Document:

AGREEMENT OF PURCHASE AND SALE

      THIS AGREEMENT dated as of the 29th day of September, 2004

B E T W E E N:

      POWERMAX ENERGY INC., a corporation registered to carry on business in the
      Province of Saskatchewan and having an office in the City of Calgary, in
      the Province of Alberta (hereinafter referred to as "Vendor")

                                     - and -

      808099 ALBERTA LTD. a corporation registered to carry on business in the
      Province of British Columbia, having an office in the City of Vancouver,
      in the Province of British Columbia (hereinafter referred to as
      "Purchaser")

      WHEREAS Vendor has agreed to sell and assign to Purchaser and Purchaser
has agreed to purchase and acquire from Vendor certain interests of Vendor in
the Assets herein more particularly described;

      NOW THEREFORE in consideration of the premises hereto and the covenants
and agreements hereinafter set forth and contained, the parties hereto covenant
and agree as follows:

1.    DEFINITIONS

      In this Agreement, including the premises hereto, this clause and the
      Appendices hereto, the words and phrases set forth below shall have the
      meaning ascribed thereto below namely:

      a)    "Assets" means collectively the Petroleum and Natural Gas Rights,
            and the Miscellaneous Interests;

      b)    "Closing" means the transfer of the Assets by Vendor to Purchaser
            and the payment by Purchaser to Vendor of the purchase consideration
            therefore, less the Prepaid Deposit paid by Purchaser and the
            completion of all matters incidental thereto;

      c)    "Closing Time" means 2:00 PM local time at the Place of Closing, on
            the 29th day of September, 2004, or such earlier time or date as may
            be agreed to by Purchaser and Vendor;

      d)    "Conveyance" means an agreement in the form attached as Schedule
            "B";

      e)    "Dollars" or "$" shall mean lawful currency of Canada, and all
            payments and receipt shall be made and recorded in lawful currency
            of Canada;

      f)    "Effective Time" means 12:01 a.m. Mountain Standard Time on the 29th
            day of September, 2004;

      g)    "Lands" means the lands set forth and described in Schedule "A"
            hereto and includes the Petroleum Substances within, upon or under
            such lands, together with the right to explore for and recover same
            insofar as such rights are granted by the Permits;

<PAGE>
                                      -2-

      h)    "Miscellaneous Interests" means the interests of the Vendor (other
            than the Petroleum and Natural Gas Rights and the Tangible
            Interests) in all property, assets and rights relating to the
            Petroleum and Natural Gas Rights;

      i)    "Permits" means collectively the leases, reservations, permits, and
            licences and documents of title set forth and described in Schedule
            "A" hereto or other similar documents of title by virtue of which
            the holder thereof is entitled to drill for, win, take or remove the
            Petroleum Substances underlying all or any part of the Lands;

      j)    "Petroleum and Natural Gas Rights" means the entire right, title,
            estate and interest of Vendor, including the undivided percentage
            working interests set forth in Schedule "A" hereto, in the Permits
            and the Lands;

      k)    "Petroleum Substances" means petroleum, natural gas and related
            hydrocarbons and all other substances, whether liquid, solid or
            gaseous and whether hydrocarbons or not, the rights to which are
            granted by the Permits;

      l)    "Place of Closing" means the Calgary offices of Powermax Energy
            Inc.;

2.    INTERPRETATION

      a)    Appended hereto are the following Appendices:

            Schedule "A" - Description of Lands and Permits

            Schedule "B" - Conveyance

            All Appendices hereto are incorporated into and are part of this
            Agreement by this reference as fully as though contained in the body
            of this Agreement;

      b)    Wherever any provision of any Schedules to this Agreement conflicts
            with any provision in the body of this Agreement, the provisions of
            the body of this Agreement shall prevail. References herein to a
            Schedule shall mean a reference to a Schedule to this Agreement.
            References in any schedule to "the Agreement" shall mean a reference
            to this Agreement. References in any Schedule to another Schedule
            shall mean a reference to a schedule to this Agreement;

      c)    References herein to a clause shall mean a reference to a clause
            within the body of this Agreement;

      d)    The headings of clauses and subclauses herein and in the Appendices
            are inserted for convenience of reference only and shall not affect
            or be considered to affect the construction of the provisions
            hereof;

      e)    In this Agreement words importing persons include companies and vice
            versa and words importing the masculine gender include the feminine
            and neuter genders and vice versa.

3.    CONVEYANCE

      Vendor, for the price and sum of One Million ($1,000,000.00) Dollars and
      other good and valuable consideration the receipt of which is hereby
      acknowledged, hereby sells, assigns, transfers, conveys and sets over to
      Purchaser the entire right, title, estate and interest of Vendor in and to
      the Assets, TO HAVE AND TO HOLD the same, together with all benefit and
      advantage to be derived therefrom, absolutely, subject only to the
      respective terms and conditions of the Permits and those encumbrances set
      forth on Schedule "A" hereto, and the obligations of Vendor thereunder.

<PAGE>
                                      -3-

      The purchase price shall be allocated as between such categories of the
      assets in the following amounts:

         Intangibles:
             Petroleum and Natural Gas Rights                 $  799,990.00
             Initial Nonrefundable Deposit (July 30)             100,000.00
             Second Nonrefundable Deposit (Aug 31)               100,000.00
                                                              -------------
             Subtotal for P&NG Rights                         $  999,990.00

         Miscellaneous Interests:                                     10.00
                                                              -------------

             Total Purchase Price                             $1,000,000.00
                                                              =============

      The Vendor shall provide, at the Closing Time hereof, specific
      assignments, transfers and further assurances as Purchaser may reasonably
      require to acquire the Vendor's interest in any assets purchased herein.

4.    ADJUSTMENTS

      All benefits and obligations of every kind and nature accruing, payable or
      paid in respect of the Assets, including, without limitation, operating
      costs, capital costs, governmental incentives and proceeds from the sale
      of production, shall be adjusted between the Vendor and the Purchaser as
      of the Effective Time. Purchaser agrees to reimburse Vendor for all
      authorized expenditures associated with the Assets on a net working
      interest basis, provided such expenditures were incurred prior to the
      Effective Date. Notwithstanding the foregoing, the Vendor and the
      Purchaser acknowledge that:

      a)    all costs of whatever nature incurred in connection with work
            performed or goods or services provided in respect of the Assets
            prior to the Effective Time shall be borne by the Vendor, regardless
            of the time at which the same become payable;

      b)    all costs of whatever nature incurred in connection with work
            performed or goods or services provided in respect of the Assets
            after the Effective Time shall be borne by the Purchaser, regardless
            of the time at which the same become payable;

5.    PAYMENTS

      All payments pursuant hereto shall be made by bank draft or certified
      cheque payable to Vendor.

6.    EFFECTIVE TIME

      The transfer and assignment of the Assets from Vendor to Purchaser shall
      be effective as of the Effective Time.

7.    CLOSING

      Closing shall take place at the Place of Closing at the Closing Time.

8.    CONVEYANCE DOCUMENTS

      a)    At Closing Vendor shall deliver to Purchaser such transfers,
            assignments, conveyances (including the Conveyance), with respect to
            the Assets as may be required. Purchaser shall cooperate with Vendor
            to secure execution of such documents by the parties thereto other
            than Vendor and Purchaser;

<PAGE>
                                      -4-

      b)    All documents executed and delivered pursuant to the provisions of
            this clause or otherwise pursuant to this Agreement are subordinate
            to the provisions of this Agreement and the provisions of this
            Agreement shall govern and prevail in the event of a conflict
            between the provisions of any such document and the provisions of
            this Agreement.

