OCEANIC EXPLORATION CO, SB-2, 1995-10-06

OCEANIC EXPLORATION CO
SB-2, 1995-10-06
CRUDE PETROLEUM & NATURAL GAS

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<PAGE>

As filed with the Securities and Exchange Commission on October 6, 1995
Registration No. 33-

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

OCEANIC EXPLORATION COMPANY
(Exact name of small business issuer in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Delaware 1330 84-0591071
(State or other jurisdiction of Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number Identification No.)
</TABLE>

5000 South Quebec Street, Suite 450
Denver, Colorado 80237
(303) 220-8330
(Address and telephone number, of registrant's principal executive offices)

CHARLES N. HAAS, PRESIDENT
OCEANIC EXPLORATION COMPANY
5000 South Quebec Street, Suite 450
Denver, Colorado 80237
(303) 220-8330
(Name, address and telephone number of agent for service)

Copies of communications to:
RICHARD T. BEARD, ESQ.
WILLIAM D. MARSH, ESQ.
Ballard Spahr Andrews & Ingersoll
201 South Main Street, Suite 1200
Salt Lake City, UT 84111

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: Thirty
days after the effective date of this Registration Statement.

CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>

Proposed Proposed
maximum maximum
Title of securities Amount to offering price aggregate Amount of
to be registered be registered per share offering price(1) registration fee
---------------- ------------- --------- ----------------- ----------------
<S> <C> <C> <C> <C>
Common Stock 6,001,000 Shares $.10 $600,100 $206.93
- -------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c).

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY
DETERMINE.

<PAGE>

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURTIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
ANY SUCH STATE.

<PAGE>

SUBJECT TO COMPLETION, DATED OCTOBER 6, 1995

6,001,000 Shares

OCEANIC EXPLORATION COMPANY

Common Stock
($.0625 par value)

As more fully set forth herein, Oceanic Exploration Company (the "Company")
is offering to the holders of its Common Stock, $.0625 par value (the "Common
Stock") the right to subscribe for additional shares of Common Stock (the
"Rights Offering") on the basis of 1.5325 shares of Common Stock for each share
of Common Stock held of record at the close of business on October __, 1995
[insert effective date of Registration Statement] (the "Rights").

THE RIGHTS WILL EXPIRE AT 5:00 P.M., DENVER, COLORADO TIME ON OCTOBER __,
1995 [INSERT DATE 30 DAYS AFTER EFFECTIVE DATE OF REGISTRATION STATEMENT].
FAILURE TO EXERCISE RIGHTS COULD RESULT IN SUBSTANTIAL DILUTION TO NON-
EXERCISING STOCKHOLDERS. SEE "RISK FACTORS--DILUTION OF NON-EXERCISING
STOCKHOLDERS."

The Common Stock is listed on The Pacific Stock Exchange under the symbol
OXC. The Company has been notified that it is subject to delisting procedures.
See "RISK FACTORS--POTENTIAL DELISTING FROM THE PACIFIC STOCK EXCHANGE" and
"DESCRIPTION OF CAPITAL STOCK." The reported closing price of the Common
Stock on October 3, 1995 was $.25. See "MARKET FOR COMMON EQUITY."
_______________________

THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. PROSPECTIVE
INVESTORS SHOULD CAREFULLY CONSIDER THE RISKS SET FORTH IN "RISK FACTORS."
_______________________

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

______________________
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<CAPTION>

Underwriting
Price to Discounts and Proceeds to
Public Commissions Company (1)
------ ----------- -----------
<S> <C> <C> <C>
Per Share. . . . . . . . $.10 N/A $.10

Total. . . . . . . . . . $600,100 N/A $600,100
</TABLE>

(1) Before deducting estimated expenses of the offering of $55,000 payable by
the Company.
____________________

The date of this Prospectus is October 6, 1995

<PAGE>

PROSPECTUS SUMMARY

THIS SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED INFORMATION
AND FINANCIAL STATEMENTS AND RELATED NOTES APPEARING ELSEWHERE IN THIS
PROSPECTUS. SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS TO BE
CONSIDERED IN EVALUATING THE COMPANY AND ITS BUSINESS.

THE COMPANY

The Company was incorporated in 1969 and has been engaged in the business
of acquiring oil and gas concessions covering large blocks of acreage and in
conducting exploration activities thereon, including seismic and other
geophysical evaluation and exploratory drilling where appropriate. The Company
conducts its operations directly or through wholly-owned subsidiaries. The term
"concession" is used herein to mean exploration, development and production
rights with respect to a specific area, which rights may be created by agreement
with a government, governmental agency or corporation. When a discovery of oil
or gas occurs, the Company has pursued the development of reserves and the
production of oil or gas to the extent considered economically feasible and has
financed development by farming out or selling a portion of its interest in the
discovery. The Company's property interests are located in the North Aegean
Sea, offshore Greece ("Prinos") and in the East China Sea. The Company has
identified a prospect in Bolivia, has prepared a preliminary plan for
exploration and is attempting to find participants to finance the exploration
costs. Since 1994 the Company has not been able to participate in active
operations and exploration and development, other than limited activities in
Bolivia to the extent funding is available, and has concentrated its efforts on
the litigation regarding the Prinos Interest. SEE "BUSINESS OF THE COMPANY."

The Company's only significant source of revenue, its 15% net profit
interest in certain oil and gas producing areas offshore Greece ("Prinos
Interest"), is currently the subject of litigation. The prospects for the
Company continuing as a going concern are dependent on obtaining a favorable
judgment or settlement in the litigation and collecting or enforcing the
judgment or settlement. Since litigation was commenced, payments under the
Prinos Interest have been suspended. The Company has funded its operations
through draws against the line of credit established with NWO Resources, Inc.
("NWO"), the parent of the Company's principal stockholder. Prior to the end of
fiscal year 1995, the Company's credit line was exhausted. Currently the
Company has no resources to make monthly interest payments on the advances
under the line of credit.

On September 19, 1995, the Company entered into a Modification Agreement
with NWO (the "Modification Agreement"). SEE "BUSINESS OF THE COMPANY--NWO LINE
OF CREDIT." The Modification Agreement provides for limited funding of
litigation expenses and temporary relief from any collection actions by NWO.
The Modification Agreement does not provide any further funding for operating
expenses of the Company other than limited funding of the litigation with
respect to the Prinos Interest.

<PAGE>

Future operations of the Company, reimbursements of advances for legal fees
in connection with the litigation of its Prinos Interest and financing the
working capital deficit as necessary will be funded by this Rights Offering.
The Company estimates that the funding provided from the Rights Offering will be
sufficient to fund the litigation through June 30, 1996 (including repayment of
advances from NWO for litigation expenses), the date by which time the Company
anticipates a judgment will be rendered in the litigation, and to fund limited
operations through December 1996. The working capital deficit may also be
funded as necessary and as funds are available. There is no assurance that the
proceeds of the Rights Offering will be sufficient to fund the Company's
operations until the Company is able to resolve the litigation and collect a
judgment or settlement. SEE "USE OF PROCEEDS" AND "MANAGEMENT DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS".

The Company's business activities involve only one industry segment, oil
and gas exploration and development.

The Company employs six people, four of whom are full-time employees. The
full-time employees also provide services to two related entities pursuant to
management agreements entered into by the Company and those entities. SEE
"CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."

The Company's principal executive offices are located at 5000 South Quebec
Street, Suite 450, Denver, Colorado 80237, and its telephone number is (303)
220-8330.

THE RIGHTS OFFERING

Common Stock Offered 6,001,000 shares

Terms 1.5325 shares of Additional Common Stock
for each share of Common Stock owned on
the Record Date, rounded up to the
nearest whole share.

Subscription Price $.10 per share

Expiration Date of Rights ________ __, 1995 [insert date 30 days
after effective date of Registration
Statement], 5:00 p.m., Denver Colorado
time

Use of Proceeds The Company intends to use the net
proceeds of the Rights Offering for
working capital, to repay advances to
fund litigation expenses, and to fund
the working capital deficit as
necessary.

<PAGE>

SUMMARY FINANCIAL INFORMATION

The following table sets forth summary financial data of the Company. The
summary financial data in the table is derived from the financial statements of
the Company. The data should be read in conjunction with the financial
statements, related notes and other financial information included therein.

Year Ended March 31, Three Months Ended June 30,
--------------------------- ---------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>

STATEMENT OF EARNINGS DATA:

Revenue. . . . . . . . . . . . $ 321,495 835,329 120,164 253,427

Costs and Expenses . . . . . . $1,195,369 1,153,304 272,076 298,704

Loss before Income Taxes . . . $ (873,874) (317,975) (151,912) (45,277)

Net Loss . . . . . . . . . . . $ (796,602) (448,746) (119,852) (84,810)

Net Loss per Share
of Common Stock. . . . . . . $ (.20) (.11) (.03) (.02)
</TABLE>

March 31, 1995 June 30, 1995
-------------- ---------------------------------------

Actual Actual As Adjusted(1)
------ ------ --------------

<S> <C> <C> <C>
BALANCE SHEET DATA:

Net working capital (deficit). . . $(2,554,850) (2,637,549) (2,092,449)

Total assets . . . . . . . . . . . $ 1,557,322 1,496,801 2,041,901

Stockholders' deficit. . . . . . . $(2,007,281) (2,127,133) (1,582,033)
</TABLE>

(1) As adjusted to give effect to the sale of 6,001,000 shares of Common Stock
offered hereby at an assumed offering price of $.10 per share and the
application of the estimated net proceeds therefrom. SEE "USE OF PROCEEDS"
AND "CAPITALIZATION."

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). This Prospectus, which
constitutes a part of a registration statement on Form SB-2 (the "Registration
Statement") filed by the Company with the Commission under the Securities Act of
1933, as amended (the "Securities Act"), omits certain of the information set
forth in the Registration Statement. Reference is hereby made to the
Registration Statement and to the exhibits thereto for further information with
respect to the Company. Statements contained herein concerning the provisions
of such documents are necessarily summaries of such

<PAGE>

documents, and each statement is qualified in its entirety by reference to the
copy of the applicable document filed with the Commission. The Registration
Statement, including exhibits and schedules filed therewith, and the reports,
proxy statements and other information filed by the Company with the Commission
may be inspected without charge at the public reference facilities maintained by
the Commission at its principal office at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at regional offices of the Commission
located at Northwestern Atrium Center, Suite 1400, 500 West Madison Street,
Chicago, Illinois 60661 and Seven World Trade Center, 13th Floor, New York, New
York 10048. Copies of such materials may be obtained from the Public Reference
Section of the Commission, Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and its public reference facilities in Chicago,
Illinois and New York, New York, at prescribed rates. The Company's Common
Stock is listed on The Pacific Stock Exchange, and copies of the reports, proxy
statements and other information filed by the Company can be inspected at such
exchange.

RISK FACTORS

Prospective purchasers of shares of Common Stock should carefully read the
entire Prospectus. Purchasers should consider, among other things, the
following factors which make an investment in the Company extremely high risk:

OFFERING PRICE. The price at which the Common Stock is being sold to the
stockholders is not based on an independent valuation of the Company or its
assets or other recognized criteria of investment value. The Subscription Price
for the Common Stock was negotiated with NWO, the parent company of
International Hydrocarbons, the Company's principal stockholder. The
Subscription Price is based on the highest price at which International
Hydrocarbons would agree to purchase all Common Stock not subscribed for by
other stockholders. It does not indicate that the Common Stock has a value of
or could be resold at the Subscription Price. SEE "DETERMINATION OF OFFERING
PRICE."

GOING CONCERN DEPENDENT ON LITIGATION. The Company's only significant
source of revenue, its Prinos Interest, is currently the subject of litigation.
The prospects for the Company continuing as a going concern are dependent on
obtaining a favorable judgment or settlement in the litigation and collecting or
enforcing the judgment or settlement. While the Company believes there is a
reasonable possibility of prevailing in the litigation, the ultimate outcome of
the lawsuit cannot be determined at this time. Furthermore, there are no
assurances that the Company will be able to collect on a successful judgment or
settlement of the pending litigation. If the Company is not able to obtain a
favorable judgment or settlement and collect on the judgment or settlement, the
Company may be forced to liquidate its assets, and in such case, little if any
assets will be available for distribution to shareholders. SEE "BUSINESS OF THE
COMPANY" AND "LEGAL PROCEEDINGS."

LIQUIDITY AND CAPITAL REQUIREMENTS. The Company has been dependent upon
the Prinos Interest as its primary source of income. Since the initiation of
the litigation involving the

<PAGE>

Prinos Interest, the Company has not received any revenue applicable to it. The
Company has depended on draws on a line of credit facility provided by NWO to
fund its operations. NWO is the parent corporation of the Company's principal
stockholder, International Hydrocarbons. The line of credit with NWO has been
exhausted, and the Company has no funds to repay NWO the advances under the line
of credit. The Company has entered into a Modification Agreement with NWO,
which provides for forbearance in collection of interest and principal under the
NWO line of credit and limited financial assistance to the Company for payment
of litigation costs with respect to the Prinos Interest. The Company will
require additional funds to pay its litigation costs and continue limited
operations. The proceeds of the Rights Offering are intended for working
capital, to fund the litigation and to fund the working capital deficit as
necessary. However, additional funds may also be required in excess of the
proceeds of the Rights Offering depending on the cost of litigation, appeals, if
any, and the time it may take to collect on a judgment or settlement. Because
of the Company's financial condition, there is no assurance that the Company
will have adequate funding to complete the litigation or continue operations if
the litigation is protracted. Obtaining the additional financing may be
difficult and there can be no assurances that the Company will be successful in
doing so. The Company has no alternative plans to obtain or commitments to
provide additional financing if such financing is necessary.

SHORT TERM LIABILITIES. The Company has two significant liabilities that
will likely require payment within the next 18 months. First, the Company will
be obligated to repay advances made by NWO for the Company's legal fees. This
reimbursement is anticipated to be made with the proceeds of this Rights
Offering but is due by January 31, 1996. Second, the repayment of the NWO line
of credit of $2,000,000 plus accrued interest is due on December 31, 1996. Only
if the Company is successful in the litigation and is able to collect funds from
Denison Mines Limited ("Denison") or is able to secure funds from other sources
will the Company be able to repay the $2,000,000 borrowed under the NWO line of
credit. It is highly unlikely that the Company will be able to secure funds
from third parties. The financial statements do not include any adjustments
that might result from the uncertainties associated with the outcome of the
lawsuit or the ability to raise additional financing. SEE "MANAGEMENT
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS."

POTENTIAL DELISTING FROM THE PACIFIC STOCK EXCHANGE. The Company has
failed to maintain the minimum standards required by the Pacific Stock Exchange
to maintain its listing as a Tier II Security on that exchange. On August 25,
1995, the Company was notified that it is subject to the initiation of delisting
procedures. Its listing status was reviewed by the Exchange at a meeting of the
Equity Listing Committee (the "Committee") held on October 3, 1995. The Company
was informed that the Committee had decided to delist its Common Stock. The
Company has the right to appeal the decision of the Committee and the Company
intends to pursue such an appeal. The Company's Common Stock is suspended from
trading as of October 4, 1995 and will remain suspended until the appeals
process is completed. The potential delisting of the Company from the Pacific
Stock Exchange, if it occurs, may have an adverse effect on the market value of
the common stock. See "DESCRIPTION OF CAPITAL STOCK."

DILUTION OF NON-EXERCISING STOCKHOLDERS. The Company has received a
commitment by International Hydrocarbons, the Company's principal stockholder,
to purchase all shares of Common Stock not subscribed for by other stockholders
pursuant to the Rights Offering.

<PAGE>

Consequently, the Company believes that it will sell all Common Stock offered in
this Rights Offering. As a result, the effective percentage ownership of any
non-exercising stockholder will be reduced by approximately sixty percent. For
example, a stockholder that currently owns one percent of the Company and does
not exercise its Rights will own approximately four-tenths of one percent after
completion of the Rights Offering. If further equity financing is required,
additional dilution may take place. If all stockholders exercise their Basic
Subscription Rights, the effective percentage ownership of each stockholder will
remain unchanged. In addition, the Subscription Price of $.10 is substantially
less than the price at which the Common Stock has traded during the last twelve
months. The effect of the Rights Offering will likely be to decrease the
current market value of the Common Stock.

The Company is currently in a deficit position and will continue to be in a
deficit position after the Rights Offering. Proceeds contributed as a result of
the Rights Offering will not have a book value after the Rights Offering.

COMPETITION. The oil and gas industry is competitive, and the Company must
compete with many long-established companies having far greater resources and
operating experience. Furthermore, the demand for financing of oil and gas and
mineral exploration and development programs substantially exceeds the available
supply, and the Company competes with other exploration and development
companies of far greater means for the available funds. Because of the
Company's financial condition, the Company is not currently able to participate
in exploration and development activities. Even if funds are raised from the
offering, the scope of the Company's exploration activities will be constrained
by the shortage of funds.

OIL AND GAS PRODUCTION. Oil and gas exploration activities, especially in
foreign areas, are subject to a wide variety of risks which affect not only the
concessions themselves but also their salability (whether of partial interests
or otherwise) to third parties. The industry is also subject to fluctuations in
the price of and the demand for oil and gas. In addition, there is no guarantee
that the Prinos Interest, the Company's principal source of revenue, will
continue to produce revenue in the future as it has in the past. While the
Prinos Interest includes new wells either drilled or being drilled on or near
the Prinos producing field, there is no assurance that these wells will produce
significant quantities of oil and gas. SEE "MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS."

FOREIGN OPERATIONS. The Company's oil and gas concessions are generally
located in territories controlled by foreign governments. As a result the
concessions may be subject to the following risks:

(i) Potential expropriation or nationalization of concessions or
facilities by foreign governments;

(ii) Jurisdictional disputes between foreign governments concerning
areas in which the Company's concessions are located;

<PAGE>

(iii) Civil unrest or significant political changes in foreign
countries in which the Company holds concessions;

(iv) Taxation by foreign governments of the Company's income derived
within their jurisdiction combined with uncertainties over the availability
in the United States of foreign tax credits for taxes actually paid to
foreign governments; and

(v) Fluctuations in the price of and the demand for oil and gas.

Certain of the Company's properties are subject to current disputes between
foreign governments which have essentially, in addition to the Company's lack of
funds, precluded development of those properties. There is no assurance that
such disputes will be resolved in a timely manner. SEE "BUSINESS OF THE
COMPANY."

LACK OF DIVIDENDS. The Company has never paid a dividend on its Common
Stock and does not intend to do so in the foreseeable future. Any future
payment of dividends by the Company is subject to the discretion of the Board of
Directors.

CONTROL BY PRINCIPAL SHAREHOLDER. The principal shareholder of the Company
is International Hydrocarbons. International Hydrocarbons currently owns 43.8%
of the Common Stock. If all stockholders exercise their Basic Subscription
Rights, the effective percentage ownership of each stockholder will remain
unchanged. If Basic Subscription Rights are not exercised by any other
stockholder, International Hydrocarbons will control approximately 77.8% of the
issued Common Stock. Accordingly, International Hydrocarbons will potentially
increase its ability to exert significant influence over the policies and
affairs of the Company.

RIGHTS OFFERING

The Company is offering to holders of its outstanding Common Stock of
record at the close of business on _______ __, 1995 [insert effective date of
Registration Statement] (the "Record Date"), the right to subscribe for and
purchase 1.5325 shares of Common Stock ("Additional Common Stock") for each
share of Common Stock held of record on the Record Date. The Rights may be
exercised by executing the Subscription Agreement and by paying $.10 per share
("Subscription Price") as described below.

SUBSCRIPTION EXPIRATION DATE

This Rights will expire at 5:00 P.M., Denver, Colorado Time on _______ __,
1995 [insert date 30 days after effective date of Registration Statement] (the
"Expiration Date"). AS DESCRIBED BELOW, RIGHTS MUST BE EXERCISED, IF AT ALL,
BEFORE THE EXPIRATION DATE AFTER WHICH TIME THE RIGHTS WILL BE VOID AND
VALUELESS.

<PAGE>

BASIC SUBSCRIPTION RIGHTS

The Rights entitle the holders to subscribe at the Subscription Price of
$.10 per share for shares of Additional Common Stock on the basis of 1.5325
shares of Additional Common Stock for each share of Common Stock held on the
Record Date (the "Basic Subscription Rights"). The number of shares for which a
stockholder may subscribe will be rounded up to the nearest whole share. No
fractional shares will be issued. Exercise of the Basic Subscription Rights
will also entitle the holders to the Over-Subscription Privilege described
below. SEE "OVER-SUBSCRIPTION PRIVILEGE."

