[LETTERHEAD]





                               December 18, 1998


Mr. Joe U. Flores
Mobil Exploration & Production U.S. Inc.
1200 Timberlock Place
The Woodlands, Texas   77380


RE:     Assignment of Contract Rights and Term Assignment
        of Oil and Gas Lease, Old Ocean Area, Brazoria and
        Matagorda Counties, Texas

Ladies and Gentlemen:

        The purpose of this letter is to set forth our agreement  regarding
the extension of that certain letter agreement (the "Agreement") dated
November 10, 1998 between Benz Energy, Ltd.  ("Benz") and Mobil Producing
Texas & New Mexico Inc. ("Mobil")  regarding the referenced transaction (the
"Transaction").

1.      The Agreement provides the closing of the Transaction  will occur on
or before December 15, 1998.  At the request of  Benz Mobil hereby agrees to
extend the closing of the Transaction to on or before December 31, 1998 (the
"Closing Date").

2.      The Agreement also requires the parties to negotiate in  good faith
to formalize a purchase and sale agreement.  The  parties hereby agree that
they are under no obligation to  negotiate, for or formalize such an
agreement.

3.      In the event Benz is unable to close this Transaction on  or before
the Closing Date, as liquidating damages, Mobil will  receive an assignment
from Benz of 22.23105% of 8/8ths interest  in all of the geophysical option
agreements and oil, gas and  mineral leases and any extensions, renewals or
modifications  thereto, (the "Interest") acquired by, or for the benefit of,
Benz or any of its affiliated companies free of cost through the  Closing
Date. The Interest assigned will be limited to lands  within the AMI but
outside the Old Ocean Unit as identified in  that unrecorded agreement, by
and between Mobil Producing Texas &  New Mexico Inc., Amoco Producing Company
and Cheyenne Petroleum  Company dated effective October 15, 1997.



Mobil Exploration & Production U.S. Inc.
December 18, 1998
Page 2


        If this letter set forth your understanding, please sign  and insert
the date in the appropriate spaces below.

Very truly yours,

BENZ ENERGY, LTD.

/s/ R. Hiram Lucius
R. Hiram Lucius, CPL
Coordinator Contract Negotiations


ACCEPTED AND AGREED TO
this 18th day of December, 1998:


MOBIL PRODUCING TEXAS & NEW MEXICO INC.

By:   Mobil Exploration & Producing U.S. Inc.,
      as Agent

      /s/ Joe U. Flores
      -----------------------------------------
      BY: Joe U. Flores
          -------------------------------------
      NAME:
            -----------------------------------
      TITLE: Landman
             ----------------------------------