Document:

PETROGEN LOGO APPEARS HERE
PETROGEN

                       FARM- IN AND ACQUISITION AGREEMENT

TO:    CORONADO OIL COMPANY, located at 1550 Denver Club Building, 518 17th
       Street, Denver, Colorado 80202, ("Coronado")

FROM:  PETROGEN,  INC., located at Greenway Plaza, 3200 Southwest Freeway,
       Suite 3300, Houston, Texas 77027 ("Petrogen")

DATE:  December 31st, 2002

RE:    Farm-in and Acquisition of a 100% Working Interest (the "WI") and a 77.6%
       Net Revenue Interest (the "NRI"), of the Enos Creek Field Project
       comprised of the following:

            Township 46 North, Range 100 West, 6th P.M.
            Section 23: SE/4
            Section 25: NE/4, W/2SE/4
            Section 35: SE/4NE/4, Hot Springs County, Wyoming, (the "Land")

       Otherwise  referred to as the Federal Oil & Gas Lease #  WYW-351O2,  (the
       "Lease"),  which  includes the Brown  Government #1, #2 and #3 well-bores
       (the "Well-bores").

       The  Land,  the  Lease  and the  Well-bores  are  hereafter  collectively
       referred to as the "Property".

A. REPRESENTATIONS AND WARRANTIES

1.   The  Assignor  represents  that It Is in  control  of 100% of the legal and
     beneficial   ownership   OF  me  Project  and  that  there  are  no  liens,
     encumbrances,  third party rights OR options,  or any other  imposition  on
     title or ownership or use of the same or the fruits thereof of the Property
     except as may be  imposed  by laws of general  application.  The  /Assignor
     represents  that it is the owner of (he  lands,  assets  or  rights  listed
     hereto  in  Schedule  "A' (and  such is a full and  complete  list  without
     exception)  and is the 100% legal and  beneficial  owner  thereof  and that
     there are no debts, liens, encumbranches, third party rights or options, or
     any other  imposition on Hie Property (except 35 listed in Schedule "A" and
     such is a full and complete  list without  exception)  or to its use of the
     fruits  thereof or to any of its assets except as may be Imposed by laws of
     general) application,

B. FARM-IN AND ALIGNMENT OF THE PROPERTY

1.   Petrogen  shall have the right upon its best efforts in good faith and in a
     prudent and diligent manner to commence Operations to perform the necessary
     work  to  attempt  to put any  formerly  producing  PAY  zones  within  the
     vveH-borea  back into the condition of production  and/or put any potential
     behind-pipe  hydrocarbon  pay zones within the Well-bores  into  production
     ((he "Recomplete*, "Recompletion*, or "Recompletions").

2.   Coronado shall receive 60% of the revenues derived from production from the
     Well-bores,  net only of  royalties  including  but not  limited to Federal
     royalties  (12.5%),  royalty  interests  of  record  as of the date of this
     Agreement (5%); and the Overriding  Royalty (the "ORRI") reserved herein to
     Coronado  (5%),  to  an  aggregate   amount  of  $75,000  (the  "Production
     Payment").  Petrogen reserves the right, but not the obligation,  to pay in
     advance any amount of the balance  outstanding  of and upon the  Production
     Payment at any time.

<PAGE>

3.   At such time as  Coronado  has  received  the  entirety  of the  Production
     payment,  or, at such time as Petrogen has  attempted the  recompletion  at
     least two (2) of the  well-bores,  Coronado  shall within tan business days
     thereafter,  convey to Petrogen  one-hundred  percent  (100%) of Cononado's
     record title and operating rights and interests {the "interests") in and to
     the Property, the assignment of which shall be delivered to Petrogen as the
     then Wyoming Bureau of Land Management (the "BLM") approved Operator of the
     Property,  reserving  to  Coronado  an  exclusive  five  percent  (5%) ORRI
     proportional  to that of Petrogen's  net WI upon the Property,  which shall
     not bear any of the costs of production  as defined in the Wyoming  Statute
     30-5-304,  and  Petrogen  shall  compfy  with the  Order of the  Authorized
     Officer stated in the BLM extension letter dated January 6th, 2003,

4.   After  Coronado  ha$  received  the  entirety  of THE  Production  Payment,
     Petrogen  shall  thereafter  receive one hundred  percent (100%) of all the
     income derived from  hydrocarbon  production from the said Well-bores until
     such time as  Petrogen  has  recouped  the total of its  expenditures  (the
     "Recoup" or "Recoupment") to Recompute the Well-bores,  Including,  but not
     limited to, the costs for  testing,  completion,  recompletion,  reworking,
     Production Payments, etc., and associated operating expenses and overhead.

5.   Coronado shall reserve the right,  but not the obligation,  for a period of
     twelve (12) months  after  Petrogen's  Recoupment,  to convert its retained
     ORRI to a fifty percent (50%) WI in the said Well-bores,  in (hat instance,
     Petrogen's interest in the Well-bores shall convert to a 50% WI of an 82.5%
     NRI.

6.   Petrogen agrees that it shall spud at least one new Frontier well-bore upon
     the  Lease  (the  "New  Well")  no  later  than   November  1U,  2004  (the
     "Performance  Date"),  Petrogen shall provide  Coronado a written notice of
     its Intention to commence the New Well, and Coronado shall inform  Petrogen
     within a period of thirty (30) days thereafter (the "Notice Period*) of its
     intention to elder participate in the New Well OR to not participate in the
     New Well.

7.   If Coronado elects to participate in the New Well, Coronado's retained ORRI
     upon (he Property in regard to THE New Well shall convert to a 50% WI of an
     82.5% NRI.

8.   If  Coronado  elects to not  participate  in the New Well within the Notice
     Period, or, defaults upon payment to Petrogen of its proportionate share of
     the costs  associated  with the New Well,  Petrogen will then commence the
     New Well  without the  participation  of Coronado,  and, In that  instance,
     Petrogen  Will  then  retain  a 100% WI of a 77,6%  NRI on ail  Hydrocarbon
     developments  and  production  revenues until such time it has recouped its
     expenses.

