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

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

  67502   TRACT  1                                                      259
          --------
          TWP 079 RGE 16 W6M SEC 35

          INC : PETROLEUM AND NATURAL GAS

          DOWN TO BASE OF 34004 ARTEX-HALFWAY-DOIG

          34004 ARTEX-HALFWAY-DOIG ZONE DEFINED IN THE INTERVAL 
          1864.8M-2028.1M ON THE BOREHOLE COMPENSATED SONIC LOG 
          OF THE WELL W.A. 6717 10-18-79-14 W6M

          THE PARCEL OVERLAPS WITH THE TRADITIONAL TERRITORY OF 
          TREATY 8 FIRST NATIONS. FOLLOWING THE DECISION OF THE 
          BRITISH COLUMBIA SUPREME COURT IN YAHEY V BRITISH 
          COLUMBIA, ANY ADDITIONAL SURFACE DISTURBANCE IS 
          SUBJECT TO A CUMULATIVE EFFECTS ANALYSIS.  SURFACE 
          DISTURBANCE, INCLUDING ACCESS AND WELLSITE 
          CONSTRUCTION, MAY BE UNNECESSARY OR RESTRICTED IN 
          ORDER TO AVOID OR MINIMIZE CUMULATIVE IMPACTS ON FIRST 
          NATION AND ENVIRONMENTAL VALUES. APPLICATIONS FOR OIL 
          AND GAS ACTIVITIES MAY BE DENIED BASED ON IMPACTS TO 
          THESE VALUES.
          THE PARCEL OVERLAPS A LAND USE PLAN THAT HAS BEEN 
          DEVELOPED BY DOIG RIVER FIRST NATION (DRFN). FUTURE 
          ACTIVITIES WITHIN THE PLAN AREA MAY BE SUBJECT TO 
          ADDITIONAL CONDITIONS TO PROTECT AND RESTORE FIRST 
          NATION CULTURAL AND ENVIRONMENTAL VALUES, MANAGE 
          CUMULATIVE EFFECTS AND PROTECT TREATY RIGHTS. THE 
          PROVINCE HAS NOT ENDORSED THE LAND USE PLAN AT THIS 
          TIME BUT IS CURRENTLY WORKING ON DEVELOPING A JOINT 
          LAND USE PLAN WITH DRFN. UNTIL A JOINT LAND USE PLAN 
          IS IN PLACE, THE PROVINCE CONSIDERS DRFN�S LAND USE 
          PLAN AS A POTENTIAL SOURCE OF INFORMATION ABOUT DRFN�S 
          EXERCISE OF THEIR TREATY RIGHTS AND OTHER INTERESTS. 
          PLEASE CONTACT DOIG RIVER FIRST NATION FOR MORE 
          INFORMATION REGARDING THEIR PLAN.
          THE BC ENERGY REGULATOR (BCER) REQUIRES PROPONENTS TO 
          CONDUCT PRE-ENGAGEMENT WITH AFFECTED FIRST NATIONS 
          WHEN PLANNING ENERGY RESOURCE ACTIVITIES. PROPONENTS 
          MUST SUBMIT A PRE-ENGAGEMENT RECORD WITH ANY 
          APPLICATION TO THE BCER FOR ENERGY RESOURCE ACTIVITIES 
          WITHIN THIS TENURE. FOR MORE INFORMATION, REFER TO THE 
          BCER PRE-ENGAGEMENT GUIDANCE DOCUMENT.
          THE PARCEL OVERLAPS TREATY 8 TERRITORY. THE BC ENERGY 
          REGULATOR (BCER) REQUIRES OPERATORS TO EMPLOY TREATY 8 
          PLANNING AND MITIGATION MEASURES (MEASURES) FOR ALL 
          APPLICATIONS WITHIN THE TREATY 8 AREA. THE MEASURES 
          ARE A FIRST STEP IN THE AIM TO PROTECT FIRST NATION 
          AND ENVIRONMENTAL VALUES, INCLUDING BUT NOT LIMITED TO 
          WATERBODIES, WETLANDS, WATER, RIPARIAN MANAGEMENT 


