IVANHOE ENERGY INC
LOAN AGREEMENT
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>o12765exv10w1.htm
<DESCRIPTION>LOAN AGREEMENT
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<B><FONT size="2">Exhibit 10.1</FONT></B>

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<FONT size="6">Loan Agreement
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<B><FONT size="4">Pan-China Resources Ltd</FONT></B>

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<B><FONT size="4">Richfirst Holdings Limited</FONT></B>

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<FONT size="5">Loan Agreement
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<B><FONT size="2">Table of Contents</FONT></B>

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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">1.&nbsp;&nbsp;&nbsp;Definitions and
    Interpretation</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">1</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">1.1&nbsp;Definitions
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">1</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">1.2&nbsp;Interpretation
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">3</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">2.&nbsp;&nbsp;&nbsp;Purpose</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">4</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">3.&nbsp;&nbsp;&nbsp;Making of
    Advance</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">4</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">4.&nbsp;&nbsp;&nbsp;Interest</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">4</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">4.1&nbsp;Rate
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">4</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">4.2&nbsp;Payment of interest
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">4</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">5.&nbsp;&nbsp;&nbsp;Cancellation of
    Commitment</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">4</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">6.&nbsp;&nbsp;&nbsp;Repayment</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">5</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">7.&nbsp;&nbsp;&nbsp;Set-off of Advance against
    Payment under FOA</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">5</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">8.&nbsp;&nbsp;&nbsp;Payments</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">5</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">8.1&nbsp;Manner
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">5</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">8.2&nbsp;Payment to be made on Business Day
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">5</FONT></TD>
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    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">8.3&nbsp;Appropriation where insufficient moneys
    available
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    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">9.&nbsp;&nbsp;&nbsp;Additional
    Payments</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">6</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">10.&nbsp;Representations and
    Warranties</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">6</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">10.1&nbsp;Representations and warranties
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">10.2&nbsp;Reliance on representations and
    warranties
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">8</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">11.&nbsp;Undertakings</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">8</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">11.1&nbsp;General undertakings
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">8</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">11.2&nbsp;Term of undertakings
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">9</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">12.&nbsp;Events of Default</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">10</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">12.1&nbsp;Events of Default
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">10</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">12.2&nbsp;Consequences
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">13.&nbsp;Conditions Precedent</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">13</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">13.1&nbsp;Conditions precedent to Drawdown Notice
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">13</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">13.2&nbsp;Conditions precedent to Advance
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">13</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">14.&nbsp;Interest on Overdue Amounts</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">13</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">14.1&nbsp;Accrual and payment
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">13</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">15.&nbsp;Indemnities</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">13</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">16.&nbsp;Expenses</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">14</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">17.&nbsp;Waivers, Remedies
    Cumulative</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">14</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">18.&nbsp;Severability of Provisions</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">14</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">19.&nbsp;Assignment</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">15</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">20.&nbsp;Notices</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">15</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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<P align="right"><FONT size="2">Page (i)
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">21.&nbsp;&nbsp;&nbsp;Authorised Officers</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">16</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">22.&nbsp;&nbsp;&nbsp;Governing Law and
    Jurisdiction</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">16</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">23.&nbsp;&nbsp;&nbsp;Counterparts</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">16</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">Annexure A</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><B><FONT size="2">18</FONT></B></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Drawdown Notice
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="bottom" nowrap><FONT size="2">18</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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<P align="right"><FONT size="2">Page (ii)
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<TR valign="bottom">
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">Date</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="bottom">
    <FONT size="2">1st March 2004
    </FONT></TD>
</TR>

<TR><TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">Parties</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR><TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="bottom">
    <B><FONT size="2">Pan-China Resources
    Ltd</FONT></B><FONT size="2">, a company incorporated under the
    laws of the British Virgin Islands and having an office at 19th
    Floor, 101-6th Avenue, S.W., Calgary, Alberta, Canada T2P 3T4
    (the <B><I>Borrower</I></B>); and
    </FONT></TD>
</TR>

<TR><TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="bottom">
    <B><FONT size="2">Richfirst Holdings
    Limited</FONT></B><I><FONT size="2">,
    </FONT></I><FONT size="2">a company incorporated under the laws
    of the British Virgin Islands and having an office at
    Room&nbsp;2118, Hutchinson House, Harcourt Road, Hong Kong (the
    <B><I>Lender</I></B>).
    </FONT></TD>
</TR>

<TR><TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">Recital</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR><TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="bottom">
    <FONT size="2">The Borrower has requested the Lender to provide
    the Borrower with a facility under which a cash advance of up to
    US$10,000,000 may be made available for the purpose set out in
    clause 2.
    </FONT></TD>
</TR>

</TABLE>
</CENTER>

<P align="left">
<B><FONT size="2">IT IS AGREED </FONT></B><FONT size="2">as
follows.
</FONT>

<P align="left">
<B><FONT size="2">1.&nbsp;&nbsp;&nbsp;Definitions and
Interpretation</FONT></B>

