Water Well @ Bammel

Nathan tells me that he has a request in to you for a dollar evaluation of
the Hamill Gas Unit #1 water well that EOG recently assigned and conveyed
over to HPL at my request. Please advise me at your earliest convenience
what that value may be so that we can appropriately get it on our asset
ledger. I am also awaiting a response from John Towles as to a clearer plat
on this property as was originally requested by EOG some time ago which I
assume we will use as an exhibit to the Operating Agreement..

Also, by copy hereof, I ask that Gerald or his designee prepare an Operating
Agreement between HPL and Merl Vanek whereby Merl will be entitled to operate
this well for purposes of his grazing lease at this facility. HPL desires
that Merl operate this well at his sole cost and expense and maintain it in
good working order. We can make the term of this Operating Agreement
coterminous with his grazing lease which is established under an October 1,
1998 Grazing Lease with an original term of one year from that date and
year-to-year thereafter unless sooner terminated by at least 90 days' advance
written notice prior to the end of the original term or any renewal term
thereafter by one party to the other. Merl's address is 2634 Milroy Lane,
Houston, TX 77088 with a phone number of 281-444-8689 and a fax number of
281-587-4200. I have already advised Merl of the effective ownership of this
well by HPL and he will be operating it accordingly as his need to do so is
urgent, so I request that this document be prepared as soon as possible in
consideration of HPL's liability.

Thanks to all for your help on this.