BURLINGTON RESOURCES INC, 10-K405, 1995-02-09

BURLINGTON RESOURCES INC
10-K405, 1995-02-09
CRUDE PETROLEUM & NATURAL GAS

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 1994

( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER 1-9971

BURLINGTON RESOURCES INC.
5051 WESTHEIMER, HOUSTON, TEXAS 77056
TELEPHONE: (713) 624-9500

<TABLE>
<S> <C>
INCORPORATED IN THE STATE OF DELAWARE EMPLOYER IDENTIFICATION NO. 91-1413284
</TABLE>

SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
COMMON STOCK, PAR VALUE $.01 PER SHARE
PREFERRED STOCK PURCHASE RIGHTS

THE ABOVE SECURITIES ARE REGISTERED ON THE NEW YORK STOCK EXCHANGE.

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. /X/

State the aggregate market value of the voting stock held by non-affiliates
of the registrant: Common Stock aggregate market value as of December 31,
1994: $4,427,813,600

Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date. Class: Common Stock,
par value $.01 per share, on December 31, 1994, Shares Outstanding: 126,508,960

DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the
Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is
incorporated:

Burlington Resources Inc. definitive proxy statement, to be filed not later
than 120 days after the end of the fiscal year covered by this report, is
incorporated by reference into Part III.

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<PAGE> 2

BURLINGTON RESOURCES INC.

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I
Items One and Two

Business and Properties......................................................... 1

Employees....................................................................... 9

Item Three

Legal Proceedings............................................................... 9

Item Four

Submission of Matters to a Vote of Security Holders............................. 9

Executive Officers of the Registrant............................................ 10

PART II

Item Five

Market for Registrant's Common Equity and Related Stockholder Matters........... 11

Item Six

Selected Financial Data......................................................... 11

Item Seven

Management's Discussion and Analysis of Financial Condition and Results of
Operations.................................................................... 12

Item Eight

Financial Statements and Supplementary Financial Information.................... 16

Item Nine

Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.................................................................... 35

PART III

Items Ten and Eleven

Directors and Executive Officers of the Registrant and Executive Compensation... 35

Item Twelve

Security Ownership of Certain Beneficial Owners and Management.................. 35

Item Thirteen

Certain Relationships and Related Transactions.................................. 35

PART IV

Item Fourteen

Exhibits, Financial Statement Schedules and Reports on Form 8-K................. 36
</TABLE>
<PAGE> 3

PART I

ITEMS ONE AND TWO

BUSINESS AND PROPERTIES

Burlington Resources Inc. ("BR") is a holding company engaged, through its
principal subsidiary, Meridian Oil Inc. and its affiliated companies (together
the "Company"), in the exploration, development and production of oil and gas,
and related marketing activities, which include aggregation and resale of third
party oil and gas. The Company is the largest independent (nonintegrated) oil
and gas company in the United States in terms of total domestic proved
equivalent reserves which were estimated at 6.6 TCFE at December 31, 1994.

From its inception in 1988 through 1993, BR restructured its assets to
become solely an oil and gas exploration and production company. The
restructuring included the sale of non-strategic assets (real estate, minerals
and forest products) resulting in cumulative gross proceeds of $1.4 billion and
the 1992 spin-off of El Paso Natural Gas Company ("EPNG"). The net proceeds from
non-strategic asset sales were reinvested in domestic oil and gas reserves and
in the repurchase of the Company's common stock.

For definitions of certain oil and gas terms used herein, see "Certain
Definitions" on page 9.

GENERAL INFORMATION

The Company's objective is to build long-term shareholder value by
continuing to grow and enhance its asset base. To achieve this objective, the
Company's strategy is to increase production, reserves, earnings and cash flow
through acquisitions, development and exploration of high potential properties
and application of advanced technologies.

The Company is engaged in oil and gas operations located principally in the
San Juan Basin, the Gulf Coast Basin, the Permian Basin, the Anadarko Basin, the
Black Warrior Basin and the Williston Basin. Virtually all of the Company's oil
and gas production is from properties located in the United States. Following is
a description of the Company's major areas of activity.

SAN JUAN BASIN. The San Juan Basin is the Company's most prolific
operating area in terms of reserves and production. The San Juan Basin, located
in northwest New Mexico and southwest Colorado, encompasses nearly 7,500 square
miles, or approximately 4.8 million acres, with the major portion located in the
New Mexico counties of Rio Arriba and San Juan. The Company is the largest
private holder of productive mineral acreage in this area with over 1 million
net acres under its control. The Company has an interest in over 11,000 wells
and currently operates approximately 7,200 of these wells. Approximately 61
percent of the Company's reserves are located in this basin. The Company's daily
net production at year end 1994 in this basin exceeded 650 MMCF of gas per day,
representing approximately 60 percent of the Company's total daily gas
production at year end 1994.

The four significant gas producing horizons in the San Juan Basin, which
range in depth from approximately 1,000 feet to 8,500 feet, are the Fruitland
Coal, the Pictured Cliffs, the Mesaverde and the Dakota. The Pictured Cliffs,
Mesaverde and Dakota are sandstone formations while the Fruitland Coal produces
gas which is adsorbed to the surface of coal seams. The Company has been an
industry leader in the development of the Fruitland Coal formation. The
Company's net coal seam production from approximately 1,200 wells exceeded 350
MMCF of gas per day at year end 1994.

In order to manage production more effectively, improve recovery of
reserves and remove impurities, the Company owns and operates the Val Verde
plant and gathering system which includes approximately 400 miles of gathering
lines and eight compressor stations to gather and treat coal seam gas in the San
Juan Basin. The Company also owns and operates a fractionation plant located in
McKinley County, New Mexico.

1
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GULF COAST BASIN. The Gulf Coast Basin includes onshore and offshore oil
and gas deposits along virtually all of the states bordering the Gulf of Mexico.
The area encompasses about 250,000 square miles and is one of the most heavily
explored oil and gas basins in the world. The complex geologic conditions and
multiple prospective oil and gas formations, encountered as deep as 25,000 feet,
make this an attractive area for the application of advanced technologies such
as 3D seismic, computerized modeling and horizontal drilling.

Offshore

In 1994, the Company established an operating position in the shallow
offshore waters of the Gulf of Mexico through its acquisition of Diamond
Shamrock Offshore Partners Limited Partnership. The Company has an interest in
99 leases in offshore Federal and State waters and operates 40 of these leases.
As of year end 1994, total net production attributable to offshore properties
was over 110 MMCF of gas per day and 5 MBbls of oil per day.

Onshore

The Company's onshore activities in the Gulf Coast Basin are primarily
concentrated in the Luling and Darst Creek Fields and the West Ranch area
located in south Texas. The Company has been actively applying horizontal
drilling technology in the Edwards formation of the Luling and Darst Creek
Fields to enhance production from this mature area. During 1994, 11 horizontal
wells were drilled in these fields at a net cost of approximately $3 million. As
of year end 1994, net production from the Luling and Darst Creek Fields was
approximately 4 MBbls of oil per day, with 43 percent of this production
attributable to horizontal wells drilled since these properties were acquired in
1989.

PERMIAN BASIN. The Company is an active operator in the Permian Basin,
which includes essentially all of west Texas and southeast New Mexico and
encompasses approximately 68,000 square miles. The Company's reserve base in the
Permian Basin has more than doubled since 1988 from internal development
projects and through the acquisition of producing properties. The Company has an
interest in over 12,000 Permian Basin wells and operates over 3,000 of these
wells resulting in net production at year end 1994 of approximately 17 MBbls of
oil per day and 140 MMCF of gas per day.

The most productive structural feature in the Permian Basin is the Central
Basin Platform in which the Company controls over 158,000 net acres of mineral
interests. This area is about 170 miles long and 50 miles wide trending
northwest from west Texas to southeast New Mexico. Over 20 different formations,
ranging in depth from 2,000 feet to over 12,000 feet, produce oil and gas on the
Central Basin Platform. The Waddell Ranch, located 40 miles west of Midland,
Texas, is the largest consolidated block of acreage in this basin in which the
Company has an interest. The Company operates over 1,600 wells in the Waddell
Ranch resulting in net production of approximately 4 MBbls of oil per day and 21
MMCF of gas per day at year end 1994.

The Val Verde Basin is a 7,000 square mile sub-basin of the Permian Basin
located about 125 miles southeast of Midland, Texas. The Company has utilized
advanced reservoir stimulation technology which primarily consists of modern
hydraulic fracturing techniques in the Canyon Sand trend of this basin. During
1994, the Company participated in the drilling of 50 wells at a net cost of
approximately $17 million. As of year end 1994, the Company operated over 480
wells in the Canyon Sand trend with net production of approximately 50 MMCF of
gas per day.

Another producing area in the Permian Basin is the Delaware Sand trend
located in southeast New Mexico covering approximately 2,300 square miles. The
Company controls approximately 74,000 net acres within this trend. Wells in this
trend typically produce from multiple horizons and the area is prospective for
both oil and gas. Productive zones range in depth from 3,000 feet to 22,000
feet. The Company's 1994 activity focused on the development of oil from the
Delaware Sand trend at a depth of approximately 8,500 feet. During 1994, the
Company participated in the drilling of 30 Delaware Sand wells at a net cost of
approximately $18 million.

2
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The application of three dimensional ("3D") seismic technology has become
an effective exploitation tool in the Permian Basin due to the complex geologic
nature of this area. In 1994, over 170 square miles were surveyed for a total
investment of approximately $5 million. The analysis of this data has resulted
in the drilling of 10 wells including 2 horizontal wells. Additional 3D seismic
data is continually being acquired in order to exploit new and existing oil and
gas opportunities.

ANADARKO BASIN. The Anadarko Basin, located in the western portion of
Oklahoma, the Texas panhandle and southwestern Kansas, encompasses over 30,000
square miles and contains some of the deepest producing formations in the world.
The basin produces oil and gas from multiple zones ranging in depth from less
than 1,000 feet to over 26,000 feet. The Company controls over 520,000 net acres
with the majority located in western Oklahoma. As of year end 1994, the Company
operated 828 wells in this basin and total net production was over 130 MMCF of
gas per day. The Company has been concentrating its Anadarko Basin activity in
the Elk City and Strong City Fields where the application of 3D seismic
technology, computerized modeling and advanced reservoir stimulation are
enhancing the value of these assets. The primary producing horizons in these
fields are the Morrow, Springer and Cherokee Red Fork formations. During 1994,
the Company participated in the drilling of 40 wells to these formations at a
net cost of approximately $23 million.

BLACK WARRIOR BASIN. The Black Warrior Basin covers approximately 35,000
square miles extending across northwest Alabama and northeast Mississippi. The
basin produces from both conventional and coal seam gas formations. In 1994, the
Company divested nearly all of its wells and gathering systems associated with
conventional producing formations in this basin. The Company's current
operations are primarily concentrated on developing coal seam gas reserves. The
Company controls over 138,000 net acres in the coal seam gas play near
Tuscaloosa, Alabama and currently has approximately 20,000 net acres developed
with 128 wells producing over 14 MMCF of gas per day at year end 1994. During
1994, the Company participated in the drilling of 52 coal seam wells in the
Black Warrior Basin at a net cost of approximately $20 million.

WILLISTON BASIN. The Williston Basin encompasses approximately 225,000
square miles in western North Dakota, northwest South Dakota, northeast Montana
and Saskatchewan Province, Canada. The Williston Basin has 18 producing horizons
ranging in depth from 4,500 feet to over 15,000 feet. The Company controls over
3 million net acres, primarily in the U.S. portion of the basin, through both
mineral and leasehold interests.

The Company continues its development activity in the Williston Basin of
North Dakota and the adjacent Cedar Creek anticline of Montana through the use
of horizontal drilling technology. During 1994, the Company participated in the
completion of 34 horizontal wells in the two trends at a net cost of
approximately $27 million.

SECTION 29 TAX CREDITS

A number of formations located within the Company's producing areas have
wells that may qualify for tax credits under Section 29 of the Internal Revenue
Code of 1954, as amended ("IRC"). IRC Section 29 provides for a tax credit from
non-conventional fuel sources such as oil produced from shale and tar sands and
natural gas produced from geopressured brine, Devonian shale, coal seams, or
tight sands formations. The Company estimates that the tax credit rate will
range from $.52 to $1.01 per million British Thermal Unit depending on fuel
source. The Company earned approximately $84 million of tax credits in 1994.

3
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CAPITAL EXPENDITURES AND MAJOR PROJECTS

The Company's capital expenditures were as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------
1994 1993 1992
-------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Oil and Gas Activities........................... $810,466 $501,191 $253,658
Plants and Pipelines............................. 36,026 33,327 49,423
Administrative................................... 35,153 18,866 12,366
-------- -------- --------
Total.................................. $881,645 $553,384 $315,447
======== ======== ========
</TABLE>

Capital expenditures for oil and gas activities in 1994 of $810 million
include 59 percent for proved property acquisitions, 34 percent for
developmental drilling and 7 percent for exploration. Included in capital
expenditures for oil and gas activities are exploration costs expensed under the
successful efforts method of accounting and capitalized interest.

Drilling Activity

Drilling activity in 1994 was principally in the San Juan, Gulf Coast,
Permian, Anadarko, Black Warrior and Williston basins.

The following table sets forth the Company's net productive and dry wells.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1994 1993 1992
------ ------ ------
<S> <C> <C> <C>
Productive wells:
Exploratory.............................. 15.9 7.2 5.6
Development.............................. 342.2 243.7 107.3
----- ----- -----
358.1 250.9 112.9
----- ----- -----
Dry wells:
Exploratory.............................. 3.7 9.0 9.9
Development.............................. 13.3 11.6 8.1
----- ----- -----
17.0 20.6 18.0
----- ----- -----
Total net wells.................. 375.1 271.5 130.9
===== ===== =====
</TABLE>

As of December 31, 1994, 18 gross wells, representing approximately 10.3
net wells, were being drilled.

