Document:

Exhibit 10.1

                          JOINT PARTICIPATION AGREEMENT
                               BLACKWATER PROSPECT

                             GREEN CANYON BLOCK 246

                             CENTRAL GULF OF MEXICO

This Joint Participation Agreement ("Agreement") effective this 14th day of
July, 2006 will serve as the definitive agreement between Marathon Oil Company
("MOC"), Woodside Energy (USA) Inc. ("WEI") and Ridgewood Energy Corporation
("Ridgewood"), sometimes hereinafter referred to collectively as "Parties" and
individually as "Party", concerning the drilling and evaluation of the
Blackwater Prospect as more fully described herein.

WHEREAS, MOC and WEI represent they currently own an undivided one hundred
percent of six-sixths (100% of 6/6ths) record title interest in the Outer
Continental Shelf Lease OCS-G 16716, covering Green Canyon Block 246. The
aforementioned Lease shall hereinafter sometimes be referred to as "GC 246" and
is more fully described on Exhibit "A" attached hereto; and,

WHEREAS, MOC and WEI desire to make available to Ridgewood a collective and
undivided thirty-five-percent (35%) operating rights interest in GC 246 from the
surface down to 20,000' TVD ("Shallow Rights"); and, a collective and undivided
ten percent (10%) operating rights interest in all depths below the Shallow
Rights down to a depth of 99,999' TVD ("Deep Rights") in GC 246; and

WHEREAS, Ridgewood desires to earn from MOC and WEI the aforementioned Shallow
Rights and Deep Rights by participating in and bearing a disproportionate share
of the cost of the GC 246 #1 well (hereinafter referred to as the "IBW"); and

WHEREAS, the Parties desire to make the Shallow Rights and Deep Rights subject
to two distinct and separate Joint Operating Agreements hereinafter referred to
as the Shallow Rights OA and Deep Rights OA, respectively; and

WHEREAS, MOC and WEI have negotiated with Hess Corporation ("Hess") for Hess to
release the 4th slot on the Diamond Ocean Voyager Rig ("Voyager") to enable MOC
to enter into a drilling contract with Diamond Offshore to utilize said 4th slot
to drill the IBW. In consideration for Hess releasing the 4th slot back to
Diamond, MOC and WEI will assign to Hess an undivided thirty percent (30%)
operating rights interest in the Deep Rights subject to the Deep Rights OA.

NOW, THEREFORE, in consideration of the mutual promises and covenants made
herein, the Parties agree to the following terms and conditions:

     1.   MOC, as Operator, has entered into that certain contract dated July
          14, 2006, by and between Marathon Oil Company and Diamond Offshore
          under the terms of which MOC shall utilize the Voyager  to drill the

                                  Page 1 of 10

<PAGE>

          IBW which is anticipated to commence on or about August 10, 2006. Once
          commenced, MOC agrees to prosecute the drilling of the IBW in a good
          and workmanlike manner until the IBW reaches Objective Depth as set
          forth in the AFE and Well Plan (attached hereto as Exhibit "B"). The
          IBW shall be drilled pursuant to the terms of this Agreement, the AFE
          and Well Plan and the Shallow Rights OA (attached hereto as Exhibit
          "C"). In the event there is a conflict between this Agreement and the
          Shallow Rights OA, this Agreement shall prevail.

     2.   Concurrent with the execution of this Agreement, the Parties shall
          separately execute the attached Exhibit "B", AFE and Well Plan, and
          shall be obligated to pay the gross actual costs incurred for the IBW
          in the following promoted working interest percentages:

                          MOC-23.335%;
                          WEI-16.665%
                          Ridgewood-60.00%

          until the IBW has been drilled to the Objective Depth and has been
          tested, logged and evaluated as set forth in the AFE and Well Plan. At
          such time as the IBW has been drilled to Objective Depth, tested,
          logged and evaluated or the gross actual well costs of the IBW reach
          $38.5MM ("Promote Cap"), whichever occurs first, Ridgewood's
          disproportionate spending shall cease. Thereafter all further cost,
          risk and expense of the operations for the IBW or any subsequent
          operations proposed including sidetrack of the IBW shall be allocated
          and paid on a nonpromoted basis in the following working interest
          percentages:

                          MOC-40.0025%;
                          WEI-24.9975%
                          Ridgewood-35.00%

          Notwithstanding the above in the event that the Objective Depth is
          reached prior to the gross actual well costs reaching the Promote Cap,
          and the Parties agree to either temporarily or permanently plug and
          abandon the well, the Parties will pay the costs associated with
          either operation on the promoted working interest percentages stated
          above until the gross actual well cost reaches the Promote Cap at
          which point the remaining costs to either temporarily or permanently
          plug and abandon the well shall be paid on the non-promoted working
          interest percentages.

     3.   At the earlier of either the IBW reaching Objective Depth and being
          evaluated as described in the AFE and Well Plan, or the gross actual
          well costs reach $42.6MM, Ridgewood shall have earned and be entitled
          to an Assignment of Operating Rights ("Assignment") from MOC and WEI
          covering:

               1)   The Shallow Rights (to be assigned in the proportions of
                    26.6675% of 8/8ths from MOC and 8.3325% of 8/8ths from WEI);
                    and

                                  Page 2 of 10

<PAGE>

               2)   The Deep Rights (to be assigned in the proportions of 6.667%
                    of 8/8ths from MOC and 3.333% of 8/8ths from WEI).

          The Assignments in the Shallow Rights and the Deep Rights shall be
          delivered to Ridgewood no later than thirty (30) days after the
          release of the drilling rig from the IBW or any substitute well. Said
          Assignments will be made free and clear of any burdens, liens, or
          encumbrances, and shall be subject only to (i) this Agreement, (ii)
          the terms and conditions of GC 246, and (iii) the applicable Shallow
          Rights OA or Deep Rights OA. The Assignments shall be substantially in
          the form attached hereto as Exhibit "D".

     4.   a) At such time as Ridgewood earns a Shallow Rights Assignment
          pursuant to the terms of this Agreement, the working interest
          percentages of the Parties in the shallow horizons and all further
          operations involving the IBW and Shallow Rights shall be governed by
          the Shallow Rights OA. The Shallow Rights working interest shall be:

                          Marathon -        40.0025%
                          Woodside --       24.9975%
                          Ridgewood --      35.0000%

     b)   At such time as Ridgewood earns a Deep Rights Assignment pursuant to
          the terms of this Agreement, the working interest percentages of the
          Parties in the deep horizons and all operations involving the Deep
          Rights shall be governed by the Deep Rights OA, in the form of the
          Shallow Rights OA revised to reflect depth limitations and ownership.
          The Deep Rights working interest shall be:

                          Marathon -        40.002%
                          Woodside -        19.998%
                          Ridgewood -       10.000%
                          Hess              30.000%

          Once the IBW reaches Objective Depth and is evaluated as described in
          the AFE and Well Plan, Operator shall make a proposal, pursuant to the
          Shallow Rights OA, to conduct subsequent operations on the well in
          accordance with the Shallow Rights OA.

