Document:

July 5, 2005

Shareholders and Board of Directors
Stone Mountain Resources, Inc
701 North Green Valley Parkway #200
Henderson, Nevada 89074

         Re:      Stone Mountain Resources, Inc.

Dear Sir/Madam:

This letter hereby serves as my notification to the shareholders and directors
of Stone Mountain Resources, Inc. of my resignation, effective immediately, from
my position as and as a member of the Board of Directors of Stone Mountain
Resources, Inc. This resignation is not due to a disagreement with Stone
Mountain Resources, Inc. on any matter relating to the Company's operations,
policies or practices. In accordance with this resignation, I hereby agree to
return my 8,000,000 shares of Stone Mountain Resources, Inc. to treasury.

Very truly yours,

/s/ Scott Young
SCOTT YOUNGANSLOW & JACLIN, LLP
                                195 ROUTE 9 SOUTH
                                    SUITE 204
                           MANALAPAN, NEW JERSEY 07726
                                 (732) 409-1212
                             TELEFAX (732) 577-1188

January 26, 2005

Peter Dodge, President
Stone Mountain, Inc.
701 North Green Valley Parkway Suite 200
Henderson, Nevada 89074

          Re:  Private Placement, Form SB-2 and Form 15c211 for OTC Bulletin
               Board Listing for Stone Mountain, Inc. ("Company")

Dear Mr. Dodge:

We are pleased that you wish to engage our firm to perform legal services as
stated above. From our experience, we have found that clients appreciate a frank
and open discussion and understanding of services that we will perform and the
basis upon which they will be expected to pay for these services. The Code of
Professional Responsibility as approved by the State of New Jersey (the "Rules")
required, inter alia that a lawyer's fee arrangement shall be communicated to
the client in writing before the lawyer renders substantial services to the
client. This letter ("Agreement") is written for that purpose.

You have engaged us to act as counsel for the Company with respect to the
preparation of and filing of a Form SB-2 with the SEC; preparation of a Form 211
for submission by an NASD member firm for an OTC Bulletin Board listing. You
have authorized us to perform all acts on behalf of such parties which are
necessary and appropriate to this representation. Fees for this matter
(exclusive of costs) are as follows:

1.   $7,500 upon execution of this Agreement.

2.   $30,000 when the Company is approved to quote on the Over the Counter
     Bulletin Board.

With respect to any other services that may be requested by the Company, not
included above, monthly bills are rendered based upon the expenditure of time
necessary to handle the matter at a basic hourly rate of the firm's lawyers who
render services in connection with such matters. The current hourly rate for the
legal services of Gregg E. Jaclin, the principal lawyer for this matter, is
$300.00. The current hourly rates for my partner, Richard I. Anslow is $375 per
hour; for our associates is $200 per hour; the current rate for law clerks and
legal assistants is $75 to $95 per hour. You will be requested to provide this
firm in advance with checks for any necessary filings or other applicable fees.
In addition, we shall bill for disbursements for the amount of out-of-pocket
expenses, such as travel, duplicating costs and overnight courier fees.

It is understood that you will be billed monthly for expenses incurred during
the previous month. If you are billed for any legal services or expenses, it is
understood that payment is due upon receipt of the bill. Legal billings unpaid
for more than 60 days from the date of invoice will be in arrears. This firm
will seek to withdraw from any matter in which the account is in excess of 30
days in arrears and a service charge of 18% per annum on the outstanding balance
will be imposed. If you have any disagreement about the amount of the bill or
any of the charges of work performed, you must advise us in writing within
thirty days; otherwise, you agree to the amount of your bill and the charges for
work performed at the date of the billing statement.

We may withdraw as counsel and terminate this Agreement by notifying you in
writing. Reasons for such termination may include, but are not limited to,
failure to pay fees or expenses (including required deposits) under the terms of
this Agreement, failure to cooperate with the firm in the engagement provided
for herein and reasons mandated by the Code of Professional Responsibility as
approved by the State of New Jersey. You may also terminate this Agreement by
notifying us in writing. Upon our withdrawal of the representation you shall
immediately pay any remaining balance owed on your account. In any of these
events, you agree to execute such documents as will permit us to withdraw.

In the event we are ultimately required to bring suit to collect any unpaid fees
and costs, you understand that you will be required to pay reasonable attorneys'
fees as well as legal interest on the amount of any fees or costs due us plus
finance charges on all delinquent charges. You also agree to the imposition of a
charging lien for any monies due us on all real and personal property that is
preserved, protected or obtained as a result of the representation undertaken
herein.