9.    COVENANTS, REPRESENTATIONS AND WARRANTIES OF VENDOR

      Vendor covenants with and represents and warrants to Purchaser that:

      a)    Vendor is a corporation duly organized and validly existing under
            the laws of its jurisdiction of incorporation, is authorized to
            carry on business in the Province of Saskatchewan and now has good
            right, full power and absolute authority to bargain, sell, transfer,
            assign and convey the entire interest of Vendor in and to the Assets
            for the purposes and in the manner herein provided for according to
            the true intent and meaning of this Agreement;

      b)    The execution, delivery and performance of this Agreement (i) has
            been duly and validly authorized by all requisite corporate,
            shareholders' and directors' actions, and (ii) will not result in
            any violation of, or be in conflict with, or constitute a default
            under any charter, bylaw or governing document or any term or
            provision of any agreement or instrument to which Vendor is a party
            or by which Vendor is bound nor under any judgement, decree or
            order, statute, regulation, rule or licence applicable to it;

      c)    This Agreement and other documents delivered in pursuance hereof
            constitute valid and binding obligations of Vendor enforceable
            against it in accordance with their respective terms;

      d)    The Vendor has not incurred any obligation or liability, contingent
            or otherwise, for brokers' feees or finders' fees in respect of this
            transaction for which Purchaser shall have any obligation or
            liability.

      e)    Vendor does not purport to convey any better title than it now has,
            but Vendor has done no act or thing and suffered or permitted no act
            or omission whereby its title to the Assets may be cancelled or
            determined, nor has Vendor encumbered or alienated the same or any
            interest therein save as set forth on Schedule "A" hereto, nor is
            Vendor aware of any lien or encumbrance relating to or affecting the
            Assets save as set forth on Schedule "A" hereto;

      f)    Subject to the rents, covenants, conditions and stipulations in the
            Permits reserved and contained and on the lessee's or holder's part
            thereunder to be paid, performed and observed, Purchaser may enter
            into and upon, and hold and enjoy the Assets for the residue of
            their respective terms and all renewals or extensions thereof as to
            the interests hereunder assigned for its own use and benefit without
            any lawful interruption of or by Vendor or any other person
            whomsoever claiming or to claim by, through or under Vendor and
            Vendor binds itself to warrant and defend, at its cost and expense,
            all and singular the Petroleum and Natural Gas Rights against all
            persons whomsoever claiming or to claim the same or any part thereof
            or any interest therein by, through or under Vendor;

<PAGE>
                                      -5-

      g)    To the best of its knowledge, no suit, action or other proceeding is
            pending or threatened before any court or governmental agency which
            might result in impairment or loss of Vendor's title to the Assets;

      h)    To the best of the knowledge, information and belief of Vendor the
            Permits set out in Schedule "A" are the only agreements under and by
            virtue of which Vendor acquired and holds the Petroleum and Natural
            Gas Rights;

      i)    The Vendor has not failed to comply with, perform, observe or
            satisfy any term, condition, or obligation or liablility which has
            heretofor arisen under the provisions of any of the Permits,
            documents of title and other agreements to which the Assets are
            subject;

      j)    Vendor is not aware of any defaults, has not received any notice of
            default and is not, to its knowledge, in any default under (i) any
            applicable laws or regulations, or (ii) any agreement or obligation
            by which it is bound or to which it is subject affecting the Assets;

      k)    No suit, action or other proceeding is pending or threatened before
            any judicial authority or governmental authority which might result
            in impairment or loss of Vendor's or Purchaser's title to the Assets
            or its use or enjoyment thereof;

      l)    The Vendor has done no act or suffered or permitted no action to be
            done whereby any person has acquired or may acquire any interest in
            or to the Assets, and the Assets are not subject to reduction or
            conversion by virtue of rights of first refusal, or preferential or
            first prurchase rights, conversion rights or other similar rights by
            virtue of this Agreement, or the transactions contemplated by it,
            other than in respect of permitted encumbrances as disclosed in
            Schedule "A" hereto;

      m)    The Vendor has made available for inspection by Purchaser, all
            documents, instruments, records and books relevant to title to the
            Lands and Permits, annd other documents of title in the possession
            or control of the Vendor;

      n)    To the best of its knowledge all ad valorem, property, production,
            severance and similar taxes and assessments based on or measured by
            the ownership of the Assets or the production of Petroleum
            Substances from the Lands or the receipt of proceeds therefrom
            payable to the Effective Time and all prior years have been properly
            paid;

      o)    All laws, regulations and orders of all governmental agencies,
            having jurisdiction over the Assets requiring compliance by the
            Vendor, have been complied with by the Vendor;

      p)    The Vendor has not received any claim or notice to the effect that,
            nor to its knowledge are the Assets the subject of, any remedial,
            preventative or control action, derection or order by any government
            authorities or any investigation or evalutation by any government
            authorities as wheter any remedial or preventive action in needed to
            respond to an existing or potential environmental concern;

      q)    Vendor is not non- resident within the meaning of Section 116 of the
            Income Tax Act (Canada);

10.   COVENANTS, REPRESENTATIONS AND WARRANTIES OF PURCHASER

      Purchaser covenants with and represents and warrants to Vendor that:

<PAGE>
                                      -6-

      a)    Purchaser is a corporation duly organized and validly existing under
            the laws of its jurisdiction of incorporation and now has good
            right, full power and absolute legal authority to enter into this
            Agreement for the purposes and in the manner herein provided for
            according to the true intent and meaning of this Agreement;

      b)    The execution, delivery and performance of this Agreement (i) has
            been duly and validly authorized by all requisite corporate, and
            directors' actions, and (ii) will not result in any violation of, or
            be in conflict with, or constitute a default under any charter,
            bylaw or governing document or any term or provision of any
            agreement or instrument to which Purchaser is a party or by which
            Purchaser is bound nor under any judgement, decree or order,
            statute, regulation, rule or licence applicable to it;

      c)    This Agreement has been duly executed and delivered by the Purchaser
            and, if properly executed and delivered by the Vendor, constitutes a
            valid and binding obligation of the Purchaser enforceable in
            accordance with its terms and subject to the qualification that such
            enforceability may be limited by bankruptcy, insolvency,
            liquidation, reorganization or other laws of general application
            relating to or affecting the rights of creditors and that equitable
            remedies, including specific performance, are discretionary or may
            not be ordered;

      d)    It is not a non-Canadian person for the purposes of The Investment
            Canada Act; and

      e)    It has not incurred any obligation or liability, contingent or
            otherwise, for brokers' or finders' fees in respect of this
            transaction for which Vendor shall have any obligation or liability.

11.   CONDITION OF ASSETS

      The Purchaser acknowledges that it is purchasing the Assets on an "as is,
      where is" basis and that any and all costs attributable to the Assets now,
      in the past or in the future shall be for the sole account of the
      Purchaser. In this regard the Purchaser agrees that it shall:

      a)    be solely liable for all loss, costs, damages and expenses
            whatsoever, which the Purchaser may suffer, sustain, pay or incur
            and, in addition,

      b)    indemnify the Vendor against all actions, proceedings, claims,
            demands, loss, costs, damages and expenses whatsoever which may be
            brought against or suffered by the Vendor or which it may sustain,
            pay or incur, as a result of any act, omission, matter or thing
            relating to the Assets, done, omitted, occurring or accruing prior
            to or after the Effective Date, with respect to any and all
            environmental damage or reclamation costs howsoever and whenever
            arising.

12.   SURVIVAL OF COVENANTS

      The covenants, representations and warranties contained herein shall
      survive the purchase and sale herein provided for and shall continue and
      remain in full force and effect for the benefit of Purchaser with respect
      to Clause 9 and for the benefit of Vendor with respect to Clause 10 for a
      period of one (1) year from the date hereof.

13.   BREACH

      Notwithstanding anything to the contrary herein expressed or implied, it
      is expressly agreed and understood that the covenants, representations and
      warranties set forth in Clauses 9 and 10 were true at the Effective Time,
      are true on the date hereof and shall be repeated at the Closing Time as
      being true in all material respect at the Effective Time and at the
      Closing Time and, notwithstanding the Closing and/or deliveries of
      covenants, representations and warranties in any other agreement at
      Closing or prior or subsequent thereto or investigations by parties hereto
      or their counsel, the covenants, representations and warranties set forth
      in Clauses 9 and 10 shall survive Closing for the benefit of the parties
      hereto.

