PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

  66983   TRACT  1                                                      259
          --------
          TWP 084 RGE 20 W6M SEC 29

          INC : PETROLEUM AND NATURAL GAS

          BELOW BASE OF 33015 MONTNEY (EXCLUDING BASAL LAG)

          33015 MONTNEY (EXCLUDING BASAL LAG) ZONE IDENTIFIED IN 
          THE INTERVAL 1777.0M-2061.7M ON THE DIGITAL ACOUSTILOG 
          AND THE COMPENSATED Z-DENSILOG COMPENSATED NEUTRON LOG 
          OF THE WELL W.A. 11374 13-36-84-21 W6M

          THE GRANT OF TENURE DOES NOT GUARANTEE THE ISSUANCE OF 
          A PERMIT TO CONDUCT OIL AND GAS ACTIVITY. SUCCESSFUL 
          BIDDERS MUST APPLY FOR ACTIVITY PERMITS FROM THE BC 
          OIL AND GAS COMMISSION (COMMISSION) UNDER THE OIL AND 
          GAS ACTIVITIES ACT AND/OR FROM OTHER AGENCIES WHERE 
          APPLICABLE. THE COMMISSION MAY DENY PERMIT 
          APPLICATIONS OR MAY IMPOSE CONDITIONS ON ACTIVITY 
          PERMITS.
          PARCEL OVERLAPS CROWN LAND LOCATED WITHIN THE TREATY 
          #8 AREA AND THE PROVINCE STRONGLY ENCOURAGES EARLY 
          PRE-APPLICATION ENGAGEMENT WITH THE RELEVANT FIRST 
          NATIONS; PLEASE CONTACT THE BC OIL AND GAS COMMISSION 
          FOR GUIDANCE. PARCEL WAS REFERRED TO THE FOLLOWING 
          FIRST NATION(S) FOR REVIEW AND COMMENT (NOTE THAT 
          SUBSEQUENT CONSULTATION WITH FIRST NATIONS, NOT 
          NECESSARILY LIMITED TO THOSE LISTED BELOW, MAY BE 
          REQUIRED PRIOR TO ACTIVITIES BEING AUTHORIZED ON CROWN 
          LAND):
          - BLUEBERRY RIVER FIRST NATIONS
          - DOIG RIVER FIRST NATION
          - HALFWAY RIVER FIRST NATION
          - WEST MOBERLY FIRST NATIONS
          THE FOLLOWING FIRST NATION(S) HAS/HAVE ADVISED THAT 
          THE AREA IS USED FOR PRACTISING THEIR TREATY RIGHTS:
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - WEST MOBERLY FIRST NATIONS
          - DENE THA' FIRST NATION
          THE FOLLOWING FIRST NATION(S) HAS/HAVE REQUESTED EARLY 
          ENGAGEMENT, PRIOR TO SUBMITTING AN APPLICATION TO THE 
          OIL AND GAS COMMISSION, TO PROVIDE THE PROPONENT WITH 
          THE OPPORTUNITY TO DISCUSS FIRST NATION(S) INTERESTS 
          (ASSESSMENTS; MONITORING STUDIES; AND MITIGATION, 
          MANAGEMENT AND/OR RECLAMATION PLANS MAY BE REQUESTED):
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - DOIG RIVER FIRST NATION
          ACCESS, EXPLORATION AND CONSTRUCTION RESTRICTIONS MAY 


