Document:

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                                                                    EXHIBIT 10.2

                              MANAGEMENT AGREEMENT

      THIS MANAGEMENT AGREEMENT (the "Agreement") is made as of the _____ day of
___________, 2005 by and between Ensource Energy Partners LP, a Delaware limited
partnership ("EEP"), and Ensource Energy Company LLC, a Delaware limited
liability company ("Manager").

                                    RECITALS:

      WHEREAS, subject to the terms hereof, EEP desires to engage Manager, and
Manager desires to be engaged, to (i) manage EEP's assets and Business, (ii)
provide or cause to be provided the reports and other information described
herein relating EEP's assets and Business, and (iii) provide the other services
described herein.

      NOW, THEREFORE, in consideration of the mutual covenants herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto (each, a "Party" and together, the "Parties")
agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

      1.1 Defined Terms. Capitalized terms used in this Agreement shall have the
meanings ascribed to them in this Section 1.1 or otherwise throughout this
Agreement regardless of whether such terms appear before or after the place
where they are defined.

      "Agreement" means this Agreement, as it may be amended from time to time.

      "Affiliate" means, with respect to a Person, any other Person controlling,
controlled by or under common control with such Person.

      "Board" means the Board of Directors of EEP.

      "Business" means the operation of EEP's business, including acting as the
general partner of the Fund and the sole member of Ensource Reserves Management
LLC, in each case as now or hereafter conducted.

      "Business Day" means any day that is not a Saturday, Sunday or day on
which banks are authorized by law to close in the State of Texas.

      "Confidential Information" means all information furnished to Manager or
its representatives by or on behalf of EEP or the Fund or created or developed
by Manager or its representatives relating to the Business or assets of EEP or
the Fund (irrespective of the form of communication and whether such information
is furnished before, on or after the date hereof), and all analyses,
compilations, data, studies, notes, interpretations, memoranda or other
documents prepared by Manager or its representatives containing or based in
whole or in part on any such furnished information.

      "EEP" means Ensource Energy Partners LP.

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      "Fiscal Year" means the fiscal year of EEP for US GAAP purposes.

      "Fund" means Ensource Energy Income Fund LP.

      "Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.

      "LP Agreement" means the Amended and Restated Agreement of Limited
Partnership of Ensource Energy Partners LP dated as of ____________, 2005, as
amended from time to time.

      "Manager" has the meaning set forth in the above preamble.

      "Management Fee" means the sum of $50,000 payable to Manager pursuant to
the terms and conditions of this Agreement.

      "Material Decisions" has the meaning provided in Section 3.2.

      "Permits" means licenses, permits, variances, exemptions, orders,
franchises, approvals and other authorizations of or from any Governmental
Authority.

      "Person" means any individual, corporation, partnership, business trust,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.

      "Proceedings" means all proceedings, actions, claims, suits and notices of
investigations by or before any arbitrator or Governmental Authority.

      "Services" means the services and items provided (or to be provided) by
Manager pursuant to this Agreement.

      "Taxes" means any and all foreign, federal, state, local and municipal
taxes, including ad valorem, property, gross receipts, sales, use, excise,
transaction, import duties and charges, customs broker fees and other costs of
importation, non-U.S. value-added taxes, other non-U.S. taxes or charges, or
increases in any of the foregoing, now existing or otherwise applicable, on any
item or service that is the subject of this Agreement, other than taxes (whether
foreign, federal, state, local or municipal) based on net income, net worth,
capital or profit.

      "Third Party" means any Person other than Manager or EEP or any of their
respective Affiliates.

      "US GAAP" means those generally accepted accounting principles and
practices that are recognized as such by the Financial Accounting Standards
Board (or any generally recognized successor).

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      1.2 Other Definitions. Any capitalized term used but not defined herein
shall have the meaning given the term in the LP Agreement. Words not otherwise
defined herein (or by reference to the LP Agreement) that have well-known and
generally accepted technical or trade meanings in the oil and gas industry are
used herein in accordance with such recognized meanings.

      1.3 Construction. As used in this Agreement, unless expressly stated
otherwise, references to "includes" and its derivatives mean "includes, but is
not limited to," and corresponding derivative expressions. Unless otherwise
specified, all references in this Agreement to "Sections" and "Exhibits" are
references to the corresponding sections in and exhibits attached to this
Agreement; all such exhibits are incorporated herein by reference.

                                   ARTICLE II
                                MANAGER SERVICES

      2.1 Services to be provided by Manager. For and in consideration of the
Management Fee and other consideration as set forth herein, Manager shall
perform all management and administrative services as may be required by EEP for
the reasonable conduct of the Business as hereafter conducted, including the
following:

            (a) General Administration and Management. Manager will provide, or
will contract with Third Parties to provide, in accordance with the Annual
Budget (or other express authorization(s) of the Board): (i) management and
contract administration services in connection with the administration of EEP,
including in its role as general partner of the Fund, (ii) contract
administration services regarding contracts and agreements of EEP, and
management supervision of contractors and vendors of EEP, relating to the
operation of the Business, (iii) management services comprised of reviewing,
approving and paying authorized expenditures and all costs associated with
operating the Business, and (iv) management of the personnel needs, and
administration of any employment and consulting contracts, for any employees and
consultants of EEP or the Fund.

            (b) Accounting Services. Manager shall provide (or, subject to the
other terms of this Agreement, will contract with a Third Party to provide)
financial, revenue and expense accounting services relating to the Business
(collectively, "Accounting Services"), including the following:

                  (i) On or before 45 days after the end of every calendar
               month, Manager shall prepare a settlement statement for EEP
               indicating all cash, checks or other proceeds received and
               expenses during the previous calendar month. All remittances
               shall be deposited into, and all expenses shall be paid from, the
               appropriate bank accounts of EEP, as such bank accounts may be
               designated by EEP from time to time.

                  (ii) Manager shall prepare and file on behalf of EEP and the
               Fund applicable reporting and filing requirements of Governmental
               Authorities;

                  (iii) Manager shall perform expenditure accounting functions,
               including arranging EEP's payment of invoices;

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                  (iv) Within 45 days after the end of each month, Manager shall
               prepare a hedging report showing the Fund's hedging positions as
               of the last day of such month, and forecasting the projected
               amount of production that is hedged for the one-year period
               following the date of such report; and

                  (v) To the extent EEP or the Fund hires any employees, Manager
               shall perform, or cause to be performed, all payroll and
               employment benefit requirements with respect to any of EEP's or
               the Fund's employees.

            (c) Risk Management. Manager, subject to the other terms of this
Agreement, shall arrange for the benefit of EEP and the Fund insurance coverage
in accordance with EEP's risk management policies as established from time to
time by the Board or as required by EEP's or the Fund's contractual obligations.

            (d) Purchasing. Manager, subject to the other terms of this
Agreement, shall arrange for the procurement of equipment, supplies and other
goods and services reasonably necessary for the efficient day to day operation
of the Business.

            (e) Compliance. Manager shall provide (or, subject to the other
terms of this Agreement, arrange to be provided) services relating to regulatory
compliance, including arranging the application for, maintenance of and
compliance with all required Permits with respect to the Business; preparation
and filing of all applications, reports, notices and other regulatory filings or
reports required by any Governmental Authority; and participation in hearings
and other administrative Proceedings on behalf of EEP.

            (f) Reporting to EEP. Manager shall prepare and submit (or, subject
to the other terms of this Agreement, arrange to be provided) to the Board the
following information and reports:

                  (i) Annual Budget and Operating Plan. On or before each
               December 15th during the term of this Agreement with respect to
               the next, entire Fiscal Year (e.g., on or before December 15,
               2005, with respect to the next entire Fiscal Year commencing on
               January 1, 2006), Manager will prepare for the consideration and
               adoption of the Board a proposed annual operating budget, and
               shall from time to time propose such amendments thereof as the
               Manager deems necessary and appropriate (collectively, the
               "Annual Budget"). Such Annual Budget shall set forth on a monthly
               basis the estimated receipts and expenditures of EEP in
               sufficient detail to provide an estimate of net income, taxable
               income, cash flow and other financial requirements of EEP for
               such year. The general and administrative expense estimates of
               such Annual Budget will be provided separately and broken out in
               detail in line item format. Each Annual Budget shall also include
               such other information or other matters reasonably necessary in
               order to enable the Board to make an informed decision with
               respect to approval of such Annual Budget. Following any fiscal
               quarter, the Manager may propose changes to any Annual Budget (or
               any line item therein) previously submitted to the

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               Board, and the Board will consider any such proposed changes at
               the its next scheduled meeting.

                  (ii) Quarterly Financial Statements. Within 30 days after the
               end of each fiscal quarter, Manager will provide the Board with a
               balance sheet, income statement and cash statement for the
               current month and year-to-date setting forth the actual results
               for the periods presented together with a comparison to the
               respective amounts in the Annual Budget. Except as the Manager
               and the Board may otherwise agree, such financial statements
               shall be prepared in accordance with US GAAP other than footnotes
               and subject to year-end audit adjustments, and shall contain a
               detailed narrative description of variances to the Annual Budget.

                  (iii) Audited Financial Statements. Manager will cause to be
               prepared and will furnish to the Board within 90 days after the
               end of each Fiscal Year (commencing with the Fiscal Year ending
               December 31, 2005), an audited balance sheet, audited income
               statement and audited statement of cash flows, all prepared in
               accordance with US GAAP, together with an audit opinion from a
               nationally recognized accounting firm that, to the extent
               reasonably within the Manager's control, is unqualified; and such
               report and opinion shall also include, on an audited basis (to
               the extent the same can be practicably obtained from the auditor)
               or on an unaudited basis (to the extent the same cannot be
               practicably obtained from the auditor), a statement of changes in
               the limited partners' equity in EEP.

                  (iv) Forecasted Distributions. Within 45 days after the end of
               each fiscal quarter, Manager will furnish a forecast of the cash
               distributions payable by the Fund to EEP in respect of any common
               or subordinated units EEP may hold and the incentive distribution
               rights payable to EEP as the general partner of the Fund, in each
               case for the remainder of the Fiscal Year.

                  (v) Income Tax Returns. The Manager shall use its best efforts
               to cause to be prepared federal and required state income tax
               returns to be filed by EEP within 75 days after the end of a
               Fiscal Year. Contemporaneously with filing by EEP, Manager shall
               distribute copies of such returns and Schedule K-1 (or similar
               state schedule) to the partners of EEP.

                  (vi) Other reports. The Manager shall provide the Board with
               copies of (i) all material reports delivered to EEP and (ii) all
               material information related to any pending or, to the knowledge
               of Manager, threatened Proceedings, insurance or required
               permits, together with such other reports and information
               relating to the Business or the Services as the Board may
               reasonably request, to the extent such information is in the
               possession of Manager or can be readily obtained by Manager
               without undue effort or unreimbursed expense.

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                  (vii) Meetings. At each meeting of the Board, Manager will
               provide information relevant to (a) any Material Decision,
               together with Manager's recommendation with respect thereto and
               reasons therefor, and a summary of actions taken pursuant to
               Material Decisions since the preceding meeting of the Board, (b)
               any material Proceedings that are pending or, to the knowledge of
               Manager, threatened against EEP in connection with the Business
               and (c) any other material developments with respect to the
               Business.

