Cardero Resource Corp.: Exhibit 4.10 - Filed by newsfilecorp.com





This is Schedule “C” to the Agreement between
COALHUNTER
MINING CORPORATION
and
PEACE RIVER PARTNERSHIP
made as of the
15th day of June, 2010

COAL LEASE


THIS LEASE is made as of the 15th day of June,
2010.

BETWEEN:


PEACE RIVER PARTNERSHIP, a
partnership existing under the laws of Alberta between P. Burns Peace River
Resources Corporation and P. Burns Partners Limited, having an office at Suite
620, 5920 Macleod Trail SW, Calgary, Alberta T2H 0K2

(the “Peace River
Partnership”)


OF THE FIRST PART


AND:


COALHUNTER MINING CORPORATION, a
body corporate having an office at Suite 507 — 475 Howe Street, Vancouver,
British Columbia, V6C 2B3

(“Coalhunter”)


OF THE SECOND PART


WHEREAS:


A. the Peace River Partnership is the registered owner of the
Lands (as hereinafter defined), subject to such exceptions and reservations as
are contained or implied in the grants thereof from the Crown; and

B. Coalhunter wishes to acquire the sole and exclusive license
and authority to win and work all mines, seams and beds of Coal (as hereinafter
defined) in, on or under the Lands upon the terms and conditions and subject to
the covenants, restrictions, stipulations and provisions contained herein.

NOW THEREFORE in consideration of the premises and the mutual
covenants hereinafter contained, the parties covenant and agree as follows:




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ARTICLE 1
INTERPRETATION


1.1 Definitions


In this Lease, unless the context otherwise requires, the
following words and phrases shall have the following meanings:

	 	(a) 	
      “Affiliate” means, as to any party, any individual, body
      corporate, limited liability company, partnership, joint venture, firm or
      other form of enterprise which directly or indirectly Controls, is
      Controlled by, or is under common Control with, that party;

	 	 	 
	 	(b) 	
      “Annual Production” means during any year ended June
      15th , the amount of Coal expressed in metric tonnes recovered
      from the Lands and shipped to a destination off the Lands or delivered to
      a thermal plant or other facility constructed on the Lands for use in such
      thermal plan or other facility;

	 	 	 
	 	(c) 	
      “Business Day” means a day other than a Saturday, Sunday
      or a day on which banks in Vancouver, British Columbia are generally
      authorized or obligated by Law to close;

	 	 	 
	 	(d) 	
      “Carbon Creek Joint Venture” means a joint venture formed
      between the Carbon Creek Partnership and Coalhunter;

	 	 	 
	 	(e) 	
      “Carbon Creek Partnership” means a partnership between P.
      Burns Carbon Creek Coal Corporation and P. Burns Partners
  Limited;

	 	 	 
	 	(f) 	
      “Coal” includes lignite, sub-bituminous coal, bituminous
      coal and anthracite;

	 	 	 
	 	(g) 	
      “Coal Lease Option Agreement” means the coal lease option
      agreement between the Peace River Partnership and Coalhunter dated as of
      June 15, 2010;

	 	 	 
	 	(h) 	
      “Coal Substances” means any by-products produced from
      Coal and any products into which Coal may be converted;

	 	 	 
	 	(i) 	
      “Commercial Production” means the operation of all or
      part of the Lands as a producing Coal mine, but does not include bulk
      sampling for the purpose of testing. Commercial Production shall be deemed
      to have commenced on the first day of the month following the last day of
      the first period of fifteen (15) consecutive days during which Coal has
      been mined from the Lands at a rate exceeding one thousand three hundred
      seventy (1,370) metric tonnes per day and has either been shipped for the
      purpose of earning revenues to a destination off the Lands or has been
      delivered to a thermal plant or other facility constructed on the Lands
      for the use of such thermal plant or other facility, or both;

	 	 	 
	 	(j) 	
      “Control” means the right to the exercise, directly or
      indirectly, of at least fifty percent (50%) of the voting rights
      attributable to the shares or other ownership interests in any body corporate, limited liability company,
partnership, firm or other enterprise;







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	 	(k) 	
      “Disposition” includes any sale, assignment, transfer,
      sublease, parting with possession, agreement to hold any interest in
      trust, or other disposition of any interest in the Lands or any part
      thereof;

	 	 	 
	 	(l) 	
      “Encumbrances” means all interests, mortgages, charges,
      royalties, security interests, liens, encumbrances, actions, claims,
      demands and equities of any nature whatsoever or however arising and any
      rights or privileges capable of becoming any of the foregoing;

	 	 	 
	 	(m) 	
      “Environmental Harm” means any harm, damage, degradation
      or adverse effect on the environment;

	 	 	 
	 	(n) 	
      “Environmental Laws” means all applicable Laws relating
      to the protection, reclamation or remediation of the environment, or to
      the import, manufacture, storage, release, sale, use, handling, transport
      or existence of Hazardous Materials;

	 	 	 
	 	(o) 	
      “Freight on Rail” means the Proceeds of Sale for Coal
      recovered, shipped and sold, less the third party costs of transporting
      the Coal from the mine site upon the Lands to the shipping point,
      inclusive of rail and port charges;

	 	 	 
	 	(p) 	
      “Hazardous Materials” means any underground storage
      tanks, explosive, radioactive or corrosive materials, pollutants,
      contaminants, chemicals, waste, deleterious substances or industrial,
      toxic, dangerous or hazardous substances or wastes, including petroleum
      products and acid rock drainage;

	 	 	 
	 	(q) 	
      “Lands” means the fee simple lands and undersurface
      rights situated in the Peace River District of the Province of British
      Columbia described in Appendix “A” hereto and shown on the map attached as
      Appendix “B” hereto;

	 	 	 
	 	(r) 	
      “Laws” means all statutes, regulations, ordinances,
      by-laws, orders, directives and decisions of any federal, provincial,
      territorial, municipal or local government, ministry, department, court or
      administrative or regulatory agency applicable to the parties hereto or to
      the Lands or to any activities thereon, including all notices, rules,
      codes, guidelines, policies, directions, permits, approvals, licenses and
      similar authorizations issued, rendered or imposed by any level of
      government, and including the principles of common law and
  equity;

	 	 	 
	 	(s) 	
      “Losses” means claims, losses, demands, judgments,
      liabilities, expenses, damages, fines, charges and costs (including legal
      costs incurred on a solicitor and own client basis);

	 	 	 
	 	(t) 	
      “Minimum Annual Royalty” has the meaning given to that
      term in section 4.1;







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	 	(u) 	
      “parties” means the Peace River Partnership and the
      Coalhunter, as applicable, and “party” means any one of them;

	 	 	 
	 	(v) 	
      “Proceeds of Sale” of any Coal or Coal Substances means
      the gross amount payable by the buyer on the sale of Coal or Coal
      Substances;

	 	 	 
	 	(w) 	
      “Representatives” means the directors, officers,
      employees, auditors, legal counsel, professional advisors and other
      authorized representatives of a party and of any of its contractors and
      subcontractors;

	 	 	 
	 	(x) 	
      “Royalty” has the meaning given to that term in section
      3.1; and

	 	 	 
	 	(y) 	
      “Term” has the meaning set out in section
  2.2.