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

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

          AREAS, WILDLIFE AND WILDLIFE HABITAT, VEGETATION, AND 
          AIR QUALITY. THE REGULATOR ENCOURAGES APPLICANTS TO 
          USE THE PRE-ENGAGEMENT PROCESS WITH FIRST NATIONS TO 
          ENSURE THEIR PROJECTS ALIGN WITH THE MEASURES AND 
          ADDRESS ANY OTHER CONCERNS BROUGHT FORWARD BEFORE 
          SUBMITTING APPLICATIONS. FOR MORE INFORMATION, REFER 
          TO THE BCER TREATY 8 PLANNING AND MITIGATION MEASURES 
          DOCUMENT.
          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:
          - WATER QUALITY AND WATERSHED VALUES
          - SURFACE WATER
          - STREAMS, WETLANDS, LAKES
          - FIRST NATION TRAPPING, HUNTING AND FISHING VALUES
          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):
          - PRIVATE LAND
          - MINERAL, COAL AND/OR PLACER RESERVES
          THE MINISTRY OF TRANSPORTATION AND TRANSIT (MOTT) HAS 
          ADVISED THAT PERMITTING AND APPROVAL FROM MOTT IS 
          REQUIRED AS OUTLINED ON THEIR WEBSITE, WHICH INCLUDES 
          BUT IS NOT LIMITED TO ANY PROPOSED USE WITHIN MOTT 
          PUBLIC HIGHWAY DEDICATION. FOR MORE INFORMATION, 
          CONTACT MOTT.
          PARCEL WITHIN OR PARTIALLY WITHIN THE AGRICULTURAL 
          LAND RESERVE (ALR); RESTORATION OF SURFACE SOIL ON 
          DISTURBED AREAS REQUIRED. PRECAUTIONS REQUIRED TO 
          PREVENT THE INTRODUCTION OR SPREAD OF INVASIVE PLANTS 
          AND PLANT DISEASES. USE OF ALR LANDS FOR INDUSTRY 
          OTHER THAN AGRICULTURE MAY REQUIRE REVIEW AND APPROVAL 
          BY THE AGRICULTURAL LAND COMMISSION.
          PARCEL CONTAINS OR IS NEAR AREAS OF HIGH AGRICULTURAL 
          ACTIVITY AND TRAFFIC. THE TENURE HOLDER IS ENCOURAGED 
          TO CONSIDER POTENTIAL IMPACTS ON AGRICULTURE TRAFFIC 
          AND USE OF ROADS IN PLANNING FOR DEVELOPMENT, 
          PARTICULARLY DURING SPRING AND FALL.
          RECORDED AND POTENTIAL ARCHAEOLOGICAL SITES EXIST; 
          ARCHAEOLOGICAL IMPACT ASSESSMENT MAY BE REQUIRED.
          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.
          HOLDING TENURE DOES NOT GUARANTEE THE ISSUANCE OF A 
          PERMIT TO CONDUCT OIL AND GAS ACTIVITY. TENURE HOLDERS 


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

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

          MUST APPLY FOR ACTIVITY PERMITS FROM THE BC ENERGY 
          REGULATOR (REGULATOR) UNDER THE ENERGY RESOURCE 
          ACTIVITIES ACT AND/OR FROM OTHER AGENCIES WHERE 
          APPLICABLE. THE REGULATOR MAY DENY PERMIT APPLICATIONS 
          OR MAY IMPOSE CONDITIONS ON ACTIVITY PERMITS.

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

          NO FURTHER TRACTS                      REF.NO. 2505001

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

  67503   TRACT  1                                                      519
          --------
          TWP 080 RGE 16 W6M SEC 1

          INC : PETROLEUM AND NATURAL GAS

          DOWN TO BASE OF 34004 ARTEX-HALFWAY-DOIG

          34004 ARTEX-HALFWAY-DOIG ZONE DEFINED IN THE INTERVAL 
          1864.8M-2028.1M ON THE BOREHOLE COMPENSATED SONIC LOG 
          OF THE WELL W.A. 6717 10-18-79-14 W6M

          TRACT  2
          --------
          TWP 080 RGE 16 W6M SEC 2

          INC : PETROLEUM AND NATURAL GAS

          DOWN TO BASE OF 34004 ARTEX-HALFWAY-DOIG

          34004 ARTEX-HALFWAY-DOIG ZONE DEFINED IN THE INTERVAL 
          1864.8M-2028.1M ON THE BOREHOLE COMPENSATED SONIC LOG 
          OF THE WELL W.A. 6717 10-18-79-14 W6M