            (g) Maintenance of Books and Records. Manager shall maintain the
books and records of EEP and the Fund. Manager agrees to retain all such books
and records in accordance with all reasonable records retention policies that
may from time to time be adopted by EEP.

      2.2 Affect on the LP Agreement. Nothing in this Agreement shall be deemed
to modify the LP Agreement, affect any of EEP's obligations under the LP
Agreement, or affect the standard to which EEP is held in performing its
obligations under the LP Agreement. In connection with the performance of this
Agreement, Manager shall not take any action that would be prohibited or would
otherwise require the approval of the Board under the LP Agreement.

      2.3 EEP Information. It is contemplated that during the term of this
Agreement, (a) EEP will be required to provide certain notices, information and
data necessary for Manager to perform the Services and its obligations under
this Agreement, and (b) one or more of the officers or individual members of
Manager would also be an officer of EEP or a member of the Board, and would be
involved in collecting or providing to Manager certain notices, information and
data necessary for Manager to perform the Services and its obligations under
this Agreement. However, if there is a time during the term of this Agreement
when none of the officers or individual members of Manager are officers of EEP,
or a member of the Board, then, for such period, Manager shall be permitted to
rely on any information or data provided by EEP to Manager in connection with
the performance of its duties and provision of Services under this Agreement,
except to the extent that Manager has actual knowledge that such information or
data is inaccurate or incomplete.

                                   ARTICLE III
                           MATTERS RESERVED TO COMPANY

      3.1 Execution of Contracts. Manager is an independent contractor of EEP.
Subject to the other terms and provisions of this Agreement, Manager may enter
into subcontracts with service providers in connection with the performance of
its obligations hereunder. Manager is authorized hereunder to execute contracts,
assignments, certificates, applications, authorizations, regulatory filings or
any other documents or instruments in EEP's name.

      3.2 Further Restrictions. Manager shall not undertake any of the following
actions (each a "Material Decision") with respect to the Business without the
prior approval of the Board:

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            (a) Entering into any contract, or incurring any other expense or
liability, for which Manager will seek reimbursement or payment from EEP (or
arranging for any contract or agreement to be entered into by EEP), (i) with a
term of greater than 36 months that is not included in, and even if within the
Annual Budget within the economic parameters so reflected in, such Annual Budget
or other express authority granted Manager by the Board, or (ii) involves the
incurrence of an obligation or liability by (or for the expense of) EEP or the
Fund in excess of, individually, $1,000,000, or, in the aggregate, $5,000,000,
unless otherwise previously approved by the Board or permitted in the LP
Agreement (and such $5,000,000 amount shall be in the aggregate, taking into
account all other contracts, expenses or liabilities not otherwise expressly
approved by the Board or in the Annual Budget). Any expenses or liabilities
incurred by Manager in violation of this Agreement shall be incurred at
Manager's sole risk and liability.

            (b) Any other actions or restrictions identified or imposed, from
time to time, by the Board.

                                   ARTICLE IV
                                STANDARD OF CARE

      4.1 Standard of Care. Manager shall perform the Services in a good, safe
and workmanlike manner, with due diligence and dispatch, in accordance with good
business practice and in compliance with applicable laws, regulations,
contracts, leases, orders, security instruments and other agreements to which
EEP or the Fund is a party or by which EEP or the Fund or any of their
respective assets are bound; but in no event shall it have any liability as
Manager to EEP for losses sustained or liabilities incurred except such as may
result from gross negligence or willful misconduct.

      4.2 Procurement of Goods and Services. To the extent that Manager arranges
contracts with Third Parties for goods and services in connection with the
operation of the Business, Manager shall use commercially reasonable efforts (i)
to obtain such goods and services at rates competitive with those otherwise
generally available in the area in which services or materials are to be
furnished; and (ii) to obtain from such Third Parties such customary best
warranties and guarantees as may be reasonably required with respect to the
goods and services so furnished.

      4.3 Protection from Liens. Manager shall not permit any liens,
encumbrances or charges upon any of the assets of EEP or the Fund arising from
the provision of Services or materials under this Agreement except as approved,
or consented to, by the Board.

      4.4 Commingling of Assets. Manager shall separately maintain and not
commingle the assets of EEP or the Fund with those of Manager.

      4.5 Insurance. Manager shall obtain and maintain during the term of this
Agreement, from insurers who are reliable and acceptable to EEP and authorized
to do business in the state or states or jurisdictions in which Services are to
be performed by Manager, insurance coverages in the types and minimum limits set
forth on Exhibit A attached hereto. Manager agrees to provide the Board with
certificates of insurance evidencing such insurance coverage and, upon request
of the Board, shall furnish copies of such policies. Except with respect to
workers'

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compensation coverage, the policies shall name EEP as an additional insured and
shall contain waivers by the insurers of any and all rights of subrogation to
pursue any claims or causes of action against EEP. The policies shall provide
that they will not be cancelled or reduced without giving EEP at least 10 days'
prior written notice of such cancellation or reduction.

      4.6 Intellectual Property Rights. If Manager uses intellectual property
owned by Third Parties in the performance of the Services, Manager shall obtain
and maintain any such licenses and authorizations necessary to authorize its use
of such intellectual property in connection with the Services.

                                    ARTICLE V
                 MANAGER'S COMPENSATION; CONTINUING OBLIGATIONS

      5.1 Management Fee; Continuing Obligations. On the first Business Day of
the second calendar month following each calendar month during the term hereof
commencing on _______, 2005, EEP shall pay Manager, in cash, the Management Fee
as a fee for Services rendered hereunder.

      5.2 Other Expenditures. Manager's general and administrative costs and
similar overhead costs that are incurred by Manager in performing Services
hereunder shall be charged to EEP without mark-up, interest or other profit to
Manager.

      5.3 Cash Advances. On or before the 15th day of each calendar month,
Manager may elect to receive a cash advance from EEP to cover the estimated
costs of Manager in the following month with respect to the performance of
Services. In the event actual expenditures are less than the amount advanced by
EEP, Manager shall apply any excess advance to the following month's estimated
expenditures. If the actual expenditures are more than the amount advanced by
EEP, Manager shall include (and EEP shall advance) any excess expenses on the
following month's estimated expenditures.

      5.4 No Set-Off. All payments, including the Management Fee earned and
payable in accordance this Agreement, shall be made without deduction whether on
account of set-off or otherwise.

      5.5 Taxes. EEP shall be responsible for all applicable Taxes levied on
items, goods or services that are sold, purchased or obtained pursuant to this
Agreement, including the Services, except for Taxes (whether foreign, federal,
state, local or municipal taxes) imposed on the net income, net worth, capital
or profits of Manager.

                                   ARTICLE VI
                          INDEMNIFICATION; LIMITATIONS

      6.1 Indemnification by Manager.

            (a) Employees, Agents and Representatives of Manager. Manager hereby
agrees to DEFEND, INDEMNIFY AND HOLD HARMLESS EEP and the Fund and their
respective officers, managers, members, directors, employees, agents and
Affiliates (collectively, the "EEP Indemnitees") from any and all threatened or
actual claims, demands, causes of action,

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suits, proceedings, losses, damages, fines, penalties, liabilities, costs and
expenses of any nature, including attorneys' fees and court costs (collectively,
"Liabilities"), sustained by, incurred by, arising in favor of or asserted by
any employees, agents and representatives of Manager, or any contractors or
subcontractors of Manager, in any way relating to the performance of Services
hereunder (including any claims for personal injury, property loss or damage,
bodily injury, illness or death).

            (b) Manager's own Property. Manager hereby agrees to RELEASE,
DEFEND, INDEMNIFY AND HOLD HARMLESS each member of EEP Indemnitees from any and
all Liabilities sustained or incurred by Manager with respect to any damage to
or loss of Manager's property, whether real, personal or mixed property, in any
way relating to the performance of Services hereunder.

            (c) Other EEP and Third Party Claims. In addition to the indemnities
in Section 6.1(a) and Section 6.1(b), Manager hereby agrees to DEFEND, INDEMNIFY
AND HOLD HARMLESS each of the EEP Indemnitees from any and all Liabilities
sustained or incurred by any of EEP Indemnitees or asserted against any of EEP
Indemnitees by Third Parties, in any way relating to the performance of
Services, to the extent, and only to the extent, such Liabilities are finally
judicially determined not to be the result of (i) the gross negligence or
willful misconduct of EEP or such EEP Indemnitee or (ii) the breach of this
Agreement.

      6.2 Indemnification by EEP.

            (a) Employees, Agents and Representatives of EEP. EEP hereby agrees
to DEFEND, INDEMNIFY AND HOLD HARMLESS Manager and its respective officers,
managers, members, employees, agents and Affiliates (collectively, the "Manager
Indemnitees") from any and all Liabilities sustained by, incurred by, arising in
favor of or asserted by any employees, agents and representatives of EEP or the
Fund, in any way relating to the performance of Services hereunder (including
any claims for personal injury, property loss or damage, bodily injury, illness
or death); provided, however, that for purposes hereof, "employees, agents and
representatives of EEP" shall not include Manager, any employees, agents or
representatives of Manager or any other member of the Manager Indemnitees.

            (b) Other Third Party Claims. Subject to the provisions and
indemnities set forth in Sections 6.1, EEP hereby agrees to DEFEND, INDEMNIFY
AND HOLD HARMLESS Manager Indemnitees from any and all Liabilities sustained or
incurred by or asserted against the Manager Indemnitees by Third Parties (other
than by Affiliates of Manager Indemnitees) in connection with the performance of
Services, to the extent, and only to the extent that, such Liabilities are
finally judicially determined to result from (i) the gross negligence or willful
misconduct of EEP or the Fund or (ii) the breach of this Agreement.

      6.3 Negligence; Strict Liability. THE RELEASE, DEFENSE AND INDEMNITY
OBLIGATIONS IN SECTIONS 6.1 AND SECTION 6.2 SHALL APPLY REGARDLESS OF CAUSE OR
OF ANY NEGLIGENT ACTS OR OMISSIONS (INCLUDING SOLE NEGLIGENCE, CONCURRENT
NEGLIGENCE OR STRICT LIABILITY), BREACH OF DUTY (STATUTORY OR OTHERWISE),
VIOLATION OF LAW OR OTHER FAULT OF ANY INDEMNIFIED PARTY, OR ANY PRE-EXISTING
DEFECT; PROVIDED,

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HOWEVER, THAT THIS PROVISION SHALL IN NO WAY LIMIT OR ALTER ANY QUALIFICATIONS
SET FORTH IN SUCH RELEASE, DEFENSE AND INDEMNITY OBLIGATIONS EXPRESSLY RELATING
TO GROSS NEGLIGENCE, INTENTIONAL MISCONDUCT OR BREACH OF THIS AGREEMENT. BOTH
PARTIES AGREE THAT THIS STATEMENT COMPLIES WITH THE REQUIREMENT KNOWN AS THE
`EXPRESS NEGLIGENCE RULE' TO EXPRESSLY STATE IN A CONSPICUOUS MANNER AND TO
AFFORD FAIR AND ADEQUATE NOTICE THAT THIS SECTION HAS PROVISIONS REQUIRING ONE
PARTY TO BE RESPONSIBLE FOR THE NEGLIGENCE, STRICT LIABILITY, OR OTHER FAULT OF
ANOTHER PARTY.