1.2 Interpretation

For purposes of this Lease:

	 	(a) 	
      headings are for convenience of reference only and are
      not intended to interpret, define or limit the scope of this Lease or any
      provision hereof;

	 	 	 
	 	(b) 	
      the singular of any term includes the plural and vice
      versa, and use of any term is generally applicable to either gender and
      where applicable, a body corporate, firm or other entity;

	 	 	 
	 	(c) 	
      the word “including” is not limiting whether or not
      non-limiting language (such as “without limitation” or “but not limited
      to” or words of similar import) is used with reference thereto;
  and

	 	 	 
	 	(d) 	
      unless otherwise indicated, all dollar references are to
      Canadian dollars.



ARTICLE 2
GRANT


2.1 Grant


IN CONSIDERATION of the sum of ten dollars ($10.00), the
receipt of which the Peace River Partnership hereby acknowledges, and of the
terms and conditions hereof and the covenants of Coalhunter hereinafter set out,
the Peace River Partnership does hereby grant unto Coalhunter the full and free
and sole and exclusive right to win and work all mines, seams and beds of Coal
in, on or under the Lands by any method of mining, including strip mining and
the removal of the overlying surface from the said Coal by means of power
shovels or other machinery and the depositing of any overburden or other
materials found in conjunction with the said Coal elsewhere on the Lands,
together with the right to dispose of the said Coal and any Coal Substances and
for the said purposes to enter upon the Lands and use and occupy so much thereof
as may be necessary for any or all of the said purposes or operations incidental
thereto or associated therewith, including the producing, treating, processing
and transporting of Coal and Coal Substances.




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2.2 Term


TO HAVE AND TO HOLD the same for the term (the “Term”) of seven
(7) years from the date hereof until June 15, 2017, and continuing thereafter
from year to year for so long as Coalhunter has complied with the terms and
conditions of this Lease, subject to earlier termination by agreement of the
parties or in the event of default by Coalhunter.

ARTICLE 3
ROYALTY ON PRODUCTION


3.1 Royalty

The Peace River Partnership hereby reserves and Coalhunter
shall pay to the Peace River Partnership as royalty (the “Royalty”) the
aggregate of

	 	(a) 	
      with respect to export or off-site sales the total
    of:

	 	 	 	 	 
	 		(i) 	
      on each shipment, either:

	 	 	 	 	 
	 			A. 	
      five percent (5%) Freight on Rail on Coal recovered,
      shipped and sold; or

	 	 	 	 	 
	 			B. 	
      two dollars ($2.00) per metric tonne of Coal recovered,
      shipped and sold;

	 	 	 	 	 
	 			
      whichever is greater; and

	 	 	 	 	 
	 		(ii) 	
      twenty percent (20%) of the Proceeds of Sale for any Coal
      Substances sold, including rejects, tailings and fly ash; and

	 	 	 	 	 
	 	(b) 	
      with respect to the consumption of Coal or Coal
      Substances on the Lands, including for purposes of a thermal Coal plant,
      Coal gasification plant or other facility, twenty percent (20%) of the
      Proceeds of Sale of the finished product, be that electricity, gas or some
      other product.



3.2 Royalty on Coal Substances


If any of the Coal recovered from the Lands is converted into
and sold as some other Coal Substance or in some other form, the royalties
herein provided shall. be computed on the Proceeds of Sale of such Coal
Substance or other form, after deducting therefrom the costs incurred in
converting the Coal into such Coal Substance or other form.

3.3 No Royalty on Coal Substances Used


No royalty shall be payable on any of the Coal Substances used
by Coalhunter in recovering or processing any of the Coal Substances recovered
from the Lands.




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3.4 Royalty Payments


Coalhunter shall pay or cause to be paid promptly as and when
they fall due, the royalties hereby reserved and any other payments herein
required to be made to the Peace River Partnership at its office at Suite 620,
5920 Macleod Trail S.W., Calgary, Alberta, T2H 0K2, or to such other person at
such place as the Peace River Partnership may direct in writing from time to
time, free and clear of and from all rates, taxes and assessments and from all
mariner of deductions whatsoever except as hereinafter mentioned or as may be
required by any Laws applicable thereto.

3.5 Time of Payments


The said royalties shall be paid by Coalhunter to the Peace
River Partnership not later than the twenty-fifth (25th) day of each
and every month during the Term hereof. Each monthly payment shall cover the
royalties payable with respect to all of the Coal and Coal Substances recovered,
shipped and sold from the Lands during the immediately preceding calendar
month.

ARTICLE 4
MINIMUM ANNUAL ROYALTY
PAYMENTS

4.1 Minimum Annual Royalty


Subsequent to June 15, 2015, if the Annual Production from the
Lands does not exceed five hundred thousand (500,000) metric tonnes of Coal in
any year, then Coalhunter shall pay to the Peace River Partnership, on the
anniversary date of this Lease, a minimum annual royalty (the “Minimum Annual
Royalty”) based on the greater of the following:

	 	(a) 	
      one-tenth (1/10th ) of what the Royalty would
      have been on the recovery, shipment and sale of one million (1,000,000)
      metric tonnes of thermal Coal based on the average NEWC price for seaborne
      thermal Coal for the preceding six (6) months; and

	 	 	 
	 	(b) 	
      the Royalty otherwise payable under this
  Lease.



ARTICLE 5
COALHUNTER OPERATIONS


5.1 Entry on Lands


Coalhunter may, at all times during the Term hereof, enter
upon, use and work any mine, seam or bed of Coal opened and worked by it in the
Lands.

5.2 Conduct of Operations


Coalhunter shall carry out all operations on the Lands in a
good and miner-like manner, in accordance with recognized engineering practices
and as is usual and customary in skilful and proper operations of similar
character when conducted by proprietors themselves on their own lands, with due
regard to the conservation of Coal and minerals therein and the timber
thereon.




C-7


5.3 Compliance with Laws


Coalhunter shall at all times perform, observe and comply with
the provisions of all applicable Laws.

5.4 Permits and Licences


Coalhunter shall be responsible for obtaining all necessary
permits and licenses for the conduct of any operations hereunder on the Lands.
The Peace River Partnership shall at the request and cost of Coalhunter extend
all reasonable co-operation and assistance to Coalhunter in obtaining all
necessary approvals, permits and licenses which may be required to enable
Coalhunter to lawfully carry on any operations hereunder on the Lands.

5.5 Redelivery of Possession


Coalhunter shall, at the termination of the Term herein
granted, except as herein otherwise provided, deliver possession of the Lands
and any works therein or thereon to the Peace River Partnership in the condition
required by applicable Laws.

5.6 No Obligation


Coalhunter shall, notwithstanding anything herein to the
contrary, have no obligation, expressed or implied, at any time to construct or
install any plant, equipment or facilities for the purpose of recovering,
processing or shipping any Coal or Coal Substances from the Lands or to mine or
work any of the Lands or to recover, process, ship or sell any Coal or Coal
Substances from the Lands or consume any Coal or Coal Substances on the
Lands.

5.7 Weighing and Measuring


Coalhunter shall, before shipping and selling any Coal or Coal
Substances, erect, install and thereafter maintain or .cause to be erected,
installed and maintained good, sufficient and properly constructed and installed
weighing or measuring machines, apparatus and devices for the purpose of
ascertaining the quantities of the Coal and Coal Substances recovered, shipped
and sold hereunder.

