FORELAND CORPORATION

                           NON-QUALIFIED STOCK OPTION
                                   (EMPLOYEE)


              IT IS IMPORTANT THAT YOU RETAIN THIS DOCUMENT.  THIS
          ORIGINAL NON-QUALIFIED STOCK OPTION MUST BE DELIVERED TO THE
                 COMPANY ON EXERCISE OR TRANSFER OF THE OPTION.


     THIS NONQUALIFIED STOCK OPTION (this "Option") is granted this       day of
               , 1996, by FORELAND CORPORATION, a Nevada corporation (the
"Company"), to                      ("Optionee"), pursuant to a resolution of
the board of directors of the Company.

     1.   Grant of Option.  The Company hereby irrevocably grants to Optionee
the right and option to purchase all or any part of an aggregate of 8,000 shares
of common stock, par value $0.001 per share, of the Company (the "Common Stock")
on the terms and conditions hereinafter set forth.

     2.   Exercise Price.  The exercise price of this Option shall be $4.00 per
share (the "Exercise Price").

     3.   Vesting of Option.  The rights of the Optionee under the terms of this

Option shall vest and only be exercisable in installments as follows:

          (a)  on the date of this Option, the Optionee shall have the vested
     right to acquire 2,000 shares of Common Stock on the terms and conditions
     of this Option;

          (b)  commencing one year after the date of this Option, the Optionee
     shall have the vested right to acquire 2,000 shares of Common Stock on the
     terms and conditions of this Option;

          (c)  commencing two years after the date of this Option, the Optionee
     shall have the vested right to acquire 2,000 shares of Common Stock on the
     terms and conditions of this Option; and

          (d)  commencing three years after the date of this Option, the
     Optionee shall have the vested right to acquire 2,000 shares of Common
     Stock on the terms and conditions of this Option.

All rights to acquire shares of Common Stock hereunder shall expire seven years
after the date of vesting of each such right as provided above. No rights under
this Option, whether vested or unvested, may be exercised unless the holder was,
within 30 days of such exercise, and had been since the date of this Option, an
eligible employee of the Company as specified in the provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), which would be applicable if this
Option were issued pursuant to an incentive plan, unless the employment was
terminated as a result of the death or disability  (as defined in the Code and
the regulations promulgated thereunder as they may be amended from time to time)
of the employee or the employee dies within 30 days after the termination.  In
the event of termination as a result of disability, the holder shall have a one
year period following termination in which to exercise the Option.  In the event
of death of the holder, the Option must be exercised within six months of the
issuance of letters testamentary or administration or the appointment of an
administrator, executor, or personal representative, but not later than one year
after the date of termination of employment.  An authorized absence or leave
approved by the Board or a duly authorized committee for a period of 90 days or
less shall not be considered an interruption of employment for any purpose under
this Option.

     4.   Shareholder's Rights.  The Optionee shall have the rights of a
shareholder only with respect to Common Stock fully paid for by Optionee under
this Option.

     5.   Adjustment to Number of Shares of Common Stock.

          (a)  In the event that a share dividend shall be declared upon the
     common stock of the Company, the number of shares of Common Stock then
     subject to this Option shall be adjusted by adding to each such share the
     number of shares which would be distributable in respect thereof if such
     Common Stock had been outstanding on the date fixed for determining the
     shareholders of the Company entitled to receive such share dividend.

          (b)  In the event that the outstanding shares of the Company shall be
     changed into or exchanged for a different number or kind of shares or other
     securities of the Company or of another corporation, whether through
     reorganization, recapitalization, split-up, combination of shares, merger,
     consolidation, or otherwise, then there shall be substituted for each share
     of Common Stock subject to this Option the number and kind of shares or
     other securities into which each outstanding share of the Company shall
     have been so changed or for which each such share shall have been
     exchanged.  Under no circumstances shall any such reorganization,
     recapitalization, split-up, combination of shares, merger, consolidation,
     or other exchange be accomplished without a comparable share option being
     substituted pursuant to the foregoing.