9.   Coronado reserves the right, but not the obligation, for a period of twelve
     (12) months after  Petrogen's  Recoupment  from the New Wed, to convert its
     retained  ORRI  to a fifty  percent  (50%) WI in said  New  Well.  In that
     instance,  Petrogen's interest IN the New Well shall convert to a $0% WI of
     an 82.6% NRI.

10.  Should  Petrogen elect to not proceed with the spudding of one New Wed upon
     the Property by the Performance Date, Petrogen snail convey to Coronado one
     hundred  percent  (100%) of  Petrogen's  Interests in and to the  Property,
     however,  reserving  Petrogen's  Interests In and to the Well-bores and the
     production unit of each Well-bore it has Recompleted.

C. AREA OF MUTUAL INTEREST

1.   Petrogen and Coronado agree to the formation of an Area of Mutual  Interest
     (the "AM!"}  comprised of Sections 23, 24, 25, 26, 35 and 36 of Township 46
     North,  Range 100 West, as well as the lands covered within Sections of the
     Property, but that are not currently under leasehold within the composition
     of the Property,  Petrogen and Coronado agree to work in  collaboration  to
     acquire leasehold  interests within the AMI.

2.   Petrogen  shall  pay and bear  one  hundred  percent  (100%)  of the  costs
     associated   with   acquisition  OF  leasehold  and  other  interests  (the
     "Leasehold") within the AMI.

3.   Petrogen reserves the right to decline acquisition of any and all interests
     within the AMI if  favorable  acquisition  terms cannot  be  reached
     between  Petrogen  and the current  mineral or lease  owners  and/or lease
     title holders within the AMI.

4.   Upon Petrogen having compiled acquisition of any Leasehold Interests within
     the AMI,  Petrogen and Coronado will WORK in collaboration to ascertain the
     most geologically advantageous locations to spud two (2) new

<PAGE>

     Frontier  Formation tests (the "Frontier  Wells") within the AMI. Petrogen
     reserves  me right  to the  final  decision  as to the location of where
     the Frontiere Wellsfls will be located.

6.   Petrogen shall receive from either one of, or Both of the Frontier Wells it
     drills and completes, one hundred percent (100%) of the income derived from
     hydrocarbon  production  until such time as Petrogen has recouped the total
     of its expenditures, including, but not limited to, the coats FOR drilling,
     testing,  completion,  etc., and associated  operating  expanses,  with the
     assignment  of a two and one half  percent  (2.5%)  ORRI (tne 2.5% ORRI) to
     Coronado, which shall not bear any of the costs of production as defined In
     the Wyoming Statute 30-5-304.

7.   Coronado shall reserve the right,  but not the obligation,  for a period of
     twelve (12) months  after  Petrogen's  Recoupment,  to convert its retained
     2,5% ORRI to a twenty five percent  (25%) Wl In the Frontier  Wells and the
     associated leasses upon Petrogen's Leasehold within the AMI.

8.   Through its acquisition efforts within THE AMI AS noted,  Petrogen reserves
     the right to attempt to acquire (he  American  Petrofina  well-bore  (the
     "APW").

9.   Upon  Petrogen's  receipt  of an  assignment  upon the APW,  Petrogen  will
     attempt  the  Recompletion  of the APW all  costs of  which  shall be borne
     solely by Petrogen.

10.  Petrogen shad  receive) one hundred  percent  (100%) of the income  derived
     from hydrocarbon production from the APW until such time as it has Recouped
     the total of Its  expenditures  to Recomplete the APW,  including,  but not
     limited to, the costs for  testing,  completion,  recompletion,  reworking,
     etc., and associated operating expenses, with the assignment of a 2.5% ORRI
     to Coronado, which shall not bear any of the costs of production as defined
     in the Wyoming Statute 30-5-304.

11.  Coronado shaa reserve the right,  but not the  obligation,  for a period of
     twelve (12) months  after  Petrogen's  Recoupment,  to convert its retained
     2.5%  ORRI in the APW and tha  associated  leases  upon  Petrogen's  leased
     interests  within tho AMI  respective  of the APW to a twenty five  percent
     (25%) WI.

D. GENERAL MATTERS

1.   The parties warrant  employing good faith, due diligence,  and best efforts
     in the  performance  of this  agreement  In the event of any  dispute,  the
     parties  shall  employ the term*  hereof (or of any  further or  collateral
     agreements)  and terms  standard in the  Industry  where not  addressed  by
     agreements.

2.   This  agreement  shall be kept  confidential  and no disclosure of the same
     shall be made without mutual consent, which shall not be unreasonably with
     held.

3.   Petrogen and Coronado shall enter a mutually agreeable operating agreement.

4.   Petrogen  shall maintain  adequate  liability  Insurance,  a proof of which
     shall be furnished to Coronado poor to the commencement of operations.

5.   The Situs of this  agreement  shall be governed by the laws of the State of
     Colorado.

6.   This agreement  supercedes  all previous  agreements  between  Coronado and
     Petrogen, whether oral, written, expressed or implied.

<PAGE>

We trust that the foregoing  terms are acceptable to you we ask that you execute
and return a copy of this LOI and the same will be binding upon us from the date
of your acceptance.

Yours truly,

PETROGEN. [NC.

/s/ SACHA H. SPINDLER
    __________________________________
    Sacha H. Spindler - President, CEO

    __________________________________
    Witness

The foregoing is hereby agreed effective this 3rd day of February, 2003.

CORONADO OIL COMPANY

/s/ JOHN BOLLENBACHER
    __________________________________
    John Bollenbacher - President

    /s/ MARVIN A. HENRY
    __________________________________
    WitnessEXHIBIT 10-7

                                      FILED

                               '03 JAN 17 PM 3 2?

                                   WAYNE SMiTH
                                 CHANCERY CLERK

                           ASSIGNMENT AND BILL OF SALE

 STATE OF MISSISSIPPI
                                        *
 COUNTY OF LAMAR                        *         KNOW ALL MEN BY THESE PRESENTS
                                        *

         WHEREAS,  CROWN ROYALTIES OF LOUISIANA,  INC., a Louisiana  corporation
domiciled  in  Lafourche  Parish,  Louisiana,   whose  mailing  address  is  312
Supercharge  Drive,  Thibodaux,  Louisiana,  70360,  hereinafter  referred to as
"ASSIGNOR",  is the owner and holder of certain  interests in those certain Oil,
Gas and Mineral Leases,  wells,  wellbores and related and associated  equipment
and property described on the EXHIBIT "A" attached hereto and made a part hereof
by reference for all purposes, hereinafter collectively referred to as LEASE and
WELL.