ARTICLE 6
PRODUCTION RECORDS


6.1 Production Records


Coalhunter shall furnish to the Peace River Partnership:

	 	(a) 	
      not later than the twenty-fifth (25th ) day of
      each and every month of the Term herein granted, a statement verified, if
      required, by statutory declaration of the superintendent or other officer
      of Coalhunter having charge of its operations on the Lands, showing the
      quantity of Coal and Coal Substances recovered, shipped and sold from the
      Lands and the Proceeds of Sale thereof during the immediately preceding
      month; and







C-8

	 	(b) 	
      within sixty (60) days next following the anniversary
      date of the Term, a statement, certified by the auditors of Coalhunter, in
      respect of the prior year showing the quantity of Coal and Coal Substances
      recovered, shipped and sold from the Lands, the Proceeds of Sale thereof
      and all transportation costs relating thereto.



ARTICLE 7
POOLING AND
COMMINGLING


7.1 Pooling and Commingling


Coalhunter is hereby given the right and power at any time and
from time to time to pool or commingle any of the said Coal and Coal Substances
from the Lands with Coal and Coal Substances from any Coal licenses, Coal leases
or other Coal interests acquired by the Carbon Creek Joint Venture and in any
such event the Peace River Partnership shall receive Royalty thereon at the
rates and on the terms specified in Article 3 on such portion of the total
quantity of the Coal or Coal Substances being pooled or commingled which is fair
and reasonable having regard to the quality and quantity of the Coal and Coal
Substances recovered and pooled or commingled from the Lands to the total
quantity and quality of the pooled or commingled Coal and Coal Substances being
shipped and sold. If, in any such event, a dispute should arise between the
Peace River Partnership and Coalhunter as to the Royalties payable by Coalhunter
to the Peace River Partnership, such dispute shall be settled by arbitration
under the Commercial Arbitration Act (British Columbia). The arbitration
shall be conducted by one arbitrator having such technical and other
qualifications as may be reasonably necessary to enable the arbitrator to
property adjudicate upon the dispute. Within seven (7) days of written notice
from one party to the other of a dispute, the parties shall attempt to agree
upon the person who is to act as the arbitrator. If the parties fail to agree on
the arbitrator within the said seven (7) days, such arbitrator shall be
appointed by a Justice of the B.C. Supreme Court. The arbitration shall take
place in Vancouver, B.C. and unless otherwise decided by the arbitrator, each
party shall be responsible for the cost of its own legal and other advisors, and
the cost associated with the arbitrator, including the fees of any expert
retained by the arbitrator and the costs of any facility in which the
arbitration takes place, shall be shared equally by the parties. The arbitrator
shall be limited to deciding the appropriate allocation of the portions of the
pooled or commingled quantities and qualities shipped and sold based solely on
the respective quantities and qualities of the Coal and Coal Substances pooled
or commingled from the Lands and from any other lands. The arbitration decision
shall be given in writing and shall be final and binding on the parties.

ARTICLE 8
TITLE


8.1 Title to Lands


The Peace River Partnership warrants that P. Burns Peace River
Resources Corporation is the legal owner and the Peace River Partnership is the
beneficial owner of a 100% interest in the Lands, that the title to the Lands is
free and clear of all Encumbrances and that it has not Encumbered or in any
other way alienated any of its right, title or interest in and to the Lands
and that it has to the best of its knowledge and belief, good right
and full power to grant the rights and privileges herein granted.




C-9


8.2 Title to Coal and Coal Substances



Except as herein otherwise expressly provided, the Peace River
Partnership does not convey, purport, promise or agree to convey to Coalhunter
any better title in and to any Coal or Coal Substances than the title therein
and thereto which the Peace River Partnership now has or is entitled to.

ARTICLE 9
QUIET ENJOYMENT


9.1 Quiet Enjoyment


Upon Coalhunter paying the Royalty hereby reserved pursuant to
section 3.1 and any Minimum Annual Royalty pursuant to section 4.1 and observing
and performing the other covenants, terms and conditions herein on its part
contained, Coalhunter shall and may, (subject however to the provisions and
conditions of this Lease), have the exclusive right to mine Coal from the Lands,
and to peaceably hold and enjoy the Lands and privileges for the Term hereby
granted without any interruption by the Peace River Partnership or any person
rightfully claiming under or in trust for it.

9.2 Use of Lands by Partnership


The Peace River Partnership shall not exercise its rights or
permit others to win, work and recover any mines and minerals other than Coal
lying within, upon or under the Lands, which rights and liberty are retained by
the Peace River Partnership, in such a way unreasonably to interfere with or
obstruct Coalhunter in the due enjoyment and exercise of the rights hereby
granted and shall compensate Coalhunter for all damages or injury occasioned to
Coalhunter by any operations of the Peace River Partnership or others in winning
and working any such other mines or minerals.

ARTICLE 10
ADDITIONAL
INFORMATION


10.1 Additional Information to Partnership


Coalhunter shall provide to the Peace River Partnership:

	 	(a) 	
      access to drill core and, once prepared and reviewed by
      Coalhunter, the results of all exploration and development work carried
      out by Coalhunter in respect of the Lands;

	 	 	 
	 	(b) 	
      at least once each calendar quarter, a written summary of
      the nature of all work conducted on the Lands since the last report and of
      the results and information obtained therefrom compiled by or in the
      possession of Coalhunter or any of its Representatives, including details
      of costs incurred and conclusions made and all technical information, including current maps, exploration
results and calculations of tonnages of resources and reserves; and







C-10



	 	(c) 	
      within ninety (90) days next following June 15th
      of each and every year of the said Term, a comprehensive written
      annual report of all work conducted since the last annual report and of
      the results and information obtained therefrom compiled by or in the
      possession of Coalhunter or any of its Representatives, including details
      of costs incurred and conclusions made and all technical information,
      including current maps, exploration results and calculations of tonnages
      of resources and reserves, quantities of production, revenues and
      expenses.



ARTICLE 11
STATUTORY RETURNS


11.1 Filing of Returns


Coalhunter shall from time to time file all such returns and
reports to and with such or applicable governmental authorities as and when
required under all applicable Laws.

11.2 Payment of Obligations


Coalhunter shall duly pay, on or before the times the same
become due and payable, all government royalties, rents, rates, property taxes,
mining taxes, levies, assessments and fees imposed upon or payable during the
Term herein granted with respect to the Lands, the Coal therein, the production
of Coal or any Coal Substances therefrom and Coalhunter’s exploration,
development and mining operations thereon. If any such charges are paid by the
Peace River Partnership, Coalhunter shall reimburse the Peace River Partnership
within thirty (30) days of receipt of notice of any such payment.

11.3 Government Notice


The Peace River Partnership shall forward promptly to
Coalhunter all notices and other communications relating to the Lands which it
receives from governmental authorities so that Coalhunter may carry out its
obligations under this Article 11.