While we do not anticipate ever having to address this issue, any disputes
regarding the interpretation or enforcement of this Agreement shall be resolved
only by the Courts of the State of New Jersey, and Client and Attorney each
consent to the exclusive jurisdiction of the State of New Jersey, Monmouth
County, for the purposes of resolving any and all disputes arising from or in
any way relating to the subject matter of this Agreement. Each party waives
their respective right to bring any action in any court other than as provided
herein. The prevailing party in any action to construe or enforce the rights and
duties of the parties arising from or in any way relating to this Agreement
shall be entitled to reasonable attorneys' fees and costs incurred. The parties
agree that New Jersey law is to govern, construe and enforce all of the rights
and duties of the parties arising from or relating in any way to the subject
matter of this Agreement.

You hereby acknowledge that we are not representing any individual listed as a
shareholder, officer, director, advisor or the like for the Company. If the
foregoing is agreeable to you, please acknowledge your understanding and
agreement by countersigning this Agreement and returning it to us in the
enclosed envelope and we shall then commence our representation. If the
foregoing is agreeable to you, please acknowledge your understanding and
agreement by countersigning this Agreement and returning it to us with the
initial retainer of $7,500.

We appreciate your confidence in our firm and we assure you that we shall make
every effort to perform our services in a prompt and efficient manner.

Very truly yours,

ANSLOW & JACLIN, LLP

By:  /s/ Gregg E. Jaclin
------------------------------
         GREGG E. JACLIN

ACCEPTED AND AGREED TO BY:

STONE MOUNTAIN, INC.

BY:  /s/ Peter Dodge
-------------------------------
         PETER DODGEexh101

    Strachan
      Participation and Farmout Agreement

    

    made
      as
      of September 23, 2005

     

    Between:

     

       ODIN
      CAPITAL
      Inc.,
      a
      body
      corporate having an office at Calgary, Alberta ("Farmor")

     

     -
      and -

     

        Delta
      Oil and
      Gas Inc.,
      a body
      corporate having an office at Vancouver , B.C. ("Farmee")

     

    

     

    Whereas
      Farmor
      has the right to participate in a Leduc formation test well located in Section
      9, Township 38, Range 9, West of the 5th
      Meridian
      ("Section
      9");
      and

     

    Whereas
      Farmee
      wishes to participate for four percent (4.000%) share of the costs of drilling
      a
      test well into the Leduc formation under Section 9; and

     

    Now
      Therefore In Consideration
      of the
      premises hereto and the mutual covenants and agreements herein set forth,
This
      Agreement Witnesseth:

     

     

    Definitions

     

    1.1  In
      this
      Agreement the words and phrases which are defined terms in the Farmout Procedure
      shall, provided that they are not inconsistent with the definitions set forth
      in
      this Agreement, have the meanings ascribed to them in the Farmout Procedure
      and,
      in addition thereto, the following words and phrases shall have the meanings
      hereinafter ascribed to them:

     

    "Area
      of Mutual Interest"
      means
      section 8-38-9-W5M.

     

    "Contract
      Depth"
      means a
      depth sufficient to penetrate thirty (30) meters into the Leduc formation or
      a
      depth of Four Thousand and fifty (4,050) meters subsurface, whichever shall
      be
      the lesser.

     

    "Earning
      Well"
      means
      the well to be drilled at 14 of 9-38-9-W5M.

     

    "Farmin
      Interest"
      means
      four percent (4.000%) farmin cost interest
      Farmee has agreed to pay with respect to the drilling of the Earning
      Well.

     

    "Farmout
      Lands"
      means
      the lands and leases more particularly described in Schedule "A" attached
      hereto.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    "Farmout
      Procedure"
      means
      those portions of the 1997 CAPL Farmout and Royalty Procedure which are adopted
      by this Agreement, the elections for which are more particularly set forth
      in
      Schedule "B" attached hereto.

     

    "Operating
      Procedure"
      means a
      standard 1990 CAPL operating procedure and 1988 PASWC Accounting Procedure
      encompassing the rates and elections set forth in the attached Schedule “D”.

     

    "Strachan
      AFE"
      means
      the authority for expenditure generated by Farmor with respect to the drilling
      of the Earning Well, a copy of which is attached as Schedule "C".

     

    1.2  The
      following Schedules are attached to and incorporated as part of this
      Agreement:

     

    Schedule
      "A" - Farmout
      Lands

     

    Schedule
      "B" - Elections
      for Farmout Procedure

     

    Schedule
      "C" - Strachan
      AFE

     

    Schedule
      “D” - Elections
      for Operating Procedure

     

    1.3  In
      the
      event of a conflict between a provision or term of the Agreement and a provision
      or term of the Operating Procedure or a provision or term of a Schedule, the
      provision or term of this Agreement shall prevail.

