JOINT STUDY AGREEMENT

BETWEEN

PETROCHINA COMPANY LIMITED

AND

SUNWING ENERGY LTD.

TO CONDUCT

A JOINT FEASIBILITY STUDY

OF THE YUDONG BLOCK

IN CHONGQING MUNICIPALITY

FOR THE PURPOSES OF

ENTERING INTO PRODUCTION SHARING CONTRACTS

Surwing Energy Ltd. (Sunwing) sent a team of technical experts to visit the Southwest Oil and Gas field Company in Chengdu, Sichuan (SWOG) in November 2000. SWOG is a subsidiary of PetroChina Company Limited (PetroChina). Technical experts from SWOG presented overviews on the potential of six (6) exploration blocks. After further evaluation of the preliminary data presented to Sunwing, Sunwing has recommended to PetroChina that further detailed study of the Yudong block is required prior to any negotiations of a Production Sharing Contract. Following additional discussion in January and February 2001, PetroChina and Sunwing have agreed to sign this Joint Study Agreement (JSA).

ARTICLE 1
OBJECTIVE

Sunwing and PetroChina will form a Joint Study Team (Study Team) and will cooperate diligently to carry out a Joint Feasibility Study (JFS) to confirm the geophysical and geological model of the area, to estimate the ultimate natural gas and oil potential of the area, to evaluate improved drilling technology, to evaluate completion and stimulation solutions to improve gas and oil recovery and establish economic criteria for a potential development. Once this block is approved for foreign cooperation by the relevant department of the Chinese Government, the parties will commence to negotiate a Production Sharing Contract.

The Study Team will prepare interim progress reports and a final report recommending either onward work program or no further activity on the block. The purpose of conducting the JFS is to study the natural gas and oil reserve potentials associated with this block and if considered feasible, a Production Sharing Contract would be entered into between PetroChina and Sunwing.

ARTICLE 2 
WORK SCHEDULE AND SCOPE OF STUDY AND TECHNICAL REQUIREMENTS

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