      6.4 Limitations of Liability.

            (a) MANAGER SHALL NOT BE LIABLE OR RESPONSIBLE HEREUNDER FOR BREACH
OF WARRANTY OR STANDARD OF PERFORMANCE WITH RESPECT TO THE PROVISION OF
SERVICES, OR ACCOUNTABLE IN DAMAGES OF ANY KIND TO EEP WITH RESPECT THERETO: (I)
FOR ANY ACT, OR OMISSION PERFORMED OR OMITTED BY MANAGER IN GOOD FAITH AND IN A
MANNER REASONABLY BELIEVED BY MANAGER TO BE WITHIN THE SCOPE OF THIS AGREEMENT
AND IN THE BEST INTERESTS OF EEP, OR (II) FOR A FAILURE OR INABILITY TO ACT IN
RENDERING THE SERVICES DUE SOLELY TO A FAILURE OR NON-PERFORMANCE BY EEP;
PROVIDED, HOWEVER, THAT SUCH DAMAGES IN SUBSECTIONS (I) OR (II) DO NOT ARISE
FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF MANAGER OR FROM A BREACH OF
THIS AGREEMENT BY MANAGER.

            (b) NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN CONTAINED, THE
AGGREGATE LIABILITY OF MANAGER ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT AND THE PERFORMANCE OR NON-PERFORMANCE THEREOF, WHETHER BASED ON
CONTRACT, INDEMNITY, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE,
SHALL IN NO EVENT EXCEED THE AMOUNT OF THE MANAGEMENT FEES PAID TO MANAGER
DURING THE PREVIOUS TWELVE (12) MONTHS PROVIDED, HOWEVER, THAT THIS LIMITATION
OF LIABILITY SHALL NOT APPLY (A) TO THE EXTENT ATTRIBUTABLE TO MANAGER'S (OR ANY
OF MANAGER INDEMNITEES') FRAUD OR INTENTIONAL MISCONDUCT, OR (B) WITH RESPECT TO
THE INDEMNITIES PROVIDED IN SECTION 6.1.

      6.5 Limitations of Damages and Waiver of Damages. IN CONNECTION WITH ANY
BREACH OF THIS AGREEMENT, NO PARTY AND NONE OF THEIR AFFILIATES, OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, MEMBERS, SHAREHOLDERS, PARTNERS OR REPRESENTATIVES
SHALL BE LIABLE FOR ANY CONSEQUENTIAL OR INDIRECT LOSS OR DAMAGE OF THE
NON-BREACHING PARTY, INCLUDING LOSS OF REVENUES, COST OF CAPITAL, LOSS OF
GOODWILL, INCREASED OPERATING COSTS, DELAY COSTS OR ANY OTHER SPECIAL OR
PUNITIVE DAMAGES OF THE NON-BREACHING PARTY. THE PARTIES FURTHER AGREE THAT THE
WAIVERS AND DISCLAIMERS OF LIABILITY, RELEASES FROM LIABILITY AND LIMITATIONS ON
LIABILITY EXPRESSED IN THIS AGREEMENT SHALL SURVIVE

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TERMINATION OR EXPIRATION OF THIS AGREEMENT, AND SHALL APPLY WHETHER CLAIMS
ARISE IN CONTRACT, EQUITY, TORT OR OTHERWISE, EVEN IN THE EVENT OF THE FAULT,
NEGLIGENCE, INCLUDING SOLE NEGLIGENCE, STRICT LIABILITY OR BREACH OF THE PARTY
RELEASED OR WHOSE LIABILITIES ARE LIMITED.

      6.6 No Warranties or Guarantees. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, NEITHER PARTY MAKES ANY WARRANTIES OR GUARANTEES TO THE OTHER, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO THE SERVICES OR ANY OTHER SUBJECT MATTER OF
THIS AGREEMENT, AND THE PARTIES DISCLAIM AND WAIVE ANY IMPLIED WARRANTIES OR
WARRANTIES IMPOSED BY APPLICABLE LAW, INCLUDING IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

      6.7 Anti-Indemnity. IN THE EVENT THIS AGREEMENT IS SUBJECT TO THE
INDEMNITY LIMITATIONS IN CHAPTER 127 OF THE TEXAS CIVIL PRACTICE AND REMEDIES
CODE (OR ANY SUCCESSOR STATUTE), AND SO LONG AS SUCH LIMITATIONS ARE IN FORCE
DURING THE TERM OF THIS AGREEMENT, EACH PARTY COVENANTS AND AGREES TO SUPPORT
THE MUTUAL INDEMNITY AND RELEASE OBLIGATIONS CONTAINED IN SECTION 6.1 AND
SECTION 6.2, BY CARRYING DURING THE TERM OF THIS AGREEMENT NOT LESS THAN THE
MINIMUM LIMITS AND TYPES OF INSURANCE (OR QUALIFIED SELF-INSURANCE) SPECIFIED IN
SECTION 4.5; PROVIDED, HOWEVER, THAT NOTHING HEREIN SHALL REQUIRE EEP TO OBTAIN
OR MAINTAIN WORKERS COMPENSATION OR SIMILAR INSURANCE TO THE EXTENT EEP HAS NO
EMPLOYEES.

      6.8 Survival. The provisions of this Article VI shall survive the
termination of this Agreement.

                                   ARTICLE VII
                                 CONFIDENTIALITY

      Manager shall maintain the confidentiality of all Confidential Information
with respect to EEP, the Fund and the Business; provided, however, that Manager
may disclose such Confidential Information (i) in any judicial or alternative
dispute resolution Proceeding to resolve disputes between EEP and Manager
arising hereunder; (ii) to the extent disclosure is legally required under
applicable laws (including applicable securities and tax laws) or any agreement
to which EEP is a party or by which it is bound; provided, however, that prior
to making any legally required disclosures in any judicial, regulatory or
dispute resolution Proceeding, Manager shall, if so advised by counsel, seek a
protective order or other relief to prevent or reduce the scope of such
disclosure; and (iii) to EEP's or the Fund's existing or potential lenders,
investors, joint interest owners, purchasers or other parties with whom EEP or
the Fund may enter into contractual relationships, to the extent deemed by
Manager to be reasonably necessary or desirable to enable it to perform the
Services; provided, however, that Manager shall require such Third Parties to
agree to maintain the confidentiality of the Confidential Information so
disclosed; and (iv) if authorized by the Board. Manager acknowledges that the
Confidential Information is being furnished to Manager for the sole and

                                      -11-

<PAGE>

exclusive purpose of enabling it to perform the Services, and the Confidential
Information may not be used by it for any other purpose. The provisions of this
Article VII shall survive the termination of this Agreement.

                                  ARTICLE VIII
                              TERM AND TERMINATION

      8.1 Term.

            (a) Unless sooner terminated in accordance with the provisions of
Section 8.1(b), this Agreement shall remain in force and effect for an initial
term ending on December 31, 2010 (the "Initial Term"), and shall continue on a
year-to-year basis after that unless terminated by either Party by written
notice delivered to the other Party at least 60 days prior to the end of the
Initial Term or any such year, as the case may be.

            (b) Notwithstanding anything stated herein to the contrary, this
Agreement may be terminated at any time prior to the expiration of the Initial
Term, or, as the case may be, prior to the expiration of any applicable annual
term thereafter, upon any of the following:

                  (i) upon mutual agreement of the Parties; or

                  (ii) By EEP at its election upon the occurrence of any of the
            following:

                        (A) Manager's gross negligence or willful misconduct in
                  the performance of the Services; or

                        (B) Manager's material breach of this Agreement, if such
                  (I)breach is not remedied within 60 days after Manager's
                  receipt of EEP's written notice thereof, or such longer period
                  as is reasonably required to cure such breach, provided that
                  Manager commences to cure such breach within such 60-day
                  period and proceeds with due diligence to cure such breach and
                  (II) such breach is continuing at the time notice of
                  termination is delivered to Manager; or

                        (C) the conviction of Manager or any chairman,
                  vice-chairman, president, chief executive officer, chief
                  operating officer, chief financial officer, senior vice
                  president or other senior executive officer of Manager of any
                  felony; or

                        (D) Manager's undertaking of material activities with
                  respect to the Business that are not authorized by the Board
                  or Manager's disregard of the Board's lawful written
                  instructions which undertaking or disregard continues unabated
                  for 30 days after Manager's receipt of written notice thereof
                  from the Board and is continuing at the time notice of
                  termination is delivered to Manager; or

                                      -12-

<PAGE>

                        (E) the sale of all or substantially all of the assets
                  of EEP, either in a single transaction or series of
                  transactions, or a winding-up of the Business; or

                        (F) EEP's receipt of written notice from the majority in
                  interest of the ownership of EEP in the event cash
                  distributions paid by Ensource Energy Income Fund LP to both
                  common and any subordinated unitholders are less than $0.50
                  per unit per calendar quarter for 8 successive calendar
                  quarters (subject to appropriate adjustment for any split,
                  combination or similar transaction in respect of the common or
                  subordinated units); or

                  (iii) By Manager at its election upon:

                        (A) EEP's material breach of this Agreement, if (I) such
                  breach is not remedied within 60 days after the Board's
                  receipt of Manager's written notice thereof, or such longer
                  period as is reasonably required to cure such breach, provided
                  that EEP commences to cure such breach within such 60-day
                  period and proceeds with due diligence to cure such breach and
                  (II) such breach is continuing at the time notice of
                  termination is delivered to EEP; or

                        (B) Manager ceasing to own any ownership interests in
                  EEP.

      8.2 Post-Termination Transition. Upon termination of this Agreement,
Manager will:

            (a) provide to a successor Manager designated by EEP all original
files and records in Manager's possession or under Manager's control relating to
the Services rendered by Manager hereunder, excluding, however, employee records
(provided that Manager may retain a duplicate of files and records furnished to
such successor Manager);

            (b) to the extent assignable, assign to EEP or its designee all
permits and licenses, if any, held by Manager on behalf of EEP that are
necessary or desirable for the continued operation of the Business in the manner
in which it was operated upon termination of this Agreement;

            (c) cooperate with EEP's transfer of the management of the Business
in the manner provided under this Agreement and execute such instruments and
take such further action as EEP may reasonably request to transfer the same; and

            (d) at EEP's request, provide transition services for up to 90 days
after termination of this Agreement in order to facilitate the transfer of
operations of the Business to a new operator designated by EEP; provided,
however, that during such transition period, EEP shall continue to pay Manager
the Management Fee, prorated to the number of days of transition services
provided by Manager and continue to reimburse Manager, as provided in Section
5.3, for costs and expenses incurred by Manager in connection with transition
services.

                                      -13-

<PAGE>

                                   ARTICLE IX
                       AUDIT RIGHTS AND DISPUTE RESOLUTION

      9.1 Audit Rights. At any time during the term of this Agreement, the Board
shall have the right to review and, at EEP's expense, to copy the books and
records maintained by Manager relating to the Business. In addition, to the
extent necessary to verify the performance by Manager of its obligations under
this Agreement, the Board shall have the right, at EEP's expense, to audit,
examine and make copies of or extracts from the books and records of Manager
(the "Audit Right"). The Board may exercise the Audit Right through such
auditors as the Board may determine in its sole discretion. The Board shall (i)
exercise the Audit Right only upon reasonable notice to Manager and (ii) use
reasonable efforts to conduct the Audit Right in such a manner as to minimize
the inconvenience and disruption to Manager.