METHOD OF EXERCISING RIGHTS

To exercise the Rights, the holder should fill in Section 1 on the
Subscription Agreement and sign and transmit it along with the required payment,
in the envelope provided, to Oceanic Exploration Company at 5000 South Quebec
Street, Suite 450, Denver, Colorado 80237. The Subscription Agreement must
arrive on or before the Expiration Date.

PAYMENT

Rights exercised under the Basic Subscription Rights and the Over-
Subscription Privilege must be accompanied by payment of the full Subscription
Price in U.S. Dollars for all shares. Such payment may be made by mail. Payment
may be made by certified check or bank draft drawn upon a United States bank, or
postal, telegraphic or express money order, payable to the order of "Oceanic
Exploration Company". Sufficient mailing time should be allowed for the
Subscription Agreement and payment to be RECEIVED by the Company before the
Expiration Date of the subscription period at 5:00 P.M., Denver, Colorado Time,
_______ __, 1995 [insert date 30 days after the effective date of Registration
Statement], after which time the Rights will be void and valueless. Payment may
also be made by hand delivery to the Company, in cash or by certified check or
bank draft drawn upon a United States bank, or postal, telegraphic or express
money order, payable to the order of "Oceanic Exploration Company".

The Company reserves the right to reject any Subscription Agreement and
payment not properly submitted. The Company has no duty to give notification of
defects in any Subscription Agreement and/or payment and will have no liability
for failure to give such notification. The Company will return any Subscription
Agreement and/or payment not properly submitted.

PURCHASE AND SALE OF RIGHTS

Rights may not be transferred, divided, combined, purchased or sold.

<PAGE>

DELIVERY OF CERTIFICATES

Certificates for shares of Additional Common Stock issuable on exercise of
Rights will be mailed as soon as practicable after the Expiration Date.

OVER-SUBSCRIPTION PRIVILEGE

If some stockholders do not exercise all of their Basic Subscription
Rights, the remaining Additional Common Stock will be offered to those holders
of Basic Subscription Rights who wish to acquire more than the number of shares
to which their Basic Subscription Rights entitle them (the "Over-Subscription
Privilege"). Each holder of Basic Subscription Rights who fully exercises Basic
Subscription Rights will be entitled to participate in such Over-Subscription
Privilege and will be asked to indicate on the Subscription Agreement how many
additional shares that stockholder would be willing to acquire pursuant to the
Over-Subscription Privilege. If there remain sufficient shares of Additional
Common Stock after the exercise of Basic Subscription Rights, all over-
subscriptions will be honored in full. If there are not sufficient shares of
Additional Common Stock to honor all over-subscriptions, the available
Additional Common Stock will be allocated among those who over-subscribe based
solely on the number of shares subscribed for by each over-subscribing holder
pursuant to the Basic Subscription Rights. For example, if after the exercise
of the Basic Subscription Rights (1) there remain 150,000 shares of Additional
Common Stock that were not subscribed for pursuant to Basic Subscription Rights,
(2) two stockholders each indicated that they wished to acquire shares of
Additional Common Stock pursuant to the Over-Subscription Privilege, (3) the
first stockholder oversubscribed for 150,000 shares and the second stockholder
oversubscribed for 200,000 shares and each tendered payment for that number of
shares and (4) the first stockholder acquired 100,000 shares pursuant to its
full Basic Subscription Rights and the second stockholder acquired 200,000
shares pursuant to its full Basic Subscription Rights; then the first
stockholder would be entitled to one-third or 50,000 shares of the Additional
Common Stock and the second stockholder would be entitled to two-thirds or
100,000 shares of the Additional Common Stock.

The percentage of remaining shares of Additional Common Stock each over-
subscribing holder may acquire may be rounded up or down to result in delivery
of whole shares. The allocation process may involve a series of allocations in
order to assure that the shares available for over-subscription are distributed
proportionately among all over-subscribing holders. Accordingly, the degree to
which each stockholder's request for shares of Additional Common Stock pursuant
to the Over-Subscription Privilege will be honored will depend on the number of
shares of Additional Common Stock requested, the number of shares acquired by
the exercise of Basic Subscription Rights and the total number of shares of
Additional Common Stock available for over-subscription. After the expiration
of the Basic Subscription Rights, the Company will send notice of the number of
shares of Additional Common Stock acquired pursuant to the Over-Subscription
Privilege to each stockholder that over-subscribed and promptly remit to such
stockholder any payment tendered to the Company for shares not acquired under
the Over-Subscription Privilege. The Company has received a commitment from
International Hydrocarbons, its principal stockholder, to purchase all shares of
Additional

<PAGE>

Common Stock not subscribed for pursuant to the Basic Subscription Rights or the
Over-Subscription Privilege.

FEDERAL INCOME TAX INFORMATION

The federal income tax consequences to stockholders of the issuance and
disposition of Rights to purchase Additional Common Stock generally will be as
follows:

RECEIPT OF RIGHTS. The receipt of Rights will not result in taxable income
to stockholders.

TAX BASIS OF RIGHTS AND COMMON STOCK FOR DETERMINING GAIN OR LOSS ON
SUBSEQUENT SALES. For purposes of determining gain or loss on subsequent sales
of Common Stock, the tax basis of Rights in the hands of each stockholder to
whom such Rights are issued will be zero and the tax basis in the Common Stock
with respect to which Rights are issued will remain unchanged. Notwithstanding
this general rule, each stockholder may elect, with respect to all Rights issued
to it, to allocate the tax basis of all shares of Common Stock that it holds on
the Record Date between such shares and the Rights issued to it in proportion to
their fair market values on the date the Rights are issued. To be valid, this
election must be made by the stockholder in a statement attached to its timely-
filed 1995 Federal income tax return, and once made, is irrevocable. However,
if on the date the Rights are issued the fair market value of the Rights is 15%
or more of the fair market value of the Common Stock, each stockholder will be
required to allocate the tax basis of its shares of Common Stock in the manner
described above in determining gain or loss on any subsequent sales of Common
Stock.

EXERCISE OF RIGHTS. The exercise of Rights will not result in taxable
income or loss. The tax basis of the Additional Common Stock acquired upon the
exercise of Rights will be the Subscription Price of such Additional Common
Stock, increased by the tax basis (if any) of the Rights exercised to acquire
such Common Stock.

EXPIRATION OF RIGHTS. A stockholder who allows Rights issued to him to
expire without exercise is not required and may not elect to allocate any tax
basis to such Rights, and will therefore not recognize a loss on account of the
expiration.

HOLDING PERIOD. The holding period of the Rights received on distribution
from the Company is measured from the acquisition date of the Common Stock which
gave rise to the Rights. The holding period of Additional Common Stock acquired
by exercise of Rights commences with the date on which such Rights are
exercised.

STATE TAX INFORMATION

Participants should consult with their own income tax advisors to determine
the applicable state income tax consequences of the issuance and exercise of
Rights to purchase the Additional Common Stock.

<PAGE>

THE FOREGOING IS A GENERAL SUMMARY OF FEDERAL INCOME TAX TREATMENT UNDER
PRESENT LAW. THESE RULES ARE COMPLEX AND SUBJECT TO CHANGE. EACH STOCKHOLDER
SHOULD CONSULT HIS OR HER OWN TAX ADVISOR FOR MORE DETAILED INFORMATION AS TO
THE TAX CONSEQUENCES APPLICABLE TO HIS OR HER OWN SITUATION.

RESALE OF ADDITIONAL COMMON STOCK

Subject to applicable state securities laws, stockholders who are not
"affiliates" of the Company may generally resell, without restriction, the
Additional Common Stock acquired pursuant to the Basic Subscription Rights or
the Over-Subscription Privilege. Stockholders who are deemed to be "affiliates"
of the Company may resell the Additional Common Stock acquired pursuant to the
Basic Subscription Rights or the Over-Subscription Privilege only pursuant to
Rule 144 under the Securities Act or in a transaction otherwise exempt from
registration under the Securities Act and subject to applicable state securities
laws.

USE OF PROCEEDS

The following table illustrates the Company's current expectations as to
the use of the proceeds from the Rights Offering described herein. The Company
has no firm understanding or agreement concerning items listed and no binding
budget has been established, except for reimbursement obligations to NWO (SEE
"BUSINESS OF THE COMPANY--NWO LINE OF CREDIT"). The amounts stated herein are
estimates only and the actual expenditures may vary from the estimate.
<TABLE>
<CAPTION>
<S> <C>
Gross Proceeds: $600,100
Cost of Offering (1) (55,000)
---------

Net Proceeds $545,100
--------
--------

Reimbursement to NWO of current advances including estimated
accrued interest (2) 103,000
Fund future operations and working capital deficit as necessary (3) 442,100
-------

Net Proceeds $545,100
--------
--------
</TABLE>

(1) The costs of offering includes professional fees incurred in the
preparation of this Prospectus and printing, copying and miscellaneous
expenses.

(2) Pursuant to the Modification Agreement between the Company and NWO, the
Company has agreed to reimburse NWO from the proceeds of the Rights
Offering for advances made by NWO to pay the Company's ongoing legal fees
in connection with the litigation against Denison together with interest at
10% per annum. NWO has agreed to advance the Company up to $100,000 to pay
ongoing legal fees as reflected in statements received

<PAGE>

by the Company subsequent to August 1, 1995. SEE "BUSINESS OF THE COMPANY-
-NWO LINE OF CREDIT." Based on the estimated timetable of the litigation
with Denison (SEE "LEGAL PROCEEDINGS"), the Company believes it will have
sufficient funds to finance the remaining litigation through June 30, 1996,
the date prior to which the Company anticipates a judgment to be rendered
in the litigation. There is no provision for costs of appeals from the
judgment, if any, or collection expenses.

(3) This amount should be sufficient to fund limited operations through
December 1996 and to fund the working capital deficit as necessary.

The Company reserves the right to allocate the resources of the Company in
a different manner if necessary or appropriate.

DETERMINATION OF OFFERING PRICE

The Rights Offering is being conducted by the Company in connection with
the Modification Agreement with NWO and is being offered based on the commitment
of International Hydrocarbons to purchase all Additional Common Stock not
purchased by other stockholders. After NWO rejected the Company's proposal to
extend or increase the line of credit, the terms of the Rights Offering and the
Modification Agreement were negotiated with NWO by the two independent members
of the Company's Board of Directors (the "Independent Directors"). The
Subscription Price is based on the highest price at which International
Hydrocarbons would agree to purchase all Common Stock not subscribed for by
other stockholders. The terms of the Rights Offering and the Modification
Agreement negotiated with NWO were unanimously recommended by the Independent
Directors and approved by a majority of the Company's Board of Directors on
August 8, 1995. SEE "BUSINESS OF THE COMPANY--NWO LINE OF CREDIT".

The principal factors in the negotiations with NWO were the nonavailability
of revenue from other sources and the opportunity for stockholders to
participate in the financing through the Rights Offering. The Company has not
sought an independent third party opinion with respect to the value of the
Company or the appropriateness of the Subscription Price. The Subscription
Price has no relation to the market value of the Common Stock of the Company,
the value of the Company's assets or the Company's prospects as a going concern.

BUSINESS OF THE COMPANY

The Company was incorporated in 1969 and is engaged in the business of
acquiring oil and gas concessions covering large blocks of acreage and in
conducting exploration activities thereon, including seismic and other
geophysical evaluation and exploratory drilling where appropriate. The Company
conducts its operations directly or through wholly-owned subsidiaries. The term
"concession" is used herein to mean exploration, development and

<PAGE>

production rights with respect to a specific area, which rights may be created
by agreement with a government, governmental agency or corporation. When a
discovery of oil or gas occurs, the Company will pursue the development of
reserves and the production of oil or gas to the extent considered economically
feasible and may finance development by farming out or selling a portion of its
interest in the discovery. The Company's property interests are located in the
North Aegean Sea, offshore Greece, and in the East China Sea. The Company has
identified a prospect in Bolivia, has prepared a preliminary plan for
exploration and is attempting to find participants to finance exploration costs.
Since 1994 the Company has not been able to participate in exploration and
development, other than limited activities in Bolivia to the extent that funding
is available, and has concentrated its efforts on the litigation regarding the
Prinos Interest.

The Company's business activities involve only one industry segment, oil
and gas exploration and development.

The Company's principal executive offices are located at 5000 South Quebec
Street, Suite 450, Denver, Colorado 80237, and its telephone number is (303)
220-8330.

MODE OF OPERATION

The Company has generally undertaken exploration of concessions through
various forms of joint arrangements with unrelated companies, whereby the
parties agree to share the costs of exploration, as well as the costs of and any
revenue from a discovery. Such arrangements do not always equate the proportion
of expenditures undertaken by a party with the share of revenues to be received
by such party.

The Company has usually obtained concessions directly from a government or
governmental agency and has then entered into arrangements with other
participants whereby the Company has received cash payments and has had its
share of exploration expenditures paid (either before or after being expended)
in whole or in part by other participants.

Since the Company's establishment, sales of partial interest in its
concessions have been part of its normal course of business and have provided
funds for the acquisition of further concessions and for exploration of existing
concessions. Some of the competition and risk factors relating to this method
of doing business are referred to above in "RISK FACTORS."

In order to maintain its concessions in good standing, the Company is
usually required to expend substantial sums for exploration and, in many
instances, for surface rentals or other cash payments. Additionally, the
development of any discoveries made upon concessions in

<PAGE>

which the Company holds an interest generally involve the expenditure of
substantial sums of money. The Company has, in the past, satisfied required
expenditures on its concessions. The Company cannot be certain that its
revenues in the future will be sufficient to satisfy expenditures required to be
made on its concessions.

PROPERTIES

The Company holds various interests in concessions or leases for oil and
gas exploration which are listed below. Oil and gas property interests as
reflected in the accompanying financial statements include costs attributable
only to the Prinos Interest. Costs on all other foreign concessions described
below have been charged to expense in prior years.

GREECE. The Company has the right to receive the Prinos Interest payable
by Denison from the proceeds of production of oil and gas from certain
concession areas totaling approximately 430,000 acres in the North Aegean Sea,
offshore Greece. "Development areas" for the Prinos Oil Field covering 23,390
gross acres and for the Kavala Gas Field covering 11,787 gross acres have been
defined by the Greek government and given "development status." The term of
each "development" license is 26 years, with an automatic 10-year renewal. The
remaining exploration area adjoining Prinos and South Kavala covers 153,316
acres and an exploration area east of the island of Thasos covers an additional
243,367 acres.

According to Denison's 1994 Annual Report, daily production during calendar
year 1994 from the Prinos/South Kavala Fields averaged 10,690 barrels of oil and
153 tons of sulphur. Denison reported that calendar year 1994 production was
essentially maintained at levels achieved in calendar year 1993 as a result of
the completion of workovers and the drilling of infill wells and that two more
infill wells are being considered for 1995 in order to maintain economic rates
of production.

Due to high Greek income taxes and royalties in combination with declining
production levels, low oil prices and increasing operating costs, the consortium
believed that the Greek operation was at its economic breakeven point. As a
result, Denison and its partners commenced negotiations in 1992 with senior
Greek government officials to obtain relief from the high level of government
taxes and royalties. On February 23, 1993, the consortium reached an agreement
with the Greek government resulting in an amendment to the June 1975 license
agreement (the "License Agreement") known as Law 98/1975 which regulates the
operation of the field. The amendment was ratified by the Greek Parliament on
June 23, 1993 and was retroactive to January 1, 1993.

The amendment provides for a sliding scale for both the cost recovery
factor and the Greek royalty interest based on the annual adjusted gross income
from operations on a calendar year basis. The new law also provides for a
reduction in the effective Greek income tax rate from 50% to 40%.

<PAGE>

In addition, the new law required Denison and its partners to spend $15
million during 1993 and 1994 on infill drilling in order to enhance the
recoverability of the hydrocarbons. In March 1994, the consortium operating the
Prinos properties announced the discovery of a new oil field by the drilling of
the Prinos North-2 well. Denison's 1994 Annual Report states that two oil
bearing zones were flow tested with a 30 meter upper section flowing at about
3,200 barrels per day and a 7 meter lower section flowing at 150 barrels per
day. Oil in place was calculated at about 18 million barrels of which 5 million
may be recoverable. The crude from this discovery has an API gravity of about
25 degrees, contains about 7% sulphur and may have a selling value of between
$1.50 and $4.00 per barrel less than Prinos crude. Recent discussions with
Denison indicate that the consortium is not considering development of Prinos
North at this time.

Denison, who has the contractual obligation to pay the Prinos Interest, has
asserted that the calculation of the amounts due the Company should be based on
the amended agreement with the Greek government. The amended agreement provides
for higher cost recoveries than the License Agreement before the 1993 amendment.
If the higher cost recoveries are used in calculating the amount due under the
Prinos Interest, the amount will be significantly lower than the amount
calculated under the License Agreement before the 1993 amendment. The Company
disagrees with this interpretation and has commenced legal action seeking a
declaration by the Court that amounts due the Company attributable to its Prinos
Interest be calculated based on the terms of the License Agreement before the
1993 amendment. The Company is seeking damages of approximately $5,000,000 for
the period from January 1, 1993 through March 31, 1994 plus damages since that
date and undetermined future damages. SEE "LEGAL PROCEEDINGS."

There is no assurance as to how long the Prinos property will continue to
produce oil and gas and, accordingly, how long the Company can expect revenue
from its Prinos Interest. The Company has analyzed the data provided to it from
Denison and other data that the Company has been able to verify from publicly
available sources in determining the potential revenue from the Prinos Interest.
The consortium operating the Prinos property has announced a new oil discovery
on or near the Prinos producing field, which is subject to the Prinos Interest.
The Company has not verified the data provided by Denison with respect to that
new oil discovery and its potential revenue and does not have sufficient
resources to do so reasonably. Additionally, the Company is aware that other
members of the consortium believe the estimated amounts provided by Denison may
be exceeded. These analyses are not publicly available and, accordingly, have
not been verified. There is a possibility that the revenues from the Prinos
property would substantially differ from current estimates.

REPUBLIC OF CHINA (TAIWAN). The Company holds a 22.23% working interest in
a concession located north of Taiwan in the East China Sea, covering 3,706,560
gross acres. The exploration license for this concession had a nominal term
extending to 1979, requiring exploration activity and minimum expenditures.
Preparations for initial exploratory drilling were suspended in 1977 under a
claim of force majeure, pending resolution of a territorial dispute

<PAGE>

among the Republic of China (Taiwan), the Government of Japan and the People's
Republic of China. The Chinese Petroleum Corporation (Taiwan) has agreed to
suspend obligations under this concession until December 31, 1995.

During fiscal 1990, the Company entered into a farmout agreement with two
United Kingdom companies conveying two-thirds of its original 66.67% interest in
the concession.

Due to the uncertainty of sovereignty in the area, no immediate development
expenditures, as required under the terms of the concession agreement, are
anticipated. The Company has incurred $27,171 of exploration expenses during
fiscal 1995 as the result of ongoing negotiations with the governments of China
and Taiwan and the reprocessing of seismic data to assist in the future
exploration and development of the concession.

In fiscal year 1994, the Company reported that the People's Republic of
China was indicating its intention to open up adjacent concession areas for
bidding and that a resolution to the sovereignty issues may result. Nothing has
occurred in fiscal year 1995 to indicate that the lifting of the current force
majeure status is imminent.

BOLIVIA. The Company has conducted a preliminary exploration study of a
10,500 square kilometer area located in the eastern part of the country near the
Paraguayan border, pursuant to a work study program with Y.P.F.B., the
government controlled agency having responsibility for oil and gas exploration
in Bolivia. The Company has preliminarily agreed to the terms of an operations
contract pertaining to such area and anticipates signing an operations contract
in fiscal year 1996. The Company is attempting to find participants to finance
exploration costs.

OTHER. The Company leases 2,562 square feet of office space in an office
building located at 5000 South Quebec Street, Denver, Colorado. The office
building is owned by a related party. The lease expires on February 28, 1997.
SEE "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."