         WHEREAS,  ASSIGNOR  desires  to convey to  PETROGEN,  INC.,  a Colorado
corporation, whose current mailing address is Greenway Plaza, 3200 S.W. Freeway,
Suite  3300,  Houston  TX 7?02  hereinafter  referred  to as  "ASSIGNEE"  all of
ASSIGNOR'S right, title and interest in the LEASE and WELL.

         NOW,  THEREFORE  for  and in  consideration  of the sum of  TWENTY  TWO
THOUSAND  FIVE  HUNDRED  AND  NO/100  ($22,500.00)  DOLLARS  and other  valuable
consideration, in hand paid to ASSIGNOR by ASSIGNEE, the receipt and sufficiency
of which being hereby  acknowledged  and full  acquittance is granted  therefor,
ASSIGNOR does hereby BARGAIN,  SELL,  TRANSFER,  ASSIGN and CONVEY unto ASSIGNEE
all of ASSIGNOR'S right, title and interest in and to the LEASE and WELL.

         Furthermore,  ASSIGNOR  assigns the  foregoing  interests "AS IS, WHERE
IS", without

<PAGE>

merchantability of same to ASSIGNEE.

         ASSIGNOR agrees to protect,  defend,  indemnify and hold ASSIGNEE,  its
Directors,  Officers,  employees and representatives  free and harmless from and
against any and all costs,  expenses,  claims,  demands,  actions, and causes of
action of each and every kind and character arising out of or in connection with
ASSIGNOR'S  or its agent's or employee's  operations  on the LEASE or WELL,  its
associated personal property and the production therefrom,  arising prior to the
Effective Date of this agreement.

         This  conveyance  is  subject  to the  terms  of  the  LEASE,  and  all
instruments of record affecting same and any reservations,  terms and conditions
of the  agreements  identified  on EXHIBIT "A"  attached  hereto and made a part
hereof, provided,  however, that in the event any such instruments or agreements
have expired, terminated or for any other reason whatsoever have ceased to be of
any further effect as of this date, it is not intended by this reference  herein
to validate or re-effectuate any said instruments or agreements. This conveyance
is also subject to all royalties,  overriding royalties, production payments and
other burdens of record.

         This  ASSIGNMENT  AND BILL OF SALE  made by  ASSIGNOR  is  accepted  by
ASSIGNEE without representations, covenants or warranties as to title or quantum
of interest conveyed,  or representation as to the merchantability of any of the
equipment  or its  fitness for any  purpose,  either  express or implied.  It is
understood and agreed ASSIGNEE have inspected the LEASE, WELL and its associated
personal   property  and  satisfied   themselves   as  to  their   physical  and
environmental condition, both surface and subsurface, and

                                      -2-

<PAGE>

 ASSIGNEE  accept  same in  their  "AS IS,  WHERE  IS"  condition.  Furthermore,
 ASSIGNOR  makes no warranty or  representation,  express or implied,  as to the
 accuracy or  completeness of any data,  information or materials  heretofore or
 hereafter furnished to ASSIGNEE in connection with the subject interests, or as
 to the quality or quantity of or ability to produce hydrocarbon  reserves,  Any
 and all such data or  materials  furnished by ASSIGNOR are provided to ASSIGNEE
 as a convenience and any reliance on or use of same shall be at ASSIGNEE'S sole
 risk.

         All taxes, including, but not limited to, income taxes, Windfall Profit
Taxes,  state  severance  taxes,  ad valorem taxes,  and any other local,  state
severance  taxes or  assessments  attributable  to the LEASE,  OR any production
therefrom after the Effective Date shall be ASSIGNEE'S  responsibility,  and all
deductions,  credits and  obligations  pertaining  to the  aforementioned  taxes
attributable  to the LEASE,  or any production  therefrom prior to the Effective
Date, no matter when received, shall belong to ASSIGNOR.

         ASSIGNEE shall be solely  responsible for all costs associated with the
filing  and  recording  of this  ASSIGNMENT  AND  BILL OF SALE or any  documents
related to this  instrument.  ASSIGNEE  shall advise  ASSIGNOR or the  pertinent
recording data and provide a copy of the recorded  instrument  within 30 days of
recordation.

         No title opinion was requested of me,  Notary,  and the parties  hereto
specifically release me from any and all responsibility therefor.

         TO HAVE  AND TO HOLD  the  assigned  undivided  interest  in and to the
aforementioned  LEASE  and  WELL  together  with  all and  singular  rights  and
appurtenances thereto unto

                                       -3-

<PAGE>

ASSIGNEE,  its  he/rs  or  assigns,  forever  subject  to the  reservations  and
conditions hereinabove set forth.

         IN WITNESS  WHEREOF,  this  instrument may be executed in any number of
counterparts,  each of which shall be  considered  an original for all purposes.
Failure of any party to execute this Agreement and Bill of Sale shall not render
it  ineffective  as to any  other  party  or  parties  who  execute  same.  This
instrument dated effective executed in duplicate originals as of the 16th day of
December, 2002.

WITNESSES:                                 ASSIGNOR:

/s/ UNKNOWN                                CROWN ROYALTIES OF LOUISIANA, INC

/s/ S. EHRMANN                             BY: /S/ KEITH BONDREAUX
                                           NAME: KEITH BONDREAUX
                                           TITLE: PRES

WITNESSES:                                 ASSIGNEE:

/s/ UNKNOWN                                PETROGEN, INC.