      9.2 Dispute Resolution. The Parties shall use the dispute resolution
procedures set forth in Exhibit B to resolve in good faith any dispute,
controversy or claim related to this Agreement, including any dispute over the
payment of indemnification pursuant to the provisions of Article VI.

                                    ARTICLE X
                            MISCELLANEOUS PROVISIONS

      10.1 Notices. All notices or advices required or permitted to be given by
or pursuant to this Agreement, shall be given in writing. All such notices and
advices shall be (i) delivered personally, (ii) delivered by facsimile or
delivered by U.S. registered or certified mail, return receipt requested mail,
or (iii) delivered for overnight delivery by a nationally recognized overnight
courier service. Such notices and advices shall be deemed to have been given (i)
on the date of delivery if delivered personally or by facsimile, (ii) on the
third Business Day following the date of mailing if mailed by U.S. registered or
certified mail, return receipt requested, or (iii) on the date of receipt if
delivered for overnight delivery by a nationally recognized overnight courier
service. All such notices and advices and all other communications related to
this Agreement shall be given as follows:

            If to EEP:

            Ensource Energy Partners LP
            7500 San Felipe, Suite 440
            Houston, Texas 77063
            Telephone: 713-659-1794
            Fax: 713-659-1799

            If to MANAGER:

            Ensource Energy Company LLC
            7500 San Felipe, Suite 440
            Houston, Texas 77063
            Attn: President
            Telephone: 713-659-1794
            Fax: 713-659-1799

                                      -14-

<PAGE>

or to such other address as the party may have furnished to the other parties in
accordance herewith, except that notice of change of addresses shall be
effective only upon receipt.

      10.2 Governing Law. This Agreement shall be subject to, and interpreted by
and in accordance with, the laws (excluding conflict of law provisions) of the
State of Texas.

      10.3 Attorneys' Fees and Expenses. In any action brought by a Party to
enforce the obligations of the other Party, the prevailing Party shall be
entitled to collect from the opposing Party to such action such Party's
reasonable litigation costs and attorneys' fees and expenses (including court
costs, reasonable fees of accountants and experts and other expenses incidental
to the litigation).

      10.4 Entire Agreement. This Agreement is the entire Agreement of the
Parties respecting the subject matter hereof. There are no other agreements,
representations or warranties, whether oral or written, respecting the subject
matter hereof, and this Agreement supersedes and replaces any such prior
agreements, representations or warranties.

      10.5 Jointly Drafted. This Agreement, and all the provisions of this
Agreement, shall be deemed drafted by both of the Parties, and shall not be
construed against either Party on the basis of that Party's role in drafting
this Agreement.

      10.6 Further Assurances. In connection with this Agreement, each Party
shall execute and deliver any additional documents and instruments and perform
any additional acts that may be necessary or appropriate to effectuate and
perform the provisions of this Agreement.

      10.7 Successors and Assigns. This Agreement may not be assigned by either
Party without the prior written consent of the other Party. This Agreement shall
be binding upon and shall inure to the benefit of the Parties and their
respective successors and permitted assigns.

      10.8 No Third Party Beneficiaries. Nothing in this Agreement (except as
provided in Article VI) shall provide any benefit to any Third Party or entitle
any Third Party to any claim, cause of action, remedy or right of any kind, it
being the intent of the Parties that this Agreement shall not be construed as a
third-party beneficiary contract.

      10.9 Relationship of the Parties. Except as provided in Section 3.1,
nothing in this Agreement shall be construed to create a partnership or joint
venture, nor to authorize either Party to act as agent for or representative of
the other Party. Except as provided in Section 3.1, each Party shall be deemed
an independent contractor and neither Party shall act as, or hold itself out as
acting as, agent for any other Party.

      10.10 No Waiver. A Party to this Agreement may decide not to require, or
fail to require, full or timely performance of any obligation arising under this
Agreement. The decision not to require, or failure of a Party to require, full
or timely performance of any obligation arising under this Agreement (whether on
a single occasion or on multiple occasions) shall not be deemed a waiver of any
such obligation. No such decisions or failures shall give rise to any claim of
estoppel, laches, course of dealing, amendment of this Agreement by course of
dealing or other defense of any nature to any obligation arising hereunder.

                                      -15-

<PAGE>

      10.11 Amendments. This Agreement may be amended or modified only in a
writing signed by both Parties that specifically references this Agreement.

      10.12 Time of the Essence. Time is of the essence with respect to each
obligation arising under this Agreement.

      10.13 Unenforceability. In the event any provision of this Agreement, or
the application of such provision to any person or set of circumstances, shall
be determined to be invalid, unlawful or unenforceable to any extent for any
reason, the remainder of this Agreement, and the application of such provision
to Persons or circumstances other than those as to which it is determined to be
invalid, unlawful or unenforceable, shall not be affected and shall continue to
be enforceable to the fullest extent permitted by law.

      10.14 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which
together shall constitute but a single agreement.

                      [SIGNATURES APPEAR ON FOLLOWING PAGE]

                                      -16-

<PAGE>

      IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
adopted by them as of the date set forth above.

                                          "MANAGER"

                                          ENSOURCE ENERGY COMPANY LLC

                                          By:___________________________________
                                          Name:_________________________________
                                          Title:________________________________
                                          Date:_________________________________

                                          "EEP"

                                          ENSOURCE ENERGY PARTNERS LP

                                               By: Ensource Energy Company LLC

                                                   By:__________________________
                                                   Name:________________________
                                                   Title:_______________________
                                                   Date:________________________

<PAGE>

                                    EXHIBIT A

                               MANAGER'S INSURANCE

      Manager shall at all times, during the term of this Agreement, procure and
maintain with responsible insurance companies, the following minimum types and
coverages of insurance, and shall name as an additional insured (other than with
respect to worker's compensation insurance) EEP and the Fund, together with a
full waiver of subrogation against EEP and the Fund with respect thereto:

1.    Workers Compensation Insurance and Employers Liability Insurance in
      compliance with all applicable federal and state laws where EEP operates.

2.    Onshore Property Physical Damage Insurance - replacement cost insurance
      with $7,500 deductible per occurrence. Like kind and quality.

3.    Directors and Officers Liability Insurance with aggregate limit of $10
      million, Employment Practices claims deductible of $75,000, Securities
      Claims deductible of $150,000, all other claims deductible of $150,000.

4.    Comprehensive General Liability Insurance with combined single limit of
      not less than $1 million per occurrence, $2 million in the aggregate and
      $50,000 deductible. This policy shall be endorsed to provide coverage for:
      explosion, collapse and underground damage hazards to property of others
      contractual liability, disposal well operations, Louisiana pollutant and
      pollutions examples, maritime operations and products and completed
      operations.

                                     EXH-A-1

<PAGE>

                                    EXHIBIT B

                               DISPUTE RESOLUTION

1. Mediation. Either Party may initiate non-binding mediation by sending notice
in writing to the other Party identifying the issues in dispute and requesting
that they be resolved through mediation and proposing a neutral mediator. The
Party receiving the request for mediation shall have 7 business days after
receipt of the request to accept or reject the mediation request and to respond
to the initiating Party's suggestion of a mediator.

2. Binding Arbitration.

      (a) Any dispute arising out of or relating to this Agreement, including
claims sounding in contract, tort, statutory or otherwise (a "Dispute"), shall
be settled exclusively and finally by arbitration in accordance with this
EXHIBIT B.

      (b) Such arbitration shall be governed by and conducted pursuant to the
Federal Arbitration Act (including case law), except as expressly provided
otherwise in this Agreement. The making, validity, construction and
interpretation of this EXHIBIT B, and all procedural aspects of the arbitration
conducted pursuant hereto, shall be decided by the arbitrators. Except as
modified by this Agreement the arbitration shall be conducted in accordance with
the Federal Arbitration Act and, to the extent an issue is not addressed by the
federal law of arbitration, by the Commercial Arbitration Rules of the American
Arbitration Association (collectively, the "Rules").

      (c) The arbitrators shall permit discovery and rule on matters of
confidentiality as they determine is appropriate in the circumstances.

      (d) All arbitration proceedings hereunder shall be conducted in Houston,
Texas or such other location as the parties to such Dispute shall mutually
agree.

      (e) All arbitration proceedings hereunder shall be before a panel of 3
arbitrators consisting of individuals (which can include lawyers), having at
least 10 years of experience in or relating to the oil and gas industry. Within
30 days of the notice of initiation of the arbitration procedure, each Party
shall select 1 arbitrator. If either Party shall fail to select an arbitrator
within the required time, the other Party (that has selected an arbitrator)
shall select 2 arbitrators. The 2 arbitrators so selected shall select a third
arbitrator, failing agreement on which, the third arbitrator shall be selected
in accordance with the Rules.

      (f) In deciding the substance of the Dispute, the arbitrators shall refer
to the substantive laws of the State of Texas for guidance (excluding
choice-of-law principles that might call for the application of the laws of
another jurisdiction).

      (e) The arbitrators shall conduct an initial hearing as soon as reasonably
practicable but in no event later than 60 days after appointment of the third
arbitrator, and render a final decision completely disposing of the Dispute that
is the subject of such proceedings as soon as reasonably practicable but in no
event later than 15 days after the final hearing.

                                     EXH-B-1

<PAGE>

      (g) Notwithstanding any other provision in this Agreement to the contrary,
the Parties expressly agree that the arbitrators shall have absolutely no
authority to award consequential, incidental, special, treble, exemplary or
punitive damages of any type under any circumstances regardless of whether such
damages may be available under Texas law, or any other laws, or under the
Federal Arbitration Act or the Rules.

      (h) The Parties shall request that final decision of the arbitrators be in
writing, set forth the reasons for such final decision, and if the arbitrators
award monetary damages to a party, contain a certification by the arbitrators
that they have not included any consequential, incidental, special, treble,
exemplary or punitive damages. To the fullest extent permitted by law, the
arbitration proceeding and the arbitrators' decision and award shall be
maintained in confidence by the Parties and the Parties shall instruct the
arbitrators to likewise maintain such matters in confidence.

      (i) The fees and expenses of the arbitrators shall be borne equally by the
parties, but the decision of the arbitrators may include such award of the
arbitrators' expenses and of other costs.

      (j) The decision and award of the arbitrators shall be binding upon the
Parties and final and non-appealable to the maximum extent permitted by law, and
judgment thereon may be entered in a court of competent jurisdiction and
enforced by any Party as a final judgment of such court.

                                     EXH-B-2<PAGE>

                                                                    EXHIBIT 10.4

                            CONVEYANCE OF NET PROFITS
                           OVERRIDING ROYALTY INTEREST

      THIS CONVEYANCE OF NET PROFITS OVERRIDING ROYALTY INTEREST (this
"Conveyance"), dated as of the _____ day of ____________, 20____, is made from
and by Ensource Reserves Management LLC, a Delaware limited liability company
(herein called "WI Owner") to and in favor of Ensource Energy Income Fund LP, a
Delaware limited partnership (herein called "Royalty Owner").