Acquisitions

As a component of its overall growth strategy, the Company continued making
acquisitions of producing properties during 1994. A total of 497 BCFE of oil and
gas reserves was acquired by the Company at a cost of approximately $479
million. Approximately 50 percent of the reserves acquired during the year were
in the Gulf Coast basin. Production associated with the properties acquired was
approximately 125 MMCF of gas per day and 6 MBbls of oil per day at year end
1994.

The Company focuses its acquisition activity in areas where it has
production in order to maximize the efficiencies gained in combining operations
or in new areas where the Company can transfer its technological expertise or
take advantage of premium markets. In addition, the Company uses a selective
acquisition process that emphasizes the purchase of both proved reserves as well
as properties having upside potential that can be developed by the utilization
of both conventional and advanced technologies.

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Asset Rationalization

In an effort to maintain its high quality asset base, the Company continues
to divest marginal and non-strategic oil and gas properties. During 1994, the
Company divested over 1,350 working interest wells comprising approximately 4
percent of the Company's working interest well inventory. In addition, the
Company conveyed its working interests in certain coal seam gas wells in
November 1994. The net proceeds after tax from all 1994 property divestitures
were approximately $89 million.

PRODUCTIVE WELLS, DEVELOPED AND UNDEVELOPED ACREAGE

Working interests in productive wells, developed acreage and undeveloped
leasehold acreage at December 31, 1994 were as follows:

<TABLE>
<CAPTION>
PRODUCTIVE WELLS
- --------------------------------------
OIL GAS DEVELOPED ACRES UNDEVELOPED ACRES
- ----------------- ----------------- ------------------------ ------------------------
GROSS NET GROSS NET GROSS NET GROSS NET
- ------- ------ ------- ------ ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
15,795 4,823 15,732 9,498 6,015,000 3,151,000 2,838,000 1,760,000
</TABLE>

Included in the productive wells data are 1,221 multiple completions.
Excluded from the acreage data are approximately 7 million undeveloped acres of
Company-owned oil and gas mineral rights, of which approximately 3 to 4 million
acres are considered to have potential for oil and gas exploration.

OIL AND GAS PRODUCTION, PRICES AND PRODUCTION COSTS

The Company's average daily production represents its net ownership after
deduction of all royalty interests held by others but includes royalty interests
and net profits interests owned by the Company. The Company's average natural
gas price includes amounts from the sale of NGLs, less the actual costs incurred
to gather, treat, process and transport the hydrocarbons to market. Production
and prices were as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1994 1993 1992
------ ------ ------
<S> <C> <C> <C>
Production:
Gas (MMCF per day)................................. 1,052 920 818
Oil (MBbls per day)................................ 45.6 41.9 40.6
Average sales prices:
Gas per MCF........................................ $ 1.65 $ 1.87 $ 1.64
Oil per barrel..................................... 15.66 16.71 18.83
Average production costs per MCFE.................... .54 .56 .55
Depreciation, depletion and amortization rates per
MCFE............................................... .62 .58 .58
</TABLE>

In 1994, 1993 and 1992, approximately 66 percent, 69 percent and 70
percent, respectively, of the Company's gas production was transported to direct
sale customers through EPNG's pipeline facilities. These transportation
arrangements are pursuant to EPNG's approved Federal Energy Regulatory
Commission ("FERC") tariffs applicable to all shippers. The Company expects to
transport a substantial portion of its future gas production through EPNG's
pipeline system.

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RESERVES

The following table sets forth estimates by the Company's petroleum
engineers of proved oil and gas reserves at December 31, 1994. These reserves
have been reduced for royalty interests owned by others.

<TABLE>
<CAPTION>
GAS OIL TOTAL
(BCF) (MMBBLS) (BCFE)
------ -------- ------
<S> <C> <C> <C>
Proved Developed Reserves................... 4,584 161.9 5,556
Proved Undeveloped Reserves................. 917 22.2 1,050
----- ----- -----
Total Proved Reserves............. 5,501 184.1 6,606
===== ===== =====
</TABLE>

For further information on reserves, including information on future net
cash flows and the standardized measure of discounted future net cash flows, see
"Financial Statements and Supplementary Financial Information--Supplemental Oil
and Gas Disclosures."

INTRASTATE PIPELINES AND NGLS

The Company owns and operates two intrastate natural gas pipeline systems
in west Texas totaling 426 miles and gathering systems in several states. Gas is
sold from the Company's intrastate systems to industrial customers, electric and
gas utilities, and other intrastate pipeline companies.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------
1994 1993 1992
---- ----- ----
<S> <C> <C> <C>
(BCF)
Annual intrastate natural gas throughput:
Company-owned production................ 16 19 25
Third party production.................. 49 41 45
Third party gas transportation and
gathering.................................. 132 139 104
--- --- ---
Total.............................. 197 199 174
=== ==== ===
</TABLE>

The Company is engaged in the fractionation, transportation and marketing
of NGLs which are sold to a variety of distributors, refiners and petrochemical
users. NGL sales were 12.7 MMBbls, 14.9 MMBbls and 14.5 MMBbls, for the years
ended December 31, 1994, 1993 and 1992, respectively.

MARKETING

Marketing Strategy. In pursuit of its strategy to build long-term
shareholder value in a volatile product pricing environment for domestic
hydrocarbons, the Company will continue to develop premium markets for its
production. In addition, the Company adds value through such activities as
processing, gathering, trucking, trading, storing and transporting hydrocarbons
for both itself and third parties. Financial instruments may be used from time
to time in order to hedge the price of a portion of the Company's production.

Wellhead Marketing. The Company's oil and gas production is sold on the
spot market and under short-term contracts at market responsive prices.
Substantially all of the Company's oil and gas production is sold to Meridian
Oil Trading Inc. ("MOTI"), a wholly-owned marketing subsidiary of the Company.

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Other Marketing. MOTI engages in various activities including the
marketing of the Company's production as well as the purchase and resale of
third party oil, gas and NGLs. MOTI contracts to provide oil and gas to various
customers and aggregates supplies from various sources including third-party
producers, marketing companies, pipelines, financial institutions and from the
Company's underlying production. MOTI utilizes other hedging and trading
strategies including sales in the futures market, options trading, time trades,
fixed price oil and gas swaps, and the outright purchase and sale of oil and gas
to third parties.

OTHER MATTERS

Competition. The Company actively competes for reserve acquisitions,
exploration leases and sales of oil and gas, frequently against companies with
substantially larger financial and other resources. In its marketing activities,
the Company competes with numerous companies for gas purchasing and processing
contracts and for gas, oil and NGLs at several steps in the distribution chain.
Competitive factors in the Company's business include price, contract terms,
quality of service, pipeline access, transportation discounts and distribution
efficiencies.

Regulation of Oil and Gas Production, Sales and Transportation. Numerous
departments and agencies, both federal and state, have issued rules and
regulations governing the oil and gas industry and its individual members,
compliance with which is often difficult and costly and some of which carry
substantial noncompliance penalties. State statutes and regulations require
drilling permits, drilling bonds and operating reports. Most states in which the
Company operates also have statutes and regulations governing conservation
matters, including the unitization or pooling of oil and gas properties and the
establishment of maximum rates of production from oil and gas wells. Many states
also limit production to the market demand for oil and gas. Such statutes and
regulations may limit the rate at which oil and gas could otherwise be produced
from the Company's properties.

The Company operates various intrastate natural gas pipelines, gathering
systems and NGL pipelines. The United States Department of Transportation and
comparable state agencies regulate, under various enabling statutes, the safety
aspects of the transportation and storage activities of these pipeline
facilities by prescribing safety and operating standards.

The transportation of gas in interstate commerce is regulated by the FERC
pursuant to the Natural Gas Act of 1938. All of the Company's sales of gas are
"deregulated".

The FERC has adopted wide-ranging pipeline regulations promulgated under a
rulemaking, the Order No. 636 series. These regulations are intended by the FERC
to fundamentally restructure the interstate pipeline industry, and, as a result,
they will have a significant impact on the transportation, marketing and,
consequently, pricing of gas. These regulations have been implemented on
individual pipelines but are still subject to many court challenges.

These new regulations implement, on an industry-wide basis, a "straight
fixed-variable" rate design, thus increasing all pipelines' demand charges for
firm transportation service. The straight fixed-variable rate design methodology
allows all of a pipeline's fixed costs, including an equity return and related
income taxes, to be eligible for demand or reservation charge collection. The
regulations permit firm shippers the opportunity to mitigate demand charge
impacts by relinquishing to others, on either a permanent or temporary basis,
their firm transportation entitlements at times when these firm shippers do not
need some or all of their capacity for their own use. In addition, these
regulations also permit the interstate pipeline companies, or their marketing
affiliates, to sell gas in interstate commerce substantially free from
regulation, thereby increasing the competition for gas purchasers. These
regulations also allow interstate pipeline companies to collect from their
customers certain significant transition costs via (i) direct billings or (ii)
demand and/or usage surcharges on their transportation rates.

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<PAGE> 10

The Company currently holds firm and interruptible transportation capacity
rights on EPNG's pipeline system, as well as the systems of other interstate and
intrastate pipelines including EPNG's wholly-owned subsidiary Mojave Pipeline
Company. The contracts providing firm transportation services to the Company
require the payment of substantial transportation demand charges. These demand
charges are paid monthly by the Company regardless of the level of utilization
thereunder. The Company does not expect a materially adverse effect from the
Order 636 series of regulations on the consolidated financial position or
results of operations of the Company.

The FERC recently issued new orders which generally deregulate the field
area service activities of interstate pipeline companies. The new orders have
been appealed and are subject to many court challenges. While the eventual
effect of this deregulation on the Company's production cannot be predicted at
this time, the Company does not expect the deregulation to have a materially
adverse effect on the consolidated financial position or results of operations
of the Company.

Environmental Regulation. Various federal, state and local laws and
regulations covering the discharge of materials into the environment, or
otherwise relating to the protection of the environment, may affect the
Company's operations and costs as a result of their effect on oil and gas
exploration, development and production operations. The Company believes it is
in substantial compliance with applicable environmental laws and regulations.
The Company does not anticipate that it will be required under environmental
laws and regulations to expend amounts that will have a materially adverse
effect on the consolidated financial position or results of operations of the
Company.

Offshore oil and gas operations are subject to regulations of the U.S.
Department of the Interior which currently imposes absolute liability upon the
lessee under a federal lease for the cost of pollution cleanup resulting from
the lessee's operations, and could subject the lessee to possible liability for
pollution damages. In the event of a serious incident of pollution, the U.S.
Department of the Interior may require a lessee under a federal lease to suspend
or cease operations in the affected area.

Filings of Reserve Estimates With Other Agencies. During 1994, the Company
filed estimates of oil and gas reserves for the year 1993 with the Department of
Energy. These estimates were not materially different from the reserve data
presented herein.

8
<PAGE> 11

CERTAIN DEFINITIONS

Gas volumes are stated at the legal pressure base of the state or area in
which the reserves are located and at 60 degrees Fahrenheit. As used in this
Form 10-K, "MCF" means thousand cubic feet, "MMCF" means million cubic feet,
"BCF" means billion cubic feet, "MBbls" means thousands of barrels, "MMBbls"
means millions of barrels, "MCFE" means thousand cubic feet of gas equivalent,
"BCFE" means billion cubic feet of gas equivalent and "TCFE" means trillion
cubic feet of gas equivalent. Oil is converted into cubic feet of gas
equivalent based on 6 MCF of gas to one barrel of oil. "NGL" means natural gas
liquids. Proved reserves represent estimated quantities of oil and gas which
geological and engineering data demonstrate with reasonable certainty can be
recovered in future years from known reservoirs under existing economic and
operating conditions. Reservoirs are considered proved if shown to be
economically producible by either actual production or conclusive formation
tests. Reserves which require the use of improved recovery techniques for
production are included in proved reserves if supported by a successful pilot
project or the operation of an installed program. Proved developed reserves are
the portion of proved reserves which can be expected to be recovered through
existing wells with existing equipment and operating methods. Proved
undeveloped reserves are the portion of proved reserves which can be expected
to be recovered from new wells on undrilled proved acreage, or from existing
wells where a relatively major expenditure is required for completion. With
respect to information on working interests in acreage and wells, "net" acreage
and "net" oil and gas wells are obtained by multiplying "gross" acreage and
"gross" oil and gas wells by the Company's working interest percentage in the
properties.

EMPLOYEES

The Company had 1,846 and 1,729 employees at December 31, 1994 and 1993,
respectively.

ITEM THREE

LEGAL PROCEEDINGS

The Company and its subsidiaries are named defendants in numerous lawsuits
and named parties in numerous governmental proceedings arising in the ordinary
course of business. While the outcome of lawsuits or other proceedings cannot be
predicted with certainty, management expects these matters will not have a
materially adverse effect on the consolidated financial position or results of
operations of the Company.

ITEM FOUR

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

During the fourth quarter of 1994 no matters were submitted to a vote of
security holders.

9
<PAGE> 12

EXECUTIVE OFFICERS OF THE REGISTRANT AND PRINCIPAL SUBSIDIARY

THOMAS H. O'LEARY, 60
Chairman of the Board, President and Chief
Executive Officer Burlington Resources Inc.
February 1993 to Present

Chairman of the Board and Chief Executive Officer, July 1992 to February
1993; Chairman of the Board, President and Chief Executive Officer, October 1990
to July 1992; President and Chief Executive Officer, January 1989 to October
1990.

BOBBY S. SHACKOULS, 44
President and Chief Executive Officer
Meridian Oil Inc.
October 1994 to Present

Executive Vice President and Chief Operating Officer, Meridian Oil Inc.,
June 1993 to October 1994; President and Chief Operating Officer, Torch Energy
Advisors, Inc., July 1991 to May 1993; Executive Vice President, Torch Energy
Advisors, Inc., September 1988 to July 1991.

JOHN E. HAGALE, 38
Senior Vice President and Chief Financial
Officer
Burlington Resources Inc.
April 1994 to Present
Executive Vice President and Chief Financial
Officer
Meridian Oil Inc.
March 1993 to Present

Vice President, Finance, Burlington Resources Inc., March 1992 to February
1993; Vice President, Taxes, Burlington Resources Inc., December 1990 to March
1992; Assistant Vice President, Taxes, Burlington Resources Inc., January 1989
to November 1990.