/s/ S. EHRMANN                             BY: /S/ LEO WM. KERRIGAN
                                           NAME:  LEO WM. KERRIGAN
                                           TITLE:  VICE PRESIDENT, DIRECTOR

                                      -4-
<PAGE>

STATE OF LOUISIANA

PARISH OF TERREBONNE

         BEFORE  ME,  the  undersigned  Notary  Public,  duly  commissioned  and
qualified in and for the Parish and State aforesaid,  and in the presence of the
witnesses hereinafter named and undersigned,

         PERSONALLY  CAME  AND  APPEARED  Keith  Bordeaux,  President  of  CROWN
ROYALTIES  OF  LOUISIANA,  INC ., who  declared  to me that  this  document  was
executed for the purpose and consideration  expressed therein. Houma, Louisiana,
this 16th day of December, .

WITNESSES:

/s/ UNKNOWN                             /s/ KEITH BORDEAUX

/s/ S. EHRMANN

                        SWORN TO AND SUBSCRIBED BEFORE ME
                         THIS 16TH DAY OF DECEMBER, 2002

                             /s/ JOSE A. CASTELLEON
                            -----------------------
                                 NOTARY PUBLIC

                            [NOTARY SEAL GOES HERE]

                             [STATE SEAL GOES HERE]

                                      -5-

<PAGE>

STATE OF LOUISIANA

PARISH OF TERREBONNE

         BEFORE  ME,  the  undersigned  Notary  Public,  duly  commissioned  and
qualified in and for the Parish and State aforesaid,  and in the presence of the
witnesses hereinafter named and undersigned.

         PERSONALLY  CAME  AND  APPEARED  LEO  WM.  KERRIGAN,   VICE  PRESIDENT,
PETROGEN,  INC.,  who  declared to me that this  document  was  executed for the
purpose and consideration expressed therein.

         Houma, Louisiana, this 16th day of December, 2002.

WITNESSES:

/s/ UNKNOWN                     /s/ LEO WM. KERRIGAN

/s/ S. EHRMANN

                       SWORN TO AND SUBSCRIBED BEFORE ME
                         THIS 16 DAY OF DECEMBER, 2002

                             /s/ JOSE A. CASTELLON
                             ---------------------
                                 NOTARY PUBLIC

                            [NOTARY SEAL GOES HERE]

                             [STATE SEAL GOES HERE]

                                      -6-

<PAGE>

                                   RESOLUTION

         BE IT  RESOLVED  by the  Board  of  Directors  of  CROWN  ROYALTIES  OF
LOUISIANA,  INC.,  that  its  President  Keith  Bordeaux  be  and  he is  hereby
authorized,  empowered and directed,  for and on behalf of said corporation,  to
effect the following transaction:

         To  execute  on  behalf  of  CROWN  ROYALTIES  OF  LOUISIANA,  INC.  an
         Assignment and Bill of Sale to Petrogen, Inc. of all of interest s held
         by the corporation in the Lease, Well, its associated personal property
         and any production specified on Exhibit "A" attached to said Assignment
         and Bill of Sale.

said act to contain  such  other  terms,  conditions  and  stipulations  as said
officer might deem wise and expedient in his sole and uncontrolled discretion.

         BE IT FURTHER  RESOLVED that the said KEITH BORDEAUX hereby  authorized
to appear  before any Notary  Public for the purpose of  executing  said act, or
other instruments,  papers or documents which might be necessary or proper under
the  circumstances,  we hereby  approving,  ratifying and confirming any and all
acts which the said officer may do or perform by virtue of this mandate.

                                    ********

         I,  Secretary of CROWN  ROYALTIES  OF  LOUSIIANA,  INC., a  corporation
organized  and  chartered  under  and by  virtue  of the  laws of the  State  of
Louisiana, with its legal domicile

<PAGE>

in the Parish of Terrebonne,  Louisiana, do hereby certify that the foregoing is
a true and correct copy of the  resolution  unanimously  adopted by the Board of
Directors  of said  corporation  at a meeting  held on  December  12, 2002 which
meeting a quorum was present and voting.

                                /s/ MARY BORDEAUX
                                --------------------------
                                    SECRETARY

ATTEST

KEITH BORDEAUX
------------------
PRESIDENT

<PAGE>

                                   RESOLUTION

         BE IT RESOLVED by the board of Directors of  PETROGEN,  INC.,  thaT its
Vice President Leo Wm.  Kerrigan be and he is hereby  authorized,  empowered and
directed, for and on behalf of  sai9"(pound)brporation,  to effect the following
transaction:

         To execute on behalf of Petrogen,  Inc. an Assignment  and Bill of Sale
         from  Crown  Royalties  of  Louisiana,  Inc.  in the Lease,  Well,  its
         associated  personal  property and any production  specified on Exhibit
         "A" attached to said Assignment and Bill of Sale.

         said act to contain such other terms,  conditions and  stipulations  as
said  officer  might  deem  wise and  expedient  in his  sole  and  uncontrolled
discretion.

         BE IT  FURTHER  RESOLVED  that  the  said Leo Wm.  Kerrigan  is  hereby
authorized to appear  before any Notary Public for the purpose of  executing
act, or other  instruments,  papers or  documents  which might be  necessary  or
proper under the  circumstances,  we hereby approving,  ratifying and confirming
any and all acts  which the said  officer  may do or  perform  by virtue of this
mandate.

                                    ********

         I, Secretary of Petrogen, Inc., do hereby certify that the foregoing is
a true and correct copy of the  resolution  unanimously  adopted by the Board of
Directors of said corporation at

<PAGE>

a meeting held on ______________ 1999, at which meeting a quorum was present and
voting.