                                   ARTICLE I

      Section 1.1 Defined Terms. When used in this Conveyance or in any exhibit
or schedule hereto (unless otherwise defined in any such exhibit or schedule),
the following terms have the respective meanings assigned to them in this
section or in the sections, subsections, exhibits and schedules referred to
below:

      "Affiliate" means, with respect any Person, any other Person directly or
indirectly controlling, controlled by or under common control with such Person.

      "Base NPI" means, for any Month, Gross Proceeds received from the sale of
Subject Hydrocarbons during such Month less (i) Direct Taxes paid during such
Month; (ii) Direct Operating Expenditures paid during such Month; and (iii) G&A
for such Month.

      "BOE" means one barrel of Oil or an equivalent quantity of Gas, where one
barrel of Oil is equivalent to six thousand cubic feet (6 mcf) of Gas.

      "Business Day" means a day that is not a Saturday, a Sunday, or a legal
holiday in ____________, _____________.

      "Commencement Time" means 7:00 a.m., local time at the location of the
Subject Lands, on ___________ 1, 20____.

      "Default Rate" means a rate of interest equal to the lower of either (i)
the sum of two percent (2%) plus the per annum rate of interest established from
time to time by [JP Morgan Chase Bank, N.A.] as its prime interest rate, and
(ii) the maximum non-usurious rate of interest permitted under applicable law,
calculated on the basis of actual days elapsed and a year of 365 days.

      "Delivery Point" means, for any Hydrocarbons produced from any Subject
Well, the point or points in the vicinity of the Subject Well at which such
Hydrocarbons are delivered into a gathering system or a transportation pipeline
or are otherwise transported from the Subject Well.

      "Delivery Services" means all services required (whether gathering,
treating, dehydrating, separating, compressing, processing, transporting, or
otherwise) to deliver, or cause to be delivered, all Subject Hydrocarbons to the
relevant Delivery Point in a condition

                                        1
<PAGE>

                                                                    EXHIBIT 10.4

satisfactory to meet or exceed pipeline or transporter specifications and
qualifications at such Delivery Point, and to market and sell (or cause to be
marketed and sold) all of the Subject Hydrocarbons.

      "Direct Operating Expenditures" means all direct expenditures (excluding
capital expenditures) for Delivery Services and for labor, services, materials
and supplies necessary for operating, producing, and maintaining the Subject
Interests; provided, however, that Direct Operating Expenditures shall not
include any payments by WI Owner pursuant to any Non-Consent Provision for
another Person's share of the costs of operations.

      "Direct Taxes" means all ad valorem, property, gathering, transportation,
pipeline regulating, gross receipts, windfall profit, severance, production,
excise, heating content, carbon, value added, environmental, occupation, sales,
use, fuel, and other taxes and government charges and assessments imposed on or
as a result of all of any part of the Subject Interests, the Subject
Hydrocarbons, the proceeds thereof, or the Net Profits Interest, regardless of
the point at which or the manner in which or the Person against whom such taxes,
charges or assessments are charged, collected, levied or otherwise imposed, and
includes interest, penalties and withholding obligations owing to Governmental
Authorities with respect to any of the foregoing. "Direct Taxes" do not include
federal income taxes, state income taxes, and franchise taxes and penalty or
interest surcharges thereon.

      "EEP" means Ensource Energy Partners, LP, a Delaware limited partnership,
which is the general partner of Royalty Owner and the sole member of WI Owner.

      "Ensource" means Ensource Energy Company LLC, a Delaware limited liability
company, which is the general partner of EEP.

      "Environmental Laws" means any and all Laws regulating or otherwise
pertaining to (a) the use, generation, migration, storage, removal, treatment,
remedy, discharge, release, transportation, disposal or cleanup of pollutants,
contamination, hazardous wastes, hazardous substances, hazardous materials,
toxic substances or toxic pollutants, (b) environmental matters involving the
soil, surface waters, groundwater, land, stream sediments, surface or subsurface
strata, ambient air and any other environmental medium on or off any of the
Subject Interest, or (c) the environment or health and safety-related matters;
including the following as from time to time amended and all others whether
similar or dissimilar and whether now existing or hereinafter enacted: the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended by the Superfund Amendments and Reauthorization Act of 1986, the
Resource Conservation and Recovery Act of 1976, as amended by the Used Oil
Recycling Act of 1980, the Solid Waste Disposal Act amendments of 1980, and the
Hazardous and Solid Waste Amendments of 1984, the Hazardous Materials
Transportation Act, as amended, the Toxic Substance Control Act, as amended, the
Clean Air Act, as amended, the Clean Water Act, as amended, and all regulations
promulgated pursuant thereto.

      "G&A" means, for any Month, an amount equal to WI Owner's G&A for such
Month multiplied by a fraction, the numerator of which is the BOEs of Subject
Hydrocarbons produced and sold or otherwise disposed of during such Month, and
the denominator of which is the total

                                        2
<PAGE>

                                                                    EXHIBIT 10.4

BOEs of Hydrocarbons produced and sold or otherwise disposed of by or on behalf
or WI Owner during such Month.

      "Gas" means natural gas and all other gaseous hydrocarbons, including
casinghead gas, but excluding condensate and other liquid hydrocarbons removed
by conventional mechanical field separation at the wellhead and also excluding
the liquid products of any processing of Gas done prior to the sale of such Gas.

      "Governmental Authority" means any nation, country, commonwealth,
territory, state, county, parish, municipality or any political subdivision,
agency, department, commission, board or other instrumentality of any of the
foregoing.

      "Gross Proceeds" means, with respect to any Subject Hydrocarbons, the
gross proceeds received from sale or other disposition of such Subject
Hydrocarbons, subject to the following:

            (a) Gross Proceeds shall only include all consideration received,
      directly or indirectly, for sales or other dispositions of Subject
      Hydrocarbons;

            (b) If a controversy or possible controversy exists (whether by
      reason of any Law, contract, or otherwise) as to the correct or lawful
      sales price of any Subject Hydrocarbons, then amounts received by WI Owner
      and promptly deposited by it with an escrow agent, to be placed in
      interest bearing accounts under usual and customary terms, shall not be
      considered to have been received by WI Owner and shall not be included in
      Gross Proceeds until disbursed to WI Owner by such escrow agent;

            (c) Gross Proceeds shall not include any proceeds received by WI
      Owner from the sale of Hydrocarbons belonging to another Person that WI
      Owner is entitled to obtain pursuant to any Non-consent Provision as a
      result of having paid a portion of such other Person's costs of
      operations; and

            (d) Gross Proceeds shall not include any proceeds received by WI
      Owner from any swap, collar, option, hedge or other products that manage
      price risk exposure, but shall include proceeds of forward sales contracts
      if the sales price is the Market Value of the Subject Hydrocarbons as of
      the date such forward sales contract was entered into.

In the event of a disposition of Subject Hydrocarbons other than a sale thereof,
the amounts described in clause (2) shall be deemed to have been received by WI
Owner during the Month next following the Month in which such Subject
Hydrocarbons were produced. All sales of Subject Hydrocarbons must be made at
not less than the Market Value of such Subject Hydrocarbons as of the date the
commitment to sell same is entered into.

      "Hydrocarbons" means Gas and Oil.

      "Law" means any constitution, statute, ordinance, regulation, rule,
ruling, order, restriction, writ, judgment, decree, injunction, or other
requirement or official act of or by any Governmental Authority of any kind.

                                        3
<PAGE>

                                                                    EXHIBIT 10.4

      "Lien" means, with respect to any property or assets, any lien, mortgage,
deed of trust, security interest, pledge, security deposit, production payment,
rights of a vendor under any title retention or conditional sale agreement or
lease substantially equivalent thereto, tax lien, mechanic's or materialman's
lien, or any other charge or encumbrance for security purposes, whether arising
by Law or agreement or otherwise.

      "Loan Documents" means the Revolving Facility and any note, guaranty,
mortgage, deed of trust, security agreement, financing statement, pledge or
other agreement, certificate, document, instrument or writing at any time
delivered in connection therewith.

      "Management Agreement" means that certain Management Agreement, dated
__________, by and between Ensource and WI Owner.

      "Management Incentive Fee" has the meaning provided in the Management
Agreement.

      "Market Value" of any Subject Hydrocarbons means:

            (a) With respect to Gas, (i) the average of the three highest prices
      (adjusted for all material differences in quality) being paid at the time
      of production in sales between Non-Affiliates for Gas purchased within a
      10-mile radius of the applicable Subject Well, but, for any Gas subject to
      price restrictions established, prescribed or otherwise imposed by any
      Governmental Authority having jurisdiction over the sale of such Gas, no
      more than the highest price permitted for such category or type of Gas
      after all applicable adjustments (including tax reimbursement,
      dehydration, compression and gathering allowances, inflation and other
      permitted escalations), or (ii) if subsection (a)(i) above is not
      applicable, the fair market value of such Gas on the date of delivery, at
      the lease, determined in accordance with other generally accepted and
      usual industry practices; and

            (b) With respect to Oil, (i) the highest price available to WI Owner
      for such Oil at the lease, on the date of delivery, pursuant to a bona
      fide offer, posted price or other generally available marketing
      arrangement from or with a Non-Affiliate purchaser, or (ii) if no such
      offer, posted price or arrangement is available, the fair market value of
      such Oil on the date of delivery, at the lease, determined in accordance
      with other generally accepted and usual industry practices.

      "Month" means the period between 7:00 a.m., local time at the location of
the Subject Lands on the first day of a calendar month and 7:00 a.m., local time
at the location of the Subject Lands on the first day of the next calendar
month.

      "Net Profits" has the meaning given to such term in Section 2.2.

      "Net Profits Interest" means the overriding royalty interest which is
granted herein to Royalty Owner, and all other rights, titles, interests,
estates, remedies, powers and privileges appurtenant or incident to such
overriding royalty, whether arising hereunder, by operation of Law, or
otherwise.

                                        4
<PAGE>

                                                                    EXHIBIT 10.4

      "Non-Affiliate" means, with respect to any Person, any Person who is not
an Affiliate of such Person.

      "Non-Consent Hydrocarbons" means those Hydrocarbons produced from a
Subject Well during the Recoupment Period pursuant to a Non-Consent Provision
covering that Subject Well, which Hydrocarbons have been relinquished by WI
Owner to the consenting party or participating party under the terms of such
Non-Consent Provision as the result of the election by WI Owner not to
participate in an operation related to the Subject Interests subject to that
Non-Consent Provision.

      "Non-Consent Provision" means a contractual provision contained in a
third-party operating agreement, unit agreement, contract for development,
farmout agreement or other similar instrument to which the Subject Interests are
subject that is in effect as of the Commencement Time, or that WI Owner enters
in the ordinary course of business after the Commencement Time, which covers
non-consent operations or sole benefit operations and provides for
relinquishment of Hydrocarbon production by non-consenting or non-participating
parties during a period of recoupment of costs and expenses of the consenting or
participating parties.

      "NRI Percentage" means, with respect to each well, unit, lease or other
interest described on Exhibit "A", the percentage shown on Exhibit "A" as the
"Net Revenue Interest" for such interest.

      "Oil" means crude oil, condensate, and other liquid hydrocarbons,
including liquid hydrocarbons removed by conventional mechanical field
separation at the wellhead and also including the liquid products of any
processing of Gas done prior to the sale of such Gas.

