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                                                                  EXHIBIT 10.11


                              EMPLOYMENT AGREEMENT

         THIS AGREEMENT is made and entered into this 15th day of December,
1997 (the "EFFECTIVE DATE") by and between Queen Sand Resources (Canada) Inc.,
a corporation formed under the laws of Ontario (the "COMPANY"), and Edward J.
Munden (the "EXECUTIVE"), having a mailing address at 21 Dayton Crescent,
Nepean, Ontario, Canada K2H 1H9.


                                    RECITALS

         The Executive possesses extensive knowledge of the business and
affairs of the Company, its policies, methods, personnel, and plans for the
future.

         The Board has determined that it is in the best interests of the
Company to assure that the Company will have the continued dedication of the
Executive, notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined in Section 5 hereof).  The Board believes it is imperative
to retain the Executive's services, to diminish the inevitable distraction of
the Executive by virtue of the personal uncertainties and risks created by a
pending or threatened Change of Control and to encourage the Executive's full
attention and dedication to the Company currently and in the event of any
threatened or pending Change of Control, and to provide the Executive with
compensation and benefits arrangements upon a Change of Control.

         The Company wishes to protect the Executive from loss of compensation
and benefits if his continued employment is no longer possible through no fault
of the Executive.

         The Executive is desirous of committing himself to serve the Company
on the terms herein provided.

         NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties agree as follows:


                                   AGREEMENT

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Company and the Executive hereby agree as
follows:

         1.      EMPLOYMENT.  Upon the terms and subject to the conditions
contained in this Agreement, the Executive agrees to provide full-time services
for the Company during the Employment Period (as defined below).  The Executive
agrees to devote his best efforts to the business of the Company, and shall
perform his duties in a diligent, trustworthy and business-like manner, all for
the purpose of advancing the business of the Company.

         2.      DUTIES.  The Executive shall have the titles of Chairman of
the Board, Chief Executive Officer and President and shall have the duties that
are customarily attendant to such offices and such other duties as are from
time to time assigned by the Board of Directors.  During the Employment Period,
the Executive's position (including status, offices, titles and reporting
requirements), authority, duties and responsibilities shall be at least
commensurate in all material respects with the most significant of those held,
exercised and assigned at any time during the 90-day period immediately
preceding the Effective Date.


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During the Employment Period, and excluding any periods of vacation and sick
leave to which the Executive is entitled, the Executive agrees to devote
reasonable attention and time during normal business hours to the business and
affairs of the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, to use the Executive's
reasonable best efforts to perform faithfully and efficiently such
responsibilities.  During the Employment Period it shall not be a violation of
this Agreement for the Executive to (A) serve on corporate, civic or charitable
boards or committees, (B) deliver lectures, fulfill speaking engagements or
teach at educational institutions and (C) manage personal investments, so long
as such activities do not significantly interfere with the performance of the
Executive's responsibilities as an employee of the Company in accordance with
this Agreement.  It is expressly understood and agreed that to the extent that
any such activities have been conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or the conduct of activities
similar in nature and scope thereto) subsequent to the Effective Date shall not
thereafter be deemed to interfere with the performance of the Executive's
responsibilities to the Company.  Notwithstanding anything herein to the
contrary it is acknowledged and agreed that the Executive may hold positions as
director, officer or employee of Capital House A Finance and Investment
Corporation and any corporation associated therewith; provided, that such
activities do not impair the performance by Executive of his duties hereunder
or otherwise interfere with Executive's compliance with his obligations set
forth in the preceding sentence.

         3.      EMPLOYMENT PERIOD.  Subject to the terms and conditions
hereof, the Company agrees to employ the Executive for a term (the "EMPLOYMENT
PERIOD") commencing as of the Effective Date and terminating on June 30, 2002.

         4.      SALARY AND BENEFITS.  The salary and benefits of the Executive
hereunder are as set forth on Exhibit A attached hereto.

         5.      TERMINATION OF EMPLOYMENT.  The Board of Directors of the
Company may terminate the employment of the Executive at any time as it deems
appropriate.

                 (a)              Termination Without Cause; Resignation for
         Good Reason.  If during the term of this Agreement, (i) the
         Executive's employment is terminated by the Company without Cause
         (defined below) or (ii) the Executive voluntarily terminates his
         employment during the Employment Period for Good Reason, then the
         Company shall  pay the Executive (in a lump sum) an amount equal to
         the sum of (x) the Base Salary for one year in effect immediately
         prior to the termination and (y) the amount of the Bonus that would
         have been payable to the Executive for such year, prorated to the
         Termination Date, and the Company shall issue to the Executive a
         number of stock options that the Executive would have been entitled to
         receive for that year, prorated to the Termination Date.