<P align="left">
<B><FONT size="2">1.1&nbsp;Definitions</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Advance </FONT></I></B><FONT size="2">means
    the advance made or to be made under clause 3 or, as applicable,
    so much of it as remains outstanding.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Authorised Officer
    </FONT></I></B><FONT size="2">means:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">in respect of the Borrower, any director or
    secretary, or any person from time to time nominated as an
    Authorised Officer by it by a notice to the Lender accompanied
    by certified copies of signatures of all new persons so
    appointed; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">in respect of the Lender, any director or
    secretary or any person from time to time nominated as an
    Authorised Officer by it by a notice to the Borrower accompanied
    by certified copies of all new persons so approved.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Availability Period
    </FONT></I></B><FONT size="2">means the period commencing on the
    Commencement Date and ending on 120&nbsp;days or, if earlier,
    the date on which the Commitment is fully utilised or is
    cancelled.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Business Day
    </FONT></I></B><FONT size="2">means a weekday, other than a
    Saturday or Sunday, on which the banks in Hong Kong are open to
    the public for the transaction of business.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Closing </FONT></I></B><FONT size="2">has
    the meaning given in the FOA.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 1
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Commencement Date
    </FONT></I></B><FONT size="2">means the date on which all of the
    conditions precedent in clause 13 have been satisfied or waived
    in accordance with this Agreement.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Commitment
    </FONT></I></B><FONT size="2">means US$10,000,000 as reduced or
    cancelled under this Agreement.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Contractor&#146;s Rights and Obligations
    </FONT></I></B><FONT size="2">has the meaning given in the FOA.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Development Costs
    </FONT></I></B><FONT size="2">has the meaning given in the FOA.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Drawdown Date
    </FONT></I></B><FONT size="2">means the date on which the
    Advance under this Agreement is or is to be drawn.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Environment Law
    </FONT></I></B><FONT size="2">means a provision of a law or a
    law which relates to an aspect of planning, the environment,
    heritage, health or safety.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Event of Default
    </FONT></I></B><FONT size="2">means any of the events specified
    in clause 12.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Excluded Tax
    </FONT></I></B><FONT size="2">means a Tax imposed by a
    jurisdiction on the net income of the Lender because the Lender
    has a connection with that jurisdiction but not a Tax:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">calculated by reference to the gross amount of a
    payment under a Transaction Document (without the allowance of a
    deduction); or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">imposed because the Lender is taken to be
    connected with that jurisdiction solely because it is party to a
    Transaction Document or a transaction contemplated by a
    Transaction Document.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Finance Debt
    </FONT></I></B><FONT size="2">means indebtedness (whether actual
    or contingent) in respect of money borrowed or raised or other
    financial accommodation.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">FOA </FONT></I></B><FONT size="2">means the
    Farm-Out Agreement between the Borrower, the Lender, Ivanhoe and
    Sunwing dated 18 January 2004.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Government Agency
    </FONT></I></B><FONT size="2">means any government or any
    governmental, semi-government or judicial entity or authority.
    It also includes any self-regulatory organisation established
    under statute or any stock exchange.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Guarantee
    </FONT></I></B><FONT size="2">means the guarantee between the
    Lender, Ivanhoe and Sunwing on or about the date of this
    Agreement.</FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Ivanhoe </FONT></I></B><FONT size="2">means
    Ivanhoe Energy Inc, a company incorporated under the laws of the
    Territory of the Yukon, Canada and having an office at 999
    Canada Place, Suite&nbsp;654, Vancouver, BC, Canada, V6C 3E1.</FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Kongnan Project
    </FONT></I></B><FONT size="2">has the meaning given in the FOA.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Material Adverse Effect
    </FONT></I></B><FONT size="2">means a material adverse effect on
    the ability of the Borrower to perform its obligations under a
    Transaction Document, on the security of the Lender or on the
    financial condition or business of the Borrower.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Overall Development Program
    </FONT></I></B><FONT size="2">has the meaning given in the FOA.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Participating Interest
    </FONT></I></B><FONT size="2">has the meaning given in the FOA.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Payment </FONT></I></B><FONT size="2">has
    the meaning given in the FOA.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Petroleum Contract
    </FONT></I></B><FONT size="2">has the meaning given in the FOA.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 2
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Repayment Date
    </FONT></I></B><FONT size="2">means July&nbsp;1, 2004 on which
    the Borrower shall repay the Advance and any unpaid interest in
    full in accordance with this Agreement.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Security Interest
    </FONT></I></B><FONT size="2">includes any mortgage, pledge,
    lien or charge or any security or preferential interest or
    arrangement of any kind. It includes:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">anything which gives a creditor priority to other
    creditors with respect to any asset; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">retention of title other than in the ordinary
    course of day-to-day trading and a deposit of money by way of
    security.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Sunwing </FONT></I></B><FONT size="2">means
    Sunwing Energy Ltd, a company incorporated under the laws of
    Bermuda and having an office at 999 Canada Place,
    Suite&nbsp;654, Vancouver, BC, Canada, V6C 3E1.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Tax </FONT></I></B><FONT size="2">includes
    any tax, levy, impost, deduction, charge, rate, duty, compulsory
    loan or withholding which is levied or imposed by a Government
    Agency, and any related interest, penalty, charge, fee or other
    amount.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <B><I><FONT size="2">Transaction
    Documents</FONT></I></B><FONT size="2"><I> means:</I>
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">this Agreement;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Guarantee;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">the FOA;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Petroleum Contract; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">any document which the Lender and the Borrower
    agrees is a Transaction Document.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">1.2&nbsp;Interpretation</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Headings are for convenience only and do not
    affect interpretation. The following rules apply unless the
    context requires otherwise.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">The singular includes the plural, and the
    converse also applies.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">A gender includes all genders.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">Where a word or phrase is defined, its other
    grammatical forms have a corresponding meaning.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to a person, corporation, trust,
    partnership, unincorporated body or other entity includes any of
    them.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(e)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to a clause, annexure or schedule is
    a reference to a clause of, or annexure or schedule to, this
    Agreement.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(f)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to a party to this Agreement or
    another agreement or document includes the party&#146;s
    successors and permitted substitutes or assigns.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(g)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to legislation or to a provisions of
    legislation includes a modification or re-enactment of it, a
    legislative provisions substituted for it and a regulation or
    statutory instrument issued under it.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(h)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to <B><I>writing </I></B>includes a
    facsimile transmission and any means of reproducing words in a
    tangible and permanently visible form.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 3
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to <B><I>conduct </I></B>includes an
    omission, statement or undertaking, whether or not in writing.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(j)</FONT></TD>
    <TD align="left">
    <FONT size="2">The meaning of terms is not limited by specific
    examples introduced by <B><I>including</I></B>, or <B><I>for
    example</I></B>, or similar expressions.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(k)</FONT></TD>
    <TD align="left">
    <FONT size="2">A reference to an <B><I>asset </I></B>includes
    any real or personal, present or future, tangible or intangible
    property or asset (including intellectual property) and any
    right, interest, revenue or benefit in, under or derived from
    the property or asset.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(l)</FONT></TD>
    <TD align="left">
    <FONT size="2">An Event of Default <B><I>subsists </I></B>until
    it has been waived in writing by the Lender.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(m)</FONT></TD>
    <TD align="left">
    <FONT size="2">All references to <B><I>time </I></B>are to Hong
    Kong time.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">2.&nbsp;&nbsp;&nbsp;Purpose</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower shall use the net proceeds of the
    Advance for the Overall Development Program under the Petroleum
    Contract.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">3.&nbsp;&nbsp;&nbsp;Making of
Advance</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">Subject to this Agreement if the Borrower
    requests an advance in a Drawdown Notice, the Lender will make
    available that advance on the Drawdown Date to the account as
    specified in the Drawdown Notice.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">The amount of the Advance must be equal to
    US$10,000,000.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">The Drawdown Date must be a Business Day during
    the Availability Period.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">The Drawdown Notice is irrevocable. It must be
    substantially in the form of Annex A and be received by the
    Lender by 11am 5 Business Days before the proposed Drawdown
    Date. The Borrower may only give one Drawdown Notice.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">4.&nbsp;&nbsp;&nbsp;Interest</FONT></B>