ARTICLE 12
RECORDS AND ACCOUNTS


12.1 Maintain Records and Accounts


Coalhunter shall keep and maintain at its head office in
Vancouver, British Columbia:

	 	(a) 	
      full and complete books, records, accounts, reports,
      maps, plans and other documents relating to the exploration, development
      and mining activities of Coalhunter on the Lands, including those required
      to be kept and maintained under applicable Laws;
and







C-11

	 	(b) 	
      true and correct books, records and accounts showing the
      quantity of each of the Coal and Coal Substances recovered, shipped and
      sold on which any royalty or other payment is payable hereunder during the
      current and the immediately preceding year, and Proceeds of Sale of all
      Coal and Coal Substances recovered, shipped and sold from the Lands or
      consumed on the Lands during such period.



12.2 Production of Records


Coalhunter shall make available at all reasonable times at the
said office all or any of the said books, records, accounts, reports, maps,
plans and other documents required to be kept under section 12.1(a) and section
12.1(b) as may be required by any person appointed or authorized by the Peace
River Partnership to examine or inspect the same and the Peace River Partnership
may make or cause to be made and taken by it or on its behalf copies of or
extracts from any such books, records, accounts, reports, maps, plans and other
documents.

ARTICLE 13
INSPECTION


13.1 Access by Partnership


The Representatives of the Peace River Partnership shall have
the right of access to the Lands on forty-eight (48) hours’ prior notice at all
reasonable times during the Term herein granted, subject to section 30.1.

13.2 Inspection


Coalhunter shall permit any inspector or other person duly
authorized by the Peace River Partnership in that behalf, at all reasonable
times during the Term herein granted, to inspect any part of the Lands occupied
by Coalhunter and any plant constructed or installed thereon, and Coalhunter by
all means in its power shall aid and facilitate such inspector or other person
so doing, provided that in doing so no unnecessary interference is caused with
the carrying on of any Coalhunter operations.

ARTICLE 14
COOPERATION ON
OPERATIONS


14.1 Cooperation on Operations


The parties acknowledge that Coalhunter will be conducting
operations on the Lands for the purpose of exploring for and producing Coal or
Coal Substances and that the Peace River Partnership may conduct operations on
the Lands for the purpose of exploring for and recovering petroleum, natural
gas, sulphur, salt or other minerals. Each party shall advise the other party
from time to time of its projected operations on the Lands and shall consult
with the other party as to how such projected operations can best be carried out
so as to minimize the effect of such operations on the operations of the other
party.




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14.2 Protection of Wells


If the Peace River Partnership drills any well on the Lands,
Coalhunter shall leave unmined a barrier surrounding the casing or bore hole of
such well so drilled as may be required or prescribed by any governmental
authority in that behalf duly authorized.

ARTICLE 15
TIMBER


15.1 Use of Timber


Coalhunter may use any of the timber located on the Lands which
may be required for the purpose of any exploration, development and mining
operations conducted by Coalhunter on the Lands without compensation to the
Peace River Partnership, provided that Coalhunter shall duly pay all government
royalties, stumpage rates and taxes payable in respect of such timber.

15.2 Sale of Timber


If any timber is required to be cleared from the Lands in order
that Coalhunter may conduct exploration, development and mining operations on
the Lands, Coalhunter shall have right to clear and sell such timber on
reasonable commercial terms for the account of the Peace River Partnership.

15.3 Statements and Reports


Within sixty (60) days next following each and every year of
the Term herein granted, Coalhunter shall furnish to the Peace River
Partnership:

	 	(a) 	
      a statement certified by the auditors of Coalhunter in
      respect of such year, showing the proceeds of all dispositions of timber
      and timber rights and the expenses relating thereto and shall remit to the
      Peace River Partnership the net proceeds thereof excluding any income or
      other tax on profits realized therefrom; and

	 	 	 
	 	(b) 	
      copies of all stumpage and other timber reports filed by
      it with governmental authorities for such year.



ARTICLE 16
SURFACE RIGHTS


16.1 Entry by Coalhunter


Coalhunter shall be entitled to enter upon the surface a the
Lands as may be reasonably required to build and operate a Coal mining operation
and related beneficiation and other facilities for the duration of this
Lease.




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16.2 Exploitation by Partnership


In carrying out its operations in the Lands during the Term of
this Lease, Coalhunter shall not unduly interfere with the exploitation of the
Lands by the Peace River Partnership if the Peace River Partnership should wish
to exploit any of its rights therein, including its rights to produce petroleum
and natural gas, to extract Coal bed methane and to harvest timber.

16.3 Surrender


Notwithstanding anything to the contrary herein elsewhere
contained:

	 	(a) 	
      Coalhunter may, in its sole discretion, from time to time
      offer to surrender certain parts of the surface rights subject hereto and
      if such offer is accepted by the Peace River Partnership, Coalhunter may
      surrender such surface rights and thereupon this Lease shall terminate as
      to any surface rights so surrendered and Coalhunter shall be relieved of
      all further obligations with respect thereto; and

	 	 	 
	 	(b) 	
      the Peace River Partnership may from time to time request
      Coalhunter to surrender certain parts of the surface rights subject hereto
      and in any such event Coalhunter may, in its sole discretion, surrender
      the same and thereupon this Lease shall. terminate as to surface rights so
      surrendered and Coalhunter shall be relieved of all further obligations
      with respect thereto.



ARTICLE 17
INSURANCE


17.1 Coalhunter Coverage


Coalhunter at its own cost shall take out and keep in force in
respect of any loss which might occur during the Term:

	 	(a) 	
      comprehensive general liability (including bodily injury,
      death, personal injury and property damage) insurance on an occurrence or
      “claims made” form with respect to the business carried on, in or from the
      Leased Premises and the Coalhunter’s use and occupancy thereof of two
      million dollars ($10,000,000) or such other amount as the Peace River
      Partnership may from time to time require, with a self insured retention
      limit of not more than two hundred fifty thousand dollars ($250,000),
      which insurance shall include the Peace River Partnership as a named
      insured and shall protect the Peace River Partnership in respect of claims
      by Coalhunter as if the Peace River Partnership were separately
      insured;

	 	 	 
	 	(b) 	
      automobile insurance (including bodily injury, death,
      personal injury and property damage) insurance on an occurrence or “claims
      made” form of five million dollars ($5,000,000) or such amount as the
      Peace River Partnership may from time to time require, with a deductible
      of not more than twenty-five thousand dollars ($25,000), which insurance
      shall include the Peace River Partnership as a named insured and shall
      protect the Peace River Partnership in respect of claims by Coalhunter as
      if the Peace River Partnership were separately insured;
  and







C-14


17.2 Coalhunter Policies


All insurance required to be maintained by Coalhunter hereunder
shall be on terms and with insurers to which the Peace River Partnership has no
reasonable objection and shall provide that such insurers shall provide to the
Peace River Partnership thirty (30) days’ prior written notice of cancellation
or material alteration of such terms. Coalhunter shall furnish to the Peace
River Partnership evidence as to the insurance from time to time required to be
effected by Coalhunter and its renewal or continuation in force, either by means
of a certified copy of the policy or policies of insurance with all amendments
and endorsements or a certificate from Coalhunter’s insurer which, in the case
of comprehensive general liability insurance, shall provide such information as
may reasonably be requested by the Peace River Partnership. If Coalhunter shall
fail to take out, renew and keep in force such insurance the Peace River
Partnership may do so as the agent of Coalhunter and Coalhunter shall repay to
the Peace River Partnership any amounts paid by the Peace River Partnership as
premiums forthwith upon demand.