          (c)  In the event there shall be any change, other than as specified
     elsewhere in this paragraph, in the number or kind of outstanding shares or
     of any shares or other securities into which such shares shall have been
     changed or for which they shall have been exchanged, then the board shall,
     in its sole discretion, determine whether such change equitably requires an
     adjustment in the number or kind of Common Stock to be issued on the
     exercise of this Option.  Such adjustment shall be made by the board and
     shall be effective and binding for all purposes of this Option.

          (d)  In the case of any such substitution or adjustment as provided
     for in this paragraph, the option price set forth in this Option for each
     share of Common Stock covered hereby prior to such substitution or
     adjustment shall be the option price for all shares or other securities
     which shall have been substituted for such Common Stock or to which such
     Common Stock shall have been adjusted pursuant to this paragraph.  No
     adjustment or substitution provided for in this paragraph shall require the
     Company to sell a fractional share of Common Stock, and the substitution or
     adjustment with respect to this Option shall be limited accordingly;
     provided, however, that the aggregate option price paid shall be
     appropriate reduced on account of any fractional share of Common Stock not
     issued.  Upon any adjustment made pursuant to this paragraph, the Company
     shall, upon request, deliver to the Optionee a certificate of the Company's
     treasurer setting forth the option price thereafter in effect and the
     number and kind of shares or other securities thereafter purchasable on the
     exercise of this Option.

          (e)  If at any time:

               (i)  The Company proposes to pay any dividend or make any
          distribution, including a cash or property dividend payable out of
          earnings, earned surplus, or the assets of the Company; or

               (ii) The Company proposes to effectuate any plan of
          reorganization or reclassification of the Common Stock; or
               (iii)     The Company proposes to merge, consolidate, or encumber
          or sell all or substantially all of its assets other than in the
          ordinary course of business;

     then, and in any one or more of such events, the Company shall cause a
     notice to be mailed to the registered holder(s) of this Option at the
     address of such holder(s) set forth in the registration records of the
     Company.  Such notice shall be solely for the convenience of such
     registered holders and shall not be a condition precedent to, nor shall any
     defect therein or failure in connection therewith affect the validity of,
     the action proposed to be taken by the Company.  Such notice shall be
     mailed at least twenty (20) days prior to the date on which the books of
     the Company shall close or a record date shall be taken for such dividend,
     share split, or reclassification, consolidation, merger, or sale of
     properties and assets, as the case may be.  Such notice shall specify the
     record date for the closing of the Company's shareholder records.

     6.   Record Owner.  The Company may deem and treat the registered owner of
this Option as the absolute owner hereof for all purposes and shall not be
affected by any notice to the contrary.

     7.   Method of Exercise.  This Option may be exercised, in accordance with
all of the terms and conditions set forth in this Option, by delivery of this
Option together with a notice of exercise, a form of which is attached hereto as
Exhibit "A" and incorporated herein by this reference, indicating the number of
Shares which the Optionee then elects to purchase and with payment made in
accordance with the following:

          (a)  If Optionee elects to exercise the Option and make payment, in
     whole or in part,  for the shares of Common Stock in cash, Optionee shall
     include with the notice of exercise a certified check or official bank
     check payable to the order of the Company in the amount of the full option
     price of the Common Stock being purchased for cash.

          (b)  If Optionee elects to exercise the Option and make payment, in
     whole or in part, for the shares of Common Stock in installments, Optionee
     shall include with the notice of exercise a certified check or official
     bank check payable to the order of the Company in the amount of any cash to
     be paid on exercise, and a promissory note, in form satisfactory to the
     Company, executed by the Optionee and evidencing the obligation of the
     Optionee to pay the balance of the exercise price on terms and conditions
     acceptable to the board of directors of the Company at the time of exercise
     of the Option.

