His Excellency Drs. L.A.E. Alibux

Ministry of Natural Resources

Mirandastraat 11-13

Paramaribo, Suriname *** BY FAX: 011-597-472-911***

 Dear Mr. Minister:

 RE: OIL EXPLORATION INVESTMENT OPPORTUNITIES IN SURINAME

Thank you for seeing me and U.S. Ambassador Dennis Hays in your offices on Friday, September 4,1998. 1 was most appreciative of the opportunity to provide you and Chairman Tjon Kie Sim with an update on my team's meetings with our counterparts at Staatsolie. I am also grateful for the cordiality and professionalism which you and your immediate staff have always shown to Koch. I continue to believe that excellent potential exists for Koch to become a strategic partner of Staatsolie, Suriname and its people in future exploration for new oil fields.

As you know, we were happy to report that Staatsolie's employees were very cooperative in providing us assistance and copies of important data and reports. In particular, Mr. Eddy Jharap ensured a smooth and professional information gathering process for Koch.

During Koch's three visits to Suriname in 1998, we have been impressed with Staatsolie. The technical knowledge of Staatsolie's employees, the application of technology in the company's oil operations and the company's digital database are all important features of Staatsolie's capabilities. We found that Staatsolie's staff asked many questions regarding Koch's oil operations in Canada to determine if Koch's techniques could be applied by Staatsolie in Suriname. The willingness of Staatsolie to work with a foreign oil company such as Koch in the potential future exploration for new oil fields outside the proved reserves has been encouraging. The open and receptive approach employed by both Staatsolie and Koch has allowed our two companies to build mutual trust, which is crucial for potential long-term cooperation.

One aspect of Staatsolie in which all of Suriname can be proud is the company's success in establishing a clean, efficient, non-polluting and well-maintained oil field. Staatsolie's commitment to maintaining a clean environment and a healthy community indicates the company’s commitment to good core values.

In our conversations with management, including Misters Jharap, Nuboer, Waaldijk and Gubler, and Saramacca field staff, we recognized that Staatsolie is dedicated to the same core values which have allowed us to build Koch into a successful company. The cornerstones to the success of organizations like Staatsolie and Koch are values such as dedication to one's company and community, integrity, respect for others, a passion to learn and continuous improvement.

Koch has been able to develop a high level of respect for both you and your staff in the Ministry of Natural Resources and in Mr. Jharap, the Senior Management and the employees of Staatsolie. We now expect to present our technical evaluation of Suriname's onshore oil exploration potential to Koch's Senior Management during the next few weeks. If our Senior Management grants us approval, Koch's ultimate objective would be to establish a Production Sharing Contract later this year with Staatsolie which would be advantageous to the Surinamese community, as well as to Staatsolie and Koch.

Mr. Minister, if you have any questions, comments or advice, please feel free to contact me by phone at 1-403-716-7501 or by fax at 1-403-716-7405. Or, if you prefer, you may always contact U.S. Ambassador Hays and request that he pass any information onto us.

We look forward to our ongoing evaluation of the possibilities for a partnership with Staatsolie, the Republic of Suriname and the Surinamese people. Mr. George Folsom of Koch joins me in sending to you our best regards.

Sincerely,

Rodger D.Trimble, P.Eng.

Manager, Reservoir Engineering – International

Copies to: Drs. Eddy Jharap (Staatsolie)

Ing. Erik L. Tjon Kie Sim (Chairman - Staatsolie Board)

U.S. Ambassador Dennis Hays (U.S. Embassy)