17.3 No Liability of Partnership


Coalhunter agrees that the Peace River Partnership shall in no
event be liable for any bodily injury or death of, or loss or damage to any
property belonging to, Coalhunter or any of its agents, employees, suppliers,
contractors, invitees, licensees, or any person for whom Coalhunter is in law
responsible in, on or about the Lands and in no event shall the Peace River
Partnership be liable for any loss or damage to the Lands or Coalhunter’s
equipment.

ARTICLE 18
RIGHTS TO INCOME
DEDUCTIONS


18.1 Rights to Income Deductions


With respect to any exemption, deduction or allowance (all of
which are hereinafter included in the term “allowance”) which may be claimed by
either or both parties under the Income Tax Act (Canada) or any Act
passed in substitution therefor or any regulations now in effect or hereafter
made under the authority of any such Act, the parties agree as follows:

	 	(a) 	
      any allowance allowed as the result of and calculated on
      any expenditure made or incurred by either party shall belong exclusively
      to the party making such expenditure and the other party shall not be
      entitled to claim any portion thereof;

	 	 	 
	 	(b) 	
      the Peace River Partnership shall not be entitled to all
      or any part of any allowance which may be claimed by Coalhunter and which
      cannot be claimed by the Peace River Partnership;

	 	 	 
	 	(c) 	
      Coalhunter shall not be entitled to all or any part of
      any allowance which may be claimed by the Peace River Partnership and
      which cannot be claimed by Coalhunter; and

	 	 	 
	 	(d) 	
      any allowance which may be claimed by both of the parties
      shall be shared equally between them in any taxation year; provided that
      if either party cannot use its entire share of any such allowance in any
      taxation year to reduce or defer any tax which might otherwise become payable on its income from any
operation conducted hereunder during that or any future taxation year, such
party shall make that portion of its share of such allowance for that taxation
year which it cannot so use, available to the other party and the other party
shall be entitled to claim and use all or any part of that portion of such
allowance so made available to it, in addition to its initial share of such
allowance.







C-15



ARTICLE 19
LIENS AND
ENCUMBRANCES


19.1 Liens and Encumbrances


Coalhunter shall not (by failure or neglect to pay or cause to
be paid any claim or account as and when the same becomes due and payable)
suffer any builder’s, mechanic’s, workmen’s, miners’ or materialmen’s lien
arising out of or connected with any work or operation carried on hereunder to
be filed or registered against all or any part of the Lands, unless there is a
bona fide dispute respecting such claim or account, and shall not suffer any
other encumbrance to be registered or filed against all or any part of the
Lands, except any caveat or other notification which may be filed by Coalhunter
to protect its interest hereunder or by a mortgagee, pledgee or permitted
assignee from Coalhunter to protect its or their interest under a mortgage,
pledge or permitted assignment of any interest of Coalhunter hereunder and will
not suffer any claim of or dues due to the Worker’s Compensation Board of
British Columbia to become in arrears so as to permit of any lien or charge of
such Board therefor becoming capable of enforcement against all or any part of
the Lands.

ARTICLE 20
FAILURE TO PERFORM


20.1 Failure to Perform


In the event of the occurrence with respect to Coalhunter of
any one or more of the following:

	 	(a) 	
      Coalhunter has failed to obtain on or before June 15,
      2013, all permits and approvals required under applicable Laws for the
      operation of a mine on the Lands, provided that if the Peace River
      Partnership, acting reasonably, considers that the failure to obtain any
      permit or approval which has not been obtained by Coalhunter is due to
      circumstances beyond the control of Coalhunter and that Coalhunter has
      made all reasonable efforts to obtain such permit or approval, such
      failure shall not be a termination event unless and until any such permit
      is refused; or

	 	 	 
	 	(b) 	
      Coalhunter has failed for whatever reason, whether or not
      beyond Coalhunter’s control, to commence Commercial Production on the
      Lands by June 15, 2017; or

	 	 	 
	 	(c) 	
      from and after June 15, 2017, Coalhunter fails to achieve
      Annual Production of at least five hundred thousand (500,000) metric
      tonnes for a period of three (3) consecutive
years;







C-16


then the Peace River Partnership, without prejudice to any
other remedy it may have, shall have the right to terminate this Lease.

ARTICLE 21
DEFAULT


21.1 Event of Default


In the event of the occurrence with respect to a party of any
one or more of the following:

	 	(a) 	
      upon any default by the party in the payment of any
      indebtedness or the performance of any obligation under this Agreement,
      and the failure of the party to cure any such default in the payment of
      any monies required hereby within thirty (30) days after receipt of
      written notice thereof from the other party, or the failure to cure any
      such default in the performance of any other obligation within sixty (60)
      days after receipt of written notice thereof from the other party;
    or

	 	 	 
	 	(b) 	
      if the interest of a party in this Agreement shall be the
      subject of a levy or attachment and such levy and attachment shall not
      have been discharged within sixty (60) days thereafter; or

	 	 	 
	 	(c) 	
      if a decree or order by a court of competent jurisdiction
      shall have been entered adjudging a party a bankrupt or insolvent, or
      approving as properly filed a petition seeking reorganization of or
      arrangement by such party under the Bankruptcy and Insolvency Act
      (Canada) or any other similar applicable law, and such decree or order
      shall have continued undischarged and unstayed for a period of sixty (60)
      days; or a decree or order of a court of competent jurisdiction for the
      appointment of a receiver or liquidator or trustee or assignee in
      bankruptcy or insolvency of a party or any of its property, or for the
      compulsory winding-up of its affairs, shall have been entered, and such
      decree or order shall have remained in force undischarged or unstayed for
      a period of sixty (60) days; or

	 	 	 
	 	(d) 	
      if a party shall institute proceedings to be adjudicated
      a voluntary bankrupt, or shall consent to the filing of a bankruptcy
      proceeding against it, or shall file a petition or answer or consent
      seeking reorganization or an arrangement under the Bankruptcy and
      Insolvency Act or any other similar applicable law, or shall consent to
      the appointment of a receiver or trustee or assignee in bankruptcy or
      insolvency of it or of its property, or shall make an assignment for the
      benefit of creditors, or shall admit in writing its inability to pay its
      debts generally as they become due, or corporate action shall be taken by
      a party in furtherance of any of the aforesaid
purposes;



then the other party, without prejudice to any other remedy it
may have, shall have the right to terminate this Lease.




C-17


21.2 Dispute


Notwithstanding section 21.1, if at any time there should arise
between the Peace River Partnership and Coalhunter a bona fide dispute as to the
amount of any money payments including Royalty or Minimum Annual Royalty due to
the Peace River Partnership from Coalhunter and if Coalhunter shall have paid to
the Peace River Partnership all sums except the portion thereof concerning which
there is such dispute and if Coalhunter shall promptly deposit in a British
Columbia Court of competent jurisdiction a sum of money equal to the amount
involved in such dispute, such deposit in Court to be made in such manner that
the money so deposited shall be subject to the disposition of the Court through
its judgment in an action brought by either party, then and in such event the
Peace River Partnership may not declare any forfeiture by reason of Coalhunter’s
default to make full payment of the amount claimed by the Peace River
Partnership.