      "Permitted Liens" means (i) Liens securing obligations under the Loan
Documents, (ii) Liens securing payment of Direct Taxes, (iii) Liens securing the
claims and demands of materialmen, mechanics, carriers, and warehousemen, (iv)
Liens securing obligations under joint operating agreements applicable to the
Subject Lands; and (v) Liens securing payment of lessors' royalties; provided
that with respect to Liens described in clauses (ii) through (v) above, such
Liens arise in the ordinary course of business in respect of obligations that
are not yet due or which are being contested in good faith by appropriate
proceedings diligently pursued, and further provided that no foreclosure,
distraint, sale, or other similar proceedings shall have been initiated with
respect thereto.

      "Person" means a natural person, partnership, limited partnership, limited
liability company, association, joint stock company, pension fund, trust or
trustee thereof, estate or executor thereof, unincorporated organization or
joint venture, court or governmental unit or any agency or subdivision thereof,
or any other legally recognizable entity.

      "Recoupment Period" means any period of time in which Non-Consent
Hydrocarbons are being recouped pursuant to a Non-Consent Provision by parties
who participated in an operation in which WI Owner elected not to participate.

                                        5
<PAGE>

                                                                    EXHIBIT 10.4

      "Retained Working Capital" means, with respect to any Month, that portion
of Gross Proceeds retained by WI Owner, at the direction of Ensource, in
accordance with [_________________] [DESCRIBE APPLICABLE AGREEMENT], in order to
satisfy WI Owner's anticipated working capital requirements.

      "Reimbursable Expenses" means all actual and reasonable costs and expenses
paid or incurred by or on behalf of Royalty Owner or its Affiliates which are in
any way related to: (a) the negotiation, acquisition, ownership, enforcement, or
termination of the Net Profits Interest, this Conveyance or any waivers or
amendments hereto or thereto, or (b) any litigation, contest, release or
discharge of any adverse claim or demand made or proceeding instituted by any
Person affecting in any manner whatsoever the Net Profits Interest, any Subject
Hydrocarbons or Net Profits, this Conveyance or the enforcement or defense
hereof or thereof, or the defense of Royalty Owner's and its Affiliates'
exercise of their rights hereunder or thereunder. Included among the
Reimbursable Expenses are (i) all recording and filing fees, (ii) all actual and
reasonable fees and expense of counsel, engineers, accountants and other
consultants, experts and advisors for Royalty Owner and its Affiliates, and
(iii) all amounts which Royalty Owner is entitled to receive under Section 5.1
hereof and all costs of Royalty Owner in exercising any of its remedies under
Section 5.1 hereof.

      "Revolving Facility" means any credit facility or agreement which WI Owner
or its successor may, from time to time, enter into in order to provide funding
for the exploration, development and/or operation of the Subject Interests,
together with any amendment, restatement, refunding, refinancing, or replacement
thereof.

      "Royalty Owner" means the Person named in the preamble to this Conveyance
as the Royalty Owner, and, unless the context in which used shall otherwise
require, such term shall also include any successor to such Person as owner at
the time in question of any or all of the Net Profits Interest.

      "Subject Hydrocarbons" means that portion of the Hydrocarbons in and under
and that may be produced from (or, to the extent pooled or unitized, allocated
to) the Subject Lands which is attributable to the Subject Interests (determined
after deducting all royalties, overriding royalties, production payments and
similar burdens, excluding only the Net Profits Interest, which burden the
Subject Interests at the Commencement Time).

      "Subject Interests" means:

            (a) All of the leasehold interests and other property interests
      described in Exhibit "A" attached hereto, to the extent of the NRI
      Percentage listed for such leasehold or other property interest on Exhibit
      "A" and

            (b) Without limitation of the foregoing, all other right, title and
      interest (of whatever kind or character, whether legal or equitable and
      whether vested or contingent) of WI Owner in and to the Oil, Gas and other
      minerals in and under or that may be produced from any Subject Lands
      (including interests in oil, gas or mineral leases to the extent the same
      cover such lands, overriding royalties, production payments and net
      profits interests in such lands or such leases, and fee mineral interests,
      fee royalty

                                        6
<PAGE>

                                                                    EXHIBIT 10.4

      interests and other interests in such Oil, Gas and other minerals) even
      though WI Owner's interest in such Oil, Gas and other minerals may be
      incorrectly described in, or omitted from, Exhibit "A", to the extent of,
      and expressly limited to, the NRI Percentage listed for such leasehold or
      other property interests on Exhibit "A"; and

            (c) All rights, titles and interests of WI Owner in and to, or
      otherwise derived from, all presently existing and valid oil, gas or
      mineral unitization, pooling, or communitization agreements, declarations
      or orders and in and to the properties covered and the units created
      thereby (including all units formed under orders, rules, regulations, or
      other official acts of any Governmental Authority having jurisdiction,
      voluntary unitization agreements, designations or declarations, and
      so-called "working interest units" created under operating agreements or
      otherwise) relating to the properties described in subsections (a) or (b)
      above in this definition.

      "Subject Lands" means the lands and depths described in Exhibit "A" (where
no depth limit is specified, Subject Lands shall include all depths) and all
lands and depths covered by the Subject Interests, whether or not described in
Exhibit "A".

      "Subject Wells" means all wells now located on the Subject Lands (whether
fully drilled and completed or not) or hereafter drilled on the Subject Lands,
and (unless production therefrom is expressly excluded by the terms of the
description on Exhibit "A") any other wells now or hereafter located on lands or
leases pooled, communitized or unitized with the Subject Lands or the Subject
Interests.

      "WI Owner" means the Person named in the preamble of this Conveyance as WI
Owner, and, unless the context in which used shall otherwise require, such term
means any successor-owner at the time in question or any of all of the Subject
Interests (other than the Net Profits Interest).

      "WI Owner's G&A" means general and administrative costs and expenses
incurred in the management and operation of WI Owner, including costs of
administrative services (including accounting, tax, legal and other services)
and office services, including salaries or wages and other applicable burdens
and expenses of employees and consultants, including, without limitation or
duplication, all fees and other amounts payable under the Management Agreement,
including any Management Incentive Fee earned during such Month (it being
understood that any Management Incentive Fee shall be included in G&A for the
Month in which it is earned, notwithstanding that the Management Incentive Fee,
which is payable quarterly, may actually be paid in a subsequent Month).

      Section 1.2 Rules of Construction. All references in this Conveyance to
articles, sections, subsections and other subdivisions refer to corresponding
articles, sections, subsections and other subdivisions of this Conveyance unless
expressly provided otherwise. Titles appearing at the beginning of any of such
subdivisions are for convenience only and shall not constitute part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions. The words "this Conveyance", "this instrument", "herein",
"hereof", "hereunder" and words of similar import refer to this Conveyance as a
whole and not to any particular subdivisions unless expressly so limited. Unless
the context otherwise requires: "including" and

                                       7
<PAGE>

                                                                    EXHIBIT 10.4

its grammatical variations mean "including without limitation"; "or" is not
exclusive; words in the singular form shall be construed to include the plural
and vice versa; words in any gender include all other genders; references herein
to any instrument or agreement refer to such instrument or agreement as it may
be from time to time amended or supplemented; and reference herein to any Person
includes such Person's successors and assigns. All references in this Conveyance
to exhibits and schedules refer to exhibits and schedules to this Conveyance
unless expressly provided otherwise, and all such exhibits and schedules are
hereby incorporated herein by reference and made a part hereof for all purposes.

                                   ARTICLE II

      Section 2.1 Conveyance. WI Owner does hereby GRANT, BARGAIN, SELL, CONVEY,
ASSIGN, TRANSFER, SET OVER AND DELIVER unto Royalty Owner an overriding royalty
interest in and to the Subject Hydrocarbons equal to __________ percent (_____%)
[AMOUNT TO BE DETERMINED AS TO EACH PROPERTY, SUCH AMOUNT NOT TO EXCEED 99.0%]
of the Net Profits, if any, calculated in the manner provided for herein, that
are realized from the production of Hydrocarbons from the Subject Interests from
and after the Commencement Time.

      TO HAVE AND HOLD the Net Profits Interest, together with all and singular
the rights and appurtenances thereto in anywise belonging, unto Royalty Owner
and its successors and assigns, forever, subject to the terms and conditions
hereof.

      Section 2.2 Net Profits. WI Owner shall determine the Net Profits for each
Month on or before the last Business Day of the following Month. As used herein,
"Net Profits" means, for any Month, the positive remainder, if any, of the Base
NPI for such Month, minus the following amounts:

            (a) Capital expenditures with respect to the Subject Interests paid
      by or on behalf of WI Owner during such Month;

            (b) Principal, interest, fees, expenses and any other amounts paid
      by WI Owner under the Revolving Facility or any other Loan Document during
      such Month; and

            (c) Retained Working Capital.

      If for any Month the Base NPI minus the deductions set forth in clauses
(a) through (d) above is an amount that is less than zero, such negative amount
(a "Debit Balance") shall be carried forward and deducted from the following
Month's Base NPI (and, if a negative balance remains, from any successive
Month's Base NPI, until the entire amount of such Debit Balance has been
deducted from Base NPI).

      Nothing in this Agreement shall be interpreted or applied in any manner
that shall ever require or permit any duplication of all or any part of any
credit or charge to Net Profits with respect to the same transaction or that
shall ever require or permit the inclusion of any charge to Net Profits that is
reimbursed to WI Owner by any third Person.

                                        8
<PAGE>

                                                                    EXHIBIT 10.4

      Section 2.3 Payments. WI Owner shall furnish to Royalty Owner a detailed
statement setting out the calculation of the Net Profits for each Month on or
before the last Business Day of the following Month, clearly reflecting (with
sufficient description so that Royalty Owner can identify such items and the
particular Subject Interest involved) each item taken into account in making
such calculation and clearly reflecting for each Subject Interest the quantities
of Subject Hydrocarbons produced therefrom during the Month covered by such
statement, the volumes of such production sold, the prices at which such volumes
were sold, and the taxes paid with respect to such sales. WI Owner shall pay to
Royalty Owner its share of the Net Profits shown in such statement by means of a
check enclosed with such statement (or, if requested at any time by Royalty
Owner, paid by bank wire transfer of immediately available funds to such bank
and account as may be designated in writing by Royalty Owner).

      Section 2.4 Overpayments. If at any time WI Owner inadvertently pays
Royalty Owner more than the amount then due with respect to the Net Profits
Interest, Royalty Owner (a) shall promptly repay to WI Owner any particular
overpayment which exceeds $5,000, and (b) shall not be obligated to return any
particular overpayment which does not exceed $5,000, but the amount or amounts
otherwise payable for any subsequent period or periods shall be reduced by such
overpayment.

      Section 2.5 Past Due Payments. Any amount with respect to the Net Profits
Interest not paid by WI Owner to Royalty Owner when due shall bear interest at
the Default Rate from the due date until such amount has been paid.

