Document:

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                                                                   Exhibit 10.81

                              GAS SALES AGREEMENT
                              -------------------

THIS GAS SALES AGREEMENT is made the 28th day of September, 2001.

BETWEEN:

1.   Tipperary Oil & Gas (Australia) Pty Ltd (ACN 077 536 871) of GPO Box 1100,
     Brisbane, Queensland, Australia 4001 ("Seller").

2.   QUEENSLAND FERTILISER ASSETS LIMITED (ACN 011 062 294) of 76 Arthur Street,
     Roma, Queensland, Australia ("Buyer").

RECITALS:

A.   The Buyer: (i) proposes to construct, commission, own and operate, a
     facility to produce approximately 1,000 metric tons of ammonia per day,
     plus urea, nitric acid and low density ammonium nitrate ("Products") at
     Pickanjinnie, Queensland, Australia ("Plant"); and (ii) wishes to purchase
     certain quantities of Gas from the Seller for the operation of that Plant.

B.   The Seller wishes to sell and supply Gas to the Buyer, in consideration for
     the Buyer paying for Gas, subject to the terms and conditions of this
     Agreement.

IT IS AGREED:

1.0  DEFINITIONS AND INTERPRETATION

1.1  In addition to the other defined terms contained elsewhere in this
     Agreement (including its Recitals), the following terms shall have the
     meanings assigned below unless the context otherwise requires.

     "Accumulated Annual Makeup" means at any relevant time, the aggregate of
     the Annual Makeup Quantities accruing during each of the immediately
     preceding three Contract Years (or such lesser period as the context
     requires), less all  Annual Makeup Quantities Buyer has received during
     that period.

     "ACQ" means the annual contract quantity of Gas to be delivered by the
     Seller to the Buyer in a Contract Year up to 13.0 PJ's of Gas for the First
     Contract Year and 13.0 PJ's of Gas for each Contract Year thereafter.

     "ADQ" means the average daily quantity of Gas (being 37.2 TJ's of Gas) to
     be delivered by the Seller to the Buyer that is required to operate the
     Plant at its initial design capacity for each Day that the Plant is open
     and conducting operations.
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     "Affected Party" has the meaning given in Clause 16.1.
                                               -----------

     "Agreement" means this agreement including any schedules, annexures,
     appendixes or other documents attached to this agreement or incorporated by
     reference.

     "Annual Makeup" means the Annual Makeup Payment and the Annual Makeup
     Quantity, collectively.

     "Annual Makeup Payment" means in respect of one Contract Year, the amount
     of money, if any, paid by Buyer to Seller equal to the product of (a) the
     Annual Makeup Quantity times (b) the Gas Price.

     "Annual Makeup Quantity" means in respect of one Contract Year, the amount
     of Gas (expressed in GJ's), if any, by which the Take or Pay Quantity
     exceeds the quantity of Gas taken by the Buyer in that Contract Year.

     "Authorization" means any consent, authorization, registration, filing,
     recording, notarization, certificate, permission, license, approval,
     permit, authority, exception, ruling or waiver by a Governmental Agency.

     "BB Rate" means the rate of interest percent per annum which is the 180 day
     dealer bill rate as it may be published from time to time in the Australian
     Financial Review provided that:

     (a)  if at any time that rate ceases to be published, then the BB Rate will
          be the rate published by the Australia and New Zealand Bank, Sydney,
          New South Wales, from time to time as its prime lending rate (which
          may not be the lowest effective interest rate charged by that bank);
          and

     (b)  if the Australia and New Zealand Bank, Sydney, New South Wales,
          should, for any reason, cease to exist, or cease to publish a prime
          lending rate, Seller and Buyer shall designate an alternate
          international bank that routinely publishes prime lending rates.

     "Business Day" means any day other than a Saturday, Sunday or public bank
     holiday in Brisbane, Queensland.

     "Buyer's Pipeline" means the gas pipeline which may be built by the Buyer
     to transport Gas from the Delivery Point to the Plant.

                                       2
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     "Buyer's Representative" means the person whose name appears in Clause 21.2
                                                                     -----------
     (or any other replacement as may be advised by the Buyer to the Seller from
     time to time), being the person authorised by the Buyer to issue the
     Monthly Schedule and variations to a Nominated Daily Take on behalf of the
     Buyer and to otherwise manage the administration of this Agreement.

     "Comet Ridge Project" means the area of land covered by Authority to
     Prospect No. 526 and Petroleum Leases Nos. 90, 91, 92, 99 and 100 in and
     adjacent to the Fairview area of Queensland.

     "Commencement Date" means the later of:

     (a)  1 April 2004; or

     (b)  the date after 1 April 2004 on which the Buyer takes the first
          delivery of Gas from the Seller under this Agreement pursuant to the
          notice given under Clause 2.4;
                             ----------

     provided that, if Buyer has not previously taken the first delivery of Gas
     -------------
     from the Seller under Subparagraph (b) above, the Commencement Date shall
     be deemed to occur on 1 November 2004.

     "Confidential Information" means all information regarding the current or
     future business interests, methodology or affairs of the Seller and Buyer
     including:

     (a)  matters of a technical nature;

     (b)  research and development information;

     (c)  notes, products, know how, trade secrets, engineering or other data;

     (d)  specifications, processes, formulae;

     (e)  manufacturing, planning or marketing procedures, techniques or
          information;

     (f)  accounting procedures or financial information; and

     (g)  all terms and conditions of this Agreement (including the Gas Price),
          but excludes:

          (i)  all information that the non-disclosing Party can demonstrate (to
               the reasonable satisfaction of the disclosing Party) that the
               non-disclosing Party knew prior to the disclosure by the
               disclosing Party to the non-disclosing Party;

                                       3
<PAGE>

          (ii)   any information that is in the public domain except information
                 that entered the public domain as a result of a breach of this
                 Agreement;

          (iii)  any information that is required to be disclosed by a stock
                 exchange or a securities regulatory body; and

          (iv)   any information required to be disclosed by a court of law.

     "Contract Year" means the period commencing on the Commencement Date and
     ending on the next 30 June of the first Contract Year and, after that, each
     period of 12 months from 1 July to 30 June, provided that the final
                                                 -------------
     Contract Year will end on the expiration, or earlier termination, of the
     Term.

     "Day" means a period of 24 hours, beginning and ending at midnight,
     Australian Eastern Standard Time.

     "Default" means a Financial Default or a Non-financial Default.

     "Defaulting Party" means the Party which committed the Default.

     "Delivered Gas" means Gas which has been delivered by the Seller to the
     Delivery Point and accepted by the Buyer in accordance with this Agreement.

     "Delivery Point" means the downstream face of the flange where the Gas
     enters into the Buyer's Pipeline, or into a spur pipeline connecting the
     Comet Ridge Project to the Duke Pipeline, at Buyer's election pursuant to
     Clause 9.6.  The Delivery Point into the Buyer's Pipeline shall be
     ----------
     constructed at a location within the boundaries of the Seller's Comet Ridge
     Project which is reasonably acceptable to Buyer and Seller.

     "Duke Pipeline" means the existing Wallumbilla to Gladstone pipeline
     formerly owned and operated by the State of Queensland.

     "Expiry Date" means the date which is 20 calendar years after the
     Commencement Date.

     "FM Notice" has the meaning given in Clause 16.1.
                                          -----------

     "Financial Default" means a Party's failure to satisfy a Financial
     Obligation to the other Party arising under this Agreement.

     "Financial Obligation" means an obligation to pay money under this
     Agreement.

                                       4
<PAGE>

     "Force Majeure Event" means any circumstance, occurrence, event or
     combination of them which is beyond the reasonable control of the Affected
     Party, including (without limitation):

     (a)  any act of God (including but not limited to epidemics, landslides,
          lightning, earthquakes, floods, storms, cyclones, fires, washouts,
          extreme weather conditions), strike, lockout or other labor
          disturbance, acts of public enemies, sabotage, wars, blockades,
          insurrections, riots, or civil disturbances.

     (b)  explosions, breakage of or accident to machinery or lines of pipe
          (including, without limitation, the Pipeline) or equipment,
          obstructions of lines of pipe (including, without limitation, the
          Pipeline) and other means of transportation, or inability to obtain
          materials or equipment;

     (c)  any limitations, curtailment, actions, restraints, restrictions or
          prohibitions imposed on the Buyer by a Government Agency which either
          reduces (i) the volume of the Seller's Gas that the Buyer is allowed
          to transport through the Pipeline in any Month to a volume that would
          be insufficient to transport a proportionate part of the Take or Pay
          Quantity during that Month or (ii) the total quantity of the Products
          that the Buyer is allowed to produce from the Plant in any Month to a
          quantity that is insufficient to permit the Buyer to continue to
          operate the Plant and earn a reasonable return; and

     (d)  any limitation, curtailment, actions, restraints, restrictions, or
          prohibitions imposed on Seller by a Government Agency, or by
          participants in its drilling program, in respect of its drilling
          operations, and gas gathering and compression systems.

     "Gas" means natural gas as defined by the Gas Act, or coal seam methane,
     and meeting the minimum specifications set forth in Annexure 2.
                                                         ----------

     "Gas Price" means the price per GJ of Gas as set out in Clause 11 and in
                                                             ---------
     accordance with the formula set out in Annexure 1.
                                            ----------

     "GJ" means a gigajoule of Gas.

     "Government Agency" means a federal, state or local government, government
     agency, department or ministry, a governmental, semi-governmental and
     judicial person or a person (whether autonomous or not) charged with
     administration of any applicable law or governmental order, regulation or
     rule, which is applicable to either the Seller or the Buyer.

                                       5
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     "Law" means any Commonwealth, state or local government legislation of
     Australia, including regulations, by-laws and subordinate legislation, the
     common law or Authorizations.

     "MDQ" means the maximum daily quantity of Gas to be delivered by the Seller
     to the Buyer up to 42.7 TJ, (which is one hundred fifteen percent (115%) of
     the ADQ)).

     "Month" means the period commencing at midnight Australian Eastern Time on
     the first day of a calendar month and ending at Midnight Australian Eastern
     Standard Time on the first day of the next calendar month.

     "Monthly Schedule" has the meaning given in Clause 5.1.
                                                 ----------

     "Net ACQ" means the ACQ reduced by: (a) the quantities of Gas the Seller
     fails to supply for any reason of Force Majeure, and/or the quantities of
     Gas the Buyer fails to take delivery of due to Force Majeure; and (b) the
     quantities of Undelivered Gas (as defined in Clause 18.1) insofar only as
                                                  -----------
     (i) Seller does not cover pursuant to Clause 18.1 (a) and (ii) Buyer does
                                           ---------------
     not cover pursuant to Clause 18.1 (b).
                           ---------------

     "Nominated Daily Take" means for a Day, the quantity of Gas nominated by
     the Buyer pursuant to Clause 5.1 or, that quantity as varied pursuant to
                           ----------
     Clause 5.2.
     ----------

     "Non-defaulting Party" means with respect to a Default, the Party which is
     not the Defaulting Party.

     "Non-financial Default" means a Party's failure to observe and perform any
     Non-financial Obligation under this Agreement while that obligation is not
     suspended by a Force Majeure Event.

     "Non-financial Obligation" means a material obligation under this Agreement
     that is not a Financial Obligation.

     "PJ" means a petajoule of Gas.

     "Party" means a Party to this Agreement.

     "Pipeline" means: (a) either Buyer's Pipeline, or a spur gas pipeline from
     the Delivery Point to the Duke Pipeline and from the Duke Pipeline to
     Buyer's Plant, as the case may be; and (b) the interconnections to be built
     by Buyer as may be reasonable or necessary to permit the delivery of Gas
     into the Buyer's Pipeline and the Duke Pipeline for transportation of Gas
     to the Plant.

                                       6
<PAGE>

     "Pipeline Pressure" means the pressure of the Gas to be delivered by the
     Seller at the Delivery Point, which shall be not less than 1,225 pounds per
     square inch gauge (8.45 mPa) and not more than 1,300 pounds per square inch
     gauge (8.97 mPa).