                 For purposes of this Agreement, "GOOD REASON" shall mean:

                          (i)              Without his express written consent,
                 the assignment to the Executive of any duties materially
                 inconsistent with his positions, duties, responsibilities and
                 status with the Company as of the Effective Date, or a
                 substantial reduction in his reporting responsibilities,
                 titles or offices as of the Effective Date, or any removal of
                 the Executive from or any failure to re-elect the Executive to
                 any of such positions, except in connection with the
                 termination of his employment for Cause, Disability (defined
                 below) or as a result of his death or by the Executive other
                 than for Good Reason;





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                          (ii)             A reduction by the Company in the
                 Executive's Base Salary (as defined in Exhibit A attached
                 hereto) as in effect immediately prior to the Effective Date
                 or as the same may be increased from time to time;

                          (iii)            A reduction by the Company in the
                 amounts payable under the Company's annual incentive plan
                 unless such reduction affects all executive officers of the
                 Company and does not result in a proportionately greater
                 reduction in the rights of or benefits to the Executive as
                 compared with any other executive officer of the Company;

                          (iv)             The failure by the Company to
                 continue in effect any benefit or compensation plan (including
                 but not limited to any stock option plan, pension plan, life
                 insurance plan, health and accident plan or disability plan)
                 in which the Executive from time to time participates (or
                 plans providing substantially similar benefits, and whether by
                 or through the Company or another member of the Company
                 Group), the taking of any action by the Company which would
                 adversely affect the Executive's participation in or
                 materially reduce his benefits under any of such plans or
                 deprive him of any material fringe benefit enjoyed by him, or
                 the failure by the Company to provide the Executive with the
                 number of paid vacation days to which he is then entitled on
                 the basis of years of service with the Company in accordance
                 with the Company's normal vacation policy in effect
                 immediately prior to the Effective Date except for such
                 changes in benefits that affect all executive officers of the
                 Company and do not result in a proportionately greater
                 reduction in the rights of or benefits to the Executive as
                 compared with any other executive officer of the Company;

                          (v)              Any failure of the Company to obtain
                 the assumption of, or the agreement to perform, this Agreement
                 by any successor as contemplated in Section 13(a) hereof; or

                          (vi)             Any purported termination of the
                 Executive's employment which is not effected pursuant to a
                 notice of termination satisfying the requirements of Section
                 5(b) or 5(d) hereof; and for purposes of this Agreement, no
                 such purported termination shall be effective.

                 (b)              Voluntary Resignation or Termination for
         Cause.  If the Executive shall voluntarily terminate his employment
         for other than Good Reason or if the Company shall discharge the
         Executive for Cause, this Agreement shall terminate immediately and
         the Company shall have no further obligation to make any payment under
         this Agreement except that the Company shall pay the Executive
         accrued but unpaid salary, bonuses and benefits pursuant to Section 4
         hereof through the Date of Termination.

                 For the purposes of this Agreement, the Company shall have
         "CAUSE" to terminate the Executive's employment hereunder upon (A) the
         willful and continued failure by the Executive to substantially
         perform his duties with the Company (other than any such failure
         resulting from incapacity due to physical or mental illness), and such
         failure is not remedied in a reasonable time after a written Nothing
         to report.demand for substantial performance is delivered to the
         Executive by the Board which specifically identifies the manner in
         which the Board believes that he has not substantially performed his
         duties, or (B) the final, nonappealable conviction of a felony. For





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         purposes of this paragraph, no act, or failure to act, on the
         Executive's part shall be considered "WILLFUL" unless done, or omitted
         to be done, by him not in good faith and without reasonable belief
         that his action or omission was not in the best interest of the
         Company.  Notwithstanding the foregoing, the Executive shall not be
         deemed to have been terminated for Cause under (A) above unless and
         until there shall have been delivered to him a copy of a resolution
         duly adopted by the affirmative vote of not less than two-thirds (2/3)
         of the entire authorized membership of the Board at a meeting of the
         Board called and held for the purpose (after reasonable notice and an
         opportunity for the Executive, together with counsel, to be heard
         before the Board), finding that in the good faith opinion of the Board
         he was guilty of conduct set forth above in clause (A) of the first
         sentence of this paragraph and specifying the particulars thereof in
         detail.

                 (c)              Termination After Change of Control.  If,
         within six (6) months after a Change of Control (defined below), the
         Company shall terminate the Executive's employment other than pursuant
         to Section 3 or 5(b) hereof or if the Executive shall terminate his
         employment for Good Reason, then the Company shall pay to the
         Executive as severance pay in a lump sum not later than the tenth
         (10th) day following the Date of Termination, the following amounts:

                          (i)              The Executive's full Base Salary
                 through the Date of Termination at the rate in effect at the
                 time of notice of termination is given;

                          (ii)             In lieu of any further salary
                 payments to the Executive for periods subsequent to the Date
                 of Termination, an amount equal to the sum of (x) the Base
                 Salary for one year in effect immediately prior to the
                 termination and (y) the amount of the Bonus that would have
                 been payable to the Executive for such year, prorated to the
                 Termination Date and the Company shall issue to the Executive
                 a number of stock options that the Executive would have been
                 entitled to receive for that year, prorated to the Termination
                 Date;

                          (iii)            In lieu of shares of common stock of
                 Queen Sand Resources, Inc. a Delaware corporation ("QSR-DE"),
                 par value $.0015 per share ("QSR-DE SHARES") issuable upon
                 exercise of options ("OPTIONS"), if any, granted to the
                 Executive under any stock option plan of QSR-DE (which Options
                 shall be canceled upon the making of the payment referred to
                 below), the Executive shall receive an amount in cash equal to
                 the aggregate spread between the exercise prices of all
                 Options held by the Executive whether or not then fully
                 exercisable, and the highest price per QSR-DE Share of Common
                 Stock actually paid (including the fair market value of
                 non-cash consideration per QSR-DE Share received) in
                 connection with any change in control of QSR-DE (such price
                 being hereinafter referred to as "TERMINATION PRICE"); and

                          (iv)             The Company shall also pay all
                 reasonable legal fees and expenses incurred by the Executive
                 as a result of such termination (including all such reasonable
                 fees and expenses, if any, incurred in contesting or disputing
                 any such termination or in seeking to obtain or enforce any
                 right or benefit provided by this Agreement).