                                   PAGE     1
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          APPLY TO PROTECT ACTIVITIES AND INTERESTS IDENTIFIED 
          IN THE AREA BY ONE OR MORE FIRST NATIONS. THESE 
          INCLUDE BUT ARE NOT LIMITED TO:
          - TRAPLINE(S)
          - HUNTING
          - FISHING
          - WILDLIFE AND WILDLIFE HABITAT
          - UNGULATE HABITAT
          - WILDLIFE VALUES
          - CULTURALLY SIGNIFICANT SITE(S) AND CULTURAL HERITAGE 
          RESOURCES.
          - BURIAL SITES
          - HISTORIC AND CURRENT TRANSPORTATION CORRIDORS (LAND 
          AND WATER)
          - SURFACE WATER
          - WATER QUALITY AND WATERSHED VALUES
          - STREAMS, WETLANDS, LAKES
          - HABITATION SITES
          CONCERNS AND ISSUES IN THE AREA IDENTIFIED BY ONE OR 
          MORE FIRST NATIONS INCLUDE:
          - WATER QUALITY AND WATERSHED VALUES
          - CUMULATIVE EFFECTS
          - FLOODING RESERVE
          - UNCONVENTIONAL OIL AND GAS DEVELOPMENT
          - LINEAR DISTURBANCE
          PARCEL IS LOCATED NEAR COMMUNITY WATER SOURCE. THE 
          CITY OF FORT ST. JOHN REQUESTS ENGAGEMENT TO DISCUSS 
          EXPLORATION AND DEVELOPMENT PLANS PRIOR TO 
          ON-THE-GROUND ACTIVITIES.
          PARCEL IS LOCATED WITHIN HORN RIVER, MONTNEY OR 
          CORDOVA EMBAYMENT BOUNDARIES IN WHICH SHALE GAS 
          RECOVERY AND TECHNOLOGY IS ANTICIPATED; PARTICIPATION 
          IN A WATER OR ACCESS PLANNING PROCESS WITH OTHER 
          TENURE HOLDERS MAY BE REQUIRED TO COORDINATE 
          ACTIVITIES, EXPLORATION AND DEVELOPMENT.
          THE BC OIL AND GAS COMMISSION USES AREA BASED ANALYSIS 
          (ABA) AS A TOOL IN THE APPLICATION REVIEW PROCESS; 
          THIS PARCEL OVERLAPS ABA "ENHANCED MANAGEMENT" STATUS 
          WITHIN RIPARIAN RESERVE ZONES (FOR MORE INFORMATION 
          CONTACT THE COMMISSION).
          ACCESS AND CONSTRUCTION RESTRICTIONS MAY APPLY. PRIOR 
          TO ON-THE-GROUND ACTIVITY, CONTACT THE APPROPRIATE 
          PROVINCIAL MINISTRY FOR APPLICABLE MANAGEMENT AND 
          PROTECTION MEASURES TO MINIMIZE DISTURBANCE AND 
          ADDRESS THE FOLLOWING (NOT LIMITED TO):
           - CRITICAL WILDLIFE/FISHERIES VALUES; HABITAT IMPACT 
          ASSESSMENT MAY BE REQUIRED PRIOR TO ACCESS OR 
          DEVELOPMENT
          - RANGE ACT TENURE(S)
          - PRIVATE LAND
          PARCEL WITHIN OR PARTIALLY WITHIN THE AGRICULTURAL 


                                   PAGE     2
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          LAND RESERVE; RESTORATION OF SURFACE SOIL ON DISTURBED 
          AREAS REQUIRED. PRECAUTIONS REQUIRED TO PREVENT THE 
          INTRODUCTION OR SPREAD OF INVASIVE PLANTS AND PLANT 
          DISEASES.
          POTENTIAL FOR ARCHAEOLOGICAL RESOURCES EXISTS; 
          ARCHAEOLOGICAL IMPACT ASSESSMENT MAY BE REQUIRED.

          TERM           :    5  YEARS
          FEES           :     $500.00
          RENT PER HA    :       $7.50

          NO FURTHER TRACTS                      REF.NO. 1904005

---------------------------------------------------------------------------

  66984   TRACT  1                                                      262
          --------
          TWP 084 RGE 21 W6M SEC 26

          INC : PETROLEUM AND NATURAL GAS

          BELOW BASE OF 38008 BALDONNEL

          38008 BALDONNEL ZONE DEFINED IN THE INTERVAL 
          4026'-4140' ON THE BHCS-GR LOG OF THE WELL W.A. 4159 
          7-34-85-17 W6M

          EXC : PETROLEUM AND NATURAL GAS

          IN 33015 MONTNEY (EXCLUDING BASAL LAG)

          33015 MONTNEY (EXCLUDING BASAL LAG) ZONE IDENTIFIED IN 
          THE INTERVAL 1777.0M-2061.7M ON THE DIGITAL ACOUSTILOG 
          AND THE COMPENSATED Z-DENSILOG COMPENSATED NEUTRON LOG 
          OF THE WELL W.A. 11374 13-36-84-21 W6M