          EXC : PETROLEUM AND NATURAL GAS

          IN 44014 BLUESKY-GETHING

          44014 BLUESKY-GETHING ZONE DEFINED IN THE INTERVAL 
          1309.6M-1468.6M ON THE BHC SONIC LOG OF THE WELL W.A. 
          5364 12-25-79-16 W6M

          EXC : PETROLEUM AND NATURAL GAS

          IN 42014 CADOMIN-DUNLEVY-NIKANASSIN

          42014 CADOMIN-DUNLEVY-NIKANASSIN ZONE DEFINED IN THE 


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

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

          INTERVAL 1468.6M-1576.4M ON THE BHC SONIC LOG OF THE 
          WELL W.A. 5364 12-25-79-16 W6M

          THE PARCEL OVERLAPS WITH THE TRADITIONAL TERRITORY OF 
          TREATY 8 FIRST NATIONS. FOLLOWING THE DECISION OF THE 
          BRITISH COLUMBIA SUPREME COURT IN YAHEY V BRITISH 
          COLUMBIA, ANY ADDITIONAL SURFACE DISTURBANCE IS 
          SUBJECT TO A CUMULATIVE EFFECTS ANALYSIS.  SURFACE 
          DISTURBANCE, INCLUDING ACCESS AND WELLSITE 
          CONSTRUCTION, MAY BE UNNECESSARY OR RESTRICTED IN 
          ORDER TO AVOID OR MINIMIZE CUMULATIVE IMPACTS ON FIRST 
          NATION AND ENVIRONMENTAL VALUES. APPLICATIONS FOR OIL 
          AND GAS ACTIVITIES MAY BE DENIED BASED ON IMPACTS TO 
          THESE VALUES.
          THE PARCEL OVERLAPS A LAND USE PLAN THAT HAS BEEN 
          DEVELOPED BY DOIG RIVER FIRST NATION (DRFN). FUTURE 
          ACTIVITIES WITHIN THE PLAN AREA MAY BE SUBJECT TO 
          ADDITIONAL CONDITIONS TO PROTECT AND RESTORE FIRST 
          NATION CULTURAL AND ENVIRONMENTAL VALUES, MANAGE 
          CUMULATIVE EFFECTS AND PROTECT TREATY RIGHTS. THE 
          PROVINCE HAS NOT ENDORSED THE LAND USE PLAN AT THIS 
          TIME BUT IS CURRENTLY WORKING ON DEVELOPING A JOINT 
          LAND USE PLAN WITH DRFN. UNTIL A JOINT LAND USE PLAN 
          IS IN PLACE, THE PROVINCE CONSIDERS DRFN�S LAND USE 
          PLAN AS A POTENTIAL SOURCE OF INFORMATION ABOUT DRFN�S 
          EXERCISE OF THEIR TREATY RIGHTS AND OTHER INTERESTS. 
          PLEASE CONTACT DOIG RIVER FIRST NATION FOR MORE 
          INFORMATION REGARDING THEIR PLAN.
          THE BC ENERGY REGULATOR (BCER) REQUIRES PROPONENTS TO 
          CONDUCT PRE-ENGAGEMENT WITH AFFECTED FIRST NATIONS 
          WHEN PLANNING ENERGY RESOURCE ACTIVITIES. PROPONENTS 
          MUST SUBMIT A PRE-ENGAGEMENT RECORD WITH ANY 
          APPLICATION TO THE BCER FOR ENERGY RESOURCE ACTIVITIES 
          WITHIN THIS TENURE. FOR MORE INFORMATION, REFER TO THE 
          BCER PRE-ENGAGEMENT GUIDANCE DOCUMENT.
          THE PARCEL OVERLAPS TREATY 8 TERRITORY. THE BC ENERGY 
          REGULATOR (BCER) REQUIRES OPERATORS TO EMPLOY TREATY 8 
          PLANNING AND MITIGATION MEASURES (MEASURES) FOR ALL 
          APPLICATIONS WITHIN THE TREATY 8 AREA. THE MEASURES 
          ARE A FIRST STEP IN THE AIM TO PROTECT FIRST NATION 
          AND ENVIRONMENTAL VALUES, INCLUDING BUT NOT LIMITED TO 
          WATERBODIES, WETLANDS, WATER, RIPARIAN MANAGEMENT 
          AREAS, WILDLIFE AND WILDLIFE HABITAT, VEGETATION, AND 
          AIR QUALITY. THE REGULATOR ENCOURAGES APPLICANTS TO 
          USE THE PRE-ENGAGEMENT PROCESS WITH FIRST NATIONS TO 
          ENSURE THEIR PROJECTS ALIGN WITH THE MEASURES AND 
          ADDRESS ANY OTHER CONCERNS BROUGHT FORWARD BEFORE 
          SUBMITTING APPLICATIONS. FOR MORE INFORMATION, REFER 
          TO THE BCER TREATY 8 PLANNING AND MITIGATION MEASURES 
          DOCUMENT.
          ACCESS, EXPLORATION AND CONSTRUCTION RESTRICTIONS MAY 