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        "CHANGE OF CONTROL" means any of the following:

                          (i)     any consolidation or merger of QSR-DE in
                 which QSR-DE is not the continuing or surviving corporation or
                 pursuant to which shares of QSR-DE's common stock would be
                 converted into cash, securities or other property, other than
                 a merger of QSR-DE in which the holders of QSR-DE's common
                 stock immediately prior to the merger have the same
                 proportionate ownership of common stock of the surviving
                 corporation immediately after the merger;

                          (ii)    any sale, lease, exchange or other transfer
                 (in one transaction or a series of related transactions) of
                 all or substantially all of the assets of QSR-DE;

                          (iii)   any approval by the stockholders of QSR-DE of
                 any plan or proposal for the liquidation or dissolution of
                 QSR-DE;

                          (iv)    the cessation of control (by virtue of their
                 not constituting a majority of directors) of QSR-DE's Board of
                 Directors by the individuals (the "CONTINUING DIRECTORS") who
                 (x) at the date of this Agreement were directors or (y) become
                 directors after the date of this Agreement and whose election
                 or nomination for election by QSR-DE's stockholders, was
                 approved by a vote of at least two-thirds of the directors
                 then in office who were directors at the date of this
                 Agreement or whose election or nomination for election was
                 previously so approved);

                          (v)     (A) the acquisition of beneficial ownership
                 (within the meaning of Rule 13d-3 under the Securities
                 Exchange Act of 1934, as amended ("BENEFICIAL OWNERSHIP")) of
                 an aggregate of 15% of the voting power of QSR-DE's
                 outstanding voting securities by any person or group (as such
                 term is used in Rule 13d-5 under such Act) who Beneficially
                 Owned less than 10% of the voting power of QSR-DE's
                 outstanding voting securities on the date hereof, (B) the
                 acquisition of Beneficial Ownership of an additional 5% of the
                 voting power of QSR-DE's outstanding voting securities by any
                 person or group who Beneficially Owned at least 10% of the
                 voting power of QSR-DE's outstanding voting securities on the
                 date hereof, or (C) the execution by QSR-DE and a stockholder
                 of a contract that by its terms grants such stockholder (in
                 its, hers or his capacity as a stockholder) or such
                 stockholder's Affiliate (as defined in Rule 405 promulgated
                 under the Securities Act of 1933 (an "AFFILIATE")) including,
                 without limitation, such stockholder's nominee to the Board of
                 Directors (in its, hers or his capacity as an Affiliate of
                 such stockholder), the right to veto or block decisions or
                 actions of the Board of Directors; provided, however, that
                 notwithstanding the foregoing, the events described in items
                 (A), (B) or (C) above shall not constitute a Change in Control
                 hereunder if the securityholder is (aa) a trustee or other
                 fiduciary holding securities under an employee benefit plan of
                 QSR-DE and acting in such capacity, (bb) a corporation owned,
                 directly or indirectly, by the stockholders of QSR-DE in
                 substantially the same proportions as their ownership of
                 voting securities of QSR-DE or (cc) in the case of an
                 acquisition described in items (A) or (B) above (but not in
                 the case of an acquisition described in item (C) above), any
                 other person whose acquisition of shares of voting securities
                 is approved in advance by a majority of the Continuing





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                 Directors; provided further, however that none of the
                 following shall constitute a Change in Control: (aa) the right
                 of the holders of any voting securities of QSR-DE to vote as a
                 class on any matter or (bb) any vote required of disinterested
                 or unaffiliated directors or stockholders including, without
                 limitation, pursuant to Section 144 of the Delaware General
                 Corporation Law or Rule 16b-3 promulgated pursuant to the
                 Securities Exchange Act of 1934; or

                          (vi)    subject to applicable law, in a Chapter 11
                 bankruptcy proceeding, the appointment of a trustee or the
                 conversion of a case involving QSR-DE to a case under Chapter
                 7.

                (d)       Disability.  The Company may terminate this Agreement
         for Disability. If the Company shall terminate the Executive's
         employment for Disability, the Company's obligation to pay salary,
         bonuses and benefits pursuant to Section 4 hereof shall terminate,
         except that the Company shall pay the Executive (i) accrued but unpaid
         salary and benefits pursuant to Section 4 hereof through the Date of
         Termination, and (ii) the benefits set forth in Section 5(e) hereof. 
         The Company also shall make any additional payments necessary to
         provide the disability benefits set forth in Exhibit A attached
         hereto. "DISABILITY" shall exist if because of ill health, physical
         or mental disability, or any other reason beyond his control, and
         notwithstanding reasonable accommodations made by the Company, the
         Executive shall have been unable, unwilling or shall have failed to
         perform his duties under this Agreement, as determined in good faith
         by the Compensation Committee of the Company's Board of Directors, for
         a period of 180 consecutive days, or if, in any 12-month period, the
         Executive shall have been unable or unwilling or shall have failed to
         perform his duties for a period of 270 days, irrespective of whether
         or not such days are consecutive.