<PAGE>
                                      -7-

14.   INDEMNITY

      Except as provided for in Clause 13 hereto, Vendor shall continue to
      remain liable and indemnify Purchaser from and against any liability,
      loss, costs, claims or damages arising out of or pertaining to the Assets
      and occurring or arising prior to the Effective Time and Purchaser shall
      indemnify Vendor from and against similar liability, loss, costs, claims
      or damages arising out of or pertaining to the Assets subsequent to the
      Effective Time excepting in each case any liability, loss, costs, claims
      or damages to the extent that the same are reimbursed by insurance or
      caused by the negligence of the other party hereto. Such indemnities shall
      be deemed to apply to all assignments, transfers, conveyances, novations
      and other documents conveying the Assets to the Purchaser. Each party
      shall have full right of substitution and subrogation in and to all
      covenants and warranties by others heretofore given or made in respect of
      the Assets or any part thereof.

15.   FURTHER ASSURANCES

      Vendor and Purchaser will, from time to time and at all times hereafter,
      at the request of the other, but without further consideration, do such
      further acts and deliver all such further assurances, deeds and documents
      as shall be reasonably required in order to fully perform and carry out
      the terms of this Agreement.

16.   GOVERNING LAW

      This Agreement shall, in all respects, be subject to and interpreted,
      construed and enforced in accordance with and under the laws of the
      Province of Alberta and shall, in every regard, be treated as a contract
      made in the Province of Alberta. The parties hereto irrevocably attorn and
      submit to the jurisdiction of the courts of the Province of Alberta in
      respect of all matters arising out of this Agreement.

17.   ENUREMENT

      This Agreement shall be binding upon and shall enure to the benefit of
      each of the parties hereto and their respective administrators, trustees,
      receivers, successors and assigns.

18.   TIME OF ESSENCE

      Time is of the essence of this Agreement.

19.   NOTICES

      The addresses for service of the parties hereto shall be as follows:

         Vendor:    Powermax Energy Inc.
                    1000, 330 - 5th Avenue SW
                    Calgary, Alberta   T2M 0L4

         Purchaser: 808099 Alberta Ltd
                    Suite 1250, 639 - 5th Avenue SW
                    Calgary, Alberta T2P 0M9

<PAGE>
                                      -8-

      Any of the parties hereto may from time to time change its address for
      service hereby by giving written notice to the other party hereto. Any
      notice may be served by mailing the same by prepaid post in a properly
      addressed envelope addressed to the other parties hereto at such parties'
      address for service hereunder. Any notice so served shall be deemed to be
      given to and received by the addressee on the third day, except Saturdays,
      Sundays and holidays, after the mailing hereof.

20.   PRIOR AGREEMENTS AND AMENDMENTS

      This Agreement shall supersede and replace any and all prior agreements
      between the parties hereto relating to the sale and purchase of the Assets
      and may be amended only by written instrument signed by all parties
      hereto.

21.   FACSIMILE

      This Agreement and any document or instrument to be executed and delivered
      by the Parties hereunder or in connection herewith may be executed and
      delivered in separate counterparts and delivered by one party to the other
      by facsimile, each of which when so executed and delivered shall be deemed
      an original and all such counterparts shall together constitute one and
      the same agreement. If this Agreement or any such document or instument is
      delivered by facsimile, the Party so delivering this Agreement or such
      document or instrument shall within a reasonable time after Closing,
      deliver an originally executed copy to the other.

22.   ENTIRE AGREEMENT

      This instrument states the entire agreement between the parties hereto.

      IN WITNESS WHEREOF the parties hereto have executed this Agreement as of
the date first above written.

POWERMAX ENERGY INC.                    808099 ALBERTA LTD

/s/ Neil K. Answorth- Director          /s/
------------------------------------    ----------------------------------------
(Vendor)                                (Purchaser)

<PAGE>
                                      -9-

                                  SCHEDULE "A"
        This is Schedule "A" attached to and forming part of an Agreement
              of Purchase and Sale Dated September 29, 2004 between
                  Powermax Energy Inc. and 808099 Alberta Ltd.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
            Permits                                  Lands                          Interest Conveyed          Encumbrances
-----------------------------------------------------------------------------------------------------------------------------
<S>                              <C>                                            <C>                         <C>
Saskatchewan Oil Shale           Twp 92, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00205     Twp 92, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 92, Rge 24, W3M: Secs 1-36                                               reserved to
                                 Twp 92, Rge 25, W3M: Secs 1-5, ptn6, ptn 7,                                 Stripper Energy
                                 secs 8-17, ptn18, ptn 19, secs 20-29, ptn 30,                               Services Limited
                                 ptn 31, secs 32-36                                                           based on 100%
                                 (containing 88,782 acres)                                                    Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 93, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00206     Twp 93, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 93, Rge 24, W3M: Secs 1-36                                              reserved to Twp
                                 93, Rge 25, W3M: Secs 1-5, ptn6, ptn 7,                                     Stripper Energy
                                 secs 8-17, ptn18, ptn 19, secs 20-29, ptn 30,                               Services Limited
                                 ptn 31, secs 32-36                                                           based on 100%
                                 (containing 88,782 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 93, Rge 18, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00207     Twp 93, Rge 19, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 93, Rge 20, W3M: Secs 1-36                                                reserved to
                                 Twp 93, Rge 21, W3M: Secs 1-36                                              Stripper Energy
                                 (containing 92,160 acres)                                                   Services Limited
                                                                                                              based on 100%
                                                                                                             Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 94, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00208     Twp 94, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 94, Rge 24, W3M: Secs 1-36                                               reserved to Twp
                                 94, Rge 25, W3M: Secs 1-5, ptn6, ptn 7,                                      Stripper Energy
                                 secs 8-17, ptn18, ptn 19, secs 20-29, ptn 30,                               Services Limited
                                 ptn 31, secs 32-36                                                            based on 100%
                                 (containing 88,692 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 94, Rge 19, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00209     Twp 95, Rge 19, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 94, Rge 20, W3M: Secs 1-36                                                reserved to
                                 Twp 94, Rge 21, W3M: Secs 1-36                                              Stripper Energy
                                 (containing 92,160 acres)                                                   Services Limited
                                                                                                              based on 100%
                                                                                                             Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 95, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00210     Twp 95, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 95, Rge 24, W3M: Secs 1-36                                                reserved to
                                 Twp 95, Rge 25, W3M: Secs 1-3, ptn4, ptn 9,                                 Stripper Energy
                                 secs 10-15, ptn 16, ptn 21, secs 22-27, ptn                                 Services Limited
                                 28, ptn 33, secs 34-36.                                                      based on 100%
                                 (containing 83,460 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 95, Rge 20,W3M: Secs 1-36                  49% Working Interest            2.5% Gross
Exploration Permit # PS00211     Twp 96, Rge 20,W3M: Secs 1-36                                              Overriding Royalty
                                 Twp 95, Rge 21,W3M: Secs 1-36                                                 reserved to
                                 Twp 96, Rge 21,W3M: Secs 1-36                                               Stripper Energy
                                 (containing 92,160 acres)                                                   Services Limited
                                                                                                              based on 100%
                                                                                                             Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 96, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00212     Twp 96, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 96, Rge 24, W3M: Secs 1-36                                                reserved to
                                 Twp 96, Rge 25, W3M: Secs 1-3, ptn4, ptn 9,                                 Stripper Energy
                                 secs 10-15, ptn 16, ptn 21, secs 22-27, ptn                                 Services Limited
                                 28, ptn 33, secs 34-36.                                                      based on 100%
                                 (containing 83,432 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 97, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00213     Twp 97, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 97, Rge 24, W3M: Secs 1-36                                                reserved to
                                 Twp 97, Rge 25, W3M: Secs 1-3, ptn4, ptn 9,                                 Stripper Energy
                                 secs 10-15, ptn 16, ptn 21, secs 22-27, ptn                                 Services Limited
                                 28, ptn 33, secs 34-36.                                                      based on 100%
                                 (containing 83,360 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
                                      -10-