     5.   Contemporaneously with the execution of any Assignment of interest
          pursuant to the terms of this Agreement, the Parties agree to execute
          a Ratification of the Shallow Rights OA with a revised Exhibit "A"
          attached thereto; and a Ratification of the Deep Rights OA with a
          revised Exhibit "A" attached thereto, respectively.

     6.   In the event that, prior to reaching Objective Depth, the IBW should
          encounter shallow water flows, impenetrable substances, mechanical
          difficulties, pressurized shale or any other condition which renders
          further drilling impracticable and which cannot be overcome by
          reasonable and prudent operations, then and in such event MOC and/or

                                  Page 3 of 10

<PAGE>

          WEI shall have the option for thirty (30) days following abandonment
          of the IBW to propose the drilling of a substitute well to be located
          and drilled in such a manner so as to achieve the same exploratory
          results as the IBW. If MOC and WEI mutually agree to drill a
          substitute well the substitute well shall be drilled. If either MOC or
          WEI elects not to participate in a substitute well, the substitute
          well shall be drilled, only if MOC or WEI agrees to assume the
          combined working interest of MOC and WEI and agrees to pay one hundred
          percent (100%) of the cost and expense of the combined working
          interest in the substitute well. The right to drill a substitute
          well(s) shall be ongoing so long as the previous well does not reach
          Objective Depth and each substitute well is proposed within thirty
          (30) days of abandonment of the previous well. If such substitute well
          is timely commenced in accordance with the Shallow Rights OA, then
          this Agreement shall not terminate but shall remain in full force and
          effect as though the substitute well was the IBW. However, all costs
          incurred in connection with the IBW will be carried over and added to
          the cost on any substitute well(s) to calculate when the Promote Cap
          is reached.

     7.   WEI shall have the right to continue to market additional interest in
          GC 246 to third parties. In the event an agreement is entered into
          with a third party prior to the earlier of the temporary abandonment
          or permanent abandonment of the IBW, or any substitute therefore, any
          well cost reduction realized by said agreement shall be deducted
          solely from the net cost basis of WEI, up to a maximum 16.665% of the
          gross well cost in the IBW well. Thereafter, any additional well cost
          reduction shall accrue to the benefit of MOC at its sole discretion.
          MOC and WEI shall each be solely responsible for the lease interest
          earned by the third party associated with their applicable well cost
          reductions. The Parties agree that, until the earlier of the temporary
          or permanent abandonment of the IBW, WEI shall have a waiver of
          Article 24.1.1 (Consent to Assignment), Article 24.1.4. (Minimum
          Transfer of Working Interest), and Article 24.2 (Preferential Right to
          Purchase) of the Shallow Rights OA and the Deep Rights OA as to the
          possible sale of a portion of its rights in GC 246; provided that if
          Deep Rights are included in any such sale, WEI shall sell a minimum of
          a five percent (5%) interest in such Deep Rights.

          The Parties agree MOC, WEI, and Hess shall each have the separate
          right to market additional interest in the Deep Rights on GC 246 to
          third parties. The Parties agree that, until the earlier of the
          temporary or permanent abandonment of the initial exploratory well to
          test the Deep Rights, MOC, WEI and Hess shall have a waiver of Article
          24.1.1 (Consent to Assignment), and Article 24.1.4 (Minimum Transfer
          of Working Interest) of the Deep Rights OA; provided that any such
          sale shall be a minimum of five percent (5%) interest in such Deep
          Rights.

     8.   The Parties acknowledge that there will be two separate operating
          agreements governing the two different ownership groups in the
          horizons above and below 20,000'TVD. The Parties agree to use best
          efforts and accepted practices in the development of the shallow

                                  Page 4 of 10

<PAGE>

          and deep horizons so as not to interfere with the respective
          operations for each horizon if possible.

     9.   The Parties acknowledge and agree that pursuant to NTL No. 2006-G10,
          Interim Guidelines for Moored Drilling Rig Fitness Requirements for
          the 2006 Hurricane Season, effective May 19, 2006, in the event the
          additional mooring components (anchors, chains and wires) for the
          Voyager become available at any time during the drilling of the IBW
          all Parties will pay their proportionate share of the costs for the
          installation of same. The cost of installation, estimated to be $4MM,
          shall be shared in the percentages of MOC-40.0025%, WEI-24.9975% and
          Ridgewood-35% and will be in addition to the attached AFE and will not
          be included in calculating the supplemental AFE cost overrun of the
          well under the Shallow Rights OA.

     10.  Each Party has had the benefit of independent representation with
          respect to the subject matter of this Agreement. This Agreement,
          though drawn by one Party, shall be construed fairly and reasonably
          and not more strictly against one Party than another. MOC and WEI make
          no representations or warranties, express or implied, as to the volume
          of reserves, if any, present on the Lease referred to herein or the
          ability of said Lease to produce as a result of operations
          contemplated hereunder.

     11.  This Agreement, and the exhibits attached and incorporated herein,
          contain the final and entire agreement of the Parties with respect to
          the subject matter of this contract. There are no representations,
          warranties or promises, oral or written between the Parties other than
          those included in this Agreement. Upon execution of this Agreement by
          each of the Parties, this Agreement shall supersede and replace all
          previous negotiations, understandings, or promises, whether written or
          oral, relative to the subject of this Agreement. Each of the Parties
          acknowledges that no Party has made any promise, representation or
          warranty that is not expressly stated in this Agreement. This
          Agreement shall not be modified or changed except by written amendment
          signed by each of the Parties.

     12.  If any Party is a legal entity, including but not limited to, an
          association, corporation, joint venture, limited partnership,
          partnership, LLC, or trust, such Party represents to the other Parties
          that the execution and delivery of this Agreement and the completion
          of transactions contemplated herein have been duly authorized by all
          necessary corporate proceedings and such Party has received all
          necessary management approvals.

     13.  This Agreement may be executed by signing the original or a
          counterpart hereof. If this Agreement is executed in multiple
          counterparts, each counterpart shall be deemed an original and all of
          which, when taken together, shall constitute but one and the same
          Agreement with the same effect as if all Parties had signed the same
          instrument. In the event this Agreement is circulated or executed via
          facsimile, the signatures of the Parties shall be deemed original
          and self-providing for all purposes under applicable law.

                                  Page 5 of 10

<PAGE>

     14.  This Agreement shall be binding upon and inure to the benefit of the
          Parties and their respective successors and assigns, if permitted, and
          shall constitute a covenant running with the land and the Lease
          referred to herein. This Agreement does not benefit or create any
          rights in any person or entity not a Party to this Agreement unless
          specifically granted by a Party hereto pursuant to the terms contained
          herein.

     15.  The Parties agree to comply with all applicable laws, ordinances,
          governmental rules, regulations and orders in connection with the
          Lease referred to herein and in performing their obligations and
          duties hereunder, including, without limitation, those pertaining to
          pollution control, environmental protection, securities laws and
          regulations, the Fair Labor Standards Act and the Occupational Safety
          and Health Act (as all of same may hereafter be amended). The Parties
          shall also, unless exempt, comply with Executive Order 11246 (Equal
          Employment Opportunity) effective October 24, 1965, together with all
          relevant governmental rules, regulations and orders promulgated
          pursuant thereto. The Parties agree that all provisions of said laws,
          ordinances, rules, regulations and orders, as applicable to the
          transactions contemplated in this Agreement, are deemed incorporated
          herein by reference.