          THE GRANT OF TENURE DOES NOT GUARANTEE THE ISSUANCE OF 
          A PERMIT TO CONDUCT OIL AND GAS ACTIVITY. SUCCESSFUL 
          BIDDERS MUST APPLY FOR ACTIVITY PERMITS FROM THE BC 
          OIL AND GAS COMMISSION (COMMISSION) UNDER THE OIL AND 
          GAS ACTIVITIES ACT AND/OR FROM OTHER AGENCIES WHERE 
          APPLICABLE. THE COMMISSION MAY DENY PERMIT 
          APPLICATIONS OR MAY IMPOSE CONDITIONS ON ACTIVITY 
          PERMITS.
          PARCEL OVERLAPS CROWN LAND LOCATED WITHIN THE TREATY 
          #8 AREA AND THE PROVINCE STRONGLY ENCOURAGES EARLY 
          PRE-APPLICATION ENGAGEMENT WITH THE RELEVANT FIRST 
          NATIONS; PLEASE CONTACT THE BC OIL AND GAS COMMISSION 
          FOR GUIDANCE. PARCEL WAS REFERRED TO THE FOLLOWING 
          FIRST NATION(S) FOR REVIEW AND COMMENT (NOTE THAT 
          SUBSEQUENT CONSULTATION WITH FIRST NATIONS, NOT 


                                   PAGE     3
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          NECESSARILY LIMITED TO THOSE LISTED BELOW, MAY BE 
          REQUIRED PRIOR TO ACTIVITIES BEING AUTHORIZED ON CROWN 
          LAND):
          - BLUEBERRY RIVER FIRST NATIONS
          - DOIG RIVER FIRST NATION
          - HALFWAY RIVER FIRST NATION
          - WEST MOBERLY FIRST NATIONS
          THE FOLLOWING FIRST NATION(S) HAS/HAVE ADVISED THAT 
          THE AREA IS USED FOR PRACTISING THEIR TREATY RIGHTS:
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - WEST MOBERLY FIRST NATIONS
          - DENE THA' FIRST NATION
          THE FOLLOWING FIRST NATION(S) HAS/HAVE REQUESTED EARLY 
          ENGAGEMENT, PRIOR TO SUBMITTING AN APPLICATION TO THE 
          OIL AND GAS COMMISSION, TO PROVIDE THE PROPONENT WITH 
          THE OPPORTUNITY TO DISCUSS FIRST NATION(S) INTERESTS 
          (ASSESSMENTS; MONITORING STUDIES; AND MITIGATION, 
          MANAGEMENT AND/OR RECLAMATION PLANS MAY BE REQUESTED):
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - DOIG RIVER FIRST NATION
          ACCESS, EXPLORATION AND CONSTRUCTION RESTRICTIONS MAY 
          APPLY TO PROTECT ACTIVITIES AND INTERESTS IDENTIFIED 
          IN THE AREA BY ONE OR MORE FIRST NATIONS. THESE 
          INCLUDE BUT ARE NOT LIMITED TO:
          - WILDLIFE VALUES
          - CULTURALLY SIGNIFICANT SITE(S) AND CULTURAL HERITAGE 
          RESOURCES.
          - BURIAL SITES
          - HISTORIC AND CURRENT TRANSPORTATION CORRIDORS (LAND 
          AND WATER)
          - SURFACE WATER
          - WATER QUALITY AND WATERSHED VALUES
          - STREAMS, WETLANDS, LAKES
          - HUNTING
          - HABITATION SITES
          - WILDLIFE AND WILDLIFE HABITAT
          - TRAPLINE(S)
          - FISHING
          - UNGULATE HABITAT
          CONCERNS AND ISSUES IN THE AREA IDENTIFIED BY ONE OR 
          MORE FIRST NATIONS INCLUDE:
          - WATER QUALITY AND WATERSHED VALUES
          - CUMULATIVE EFFECTS
          - FLOODING RESERVE
          - UNCONVENTIONAL OIL AND GAS DEVELOPMENT
          - LINEAR DISTURBANCE
          PARCEL IS LOCATED NEAR COMMUNITY WATER SOURCE. THE 
          CITY OF FORT ST. JOHN REQUESTS ENGAGEMENT TO DISCUSS 
          EXPLORATION AND DEVELOPMENT PLANS PRIOR TO 