NWO LINE OF CREDIT

Since payments under the Prinos Interest were suspended, the Company has
funded its operations through draws against the line of credit established with
NWO. Prior to the end of fiscal year 1995, the Company's credit line was
exhausted. Currently the Company has no resources to make monthly interest
payments on the advances under the line of credit. Accordingly, the Company has
entered into the Modification Agreement, modifying the existing line of credit
arrangement between the Company and NWO. Prior to entering into the Modification
Agreement, the NWO line of credit provided for cumulative draws of up to
$2,000,000 with interest payable monthly on the outstanding balance at the
greater of the U.S. bank prime lending rate or 1-3/4% above the 30-day LIBOR in
effect on the date of each draw against the line of credit. Draws under the
line of credit are evidenced by promissory notes payable by the Company's
wholly-owned subsidiary, Oceanic International Properties Corporation ("OIPC")
no later than January 1, 1996 and bearing interest at annual rates between

<PAGE>

7% and 9%. Cumulative draws on the NWO line of credit had reached $2,000,000 by
February 15, 1995. The line of credit is secured by the Company's Prinos
Interest. At the time the Modification Agreement was entered into, the Company
was in default under the terms of the line of credit as it had not made its
interest payments for May, June, July and August 1995.

The Modification Agreement provides as follows:

1. Except as provided below, NWO will forebear on collection until
December 31, 1996 of the interest and principal on the $2,000,000
of promissory notes evidencing draws on the NWO line of credit
("Oceanic Notes") which it holds from OIPC.

2. Any monies collected by the Company from Denison either before or
after December 31, 1996 will first be applied to paying accrued
interest on the Oceanic Notes. After all accrued interest has been
paid, and prior to December 31, 1996, the Company will be permitted to
use up to $200,000 of monies collected from Denison for working
capital purposes. All remaining collections from Denison will be
applied first to accrued interest and then to reducing principal on
the Oceanic Notes.

3 The Security Agreement between the Company and NWO will be amended to
provide that NWO has a full security interest in all proceeds from the
Company's lawsuit against Denison and any existing and future Company
receivables from Denison.

4. The interest rate on the Oceanic Notes is adjusted to 8.25%.

5. The Company agrees to diligently pursue its lawsuit against Denison.

6. The Company will use its best efforts to file the Registration
Statement with the Securities and Exchange Commission with respect to
the Rights Offering described in the Registration Statement and use
its best efforts to cause the Registration Statement to become
effective by December 31, 1995.

7. In order to enable the Company to diligently pursue its lawsuit
against Denison, NWO agrees to make advances to the Company for
ongoing legal fees as reflected in statements received by the Company
subsequent to August 1, 1995 in connection with the Denison litigation
up to an estimated $100,000 in litigation expenses.

8. The Company agrees to reimburse NWO for such advances up to an
estimated $100,000 together with interest thereon computed at the
annual rate of 10% upon

<PAGE>

receipt of the proceeds of the Rights Offering described in the
Registration Statement or January 31, 1996, whichever occurs earlier.

The foregoing is only a summary of the Modification Agreement and is
qualified in its entirety by reference to the actual Modification Agreement, a
copy of which is an exhibit to the Registration Statement filed with the
Commission and is available upon request. SEE "AVAILABLE INFORMATION."

International Hydrocarbons, which owns approximately 43.8% of the
outstanding common stock of the Company, is a wholly-owned subsidiary of NWO.
International Hydrocarbons has agreed to purchase all shares of Additional
Common Stock not subscribed for pursuant to the Basic Subscription Rights or the
Over-Subscription Privilege. SEE "RIGHTS OFFERING--OVER-SUBSCRIPTION
PRIVILEGE."

LEGAL PROCEEDINGS

The Company has commenced an action in the Ontario Court (General
Division), Canada, against Denison. The Company claims that Denison has failed
since January 1, 1993 to pay the Company the Prinos Interest pursuant to an
agreement dated August 30, 1976, which is to be calculated on the basis of the
terms of the License Agreement.

The Company has claimed the following relief in the action:

1. a constructive trust or equitable lien over funds received by Denison
representing the unpaid portion of the Prinos Interest;

2. a vendor's lien over assets purchased by Denison from the Company including
Denison's interest in the License Agreement; and

3. $27,000,000.00 or alternatively, an accounting and payment of the Prinos
Interest in respect of the period commencing January 1, 1993.

Denison has defended the action on the basis that the Company is not
entitled to the payment claimed, and is entitled only to payment of the Prinos
Interest calculated in accordance with the terms of the License Agreement as
amended by an agreement with the Greek State dated February 23, 1993.

Denison has counterclaimed for the repayment of the sum of $4,747,811 that
it alleges was mistakenly paid to the Company as part of the Prinos Interest
during the period from January 1, 1989, to December 31, 1993.

The statement of claim in this action was issued on June 9, 1994. The
counterclaim was filed June 28, 1994. The matter was transferred to the Ontario
Court (General Division)

<PAGE>

Commercial List by order of November 25, 1994. The parties filed with the Court
the following schedule for the progress of this action:

1. Delivery of documents by April 15, 1995;

2. Examination for discovery of both parties during the week of June 26, 1995;

3. Motions arising from discovery to be completed by October 31, 1995;

4. Trial to be held February 1996.

The Company is vigorously pursuing this action. Oral discovery of the
parties has commenced but has not been completed.

The Company's legal counsel is unable to advise as to the probable outcome
of the claim by the Company. Management's decision to pursue a legal action
against Denison was based on management's review of information provided to the
Company by Denison and discussions with legal counsel. Based on that
information and those discussions, Management believed that there was a
reasonable basis for commencing a legal action against Denison and continues to
believe that there is a reasonable possibility of success in the litigation. Of
course, litigation is inherently uncertain and there is no assurance as to the
final outcome.

It should be noted that if the claim is unsuccessful the Company will
remain entitled to payment of the Prinos Interest calculated in accordance with
the terms of the License Agreement, as amended. The amounts of such payments
will be substantially lower than the payments received prior to January 1, 1993.

The Company's legal counsel has advised that, based on the information
currently available, the Denison counterclaim in the amount of $4,747,811 has a
low probability of success. It should be noted that if the Denison counterclaim
is successful, any amount found to be owing to Denison by the Company may be set
off against any amounts owing by Denison to the Company.

Any judgment obtained by the Company or Denison in relation to the claim or
counterclaim will be subject to the right of the losing party to appeal to the
Ontario Court of Appeal. Notice of appeal to the Court of Appeal must be filed
within 30 days after judgment. Barring an order to expedite the appeal, which
may or may not be available in this case, it may take approximately 2 years
before an appeal is heard. A further appeal to the Supreme Court of Canada is
available with leave of the Supreme Court.

Enforcement of a judgment in Ontario is generally carried out by seizure
and sale of assets, garnishment of debts, or appointment of a receiver. Based
on Denison's public filings, the financial stability of Denison is questionable,
and Denison appears to continue to operate at the sufferance of its secured
creditors. The Company does not have sufficient information in

<PAGE>

its possession to determine whether any assets of Denison are unsecured and
available for satisfaction of a judgment in favor of the Company.

MARKET FOR COMMON EQUITY

The Company's Common Stock is listed on the Pacific Stock Exchange
Incorporated under the symbol OXC. The Pacific Stock Exchange has informed the
Company that it intends to delist its Common Stock due to the current financial
condition of the Company. There are no assurances that the Company will
continue to be listed on the Pacific Stock Exchange. See "RISK FACTORS--
POTENTIAL DELISTING FROM THE PACIFIC STOCK EXCHANGE" and "DESCRIPTION
OF CAPITAL STOCK."

The range of bid quotations in the Company's Common Stock over the last two
years and through August 31, 1995 (which are not necessarily representative of
actual transactions) is set out below.
<TABLE>
<CAPTION>

Three Months Fiscal 1996 Fiscal 1995 Fiscal 1994
-------------------- ---------------- -----------------
Ended High Low High Low High Low
- ------------ -------------------- ---------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
June 30 $.75 .50 $1.13 .88 $1.56 1.38
September 30 .63* .25* .88 .75 1.50 .56
December 31 .75 .50 1.00 .63
March 31 .88 .63 1.13 .75
</TABLE>

* Through August 31, 1995.

These quotations reflect interdealer prices without retail markups,
markdowns and commissions and may not necessarily represent actual transactions.

CAPITALIZATION

The following table sets forth as of June 30, 1995 (i) the actual
capitalization of the Company and (ii) capitalization of the Company as adjusted
for the sale of 6,001,000 shares of Common Stock in this Rights Offering at an
assumed offering price of $.10 per share. SEE "USE OF PROCEEDS."

<PAGE>

June 30, 1995
------------------------------
Actual As Adjusted
--------- -----------
<S> <C> <C>
Stockholders' deficit:

Common stock, authorized 12,000,000
shares of $.0625 par value,
3,915,154 issued and outstanding
actual, 9,916,154 issued and
outstanding as adjusted. . . . . . . . $ 244,697 619,760

Additional Paid in Capital . . . . . . . 6,665 176,702

Accumulated Deficit. . . . . . . . . . . (2,378,495) (2,378,495)
------------ -----------
Total stockholders' deficit. . . . . . $(2,127,133) (1,582,033)
------------ -----------
------------ -----------
</TABLE>

The Company's authorized capital stock also includes 600,000 shares of
Preferred Stock, par value $10.00 per share. The Board of Directors of the
Company, without further action by the stockholders, is authorized to issue the
shares of Preferred Stock in one or more series and to determine the voting
rights, preferences as to dividends, and the liquidation, conversion, redemption
and other rights of each series. The issuance of a series with voting and
conversion rights may adversely affect the voting power of the holders of Common
Stock. The issuance of Preferred Stock may have the effect of delaying,
deferring or preventing a change in control of the Company without further
action by the shareholders. The Company has no present plans to issue any
shares of Preferred Stock. See "DESCRIPTION OF CAPITAL STOCK."

DIVIDENDS

The Company has never paid a dividend. The Company's management does not
anticipate paying dividends in the future.

AVAILABILITY OF OIL AND GAS RESERVE INFORMATION

The Prinos Interest in Greece consists of a contractual right to receive a
15% "net profits interest." Because the Company has a net profits interest and
not a working interest in this property, the Company is only entitled to receive
information regarding current monthly production quantities and net revenue.
Consequently, certain information regarding the operations of the property is
unavailable to the Company. In previous reports to the Commission, the Company
has provided information concerning estimated quantities of proved oil and gas
reserves attributable to the Prinos Interest which had been derived from
publicly available information. Currently, there is no publicly available
information which takes into consideration the effects of the infill drilling
during 1993 and 1994 as required under the 1993

<PAGE>

amendment to the License Agreement known as Law 98/1975. Similarly, the Company
does not have access to the engineering data upon which the infill drilling
program was based. Therefore, the Company is not in a position to estimate the
potential future producible reserves and/or present value of future net revenues
attributable to the Prinos Interest.

OIL AND GAS REVENUE AND COST INFORMATION

Revenue from and costs incurred in oil and gas producing activities for the
fiscal years ended March 31, 1995, 1994 and 1993 are as follows:
<TABLE>
<CAPTION>

Year ended March 31
--------------------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
OIL AND GAS REVENUE (1)
Greece $ - 573,100 4,523,500

Less Greek income taxes paid - (228,100) (2,245,499)
------- ---------- ----------
$ - 345,000 2,278,001
------- ---------- ----------
------- ---------- ----------
CAPITALIZED COSTS RELATED TO OIL
AND GAS PRODUCING ACTIVITIES

Proved properties
Greece $ 39,000,000 39,000,000 39,000,000

Less accumulated depreciation,
depletion and amortization (37,629,909) (37,396,220) (37,151,590)
------------ ---------- ----------
$ 1,370,091 1,603,780 1,848,410
------------ ---------- ----------
------------ ---------- ----------
</TABLE>

(1) The Company's gross revenues are burdened only by Greek income taxes. The
Company has no production costs since its Prinos Interest is a net profits
interest.

The rate of depreciation, depletion and amortization as a percentage of
gross revenues (net of Greek income taxes) for Greece is as follows:
<TABLE>
<CAPTION>

Year ended March 31
-----------------------------------

1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Greece - (2) 71% 30%
</TABLE>

(2) The Company recorded a provision for depreciation, depletion and
amortization of $233,689 for fiscal year 1995 but did not record any revenues
for its Prinos Interest.

<PAGE>

SELECTED FINANCIAL DATA

Year Ended March 31, Three Months Ended June 30,
-------------------- ---------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
STATEMENT OF EARNINGS
DATA:

Revenue. . . . . . . . . . . . $ 321,495 835,329 120,164 253,427

Costs and Expenses . . . . . . $1,195,369 1,153,304 272,076 298,704

Loss before Income Taxes . . . $ (873,874) (317,975) (151,912) (45,277)

Net Loss . . . . . . . . . . . $ (796,602) (448,746) (119,852) (84,810)

Net Loss per Share
of Common Stock. . . . . . . $ (.20) (.11) (.03) (.02)
</TABLE>

March 31, 1995 June 30, 1995
---------------- -------------------------------------

Actual Actual As Adjusted(1)
------ ------ --------------
<S> <C> <C> <C>

BALANCE SHEET DATA:

Net working capital (deficit). . . $(2,554,850) (2,637,549) (2,092,449)

Total assets . . . . . . . . . . . $ 1,557,322 1,496,801 2,041,901

Stockholders' deficit. . . . . . . $(2,007,281) (2,127,133) (1,582,033)
</TABLE>

<PAGE>

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

In the past, the Company's principal source of revenue has been from its
Prinos Interest. Payments to the Company under the Prinos Interest were
suspended in 1994 when the Company commenced legal action against Denison.
Prior to that time the revenues from the Prinos Interest varied. The
fluctuations in revenues in recent years are in part due to fluctuations in oil
prices. The average per barrel price for oil production underlying the Prinos
Interest was $12.38 and $15.65 for the years ended March 31, 1994 and 1993,
respectively.

Due to high Greek income taxes and royalties in combination with declining
production levels, low oil prices and increasing operating costs, the consortium
operating the Greek properties believed that the Greek operation was at its
economic breakeven point. As a result, Denison and its partners commenced
negotiations in 1992 with senior Greek government officials to obtain relief
from the high level of government taxes and royalties. On February 23, 1993,
the consortium reached an agreement with the Greek Government resulting in an
amendment to the License Agreement known as Law 98/1975 which regulates the
operation of the field. The amendment was ratified by the Greek Parliament on
June 23, 1993 and was retroactive to January 1, 1993.

In addition, the new law required Denison and its partners to spend $15
million during 1993 and 1994 on infill drilling in order to enhance the
recoverability of the hydrocarbons. In March 1994, the consortium announced the
discovery of a new oil field by the drilling of the Prinos North-2 well.
According to Denison's 1994 Annual Report, two oil bearing zones were flow
tested with a 30 meter upper section flowing at about 3,200 barrels per day and
a 7 meter lower section flowing at 150 barrels per day. Oil in place was
calculated at about 18 million barrels of which 5 million may be recoverable.
The crude from this discovery has an API gravity of about 25 degrees, contains
about 7% sulphur and may have a selling value of between $1.50 and $4.00 per
barrel less than Prinos crude. Recent discussions with Denison indicate that
the consortium is not considering development of Prinos North at this time.

Denison, who has the contractual obligation to pay the Company's Prinos
Interest, has asserted that the calculation of the amounts due the Company
should be based on the amended agreement with the Greek government. The Company
disagrees with this interpretation and has commenced legal action seeking a
declaration by the Court that amounts due the Company attributable to its Prinos
Interest be calculated based on the terms of the license agreement prior to the
1993 amendment. The Company is seeking damages of approximately $5,000,000 for
the

<PAGE>

period from January 1, 1993 through March 31, 1994 plus damages since that date
and undetermined future damages. SEE "LEGAL PROCEEDINGS."

The Company also receives revenues from sales of seismic data gathered in
its oil and gas exploration and development. That revenue is sporadic and is
not sufficient to fund the Company's ongoing operations. During the last
quarter of fiscal year 1995 and the first quarter of fiscal year 1996, the
Company recorded approximately $78,000 of revenue from the sale of seismic data.

The Company currently receives approximately $322,000 per year in
connection with services it renders to Cordillera Corporation and San Miguel
Valley Corporation pursuant to management agreements providing for reimbursement
of costs for actual time and expenses incurred in activities conducted on behalf
of those entities. The amounts received under the management agreements are a
reimbursement for employee salaries and other operating expenses. SEE "CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS."

Denison's suspension of the payments to the Company under the Prinos
Interest has resulted in the Company's inability to fulfill its financial
obligations as they become due and therefore the Company faces potential
insolvency. Accordingly, the Company's auditors have issued an opinion on the
Company's financial statements that includes an explanatory paragraph discussing
the uncertainty regarding the Company's ability to continue as a going concern.

On September 19, 1995, the Company entered into the Modification Agreement
with NWO. The Modification Agreement provides for limited funding of litigation
expenses and provides temporary relief from any collection actions by NWO. The
Modification Agreement does not provide any further funding for operating
expenses of the Company other than limited funding of the litigation with
Denison. SEE "BUSINESS OF THE COMPANY--NWO LINE OF CREDIT."

Future operations of the Company, reimbursements of advances for legal fees
in connection with the litigation of its Prinos Interest and funding the working
capital deficit as necessary will be funded by this Rights Offering. The
Company estimates that the funding provided from the Rights Offering will be
sufficient to fund the litigation with Denison through June 30, 1996, the date
prior to which the Company anticipates a judgment will be rendered in the
litigation, and to fund limited operations through December 1996. The working
capital deficit may also be funded as necessary and as funds are available. SEE
"USE OF PROCEEDS". Even if a judgment in the Company's favor is obtained, of
which there is no assurance, there is no guarantee that the Company would be
able to collect that judgment and, if able to collect, when the judgment would
be actually collected. Unless funds are collected as a result of the litigation
with Denison and the revenue stream is resumed under the Prinos Interest, the

<PAGE>

Company will be required to obtain some additional source of capital, in
addition to the Rights Offering described herein, to fund continuing operations
past December 1996 and pay off the NWO loan and accrued interest when due on
December 31, 1996.

If the judgment is not favorable, the Company would likely still have its
Prinos Interest, however, the revenue stream will likely be substantially
reduced. If Denison is successful in its counterclaim and obtains a judgment
against the Company, revenues from the Prinos Interest could be suspended and
applied to payment of the judgment. If such unfavorable outcome occurs, it is
uncertain as to whether the Company's revenue stream from its Prinos Interest
would be sufficient to pay off the NWO loan and accrued interest. The Company
may be forced to liquidate its assets, and in such case, little if any assets
will be available for distribution to shareholders.

If the litigation with Denison is resolved in the Company's favor and
payments are resumed under the Prinos Interest, that revenue should be
sufficient to fund on-going operations and limited new exploration activities.
All revenues from the Prinos Interest will be initially applied to repay the
Company's obligations to NWO under the Modification Agreement. SEE "BUSINESS OF
THE COMPANY--NWO LINE OF CREDIT." There is no assurance as to how long the
Prinos property will continue to produce oil and gas and, accordingly, how long
the Company can expect revenue from its Prinos Interest.

The financial statements do not include any adjustments that might result
from the uncertainties described above.

RESULTS OF OPERATIONS

The Company reported net losses of $796,602 and $448,746 for the years
ended March 31, 1995 and 1994, respectively, and net income of $1,511,343 for
the year ended March 31, 1993. The most significant factors in the fluctuations
of net income between the periods are lower revenues under the Prinos Interest
as the result of the position taken by Denison in the calculation of the Prinos
Interest, variances in oil and gas prices received, and the effect of normal
production declines from the Prinos and South Kavala fields in Greece. The
depletion provision decreased from $678,519 in 1993 to $244,630 for 1994, and
subsequently to $233,689 for 1995, reflecting the declining base of depletable
costs for the Greece concession.

The Company reported a loss before income taxes of $151,912 for the first
quarter of fiscal year 1996 compared to a loss before income taxes of $45,277
for the same period of fiscal year 1995. The increased loss before income taxes
is due to the suspension of revenues from the Prinos Interest offset by
approximately $36,700 in revenue from a non-recurring sale of seismic data.

The following table summarizes the primary components of changes in net
income before the provision for income taxes for the relevant periods:

<PAGE>

Quarter ended Year Ended March 31,
------------- ----------------------------------------

June 30, 1995 1995 1994 1993
------------- ---- ---- ----
<S> <C> <C> <C> <C>
Calculation of Greek
revenues $(183,333) (573,100) (3,377,000) (623,000)

Production decline - - (78,000) (1,315,000)

Price decrease - - (477,000) (115,000)

Reduction in
depreciation and
depletion charges 11,689 10,941 433,889 176,842

(Increase) reduction in
interest costs (17,658) (38,136) 43,741 200,211

Increase (reduction) in
other income 50,070 59,266 (182,000) -

Other 32,597 (14,870) (20,133) 65,220
--------- -------- --------- ---------

Decrease in income
before taxes $(106,635) (555,899) (3,656,503) (1,610,727)
--------- -------- --------- ----------
--------- -------- --------- ----------
</TABLE>

For the year ended March 31, 1995, other components of changes in net
income are the net effect of a decrease in exploration expenses and an increase
in general and administrative expenses.