     "Plant" has the meaning given in Recital A.
                                      ---------

     "Related Corporation" has the meaning ascribed to it by section 50 of the
     Corporations Act.

     "Seller's Representative" means the person whose name appears in Clause
                                                                      ------
     21.2, being the person nominated by the Seller to receive all notices and
     ----
     other documents relating to this Agreement (or any other replacement as may
     be advised by the Seller to the Buyer from time to time).

     "Solvency Default" means that a Party:

     (a)  applies for, seeks, permits or fails to prevent the appointment of a
          receiver, manager, receiver and manager, administrator or liquidator
          for, or any part of, its property or business and such appointment is
          not revoked within 10 days of its commencement;

     (b)  institutes or joins in proceedings seeking an order for relief or
          determination that it is insolvent or that it be wound up or dissolved
          and such proceedings are not withdrawn within 10 days of being
          instituted or the Party being joined, and any arrangement, adjustment
          or composition of its debts under any law relating to bankruptcy; or

     (c)  has a petition presented or order made for its amalgamation or
          reconstruction, without the other Party's prior written consent, which
          consent will not unreasonably be withheld or delayed, or which
          petition or order is not within 10 days of being made.

     "Take or Pay Quantity" means the quantity determined in accordance with
     Clause 6.1.
     ----------

     "Taxes" means any sales, transaction, property occupation, service,
     production, severance, gathering, transmission, excise, goods and services,
     resource rent or any other taxes, charges, levies, royalties or assessments
     imposed by any governmental or semi-governmental authority, whether local,
     state, or federal payable on the Gas, or on or with respect to the
     production, transmission, delivery, or the sale of the Gas, excluding
     income tax, capital gains tax and all other taxes under the Income Tax
     Assessment Act 1936 (as amended) and the Income Tax Assessment 1997.

     "Term" has the meaning given in Clause 3.1.
                                     ----------

                                       7
<PAGE>

     "TJ" means a terajoule of Gas.

1.2  In this Agreement unless the context otherwise requires:

     (a)  a reference to any legislation or legislative provision includes any
          statutory modification or reinactment of or legislative provision
          substituted for, and any statutory instrument issued under that
          legislation or legislative provision;

     (b)  the singular includes the plural and vice versa;

     (c)  reference to an individual or person includes where the context
          permits, a reference to a corporation, firm, partnership, joint
          venture, association, authority, trust or Government Agency;

     (d)  a reference to any gender includes all genders;

     (e)  any reference to a Party is a reference to a party to this Agreement
          and includes a reference to that Party's executors, administrators,
          substitutes, successors and permitted assigns;

     (f)  a reference to dollars of "$" is to an amount in Australian currency;

     (g)  headings to clauses are inserted for convenience only and are not
          intended to be part of or to affect the meaning or interpretation or
          any of the terms and conditions in this Agreement;

     (h)  every agreement or undertaking expressed or implied by which more than
          one person agrees or undertakes any obligation or derives any benefit
          binds or inures for the benefit of those persons jointly and each of
          them severally.

2.0  SALE AND PURCHASE

2.1  The obligations of the Parties under the Agreement, other than their
     obligations under Clauses 17, 20  and 24, are subject to and do not become
                       ----------------------
     binding unless:

     (a)  Buyer: (i) establishes and maintains its creditworthiness to the
          reasonable satisfaction of the Seller, and (ii) the Buyer has in place
          the necessary financing commitments, under terms reasonably acceptable
          to Buyer and Seller, that will foreseeably allow Buyer to construct
          and commission the Plant and the Pipeline between September 1, 2002
          and the Commencement Date. If these conditions precedent are not
          satisfied by 31 May 2002, then this Agreement will terminate (except
          for Clauses 17, 20
              --------------

                                      8
<PAGE>

          and 24 and the enforcement of any right or claim which arises
          ------
          thereunder), unless the Seller agrees in writing to extend the time
          required to meet these conditions.

     (b)  Seller has in place the necessary financing commitments, under terms
          reasonably acceptable to Buyer and Seller, that will foreseeably allow
          Seller to drill and complete the number of wells, to install laterals
          and compressors, as Seller reasonably deems necessary between
          September 1, 2002 and the Commencement Date to deliver the ACQ to the
          Delivery Point and meet Pipeline Pressure requirements.  If these
          conditions precedent are not satisfied by 31 May 2002, then this
          Agreement will terminate (except for Clauses 17, 20 and 24 and the
                                               ---------------------
          enforcement of any right of claim which arises thereunder), unless
          Buyer agrees in writing to extend the time required to meet this
          condition.

2.2  In addition to the conditions in Clause 2.1, Buyer shall begin actual
                                      ----------
     construction of the Plant by 1 September, 2002, and diligently prosecute
     actual construction of the Plant and the Pipeline thereafter in an orderly
     and prudent manner through and until the Commencement Date.

     (a)  From the date of signing of the Agreement, each Party shall use
          reasonable commercial endeavours to: (i) cooperate with, and deliver
          data, information, plans, surveys and other materials as may be
          reasonably requested by, the other Party to facilitate the design and
          interconnection of the Delivery Point and Pipeline to be constructed
          and commissioned by the Buyer, and the gathering system to be
          constructed and commissioned by or on behalf of the Seller within the
          Comet Ridge Project, as contemplated by this Agreement; (ii) deliver
          information regarding the status of its financial condition requested
          by the other Party, to the extent that it determines the other Party's
          request is reasonably required to satisfy conditions under the other
          Party's financing commitment; (iii) deliver copies of Seller's most
          recent reserve studies as described in Clause 10.6; (iv) perform such
                                                 ----------
          additional and other acts as may be reasonably requested by the other
          Party to permit both Parties to complete the construction,
          commissioning, and interconnection of their respective facilities,
          fixtures and equipment, (v) periodically report to the other Party
          regarding progress to the satisfaction of the conditions applicable to
          it; and (vi) use commercially reasonable endeavours to satisfy the
          conditions precedent applicable to it; provided that neither Party
                                                 -------------
          shall be obligated to (a) assume, guarantee, or pay any amount
          applicable to the facilities, fixtures and equipment to be constructed
          and commissioned by the other Party, (b) incur expenses to audit,
          obtain or prepare financial information or reserve studies, or respond
          to any audit requests, inquiries or other procedures, that it deems
          unreasonable in the exercise of its sole business discretion, (c)
          obtain any exception, license, order, permit, variance from a
          Government Agency or from a third person for the facilities, fixtures
          and

                                       9
<PAGE>

          equipment to be constructed and commissioned by the other Party, or
          (d) perform any act or satisfy any condition allocated to the other
          Party.

     (b)  Notwithstanding any provision of this Agreement to the contrary, the
          Seller shall have the absolute and unconditional right to terminate
          this Agreement if, for any reason (excluding Force Majuere): (i)
          actual construction of the Plant and the Buyer's Pipeline is
          interrupted, suspended or terminated for a period of ninety (90)
          continuous Days; or (ii) the Buyer does not begin to take and pay for
          (or pay for without taking) Gas under this Agreement by the
          Commencement Date.

2.3  The Seller agrees to sell and deliver to Buyer at the Delivery Point, and
     the Buyer agrees to take and purchase from Seller at the Delivery Point (or
     pay for without taking), quantities of Gas:  (a) subject to the conditions
     precedent in Clauses 2.1 and 2.2; and (b) in accordance with the terms and
                  -------------------
     conditions of this Agreement.

2.4  The Buyer must deliver written notice to the Seller not less that forty-
     five (45) Business Days' before the Day on which the Buyer intends to take
     the first delivery of Gas from the Seller under this Agreement; provided
                                                                     --------
     that Seller shall have no obligation to supply Gas to Buyer before 1 April
     ----
     2004.

3.0  TERM

3.1  All of the obligations of the Parties to this Agreement will be binding on
     the Parties from the date the conditions precedent in Clauses 2.1 and 2.2
                                                           -------------------
     are satisfied. The obligation to deliver, and to receive and pay for (or
     pay for without taking), Gas will be for the period commencing on the
     Commencement Date and expiring on the Expiry Date unless earlier terminated
     in accordance with Clauses 2.1, 2.2, 16.9 and 19 ("Term"), subject to
                        -----------------------------
     extension under Clause 4.0 and Buyer's Make-Up Rights under Clause 7.2.
                     ----------                                  ----------

4.0  AGREEMENT TO NEGOTIATE

4.1  If the Seller or the Buyer:

     (a)  wishes to extend the Term of this Agreement; and

     (b)  gives the other Party notice in writing to that effect not less than
          six (6)  Months prior to the Expiry Date, then the Parties will meet,
          negotiate in good faith and attempt to reach agreement to extend the
          Term.

                                      10
<PAGE>

5.0  NOMINATION AND SUPPLY

5.1  Not later than 10:00 a.m. on the Day that is ten (10) Business Days before:

     (a)  the Commencement Date, and the commencement of each Month (or part of
          it) thereafter during the Term;

     (b)  the Buyer's Representative must forward (by facsimile transmission) to
          the Seller's Representative a schedule in a form reasonably acceptable
          to Seller ("Monthly Schedule"), which shall contain  of the Buyer's
          best estimate of (i) the Days of the relevant Month that the Plant
          will be open, and conducting operations that will require supplies of
          Gas, and (ii) the daily quantities of Gas ("Nominated Daily Take")
          which the Buyer proposes to accept from the Seller on each Day of that
          Month ("Nominated Day"); and

     (c)  notwithstanding any other provision of this Agreement to the contrary,
          the Seller shall not be obligated to deliver, or pay for costs and
          expenses reasonably incurred by Buyer to obtain, alternate Gas
          supplies under Clause 18 for a Nominated Daily Take that exceeds 80%
                         ---------
          of the ADQ (or 60% of the ADQ during the first two Contract Years) for
          each Nominated Day during any Month that the Buyer fails to deliver a
          Monthly Schedule on or before the date prescribed above for any
          reason.

     The Buyer shall use its best endeavours for each Monthly Schedule to
     provide for the supply and purchase of a consistent quantity of Gas each
     Day the Plant is open and conducting operations during the applicable
     Month, which should normally be equivalent to the ADQ on average over the
     course of that Month.  If the Seller anticipates that it may be unable to
     supply all or any part of the Nominated Daily Take for any Nominated Day
     due to scheduled maintenance, repair or replacement of the facilities,
     fixtures and equipment to be constructed and commissioned by Seller, the
     Seller's Representative will notify the Buyer's Representative within five
     (5) Business Days after Seller's receipt of the Monthly Schedule of the
     anticipated time delivery of Gas will be restricted.  Thereafter, the
     Buyer's Representative and the Seller's Representative shall cooperate with
     each other, and negotiate diligently and in good faith, to adjust the
     Nominated Daily Takes and to arrange for the Seller's delivery of Gas from
     alternate sources as contemplated in Clause 18 to avoid disruption to the
                                          ---------
     operation of the Plant and to permit the completion of the scheduled
     maintenance, repair or replacement of the facilities, fixtures and
     equipment constructed and commissioned by Seller.

5.2  If the Buyer's Representative anticipates that it will request the Seller
     to increase the Nominated Daily Take for any Nominated Day, the Buyer's
     Representative may give notice (by facsimile transmission) to the Seller's
     Representative requesting the Seller to increase the quantity of Gas to be
     supplied during the Nominated Day from the Nominated Daily Take up to an
     amount equal to the

                                      11
<PAGE>

     MDQ no later than seventy-two (72) hours before 10:00 a.m. on the Nominated
     Day. The Seller will use all commercially reasonable endeavours to increase
     the quantity of Gas produced from its property, and to supply the
     additional Gas on that Nominated Day; provided that, the Seller shall not
                                           -------------
     (a) have any obligation to (i) apply to any Government Agency for an
     exception, license, order, permit, variance or other action, (ii) incur any
     cost, expense or fee to supply the additional quantities of Gas which would
     be proportionately higher than the costs, expenses or fees attributable to
     the Nominated Daily Take, (iii) install additional facilities, fixtures or
     equipment, or modify existing facilities, fixtures or equipment, upstream
     from the Delivery Point, or (iv) purchase Gas from another producer or
     supplier for resale to the Buyer under this Agreement or (b) incur any
     liability to Buyer under this Contract if it fails to supply the additional
     quantity of Gas.