<P align="left">
<B><FONT size="2">4.1&nbsp;Rate</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Interest on the Advance will accrue from day to
    day at the rate of 5.0% per annum.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">4.2&nbsp;Payment of interest</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Subject to clause 7 and except where this
    Agreement provides otherwise, the Borrower will pay accrued
    interest quarterly in arrears. The first interest payment date
    is on the end of the succeeding calendar quarter date from the
    Drawdown Date, and the final interest payment date is on the
    Repayment Date.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">5.&nbsp;Cancellation of Commitment</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">At the close of business on the last day of the
    Availability Period the Commitment will be cancelled
    automatically.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 4
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">6.&nbsp;&nbsp;&nbsp;Repayment</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Subject to clause 7, the Borrower shall repay the
    Advance and any unpaid interest in full on the Repayment Date.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">7.&nbsp;&nbsp;&nbsp;Set-off of Advance against
Payment under FOA</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">The Parties agree that, subject to paragraph
    (d)&nbsp;and notwithstanding clause 4.4 of the FOA, the Lender
    may elect to apply the Advance by way of set-off against the
    Payment.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">If the Lender elects to apply the Advance by way
    of set-off against the Payment and subject to the Advance being
    set-off against the Payment at Closing:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Advance is to be used exclusively by the
    Borrower for Development Costs for the initial development phase
    of the Overall Development Program under the Petroleum Contract,
    including but not limited to drilling, completing and producing
    new wells, producing existing wells, installation of surface
    facilities and development of the water injection scheme for the
    Kongnan Project;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Advance constitutes a Development Cost for
    the purposes of the Petroleum Contract and the Lender is
    entitled to its Participating Interest share of investment
    recovery oil in respect of the Advance on a pro rata basis based
    on the ratio of the Advance to the Payment with effect from the
    date of the Advance and the Borrower must make appropriate
    arrangements for the relevant amount of investment recovery oil
    to be so credited to the account of the Lender; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Borrower is not required to pay the repay the
    Advance or pay interest under this Agreement and as at the date
    of the Closing the Advance and any unpaid interest will be
    deemed to have been repaid by the Borrower to the Lender in full.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">If the Lender elects to apply the Advance by way
    of set-off against the Payment, the Lender&#146;s obligation
    pursuant to clause 4.4 of the FOA will be to pay to the Borrower
    an amount equal to the Payment less the Advance.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">The Lender must give notice of an election
    pursuant to paragraph (a)&nbsp;no less than 3 Business Days
    prior to the date of Closing.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">8.&nbsp;&nbsp;&nbsp;Payments</FONT></B>