GERALD J. SCHISSLER, 50
Senior Vice President, Law
Burlington Resources Inc.
December, 1993 to Present

Executive Vice President, Law and Corporate
Affairs
Meridian Oil Inc.
July 1993 to Present

Consultant, June 1991 to July 1993; Senior Vice President, Law, Meridian
Minerals Company, a subsidiary of Burlington Resources Inc., November 1987 to
June 1991.

HAROLD E. HAUNSCHILD, 44
Vice President, Human Resources
Burlington Resources Inc.
July 1992 to Present

Executive Vice President, Human Resources
and Administration Meridian Oil Inc.
May 1993 to Present

Assistant Vice President, Compensation and Benefits, Burlington Resources
Inc., May 1988 to July 1992.

C. RAY OWEN, 49
Executive Vice President and Chief
Operating Officer Meridian Oil Inc.
October 1994 to Present

Senior Vice President, Operations, Meridian Oil, Inc., March 1993 to
October 1994; Vice President, Regional Operations, Meridian Oil Inc., December
1990 to March 1993; Manager, Regional Operations, Meridian Oil Inc., July 1985
to December 1990.

L. EDWARD PARKER, 48
Executive Vice President, Marketing
Meridian Oil Inc.
February 1993 to Present

Senior Vice President, Marketing, Meridian Oil Inc., December 1990 to
February 1993; Vice President, Marketing, Meridian Oil Inc., August 1988 to
November 1990.

10
<PAGE> 13

PART II

ITEM FIVE

MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS

The Company's common stock is traded on the New York Stock Exchange under
the symbol "BR." At December 31, 1994, the number of common stockholders was
24,745.

Information on common stock prices and quarterly dividends is shown on page
34.

ITEM SIX

SELECTED FINANCIAL DATA

The selected financial data for the Company set forth below for the five
years ended December 31, 1994 should be read in conjunction with the
Consolidated Financial Statements.

<TABLE>
<CAPTION>
1994 1993 1992 1991 1990
------ ------ ------ ------ ------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
CONTINUING OPERATIONS FOR THE YEAR ENDED:
Revenues(a)................................. $1,055 $1,043 $ 943 $ 813 $ 829
Operating Income............................ 175 256 240 177 216
Income from Continuing Operations........... 154 255 190 100 124
Earnings per Common Share(b)................ 1.20 1.95 1.44 .75 .87
Cash Dividends Declared per Common
Share(c)................................. .55 .55 .60 .70 .70
AT YEAR END:
Total Assets(d)............................. $4,809 $4,448 $4,470 $5,480 $5,250
Long-term Debt.............................. 1,309 819 1,003 1,298 529
Stockholders' Equity(d)..................... 2,568 2,608 2,406 2,907 3,024
Common Shares Outstanding................... 126.5 129.7 128.9 131.4 137.9
</TABLE>

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

(a) Revenues in 1994 include net amounts from the sale and marketing of NGLs.
Prior year amounts have been reclassified to conform to current year
presentation.

(b) Excluding non-recurring items totaling $.47, $.24, and $.08 per share,
Earnings per Common Share from Continuing Operations would have been $1.48,
$1.20 and $.67 in 1993, 1992, and 1991, respectively.

(c) On January 13, 1993, the Company increased its quarterly dividend rate to
$.1375 per share. In July 1992, the quarterly dividend rate was reduced to
$.125 per share to reflect the June 30, 1992 spin-off of EPNG to the
Company's stockholders.

(d) On June 30, 1992, the Company distributed its EPNG common stock to the
Company's stockholders of record as of June 15, 1992. The distribution was
accounted for as a $575 million non-cash dividend.

11
<PAGE> 14

ITEM SEVEN

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FINANCIAL CONDITION AND LIQUIDITY

The Company's total long-term debt to capital (long-term debt and
stockholders' equity) ratio at December 31, 1994 and 1993 was 34 and 24 percent,
respectively. In May 1994, the Company issued $300 million of 7.15% Notes due
May 1, 1999. The net proceeds were used for general corporate purposes,
including acquisition of oil and gas properties, repayment of commercial paper
and other capital expenditures. The Company had outstanding commercial paper
borrowings at December 31, 1994 of $260 million at an average interest rate of
6.28 percent.

In July 1994, the Company established new revolving credit facilities to
replace the previous $900 million facility that was due to expire in June 1996.
The new credit facilities are comprised of a $600 million revolving credit
agreement that expires in July 1999 and a $300 million revolving credit
agreement that expires July 1995, but is renewable annually by mutual consent.
As of December 31, 1994, there were no borrowings outstanding under the credit
facilities, although borrowing capacity is reduced by outstanding commercial
paper. The Company had the capacity to borrow approximately $640 million under
the credit facilities at December 31, 1994. In addition, the Company has $500
million of capacity under shelf registration statements filed with the
Securities and Exchange Commission.

During 1994, the Company repurchased 3.1 million shares of its common stock
for $122 million. Since December 1988, the Company has repurchased 27.2 million
shares under three 10 million share repurchase authorizations.

Net cash provided by continuing operating activities for 1994 was $498
million compared to $455 million and $433 million in 1993 and 1992,
respectively. The increase in 1994 compared to 1993 is primarily due to working
capital changes partially offset by decreased operating income. The increase in
1993 compared to 1992 is primarily due to higher operating income and increased
current utilization of non-conventional fuel tax credits.

In an effort to maintain its high quality asset base, the Company continues
to divest marginal and non-strategic oil and gas properties. During 1994, the
Company divested 1,350 working interest wells comprising approximately 4 percent
of the Company's working interest well inventory. In addition, the Company
conveyed its working interests in certain coal seam gas wells in November 1994.
The net proceeds after tax, from all 1994 property divestitures were
approximately $89 million. The Company expects to continue divesting marginal
and non-strategic properties in 1995.

In January 1995, the Company entered into a definitive agreement, subject
to certain conditions, to sell its intrastate natural gas pipeline systems in
west Texas and its underground gas storage facility for approximately $80
million. The assets being sold contributed less than 5 percent of the Company's
consolidated operating income in each of the years ended December 31, 1994, 1993
and 1992. The Company expects this transaction to be completed in the first
quarter of 1995.

The Company is involved in certain environmental proceedings and other
related matters. Although it is possible that new information or future
developments could require the Company to reassess its potential exposure
related to these matters, the Company believes, based upon available
information, the resolution of these issues will not have a materially adverse
effect on the consolidated financial position or results of operations of the
Company.

The Company has certain commitments and uncertainties related to its normal
operations. Management believes that there are no commitments, uncertainties or
contingent liabilities that will have a materially adverse effect on the
consolidated financial position or results of operations of the Company.

12
<PAGE> 15

CAPITAL EXPENDITURES AND RESOURCES

Capital expenditures during 1994 totaled $882 million compared to $553
million and $315 million in 1993 and 1992, respectively. The Company spent $479
million for producing property acquisitions and $331 million on internal
development and exploration during 1994 compared to $270 million and $231
million, respectively, in 1993.

Capital expenditures for 1995, projected to be approximately $580 million,
are expected to be primarily for development and exploration of oil and gas
properties, reserve acquisitions, and plant and pipeline expenditures. Capital
expenditures will be funded from internal cash flow supplemented, as needed, by
external financing.

The Company anticipates continued increases in gas production. The
increased availability of gas will be a result of the continuing development of
the Company's gas reserves, exploration of undeveloped acreage and the Company's
producing property acquisition program. The Company expects to market its
additional gas production in the Gulf Coast, the Midwest and the East Coast and
by increasing its traditional California market share.

MARKETING

Wellhead Marketing. The Company's oil and gas production is sold on the
spot market and under short-term contracts at market responsive prices.
Substantially all of the Company's oil and gas production is sold to MOTI, a
wholly-owned marketing subsidiary of the Company.

DIVIDENDS

On January 11, 1995, the Board of Directors declared a common stock
quarterly dividend of $.1375 per share, payable April 3, 1995. Dividend levels
are determined by the Board of Directors based on profitability, capital
expenditures, financing and other factors. The Company declared cash dividends
on common stock totaling approximately $71 million during 1994.

RESULTS OF OPERATIONS

Year Ended December 31, 1994 Compared With Year Ended December 31, 1993

Income from Continuing Operations in 1994 was $154 million or $1.20 per
share compared to $255 million or $1.95 per share in 1993. The 1993 results
include a total of $.47 per share from gains on the sale of the Burlington
Resources Coal Seam Gas Royalty Trust (the "Trust") units and the exchange of
Company debt for Anadarko Petroleum Corporation ("Anadarko") common stock, and a
charge to reflect the increase in the corporate income tax rate.

13
<PAGE> 16

Revenues were $1,055 million in 1994 compared to $1,043 million in 1993.
Gas sales volumes improved 14 percent to 1,052 MMCF per day and oil sales
volumes improved 9 percent to 45.6 MBbls per day which increased revenues $90
million and $23 million, respectively. Gas and oil sales volumes increased
primarily due to continued development and exploration of the Company's oil and
gas properties and producing property acquisitions. The revenue increases were
offset by a 12 percent decline in 1994 average gas sales prices to $1.65 per MCF
and a 6 percent decline in 1994 average oil sales prices to $15.66 per barrel
which decreased revenues $84 million and $17 million, respectively.

Costs and Expenses were $880 million in 1994 compared to $787 million in
1993. The increase was primarily due to a 13 percent improvement in 1994
production levels which increased production related expenses $84 million and a
$5 million increase in exploration costs.

Interest Expense was $90 million in 1994 compared to $73 million in 1993.
The increase was primarily due to additional long-term debt issued in May 1994
and higher outstanding commercial paper borrowings during 1994.

Other Income -- Net was $6 million in 1994 compared to $124 million in
1993. The 1993 amount includes a $108 million gain on the sale of the Trust
units and a $19 million gain from the exchange of Company debt for Anadarko
common stock.

Income Taxes -- The effective income tax rate was a benefit of 71 percent
in 1994 compared to an expense of 17 percent in 1993. Without the additional tax
expense associated with the non-recurring 1993 gains from the sale of the Trust
units and the exchange of Company debt for Anadarko common stock and the
non-recurring portion of the 1993 tax rate increase, the 1993 effective tax rate
was a benefit of 7 percent. The higher 1994 beneficial tax rate is primarily due
to lower 1994 pretax income relative to the non-conventional fuel tax credits
earned.

Year Ended December 31, 1993 Compared With Year Ended December 31, 1992

Income from Continuing Operations in 1993 was $255 million or $1.95 per
share compared to $190 million or $1.44 per share in 1992. The 1993 results
include a total of $.47 per share from gains on the sale of the Trust units and
the exchange of Company debt for Anadarko common stock, and a charge to reflect
the increase in the corporate income tax rate. The 1992 results include a $.24
per share gain on the sale of the Company's interests in Plum Creek Timber
Company, L.P.

Revenues were $1,043 million in 1993 compared to $943 million in 1992.
Average gas sales prices increased 14 percent in 1993 to $1.87 per MCF which
increased revenues $76 million. Gas sales volumes improved 12 percent to 920
MMCF per day which increased revenues $60 million. Oil sales volumes improved 3
percent to 41.9 MBbls per day which increased revenues $8 million. Gas and oil
sales volumes increased primarily due to continued development and exploration
of the Company's oil and gas properties, the impact of producing property
acquisitions, and operational efficiencies resulting from reduced gas gathering
system pressures in the San Juan Basin. These revenue increases were partially
offset by lower oil sales prices which declined 11 percent in 1993 to $16.71 per
barrel and decreased revenues $33 million. In addition, there were no gas
contract recoveries in 1993. The revenues for 1992 include $7 million of
non-recurring gas contract recoveries.

Costs and Expenses were $787 million in 1993 compared to $702 million in
1992. The increase was primarily due to a 10 percent improvement in 1993
production levels which increased production related expenses $64 million, a $13
million increase in administrative expenses and a $9 million increase in
exploration costs.

Interest Expense was $73 million in 1993 compared to $79 million in 1992.
The decrease was primarily due to the April 1993 conversion of approximately $80
million in Company debt for Anadarko common stock and lower commercial paper
borrowings.

14
<PAGE> 17

Other Income -- Net was $124 million in 1993 compared to $57 million in
1992. The 1993 amount includes a $108 million gain on the sale of the Trust
units and a $19 million gain from the exchange of Company debt for Anadarko
common stock. The 1992 amount includes a $50 million gain on the sale of the
Company's interests in Plum Creek Timber Company, L.P.

Income Taxes -- The effective income tax rate was 17 percent in 1993
compared to 13 percent in 1992. The increase is primarily due to $16 million in
additional income tax expense recognized to adjust the cumulative deferred tax
liability for the new corporate income tax rate.

OTHER MATTERS

The Company encounters competition in its business. See "Business and
Properties -- Other Matters" for further discussion of competition.

15
<PAGE> 18

ITEM EIGHT

FINANCIAL STATEMENTS AND SUPPLEMENTARY FINANCIAL INFORMATION

BURLINGTON RESOURCES INC.

CONSOLIDATED STATEMENT OF INCOME

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------
1994 1993 1992
---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C>
Revenues........................................... $1,054,847 $1,043,232 $ 942,647
Costs and Expenses................................. 879,810 787,427 702,299
---------- ---------- ----------
Operating Income................................... 175,037 255,805 240,348
Interest Expense................................... 90,291 72,799 79,196
Other Income -- Net................................ 5,523 124,432 56,887
---------- ---------- ----------
Income from Continuing Operations Before
Income Taxes..................................... 90,269 307,438 218,039
Income Tax Expense (Benefit)....................... (63,977) 52,264 28,352
---------- ---------- ----------
Income from Continuing Operations.................. 154,246 255,174 189,687
Income from Discontinued Operations -- Net of
Income Taxes..................................... -- 1,138 68,141
---------- ---------- ----------
Net Income......................................... $ 154,246 $ 256,312 $ 257,828
========== ========== ==========
Earnings per Common Share:
Continuing Operations............................ $ 1.20 $ 1.95 $ 1.44
Discontinued Operations.......................... -- .01 .51
---------- ---------- ----------
Total............................................ $ 1.20 $ 1.96 $ 1.95
========== ========== ==========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

16
<PAGE> 19

BURLINGTON RESOURCES INC.

CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------
1994 1993
---------- ----------
<S> <C> <C>
(IN THOUSANDS)
ASSETS

Current Assets:
Cash and Short-term Investments................................... $ 19,898 $ 19,784
Accounts Receivable............................................... 193,825 218,361
Inventories....................................................... 35,188 23,954
Other Current Assets.............................................. 17,191 14,572
---------- ----------
266,102 276,671
---------- ----------
Oil and Gas Properties (Successful Efforts Method).................. 5,689,135 5,027,312
Other Properties.................................................... 572,490 540,342
---------- ----------
6,261,625 5,567,654
Accumulated Depreciation, Depletion and Amortization.............. 1,904,212 1,631,941
---------- ----------
Properties -- Net.............................................. 4,357,413 3,935,713
---------- ----------
Other Assets........................................................ 185,095 235,336
---------- ----------
Total Assets.............................................. $4,808,610 $4,447,720
========= =========

LIABILITIES

Current Liabilities:
Accounts Payable.................................................. $ 193,819 $ 202,565
Taxes Payable..................................................... 47,080 58,372
Dividends Payable................................................. 17,434 17,916
Other Current Liabilities......................................... 3,688 20,764
---------- ----------
262,021 299,617
---------- ----------
Long-term Debt...................................................... 1,309,137 819,071
---------- ----------
Deferred Income Taxes............................................... 480,648 566,758
---------- ----------
Other Liabilities and Deferred Credits.............................. 188,763 154,216
---------- ----------
Commitments and Contingent Liabilities

STOCKHOLDERS' EQUITY

Common Stock, Par Value $.01 Per Share (Authorized 325,000,000
Shares; Issued 150,000,000 Shares)................................ 1,500 1,500
Paid-in Capital..................................................... 2,936,374 2,936,934
Retained Earnings................................................... 551,385 467,667
---------- ----------
3,489,259 3,406,101
Cost of Treasury Stock (1994, 23,491,040 Shares; 1993,
20,316,521 Shares)................................................ 921,218 798,043
---------- ----------
Common Stockholders' Equity......................................... 2,568,041 2,608,058
---------- ----------
Total Liabilities and Common Stockholders' Equity......... $4,808,610 $4,447,720
========= =========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

17
<PAGE> 20

BURLINGTON RESOURCES INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1994 1993 1992
---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
Cash Flows From Continuing Operating Activities:
Income from Continuing Operations.................. $ 154,246 $ 255,174 $ 189,687
Adjustments to Reconcile Income to Net Cash
Provided
By Continuing Operating Activities:
Depreciation, Depletion and Amortization........ 337,421 285,258 256,003
Deferred Income Taxes........................... (86,118) 2,438 19,041
Exploration Costs............................... 32,983 28,173 19,501
Working Capital Changes:
Accounts Receivable........................... 24,536 17,294 4,788
Inventories................................... (11,234) (4,940) 12,800
Other Current Assets.......................... (2,619) 69,165 (66,339)
Accounts Payable.............................. (8,746) (29,198) (69,300)
Taxes Payable................................. (11,292) (1,761) 46,197
Other Current Liabilities..................... (17,558) (19,062) (11,038)
Gain on Sales and Other......................... 86,632 (147,130) 31,227
--------- --------- ---------
Net Cash Provided By Continuing
Operating Activities..................... 498,251 455,411 432,567
--------- --------- ---------
Cash Flows From Continuing Investing Activities:
Additions to Properties............................ (881,645) (553,384) (315,447)
Proceeds from Sales and Property Dispositions...... 134,629 173,305 23,386
Other.............................................. (66,289) (4,462) (62,224)
--------- --------- ---------
Net Cash Used In Continuing
Investing Activities..................... (813,305) (384,541) (354,285)
--------- --------- ---------
Cash Flows From Continuing Financing Activities:
Proceeds from Long-term Financing.................. 488,596 -- 150,000
Reduction in Long-term Debt........................ -- (183,610) (645,225)
Dividends Paid..................................... (71,010) (69,711) (85,489)
Treasury Stock Transactions -- Net................. (123,175) 30,999 (100,285)
Financing Activities with EPNG -- Net.............. -- -- 525,361
Other.............................................. 6,266 85,794 (20,032)
--------- --------- ---------
Net Cash Provided By (Used In) Continuing
Financing Activities..................... 300,677 (136,528) (175,670)
--------- --------- ---------
Decrease in Cash and Short-term Investments
from Continuing Operations......................... (14,377) (65,658) (97,388)
Cash Provided By Discontinued Operations............. 14,491 53,713 93,618
Cash and Short-term Investments:
Beginning of Year.................................. 19,784 31,729 35,499
--------- --------- ---------
End of Year........................................ $ 19,898 $ 19,784 $ 31,729
========= ========= =========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

18
<PAGE> 21

BURLINGTON RESOURCES INC.

CONSOLIDATED STATEMENT OF COMMON STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
COST OF COMMON
COMMON PAID-IN RETAINED TREASURY STOCKHOLDERS'
STOCK CAPITAL EARNINGS STOCK EQUITY
------ --------- --------- --------- -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Balance, January 1, 1992............ $1,500 $2,955,723 $ 678,049 $(728,757) $2,906,515
Net Income........................ 257,828 257,828
Cash Dividends ($.60 per share)... (78,657) (78,657)
Distribution of EPNG Stock........ (574,610) (574,610)
Stock Purchases (3,484,200
shares)........................ (136,379) (136,379)
Stock Option Activity and Other... (5,001) 36,094 31,093
------ --------- --------- --------- -------------
Balance, December 31, 1992.......... 1,500 2,950,722 282,610 (829,042) 2,405,790
Net Income........................ 256,312 256,312
Cash Dividends ($.55 per share)... (71,255) (71,255)
Stock Purchases (1,139,900
shares)........................ (45,280) (45,280)
Stock Option Activity and Other... (13,788) 76,279 62,491
------ --------- --------- --------- -------------
Balance, December 31, 1993.......... 1,500 2,936,934 467,667 (798,043) 2,608,058
Net Income........................ 154,246 154,246
Cash Dividends ($.55 per share)... (70,528) (70,528)
Stock Purchases (3,139,600
shares)........................ (122,007) (122,007)
Stock Option Activity and Other... (560) (1,168) (1,728)
------ --------- --------- --------- -------------
Balance, December 31, 1994.......... $1,500 $2,936,374 $ 551,385 $(921,218) $2,568,041
========= ========= ========= ========= ============
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

19
<PAGE> 22

BURLINGTON RESOURCES INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Burlington
Resources Inc. and its majority owned subsidiaries (the "Company"). All
significant intercompany transactions have been eliminated in consolidation. The
financial statements for previous periods include certain reclassifications that
were made to conform to current presentation. Such reclassifications have no
impact on previously reported net income or stockholders' equity.

Cash and Short-term Investments

All short-term investments purchased with a maturity of three months or
less are considered cash equivalents. Cash equivalents are stated at cost, which
approximates market value.

Inventories

Inventories of materials, supplies and products are valued at the lower of
average cost or market.

Properties

Oil and gas properties are accounted for using the successful efforts
method. Under this method, all development costs and acquisition costs of proved
properties are capitalized and amortized on a units-of-production basis over the
remaining life of proved developed reserves and proved reserves, respectively.
Costs of drilling exploratory wells are initially capitalized, but charged to
expense if and when a well is determined to be unsuccessful. In addition, the
Company limits the total amount of unamortized capitalized costs to the value of
future net revenues, based on current prices and costs.

Costs of retired, sold or abandoned properties that constitute a part of an
amortization base are charged or credited, net of proceeds, to accumulated
depreciation, depletion and amortization. Gains or losses from the disposal of
other properties are recognized currently. Expenditures for maintenance, repairs
and minor renewals necessary to maintain properties in operating condition are
expensed as incurred. Major replacements and renewals are capitalized. All
properties are stated at cost.

Revenue Recognition

Gas revenues are recorded on the entitlement method. Under the entitlement
method, revenue is recorded based on the Company's net working interest.

Price Management Activities

The Company uses energy-related financial instruments and physical
inventory for commodity price management purposes. All of these transactions are
recorded utilizing a mark-to-market methodology. The resulting change in
unrealized market gains and losses is recognized currently in the Consolidated
Statement of Income. Management estimates the fair value of these transactions
based on independent market valuations and valuation pricing models.

Hedging and Related Activities

In order to mitigate the risk of market price fluctuations, futures and
options transactions may be entered into as hedges of commodity prices
associated with the sales and purchases of gas and oil. Changes in the market
value of futures and options transactions entered into as hedges are deferred
until the gain or loss is recognized on the hedged transactions. The Company
enters into gas swap agreements in order to convert fixed price gas sales
contracts to market-sensitive contracts. Gains or

20
<PAGE> 23

losses resulting from these transactions are realized in the Company's
Consolidated Statement of Income as the related physical production is
delivered.

Income Taxes

Income taxes are provided based on earnings reported for tax return
purposes in addition to a provision for deferred income taxes. Deferred income
taxes are provided in order to reflect the tax consequences in future years of
differences between the financial statement and tax basis of assets and
liabilities at each year end. Tax credits are accounted for under the
"flow-through" method, which reduces the provision for income taxes in the year
the tax credits first become available.

Reclassification

The Company's 1994 revenues include amounts from the sale of NGLs, less the
actual costs incurred to gather, treat, process and transport the hydrocarbons
to market. To conform to current presentation, the Company reclassified $206
million and $199 million of costs and expenses to revenues for the years ended
1993 and 1992, respectively. The reclassification had no effect on operating
income.

Earnings per Common Share

Earnings per common share is based on the weighted average number of common
shares outstanding during the year. The weighted average number of common shares
outstanding was 129 million, 131 million, and 132 million for the years 1994,
1993, and 1992, respectively.

2. MARKETING ACTIVITIES

The Company's marketing activities include the purchase and resale of oil,
gas and NGLs in addition to the marketing of its own production. The costs and
expenses of third party product marketing consist primarily of the cost of
product purchased and transportation costs. These costs are netted against the
related marketing revenues for financial reporting purposes. The Consolidated
Statement of Income includes net revenues related to marketing of third party
oil, gas, NGLs and downstream trading activities of Company-owned production of
approximately $32 million, $15 million and $32 million for years ended 1994,
1993 and 1992, respectively. The volumes of third party oil, gas and NGLs
marketed in those years are as follows:

<TABLE>
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Oil (MBbls per day)..................................... 467 405 274
Gas (MMCF per day)...................................... 549 526 448
NGLs (MBbls per day).................................... 8 20 20
</TABLE>

Price Management Activities

The Company enters into contracts in the physical delivery and financial
markets for oil and gas for commodity price management purposes and to allow the
Company to remain at market-sensitive prices on certain contracts. Physical and
financial instruments used include gas and oil futures, forwards, swaps, and
option contracts as described below. These contracts may be settled with
physical delivery or cash payments. These trading activities are
marked-to-market and the resulting gains and losses are recognized in the
Consolidated Statement of Income. The mark-to-market as of December 31, 1994 was
a net loss of approximately $250,000.

21
<PAGE> 24

Following is a summary of the financial and physical delivery instruments
utilized that have been marked-to-market.

VOLUMES MARK-TO-MARKET
INSTRUMENT (MBBLS) GAIN (LOSS)
- -------------------------------------------------------------------- ------- --------------
(IN THOUSANDS)
<S> <C> <C>
Variable Priced Forward Oil Purchase Contracts...................... 34,928 $ 25,361
Variable Priced Forward Oil Sales Contracts......................... (40,010) (11,331)
Oil Put Options Sold................................................ 18,190 (13,413)
Oil Call Options Sold............................................... (3,470) (867)
------- ---------
Total Activity............................................ 9,638 $ (250)
======= =========
</TABLE>

A description of the market risks and nature of the Company's price management
activities are as follows:

Variable Priced Forward Oil Purchase and Oil Sales Contracts -- The Company
enters into forward purchase and sales commitments in order to recognize
locational price differences in marketing the Company's and third parties' oil.
At December 31, 1994, the Company had purchase and sales commitments on oil of
35 million and 40 million barrels, respectively. These contracts are for periods
of up to 5 years and have a notional contract amount of approximately $1.3
billion at December 31, 1994. While notional contract amounts are used to
express the volume of transactions, the amounts at risk are substantially
smaller since the pricing of these contracts is essentially at market-sensitive
prices. The mark-to-market on these third party purchase and sales commitments
was a net gain of approximately $14 million as of December 31, 1994. Income from
these transactions for the year ended December 31, 1994, excluding the effect of
the mark-to-market, was a gain of approximately $13.3 million.

Oil Put Options Sold -- The Company sells oil put options and receives
premiums. Oil put options give the purchaser of the put options the right to
require the Company to purchase oil at various prices. At December 31, 1994, the
put options had exercise prices based upon the New York Mercantile Exchange
("NYMEX") oil prices from 12 to 18 months (the "Out Month") from the date the
contracts settle. These contracts settle on a monthly basis from January 1995
through May 1996. The Company is exposed to market risk to the extent that NYMEX
oil Out Month prices are higher than the settlement month NYMEX prices. The
spread between the put option exercise prices and current market prices ranged
from $.45 per barrel to $1.14 per barrel as of December 31, 1994. The
mark-to-market on these contracts as of December 31, 1994, was a net loss of
$13.4 million. Income from these transactions for the year ended December 31,
1994, excluding the effect of the mark-to-market, was a loss of approximately
$760,000.

Oil Call Options Sold -- The Company sells oil call options and receives
premiums. Oil call options give the purchaser of the call options the right to
require the Company to sell oil at various prices. At December 31, 1994, the
call options had exercise prices based upon the NYMEX oil prices up to 12 months
from the date the contracts settle. Additionally, the Company has sold call
options at market-sensitive prices with fixed locational and basis
differentials. These contracts settle on a monthly basis from January 1995
through October 1995. The Company is exposed to market risk to the extent that
NYMEX oil Out Month prices are lower than the settlement month NYMEX prices or
when locational and basis differentials change due to market conditions. The
spread between the call option exercise price and current market prices ranged
from $.05 per barrel to $.35 per barrel as of December 31, 1994. The
mark-to-market on these contracts as of December 31, 1994, was a net loss of
approximately $870,000. Income from these transactions for the year ended
December 31, 1994, excluding the effect of the mark-to-market, was a gain of
approximately $1.7 million.

