July 14, 1996

Board of Directors
Midland Resources, Inc.
16701 Greenspoint Park Drive, Suite 200
Houston, TX 77060

Gentlemen:

You have asked Southwest Merchant Group to express an opinion from a financial
point of view of the fairness of the price paid to purchase of all of the common
stock of Summit Petroleum, Inc. by Midland Resources, Inc.

Southwest Merchant Group is an investment banking and management consulting firm
located in Dallas, Texas. As an element of our business activities, we value 
the shares and assets of both publicly held businesses for a number of
reasons, including mergers, acquisitions, public offerings, employee stock
ownership plans, valuation for estate tax purposes, etc. Information pertaining
to the experience of the principals of Southwest Merchant Group is attached.

In arriving at our opinion, we reviewed such documents (including various Summit
Petroleum, Inc. filings with the Securities and Exchange Commission), considered
such questions, and conducted such analysis as we deemed appropriate. Also, we
visited the common headquarters facilities of Summmit Petroleum, Inc. and
Midland Resources, Inc. and discussed the operations of the business, including
future prospects and potential problem areas with various management personnel.

In addition to reviewing documents and visiting the management offices, in
reaching our opinion we considered the nature and history of the business of
Summit Petroleum, Inc., the economic outlook for the economy in general, and for
the oil and gas exploration industry in particular. We also considered the
financial condition of Summit Petroleum, Inc., its oil and gas reserves, cash
flows derived from operation of wells, tax loss carryforward, as well as the
earnings and cash flow history and our estimate of the company's potential.

No limitations were placed on our investigation, and we were given full access
to all material requested on a timely basis. However, we have relied upon and
assumed the accuracy and completeness of the financial and other data provided
to us, particularly the audited and unaudited financial statements, and
estimates of oil and gas reserves of Summit Petroleum, Inc. prepared by the
company. We have not attempted independent verification of such data.

Based on our analysis of the factors deemed relevant, it is our opinion that the
proposed 



purchase of all of the common shares of a Summit Petroleum, Inc. by
Midland Resources, Inc., at a cash price of $0.70 per share, and the purchase of
option shares at a price of $0.70 per share, less the exercise price thereof, is
fair from a financial point of view to the shareholders of Midland Resources,
Inc.

Sincerely,

Southwest Merchant Group
5735 Pineland Drive, Suite 215
Dallas, Texas 75231

/s/Michael D. Riggs

Michael D. Riggs
Managing Director