<P align="left">
<B><FONT size="2">8.1&nbsp;Manner</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower shall make all payments under this
    Agreement:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">by transfer of immediately available funds to the
    account specified by the Lender by 11am on the due date; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">without set-off, counterclaim or other deduction
    except any compulsory deduction for Tax.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">8.2&nbsp;Payment to be made on Business
Day</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Whenever any payment becomes due on a day which
    is not a Business Day, the due date will be the next Business
    Day in the same calendar month or, if none, the preceding
    Business Day.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 5
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">8.3&nbsp;Appropriation where insufficient
moneys available</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Lender may appropriate amounts it receives as
    among amounts due as it sees fit. This will override any
    appropriation made by the Borrower.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">9.&nbsp;&nbsp;&nbsp;Additional
Payments</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">If the Borrower is obliged to make a deduction in
    respect of Tax from a payment under this Agreement:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>pay deduction</B>) it shall promptly pay the
    amount deducted to the appropriate Government Agency;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>receipt</B>) within 30&nbsp;days of the end
    of the month in which the deduction is made, it shall give the
    Lender the original receipt (or other documents acceptable to
    the Lender) evidencing the payment; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>gross-up</B>) unless the Tax is an Excluded
    Tax, on the due date it shall pay the Lender an additional
    amount so that the Lender receives a net amount (after allowance
    for any further deduction and any Tax on the additional amount)
    equal to the amount it would have received if no deduction had
    been made. It shall indemnify the Lender against the Tax and any
    amounts recoverable from the Lender in respect of the Tax.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">It waives any statutory or other right to recover
    from the Lender any amount paid under this clause.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">10.&nbsp;Representations and
Warranties</FONT></B>

<P align="left">
<B><FONT size="2">10.1&nbsp;Representations and
warranties</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower makes the following representations
    and warranties.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Status</B>) It is a corporation validly
    existing under the laws of the place of its incorporation
    specified in this Agreement.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Power</B>) It has the power to enter into and
    perform its obligations under the Transaction Documents to which
    it is expressed to be a party, to carry out the transactions
    contemplated by those documents and to carry on its business as
    now conducted or contemplated.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Corporate authorisations</B>) It has taken
    all necessary corporate action to authorise the entry into and
    performance of the Transaction Documents to which it is
    expressed to be a party, and to carry out the transactions
    contemplated by those documents.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Documents binding</B>) Each Transaction
    Document to which it is expressed to be a party is its valid and
    binding obligation enforceable in accordance with its terms,
    subject to any necessary stamping and registration.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(e)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Transactions permitted</B>) The execution and
    performance by it of the Transaction Documents to which it is
    expressed to be a party and each transaction contemplated under
    those documents did not and will not violate in any respect a
    provision of:
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 6
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">a law or treaty or a judgment, ruling, order or
    decree of a Government Agency binding on it;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">its constitution or other constituent documents;
    or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">any other document or agreement which is binding
    on it or its assets,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">and, except as provided by the Transaction
    Documents, did not and will not:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iv)</FONT></TD>
    <TD align="left">
    <FONT size="2">create or impose a Security Interest on any of
    its assets; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(v)</FONT></TD>
    <TD align="left">
    <FONT size="2">allow a person to accelerate or cancel an
    obligation with respect to Finance Debt, or constitute an event
    of default, cancellation event, prepayment event or similar
    event (whatever called) under an agreement relating to Finance
    Debt, whether immediately or after notice or lapse of time or
    both.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(f)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>No litigation</B>) No litigation,
    arbitration, Tax claim, dispute or administrative or other
    proceeding is current or pending or, to its knowledge,
    threatened, which may have a Material Adverse Effect.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(g)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>No default</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">It is not in default under a document or
    agreement (including an Authorisation) binding on it or its
    assets which relates to Finance Debt or is material.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">Nothing has occurred which constitutes an event
    of default, cancellation event, prepayment event or similar
    event (whatever called) under those documents or agreements,
    whether immediately or after notice or lapse of time or both.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(h)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Authorisations</B>) Each Authorisation which
    is required in relation to:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">the execution, delivery and performance by it of
    the Transaction Documents to which it is expressed to be a party
    and the transactions contemplated by those documents;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">the validity and enforceability of those
    documents; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">its business as now conducted or contemplated and
    which is material (including under Environmental Law),
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">has been obtained or effected. Each is in full
    force and effect. It has complied with each of them. It has paid
    all applicable fees for each of them.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>No misrepresentation</B>) All information
    provided by it to the Lender is true in all material respects at
    the date of this Agreement or, if later, when provided. Neither
    that information nor its conduct and the conduct of anyone on
    its behalf in relation to the transactions contemplated by the
    Transaction Documents, was or is misleading, by omission or
    otherwise.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(j)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Agreements disclosed</B>) Each document or
    agreement which is material to the Transaction Documents or
    which has the effect of varying a Transaction Document has been
    disclosed to the Lender in writing.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(k)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Copies of documents</B>) All copies of
    documents (including its latest audited accounts and all
    Authorisations) given by it or on its behalf to the Lender are
    true and complete copies. Those documents are in full force and
    effect.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 7
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(l)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Title</B>) It is the legal and beneficial
    owner of 100% of the Contractor&#146;s Rights and Obligations
    free of any Security Interest.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(m)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Law</B>) It has complied with all laws
    binding on it where breach may have a Material Adverse Effect.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(n)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Environmental Law</B>) No act or omission has
    occurred and there is no circumstance relating to its assets or
    its business which has given rise or may give rise to:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">a substantial claim against it;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a requirement of substantial expenditure by it; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a requirement that it ceases or substantially
    alters an activity,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">under Environmental Law.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Without limitation none of its assets is
    contaminated, all assets are within applicable environmental
    standards and all emissions and discharges are within standards
    or limits imposed by all relevant laws and Authorisations.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">10.2&nbsp;Reliance on representations and
warranties</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower acknowledges that the Lender has
    entered the Transaction Documents in reliance on the
    representations and warranties in this clause.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">11.&nbsp;Undertakings</FONT></B>