     16.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
          THE SUBSTANTIVE LAWS OF THE STATE OF TEXAS EXCLUSIVE OF ANY PROVISIONS
          THAT WOULD DIRECT THE APPLICATION OF THE SUBSTANTIVE LAW OF ANY OTHER
          JURISDICTION.

     17.  MOC and WEI agree to protect, defend, indemnify, and hold Ridgewood
          and its affiliates and its officers, directors, agents, servants, and
          employees (collectively "Indemnitees"), harmless from and against any
          and all claims, demands, costs, losses, expenses (including without
          limitation, court costs and attorneys fees), penalties, suits and
          judgments of any nature whatsoever (collectively "Claims") resulting
          directly or indirectly from or arising out of or in connection with
          MOC's and WEI's ownership and/or operatorship of the Lease prior to
          the effective date of this Agreement, to the fullest extent which the
          law will allow, WHETHER CAUSED IN WHOLE OR IN PART BY THE SOLE, JOINT,
          OR CONCURRENT, ACTIVE OR PASSIVE, NEGLIGENCE, STRICT LIABILITY OR
          OTHER FAULT OF THE ABOVE DESCRIBED INDEMNITEE (EXCEPTING ONLY THOSE
          CLAIMS CAUSED BY THE INDEMNITEE'S GROSS NEGLIGENCE OR WILLFUL
          MISCONDUCT) OR THE UNSEAWORTHINESS OF ANY VESSEL OR UNAIRWORTHINESS OF
          ANY AIRCRAFT.

                                  Page 6 of 10

<PAGE>

     18.  All notices, requests or demands to be given under this Agreement
          shall be in writing and shall be deemed to have been given (i) three
          (3) business days after being sent by registered mail or certified
          mail, postage prepaid, or (ii) on the day sent, if hand delivered or
          sent by facsimile, with receipt confirmed and verbal confirmation, in
          each case addressed as follows or to such other address as may have
          been furnished in writing to the other Parties hereto in accordance
          with this Section:

          If to MOC:                              If to Ridgewood:
          ---------                               ----------------
          Marathon Oil Company                    Ridgewood Energy Corporation
          P.O. Box 3128 (Mail) 77253              11700 Katy Freeway
          5555 San Felipe                         Suite 280
          Houston, TX 77056                       Houston, Texas 77079
          Attention: Mr. M. J. Koenig             Attention: Mr. W. Greg Tabor
          Office Phone: (713) 629-6600            Office Phone: (281) 293-8449
          Direct: (713) 296-3402                  Fax No.: (281) 293-7705
          Fax No.: (713) 296-4209

          If to WEI:
          -----------
          Woodside Energy (USA) Inc.
          5151 San Felipe, Suite 1200
          Houston, TX 77056
          Attention: Mr. Brad L. Dowdell
          Office Phone: (713) 401-0000
          Direct: (713) 401-0014
          Fax No.: (713) 963-8868

     19.  Each of the Parties hereto shall timely execute, acknowledge and
          deliver to the other such further documents and take such other
          action, as may be reasonably requested in order to carry out the
          purposes of this Agreement.

     20.  Notwithstanding any provisions in this Agreement to the effect that
          the rights and liabilities of the Parties are several and limited to
          each Parties' percentage working interest during the relevant period
          (whether promoted or non-promoted working interest percentages) and
          not joint nor joint and collective, for United States federal income
          tax purposes, the Parties elect not to be excluded from the
          application of subchapter K of Chapter 1, Subtitle A, of the Internal
          Revenue Code of 1986, as amended, and similar provisions of applicable
          state laws. The tax partnership created hereunder shall be governed by
          the Tax Partnership Provisions attached hereto as Exhibit "E".

     21.  Ridgewood covenants and agrees that it shall not transfer or assign
          all or any portion of its rights and/or obligations under this
          Agreement without the written consent of MOC and WEI, which consent
          will not be unreasonably withheld. Any such assignment made without

                                  Page 7 of 10

<PAGE>

          such written consent shall be null and void. No permitted assignment
          of the Agreement or any interest herein shall release Ridgewood from
          any liability or duty assumed hereunder or obligation accrued before
          such assignment without the express written agreement of MOC and WEI.
          Notwithstanding the above, MOC and WEI agree and acknowledge that
          Ridgewood may assign all or a portion of its rights and/or obligations
          under this Agreement, and/or any interest earned hereunder to a
          Ridgewood Energy drilling fund or fund(s) without the written consent
          of MOC and WEI.

          22.  Ridgewood shall not make any releases or disclosures to any third
               party with respect to the matters herein, including the existence
               of this Agreement, without the prior written consent of MOC and
               WEI. However, Ridgewood may make releases or public announcements
               which are required in order to ,comply with applicable laws, and
               Ridgewood may release information regarding the basic terms of
               this transaction to prospective investors for its drill fund
               marketing efforts prior to the drilling of the IBW.

          23.  If any term or provision of this Agreement is held to be invalid,
               illegal, or unenforceable by any rule of law or public policy,
               all other conditions and provisions of the Agreement shall,
               nevertheless, remain in full force and effect.

          24.  This Agreement shall remain in full force and effect until all of
               the obligations hereunder have been fulfilled or have expired
               unless otherwise agreed by the Parties, except with respect to
               any indemnities which shall survive termination of this
               Agreement.

IN WITNESS WHEREOF, this Agreement is executed in the presence of competent
witnesses by the Parties to this Agreement as of the dates set out below, but is
made effective as of the date first above written.

WITNESSES:                              Marathon Oil Company

(SIGNATURE ILLEGIBLE)                   By:    /S/ M.J. Koenig
---------------------                          -----------------
(SIGNATURE ILLEGIBLE)                   Name:  M. J. Koenig
---------------------                          -----------------
                                        Title: Attorney-in-Fact
                                        Date:  July 27, 2006

WITNESSES:                              Woodside Energy (USA) Inc.

---------------------                   By:
                                               ------------------
---------------------                   Name:
                                               ------------------
                                        Title:
                                               ------------------
                                        Date:

                                  Page 8 of 10

<PAGE>

WITNESSES:                              Ridgewood Energy Corporation

Randy Bennett                           By:    /s/ W. Greg Tabor
---------------------                          -----------------
                                        Name:  W. Greg Tabor
                                        Title: Executive Vice President
                                        Date:  8-2-06

     SIGNATURE PAGE TO THAT CERTAIN JOINT PARTICIPATION AGREEMENT EFFECTIVE JULY
     14, 2006, BY AND AMONG MARATHON OIL COMPANY, WOODSIDE ENERGY (USA) INC. AND
     RIDGEWOOD ENERGY CORPORATION

     L:Blackwater:JPA MOC WEE Ridgewod Final 072606.doc

                                  Page 9 of 10

<PAGE>

                                 ACKNOWLEDGEMENT
                                 ---------------

STATE OF TEXAS:
COUNTY OF HARRIS:

On this 27th day of July 2006, before me, appeared M. J. Koenig, to me
personally known, who, being by me duly sworn, did say that he is the
Attorney-in-Fact for Marathon Oil Company, and that the foregoing instrument was
signed on behalf of said corporation by authority of its Board of Directors, and
said appearer acknowledged said instrument to be the free act and deed of said
corporation.