      Section 2.6 Non-Cost Bearing Interest; Payment of Costs and Expenses.
Although certain Direct Taxes and operating expenses are taken into account in
determining Net Profits, as set forth in Section 4.1 hereof, Royalty Owner shall
have no liability for any costs, expenses or obligations of WI Owner, including,
without limitation, for any (a) Direct Taxes, (b) costs and expenses associated
with acquiring, exploring, developing, maintaining, producing, operating,
reworking, recompleting, and remediating the Subject Interests, (c) royalties,
overriding royalties, production payments, and similar charges burdening the
Subject Interests, or (d) costs for Delivery Services. All such costs and
expenses shall be paid by WI Owner promptly, on or before the dates the same
become delinquent (unless being disputed in good faith by appropriate
proceedings being diligently pursued and for which adequate reserves have been
established, provided that such dispute causes no interruption in production or
Delivery Services). In addition, WI Owner will promptly (and in any event within
30 days after receiving any notice or statement for the same) pay all
Reimbursable Expenses which have been incurred and are unpaid and reimburse
Royalty Owner for any Reimbursable Expenses which have been paid by or on behalf
of Royalty Owner. Each amount which is to be paid by WI Owner pursuant to this
Section 2.6 which is instead paid by or on behalf of Royalty Owner shall bear
interest at the Default Rate on each day from and including the date of such
payment until but not including the date repaid by WI Owner.

      Section 2.7 Hydrocarbons Lost or Used. As used in this Conveyance, the
term "Subject Hydrocarbons" shall not include (and the calculation of Gross
Proceeds shall not include) Hydrocarbons produced from a Subject Well which are
(i) unavoidably lost in the production thereof or in the compression or
transportation thereof prior to the applicable Delivery Point or (ii) used by WI
Owner or the operator of any Subject Well for the production

                                        9
<PAGE>

                                                                    EXHIBIT 10.4

of Subject Hydrocarbons or for the compression or transportation of Subject
Hydrocarbons prior to the applicable Delivery Point, in each case only to the
extent the same are lost or used in the course of operations which are being
conducted prudently and in a good and workmanlike manner.

                                  ARTICLE III

      Section 3.1 Operations. As between Royalty Owner and WI Owner, WI Owner
shall have exclusive charge, management and control of all operations to be
conducted on the Subject Interests. Pursuant to the Management Agreement, WI
Owner has engaged Ensource, on the terms and subject to the conditions set forth
therein, to manage and control [Royalty Owner's] [WI OWNER'S?] operations,
including the Subject Interests. WI Owner shall take (or, to the extent WI Owner
is not the operator of a Subject Interest, use commercially reasonable efforts
to cause to be taken) any and all actions that a prudent operator would deem
necessary or appropriate in the development, operation, maintenance and
management thereof and in the production, handling, treating and transportation
of Hydrocarbons produced therefrom to the applicable Delivery Points, and in so
doing WI Owner shall not take into account the diminution of WI Owner's share of
production from the Subject Interests caused by the granting of the Net Profits
Interest and WI Owner shall at all times make its economic decisions as if WI
Owner owned the full interest in the Subject Interests undiminished by the Net
Profits Interest. In addition to, but without limitation of, the foregoing, (a)
WI Owner shall take (or, to the extent WI Owner is not the operator of a Subject
Interest, use commercially reasonable efforts to cause to be taken) any and all
actions that a prudent operator would deem appropriate to maintain the Subject
Interests in full force and effect, (b) WI Owner shall not allow any Liens to
attach to or burden the Net Profits Interest, other than Permitted Liens, (c) WI
Owner shall comply with and act in accordance with all applicable Law, (d) WI
Owner shall maintain insurance on the Subject Interests of such types and in
such amounts as would be maintained by a reasonable, prudent operator similarly
situated, and (e) consistent with the standards of a reasonable and prudent
operator, WI Owner specifically agrees to keep and perform (or to the extent WI
Owner is not the operator of a Subject Interest, use commercially reasonable
efforts to cause the operator to keep and perform) all of the terms, conditions,
and covenants, express and implied, of the leases comprising the Subject
Interests. It is specifically understood and agreed that WI Owner may,
consistent with its duties as a prudent operator, make elections under
applicable joint operating agreements regarding whether to participate in
operations proposed by others respecting the Subject Interests, and the Net
Profits Interest shall not apply to the Subject Hydrocarbons that have been
relinquished by WI Owner to such participating parties during the Recoupment
Period. WI Owner may unitize, pool or otherwise combine all or any portion of
the Subject Interests and Subject Lands and the Net Profits Interests described
and conveyed herein with any other lands or leases on the terms and conditions
as set forth in the Subject Interests.

      Section 3.2 Delivery Services. WI Owner shall deliver, or cause to be
delivered, all Subject Hydrocarbons to the relevant Delivery Point in a
condition satisfactory to meet or exceed pipeline or transporter specifications
and qualifications at such Delivery Point, and WI Owner will market and sell (or
cause to be marketed and sold) all of the Subject Hydrocarbons in arm's length
transactions with Non-Affiliates on reasonable market terms that are at least as
good as those obtained by WI Owner and its Affiliates with respect to all other
Hydrocarbons marketed by them in the area of the Subject Lands.

                                       10
<PAGE>

                                                                    EXHIBIT 10.4

      Section 3.3 Renewals and Extensions and New Leases. This Conveyance and
the Net Profits Interest shall apply to WI Owner's and its Affiliates' interests
in all renewals, extensions and other similar arrangements of each lease (or
other determinable interest) which is included in the Subject Interests, whether
such renewals, extensions or arrangements have heretofore been obtained by WI
Owner or are hereafter obtained by or for WI Owner or any Affiliate thereof and
whether or not the same are described in Exhibit "A". For the purposes of the
preceding sentence, a new lease that covers the same interest (or any part
thereof) covered by a prior lease, and which is acquired within one year after
the expiration, termination, or release of such prior lease, shall be treated as
a renewal or extension of such prior lease.

      Section 3.4 Access, Inspection and Information; Audit Rights. Royalty
Owner and its representatives, at the risk and expense of Royalty Owner and to
the extent permitted by existing agreements covering the Subject Interests,
shall have access at all reasonable times to the Subject Interests and to all
operations of WI Owner related to the Subject Interests, and the right to
observe all operations conducted thereon. WI Owner shall on request promptly
furnish Royalty Owner with any and all information in WI Owner's possession or
under WI Owner's control pertaining to the Subject Interests. In addition,
Royalty Owner shall have the right to audit WI Owner's records with respect to
this Conveyance and the Subject Interests, in order to determine that Royalty
Owner has received its share of Net Profits in accordance with the terms of this
Conveyance. Royalty Owner shall give WI Owner at least fifteen (15) days' prior
written notice of such audit, which shall be performed in WI Owner's offices
during regular business hours, at Royalty Owner's expense. The audit may be
performed, at Royalty Owner's option, by its own employees or those of its
Affiliates or by a firm of certified public accountants or other representatives
retained by Royalty Owner. Any error uncovered by Royalty Owner's audit shall be
promptly reported in writing to WI Owner. Upon the final determination by
Royalty Owner of the existence and amount of any error, the party owing payment
as a result of such error shall pay the other party the amount of the error,
plus interest at the Default Rate from the date of such written notice from
Royalty Owner notifying WI Owner of its final determination that such amounts
are owed until the date such payment is actually made.

                                   ARTICLE IV

      Section 4.1 No Liability of Royalty Owner Parties; Indemnity. NO ROYALTY
OWNER PARTY (AS DEFINED BELOW) SHALL EVER BE LIABLE FOR ANY PART OF THE COSTS,
EXPENSES OR LIABILITIES ASSOCIATED WITH OR ARISING FROM THE SUBJECT LANDS, THE
SUBJECT INTERESTS OR THE HYDROCARBONS PRODUCED FROM THE SUBJECT LANDS,
INCLUDING, WITHOUT LIMITATION, ANY COSTS, EXPENSES OR LIABILITIES INCURRED IN
CONNECTION WITH THE EXPLORING, DEVELOPING, OPERATING, OWNING, MAINTAINING,
REWORKING OR RECOMPLETING OF THE SUBJECT INTERESTS OR SUBJECT LANDS, THE
PHYSICAL CONDITION OF THE SUBJECT INTERESTS OR THE SUBJECT LANDS, OR THE
HANDLING, TREATING OR TRANSPORTING OF HYDROCARBONS PRODUCED FROM THE SUBJECT
LANDS (INCLUDING ANY COSTS, EXPENSES, LOSSES OR LIABILITIES RELATED TO VIOLATION
OF AN ENVIRONMENTAL LAW OR OTHERWISE RELATED TO DAMAGE TO OR REMEDIATION OF THE
ENVIRONMENT, WHETHER THE SAME ARISE OUT OF ROYALTY OWNER'S OWNERSHIP OF AN
INTEREST IN PROPERTY OR OUT OF THE ACTIONS OF WI OWNER OR ROYALTY OWNER OR OF
THIRD PARTIES OR ARISE OTHERWISE), AND WI OWNER WILL INDEMNIFY AND HOLD EACH
ROYALTY OWNER PARTY HARMLESS FROM AND AGAINST ALL COSTS, EXPENSES, LOSSES AND
LIABILITIES

                                       11
<PAGE>

                                                                    EXHIBIT 10.4

INCURRED BY ANY ROYALTY OWNER PARTY IN CONNECTION WITH ANY OF THE FOREGOING.
SUCH INDEMNITY SHALL ALSO COVER REASONABLE COSTS AND EXPENSES OF ANY ROYALTY
OWNER PARTY, INCLUDING REASONABLE LEGAL FEES AND EXPENSES, WHICH ARE INCURRED IN
CONNECTION WITH THE MATTERS INDEMNIFIED AGAINST. AS USED IN THIS SECTION 4.1,
"ROYALTY OWNER PARTIES" MEANS ROYALTY OWNER AND ROYALTY OWNER'S SUCCESSORS AND
ASSIGNS (INCLUDING ANY PERSON AT ANY TIME LENDING FUNDS TO ROYALTY OWNER SECURED
BY A LIEN ON ANY PART OF THE NET PROFITS INTERESTS), ALL OF THEIR RESPECTIVE
AFFILIATES, AND ALL OF THE OFFICERS, DIRECTORS, AGENTS, BENEFICIARIES, TRUSTEES,
ATTORNEYS AND EMPLOYEES OF THEMSELVES AND THEIR AFFILIATES. THE FOREGOING
INDEMNITY SHALL APPLY WHETHER OR NOT ARISING OUT OF THE SOLE, JOINT OR
CONCURRENT NEGLIGENCE, FAULT OR STRICT LIABILITY OF ANY ROYALTY OWNER PARTY AND
SHALL APPLY, WITHOUT LIMITATION, TO ANY LIABILITY IMPOSED UPON ANY ROYALTY OWNER
PARTY AS A RESULT OF ANY THEORY OF STRICT LIABILITY OR ANY OTHER DOCTRINE OF
LAW, PROVIDED THAT THE FOREGOING INDEMNITY SHALL NOT APPLY TO ANY COSTS,
EXPENSES, LOSSES OR LIABILITIES INCURRED BY ANY ROYALTY OWNER PARTY TO THE
EXTENT PROXIMATELY CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH
ROYALTY OWNER PARTY.