<P align="left">
<B><FONT size="2">11.1&nbsp;General undertakings</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower undertakes to the Lender as follows,
    except to the extent that the Lender consents.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Authorisations</B>) It will ensure that each
    Authorisation required for:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">the execution, delivery and performance by it of
    the Transaction Documents to which it is expressed to be a party
    and the transactions contemplated by those documents;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">the validity and enforceability of those
    documents; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">the carrying on by it of its business as now
    conducted or contemplated,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">is obtained and promptly renewed and maintained
    in full force and effect. It will pay all applicable fees for
    them. It will provide copies promptly to the Lender when they
    are obtained or renewed.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Notice to Lender</B>) It will notify the
    Lender as soon as it becomes aware of:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">any Event of Default;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">any proposal by a Government Agency to acquire
    compulsorily the whole or a substantial part of its assets or
    business;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">any substantial dispute between it and a
    Government Agency; and
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 8
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Disposal of assets</B>) It will not sell or
    otherwise dispose of, part with possession of, or create an
    interest in all or a substantial part of its assets or agree or
    attempt to do so (whether in one or more related or unrelated
    transactions) except:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">disposals of assets in exchange for other assets
    comparable in value; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">disposals in the ordinary course of day-to-day
    trading at arm&#146;s length.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Negative pledge</B>) It will not create or
    allow to exist a Security Interest over its assets other than a
    lien arising by operation of law in the ordinary course of
    day-to-day trading and not securing Finance Debt where it duly
    pays the indebtedness secured by that lien other than
    indebtedness contested in good faith.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(e)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Corporate existence</B>) It will do
    everything necessary to maintain its corporate existence in good
    standing. It will not transfer its jurisdiction of incorporation
    or enter any merger or consolidation.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(f)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Compliance with law</B>) It will comply fully
    with all laws binding on it.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(g)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Compliance and enforcement of Transaction
    Documents</B>) It will:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">comply fully with its obligations under the
    Transaction Documents;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">enforce each Transaction Document to which it is
    a party and exercise its rights, authorities and discretions
    under those documents in accordance with the directions (if any)
    of the Lender; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">use its best endeavours to keep the Transaction
    Documents valid and enforceable.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(h)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Variation of Transaction Documents</B>)
    Without prior consent of the Lender, it will not:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">amend or vary, or consent to any amendment or
    variation of;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">avoid, release, surrender, terminate, rescind,
    discharge (other than by performance) or accept the repudiation
    of;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">expressly or impliedly waive, or extend or grant
    any time or indulgence in respect of, any provision of or
    obligation under; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iv)</FONT></TD>
    <TD align="left">
    <FONT size="2">do or permit anything which would enable or give
    grounds to another party to do anything referred to in
    sub-paragraphs (i), (ii)&nbsp;or (iii)&nbsp;in relation to,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">a Transaction Document.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Change of business</B>) It will not cease or
    materially change its business. It will not take action whether
    by acquisition or otherwise which alone or together would
    materially alter the nature of the business.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">11.2&nbsp;Term of undertakings</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Each undertaking in this clause continues from
    the date of this Agreement until all the amounts outstanding
    under this Agreement are fully and finally paid.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 9
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">12.&nbsp;Events of Default</FONT></B>