                                                           /s/ Deborah A. Reeder
                                                           ---------------------
                                                               NOTARY PUBLIC
My Commission expires: 1-22-2010
                      ----------

                                 ACKNOWLEDGEMENT       [SEAL]
                                 ---------------

STATE OF TEXAS:
COUNTY OF HARRIS:

On this 2nd day of Aug 2006, before me, appeared W. Greg Tabor, to me
personally known who, being by me duly sworn, did say the he is the Exec Vice
President of Ridgewood Energy Corporation, and that the foregoing instrument was
signed on behalf of said corporation by authority of its Board of Directors, and
said appearer acknowledged said instrument to be the free act and deed of said
corporation.

                                                           /s/ Donna Ermis
                                                           ---------------
                                                           NOTARY PUBLIC
My Commission expires: 10/1/08

                                 ACKNOWLEDGEMENT       [SEAL]
                                 ---------------

STATE OF___________:
________ OF _______:

On this ______ day of ________________  2006, before me, appeared did say that
she/he is the _________________________ for Woodside Energy (USA) Inc, and that
the foregoing instrument was signed on behalf of said corporation by authority
of its Board of Directors, and said appeared acknowledged said instrument to be
the free act and deed of said corporation.

                                                           -------------
                                                           NOTARY PUBLIC
My Commission expires: _________________

                                  Page 10 of 10

<PAGE>

                                   EXHIBIT "A"

Attached to and made a part of that certain Joint Participation Agreement
effective July 14, 2006 by and between Marathon Oil Company, Woodside Energy
(USA) Inc. and Ridgewood Energy Corporation.

                              DESCRIPTION OF LEASE
                              --------------------

I.   Blackwater Prospect Oil and Gas Lease

     Federal Lease No. OCS-G 16716, effective September 1, 1996 covering all of
     Block 246, Green Canyon, OCS Official Protraction Diagram, NG 15-3,
     containing approximately 5760.00 acres.Exhibit 10.2

[LOGO] Ridgewood Energy                                 W. Greg Tabor
                                                        Executive Vice President

May 24, 2006

Nexen Petroleum Offshore U.S.A. Inc.
12790 merit Drive, Suite 800
Dallas, Texas 75251

Attention: Mr. Steve McMillan

Re:  Offer to Participate - West Cameron 109 Prospect
     West Cameron Black 109, OCS-G 23744
     West Cameron Area, Offshore Louisiana

Gentlemen:

Nexen Petroleum Offshore U.S.A. ("Nexen") Is marketing a certain exploration
prospect ("WC 109") in the West Cameron Area offshore Louisiana which it has
generated and made available to Ridgewood Energy Corporation ("REC") as further
described below. Nexen is desirous of selling participation percentages in WC
109 and REC desires to take a specified level of participation in WC 109. REC
hereby submits below the terms and conditions of a participation proposal to
earn a specified working interest and net revenue interest in the prospect area
and respective blocks, as follows:

          West Cameron 109 Prospect Area:
          -------------------------------

          West Cameron Block(s): 109

          Nexen Ownership; 100% WI in block

          Depth Limitation/ Restriction; none;

          REC Level of Participation:
          ---------------------------

          Before Casing Point ("BCP interest) = 60% WI (of 8/8ths);
          After Casing Point ("ACP Interest") = 45% WI (of 8/8ths);

              11700 Old Katy Road, Suite 280, Houston, TX 77079 o
                         T:(281)293-8449 F:(281)293 7705
               gtabor@ridgewoodenergy.com o www.ridgewoodenergy.com

<PAGE>

          Lease Burdens: 16.667% Royalty

          Overriding Royalty Burden: 2.50% (proportionately reduced)

          Lease Net Revenue: 80.833%

REC's offer to commit participation towards the drilling of WC 109 is subject to
the following terms and conditions:

     1.   REC's commitment to participate is based upon Nexen's representation
          as to its working interest and net revenue interest ownership in the
          prospect area block(s), as described above (Nexen will provide "by,
          through and under" warranty in the participation agreement mentioned
          below in paragraph 4).

     2.   REC shall pay its ACP 45% share of Nexen's WC 109 sunk costs in the
          amount of $159,750.00 within 15 days of formal execution of the
          Participation and Operating agreements as described below. Upon said
          payment of sunk costs Nexen shall deliver to REC an assignment of 45%
          record title interest covering all depths in the entirety of W.
          Cameron Block 109, OCS-G23744.

     3.   REC shall pay a disproportionate cost share of 60% BCP Interest in the
          W C 109 initial exploratory well until one of the following occurs: 1)
          initial exploratory well reaches objective depth, or 2) the well cost,
          prior to the well reaching objective depth reaches 115% of the
          estimated $19,242,579 dollars DHC AFE ie. total cost of $22,128,966
          dollars whichever occurs first. Thereafter, REC's cost bearing
          interest in the initial exploratory well, and/or any subsequent
          well(s) In the Prospect Area will be at its ACP Interest of 45%.

     4.   Upon Nexen's acceptance of this offer, REC and Nexen shall proceed
          diligently and in good faith to negotiate a separate formal and
          definitive Participation Agreement that includes a formal DHC AFE
          depicting the total Dry Hole Cost as set forth in 3. above and
          Operating Agreement, with terms and conditions as are mutually
          satisfactory to both parties, within 45 days of acceptance of this
          offer to participate.

     5.   Upon Nexen's acceptance of this offer, Nexen commits (subject to
          paragraph 4 above) to REC to spud WC 109 on or before August 30, 2006,
          subject to delays caused by force majeure events or other events
          beyond the reasonable control of Nexen and will utilize the Ensco 105
          rig to drill WC 109 at the contracted rig rate of $140,000 / day
          subject to rig delay/availability.

<PAGE>

     6.   Nexen shall provide REC with full and complete access to Nexen's
          files, records and data, so that REC may perform its due diligence
          review of Nexen's acquisition, ownership and obligations associated
          with the lease block(s); additionally, Nexen shall provide REC with
          access to technical data associated with the exploration prospect(s),
          including seismic, maps, well data and geologic data, subject however,
          to all confidentiality and license restrictions.

The foregoing proposal expresses the intent of REC to participate in the
specified WC 109 Prospect subject to the terms and conditions stated herein.

Should you wish to accept this offer and the foregoing terms and conditions are
acceptable to you, please execute two copies of this letter and return one copy
by fax to; 281/293-7391; and one original to my attention at the letterhead
address. Should you have any questions regarding this offer, please contact
Randy Bennett at (281) 293-9384 or the undersigned at (281) 293-8449.

This offer to participate shall remain open for Nexen's consideration until the
end of business, or 5:00 pm. on Friday, June 2, 2006, after which such time this
offer, if not accepted by Nexen, shall have expired and become null and void.

Very truly yours,

/s/ W. G. Tabor
W. Greg Tabor, CPL
Executive Vice President

AGREED TO AND ACCEPTED THIS 1ST  DAY OF JUNE, 2006.