5.3  Subject to Clauses 15 and 16:
                -----------------

     (a)  the Seller must deliver to the Buyer; and

     (b)  the Buyer must accept from the Seller,

     Gas at the Delivery Point in accordance with the Nominated Daily Take.

5.4  The Buyer may request the Seller to supply quantities of Gas during a Day
     which exceed the MDQ, or during a Contract Year which exceed the ACQ.  In
     this event, the Buyer's Representative shall deliver notice to the Seller's
     Representative at least ten (10) Business Days before the Day the Buyer
     wishes the Seller to supply a quantity of Gas that exceeds the MDQ or three
     (3) Months before the Day Buyer wishes the Seller to supply a quantity of
     Gas that exceeds the ACQ, as may be applicable, which notice shall state
     (a) the total quantity of Gas that the Buyer is requesting the Seller to
     supply for the applicable period of time covered by the Buyer's notice and
     (b) the portion of that total quantity that exceeds the MDQ or ACQ, as
     applicable. Notwithstanding anything in this Agreement to the contrary: (i)
     the Buyer agrees that (x) the Seller will be under no obligation to supply
     any quantity of Gas in excess of the MDQ on any Day during the Term, or
     more than the ACQ in any Contract Year, and (y) the delivery and sale of
     more than the MDQ in any Day, or the ACQ in any Contract Year, will be at
     the Seller's sole discretion; and (ii) the Seller agrees that any quantity
     of Gas that it agrees to deliver and sell to Buyer pursuant to this Clause
                                                                         ------
     5.4 shall be in addition to (and shall not reduce) the MDQ or the ACQ, as
     ---
     may be applicable.

6.0  TAKE OR PAY QUANTITY

6.1  During each Contract Year of the Term, Buyer will take and pay for (or be
     required to pay for without taking) 80% of the Net ACQ save for the first
     and second Contract Years of the Term when the Buyer will take and pay for
     (or be required to pay for without taking), 60% of the Net ACQ ("Take or
     Pay Quantity").  The Seller shall calculate Annual Makeup, Net ACQ and the
     Take or

                                 12
<PAGE>

     Pay Quantity in accordance with Clause 6.2.  The Seller shall include  all
                                     ----------
     Gas the Seller caused to be delivered pursuant to Clause 18.1(a), and all
                                                       --------------
     Gas the Buyer obtained pursuant to Clause 18.1 (b), in the quantity of Gas
                                        ---------------
     taken and paid for by the Buyer as is relevant to each of those
     calculations.

6.2  The Seller will deliver a notice to Buyer setting forth the calculation of
     the Annual Makeup, Net ACQ and the Take or Pay Quantity for each Contract
     Year on or before August 15 of the following Contract Year.  The Seller
     shall calculate each of these amounts for each Contract Year based upon the
     reconciliation notices for each Month of the applicable Contract Year
     delivered by Seller to Buyer pursuant to Clause 10.3; provided that if the
                                              -----------  -------------
     first Contract Year is less than twelve (12) months, the Annual Makeup, the
     Net ACQ and the Take or Pay Quantity shall be prorated accordingly.  The
     Buyer shall review the Seller's calculations, and deliver written notice to
     the Seller of any specific exceptions thereto (with sufficient detail for
     Seller to investigate and respond to each exception), within fifteen (15)
     Business Days after the Day the Buyer receives the Seller's calculations.
     Buyer agrees that each exception must be made on a bona fide basis, and not
     solely with a view to obstructing the Annual Makeup Payment.  If the Buyer
     makes any exceptions:

     (a)  The Seller and the Buyer shall cooperate with each other, and
          negotiate diligently and in good faith, to resolve the Buyer's
          exceptions as follows:  (i) exceptions relating to the inadvertent
          omission of data contained in reconciliation notices approved in
          accordance with Clause 10.3, simple mathematical errors of addition or
                          ------------
          other functions, transposition of numbers and similar matters shall,
          to the maximum extent practicable, be resolved by telephone
          conference, and the exchange of data within five (5)  Business Days of
          the Seller's receipt of the Buyer's exceptions, by facsimile or other
          convenient methods; (ii) exceptions relating to the reconciliation
          notice for June of the prior Contract Year, any exceptions to any
          other reconciliation notices which remain unresolved on the date
          Seller makes its calculations under this Clause 6.2 and any other
                                                   ----------
          exceptions, shall, to the maximum extent practicable, be resolved by a
          meeting between Seller and Buyer held at Seller's offices in Brisbane,
          Australia  at the conclusion of that five (5) Business Days period;
          and (iii) thereafter, any remaining exceptions may be referred by
          either Party to arbitration pursuant to the dispute resolution
          procedure under Clause 22.  To the extent applicable, the periods
                          ---------
          specified in this Clause and in Clause 10.3 shall run concurrently.
                                          -----------

     (b)  The Buyer shall pay the Annual Makeup Payment to Seller within twenty-
          one (21) Days after receipt of the Seller's calculation notice
          referred to in Clause 6.2, provided that (i) Buyer may elect to defer
                         ----------  -------------
          the portion of any Annual Makeup Payment that is subject to an
          exception which has not been resolved by the date the Annual Makeup
          Payment is due, and (ii) the Buyer shall, in that event, pay (aa) the
          full amount of the undisputed

                                       13
<PAGE>

          portion of the Annual Makeup Payment when due and (bb) interest on the
          deferred portion of the Annual Makeup Payment that is ultimately
          determined to be owed by Buyer to Seller at the BB Rate plus two
          percent (2%), which shall accrue from the date the Annual Makeup
          Payment was due until the date the Seller actually receives payment.

     (c)  The Buyer shall make each Annual Makeup Payment in accordance with the
          procedure in Clause 12.3.
                       -----------

6.3  The Buyer acknowledges that the Annual Makeup Payment is intended, and
     shall be construed, as consideration given by Buyer for Seller's agreements
     to obtain and reserve sufficient quantities of Gas to sell and supply the
     ACQ, the ADQ and the MDQ to Buyer as contemplated by this Agreement. If any
     person should allege that any of the terms and provisions of this Agreement
     relating to the Annual Makeup Payment are ambiguous, incomplete, vague or
     otherwise unenforceable, the Parties intend those provisions should be: (a)
     liberally construed in favor of the Seller; and (b) supplemented by such
     commercially reasonable terms as may be necessary to enforce those
     provisions and effectuate the Buyer's intention to give consideration for
     the Seller's agreements as set forth above. Notwithstanding anything in
     this Agreement to the contrary, the Annual Makeup Payment is not intended
     by the Parties to constitute, and shall not be construed as, consideration
     given by Buyer to Seller for the sale of Gas or as a penalty.

7.0  ANNUAL MAKE UP

7.1  If Buyer pays an Annual Makeup Payment to Seller in respect of a Contract
     Year, the Buyer will have the right to receive a quantity of Gas up to the
     Annual Makeup Quantity for that Contract Year at no additional cost during
     the immediately succeeding three (3) Contract Years of the Agreement
     provided that:
     -------------

     (a)  the Buyer is required to take delivery of 60% of the Net ACQ in the
          first two (2) Contract Years, and 80% of the Net ACQ in each
          subsequent Contract Year, before it may recover any part of the
          Accumulated Annual Makeup; and

     (b)  at the end of the three (3) immediately succeeding Contract Years, the
          remaining unused Annual Makeup Quantity for the first Contract Year of
          the three (3) Contract Year period shall automatically expire, without
          any further adjustment, balancing, offset, refund or right accruing to
          the Buyer with respect thereto.

                                       14
<PAGE>

7.2  If there is Accumulated Annual Makeup at the end of the Term, the Buyer may
     request delivery of that Gas in accordance with Clause 5.  The Buyer's
                                                     --------
     right to have Accumulated Annual Makeup Gas delivered will extend for a
     period of up to one (1) year from the expiry or termination of this
     Agreement.

7.3  The Seller's obligation to deliver all or any part of the Annual Makeup
     Quantity, or the Accumulated Annual Makeup quantity, will be subject to
     Clause 5.4 and to operational constraints existing at the time the Buyer
     ----------
     nominates any quantity of Gas above the MDQ.

8.0  SELLER'S OPTION TO SUPPLY

8.1  If the Buyer plans any additions, enhancements or expansions to the Plant
     ("Expansion") which will increase the MDQ and ACQ required to operate the
     Plant each Day during the Term ("Additional Gas"), the Buyer shall provide
     notice to the Seller as soon as possible (but in any event at least ten
     (10) months before the date the Buyer will require the initial delivery of
     the Additional Gas), which shall state the maximum total quantities of Gas
     Buyer anticipates it will require each Day and Contract Year (as may be
     applicable) as a result of the Expansion, the then current MDQ and ACQ
     under this Agreement and any other material terms and conditions which may
     be applicable to the Additional Gas.  The Seller may (but shall not be
     obligated to) submit an offer to sell all or any part of the Additional Gas
     to Buyer within fifteen (15) Days following receipt of Buyer's notice. (a)
     Buyer may elect to accept Seller's offer (if any) within fifteen (15) Days
     following receipt, in which case Buyer and Seller shall prepare applicable
     documents to govern the sale and purchase of the Additional Gas; or (b) the
     Buyer may reject the Seller's offer and obtain one or more offers from
     third party Gas suppliers for the sale and purchase of additional Gas
     stating the price and other material terms of sale quoted to the Buyer
     ("Gas Market Offer"), provided that (i) any Gas Market Offer must reflect
                           -------------
     an arm's length proposal by an established unaffiliated third party Gas
     supplier to sell the Additional Gas to Buyer, negotiated in good faith, and
     (ii) Buyer must deliver a copy of any contract, letter of intent, quotation
     or other document representing the Gas Market Offer that Buyer intends to
     accept to Seller at least nine (9) months before the date the Buyer will
     require the initial delivery of the Additional Gas.  The Seller will have a
     right of first refusal to agree to sell all or any part of the Additional
     Gas required by Buyer at the price quoted in that Gas Market Offer as
     provided in Clause 8.2.
                 ----------

     Seller's right of first refusal shall also apply to:  (i) the extension,
     renewal or replacement of any Gas sale arrangement completed by Buyer and a
     third party Gas supplier if Seller failed or refused to exercise its right
     of first refusal in response to the Buyer's prior solicitation of a Gas
     Market Offer; and (ii) to each addition, enhancement or expansion the Buyer
     may make to the Plant which

                                       15
<PAGE>

     increases the total quantity of Gas the Buyer will require to operate the
     Plant during a Day.

8.2  If the Seller exercises its right of first refusal pursuant to Clause 8.1,
                                                                    ----------
     Seller shall deliver notice to Buyer within thirty (30) Days after Seller's
     receipt of the Gas Market Offer Buyer intends to accept.  Further, the
     Seller and the Buyer shall cooperate with each other to prepare, execute
     and deliver a separate Gas Sales Agreement, and any other documents as the
     Seller and Buyer may deem reasonable or necessary, to record the terms and
     provisions which may be applicable to the sale and purchase of the
     Additional Gas.  Notwithstanding any Gas Market Offer, or any separate Gas
     Sales Agreement which Seller and Buyer may deliver pursuant to any Gas
     Market Offer, this Agreement shall continue in full force and effect
     without amendment or modification except as may be necessary to increase
     the ADQ and MDQ (if applicable) to be sold by Seller, and purchased by
     Buyer, under this Agreement to a pro rata part of the ACQ.

8.3  Any additional quantities of Gas purchased from Seller under this Clause 8
                                                                       --------
     in a Contract Year shall be included in the amount of Gas taken by Buyer
     under this Agreement up to the ACQ for purposes of calculating the Take or
     Pay Quantity.

9.0  DELIVERY, TITLE AND RISK

9.1  The Seller will deliver Gas purchased by the Buyer to the Delivery Point at
     the Pipeline Pressure at its sole cost.