ARTICLE 22
FORCE MAJEURE


22.1 Force Majeure


No party shall be liable to any other party hereto and no party
shall be deemed in default hereunder for any failure to perform or delay in
performing any of its covenants and agreements caused by or arising out of any
act beyond the reasonable control of such party, excluding lack of funds but
including, without limitation, lack of rights or permission by First Nations or
indigenous peoples’ groups to enter upon the Lands to conduct exploration,
development and mining operations thereon, war or war conditions, actual or
potential, earthquake, fire, storm, flood, explosion, strike, labour trouble,
accident, riot, unavoidable casualty, act of restraint, present or future, of
any lawful authority, act of God, protests or demonstrations by environmental
lobbyists, First Nations or indigenous peoples’ groups, acts of the public
enemy, delays in transportation, breakdown of machinery, inability to obtain
necessary materials in the open market or unavailability of equipment. No right
of a party shall be affected for failure or delay of a party to perform any of
its covenants and agreements if the failure or delay is caused by one of the
events referred to above. All times provided for in this Lease shall be extended
for the period commensurate with the period of the delay and, so far as
possible, the party affected shall take all reasonable steps to remedy the cause
of the delay attributable to the events referred to above; provided, however,
that nothing contained in this section shall require any party to settle any
labour dispute, protest or demonstration, or to question or test the validity or
constitutionality of any Law or any claim of right by First Nations or
indigenous peoples’ groups. The party affected shall give notice to the other
party of the commencement and termination of each period of force majeure.

ARTICLE 23
SURRENDER


23.1 Surrender


Notwithstanding anything herein contained, Coalhunter may, at
any time, upon giving the Peace River Partnership sixty (60) days’ prior written
notice thereof determine or surrender all of its right, title and interest in all of the Lands or in any legal
section of the Lands whereupon this Lease shall terminate as to the part so
surrendered.




C-18



ARTICLE 24
STATUS OF LANDS ON
TERMINATION


24.1 Delivery of Information


At the end of the Term or sooner termination of this Lease,
Coalhunter shall:

	 	(a) 	
      forthwith upon the written request of the Peach River
      Partnership, discharge any lien or encumbrance created against such part
      of the Lands by reason of any operation conducted by Coalhunter hereunder
      and any caveat or other notification, lien or encumbrance which it or any
      person including any corporation claiming by, through or under Coalhunter
      may have registered against such part of the Lands;

	 	 	 
	 	(b) 	
      deliver at no cost to the Peace River Partnership within
      ninety (90) days of termination of this Lease copies of all reports, maps,
      data, analyses, studies, test results, exploration results and other
      factual information compiled by or in the possession of Coalhunter or its
      Representatives with respect to the Lands or any Coal, Coal Substances or
      minerals therein or thereon not theretofore furnished to the Peace River
      Partnership;

	 	 	 
	 	(c) 	
      subject to section 24.2, perform in accordance with all
      Environmental Laws all reclamation, remediation and pollution control
      which is required as a result of any activities authorized by or performed
      by Coalhunter pursuant to this Lease or the Coal Lease Option Agreement;
      and

	 	 	 
	 	(d) 	
      remain liable to the Peace River Partnership for any
      Royalty, Minimum Royalty, taxes, rates and assessments then due and unpaid
      with respect to the Lands and Coalhunter’s exploration, development and
      mining operations on the Lands to the same extent as if such termination
      had not occurred.



24.2 Reclamation and Remediation


For greater certainty, the Peace River Partnership shall be
responsible for any reclamation, remediation and pollution control of conditions
existing prior to the date of this Agreement. Coalhunter shall be responsible
for all reclamation, remediation and pollution control of conditions created
thereafter as a result of Coalhunter’s activities hereunder and under the Coal
Lease Option Agreement.




C-19


ARTICLE 25
REMOVAL OF ASSETS FROM
LANDS


25.1 Removal of Assets


Upon the termination of this Lease, Coalhunter shall have the
right to remove from the Lands within the twelve (12) month period next
following such termination all machinery, buildings, structures, equipment,
supplies and any other property and assets placed by Coalhunter or any of its
Representatives thereon and shall, if requested by the Peace River Partnership
within such period, remove such property and assets, in each case at
Coalhunter’s expense. Coalhunter’s interest in any such property and assets not
removed by Coalhunter within the said twelve (12) month period shall be deemed
to have been conveyed by Coalhunter to the Peace River Partnership except for
any Hazardous Materials and containers or other property associated
therewith.

ARTICLE 26
SURFACE LEASE


26.1 Surface Lease


Upon the termination of this Lease, Coalhunter shall have the
option to acquire a surface lease for the continued use of the surface of the
Lands for Coal processing activities for a term not exceeding twenty (20) years,
on payment of an annual surface lease rental payable on the anniversary date of
the termination of this Lease of a sum that is the equivalent to the payment on
June 15, 2010 of one hundred thousand dollars ($100,000) adjusted for inflation
using the Canadian Consumer Price Index or any successor index generally used in
Canada from and after June 15, 2010. Unless otherwise agreed by the parties,
such surface lease shall be on the terms of this Lease, provided that Coalhunter
shall not be entitled to carry on exploration, development or mining operations
on the Lands during the term of such surface lease.

ARTICLE 27
NON-DISCLOSURE


27.1 Non-Disclosure


Confidential Information concerning this Lease or any matters
arising from or in connection with this Lease shall be treated as confidential
by the parties hereto and shall not be disclosed by any party hereto to any
other person (other than an Affiliate of the disclosing party which wholly owns
or is wholly owned by, the disclosing party, or is wholly owned by any
combination thereof who has agreed in writing not to disclose such information
to any other person except as permitted hereby) without the prior written
consent of the other party hereto, such consent not to be unreasonably withheld,
except to the extent that such disclosure may be necessary for observance of all
applicable Laws or stock exchange requirements or for accomplishment of the
purposes of this Lease. A copy of all information disclosed by a party (whether
or not requiring permission pursuant to this section) shall be given forthwith
to the other party hereto.




C-20


27.2 Confidential Information


As used herein, “Confidential Information” means all
information regarding the assets, liabilities, contracts, documents, operations,
employee matters, customer matters, supplier matters and business matters of
Coalhunter, P. Burns Peace River Resources Corporation, P. Burns Partners
Limited, the Peace River Partnership and P. Burns Resources Limited and their
respective Affiliates, as the case may be, including all information regarding
the Lands and including in each case any such information provided to the other
party or to the other’s Representatives together with all analyses,
compilations, studies, notes or other documents, whether prepared by Coalhunter,
P. Burns Peace River Resources Corporation, P. Burns Partners Limited, the Peace
River Partnership, P. Burns Resources Limited, their respective Representatives
or by others, which contain or otherwise reflect such information. The term
Confidential Information shall not include such information which:

	 	(a) 	
      is or becomes generally available to the public other
      than as a result of a disclosure by the party bound by a confidentiality
      obligation hereunder with respect to such information or any of its
      Representatives; or

	 	 	 
	 	(b) 	
      is or becomes available to such party on a
      non-confidential basis from a source (other than the other party) which,
      to such party’s knowledge, is not prohibited from disclosing such
      information or other information to such party or its
    Representatives.



