November 26, 2004
DELTA OIL & GAS INC.
1122 6 Ave. N. Seattle, Washington
98109 - USA
Re: Participation
Proposal
Hillsprings Property,
Alberta
______________________________________________________________
Whereas Win Energy Corporation
(“Win”) has acquired a land position in the above noted
property and whereas Delta Oil & Gas Inc. (“Delta”)
has expressed an interest in participating with Win in future
operations in its Hillsprings Property, the following proposal is
submitted for review and consideration:
1. Win currently owns a working interest in
the lands and leases described as the “Purchase Lands”
in Schedule “A” attached hereto. In addition Win
controls the lands described as the “Option Lands” in
Schedule “A”
2. Delta shall pay the sum of Four hundred
fourteen thousand and Seven hundred and Sixty Six ($414,766 US)
dollars (US Funds) (hereinafter referred to
as
the “Purchase Price”) to Win to acquire a 10% working
interest in the Purchase Lands subject only to the encumbrances
shown in Schedule “A”.
3. The Purchase Price shall be payable to
Win in the form of a certified cheque and shall be payable and
received by Win on or before December 31,
2004.
4. Upon receipt of the Purchase Price from
Delta by Win, Win shall prepare and circulate for execution by
Delta a Joint Operating Agreement incorporating
the 1981 Operating Procedure together with the 1996 PASC Accounting
Procedure utilizing standard rates, elections and amendments. The
Joint
Operating Agreement shall govern all operations on the Purchase
Lands between the parties hereto. The parties hereto agree in
advance that the 1981
Operating Procedure shall utilize elective 2401 (B) establishing a
right of first refusal on subsequent dispositions by the parties
hereto.
Win Energy Corporation
Suite
240, 640 - 8 th Avenue S.W. Calgary, Alberta, T2P
1G7
Bus:
(404) 265-7787 - Fax: (403) 265-7767
5. Win shall be named Initial
Operator under the Joint Operating Agreement and shall conduct all
operations with respect to the Purchase Lands in
accordance therewith.
6. Delta shall have an option exercisable
in writing to acquire a 10% working interest in the Option Lands.
In the event Delta elects to acquire such interest,
it shall pay the sum of $207,833 (US Funds) to Win. Delta shall
have until 4 pm (MST) on July 1, 2005 to exercise this option and
provide payment to
Win as proposed in this clause. Failure to elect in writing or make
the payment contemplated herein by this date shall terminate
Delta’s right to acquire an
interest in the Option Lands.
7.
The Effective Date of this transaction shall be the date on which
Win has received the Purchase Price.
8. This offer is subject to approval by the
Board of