                (e)      Employee Benefits.  Unless the Executive's employment
         is terminated pursuant to Section 5(b)hereof, the Company shall 
         maintain in full force and effect (to the extent consistent with past
         practice), for the continued benefit of the Executive and, if
         applicable, the Executive's spouse and children, the employee benefits
         set forth in [subsections (d) ("LIFE INSURANCE"), (e) ("DISABILITY
         INSURANCE"), (f) ("MEDICAL EXPENSES") and (h) ("FRINGE BENEFITS AND
         PERQUISITES")] of Exhibit A attached hereto that he was entitled to
         receive immediately prior to the Date of Termination (subject to the
         general terms and conditions of the plans and programs under which he
         receives such benefits) for the balance of the Employment Period
         notwithstanding the termination hereof or for the period provided for
         under the terms and conditions of such plans and programs, whichever
         is longer, provided that his continued participation or, if
         applicable, the participation of the Executive's spouse and children,
         is possible under the general terms and conditions of such plans and
         programs.

                 (f)     Notice of Termination.  Any termination by the Company
         or by the Executive shall be communicated by Notice of Termination to
         the other party thereto given in accordance with Section 13(c) hereof. 
         For purposes of this Agreement, a "NOTICE OF TERMINATION" means a
         written notice which (i) indicates the specific termination provision
         in this Agreement relied upon, (ii) to the extent applicable, sets
         forth in reasonable detail the facts and circumstances claimed to
         provide a basis for termination of the Executive's employment under
         the provision so indicated and (iii) if the Date of Termination (as
         defined below) is other than the date of receipt of such notice,
         specifies the termination date (which date shall be not more than
         fifteen (15)





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         days after the giving of such notice). The failure by the Executive
         or the Company to set forth in the Notice of Termination any fact or
         circumstance which contributes to a showing of Good Reason, Cause or
         Disability shall not waive any right of the Executive or the Company
         hereunder or preclude the Executive or the Company from asserting such
         fact or circumstance in enforcing the Executive's or the Company's
         rights hereunder.

                 (g)     Date of Termination.  "DATE OF TERMINATION" means (i)
         if the Executive's employment is terminated by the Company for Cause
         or Disability  or by the Executive for Good Reason or within six (6)
         months after a Change of Control, the date of receipt of the Notice of
         Termination or any later date specified therein, as the case may be,
         (ii) if the Executive's employment is terminated by the Company or
         other than for Cause, the Date of Termination shall be the date on
         which the Company notifies the Executive of such termination and (iii)
         if the Executive's employment is terminated by reason of death, the
         Date of Termination shall be the date of death of the Executive.

                 (h)     Mitigation of Amounts Payable Hereunder. The
         Executive shall not be required to mitigate the amount of any payment
         provided for in this Section 5 by seeking other employment or
         otherwise, nor shall the amount of any payment provided for in this
         Section 5 be reduced by any compensation earned by the Executive as
         the result of employment by another employer after the Date of
         Termination, or otherwise.

         6.      DEATH OF THE EXECUTIVE.  If the Executive dies prior to the
end of Employment Period, the Executive's employment and other obligations
under this Agreement shall automatically terminate and all compensation, to
which the Executive is or would have been entitled hereunder (including without
limitation under subsections (a) ("BASE SALARY"), (b) ("BONUS") and (c) ("STOCK
OPTIONS") of Exhibit A attached hereto), shall terminate as of the end of the
month in which the Executive's death occurs; provided, however, that (i) the
Company shall pay to the Executive's estate, as soon as practicable, a prorated
Annual Incentive Payment, if earned in accordance with the Company's annual
incentive plan; (ii) for the balance of the Employment Period, the Executive's
spouse and children shall be entitled to receive their benefits under the
Company's group hospitalization, medical and dental plans (if any); and (iii)
the Executive's named beneficiary or beneficiaries shall receive the benefits
payable pursuant to subsection (d) ("LIFE INSURANCE") of Exhibit A attached
hereto and such reimbursement as may have been due to the Executive pursuant to
subsection (g) ("PAYMENT AND REIMBURSEMENT OF EXPENSES") of Exhibit A attached
hereto.

         7.      CONFIDENTIAL INFORMATION. The Executive recognizes and
acknowledges that he will have access to certain information of members of the
Company Group (as defined below) and that such information is confidential and
constitutes valuable, special and unique property of such members of the
Company Group.   The Executive shall not at any time, either during or
subsequent to the term of this Agreement, disclose to others, use, copy or
permit to be copied, except in pursuance of his duties for and on behalf of the
Company, it successors, assigns or nominees, any Confidential Information of
any member of the Company Group (regardless of whether developed by the
Executive) without the prior written consent of the Company.  As used herein,
"COMPANY GROUP" means the Company, and any entity that directly or indirectly
controls, is controlled by, or is under common control with, the Company.  For
purposes hereof, "CONTROL" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
entity, whether through the ownership of voting securities, by contract or
otherwise.  The term





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"CONFIDENTIAL INFORMATION" with respect to any person means any secret or
confidential information or know-how and shall include, but shall not be
limited to, the plans, customers, costs, prices, uses, and applications of
products and services, results of investigations, studies or experiments owned
or used by such person, and all apparatus, products, processes, compositions,
samples, formulas, computer programs, computer hardware designs, computer
firmware designs, and servicing, marketing or manufacturing methods and
techniques at any time used, developed, investigated, made or sold by such
person, before or during the term of this Agreement, that are not readily
available to the public or that are maintained as confidential by such person.
The Executive shall maintain in confidence any Confidential Information of
third parties received as a result of his employment with the Company in
accordance with the Company's obligations to such third parties and the
policies established by the Company.