9.2  Risk and title in the Gas will pass to the Buyer at the Delivery Point.

9.3  The Seller and the Buyer shall respectively operate (or use their best
     endeavours to cause third parties to operate) their respective facilities,
     fixtures and equipment at their sole cost and expense, and as reasonable
     and prudent operators utilizing ordinary care and skills and in accordance
     with the standards of the gas pipeline industry, to conduct operations to
     deliver and transport the Gas to be sold and purchased under this
     Agreement.  Without limiting the generality of the foregoing:

     (a)  the Seller shall be responsible for operating and maintaining
          compressors, gathering lines, the Measurement Meter (defined in Clause
                                                                          ------
          10.1 below) and the other surface equipment upstream of the Delivery
          ----
          Point; and

     (b)  the Buyer shall be responsible for operating and maintaining the
          Delivery Point, the Pipeline and other surface equipment downstream of
          the Delivery Point;

                                       16
<PAGE>

      provided that, if Buyer alters the Pipeline Pressure, the Buyer shall
      -------------
      compensate Seller for the cost of any additions, enhancements, expansions
      or other modifications to the surface equipment Seller is responsible for
      operating as may reasonable or necessary for the Seller to deliver Gas at
      the altered pressure.

9.4   The Seller shall deliver Gas into the Pipeline at a rate of flow each Day
      which the Seller's Representative and the Buyer's Representative may
      mutually agree; provided that the rate of flow must be (a) consistent with
                      -------------
      design capacities and operating capabilities of the facilities, fixtures
      and equipment the Seller and the Buyer are respectively responsible for
      and (b) equal to or exceed the minimum rate of flow that can be accurately
      measured by the Measurement Meter.

9.5   The Buyer shall construct the Buyer's Pipeline along a route of its
      selection; provided that (a) the route for any portion of the Pipeline
                 -------------
      constructed within the Comet Ridge Project shall be reasonably acceptable
     to Buyer and Seller and (b) the Buyer and Seller shall use reasonable
     endeavours to coordinate, and support the other Party's application to
     Government Agencies and third persons for, easements, licenses, permits and
     other actions in respect of lands within the Comet Ridge Project. The
     Delivery Point, and the Buyer's Pipeline constructed by or on behalf of
     Buyer in respect of this Agreement shall conform to all applicable Laws,
     and to the minimum construction specifications and standards of the gas
     pipeline industry, with due regard for the anticipated operational life of
     the Delivery Point and all portions of the Pipeline in respect of this
     Agreement.

9.6   The Parties acknowledge and agree that:

      (a)  The Buyer is entitled, at its election, to have Gas transported for
           the purposes of this Agreement by either Buyer's Pipeline or the Duke
           Pipeline, unless one is closed due to Force Majuere or other reasons.
           The Monthly Schedule shall specify the Delivery Point for Gas
           nominated each Day by Buyer.

      (b)  The Buyer will do everything to ensure (i) the Pipeline is available
           for the receipt of Gas from Seller at the Delivery Point and (ii) the
           Buyer has adequate rights for the transportation of Gas from the
           Delivery Point to the Plant.

      Without limiting Clause 9.2, as between Seller and Buyer, Buyer shall bear
                      ----------
      all costs, expenses and risks arising from, or directly or indirectly
      related to, the transportation of Gas after the Delivery Point.

                                       17
<PAGE>

10.0  QUANTITIES OF GAS

10.1  Seller will cause the installation of gas metering equipment at the
      Delivery Point to determine the quantity, quality and heating value of Gas
      supplied by Seller to Buyer pursuant to this Agreement ("Measurement
      Meter"). The Measurement Meter must:

      (a)  be approved by the Buyer, which approval must not be unreasonably be
           withheld; and
      (b)  be of suitable capacity and conform with the minimum specifications
           and standards of the gas pipeline industry.

10.2  Buyer may install check gas metering equipment at the Delivery Point to
      measure the quantity, quality and heating value of Gas at its own cost,
      which shall remain the property of Buyer.

10.3  The Buyer acknowledges that at the end of each Month of the Term, the
      Seller will issue to the Buyer a reconciliation notice setting out the
      daily quantities of Gas Seller supplies to the Buyer at the Delivery
      Point.

      (a)  Each reconciliation statement shall include the following
           calculations, data and information for the Month covered thereby: (i)
           the Nominated Daily Takes, and any increases thereto for a Nominated
           Day received by Seller pursuant to Clause 5.2; (ii) the quantity of
                                              ----------
           Delivered Gas for each Nominated Day, as measured by the Measurement
           Meter; (iii) any adjustments to the quantity of Delivered Gas for any
           Nominated Day resulting from a notice delivered by Buyer pursuant to
           Clause 10.5 or Clause 12.4; or (iv) an FM Notice given or received by
           -----------    -----------
           the Seller which (aa) relates to a circumstance or condition that
           prevented the Seller from supplying, or the Buyer from accepting, the
           Nominated Daily Take, and any increases thereto for a Nominated Day
           received by Seller pursuant to Clause 5.2 and (bb) is relevant to the
                                          ----------
           calculation of Net ACQ and the Take or Pay Quantity.

     (b)   The Buyer shall review, and deliver specific exceptions to the Seller
           in respect of the calculations, data and information contained in,
           each reconciliation statement as set forth below.

           (i)  Buyer may deliver a notice to Seller within fifteen (15)
                Business Days of receipt of each reconciliation notice
                containing specific exceptions: (a) relating to (1) clerical
                errors including, without limitation, the inadvertent omission
                of data, simple mathematical errors of addition or other
                functions, transposition of numbers or similar matters; and (2)
                other specific exceptions on a bona fide basis, and not solely
                with a view to obstructing the payment or performance of any of
                Buyer's obligations under this Agreement;

                                       18
<PAGE>

                and (b) stating, for each exception (1) the relevant charge,
                entry or other item covered by the exception, (2) the basis of
                the exception and (3) the adjustment, modification or revision
                that Buyer suggests to resolve the exception.

          (ii)  The Seller and Buyer shall cooperate with each other, and
                negotiate diligently and in good faith, to resolve each of the
                Buyer's exceptions to a reconciliation notice: (a) first, by
                telephone conferences and the exchange of data, within five (5)
                Business Days of the Seller's receipt of the Buyer's exceptions;
                (b) second, by a meeting at Seller's office in Brisbane,
                Australia at the conclusion of the proceeding five (5) Business
                Day period, to attempt to resolve any exceptions that remain
                unresolved after the telephone conferences and exchange of data;
                and (c) finally, by arbitration initiated at the request of
                either Party pursuant to Clause 22, for any unresolved
                                         ---------
                exceptions.

          If Buyer has delivered a notice pursuant to Clause 10.5 or Clause
                                                      -----------    ------
          12.4, and the curative action under the relevant clause is pending,
          ----
          the Buyer's notices under those clauses shall also constitute an
          objection to the relevant reconciliation notice and the Seller shall
          adjust that notice to the extent that adjustments are subsequently
          made the quantity of Delivered Gas pursuant to Clauses 10.5 or 12.4.
                                                         --------------------

     (c)  If the Buyer does not deliver specific exceptions to a reconciliation
          notice, and curative actions under Clause 10.5 or Clause 12.4 are not
                                             -----------    -----------
          pending, the Buyer shall be deemed to have accepted the reconciliation
          statement upon the expiration of the fifteen (15) Business Day period
          specified in Subclause 10.3(b) (ii).  Alternatively, the Seller shall
                       ----------------------
          revise an affected reconciliation notice to adjust the calculations,
          data and information based upon the resolution of exceptions and other
          matters by Seller and Buyer pursuant to Clauses 10.3, 10.5 and 12.4,
                                                  ---------------------------
          as applicable.  Thereafter, the Seller shall use the reconciliation
          notices without any further adjustment, modification or revision to
          calculate Net ACQ, the Take or Pay Quantity and Annual Makeup pursuant
          to Clause 6.2.
             ----------

10.4  The Seller and Buyer agree that, on every Day of the Term: (a) the Seller
      shall obtain and maintain sufficient Gas reserves or gas supply
      arrangements and sufficient equipment, as may be necessary to deliver
      quantities of Gas up to the MDQ and ACQ to Buyer (including, without
      limitation, as contemplated under Clause 18.1); (b) the Buyer shall
                                        ----------
      reserve sufficient capacity, and allocate sufficient facilities, fixtures
      and equipment, as may be reasonable or necessary for the Buyer to receive
      the Gas delivered by the Seller to the Buyer at the Delivery Point
      pursuant to this Agreement and to transport that Gas from the Delivery
      Point to the Buyer's Plant at the Buyer's cost or arrange for the delivery
      of Gas

                                       19
<PAGE>

      from a source other than the Seller; and (c) the Seller's Gas will be
      deemed to the first Gas through the Delivery Point.

10.5  If the Buyer believes there is a discrepancy above one and one-half
      percent (1.5%) between the Seller's metered quantity and the Buyer's
      metered quantity of the Delivered Gas for any Day, the Buyer may deliver a
      notice to Seller disputing the accuracy of the Seller's Measurement Meter
      and requesting the Seller to carry out such inspections and tests as may
      be relevant to determine the accuracy of the Measurement Meter. Seller
      will provide Buyer with at least seventy-two (72) hours notice of the date
      and time any inspection or test will be performed on the Measurement Meter
      and Buyer will have the right to have a representative present, if Buyer
      so desires.

      (a)  If the inspections and tests carried out under Clause 10.5 discover
                                                          -----------
           and document discrepancies equal to or less than one and one-half
           percent (1.5%) of the quantity of Delivered Gas as measured by the
           Measurement Meter, then the Buyer will pay all expenses of the Seller
           incidental to the inspections and tests.

     (b)   If the inspections and tests carried out under Clause 10.5 discover
                                                          -----------
           and document discrepancies in excess if one and one-half percent
           (1.5%) of the quantity of Delivered Gas as measured by the
           Measurement Meter, then:

           (i)   the Seller will promptly carry out all necessary repairs, work
                 and recalibrations to remedy the faults in the Measurement
                 Meter;

           (ii)  the cost of the inspections and tests will be borne by Seller;
                 and

          (iii)  the Seller will issue a correction to the relevant invoices and
                 reconciliation notices delivered to the Buyer with respect to
                 the quantities of Delivered Gas for the relevant period,
                 beginning with the earlier of (x) the Day that Seller receives
                 Buyer's notice pursuant to Clause 10.5 and continuing through
                                            -----------
                 the Day that Seller remedies the faults in the Measurement
                 Meter or (y) a Day (not to exceed thirty (30) Days before the
                 Day that Seller receives Buyer's notice pursuant to Clause
                                                                     ------
                 10.5) that Buyer is able to prove, by a preponderance of the
                 ----
                 evidence, that the discrepancy began and continued without
                 interruption through the Day that Seller remedies the faults in
                 the Measurement Meter; and

           (iv)  Buyer may elect to obtain either (aa) credit for the amount of
                 any overpayment against any future Gas purchases by Buyer under
                 this Agreement, or (bb) a refund the amount of the overpayment
                 from Seller.

                                       20
<PAGE>

10.6  The Seller agrees to provide Buyer a copy of the most recent gas reserve
      study lodged by the Seller's parent company with the U.S. Securities and
      Exchange Commission upon Buyer's request from time to time, but not more
      frequently than once each Contract Year.

10.7  Notwithstanding anything to the contrary in this Agreement (or in any
      other document delivered by Seller and Buyer relating to the transactions
      contemplated herein), Buyer shall have no power, privilege or right to
      audit or inspect (and Seller shall have no duty, liability or obligation
      to disclose or make available) any other data, document or information
      relating (directly or indirectly) to the reserves, supply arrangements or
      business affairs of Seller, or its affiliates.

11.0  CHARGES

11.l  Except for Gas supplied under Clause 8, the charge for Delivered Gas sold
                                    --------
      and supplied by the Seller to the Buyer pursuant to this Agreement up to
      the MDQ is the Gas Price multiplied by the relevant quantity of Delivered
      Gas (in GJs). The formula for determining the applicable Gas Price is set
      out in Annexure 1.
             ----------

11.2  Except for Gas supplied under Clause 8, the charge for Delivered Gas above
                                    --------
      the MDQ will be the price per GJ for such excess Gas quoted to the Buyer
      by the Seller multiplied by those quantities.