                                   ARTICLE V

      Section 5.1 Remedies. If WI Owner breaches any of its covenants,
agreement, representations or warranties made in this Conveyance, or if WI Owner
or any of its Affiliates or any Person acting on its behalf challenges the
validity or enforceability of any provision of this Conveyance, then Royalty
Owner may, either on its own behalf or through any agent or representative and
in addition to all other rights and remedies available to Royalty Owner at law
and in equity (including the right to sue for damages, which right of Royalty
Owner is specifically acknowledged), exercise any one or more of the following
remedies (it being agreed that the exercising of any one remedy shall not
preclude the exercising of any other remedy):

            (a) If WI Owner failed to cure any of the foregoing breaches or to
      obtain the dismissal and termination of any of the foregoing challenges,
      then, upon written notice to WI Owner, Royalty Owner may, but shall not be
      obligated to, take such action and pay such money, all in WI Owner's name
      or in Royalty Owner's own name, as may be required to cure or mitigate
      such breach or to obtain the dismissal and termination of such challenge.
      Any expense so incurred by Royalty Owner and any money so paid by Royalty
      Owner shall be obligations owing by WI Owner to Royalty Owner (which
      obligations WI Owner hereby expressly promises to pay) and Royalty Owner,
      upon making such payment, shall be subrogated to all rights of the Person
      receiving such payment. Each amount due and owing by WI Owner to Royalty
      Owner pursuant to this subsection shall bear interest each day, from the
      date of such expenditure or payment until paid, at the Default Rate, which
      interest shall be payable on the first day of each calendar month and
      shall itself bear interest at the same rate if not timely paid.

            (b) Royalty Owner shall be entitled to apply to a court of competent
      jurisdiction for the specific performance or observance of any covenant or
      agreement or in aid of the execution of any power herein granted and for
      the appointment of a receiver

                                       12
<PAGE>

                                                                    EXHIBIT 10.4

      for the Subject Interests and the Subject Hydrocarbons, but no such
      appointment shall prejudice or affect the rights of Royalty Owner to
      receive all Net Profits due hereunder.

                                   ARTICLE VI

      Section 6.1 Assignments. Royalty Owner shall have the right to assign,
sell, transfer, convey, exchange, mortgage or pledge the Net Profits Interest in
whole or in part at any time. WI Owner may not assign, sell, transfer, convey,
exchange, mortgage or pledge its interest in the Subject Interests in whole or
in part at any time, without the prior written consent of Royalty Owner. No
change of ownership of the Net Profits Interest will be binding upon WI Owner
until WI Owner is furnished with written notice of such change, together with a
copy of the assignment or other instrument evidencing such transfer, as recorded
in the official records of the county or parish in which the Subject Lands are
located.

      Section 6.2 Binding Effect. All the covenants and agreements of the
respective parties herein contained shall be deemed to be covenants running with
the Subject Interests and the lands covered thereby or included therein. All of
the provisions hereof shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns.

                                  ARTICLE VII

      Section 7.1 Special Warranty of Title. WI Owner hereby binds itself to
warrant and forever defend all and singular title to the Net Profits Interest
unto Royalty Owner, its successors and assigns, against any Person lawfully
claiming or to claim the same or any part thereof by, through or under WI Owner,
but not otherwise. Without limiting the generality of the foregoing, WI Owner
represents and warrants to Royalty Owner that the ownership of WI Owner of the
Subject Interests does and will, with respect to each tract of land, lease, unit
or well identified in Exhibit "A" hereto:

            (a) entitle WI Owner and Royalty Owner collectively to receive, free
      and clear of all Liens, other than Permitted Liens, a decimal or
      percentage net revenue interest share of the Hydrocarbons produced from,
      or allocated to, such tract, lease or unit equal to not less than the
      decimal or percentage interest set forth in Exhibit "A" in connection
      therewith in the column headed "Net Revenue Interest", and

            (b) cause WI Owner to be obligated to bear a decimal or percentage
      share of the costs associated with wells or operation on such tract, lease
      or unit not greater than the decimal or percentage share set forth in
      Exhibit "A" in connection therewith in the column headed "Working
      Interest", unless there is a corresponding increase in net revenue
      interest.

WI Owner further represents and warrants to Royalty Owner that such shares of
production which WI Owner and Royalty Owner are entitled to receive, and shares
of expenses which WI Owner is obligated to bear, are not and will not be subject
to change except, and only to the extent that, such changes are reflected on
Exhibit "A". This Conveyance is made with full substitution and subrogation of
Royalty Owner in and to all covenants, representations and warranties by others
heretofore given or made with respect to the Subject Interests.

                                       13
<PAGE>

                                                                    EXHIBIT 10.4

                                  ARTICLE VIII

      Section 8.1 Choice of Law. This Conveyance shall be construed under,
enforced in accordance with and governed by the laws of the State of
_________________ , without reference to conflicts of law provisions thereof
that would require the application of the laws of another jurisdiction.

      Section 8.2 No Partnership. Nothing herein contained shall be construed to
constitute a joint venture, partnership (under state Law or for tax purposes),
mining partnership or other association between the parties hereto.

      Section 8.3 Nature of Interest Conveyed. The parties hereto intend that
the Net Profits Interest is not a mere contractual right to receive money, but
rather is, and shall at all times be treated as (and all provisions of this
Conveyance shall be construed and treated accordingly), an overriding royalty
interest, such interest being a real property interest under the Laws of the
jurisdiction in which the Subject Lands are located.

      Section 8.4 No Ownership of Equipment. The Net Profits Interest does not
include any right, title or interest in and to any of the personal property,
fixtures, structures or equipment now or hereafter placed on, or used in
connection with, the Subject Interests.

      Section 8.5 Further Assurances. WI Owner hereto agrees, upon request
therefor by Royalty Owner, to execute and deliver to Royalty Owner all such
other and additional instruments, notices, division orders, transfer orders and
other documents and to do all such other and further acts and things as may be
reasonably necessary or desirable to correct any error herein and to more fully
and effectively grant, convey and assign to Royalty Owner the rights, titles,
interest and estates conveyed to Royalty Owner hereby or intended to be so
conveyed. If any Person ever challenges or attacks (a) the validity,
enforceability or priority of this Conveyance or the Net Profits Interest or (b)
the title of WI Owner to any Subject Interest or of Royalty Owner to the Net
Profits Interest, then upon learning thereof WI Owner shall give prompt written
notice thereof to Royalty Owner and at WI Owner's own cost and expense will
diligently endeavor to defeat such challenge or attack and to cure any defect
that may be developed or claimed, and WI Owner will take all reasonable steps
for the defense of any legal proceedings with respect thereto, litigation, and
the release or discharge of all adverse claims. Royalty Owner is hereby
authorized and empowered to take such additional steps as in its judgment and
discretion may be necessary or proper for the defense of any such legal
proceedings or the protection of the enforceability, validity or priority of
this Conveyance and the Net Profits Interest, including the employment of
independent counsel to represent Royalty Owner, the prosecution or defense of
litigation, the compromise or discharge of any adverse claims made with respect
to the Subject Interests or the Net Profits Interests, the removal of prior
Liens, and all reasonable and related expenditures so made of every kind and
character shall be a Reimbursable Expense (which obligation WI Owner hereby
expressly promises to pay on demand) owing by WI Owner to Royalty Owner and
shall bear interest from the date demanded until paid at the Default Rate.

                                       14
<PAGE>

                                                                    EXHIBIT 10.4

      Section 8.6 No Partition. WI Owner and Royalty Owner acknowledge that
neither has any right or interest that would permit it to partition any portion
of the Subject Interests as against the other, and each waives any such right.

      Section 8.7 Notices and Addresses. All notices and other communications
required or permitted under this Conveyance shall be writing and, unless
otherwise specifically provided, shall be delivered personally or by telecopier
or by registered or certified mail, postage prepaid, or by delivery service with
proof of delivery, at the respective addresses shown below, and shall be deemed
delivered on the date of the receipt. Either party may specify as its proper
address any other street address within the continental limits of the United
States by giving notice to the other party, in the manner provided in this
section, at least fifteen (15) days prior to the effective date of such change
of address.

WI Owner's address:

      Ensource Reserves Management LLC
      ____________________________________
      ____________________________________
      ____________________________________
      Attention: _________________________
      Telephone: _________________________
      Telecopy: __________________________

Royalty Owner's Address:

      Ensource Energy Income Fund LP
      ____________________________________
      ____________________________________
      ____________________________________
      Attention: _________________________
      Telephone: _________________________
      Telecopy: __________________________

      Section 8.8 Consents, Waivers, Supplements and Amendments. No consent,
waiver, supplement or amendment given by Royalty Owner in connection with this
Conveyance or the Net Profits Interest shall be valid or effective unless given
in writing and signed by Royalty Owner.

      Section 8.9 Unenforceable or Inapplicable Provisions. If any provision of
this Conveyance is invalid or unenforceable under any applicable Law, the other
provisions hereof shall remain in full force and effect and the remaining
provisions shall be liberally construed in order to carry out the intent of this
Conveyance. The invalidity of any provision of this Conveyance in any
jurisdiction shall not affect the validity and enforceability of such provision
in any other jurisdiction.

      Section 8.10 Recording References. All recording references in Exhibit "A"
are to the official real property records of the county or parish in which the
affected land is located.

                                       15
<PAGE>

                                                                    EXHIBIT 10.4

      Section 8.11 Counterparts. This Conveyance may be executed in several
original counterparts. To facilitate filing and recording, there may be omitted
from certain counterparts the parts of Exhibit "A" hereto containing specific
descriptions of certain Subject Interests or Subject Lands which relate to lands
located in counties or parishes other than the office or county or parish in
which the particular counterpart is to be filed or recorded. Each counterpart
shall be deemed to be an original for all purposes, and all counterparts shall
together constitute but one and the same instrument. A complete counterpart of
this Conveyance, including all descriptions of the Subject Interests, shall be
kept in the offices of Royalty Owner.

                      [SIGNATURES APPEAR ON FOLLOWING PAGE]

                                       16
<PAGE>

      IN WITNESS WHEREOF, this Conveyance is executed and delivered on the ____
day of _______________, 2005 and is made effective as of the Commencement Time.

WITNESSES:                              "WI OWNER"

                                        Ensource Reserves Management LLC

____________________________________
Printed Name:_______________________    By:____________________________________
                                        Name:__________________________________
                                        Title:_________________________________

____________________________________
Printed Name:_______________________

WITNESSES:                              "ROYALTY OWNER"

                                        Ensource Energy Income Fund LP

                                        By: Ensource Energy Partners, LP, its
                                            General Partner

____________________________________
Printed Name:_______________________
                                        By:____________________________________
                                        Name:__________________________________
                                        Title:_________________________________
____________________________________
Printed Name:_______________________

                                       17
<PAGE>

                                ACKNOWLEDGEMENTS

STATE OF                  Section
                          Section
COUNTY OF                 Section

      This instrument was acknowledged before me on this ____ day of
___________, 20____, by ______________________, as _______________________ of
Ensource Reserves Management LLC, a Delaware limited liability company, on
behalf of said company.

                                         _____________________________________
                                         NOTARY PUBLIC, State of _____________

                                         _____________________________________
                                                    (printed name)

My commission expires:

____________________________________
            [SEAL]

STATE OF                   Section
                           Section
COUNTY OF                  Section

      This instrument was acknowledged before me on this ____ day of
___________, 20____, by ______________________, as _______________________ of
Ensource Energy Partners, LP, as general partner of Ensource Energy Income Fund
LP, a Delaware limited partnership, on behalf of said limited partnership.

                                         _____________________________________
                                         NOTARY PUBLIC, State of _____________

                                         _____________________________________
                                                     (printed name)

My commission expires:

____________________________________
            [SEAL]

                                       18

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