ARTICLE 28
PUBLICITY


28.1 Publicity


Each party shall provide the other with a copy of any news
release it proposes to publish containing exploration results or other
information concerning the Lands or this Lease prior to publication of the same
for the other party’s consent which will not be unreasonably withheld or delayed
in view of any timely disclosure obligations which may be applicable. Each party
shall use all reasonable efforts to respond to any request by the other party
for such consent within two (2) Business Days. For the avoidance of doubt,
nothing in this section 28.1 shall prevent either party from complying with
obligations under applicable securities Laws or the rules or policies of any
stock exchange on which such party’s securities are listed.

28.2 P. Burns Privacy


Coalhunter acknowledges that P. Burns Peace River Resources
Corporation, P. Burns Partners Limited, the Peace River Partnership and P. Burns
Resources Limited are all private entities, and that none of them are or will be
subject to the same level of scrutiny as publicly traded corporations and that
all of them wish to maintain privacy with respect to their business affairs.
Coalhunter shall make all reasonable efforts to prevent any unnecessary
disclosure of any of their names or financial or ownership interests.




C-21


ARTICLE 29
RECLAMATION FUND


29.1 Reclamation Fund


Upon the commencement of Commercial Production from the Lands,
Coalhunter shall establish a fund (the “Reclamation Fund”) to be maintained as a
separate, escrow account, for the purpose of paying all costs of environmental,
reclamation, remediation, pollution control, decommissioning, shut-down and
other similar costs and liabilities (collectively the “Reclamation Costs”) that
may arise from time to time as a result of the operation of a mine on the Lands.
At the time the Reclamation Fund is established, Coalhunter, in good faith,
shall estimate the amount of money required to pay the Reclamation Costs
throughout the life of the mine and, based upon the estimated life of the mine,
the amount of money (the “Reclamation Assessment”) that will be required to be
contributed by Coalhunter on an annual basis, or from time to time in the case
of special or unexpected Reclamation Costs, in order to establish and maintain
the Reclamation Fund. Coalhunter shall, within thirty (30) days next following
the date of the Reclamation Assessment, pay the Reclamation Assessment into the
escrow account. Coalhunter may, with the prior written consent of the Peace
River Partnership, deposit security in lieu of such payment being made in cash.
Coalhunter shall not be entitled to a refund of any Reclamation Assessments (or
security in lieu thereof) upon the termination of this Lease for any reason.

ARTICLE 30
INDEMNITIES


30.1 Indemnification by Partnership


The Peace River Partnership shall indemnify and save harmless
Coalhunter and its Representatives (collectively the “Coalhunter Indemnified
Parties”) from and against any and all Losses of every kind whatsoever, whether
direct or indirect, which at any time or from time to time are directly or
indirectly incurred or suffered by any of the Coalhunter Indemnified Parties in
connection with, as a result of or arising out of:

	 	(a) 	
      any misrepresentation or untrue warranty of the Peace
      River Partnership;

	 	 	 
	 	(b) 	
      any breach of this Lease by the Peace River
      Partnership;

	 	 	 
	 	(c) 	
      the performance of any obligations imposed by any
      Environmental Laws, the taking of steps by or on behalf of any of the
      Coalhunter Indemnified Parties to protect against or in connection with
      Environmental Harm, or any liability of any of the Coalhunter Indemnified
      Parties for any Environmental Harm, insofar as such performance, taking of
      steps or liability may directly or indirectly relate to conditions
      existing on the Lands prior to the date of this Lease, provided that the
      indemnity contained in this section 30.1(c) shall not apply to the extent,
      if any, that such Losses are the consequence of the activities, acts or
      omissions after the date of this Lease of Coalhunter or any of its
      Representatives;







C-22

	 	(d) 	
      with the exception of any Losses caused by the gross
      negligence or wilful misconduct of Coalhunter, any injury (including
      injury causing death) of any Representative of the Peace River Partnership
      while on the Lands; or

	 	 	 
	 	(e) 	
      any damages to the property of Coalhunter on the Lands
      caused by any Representative of the Peace River
  Partnership.



For greater certainty, no termination of this Lease shall
disentitle any of the Coalhunter Indemnified Parties from obtaining
indemnification from the Peace River Partnership pursuant to this section.

30.2 Indemnification by Coalhunter


Coalhunter shall indemnify and save harmless the Peace River
Partnership and its Representatives (collectively the “Peace River Partnership
Indemnified Parties”) from and against any and all Losses of every kind
whatsoever, whether direct or indirect, which at any time or from time to time
are directly or indirectly incurred or suffered by any of the Peace River
Partnership Indemnified Parties in connection with, as a result of or arising
out of

	 	(a) 	
      any misrepresentation or untrue warranty of
      Coalhunter;

	 	 	 
	 	(b) 	
      any breach of this Lease by Coalhunter;

	 	 	 
	 	(c) 	
      any works or operations carried on by or for Coalhunter
      in or on the Lands;

	 	 	 
	 	(d) 	
      the performance of any obligations imposed by any
      Environmental Laws, the taking of steps by or on behalf of any of the
      Peace River Partnership Indemnified Parties to protect against or in
      connection with Environmental Harm, or any liability of any of the Peace
      River Partnership Indemnified Parties for any Environmental Harm, insofar
      as such performance, taking of steps or liability may directly or
      indirectly arise as a consequence of the activities, acts or omissions
      during the Term of this Lease of Coalhunter or any of its
      Representatives;

	 	 	 
	 	(e) 	
      with the exception of any Losses caused by the gross
      negligence or wilful misconduct of the Peace River Partnership, any injury
      (including injury causing death) of any Representatives of Coalhunter
      while on the Lands; or

	 	 	 
	 	(f) 	
      any damages to the property of the Peace River
      Partnership on the Lands caused by any Representative of
  Coalhunter.



For greater certainty, no termination of this Lease shall
disentitle any of the Peace River Partnership Indemnified Parties from obtaining
indemnification from Coalhunter pursuant to this section.




C-23


ARTICLE 31
ENCUMBRANCE AND
ASSIGNMENT


31.1 Encumbrance and Assignment


Coalhunter shall not grant any Encumbrance or enter into any
Disposition without the prior written consent of the Peace River Partnership,
which consent may be arbitrarily withheld.

ARTICLE 32
NOTICES 


32.1 Notices


Any notice, commitment, election, consent or any communication
required or permitted to be given hereunder by either party hereto to the other
party, in any capacity (a “Notice”) shall be in writing and shall be deemed to
have been well and sufficiently given if mailed by prepaid registered mail
return receipt requested, telefaxed or delivered, to the address of such other
party hereinafter set forth:

If to the Peace River
Partnership:


Peace River Partnership
Suite
620
5920 Macleod Trail SW
Calgary, Alberta
T2H 0K2
Attention: Larry
Horan
Fax Number: 403-259-2633


If to
Coalhunter:


Coalhunter Mining Corporation
Suite
507
475 Howe Street
Vancouver, B.C.
V6C 2B3
Attention: Michael
Hunter
Fax Number: 604-687-7848


or to such substitute address as such party may from time to
time direct in writing, and any such Notice shall be deemed to have been
received, if mailed, on the date noted on the return receipt, if telefaxed, on
the first Business Day after the date of transmission, and if delivered, upon
the day of delivery or if such day is not a Business Day, then on the first
Business Day thereafter.