11.3  The charge for Delivered Gas under Clause 8 shall be the price set forth
                                         --------
      in the applicable Gas Market Offer to which Seller's right of first
      refusal relates.

11.4  The Parties acknowledge that the Gas Price includes and the Seller is
      liable for any royalties, overriding royalties and other payments in or
      measured by production and Taxes applying on the Commencement Date in
      respect of the production, processing or transportation of Gas to the
      Delivery Point; provided that the Gas Price shall be increased by the
                      -------------
      amount of Goods and Services Tax as may be applicable to all payments due
      by Buyer to Seller hereunder.

11.5  In addition to paying the Gas Price, the Buyer will be solely liable for
      and must reimburse the Seller (or, where applicable, pay on the Seller's
      behalf) for any of the following:

      (a) any new Taxes incurred or levied on Gas the subject of this Agreement,
          or its purchase at or after the delivery point, imposed after the date
          of this Agreement;

      (b) any Taxes applicable in connection with the use of Gas or the
          transportation of Gas from the Delivery Point; and

                                       21
<PAGE>

      (c) any increases in Taxes that applied on the date of this Agreement
          incurred or levied on Gas the subject of this Agreement, or its
          purchase at or after the delivery point, imposed after the date of
          this Agreement.

      provided that Seller shall credit Buyer with the amount of any Tax or
      -------------
      amount charged to Buyer in Clause 11.5 in the event such Tax or amount is
                                 -----------
      reduced.

11.6  GST

      (a) The following definitions apply to this Clause 11.6:

          "GST" has the same meaning as in the GST Act;

          "GST Act" means A New Tax System (Goods and Services Tax) Act 1999 as
          amended;

          "Registered" has the same meaning as in the GST Act;

          "Supply" has the same meaning as in the GST Act;

          "Taxable Supply" has the same meaning as in the GST Act;

          "Tax Invoice" has the same meaning as in the GST Act; and

          "Value" has the same meaning as in the GST Act.

      (b) The Parties agree that the Gas Price is exclusive of GST.

      (c) If any Supply made by the Seller to the Buyer under this Agreement is
          a Taxable Supply then in addition to the Gas Price payable by the
          Buyer to the Seller under this Agreement, the Seller shall be entitled
          to recover from the Buyer an additional amount on account of GST, such
          amount to be equal to the amount of the Seller's GST liability in
          respect of that Supply calculated in accordance with the GST Act on
          the basis that the Gas Price multiplied by the Gas supplied is the
          Value of the Taxable Supply.  The GST amount will be recoverable at
          the same time as the Gas Price is payable under this Agreement.

      (d) The Seller must provide a Tax Invoice to the Buyer on the due date for
          payment of the Gas supplied under this Agreement.

                                       22
<PAGE>

12.0 INVOICES AND PAYMENT

12.1 Commencing with the second Month of Gas deliveries, by the fifteenth
     (15/th/) Day of each Month, the Seller shall deliver to the Buyer by way of
     facsimile transmission an invoice for the Gas delivered during the
     immediately preceding Month.

12.2 The Buyer must pay the amount specified in the Seller's invoice issued
     pursuant to Clause 12.1 within 15 Days after the date the Buyer received a
                 -----------
     facsimile copy of the invoice rendered under Clause 12.1, except to the
                                                  -----------
     extent the invoice is manifestly incorrect on its face or the Buyer is
     entitled to defer or offset payment pursuant to Clauses 10 or 12.
                                                     ----------------

12.3 All payments required to be made by the Buyer to the Seller pursuant to
     this Clause 12: (a) are due and payable in Brisbane, Australia; and (b)
          ---------
     must be made by telegraphic transfer direct into the Seller's bank account,
     in accordance with payment instructions delivered by the Seller to the
     Buyer from time to time.

12.4 If any item or part of an item shown on an invoice rendered by the Seller
     to the Buyer is disputed or subject to question by the Buyer on a bona fide
     basis and not solely with a view to obstructing payment of amounts which
     are due and payable, then the Buyer must pay by the due date the amount not
     in dispute and provide a detailed statement of its objection to the
     disputed amount.

12.5 The Parties will discuss the dispute in good faith but if the matter is not
     resolved within two weeks of the due date, it may be referred by either
     Party to arbitration pursuant to the dispute resolution procedure under
     Clause 22.
     ---------

12.6 After settlement of the dispute, any amount agreed or determined to be paid
     must be paid within seven (7) Business Days of the settlement by the Buyer
     to the Seller together with interest at the BB Rate plus two percent (2%)
     from (and including) the date when the disputed amount fell due to (but
     excluding) the date of payment.

12.7 If a law requires a Party to withhold or deduct any Tax from a payment so
     that the Party to whom the payment is to be made would not actually receive
     for its own benefit on the due date the full amount provided for under this
     Agreement, then the Party making the relevant payment will: (a) make the
     deduction and pay the full amount deducted to the relevant Government
     Agency in accordance with the applicable law; and (b) deliver the original
     receipts, provided by the relevant Government Agency (if any), or other
     customary accounting data, for the amount paid within a reasonable period
     to the Party to whom the payment was to have been made.

                                       23
<PAGE>

13.0  QUALITY

13.1  The Seller will ensure that the Gas supplied to the Buyer under this
      Agreement: (a) is of merchantable quality, and conforms with the
      specifications set forth in Annexure 2; and (b) is not encumbered by any
                                  ----------
      charge, encumbrance, lien or other security interest.

13.2  Except as provided for in Clause 13.1 no representation, warranty or
                                -----------
      covenant as to the condition, merchantability, fitness for any particular
      purpose or otherwise is given by the Seller concerning the Gas.

13.3  The Seller shall employ reasonable commercial endeavours to notify the
      Buyer as soon as Seller has actual knowledge of any material variation
      between the Gas specifications of this Agreement and the Gas being
      delivered or to be delivered to the Delivery Point, including notification
      of the nature and extent of the variation.

14.0  ESTIMATES ON REQUEST

14.1  In order to assist the Seller in forward planning its operations, and the
      production and sale of Gas, the Seller's Representative may from time to
      time throughout the Term request that the Buyer's Representative provide
      Seller its estimated likely requirements of Gas for any period during the
      Term.

14.2  As soon as reasonably practicable after receiving a request from the
      Seller's Representative, the Buyer's Representative must submit the
      requested estimates of the Gas requirements to the Seller's Representative
      and the Buyer warrants that the estimates given by the Buyer's
      Representative will be the Buyer's good faith estimate of its likely Gas
      requirements.

15.0  NOTICE OF CHANGES IN OPERATING CONDITIONS

15.1  Each Party must use its reasonable endeavours to notify the other Party as
      soon as it becomes aware of expected changes in:

      (a) the rates of delivery or receipt of Gas; or

      (b) the pressures or other operating conditions of the Pipeline and the
          reason for those expected changes, to ensure that, as far as it is
          possible, the Parties may accommodate the changes if and when they
          occur.

                                       24
<PAGE>

15.2  The Buyer will inform the Seller of its best estimate of the number of
      Plant operating Days per Contract Year and any periods of regular major
      maintenance required. The Seller will inform the Buyer of any maintenance
      Days required by the Seller. Without limiting Clause 5.1, if possible the
                                                    ----------
      Parties will seek to schedule maintenance periods at the same time to
      minimise any disruption to each other's operations.

16.0  FORCE MAJEURE

16.1  If a Party is prevented from or delayed in performing wholly or in part,
      any of its Non-financial Obligations for a reason attributable to a Force
      Majeure Event ("Affected Party") it must give to the other Party prompt
      notice of the Force Majeure Event with reasonably full particulars of the
      Force Majeure Event, including to the extent possible its nature and
      estimated duration, and the Affected Party's Non-financial Obligations
      affected by it and the nature and extent of its effect on those
      obligations ("FM Notice").

16.2  The Non-financial Obligations of the Affected Party under this Agreement
      will be suspended in whole or in part, as the case may require, to the
      extent that the ability of that Party to perform any of its Non-financial
      Obligations is materially and adversely affected by the Force Majeure
      Event that is the subject of a FM Notice.

16.3  Suspension of any Non-financial Obligations pursuant to Clause 16.2 will
                                                              -----------
      not affect any rights or obligations which have accrued prior to such
      suspension or, if the Force Majeure Event affects only some Non-financial
      Obligations, any other obligations or rights of the Parties.

16.4  The period of suspension under Clause 16.2 of the Non-financial Obligation
                                     -----------
      of the Affected Party will exclude any delay in the Affected Party's
      performance of the Non-financial Obligations which are attributable to a
      failure by the Affected Party to comply with Clause 16.5.
                                                   -----------

16.5  The Affected Party will, subject to Clause 16.2 use all reasonable
                                          -----------
      endeavours to avoid or remove a Force Majeure Event and to mitigate the
      effect of that Force Majeure Event including considering steps that the
      other Party may reasonably request in connection with the Force Majeure
      Event.

16.6  During the period of suspension of any obligation of the Affected Party
      under Clause 16.2 the other Party may (but need not) make alternative
            -----------
      arrangements for the performance whether by another person or otherwise,
      of any obligation so suspended without incurring any liability to the
      Affected Party.

                                       25
<PAGE>

16.7  Nothing in this Clause 16 requires the Affected Party to settle any
                      ---------
      industrial labor dispute or meet the claims or demands of any Government
      Agency otherwise than as is commercially reasonable and no delay in making
      the settlement will deprive the Affected Party of the benefit of Clause
                                                                       ------
      16.2 provided that the Affected Party has complied with relevant
      ----
      industrial orders and awards and with applicable laws.

16.8  An Affected Party will as soon as practicable give notice to the other
      Party of the end of each Force Majeure Event the subject of an FM Notice
      and must as soon as reasonably possible after the end of that Force
      Majeure Event resume performance of any Non-financial Obligation suspended
      as a result of it.

16.9  Notwithstanding anything to the contrary in this Agreement, if the
      Affected Party is not able to resume performance of its Non-financial
      Obligations on or before a date that is twelve (12) Months after the
      Affected Party delivered an FM Notice, the other Party shall have the
      right to terminate this Agreement in accordance with Clause 19 as though
                                                           ---------
      the Affected Party had Defaulted. If the other Party elects to terminate
      the Agreement pursuant to this Clause: (a) the other Party shall deliver
      written notice at least sixty (60) days before the effective date of
      termination (which shall be in lieu of any other notices or notice periods
      provided for under Clause 19 and shall not occur before the date that is
                         ---------
      twelve (12) months after the Affected Party delivered the FM Notice); and
      (b) the Affected Party shall not become liable for the payment of any
      Financial Obligation which was suspended (in whole or in part) during the
      period the Force Majuere Event was in effect.

17.0  CREDITWORTHINESS

17.1  The Buyer must provide on a quarterly basis financial statements, evidence
      of debt and/or credit ratings, and other such information as is reasonably
      requested by Seller to establish or confirm the Buyer's creditworthiness.

17.2  All information provided to the Seller for credit evaluation purposes will
      be used by the Seller solely for the purpose of assessing the Buyer's
      creditworthiness and will be held in confidence.

18.0  FAILURE TO DELIVER GAS

18.1  If the Seller is unable (other than by reason of a Force Majeure Event,
      the Buyer's failure or inability to accept delivery, or for any reason
      specified under Clauses 5.1(c), 12.2 and 15) to deliver any quantity of
                      ---------------------------
      Gas to meet a Nominated Daily Take ("Undelivered Gas") then:

                                       26
<PAGE>

      (a) the Seller may cause ENERGEX Retail Pty Ltd. and or other sources to
          deliver an alternate supply of Gas equivalent in quality and quantity
          to the Undelivered Gas at Seller's sole cost and expense on the
          Nominated Day at a point of delivery which may be reasonably
          acceptable to Buyer; and

      (b) if Seller fails to cause third parties to deliver an alternate supply
          of Gas, (i) the Buyer may obtain an alternate supply of Gas equivalent
          in quantity and quality to the Undelivered Gas on the Nominated Day
          without giving notice to Seller pursuant to Clause 8 and (ii) subject
                                                      --------
          to Clause 18.2, the Seller will pay to the Buyer within 14 days of
             -----------
          receipt of a statement from the Buyer the amount by which the
          reasonable costs and expenses incurred by the Buyer in obtaining
          delivery of that alternate supply exceeds the amount that would have
          been paid to the Seller under this Agreement for the Undelivered Gas
          had it been delivered.