          (c)  If Optionee elects to exercise the Option and make payment, in
     whole or in part, for the shares of Common Stock by delivery of shares of
     Common Stock of the Company that have been owned by Optionee for over six
     months, Optionee shall surrender or transfer to the Company, in a form
     satisfactory to it, such shares of Common Stock valued at their fair market
     value.  Fair market value shall mean the closing price for such stock as
     quoted on a registered national securities exchange or, if not listed on a
     national exchange, the Nasdaq Stock Market ("Nasdaq"), over the five-day
     trading period immediately preceding the date of exercise of such Option,
     or, if not listed on such  an exchange or included on Nasdaq, shall mean
     the closing price (or, if no closing price is available from sources deemed
     reliable by the Company, the closing bid quotation) for such stock as
     determined by the Company through any other reliable means of determination
     available on the close of business on the trading day last preceding the
     date of exercise of such Option.

          (d)  If the Optionee decides to exercise the Option in whole or in
     part, and make payment, in whole or in part, for the Common Stock by the
     delivery of options or other rights to purchase shares of Common Stock,
     whether such options consist of the Options represented hereby or other
     options or rights to purchase Common Stock, Optionee shall surrender or
     transfer to the Company, in form satisfactory to it, such options or rights
     to purchase Common Stock, valued at the amount by which the market value of
     the Common Stock subject to such options or other rights, as determined in
     accordance with the provisions of subparagraph (c) above, exceeds the
     exercise or purchase price provided in such options or rights.

     As soon as practicable after receipt by the Company of such notice and of
payment in full of the option price of all the shares of Common Stock with
respect to which the Option has been exercised (including interest if payment is
made in installments), a certificate or certificates representing such shares of
Common Stock shall be issued in the name of the Optionee, or, if the Optionee
shall so request in the notice exercising the Option, in the name of the
Optionee and another person jointly, with right of survivorship, and shall be
delivered to the Optionee.  To the extent required by the terms of this Option,
all Common Stock shall be issued only upon receipt by the Company of the
Optionee's representation that the shares are purchased for investment and not
with a view to distribution thereof.  If this Option is not exercised with
respect to all Common Stock subject hereto, Optionee shall be entitled to
receive a similar Option of like tenor covering the number of shares of Common
Stock with respect to which this Option shall not have been exercised.

     8.   Availability of Shares.  During the term of this Option, the Company
shall at all times keep available for issuance the number of shares of Common
Stock Option subject to this Option.

     9.   No Right of Employment.  Nothing contained in this Option shall be
construed as conferring any right to continue or remain as an officer, director,
or employee of the Company or any subsidiary.

     10.  Restrictions on Transfer.  The Option and the Common Stock subject to
the Option (collectively referred to as the "Securities") are subject to
registration under the Securities Act of 1933, as amended (the "Securities
Act"), and any  applicable state securities statutes.  Optionee acknowledges
that unless a registration statement with respect to the Securities is filed and
declared effective by the Securities and Exchange Commission and the appropriate
state governing agency, the Securities have or will be issued in reliance on
specific exemptions from such registration requirements for transactions by an
issuer not involving a public offering and specific exemptions under state
statutes.  Any disposition of the Securities may, under certain circumstances,
be inconsistent with such exemptions.  The Securities may be offered for sale,
sold, or otherwise transferred only if (i) registered under the Securities Act,
and in come cases, under the applicable state securities acts, or, if not
registered, (ii) only if pursuant to an exemption from such registration
requirements and only after the Optionee provides an opinion of counsel or other
evidence satisfactory to the Company to the effect that registration is not
required.  In some states, specific conditions must be met or approval of the
securities regulatory authorities may be required before any such offer or sale.
The Company is under no obligation to register the Securities with the
Securities and Exchange Commission or any state agency.  If rule 144 is
available (and no assurance is given that it will be), only routine sales of the
Common Stock in limited amounts can be made after two years following the
acquisition date of the Securities, as determined under rule 144(d), in
accordance with the terms and conditions of rule 144.  The Company is under no
obligation to make rule 144 available.  In the event rule 144 is not available,
compliance with regulation A or some other disclosure exemption may be required
before the Optionee can sell, transfer, or otherwise dispose of the Securities
without registration.  The Company and its registrar and transfer agent will
maintain a stop transfer order against the transfer of the Securities, and this
Option and any other certificate or agreement representing the Securities is
subject to the following legend:

     THE SECURITIES REPRESENTED BY THIS OPTION, AGREEMENT, OR CERTIFICATE
     HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
     (THE "SECURITIES ACT"), AND ARE "RESTRICTED SECURITIES" WITHIN THE
     MEANING OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT.  THE
     SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR
     TRANSFERRED WITHOUT COMPLYING WITH RULE 144 IN THE ABSENCE OF AN
     EFFECTIVE REGISTRATION OR OTHER COMPLIANCE UNDER THE SECURITIES ACT.

     The Company may refuse to transfer the Securities to any transferee who
does not furnish in writing to the Company the same representations and
warranties set forth in this paragraph and agree to the same conditions with
respect to such Securities as are set forth herein.  The Company may further
refuse to transfer the Securities if certain circumstances are present
reasonably indicating that the proposed transferee's representations are not
accurate.  In any event, the Company may refuse to consent to any transfer in
the absence of an opinion of legal counsel, satisfactory to and independent of
counsel of the Company, that such proposed transfer is consistent with the above
conditions and applicable securities laws.

     11.  Regulatory Compliance.  If the board of directors of the Company, in
its sole discretion, shall determine that it is necessary or desirable to list,
register, or qualify the Common Stock under any state or federal law, this
Option may not be exercised, in whole or part, until such listing, registration,
or qualification shall have been obtained free of any conditions not acceptable
to the board of directors. If no registration statement is effective on the date
of exercise of this Option, the shares of Common Stock will not be issued unless
and until there is available to the Company evidence, including representations
from the Optionee, that such shares are being acquired for investment and not
for resale,  on which the Company may reasonably rely as to the availability of
an exemption from registration in issuing such Common Stock.  The Company shall
utilize its best efforts to comply with the requirements of each regulatory
commission or agency having jurisdiction in order to issue and sell the Common
Stock to satisfy the Option.  Such compliance will be a condition precedent to
the right to exercise the Option.  The inability of the Company to effect such
compliance with any such regulatory commission or agency which counsel for the
Company deems necessary for the lawful issuance and sale of the Common Stock to
satisfy this Option shall relieve the Company from any liability for failure to
issue and sell the Common Stock to satisfy the Option for such period of time as
such compliance is not effectuated.

     12.  Assignment of Option.  This Option may not be assigned by the Optionee
without the prior written consent of the Company.  If the Company consents to
any assignment, it shall, upon request and upon surrender of this Option by the
Optionee at the principal office of the Company accompanied by payment of all
transfer taxes, if any, payable in connection therewith, transfer this Option on
the books of the Company.  If the assignment is in whole, the Company shall
execute and deliver a new option of like tenor to this Option to the appropriate
assignee expressly evidencing the right to purchase the aggregate number of
Shares of Common Stock purchasable hereunder as of the date of such assignment;
and if the assignment is in part, the Company shall execute and deliver to the
appropriate assignee a new option of like tenor expressly evidencing the right
to purchase the portion of the aggregate number of Shares of Common Stock as
shall be contemplated by any such agreement, and shall concurrently execute and
deliver to the Optionee a new option of like tenor to this Option evidencing the
right to purchase the remaining portion of the Shares of Common Stock
purchasable hereunder which have not been transferred to the assignee. On such
transfer, every holder hereof agrees that the Company may deem and treat the
registered holder of this Option as the true and lawful owner thereof for all
purposes, and the Company shall not be affected by any notice to the contrary.
Neither this Option nor any right hereunder shall be subject to lien,
attachment, execution, or similar process.  In the event of any alienation,
assignment, pledge, hypothecation, or other transfer of this Option or any right
hereunder or in the event of any levy, attachment, execution, or similar
process, this Option and all rights granted hereunder shall be immediately null
and void.