     

    ARTICLE
      2

     

    Application
      of Farmout Procedure

     

    2.1 The
      following provisions of the Farmout Procedure shall apply:

     

    Clauses
      1.01 Definitions and 1.02 Incorporation of Provisions from 1990 CAPL Operating
      Procedure;

     

    Article
      2.00 - Title and Encumbrances;

     

    Article
      5.00 - Overriding Royalty;

     

    Article
      6.00 - Conversion of Overriding Royalty;

     

    Article
      8.00 - Area of Mutual Interest;

     

    Article
      11.00 - Land Maintenance Costs;

     

    Article
      12.00 - Assignment;

     

    Article
      15.00 - Dispute Resolution; and

     

    Article
      16.00 - Goods and Services Taxes. 

    
    

    
    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

     

    ARTICLE
      3

     

    Farmout
      Provisions

     

    3.1 The
      Farmor anticipates that the Earning Well will be Spudded on or before October
      15, 2005 The parties hereto acknowledge that the operator of the Earning Well
      is
      Rosetta Exploration Inc. (hereinafter referred to as the
“Operator”).

     

    3.2 The
      Farmee acknowledges receipt of a copy of the Strachan AFE and approves the
      drilling and casing or Abandonment of the Earning Well based upon the Strachan
      AFE. The Farmee agrees to participate and pay for its Farmin Interest share
      of
      the costs of drilling the Earning Well to Contract Depth and, subject to the
      provisions herein set forth, its Farmin Interest share of the costs of the
      Completion, Capping or Abandonment of the Earning Well. The Farmee shall,
      provided that it elects to participate in the Completion and Equipping of the
      Earning Well, be responsible to pay its Farmin Interest share of all subsequent
      authorities for expenditure and costs which relate to the Completion and
      Equipping of the Earning Well. The Operator has arranged blow out insurance
      with
      respect to the Earning Well and has included the Farmor and Farmee in the
      coverage. The cost of the blow out insurance is in addition to the costs shown
      on the Strachan AFE and the Farmee agrees to pay its Farmin Interest share
      of
      such costs. Farmee will pay a cash call advance to Farmor of one hundred and
      ten
      percent (110%) of its Farmin Interest share of the costs shown on the Strachan
      AFE as well as the estimated costs of the blowout insurance, both of which
      are
      to be received by Farmor six (6) days before the drilling rig begins to move.
      The anticipated commencement date for the drilling rig to move is October
      1, 2005.
      The
      Farmor will immediately advise the Farmee of any change in the date. If payment
      of the cash call is not received by the Farmor within the time set forth above
      then, at the Farmor’s option, this Agreement will be terminated and of no force
      and effect.

     

    3.3 The
      Farmor shall provide notice to the Farmee with respect to the Spudding of the
      Earning Well. 

     

    3.4 If
      the
      Earning Well has been drilled to Contract Depth and if Petroleum Substances
      are
      not reasonably anticipated to be present in Paying Quantities from any zone
      in
      the Earning Well, the Farmor shall promptly comply with the provisions of
      Article 4.

     

    
      3.5 If
        the Earning Well has been drilled to Contract Depth and if Petroleum Substances
        from any zone in the Earning Well are reasonably anticipated to be present
        in
        Paying Quantities, the Farmor will advise the Operator of the Farmor and
        Farmee’s desire to set production casing and participate in Production Tests.
        However, if those Petroleum Substances are composed predominantly of natural
        gas
        and the Operator intends to Cap the well and to delay those Production Tests,
        the Farmor must give notice to the Farmee of that intention and the reasons
        for
        that proposed delay upon receipt of same from the Operator. Unless the Farmee
        reasonably objects to that proposed delay within three (3) days of the receipt
        of that notice, the Farmor may advise the Operator that it may Cap the Earning
        Well, in which case the Operator will conduct those tests on or before the
        later
        of the second (2nd) anniversary date of the Earning Well drilling rig release
        or
        as soon as practicable after an economic market for the affected Petroleum
        Substances becomes available, provided that any dispute respecting the
        reasonableness of the

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       Farmee's
        objection to that proposed delay or the availability of an economic market
        will
        be resolved pursuant to Article 15 of the Farmout Procedure. If the Operator
        has
        not conducted those Production Tests within two (2) years of the drilling
        rig
        release of the Earning Well, the Operator will, at the end of that year and
        every two (2) years thereafter until the Operator has conducted those tests,
        give notice to the Farmee of an intention to delay further the conduct of
        the
        Production Tests and the reasons for that proposed delay, in which case the
        preceding sentence will apply mutatis mutandis to each such notice.
        When the Operator has conducted those Production Tests, the Operator will
        Complete or Abandon the Earning Well as soon as practicable.