         8.      DELIVERY OF DOCUMENTS UPON TERMINATION.  The Executive shall
deliver to the Company or its designee at the termination of his employment all
correspondence, memoranda, notes, records, drawings, sketches, plans, customer
lists, product compositions, and other documents and all copies thereof, made,
composed or received by the Executive, solely or jointly with others, that are
in the Executive's possession, custody, or control at termination and that are
related in any manner to the past, present, or anticipated business or any
member of the Company Group.  In this regard, the Executive hereby grants and
conveys to the Company all right, title and interest in and to, including
without limitation, the right to possess, print, copy, and sell or otherwise
dispose of, any reports, records, papers, summaries, photographs, drawings or
other documents, and writings, and copies, abstracts or summaries thereof, that
may be prepared by the Executive or under his direction or that may come into
his possession in any way during the term of his employment with the Company
that relate in any manner to the past, present or anticipate business of any
member of the Company Group.

         9.      FURTHER ACTS.  At the request of the Company (but without
additional compensation from the Company during his employment by the Company)
the Executive shall execute any and all papers and perform all lawful acts that
the Company may deem necessary or appropriate to further evidence or carry out
the transactions contemplated in this Agreement including, without limitation,
such acts as may be necessary for the preparation, filing, prosecution, and
maintenance of applications for United States letters patent and foreign
letters patent, or for United States and foreign copyright, on the
Developments.

         10.     NO COMPETITION.  Throughout the term of the Agreement and,
unless the Agreement terminates pursuant to Section 3, 5(a) or 5(c), through
the first anniversary of the expiration thereof, the Executive shall not
directly or indirectly engage in the business of acquiring oil and natural gas
reserves and oil and natural gas production and exploitation; or any other
business in which any member of the Company Group directly or indirectly
engages during the term of the Agreement; provided, however, that the
restriction in this Section 10 shall apply only to the reasonable and limited
geographic area consisting of any state in which any member of the Company
Group directly or indirectly has offices, operations, or customers, or
otherwise conducts business; and provided further that if the Agreement
terminates pursuant to Section 5(b), the Executive shall be subject to the
provisions of this Section 10 only if the Company pays the Executive in a lump
sum an amount equal to the annual Base Salary in effect at the Date of
Termination.  For purposes of this Section 10, the Executive shall be deemed to
engage in a business if he directly or indirectly, engages or invests in, owns,
manages, operates, controls or participates in the ownership, management,
operation or control of, is employed by, associated or in any manner





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<PAGE>   9
connected with, or renders services or advice to, any business engaged in
acquiring oil and natural gas reserves and oil and natural gas production and
exploitation; provided, however, that the Executive may invest in the
securities of any enterprise (but without otherwise participating in the
activities of such enterprise) if (x) such securities are listed on any
national or regional securities exchange or have been registered under Section
12(g) of the Securities Exchange Act of 1934 and (y) the Executive does not
beneficially own (as defined Rule 13d-3 promulgated under the Securities
Exchange Act of 1934) in excess of 5% of the outstanding capital stock of such
enterprise;

         The Executive agrees that if a court of competent jurisdiction
determines that the length of time or any other restriction, or portion
thereof, set forth in this Section 10 is overly restrictive and unenforceable,
the court may reduce or modify such restrictions to those which it deems
reasonable and enforceable under the circumstances, and as so reduced or
modified, the parties hereto agree that the restrictions of this Section 10
shall remain in full force and effect. The Executive further agrees that if a
court of competent jurisdiction determines that any provision of this Section
10 is invalid or against public policy, the remaining provisions of this
Section 10 and the remainder of this Agreement shall not be affected thereby,
and shall remain in full force and effect.

         The Executive acknowledges that the business of the Company and the
other members of the Company Group is southwest United States in scope and that
the restrictions imposed by this Agreement are legitimate, reasonable and
necessary to protect the Company's and its affiliates' investment in their
businesses and the goodwill thereof.  The Executive acknowledges that the scope
and duration of the restrictions contained herein are reasonable in light of
the time that the Executive has been engaged in the business of the Company and
the other members of the Company Group, the Executive's reputation in the
markets for the Company's and the businesses of the other members of the
Company Group and the Executive's relationship with the suppliers, customers
and clients of the Company and the other members of the Company Group.  The
Executive further acknowledges that the restrictions contained herein are not
burdensome to the Executive in light of the consideration paid therefor and the
other opportunities that remain open to the Executive.  Moreover, the Executive
acknowledges that he has other means available to him for the pursuit of his
livelihood.

         11.     REMEDIES.  The Executive acknowledges that a remedy at law for
any breach or attempted breach of the Executive's obligations under Sections 7
through 10 hereof may be inadequate, agrees that the Company may be entitled to
specific performance and injunctive and other equitable remedies in case of any
such breach or attempted breach, and further agrees to waive any requirement
for the securing or posting of any bond in connection with the obtaining of any
such injunctive or other equitable relief.  The Company shall have the right to
offset against amounts to be paid to the Executive pursuant to the terms hereof
any amounts from time to time owing by the Executive to the Company.  The
termination of the Agreement pursuant to Section 3, 5(b) or 5(d) hereof shall
not be deemed to be a waiver by the Company of any breach by the Executive of
this Agreement or any other obligation owed the Company, and notwithstanding
such a termination the Executive shall be liable for all damages attributable
to such a breach.