      (c) If Seller does not cover Undelivered Gas pursuant to Clause 18.1(a),
                                                               --------------
          and Buyer does not cover Undelivered Gas pursuant to Clause 18.1(b),
                                                               --------------
          the ACQ for that Contract Year shall be reduced by the amount of the
          Undelivered Gas for purposes of calculating Annual Makeup, Net ACQ and
          the Take or Pay Quantity as described in Clause 6.
                                                   --------

18.2  If the Seller fails to deliver any quantity of Gas to meet a Nominated
      Daily Take, and the Buyer has been unable to obtain an alternate supply of
      Gas for any reason, the Seller will not be liable for or be obligated to
      Buyer in respect of any costs, damages, expenses or other amounts incurred
      or suffered by Buyer.

19.0  DEFAULT

19.1  The Non-defaulting Party may terminate this Agreement by giving notice of
      the occurrence of a Default to the Defaulting Party, and this Agreement
      shall terminate immediately upon the Defaulting Party's receipt of that
      Default Notice (and the expiration of any cure period specified below) if
      the Defaulting Party:

      (a) incurs a Solvency Default;

      (b) defaults in its Financial Obligation under this Agreement and the
          Defaulting Party fails to remedy that breach within five (5) Business
          Days;

      (c) is in breach of any of its Non-financial Obligations under this
          Agreement and the Defaulting Party fails to remedy that breach within
          fifteen (15) Business Days (or such reasonably longer period as may be
          necessary to remedy the breach that the Non-defaulting Party consents
          to, which consent will not be unreasonably withheld) of receiving a
          notice specifying the breach from the Non-defaulting Party; or

                                       27
<PAGE>

      (d)  is in breach of any of its Non-financial Obligations under this
           Agreement which, in the reasonable opinion of an expert obtained by
           the Non-defaulting Party is incapable of being remedied.

      If the Buyer is the Defaulting Party and, in the opinion of the Seller the
      Default is capable of remedy but the Buyer has not undertaken such remedy,
      the Seller may suspend deliveries of Gas to the Buyer (without incurring
      any liability or obligation to Buyer) until the earlier to occur of:

      (i)  the lawful termination of this Agreement by the Seller under Clause
                                                                        ------
           19.1; or
           ----

      (ii) the Buyer's remedy of the Default to the reasonable satisfaction of
           the Seller.

19.2  If a Party terminates this Agreement under this Clause 19, the Defaulting
                                                      ---------
      Party must pay all moneys due to the Non-defaulting Party or accrued under
      this Agreement as at the date of termination.

19.3  The Defaulting Party will pay to the Non-defaulting Party interest on any
      amount which is the subject of a Financial Default. Such interest will
      accrue daily at a rate equal to the aggregate of the BB Rate plus a margin
      of two percent (2%) for each day from the date on which the amount became
      due and payable until such Default is cured and will be;

      (a)  payable on the first Business Day of each Month,

      (b)  calculated on actual days elapsed and a 365 day year, and

      (c)  capitalized on the first Business Day after the due date for payment
           of such interest, if not paid when due.

19.4  If a liability under this Agreement becomes merged in an order or judgment
      of one or more arbitrators pursuant to Clause 22, or a court of competent
                                             ---------
      jurisdiction, then the Defaulting Party will pay interest to the Non-
      defaulting Party on the amount of that liability as an independent
      obligation. This interest accrues from the date the liability becomes due
      for payment, both before and after the order or judgment, until it is
      paid, at a rate that is the higher of the rate payable under the order or
      judgment and a rate equal to the aggregate of the BB Rate plus a margin of
      two percent (2%).

19.5  Notwithstanding anything in this Agreement to the contrary: (a) neither
      Party shall be liable to the other (or to any third party), and each Party
      hereby irrevocably releases and waives any claim, demand or cause of
      action (whether legal, equitable or administrative), for indirect or
      consequential damages including, without limitation, damages resulting
      from disruption of business, lost

                                       28
<PAGE>

      production or lost profits, increased administrative, employee or overhead
      costs, purchasing or supplying any quantity of Products (or components,
      goods, inventories or materials used to Manufacture Products) or the costs
      of repairing damage to the other Party's property; and (b) Buyer
      acknowledges that Seller shall not be liable for any damages which Buyer
      may incur, except as provided in Clause 18 with respect to Undelivered
                                       ---------
      Gas, the Gas Price under this Agreement has been calculated and offered by
      Seller in reliance upon this consequential damages waiver.

19.6  The remedies available to the Non-defaulting Party pursuant to this Clause
                                                                          ------
      19 will be without prejudice to any other rights or remedies it may have
      --
      at law or in equity.

19.7  Termination of this Agreement will not affect any rights or obligations
      which may have accrued prior to termination, including in respect of
      antecedent breach and will not affect the obligations of each Party set
      out in Clauses 17, 20 or 24 which will continue in full force and effect
             --------------------
      despite the termination of this Agreement.

20.0  AUTHORITY, EFFECT AND GOVERNING LAW AND JURISDICTION

20.1  Each Party represents and warrants to the other Party now and at all times
      during the Term:

      (a) It is a company duly incorporated under the laws of Queensland and has
          the power and authority to enter into this Agreement and will have
          undertaken and complied with the necessary corporate proceedings to
          ensure this Agreement is enforceable and binding on it or before 31
          May, 2002 (unless otherwise terminated on or before that date);

      (b) This Agreement is legally valid, binding and includes enforceable
          obligations on it subject to the conditions and qualification set
          forth herein; and

      (c) The execution and delivery of this Agreement and the performance of
          any of the transactions contemplated by this Agreement do not and will
          not contravene or constitute a default or breach of any provision
          contained in any Law, judgment, order, Authorisation or in any
          contract or agreement by which it is bound; provided that Seller's
                                                      -------- ----
          performance is subject to approval of TCW Asset Management Company, et
          al pursuant to certain loan documents.

                                       29
<PAGE>

20.2  Each Party will:

      (a)  comply with, give all notices under, and pay all fees required by,
           any Law; and

      (b)  obtain all permits, licenses or approvals required under any Law, in
           respect of all matters arising in the performance of their respective
           obligations under this Agreement.

20.3  This Agreement is subject to and to be construed in accordance with the
      laws applicable in the State of Queensland and (subject to any arbitration
      agreement) the Parties submit to the non-exclusive jurisdiction of the
      Courts of that State.

21.0  SERVICE OF NOTICES

21.1  A notice by one Party to another Party will be sufficiently issued or
      served upon the Party to whom it is addressed if and only if it is
      addressed to the Buyer's Representative or the Seller's Representative (as
      the case may be) and:

      (a)  handed to that Representative; or

      (b)  sent by prepaid post to the address of that Representative specified
           in Clause 21.2 or such other address as may be advised by that
              -----------
           Representative to the other from time to time, in which event it will
           be deemed to have been received forty-eight (48) hours after it has
           been sent, or

      (c)  sent by facsimile to the facsimile number of that Representative
           specified in Clause 21.2 or such other facsimile number as may be
                        -----------
           advised by that Representative to the other from time to time, in
           which event it will be deemed to have been received:

           (i)  if the receiving Party does not advise the sender within twenty-
                four (24) working hours of receipt that the message was not
                fully intelligible; and

           (ii) if the sender receives electronic confirmation that the
                transmission was received by the receiving Party and has no
                reason to believe that at the time of transmission, the
                transmission was not fully intelligible; and

           on the day on which it was sent if transmission is completed by 4:00
           p.m. local time during a Business Day in the place of receipt,
           otherwise on the next Business Day in the place of receipt after the
           date it was sent.

                                       30
<PAGE>

21.2  For the purpose of this Clause 21, the initial addresses for service
                              ---------
      of notices on the Buyer and Seller will be:

      The Buyer's Representative:__________________________.

      The Seller's Representative:  Richard Barber.

22.0  DISPUTE RESOLUTION PROCESS

22.1  The Parties must meet to resolve any dispute or claim arising out of or in
      connection with this Agreement by good faith negotiations within (a) the
      number of days specified in the applicable Clause of this Agreement, or
      (b) within 30 days of receipt of notice of a dispute or claim, whichever
      is sooner.

22.2  If the Parties are unable to resolve any dispute or claim in accordance
      with Clause 22.1 within thirty (30) days of the commencement of those good
           -----------
      faith negotiations, the Parties must submit the dispute or claim to
      arbitration in accordance with and subject to the Institute of
      Arbitrators, Australia Rules for Conduct of Commercial Arbitration without
      prejudice to the rights of each Party to apply to the court for equitable
      relief.

22.3  Arbitration will be effected by three arbitrators. The Seller and Buyer
      shall each select one arbitrator. The third arbitrator:

      (a) will be selected by the mutual agreement of the arbitrators appointed
          by Seller and Buyer; or

      (b) failing agreement, selected by the President for the time being of the
          Institute of Arbitrators, Australia or the President's duly authorised
          representative.

      The third arbitrator shall be independent from the Seller and the Buyer;
      and shall not have any past or present interest in, or relationship with,
      the Seller, the Buyer or the subject matter of any dispute or claim
      submitted to arbitration.

22.4  The submission of any dispute or claim to arbitration in accordance with
      this Clause 22 will be subject to the provisions of the Commercial
           ---------
      Arbitration Act 1990 (Qld) and, for the purposes of that Act, the Parties
      agree that:

      (a) the reference of dispute or claim to arbitration will be deemed to be
          a submission to arbitration within the meaning of the Act, and

      (b) each Party may be represented by a duly qualified legal practitioner
          or other representative.

                                       31
<PAGE>

22.5  The venue of the arbitration will be Brisbane, Queensland.

22.6  The commencement or conduct of arbitration or litigation will not of
      itself absolve the Parties from their respective obligations under this
      Agreement.

22.7  The Parties agree not to commence litigation unless all avenues of
      alternative dispute resolution set out in this Clause 22 have been
                                                     ---------
      exhausted.

23.0  ASSIGNMENT

23.1  Neither Party may assign, novate, charge or otherwise encumber any of its
      rights or obligations under this Agreement, in whole or in part, without
      the prior written consent of the other Party, which consent must not be
      unreasonably withheld provided that Buyer hereby (a) authorizes Seller to
                            -------------
      present this Agreement to each of the participants in the Comet Ridge
      Project and (b) consents to a partial assignment of this Agreement to each
      of the participants in the Comet Ridge Project that wish to participate in
      the sales of Gas to Buyer to be made hereunder.

24.0  CONFIDENTIALITY

24.1  The Buyer and Seller covenant that throughout the Term and for five years
      after the expiration of the Term or termination of this Agreement neither
      Buyer nor Seller will disclose the Confidential Information or cause or
      permit it to be disclosed to any person without the prior written consent
      of, and on such conditions as may be prescribed by the other Party.

24.2  The Buyer's and Seller's obligation to maintain confidentiality will not
      include any portion of the Confidential Information that:

      (a) is required to be disclosed or published by law (which, for purposes
          of Seller includes, without limitation, securities and blue sky laws
          of the United States and any individual state) but only to the extent
          necessary in the opinion of the disclosing party's counsel;

      (b) is disclosed or published to the Seller or Buyer by a third party
          under circumstances not involving a breach of this Agreement or any
          other document of similar effect;

      (c) the Seller is contractually obligated to disclose to (i) the parties
          to the operating agreement covering the Comet Ridge Project which is
          applicable to the conduct of operations contemplated under Clause 2.1
                                                                     ----------
          of this Agreement, (ii) any credit agreement or loan documents binding
          upon Seller or its property; or (iii) any gas supply, risk management
          or other

                                       32
<PAGE>

          agreement which Seller may deliver to obtain alternate Gas supply
          sources to be able to meet its requirements under this Agreement; or

      (d) is disclosed by Seller or Buyer to their parent or affiliated
          companies for reasonable or necessary purposes of corporate management
          including, without limitation, accounting, administrative, finance,
          shareholder reporting or tax purposes.

