil, Gas and Mineral  Lease dated,  March 28, 2005,  by and between,  Sybil
     Lucas  Spiers,  Lessor,  and Skyline  Energy,  L.L.C,  as Lessee,  covering
     certain  lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee
     County,  Texas,  and recorded in Volume  _____,  Page _____,  Deed Records,
     Cherokee County, Texas.

6.   Oil, Gas and Mineral Lease dated,  March 28, 2005,  by and between,  Martha
     Ann Wheeler, Lessor, and Skyline Energy, L.L.C, as Lessee, covering certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

7.   Oil, Gas and Mineral Lease dated, March 28, 2005, by and between,  Marijane
     Wernsman,  Lessor, and Skyline Energy,  L.L.C, as Lessee,  covering certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

8.   Oil,  Gas and Mineral  Lease dated,  May 27, 2005 by and  between,  Hawkins
     Revocable Trust,  Lessor,  and Skyline Energy,  L.L.C, as Lessee,  covering
     certain  lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee
     County,  Texas,  and recorded in Volume  _____,  Page _____,  Deed Records,
     Cherokee County, Texas.

9.   Oil, Gas and Mineral Lease dated,  May 27, 2005, by and between,  Donald W.
     Hawkins,  Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.


<PAGE>


10.  Oil, Gas and Mineral Lease dated,  April 4, 2005, by and between Chardonnay
     1, Ltd.,  Lessor, and Skyline Energy,  L.L.C., as Lessee,  covering certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

11.  Oil, Gas and Mineral Lease dated, April 5, 2005, by and between,  Thomas A.
     Woyt,  et ux,  Lessor,  and Skyline  Energy,  L.L.C.,  as Lessee,  covering
     certain  lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee
     County,  Texas,  and recorded in Volume  _____,  Page _____,  Deed Records,
     Cherokee County, Texas.

12.  Oil, Gas and Mineral Lease dated, April 4, 2005, by and between,  F. B. and
     M. L. Elliott Living Trust, Lessor, and Skyline Energy,  L.L.C., as Lessee,
     covering  certain  lands in the Jose Pineda West Four League  Grant,  A-40,
     Cherokee  County,  Texas,  and recorded in Volume _____,  Page _____,  Deed
     Records, Cherokee County, Texas.

13.  Oil, Gas and Mineral  Lease dated,  April 4, 2005,  by and between,  Maxine
     Thompson,  Lessor, and Skyline Energy, L.L.C., as Lessee,  covering certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.

14.  Oil, Gas and Mineral  Lease dated,  April 5, 2005by and between,  Steven J.
     Berry,  et ux, Lessor,  and Skyline  Energy,  L.L.C.,  as Lessee,  covering
     certain  lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee
     County,  Texas,  and recorded in Volume  _____,  Page _____,  Deed Records,
     Cherokee County, Texas.

15.  011, Gas and Mineral Lease dated, May 11, 2005, by and between, Frank Saye,
     et ux, Lessor,  and Skyline Energy,  L.L.C.,  as Lessee,  covering  certain
     lands in the Jose Pineda West Four League  Grant,  A-40,  Cherokee  County,
     Texas,  and recorded in Volume _____,  Page _____,  Deed Records,  Cherokee
     County, Texas.


<PAGE>


                                   EXHIBIT "C"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                             DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL



                                  [Attach Plat]


<PAGE>


         [Hwy 79 Prospect Cherokee Co., Texas Map Appears Here]




<PAGE>


                                   EXHIBIT "D"
                   ATTACHED TO AND MADE A PART OF THAT CERTAIN
                             PARTICIPATION AGREEMENT
                              DATED AUGUST 24, 2005
                    BY AND BETWEEN SKYLINE ENERGY, L.L.C. AND
                        PIN PETROLEUM PARTNERS INC., ETAL






                     JOA TO BE FURNISHED BY MLC OPERATING LP