                                        -----------------------
                                           SECRETARY

ATTEST:

/s/ LEO WM. KERRIGAN
-----------------------
VICE PRESIDENT

<PAGE>

                                   EXHIBIT "A"

All of Crown Royalties ' Inc's interest in the following  described property and
leases, to-wit:

A.       S. J; HOOPER NO. 1 WELL, BAXTERVILLE FIELD, MARION COUNTY, MISSISSIPPI,
         TOGETHER WITH THE WELLBORE,  CASING,  TUBING, POMPS, PIPES,  PIPELINES,
         TANKS, AND ALL ASSOCIATED PROPERTY AND EQUIPMENT;

B.       LEASES

         1.   Oil,  Gas and  Mineral  Lease dated  February 9, 1943,  from S. J.
              Hooper,  as lessor to Pres  Cochrane,  as lessee,  and recorded in
              Book 161, at page 584, of the Oil and Gas Records in the office of
              the Chancery Clerk of Marion- County, Mississippi;

         2.   Oil,  Gas and  Mineral  Lease  dated  July 7,  1948,  from Carl E.
              Richardson,  as lessor, to Danciger Oil and Refining  Company,  as
              lessee, and recorded in Book 249, at page 111, of said Oil and Gas
              Records;

         3.   Oil,  Gas and  Mineral  Lease  dated  July 7, 1948,  from  Juanita
              Richardson Dion, as lessor,  to Danciger Oil and Refining Company,
              as lessee,  and recorded in Book 249, at page 110, of said Oil and
              Gas Records;

         4.   Oil, Gas and Mineral Lease dated July 7, 1948, from Mrs. Henrietta
              L.  Richardson  Hargrove,  et al, as lessors,  to Danciger Oil and
              Refining  Company,  as lessee,  and  recorded in Book 249, at page
              109, of said Oil and Gas Records;

         5.   Oil,  Gas and  Mineral  Lease  dated  July 7, 1948,  from  Madonna
              Richardson  Miller,  as  lessor,  to  Danciger  Oil  and  Refining
              Company, as lessee? and recorded in Book 249, at page 108, of said
              Oil and Gas Records;

         6.   Oil, Gas and Mineral Lease dated July 7, 1948, from W. V. Tompkins
              and Chas. H.  Tompkins,  as lessors,  to Danciger Oil and Refining
              Company, as lessee, and recorded in Book 249, at page 107, of said
              Oil and Gas Records;

         7.   Oil,  Gas and  Mineral  Lease  dated  July 7, 1948,  from  Juanita
              Richardson Dion, as lessor,  to Danciger Oil and Refining Company,
              as lessee,  and recorded in Book 249, at page 105, of said Oil and
              Gas Records;

<PAGE>

         8.   Oil, Gas and Mineral Lease dated July 7, 1948, from H.C. Rawls, et
              al, as lessors,  to Danciger Oil and Refining Company,  as lessee,
              and  recorded  in Book  249,  at  page  112,  of said  Oil and Gas
              Records;

ONLY INSOFAR, HOWEVER, as the above described leases cover:

              the NE/4 of NE/4,  Section  1,  Township  1 North,  Range 17 West,
              Marion County, Mississippi, containing 40 acres, more or less;

all as amended, ratified and confirmed by the following instruments and by other
instruments:

         1.   Dated  August  31,  1949,  executed  by H. C.  Rawls,  et al,  and
              recorded in Book 261, at page 125, of said Oil and Gas Records;

         2.   Dated August 15, 1949, executed by E. M. Rush, et al, and recorded
              in Book 261, at page 379, of said Oil and Gas Records;

         3.   Dated  August  15,  1949,  executed  by R. A.  Irwin,  et al,  and
              recorded in Book 261, at page 388, of said Oil and Gas Records;
         4.   Dated August 15, 1949, executed by E. M. Rush, et al, and recorded
              in Book 261, at page 553, of said Oil and Gas Records;

         5.   Dated August 12,  1949,  executed by M. V.  Tompkins and Chas.  H.
              Tompkins,  and  recorded in Book 261, at page 388, of said Oil and
              Gas Records;

         6.   Dated August 18, 1949, executed by Evelyn R. Willoby, and recorded
              in Book 268, at page 25, of said Oil and Gas Records;

         7.   Dated August 16, 1949,  executed by Juanita R. Dion,  and recorded
              in Book 268, at page 19, of said Oil and Gas Records;

         8.   Dated September 2, 1949,  executed by Madonna  Richardson  Miller,
              and recorded in Book 268, at page 20, of said Oil and Gas Records;

         9.   Dated  August  12,  1949,  executed  by  Henrietta  L-  Richardson
              Hargrove, et al, and recorded in Book 268, at page 20, of said Oil
              and Gas Records;
1.

<PAGE>

SAID LEASEHOLD ESTATES BEING SUBJECT TO THE FOLLOWING:

         1.   The terms and  conditions of that certain  Contract and Assignment
              of Overriding Royalty dated July 8, 1948, between Danciger Oil and
              Refining Company, as one party and Orval E. Richardson,  et al, as
              the other  party,  and  recorded in Book 245, at page 503, of said
              Oil and Gas Records; and

         2.   That certain Operating  Agreement dated October 15, 1944,  between
              Danciger Oil & Refining Company, as Operator,  and T. S. Stoneman,
              as Non-operator.

C. T. W. DAVIS NO. 1 WELL,  (Salt  water  disposal),  Baxtervxlle  Field,  Lamar
County, Mississippi.

A salt water disposal system, including a well located:

              330 feet  North and 330 feet West of the  Southeast  corner of the
              SW/4 of SW/4,  Section 31, Township 2 North,  Range 16 West, Lamar
              County, Mississippi;

and all equipment, pumps, machinery,  lines, pipelines,  easements and rights of
way now  used in the  operation  of such  system,  said  system  and the  rights
pertaining thereto originally being described in the following instrument:

              Dated  October  18,  1972,  from  Bass  Pecan  Company,  Inc.,  as
              Assignor,  to George  R.  Grim,  Jr.  and L. J.  Wickenhauser,  as
              Assignees, and recorded in Book 5-E, at page 295, of the Land Deed
              Records  in the  office  of the  Chancery  Clerk of Lamar  County,
              Mississippi.

                        [CHANCERY CLERK SEAL GOES HERE]

                      CERTIFICATE OF FILING AND RECORDING
                       STATE OF MISSISSIPPI LAMAR COUNTY

                          WAYNE SMITH, CHANCERY CLERK
                           OIL LEASE BOOK 112 PAGE 41

                    INDEXED [X] RECORDED [X] ABSTRACTED [ ]
                                 /S/ROSE TRAVIS

<PAGE>

                           ASSIGNMENT AND BILL OF SALE

 STATE OF MISSISSIPPI
                                        *
 COUNTY OF LAMAR                        *         KNOW ALL MEN BY THESE PRESENTS
                                        *

         WHEREAS,  CROWN ROYALTIES OF LOUISIANA,  INC., a Louisiana  corporation
domiciled  in  Lafourche  Parish,  Louisiana,   whose  mailing  address  is  312
Supercharge  Drive,  Thibodaux,  Louisiana,  70360,  hereinafter  referred to as
"ASSIGNOR",  is the ownerand  holder of certain  interests in those certain Oil,
Gas and Mineral Leases,  wells,  wellbores and related and associated  equipment
and property described on the EXHIBIT "A" attached hereto and made a part hereof
by reference for all purposes, hereinafter collectively referred to as LEASE and
WELL.