25.0  MISCELLANEOUS

25.1  This Agreement contains the entire understanding of the Parties with
      respect to the transactions contemplated by this Agreement. There are no
      understandings, agreements, warranties or representations, express or
      implied with respect to the transactions contemplated by this Agreement,
      or any other understandings, agreements, warranties or representations
      except as specifically set out in this Agreement.

25.2  No failure or delay on the part of any Party to this Agreement in
      exercising any right, power or remedy under this Agreement and no course
      of dealing between the Parties to this Agreement will operate as a waiver
      of any breach or default by any other Party. No single or partial exercise
      of any such right, power or remedy will preclude any further or other
      exercise of that or any other right, power or remedy.

25.3  No provision of this Agreement may be varied or waived except in writing.

25.4  Each Party must at all times have, and ensure its contractors and
      subcontractors have, current public liability and workers' compensation
      insurance policies on terms and conditions and covering risks arising in
      respect of this Agreement reasonably acceptable to the other Party. Each
      Party must produce documentary evidence of such insurances if requested to
      do so by the other Party.

25.5  Each Party to this Agreement will bear its own costs of and incidental to
      this Agreement other than as specifically otherwise agreed in writing
      signed by the Party or Parties assuming any obligation, but the Buyer must
      pay all stamp duty assessed on the Agreement and any duplicate of it.

25.6  If any part of this Agreement is or becomes illegal, invalid or
      unenforceable in any relevant jurisdiction, the legality, validity or
      enforceability of the remainder of the Agreement will not be affected and
      this Agreement will be read as if the part had been deleted in that
      jurisdiction only.

25.7  The Obligations contain in this Agreement will continue until satisfied in
      full unless terminated earlier than the Term set forth in Clause 3, in
                                                                --------
      which case the obligations set forth in Clause 19 and 24 will apply.
                                              ----------------

                                       33
<PAGE>

25.8  This Agreement may consist of one or more counterpart copies and all
      counterparts will, when taken together, constitute one document.

25.9  Each Party must sign, execute and complete all additional documents which
      may be necessary to effect, perfect, or complete the provisions of this
      Agreement and the transactions to which it relates.

EXECUTED as an agreement.

THE, COMMON SEAL of TIPPERARY OIL & GAS (Australia)             )
Pty LTD (ACN 077 536 871 was duly affixed to this document in   )
accordance with its articles of association in the presence of: )

      /s/ Richard A. Barber                     /s/ David L. Bradshaw
-------------------------------------     -------------------------------------
Signature of Secretary                    Signature of Director

       Richard A. Barber                         David L. Bradshaw
-------------------------------------     -------------------------------------
Name of Secretary - please print          Name of Director - please print

THE COMMON SEAL OF QUEENSLAND                          )
FERTILIZER ASSETS LIMITED (ACN 011 062 294)            )
was duly affixed to this document in accordance        )
with its Articles of Association in the presence of:   )

      /s/ Harold James Keith Howes              /s/ John F. Babbitt
-------------------------------------     -------------------------------------
Signature of Secretary                    Signature of Director

       Harold James Keith Howes                  John F. Babbitt
-------------------------------------     -------------------------------------
Name of Secretary - please print          Name of Director - please print

                                       34
<PAGE>

                                   ANNEXURE 1
                                   ----------

                               GAS PRICE FORMULA
                               -----------------

1.   The Gas Price at the Delivery Point for the first two Contract Years will
     be [***] per Gigajoule.  Starting with the third Contract Year (but not
     later than 1 January 2006), the floor price of Gas delivered to the
     Delivery Point will be [***] per Gigajoule, as adjusted herein ("Floor
     Price").  The Gas Price is as follows after the first two Contract Years:

     (a)  If the average fob price for urea produced and shipped from the Plant
          in any calendar quarter starting with the third Contract Year (but not
          later than 1 January 2006) and any subsequent calendar quarter
          thereafter throughout the Term is less than A$220 per metric ton, the
          Gas Price is equal to the Floor Price, as adjusted;

     (b)  If the average fob price for urea produced and shipped from the Plant
          in any calendar quarter starting with the third Contract Year (but not
          later than 1 January 2006) and any subsequent calendar quarter
          thereafter throughout the Term is more than A$220 per metric ton, the
          Gas Price shall be as follows, if and only if, it results in a price
          higher than Floor Price, as adjusted:

        Gas Price  =  [***] {1 + 0.75 (fob urea price - 220)/220} A$/GJ

     (c)  Buyer agrees to permit Seller to audit Buyer's records as may be
          reasonable or necessary to validate the average fob price for urea
          produced and shipped from the Plant each calendar quarter;

     (d)  In addition to adjustments to the Gas Price set forth in Subclauses 1
          (a) and (b) above, the initial Floor Price of [***] will be increased
          each Contract Year starting with the third Contract Year (but not
          later than 1 January 2006) by either a factor of 2%; or 70% of the
          CPI; whichever is lower, compounded each year beginning at inception
          of the Contract throughout the Term of the Contract;

     (e)  The Parties agree that if the average market price of coalbed methane
          in the Bowen Surat Basin area of Queensland during the fifteenth
          Contract Year, (beginning on 1 January 2018) of the Agreement has
          escalated to a level in excess of $A 0.50 per Gigajoule above of the
          adjusted Floor Price in effect at the end of the fifteenth Contract
          Year under Subclauses 1 (a) and (b), the Floor Price shall increase by
          one-half of such excess.  If the Parties cannot agree to the average
          coalbed methane market price pursuant to Clause 3 below, they shall
          agree to appoint an independent arbitrator who shall make such
          determination.  Furthermore, the Parties agree that beginning with the
          first day of the sixteenth Contract Year of the Agreement, the 75%
          participation factor in urea pricing per Subclause 1 (b) above, will
          become 50%; and

*** Text has been omitted and filed separately with the Securities and Exchange
    Commission. Confidential treatment has been requested under 17 C.F.R.
    section 240.24b-2.
<PAGE>

     (f)  For purposes of this Annexure 1, Subclauses 1 (a), (b) and (d), it is
          agreed that the price for urea and the Gas Price are exclusive of
          Goods and Services Tax (GST).

2.   For purposes of calculating any adjustments and averages in respect the fob
     price of urea, it is agreed that:

     (a)  calendar quarters shall begin on January, April, July and October of
          each Contract Year;

     (b)  Buyer shall provide Seller its calculation (and supporting materials
          reasonably acceptable to Seller) for the average fob price for urea
          within ten (10) Days after the end of each calendar quarter;

     (c)  Seller shall utilize Buyer's calculation of the average fob price for
          the preceding calendar quarter to calculate (i) the final Gas Price in
          effect during the preceding calendar quarter (and any resulting
          increases to the amounts specified in the invoices for each Month
          during the preceding calendar quarter and (ii) the estimated Gas Price
          in effect for each Month during the then current calendar quarter
          (which Seller shall utilize for purposes of preparing invoices for
          Delivered Gas during the then current calendar quarter, subject to
          adjustment at the end of that calendar quarter in a like manner
          following the Buyer's calculation of the average fob price of urea for
          that calendar quarter), and

     (d)  Seller will include charges resulting from an increase or credits
          resulting from a decrease in the final Gas Price for the preceding
          calendar quarter in (i) the invoice for the first Month of the then
          current calendar quarter or, (ii) the first invoice as maybe
          practicable if the Buyer fails to deliver the calculation of the
          average fob price for urea when due, in which case Buyer shall pay
          interest at the BB Rate plus two percent (2%) from the date the
          additional charge would have become due (if Buyer delivered the
          average fob price calculation on time) until the date the charge is
          paid.

3.   For purposes of calculating adjustments and averages in respect of average
     coalbed methane market prices during the fifteenth Contract Year, it is
     agreed that:

     (a)  Seller shall utilize (i) the prices set forth each week/Month from the
          first week of January, 2018 through the last week of December, 2018
          for spot prices for the Bowen Surat Basin area of Queensland delivered
          to pipeline as published in a recognized publication utilized by the
          gas pipeline industry to establish spot price quotes in the Bowen
          Surat Basin area of Queensland, which is reasonably acceptable to
          Seller and Buyer or (ii) prices for sales of coalbed methane gas in
          the Bowen Surat Basin area of Queensland during that period which are
          comparable in availability to market, quality, quantity and time of
          sale of Delivered Gas (as compiled by Seller utilizing reasonable
          commercial endeavours from gas pipeline industry sources in
          Queensland, Australia which are reasonably acceptable to Buyer) if a
          recognized publication does not then exists;

                                       2
<PAGE>

     (b)  Seller shall provide Buyer its calculation (and supporting materials
          reasonably acceptable to Buyer) for the average market price of
          coalbed methane gas during the fifteenth Contract Year upon request;
          and

     (c)  Seller shall charge, and Buyer shall pay, the Floor Price (as adjusted
          pursuant to Subclause 1 (e) for all Delivered Gas beginning on 1
          January 2019.

4.   Adjustments to the Gas Price pursuant to Subclauses 1 (a), (b), (d) and (e)
     shall be cumulative.

5.   Either Party, at its own expense, shall have the right to examine, copy and
     audit all of the books and records of the other Party related to the
     calculation of the average fob price of urea, or the average market price
     of coalbed methane, which are provided by the other Party for purposes of
     adjusting the Gas Price pursuant to this Annexure, as follows:

     (a)  each Party shall have the right to audit and copy the books and
          records of the other Party after delivering written notice not less
          than fifteen (15) Business Days in advance of the date of proposed
          audit;

     (b)  all examinations and audits shall be conducted at the office of the
          Party being audited on one or more consecutive Business Days during
          normal business hours.  The Party being audited shall provide access
          to personnel and relevant records, as may be reasonable or necessary
          to assist the auditing Party's examiner or auditors to complete the
          examination or audit as expeditiously as possible;

     (c)  to the extent that the auditing Party should take exception to any
          portion of the  other Party's relevant books and records, the auditing
          Party shall provide the other Party with a written report summarizing
          reasons for the exceptions taken.  The audit report must be delivered
          no later than thirty (30) days following the completion of the
          examination or audit.  The other Party shall have fifteen (15) days
          from receipt of the report in which to prepare and submit a written
          response to the exceptions taken by the auditing Party.  If, after
          reviewing the other Party's response, any disagreements remain, the
          Parties' designated representatives shall meet for the purposes of
          resolving those disputes.  If, after meeting to discuss the remaining
          disputes, the representatives are not able to reach a compromise
          reasonably acceptable to each, either Party may request the initiation
          of arbitration pursuant to this Agreement; and

     (d)  the notices from either Party of an audit shall designate the agent or
          employee assigned to conduct the examination or audit on their behalf.
          The auditing Party shall cause the designated employee to work
          diligently to complete the examination or audit in a reasonable and
          prudent manner.

                                       3
<PAGE>

                                  ANNEXURE 2
                                  ----------

                               GAS SPECIFICATION
                               -----------------

The coalbed methane gas ('Gas') to be delivered by Seller to the Delivery Point
shall have the following specification:

     Methane            95.00% by volume minimum
     Total Inerts       5.00% by volume maximum
     Nitrogen           4.00% by volume maximum
     Oxygen             0.40% by volume maximum
     Carbon Dioxide     3.00% by volume maximum
     Total Sulfur       10.00 milligrams per cubic meter maximum
     Water              7.0 pounds maximum per million cubic feet
                        @ 60F and 14.7 psia
     NGL's              None above Ethane

Gas delivered to the Buyer under Clauses 8 and 18 which is not coal bed methane
shall conform to the specifications set out in the Gas Act of 1965, as amended.<PAGE>
                                                                  Exhibit 10.82

                             MR DAVID L. BRADSHAW

                   EMPLOYMENT AND CONFIDENTIALITY AGREEMENT

This Employment Agreement (this "Agreement") is made between TIPPERARY
CORPORATION, a Texas Corporation, with its principal place of business at 633
Seventeenth Street, Suite 1550, Denver, Colorado 80202 (the "Company") and David
L. Bradshaw, residing at 8998 West Brandt Drive, Littleton, Colorado 80123
("Executive").