       

    

    3.6 If
      the
      Operator encounters mechanical difficulties or impenetrable formations that,
      in
      the Operator's reasonable opinion, make further drilling of the Earning Well
      impractical prior to attaining the Contract Depth, the Operator will immediately
      give notice to the Farmor of those circumstances and the Operator's intention
      to
      Abandon the Earning Well. The Farmor shall immediately provide such notice
      to
      the Farmee. The Operator will Abandon that well subject to Article 4, provided
      that the first sentence of Clause 4.1 will not apply if the Farmor and Farmee
      earn an interest in the Farmout Lands by virtue of a substitute well. If the
      Operator elects to Spud a substitute Earning Well on the Farmout Lands it shall
      provide notice of its intention, which notice shall include a description of
      the
      proposed location, the proposed date of Spudding, and an updated authority
      for
      expenditure with respect to the costs of drilling and setting of casing or
      abandonment of the Earning Well. This notice will be immediately provided to
      the
      Farmee by the Farmor. The Farmee shall have fifteen (15) days from receipt
      of
      the Operator's notice to drill the substitute well to elect whether or not
      it
      wishes to participate in the substitute well as to its Farmin Interest. If
      it
      does not advise the Farmor that it elects to participate within fifteen (15)
      days of the receipt of the notice of drilling the substitute well then it will
      be deemed to have elected not to participate in the substitute well and no
      earning shall have occurred and this Agreement shall be terminated and of no
      force and effect. If it elects to participate all rights and obligations
      applicable to the Earning Well will apply in the same manner to the substitute
      well. 

     

    3.7 If
      the
      Earning Well has been drilled to Contract Depth and Completed, Capped or
      Abandoned and the Farmee is not in default of any of its obligations with
      respect to the Earning Well, it will have earned:

     

    (a ) 
      in
      the
      Spacing Unit for the Earning Well:

     

    i) 
      a
      2.000%
      interest in the petroleum and natural gas below the base of the Mannville
      excluding natural gas in the Leduc formation; and

     

    ii) 
      a
      4.000%
      interest in the natural gas in the Leduc formation before payout subject to
      payment of the Overriding Royalty which is convertible upon payout at royalty
      owners option to 50% of the Farmee’s Interest; and

     

    (b) 
      a
      1.600%
      interest
      in the rights below the base of the Shunda formation in Section 10, Township
      38,
      Range 9W5M.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    (c) 
      a
      1.289%
      interest in the rights below the base of the Shunda formation in Sections 15
      and
      16, Township 38, Range 9W5M. down to the base of the deepest formation
      penetrated.

     

    The
      Operator shall pay all royalties with respect to the Farmin Interest which
      attach to the interest earned by the Farmee on the Spacing Unit for the Earning
      Well as shown in Schedule "A" hereto.

     

    3.8 If
      the
      Earning Well is Capped and the Farmee participates in the Capping then the
      Farmee shall pay its Farmin Interest share of all costs and expenses required
      to
      finish Completing or Abandoning the well.

     

    3.9 If
      the
      Farmee participates in the completion of the Earning Well then the Farmee shall
      also pay its Farmin Interest share of the costs and expenses to Equip the
      Earning Well to place the well on production.

     

    3.10 If
      transportation, compression, processing or other facilities are required to
      produce Petroleum Substances from the Earning Well,
      then,
      after consultation with the Farmee, the Farmor shall provide to the Farmee
      an
      authority for expenditure and a cash call with respect to its Farmin Interest.
      If the Farmee does not pay a cash call in full at least ten (10) days prior
      to
      the start of construction operations relating to the operation set forth in
      the
      applicable authority for expenditure, Farmee will be deemed to have elected
      to
      not participate in the operation described in the authority for expenditure.
      If
      the Farmee elects or is deemed to have elected not to participate in the
      construction of a facility, then the owner of the facility will charge the
      Farmee a fee for the use of the facility. 

     

    3.11 Prior
      to
      December 31, 2006 no party shall be entitled to propose any independent
      operation pursuant to Article X of under the Operating Procedure which applies
      between the parties with respect to any of the Farmout Lands in which the Farmee
      has earned an interest ("Joint
      Lands").
      Provided however that if, after consultation with the other party, one but
      not
      both parties wishes to drill a well ("Drilling
      Party")
      on the
      Joint Lands, then it shall provide a written notice ("Drilling
      Notice")
      to the
      other party ("Receiving
      Party")
      which
      shall set forth:

     

    the
      location and target depth of the well,

     

    the
      estimated costs to drill and case or Abandon the well,

     

    the
      anticipated Spud date for the well, and

     

    a
      copy of
      the proposed drilling and completion program for the well.