/s/ John M. Glynn
-----------------------
BY: John M. Glynn
-----------------------
TITLE: VP - Production
-----------------------

<PAGE>

                                                                        [LOGO]
                                                                        nexen

                                  WEST CAMERON
                                    Block 109

                                PROSPECT SUMMARY

Nexen Petroleum Offshore U.S.A. Inc offers an opportunity to
participate in the third quarter drilling of the Nexen OCS G-23744 #1
well under the following terms:

o    Available Interest: Up to 45% of 8/8ths record title interest

o    Unpromoted Costs:   Reimbursement of proportionate share of sunk costs -
     $355,000 as to 8/8ths

o    Promoted Costs:     Disproportionate share of Initial Test Well costs;
     one-third for a quarter basis

o    Prior to a formal technical review, prospective participant shall execute a
     confidentiality agreement

o    Participant shall enter into a participation agreement and JOA with Nexen

o    Participant shall pay its proportionate share of Nexen's sunk costs within
     fifteen days of execution of a definitive participation agreement

<TABLE>
 -------------------------------------------------------------------------------------------------------

 NAME                        OCS G-23744 #1           INFRASTRUTURE           Numerous Options
<S>                            <C>                    <C>                      <C>

 OCS No.                     G-23744                  GROSS G&G                $0.00

 LOCATION                    West Cameron 109         GROSS ACRES              5000

 DISTANCE TO SHORE           34 +/- Miles             NET ACRES                5000

 WATER DEPTH                 43 Ft.                   OPERATOR                 Nexen Petroleum U.S.A. Inc.

 LEASE SALE No.              182                      NEXEN W.I.               90%

 LEASE SALE DATE             3/20/2002                ROYALTY                  16.667% of 8/8ths

 EFFECTIVE DATE              5/01/2002                OVERRIDE                 2.50% of 8/8ths

 EXPIRATION DATE             5/01/2007                NEXEN N.R.I.             80.833% of 8/8ths

 GROSS LEASE COSTS           $355,000                 PARTNERS                 Mako Offshore Explor. 10%
</TABLE>

<PAGE>
                                                                          [LOGO]
                                                                          nexen

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

          TARGET                        LWR. Miocene, Marg A

          PROPOSED DEPTH                17,527' MD - 16,517' TVD

          COST ESTIMATE (DHC)           $19 MM (High Island IV rig)

          RESERVE POTENTIAL             Up to 134 BCF
                                        Down-thrown structural/strat on 3
                                        way closure with
          TRAP                          Amplitude

                                        SEI, 40 fold w/6,000 meter offset
          SEISMIC VOLUMES               1998 Fairfield, 60 fold w/20,000 offset

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

                               GEOLOGICAL SUMMARY

This is an amplitude prospect; hence, there is a stratigraphic component.
Structurally, the prospect is a down-thrown Marg. A amplitude, and it is the
number one drill location on this block. The closure is in the southern portion
of the block, down-thrown on an East-West semi-regional fault that provides
charge and migration. It is also down-thrown on a splinter fault that separates
it from the Mobil #2 well in Block 108, where the objective sand is shaled
and/or faulted out of the well and lacking amplitude. The amplitude can be seen
on both the SEI and Fairfield data sets, and NXY does have conditioned gathers
on the later.

The depositional setting here is transitional from shelf margin to upper slope.
Being at the upper slope, sand quality and quantity are definitely more of a
risk. The prospect is proximal to recent Marg. A discoveries: WC 100 (3-5 miles
north), WC 112 (6-9 miles west), and WC 73 (6-9 miles north). There are other
follow-up amplitude opportunities on the block should this well prove to be
productive.

                                   DISCLAIMER

Nexen makes no warranty, either expressed or implied as to the accuracy of
completeness of the data shown, or as to the amount of reserves or ability of
the property to produce. This information is provided as a matter of convenience
and any reliance on or use of such information is at recipient's sole risk. This
prospect is subject to prior sale or withdrawal by Nexen at any time. Nexen
reserves the right to reject any and all offers. Additionally, any transaction
relative to this matter would be subject to final management approval and a
fully termed, mutually agreeable formal agreement.

For more information, contact:          Steven McMillan
                                        Nexen Petroleum Offshore U.S.A. Inc.
                                        12790 Merit Drive, Suite 800
                                        Dallas, Texas 75251
                                        972/450-4672
                                        Email: steve_mcmillan@nexeninc.com

<PAGE>

                             PARTICIPATION AGREEMENT
                             -----------------------

                            WEST CAMERON 109 PROSPECT

     This Participation Agreement ("Agreement") is entered into and is effective
as of the 1st day of June, 2006 (the "Effective Date"), by and between Nexen
Petroleum Offshore U.S.A. Inc. ("Nexen") whose address is 12790 Merit Drive,
Suite 800, Dallas, TX 75251 and Ridgewood Energy Corporation ("Ridgewood"),
whose address is 11700 Old Katy Road, Suite 280, Houston, Texas 77079. Nexen and
Ridgewood are sometimes hereinafter referred to as "Party" or collectively as
"Parties", as the context requires.

                                   WITNESSETH:

WHEREAS, Nexen currently owns one-hundred percent of eight-eighths (100% of
8/8ths) of the record title interest in and to, the following Oil and Gas Lease
(hereinafter collectively referred to as the "Nexen Lease"):

          Oil and Gas Lease bearing Serial No. OCS-G 23744, effective May 1,
          2002, by and between the United States of America, as Lessor, and
          Nexen Petroleum Offshore U.S.A. Inc., as Lessee, covering all of Block
          109, West Cameron Area, OCS Leasing Map, Louisiana Map No. 1,
          containing 5,000 acres more or less; and

          NOW, THEREFORE, for and in consideration of the sum of Ten Dollars
          ($10.00) and other good and valuable consideration, the receipt and
          sufficiency of which are hereby acknowledged and confessed, together
          with the mutual covenants, conditions, and obligations contained
          herein, Nexen and Ridgewood do hereby agree to enter into this
          Agreement under the following terms and conditions:

                                    ARTICLE 1
                                    ---------
                                   DEFINITIONS
                                   -----------

1.1  AFE: shall mean the Authorization for Expenditure for the OCS-G 23744 (West
Cameron 109) Well No. 1, attached hereto as Exhibit "C-1".

1.2  Well Plan: shall mean the well plan for the ITW, attached hereto as Exhibit
"C-2"

1.3  Initial Test Well ("ITW"): shall mean the OCS-G 23744 (West Cameron 109)
Well No. 1, or its Substitute Well(s), as defined in Section 3.3 below, to be
drilled in the Nexen Lease to the Objective Depth as set forth in the AFE and
Well Plan for said ITW.

1.4  Objective Depth: the objective depth in the ITW for the purposes of this
Participation

WC 109 Participation Agreement 6/1/06

                                       1
<PAGE>

Agreement is defined as the depth at which the well encounters and sufficiently
tests the Marg "A" sand, subsurface objective interval, defined as 16,517 feet
total vertical depth as described in the AFE and Well Plan identified in
Articles 1.1 and 1.2 above.

