Document:

[PETROGEN LOGO APPEARS HERE] PETROGEN

                                                                  April 15, 2005

Mr. Barry Lasker
Bazmo Exploration, LLC
1717 St. James Place, Suite 240
Houston, TX  77057
Fax: 713.334.2772

RE:      PARTICIPATION AGREEMENT - EMILY HAWES FIELD
         CALHOUN COUNTY, TEXAS

Dear Mr. Lasker:

         This letter follows our recent discussions concerning the participation
by  Bazmo  Exploration,  LLC  ("Bazmo)"  with  Petrogen  Corp.  ("PETROGEN")  in
development and production of Petrogen's  interest in certain leases  ("LEASES")
within the Emily Hawes Field of Calhoun  County,  Texas,  and shall evidence our
agreement in that regard.  The Leases are described on the list attached to this
letter and marked  Exhibit "A." The area covered by the Leases ("LEASE AREA") is
shown on a plat attached to Exhibit "A."

         When  signed  by  Bazmo,  this  letter  will  be  a  binding  agreement
("AGREEMENT")  between Bazmo and Petrogen  setting out the terms and  conditions
under which Bazmo will  participate  with Petrogen in development and production
of the Leases.

         The terms and conditions of the Agreement are:

     1.   ASSIGNMENT. Within five (5) days of Bazmo's signing of this Agreement,
          Petrogen  will  offer an  assignment  ("ASSIGNMENT")  of the Leases to
          Bazmo.  The Assignment  will be offered  unsigned by Petrogen to allow
          Bazmo to undertake its due diligence, as provided in Section 5 below.

     2.   WORKING INTEREST.  The Assignment will be of a twenty-five  percent of
          eight-eighths  (25% of 8/8)  working  interest in the  Leases,  if the
          Leases cover  one-hundred  percent  (100%) of the minerals  within the
          Lease  Area.  If the  Leases  do not cover  one-hundred  (100%) of the
          minerals  within the Lease Area, then Petrogen shall assign and convey
          to Bazmo so much of its  interest  in the  Leases as will  deliver  to
          Bazmo an  interest  in the Lease  Area (a working  interest)  equal to
          twenty-five  percent  of  eight-eighths  (25% of 8/8),  subject to the
          terms and provisions of this Agreement.

     3.   NET REVENUE INTEREST.  In the Assignment,  the Leases will burdened by
          royalties equal to twenty-two and one-half percent (22.5%),  such that
          Bazmo will own a net revenue interest equal to twenty-five  percent of
          seventy-seven and one-half percent (25% of 77.5%) .

     4.   CASH  PAYMENT.  In exchange for delivery of the signed  Assignment  by
          Petrogen, Bazmo will pay Petrogen $42,680 ("CASH CONSIDERATION").  The
          fully executed and acknowledged Assignment shall be delivered to Bazmo
          contemporaneously  with Bazmo's payment of the Cash  Consideration  to
          Petrogen.

     5.   DUE DILIGENCE. The Assignment will be without warranty of title except
          by, through and under Petrogen. For a period of ten (10) business days
          following delivery of Petrogen's unexecuted Assignment to Bazmo, Bazmo
          may conduct due diligence,  including,  without limitation,  title due
          diligence. During the due diligence period, Bazmo shall have the right
          to review all of Petrogen's contract, lease, title, and correspondence
          files and Petrogen's  well files relating to the Leases.  Should Bazmo
          be unsatisfied  with the outcome of its due  diligence,  it may reject
          Petrogen's  offer  of  the  Assignment,  declining  to  pay  the  Cash

<PAGE>

          Consideration. If Bazmo rejects the Assignment and declines to pay the
          Cash Consideration,  then the parties will have no further obligations
          to each other.  If the  Assignment  is executed and delivered to Bazmo
          and Bazmo has paid  Petrogen  the Cash  Consideration,  Bazmo shall be
          entitled  to  copy  any  or  all  of  the  contract,   lease,   title,
          correspondence and well files of Petrogen that relate to the Leases.

     6.   INITIAL  WELL.  Following  Petrogen's  signing  and  delivery  of  the
          Assignment and Bazmo's payment of the Cash Consideration, Petrogen and
          Bazmo will agree upon a location on the Leases and a spud date for the
          drilling of a well  ("INITIAL  WELL") to test the  Miocene  formation.
          Such  agreement  shall be  memorialized  in a detailed  Authority  for
          Expenditure ("AFE"). Bazmo will pay thirty-three and one-third percent
          of  eight-eighths  (33.33% of 8/8) of the costs for the  Initial  Well
          until it is either  plugged and  abandoned  as a dry hole or completed
          and  producing  into the  tanks or a sales  pipeline  at or above  the
          Miocene  formation.  To the  extent  that costs for the  Initial  Well
          exceed  one-hundred ten percent (110%) of the AFE'd costs,  Bazmo will
          pay  only   twenty-five   percent  (25%)  of  the  costs  that  exceed
          one-hundred  ten percent  (110%) of the costs incurred in drilling and
          completing  the Initial Well.  After the Initial Well,  Bazmo will pay
          its  twenty-five  percent of  eight-eighths  (25% of 8/8) share of all
          operations on the Leases.