         WHEREAS,  ASSIGNOR  desires  to convey to  PETROGEN,  INC.,  a Colorado
corporation, whose current mailing address is Greenway Plaza, 3200 S.W. Freeway,
Suite  3300,  Houston  TX 7?02  hereinafter  referred  to as  "ASSIGNEE"  all of
ASSIGNOR'S right, title and interest in the LEASE and WELL.

         NOW,  THEREFORE  for  and in  consideration  of the sum of  TWENTY  TWO
THOUSAND  FIVE  HUNDRED  AND  NO/100  ($22,500.00)  DOLLARS  and other  valuable
consideration, in hand paid to ASSIGNOR by ASSIGNEE, the receipt and sufficiency
of which being hereby  acknowledged  and full  acquittance is granted  therefor,
ASSIGNOR does hereby BARGAIN,  SELL,  TRANSFER,  ASSIGN and CONVEY unto ASSIGNEE
all of ASSIGNOR'S right, title and interest in and to the LEASE and WELL.

         Furthermore,  ASSIGNOR  assigns the  foregoing  interests "AS IS, WHERE
IS", without

<PAGE>

merchantability of same to ASSIGNEE.

         ASSIGNOR agrees to protect,  defend,  indemnify and hold ASSIGNEE,  its
Directors,  Officers,  employees and representatives  free and harmless from and
against any and all costs,  expenses,  claims,  demands,  actions, and causes of
action of each and every kind and character arising out of or in connection with
ASSIGNOR'S  or its agent's or employee's  operations  on the LEASE or WELL,  its
associated personal property and the production therefrom,  arising prior to the
Effective Date of this agreement.

         This  conveyance  is  subject  to the  terms  of  the  LEASE,  and  all
instruments of record affecting same and any reservations,  terms and conditions
of the  agreements  identified  on EXHIBIT "A"  attached  hereto and made a part
hereof, provided,  however, that in the event any such instruments or agreements
have expired, terminated or for any other reason whatsoever have ceased to be of
any further effect as of this date, it is not intended by this reference  herein
to validate or re-effectuate any said instruments or agreements. This conveyance
is also subject to all royalties,  overriding royalties, production payments and
other burdens of record.

         This  ASSIGNMENT  AND BILL OF SALE  made by  ASSIGNOR  is  accepted  by
ASSIGNEE without representations, covenants or warranties as to title or quantum
of interest conveyed,  or representation as to the merchantability of any of the
equipment  or its  fitness for any  purpose,  either  express or implied.  It is
understood and agreed ASSIGNEE have inspected the LEASE, WELL and its associated
personal   property  and  satisfied   themselves   as  to  their   physical  and
environmental condition, both surface and subsurface, and

                                      -2-

<PAGE>

 ASSIGNEE  accept  same in  their  "AS IS,  WHERE  IS"  condition.  Furthermore,
 ASSIGNOR  makes no warranty or  representation,  express or implied,  as to the
 accuracy or  completeness of any data,  information or materials  heretofore or
 hereafter furnished to ASSIGNEE in connection with the subject interests, or as
 to the quality or quantity of or ability to produce hydrocarbon  reserves,  Any
 and all such data or  materials  furnished by ASSIGNOR are provided to ASSIGNEE
 as a convenience and any reliance on or use of same shall be at ASSIGNEE'S sole
 risk.

         All taxes, including, but not limited to, income taxes, Windfall Profit
Taxes,  state  severance  taxes,  ad valorem taxes,  and any other local,  state
severance  taxes or  assessments  attributable  to the LEASE,  OR any production
therefrom after the Effective Date shall be ASSIGNEE'S  responsibility,  and all
deductions,  credits and  obligations  pertaining  to the  aforementioned  taxes
attributable  to the LEASE,  or any production  therefrom prior to the Effective
Date, no matter when received, shall belong to ASSIGNOR.

         ASSIGNEE shall be solely  responsible for all costs associated with the
filing  and  recording  of this  ASSIGNMENT  AND  BILL OF SALE or any  documents
related to this  instrument.  ASSIGNEE  shall advise  ASSIGNOR or the  pertinent
recording data and provide a copy of the recorded  instrument  within 30 days of
recordation.

         No title opinion was requested of me,  Notary,  and the parties  hereto
specifically release me from any and all responsibility therefor.

         TO HAVE  AND TO HOLD  the  assigned  undivided  interest  in and to the
aforementioned  LEASE  and  WELL  together  with  all and  singular  rights  and
appurtenances thereto unto

                                       -3-

<PAGE>

ASSIGNEE,  its  he/rs  or  assigns,  forever  subject  to the  reservations  and
conditions hereinabove set forth.

         IN WITNESS  WHEREOF,  this  instrument may be executed in any number of
counterparts,  each of which shall be  considered  an original for all purposes.
Failure of any party to execute this Agreement and Bill of Sale shall not render
it  ineffective  as to any  other  party  or  parties  who  execute  same.  This
instrument shall be effective on the date of execution by the parties.

Thus done and signed on this 16th day of December, 2002.

WITNESSES:                                 ASSIGNOR:

/s/ UNKNOWN                                CROWN ROYALTIES OF LOUISIANA, INC

/s/ S. EHRMANN                             BY: /S/ KEITH BONDREAUX
                                           NAME: KEITH BONDREAUX
                                           TITLE: PRES

WITNESSES:                                 ASSIGNEE:

/s/ UNKNOWN                                PETROGEN, INC.