     

    The
      Receiving Party shall have twenty (20) days after receipt of the Drilling Notice
      to advise the Drilling Party whether or not it wishes to participate in the
      drilling of the well. Failure to advise the Drilling Party of its election
      within the twenty (20) day period will be deemed to be an election not to
      participate in the well. If the Receiving Party elects or is deemed to have
      elected not to participate, then the Receiving Party will be deemed to have
      farmed out its interest to the Drilling Party and the Drilling Party will upon
      the drilling of the well at the location and to the depth set forth in the
      Drilling Notice have earned one hundred percent (100%) of the
      Receiving

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    Party's
      interest in the drilling Spacing Unit for the well subject to the reservation
      of
      the Overriding Royalty. If the well is not spudded within ninety (90) days
      of
      the receipt of the Drilling Notice by the Receiving Party, then the well shall
      not be spudded unless another Drilling Notice is delivered to the Receiving
      Party. 

     

    3.12 The
      parties acknowledge that the Farmor has also executed a Farmout and
      Participation Agreement with the Operator relating to the Farmout Lands. The
      parties further acknowledge that the Operator has entered into a joint venture
      and farmout agreements with third party entities ("Third Party Entities")
      whereby Third Party Entities have agreed to participate in the drilling of
      the
      Earning Well and accordingly the Farmor and the Operator are obligated to
      provide notice to Third Party Entities if it wishes to set casing in the well
      and conduct Production Tests or if it wishes to Abandon the Earning Well. If
      the
      Operator wants to Abandon the Earning Well but any or all of Farmor, Farmee,
      and
      Third Party Entities wish to take over the Earning Well then each of the Farmor,
      Farmee, and the Third Party Entities shall be entitled to acquire the interest
      owned by the Operator in the Earning Well which shall be shared proportionally
      between or among the Third Party Entities who elect to take over the well,
      on
      the basis that their participating interests relate to one another.

     

    3.13 If
      the
      Operator decides to Abandon the Earning Well and none of the Farmor, Farmee
      or
      Third Party Entities elect to take over the Earning Well, then the well will
      be
      Abandoned and the Farmee shall pay its Farmin Interest share of the Abandonment
      costs.

     

    3.14 The
      Area
      of Mutual Interest will apply until December 31, 2007, the provisions of Article
      8 in the Farmout Procedure shall apply and the Farmee shall be entitled to
      participate in the Area of Mutual Interest as to an undivided 2.464% interest.
      If the Farmee does not earn an interest in the Farmout Lands then the Area
      of
      Mutual Interest will terminate as of the date that the Farmee's right to earn
      an
      interest terminates.

     

    3.15 In
      the
      event that the Operator serves a supplemental Authorization for Expenditure
      covering cost overruns on the Earning Well, the supplemental AFE shall be
      immediately forwarded to the Farmee with a cash call. If payment of the cash
      call is not received in full by the Farmor on or within twenty (20) days from
      receipt by Farmee, the Farmee shall be deemed to have elected to not participate
      in the operation and any interest to be earned or rights granted hereunder
      shall
      be forfeited and this Agreement shall be terminated and of no force and
      effect.

     

    ARTICLE
      4

    Abandonment
      of Wells

     

    4.1 If
      the
      Earning Well has been drilled to Contract Depth, but the Earning Well is not
      Completed and no Operating Agreement applies between the Farmor and the Farmee
      with respect to the Earning Well, the Farmor shall give notice to the Farmee
      if
      the Farmor intends to Abandon that Earning Well. If, within twelve (12) hours
      following the Farmee's receipt of that notice and information from the Farmor
      when a rig is located on the wellsite, or within ten (10) days of the Farmee's
      receipt of that notice and information in any other case:

     

    (a)  the
      Farmee fails to reply to the Farmor or gives notice to the Farmor that it
      consents to the Abandonment of that well, the Farmor will
      promptly advise the

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

      Operator
      to abandon the
      wellbore of that well and conduct its reclamation work in a timely
      manner;

     

    (b)
      the
      Farmee gives notice to the Farmor that it wishes to take over that well, the
      Farmor will, effective as of the date of the Farmee's election to take over
      that
      well and subject to the provisions of Clause 3.12 of this Agreement, assign
      that
      well (including the material equipment and surface access rights relating solely
      thereto that the Farmee wishes to use) to the Farmee, without warranty. The
      Farmor will be released from all obligations and liabilities accruing for the
      property assigned to the Farmee pursuant to this Clause following that
      assignment. However, that assignment will not release the Farmor from any
      liability that may have accrued to it prior to that assignment.

