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                                                                     EXHIBIT 8.1


                        [LETTERHEAD OF CROWE & DUNLEVY]



                               February 14, 2000



Canaan Energy Corporation
119 N. Robinson, Suite 600
Oklahoma City, Oklahoma 73102

Gentlemen:

          We have acted as counsel to Canaan Energy Corporation, an Oklahoma
corporation ("Canaan"), in connection with that certain Registration Statement
with respect to 5,000,000 shares of common stock of Canaan, filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
on or about February 14, 2000 (the "Registration Statement"). Except as
otherwise indicated, all terms used herein shall have the respective meanings
assigned to them in the Registration Statement.  Canaan filed the Registration
Statement in connection with the proposed Plan of Combination.

          You have requested our opinion regarding the material Federal income
tax consequences of certain aspects of the proposed Plan of Combination.  Our
opinion assumes the accuracy and completeness of the facts set forth in the
Registration Statement and certain additional facts and assumptions set forth in
the certificates, attached hereto collectively as Exhibit A (the "Certificate").

          Based upon the foregoing, in reliance thereon and subject thereto, and
subject to the other limitations set forth below, the statements made in the
preliminary Prospectus/Proxy Statement being filed with the Registration
Statement under the captions "Summary-Summary of Certain Federal Income Tax
Consequences" and "Certain Federal Income Tax Consequences" with respect to our
tax opinions represent our opinions of the tax consequences described therein.

          (A) No opinion is expressed as to any matter not specifically
     addressed above, including the reasonableness of the above-referenced
     assumptions relied upon by us in rendering the opinion set forth above.

          (B) Our opinions are based upon the Internal Revenue Code of 1986, as
     amended ("Code"), the Treasury Regulations promulgated thereunder, judicial
     decisions, published rulings of the Internal Revenue Service ("IRS"), and
     other administrative pronouncements, all as in effect on the date hereof.
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Canaan Energy Corporation
February 14, 2000
Page 2




          (C) The statutory, judicial, regulatory and administrative authorities
     relied upon by us in rendering the above-referenced opinions may be amended
     or revoked at any time. Any such changes may or may not be retroactive with
     respect to transactions entered into or contemplated prior to the effective
     date thereof and could significantly alter this opinion. There can be no
     assurance that legislative, judicial or administrative changes affecting
     the tax consequences described in the Prospectus/Proxy Statement will not
     occur in the future. We assume no obligation to update or modify this
     opinion to reflect any developments that occur after the date hereof.

          (D) This opinion is being furnished to you solely for your exclusive
     use and may not be relied upon by any person without our prior written
     consent.  We hereby consent to the use of this opinion as an exhibit to the
     Registration Statement and to the use of our name in the Registration
     Statement and Prospectus/Proxy Statement under the heading "Legal Matters".

          (E) This opinion is not binding on the IRS or the courts and is
     dependant upon the accuracy and completeness of the facts set forth in the
     Registration Statement and the facts and assumptions set forth in the
     Certificates.  We have relied upon these facts and assumptions, and any
     inaccuracy or incompleteness in our understanding of those facts or
     assumptions could adversely affect the Federal income tax consequences of
     the Plan of Combination transactions and, accordingly, could alter our
     opinion.

                              Respectfully submitted,

                              CROWE & DUNLEVY
                              A Professional Corporation


                              By: /s/ Reeder E. Ratliff
                                  -------------------------------------
                                  Reeder E. Ratliff

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