                                   PAGE     4
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          ON-THE-GROUND ACTIVITIES.
          PARCEL IS LOCATED WITHIN HORN RIVER, MONTNEY OR 
          CORDOVA EMBAYMENT BOUNDARIES IN WHICH SHALE GAS 
          RECOVERY AND TECHNOLOGY IS ANTICIPATED; PARTICIPATION 
          IN A WATER OR ACCESS PLANNING PROCESS WITH OTHER 
          TENURE HOLDERS MAY BE REQUIRED TO COORDINATE 
          ACTIVITIES, EXPLORATION AND DEVELOPMENT.
          THE BC OIL AND GAS COMMISSION USES AREA BASED ANALYSIS 
          (ABA) AS A TOOL IN THE APPLICATION REVIEW PROCESS; 
          THIS PARCEL OVERLAPS ABA "ENHANCED MANAGEMENT" STATUS 
          WITHIN RIPARIAN RESERVE ZONES (FOR MORE INFORMATION 
          CONTACT THE COMMISSION).
          ACCESS AND CONSTRUCTION RESTRICTIONS MAY APPLY. PRIOR 
          TO ON-THE-GROUND ACTIVITY, CONTACT THE APPROPRIATE 
          PROVINCIAL MINISTRY FOR APPLICABLE MANAGEMENT AND 
          PROTECTION MEASURES TO MINIMIZE DISTURBANCE AND 
          ADDRESS THE FOLLOWING (NOT LIMITED TO):
           - CRITICAL WILDLIFE/FISHERIES VALUES; HABITAT IMPACT 
          ASSESSMENT MAY BE REQUIRED PRIOR TO ACCESS OR 
          DEVELOPMENT
          - GRAZING LEASE
          - PRIVATE LAND
          PARCEL WITHIN OR PARTIALLY WITHIN THE AGRICULTURAL 
          LAND RESERVE; RESTORATION OF SURFACE SOIL ON DISTURBED 
          AREAS REQUIRED. PRECAUTIONS REQUIRED TO PREVENT THE 
          INTRODUCTION OR SPREAD OF INVASIVE PLANTS AND PLANT 
          DISEASES.
          POTENTIAL FOR ARCHAEOLOGICAL RESOURCES EXISTS; 
          ARCHAEOLOGICAL IMPACT ASSESSMENT MAY BE REQUIRED.

          TERM           :    5  YEARS
          FEES           :     $500.00
          RENT PER HA    :       $7.50

          NO FURTHER TRACTS                      REF.NO. 1904007

---------------------------------------------------------------------------

  66985   TRACT  1                                                      262
          --------
          TWP 084 RGE 21 W6M SEC 35

          INC : PETROLEUM AND NATURAL GAS

          ALL ZONES

          EXC : PETROLEUM AND NATURAL GAS

          IN 33015 MONTNEY (EXCLUDING BASAL LAG)

          33015 MONTNEY (EXCLUDING BASAL LAG) ZONE IDENTIFIED IN 


                                   PAGE     5
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          THE INTERVAL 1777.0M-2061.7M ON THE DIGITAL ACOUSTILOG 
          AND THE COMPENSATED Z-DENSILOG COMPENSATED NEUTRON LOG 
          OF THE WELL W.A. 11374 13-36-84-21 W6M