The provision for income taxes in fiscal 1995 decreased approximately
$208,000 from the fiscal 1994 provision due to a decrease in Greek income taxes
corresponding to the decrease in Greek oil and gas revenues recorded.

DESCRIPTION OF CAPITAL STOCK

The Company's authorized capital stock consists of 12,000,000 shares of
Common Stock, par value $.0625 per share and 600,000 shares of Preferred Stock,
par value $10.00 per share. The relative rights of the Company's Common Stock
and Preferred Stock are defined by the Company's Articles of Incorporation, as
described below, as well as by the Company's Bylaws and the General Corporation
Law of the State of Delaware.

<PAGE>

COMMON STOCK

Subject to the rights of holders of any series of Preferred Stock which may
from time to time be issued, holders of Common Stock are entitled to one vote
per share on matters acted upon at any shareholders' meeting, including the
election of directors, and to dividends when, as and if declared by the Board of
Directors out of funds legally available therefor. There is no cumulative
voting and the Common Stock is not redeemable. In the event of any liquidation,
dissolution or winding up of the Company, each holder of Common Stock is
entitled to share ratably in all assets of the Company remaining after the
payment of liabilities and any amounts required to be paid to holders of
Preferred Stock, if any. Holders of Common Stock have no preemptive or
conversion rights and are not subject to further calls or assessments by the
Company. All shares of Common Stock now outstanding, and all shares to be
outstanding upon the completion of this Rights Offering, are and will be fully
paid and non-assessable.

The Common Stock is listed on The Pacific Stock Exchange as a Tier II
Security. As of August 25, 1995, there were approximately 493 holders of record
of Common Stock. This number was derived from the Company's shareholder
records, and does not include owners of the Company's Common Stock whose shares
are held in the names of various dealers, clearing agencies, banks, brokers, and
other fiduciaries. The Company believes that the number of beneficial owners of
Common Stock exceeds 550.

The Company has failed in several respects to maintain the minimum
requirements for maintaining its listing on the Pacific Stock Exchange. On
August 25, 1995, the Company was notified that it is subject to the initiation
of delisting procedures. Its listing status was reviewed by the Exchange at a
meeting of the Equity Listing Committee held on October 3, 1995. The Company
was informed that the Committee had decided to delist its Common Stock. The
Company had the right to appeal the decision of the Committee and the Company
intends to pursue such an appeal. The Company's Common Stock is suspended from
trading as of October 4, 1995 and will remain suspended until the appeals
process is completed. The potential delisting of the Company from the Pacific
Stock Exchange could have a negative effect on the market value of the
Company's Common Stock. See "RISK FACTORS--POTENTIAL DELISTING FROM THE
PACIFIC STOCK EXCHANGE."

PREFERRED STOCK

The Board of Directors of the Company, without further action by the
stockholders, is authorized to issue the shares of Preferred Stock in one or
more series and to determine the voting rights, preferences as to dividends, and
the liquidation, conversion, redemption and other rights of each series. The
issuance of a series with voting and conversion rights may adversely affect the
voting power of the holders of Common Stock. The issuance of Preferred Stock
may have the effect of delaying, deferring or preventing a change in control of
the Company without further action by the shareholders. The Company has no
present plans to issue any shares of Preferred Stock.

<PAGE>

TRANSFER AGENT

The Company's Transfer Agent is Chemical Mellon Shareholder Services, 300
South Grand Avenue, Los Angeles, California 90071-3401.

DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

The following table sets forth the names and ages of the members of the
Company's Board of Directors and its executive officers, and sets forth the
position with the Company held by each:

NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
James Neal Blue 60 Director; Chairman of the Board and Chief
Executive Officer of the Company

Charles N. Haas 57 Director and President of the Company

John L. Redmond 65 Director and Vice President, International Exploration
of the Company

Gene E. Burke, M.D. 66 Director

Sidney H. Stires 65 Director

Janet A. Holle 44 Vice President/Secretary of the Company

Diana J. Peters 38 Treasurer and Chief Financial Officer of the
Company
</TABLE>

Directors of the Company hold these positions until their respective
successors are elected and qualified. The current directors, except for John L.
Redmond, were elected in 1982 and no meeting of the stockholders has been held
since that date. Mr. Redmond was appointed in 1994 by the remaining directors
to fill a vacancy on the Board of Directors.

JAMES N. BLUE. Mr. Blue has been a director and officer of the Company
since 1981. He is also Chairman of General Atomics in San Diego, California and
President of Cordillera Corporation in Denver, Colorado.

CHARLES N. HAAS. Mr. Haas has been a director and officer of the Company
since 1981.

<PAGE>

JOHN L. REDMOND. Mr. Redmond has been a director of the Company since
1994. He has been Vice President, International Exploration of the Company
since 1990.

GENE E. BURKE, M.D.. Mr. Burke has been a director of the Company since
1972. He has been a physician in sole practice in Houston, Texas during that
time.

SIDNEY H. STIRES. Mr. Stires has been a director of the Company since
1980. During that time Mr. Stires has been the President of Stires & Co., Inc.,
an investment banking company in New York, NY.

JANET A. HOLLE. Ms. Holle has been an officer of the Company since 1987.

DIANA J. PETERS. Ms. Peters has been an officer of the Company since 1992.
From 1988 to 1992, Ms. Peters was a consultant with respect to accounting
issues.

EXECUTIVE COMPENSATION

The following information summarizes compensation paid by the Company to
James N. Blue, Chief Executive Officer and Charles N. Haas, President.

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>

Long Term Compensation
------------------------------------------
Annual Compensation Awards Payouts
---------------------------- --------------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
(a) (b) (c) (d) (e) (f) (g) (h) (i)

Other
Fiscal Annual Restricted
Name and Year Compen- Stock LTIP All other
Principal Ended Salary Bonus sation Award(s) Options/ Payouts Compensa-
Position March 31 ($) ($) ($) ($) SARs (#) ($) tion ($)
- -------- -------- ------- ------- ------- -------- -------- -------- ---------

James N. Blue 1995 - - 60,000 (1) - - - -
Chairman of 1994 - - 60,000 (1) - - - -
the Board and 1993 - - 60,000 (1) - - - -
Chief
Executive
Officer

Charles N. Haas
President 1995 158,762 (2) - - - - - 21,899 (2)(3)
1994 159,862 (2) - - - - - 20,766 (2)(3)
1993 161,789 (2) - - - - - 22,892 (2)(3)
</TABLE>

(1) Monthly officer's fee of $5,000.

<PAGE>

(2) A portion of the salary and other compensation paid to Mr. Haas has been
reimbursed based on cost sharing arrangements with other companies. SEE
"CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS--MANAGEMENT AGREEMENTS."

(3) The Company is a participant in the Cordillera and Affiliated Companies'
Money Purchase Pension Plan and 401(K) Plan, covering all qualified
employees of the Company. The pension plan is a non-contributory defined
contribution plan. Company contributions to this plan are based on 6% of
total compensation not exceeding the limit established annually for the
Federal Insurance Contribution Act (FICA) and 11.7% of compensation in
excess of this limit. Vesting begins after two years of service at a rate
of 20% annually with full vesting subsequent to five years of service or
upon retirement, death or permanent disability. The 401(K) plan provides
for discretionary employee contribution of up to 10% of annual pre-tax
earnings, subject to the maximum amount established annually under Section
401(K) of the Internal Revenue Code. The Company is required to match
contributions to the extent of 6% of annual employee compensation.
Employer contributions to the plan vest immediately.

Members of the Company's Board of Directors who are not employees of the
Company or any of its affiliates receive directors' fees of $500 per month.
Members of the Board of Directors who are employees do not receive directors'
fees. Mr. Blue receives a monthly fee of $5,000 for services as an officer of
the Company.

There are no employment contracts outstanding at this time. The Company
has a deferred compensation agreement with a former officer entitling this
officer to receive $175,000 payable in a maximum of ten equal installments
beginning January 1, 1988 or, if such person dies prior to receiving all
installments, payable at such time to his beneficiaries to the extent of the
remaining balance. Included in accrued expenses is $17,500 which is due January
1, 1996. The final installment of $17,500 is due January 1, 1997.

In fiscal 1983, the Board of Directors authorized a bonus of $25,000 to the
president of the Company, payable as cash flow permits. The president has not
been paid as of March 31, 1995, and the amount is included in accrued expenses
in the accompanying balance sheets.

The Company has no compensation committee. James N. Blue and Charles N.
Haas participated in all deliberations concerning executive officer
compensation.

SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

As of September 15, 1995 there were issued and outstanding 3,915,154 shares
of Common Stock and is the Company's only class of voting securities. Holders
of Common Stock are entitled to one vote per share on each matter upon which
shareholders may be entitled to vote.

The following table sets forth information regarding shares of Common Stock
of the Company beneficially owned as of September 15, 1995 by: (i) each person
known by the Company to beneficially own 5% or more of the outstanding Common
Stock, (ii) by each

<PAGE>

director (iii) by each person named in the summary compensation table and (iv)
by all officers and directors as a group.
<TABLE>
<CAPTION>

Name and Addresses of Officers, Amount of Percentage of
Directors and Principal Shareholders Common Stock Voting Securities
- ------------------------------------ ------------ -----------------
<S> <C> <C>
Allen & Company 824,200 21%
and various affiliates
711 Fifth Avenue
New York, NY 10022

International Hydrocarbons (1) 1,713,483 43.8%
c/o John E. Jones
5000 S. Quebec Street, Suite 450
Denver, CO 80237

International Cordillera Ltd. (2) 190,387 4.9%
c/o Vista International Bank and
Trust (Bahamas) Ltd.
West Bay Street
Nassau, Bahamas

James N. Blue (3) (4) None N/A
5000 S. Quebec St., Suite 450
Denver, CO 80237

Charles N. Haas (3) None N/A
5000 S. Quebec St., Suite 450
Denver, CO 80237

Sidney H. Stires (3) 34,000 less than 1%
432 Park Avenue South
New York, NY 10016

Gene E. Burke, M.D. (3) None N/A
3555 Timmons #680
Houston, TX 77027

John L. Redmond (3) None N/A
5000 S. Quebec St., Suite 450
Denver, CO 80237

All Directors and Officers 34,000 less than 1%
as a group (7 persons)
</TABLE>

<PAGE>

(1) International Hydrocarbons is a wholly-owned subsidiary of NWO. Mr. Blue
is president and a director of International Hydrocarbons. He is also
president and a director of NWO. Cordillera Corporation ("Cordillera"), of
which Mr. Blue is president and a major stockholder, and Mr. Blue
beneficially hold 60.667% of Class B common stock of NWO.

(2) International Cordillera Limited is a wholly-owned subsidiary of Western
International Technology Corporation. Western International Technology
Corporation is wholly owned by officers and employees of Cordillera other
than Mr. Blue.

(3) Director of the Company

(4) Does not include shares owned by International Hydrocarbons. International
Hydrocarbons is a wholly-owned subsidiary of NWO. Mr. Blue is president
and a director of both International Hydrocarbons and NWO. Cordillera, of
which Mr. Blue is president and a major stockholder, and Mr. Blue
beneficially hold 60.667% of Class B common stock of NWO.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

NWO LINE OF CREDIT

The Company has a $2,000,000 line of credit with NWO, the parent company of
International Hydrocarbons, the Company's principal stockholder. The line of
credit is secured by the Company's Prinos Interest. Prior to the end of fiscal
year 1995, the Company's credit line was exhausted. Currently the Company has
no resources to maintain interest payments under the line of credit.
Accordingly, the Company has entered into a Modification Agreement with NWO,
modifying the existing line of credit arrangement between the Company and NWO.
SEE "BUSINESS OF THE COMPANY--NWO LINE OF CREDIT." Cordillera is a stockholder
of NWO holding 60.667% of Class B common stock. Mr. Blue, the Chairman of the
Board and Chief Executive Officer of the Company, is president and a major
stockholder of Cordillera.

MANAGEMENT AGREEMENTS

The Company has a cost sharing arrangement under which it provides
management services to Cordillera and to San Miguel Valley Corporation (SMVC),
an affiliate of Cordillera, pursuant to agreements providing for reimbursement
of costs for actual time and expenses incurred on Cordillera and SMVC
activities. In 1995, 1994, and 1993, such reimbursements amount to
approximately $274,000, $231,000 and $287,000, respectively, which have been
included as other revenue in the accompanying statements of operations. Mr.
Blue, the Chairman of the Board and Chief Executive Officer of the Company, is
president and a major stockholder of Cordillera.

<PAGE>

OFFICER FEES

Mr. Blue receives officers' fees of $5,000 per month for his services as
Chairman of the Board and Chief Executive Officer of the Company. Mr. Blue is
president and a director of International Hydrocarbons, the Company's principal
stockholder, and its parent, NWO. Cordillera, of which Mr. Blue is president
and a major stockholder, and Mr. Blue beneficially hold 60.667% of Class B
common stock of NWO.

EMPLOYEE BENEFIT PLANS

Cordillera has a defined contribution pension plan covering all qualified
employees of the Company. Contributions to the plan are based on a percentage
of employee compensation ranging from 6% to 11.7%. During 1995, 1994, and 1993,
the Company recorded $27,038, $24,607, and $25,270, respectively, as pension
expense under this plan. Mr. Blue, the Chairman of the Board and Chief
Executive Officer of the Company, is president and a major stockholder of
Cordillera.

LEASE OF CORPORATE HEADQUARTERS

The Company leases 2,562 square feet of space in an office building located
at 5000 South Quebec Street, Denver, Colorado. The building is owned by
Sorrento West Properties, Inc., a company indirectly owned and controlled by Mr.
Blue, the Chairman of the Board and Chief Executive Officer of the Company, and
his family. Rent payments for 1995 were $32,998. Future lease payments are
estimated to be $27,000 for 1996 and $29,000 for 1997. These lease payments
include adjustments for the Company's proportionate share of operating expenses.
The Company believes that, with respect to the lease of its corporate
headquarters, it obtained terms no less favorable than what could have been
obtained from unrelated parties in arms-length transactions.

INDEMNIFICATION OF OFFICERS AND DIRECTORS

Under Sections 145 of the Delaware General Corporate Law and the Company's
Certificate of Incorporation, the Company's directors and officers may be
indemnified against certain liabilities which they may incur in their capacities
as such.

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions or otherwise, the Company has been advised
that in the opinion of the Commission, such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Company of expenses incurred or paid by a director, officer
or controlling person of the Company in the successful defense of any action,
suit or proceeding) is asserted

<PAGE>

by such director, officer or controlling person in connection with the
securities being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

RIGHTS AND LEGAL MATTERS

The validity of the Common Stock offered hereby will be passed upon for the
Company by Ballard Spahr Andrews & Ingersoll, Salt Lake City, Utah.

EXPERTS

The consolidated balance sheets of Oceanic Exploration Company and
subsidiaries as of March 31, 1995 and 1994 and the consolidated statements of
operations and accumulated deficit and cash flows for each of the years in the
three-year period ended March 31, 1995, have been included herein and in the
Registration Statement in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, appearing elsewhere herein, and upon
the authority of said firm as experts in accounting and auditing.

The report of KPMG Peat Marwick LLP covering the aforementioned financial
statements contains two explanatory paragraphs. The first explanatory paragraph
states that the Company's inability to generate sufficient cash flow to sustain
operations and service its debt raises substantial doubt about the Company's
ability to continue as a going concern. The consolidated financial statements
do not include any adjustments that might result from the outcome of this
uncertainty. The second explanatory paragraph states the Company has commenced
legal action in Canada seeking a declaration by the Court that amounts due the
Company attributable to its Prinos Interest be calculated based on the terms of
a license agreement with the Greek government before a recent amendment. The
working interest owner who has the contractual obligation to the Company for its
Prinos Interest has ceased remitting payments to the Company and has filed a
counterclaim. The ultimate outcome of this litigation cannot presently be
determined. Accordingly, no provision for any liability or loss that may result
upon adjudication has been recognized in the consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 1995 AND 1994

(WITH INDEPENDENT AUDITORS' REPORT THEREON)

<PAGE>

INDEPENDENT AUDITORS' REPORT

THE BOARD OF DIRECTORS AND STOCKHOLDERS
OCEANIC EXPLORATION COMPANY:

We have audited the accompanying consolidated balance sheets of Oceanic
Exploration Company and subsidiaries as of March 31, 1995 and 1994, and the
related consolidated statements of operations and accumulated deficit and cash
flows for each of the years in the three-year period ended March 31, 1995.
These consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion the consolidated financial statements referred to above present
fairly the financial position of Oceanic Exploration Company and subsidiaries as
of March 31, 1995 and 1994, and the results of their operations and their cash
flows for each of the years in the three-year period ended March 31, 1995 in
conformity with generally accepted accounting principles.

The accompanying consolidated financial statements have been prepared assuming
that Oceanic Exploration Company and subsidiaries will continue as a going
concern. As discussed in Note 1 to the consolidated financial statements, the
Company's inability to generate sufficient cash flow to sustain operations and
service its debt raises substantial doubt about the Company's ability to
continue as a going concern. Management's plans in regard to these matters are
also disclosed in Note 1. The consolidated financial statements do not include
any adjustments that might result from the outcome of this uncertainty.

As discussed in Note 3 to the consolidated financial statements, the Company has
commenced legal action in Canada seeking a declaration by the Court that amounts
due the Company attributable to its 15% net profits interest in an oil and gas
property offshore Greece be calculated based on the terms of a license
agreement with the Greek government before a recent amendment. The working
interest owner who has the contractual obligation to the Company for its 15% net
profits interest has ceased remitting payments to the Company and has filed a
counterclaim. The ultimate outcome of the litigation cannot presently be
determined. Accordingly, no provision for any liability or loss that may result
upon adjudication has been recognized in the accompanying consolidated financial
statements.