<TABLE>
-----------------------------------------------------------------------------------------------------------------------------
<S>                              <C>                                            <C>                         <C>
Saskatchewan Oil Shale           Twp 97, Rge 21, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00214     Twp 98, Rge 21, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 99, Rge 21, W3M: Secs 1-36                                                reserved to
                                 Twp 100, Rge 21, W3M: Secs 1-36                                             Stripper Energy
                                 (containing 92,160 acres)                                                   Services Limited
                                                                                                              based on 100%
                                                                                                             Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 98, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00215     Twp 98, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 98, Rge 24, W3M: Secs 1-36                                                reserved to
                                 Twp 98, Rge 25, W3M: Secs 1-3, ptn4, ptn 9,                                 Stripper Energy
                                 secs 10-15, ptn 16, ptn 21, secs 22-27, ptn                                 Services Limited
                                 28, ptn 33, secs 34-36.                                                      based on 100%
                                 (containing 83,340 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 99, Rge 22, W3M: Secs 1-36                 49% Working Interest            2.5% Gross
Exploration Permit # PS00216     Twp 99, Rge 23, W3M: Secs 1-36                                             Overriding Royalty
                                 Twp 99, Rge 24, W3M: Secs 1-36                                              reserved to Twp
                                 99, Rge 25, W3M: Secs 1-2, ptn 3, ptn                                       Stripper Energy
                                 10, secs 11-14, ptn 15, ptn 22, secs 23-26,                                 Services Limited
                                 ptn 27, ptn 34, secs 35-36                                                    based on 100%
                                 (containing 78,006 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 100, Rge 22, W3M: Secs 1-12                49% Working Interest            2.5% Gross
Exploration Permit # PS00217     Twp 100, Rge 22, W3M: Secs 14-36                                           Overriding Royalty
                                 Twp 100, Rge 23, W3M: Secs 1-36                                               reserved to
                                 Twp 100, Rge 24, W3M: Secs 1-36                                             Stripper Energy
                                 Twp 100, Rge 25, W3M: Secs 1-2, ptn 3, ptn                                  Services Limited
                                 10, secs 11-14, ptn 15, ptn 22, secs 23-26,                                  based on 100%
                                 ptn 27, ptn 34, secs 35-36                                                  Working Interest
                                 (containing 78,360 acres)
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 101, Rge 22, W3M: Secs 1-36                49% Working Interest            2.5% Gross
Exploration Permit # PS00218     Twp 101, Rge 23, W3M: Secs 1-36                                            Overriding Royalty
                                 Twp 101, Rge 24, W3M: Secs 1-36                                              reserved to Twp
                                 101, Rge 25, W3M: Secs 1-2, ptn 3, ptn                                       Stripper Energy
                                 10, secs 11-14, ptn 15, ptn 22, secs                                         Services Limited
                                 23-26, ptn 27, ptn 34, secs                                                   based on 100%
                                 35-36 (containing 77,958 acres)                                              Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 102, Rge 22, W3M: Secs 1-36                49% Working Interest            2.5% Gross
Exploration Permit # PS00219     Twp 102, Rge 23, W3M: Secs 3-10, 15-22, 25,                                Overriding Royalty
                                 27-34, 36                                                                     reserved to
                                 Twp 102, Rge 24, W3M: Secs 1-36                                             Stripper Energy
                                 Twp 102, Rge 25, W3M: Secs 1-2, ptn 3, ptn                                  Services Limited
                                 10, secs 11-14, ptn 15, ptn 22, secs 23-26,                                  based on 100%
                                 ptn 27, ptn 34, secs 35-36                                                  Working Interest
                                 (containing 71,552 acres)
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 101, Rge 21, W3M: Secs 1-36                49% Working Interest            2.5% Gross
Exploration Permit # PS00220     Twp 102, Rge 21, W3M: Secs 1-36                                            Overriding Royalty
                                 Twp 103, Rge 21, W3M: Secs 1-36                                               reserved to
                                 (containing 69,120 acres)                                                   Stripper Energy
                                                                                                             Services Limited
                                                                                                              based on 100%
                                                                                                             Working Interest
-----------------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale           Twp 103, Rge 22, W3M: Secs 1-36                49% Working Interest            2.5% Gross
Exploration Permit # PS00221     Twp 103, Rge 23, W3M: Secs 14-36                                           Overriding Royalty
                                 Twp 103, Rge 24, W3M: Secs 1-20,23-26,                                        reserved to
                                 29-32, 35, 36                                                               Stripper Energy
                                 Twp 103, Rge 25, W3M: Ptn 1, ptn 12, ptn 13,                                Services Limited
                                 ptn 24, ptn 25, ptn 36.                                                      based on 100%
                                 (containing 68,754 acres)                                                   Working Interest
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
                                      -11-

                                  SCHEDULE "B"

THIS IS SCHEDULE "B" ATTACHED TO AND FORMING PART OF A PETROLEUM, NATURAL GAS
AND GENERAL RIGHTS CONVEYANCE DATED SEPTEMBER 29, 2004 BETWEEN POWERMAX ENERGY
INC. AND 808099 ALBERTA LTD.
--------------------------------------------------------------------------------
              PETROLEUM, NATURAL GAS AND GENERAL RIGHTS CONVEYANCE

(A) Vendor and Purchaser entered into that Agreement made as of the 16th day of
July, 2004 (the "Purchase and Sale Agreement") with respect to the Assets,
(which term, when used in this Agreement, has the same meaning as in the Sale
Agreement):

(B) All of the conditions precedent to the obligations of the parties hereto to
close the transactions contemplated by the Sale Agreement have either been
fulfilled or waived in the manner provided for waiver in the Sale Agreement;

      NOW THEREFORE in consideration of the premises hereto and the covenants
and agreements hereinafter set forth and contained, the parties hereto covenant
and agree as follows:

1. Vendor hereby sells, assigns, transfers, conveys and sets over to the
Purchaser, and Purchaser hereby purchases from Vendor, a portion of the right,
title, estate and interest of Vendor (whether absolute or contingent, legal or
beneficial) in and to the Assets, TO HAVE AND TO HOLD the same, together with
all benefit and advantage to be derived therefrom, absolutely, subject to the
terms of the Sale Agreement.

2. The covenants, representations, warranties and indemnities contained in the
Sale Agreement are incorporated herein as fully and effectively as if they were
set out herein and there shall not be any merger of any covenant,
representation, warranty or indemnity contained in the Sale Agreement by virtue
of the execution and delivery hereof, any rule of law, equity or statute to the
contrary notwithstanding.

3. If any term or provision hereof should conflict with any term or provision of
the Sale Agreement, the term and provision of the latter shall prevail and this
Agreement shall at all times be read subject to all terms and conditions of the
Sale Agreement.

4. The assignment and conveyance effected by this Agreement is made with full
right of substitution of Purchaser in and to all covenants, representations,
warranties and indemnities by others heretofore given or made in respect of the
Assets or any part thereof.

5. This Agreement shall, in all respects, be subject to and interpreted,
construed and enforced in accordance with and under the laws of the Province of
Alberta and shall, in every regard, be treated as a contract made in the
Province of Alberta. The parties hereto irrevocably attorn and submit to the
jurisdiction of the courts of the Province of Alberta in respect of all matters
arising out of or in connection with this Agreement.

6. This Agreement shall be binding upon and shall enure to the benefit of each
of the parties hereto and their respective administrators, trustees, receivers,
successors and assigns.

      IN WITNESS WHEREOF the parties hereto have executed this Agreement as of
the 21st day of September, 2004.