1.5  Operating Agreement: shall mean the Offshore Operating Agreement
("Operating Agreement") attached hereto as Exhibit "B", which shall be executed
by and between NPUSA, Nexen, Ridgewood and Mako Offshore Exploration, Inc.,
effective as of June 1, 2006.

                                    ARTICLE 2
                                    ---------
                               DRILLING OF THE ITW
                               -------------------

2.1  Commitment in the ITW: By executing this Agreement and returning it with
signed originals of the attached AFE and Operating Agreement, Ridgewood commits
to participate in the drilling and evaluation of the ITW on the Nexen Lease and
to pay sixty percent (60%) of the costs of drilling and evaluation to Objective
Depth of said well when such drilling and evaluation is performed pursuant to
the well plan and the AFE. The "Drilling and Evaluation Costs" shall include
permitting, rig mobilization, drilling, sidetracking for operational reasons,
evaluation, testing (not production testing), and plugging/abandonment or
temporary abandonment of the well, but not the costs of completing the well as a
producer. Ridgewood's obligation to pay sixty percent (60%) of such costs shall
terminate, however, on the earlier of (a) the ITW reaching Objective Depth; or
(b) the cumulative (100%) Drilling and Evaluation Costs of the ITW reaching
$22,128,966. Regardless of the depth to which the ITW has been drilled at the
time, when a decision is made by Nexen not to drill the ITW to Objective Depth
due to encountering mechanical difficulties, uncontrolled influx of subsurface
water, abnormal pressures, pressured or heaving shale, salt, granite or other
practicably impenetrable substances, or other similar conditions prevail in the
hole which, in Nexen's reasonable opinion, render further drilling
impracticable, Ridgewood, subject to the limitation in (b) above, shall remain
obligated to pay sixty percent (60%) of the ITW costs incurred prior to the date
of Nexen's decision not to drill the ITW to Objective Depth, sixty percent (60%)
of the cost of plugging/abandonment or temporary abandonment and sixty percent
(60%) of the costs to drill any Substitute Well, as defined in Section 3.3
below. In addition to the promoted Drilling and Evaluation Costs for the ITW or
any Substitute Well, as defined in Section 3.3 below (i.e. payment of sixty
percent (60%) of such costs up to the $22,128,966 cap limit), and subject to
Article 8.7 of the Operating Agreement, Ridgewood agrees to pay forty-five
percent (45%) of the costs of drilling and evaluation to Objective Depth of the
ITW beyond the initial $22,128,966 cumulative (100%) Drilling and Evaluation
Costs of the ITW.

2.2  Subject to (a) Force Majeure, as defined in Section 10.10 below or other
events beyond the reasonable control of Nexen, (b) Nexen's receipt of all
necessary permits required by the Minerals Management Service ("MMS") or any
other governmental body having jurisdiction, (c) completion of Nexen's
operations on Eugene Island Block 295, (d) rig delay or availability, Nexen
shall "commence drilling operations" or "cause drilling operations to commence"
on or before August 30, 2006, for the ITW in accordance with this Agreement and
the provisions of the Operating Agreement. For purposes of this Agreement,
"commence drilling operations" or "cause drilling operations to commence" shall
mean the time when the drilling rig mentioned in Article 3.5 below mobilizes
from Eugene Island Block 295 for the ITW drill site.

WC 109 Participation Agreement 6/1/06

                                       2
<PAGE>

2.3  AFE and Well Plan: Prior to the execution hereof, Nexen and Ridgewood have
reviewed and agreed on the form and content of the AFE, the Well Plan and the
Operating Agreement. The ITW or its Substitute Well(s), as defined in Section
3.3 below, shall be drilled in accordance with this Agreement, the Operating
Agreement, and the attached AFE and Well Plan. The AFE and Well Plan for the ITW
shall be considered approved upon execution of this Agreement by the Parties.

2.4  Relationship of the Parties: This Agreement is not intended to create, and
shall not be construed to create, a relationship of partnership or an
association for profit between or among the Parties. Notwithstanding any
provision herein that the rights and liabilities hereunder are several and not
joint or collective, or that this Agreement and operations hereunder shall not
constitute a partnership, if for federal income tax purposes, this Agreement and
the operations hereunder are regarded as a partnership, each Party hereby
affected elects to be excluded from the application of all of the provisions of
Subchapter "K", Chapter 1, Subtitle "A", of the Internal Revenue Code of 1986,
as permitted and authorized by Section 761 of the Code and the regulations
promulgated thereunder. Operator is authorized and directed to execute on behalf
of each Party hereby affected such evidence of this election as may be required
by the Secretary of the Treasury of the United States or the Federal Internal
Revenue Service, including specifically, but not by way of limitation, all of
the returns, statements, and the data required by Federal Regulations 1.761.
Should there be any requirements that each Party hereby affected give further
evidence of this election, each such Party shall execute such documents and
furnish such other evidence as may be required by the Federal Internal Revenue
Service or as may be necessary to evidence this election. No such Party shall
give any notices or take any other action inconsistent with the election made
hereby. If any present or future income tax laws of the state or states in which
the Nexen Lease is located or any future income tax laws of the United States
contain provisions similar to those in Subchapter "K", Chapter 1, Subtitle "A",
of the Internal Revenue Code of 1986, under which an election similar to that
provided by Section 761 of the Code is permitted, each Party hereby affected
shall make such election as may be permitted or required by such laws. In making
the foregoing election, each such Party states that the income derived by such
Party from operations hereunder can be adequately determined without the
computation of partnership taxable income. Also, each Party elects to be
excluded from the application of all provisions of sub part D of part 2, chapter
1, Title 47, Louisiana Revised Statutes of 1950, as amended, as permitted and
authorized by Section 2203 of said revised statutes and the regulations
promulgated thereunder.

                                    ARTICLE 3
                                    ---------
                               DRILLING OPERATIONS
                               -------------------

3.1  Operatorship: Nexen Petroleum U.S.A. Inc. ("NPUSA") shall be the designated
operator under the Operating Agreement and shall operate the ITW and any
Substitute Well, as defined in Section 3.3 below, and all other operations on
the Nexen Lease pursuant to the terms of this Agreement and the Operating
Agreement.

3.2  Designation of Operator: Ridgewood shall promptly execute and deliver to
NPUSA the necessary "Designation of Operator" forms (Minerals Management Service
("MMS") form 1123) designating NPUSA as the operator and as designated applicant
for oil spill financial

WC 109 Participation Agreement 6/1/06

                                       3
<PAGE>

responsibility for the lease upon which the ITW is drilled under this Agreement,
along with any other documents required to allow NPUSA to serve as operator
under the Operating Agreement and applicable regulations.

3.3  Substitute Well: In the event the ITW encounters conditions or develops
mechanical difficulties that, in Nexen's reasonable opinion, would render
further drilling impractical prior to reaching Objective Depth, and/or require
that the ITW be permanently plugged and abandoned, Nexen shall have the
continuing option, but not the obligation, to commence operations for the
drilling of a "Substitute Well" to replace the ITW. Any Substitute Well shall be
commenced within one hundred eighty (180) days from the date operations on the
ITW (or a previous substitute) were completed or abandoned, whichever is the
latest to occur. Operations on such Substitute Well shall be conducted and
performed under the same terms and conditions as the ITW pursuant to the terms
of this Agreement and the Operating Agreement. However, the drilling of a
Substitute Well pursuant to this Article 3.3 shall in no way increase or
otherwise alter Ridgewood's commitments and obligations set out in Article 2.1
above; i.e., Ridgewood's total commitment for the ITW, which includes any
associated Substitute Well, is limited to the amount determined according to
Article 2.1 above.