KPMG PEAT MARWICK LLP
Denver, Colorado
May 31, 1995

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

MARCH 31, 1995 AND 1994
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>

ASSETS 1995 1994
---- ----
<S> <C> <C>
Cash $ 154,628 48,928

Receivables:
Federal income tax -- 4,125
Affiliates 2,237 7,264
Other 9,633 777
---------- ---------
11,870 12,166

Prepaid expenses 4,347 2,235

Restricted cash 15,629 15,171
---------- ---------

Total current assets 186,474 78,500
---------- ---------

Oil and gas property interests, full-cost method
of accounting - Greece (note 2) 39,000,000 39,000,000
Less accumulated amortization, depreciation,
and valuation allowance (37,629,909) (37,396,220)
---------- ---------
1,370,091 1,603,780
---------- ---------

Other assets 757 1,325
---------- ---------
$ 1,557,322 1,683,605
---------- ---------
---------- ---------

(Continued)
</TABLE>

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS, CONTINUED

LIABILITIES AND STOCKHOLDERS' DEFICIT 1995 1994
---- ----
<S> <C> <C>
Current liabilities:
Notes payable to affiliate (notes 1 and 2) $ 2,000,000 --
Accounts payable 181,879 61,894
Accounts payable to affiliates 60,000 60,000
United Kingdom taxes payable, including
accrued interest 408,958 355,303
Accrued expenses (note 6) 90,487 103,303
------------ ------------
Total current liabilities 2,741,324 580,500
------------ ------------

Note payable to affiliate (note 2) -- 1,400,000

Deferred income taxes 808,062 885,334

Other noncurrent liabilities 15,217 28,450
------------ ------------

Total liabilities 3,564,603 2,894,284
------------ ------------

Stockholders' deficit (note 5):
Common stock, $.0625 par value. Authorized
12,000,000 shares; issued and outstanding
3,915,154 shares 244,697 244,697
Capital in excess of par value 6,665 6,665
Accumulated deficit (2,258,643) (1,462,041)
------------ ------------

Total stockholders' deficit (2,007,281) (1,210,679)
------------ ------------

Commitments and contingencies (notes 1, 3 and 6)
$ 1,557,322 1,683,605
------------ ------------
------------ ------------

</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT

YEARS ENDED MARCH 31, 1995, 1994, AND 1993
- -------------------------------------------------------------------------------

1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Revenue:
Oil and gas sales - Greece (note 3) $ -- 573,100 4,523,500
Other (note 6) 321,495 262,229 444,065
--------- ---------- ----------
321,495 835,329 4,967,565
--------- ---------- ----------
Costs and expenses:
Interest and financing costs 150,164 112,028 155,769
Exploration expenses 181,566 213,115 220,935
Amortization and depreciation 233,689 244,630 678,519
General and administrative 629,950 583,531 573,814
--------- ---------- ----------
1,195,369 1,153,304 1,629,037
--------- ---------- ----------
Income (loss) before income taxes (873,874) (317,975) 3,338,528

Income tax (benefit) expense (note 4) (77,272) 130,771 1,827,185
--------- ---------- ----------
Net income (loss) (796,602) (448,746) 1,511,343

Accumulated deficit at beginning of year (1,462,041) (1,013,295) (2,524,638)
--------- ---------- ----------
Accumulated deficit at end of year $(2,258,643) (1,462,041) (1,013,295)
--------- ---------- ----------
--------- ---------- ----------
Income (loss) per common share $(.20) (.11) .39
----- ------ -----
----- ------ -----
Number of common shares outstanding 3,915,154 3,915,154 3,915,154
--------- ---------- ----------
--------- ---------- ----------

</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED MARCH 31, 1995, 1994, AND 1993
- -------------------------------------------------------------------------------

1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $(796,602) (448,746) 1,511,343
Adjustments to reconcile net income (loss) to
net cash (used in) provided by operating
activities:
Amortization and depreciation 233,689 244,630 678,519
Deferred income tax benefit (77,272) (78,332) (425,000)
Decrease in receivables 296 23,699 17,257
(Increase) decrease in restricted cash (458) (280) 198,673
(Increase) decrease in prepaid expenses
and other assets (1,544) 456 442
Increase (decrease) in accounts payable 119,985 (304,487) 221,011
Decrease in accounts payable to
affiliates -- -- (172,432)
Increase (decrease) in United Kingdom
taxes payable, including accrued interest
payable, and accrued expenses 40,839 13,285 (36,828)
Decrease in other noncurrent liabilities (13,233) (11,506) (40,644)
--------- -------- ---------
Net cash (used in) provided by
operating activities (494,300) (561,281) 1,952,341
--------- -------- ---------
Cash flows from financing activities:
Principal payments on primary bank loan -- -- (2,002,534)
Borrowings from (repayments to) affiliate, net 600,000 (55,000) 650,000
--------- -------- ---------
Net cash provided by (used in)
financing activities 600,000 (55,000) (1,352,534)
--------- -------- ---------
Net increase (decrease) in cash 105,700 (616,281) 599,807

Cash at beginning of year 48,928 665,209 65,402
--------- -------- ---------

Cash at end of year $ 154,628 48,928 665,209
--------- -------- ---------
--------- -------- ---------

Interest paid $ 124,781 86,690 137,821
--------- -------- ---------
--------- -------- ---------

Federal income taxes paid (refunded) $ (4,125) (18,997) 6,686
--------- -------- ---------
--------- -------- ---------

Foreign income taxes paid $ -- 228,100 2,245,499
--------- -------- ---------
--------- -------- ---------
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 1995 AND 1994

- -------------------------------------------------------------------------------
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) GENERAL

Oceanic Exploration Company (the Company) is principally engaged in a
worldwide search for oil and gas reserves. The Company's investment
in oil and gas properties consists primarily of interests in proven
reserves offshore Greece. Substantially all production from the
offshore Greece property is sold 50% to the Greek national refinery
and 50% to BP-France based on prices determined by reference to
current world oil prices as specified by contracts signed by the
operator with both customers.

(b) GOING CONCERN BASIS OF PRESENTATION

The financial statements have been prepared on a going concern basis
which contemplates the realization of assets and the satisfaction of
liabilities and commitments in the normal course of business. Several
factors, described below, raise substantial doubt about the ability of
the Company to continue as a going concern.

Currently, the Company's operations are not generating sufficient cash
flow to fund operations and the Company's debt service. The Company
has been economically dependent upon NWO Resources, Inc. (NWO). NWO
is the parent corporation of the Company's majority stockholder,
International Hydrocarbons. The Company required financial assistance
from NWO during 1995 under a line of credit agreement (see note 2).

Through fiscal year 1995, NWO continued to advance funds to the
Company up to the limit of the line of credit agreement. NWO has no
obligation or commitment to provide further financial support and
recent discussions with NWO indicate that NWO is unwilling to extend
further financial assistance to the Company. As of May 31, 1995, the
Company is in default on the line of credit as it has not made its
interest payment for May 1995. Management has entered into
discussions with NWO with a view towards achieving an agreement which
would defer principal and interest payments and allow the Company to
finance its litigation costs and continue limited operations (see note
3). There can be no assurance that such an agreement can be reached
with NWO.

The Company will require additional funds to fund its litigation costs
and continue limited operations until the pending litigation is
completed or settled. Management is reviewing the Company's
activities and taking actions to reduce overhead costs. The Company
is also considering various options to fund its activities, which
include raising additional capital, borrowing additional funds, the
sale of assets, or a merger with another company. Obtaining the
additional financing may be difficult and there can be no assurances
that the Company will be successful in doing so.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
- -------------------------------------------------------------------------------
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Due to the uncertainties regarding the Company's ability to obtain
additional financing and reach an agreement with NWO to defer payments
due on its line of credit, there is substantial doubt about the
ability of the Company to continue as a going concern. The financial
statements do not include any adjustments that might result from the
outcome of this uncertainty.

The consolidated financial statements include the accounts of the
Company and its wholly owned domestic and foreign subsidiaries. All
significant intercompany balances and transactions have been
eliminated in consolidation.

(d) OIL AND GAS PROPERTIES

Oil and gas properties are accounted for using the full-cost method of
accounting in accordance with the rules prescribed by the Securities
and Exchange Commission (SEC). Under this method, all acquisition,
exploration, and development costs are capitalized on a country-by-
country basis as incurred. Gains or losses on disposition of oil and
gas properties are recognized only when such dispositions involve
significant reserves within the individual country cost pools.

Capitalized costs less related accumulated amortization may not exceed
the sum of (1) the present value of future net revenue from estimated
production of proved oil and gas reserves, computed using current
prices and costs and a discount rate of 10%; plus (2) the cost of
properties not being amortized, if any; plus (3) the lower of cost or
fair value of unproved properties included in costs being amortized;
less (4) income tax effects related to differences in the book and tax
basis of oil and gas properties.

The Company's offshore Greece oil and gas property interests represent
a 15% net profits interest in such properties. Accordingly, depletion
of oil and gas properties is computed using the future net revenue
method. Depletion expense for 1995 and 1994 has been calculated based
on the Company's estimate of the revenue due for its net profits
interest, calculated in a manner consistent with the terms of the
amended license agreement (see note 3).

Because the Company's interest in the offshore Greece oil and gas
property is a net profits interest and not a working interest, the
Company is only entitled to receive information regarding current
monthly production quantities and net revenue. Consequently, certain
reserve information regarding the operations of the property is
unavailable to the Company.

The cost of undeveloped properties is excluded from amortization
pending a determination of the existence of proved reserves. Such
undeveloped properties are assessed periodically for impairment. The
amount of impairment, if any, is added to the costs to be amortized.
At March 31, 1995 and 1994, all capitalized costs were subject to
amortization.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

- -------------------------------------------------------------------------------

(e) INCOME TAXES

The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME TAXES.
Under the asset and liability method of Statement 109, deferred tax
assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying
amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled.
Under Statement 109, the effect on deferred tax assets and liabilities
of a change in tax rates is recognized in operations in the period
that includes the enactment date.

Effective April 1, 1993, the Company adopted Statement 109 and has
reported no effect for this change in the method of accounting for
income taxes.

(f) INCOME (LOSS) PER SHARE

Income (loss) per share is based on the number of common shares
outstanding for the period.

(g) RECLASSIFICATIONS

Certain amounts for 1994 have been reclassified to conform to the 1995
presentation.

(2) NOTES PAYABLE

Notes payable to affiliate represents borrowings under a line of
credit with NWO. The NWO line of credit provides for cumulative draws
of up to $2,000,000 with interest payable monthly on the outstanding
principal balance at the greater of the U.S. bank prime lending rate
or 1 3/4% above the 30-day LIBOR. Borrowings under the line of credit
are secured by the Company's 15% net profits interest in the offshore
Greece oil and gas property. The borrowings are secured by promissory
notes payable no later than January 1, 1996. As of May 31, 1995, the
Company is in default of the line of credit as it has not made its
interest payment for May 1995.

(3) OIL AND GAS SALES - GREECE

Effective January 1, 1993, the operator of the Greek properties
negotiated an agreement with the Greek government which amended the
original license agreement. The amendment provides for a sliding
scale for calculating the operator's recoverable costs and expenses
and for the calculation of the Greek royalty interest. The working
interest owner who has the contractual obligation to the Company for
the 15% net profits interest has asserted that the calculation of the
amounts due to the Company should be based on the amended agreement
with the Greek government. The Company disagrees with this
interpretation and has commenced a legal action in Canada seeking a
declaration by the Court that amounts due the Company attributable to
its 15% net profits interest be calculated based on the terms of the

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

- -------------------------------------------------------------------------------

license agreement before this amendment. The Company is seeking
damages of approximately $5,000,000 for the period from January 1,
1993 through March 31, 1994 plus undetermined future damages. While
the Company believes it has a reasonable possibility of prevailing in
its action, the ultimate outcome of the matter cannot presently be
determined. Accordingly, no amounts have been recorded in the
accompanying financial statements for current revenues or damages,
if any, that may ultimately be awarded to the Company.

In response to the legal action commenced by the Company, the working
interest owner has ceased remitting payments to the Company and has
filed a counteraction seeking damages in the amount of $4,800,000 plus
interest and costs, alleging the Company was overpaid for the period
January 1, 1989 through December 31, 1993. As the working interest
owner has ceased remitting payments to the Company for its 15% net
profits interest, the Company has not recorded any revenues for Greece
for the current year. While the Company also believes that it will
prevail on the counterclaim, the ultimate outcome of that matter
likewise cannot be determined. Accordingly, no provision for any
liability or loss that may result upon final resolution of the
counterclaim has been recognized in the financial statements.

(4) INCOME TAXES

Income tax expense (benefit) consists of the following:
<TABLE>
<CAPTION>

YEAR ENDED MARCH 31
-------------------------------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Current:
Foreign - Greece $ -- 228,100 2,245,499
U.S. federal -- (18,997) 6,686
--------- ------- ----------
Total current income tax expense -- 209,103 2,252,185
--------- ------- ----------
Deferred:
Foreign - Greece (93,476) (97,852) (450,465)
U.S. federal 16,204 19,520 25,465
--------- ------- ----------
Total deferred income tax benefit (77,272) (78,332) (425,000)
--------- ------- ----------

Total income tax (benefit) expense $(77,272) 130,771 1,827,185
--------- ------- ----------
--------- ------- ----------

</TABLE>

9
<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

- -------------------------------------------------------------------------------

The reconciliation between tax expense computed by multiplying pretax
income by the U.S. federal statutory tax rate of 34% and the reported
amount of income tax expense is as follows:

Year ended March 31

1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Computed at U.S. statutory tax rate $ -- -- 1,135,100
Foreign - Greek income taxes, net (93,476) 130,248 1,795,034
Tax credit for Greek income taxes -- -- (1,081,906)
Other, net 16,204 523 (21,043)
--------- --------- ----------
Income tax expense $(77,272) 130,771 1,827,185
--------- --------- ----------
--------- --------- ----------

</TABLE>

Greek income taxes are withheld from oil and gas revenue payments to
the Company. The effective Greek income tax rate applicable to the
Company's 15% net profits interest was reduced from 50% to 40%
effective January 1, 1993 with respect to existing development areas.
The 50% tax rate remains effective for areas outside the current
development area.

Temporary differences between the financial statement carrying amounts
and tax bases of assets and liabilities that give rise to the deferred
tax liability at March 31, 1995 and 1994 relate to the Greece oil and
gas property interest.

(5) STOCK OPTIONS AND GRANTS

The Company adopted an incentive plan in June 1976 which reserved
500,000 shares of common stock for stock options and 200,000 shares
for stock grants to be awarded to Company officers, directors, and
employees, including certain eligible consultants. At March 31, 1995,
no stock options or grants were outstanding. At that date, 223,500
shares were available for future stock option awards and 115,626
shares were available for future grants.

(6) RELATED PARTY TRANSACTIONS

The Company provides management services under a cost sharing
arrangement to Cordillera Corporation (Cordillera), the beneficial
controlling shareholders of the Company, and to San Miguel Valley
Corporation (SMVC), an affiliate of Cordillera, under agreements
providing for reimbursement of costs for actual time and expenses
incurred on Cordillera and SMVC activities. In 1995, 1994, and 1993,
such reimbursements amounted to approximately $274,000, $231,000, and
$287,000, respectively, which have been included as other revenue in
the accompanying statements of operations.

Cordillera has a defined contribution pension plan covering all
qualified employees of the Company. Contributions to the plan are
based on a percentage of employee compensation ranging from 6% to
11.7%. During 1995, 1994, and 1993, the Company recorded $27,038,
$24,607, and $25,270, respectively, as pension expense under this
plan.

<PAGE>

OCEANIC EXPLORATION COMPANY
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

- -------------------------------------------------------------------------------

(6) RELATED PARTY TRANSACTIONS (CONTINUED)

The Company has a deferred compensation agreement with a former
officer entitling this officer to receive $175,000 payable in a
maximum of ten equal installments beginning January 1, 1988 or, if
such person dies prior to receiving all installments, payable at such
time to his beneficiaries to the extent of the remaining balance.
Included in accrued expenses is $17,500 which is due January 1, 1996.

In fiscal 1983, the Board of Directors authorized a bonus of $25,000
to the president of the Company, payable as cash flow permits. The
president has not been paid as of March 31, 1995, and the amount is
included in accrued expenses in the accompanying balance sheets.

The Company leases 2,562 square feet of space in an office building
owned by Sorrento West Properties, Inc., a company indirectly owned
and controlled by an officer and director of the Company. Rent
payments were $32,998 for 1995 and $32,152 for 1994. Future minimum
lease payments are $27,000 for 1996 and $29,000 for 1997.

<PAGE>

FINANCIAL STATEMENTS - FOR THE QUARTERLY PERIOD
ENDED JUNE 30, 1995

OCEANIC EXPLORATION COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

ASSETS

June 30, March 31,
1995 1995
----------- -----------
<S> <C> <C>
Cash $ 190,174 154,628
Receivables:
Affiliates 3,439 2,237
Other -- 9,633
----------- -----------
3,439 11,870

Prepaid expenses 982 4,347

Restricted cash -- 15,629
----------- -----------

Total current assets 194,595 186,474
----------- -----------

Oil and gas property
interests, full-cost method
of accounting -- Greece 39,000,000 39,000,000

Less accumulated amortization,
depreciation and
valuation allowance (37,698,409) (37,629,909)
----------- -----------
1,301,591 1,370,091
----------- -----------

Other assets 615 757
----------- -----------

$ 1,496,801 1,557,322
----------- -----------
----------- -----------
</TABLE>

(Continued)

<PAGE>

OCEANIC EXPLORATION COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS, CONTINUED
(UNAUDITED)
<TABLE>
<CAPTION>

LIABILITIES AND
STOCKHOLDER'S DEFICIT

June 30, March 31,
1995 1995
----------- -----------
<S> <C> <C>
Current liabilities:
Notes payable to affiliate (note 2) $ 2,000,000 2,000,000
Accounts payable 232,803 181,879
Accounts payable to affiliates 60,000 60,000
United Kingdom taxes payable,
including accrued interest 408,958 408,958
Accrued expenses 130,383 90,487
----------- -----------

Total current liabilities 2,832,144 2,741,324
----------- -----------

Deferred income taxes (note 4) 776,002 808,062

Other noncurrent liabilities 15,788 15,217
----------- -----------
Total liabilities 3,623,934 3,564,603
----------- -----------

Stockholders' deficit:
Common stock, $.0625 par value.
Authorized 12,000,000 shares;
issued and outstanding
3,915,154 shares 244,697 244,697
Capital in excess of par value 6,665 6,665
Accumulated deficit (2,378,495) (2,258,643)
----------- -----------

Total stockholders' deficit (2,127,133) (2,007,281)
----------- -----------
Contingencies (note 3)
$ 1,496,801 1,557,322
----------- -----------
----------- -----------
</TABLE>
See accompanying notes to consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
June 30,
-----------------------------
1995 1994
-----------------------------
<S> <C> <C>
Revenues:
Oil and gas sales - Greece (note 3) $ -- 183,333
Other 120,164 70,094
-------- --------
120,164 253,427
-------- --------
Costs and expenses:
Interest and financing costs 45,222 27,564
Exploration expenses 14,601 38,479
Amortization and depreciation 68,500 80,189
General and administrative 143,753 152,472
-------- --------
272,076 298,704
-------- --------

Loss before income taxes (151,912) (45,277)

Provision for income taxes (note 4) (32,060) 39,533
-------- --------

Net loss $(119,852) (84,810)
-------- --------
-------- --------
Loss per common share $ (.03) (0.02)
-------- --------
-------- --------
</TABLE>
See accompanying notes to consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>

Three Months Ended
June 30,
--------------------------
1995 1994
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (119,852) (84,810)

Adjustments to reconcile net loss
to net cash provided by (used in)
operating activities:
Amortization and depreciation 68,500 80,189
Deferred income tax benefit (32,060) (33,800)
Decrease (increase) in
receivables 8,431 (103,585)
Decrease (increase) in
restricted cash 15,629 (87)
Decrease in prepaid expenses
and other assets 3,507 936
Increase in accounts payable 50,924 2,565
Increase (decrease) in accrued
expenses 39,896 (13,092)
Increase in other noncurrent
liabilities 571 1,067
--------- ---------

Net cash provided by (used in)
operating activities 35,546 (150,617)
--------- ---------

Cash flows from financing activities:
Borrowings from affiliates -- 200,000
--------- ---------

Net cash provided by financing
activities -- 200,000
--------- ---------
Net increase in cash 35,546 49,383

Cash at beginning of period 154,628 48,928
--------- ---------

Cash at end of period $ 190,174 98,311
--------- ---------
--------- ---------
</TABLE>
See accompanying notes to consolidated financial statements.

<PAGE>

OCEANIC EXPLORATION COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 1995

(UNAUDITED)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION
The consolidated balance sheet as of March 31, 1995, which has been derived
from audited statements, and the unaudited interim consolidated financial
statements included herein have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
note disclosures normally included in annual financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to those rules and regulations, although the Company believes
that the disclosures made are adequate to make the information presented not
misleading. In the opinion of management, all adjustments consisting of normal
reoccurring accruals have been made which are necessary for the fair
presentation of the periods presented. The accounting policies of the Company
are set forth in the financial statements and notes thereto and are included in
the Company's latest annual report on Form 10-KSB. It is suggested that these
consolidated financial statements be read in conjunction with that document.

(2) NOTES PAYABLE

Notes payable to affiliate at June 30 and March 31, 1995 represent
borrowings under a $2,000,000 line of credit established in favor of the Company
by NWO Resources, Inc. (NWO) (an affiliate). The NWO line of credit, which
expires January 1, 1996, provides for cumulative draws of up to $2,000,000 with
interest payable monthly on the outstanding principal balance at the greater of
the U.S. bank prime lending rate or 1 3/4% above the 30-day LIBOR. Borrowings
under the line of credit are secured by the Company's 15% net profits interest
in the offshore Greece oil and gas properties. As of August 10, 1995, the
Company is in default on the line of credit as it has not made its interest
payments for May, June and July 1995.

(3) OIL AND GAS SALES - GREECE

Effective January 1, 1993, the operator of the Greek properties negotiated
an agreement with the Greek government which amended the original license
agreement. The amendment provides for a sliding scale for calculating the
operator's recoverable costs and expenses and for the calculation of the Greek
royalty interest. The working interest owner who has the contractual obligation
to the Company for the 15% net profits interest has asserted that the
calculation of the amounts due to the Company should be based on the amended
agreement with the Greek government. The Company disagrees with this
interpretation and has commenced a legal action in Canada seeking a declaration
by the Court that amounts due the

<PAGE>

Company attributable to its 15% net profits interest be calculated based on the
terms of the license agreement before this amendment. The Company is seeking
damages of approximately $5,000,000 for the period from January 1, 1993 through
March 31, 1994 plus undetermined future damages. While the Company believes it
has a reasonable possibility of prevailing in the litigation, the ultimate
outcome of the matter cannot presently be determined. Accordingly, no amounts
have been recorded in the accompanying financial statements for current revenues
or damages, if any, that may ultimately be awarded to the Company.