<P align="left">
<B><FONT size="2">12.1&nbsp;Events of Default</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Each of the following is an Event of Default:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Obligations under Transaction Documents</B>)
    The Borrower fails:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">to pay an amount payable by it under a
    Transaction Document when due;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">to comply with any of its other obligations under
    a Transaction Document and, if in the opinion of the Lender that
    failure can be remedied within 14&nbsp;days, does not remedy the
    failure within that period; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">to satisfy within the time stipulated anything
    which the Lender made a condition of its waiving compliance with
    a condition precedent or undertaking in a Transaction Document.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Misrepresentation</B>) A representation,
    warranty or statement by or on behalf of the Borrower in a
    Transaction Document, or in a document provided under or in
    connection with a Transaction Document, is not true in a
    material respect or is misleading when made or repeated.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Cross default</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">Finance Debt of the Borrower totalling at least
    US$5&nbsp;million or its equivalent:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="11%"></TD>
    <TD width="4%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(A)</FONT></TD>
    <TD align="left">
    <FONT size="2">is not paid when due (or within an applicable
    grace period); or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(B)</FONT></TD>
    <TD align="left">
    <FONT size="2">becomes due and payable or capable of being
    declared due and payable before its stated maturity or expiry; or
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a facility or obligation granted or owed by a
    person to the Borrower to provide financial accommodation or to
    acquire or underwrite Finance Debt totalling at least US$5
    million or its equivalent is prematurely terminated; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">an event of default as defined in another
    Transaction Document occurs.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Administration, winding up, arrangements,
    insolvency etc</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">An administrator of the Borrower is appointed.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">Except for the purpose of a solvent
    reconstruction or amalgamation previously approved by the Lender:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="11%"></TD>
    <TD width="4%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(A)</FONT></TD>
    <TD align="left">
    <FONT size="2">an application or an order is made, proceedings
    are commenced, a resolution is passed or proposed in a notice of
    meeting, an application to a court or other steps are taken for:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="15%"></TD>
    <TD width="4%"></TD>
    <TD width="81%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(1)</FONT></TD>
    <TD align="left">
    <FONT size="2">the winding up, dissolution or administration of
    the Borrower; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(2)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Borrower entering into an arrangement,
    compromise or composition with or assignment for the benefit of
    its creditors or a class of them,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="15%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">(other than frivolous or vesatious applications,
    proceedings, notices and steps); or
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 10
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="11%"></TD>
    <TD width="4%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(B)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Borrower ceases, suspends or threatens to
    cease or suspend the conduct of all or a substantial part of its
    business or disposes of or threatens to dispose of a substantial
    part of its assets.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">The Borrower:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="11%"></TD>
    <TD width="4%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(A)</FONT></TD>
    <TD align="left">
    <FONT size="2">is, or under legislation is presumed or taken to
    be, insolvent (other than as the result of a failure to pay a
    debt or claim the subject of a good faith dispute); or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(B)</FONT></TD>
    <TD align="left">
    <FONT size="2">stops or suspends or threatens to stop or suspend
    payment of all or a class of its debts.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(e)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Enforcement against assets</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">A receiver, receiver and manager, administrative
    receiver or similar officer is appointed to;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a Security Interest becomes enforceable or is
    enforced over; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a distress, attachment or other execution is
    levied or enforced or applied for over,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">all or any of the assets and undertaking of the
    Borrower.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(f)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Reduction of capital</B>) Without the prior
    consent of the Lender, the Borrower:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">reduces its capital (including a purchase of its
    shares but excluding a redemption of redeemable shares);
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">passes a resolution to reduce its capital or to
    authorise it to purchase its shares or calls a meeting to
    consider such a resolution; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">applies to a court to call any such meeting or to
    sanction any such resolution or reduction.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(g)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Vitiation of documents</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">All or any part of a Transaction Document is
    terminated or is or becomes void, illegal, invalid,
    unenforceable or of limited force and effect;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a party becomes entitled to terminate, rescind or
    avoid all or part of a Transaction Document; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a party other than the Lender alleges or claims
    that an event described in sub-paragraph (i)&nbsp;has occurred
    or that it is entitled as described in sub-paragraph (ii).
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(h)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Amendment of constitution</B>) The
    constitution or other constituent documents of the Borrower are
    amended in a material respect without the prior consent of the
    Lender (which will not be withheld unreasonably).
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Revocation of Authorisation</B>) An
    Authorisation which is material to the performance by the
    Borrower of a Transaction Document, or to the validity and
    enforceability of a Transaction Document or to the security of
    the Lender, is repealed, revoked or terminated or expires, or is
    modified or amended or conditions are attached to it in a manner
    unacceptable to the Lender, and is not replaced by another
    Authorisation acceptable to the Lender.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 11
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(j)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Material adverse change</B>) Any other event
    or series of events, whether related or not, occurs (including a
    material adverse change in the business, assets or financial
    condition of the Borrower, which in the reasonable opinion of
    the Lender may have a Material Adverse Effect.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(k)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Control of Borrower and Guarantors</B>)
    Without the prior consent of the Lender in the opinion of the
    Lender there is a material change in the ownership, management
    or control of the Borrower or a Guarantor.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(l)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Compulsory acquisition</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">All or any substantial part of the assets of the
    Borrower is compulsorily acquired by or by order of a Government
    Agency or under law;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a Government Agency orders the sale, vesting or
    divesting of all or any substantial part of the assets of the
    Borrower; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a Government Agency takes a step for the purpose
    of any of the above or proposes or threatens to do any of the
    above.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(m)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Governmental interference</B>) A law or
    anything done by a Government Agency wholly or partially to a
    material extent renders illegal, prevents or restricts the
    performance or effectiveness of a Transaction Document or
    otherwise has a Material Adverse Effect.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(n)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Environmental event</B>)
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="8%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)</FONT></TD>
    <TD align="left">
    <FONT size="2">Any person takes action;
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="11%"></TD>
    <TD width="4%"></TD>
    <TD width="85%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(B)</FONT></TD>
    <TD align="left">
    <FONT size="2">there is a claim; or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(C)</FONT></TD>
    <TD align="left">
    <FONT size="2">there is a requirement of expenditure or of
    cessation or alteration of activity,
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="11%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">under Environmental Law, which in the opinion of
    the Lender may have a Material Adverse Effect; or
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">a circumstance arises which in the reasonable
    opinion of the Lender may give rise to an action, claim or
    requirement within sub-paragraph (i).
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">12.2&nbsp;Consequences</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">In addition to any other rights provided by law
    or any Transaction Document, at any time after an Event of
    Default (whether or not it is continuing) the Lender may do all
    or any of the following:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">by notice to the Borrower declare all sums
    actually or contingently owing under this Agreement immediately
    due and payable, and the Borrower shall immediately pay the
    Advance together with accrued interest and fees and all other
    sums;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">by notice to the Borrower cancel the Commitment.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 12
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">13.&nbsp;Conditions Precedent</FONT></B>

<P align="left">
<B><FONT size="2">13.1&nbsp;Conditions precedent to Drawdown
Notice</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The right of the Borrower to give the Drawdown
    Notice and the obligations of the Lender under this Agreement
    are subject to the conditions precedent that the Lender has
    received all of the following in form and substance satisfactory
    to the Lender:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>transaction documents</B>) duly executed
    counterparts of this Agreement and the Guarantee
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">13.2&nbsp;Conditions precedent to
Advance</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The obligation of the Lender to make available
    the Advance is subject to the further conditions precedent that:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>representations true</B>) the representations
    and warranties by the Borrower in clause 10 are true as at the
    date of the relevant Drawdown Notice and the Drawdown Date as
    though they had been made at that date in respect of the facts
    and circumstances then subsisting; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>no default</B>) no Event of Default or
    anything which with the giving of notice or passage of time or
    both would become an Event of Default is subsisting at the date
    of the Drawdown Notice or Drawdown Date or will result from the
    provision of the Advance.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">14.&nbsp;Interest on Overdue Amounts</FONT></B>