     

    4.2 If
      the
      Farmee takes over a well pursuant to this Article, the Farmee will Complete
      or
      Abandon the well at its own cost and expense and it will save harmless the
      Farmor from all costs and expenses relating to the Abandonment of the
      Well.

     

    4.3 If
      the
      Farmee successfully Completes the well in a zone originally contained in the
      Farmout Lands, the Farmor will assign to the Farmee, without warranty, the
      Farmor's Working Interest in the Spacing Unit for that well in only the zone(s)
      Completed by the Farmee and the Petroleum Substances therein, effective as
      of
      the date of the Farmee's election to take over that well. That assignment will
      not release the Farmor from any obligation that should have been performed
      by it
      or any liability that may have accrued to it prior to that assignment. If the
      Farmee does not Complete the well in a zone originally contained in the Farmout
      Lands, the Farmor will not be required to make an assignment to the Farmee
      pursuant to this Clause.

     

    4.4 From
      and
      after the effective date referred to in Clause 4.3, the Operating Procedure
      will
      apply mutatis
      mutandis
      to the
      Farmee Parties respecting a well taken over pursuant to Clause 4.4 and the
      applicable zone(s) of the Spacing Unit, provided that the Overriding Royalty
      will not be payable for that well until such time as the production penalty
      prescribed by the Operating Procedure for that operation is recovered or ceases
      to apply. At that time, each Farmee Party that elected not to participate in
      the
      takeover of that well may elect to convert to a Working Interest in that well
      on
      the same basis as is provided in Article 6.00 of the Farmout Procedure. The
      Farmee Parties will appoint one of them to be the initial Operator under the
      Operating Procedure. If no Operating Procedure is included in the Agreement,
      the
      term "Operating Procedure" in this Clause means the standard form 1990 CAPL
      Operating Procedure and as an attachment thereto the standard form 1988 PASC
      Accounting Procedure, with those rates and elections as the Farmee Parties
      taking over that well may negotiate at the required time.

     

    4.5 The
      provisions of this Article will apply in the same manner to any Royalty Well
      on
      the Royalty Lands that is not an Earning Well, subject to the following
      conditions:

     

    (a)
      the
      Royalty Owner only has the right to take over that Royalty Well if it then
      retains a right to convert its Overriding Royalty to a Working Interest in
      an
      Earning Well under Article 6.00; and

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    (b)
      the
      Royalty Owner does not have the right to elect to take over that Royalty Well
      until the Parties holding Working Interests in that well have all elected to
      Abandon that well.

     

    ARTICLE
      5

    Miscellaneous

     

    5.1 This
      Agreement shall, in all respects, be subject to and be interpreted, construed
      and enforced in accordance with the laws in effect in the Province of Alberta.
      Each party hereto irrevocably accepts and submits to the exclusive jurisdiction
      of the courts of the Province of Alberta and all courts of appeal
      therefrom.

     

    5.2 Time
      shall be of the essence of this Agreement.

     

    5.3 The
      address for notices of each of the parties hereto shall be as
      follows:.

     

    Farmor: Odin
      Capital Inc.

    P.O
      Box 36007

    Lakeview
      RPO - 6449 Crowchild Trail S.W.

    Calgary,
      Alberta T3E 7C6

    Attention:
      Matthew Philipchuk

    

    Fax: (403)
      246-7935

     

    Farmee: Delta
      Oil and Gas Inc.

    Suite
      300 - 1055 West Hastings Street

    Vancouver
      , B.C. V6E 2E9

    Attention:
      Douglas Bolan

    

    Fax: 

     

    Any
      of
      the parties hereto may from time to time change its address for service herein
      by giving written notice to the other parties hereto. Any notice may be served
      by personal service upon a party hereto or by mailing the same by prepaid post
      in a property addressed envelope addressed to the party hereto at its address
      for service hereunder. Any notice given by service upon a party hereto shall
      be
      deemed to be given on the date of such service and any notice given by mail
      shall be received by the addressee when actually received. Any notice may be
      served by instantaneous electronic means to the number for notice herein set
      forth. Any notice given by service upon a party and any notice given by
      instantaneous electronic means shall be deemed to be given to and received
      by
      the addressee on the day (except Saturdays, Sundays, statutory holidays and
      days
      which the offices of the addressee are closed for business) of service or after
      the sending thereof with appropriate answerback acknowledgment, provided it
      was
      sent before 2:00 p.m.; otherwise it shall be deemed to be received the next
      following business day.