     7.   ESCROWED  COSTS.  Thirty (30) days in advance of the  mutually  agreed
          upon spud date for the  Initial  Well,  Bazmo will pay into a mutually
          acceptable independent escrow account one-half of its thirty-three and
          one-third  percent  (33.33%) share of estimated costs, as shown in the
          approved  AFE.  The  remaining  one-half of Bazmo's  thirty-three  and
          one-third  percent (33.33%) share of estimated costs will be paid into
          the  escrow  account  upon the spud date of the  Initial  Well.  Funds
          escrowed  will  only  be  escrowed  under  the  terms  of  a  mutually
          acceptable escrow agreement.

     8.   OPTION TO PARTICIPATE IN FRIO TEST.  Bazmo will have a one-time option
          to participate for up to thirty-three  and one-third  percent (33.33%)
          of the costs to  Casing  Point  (and  retain a  proportionate  working
          interest  as set forth  below) in a well with  Petrogen  (including  a
          deepening  of the Initial Well if it has been  determined  to be a dry
          hole at or above the Miocene formation) on the Leases to test the Frio
          formation at depths  below 7,000 feet TVD.  Should a Frio test well be
          proposed on the Leases,  Bazmo shall have thirty (30) days in which to
          elect to  participate in the Frio test well or opt out of the drilling
          and forfeit its rights below 7,000 feet.

          In proportion to the percentage of twenty-five percent (25%) for which
          Bazmo may  elect not to  participate  in the Frio test  well,  it will
          reassign to Petrogen all of its rights in the Leases below 7,000 feet,
          such  assignment to be made within five (5) days of Bazmo's  election.
          In addition to Bazmo's  interest in the Leases below 7,000 feet,  this
          re-assignment  shall include a like  percentage of any other interests
          below  7,000  feet  that  Bazmo  may  have  acquired  in the  AMI  (as
          subsequently defined) below 7,000 feet.

          If Bazmo elects to participate  in the Frio test,  Bazmo will have the
          election to bear up to thirty-three and one-third  percent (33.33%) of
          the cost to  Casing  Point in the test well (or any  amount  less than
          that  that  Bazmo  elects  to bear) on a  one-third  (1/3) of cost for
          one-fourth (1/4) interest basis,  such that Bazmo would have a working
          interest equal to seventy-five percent (75%) of the cost percentage to
          Casing  Point  that is borne by Bazmo in the Frio  test,  as to depths
          below 7,000 feet below the surface of the earth.  Should the Frio test
          well  be  undertaken  as a  deepening  or  "tail"  to a  well  drilled
          subsequent to the Initial Well, the promote  (i.e.,  Bazmo bearing 1/3
          of costs for a 1/4  interest)  shall only begin after  setting pipe to
          protect the Miocene interval.

          If Bazmo  participates  in the Frio test,  Bazmo will bear costs after
          Casing Point in the Frio test well and in other operations deeper than
          7,000  feet  below  the  surface  of the  earth  equal to the  working
          interest percentage that Bazmo has retained,  calculated in the manner
          set forth  above.  "Casing  Point" for  purposes of this  Agreement is
          understood  to be that  point in time when the Frio test well has been
          drilled to its  objective  depth,  all logging and testing of the well
          has been  completed,  and a decision  must be made either to attempt a
          completion of said well or to abandon said well as a dry hole.

<PAGE>

     9.   OPERATING  AGREEMENT.  Within thirty (30) days of Bazmo's execution of
          this letter,  Petrogen and Bazmo will enter into a mutually acceptable
          joint  operating  agreement  ("JOA") on the AAPL Form  610-1989  Model
          Form, which shall name Petrogen as operator and include provisions for
          fixed rate  administrative  overhead for similar  wells in  accordance
          with the latest survey of such rates published by Ernst & Young,  LLP.
          In the event Bazmo  elects not to  participate  in a Frio test for any
          percentage,  the Operating  Agreement  will be amended to only include
          depths above 7,000 feet.

          If  Bazmo  elects  not  to  participate  in  the  Frio  test  for  any
          percentage,  if proposed, Bazmo agrees to maintain information that it
          has  received  from   Petrogen,   with  respect  to  that   formation,
          confidential  and agrees that it will not compete with Petrogen in any
          manner as to depths  below  7,000 feet below the  surface of the earth
          during the term of this Agreement.

