WARRANT AMENDMENT AGREEMENT

     This  Warrant Amendment Agreement dated as of July 16,  1999
by  and  between  XCL Ltd., a Delaware corporation  ("XCL"),  and
Mitch Leigh (the "Warrantholder").

                      W I T N E S S E T H:

     WHEREAS, the Warrantholder holds 43,410 warrants to purchase
shares  of common stock, par value $0.01 per share, of XCL having
been  originally issued pursuant to Warrant Certificate No.  LM-9
dated May 21, 1999 and reflecting an exercise price of $1.25  per
share of common stock (subject to adjustment as therein provided)
(the "Warrant Certificate"); and

     WHEREAS,  the Warrantholder acquired the Warrant Certificate
in connection with his purchase of one Unit in a private offering
by  XCL Land Ltd., a wholly owned subsidiary of XCL and XCL Ltd.,
to a limited number of qualified investors of up to 62 Units each
Unit  consisting of $100,000 in principal amount of a  promissory
note  of  XCL  Land (collectively the "Notes" and individually  a
"Note") and 21,705 Warrants (the "Warrants"); and

     WHEREAS,  the Subscription Agreement pursuant to  which  the
Warrantholder  subscribed for the Unit referenced above  provides
that until the Warrantholder's Note is paid in full, if the terms
of  the Units (including the Notes and the Warrants) are amended,
no  amendment shall be effective until it is offered to the other
Unit owners and either accepted or rejected by them; and

     WHEREAS,  in  order  to  induce two of  the  Unitholders  to
purchase  an  undivided  interest in  certain  notes  held  by  a
subsidiary of XCL, XCL agreed to reduce the exercise price of the
Warrants held by those Unitholders from $1.25 to $0.10 per  share
of common stock (subject to adjustment as therein provided); and

     WHEREAS,   pursuant  to  his  Subscription  Agreement,   the
Warrantholder was offered the same amendment and accepted it.

     NOW,  THEREFORE, in consideration of the premises and  other
good  and valuable consideration, the receipt and sufficiency  of
which  are hereby acknowledged and confirmed, the parties  hereto
hereby agree as follows:

     1.      The  definition of "Initial Exercise Price"  in  the
first  paragraph of the Warrant Certificate is hereby amended  to
read as follows:

                    "...  at the initial exercise price
          of   U.S.   $0.10  per  share  (the  "Initial
          Exercise Price") ..."
          _

All  other  terms  and provisions of the first paragraph  of  the
Warrant Certificate shall remain unchanged.

     2.     This Warrant Amendment Agreement shall not constitute
a  waiver  or  amendment of any other provision  of  the  Warrant
Certificate  not  expressly referred  to  herein  and  except  as
expressly   amended  hereby,  the  provisions  of   the   Warrant
Certificate are and shall remain in full force and effect.

     3.      Upon  surrender of the original Warrant Certificate,
XCL  shall issue a new Warrant Certificate of like tenor  and  an
equivalent number of Warrants to the Warrantholder reflecting the
amendment set forth in paragraph 1 above.

     4.      This  Warrant  Amendment Agreement  sets  forth  the
entire  understanding of the parties hereto with respect  to  the
subject mater hereof and may be executed in counterparts, each of
which when executed shall be deemed to be an original but all  of
which taken together shall constitute one and the same agreement.

     5.     This Warrant Amendment Agreement shall be governed by
and  construed in accordance with the internal laws of the  State
of Delaware without regard to conflicts of laws.

     IN  WITNESS  WHEREOF, the parties hereto  have  caused  this
Warrant Amendment Agreement to be duly executed and delivered  as
of the date and year first above written.

                              XCL LTD.


                              By:______________________________
                              Name:____________________________
                              Title:_____________________________


                              WARRANTHOLDER:


                              _________________________________
                              Mitch Leigh