3.4  Rig Utilization: NPUSA, as operator, intends to utilize the Ensco 105
drilling rig to drill the ITW with a $140,000 day-rate.

3.5  Well Information: Ridgewood will be entitled to receive any and all raw
well data, analysis and/or information obtained from the ITW, subject to being
in compliance with all applicable provisions of this Agreement.

3.6  Confidentiality: The confidentiality provisions of the Operating Agreement
shall govern the confidentiality obligations and/or disclosure rights and
restrictions of the Parties with respect to any geological, geophysical, or
reservoir information or any logs or other information pertaining to the
progress, tests, or results of any well drilled pursuant to this Agreement.

3.7  Confidentiality of Well Data for the ITW: Certain information customarily
disclosed at weekly Offshore Oil Scout meetings as provided for in the Operating
Agreement may be withheld, at Nexen's sole discretion, including, but not
limited to, information regarding the proposed and actual bottomhole locations
for the well.

3.8  Exploratory Well: The ITW and any Substitute Well therefore drilled in
accordance with Operating Agreement shall be deemed the first Exploratory Well
for purposes of the Operating Agreement.

                                    ARTICLE 4
                                    ---------
                               ASSIGNMENT OF LEASE
                               -------------------

4.1  Governmental Approval of Assignment: The Assignments pursuant to this
Agreement require approval by the MMS. Each Party's obligation hereunder to
transfer or assign such an interest shall be subject to and conditional upon the
other securing the necessary consent or approval of the MMS. Each Party shall
cooperate fully with the other in obtaining such consent

WC 109 Participation Agreement 6/1/06

                                       4
<PAGE>

or approval by the MMS. Each Party shall promptly (i) file of record the
Assignments in the appropriate governmental records and (ii) file for approval
with the MMS (or other applicable governmental agencies) all Assignment
documents for the assigned property. Should approval of the MMS (or any other
similar governmental agency having jurisdiction) be denied, the Party receiving
notice of such denial agrees to provide the other Party with written notice of
such occurrence, along with a copy of all associated written communications, and
the Parties agree to develop. a revised form of assignment in an effort to meet
the MMS's requirements for approval. In the alternative, each Party shall
execute and deliver, or cause to be executed and delivered, such other
documents, and take such other action as a Party may reasonably request.

4.2  Assignments of Lease: Within fifteen (15) days following the execution of
this Agreement and after receipt by Nexen of Ridgewood's payment of $159,750.00
for its proportionate share of sunk costs, Nexen shall assign to Ridgewood, in
the form attached hereto as Exhibit "A", an undivided forty-five percent of
eight-eighths (45% of 8/8ths) record title interest in and to the Nexen Lease
with an effective date of June 1, 2006. Ridgewood shall provide Nexen with all
of the necessary designations required to allow NPUSA to retain the role of
operator on the Nexen Lease.

4.3  Re-Assignments of Lease: In the event Ridgewood does not fulfill its
commitments and obligations pursuant to Article 2.1 above, Ridgewood shall
execute and deliver to Nexen an assignment, in the form attached hereto as
Exhibit "A", of an undivided forty-fve percent of eight-eighths (45% of 8/8ths)
record title interest in and to the Nexen Lease with an effective date of June
1, 2006.

4.4  Contents of Assignments: Any assignments delivered by the Parties
pursuant-to this Agreement shall be delivered without warranty of title, save
and except a warranty of title by, through and under the assignor, and shall be
free and clear of any liens, mortgages, burdens or other encumbrances (other
than the royalty obligation to the MMS and the overriding royalty obligation to
Mako Offshore Exploration, Inc.). Said assignment(s) shall be subject to
agreements described in the assignment document. Any subsequently created
burdens would be borne by the Party creating the additional burden.

                                    ARTICLE 5
                                    ---------
                      APPLICABILITY OF OPERATING AGREEMENT
                      ------------------------------------

5.1  Execution of Operating Agreement: Upon the execution of this Agreement,
Nexen and Ridgewood shall simultaneously execute the Operating Agreement in the
form attached hereto as Exhibit "B".

5.2  Conflicts or Inconsistencies: Should any conflict or inconsistency exist
between this Agreement and the Operating Agreement, or in the event this
Agreement addresses matters not included in the Operating Agreement, this
Agreement shall prevail.

5.3  Facilities Use: If a Party contracts with another entity for the use of
that entity's facilities for either the gathering or transportation of
hydrocarbons produced from a well drilled pursuant to this Agreement or for the
production or handling of such hydrocarbons, that Party shall use

WC 109 Participation Agreement 6/1/06

                                       5
<PAGE>

reasonable efforts to negotiate for the other Party the opportunity to
participate on a pro rata basis in such contracts on the same terms and
conditions applicable to the contracting Party. In the event that an offsite
facility, gathering or transportation system is owned solely by NPUSA or Nexen,
any contract respecting the use of such facility for the gathering or
transportation of hydrocarbons or for the processing or handling of production
will be at rates similar to those prevalent in the industry for similar water
depths, operating conditions and transported products.

                                    ARTICLE 6
                                    ---------
                       ASSIGNMENTS, SUCCESSORS AND ASSIGNS
                       -----------------------------------

6.1  Assignment: Notwithstanding anything herein to the contrary, this Agreement
may not be assigned in whole or in part by Ridgewood, without the prior written
consent of Nexen. An assignment by a Party of any lands affected by this
Agreement shall be made expressly subject to, and the assignee shall agree to
assume and comply with, the terms and provisions of this Agreement. Prior to any
assignments, the assignee shall ratify and become a party to the Operating
Agreement. Notwithstanding any assignments made by Nexen, it will retain
operatorship through completion of operations on the ITW.

6.2  Successors and Assigns: This Agreement shall be binding upon and inure to
the benefit of the Parties and their respective successors, representatives and
assigns and shall constitute a covenant running with the Nexen Lease.

                                    ARTICLE 7
                                    ---------
                                 APPLICABLE LAW
                                 --------------

7.1  Applicable Law: THE PROSPECT AREAS AND ALL OPERATIONS CONDUCTED HEREUNDER
BY THE PARTIES SHALL BE SUBJECT TO ALL VALID AND APPLICABLE FEDERAL LAWS, RULES,
REGULATIONS AND ORDERS ("FEDERAL LAW"). TO THE EXTENT REQUIRED BY FEDERAL LAW,
THE LAWS OF THE STATE ADJACENT TO THE PROSPECT SHALL APPLY. THIS AGREEMENT SHALL
OTHERWISE BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS
OF THE STATE OF LOUISIANA, EXCLUSIVE OF ANY PROVISIONS THAT WOULD DIRECT THE
APPLICATION OF THE SUBSTANTIVE LAW OF ANY OTHER JURISDICTION.