Hedging and Related Activities

Gas Swap Agreements -- These agreements require the Company and its
counterparties to exchange payment streams based on the difference between fixed
and market-sensitive gas prices. The

22
<PAGE> 25

Company enters into fixed price contracts to accommodate the needs of its
customers. The Company enters into gas swap agreements in order to convert some
of these fixed price gas sales contracts to market-sensitive contracts,
resulting in the Company effectively selling its production at market-sensitive
prices. As of December 31, 1994, the Company is the fixed price payor and fixed
price receiver on 52 BCF and 38 BCF of gas, respectively. These contracts are
for periods of up to 6 years and all volumes are matched with the physical
delivery of the Company's production. Gains and losses from these transactions
are realized in the Company's Consolidated Statement of Income as physical
production is delivered under the related sales contracts.

Futures Contracts Sold -- The Company sells oil and gas futures contracts
on the NYMEX. These contracts allow the Company to sell oil and gas at a future
date for a specified price. Futures contracts which are sold are accounted for
as hedges of the Company's underlying production. The realized income on futures
transactions was a gain of approximately $1.5 million during 1994. All futures
contracts were closed as of December 31, 1994.

Credit and Market Risks

The Company manages and controls market and counterparty risk related to
its trading and price management activities through established formal internal
control procedures which are reviewed on an ongoing basis. Net open positions
often result from the timing of the origination of new transactions. Market risk
is minimized by making various commitments which balance the risks associated
with price management and trading activities. Consequently, price movements can
result in losses on certain contracts which may be offset by gains on other
contracts. The counterparties to these transactions consist primarily of major
financial institutions, independent oil and gas producers, and independent power
producers. The Company attempts to minimize credit-risk exposure to trading
counterparties through formal credit policies, monitoring procedures and through
establishment of valuation reserves related to counterparty credit risk. In the
normal course of business, collateral is not required for financial instruments
with credit risk.

3. INCOME TAXES

The provision (benefit) for income taxes is as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------
1994 1993 1992
--------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Current:
Federal............................................ $ 23,320 $ 39,424 $ (1,985)
State.............................................. (1,179) 10,402 11,296
--------- -------- --------
22,141 49,826 9,311
--------- -------- --------
Deferred:
Federal............................................ (88,772) (14,934) 12,375
Enacted federal tax rate change.................... -- 15,558 --
State.............................................. 2,654 1,814 6,666
--------- -------- --------
(86,118) 2,438 19,041
--------- -------- --------
Total...................................... $ (63,977) $ 52,264 $ 28,352
========= ======== ========
</TABLE>

23
<PAGE> 26

Reconciliation of the federal statutory income tax rate to the effective
income tax rate is as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------
1994 1993 1992
------ ----- -----
<S> <C> <C> <C>
Statutory rate......................................... 35.0% 35.0% 34.0%
State income taxes net of federal tax benefit.......... 1.1 2.6 5.4
Tax credits............................................ (103.3) (25.0) (26.2)
Enacted federal tax rate change........................ -- 5.1 --
Other.................................................. (3.7) (0.7) (0.2)
------ ----- -----
Effective rate............................... (70.9)% 17.0% 13.0%
====== ===== =====
</TABLE>

Deferred tax liabilities (assets) consist of the following:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------
1994 1993
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
Deferred liabilities:
Excess of book over tax basis of properties..................... $ 619,908 $ 696,351
Other........................................................... 35,330 25,862
--------- ---------
655,238 722,213
--------- ---------
Deferred assets:
AMT credits carryover........................................... (150,374) (110,117)
Financial accruals and provisions............................... (2,600) (29,057)
Other........................................................... (21,616) (16,281)
--------- ---------
(174,590) (155,455)
--------- ---------
Total................................................... $ 480,648 $ 566,758
========= =========
</TABLE>

The above net deferred tax liabilities as of December 31, 1994 and 1993,
include deferred state income tax liabilities of approximately $57 million and
$54 million, respectively.

As of December 31, 1994, the Alternative Minimum Tax ("AMT") credits
carryover of approximately $150 million, related primarily to non-conventional
fuel tax credits, is available to offset future regular tax liabilities. The AMT
credits carryover has no expiration date. The benefit of the tax credits is
recognized in continuing operations for accounting purposes. The benefit is
reflected in the current tax provision to the extent the Company is able to
utilize the credits for tax return purposes.

4. LONG-TERM DEBT

Long-term Debt outstanding is as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------
1994 1993
---------- ----------
(IN THOUSANDS)
<S> <C> <C>
Commercial Paper................................................... $ 259,590 $ 70,994
Notes, 7.15%, due 1999............................................. 300,000 --
Notes, 6 7/8%, due 1999............................................ 150,000 150,000
Notes, 8 1/2%, due 2001............................................ 150,000 150,000
Debentures, 9 1/8%, due 2021....................................... 150,000 150,000
Notes, 9 5/8%, due 2000............................................ 150,000 150,000
Debentures, 9 7/8%, due 2010....................................... 150,000 150,000
Other, including discounts -- net.................................. (453) (1,923)
---------- ----------
Total.................................................... $1,309,137 $ 819,071
========== ==========
</TABLE>

24
<PAGE> 27

Excluding commercial paper, the Company has no debt maturities through
1998, however, $450 million is due in 1999. The Company's commercial paper
borrowings at December 31, 1994 had an average interest rate of 6.28 percent.

The Company and a group of banks have $600 million and $300 million
Revolving Credit Facilities which expire in July 1999 and July 1995,
respectively. However, the $300 million Revolving Credit Facility is renewable
annually by mutual consent. Annual fees are .12 and .08 percent, respectively,
of the commitments. At the Company's option, interest on borrowings is based on
the prime rate or Eurodollar rates. The unused commitment under these agreements
is available to cover certain debt due within one year; therefore, commercial
paper is classified as long-term debt. Under the covenants of these agreements,
debt cannot exceed 52.5 percent of the sum of debt and tangible net worth (as
defined in the agreements). Additionally, tangible net worth cannot be less than
$1.3 billion. As of December 31, 1994, there were no borrowings outstanding
under these credit facilities although borrowing capacity is reduced by
outstanding commercial paper. The Company had the capacity to borrow
approximately $640 million under the credit facilities as of December 31, 1994.
In addition, the Company has $500 million of capacity under shelf registration
statements filed with the Securities and Exchange Commission.

5. RESTRUCTURING

From its inception in 1988 through 1993, the Company restructured its
assets to become solely an oil and gas exploration and production company. The
restructuring included the sale of non-strategic assets (real estate, minerals
and forest products).

In March 1992, the Company's wholly-owned subsidiary, El Paso Natural Gas
Company ("EPNG"), completed an initial public offering of approximately 15
percent of its common stock and on May 13, 1992, the Company's Board of
Directors approved the June 30, 1992 distribution of the EPNG common stock owned
by the Company to its stockholders of record as of June 15, 1992. The
distribution was accounted for as a $575 million non-cash dividend of the
Company's investment in EPNG common stock.

In October 1992, the Company sold substantially all of its coal properties
for $80 million. In December 1993, the Company sold its majority interest in
Burlington Environmental Inc. for $28 million. The Company had disposed of
virtually all of its non-strategic assets as of December 31, 1993.

Discontinued Operations

Proceeds from dispositions of discontinued operations assets for the years
ended December 31, 1994, 1993 and 1992 totaled $2 million, $62 million and $101
million, respectively. The Company realized no income from dispositions during
1994. The Company realized $1 million and $25 million of after-tax income net of
$4 million and $23 million of income taxes from discontinued asset sales during
1993 and 1992, respectively. In addition, the discontinued operations of EPNG
generated $43 million of after-tax income, net of $26 million of income taxes,
in 1992. The effective tax rates for the discontinued operations differ from
federal statutory rates primarily due to the effects of state and foreign income
taxes and adjustments to prior year estimates.

6. ARRANGEMENTS WITH EPNG

Transportation

In 1994, 1993 and 1992, approximately 66 percent, 69 percent and 70
percent, respectively, of the Company's gas production was transported to direct
sale customers through EPNG's pipeline facilities. These transportation
arrangements are pursuant to EPNG's approved Federal Energy Regulatory
Commission tariffs applicable to all shippers. The Company expects to transport
a substantial portion of its future gas production through EPNG's pipeline
system.

25
<PAGE> 28

Other Transactions

Prior to the separation from EPNG in 1992, the Company maintained a
Commitment Agreement and Loan Agreements with EPNG. EPNG also participated in an
intercorporate cash management arrangement with the Company. Balances under
these facilities accrued interest at rates approximating short-term market
rates. Interest income on borrowings has been netted against interest expense on
excess cash advanced to the Company. The net amount is included in Interest
Expense and totaled $169,000 for the year 1992.

7. CAPITAL STOCK

The Company's 1993 Stock Incentive Plan (the "1993 Plan") succeeds the
Company's 1988 Stock Option Plan (the "1988 Plan"), which expired by its terms
in May 1993 but remains in effect for options granted prior to May 1993. The
1993 Plan provides for the grant of restricted stock, stock options and stock
appreciation rights or limited stock appreciation rights (together "SARs").

Under the 1993 Plan, options may be granted to officers and key employees
at fair market value at the date of grant, exercisable in whole or part by the
optionee after completion of at least one year of continuous employment from the
grant date.

Activity in the Company's stock option plans was as follows:

<TABLE>
<CAPTION>
EXERCISE
OPTIONS PRICE PER SHARE
---------- ---------------
<S> <C> <C>
Balance, December 31, 1992........................... 4,633,829 $ 10.91 to $38.00
Granted............................................ 489,000 44.00 to 47.56
Exercised.......................................... (1,984,383) 10.91 to 34.68
Cancelled.......................................... (205,273) 31.83 to 46.44
----------
Balance, December 31, 1993........................... 2,933,173 16.14 to 47.56
----------
Granted............................................ 430,200 33.88 to 45.69
Exercised.......................................... (62,631) 21.54 to 38.00
Cancelled.......................................... (154,407) 31.83 to 44.00
----------
Balance, December 31, 1994........................... 3,146,335 $ 16.14 to $47.56
==========
</TABLE>

At December 31, 1994, 2,722,135 options were exercisable at prices of
$16.14 to $47.56 per share. At December 31, 1994, 9,209,900 shares are available
for grant under the 1993 Plan.

Stock Appreciation Rights

The Company has granted SARs in connection with certain outstanding options
under the 1988 Plan. SARs are subject to the same terms and conditions as the
related options. A SAR entitles an option holder, in lieu of exercise of an
option, to receive a cash payment equal to the difference between the option
price and the fair market value of the Company's common stock based upon the
plan provisions. To the extent the SAR is exercised, the related option is
cancelled and to the extent the option is exercised the related SAR is
cancelled. The outstanding SARs are exercisable only under certain circumstances
related to significant changes in the ownership of the Company or its holdings,
or certain changes in the constitution of its Board of Directors. At December
31, 1994, there were 680,896 SARs outstanding related to stock options with
exercise prices ranging from $21.54 to $34.68 per share.

Preferred Stock and Preferred Stock Purchase Rights

The Company is authorized to issue 75,000,000 shares of preferred stock,
par value $.01 per share, and as of December 31, 1994 there were no shares
issued. On December 15, 1988, the Company's Board of Directors designated
3,250,000 of the authorized preferred shares as Series A Preferred Stock. Upon

26
<PAGE> 29

issuance each one-hundredth of a share of Series A Preferred Stock will have
dividend and voting rights approximately equal to those of one share of Common
Stock of the Company. In addition, on December 15, 1988, the Board of Directors
declared a dividend distribution of one Right for each outstanding share of
Common Stock of the Company. The Rights were amended on February 23, 1989. The
Rights become exercisable if, without the Company's prior consent, a person or
group acquires securities having 15 percent or more of the voting power of all
of the Company's voting securities (an "Acquiring Person") or ten days following
the announcement of a tender offer which would result in such ownership. Each
Right, when exercisable, entitles the registered holder to purchase from the
Company one-hundredth of a share of Series A Preferred Stock at a price of $95
per one-hundredth of a share, subject to adjustment. If, after the Rights become
exercisable, the Company were to be involved in a merger or other business
combination in which its Common Stock was exchanged or changed or 50% or more of
the Company's assets or earning power were sold, each Right would permit the
holder to purchase, for the exercise price, stock of the acquiring company
having a value of twice the exercise price (the "Merger Right"). In addition,
except for certain permitted offers, if any person or group becomes an Acquiring
Person, each Right would permit the purchase, for the exercise price, of Common
Stock of the Company having a value of twice the exercise price (the
"Subscription Right"). Rights owned by an Acquiring Person are void as they
relate to the Subscription Right or the Merger Right. The Rights may be redeemed
by the Company under certain circumstances until their expiration date for $0.05
per Right.

8. PENSION PLANS

The Company's pension plans are non-contributory defined benefit plans
covering substantially all employees. The benefits are based on years of
credited service and highest five-year average compensation levels.
Contributions to the plans are based upon the Projected Unit Credit actuarial
funding method and are limited to amounts that are currently deductible for tax
purposes. Contributions are intended to provide not only for benefits attributed
to service to date but also for those expected to be earned in the future.