POWERMAX ENERGY INC.                    808099 ALBERTA LTD
(VENDOR)                                (PURCHASER)

___________________________________     /s/_____________________________________

/s/ Neil K. Answorth- Director
___________________________________     ________________________________________GROSS OVERRIDING ROYALTY AGREEMENT

                           (FIREBAG AREA SASKATCHEWAN)

      THIS AGREEMENT made effective as of the 29th day of September, 2004.

BETWEEN:

            STRIPPER ENERGY SERVICES LIMITED., a corporation having an office in
            the City of Calgary, in the Province of Alberta (hereinafter
            referred to as "Royalty Owner")

                                     - and -

            808099 ALBERTA LTD. a corporation having an office in the City of
            Vancouver, in the Province of British Columbia (hereinafter referred
            to as "Grantor")

      WHEREAS the Powermax Energy Inc. and the Grantor have agreed to a sale,
purchase and conveyance of certain working interests in the royalty lands to the
Grantor, pursuant to the terms and conditions of an Agreement of Purchase and
Sale (hereinafter referred to as the Sale Agreement) made effective September
29, 2004; and

      WHEREAS as a condition precedent of the Sale Agreement, the Grantor has
agreed that a royalty is payable and to grant and pay to the Royalty Owner a
non-convertible gross overriding royalty on a one hundred (100%) percent
interest in the royalty lands; and

      WHEREAS the parties desire to document this gross overriding royalty.

      NOW THEREFORE THIS AGREEMENT WITNESSETH that the parties hereto agree as
follows:

1.    Definitions

      Notwithstanding the jurisdiction in which the royalty lands may be
      situated, the parties hereto agree that, as among themselves, the
      definitions set out in the Oil and Gas Conservation Act, R.S.A. 1980,
      C.O-5, as amended, together with the definitions set out in the 1990 CAPL
      Operating Procedure, as such definitions pertain to any and all substances
      constituting Petroleum Substances, shall be applicable for the purpose of
      interpreting this Agreement, except insofar as any such definition may
      have been modified, as provided hereunder:

      (a)   "Assignment Procedure" means the 1993 CAPL Assignment Procedure.;

      (b)   "condensate" has the meaning set out in the Oil and Gas Conservation
            Act, R.S.A. 1980 C.0-5;

      (c)   "crude oil" means a mixture mainly of pentane and heavier
            hydrocarbons (whether or not contaminated with sulphur compounds)
            that is recovered at a well from an underground reservoir and that
            is liquid at the conditions under which its volume is measured or
            estimated and shall include crude naphtha or condensate that is so
            recovered;

      (d)   "current market value" means the price received by the Grantor at
            the point of measurement for its share of petroleum substances
            produced and marketed from, or allocated to, the royalty lands
            pursuant to a scheme of pooling or unitization which price shall not
            be less than that which the Grantor would have received at the
            wellhead if acting as a reasonably prudent operator having regard to
            the current market prices, availability to market and economic
            conditions of the petroleum industry generally.

<PAGE>
                                     - 2 -

      (e)   "natural gas" shall mean raw gas or marketable gas as the context so
            requires, and as those terms are defined in the Oil and Gas
            Conservation Act for the Province of Alberta;

      (f)   "Operating Procedure" means the 1990 CAPL Operating Procedure.;

      (g)   "Petroleum Substances" means all crude oil, natural gas and related
            hydrocarbons and any other substances, whether fluids or solids and
            whether hydrocarbons or not, but only insofar as and to the extent
            the same are granted by the title document.

      (h)   "point of measurement" shall mean the production tankage in the case
            of crude oil, the wellhead in the case of natural gas and the point
            of delivery for all other petroleum substances.

      (i)   "Regulations" means all statues, laws, rules, orders and regulations
            in effect from time to time and made by governmental authorities
            having jurisdiction over the royalty lands and over the operations
            to be conducted thereon;

      (j)   "royalty lands" means the lands more particularly described and from
            time to time remaining in Schedule "A".

      (k)   "title document" means the documents of title by virtue of which the
            holders thereof are entitled to drill for, win, take or remove
            Petroleum Substances underlying all or any part of the royalty lands
            and includes all renewals or extensions thereof or other title
            documents issued thereunder or in substitution therefor.

2.    Reservation of Royalty

      (a)   Grantor hereby grants and assigns to the Royalty Owner a gross
            overriding royalty equal to two and one half percent (2.5%) of the
            current market value on one hundred percent (100%) of all petroleum
            substances produced, saved and marketed from the royalty lands
            (hereinafter referred to as the "royalty").

      (b)   The royalty shall be in addition to the royalties payable under and
            pursuant to the title document. The royalty shall be paid to the
            Royalty Owner during the term of the title document and any renewal,
            extension, variation or replacement thereof.

      (c)   If any petroleum substances are sold at less than current market
            value in any transaction (including those transactions which are not
            at arm's length or any transaction involving any arrangement from
            which the Grantor obtains a collateral advantage in consideration of
            a reduced price, the gross proceeds of sale of such petroleum
            substances for the purposes of calculating the royalty under
            subclause 2(a) hereof shall be deemed to be not less than the
            current market value of those Petroleum Substances when sold.

      (d)   If any well drilled on the royalty lands is classified by the
            appropriate governmental authority as an oil well; and is completed
            in more than one producing oil zone and the production therefrom is
            segregated and accounted for separately in accordance with the
            Regulations, then the computation of the royalty provided for in
            subclause 2(a) hereof shall be made separately for each producing
            zone rather than for the total production from such well.

<PAGE>
                                     - 3 -

3.    Commingling Production

      The Grantor shall have the right to commingle Petroleum Substances
      produced from the royalty lands with Petroleum Substances produced from
      other lands provided methods acceptable to the Royalty Owner are used to
      determine the proper measurement of individual well production.

      Where Governmental regulations or orders require segregated production
      tests of individual wells at intervals not greater than two months, such
      tests will be deemed acceptable to the Royalty Owner under this Clause and
      no further tests will be required.

4.    Right to Pool or Unitize

      Grantor is hereby given the right and authority, at any time and from time
      to time, to pool the royalty lands, or any portion thereof or to unitize
      the royalty lands or any portion thereof, or any zone or formation
      underlying the royalty lands, or any portion thereof, with any other lands
      or any zone or formation underlying the same, on reasonable terms and
      conditions. In the event of such pooling or unitization, the Royalty Owner
      shall, in lieu of the royalty, receive royalty at the rate herein
      specified but calculated on that portion of the production of the
      Petroleum Substances from the area so pooled or unitized which is
      allocated to that portion of the royalty lands which is contributed to the
      pooled or unitized area pursuant to the pooling or unitization agreement
      concerned.

5.    Operations

      Grantor may use any of the petroleum substances produced from the royalty
      lands or allocated thereto pursuant to a pooling and unitization agreement
      in its operations on or in respect to the royalty lands and the Royalty
      Owner shall own no royalty hereunder in the Petroleum Substances so used.

6.    Taking in Kind

      (a) Royalty Owner may by notice to Grantor elect to take its royalty in
      kind or to revoke any previous election made by it to take in kind,
      provided that Royalty Owner may not make an election with respect to any
      of the Petroleum Substances within one hundred and eighty (180) days after
      any prior election relating to that same portion of the Petroleum
      Substances. Such election to take in kind may be exercised separately with
      respect to crude oil, natural gas and condensate. If Royalty Owner elects
      to take its royalty in kind, the percentages and measurement criteria
      stipulated in Clause 2 hereof shall apply to the quantities of Petroleum
      Substances produced and saved at the wellhead instead of the gross
      proceeds of sale or the current market value thereof, as the case may be.
      Commencing with the month next following sixty (60) days after receipt of
      such notice, Grantor, in accordance with the notice and as provided in
      Clause 7 hereof, shall either:

            (i) deliver to the Royalty Owner or to its nominee, the Royalty
            Owner's royalty share of all petroleum substances produced from the
            royalty lands which Royalty Owner has elected to take as provided
            above, or

            (ii) pay the royalty in cash as provided in Clause 2 hereof.