In response to the legal action commenced by the Company, the working
interest owner has ceased remitting payments to the Company and has filed a
counteraction seeking damages in the amount of $4,800,000 plus interest and
costs, alleging the Company was overpaid for the period January 1, 1989 through
December 31, 1993. As the working interest owner has ceased remitting payments
to the Company for its 15% net profits interest, the Company has not recorded
any revenues for Greece for the year ended March 31, 1995 or for the quarter
ended June 30, 1995. A revenue accrual had been made for the quarter ended June
30, 1994 but was subsequently reversed in the financial statements for the year
ended March 31, 1995. While the Company also believes that it will prevail on
the counterclaim, the ultimate outcome of that matter likewise cannot be
determined. Accordingly, no provision for any liability or loss that may result
upon final resolution of the counterclaim has been recognized in the financial
statements.

(4) INCOME TAXES

Income tax expense (benefit) consists of the following:

Three Months Ended

June 30, June 30,
---------------------------
1995 1994
-------- --------
<S> <C> <C>
Current:
Foreign - Greece $ -- 73,333
-------- --------

Total current -- 73,333
-------- --------

Deferred:
Foreign - Greece (32,060) (33,800)
-------- --------

Total deferred (32,060) (33,800)
-------- --------

Total income tax
expense (benefit) $ (32,060) 39,533
-------- --------
-------- --------
</TABLE>

<PAGE>

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

NO PERSON IS AUTHORIZED TO GIVE ANY RIGHTS OFFERING INFORMATION OR TO MAKE
ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN
THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES
OTHER THAN THE COMMON SHARES OFFERED BY THIS PROSPECTUS. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY COMMON
SHARES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED
BY REFERENCE HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.

___________________

TABLE OF CONTENTS

PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
AVAILABLE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
RIGHTS OFFERING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
DETERMINATION OF OFFERING PRICE. . . . . . . . . . . . . . . . . . . . . . . 13
BUSINESS OF THE COMPANY. . . . . . . . . . . . . . . . . . . . . . . . . . . 13
LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
MARKET FOR COMMON EQUITY . . . . . . . . . . . . . . . . . . . . . . . . . . 21
CAPITALIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
DIVIDENDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
AVAILABILITY OF OIL AND GAS RESERVE
INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
OIL AND GAS REVENUE AND COST
INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SELECTED FINANCIAL DATA. . . . . . . . . . . . . . . . . . . . . . . . . . . 24
MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND
RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
DESCRIPTION OF CAPITAL STOCK . . . . . . . . . . . . . . . . . . . . . . . . 28
DIRECTORS AND EXECUTIVE OFFICERS OF
THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
EXECUTIVE COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . 32
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
INDEMNIFICATION OF OFFICERS AND
DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
RIGHTS AND LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . 36
EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

-----------------------------
-----------------------------

RIGHTS OFFERING

6,001,000 Shares

OCEANIC EXPLORATION COMPANY

Common Stock

$.0625 par value

--------------------

PROSPECTUS

--------------------

October 6, 1995

<PAGE>

PART II - INFORMATION NOT REQUIRED IN PROSPECTUS

Item 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS
------------------------------------------

Section 145 of the General Corporation Law of the State of Delaware
provides that a corporation may indemnify its officers, directors, employees and
agents (or persons who have served, at the corporation's request, as officers,
directors, employees or agents of another corporation) against the expenses,
including attorneys' fees, actually and reasonably incurred by them in
connection with the defense of any action by reason of being or having been
directors, officers, employees or agents, if such person shall have acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation, and with respect to any criminal action or
proceedings, had no reason to believe his conduct was unlawful, except that if
such action shall be in the right of the corporation, no such indemnification
shall be provided as to any claim, issue or matter as to which such person shall
have been adjudged to have been liable to the corporation unless and only to the
extent that the Court of Chancery of the State of Delaware, or any other court
in which the suit was brought, shall determine upon application that, in view of
all the circumstances of the case, such person is fairly and reasonably entitled
to indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.

The Company's Bylaws provide that the Company shall indemnify its officers
and directors to the fullest extent permitted by the Delaware Law.

Insofar as indemnification for liabilities under the Securities Act of 1933
may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, the Company has been informed that in the
opinion of the Commission, such indemnification is against public policy as
expressed in the Act and is therefore unenforceable.

Item 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
--------------------------------------------

The estimated expenses in connection with this Rights Offering, other than
underwriting discounts and commissions, are set forth below:

Securities and Exchange Commission filing fee . . . . . . . . . . . .$ 207
Blue Sky fees and expenses. . . . . . . . . . . . . . . . . . . . . . 1,000
Accounting fees and expenses. . . . . . . . . . . . . . . . . . . . .15,000
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . . . .30,000
Transfer agent and registrar fees and expenses. . . . . . . . . . . . 1,000
Printing and electronic transmission expenses . . . . . . . . . . . . 4,700
Postage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,093
------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . .$55,000
-------
-------

II-1

<PAGE>

Item 26. RECENT SALES OF UNREGISTERED SECURITIES
---------------------------------------

The Company has not sold any securities within the past three years without
registration under the Securities Act of 1933.

II-2

<PAGE>

Item 27. EXHIBITS
--------

Exhibit Number
- ---------------

4 Form of Subscription Agreement.*

5 Opinion of Ballard Spahr Andrews & Ingersoll.*

3.1 Restated Certificate of Incorporation of Oceanic Exploration Company,
filed August 4, 1969.(1)

3.2 Certificate of Increase, filed July 26, 1971.(1)

3.3 Certificate of Amendment, filed July 26, 1971.(1)

3.4 Certificate of Correction, filed August 20, 1971.(1)

3.5 Second Certificate of Correction, filed February 22, 1972.(1)

3.6 Certificate of Amendment, filed February 22, 1972.(1)

3.7 Certificate of Determination of Preferences, dated April 27, 1972.(1)

3.8 Tenth Amended Bylaws of Oceanic Exploration Company adopted by the Board
of Directors on November 6, 1981.(2)

10.1 Memorandum of Agreement dated June 30, 1976 between Oceanic Exploration
Company and Denison Mines Limited.(3)

10.2 Letter Agreement dated July 28, 1976 amending Agreement of June 30,
1976.(3)

- --------------------
* Attached hereto.

(1) This exhibit is incorporated by reference to the exhibits filed with
respect to the Company's Report on Form 10-K for the period ended
September 30, 1980.

(2) This exhibit is incorporated by reference to the exhibits filed with
respect to the Company's Form 8 (Amendment No. 1 to Report on Form 10-K
for the period ended September 30, 1981,) dated June 1, 1982.

(3) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-K for the period ended
September 30, 1976.

II-3

<PAGE>

Exhibit Number
- --------------

10.3 Memorandum of Agreement, dated August 27, 1976 amending Agreement of June
30, 1976.(3)

10.4 Oil Payment and Net Earnings Interest Agreement, dated August 30, 1976.*

10.5 Farm-out Agreement with Enterprise Oil Exploration Limited and NMX
Resources (Overseas) Limited dated September 22, 1989.(4)

10.6 Letter Agreement with Enterprise Oil Exploration Limited and NMX
Resources (Overseas) Limited dated September 22, 1989.(4)

10.7 Letter of Indemnification with Enterprise Oil Exploration Limited and NMX
Resources (Overseas) Limited dated September 22, 1989.(4)

10.8 Agreement for Study and Petroleum Evaluation of the South East Area of
Bolivia, dated May 11, 1992.*

10.9 Management Agreement with Cordillera Corporation dated January 1,
1990.(4)

10.10 Management Agreement with San Miguel Valley Corporation dated January 1,
1990.(4)

10.11 Office Building Lease with Sorrento West Properties, Inc. dated March 1,
1991.(4)

10.12 Addendum to Office Building Lease dated March 1, 1994.(4)

10.13 Promissory Note with NWO dated June 15, 1994.(4)

10.14 Promissory Note with NWO dated July 18, 1994.(4)

10.15 Security Agreement in favor of NWO dated July 27, 1994.(4)

- --------------------
* Attached hereto.

(3) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-K for the period ended
September 30, 1976.

(4) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-KSB for the period ended
March 31, 1995.

II-4

<PAGE>

Exhibit Number
- --------------

10.16 Promissory Note with NWO dated September 22, 1994.(4)

10.17 Promissory Note with NWO dated December 15, 1994.(4)

10.18 Promissory Note with NWO dated January 1, 1995.(4)

10.19 Promissory Note with NWO dated February 15, 1995.(4)

10.20 Modification Agreement with NWO dated September 19, 1995.*

10.21 First Amendment to Security Agreement with NWO dated September 19, 1995.*

10.22 Letter dated August 22, 1995 from International Hydrocarbons regarding
purchase of unsubscribed stock in rights offering.*

23.1 Consent of KPMG Peat Marwick LLP.*

24.2 Consent of Ballard Spahr Andrews & Ingersoll (included in its opinion
filed as Exhibit 5).

24 Power of Attorney (included on signature pages to this Registration
Statement).

- ------------------
* Attached hereto.

(4) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-KSB for the period ended
March 31, 1995.

II-5

<PAGE>

Item 28. UNDERTAKINGS
------------

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors, officers and
controlling persons of the registrant pursuant to its Certificate of
Incorporation, as amended, its Bylaws, as amended or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable.

In the event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrant pursuant to
Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed
to be part of this registration statement as of the time it was declared
effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.

II-6

<PAGE>

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Denver, State of Colorado, on October 6, 1995.

OCEANIC EXPLORATION COMPANY

By: /s/ Charles N. Haas
---------------------------
Charles N. Haas
President

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Charles N. Haas and Diana J. Peters and
each or any one of them, his true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this registration statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or his or their substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date stated.

<PAGE>

Signature Title Date
- --------- ----- ----

/s/ Charles N. Haas President and October 5, 1995
- ------------------------------ Director
(Principal
Executive Officer)

/s/ Diana J. Peters Treasurer (Principal October 6, 1995
- ------------------------------ Financial Officer and
Diana J. Peters Principal Accounting
Officer)

/s/ James N. Blue Chairman of the October 3, 1995
- ------------------------------ Board of Directors
James N. Blue and Chief Executive
Officer

/s/ John L. Redmond Vice President - October 3, 1995
- ------------------------------ International
John L. Redmond Exploration and
Director

/s/ Sidney H. Stires Director October 3, 1995
- ------------------------------
Sidney H. Stires

/s/ Gene E. Burke, M.D. Director October 2, 1995
- ------------------------------
Gene E. Burke, M.D.

<PAGE>

EXHIBIT INDEX

Exhibit
Number Description of Exhibit
- ------ ----------------------

4 Form of Subscription Agreement.*

5 Opinion of Ballard Spahr Andrews & Ingersoll.*

3.1 Restated Certificate of Incorporation of Oceanic Exploration Company,
filed August 4, 1969.(1)

3.2 Certificate of Increase, filed July 26, 1971.(1)

3.3 Certificate of Amendment, filed July 26, 1971.(1)

3.4 Certificate of Correction, filed August 20, 1971.(1)

3.5 Second Certificate of Correction, filed February 22, 1972.(1)

3.6 Certificate of Amendment, filed February 22, 1972.(1)

3.7 Certificate of Determination of Preferences, dated April 27, 1972.(1)

3.89 Tenth Amended Bylaws of Oceanic Exploration Company adopted
by the Board of Directors on November 6, 1981.(2)

10.1 Memorandum of Agreement dated June 30, 1976 between
Oceanic Exploration Company and Denison Mines Limited.(3)

- ------------
* Attached hereto.

(1) This exhibit is incorporated by reference to the exhibits filed with
respect to the Company's Report on Form 10-K for the period ended
September 30, 1980.

(3) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-K for the period ended
September 30, 1976.

<PAGE>

Exhibit
Number Description of Exhibit
- ------ ----------------------

10.2 Letter Agreement dated July 28, 1976 amending Agreement
of June 30, 1976.(3)

10.3 Memorandum of Agreement, dated August 27, 1976
amending Agreement of June 30, 1976.(3)

10.4 Oil Payment and Net Earnings Interest Agreement,
dated August 30, 1976.*

10.5 Farm-out Agreement with Enterprise Oil Exploration Limited
and NMX Resources (Overseas) Limited dated
September 22, 1989.(4)

10.6 Letter Agreement with Enterprise Oil Exploration Limited
and NMX Resources (Overseas) Limited dated
September 22, 1989.(4)

10.7 Letter of Indemnification with Enterprise Oil Exploration
Limited and NMX Resources (Overseas) Limited dated
September 22, 1989.(4)

10.8 Agreement for Study and Petroleum Evaluation of the
South East Area of Bolivia, dated May 11, 1992.*

10.9 Management Agreement with Cordillera Corporation
dated January 1, 1990.(4)

10.10 Management Agreement with San Miguel Valley Corporation
dated January 1, 1990.(4)

10.11 Office Building Lease with Sorrento West Properties, Inc.
dated March 1, 1991.(4)
- ---------------------
* Attached hereto.

(3) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-K for the period ended
September 30, 1976.

(4) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-KSB for the period ended
March 31, 1995.

<PAGE>

Exhibit
Number Description of Exhibit
- ------ ----------------------

10.12 Addendum to Office Building Lease dated March 1, 1994.(4)

10.13 Promissory Note with NWO dated
June 15, 1994.(4)

10.14 Promissory Note with NWO dated
July 18, 1994.(4)

10.15 Security Agreement in favor of NWO
dated July 27, 1994.(4)

10.16 Promissory Note with NWO
dated September 22, 1994.(4)

10.17 Promissory Note with NWO
dated December 15, 1994.(4)

10.18 Promissory Note with NWO
dated January 1, 1995.(4)

10.19 Promissory Note with NWO
dated February 15, 1995.(4)

10.20 Modification Agreement with NWO
dated September 19, 1995.*

10.21 First Amendment to Security Agreement with NWO
dated September 19, 1995.*

10.22 Letter dated August 22, 1995 from International
Hydrocarbons regarding purchase of unsubscribed
stock in rights offering.*

- ---------------------
* Attached hereto.

(4) This exhibit is incorporated herein by reference to the exhibits filed
with respect to the Company's Report on Form 10-KSB for the period ended
March 31, 1995.

<PAGE>

Exhibit
Number Description of Exhibit
- ------ ----------------------

23.1 Consent of KPMG Peat Marwick LLP.*

24.2 Consent of Ballard Spahr Andrews & Ingersoll (included
in its opinion filed as Exhibit 5).

24 Power of Attorney (included on signature pages to
this Registration Statement).

- ------------

* Attached hereto.

<PAGE>

Exhibit 4
PLEASE CAREFULLY REVIEW THE INSTRUCTIONS

OCEANIC EXPLORATION COMPANY

SUBSCRIPTION AGREEMENT

This Subscription Agreement represents a subscription to acquire the number
of shares of Common Stock of Oceanic Exploration Company ("Common Stock") set
forth below at a subscription price of $.10 per share for the total subscription
price set forth below. The registered owner named below is entitled to
subscribe for full shares of Common Stock pursuant to subscription rights
granted to stockholders upon the terms and conditions set forth in the related
Prospectus. For each share of Common Stock subscribed for the subscription
price of $.10 must be forwarded to Oceanic Exploration Company.

THE SUBSCRIPTION RIGHTS EXPIRE AT 5:00 P.M. DENVER, COLORADO TIME ON
____________, 1995. NO SUBSCRIPTION AGREEMENT WILL BE ACCEPTED THEREAFTER.

Stockholder Name: _______________________________

Stockholder Address: _____________________________

Number of Shares Owned By
Stockholder on ________, 1995: ___________________

Number of Shares Subject To
Basic Subscription Rights: _______________________

SECTION 1 - SUBSCRIPTION AND SIGNATURE

I hereby irrevocably subscribe for the number of shares of Common Stock as
indicated below, on the terms specified in the related Prospectus.

a. Subscription: ___________ Shares
b. Over-Subscription: ________ Shares
(no more than 6,001,000 less the number
subscribed for in (a))
c. Total Subscription (a + b): __________ Shares
d. Total Cost (c x $.10): $__________

Signature of Telephone
Shareholder______________________________ Number (______)_________________

SECTION 2 - ADDRESS FOR DELIVERY OF stock certificate if different from above.

- -------------------------------------
- -------------------------------------
- -------------------------------------

<PAGE>

INSTRUCTIONS FOR USE OF SUBSCRIPTION AGREEMENT

Each stockholder of Oceanic Exploration Company (the "Company") has the
right to subscribe for 1.5325 shares of Common Stock for each full share of
common stock of the Company owned of record at the close of business on
__________ ___, 1995 (the "Record Date"). The number of shares you are entitled
to subscribe for appears on the front of the Subscription Agreement or can be
calculated by multiplying the number of shares of Common Stock owned of record
on the Record Date by 1.5325 and rounding up to the nearest whole number. The
Subscription Price of $.10 is needed to subscribe for each share of Common
Stock. See Prospectus for detailed information on these options. You may also
subscribe for additional shares pursuant to an Over-Subscription Privilege. TO
EXERCISE YOUR RIGHTS, YOU MUST COMPLETE THE APPROPRIATE SECTIONS ON THE
SUBSCRIPTION AGREEMENT. IF YOU WISH TO EXERCISE YOUR RIGHTS, YOU MUST DO SO BY
NO LATER THAN 5:00 P.M. ____________ ___, 1995. RIGHTS MAY BE EXERCISED ONLY
THROUGH THE COMPANY.

TO EXERCISE YOUR RIGHTS-PLEASE COMPLETE AND RETURN
THE SUBSCRIPTION AGREEMENT

1. Complete "SECTION 1-SUBSCRIPTION AND SIGNATURE."

a. BASIC SUBSCRIPTION RIGHTS. Enter the number of shares you intend to
purchase under your Basic Subscription Rights. The maximum number of shares you
may purchase on Basic Subscription appears on the front of the Subscription
Agreement or can be calculated by multiplying the number of shares of Common
Stock owned of record on the Record Date by 1.5325 and rounding up to the
nearest whole number.

b. OVER-SUBSCRIPTION. Enter the number of shares you desire to purchase
under your Over-Subscription Privilege. THE OVER-SUBSCRIPTION PRIVILEGE IS
AVAILABLE ONLY IF YOU EXERCISED ALL OF YOUR BASIC SUBSCRIPTION RIGHTS. The
maximum number of Shares that you can purchase on Over-Subscription is 6,001,000
shares less the number of shares you purchased on Basic Subscription Rights.
The number of shares that will actually be purchased by you will be subject to
allotment if there are not enough shares remaining after the Basic Subscription
Rights to completely fill all requests for purchases on Over-Subscription.

c. TOTAL SUBSCRIPTION. Enter the total number of shares you want to
purchase in the offer. This number is the sum of the number of shares you are
purchasing on Basic Subscription Rights plus the number of shares you desire to
purchase on Over-Subscription.

d. TOTAL COST. Enter the total cost of your subscription. Your total
cost is the dollar number obtained when you multiply the number of shares shown
under Total Subscription by $.10, the Subscription Price per share.

2. Sign the Subscription Agreement in the space provide at the bottom of
SECTION 1. Include your telephone number in the space provided.

3. Enclose the executed Subscription Agreement, together with a check or money
order made payable to "Oceanic Exploration Company" in the amount of the Total
Cost (Item d. of SECTION 1) in the

<PAGE>

envelope provided. If you use your own envelope, address it to Oceanic
Exploration Company, 5000 South Quebec Street, Suite 450, Denver, Colorado
80237. You may also personally deliver your Subscription Agreement and payment
to Oceanic Exploration Company, 5000 South Quebec Street, Suite 450, Denver,
Colorado 80237

4. MAIL OR DELIVER YOUR EXECUTED SUBSCRIPTION AGREEMENT AND PAYMENT FOR THE
TOTAL COST ON A TIMELY BASIS SO THAT IT IS RECEIVED BY THE COMPANY BY NO LATER
THAN 5:00 P.M. DENVER, COLORADO TIME ON _____________ ___, 1995 (THE "EXPIRATION
DATE"). IF THE COMPANY HAS NOT RECEIVED YOUR SUBSCRIPTION AGREEMENT AND PAYMENT
FOR THE TOTAL COST BY 5:00 P.M. DENVER, COLORADO TIME ON THE EXPIRATION DATE,
YOU WILL NOT BE ENTITLED TO PURCHASE SHARES PURSUANT TO THE RIGHTS.
Accordingly, if you are sending your executed Subscription Agreement and payment
by mail, please allow sufficient time for them to be received by the Company
prior to 5:00 p.m. on the Expiration Date.

STOCKHOLDERS SHOULD CAREFULLY REVIEW THE RELATED PROSPECTUS PRIOR TO MAKING
AN INVESTMENT DECISION WITH RESPECT TO THE RIGHTS REFERRED TO IN THIS
SUBSCRIPTION AGREEMENT.