     

    5.4 This
      Agreement may be amended only by written instrument signed by all parties
      hereto.

     

    5.5 The
      Farmor shall be entitled to transfer and assign a portion of its interest to
      a
      third party provided however that:

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    (a)
      prior
      to
      earning the Farmor will only look to the Farmee for performance;
      and

     

    (b)
      after
      earning the Farmee may assign its interest with the consent of the Farmor which
      consent will not be unreasonably withheld.

     

    5.6 This
      Agreement shall be binding upon and shall enure to the benefit of the parties
      hereto and their respective successors.

     

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

     

    ODIN
      CAPITAL INC.

     

    Per: /s/
      Matthew Philipchuk

    

     

    Delta
      Oil and Gas Inc.

     

    Per: /s/
      Douglas Bolen 

    

    Per:
       

    

    

    
 

    This
      is the signature page attached to and forming part of a Farmin Particiaption
      Agreement dated September 23, 2005 between Odin Capital Inc. and Delta Oil
      and
      Gas Inc. (Strachan Area, Alberta)

    
      
        
           

        

        
        

      

      
        9

        
          

        

      

      
        
        

        - -

      

    

    Schedule
      "A" 

    attached
      to and forming part of the Strachan Participation and Farmout Agreement made
      as
      of September 23, 2005 between Odin Capital Inc. and Delta Oil and Gas
      Inc.

    

    

    

    

    

    

    

    

    

    

    

    

    

    Farmout
      Lands

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    (This
      Schedule consists of 2 pages, including this page)

    

    

    

    

    

    

    

    

    

    

    

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    FARMOUT
      LANDS

     

    

    
      	
               

              Title
                Documents

            	
               

              Lands

            	
              Farmee’s

              Earned
                WI* 

              and
                Owned 

              WI

            	
               

              Encumbrances

            
	
               

              Crown
                P&NG Licence

              No.
                5596020176

               

            	
               

              Twp.
                38 Rge. 9 W5M Sec 9

              Natural
                Gas in the Leduc

               

            	
               

              4.000%BPO

              2.000%APO

               

            	
               

              1)
                Crown S/S 

              2)
                3.5% NCGORR to Calgary International Energy

              3)
                *5.0% NCGORR to Northrock and TKE (APO only)

              4)
                12% ORR to Rosetta convertible at payout

            
	
               

              Crown
                P&NG Lease

              No.
                0604120298

               

            	
               

              Twp.
                38 Rge. 9 W5M Sec 9

              P&NG
                below the base of the Mannville excluding natural gas in the
                Leduc

               

            	
               

              2.000%

               

            	
               

              1)
                Crown S/S

              2)
                3.5% NCGORR to Calgary International Energy

              3)
                *5.0% NCGORR to Northrock and TKE (APO only)

            
	
               

              Crown
                P&NG Licence

              No.
                5596020176

               

            	
               

              Twp.
                38 Rge. 9 W5M Sec 10

              P&NG
                below base Shunda

               

               

               

            	
               

              1.600%

               

            	
               

              1)
                Crown S/S

              2)
                3.5% NCGORR to Calgary International Energy 

              3)
                *5.0% NCGORR to Northrock and TKE (APO only)

               

            
	
               

              Crown
                P&NG Licence

              No.
                5596020176

               

            	
               

              Twp.
                38 Rge. 9 W5M Sec 15 & 16

              P&NG
                below base Shunda

               

               

               

               

            	
               

              1.289%

               

            	
               

              1)
                Crown S/S

              2)
                3.5% NCGORR to Calgary International Energy

              3)
                *5.0% NCGORR to Northrock and TKE (APO
                only)

            

    

     

    *
      Contingent on Farmor earning under the Northrock Farmout Agreement.

    

    

     

    
      
        
          198033\680387.v3 

        

        
        

      

      
        11

        
          

        

      

      
        
        

        - -

      

    

    Schedule
      “B”

    attached
      to and forming part of the Strachan Participation and Farmout Agreement made
      as
      of September 23, 2005 between Odin Capital Inc. and Delta Oil and Gas
      Inc.