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<PAGE>   10
         12.     DISPUTE RESOLUTION.  Subject to the Company's right to seek
injunctive relief in court as provided in Section 11 hereof, any dispute,
controversy or claim arising out of or in relation to or connection to this
Agreement, including without limitation any dispute as to the construction,
validity, interpretation, enforceability or breach of this Agreement, shall be
exclusively and finally settled by arbitration, and any party may submit such
dispute, controversy or claim, including a claim for indemnification under this
Section 12, to arbitration.

                 (a)      Arbitrators.  The arbitration shall be heard and
         determined by one arbitrator, who shall be impartial and who shall be
         selected by mutual agreement of the parties.  If the parties cannot
         agree on the sole arbitrator, then the appointing authority for the
         implementation of such procedure shall be the Senior United States
         District Judge for the Northern District of Texas, who shall appoint
         an independent arbitrator who does not have any financial interest in
         the dispute, controversy or claim.  If the Senior United States
         District Judge for the Northern District of Texas refuses or fails to
         act as the appointing authority within ninety (90) days after being
         requested to do so, then the appointing authority shall be the Chief
         Executive Officer of the American Arbitration Association, who shall
         appoint an independent arbitrator who does not have any financial
         interest in the dispute, controversy or claim.  All decisions and
         awards by the arbitration tribunal shall be made by majority vote.

                 (b)      Proceedings.  Unless otherwise expressly agreed in
         writing by the parties to the arbitration proceedings:

                          (i)     The arbitration proceedings shall be held in
                 Dallas, Texas, at a site chosen by mutual agreement of the
                 parties, or if the parties cannot reach agreement on a
                 location within thirty (30) days of the appointment of the
                 last arbitrator, then at a site chosen by the arbitrators;

                          (ii)    The arbitrators shall be and remain at all
                 times wholly independent and impartial;

                          (iii)   The arbitration proceedings shall be
                 conducted in accordance with the Commercial Arbitration Rules
                 of the American Arbitration Association, as amended from time
                 to time;

                          (iv)    Any procedural issues not determined under
                 the arbitral rules selected pursuant to item (iii) above shall
                 be determined by the law of the place of arbitration, other
                 than those laws which would refer the matter to another
                 jurisdiction;

                          (v)     The decision of the arbitrators shall be
                 reduced to writing; final and binding without the right of
                 appeal; the sole and exclusive remedy regarding any claims,
                 counterclaims, issues or accounting presented to the
                 arbitrators; made and promptly paid in United States dollars
                 free of any deduction or offset; and any costs or fees
                 incident to enforcing the award shall, to the maximum extent
                 permitted by law, be charged against the party resisting such
                 enforcement;

                          (vi)    The award shall include interest from the
                 date of any breach or violation of this Agreement, as
                 determined by the arbitral award, and from the





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<PAGE>   11
                 date of the award until paid in full, at the applicable
                 Federal rate provided for in Section 7872(f)(2)(A) of the
                 Code; and

                          (vii)   Judgment upon the award may be entered in any
                 court having jurisdiction over the person or the assets of the
                 party owing the judgment or application may be made to such
                 court for a judicial acceptance of the award and an order of
                 enforcement, as the case may be.

                 (c)      Acknowledgment Of Parties.  Each party acknowledges
         that he or it has voluntarily and knowingly entered into an agreement
         to arbitration under this Section by executing this Agreement.

         13.     MISCELLANEOUS PROVISIONS.

                 (a)      Successors of the Company.  The Company will require
         any successor (whether direct or indirect, by purchase, merger,
         consolidation or otherwise) to all or substantially all of the
         business and/or assets of the Company, by agreement in form and
         substance satisfactory to the Executive, expressly to assume and agree
         to perform this Agreement in the same manner and to the same extent
         that the Company would be required to perform it if no such succession
         had taken place.  Failure of the Company to obtain such agreement
         prior to the effectiveness of any such succession shall be a breach of
         this Agreement and shall entitle the Executive to compensation from
         the Company in the same amount and on the same terms as the Executive
         would be entitled hereunder if the Executive terminated his employment
         for Good Reason, except that for purposes of implementing the
         foregoing, the date on which any such succession becomes effective
         shall be deemed the Date of Termination.  As used in this Agreement,
         "COMPANY" shall mean the Company as hereinbefore defined and any
         successor to its business and/or assets as aforesaid which executes
         and delivers the agreement provided for in this Section 13(a) or which
         otherwise becomes bound by all the terms and provisions of this
         Agreement by operation of law.

                 (b)      Executive's Heirs, etc.  The Executive may not assign
         his rights or delegate his duties or obligations hereunder without the
         written consent of the Company.  This Agreement shall inure to the
         benefit of and be enforceable by the Executive's personal or legal
         representatives, executors, administrators, successors, heirs,
         distributees, devisees and legatees.  If the Executive should die
         while any amounts would still be payable to him hereunder as if he had
         continued to live, all such amounts, unless other provided herein,
         shall be paid in accordance with the terms of this Agreement to his
         designee or, if there be no such designee, to his estate.