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------
1994 1993
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Actuarial present value of benefit obligations:

Accumulated benefit obligation, including vested
benefits of $85,599 and $89,524................................ $ 88,060 $ 91,349
======== ========

Projected benefit obligation for service to date.................. $116,839 $127,403
Plan assets, primarily marketable equity and debt
securities, at fair value......................................... (92,935) (91,467)
-------- --------
Funded status of projected benefit obligation....................... 23,904 35,936
Unrecognized net loss............................................... (34,712) (47,006)
Unamortized net transition obligation............................... (4,038) (4,621)
-------- --------
Net prepaid pension asset........................................... $(14,846) $(15,691)
======== ========
</TABLE>

The following information relates to the consolidated Company plans and
includes amounts related to EPNG for the first six months of 1992. The Company's
continuing operations pension expense was $7 million in 1992.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1994 1993 1992
------- ------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Pension cost for the plans includes the following
components:
Service cost--benefits earned during the period........... $ 6,633 $ 5,503 $ 9,817
Interest cost on projected benefit obligation............. 9,395 8,926 28,757
Actual (return)/loss on plan assets....................... 409 (7,857) 7,397
Net amortization and deferred amounts..................... (4,640) 3,851 (33,225)
------- ------- --------
Net pension cost.......................................... $11,797 $10,423 $ 12,746
======= ======= ========
</TABLE>

27
<PAGE> 30

The projected benefit obligation was determined using a weighted average
discount rate of 8.75 percent in 1994 and 7.5 percent in 1993, and a rate of
increase in future compensation levels of 5 percent. The expected long-term rate
of return on plan assets was 9 percent in both 1994 and 1993.

9. COMMITMENTS AND CONTINGENT LIABILITIES

Demand Charges

The Company has entered into contracts which provide firm and interruptible
transportation capacity rights on interstate and intrastate pipeline systems.
These contracts, ranging in terms from 1 to 13 years, require the Company to pay
transportation demand charges regardless of the amount of pipeline capacity
utilized by the Company. The Company paid $51 million, $48 million and $32
million of demand charges of which $40 million, $40 million and $25 million was
paid to EPNG for the years ended December 31, 1994, 1993 and 1992, respectively.

Future transportation demand charge commitments at December 31, 1994, are
as follows:

DEMAND
YEAR ENDING DECEMBER 31, CHARGES
------------------------ --------------
(IN THOUSANDS)
<S> <C>
1995.......................................................... $ 52,240
1996.......................................................... 46,023
1997.......................................................... 46,375
1998.......................................................... 45,058
1999.......................................................... 45,150
Thereafter.................................................... 216,809
-----------
Total.................................................... $ 451,655
===========
</TABLE>

Lease Obligations

The Company has operating leases for office space and other property and
equipment. The Company incurred lease rental expense of $17 million, $13 million
and $10 million for the years ended December 31, 1994, 1993, and 1992,
respectively.

Future minimum annual rental commitments at December 31, 1994, are as
follows:

OPERATING
YEAR ENDING DECEMBER 31, LEASES
------------------------ --------------
(IN THOUSANDS)
<S> <C>
1995.......................................................... $ 14,485
1996.......................................................... 13,845
1997.......................................................... 11,426
1998.......................................................... 10,635
1999.......................................................... 9,353
Thereafter.................................................... 88,576
-----------
Total.................................................... $ 148,320
===========
</TABLE>

28
<PAGE> 31

10. OTHER INFORMATION

Other Income -- Net

A summary of significant items included in Other Income -- Net is as
follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1993 1992
-------- -------
(IN THOUSANDS)
<S> <C> <C>
Gain on sale of Trust units......................... $107,800 $ -
Sale of Plum Creek interests........................ - 50,500
Gain on conversion of debt.......................... 19,108 -
Other -- net........................................ (2,476) 6,387
-------- -------
$124,432 $56,887
======== =======
</TABLE>

During 1994, there were no single significant items included in Other
Income--Net.

Supplemental Cash Flow Information

The following is additional information concerning supplemental disclosures
of cash flow activities:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------
1994 1993 1992
-------- ------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Interest Paid............................... $ 85,599 $77,351 $ 73,702
Income Taxes Paid (Received)--Net........... 40,966 39,948 (44,931)
</TABLE>

In April 1993, holders of the Subordinated Debentures exchanged their
Debentures with a carrying value of approximately $80 million for shares of
Anadarko Petroleum Corporation common stock owned by the Company. This non-cash
exchange is reflected as such in the Statement of Cash Flows.

In December 1992, the Company sold its interests in Plum Creek Timber
Company, L.P. The proceeds included notes receivable of $70 million which were
classified as Other Current Assets at December 1992 and were subsequently
collected in January 1993.

29
<PAGE> 32

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of Burlington Resources Inc.

We have audited the accompanying consolidated balance sheets of Burlington
Resources Inc. as of December 31, 1994 and 1993, and the related consolidated
statements of income, cash flows and common stockholders' equity for each of the
three years in the period ended December 31, 1994. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these 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 financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Burlington
Resources Inc. at December 31, 1994 and 1993, and the consolidated results of
its operations and its cash flows for each of the three years in the period
ended December 31, 1994, in conformity with generally accepted accounting
principles.

/s/ COOPERS & LYBRAND L.L.P.
- ----------------------------
COOPERS & LYBRAND L.L.P.

Houston, Texas
January 11, 1995

30
<PAGE> 33

BURLINGTON RESOURCES INC.

SUPPLEMENTARY FINANCIAL INFORMATION

SUPPLEMENTAL OIL AND GAS DISCLOSURES--UNAUDITED

The supplemental data presented herein reflects information for all of the
Company's oil and gas producing activities.

Capitalized costs for oil and gas producing activities consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------
1994 1993
---------- ----------
(IN THOUSANDS)
<S> <C> <C>
Proved properties............................................... $5,671,033 $4,985,501
Unproved properties............................................. 18,102 41,811
---------- ----------
5,689,135 5,027,312
Accumulated depreciation, depletion and amortization............ 1,714,098 1,455,910
---------- ----------
Net capitalized costs................................. $3,975,037 $3,571,402
========== ==========
</TABLE>

Costs incurred for oil and gas property acquisition, exploration and
development activities are as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------
1994 1993 1992
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Property acquisition:
Unproved................................................. $ 21,679 $ 10,816 $ 10,266
Proved................................................... 479,466 270,235 121,949
Exploration................................................ 30,978 17,159 11,872
Development................................................ 278,343 202,981 109,571
--------- --------- ---------
Total costs incurred............................. $ 810,466 $ 501,191 $ 253,658
========= ========= =========
</TABLE>

The Company's 1994 net revenues from oil and gas producing activities
include amounts from the sale of NGLs, less the actual costs incurred to gather,
treat, process and transport the hydrocarbons to market. With respect to gas
gathered and treated by affiliates, the actual costs incurred are calculated
using the capital investment of the facility depreciated by its expected life,
plus operating costs. Prior year amounts for 1993 and 1992 have been
reclassified to conform to current year presentation.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------
1994 1993 1992
-------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Net revenues............................................... $905,465 $897,927 $800,532
-------- -------- --------
Production costs........................................... 261,453 240,220 214,816
Exploration and impairment costs........................... 32,983 28,173 19,501
Operating expenses......................................... 145,649 135,550 118,499
Depreciation, depletion and amortization................... 299,763 248,505 223,495
-------- -------- --------
739,848 652,448 576,311
-------- -------- --------
Operating income........................................... 165,617 245,479 224,221
Income tax provision....................................... (38,799) 26,582 26,124
-------- -------- --------
Results of operations for oil and gas producing
activities............................................... $204,416 $218,897 $198,097
======== ======== ========
</TABLE>

31
<PAGE> 34

The following table reflects estimated quantities of proved oil and gas
reserves. These reserves have been reduced for royalty interests owned by
others. These reserves, virtually all located in the United States, have been
estimated by the Company's petroleum engineers. The Company considers such
estimates to be reasonable, however due to inherent uncertainties estimates of
underground reserves are imprecise and subject to change over time as additional
information becomes available.

<TABLE>
<CAPTION>
OIL GAS
(MMBBLS) (BCF)
-------- -----
<S> <C> <C>
PROVED DEVELOPED AND UNDEVELOPED RESERVES
January 1, 1992......................................................... 141.1 4,887
Revision of previous estimates....................................... 0.5 (24)
Extensions, discoveries and other additions.......................... 11.4 344
Production........................................................... (14.8) (299)
Purchases of reserves in place....................................... 17.7 165
Sales of reserves in place........................................... (0.4) (2)
------- -----
December 31, 1992....................................................... 155.5 5,071
Revision of previous estimates....................................... (0.9) (30)
Extensions, discoveries and other additions.......................... 12.0 361
Production........................................................... (15.3) (336)
Purchases of reserves in place(a).................................... 17.5 306
Sales of reserves in place(b)........................................ (0.6) (151)
------- -----
December 31, 1993....................................................... 168.2 5,221
Revisions of previous estimates...................................... (1.4) (44)
Extensions, discoveries and other additions.......................... 20.5 407
Production........................................................... (16.6) (384)
Purchases of reserves in place(c).................................... 19.7 379
Sales of reserves in place(d)........................................ (6.3) (78)
------- -----
December 31, 1994....................................................... 184.1 5,501
======= =====
PROVED DEVELOPED RESERVES
January 1, 1992......................................................... 128.1 3,951
December 31, 1992....................................................... 141.8 4,204
December 31, 1993....................................................... 149.8 4,381
December 31, 1994....................................................... 161.9 4,584
</TABLE>

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

(a) Includes the reserves attributable to the purchase of 59 percent of the
Permian Basin Royalty Trust.

(b) Primarily the Burlington Resources Coal Seam Gas Royalty Trust transaction.

(d) Includes the reserves associated with the November 1994 conveyance of
working interests in coal seam gas wells.

32
<PAGE> 35

A summary of the standardized measure of discounted future net cash flows
relating to proved oil and gas reserves is shown below. Future net cash flows
are computed using year end sales prices, costs and statutory tax rates
(adjusted for tax credits and other items) that relate to the Company's existing
proved oil and gas reserves.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------
1994 1993
----------- -----------
(IN THOUSANDS)
<S> <C> <C>
Future cash inflows.............................................. $11,628,000 $11,788,000
Less related future:
Production costs............................................ 3,505,000 3,380,000
Development costs........................................... 466,000 377,000
Income taxes................................................ 1,320,000 1,403,000
----------- -----------
Future net cash flows.................................. 6,337,000 6,628,000
10% annual discount for estimated timing of cash flows......... 3,339,000 3,504,000
----------- -----------
Standardized measure of discounted future net cash flows.... $ 2,998,000 $ 3,124,000
=========== ===========
</TABLE>

A summary of the changes in the standardized measure of discounted future
net cash flows applicable to proved oil and gas reserves is as follows:

<TABLE>
<CAPTION>
1994 1993 1992
---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
January 1.............................................. $3,124,000 $3,138,000 $2,616,000
---------- ---------- ----------
Revisions of previous estimates:
Changes in prices and costs.......................... (350,000) (208,000) 265,000
Changes in quantities................................ (20,000) 9,000 (8,000)
Changes in rate of production........................ 129,000 (105,000) 104,000
Additions to proved reserves resulting from extensions,
discoveries and improved recovery, less related
costs................................................ 195,000 180,000 186,000
Purchases of reserves in place......................... 251,000 260,000 183,000
Sales of reserves in place............................. (67,000) (107,000) (4,000)
Accretion of discount.................................. 363,000 375,000 323,000
Sales of oil and gas, net of production costs.......... (644,000) (578,000) (522,000)
Net change in income taxes............................. (80,000) 91,000 (55,000)
Other.................................................. 97,000 69,000 50,000
---------- ---------- ----------
Net change............................................. (126,000) (14,000) 522,000
---------- ---------- ----------
December 31............................................ $2,998,000 $3,124,000 $3,138,000
========== ========== ==========
</TABLE>

33
<PAGE> 36

BURLINGTON RESOURCES INC.

QUARTERLY FINANCIAL DATA--UNAUDITED

<TABLE>
<CAPTION>
1994 1993
------------------------------------- ------------------------------------
4TH 3RD 2ND 1ST 4TH 3RD 2ND 1ST
------- ------- ------ ------- ------- ------- ------ -------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues(a).......................... $ 241 $ 273 $ 266 $ 275 $ 262 $ 263 $ 267 $ 251
Operating Income..................... $ 21 $ 39 $ 46 $ 69 $ 64 $ 57 $ 69 $ 66

Income from Continuing
Operations(b)...................... $ 52 $ 21 $ 33 $ 48 $ 52 $ 24 $ 134 $ 45
Discontinued Operations.............. -- -- -- -- -- -- -- 1
------- ------- ------ ------- ------- ------- ------ -------
Net Income........................... $ 52 $ 21 $ 33 $ 48 $ 52 $ 24 $ 134 $ 46
======= ======= ====== ======= ======= ======= ====== =======
Earnings per Common Share:
Continuing Operations.............. $ .42 $ .16 $ .25 $ .37 $ .40 $ .18 $ 1.02 $ .35
Discontinued Operations............ -- -- -- -- -- -- .01 --
------- ------- ------ ------- ------- ------- ------ -------
Earnings per Common Share............ $ .42 $ .16 $ .25 $ .37 $ .40 $ .18 $ 1.03 $ .35
======= ======= ====== ======= ======= ======= ====== =======
Dividends Declared per Common Share.. $ .1375 $ .1375 $.1375 $ .1375 $ .1375 $ .1375 $.1375 $ .1375
======= ======= ====== ======= ======= ======= ====== =======
Common Stock Price Range:
High............................... 42 5/8 41 7/8 45 5/8 49 5/8 52 3/8 53 7/8 51 5/8 47 1/4
Low................................ 33 1/8 37 1/4 40 7/8 41 1/2 40 1/4 46 45 36 1/2
</TABLE>

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

(a) Revenues in 1994 include net amounts from the sale and marketing of NGLs.
Prior year amounts have been reclassified to conform to current year
presentation.

(b) The effective tax rate for the fourth quarter of 1994 generated an income
tax benefit primarily due to an increase in the estimated amount of
non-conventional fuel tax credits earned in 1994. The increase was due to
higher taxable income resulting from additional tax gains in the fourth
quarter of 1994.

The effective tax rate for the fourth quarter of 1993 generated an income
tax benefit primarily due to adjustments of prior year estimates. In
addition, the second and third quarter effective tax rates were higher than
the fourth quarter rate primarily due to income taxes recorded at a 39%
combined Federal and State marginal rate on non-recurring second quarter
gains and the effect of the third quarter enactment of a Federal income tax
rate increase.