    

    

    

     

    

    Elections
      for Farmout Procedure

    

     

    

    (This
      Schedule consists of 2 pages, including this page)

    
      
        
          198033\680387.v3 

        

        
        

      

      
        12

        
          

        

      

      
        
        

        
          -
            -

        

      

    

     

     

    1997
      CAPL FARMOUT & ROYALTY PROCEDURE

    ELECTION
      SHEET

    

    1. Effective
      Date (Subclause 1.01(f)) -
      September 23, 2005

    2. Payout
      (Subclause 1.01(t), if Article 6.00 applies) -  Alternate
      -
A

    

    3. Incorporation
      of Clauses from 1990 CAPL Operating Procedure (Clause 1.02)*

    (i)
      Insurance (311) Alternate
      -
A

    

    4. Article
      4.00 (Option Wells) will
      apply
      

    

    5. Article
      5.00 (Overriding Royalty) will
      apply

    

    6. Quantification
      of Overriding Royalty (Subclause 5.01A, if applicable)

    

    (i)
      Crude
      Oil
 (a) -
      Alternate 
      1 - 12%

    

    (ii)
      Other        (b) -
      Alternate 
      1 - 12%

    

    7. Permitted
      Deductions (Subclause 5.04B, if applicable) - Alternate
      1

    

    8.
       Article
      6.00 (Conversion of Overriding Royalty) will
      apply
      

    If
      Article 6.00 applies, conversion will be to:

    

    
      	 	
              (a)

            	
              50%
                of original interest 

            

    

    9. Article
      8.00 (Area of Mutual Interest) will
      apply

    

    10.
      Reimbursement
      of Land Maintenance Costs (Clause 11.02) will
      not
      apply

    

    

    

    
      
        
           

        

        
        

      

      
        13

        
          

        

      

      
        
        

        - -

      

    

    Schedule
      “C”

    attached
      to and forming part of the Strachan Participation and Farmout Agreement made
      as
      of September 23, 2005 between Odin Capital Inc. and Delta Oil and Gas
      Inc.

    

     

    
 

    Strachan
      AFE

    

    

     

    

    (This
      Schedule consists of 2 pages, including this page)

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

    

      

    

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    Schedule
      “D”

    attached
      to and forming part of the Strachan Participation and Farmout Agreement made
      as
      of September 23, 2005 between Odin Capital Inc. and Delta Oil and Gas
      Inc.

    

     

    

    Operating
      Procedure and Accounting Procedure Elections

    

    

    

    

    

    (This
      Schedule consists of 2 pages, including this page)

    

    

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    1990
      C.A.P.L. OPERATING PROCEDURE

     

    

    Clause
      311: INSURANCE:
      Alternate
      A

    

    Clause
      604:  MARKETING
      FEE: Alternate
      A  

    

    Clause
      903:  CASING
      POINT ELECTION: Alternate
      A  

     

    Clause
      1007:  PENALTY
      WHERE INDEPENDENT WELL RESULTS IN PRODUCTION:

    Development
      Wells  300%
      

    Exploratory
      Wells    
      500% 

    

    Clause
      1010(a)(iv): TITLE
      PRESERVING PERIOD:  180
      days

    

    Clause
      2401: DISPOSITION
      OF INTERESTS: Alternate
      A

    

    1988
      P.A.S.C. ACCOUNTING PROCEDURE

    

    Clause
      105: OPERATING
      FUND: 10%

    

    Clause
      110: APPROVALS: 2
      or more totalling 65%

    

    Clause
      202(b): Not
      Chargeable

    

    Clause
      203(b): Employee
      Benefits: 25%

    

    Clause
      205(b): ENGINEERING
      AND/OR DESIGN: Delete
      in its entirety.

    

    Clause
      217 2.5%
      for
      tubular goods 50.8 mm and over and other items with new price over $5,000

    5%
      of
      the
      cost of all other material 

    

    Clause
      302: OVERHEAD
      RATES:

     

    (A) Exploration
      Project    
       (D)
      OPERATIONS AND MAINTENANCE

    
      	 	
              (1)
                5%
                of
                first
                $50,000                         
                 (1)
                10%
                of
                Cost; and

            

    

    (2)
      3%
      of next
      $100,000      (2) 
      $125 for
      Producing Well per month

    (3)
      1%
      of
      excess  

     (B) Drilling
      Well 

    (1) 3%
      of first
$50,000 

    (2) 2%
      of next
$100,000; 

    (3) 1%
      Excess 

    (C) Construction 

    
      	 	
              (1)
                5% of
                first $50,000

            

    

    (2) 3% of
      next $100,000 

    (3) 1%
      Excess   

    Subclauses
      302(e)(2) or 302(e)(3): shall
      not.
      be
      adjusted

    

    Pricing
      of Joint Material Purchases, Transfers and Dispositions: $25,000
      for
      requiring approval

    

    Inventories
      by Operator at 5
      year
      intervals or upon the request of a Non Operator.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}]]