          THE GRANT OF TENURE DOES NOT GUARANTEE THE ISSUANCE OF 
          A PERMIT TO CONDUCT OIL AND GAS ACTIVITY. SUCCESSFUL 
          BIDDERS MUST APPLY FOR ACTIVITY PERMITS FROM THE BC 
          OIL AND GAS COMMISSION (COMMISSION) UNDER THE OIL AND 
          GAS ACTIVITIES ACT AND/OR FROM OTHER AGENCIES WHERE 
          APPLICABLE. THE COMMISSION MAY DENY PERMIT 
          APPLICATIONS OR MAY IMPOSE CONDITIONS ON ACTIVITY 
          PERMITS.
          PARCEL OVERLAPS CROWN LAND LOCATED WITHIN THE TREATY 
          #8 AREA AND THE PROVINCE STRONGLY ENCOURAGES EARLY 
          PRE-APPLICATION ENGAGEMENT WITH THE RELEVANT FIRST 
          NATIONS; PLEASE CONTACT THE BC OIL AND GAS COMMISSION 
          FOR GUIDANCE. PARCEL WAS REFERRED TO THE FOLLOWING 
          FIRST NATION(S) FOR REVIEW AND COMMENT (NOTE THAT 
          SUBSEQUENT CONSULTATION WITH FIRST NATIONS, NOT 
          NECESSARILY LIMITED TO THOSE LISTED BELOW, MAY BE 
          REQUIRED PRIOR TO ACTIVITIES BEING AUTHORIZED ON CROWN 
          LAND):
          - BLUEBERRY RIVER FIRST NATIONS
          - DOIG RIVER FIRST NATION
          - HALFWAY RIVER FIRST NATION
          - WEST MOBERLY FIRST NATIONS
          THE FOLLOWING FIRST NATION(S) HAS/HAVE ADVISED THAT 
          THE AREA IS USED FOR PRACTISING THEIR TREATY RIGHTS:
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - DENE THA' FIRST NATION
          THE FOLLOWING FIRST NATION(S) HAS/HAVE REQUESTED EARLY 
          ENGAGEMENT, PRIOR TO SUBMITTING AN APPLICATION TO THE 
          OIL AND GAS COMMISSION, TO PROVIDE THE PROPONENT WITH 
          THE OPPORTUNITY TO DISCUSS FIRST NATION(S) INTERESTS 
          (ASSESSMENTS; MONITORING STUDIES; AND MITIGATION, 
          MANAGEMENT AND/OR RECLAMATION PLANS MAY BE REQUESTED):
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - DOIG RIVER FIRST NATION
          ACCESS, EXPLORATION AND CONSTRUCTION RESTRICTIONS MAY 
          APPLY TO PROTECT ACTIVITIES AND INTERESTS IDENTIFIED 
          IN THE AREA BY ONE OR MORE FIRST NATIONS. THESE 
          INCLUDE BUT ARE NOT LIMITED TO:
          - WILDLIFE VALUES
          - CULTURALLY SIGNIFICANT SITE(S) AND CULTURAL HERITAGE 
          RESOURCES.
          - BURIAL SITES
          - HISTORIC AND CURRENT TRANSPORTATION CORRIDORS (LAND 
          AND WATER)
          - SURFACE WATER


                                   PAGE     6
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          - WATER QUALITY AND WATERSHED VALUES
          - STREAMS, WETLANDS, LAKES
          - HUNTING
          - TRAPLINE(S)
          - FISHING
          - WILDLIFE AND WILDLIFE HABITAT
          - UNGULATE HABITAT
          CONCERNS AND ISSUES IN THE AREA IDENTIFIED BY ONE OR 
          MORE FIRST NATIONS INCLUDE:
          - WATER QUALITY AND WATERSHED VALUES
          - CUMULATIVE EFFECTS
          - FLOODING RESERVE
          - ARCHAEOLOGICAL POTENTIAL AND EXISTING ARCHAEOLOGICAL 
          SITES
          - UNCONVENTIONAL OIL AND GAS DEVELOPMENT
          PARCEL IS LOCATED NEAR COMMUNITY WATER SOURCE. THE 
          CITY OF FORT ST. JOHN REQUESTS ENGAGEMENT TO DISCUSS 
          EXPLORATION AND DEVELOPMENT PLANS PRIOR TO 
          ON-THE-GROUND ACTIVITIES.
          PARCEL IS LOCATED WITHIN HORN RIVER, MONTNEY OR 
          CORDOVA EMBAYMENT BOUNDARIES IN WHICH SHALE GAS 
          RECOVERY AND TECHNOLOGY IS ANTICIPATED; PARTICIPATION 
          IN A WATER OR ACCESS PLANNING PROCESS WITH OTHER 
          TENURE HOLDERS MAY BE REQUIRED TO COORDINATE 
          ACTIVITIES, EXPLORATION AND DEVELOPMENT.
          ACCESS AND CONSTRUCTION RESTRICTIONS MAY APPLY. PRIOR 
          TO ON-THE-GROUND ACTIVITY, CONTACT THE APPROPRIATE 
          PROVINCIAL MINISTRY FOR APPLICABLE MANAGEMENT AND 
          PROTECTION MEASURES TO MINIMIZE DISTURBANCE AND 
          ADDRESS THE FOLLOWING (NOT LIMITED TO):
           - CRITICAL WILDLIFE/FISHERIES VALUES; HABITAT IMPACT 
          ASSESSMENT MAY BE REQUIRED PRIOR TO ACCESS OR 
          DEVELOPMENT
          - GRAZING LEASE
          - PRIVATE LAND
          PARCEL WITHIN OR PARTIALLY WITHIN THE AGRICULTURAL 
          LAND RESERVE; RESTORATION OF SURFACE SOIL ON DISTURBED 
          AREAS REQUIRED. PRECAUTIONS REQUIRED TO PREVENT THE 
          INTRODUCTION OR SPREAD OF INVASIVE PLANTS AND PLANT 
          DISEASES.
          RECORDED AND POTENTIAL ARCHAEOLOGICAL SITES EXIST; 
          ARCHAEOLOGICAL IMPACT ASSESSMENT MAY BE REQUIRED.











