EXHIBIT 4.12
                              CONSULTING AGREEMENT

This Consulting Agreement ("Agreement") is entered into effective as of January
1, 2000 (the "Effective Date"), by and between SGI International, a Utah
corporation ("SGI") and Thomas Hoover, ("Consultant").

1. Performance by Consultant. Consultant agrees to provide consulting services
(the "Services") relative to investor and public relations. Consultant will
provide communication services relative to SGI shareholders and debt holders.
The Services shall also include, but not be limited to, advice, assistance, and
information supplied by Consultant, or developed with the use of any of
Consultant's information, equipment, personnel, goods or facilities.

2. Payment for Services.

a. Consulting Fee. SGI agrees to pay Consultant for the Services at a rate of
$1,600.00 per month. Consultant shall also be issued 67,500 shares of
restricted stock valued by the parties at $6,750.00 after execution of this
agreement.

b. Payments. SGI shall pay Consultant within 15 days of the end of each month
for all work performed during the prior month.

3. Personal Service Contract. SGI and Consultant agree that the Services will
be performed personally by Consultant. If the Services are not performed by
Consultant, then SGI has the right to terminate this Agreement immediately.

4. Obligations of SGI. SGI agrees to make available to Consultant, upon
reasonable notice, computer programs, data, and any documentation required by
Consultant to complete the Services.

5. Term. This Agreement shall be effective on the Effective Date and shall
continue for a period for one year.

6. Confidentially and Disclosure.

a. Disclosure. Consultant desires to have Confidential Information disclosed to
him to enable him to render the Services to SGI, including but not limited to,
the following: information related to SGI's business and technologies. SGI is
prepared to make available such Confidential Information as it deems necessary
to Consultant for the aforesaid purpose on the following understanding:

For the purpose of the Agreement:

The term "Confidential Information" shall not include any information which:

(i) is "publicly available" information. The phrase "publicly available"
information shall mean readily accessible to the public in written publication,
and shall not include information which is only available by a substantial
searching of the published literature and information the substance of which
must be pieced together from a number of different publications and sources;

(ii) is known to Consultant from sources other than SGI or its Affiliates prior
to the receipt of the same hereunder from SGI or its Affiliates;

(iii) is received by Consultant without restriction on disclosure from a third
party who is legally in possession of such information and has a right to
reveal the same to Consultant.

(iv) "Affiliate(s)" of SGI shall mean any person or entity directly or
indirectly controlling, controlled by or under common control with SGI.
<PAGE>
Notwithstanding anything herein to the contrary in this Agreement, Consultant
shall have the right to use general skills and capabilities developed as a
result of his performance of Services for his own benefit or the benefit of
others subject to the obligations of Consultant set forth hereinafter.

b. Confidentiality. Consultant agrees to hold the Confidential Information in
confidence and not to reproduce or disclose it to others nor to use it except
as herein authorized in writing or as may later be authorized in writing by SGI.

c. Usage. Both parties agree that the Consultant may use such Confidential
Information in connection with, but only in connection with, providing Services
to SGI.

7. Warranties. Consultant hereby warrants that he will carry out his work in
accord with generally accepted practices.

8. Termination. This Agreement shall be effective on the Effective Date and
continue in full force and effect for one year. The Agreement may be extended
by the parties upon mutual written consent.

9. Independent Contractor. Consultant is and at all times during the term of
this Agreement shall be an independent contractor providing professional
consulting services to SGI. Nothing contained in this Agreement shall be
construed to create a relationship of principal and agent, employer and
employee, servant and master, partnership or joint venture between the parties.
Consultant shall have no power to commit or bind SGI in any manner whatsoever.

10. Limitation of Liability. In no event shall either of the parties hereto be
liable to the other for the payment of any consequential, indirect, or special
damages, including lost profits.

11. Injunctive Relief. It is hereby understood and agreed that damages are an
inadequate remedy in the event of a breach by Consultant of this Agreement and
that any such breach by Consultant will cause SGI great and irreparable injury
and damage. Accordingly, Consultant agrees that SGI shall be entitled, without
waiving any additional rights or remedies otherwise available to SGI at law or
in equity or by statute, and without posting any bond, to obtain injunctive or
other equitable relief in the event of a breach or intended or threatened breach
by Consultant of this Agreement.

12. Assignment.

a. Consent Required. Consultant shall not assign or subcontract the whole or
any part of this Agreement without SGI's written consent, which can be withheld
for any reason.

b. Subcontracting. Any subcontract made by Consultant with the consent of SGI,
which must be obtained before Consultant enters into any subcontract, shall
incorporate by reference all of the terms of this Agreement. Consultant agrees
to guarantee the performance of any subcontractor used in the performance of
the Services.

13. Conflicting Assignments. During the term of this Agreement, Consultant shall
not accept conflicting assignments, which would put Consultant in a position
where he would be rendering advice or providing information to any party who
might be a potential competitor of SGI presently or in the future, nor shall
Consultant provide any advice, which might disclose any confidential
Information.

14. Disputes. If any dispute of any kind arises between the parties with respect
to the Consultant's performance under this Agreement, then the dispute shall be
submitted to arbitration in San Diego, California to the American Arbitration
Association ("AAA"). The dispute shall be submitted to an arbitrator selected
from a panel of arbitrators submitted to the parties by the AAA. If the parties
fail to agree on an arbitrator, the AAA shall appoint an arbitrator and in the
absence of such appointment, the parties may request an appointment by making an
application to the San Diego Superior Court to order an appointment. Reasonable
discovery, including but not limited to depositions and interrogatories, shall
be allowed in any such arbitration. The decision of the arbitrator shall be
binding to the same extent as if the award were made by a court of competent
jurisdiction.

15. Notices. Any and all notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given or received when delivered
personally or forty-eight (48) hours after being mailed, via first-class U. S.
Mail, postage prepaid, to the addresses set forth immediately below of the
parties hereto or to such other addresses as either of the parties hereto from
time to time designate in writing to the other party.
<PAGE>
SGI: SGI International
1200 Prospect, Suite 325
La Jolla, California 90037
Attn: Michael L. Rose

Consultant: Thomas Hoover
400 Woodlawn, #101
Wichita, KS 67208

16. Applicable Law. The provisions of this Agreement shall be construed and
enforced in accordance with the laws of the State of California.

17. Entire Agreement and Amendments. This Agreement constitutes the entire
understanding and agreement between the parties relating to the subject matter
hereof and supersedes any prior written or oral understanding or agreement
between the parties relating to the subject matter hereof. This Agreement shall
not be amended, altered, or supplemented in any way except by an instrument in
writing, signed by the duly authorized representative of the parties, that
expressly references this Agreement.

18. Waivers. The failure or delay of either party to exercise or enforce at any
time any of the provisions of this Agreement shall not constitute or be deemed a
waiver of that party's right thereafter to enforce each and every provision of
the Agreement and shall not otherwise affect the validity of this Agreement.

19. Severability. If any provision of this Agreement is finally determined to be
contrary to, prohibited by, or invalid under applicable laws or regulations,
such provision shall become inapplicable and shall be deemed omitted from this
Agreement. Such determination shall not, however, in any way invalidate the
remaining provisions of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and in
the year first above written.

                                        SGI Consultant

SGI International
A Utah Corporation

By: /S/ MICHAEL L. ROSE                 By: THOMAS HOOVER
------------------------------------    -----------------
Michael L. Rose                         Thomas Hoover