WHEREAS, the Executive and the Company desire and agree to formalize an
employment relationship between them by means of this Agreement.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is mutually covenanted and
agreed by and between the parties as follows:

1.   EMPLOYMENT. The Company hereby employs the Executive and the Executive
     hereby accepts employment in the positions of Chairman, President and Chief
     Executive Officer.

2.   BASIC COMPENSATION AND BENEFITS. For the services rendered by the Executive
     to the Company, the Company shall pay the Executive a salary at the rate of
     $210,000 per year to be paid to the Executive in equal installments in
     accordance with the normal payroll policies of the Company (the "Basic
     Compensation") or as otherwise shall be agreed upon from time to time by
     the parties hereto. In addition, the Executive shall be entitled to any
     benefits and permitted to participate in any benefit plans, including
     without limitation any health care plans and paid vacation and sick leave,
     that the Company provides to its executives generally.

3.   BONUSES. In addition to the Basic Compensation, at the recommendation of
     the Compensation Committee and approval by the Board of Directors of the
     Company, the Executive may also receive additional compensation in the form
     of bonuses ("Bonuses") at times and in amounts to be determined by the
     Company's Compensation Committee based upon corporate and individual
     performance.

4.   AUTOMOBILE. The Company shall provide the Executive with the use of an
     automobile of the Executive's choice, provided that the monthly lease
     payment shall not exceed $1,000. The Company shall pay all reasonable
     expenses of operation of the automobile, including insurance and
     maintenance and repairs.

5.   CLUB MEMBERSHIP. The Executive will be entitled to join a Country Club
     suitable for business entertainment from time to time. The Company will pay
     the Club
<PAGE>

     membership fee, annual dues and all appropriate business entertainment
     expenses.

6.   DENVER OFFICE. The Executive shall office in Denver, Colorado.

7.   TERM. This Agreement shall commence on the date hereof, and shall remain in
     effect for a period of two (2) years (the "Employment Term") and will
     automatically renew for successive two (2) year periods, on a continuous
     basis, unless employment is terminated in accordance with Section 8 or 9
     hereunder.

8.   TERMINATION WITHOUT COMPENSATION.

     8.1  Total Disability.  If the Executive become "totally disabled", as
          defined below, the Company may terminate this Agreement by notice to
          the Executive, and as of the termination date, the Company shall have
          no further liability or obligation to the Executive hereunder except
          as follows: the Executive shall receive any unpaid Basic Compensation
          and Bonuses, if any, that have accrued through the date of
          termination.  For the purposes hereof, the Executive shall be deemed
          to be "totally disabled" if the Executive is considered totally
          disabled according to the definition under any group disability plan
          maintained by the Company and in effect at the time of termination, or
          in the absence of any plan, under applicable Social Security
          regulations.  In the event of any dispute under the Section 7.1, the
          Executive shall submit to a physical examination by a licensed
          physician mutually satisfactory to the Company and the Executive, the
          cost of such examination to be paid by the Company, and the
          determination of such physician shall be determinative.

     8.2  Death.  If the Executive dies during employment with the Company, this
          Agreement shall terminate on the date of death, and thereafter the
          Company shall not have any further liability or obligation to the
          Executive, his executors, administrators, heirs, assigns or any other
          person claiming under or through the Executive's estate except that
          the Executive's estate shall receive any unpaid Basic Compensation and
          Bonuses, if any, that have accrued through the date of death.

     8.3  Cause.  The Company may terminate the Employment Term for "cause", as
          defined herein below, by giving the Executive 15 days notice of the
          termination date, and as of the termination date, the Company shall
          have no further liability or obligation to the Executive hereunder
          except the Executive shall receive any unpaid Basic Compensation and
          Bonuses, if any, that have accrued through the date of termination,
          less any liabilities that the Executive may have to the Company.  For
          purposes of the Agreement, "cause", shall mean the Executive's (i)
          failure to observe or perform any of the material terms or provisions
          of this Agreement, (ii) failure to comply fully with the lawful
          directives of the Board of

                                      -2-
<PAGE>

          Directors, (iii) disclosure or use of any confidential information of
          the Company, (iv) participation directly or indirectly or providing
          information which results in competition with the Company, (v)
          deception, (vi) wilful misconduct, (vii) material neglect of the
          Company's business, (viii) conviction of a felony or other crime
          involving moral turpitude, (ix) misappropriation of funds, or (x)
          habitual insobriety.

9.   TERMINATION WITH COMPENSATION

     The Company shall have the right to terminate the Agreement without cause
     any time by giving the Executive one year's notice of the termination date.
     Under such circumstances, the Company shall pay any unpaid Basic
     Compensation and Bonuses, if any, that have accrued through the date of
     termination, and shall continue to pay to the Executive the Basic
     Compensation which accrues for one year following the termination date (the
     "Termination Compensation"), and  the Company shall have no other liability
     or obligation to the Executive.  The Executive shall not be entitled to any
     Termination Compensation unless the Executive executes and delivers to the
     Company a release, in a form satisfactory to the Company, whereby the
     Executive releases the Company from any obligations and liabilities of any
     type with exception to the Termination Compensation as provided herein.
     The Termination Compensation shall be provided in consideration for the
     above-specified release.

10.  DUTIES AND EXTENT OF SERVICES. The Executive shall, on a full time basis,
     devote his entire business efforts to the Company, as Chairman, President
     and Chief Executive Officer, and shall perform in a timely and professional
     manner acceptable to the Company, those tasks assigned by the Company in
     conjunction with such positions; provided, however, that the Executive may
     engage in personal investment activities so long as such activities do not
     interfere with the performance of his duties to the Company herein.

11.  OWNERSHIP. The Executive agrees that all developments made and developments
     and works created by the Executive or under the Executive's direction in
     connection with the Company's assignments are works for hire and shall be
     the sole and complete property of the Company.

12.  NONDISCLOSURE OF CONFIDENTIAL INFORMATION

     12.1  Nondisclosure. During the term of employment and forever thereafter,
           the Executive agrees to keep confidential all information provided by
           the Company, its executives, directors, agents, or any other person
           or entity, excepting only such information as is already known to the
           public, and including any such information and material relating to
           any customer, vendor, licensor, licensee, or other party

                                      -3-
<PAGE>

           transacting business with the Company, and not to release, use, or
           disclose the same except with the prior written permission of the
           Company. The Executive further agrees to consider all information or
           products with which the Executive becomes familiar as an Executive of
           the Company to be confidential and the exclusive property of the
           Company which will not be converted or disclosed to anyone for any
           purpose whatsoever. All records, files, memorandums, reports, price
           lists, customer lists, maps, plans, sketches, documents and the like,
           relating to the business of the Company, which the Executive shall
           use or prepare or come into contact with, shall remain the sole
           property of the Company. A breach of this Section 12.1 shall give
           rise to "cause" under which the Executive may be terminated under
           Section 8.3.

     12.2  Possession. The Executive agrees that, upon request by the Company,
           and in any event upon termination of employment, the Executive shall
           turn over to the Company all documents, papers, or other material in
           his possession or under his control which may contain or be derived
           from confidential information, together with all documents, notes, or
           other work product which is connected with or derived from the
           Executive's services to the Company whether or not such material is
           at the date hereof in the Executive's possession. The Executive
           agrees that the Executive shall have no proprietary interest in any
           work product developed or used by the Executive and arising out of
           his employment by the Company. A breach of this section 12.2 shall
           give rise to "cause" under which the Executive may be terminated
           under Section 8.3.

     12.3  Survival of Covenant. The undertakings of the Section 12 of this
           Agreement shall survive the termination or cancellation of the
           Agreement or of the Executive's employment.

13.  COVENANT NOT TO COMPETE. For a period of 24 months from the date of any
     termination of the Executive's employment with the Company, the Executive
     shall not, directly or indirectly, accept employment with or render any
     services to any business engaged in the exploration for or production of
     oil and gas in Queensland Australia, form an association which is
     competitive with the Company, or form an association with or employ or
     offer to employ in a business competitive with the Company, anyone who is
     or has been a director, officer, shareholder, employee or Executive of the
     Company.

     The Executive acknowledges that the restrictions imposed by this Agreement
     are fully understood by him and will not preclude the Executive from
     becoming gainfully employed following a termination of employment with the
     Company.

14.  REMEDIES. The Executive agrees that this Agreement is intended to protect
     and preserve legitimate business interests of the Company. It is further
     agreed that any breach

                                      -4-
<PAGE>

     of this Agreement may render irreparable harm to the Company. In the event
     of a breach by the Executive, the Company shall have available to it all
     remedies provided by law, including, but not limited to, permanent
     injunctive relief to restrain the Executive from violating this Agreement.
     The Company shall also be entitled to commence legal action against the
     Executive for any breach of any confidentiality agreement and/or
     confidentiality programs in effect at any time between the Executive and
     the Company. Notwithstanding any legal remedies available to the Company as
     a result of a breach of this Agreement, in the event of a breach by the
     Executive, the Company shall immediately be entitled to withhold and avoid
     payment of any sums of money or other benefits than due or that become due
     under this or any other Agreement between the Executive and the Company.

15.  GENERAL PROVISIONS.

     15.1  No Waiver. The failure of the Company to terminate this Agreement for
           the breach of any condition or covenant herein by the Executive shall
           not affect the Company's right to terminate for subsequent breaches
           of the same or other conditions or covenants. The failure of either
           party to enforce at any time or for any period of time any of the
           provisions of this Agreement shall not be construed as a waiver of
           such provisions or of the right of the party thereafter to enforce
           each and every such provision.

     15.2  Notices. All notices and other required communications to the parties
           shall be in writing and shall be addressed respectively as follows,
           unless and until directed otherwise in writing:-

           If to Company

           Chairman of the Compensation Committee of
           The Board of Directors
           Tipperary Corporation
           633 Seventeenth Street Suite 1550
           Denver, Colorado 80202

           Tel: (303) 293 - 9379
           Fax: (303) 203 - 3428

           If to Executive

           David L Bradshaw
           8998 West Brandt Drive
           Littleton, Colorado 80123

                                      -5-
<PAGE>

           Tel: (303) 933 - 1168
           Fax: (303) 979 - 6578

     15.3  Entire Contract and Facsimile Execution. This Agreement shall
           constitute the entire contract between the parties and supercedes all
           existing agreements between them, whether oral or written, with
           respect to the subject matter hereof. No change, modification or
           amendment of this Agreement shall be of any effect unless in writing
           signed by the Executive and by a Director of the Compensation
           Committee of the Company.

     15.4  Governing Law. This Agreement shall be construed and enforced in
           accordance with, and the rights of the parties shall be governed by,
           the laws of the State of Colorado without regard to principles of
           conflicts of laws.

     15.5  Severability. Should any provision of this Agreement not be
           enforceable in any jurisdiction, the remainder of the Agreement shall
           not be affected thereby.

     15.6  Captions. The captions in this Agreement are for convenience only and
           shall not affect the construction or interpretation of any term or
           provision hereof.

     15.7  Attorney Fees. In the event of a dispute between the parties that
           results in litigation or arbitration regarding this Agreement, the
           prevailing party, as determined by the finder of fact, shall be
           entitled to an award of reasonable attorney fees.

     15.8  Further Assurances. Without further consideration, each party agrees
           to take such further acts and execute such further documents as are
           necessary or appropriate to effectuate the purpose and intent of this
           Agreement.

     15.9  Duration. This Agreement shall continue to bind the parties for as
           long as any obligations remain under the terms of this contract.

IN WITNESS WHEREOF, the parties hereto have signed this Agreement on this 18th
day of September, 2001.

                              EXECUTIVE:

                              /s/ David L. Bradshaw
                              --------------------------------

                                      -6-
<PAGE>

                                 TIPPERARY CORPORATION

                                 By: /s/ Marshall Lees
                                     ----------------------------------------
                                     (Chairman of the Compensation Committee)

                                      -7-

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