                 (c)      Notice.  For the purposes of this Agreement, notices
         and all other communications provide for in the Agreement shall be in
         writing and shall be deemed to have been duly given when delivered or
         mailed by United States registered or certified mail, return receipt
         requested, postage prepaid, addressed to the respective addresses set
         forth on the first page of this Agreement, provided that all notices
         to the Company shall be directed to the attention of the Chief
         Executive Officer of the Company with a copy to the Secretary of the
         Company, or to such other in writing in accordance herewith, except
         that notices of change of address shall be effective only upon
         receipt.

                 (d)      Amendment; Waiver.  No provisions of this Agreement
         may be modified, waived or discharged unless such waiver, modification
         or discharge is agreed to in





                                       11
<PAGE>   12
         writing signed by the Executive and such officer as may be
         specifically designated by the Board of Directors of the Company.  No
         waiver by either party hereto at any time of any breach by the other
         party hereto of, or compliance with, any condition or provision of
         this Agreement to be performed by such other party shall be deemed a
         waiver of similar or dissimilar provisions or conditions at the same
         or at any prior or subsequent time.  No agreements or representations,
         oral or otherwise, express or implied, with respect to the subject
         matter hereof have been made by either party which are not set forth
         expressly in this Agreement.

                 (e)      Invalid Provisions.  Should any portion of this
         Agreement be adjudged or held to be invalid, unenforceable or void,
         such holding shall not have the effect of invalidating or voiding the
         remainder of this Agreement and the parties hereby agree that the
         portion so held invalid, unenforceable or void shall, if possible, be
         deemed amended or reduced in scope, or otherwise be stricken from this
         Agreement to the extent required for the purposes of validity and
         enforcement thereof.

                 (f)      Survival of the Executive's Obligations.  The
         Executive's obligations under this Agreement shall survive regardless
         of whether the Executive's employment by the Company is terminated,
         voluntarily or involuntarily, by the Company or the Executive, with or
         without Cause.

                 (g)      Counterparts.  This Agreement may be executed in one
         or more counterparts, each of which shall be deemed to be an original
         but all of which together will constitute one and the same instrument.

                 (h)      Governing Law.  This Agreement shall be governed by
         and construed under the laws of the State of Texas.

                 (i)      Captions and Gender.  The use of captions and Section
         headings herein is for purposes of convenience only and shall not
         effect the interpretation or substance of any provisions contained
         herein.  Similarly, the use of the masculine gender with respect to
         pronouns in this Agreement is for purposes of convenience and includes
         either sex who may be a signatory.

                 (j)      Entire Agreement.  This Agreement constitutes the
         entire agreement between the parties hereto with respect to the
         subject matter hereof and supersedes all prior agreements, both
         written and oral, between the parties with respect to the subject
         matter hereof, including, without limitation, the Employment Agreement
         dated May 6, 1997 between QSR-DE and the Executive.

                 (k)      Legal Costs; Payments During Dispute.  The Company
         shall pay promptly as incurred, to the full extent permitted by law,
         all legal fees and expenses which the Executive may reasonably incur
         as a result of any contest (regardless of the outcome thereof) by the
         Company, the Executive or others of the validity or enforceability of,
         or liability under, any provision of this Agreement or any guarantee
         of performance thereof (including as a result of any contest by the
         Executive about the amount of any payment pursuant to this Agreement),
         plus in each case interest on any delayed payment at the applicable
         Federal rate provided for in Section 7872(f)(2)(A) of the Code.  If
         there shall be any dispute between the Company and the Executive (i)
         in the event of any termination of the Executive's employment by the
         Company, whether such termination was for Cause or Disability, or (ii)
         in the event of any termination of employment by the Executive,
         whether Good Reason existed,





                                       12
<PAGE>   13
         then, unless and until there is a final, nonappealable judgment by a
         court of competent jurisdiction or decision of arbitration declaring
         that such termination was for Cause or Disability or that the
         determination by the Executive of the existence of Good Reason was not
         made in good faith, the Company shall pay all amounts, and provide all
         benefits, to the Executive and/or the Executive's family or other
         beneficiaries, as the case may be, that the Company would be required
         to pay or provide pursuant to Section 5 hereof as though such
         termination were by the Company without Cause or Disability or by the
         Executive with Good Reason; provided, however, that the Company shall
         not be required to pay any disputed amounts pursuant to this paragraph
         except upon receipt of an undertaking by or on behalf of the Executive
         to repay all such amounts to which the Executive is ultimately
         adjudged by such court not to be entitled.

                 (l)      Parent Guaranty.  QSR-DE hereby agrees to guaranty
         the performance of the Company's obligations under this Agreement.





                                       13
<PAGE>   14
         IN WITNESS WHEREOF, the parties hereto have signed this Agreement as
of the date first set forth above.

                                             QUEEN SAND RESOURCES (CANADA) INC.


                                             By: /s/    AUTHORIZED SIGNATORY
                                                 -------------------------------
                                                 Name:                      
                                                      --------------------------
                                                 Title:                     
                                                       -------------------------


                                             (EXECUTIVE)


                                             /s/    EDWARD J. MUNDEN
                                             -----------------------------------
                                             Edward J. Munden



ACCEPTED AND AGREED TO:

QUEEN SAND RESOURCES, INC.