34
<PAGE> 37

ITEM NINE

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE

None
PART III

ITEMS TEN AND ELEVEN

DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT AND EXECUTIVE COMPENSATION

A definitive proxy statement for the 1995 Annual Meeting of Stockholders of
Burlington Resources Inc. will be filed no later than 120 days after the end of
the fiscal year with the Securities and Exchange Commission. The information set
forth therein under "Election of Directors" and "Executive Compensation" is
incorporated herein by reference. Executive Officers of the Company are listed
on page 10 of this Form 10-K.

ITEM TWELVE

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Information required is set forth under the caption "Election of Directors"
in the Proxy Statement for the 1995 Annual Meeting of Stockholders and is
incorporated herein by reference.

ITEM THIRTEEN

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information required is set forth under the caption "Election of Directors"
in the Proxy Statement for the 1995 Annual Meeting of Stockholders and is
incorporated herein by reference.

35
<PAGE> 38

PART IV

ITEM FOURTEEN

EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
FINANCIAL STATEMENTS AND SUPPLEMENTARY FINANCIAL INFORMATION
Consolidated Statement of Income................................................. 16
Consolidated Balance Sheet....................................................... 17
Consolidated Statement of Cash Flows............................................. 18
Consolidated Statement of Common Stockholders' Equity............................ 19
Notes to Consolidated Financial Statements....................................... 20
Report of Independent Accountants................................................ 30
Supplemental Oil and Gas Disclosures............................................. 31
Quarterly Financial Data......................................................... 34
AMENDED EXHIBIT INDEX................................................................. *
</TABLE>

REPORTS ON FORM 8-K

The Company filed a Form 8-K dated October 10, 1994 which announced
the promotion of Bobby S. Shackouls to the office of President and Chief
Executive Officer of Meridian Oil Inc., a wholly-owned subsidiary of the
Company.
- ---------------

* Included in Form 10-K filed with the Securities and Exchange Commission.

36
<PAGE> 39

SIGNATURES REQUIRED FOR FORM 10-K

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Burlington Resources Inc. has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

BURLINGTON RESOURCES INC.

By /s/ THOMAS H. O'LEARY
---------------------------------
Thomas H. O'Leary
Chairman of the Board, President
and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of Burlington
Resources Inc. and in the capacities and on the dates indicated.

<TABLE>
<C> <S> <C>
By /s/ THOMAS H. O'LEARY Chairman of the Board, January 11, 1995
------------------------------------------ President and Chief
Thomas H. O'Leary Executive Officer

/s/ JOHN E. HAGALE Senior Vice President and January 11, 1995
------------------------------------------ Chief Financial Officer
John E. Hagale

/s/ HAYS R. WARDEN Vice President, Controller January 11, 1995
------------------------------------------ and Chief Accounting
Hays R. Warden Officer

/s/ JOHN V. BYRNE Director January 11, 1995
------------------------------------------
John V. Byrne

/s/ S. PARKER GILBERT Director January 11, 1995
------------------------------------------
S. Parker Gilbert

/s/ JAMES F. McDONALD Director January 11, 1995
------------------------------------------
James F. McDonald

/s/ DONALD M. ROBERTS Director January 11, 1995
------------------------------------------
Donald M. Roberts

/s/ WALTER SCOTT, JR. Director January 11, 1995
------------------------------------------
Walter Scott, Jr.

/s/ WILLIAM E. WALL Director January 11, 1995
------------------------------------------
William E. Wall
</TABLE>

37
<PAGE> 40

BURLINGTON RESOURCES INC.

AMENDED EXHIBIT INDEX

The following exhibits are filed as part of this report.

<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------- -------------------------------------------------------------------------- ------
<S> <C> <C>
3.1 Certificate of Incorporation of Burlington Resources Inc., as amended
(Exhibit 3.1 to Form 8, filed March 1990)................................. *
3.2 By-Laws of Burlington Resources Inc. as amended (Exhibit 3.2 to Form 8,
filed March 1993)......................................................... *
4.1 Form of Rights Agreement dated as of December 16, 1988, between Burlington
Resources Inc. and The First National Bank of Boston which includes, as
Exhibit A thereto, the form of Certificate of Designation specifying terms
of the Series A Preferred Stock and, as Exhibit B thereto, the form of
Rights Certificate (Exhibit 1 to Form 8-A, filed December 1988)........... *
Amendment No. 1 to Form of Rights Agreement (Exhibit 2 to Form 8-K, filed
March 1989)............................................................... *
4.2 Indenture, dated as of June 15, 1990, between the registrant and Citibank,
N.A., including Form of Debt Securities (Exhibit 4.2 to Form 8, filed
February 1992)............................................................ *
4.3 Indenture, dated as of October 1, 1991, between the registrant and
Citibank, N.A., including Form of Debt Securities (Exhibit 4.3 to Form 8,
filed February 1992)...................................................... *
4.4 Indenture, dated as of April 1, 1992, between the registrant and Citibank,
N.A., including Form of Debt Securities (Exhibit 4.4 to Form 8, filed
March 1993)............................................................... *
10.1 The 1988 Burlington Resources Inc. Stock Option Incentive Plan as amended
(Exhibit 10.4 to Form 8, filed March 1993)................................ *
10.2 Burlington Resources Inc. Incentive Compensation Plan as amended (Exhibit
10.5 to Form 8, filed March 1993)......................................... *
10.3 Burlington Resources Inc. Incentive Compensation Plan as amended and
restated October 1, 1994..................................................
10.4 Burlington Resources Inc. Senior Executive Survivor Benefit Plan dated as
of January 1, 1989 (Exhibit 10.11 to Form 8, filed February 1989)......... *
10.5 Burlington Resources Inc. Deferred Compensation Plan dated as of January
1, 1989 (Exhibit 10.12 to Form 8, filed February 1989).................... *
Amendment No. 1 to Burlington Resources Inc. Deferred Compensation Plan
(Exhibit 10.12 to Form 8, filed February 1991)............................ *
10.6 Burlington Resources Inc. Deferred Compensation Plan as amended and
restated October 1, 1994..................................................
10.7 Burlington Resources Inc. Supplemental Benefits Plan as amended and
restated January 1, 1990 (Exhibit 10.14 to Form 8, filed February 1992)... *
10.8 Burlington Resources Inc. Supplemental Benefits Plan as amended and
restated October 1, 1994..................................................
10.9 Employment Contract between Burlington Resources Inc. and Thomas H.
O'Leary (Exhibit 10.14 to Form 8, filed February 1989).................... *
Amendment to Employment Contract between Burlington Resources Inc. and
Thomas H. O'Leary (Exhibit 10.14 to Form 8, filed March 1990)............. *
</TABLE>

A-1
<PAGE> 41

<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------- -------------------------------------------------------------------------- ------
<S> <C> <C>
Amendment to Employment Contract between Burlington Resources Inc. and
Thomas H. O'Leary (Exhibit 10.15 to Form 8, filed February 1992).......... *
Amendment to Employment Contract between Burlington Resources Inc. and
Thomas H. O'Leary (Exhibit 10.8 to Form 10-K, filed February 1994)........ *
Employment Contracts between Meridian Oil Inc. and George E. Howison and
Bobby S. Shackouls (Exhibit 10.8 to Form 10-K, filed February 1994)....... *
10.10 Amendment to Employment Contract between Burlington Resources Inc. and
Thomas H. O'Leary.........................................................
Amendment to Employment Contract between Meridian Oil Inc. and Bobby S.
Shackouls.................................................................
10.11 Burlington Resources Inc. Compensation Plan for Non-Employee Directors
(Exhibit 10.18 to Form S-8, No. 33-33626, filed March 1990)............... *
Amendment No. 1 to Burlington Resources Inc. Compensation Plan for Non-
Employee Directors (Exhibit 10.19 to Form 8, filed February 1992)......... *
10.12 Burlington Resources Inc. Key Executive Severance Protection Plan as
amended June 8, 1989 (Exhibit 10.20 to Form 8, filed February 1992)....... *
10.13 Burlington Resources Inc. Retirement Savings Plan (Exhibit Amendment No. 1
to Form S-8, No. 2-97533, filed December 1989)............................ *
Amendment No. 1 to Burlington Resources Inc. Retirement Savings Plan
(Exhibit 10.15 to Form 8, filed March 1993)............................... *
Amendment No. 2 to Burlington Resources Inc. Retirement Savings Plan
(Exhibit 10.21 to Form 8, filed February 1992)............................ *
Amendment No. 3 to Burlington Resources Inc. Retirement Savings Plan
(Exhibit 10.15 to Form 8, filed March 1993)............................... *
10.14 Burlington Resources Inc. Retirement Income Plan for Directors (Exhibit
10.21 to Form 8, filed February 1991)..................................... *
10.15 Burlington Resources Inc. 1991 Director Charitable Award Plan, dated as of
January 16, 1991 (Exhibit 10.22 to Form 8, filed February 1991)........... *
10.16 Master Separation Agreement and documents related thereto dated January
15, 1992 by and among Burlington Resources Inc., El Paso Natural Gas
Company and Meridian Oil Holding Inc., including exhibits (Exhibit 10.24
to Form 8, filed February 1992)........................................... *
10.17 Burlington Resources Inc. 1992 Stock Option Plan for Non-employee
Directors (Exhibit 28.1 of Form S-8, No. 33-46518, filed March 1992)...... *
10.18 Burlington Resources Inc. Key Executive Retention Plan and Amendments No.
1 and 2 (Exhibit 10.20 to Form 8, filed March 1993)....................... *
Amendments No. 3 and 4 to the Burlington Resources Inc. Key Executive
Retention Plan (Exhibit 10.17 to Form 10-K, filed February 1994).......... *
10.19 Burlington Resources Inc. 1992 Performance Share Unit Plan (Exhibit 10.21
to Form 8, filed March 1993).............................................. *
10.20 Burlington Resources Inc. Severance Plan and Amendments No. 1 and 2
(Exhibit 10.22 to Form 8, filed March 1993)............................... *
Amendments No. 3, 4 and 5 to the Burlington Resources Inc. Severance Plan
(Exhibit 10.20 to Form 10-K, filed February 1994)......................... *
</TABLE>

A-2
<PAGE> 42

<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------- -------------------------------------------------------------------------- ------
<S> <C> <C>
10.21 Burlington Resources Inc. 1993 Stock Incentive Plan (Exhibit 10.22 to Form
10-K, filed February 1994)................................................ *
10.22 Petrotech Long Term Incentive Plan........................................
10.23 Burlington Resources Inc. 1994 Restricted Stock Exchange Plan.............
10.24 $300 million Short-term Revolving Credit Agreement, dated as of July 20,
1994, between Burlington Resources Inc. and Citibank, N.A., as agent......
10.25 $600 million Long-term Revolving Credit Agreement, dated as of July 20,
1994, between Burlington Resources Inc. and Citibank, N.A. as agent.......
11.1 Earnings Per Share Computation............................................
12.1 Ratio of Earnings to Fixed Charges........................................
21.1 Subsidiaries of Registrant................................................
23.1 Consent of Coopers & Lybrand..............................................
27.1 Financial Data Schedule...................................................
</TABLE>

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

*Exhibit incorporated by reference as indicated.

A-3

<PAGE> 1
EXHIBIT 10.3

BURLINGTON RESOURCES INC.
INCENTIVE COMPENSATION PLAN

As Amended and Restated Effective October 1, 1994
(Originally Effective January 1, 1989)

<PAGE> 2

BURLINGTON RESOURCES INC.
INCENTIVE COMPENSATION PLAN

Table of Contents
<TABLE>
Page
----
<S> <C> <C>
Section 1 Definitions . . . . . . . . . . . . . . . . . . 1
Section 2 Administration . . . . . . . . . . . . . . . . . 3
Section 3 Participants . . . . . . . . . . . . . . . . . . 4
Section 4 Incentive Award Pool . . . . . . . . . . . . . . 4
Section 5 Individual Awards . . . . . . . . . . . . . . . 6
Section 6 Payment Of Incentive Awards . . . . . . . . . . 7
Section 7 General Provisions . . . . . . . . . . . . . . . 14
</TABLE>

-i-

<PAGE> 3

BURLINGTON RESOURCES INC.
INCENTIVE COMPENSATION PLAN

PREAMBLE

WHEREAS, Burlington Resources Inc. (the "Company") established
the Burlington Resources Inc. Incentive Compensation Plan (the "Plan")
effective January 1, 1989 in order for the Company to attract and retain
exceptional employees and to provide a direct incentive to the Participants to
improve the profitability of the Company; and

WHEREAS, the Company amended and restated the Plan effective May
1, 1990 and desires to amend and restate the Plan to effect certain changes;

NOW, THEREFORE, the Company does hereby amend and restate the
Plan as set forth herein, effective October 1, 1994.

SECTION 1

DEFINITIONS

For purposes of the Plan, the following terms shall have the
meanings indicated:

1.1 Account means a Memorandum Account, Special Deferral Memorandum
Account, and/or an Automatic Deferral Account, as each is defined in
Section 6.5.

1.2 Beneficiary means the person(s) designated by a Participant, on a
form provided by the Management Committee and filed with the
Company's Human Resources Department, to receive benefits from the
Plan in the event of his or her death. A Participant may change his
or her beneficiary designation at any time. If no designated
Beneficiary survives the

<PAGE> 4

Participant, the Beneficiary shall be the Participant's surviving
spouse or, if none, his or her estate.

1.3 Board means the Board of Directors of the Company.

1.4 Company means Burlington Resources Inc., a Delaware corporation.

1.5 Company Stock Account means a notional subaccount of an Account
credited with Phantom Stock, as provided in Section 6.6.

1.6 Employer means the Company and its subsidiaries.

1.7 Fair Market Value means, as applied to a specific date, the mean
between the highest and lowest quoted selling prices at which the
common stock of the Company was sold on such date as reported in the
NYSE-Corporate Transactions by The Wall Street Journal on such date
or, if no Company common stock was traded on such date, on the next
preceding day on which its common stock was so traded.