                                   PAGE     7
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          TERM           :    5  YEARS
          FEES           :     $500.00
          RENT PER HA    :       $7.50

          NO FURTHER TRACTS                      REF.NO. 1904008

---------------------------------------------------------------------------

  66986   TRACT  1                                                      260
          --------
          TWP 084 RGE 21 W6M SEC 36

          INC : PETROLEUM AND NATURAL GAS

          BELOW BASE OF 36002 CHARLIE LAKE (EXCL. BELOW 'A' 
          MARKER)

          36002 CHARLIE LAKE (EXCLUDING BELOW 'A' MARKER) ZONE 
          DEFINED IN THE INTERVAL 5001.2'-5970.7' ON THE GAMMA 
          RAY NEUTRON LOG OF THE WELL W.A. 238 C-53-D/094-B-09

          EXC : PETROLEUM AND NATURAL GAS

          IN 33015 MONTNEY (EXCLUDING BASAL LAG)

          33015 MONTNEY (EXCLUDING BASAL LAG) ZONE IDENTIFIED IN 
          THE INTERVAL 1777.0M-2061.7M ON THE DIGITAL ACOUSTILOG 
          AND THE COMPENSATED Z-DENSILOG COMPENSATED NEUTRON LOG 
          OF THE WELL W.A. 11374 13-36-84-21 W6M

          THE GRANT OF TENURE DOES NOT GUARANTEE THE ISSUANCE OF 
          A PERMIT TO CONDUCT OIL AND GAS ACTIVITY. SUCCESSFUL 
          BIDDERS MUST APPLY FOR ACTIVITY PERMITS FROM THE BC 
          OIL AND GAS COMMISSION (COMMISSION) UNDER THE OIL AND 
          GAS ACTIVITIES ACT AND/OR FROM OTHER AGENCIES WHERE 
          APPLICABLE. THE COMMISSION MAY DENY PERMIT 
          APPLICATIONS OR MAY IMPOSE CONDITIONS ON ACTIVITY 
          PERMITS.
          PARCEL OVERLAPS CROWN LAND LOCATED WITHIN THE TREATY 
          #8 AREA AND THE PROVINCE STRONGLY ENCOURAGES EARLY 
          PRE-APPLICATION ENGAGEMENT WITH THE RELEVANT FIRST 
          NATIONS; PLEASE CONTACT THE BC OIL AND GAS COMMISSION 
          FOR GUIDANCE. PARCEL WAS REFERRED TO THE FOLLOWING 
          FIRST NATION(S) FOR REVIEW AND COMMENT (NOTE THAT 
          SUBSEQUENT CONSULTATION WITH FIRST NATIONS, NOT 
          NECESSARILY LIMITED TO THOSE LISTED BELOW, MAY BE 
          REQUIRED PRIOR TO ACTIVITIES BEING AUTHORIZED ON CROWN 
          LAND):
          - BLUEBERRY RIVER FIRST NATIONS
          - DOIG RIVER FIRST NATION
          - HALFWAY RIVER FIRST NATION