<P align="left">
<B><FONT size="2">14.1&nbsp;Accrual and payment</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Accrual</B>) Interest accrues on each unpaid
    amount which is due and payable by the Borrower under or in
    respect of this Agreement (including interest under this clause):
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">on a daily basis up to the date of actual payment
    from (and including) the due date or, in the case of an amount
    payable by way of reimbursement or indemnity, the date of
    disbursement or loss, if earlier;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">both before and after judgment (as a separate and
    independent obligation); and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">at the rate of 5.0% per annum (<B>Rate</B>),
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">except where this Agreement provides otherwise.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">(<B>Payment</B>) The Borrower shall pay interest
    accrued under this clause on demand. That interest is payable in
    the currency of the unpaid amount on which it accrues unless the
    Lender agrees other wise.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">15.&nbsp;Indemnities</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower shall indemnify the Lender on demand
    against any loss, cost, liability or expense (including legal
    costs on a full indemnity basis) which the Lender (or any
    officer or employee of the Lender) incurs as a result of or in
    connection with:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">any Event of Default;
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 13
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">any exercise or attempted exercise of any right,
    power or remedy under this Agreement or any failure to exercise
    any right, power or remedy;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Advance not being provided for any reason
    (including failure to fulfil a condition precedent but excluding
    default by the Lender); or
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(d)</FONT></TD>
    <TD align="left">
    <FONT size="2">the Lender receiving payments of principal before
    the Repayment Date for any reason, including prepayment in
    accordance with this Agreement.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">16.&nbsp;Expenses</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower shall reimburse the Lender on demand
    for its expenses in relation to:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">the preparation, execution and completion of the
    Transaction Documents and any subsequent consent, agreement,
    approval, waiver or amendment; and
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="8%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">any actual or contemplated enforcement of the
    Transaction Documents, or the actual or contemplated exercise,
    preservation or consideration of any rights, powers or remedies
    under the Transaction Documents; and
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">any enquiry by a Government Agency concerning the
    Borrower or a transaction or activity the subject of the
    Transaction Documents or in connection with which, financial
    accommodation or funds raised under a Transaction Document are
    used or provided.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">This includes legal costs and expenses (including
    in-house lawyers charged at their usual rates) on a full
    indemnity basis, expenses incurred in retaining consultants to
    evaluate matters of material concern to the Lender and
    administrative costs including time of its executives (whose
    time and costs are to be charged at reasonable rates).
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">17.&nbsp;Waivers, Remedies
Cumulative</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">No failure to exercise and no delay in exercising
    any right, power or remedy under this Agreement operates as a
    waiver. Nor does any single or partial exercise of any right,
    power or remedy preclude any other or further exercise of that
    or any other right, power or remedy.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">The rights, powers and remedies provided to the
    Lender in this Agreement are in addition to, and do not exclude
    or limit, any right, power or remedy provided by law.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">18.&nbsp;Severability of Provisions</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Any provision of this Agreement which is
    prohibited or unenforceable in any jurisdiction is ineffective
    as to that jurisdiction to the extent of the prohibition or
    unenforceability. That does not invalidate the remaining
    provisions of this Agreement nor affect the validity or
    enforceability of that provision in any other jurisdiction.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 14
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">19.&nbsp;Assignment</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">No party may assign or transfer any of its rights
    or obligations under this Agreement without the prior written
    consent of the other party.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">20.&nbsp;Notices</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Notices, demands or other communications
    (<B><I>Communication</I></B>) required or permitted to be given
    or made under this Agreement:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">shall be in writing and delivered personally or
    sent by prepaid first class post with recorded delivery, e-mail,
    or by legible telefax addressed to the intended recipient as
    follows:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">in the case of Lender addressed to:
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Richfirst Holdings Limited <BR>
     c/o China International Trust &#38; Investment Corporation <BR>
     Rm 611, Capital Mansion <BR>
     #6 Xinyuan Nanlu, Chaoyang District <BR>
     Beijing, P.R.China 100004 <BR>
     Fax No.: +86-10-8486-3105 <BR>
     Attention: Mr.&nbsp;Hu Yuqing, General Planning Department
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">in the case of Borrower addressed to:
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Pan-China Resources Ltd <BR>
     19th Floor, 101 &#150; 6th Avenue S.W. <BR>
     Calgary, Alberta, Canada T2P 3P4 <BR>
     Fax No.: +1-403-266-3772 <BR>
     Attention: President; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">Ivanhoe Energy Inc. <BR>
     Suite&nbsp;654, 999 Canada Place <BR>
     Vancouver, BC, Canada V6C 3E1 <BR>
     Fax No.: +1-604-604-688-7168 <BR>
     Attention: CFO
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="4%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">be signed by a person duly authorised by the
    sender; and
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(c)</FONT></TD>
    <TD align="left">
    <FONT size="2">will be taken to have been given or made:
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(i)</FONT></TD>
    <TD align="left">
    <FONT size="2">in the case of delivery in person, when delivered;
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(ii)</FONT></TD>
    <TD align="left">
    <FONT size="2">in the case of facsimile transmission, on receipt
    by the sender of a transmission control report from the
    despatching machine showing the relevant number of pages and the
    correct destination fax number and indicating that the
    transmission has been made without error; or
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 15
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(iii)</FONT></TD>
    <TD align="left">
    <FONT size="2">in the case of deliver by post, 7 Business Days
    after the date of posting (if posted to an address in another
    country) or 2 Business Days after the date of posting (if posted
    to an address in the same country),
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="93%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">but if the result is that the Communication would
    be taken to be given or made on a day which is not a Business
    Day in the place to which the Communication is sent or is later
    than 4pm (local time), it will be taken to have been duly given
    or made at the commencement of business on the next Business Day
    in that place.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">21.&nbsp;Authorised Officers</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">The Borrower irrevocably authorises the Lender to
    rely on a certificate by a person purporting to be its director
    or secretary as to the identity and signatures of its Authorised
    Officers. The Borrower warrants that those persons have been
    authorised to give notices and communications under or relating
    to this Agreement.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">22.&nbsp;Governing Law and
Jurisdiction</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">This Agreement is governed by the laws of Hong
    Kong. The Borrower submits to the non-exclusive jurisdiction of
    courts exercising jurisdiction there.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<B><FONT size="2">23.&nbsp;Counterparts</FONT></B>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <FONT size="2">This Agreement may be executed in any number of
    counterparts. All counterparts together will be taken to
    constitute one instrument.
    </FONT></TD>
</TR>