<PAGE>
                                     - 4 -

      (b)   Any such election by the Royalty Owner to take in kind shall be
            subject to the terms of any sales contracts which Grantor may have
            previously made with respect to production of petroleum substances
            from the royalty lands which shall be consistent with the minimum
            needs of the industry under the circumstances but shall not, however
            exceed one (1) year without the Royalty Owner's written approval.

      (c)   If the Royalty Owner elects to take its royalty share or crude oil
            in kind, Grantor shall:

            (i)   at no cost or charge to the Royalty Owner, remove basic
                  sediment and water from the Royalty Owner's share of crude oil
                  in accordance with normal oilfield practices so that pipeline
                  specifications in that regard are met, and

            (ii)  at the request of the Royalty Owner, provide production
                  tankage capacity for not more than ten (10) days' accumulation
                  of the Royalty Owner's share of crude oil and Grantor shall
                  deliver the same to the Royalty Owner, or to the Royalty
                  Owner's nominee, at the tank outlets in accordance with usual
                  customary shipping practice, free and clear of all charges
                  whatsoever.

      (d)   If the Royalty Owner elects to take its royalty share of petroleum
            substances other than crude oil in kind, the Royalty Owner shall
            either take its share thereof at the wellhead or shall make
            arrangements for the processing of such substances.

7.    Sale of Royalty

      (a)   When and so often as the Royalty Owner shall fail or refuse to take
            the royalty in kind and separately dispose of the same, the Grantor
            shall have the authority, revocable by the Royalty Owner at will
            (subject to any existing sales contracts) to sell, and shall sell
            for the account of the Royalty Owner, the royalty for such periods
            of time as are consistent with the minimum needs of the industry
            under the circumstances, but in no event shall any contract be for a
            period in excess of one (1) year.

      (b)   The Grantor shall pay to the Royalty Owner, for the royalty sold or
            purchased by the Grantor, the current market value thereof on or
            before the first day of the second month following the month of
            production and shall include therewith a complete statement of
            inventories, production and sales for the month of production.

      (c)   If any royalty remains unpaid at the expiration of the period
            specified above, Royalty Owner may, by notice, advise the Grantor of
            same. If the Grantor does not pay the royalty within thirty (30)
            days of receipt of such notice, then from the expiration of the
            period specified above, the unpaid amount shall bear interest at the
            prime rate plus two percent (2%) per annum until paid. In this
            subclause, "prime rate" means the rate of interest expressed as a
            percentage per annum used and announced by the Canadian Imperial
            Bank of Commerce as a reference rate then in effect for determining
            interest on Canadian dollar commercial loans in Canada. The prime
            rate shall be determined on the last day of each month and applied
            to the next succeeding month.

      (d)   Grantor shall maintain complete and accurate records of the
            petroleum substances produced, or deemed to have been produced,
            saved and sold from the royalty lands and of the monies received
            therefrom and shall forward with each payment of royalty hereunder a
            statement giving sufficient detail for the Royalty Owner to
            ascertain the accuracy of the payment made therewith. The Grantor
            shall also forward to the Royalty Owner a copy of Grantor's
            governmental production statement for the month for which the
            royalty is calculated and, with respect to Crown permits, a copy of
            the Crown royalty statement with respect to those permits.

<PAGE>
                                     - 5 -

8.    Deductions

      There are no deductions allowed to be taken by the Grantor (for the
      purposes of calculating the royalty payments), and all royalty amounts
      owing and payable under this agreement shall be calculated as determined
      by the volumes produced at the wellhead or other reservoir proximity to
      in-situ equivalent thereto. It is also agreed to that the Royalty Owner
      shall have the right to register this royalty interest on the lands and
      that regardless of such registration, the royalty is deemed to be an
      interest in land and as such will have all of the legal rights associated
      with an interest in land.

9.    Ratable Production

      The Grantor shall make every reasonable endeavor within its legal
      authority to market any of the Petroleum Substances produced or capable of
      being produced from the royalty lands rateably with any other similar
      substances produced from any lands within the same field in which the
      Grantor, its parent or subsidiary or subsidiary of its parent has an
      interest and further the Grantor covenants that it will not discriminate
      against the petroleum substances produced or capable of being produced
      from the royalty lands in the production and marketing of the same.

10.   Indemnity

      The Grantor shall indemnify and save harmless the Royalty Owner from and
      against all actions, suits, claims and demands whatsoever by any person or
      persons whomsoever, and in respect of any loss, injury, damage or
      obligation arising out of or connected with any of the operations of the
      Grantor conducted on the royalty lands.

11.   Grantor Not Obliged to Develop

      Notwithstanding any provision herein contained, Grantor shall be under no
      obligation to the Royalty Owner to develop the royalty lands or any part
      thereof or to produce the Petroleum Substances which may be within, upon
      or under the royalty lands.

12.   Force Majeure

      None of the parties hereto shall be deemed to be in default in respect to
      non-performance of their obligations hereunder if and so long as their
      non-performance is due to strikes, lockouts, fire, tempest or acts of God
      or the queen's enemies, or any other cause (whether similar or dissimilar
      to those enumerated) beyond its control, but lack of finances shall not in
      any event be deemed to be a cause beyond the control of a party.

13.   Surrender

      Grantor may at any time and from time to time surrender the title document
      or any severable part thereof upon giving the Royalty Owner at least sixty
      (60) days notice in writing (herein called "the surrender notice"), before
      the accrual of a rental or other obligation under the title document, of
      its intention so to surrender specifying the effective date of such
      surrender and in the case of a partial surrender the lands intended to be
      surrendered. Unless the Royalty Owner, within thirty (30) days of the
      service of the surrender notice, gives notice in writing to the Grantor
      requiring an assignment of the title document to the extent that it
      comprises the lands referred to in the surrender notice, the Grantor may
      surrender same and thereupon all of the Grantor's obligations under this
      Agreement with respect to the interest so surrendered shall cease. If the
      Royalty Owner, within thirty (30) days gives notice in writing to Grantor
      requiring an assignment as aforesaid the Grantor shall forthwith deliver
      to the Royalty Owner a proper assignment, in favour of the Royalty Owner,
      of the title document to the extent that it comprises the lands subject to
      the surrender notice, and the Grantor thereafter shall be under no
      liability under this Agreement in any manner whatsoever in connection with
      the interest so assigned and the Royalty Owner shall indemnify and save
      the Grantor harmless from all obligations which shall accrue under the
      title document in respect of such lands from the effective date of the
      surrender.

<PAGE>
                                     - 6 -

14.   Records

      Grantor shall maintain in Canada at all times current books, records and
      accounts showing the quantity of Petroleum Substances taken out of each
      well drilled on the royalty lands, or allocated to the royalty lands, and
      the disposition thereof, and shall permit the royalty Owner to inspect or
      audit the same and to make copies thereof. Insofar as Grantor may grant
      such right, it shall permit the employees or agents of Royalty Owner to
      enter upon the royalty lands, or any other lands from which Petroleum
      Substances subject to the royalty are produced, at its sole risk and
      expense for the purpose of ascertaining the quantity and nature of the
      Petroleum Substances produced from any well thereon. All information
      obtained by Royalty Owner pursuant to this clause shall be treated as
      confidential and shall not be disclosed to third persons without prior
      written consent of the Grantor.

15.   Audits

      (a)   The Royalty Owner, by reasonable notice to Grantor and at its own
            expense may audit Grantor's books, accounts and records for a
            calendar year relating to the production, disposition and sale of
            the Petroleum Substances with respect to which Grantor is required
            to pay the Royalty Owner's royalty, provided that such audit shall
            be conducted and completed within twenty-six (26) months following
            the end of such calendar year and shall be conducted so as to cause
            Grantor a minimum of inconvenience. Upon receiving notice that the
            Royalty Owner wishes to conduct an audit, Grantor, at its own
            expense, shall make available the said books, accounts and records
            in Alberta and shall permit the Royalty Owner to conduct the audit
            during normal business hours. Grantor shall, within three (3) months
            following completion of the audit, take required action to resolve
            the claims or discrepancies disclosed by that audit and if it does
            not do so, the results of the audit shall be deemed to be correct.
            If required, Grantee shall be entitled to a face-to-face meeting to
            resolve the claims and discrepancies, and Grantor shall attend with
            representatives with sufficient seniority to make effective and
            binding decisions on behalf of Grantor.