     10.  KNOWLEDGEABLE  INVESTOR.  Bazmo is an  experienced  and  knowledgeable
          investor  and  operator  in the oil and gas  business.  In making  its
          decision to participate in the Leases,  Bazmo has relied solely on its
          own independent investigation, analysis and evaluation.

     11.  SECURITIES  REPRESENTATION.  Bazmo is acquiring the Leases for its own
          account  and not with a view to, or for offer of resale in  connection
          with, a distribution thereof, within the meaning of the Securities Act
          of 1933 and any other  applicable laws pertaining to the  distribution
          of securities.

     12.  ASSIGNABILITY.  This  Agreement  is binding  upon the parties  hereto,
          their  successors and assigns.  Except for  assignments to Affiliates,
          Bazmo shall make no assignment of this  Agreement  without  Petrogen's
          prior  written  consent,  which  consent  shall  not  be  unreasonably
          withheld.

     13.  AREA OF MUTUAL  INTEREST.  Petrogen and Bazmo hereby establish an Area
          of  Mutual  interest  within  the  area  ("AMI")  outlined  on the map
          attached hereto as Exhibit "B." During the term of this Agreement,  if
          either  Petrogen or Bazmo acquire an interest in the rights to explore
          for and produce oil and gas from the AMI (the term  "interest" as used
          herein  shall  include  any  interest  whatsoever  in the oil and gas,
          including but not limited to royalties,  overriding royalties, leases,
          renewals of existing leases, farmins, etc.), the acquiring party shall
          notify the non-acquiring  party, giving complete information as to the
          interest acquired,  along with copies of the instrument or instruments
          by which the interest was acquired,  and the consideration to be given
          or paid.  For a period of thirty (30) days after  receipt of notice of
          acquisition,  the non-acquiring  party shall have the right to acquire
          an  interest  in the  interest  acquired by the  acquiring  party,  by
          notifying  the  acquiring   party  of  its  desire  to  share  in  the
          acquisition, and paying the acquiring party its proportionate share of
          the  consideration  given or assuming its  proportionate  share of the
          obligations assumed.  Thereupon, the acquiring party shall immediately
          execute and deliver the  appropriate  assignment to the  non-acquiring
          party, without covenants of warranty,  except by, through or under the
          acquiring party. If Petrogen is the non-acquiring party, it shall have
          a right to acquire a seventy-five  percent (75%) interest and if Bazmo
          is the  non-acquiring  party it  shall  have the  right to  acquire  a
          twenty-five  percent  (25%)  interest,  such  percentages  subject  to
          adjustment  for  rights  below  7,000  feet  if  Bazmo  elects  not to
          participate in a Frio test well for twenty-five  percent (25%).  Thus,
          for example,  if Bazmo elects to  participate  in a Frio test well for
          five  percent  (5%)  its  right  to  acquire  a  portion  of  Petrogen
          acquisitions  in the AMI below 7,000 feet shall be five  percent  (5%)
          and Petrogen's right to acquire a portion of Bazmo acquisitions in the
          AMI below 7,000 feet shall be ninety-five  percent (95%). Should Bazmo
          decline to participate for any percentage of a Frio test well, the AMI
          would still apply,  but Bazmo's right to acquire a portion of Petrogen
          acquisitions  in the AMI  below  7,000  feet  shall be zero  (-0-) and
          Petrogen's right to acquire a portion of Bazmo acquisitions in the AMI
          below 7,000 feet shall be one-hundred percent (100%).

          Notwithstanding  its  participation or  non-participation  in any Frio
          test well, Bazmo agrees that it will continue to keep confidential all
          information and data related to the Leases and the AMI.

<PAGE>

     14.  LEASING  UNLEASED  MINERALS.  Petrogen agrees that it will endeavor to
          lease all unleased mineral interests in the AMI and the renewal of any
          of the  Leases  that are  likely to expire  during  the next  ________
          (____) months.

     15.  TERM. The term of this Agreement shall be for the longer of so long as
          any of the Leases  (including  any  extensions or renewals)  remain in
          force and effect or the JOA remains in force and effect  according  to
          its terms.

         If this Agreement  meets with your  approval,  please sign the enclosed
duplicate  in  the  space  provided  and  return  it to  the  attention  of  the
undersigned.   Upon  receipt  of  the  signed  Agreement,  Petrogen  will  begin
preparation of the Assignment.

         Unless this  Agreement  is returned to Petrogen  signed by Bazmo before
5:00 PM on May __,  2004,  it  shall be  deemed  withdrawn  and of no force  and
effect.