                                    ARTICLE 8
                                    ---------
                                     NOTICES
                                     -------

8.1  Notices: Nexen and Ridgewood agree that any notices, communications, or
documents that either of them desire or that may be required to be delivered to
the other Party pursuant to this Agreement shall be in writing and sent via
telecopy, delivered in person or sent certified mail, postage prepaid, return
receipt requested, addressed to the Parties at the following respective
addresses stated for each:

                         Nexen Petroleum U.S.A. Inc.
                         12790 Merit Drive, Suite 800
                         Dallas, Texas 75251-1270

WC 109 Participation Agreement 6/1/06

                                       6
<PAGE>

                         Attention:     Mr. Steven McMillan
                         Telephone:     (972) 450-4672
                         Facsimile:     (972) 450-4749

                         Ridgewood Energy Corporation
                         11700 Old Katy Road, Suite 280
                         Houston, Texas 77079
                         Attention:     Mr. Randy Bennett
                         Telephone:     (281) 293-9384
                         Facsimile:     (281) 293-7391

For purposes hereof, if facsimile or personal delivery is not possible, refusal
by any Party hereto to accept correspondence sent by certified mail or two (2)
unsuccessful attempts by the U.S. Postal Service to serve any communication sent
by certified mail shall be deemed receipt of such correspondence. Any notice
delivered on Saturday, Sunday, a legal holiday or after 4:15 p.m. in the office
of the recipient shall be deemed to have been delivered on the business day next
following the date of actual receipt. Either Party may change its address for
notices by written notice to the other of them.

                                    ARTICLE 9
                                    ---------
                                      TERM
                                      ----

9.1  Term: The term of this Agreement shall commence on June 1, 2006 and shall
terminate upon the expiration of the last effective Offshore Operating Agreement
executed or ratified pursuant hereto, or by mutual agreement of the Parties,
whichever event occurs first.

                                   ARTICLE 10
                                   ----------
                            MISCELLANEOUS PROVISIONS
                            ------------------------

10.1 Entire Agreement: This Agreement, together with the instruments and
Exhibits referred to herein embody the entire agreement between the Parties with
regard to the subject matter hereof, supersedes all other agreements,
arrangements and understandings, written or oral, relating to the subject matter
hereof, except the Confidentiality Agreement dated May 17, 2006 between Nexen,
NPUSA and Ridgewood, and may be supplemented, altered, amended, modified or
revoked only in writing, signed by all Parties hereto.

10.2 Headings: Except for the definition headings contained in Article 1, all of
the captions, numbering sequences and paragraph headings used in this Agreement
are inserted for convenience only and shall in no way define, limit or describe
the scope or intent of this Agreement or any part thereof, nor shall they have
any legal effect other than to aid a reasonable interpretation of this
Agreement.

10.3 Independent Representation: Each Party has had the benefit of independent
representation with respect to the subject matter of this Agreement. This
Agreement, though drawn by one Party, shall be construed fairly and reasonably
and not more strictly against one Party than the other.

WC 109 Participation Agreement 6/1/06

                                       7
<PAGE>

10.4 Incorporation of Exhibits: Each of the Exhibits referenced in this
Agreement (Exhibit "A" Assignment of Record Title Interest, Exhibit "B" West
Cameron Offshore Operating Agreement, Exhibit "C-1" AFE, Exhibit "C-2" Well
Plan) are incorporated into this Agreement by reference as fully as if the text
of each Exhibit were set forth within the body of this Agreement.

10.5 News Releases: No Party shall issue a press release concerning this
Agreement unless all Parties have approved the issuance and content of such
press release, which approval shall be timely pursued and shall not be
unreasonably withheld, or unless the press release is allowed under the terms of
the Operating Agreement.

10.6 Multiple Counterparts: This Agreement may be executed by signing the
original or a duplicate original counterpart hereof. If this Agreement is
executed in multiple duplicate original counterparts, each such counterpart
shall be deemed an original and all of which when taken together shall
constitute but one and the same Agreement with the same effect as if all Parties
had signed the same instrument. This Agreement may also be ratified by separate
instrument referring to this Agreement and adopting by reference all the
provisions of this Agreement. A ratification shall have the same effect as an
execution of the original Agreement.

10.7 Force Majeure: Any delays in performance or failure by a Party to perform
hereunder, other than the delay or failure to pay money when owed, shall not
constitute default or breach hereunder if and to the extent such delays or
failures of performances are caused by: (i) an act of God; (ii) an act of war,
terrorism, rebellion, or sabotage, or damage resulting therefrom; (iii) a fire,
flood, explosion, accident; (iv) a riot, or strike; (v) any government's
(foreign, federal or state) law, or a rule, regulation or order of any public
body or official exerting or purporting to exercise authority or control
concerning the operations covered hereby (except that a Party's failure to
obtain any necessary and applicable federal, state or local permits shall not be
considered Force Majeure hereunder if the cause or failure to receive such
permits was the result of that Party's negligence or other fault); or (vi) any
other act or event that is beyond the reasonable control of that Party.

10.8 Severability: If any provision of this Agreement is for any reason held to
violate any applicable law, governmental rule or regulation, or if the provision
is held to be unenforceable or unconscionable, then such provision shall be
deemed null and void; but the invalidity of that specific provision shall not be
held to invalidate the remaining provisions of this Agreement. All other
provisions in the entirety of this Agreement (including all Exhibits) shall
remain in full force and effect unless the removal of the invalid provision
destroys the legitimate purposes of this Agreement, in which event this
Agreement shall be canceled and terminated.

10.9 Access to Information: Nexen shall provide Ridgewood access to Nexen's
relevant and applicable records and data that are not subject to contractual or
legal limitations or restrictions on disclosure so that Ridgewood may perform
its due diligence review of Nexen's ownership and obligations associated with
the Nexen Lease. Nexen shall provide Ridgewood with access to technical data
associated with the Nexen Lease, including seismic, maps, well data and geologic
data, subject however, to all legal confidentiality and license restrictions.

WC 109 Participation Agreement 6/1/06

                                       8
<PAGE>

10.10 Binding Effect: This Agreement does not benefit or create any rights in
any person or entity not a party to this Agreement. Further, each Party
represents that upon execution of this Agreement it has secured all necessary
management approvals or other corporate approvals necessary to make this
Agreement a fully binding contract.

EXECUTED as of the date shown.

WITNESSES:                              Nexen Petroleum Offshore U.S.A. Inc.

                                        By:
--------------------------------            --------------------

                                        Name: Gregg E. Radetsky
--------------------------------             -------------------
                                        Title: Vice President, General
                                               Counsel and Asst. Secretary

                                        Date:
                                             ------------------

WITNESSES:                              Ridgewood Energy Corporation

                                        By:
--------------------------------            --------------------

                                        Name: W. Greg Tabor
--------------------------------
                                        Title: Executive Vice President

                                        Date:
                                             ------------------

Signature page to Participation Agreement dated effective June 1, 2006, by and
between Nexen Petroleum Offshore U.S.A. Inc. and Ridgewood Energy Corporation

WC 109 Participation Agreement 6/1/06

                                       9

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