      (b)   The Royalty Owner may also, through its servants or agents, and at
            its sole risk and expense, enter on the royalty lands and at all
            reasonable times gauge tanks, check the quantities of Petroleum
            Substances in storage, witness tests and otherwise view operations
            on the royalty lands.

      (c)   Any payment made or statement rendered by Grantor hereunder which is
            not disputed by the Royalty Owner within three (3) months from the
            last day during which the Royalty Owner may, under subclause 16(a)
            hereof, conduct an audit in connection with such payment or
            statement shall be deemed to have been correct.

<PAGE>
                                     - 7 -

16.   Remedies

      (a)   The Royalty Owner shall be entitled to and shall have a first and
            paramount charge upon Grantor's share of all Petroleum Substances
            from time to time produced from the royalty lands to secure the
            payment of any cash payment in respect of the royalty. Such charge
            shall be first and paramount with respect to all other liens,
            charges and encumbrances against Grantor's share of all Petroleum
            Substances and shall not operate to release Grantor from personal
            liability for monies due to the Royalty Owner. Such charge shall
            attach to Grantor's share of Petroleum Substances sold or otherwise
            disposed of from the royalty lands and immediately on default
            occurring in payment by Grantor of monies payable to the Royalty
            Owner, such charge shall operate as an assignment to the Royalty
            Owner of the consideration thereafter payable to Grantor for the
            Petroleum Substances sold up to the amount owed to the Royalty Owner
            and not so paid by Grantor.

      (b)   Service of a copy of this Agreement upon any purchaser of Petroleum
            Substances together with written notice from the Royalty Owner
            setting forth the amount owed to the royalty Owner shall constitute
            written authorization on the part of Grantor for such purchaser to
            pay the Royalty Owner the proceeds from any sale or sales of
            Grantor's share of Petroleum Substances up to the amount owed to the
            Royalty Owner by Grantor, and such purchaser is authorized to rely
            upon the statement of the Royalty Owner as to the amount owed to it
            by Grantor. The Royalty Owner shall also serve Grantor with a copy
            of the written notice at the same time the notice is served upon the
            purchaser of Petroleum Substances.

      (c)   Without restricting any other rights which the Royalty Owner may
            have under this Agreement or at law, the Royalty Owner shall have
            the right to recover any overdue payments thereunder by setting off
            the amount thereof against any other Monies whatsoever which may now
            or in future be or become owing by the Royalty Owner to Grantor.

17.   Assignment by Grantor

      Grantor may assign any legal or equitable interest in this Agreement, the
      royalty lands, the title document or any portion or portions thereof and
      in the event of such assignment, the Grantor shall continue to be bound by
      all of the conditions and provisions of this Agreement as if there had
      been no assignment until such time as the Royalty Owner shall have been
      served with a copy of the assignment and a written undertaking under seal
      by the Grantor, directly enforceable by the Royalty Owner, to perform and
      be bound thereafter by all of the terms and provisions of this Agreement
      to the same extent and degree, with respect to the interest which has been
      assigned to it, as it would have been if it had been a party to this
      Agreement in the place and stead of Grantor. Any assignment thereunder
      shall be made in accordance with the Assignment Procedure.

18.   Assignment by the Royalty Owner

      The Royalty Owner may at any time assign, all or part of its interest
      thereunder provided that if at any time the share of the royalty payable
      to the Royalty Owner becomes held by more than one entity, Grantor may
      require that all entities claiming such share appoint in writing an agent
      to deal with claiming such share appoint in writing an agent to deal with
      Grantor hereunder and to receive all payments of that share of the royalty
      for distribution to the holders thereof. If such holder neglects or
      refuses to appoint such an agent, the Grantor may withhold payment of the
      royalty until such agent is appointed. In the event of such disposition,
      the Royalty Owner shall continue to be bound by all of the conditions and
      provisions of this Agreement as if there had been no disposition until
      such time as Grantor shall have been served with a copy of the assignment
      and a written undertaking under seal by the royalty Owner, directly
      enforceable by the Grantor, to perform and be bound thereafter by all of
      the terms and provisions of this Agreement to the same extent and degree,
      with respect to the interest which has been assigned to it, as it would
      have been if it had been a party to this Agreement in the place and stead
      of the Royalty Owner. Any assignment hereunder shall be made in accordance
      with the Assignment Procedure.

<PAGE>
                                     - 8 -

19.   Service of Notice

      All payments hereunder in respect of the royalty shall be paid or tendered
      to the Royalty Owner at the address shown herein for service of notices
      which shall continue to be the place for payment of any and all sums
      payable hereunder regardless of change of ownership, whether by assignment
      or otherwise, until the Grantor has been notified by the Royalty Owner in
      writing to make such payment to any other payee whose name and address
      shall be specified in such notices. Notices may be serviced:

      (a)   Personally by leaving them with the party on whom they are to be
            served at that party's address hereinafter given. Personally served
            notices shall be deemed received by the addressees when actually
            delivered provided such delivery shall be normal business hours; or

      (b)   by telephone (or by any other like method by which a written and
            recorded message may be sent) directed to the party on whom they are
            to be served at that party's address hereinafter given. Notices so
            served shall be deemed received by the addresses thereof eight hours
            after the time of transmission or at the commencement of the next
            ensuing normal business day, whichever is the later, or

      (c)   by mailing them first class (air mail it to or from the United
            States of America) registered post, postage prepaid to the party on
            whom they are to be served. Notices so served shall be deemed to be
            received by the addressees on the fifth day (excluding Saturdays,
            Sundays and Statutory Holidays) following the mailing thereof in
            Canada or the United States of America.

            The address of each of the respective parties hereto shall be as
            follows:

            808099 Alberta Ltd.               Stripper Energy Services Limited
            1250, 639 -5th Avenue SW          1000, 330 5th Avenue S.W.
            Calgary AB T2P 0M9                Calgary, Alberta. T2P 0L4

            Any party hereto may change its said address by written notice
            served as aforesaid.

20.   Further Assurances

      Each of the parties hereto shall, from time to time and at all times, do
      such further acts and deliver all such further assurances, deeds and
      documents as shall be reasonably required in order to fully perform and
      carry out the terms of this Agreement.

<PAGE>
                                     - 9 -

21.   Supersedes Previous Agreements

      This Agreement supersedes all other agreements, documents, writings and
      verbal understandings between the parties hereto relating to the royalty
      lands.

22.   Laws of Jurisdiction

      This Agreement shall be construed and interpreted in accordance with the
      laws of the Province of Alberta and Canada.

23.   Time of Essence

      Time shall be of the essence of this Agreement.

24.   No Amendment Except In Writing

      No amendment or variation of the provisions of this Agreement shall be
      binding upon any party unless it is evidenced in writing executed by the
      party.

25.   Binds Successors and Assigns

      This Agreement shall enure to the benefit of and shall bind the parties
      hereto and their respective successors and assigns, and the heirs,
      executors, administrators and assigns of natural persons who are or become
      parties hereto.

26.   Term

      This Agreement shall terminate when all title documents on the royalty
      lands or lands which become royalty lands, in which Grantor, its
      successors or assigns have an interest, expire or are surrendered.

Each party agrees that this conveyance may be executed by fax and that once
executed by fax it is binding, with both parties agreeing that original copies
will be executed as soon as possible.

      IN WITNESS WHEREOF the parties have executed this Agreement as of the day
and year first above written.