C-24


ARTICLE 33
GENERAL 


33.1 Remedies Cumulative


No remedy herein conferred upon or reserved to a party is
intended to be exclusive of any other remedy, but each and every such remedy
shall be cumulative and shall be in addition to any other remedy given hereunder
or now or hereafter existing under applicable laws.

33.2 Further Assurances


Each party hereto shall promptly do and provide all acts and
things and shall promptly execute and deliver such documents and shall give such
further assurances as shall be necessary or appropriate in connection with the
performance of this Lease.

33.3 Waiver


No waiver on behalf of any party of any breach of any of the
covenants, conditions and provisos herein contained shall be effective or be
binding upon such party unless the same be expressed in writing and any waiver
so expressed shall not limit or affect such party’s rights with respect to any
other or future breach.

33.4 Amendments


No alteration, amendment, modification or interpretation of any
provision of this Lease shall be binding unless in writing, and executed and
delivered by each of the parties hereto.

33.5 Business Days


In the event that any date on or by which any payment is
required to be made or any action is required to be taken hereunder by any of
the parties hereto is not a Business Day, such payment shall be required to be
made or such action shall be required to be taken on the next succeeding day
which is a Business Day.

33.6 Appendices


The Appendices attached to this Lease are deemed to form part
of this Lease.

33.7 Map


The map attached as Schedule “B” hereto provides an
approximation of the areas covered by the Peace River Partnership Lands. The
Peace River Partnership makes no representation or warranty as to the accuracy
or completeness of the said map.

33.8 Counterparts


This Lease may be executed in any number of counterparts, each
of which shall be deemed to be an original, and all of which shall constitute
one and the same instrument.




C-25


33.9 Governing Law


This Lease shall be governed by, and interpreted and construed
in accordance with, the laws of British Columbia and the federal laws of Canada
applicable therein. Each party irrevocably submits to the non-exclusive
jurisdiction of the courts of British Columbia with respect to any matter
arising under this Lease or relating hereto.

33.10 Time of Essence

Time shall be of the essence of
this Lease.

 33.11 Entire Agreement



This Lease contains the entire understanding between the
parties hereto dealing with the subject matter hereof and supersedes all
negotiations, correspondence, letters of intent, letter agreements, and prior
agreements or understandings relating thereto, including the Carbon Creek Coal
Lease Letter Agreement.

33.12 Relationship of Parties


Nothing contained herein, nor the holding of any interest
acquired hereunder, shall be deemed to constitute Coalhunter or the Peace River
Partnership, the partner, agent or legal representative of the other or to
create any fiduciary relationship between them for any purpose whatsoever.

33.13 Severability/Illegality


If one or more provisions of this Lease shall be invalid,
illegal or unenforceable in any respect under any applicable Law, the validity,
legality and enforceability of the remaining terms or provisions hereof shall
not be affected or impaired by reason thereof.

33.14 Binding of Lands


All terms, covenants, provisions and conditions of this Lease
shall run with and be binding upon the Lands during the Term hereof.

33.15 Enurement


This Lease shall enure to and be binding upon the parties
hereto and their respective successors and permitted assigns.




C-26


IN WITNESS WHEREOF the parties hereto have caused this
Agreement to be executed by their property officers duly authorized in that
behalf as of the day and year first above written.

	SIGNED, SEALED AND DELIVERED 	  ) 	  
	on behalf of the PEACE RIVER 	  ) 	  
	PARTNERSHIP by: 	  ) 	  
	  	  ) 	  
	  	  ) 	  
	/s/ Burns
    	  ) 	C/S 
	Authorized Signatory 	  ) 	(Burns Partners Limited) 
	  	  ) 	  
	Date Executed:10 February 2012 	  ) 	  
	  	  ) 	  



	THE CORPORATE SEAL OF 	  ) 	 
	COALHUNTER MINING 	  ) 	 
	CORPORATION was hereunto affixed in 	  ) 	 
	the presence of: 	  ) 	 
	  	  ) 	 
	  	  ) 	 
	/s/ Michael
      Hunter 	  )	C/S 
	Authorized Signatory 	  )	(Cardero Coal Ltd.) 
	  	  ) 	 
	Date Executed:07 November 2012 	  ) 	 
	  	  ) 	 






APPENDIX “A”


LANDS AND UNDERSURFACE RIGHTS


The following table lists fee simple lands and undersurface
rights situated in the Peace River District, Province of British Columbia,
registered in the name of P. Burns Peace River Resources Corporation and
beneficially owned by the Peace River Partnership:

A. Fee Simple Lands 


		Legal Description: 	Crown
      Grant

    Document Number: 
	1. 	
      Parcel Identifier: 016-907-361, District Lot 319, Peace
      River District, except Plans PGP 35925 and PGP 40024 
	8212/953 
	2. 	
      Parcel Identifier: 016-907-621, District Lot 320, Peace
      River District, except Plans PGP 35925 and PGP 40014 
	8213/953 
	3. 	
      Parcel Identifier: 016-908-562, District Lot 321, Peace
      River District, except Plans PGP 35924 and PGP 35925 
	8214/953 
	4. 	
      Parcel Identifier: 016-909-119, District Lot 322, Peace
      River District, except Plans PGP 35925 and PGP 40024 
	8215/953 
	5. 	
      Parcel Identifier: 007-846-762, District Lot 323, Peace
      River District, except Plans PGP 40023 
	9185/962 
	6. 	
      Parcel Identifier: 016-909-194, District Lot 324, Peace
      River District, except Plans PGP 35923, PGP 35925 and PGP 
40023

	9187/962 
	7. 	
      Parcel Identifier: 016-909-216, District Lot 325, Peace
      River District, except Plans PGP 35923, PGP 35925, PGP 40022 and PGP 40023
      
	8216/953 
	8. 	
      Parcel Identifier: 007-846-827, District Lot 326, Peace
      River District 
	8217/953 
	9. 	
      Parcel Identifier: 006-566-847, District Lot 327, Peace
      River District 
	9186/962 
	10. 	
      Parcel Identifier: 007-846-835, District Lot 328 Peace
      River District 
	8218/953








C-2


B. Undersurface Rights

	1. 	
      Charge No. PG6990

	 	 
	2. 	
      Charge No. PG6993

	 	 
	3. 	
      Charge No. PG6995

	 	 
	4. 	
      Charge No. PG6997

	 	 
	5. 	
      Charge No. PG7000

	 	 
	6. 	
      Charge No. PG7002

	 	 
	7. 	
      Charge No. PG7005

	 	 
	8. 	
      Charge No. PG7007

	 	 
	9. 	
      Charge No. PG7010

	 	 
	10. 	
      Charge No. PK28808

	 	 
	11. 	
      Charge No. PK28809

	 	 
	12. 	
      Charge No. PK28810

	 	 
	13. 	
      Charge No. PK28804

	 	 
	14. 	
      Charge No. PK28806

	 	 
	15. 	
      Charge No. PK28807

	 	 
	16. 	
      Charge No. PK28805







APPENDIX “B”

MAP