     13.  Withholding.  The Company may, in its sole discretion, satisfy any
obligation to withhold income and employment taxes resulting from the grant or
exercise of this Option (or any other event giving rise to such obligation) in
any of the following ways:

          (a)  The Company may require the Optionee to deliver to the Company at
     the time of exercise of this Option an amount of cash equal to such
     withholding obligation.

          (b)  If authorized by the action of the board of directors of the
     Company (or a duly appointed committee of the board) upon request by the
     Optionee, the Company may defer payment of the withholding obligation for a
     reasonable period to allow the Optionee an opportunity to sell Shares
     issuable on the exercise of this Option.  In the event of such deferral,
     the Optionee hereby grants to the Company a continuing security interest in
     such Shares and all proceeds thereof and appoints the President of the
     Company, and any successor thereto, as attorney-in-fact to sell the number
     of Shares and collect the proceeds therefrom as may be necessary, in the
     opinion of the Company, to satisfy all obligations for the payment of such
     taxes.

          (c)  The Company may withhold from any compensation or other amount
     owing to Optionee the amount (in cash, Common Stock, or other property as
     the Company may determine) of the withholding obligation.

          (d)  If authorized by the action of the board of directors of the
     Company (or a duly appointed committee of the board) upon request by the
     Optionee, the Company may withhold a number of Shares otherwise deliverable
     upon exercise of this Option having a value, determined in accordance with
     the provisions of this Option, equivalent to the amount of such withholding
     obligation.

In all events, delivery of Shares issuable on exercise of this Option shall be
conditioned upon and subject to the satisfaction or making provision for the
satisfaction of the withholding obligation of the Company resulting from the
exercise of this Option. The Company is hereby further authorized to take such
other action as may be necessary, in the opinion of the Company, to satisfy all
obligations for the payment of such taxes.

     14.  Validity and Construction.  The validity and construction of this
Option shall be governed by the laws of the state of Nevada.

     EXECUTED as of the date first above written.

                                    The Company:

                                          FORELAND CORPORATION


                                          By
                                                Duly Authorized Officer

                                    Optionee:


                                    EXHIBIT A


                                FORM OF EXERCISE
                   (TO BE SIGNED ONLY UPON EXERCISE OF OPTION)




TO:  FORELAND CORPORATION


     The undersigned, the owner of the attached Option, hereby irrevocably
elects to exercise the purchase rights represented by the Option for, and to
purchase thereunder,         shares of Common Stock of Foreland Corporation.
Enclosed is payment in the amount of $       , the exercise price of the Common
Stock to be acquired, in the form of  [insert description of manner of payment]
                                                                              .
Please have the certificate(s) registered in the name of
                                             , social security no.
                      and delivered to the following address:

    .  If this exercise does not include all of the Common Stock covered by the
attached Option, please deliver a new option of like tenor for the balance of
the Common Stock to the undersigned at the foregoing address.

     DATED this       day of               , 199 .




                                          Signature of Optionee (Signature must
                                          be
                                          guaranteed by a bank or securities
                                          broker-dealer)
Signature Guarantee:

<PAGE>

SCHEDULE TO FORM OF OPTION AGREEMENT
<TABLE>
<CAPTION>
    Name      Date of Grant   Shares   Exercise         Vesting         Expiration
                                        Price
<S>          <C>            <C>        <C>     <C>                    <C>
Grant Steele  Sept. 1, 1996   200,000     $5.00  25% on grant, 25%     Seven years
                                                 on each anniversary   from vesting
Tom Steele    Sept. 1, 1996   200,000     $5.00  25% on grant, 25%     Seven years
                                                 on each anniversary   from vesting
Ken Ransom    Sept. 1, 1996   200,000     $5.00  25% on grant, 25%     Seven years
                                                 on each anniversary   from vesting
Bruce Decker  Sept. 1, 1996   200,000     $5.00  25% on grant, 25%     Seven years
                                                 on each anniversary   from vesting
</TABLE>