/s/ S. EHRMANN                             BY: /S/ LEO WM. KERRIGAN
                                           NAME:  LEO WM. KERRIGAN
                                           TITLE:  VICE PRESIDENT, DIRECTOR

                                      -4-

<PAGE>

STATE OF LOUISIANA

PARISH OF TERREBONNE

         BEFORE  ME,  the  undersigned  Notary  Public,  duly  commissioned  and
qualified in and for the Parish and State aforesaid,  and in the presence of the
witnesses hereinafter named and undersigned,

         PERSONALLY  CAME  AND  APPEARED  Keith  Bordeaux,  President  of  CROWN
ROYALTIES  OF  LOUISIANA,  INC ., who  declared  to me that  this  document  was
executed for the purpose and consideration  expressed therein. Houma, Louisiana,
this 16th day of December, .

WITNESSES:

/s/ UNKNOWN                             /s/ KEITH BORDEAUX

/s/ S. EHRMANN

                        SWORN TO AND SUBSCRIBED BEFORE ME
                         THIS 16TH DAY OF DECEMBER, 2002

                             /s/ JOSE A. CASTELLEON
                            -----------------------
                                 NOTARY PUBLIC

                            [NOTARY SEAL GOES HERE]

                             [STATE SEAL GOES HERE]

                                      -5-

<PAGE>

STATE OF LOUISIANA

PARISH OF TERREBONNE

         BEFORE  ME,  the  undersigned  Notary  Public,  duly  commissioned  and
qualified in and for the Parish and State aforesaid,  and in the presence of the
witnesses hereinafter named and undersigned.

         PERSONALLY  CAME  AND  APPEARED  LEO  WM.  KERRIGAN,   VICE  PRESIDENT,
PETROGEN,  INC.,  who  declared to me that this  document  was  executed for the
purpose and consideration expressed therein.

         Houma, Louisiana, this 16th day of December, 2002.

WITNESSES:

/s/ UNKNOWN                     /s/ LEO WM. KERRIGAN

/s/ S. EHRMANN

                       SWORN TO AND SUBSCRIBED BEFORE ME
                         THIS 16 DAY OF DECEMBER, 2002

                             /s/ JOSE A. CASTELLON
                             ---------------------
                                 NOTARY PUBLIC

                            [NOTARY SEAL GOES HERE]

                             [STATE SEAL GOES HERE]

                                      -6-

<PAGE>

                                   RESOLUTION

         BE IT  RESOLVED  by the  Board  of  Directors  of  CROWN  ROYALTIES  OF
LOUISIANA,  INC.,  that  its  President  Keith  Bordeaux  be  and  he is  hereby
authorized,  empowered and directed,  for and on behalf of said corporation,  to
effect the following transaction:

         To  execute  on  behalf  of  CROWN  ROYALTIES  OF  LOUISIANA,  INC.  an
         Assignment and Bill of Sale to Petrogen, Inc. of all of interest s held
         by the corporation in the Lease, Well, its associated personal property
         and any production specified on Exhibit "A" attached to said Assignment
         and Bill of Sale.

said act to contain  such  other  terms,  conditions  and  stipulations  as said
officer might deem wise and expedient in his sole and uncontrolled discretion.

         BE IT FURTHER  RESOLVED that the said KEITH BORDEAUX hereby  authorized
to appear  before any Notary  Public for the purpose of  executing  said act, or
other instruments,  papers or documents which might be necessary or proper under
the  circumstances,  we hereby  approving,  ratifying and confirming any and all
acts which the said officer may do or perform by virtue of this mandate.

                                    ********

         I,  Secretary of CROWN  ROYALTIES  OF  LOUSIIANA,  INC., a  corporation
organized  and  chartered  under  and by  virtue  of the  laws of the  State  of
Louisiana, with its legal domicile

<PAGE>

in the Parish of Terrebonne,  Louisiana, do hereby certify that the foregoing is
a true and correct copy of the  resolution  unanimously  adopted by the Board of
Directors  of said  corporation  at a meeting  held on  December  12, 2002 which
meeting a quorum was present and voting.

                                /s/ MARY BORDEAUX
                                --------------------------
                                    SECRETARY

ATTEST

KEITH BORDEAUX
------------------
PRESIDENT

<PAGE>

                                   RESOLUTION

         BE IT RESOLVED by the board of Directors of  PETROGEN,  INC.,  thaT its
Vice President Leo Wm.  Kerrigan be and he is hereby  authorized,  empowered and
directed, for and on behalf of  sai9"(pound)brporation,  to effect the following
transaction:

         To execute on behalf of Petrogen,  Inc. an Assignment  and Bill of Sale
         from  Crown  Royalties  of  Louisiana,  Inc.  in the Lease,  Well,  its
         associated  personal  property and any production  specified on Exhibit
         "A" attached to said Assignment and Bill of Sale.

         said act to contain such other terms,  conditions and  stipulations  as
said  officer  might  deem  wise and  expedient  in his  sole  and  uncontrolled
discretion.

         BE IT  FURTHER  RESOLVED  that  the  said Leo Wm.  Kerrigan  is  hereby
authorized to appear  before any Notary Public for the purpose of  executing
act, or other  instruments,  papers or  documents  which might be  necessary  or
proper under the  circumstances,  we hereby approving,  ratifying and confirming
any and all acts  which the said  officer  may do or  perform  by virtue of this
mandate.

                                    ********

         I, Secretary of Petrogen, Inc., do hereby certify that the foregoing is
a true and correct copy of the  resolution  unanimously  adopted by the Board of
Directors of said corporation at

<PAGE>

a meeting held on ______________ 1999, at which meeting a quorum was present and
voting.