Very truly yours,

PETROGEN CORP.

Sacha H. Spindler
CEO

                                  AGREED & ACCEPTED, THIS ___ DAY OF
                                  _______ 2004

                                  BAZMO EXPLORATION, LLC

                                  ______________________________________________

                                  Name & title:_________________________________

      Greenway Plaza, 3200 S.W. Freeway, Suite 3300, Houston, Texas, 77027
      Tel: 713-402-6115 / Fax: 713-552-0022 / Toll Free: 1-888-875-1155 /
                          Email: info@petrogencorp.com
                          Website: www.petrogencorp.comEXHIBIT 10-5

                                                c/o Sterling Energy Company
                                                1200 17th Street, Suite 1000
                                                Denver, CO  80202
                                                Phone: (720)946-6105
                                                Fax: (702) 946-6104

SIEIRA GAS CORPORATION

May 8, 2003

Mr. Sacha H. Spindler
Petrogen International LTD

Re: Gas Purchase Proposal, Enos Creek Field - Hot Springs County, Wyoming

Dear Sacha:

Sierra  Gas  Corporation  ("Sierra")  is pleased to  present  this  proposal  to
purchase natural gas from Petrogen  Corporation's  ("Petrogen")  Enos Creek area
operations.

Sierra  registered to do business in the state of Wyoming in 1999 and since then
we have developed multiple gas markets on the Williston Basin Interstate ("WGl")
Pipeline System in conjunction  with our Big Horn Gas Plan  operations.  We also
have a  long-standing  relationship  with WBI and would  maintain an Operational
Balancing  Agreement on WBI for your Enos Creek Production.  We are confident we
can provide you a  consistent  market for all your  natural gas  production  and
creditworthy  customers  who  will  pay  you in  full  within  30  days  of each
production month end.

We propose to  purchase  all of  Petrogen's  Enos Creek area  production  on the
following terms:

1.   PURCHASE PRICE: 90% of Colorado Interstate Gas ("CIG") Rocky Mountain First
     of Month {"FOM") Index Price. Alternatively, if CIG FOM Index market is not
     available  for  all  of the  gas in a  particular  month,  then  90% of the
     Weighted Average Sale Price ("WASP") received by Sierra at the WBI delivery
     point,

2.   GAS SALES VOLUME;  The gas volumes  available for sale under this agreement
     shall  be  reduced  by any  fuel,  lost  and  unaccounted  for gas  volumes
     attributable  to the Wyoming  Gas System and the WS!  System as part of the
     payment calculation,

3.   DELIVERY POINT: Custody of the gas shall pass to Sierra at Petrogen's check
     meter into WGS,  provided  that the volume of gas  available for sale under
     this  Agreement  shall be reduced by any losses on the WGS as determined by
     the WBI Monthly Allocation Statement.

4.   QUALITY;  Petrogen shall deliver gas under this  Agreement  which meets the
     Gas  Quality  Specifications  established  by WGS and WBI for gas on  their
     systems.

5.   QUANTITY;  Petrogen  shall  provide its  projected  gas flow for the coming
     month not later  than 10 days  prior to the Y'1 of the month and shall take
     all  reasonable  steps to produce  its gas on a steady  basis  through  the
     month, subject to FORCE MAJEURE events.

6.   PAYMENTS;  All proceeds  payable  under this  Agreement  shall be paid on a
     gross  basis to Petrogen  on or before the end of the month  following  the
     month of  production.  Petrogen  shall be  responsible  for at!  royalties,
     severance taxes and production payments. All transportation and compression
     fees, measurement and other costs and all fuel lost and unaccounted for

<PAGE>

May 8, 2003
Page 2

     gas  volumes  imposed  by WGS shall be  deducted  prior to  payment  of the
     production proceeds to Petrogcn.

7.   TERM:  The term of this  agreement  shall be for one year  from  first  gas
     deliveries hereunder Thereafter, the term will continue year to year unless
     terminated on written notice from either party  delivered not less than 90
     days prior to the end of the renewal term.

Please  feel to to contact me directly  if you have any  questions  or wish to
discuss these terms further. If the terms above are generally acceptable, please
sign below and we will prepare a formal Gas Purchase  Agreement  for your review
and execution.

Sincerely,

/s/ WILLIAM H. PENNEY

WILLIAM H. PENNEY, PRESIDENT
SfERRA GAS CORPORATION

AGREED AND ACCEPTED BY PETROGEN

BY:  /s/ SACHA SPINDLER
---------------------------------------
TITLE:  PRESIDENT, CEO

DATE:  05/09/03

ESTIMATED INITIAL GAS FLOW:

Date:   TBA     Volume:  500 mefqd

cc: Robert B. Sanders

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