</TABLE>

<P align="right"><FONT size="2">Page 16
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">EXECUTED </FONT></B><FONT size="2">in Beijing,
People&#146;s Republic of China.
</FONT>

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0">

<TR>
    <TD width="47%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="6%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="47%"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <B><FONT size="2">RICHFIRST HOLDINGS LIMITED</FONT></B></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <B><FONT size="2">PAN-CHINA RESOURCES LTD.</FONT></B></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <I><FONT size="2">&nbsp;<BR>&nbsp;<BR>&#147;Zhang Jijing&#148;</FONT></I></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <I><FONT size="2">&nbsp;<BR>&nbsp;<BR>&#147;Patrick Chua&#148;</FONT></I></TD>
</TR>

<TR>
    <TD align="left"><HR size="1" noshade></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left"><HR size="1" noshade></TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Authorised Signatory
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <FONT size="2">Authorised Signatory
    </FONT></TD>
</TR>

</TABLE>
</CENTER>

<P align="right"><FONT size="2">Page 17
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left">
<FONT size="5">Loan Agreement
</FONT>
</DIV>

<P align="left">
<B><FONT size="2">Annexure A</FONT></B>

<P align="left">
<B><FONT size="2">Drawdown Notice</FONT></B>

<P align="left">
<FONT size="2">This is an irrevocable notice under clause 3 of
the Loan Agreement dated March 1st, 2004 (the <B><I>Loan
Agreement</I></B>).
</FONT>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><FONT size="2">(1)</FONT></TD>
    <TD align="left">
    <FONT size="2">We wish to draw on March 1st, 2004 (the
    <B><I>Drawdown Date</I></B>).
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD><FONT size="2">(2)</FONT></TD>
    <TD align="left">
    <FONT size="2">The total principal amount to be drawn is
    US$10,000,000.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD><FONT size="2">(3)</FONT></TD>
    <TD align="left">
    <FONT size="2">Please remit the proceeds to account number
    </FONT></TD>
</TR>

</TABLE>

<CENTER>
<TABLE width="92%" align="center" cellspacing="0" cellpadding="0" border="0">

<TR>
    <TD width="15%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="5%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="80%"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Beneficiary:
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <FONT size="2">Ivanhoe Energy Inc.
    </FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Beneficiary bank:
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <FONT size="2">Bank of Montreal, 595 Burrard Street,
    <B>Vancouver, B.C., Canada</B>
    </FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Account Number:
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <FONT size="2">4653&nbsp;&#150; 643
    </FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Branch No.:
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <FONT size="2">001
    </FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left:10px; text-indent:-10px">
    <FONT size="2">Transit No.:
    </FONT></DIV>
    </TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top">
    <FONT size="2">0004
    </FONT></TD>
</TR>

</TABLE>
</CENTER>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><FONT size="2">(4)</FONT></TD>
    <TD align="left">
    <FONT size="2">We represent and warrant as follows.
    </FONT></TD>
</TR>

</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="4%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(a)</FONT></TD>
    <TD align="left">
    <FONT size="2">The representations and warranties in the Loan
    Agreement are true as though they had been made at the date of
    this Drawdown Notice and the Drawdown Date specified above in
    respect of the facts and circumstances then subsisting.
    </FONT></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD><FONT size="2">(b)</FONT></TD>
    <TD align="left">
    <FONT size="2">No Event of Default or anything which with the
    giving of notice or passage of time or both would become an
    Event of Default subsists or will result from the drawing.
    </FONT></TD>
</TR>

</TABLE>

<P align="left">
<FONT size="2">Definitions in the Loan Agreement apply in this
Drawdown Notice.
</FONT>

<P align="left">
<FONT size="2">On behalf of Pan-China Resources Ltd
</FONT>

<P align="left">
<FONT size="2">By:
</FONT>

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


<P align="left">
<B><FONT size="2">DATED March 1st, 2004</FONT></B>

<P align="right"><FONT size="2">Page 18
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