808099 ALBERTA LTD.                     STRIPPER ENERGY SERVICES LIMITED.

/s/                                     /s/ Neil K. Answorth - Director
--------------------------------        --------------------------------

--------------------------------        --------------------------------

<PAGE>

                                  SCHEDULE "A"

   Attached to and forming part of a Gross Overriding Royalty Agreement dated
 September 29, 2004 between 808099 ALBERTA LTD. as Grantor and STRIPPER ENERGY
                       SERVICES LIMITED as Royalty Owner.

                                 "royalty lands"

One Hundred (100%) percent Working Interest in the Firebag East Permits, located
in Northwest Saskatchewan, as described below:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
               Permits                                         Lands                               Encumbrances
----------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                                                    <C>
Saskatchewan Oil Shale Exploration      Twp 92, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00205                        Twp 92, Rge 23, W3M: Secs 1-36
                                        Twp 92, Rge 24, W3M: Secs 1-36 Twp 92,
                                        Rge 25, W3M: Secs 1-5, ptn6, ptn 7, secs
                                        8-17, ptn18, ptn 19, secs 20-29, ptn 30,
                                        ptn 31, secs 32-36 (containing 88,782
                                        acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 93, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00206                        Twp 93, Rge 23, W3M: Secs 1-36
                                        Twp 93, Rge 24, W3M: Secs 1-36 Twp 93,
                                        Rge 25, W3M: Secs 1-5, ptn6, ptn 7, secs
                                        8-17, ptn18, ptn 19, secs 20-29, ptn 30,
                                        ptn 31, secs 32-36 (containing 88,782
                                        acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 93, Rge 18, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00207                        Twp 93, Rge 19, W3M: Secs 1-36
                                        Twp 93, Rge 20, W3M: Secs 1-36
                                        Twp 93, Rge 21, W3M: Secs 1-36
                                        (containing 92,160 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 94, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00208                        Twp 94, Rge 23, W3M: Secs 1-36
                                        Twp 94, Rge 24, W3M: Secs 1-36 Twp 94,
                                        Rge 25, W3M: Secs 1-5, ptn6, ptn 7, secs
                                        8-17, ptn18, ptn 19, secs 20-29, ptn 30,
                                        ptn 31, secs 32-36 (containing 88,692
                                        acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 94, Rge 19, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00209                        Twp 95, Rge 19, W3M: Secs 1-36
                                        Twp 94, Rge 20, W3M: Secs 1-36
                                        Twp 94, Rge 21, W3M: Secs 1-36
                                        (containing 92,160 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 95, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00210                        Twp 95, Rge 23, W3M: Secs 1-36
                                        Twp 95, Rge 24, W3M: Secs 1-36 Twp 95,
                                        Rge 25, W3M: Secs 1-3, ptn4, ptn 9, secs
                                        10-15, ptn 16, ptn 21, secs 22-27, ptn
                                        28, ptn 33, secs 34-36.
                                        (containing 83,460 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 95, Rge 20,W3M: Secs 1-36                          Crown Lessor Royalty
Permit # PS00211                        Twp 96, Rge 20,W3M: Secs 1-36
                                        Twp 95, Rge 21,W3M: Secs 1-36
                                        Twp 96, Rge 21,W3M: Secs 1-36
                                        (containing 92,160 acres)
----------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
                                     - 11 -

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
               Permits                                         Lands                               Encumbrances
----------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                                                    <C>
Saskatchewan Oil Shale Exploration      Twp 96, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00212                        Twp 96, Rge 23, W3M: Secs 1-36
                                        Twp 96, Rge 24, W3M: Secs 1-36 Twp 96,
                                        Rge 25, W3M: Secs 1-3, ptn4, ptn 9, secs
                                        10-15, ptn 16, ptn 21, secs 22-27, ptn
                                        28, ptn 33, secs 34-36.
                                        (containing 83,432 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 97, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00213                        Twp 97, Rge 23, W3M: Secs 1-36
                                        Twp 97, Rge 24, W3M: Secs 1-36 Twp 97,
                                        Rge 25, W3M: Secs 1-3, ptn4, ptn 9, secs
                                        10-15, ptn 16, ptn 21, secs 22-27, ptn
                                        28, ptn 33, secs 34-36.
                                        (containing 83,360 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 97, Rge 21, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00214                        Twp 98, Rge 21, W3M: Secs 1-36
                                        Twp 99, Rge 21, W3M: Secs 1-36
                                        Twp 100, Rge 21, W3M: Secs 1-36
                                        (containing 92,160 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 98, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00215                        Twp 98, Rge 23, W3M: Secs 1-36
                                        Twp 98, Rge 24, W3M: Secs 1-36 Twp 98,
                                        Rge 25, W3M: Secs 1-3, ptn4, ptn 9, secs
                                        10-15, ptn 16, ptn 21, secs 22-27, ptn
                                        28, ptn 33, secs 34-36.
                                        (containing 83,340 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 99, Rge 22, W3M: Secs 1-36                         Crown Lessor Royalty
Permit # PS00216                        Twp 99, Rge 23, W3M: Secs 1-36
                                        Twp 99, Rge 24, W3M: Secs 1-36 Twp 99,
                                        Rge 25, W3M: Secs 1-2, ptn 3, ptn 10,
                                        secs 11-14, ptn 15, ptn 22, secs 23-26,
                                        ptn 27, ptn 34, secs 35-36 (containing
                                        78,006 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 100, Rge 22, W3M: Secs 1-12                        Crown Lessor Royalty
Permit # PS00217                        Twp 100, Rge 22, W3M: Secs 14-36
                                        Twp 100, Rge 23, W3M: Secs 1-36 Twp 100,
                                        Rge 24, W3M: Secs 1-36 Twp 100, Rge 25,
                                        W3M: Secs 1-2, ptn 3, ptn 10, secs
                                        11-14, ptn 15, ptn 22, secs 23-26, ptn
                                        27, ptn 34, secs 35-36 (containing
                                        78,360 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 101, Rge 22, W3M: Secs 1-36                        Crown Lessor Royalty
Permit # PS00218                        Twp 101, Rge 23, W3M: Secs 1-36
                                        Twp 101, Rge 24, W3M: Secs 1-36 Twp 101,
                                        Rge 25, W3M: Secs 1-2, ptn 3, ptn 10,
                                        secs 11-14, ptn 15, ptn 22, secs 23-26,
                                        ptn 27, ptn 34, secs 35-36 (containing
                                        77,958 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 102, Rge 22, W3M: Secs 1-36                        Crown Lessor Royalty
Permit # PS00219                        Twp 102, Rge 23, W3M: Secs 3-10, 15-22, 25, 27-34,
                                        36
                                        Twp 102, Rge 24, W3M: Secs 1-36 Twp 102,
                                        Rge 25, W3M: Secs 1-2, ptn 3, ptn 10,
                                        secs 11-14, ptn 15, ptn 22, secs 23-26,
                                        ptn 27, ptn 34, secs 35-36 (containing
                                        71,552 acres)
----------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
                                     - 12 -

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
               Permits                                         Lands                               Encumbrances
----------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                                                    <C>
Saskatchewan Oil Shale Exploration      Twp 101, Rge 21, W3M: Secs 1-36                        Crown Lessor Royalty
Permit # PS00220                        Twp 102, Rge 21, W3M: Secs 1-36
                                        Twp 103, Rge 21, W3M: Secs 1-36
                                        (containing 69,120 acres)
----------------------------------------------------------------------------------------------------------------------
Saskatchewan Oil Shale Exploration      Twp 103, Rge 22, W3M: Secs 1-36                        Crown Lessor Royalty
Permit # PS00221                        Twp 103, Rge 23, W3M: Secs 14-36
                                        Twp 103, Rge 24, W3M: Secs 1-20,23-26,
                                        29-32, 35, 36 Twp 103, Rge 25, W3M: Ptn
                                        1, ptn 12, ptn 13, ptn 24, ptn 25, ptn
                                        36.
                                        (containing 68,754 acres)
----------------------------------------------------------------------------------------------------------------------
</TABLE>

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00072-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00072-of-00352.parquet"}]]