EXHIBIT 99.2

                               TPG PARTNERS, L.P.
                              TPG PARALLEL I, L.P.
                                 201 Main Street
                                   Suite 2420
                             Fort Worth, Texas 76102

                                  March 1, 1999


Denbury Resources Inc.
17204 Preston Road
Suite 200
Dallas, Texas 75252

         RE: Termination of Securities Purchase Agreement

Ladies and Gentlemen:

         Reference is  made to  the Securities  Purchase Agreement, dated  as of
November 13, 1995 between TPG  Partners,  L.P.  and Denbury  Resources  Inc. (as
successor  in  interest  to Newscope  Resources  Ltd.),  as amended by the First
Amendment to Securities Purchase Agreement,  dated as of December 21, 1995 among
TPG  Partners,  L.P.,  TPG  Parallel I, L.P.  and  Denbury  Resources  Inc.  (as
successor in interest to Newscope Resources Ltd.) (such agreement as so amended,
the "Securities Purchase Agreement").

         This letter confirms our understanding and agreement that, effective as
of the closing under the Stock Purchase  Agreement dated as of December 16, 1998
between  Denbury  Resources  Inc.  and TPG Partners  II,  L.P.,  the  Securities
Purchase Agreement shall terminate and cease to have any force or effect. Please
acknowledge   your   confirmation  of  this   understanding   and  agreement  by
countersigning  and  returning  to us the  enclosed  copy of this  letter  where
indicated below.

                                Very truly yours,

                                TPG PARTNERS, L.P.
                                By:  TPG GenPar, L.P., its general partner
                                     By: TPG Advisors, Inc., its general partner

                                     By: ___________________________________
                                         Name:  William S. Price, III
                                         Title:   Vice President

                                TPG PARALLEL II, L.P.
                                By:  TPG GenPar, L.P., its general partner
                                     By: TPG Advisors, Inc., its general partner

                                     By: ___________________________________
                                         Name:  William S. Price, III
                                         Title:   Vice President


Confirmed and agreed:

DENBURY RESOURCES, INC.

By:__________________________________
Name:  Phil Rykoek
Title: Chief Financial Officer