<PAGE>
Exhibit 5

Law Offices
BALLARD SPAHR ANDREWS &
INGERSOLL
201 South Main Street, Suite 1200
Salt Lake City, Utah 84111
801-531-3000
FAX: 801-531-3001

October 6, 1995

Board of Directors
Oceanic Exploration Company
5000 South Quebec Street
Suite 450
Denver, Colorado

RE: OCEANIC EXPLORATION COMPANY
REGISTRATION STATEMENT ON FORM SB-2
-----------------------------------

Gentlemen:

We have acted as counsel to Oceanic Exploration Company, a Delaware
corporation (the "Company"), in connection with the preparation and filing of a
Registration Statement on Form SB-2 (the "Registration Statement") filed with
the Securities and Exchange Commission on October 6, 1995 pertaining to the
6,001,000 shares of the Company's common stock, $.0625 par value (the "Shares")
being registered in connection with the Company's Rights Offering described in
the Registration Statement (the "Rights Offering").

We have reviewed the Articles of Incorporation and Bylaws of the
Company, resolutions of the board of directors of the Company, the Registration
Statement and such other documents as we have deemed appropriate. As to factual
matters we have relied upon a certificate supplied to us by an officer of the
Company. In rendering the opinion expressed herein, we have assumed, without
investigation, the validity of all documents and the accuracy of all information
supplied to us by the Company.

Based upon the foregoing, we are of the opinion that the Shares being
registered pursuant to the Registration Statement, when the Registration
Statement becomes effective and the Shares are issued and paid for in accordance
with the Rights Offering, will have been duly authorized and will be legally
issued, fully paid and non-assessable.

<PAGE>

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and the reference to this firm under "Legal Matters" in
the Prospectus contained in the Registration Statement.

Very truly yours,

BALLARD SPAHR ANDREWS & INGERSOLL

<PAGE>
Exhibit 10.4

OIL PAYMENT AND NET EARNINGS INTEREST AGREEMENT

THIS AGREEMENT made and entered into this 30th day of August,
1976 by and between DENISON MINES LIMITED, a corporation organized pursuant to
the laws of the Province of Ontario (hereinafter referred to as "Denison"), of
the first part, and OCEANIC EXPLORATION COMPANY, a corporation organized
pursuant to the laws of the State of Delaware, and OCEANIC EXPLORATION CO. OF
GREECE, a corporation organized pursuant to the laws of the State of Colorado
(such latter two corporations hereinafter individually and collectively referred
to as "Oceanic"), of the second part.

RECITALS

A. Pursuant to the Memorandum of Agreement of June 30, 1976
between Denison and Oceanic, as amended, (such agreement and all amendments
thereto collectively referred to as the "Agreement"), Denison has agreed to
acquire all of the interests of Oceanic in and to that certain Exploration and
Development Agreement of June 14, 1975 by and between the Greek State and
Oceanic Exploration Co. of Greece, et al., (the "Exploration and Development
Agreement") and in the areas subject thereto.

B. The Agreement further provides that Denison will make
certain payments to Oceanic, referred to as the "Oil Payment" or "First Oil
Payment" and as the "15% Net Earnings Interest," and that under certain
circumstances Oceanic may make certain payments to Denison, referred to as the
"Second Oil Payment." Denison and Oceanic hereby desire to define the terms and
conditions upon which such payments shall be made to Oceanic and to Denison.

<PAGE>

NOW, THEREFORE, in consideration of the Agreement and of the
premises, Denison and Oceanic agree as follows:

1. DENISON TO OCEANIC OIL PAYMENT. Subject to the further
provisions of this agreement, Denison hereby agrees to pay Oceanic an amount
in United States funds which will result in a net payment of $10,000,000 United
States Funds, after the proportionate amount of Greek income tax paid by the
Contractor (as defined in the Exploration and Development Agreement)
attributable thereto is withheld (which amount before withholding of Greek
income tax is hereinafter referred to as the "Oil Payment") shall be payable by
Denison to Oceanic only in connection with the production of oil, gas and
hydrocarbons pursuant to the Exploration and Development Agreement, if any, and
only upon the following terms:

(a) there shall be determined in respect of each calendar
year, from and including the year 1977, the amount which represents
68.75% of the aggregate amount credited to the Contractor's Profit and
Loss Statement in respect of such year in accordance with the
provisions of Article 15.2(b) of the Exploration and Development
Agreement after deducting from such aggregate amount only the amount
payable in respect of such year to the Greek State as the Greek
State's Percentage Participation Share in accordance with the
provisions of Article 14.5 of the Exploration and Development
Agreement (the expressions used in this clause (a) to have the same
meanings as in the Exploration and Development Agreement);

(b) there shall then be determined the amount which is 15%
of the amount determined under clause (a) above; and

<PAGE>

(c) the amount determined under clause (b) above shall be
the portion of the Oil Payment payable to Oceanic for that calendar
year; Denison shall withhold from each portion of the Oil Payment
payable to Oceanic the proportionate amount of Greek income tax paid
by Denison attributable to that portion of the Oil Payment payable to
Oceanic and shall promptly, after receipt by Denison, deliver to
Oceanic certified copies of receipts issued by the Greek Revenue
authorities for the payment of such income taxes; such delivery shall
constitute a full accounting by and acquittance of Denison for such
withheld amounts. The foregoing payments shall continue until the Oil
Payment has been paid in full, at which time it will automatically
terminate.

If any Acquiring Party (as defined in Article 14.1 of the
Participation and Exploration Agreement dated as of March 21, 1970 entered into
between Oceanic and others and relating to exploration and development in the
Sea of Thrace) should at any time acquire a Permit within the Area of Interest
(as defined in such Participation and Exploration Agreement) then any amount of
production from such Permit which would be credited to Denison's share of the
Contractor's Profit and Loss Statement calculated mutatis mutandis as set out in
Paragraph 1 (a) above shall form part of the amount on which the Oil Payment in
the amount of 15% is to be calculated, but the provisions of this Paragraph
shall not increase the total amount of the Oil Payment.

2. OCEANIC TO DENISON OIL PAYMENT. Pursuant to the Agreement,
Denison has loaned to Oceanic the sum of Ten Million United States Dollars
($10,000,000 U.S.) (the "Loan"). In accordance with Paragraph 16 of the
Agreement, at any time within 30 days

<PAGE>

after commercial production has commenced from any Development Area, Denison
may, by notice in writing, demand payment of the Loan. For purposes of this
Paragraph, commercial production shall be deemed to have commenced on the date
that Denison has received written notice from the Operator that commercial
production has commenced from any Development Area (as the term Development Area
is established in the Exploration and Development Agreement). The Operator for
such purpose shall be the corporation acting as such and appointed by the
Contractors, as defined in the Exploration and Development Agreement, or their
assignees. The term commercial production for the purpose of such notice shall
be defined as sustained uninterrupted production from a Development Area for a
period of 30 days. If the Loan, together with accrued interest, is not paid
within 30 days after such demand, then the Loan shall thereupon be converted
into an oil payment payable to Denison by Oceanic in an amount double the
aggregate of the principal amount of the Loan outstanding and the interest
accrued thereon to the end of the last mentioned period of 30 days. Such oil
payment due Denison (hereinafter called the "Second Oil Payment") shall be paid
by (1) first applying the amount of the Oil Payment (net of Greek tax) payable
by Denison to Oceanic until the full amount provided for as the net amount of
the Oil Payment has been satisfied and (2) then applying the amount (net of
Greek tax) Oceanic would receive as Oceanic's Net Earnings Interest as described
in paragraph 3 except that in the event that the loan is converted into the
Second Oil Payment the amount to which Oceanic is entitled as its Net Earnings
Interest (net of Greek tax) shall, from the time that the full amount provided
for as the net amount of the Oil Payment has been satisfied until the full
amount of the Second Oil Payment is satisfied, be calculated as follows:

<PAGE>

(a) there shall be determined in respect of each calendar year
the amount which represents 68.75% of the aggregate amount
credited to the Contractor's Profit and Loss Statement in respect
of such year in accordance with the provisions of Article 15.2(b)
of the Exploration and Development Agreement after deducting from
such aggregate amount only the amount payable in respect of such
year to the Greek State as the Greek State's Percentage
Participation Share determined in accordance with the provisions
of Article 14.5 of the Exploration and Development Agreement but
excluding earnings in respect of which the final portion of the
Oil Payment is payable (the expressions used in this clause (a)
to have the same meanings as in the Exploration and Development
Agreement);

(b) there shall then be determined the amount that is 15% of the
amount determined under clause (a) above, and;

(c) the amount determined under clause (b) above shall be the
amount payable to Oceanic for that calendar year; Denison shall
withhold from each portion of the amount payable to Oceanic the
proportionate amount of Greek income tax paid by the Contractor
(as defined in the Exploration and Development Agreement)
attributable to that portion of the amount payable to Oceanic and
shall promptly, after receipt by Denison, deliver to Oceanic
certified copies of receipts issued by the Greek Revenue
authorities for the payment of such income tax; such delivery
shall

<PAGE>

constitute a full accounting by and acquittance of Denison for
such withheld amounts.

The amount of the Net Earnings Interest (net of Greek tax) to which Oceanic is
entitled pursuant to this paragraph shall be applied against the amount of the
Second Oil Payment until the Second Oil Payment is fully satisfied. Upon the
Second Oil Payment being fully satisfied, the calculation of the entitlement of
Oceanic to a Net Earnings Interest as set out in this paragraph shall cease to
apply and the calculation of Oceanic's entitlement as set out in paragraph 3
hereof shall commence to apply at that time.

3. NET EARNINGS INTEREST. Denison hereby grants to
Oceanic a 15% net earnings interest (the "Net Earnings Interest") which shall be
payable by Denison to Oceanic as long as there is production under the
Exploration and Development Agreement but (a) only in connection with its
production of oil, gas and hydrocarbons pursuant to the Exploration and
Development Agreement, if any (except as otherwise provided below in this
Paragraph 3); (b) only upon completion of all payments pursuant to the First Oil
Payment and Second Oil Payment, if any; and (c) only upon the following terms:

(a) there shall be determined in respect of each
calendar year, from and including the year in respect of which
the final portion of the First Oil Payment, or Second Oil
Payment, if any, is payable, the amount of the Contractor's
retained net share for such year from each Development area under
the Exploration and Development Agreement, after deduction of
Petroleum Costs recovered under the Exploration and Development
Agreement and the Greek State's Percentage Participation

<PAGE>

Share, but before deducting Greek income tax, but excluding
earnings in respect of which the final portion of the First Oil
Payment or Second Oil Payment, if applicable, is payable (the
expressions used in this clause (a) to have the same meanings
as in the Exploration and Development Agreement).

(b) there shall then be determined the amount which is
15% of the amount determined under clause (a) above; and

(c) the amount determined under clause (b) above shall
be the Net Earnings Interest payable to Oceanic; Denison shall
withhold from each payment to Oceanic of its Net Earnings
Interest the proportionate amount of Greek taxes paid by the
Contractor attributable to the net earnings payable to Oceanic
and shall promptly after receipt by Denison, deliver to Oceanic
certified copies of receipts issued by the Greek Revenue
authorities for the payment of such income taxes; such delivery
shall constitute a full accounting by and acquittance of Denison
for such withheld amounts.

<PAGE>

pursuant to such Participation and Exploration Agreement; provided that Oceanic
shall have paid to Denison, within 30 days after demand therefor by Denison to
Oceanic, 15% of the cash cost of acquisition of such Permit from the Greek
State. If no such payment is made by Oceanic to Denison any right of Oceanic to
each Net Earnings Interest with respect to production pursuant to such Permit
shall be forever extinguished. If Denison does not wish to acquire an interest
in any such Permit acquired by any other party under the said Participation and
Exploration Agreement then Denison shall, to the fullest extent possible, offer
to assign to Oceanic without payment of any consideration therefor such rights
as pursuant to the said Participation and Exploration Agreement, Denison may
properly assign to Oceanic in respect of such Permit, in which event the Net
Earnings Interest shall not apply to such Permit. If within 30 days after the
making of such offer Oceanic requests in writing such assignment by or on behalf
of Denison, Denison will cause such assignment to be made without warranty.

If any non-consent well (as defined in the said Participation and
Exploration Agreement) is drilled and Denison does not participate therein, then
the Net Earnings Interest shall not apply to such non-consent well or to any
area forfeited by Denison by reason of its failure to participate in the
drilling of such non-consent well if prior to the commencement of the drilling
thereof Denison has offered to assign to Oceanic without payment of any
consideration therefor such rights as, pursuant to the said Participation and
Exploration Agreement, Denison may properly assign to Oceanic in respect of such
non-consent well. Upon written request there for by Oceanic within 30 days
after the making of such offer, Denison promptly will assign such rights to
Oceanic.

<PAGE>

4. ESTIMATED PAYMENTS; METHOD OF PAYMENT. From and
including the year 1977 Denison shall make monthly payments to Oceanic in
respect of the Oil Payment and the Net Earnings Interest, as applicable, such
monthly payments to be made on the basis of estimates by Denison as to the
amounts payable with respect to the year in which such payments are made and
adjustment to be made as soon as possible after the end of each such year so
that the full amount payable in respect of such year shall have been paid. In
like manner Oceanic will make monthly estimated payments to Denison and year end
reconciliations and adjustments with respect to the Second Oil Payment, if any.

Such payments shall be made in United States currency to accounts
designated by Oceanic and Denison, respectively by notice as hereinafter
provided. However, if currency export restrictions or other regulation or
requirement of the Greek State prevent Denison from exporting from its Greek
account United States funds realized by Denison from such operations which it
seeks to utilize to make such payments Denison may so notify Oceanic and may
suspend any such payments to Oceanic. Denison's payments to Oceanic will be
resumed only upon Oceanic's designation of an account in Greece to which such
payments may be made by Denison, or upon the termination of such restrictions or
requirements by the Greek State.

5. RECORDS, INSPECTION. Denison will from time to time make
available to Oceanic at Denison's office in Calgary, Alberta, copies of all
drilling, production and related information and of all financial information
relating to the operations under the Exploration and Development Agreement. The
examination thereof shall be conducted by Oceanic at its own expense in ordinary
business hours and so as not to inconvenience Denison. If any copies of any
such material are prepared for Oceanic at its request, the cost thereof shall be
borne by

<PAGE>

Oceanic. Denison will not, however, be required to make available to Oceanic
any information which it is not permitted to make available under the terms of
the Exploration and Development Agreement.

6. DENISON LIEN ON OIL PAYMENT AND NET EARNINGS INTEREST.
Denison is hereby granted a first and prior lien on the Oil Payment and on the
Net Earnings Interest and on all payments due Oceanic thereunder to secure
repayment of the Loan, and to secure payment of any additional amounts due
Denison in connection with the Loan in accordance with its terms. It is further
agreed that any payment required to be made to Fundamental Oil Company or to or
in respect of any action brought by any shareholder or creditor of Fundamental
Oil Company shall be at the entire cost and expense of Oceanic, and Denison
shall be entitled to deduct from any payment required to be made to Oceanic
pursuant to the Oil Payment or the Net Earnings Interest the full amount of any
cost, charge or expense which it may incur in connection with the foregoing or
in connection with any other matter arising under or pursuant to the Agreement.

7. NATURE OF THE OIL PAYMENT AND NET EARNINGS INTEREST. It is
agreed that the Oil Payment and the Net Earnings Interest grant to Oceanic only
the contingent contractual right to receive from Denison certain payments in the
circumstances described herein. It is not the intent of the parties that such
interests grant to Oceanic, and this agreement shall not be deemed or construed
to grant to Oceanic: (a) any right, title or interest in or to any of the
personal property, fixtures or equipment owned or operated by Denison or any
other party to the Exploration and Development Agreement; (b) any right, title
or interest in or to the Exploration and Development Agreement or any licenses,
permits or

<PAGE>

agreements issued or entered into pursuant or related thereto; or (c) any right,
title or interest in or to any oil, gas or hydrocarbons, whether in place or
produced, or products thereof. It is agreed that such interests are merely
private contractual obligations between Oceanic and Denison and accordingly,
this agreement will not be filed with the Greek State for approval or
recognition.

8. ASSIGNMENTS; INUREMENT. This agreement shall be binding on
the successors and assigns of the parties hereto. Oceanic's rights pursuant to
the Oil Payment and the Net Earnings Interest may be transferred, assigned,
pledged, mortgaged or hypothecated only upon delivered to Denison of a copy of
the instruments pursuant to which such transfer, assignment, pledge, mortgage or
hypothecation is to be effected and upon delivery to Denison of an agreement
executed by Oceanic and by the transferee, assignee, pledgee, or mortgagee in
form satisfactory to Denison, providing:

(i) that the interest of the transferee, assignee,
pledgee or mortgagee is subject to Denison's prior lien and security
rights and to all terms of this agreement;

(ii) confirming the amount of all prior payments
pursuant to the Oil Payment, if any; and

(iii) if Oceanic has reserved or retained any interest,
designating a single bank account for deposit by Denison of all
payments due pursuant to such interests, and indemnifying Denison from
any liability or responsibility For apportioning any such payments
between Oceanic and the transferee, assignee, pledgee or mortgagee.

<PAGE>

9. NOTICES. Notices provided for herein shall be in
writing communicated by registered Canadian or United States air mail, or by
telex, charges or postage prepaid, to the current addresses of the parties or to
such other address as either party may designate by notice to the other as above
from time to time. Notice by mail shall be effective three days after mailing.
Notice by telex shall be effective upon the date of transmission and receipt.

10. GOVERNING LAW. The validity, performance and
enforcement of this agreement shall be governed by the law of the Province of
Ontario.

11. ENTIRE AGREEMENT. This agreement sets forth the entire
agreement and understanding between Denison and Oceanic with respect to the Oil
Payments and the Net Earnings Interest, and it supersedes and is controlling
over the Agreement with respect thereto.

Executed this 30th day of August, 1976.

DENISON MINES LIMITED

By /s/
---------------------------

OCEANIC EXPLORATION COMPANY

By /s/
---------------------------
President

<PAGE>

ATTEST:

/s/
- ------------------------
OCEANIC EXPLORATION CO. OF GREECE

By /s/
---------------------------------
President

ATTEST:

/s/
- -----------------------

<PAGE>
Exhibit 10.8

AGREEMENT FOR STUDY AND PETROLEUM EVALUATION
OF THE SOUTH EAST AREA OF BOLIVIA

YACIMIENTOS PETROLIFEROS FISCALES BOLIVIANOS, hereunder YPFB, represented by
Engineers Guillermo Jimenez Gallo and William McKenney Velasco, Executive
President and Vice President of Operations respectively, on the one hand, and
OCEANIC EXPLORATION COMPANY, hereunder the COMPANY represented by Jack Redmond
and Charles N. Haas, on the other hand, agree to enter into the present study
agreement, in accordance with the following clauses:

ONE: OBJECT

1.1 The object of the present agreement is the study and comprehensive
interpretation of the geological, geochemical, geophysical and subsurface
information about an area in the South East of Bolivia, which YPFB now has
available, for the evaluation of the hydrocarbon potential and the
identification of the zones of major prospective interest.

TWO: LOCATION AND EXTENSION OF THE STUDY AREA

2.1 The study area covered by the present agreement, whose location and
delimitation are indicated in the adjoined map Annex "A". Correspond to
zones available for possible new operations contracts, according to the map
of exploration and petroleum operation of YPFB (up-dated in December 1991).

This area is in the Chaco plains, between Paraguay border to the Southeast
and South Latitude 18 degrees 20' to the North, with an approximate area of
11,094 square kilometers, including reserved blocks for exclusive
operations of YPFB.

THREE: PERIOD

3.1 The COMPANY will perform the comprehensive study of the information
supplied on the area covered by the present agreement in the maximum period
of twelve (12) months, counted as of the date of receipt by the COMPANY of
at least 50% of the information requested. Said date will constitute the
beginning of the study and will be defined between YPFB and the COMPANY.
The documents with the requirement of technical information constitute
Annex "B".