                                   PAGE     4
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:
          - WATER QUALITY AND WATERSHED VALUES
          - SURFACE WATER
          - STREAMS, WETLANDS, LAKES
          - FIRST NATION TRAPPING, HUNTING AND FISHING VALUES
          - BEAVER
          - WILDLIFE AND WILDLIFE HABITAT
          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):
          - PRIVATE LAND
          - MINERAL, COAL AND/OR PLACER RESERVES
          THE MINISTRY OF TRANSPORTATION AND TRANSIT (MOTT) HAS 
          ADVISED THAT PERMITTING AND APPROVAL FROM MOTT IS 
          REQUIRED AS OUTLINED ON THEIR WEBSITE, WHICH INCLUDES 
          BUT IS NOT LIMITED TO ANY PROPOSED USE WITHIN MOTT 
          PUBLIC HIGHWAY DEDICATION. FOR MORE INFORMATION, 
          CONTACT MOTT.
          PARCEL WITHIN OR PARTIALLY WITHIN THE AGRICULTURAL 
          LAND RESERVE (ALR); RESTORATION OF SURFACE SOIL ON 
          DISTURBED AREAS REQUIRED. PRECAUTIONS REQUIRED TO 
          PREVENT THE INTRODUCTION OR SPREAD OF INVASIVE PLANTS 
          AND PLANT DISEASES. USE OF ALR LANDS FOR INDUSTRY 
          OTHER THAN AGRICULTURE MAY REQUIRE REVIEW AND APPROVAL 
          BY THE AGRICULTURAL LAND COMMISSION.
          PARCEL CONTAINS OR IS NEAR AREAS OF HIGH AGRICULTURAL 
          ACTIVITY AND TRAFFIC. THE TENURE HOLDER IS ENCOURAGED 
          TO CONSIDER POTENTIAL IMPACTS ON AGRICULTURE TRAFFIC 
          AND USE OF ROADS IN PLANNING FOR DEVELOPMENT, 
          PARTICULARLY DURING SPRING AND FALL.
          RECORDED AND POTENTIAL ARCHAEOLOGICAL SITES EXIST; 
          ARCHAEOLOGICAL IMPACT ASSESSMENT MAY BE REQUIRED.
          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.
          HOLDING TENURE DOES NOT GUARANTEE THE ISSUANCE OF A 
          PERMIT TO CONDUCT OIL AND GAS ACTIVITY. TENURE HOLDERS 
          MUST APPLY FOR ACTIVITY PERMITS FROM THE BC ENERGY 
          REGULATOR (REGULATOR) UNDER THE ENERGY RESOURCE 
          ACTIVITIES ACT AND/OR FROM OTHER AGENCIES WHERE 
          APPLICABLE. THE REGULATOR MAY DENY PERMIT APPLICATIONS 
          OR MAY IMPOSE CONDITIONS ON ACTIVITY PERMITS.




                                   PAGE     5
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. 2505002

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














































                                   PAGE     6



                       Parcels Offered and Hectares Summary


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

            Permits                          0                0
            Drilling Licences                0                0
            Leases                           2              778

            Grand Total                      2              778














