By:   /s/   AUTHORIZED SIGNATORY  
      -------------------------------
      Name:                                        
           --------------------------
      Title:                                       
            -------------------------
and

By:   /s/   AUTHORIZED SIGNATORY  
      -------------------------------
      Name:                                        
           --------------------------
      Title:                                       
            -------------------------





                                       14
<PAGE>   15
                                   EXHIBIT A


                              SALARY AND BENEFITS


                (a)     Base Salary.  The Company shall pay the Executive as
         compensation an aggregate salary of $130,000 per year during the
         Employment Period (pro rated for periods less than twelve (12)
         months), or such greater amount as shall be approved by the
         Compensation Committee of the Company's Board of Directors ("BASE
         SALARY").  The Compensation Committee shall review the Executive's
         Base Salary at least annually and in conducting such review shall take
         into consideration the most recent executive compensation assessment
         prepared by an independent compensation consultant to the Company. 
         The Base Salary for each year shall be paid by the Company in
         accordance with the regular payroll practices of the Company.  The
         Company may not reduce the Executive's Base Salary at any time during
         the term hereof.

                (b)     Bonus.  Subject to the provisions of this paragraph
         (b), the Company shall pay the Executive an annual bonus for each
         fiscal year during the Term of this Agreement (the amount of the Bonus
         will be prorated for any period of less than twelve calendar months). 
         Such bonus shall be paid on the last business day of the third month
         following the fiscal year end of the Company during the Term of this
         Agreement.    The Compensation Committee shall review the method of
         determination of the Executive's Bonus at least annually and in
         conducting such review shall take into consideration the most recent
         executive compensation assessment prepared by an independent
         compensation consultant to the Company.

                (c)     Stock Options.  The Company shall grant the Executive
         stock options pursuant to the Queen Sand Resources, Inc. 1997
         Incentive Equity Plan (the "PLAN") on terms and conditions to be
         determined by the Compensation Committee of the Company's Board of
         Directors, and in making such determination shall take into
         consideration the most recent executive compensation assessment
         prepared by an independent compensation consultant to the Company

                 (d)     Life Insurance.  During the Employment Period and
         subject to the Executive's qualification under normal life insurance
         underwriting standards as of the date hereof and at any policy renewal
         date, the Company shall provide, at the Company's expense, a term life
         insurance policy on the life of the Executive for the benefit of such
         beneficiary or beneficiaries as may be designated from time to time by
         the Executive, such policy to be in a face amount as designated by the
         Board of Directors for all executives generally.

                 (e)     Disability Insurance.  During the Employment Period and
         subject to the Executive's qualification under normal disability
         insurance underwriting standards as of the date hereof and at any
         policy renewal date, the Company shall provide, at the Company's
         expense, a disability insurance policy with such terms that are
         designated by the Board of Directors for all executives generally.





                                       15
<PAGE>   16
                (f)     Medical Expenses.  During the Employment Period, the
         Company shall pay, or reimburse the Executive for, all medical and
         dental expenses incurred by the Executive or his spouse or Dependents
         (as defined in Section 152 of the Internal Revenue Code ("CODE")). 
         The Executive acknowledges that the Company may enter into insurance
         agreements with respect to the payments and reimbursements described
         in this subsection.  The Executive will use reasonable efforts to
         assist the Company in recovering payments and reimbursements from such
         insurers.

                 (g)     Payment and Reimbursement of Expenses.  During the
         Employment Period, the Company shall pay or reimburse the Executive
         for all reasonable travel and other expenses incurred by the Executive
         in performing his obligations under this Agreement in accordance with
         the policies and procedures of the Company for its senior executive
         officers, provided that the Executive properly accounts therefor in
         accordance with the regular policies of the Company.  In addition, the
         Company shall pay or reimburse the Executive for reasonable costs of
         accountants, lawyers, compensation specialists and other professionals
         retained by the Executive in connection with the negotiation and
         execution of this Agreement.

                (h)     Fringe Benefits and Perquisites.  During the Employment
         Period, the Executive shall be entitled to participate in or receive
         benefits under any plan or arrangement made available by the Company
         to its senior executive officers, subject to and on a basis consistent
         with the terms, conditions and overall administration of such plans
         and arrangements.  Nothing paid to the Executive under any plan or
         arrangement made available to the Executive shall be deemed to be in
         lieu of compensation hereunder.
                
                 (i)     Vacations.  During the Employment Period and in
         accordance with the regular policies of the Company, the Executive
         shall be entitled to the number of paid vacation days in each calendar
         year determined by the Company from time to time for its senior
         executive officers, but not less than four (4) weeks in any calendar
         year (prorated in any calendar year in which the Executive is employed
         hereunder for less than the entire year in accordance with the number
         of days in such calendar year during which the Executive is so
         employed).

                (j)     Tax.  The Company may withhold from any compensation,
         benefits, or amounts payable under this Agreement all federal, state,
         city, or other taxes as may be required pursuant to any law or
         governmental regulation or ruling.  It is acknowledged by the parties
         that the Executive is and, at his option, may remain a resident of
         Canada during the term of this Agreement.  In the event that the
         Executive should be liable for any federal, provincial, state or local
         income or payroll taxes, on any income or benefits earned by the
         Executive in respect of his employment by the Company, in an amount
         greater than that amount of taxes that the Executive would be liable
         for (after taking into account any and all credits or deductions
         permitted under the laws of the United States and Canada and any tax
         treaties in effect between those countries) on the same income and
         benefits solely under the federal, provincial or local laws in effect
         in the Commonwealth of Canada (collectively, the "EXCESS TAXES"), then
         the Company shall "gross up" the Executive's compensation under this
         Agreement in an amount sufficient to pay such Excess Taxes.





                                       16