                                        -----------------------
                                           SECRETARY

ATTEST:

/s/ LEO WM. KERRIGAN
-----------------------
VICE PRESIDENT

<PAGE>

                                   EXHIBIT "A"

All of Crown Royalties ' Inc's interest in the following  described property and
leases, to-wit:

A.       S. J; HOOPER NO. 1 WELL, BAXTERVILLE FIELD, MARION COUNTY, MISSISSIPPI,
         TOGETHER WITH THE WELLBORE,  CASING,  TUBING, POMPS, PIPES,  PIPELINES,
         TANKS, AND ALL ASSOCIATED PROPERTY AND EQUIPMENT;

B.       LEASES

         1.   Oil,  Gas and  Mineral  Lease dated  February 9, 1943,  from S. J.
              Hooper,  as lessor to Pres  Cochrane,  as lessee,  and recorded in
              Book 161, at page 584, of the Oil and Gas Records in the office of
              the Chancery Clerk of Marion- County, Mississippi;

         2.   Oil,  Gas and  Mineral  Lease  dated  July 7,  1948,  from Carl E.
              Richardson,  as lessor, to Danciger Oil and Refining  Company,  as
              lessee, and recorded in Book 249, at page 111, of said Oil and Gas
              Records;

         3.   Oil,  Gas and  Mineral  Lease  dated  July 7, 1948,  from  Juanita
              Richardson Dion, as lessor,  to Danciger Oil and Refining Company,
              as lessee,  and recorded in Book 249, at page 110, of said Oil and
              Gas Records;

         4.   Oil, Gas and Mineral Lease dated July 7, 1948, from Mrs. Henrietta
              L.  Richardson  Hargrove,  et al, as lessors,  to Danciger Oil and
              Refining  Company,  as lessee,  and  recorded in Book 249, at page
              109, of said Oil and Gas Records;

         5.   Oil,  Gas and  Mineral  Lease  dated  July 7, 1948,  from  Madonna
              Richardson  Miller,  as  lessor,  to  Danciger  Oil  and  Refining
              Company, as lessee? and recorded in Book 249, at page 108, of said
              Oil and Gas Records;

         6.   Oil, Gas and Mineral Lease dated July 7, 1948, from W. V. Tompkins
              and Chas. H.  Tompkins,  as lessors,  to Danciger Oil and Refining
              Company, as lessee, and recorded in Book 249, at page 107, of said
              Oil and Gas Records;

         7.   Oil,  Gas and  Mineral  Lease  dated  July 7, 1948,  from  Juanita
              Richardson Dion, as lessor,  to Danciger Oil and Refining Company,
              as lessee,  and recorded in Book 249, at page 105, of said Oil and
              Gas Records;

<PAGE>

         8.   Oil, Gas and Mineral Lease dated July 7, 1948, from H.C. Rawls, et
              al, as lessors,  to Danciger Oil and Refining Company,  as lessee,
              and  recorded  in Book  249,  at  page  112,  of said  Oil and Gas
              Records;

ONLY INSOFAR, HOWEVER, as the above described leases cover:

              the NE/4 of NE/4,  Section  1,  Township  1 North,  Range 17 West,
              Marion County, Mississippi, containing 40 acres, more or less;

all as amended, ratified and confirmed by the following instruments and by other
instruments:

         1.   Dated  August  31,  1949,  executed  by H. C.  Rawls,  et al,  and
              recorded in Book 261, at page 125, of said Oil and Gas Records;

         2.   Dated August 15, 1949, executed by E. M. Rush, et al, and recorded
              in Book 261, at page 379, of said Oil and Gas Records;

         3.   Dated  August  15,  1949,  executed  by R. A.  Irwin,  et al,  and
              recorded in Book 261, at page 388, of said Oil and Gas Records;
         4.   Dated August 15, 1949, executed by E. M. Rush, et al, and recorded
              in Book 261, at page 553, of said Oil and Gas Records;

         5.   Dated August 12,  1949,  executed by M. V.  Tompkins and Chas.  H.
              Tompkins,  and  recorded in Book 261, at page 388, of said Oil and
              Gas Records;

         6.   Dated August 18, 1949, executed by Evelyn R. Willoby, and recorded
              in Book 268, at page 25, of said Oil and Gas Records;

         7.   Dated August 16, 1949,  executed by Juanita R. Dion,  and recorded
              in Book 268, at page 19, of said Oil and Gas Records;

         8.   Dated September 2, 1949,  executed by Madonna  Richardson  Miller,
              and recorded in Book 268, at page 20, of said Oil and Gas Records;

         9.   Dated  August  12,  1949,  executed  by  Henrietta  L-  Richardson
              Hargrove, et al, and recorded in Book 268, at page 20, of said Oil
              and Gas Records;
1.

<PAGE>

SAID LEASEHOLD ESTATES BEING SUBJECT TO THE FOLLOWING:

         1.   The terms and  conditions of that certain  Contract and Assignment
              of Overriding Royalty dated July 8, 1948, between Danciger Oil and
              Refining Company, as one party and Orval E. Richardson,  et al, as
              the other  party,  and  recorded in Book 245, at page 503, of said
              Oil and Gas Records; and

         2.   That certain Operating  Agreement dated October 15, 1944,  between
              Danciger Oil & Refining Company, as Operator,  and T. S. Stoneman,
              as Non-operator.

C. T. W. DAVIS NO. 1 WELL,  (Salt  water  disposal),  Baxtervxlle  Field,  Lamar
County, Mississippi.

A salt water disposal system, including a well located:

              330 feet  North and 330 feet West of the  Southeast  corner of the
              SW/4 of SW/4,  Section 31, Township 2 North,  Range 16 West, Lamar
              County, Mississippi;

and all equipment, pumps, machinery,  lines, pipelines,  easements and rights of
way now  used in the  operation  of such  system,  said  system  and the  rights
pertaining thereto originally being described in the following instrument:

              Dated  October  18,  1972,  from  Bass  Pecan  Company,  Inc.,  as
              Assignor,  to George  R.  Grim,  Jr.  and L. J.  Wickenhauser,  as
              Assignees, and recorded in Book 5-E, at page 295, of the Land Deed
              Records  in the  office  of the  Chancery  Clerk of Lamar  County,
              Mississippi.

STATE OF MISSISSIPPI
MARION COUNTY

I certify that this  instrument was filed for record at 12:35 o'clock PM, on the
12th day of  January,  2003,  at my office  in  Columbia,  Mississippi,  and was
recorded in Book 1392 page 328 this 12th day of Jan A.D. 2003.

CASS BARNES, CHANCERY CLERK

By:  /s/ BARBARA HAW  DEPUTY CLERK

[SEAL GOES HERE]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00083-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00083-of-00352.parquet"}]]