                                   PAGE     8
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          - WEST MOBERLY FIRST NATIONS
          THE FOLLOWING FIRST NATION(S) HAS/HAVE ADVISED THAT 
          THE AREA IS USED FOR PRACTISING THEIR TREATY RIGHTS:
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          THE FOLLOWING FIRST NATION(S) HAS/HAVE REQUESTED EARLY 
          ENGAGEMENT, PRIOR TO SUBMITTING AN APPLICATION TO THE 
          OIL AND GAS COMMISSION, TO PROVIDE THE PROPONENT WITH 
          THE OPPORTUNITY TO DISCUSS FIRST NATION(S) INTERESTS 
          (ASSESSMENTS; MONITORING STUDIES; AND MITIGATION, 
          MANAGEMENT AND/OR RECLAMATION PLANS MAY BE REQUESTED):
          - BLUEBERRY RIVER FIRST NATIONS
          - HALFWAY RIVER FIRST NATION
          - DOIG RIVER FIRST NATION
          ACCESS, EXPLORATION AND CONSTRUCTION RESTRICTIONS MAY 
          APPLY TO PROTECT ACTIVITIES AND INTERESTS IDENTIFIED 
          IN THE AREA BY ONE OR MORE FIRST NATIONS. THESE 
          INCLUDE BUT ARE NOT LIMITED TO:
          - WILDLIFE VALUES
          - CULTURALLY SIGNIFICANT SITE(S) AND CULTURAL HERITAGE 
          RESOURCES.
          - BURIAL SITES
          - HISTORIC AND CURRENT TRANSPORTATION CORRIDORS (LAND 
          AND WATER)
          - SURFACE WATER
          - WATER QUALITY AND WATERSHED VALUES
          - STREAMS, WETLANDS, LAKES
          - HUNTING
          - TRAPLINE(S)
          - FISHING
          - WILDLIFE AND WILDLIFE HABITAT
          - UNGULATE HABITAT
          CONCERNS AND ISSUES IN THE AREA IDENTIFIED BY ONE OR 
          MORE FIRST NATIONS INCLUDE:
          - WATER QUALITY AND WATERSHED VALUES
          - CUMULATIVE EFFECTS
          - FLOODING RESERVE
          - UNCONVENTIONAL OIL AND GAS DEVELOPMENT
          PARCEL IS LOCATED NEAR COMMUNITY WATER SOURCE. THE 
          CITY OF FORT ST. JOHN REQUESTS ENGAGEMENT TO DISCUSS 
          EXPLORATION AND DEVELOPMENT PLANS PRIOR TO 
          ON-THE-GROUND ACTIVITIES.
          PARCEL IS LOCATED WITHIN HORN RIVER, MONTNEY OR 
          CORDOVA EMBAYMENT BOUNDARIES IN WHICH SHALE GAS 
          RECOVERY AND TECHNOLOGY IS ANTICIPATED; PARTICIPATION 
          IN A WATER OR ACCESS PLANNING PROCESS WITH OTHER 
          TENURE HOLDERS MAY BE REQUIRED TO COORDINATE 
          ACTIVITIES, EXPLORATION AND DEVELOPMENT.
          ACCESS AND CONSTRUCTION RESTRICTIONS MAY APPLY. PRIOR 
          TO ON-THE-GROUND ACTIVITY, CONTACT THE APPROPRIATE 
          PROVINCIAL MINISTRY FOR APPLICABLE MANAGEMENT AND 


                                   PAGE     9
PETROLEUM AND NATURAL GAS LEASE
-------------------------------

PARCEL    LEGAL DESCRIPTION                                            HA  
-------   -------------------------------------------------------    ------

          PROTECTION MEASURES TO MINIMIZE DISTURBANCE AND 
          ADDRESS THE FOLLOWING (NOT LIMITED TO):
           - CRITICAL WILDLIFE/FISHERIES VALUES; HABITAT IMPACT 
          ASSESSMENT MAY BE REQUIRED PRIOR TO ACCESS OR 
          DEVELOPMENT
          - GRAZING LEASE
          - PRIVATE LAND
          PARCEL WITHIN OR PARTIALLY WITHIN THE AGRICULTURAL 
          LAND RESERVE; RESTORATION OF SURFACE SOIL ON DISTURBED 
          AREAS REQUIRED. PRECAUTIONS REQUIRED TO PREVENT THE 
          INTRODUCTION OR SPREAD OF INVASIVE PLANTS AND PLANT 
          DISEASES.
          POTENTIAL FOR ARCHAEOLOGICAL RESOURCES EXISTS; 
          ARCHAEOLOGICAL IMPACT ASSESSMENT MAY BE REQUIRED.

          TERM           :    5  YEARS
          FEES           :     $500.00
          RENT PER HA    :       $7.50

          NO FURTHER TRACTS                      REF.NO. 1904009

---------------------------------------------------------------------------































                                   PAGE    10



                       Parcels Offered and Hectares Summary


                                   No. Offered         Hectares
                                   -----------         --------

            Permits                          0                0
            Drilling Licences                0                0
            Leases                           4             1043

            Grand Total                      4             1043














