<PAGE>

FOUR: OBLIGATIONS OF YPFB

4.1 YPFB will supply the COMPANY, as a loan, all the necessary technical
information on the area covered by the present agreement and the
surrounding area, required for carrying out the study and evaluation
covered by the agreement. Said selected information will include (where
it is applicable):

4.1.1 Superficial geological reports (geological maps, structural
profiles and stratigraphical columns).

4.1.2 Seismic information (basic maps, seismic sections, isochronic and
structural maps).

4.1.3 Magnetic tapes and basic field information of selected seismic
lines for reprocessing.

4.1.4 Gravimetry and magnetometry data.

4.1.5 Geochemical data.

4.1.6 Subsurface information (electrical profiles, velocity tests and
data on the wells drilled).

4.1.7 Rock samples (well cuttings and cores and/or outcroppings)
selected by mutual agreement.

4.1.8 Samples of oils (oil and condensate of reservoirs) of fields
selected by mutual agreement.

4.1.9 Other additional information existing at YPFB such as may be
required by the COMPANY, whenever pertinent.

The listing of information delivered and the remaining to be delivered
by YPFB to the COMPANY is spelled out in Annex "C".

4.2 YPFB will designate two specialists to work in some phases of the study to
be performed by the COMPANY at its main offices, located in Denver,
Colorado, U.S.A., the COMPANY will not be responsible for the safety or the
actions of the YPFB specialties, during the stay at the COMPANY'S
headquarters.

4.3 YPFB will cooperate with the COMPANY in field reviews and/or
geochemical samplings, if necessary during the study stage, providing
technical geological assistance.

<PAGE>

4.4 YPFB is obliged to keep confidential the results of the study conducted by
the COMPANY, during the validity of this agreement and up to 30 days after
the final reports have been delivered to YPFB.

In case the decision is made to negotiate an eventual operations contract,
the confidentiality will be extended during the time of conducting the
negotiations and up to the signing of the contract document.

FIVE: OBLIGATIONS OF THE COMPANY

5.1 As a function of the information supplied by YPFB, the COMPANY will carry
out a comprehensive study of the area covered by this agreement, for the
fulfillment of the objectives indicated in clause one. Said study will
include but shall not be limited to the following (where it is applicable):

5.1.1 Geochemical analysis of source rock and oil samples, for source
rock evaluation, characterization of crudes and oil-oil and oil-
source rock correlation.

5.1.2 Reprocessing of selected seismic sections.

5.1.3 Evaluation and integration of the gravimetric, magnetometric and
seismic information.

5.1.4 Structuro-stratigrahical evaluation, integrating data of wells,
geophysics and surface geology.

5.1.5 Final geological synthesis, including the determination of the
potential petroliferous systems and the areas of major
prospective interest.

5.1.6 Conclusions of the COMPANY with regard to the hydrocarbon
possibilities of the areas covered by the study.

If the COMPANY considers convenient, it will provide a detailed
program of the proposed work to be performed during the study.
This Program will constitute Annex "D".

5.2 In a period of eight (8) to nine (9) months reckoned from the study
initiation date, the COMPANY will present to YPFB information regarding the
advancement and status of the studies and at the latest by the end of the
twelfth (12th) month, will present and deliver to YPFB the final technical
reports on the area, including the originals of the information processed
and interpreted by the COMPANY

<PAGE>

(magnetic tapes, seismic sections, maps, structural profiles and other
graphical documents) emerging from the different phases of the studies
described in point 5.1.

It is understood that the COMPANY is permitted to have a copy of the
information processed by the COMPANY and of the technical reports prepared
during the work.

5.3 The obligation of presenting the final technical reports on each area will
be maintained inalterably even if the COMPANY decides it is interested in
beginning negotiations for the signing of an operations contract on part or
all of the study area and/or even if such an operations contract winds up
being concluded.

5.4 In order that the information processed and elaborated by the COMPANY may
be used later on in a manner suitable for YPFB, the formats of magnetic
tapes, scales and forms of presenting the graphical documents must, as far
as possible, be compatible with the formats of YPFB, which will be
established jointly with YPFB.

5.5 All the works on geochemical sampling, laboratory analyses, processing,
interpretation and other works related to the study and presentation of the
final reports will be executed by the COMPANY through its own means and
under its own responsibility, at no cost whatever to YPFB.

5.6 In accordance with clause 4.2, the COMPANY shall receive at its main office
of Denver, Colorado, USA the two professionals appointed by YPFB, it being
the obligation of the COMPANY to defray the travel expenses and round trip
of the mentioned professional persons, as well as their stay and living
expenses, for a maximum period of two weeks, in accordance with the
policies of the COMPANY.

The travel dates and duration of the stay of the two YPFB at COMPANY
headquarters will be scheduled and determined by mutual agreement between
YPFB and the COMPANY, depending on the progress of the study and taking
into consideration the stages of greatest interest to YPFB.

5.7 It is the obligation of the COMPANY to return information supplied by YPFB,
which it may do before or at the conclusion of the final report, by virtue
of the fact that said information is the exclusive property of YPFB.

5.8 The COMPANY is bound to keep in strict confidence any and all information
received from YPFB, as well as the results and final reports of the study
covered by this agreement and not to supply or divulge it to third parties,
except in

<PAGE>

case it is a question of firms and/or corporations affiliated with the COMPANY,
which, with prior approval of YPFB may participate in this agreement at any
stage of the study covered herein.

SIX: SELECTION OF AREAS

6.1 During the validity of this agreement and for up to thirty (30) days after
presentation of the final report to YPFB, the COMPANY may select an area of
prospective interest available within the study area covered herein, in
order to enter into negotiations for the possible signing of an operations
contract.

6.2 The parties stipulate that if third firms, with or without previously
signed study agreements on the area described in clause 2.1, manifest a
desire to negotiate with YPFB, operations contracts on part or all of the
study area covered herein, and that if this occurs before the end of the
thirteenth (13th) month, reckoned as of the study initiation date, YPFB
will immediately inform the COMPANY in writing of such a situation in order
that a period not exceeding thirty (30) days after having received the
official notification from YPFB, it may make known its desire to
participate in such negotiations for an operations contract, or else
consider concluded, partially or totally, the present agreement.

6.3 If as a consequence of that which is established in the preceding point the
COMPANY manifests its interest in negotiating an operations contract it is
stipulated that in such a situation at this moment, both the COMPANY and
the other interested firm(s) will receive on the part of YPFB similar
treatment in time and facilities so that they may, under equal conditions,
present their negotiating proposals to YPFB.

6.4 With prior approval of YPFB, the COMPANY may make known about the areas
covered under this agreement to other non company-affiliated firms only in
case the COMPANY desires to interest partners for participation in an
eventual operations contract.

6.5 If the COMPANY desires to negotiate an Operations Contract or Association
over areas that include, partially or totally, blocks that YPFB (see clause
2.1) has consigned in their operational plans and in which work programs or
investments are established with defined plans, the possibility to
establish negotiations over such areas will depend on whether the COMPANY'S
offer will be better, in magnitude and time, with respect to the minimum
exploration program defined by YPFB for these areas.

<PAGE>

SEVEN: DISSOLUTION OF THE AGREEMENT

7.1 Cause for dissolution of the agreement is the total or partial
noncompliance on the part of the parties. with any one or more of the
clauses stipulated in this agreement.

7.2. If for the reasons stipulated in clause 6.2, COMPANY decides not to go
forward with the study of the areas covered herein and appraises YPFB
thereof in writing, the COMPANY is bound to proceed with the immediate
return of all the information supplied by YPFB and with the delivery of a
partial technical report, together with all information that has been
processed up to and including the date of notification of termination of
the agreement.

EIGHT: ACCEPTANCE

8.1 YACIMIENTOS PETROLIFEROS FISCALES BOLIVIANOS and OCEANIC EXPLORATION
COMPANY express their total agreement with each and every one of the
clauses in the present document, as testimony of which they do sign four
copies (two in Spanish and two in English).

Santa Cruz, 11 May 1992

For: YACIMIENTOS PETROLIFEROS FlSCALES BOLIVIANOS:

/s/ William McKenney Velasco /s/ Guillermo Jimenez Gallo
- ------------------------------- ------------------------------
Eng. William McKenney Velasco Eng. Guillermo Jimenez Gallo
EXECUTIVE VICE PRESIDENT EXECUTIVE PRESIDENT

For: OCEANIC EXPLORATION COMPANY

/s/ Charles N. Haas /s/Jack Redmond
- -------------------------- ---------------------------------
Charles N. Haas Jack Redmond
PRESIDENT VICE PRESIDENT - EXPLORATION

<PAGE>

Exhibit 10.20

MODIFICATION AGREEMENT

THIS MODIFICATION AGREEMENT (this "Agreement") is entered into as of
September 19, 1995 by and among Oceanic Exploration Company, a Delaware
corporation ("OEC"), Oceanic International Properties Corporation, a Colorado
corporation and wholly-owned subsidiary of OEC ("OIPC"), and NWO Resources,
Inc., an Ohio corporation ("NWO").

WHEREAS, NWO extended a line of credit in the cumulative amount of
$2,000,000 in favor of OEC (the "Line of Credit"); and

WHEREAS, OIPC has executed and delivered to NWO six promissory notes
with a cumulative principal amount equal to $2,000,000, copies of which are
attached as Exhibit A, evidencing draws under the Line of Credit (the "Oceanic
Notes"); and

WHEREAS, OEC as debtor and NWO as creditor entered into a Security
Agreement, dated July 27, 1994, granting NWO a security interest in OEC's 15%
net earnings interest held through Denison Mines Limited in certain areas
offshore Greece (the "Net Profits Interest") to secure payment of draws under
the Line of Credit (the "Security Agreement"); and

WHEREAS, OIPC is in default under the Oceanic Notes; and

WHEREAS, NWO and Oceanic entered into a letter agreement dated August
9, 1995 regarding the forbearance by NWO of collection of principal and interest
on the Oceanic Notes, the terms of which letter agreement are incorporated and
clarified herein.

NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereby agree as follows:

1. FORBEARANCE. Subject to the terms of this Agreement, NWO will
forbear collection of principal or interest on the Oceanic Notes until December
31, 1996 and OEC shall use its best efforts to file a registration statement
with the Securities and Exchange Commission with respect to the rights offering
described below and use its best efforts to cause the registration statement to
become effective by December 31, 1995.

2. PAYMENTS ON OCEANIC NOTES. All proceeds from the Net Profits
Interest, including proceeds from the litigation in connection with the Net
Profits Interest (the "Denison Proceeds") either before or after December 31,
1996 will first be applied by OEC and OIPC to paying accrued interest on the
Oceanic Notes. After all accrued interest has been paid on the Oceanic Notes
and prior to December 31, 1996, OEC may use up to $200,000 of the Denison
Proceeds for general working capital purposes. All remaining Denison Proceeds
will be applied by OEC and OIPC to paying accrued and unpaid interest and
outstanding principal on the Oceanic Notes.

<PAGE>

3. AMENDMENT TO SECURITY AGREEMENT. Contemporaneously with the
execution of this Agreement, OEC and NWO will enter into an amendment to the
Security Agreement in the form attached as Exhibit B.

4. INTEREST RATE. As of August 9, 1995, each of the Oceanic Notes
is hereby amended to provide for interest to accrue at a rate of 8.25% per
annum.

5. DENISON LITIGATION. OEC shall diligently pursue its pending
lawsuit against Denison Mines, Ltd. In order to enable OEC to diligently pursue
such lawsuit, NWO agrees to make advances to Oceanic to pay legal fees reflected
in statements received by OEC subsequent to August 1, 1995 in connection with
the litigation up to $100,000 (the "NWO Advances"). The NWO Advances shall be
made from NWO to OEC within 30 days of receiving a copy of the statement
evidencing such legal fees.

6. RIGHTS OFFERING. OEC will use its best efforts to raise
approximately $600,000 of working capital, less offering costs, to pay
litigation, administrative and other operating costs by making a rights offering
to its stockholders consisting of rights to acquire an aggregate of 6,000,000
shares at a purchase price of $.10 per share or an aggregate purchase price of
$600,000.

7. REIMBURSEMENT OF NWO ADVANCES. OEC agrees to reimburse NWO for
the NWO Advances together with interest thereon computed at the annual rate of
10% upon receipt of the proceeds of the rights offering referred to in paragraph
"6" above or January 31, 1996, whichever occurs earlier.

8. EXPENSES. Each of the parties to this Agreement will bear its
own expenses in connection with the negotiation and consummation of the
transactions contemplated by this Agreement.

9. GOVERNING LAW. This Agreement shall be construed under and
governed by the laws of the State of Colorado.

10. NOTICES. All notices, requests, demands and other communications
hereunder shall be deemed to have been duly given if delivered, telegraphed or
mailed by certified or registered mail to the addresses previously provided by
each party or to such other address of which any party may notify the other
party.

11. COMPLETE AGREEMENT. This Agreement, including the Exhibit
referred to herein, is complete; and all promises, representations,
understandings, warranties and agreements with reference to the subject matter
hereof, and all inducements to the making of this Agreement relied upon by all
the parties hereto, have been expressed herein or in said Exhibit.

<PAGE>

12. BINDING EFFECT. This Agreement shall be binding upon, and shall
be enforceable by and inure to the benefit of, the parties named herein and
their respective successors and assigns.

13. SEVERABILITY. The failure of any of the parties to this
Agreement to require the performance of a term or obligation under this
Agreement or the waiver by any of the parties to this Agreement of any breach
hereunder shall not prevent subsequent enforcement of such term or obligation or
be deemed a waiver of any subsequent breach hereunder. In case any one or more
of the provisions of this Agreement shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of
this Agreement but this Agreement shall be construed as if such invalid or
illegal or unenforceable provision or part of a provision had never been
contained herein.

14. DISCLOSURE. Except as may be deemed necessary by OEC to comply
with applicable securities laws, no press releases or any public disclosures,
either written or oral, of the transactions contemplated by this Agreement shall
be made without the prior knowledge and written consent of the parties hereto.

15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute one agreement.

16. ATTORNEY FEES. In the event there is a default under this
Agreement and it becomes necessary for any party to enforce his rights
hereunder, then with or without litigation, the prevailing party shall be
entitled to his expenses, including reasonable attorneys' fees, arising out of
such enforcement of his rights hereunder.

17. AMENDMENT. This Agreement may be modified only by an agreement
in writing and signed by the party against whom enforcement of any waiver,
changes, modification or discharge is sought.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.

OEC:
----
OCEANIC EXPLORATION COMPANY

By: /s/ Charles N. Haas
---------------------------------
Name: Charles N. Haas
Title: President

OIPC:
-----
OCEANIC INTERNATIONAL
PROPERTIES CORPORATION

By: /s/ Charles N. Haas
---------------------------------
Name: Charles N. Haas
Title: President

NWO:
----
NWO RESOURCES, INC.

By: /s/ John E. Jones
----------------------------------
Name: John E. Jones
Title: Secretary / Treasurer

<PAGE>
Exhibit 10.21

FIRST AMENDMENT TO
SECURITY AGREEMENT

This First Amendment to Security Agreement (this "Amendment") is
made and entered into this 19th day of September, 1995 by Oceanic Exploration
Company, a Delaware corporation, ("Debtor") whose address is 5000 South Quebec
Street, Suite 450, Denver, Colorado 80237, and NWO Resources, Inc., an Ohio
corporation, whose address is 5000 South Quebec Street, Suite 450, Denver,
Colorado 80237 ("Secured Party");

W I T N E S S E T H:

WHEREAS, Debtor has a line of credit with Secured Party whereby
Debtor is entitled to make periodic draws up to the aggregate of $2,000,000,
which draws are evidenced by promissory notes payable no later than December 31,
1995 (the "Line of Credit"); and

WHEREAS, Debtor and Secured Party entered into a Security
Agreement, dated July 27, 1995 (the "Original Agreement" and as amended by this
Amendment, the "Security Agreement") to secure payment of the Line of Credit;
and

WHEREAS, Debtor, through draws made by Oceanic International
Properties Corporation, a Colorado corporation and wholly-owned subsidiary of
Debtor ("OIPC") and evidenced by promissory notes executed by OIPC in favor of
NWO (the "Oceanic Notes") has exhausted the Line of Credit; and

WHEREAS, Debtor, OIPC and the Secured Party have entered into a
Modification Agreement of even date herewith, which provides for certain
modifications to the rights and obligations of the Parties with respect to draws
made under the Line of Credit and evidenced by the Oceanic Notes (the
"Modification Agreement")

NOW THEREFORE, for and in consideration of the premises and the
agreements herein contained and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Debtor and Secured
Party hereby agree as follows:

1. DEFINED TERMS. All terms with initial capital letters not
otherwise defined herein shall have the meaning ascribed to such term in the
Original Agreement.

2. DEFINITION OF COLLATERAL. Section 1.01 of the Original
Agreement is hereby amended by adding the following to Section 1.01 as
subsection (d):

(d) All proceeds resulting from or related to the
litigation pending in the Ontario Court (General Division ), Canada
between Debtor and

1
<PAGE>

Denison Mines Limited, including any existing and future accounts or
other amounts receivable by Debtor from Denison Mines Limited.

3. OBLIGATIONS SECURED. Section 1.02 of the Original Agreement
is hereby amended to provide that the obligations secured by the Security
Agreement are the obligations described in Section 1.02 of the Original
Agreement as such obligations are modified by the Modification Agreement and
include the obligations of OIPC under Oceanic Notes, as modified by the
Modification Agreement.

4. DEFAULT. Section 4.01(a) of the Original Agreement is
hereby amended in its entirety to read as follows:

(a) Principal and Interest Payments - default is made in
the payment when due of any installment of principal or interest on
the promissory notes issued in connection with the line of credit as
such promissory notes or corresponding payment terms may have been
modified by the Modification Agreement or of any other fee provided
for herein.

5. FURTHER ASSURANCE. The parties hereby agree to execute and
deliver any document, instrument or notice reasonably requested by the other
party to give notice of or effect to the amendments described herein. Upon
satisfaction of the obligations secured by the Security Agreement, Secured Party
shall execute and deliver to Debtor releases in recordable form, of all UCC-1
financing statements and other publicly filed notices of the security interest
granted by the Security Agreement.

6. RATIFICATION OF SECURITY AGREEMENT. Except as expressly
provided herein, the Security Agreement is hereby ratified and confirmed.

2
<PAGE>

IN WITNESS HEREOF, Debtor and Secured Party have caused this
instrument to be duly executed as of the date first above written.

DEBTOR:

OCEANIC EXPLORATION COMPANY

By: /s/ Charles N. Haas
---------------------------------
Name: Charles N. Haas
Title: President

SECURED PARTY:

NWO RESOURCES, INC

By: /s/ John E. Jones
----------------------------------
Name: John E. Jones
Title: Secretary / Treasurer

<PAGE>

Exhibit 10.22

INTERNATIONAL HYDROCARBONS

August 22, 1995

Board of Directors
Oceanic Exploration Company
5000 S Quebec St Ste 450
Denver CO 80237

Gentlemen:

You have informed us that Oceanic Exploration Company ("OEC") will attempt to
raise $600,000 of working capital to pay litigation, administrative and other
operating expenses by making a rights offering for 6,000,000 shares of OEC
common stock on a pro rata basis to its shareholders and that a registration
statement is currently being prepared on such shares.

Please be advised that to the extent that other Oceanic shareholders do not
subscribe to shares offered pursuant to this rights offering, International
Hydrocarbons will subscribe to any unsubscribed shares provided that such shares
are offered to International Hydrocarbons so that it can subscribe and pay for
such shares within a reasonable time after the rights offering and provided that
OEC uses its best efforts to obtain an effective registration statement from the
Securities and Exchange Commission by December 31, 1995.

Yours very truly,

/s/ John E. Jones
John E. Jones
Vice President

5000 SOUTH QUEBEC STREET SUITE 450 DENVER, COLORADO 80237

<PAGE>

Exhibit 23.1

CONSENT OF INDEPENDENT AUDITORS

THE BOARD OF DIRECTORS
OCEANIC EXPLORATION COMPANY:

We consent to the use of our report included herein and to the reference to our
firm under the heading "Experts" in the prospectus.

Our report dated May 31, 1995, contains an explanatory paragraph that states
that the Company's inability to generate sufficient cash flow to sustain
operations and service its debt raises substantial doubt about the Company's
ability to continue as a going concern. The consolidated financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.

Our report also contains an explanatory paragraph that states that the Company
has commenced legal action in Canada seeking a declaration by the Court that
amounts due the Company attributable to its 15% net profit interest in an oil
and gas property offshore Greece be calculated based on the terms of a license
agreement with the Greek government before a recent amendment. The working
interest owner who has the contractual obligation to the Company for its 15% net
profits interest has ceased remitting payments to the Company and has filed a
counter claim. The ultimate outcome of the litigation can not presently be
determined. Accordingly, no provision for any liability or loss that may result
upon adjudication has been recognized in the consolidated financial statements.

KPMG PEAT MARWICK LLP

Denver, Colorado
October 3, 1995