1.8 Incentive Award means the amount of a Participant's individual award
granted to the Participant for a year pursuant to Section 5.

1.9 Interest Account means a notional subaccount of an Account credited
with interest, as provided in Section 6.6.

1.10 Management Committee means the committee appointed pursuant to
Section 2.1 to administer the Plan.

1.11 Participant means each employee who participates in the Plan in
accordance with Section 3.

1.12 Permanent Disability means the Management Committee has found, upon
the basis of medical evidence satisfactory to it, that a Participant
is totally disabled, whether due to physical or mental condition, so
as to be prevented from engaging in further fullCtime employment by
the Employers and that such disability is reasonably expected to be
permanent or long-term.

-2-
<PAGE> 5
1.13 Phantom Stock means a phantom or notional share of common stock of
the Company. A Participant shall not possess any rights of a
stockholder of the Company with respect to a share of Phantom Stock,
including, without limitation, rights concerning voting and
dividends. A share of Phantom Stock shall be payable solely in cash
under the Plan.

1.14 Plan means the Burlington Resources Inc. Incentive Compensation Plan
either in its previous or present form or as amended from time to
time.

1.15 Termination means a Participant's termination of employment with the
Employers, including by reason of death, retirement or Permanent
Disability.

SECTION 2

ADMINISTRATION

2.1 Management Committee. The Plan shall be administered by a
management committee (the "Management Committee") consisting of such executives
of the Company as the Chief Executive Officer of the Company shall designate.
Subject to review by the Compensation and Nominating Committee of the Board,
the Management Committee shall have the complete authority and power to
interpret the Plan, prescribe, amend and rescind rules relating to its
administration, select eligible Participants, determine a Participant's (or
Beneficiary's) right to a payment and the amount of such payment, and to take
all other actions necessary or desirable for the administration of the Plan.
All actions and decisions of the Management Committee shall be final and
binding upon all Participants and Beneficiaries. No member of the Management
Committee shall vote on any matter that pertains solely to himself or herself.

-3-
<PAGE> 6
SECTION 3

PARTICIPANTS

3.1 Participants. The Management Committee shall determine and
designate the executives of the Company and other key employees of the
Employers who are eligible to receive awards under the Plan (the
"Participants"). Participants will be limited to those employees who, because
of their management or staff positions, have the principal responsibility for
the management, direction and success of the Company as a whole or a subsidiary
or a particular business unit thereof. Directors of the Company who are
full-time executives of the Company shall be eligible to participate in the
Plan.

SECTION 4

INCENTIVE AWARD POOL

4.1 Incentive Award Pool. A memorandum account (the "Incentive Award
Pool") shall be established for the Company and each participating subsidiary
for purposes of determining the amount of money which shall be available for
Incentive Awards for each year. The Incentive Award Pool of an Employer (the
Company or a participating subsidiary) for each year shall be an amount equal
to the sum total of the aggregate maximum incentive awards available for its
Participants for that year. Each Participant's maximum incentive award for a
particular year (the-Maximum Incentive Award") shall equal the Participant's
annual salary (as defined below) multiplied by the Maximum Award Percentage (as
defined below), which amount is then multiplied by the Performance Standard
Percentage (as defined below) of his Employer for that year; provided, however,
that for Participants in grade F and above who are employed by a participating
subsidiary, the Maximum Incentive Award shall be the sum of (a) the
Participant's annual salary multiplied by his Maximum Award Percentage, which
amount is then multiplied by one-half of the subsidiary's Performance Standard
Percentage for the year, plus (b) the Participant's

-4-
<PAGE> 7
annual salary multiplied by his or her Maximum Award Percentage, which amount
is then multiplied by one-half of the Company's Performance Percentage for the
year. The term "annual salary" shall mean the Participant's annual salary
being paid at the end of the year (or date of Termination, if applicable)
exclusive of bonuses and all other items of compensation for the year.

4.2 Company/Subsidiary Performance. At the beginning of each year,
the Compensation and Nominating Committee shall approve strategic and financial
objectives for the Company for the year, and the Management Committee shall
approve strategic and financial objectives for the participating subsidiaries
for the year. At the end of the year, the same committee that approved the
objectives of the Company or a participating subsidiary, as the case may be,
shall assess the Company or subsidiary's performance in relation to those
objectives for purposes of establishing the size of the Incentive Award Pool in
accordance with the following table of Performance Categories and Standard
Percentages:

<TABLE>

Company or Subsidiary Performance
Performance Category Standard Percentage
--------------------- -------------------
<S> <C> <C>
I. Performance for the year
was outstanding and
exceeded objectives. 100%

II. Performance for the year
met or exceeded objectives
or was excellent in view of
prevailing conditions. 75%

III. Performance for the year
generally met objectives
or was very acceptable
in view of prevailing
conditions. 50%

IV. Performance for the year
did not meet objectives
and was generally below
acceptable levels. 0 to 25%

</TABLE>

-5-

<PAGE> 8
4.3 Maximum Award Percentage. Each participating employer (the
Company or a subsidiary) shall establish the salary grades of its Participants.
The Compensation and Nominating Committee shall assign a percentage of annual
salary (the "Maximum Award Percentage") for the President and Chief Executive
Officer of the Company and the Management Committee shall assign the Maximum
Award Percentages applicable to all other Participants. The Maximum Award
Percentages of the Participants shall be used to calculate the Incentive Award
Pools, as set forth in Section 4.1.

SECTION 5

INDIVIDUAL AWARDS

5.1 President and Chief Executive Officer. The Compensation and
Nominating Committee of the Board shall annually grant the Incentive Award for
the President and Chief Executive Officer of the Company. In evaluating the
President and Chief Executive Officer, the Compensation and Nominating
Committee shall consider the corporate objectives of the Company and his or her
responsibilities and accomplishments, and such other factors as it deems
appropriate.

5.2 Other Participants. The Management Committee shall annually
grant the Incentive Awards to the Participants other than the President and
Chief Executive Officer of the Company in accordance with their individual
performances. In evaluating a Participant, the Management Committee shall
consider the corporate objectives of the Participant's Employer, the
Participant's responsibilities and accomplishments, and such other factors as
it deems appropriate.

5.3 Incentive Award Limits. The aggregate individual Incentive
Awards for an Employer's Participants may not exceed that Employer's Incentive
Award Pool. A Participant's performance must be satisfactory, regardless of
Company or subsidiary performance, before he or she may be granted an Incentive
Award.

-6-
<PAGE> 9
5.4 New Employee, or Retirement, Disability, Death or Termination of
Employment. The Compensation and Nominating Committee or the Management
Committee, as applicable and in its discretion, may grant all or such portion
of an Incentive Award for the year as it deems advisable to a Participant (or
his Beneficiary in the case of his death) who is employed or who is promoted to
an executive grade during the year, or whose employment is terminated during
the year because of his or her retirement, death, permanent disability,
resignation or discharge.

SECTION 6

PAYMENT OF INCENTIVE AWARDS

6.1 Immediate Payment. Each Participant who has elected to receive
his or her Incentive Award for the year currently shall be paid his or her
Incentive Award in cash in the month following the month in which the award is
made.

6.2 Voluntary Deferrals. Prior to the end of any year, each
Participant may elect to have the payment of all or a portion of his or her
Incentive Award for that year deferred until his or her Termination, subject to
a $1,000 minimum. The election shall be irrevocable and shall be made on a
form prescribed by the Management Committee, which shall govern the amount
deferred, the form of its payment pursuant to Section 6.9 following the
Participant's Termination, and, except as provided below, the investment of the
Participant's Memorandum Account for such deferral period pending its payment.
A Participant's deferral election shall apply only to the Incentive Award for
that year. If a Participant has not made a deferral election, the Incentive
Award payable to him or her for that year shall be paid pursuant to Section
6.1.

6.3 Special Deferrals. The Management Committee may, in its
discretion, approve deferred payments ("Special Deferrals") as follows. Prior
to the end of any year, each Participant may elect to have the payment of all
or a portion of

-7-
<PAGE> 10
his or her Incentive Award for that year deferred until a date or dates
specified by the Management Committee, which, with respect to any Special
Deferral invested in Phantom Stock, must be more than six months after the
effective date of such deferral. The Participant's election shall be
irrevocable and shall be made on a form prescribed by the Management Committee.
A Participant's Special Deferral election shall apply only to the Incentive
Award for that year. If a Participant has not made a Special Deferral
election, the Incentive Award payable to him or her for that year shall be paid
in accordance with Section 6.1.

6.4 Automatic Deferrals. If the Management Committee determines that
all or part of the Incentive Award to be paid to a Participant pursuant to
Section 6.1 would be nondeductible by the Company or a subsidiary for Federal
tax purposes due to the limitations of Section 162(m) of the Internal Revenue
Code, so much of the payment, if any, that would be deductible that year shall
be paid to the Participant pursuant to Section 6.1 and, unless the Management
Committee, in its sole discretion, directs otherwise, the balance of such
Incentive Award shall be deferred automatically and credited to the
Participant's Automatic Memorandum Account, which, pursuant to the
Participant's election, shall be invested and payable as follows:

(a) invested in the Interest Account and payable in the first year or
years in which the Management Committee, in its sole discretion, determines
either such payment(s) would be deductible or to forego the deduction;

(b) invested in the Interest Account and payable upon the
Participant's Termination; or

A Participant's election must be made prior to the deferral date and, if
(b) or (c) is elected, the election must also specify the form in which the
Account is to be

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<PAGE> 11
paid as provided in Section 6.9. If the Participant does not timely make an
election with respect to an automatic deferral, he or she shall be deemed to
have elected option (a) above. Automatic Memorandum Accounts are payable only
in cash.

6.5 Memorandum Accounts. Each year the Company shall establish a
ledger or notional account (the "Memorandum Account") for each Participant who
has elected to defer payment of his or her Incentive Award that year for the
purpose of reflecting the Company's obligation to pay the deferred Incentive
Award for such year as specified pursuant to Section 6.9; provided, however,
that all Memorandum Accounts established for a Participant that are to be paid
in the same manner, i.e., a lump sum, 60 installments or 120 installments, may
be combined into a single Memorandum Account. Similarly, a separate Special
Memorandum Account shall be established for each Special Deferral for each
Participant; however, all Special Deferrals of a Participant that are to be
paid at the same time and in the same manner may be combined into a single
Special Memorandum Account. In addition, a separate Automatic Memorandum
Account shall be established for each automatic deferral made pursuant to
Section 6.3 with respect to a Participant.

6.6 Investment of Accounts. Except as provided below, each Account
shall accrue interest on the deferred Incentive Award credited to such Account
from the date such Incentive Award is credited to the Account through the date
of its distribution (the "Interest Account"). Such interest shall be credited
to the Interest Account at the end of each calendar quarter or such other
periods as may be determined by the Management Committee. The Management
Committee shall determine, in its sole discretion, the rate of interest to be
credited periodically to the Interest Accounts.

With respect to an election to defer (or an automatic deferral of) an
Incentive Award for any year beginning after 1993, a Participant may
irrevocably request that the Management Committee credit all or a specified
percentage of his or

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<PAGE> 12
her Incentive Award deferred for that year in shares of Phantom Stock; however,
the Management Committee shall not be obligated to honor any such Participant's
request. If the Management Committee elects to honor any such request, it
shall establish a separate notional subaccount for such Participant under his
or her Account, which shall be credited with whole and fractional shares of
Phantom Stock as of the date of the Incentive Award for such year, and with
phantom (notional) dividends with respect to the Phantom Stock, which shall be
credited as being reinvested in additional shares of Phantom Stock (the
"Company Stock Account"). All credits and debits to the Company Stock Account
shall be made based on the Fair Market Value per share of the Company's common
stock on the applicable date; provided, however, with respect to an automatic
deferral pursuant to Section 6.3 that is to be invested in Phantom Stock, the
number of shares of Phantom Stock credited to the Participant's Company Stock
Account with respect to such automatic deferral shall be determined on the same
basis as if such deferral had been the exercise of a Stock Purchase Right that
year under the Company's 1993 Stock Incentive Plan. If the Management
Committee chooses to not honor any Participant's request to invest his or her
Account in shares of Phantom Stock, the Participant's deferral automatically
shall be held in the Interest Account.

6.7 Special Phantom Stock Investment Elections. Each Participant who
has an Account under the Plan on October 1, 1994 shall be given a one-time
irrevocable election to request that all or a specified percentage of his or
her Account balance as of that date, as elected by the Participant, be invested
in the Company Stock Account; however, the Management Committee shall not be
obligated to honor any such request. This election shall be in such form as
the Management Committee shall establish, and must be made prior to October 1,
1994.

6.8 Change in Section 16(b) Rules. Notwithstanding anything in the
Plan to the contrary, if the rules promulgated under Section 16(b) of the
Securities

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<PAGE> 13
Exchange Act of 1934, as amended, are amended or interpreted by the Securities
and Exchange Commission to permit "insiders" to make investment changes with
respect to their accounts under cash only type of plans like the Plan, the
Management Committee, in its sole discretion, may amend the Plan in any manner
it deems appropriate to allow Participants the ability to request, from time to
time, investment changes with respect to their Account balances under the Plan
and may also add additional notional subaccounts under the Plan for such other
investments as the Management Committee deems appropriate to offer under the
Plan.

6.9 Payment of Accounts. Except as provided below, upon a
Participant's Termination or on any Special Deferral payment date, the Company
shall pay to such Participant (or to his or her Beneficiary in case of the
Participant's death) an amount in cash equal to the balance then credited to
his or her affected Account(s) as follows:

(a) a lump sum payment; or

(b) in 60 consecutive substantially equal monthly installments; or

whichever form of payment has been elected by the Participant. However, if a
Participant elects to receive the distribution of a Company Stock Account in
installments, his or her Company Stock Account automatically shall be converted
into an Interest Account as of the Participant's date of Termination or Special
Deferral payment date, as the case may be.

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<PAGE> 14
payment date) and, unless the Management Committee, in its sole discretion,
directs otherwise, the balance of the Account shall be paid to the Participant
(i) with respect to a Termination, not later than the end of the third month of
the next following year and (ii) with respect to a Special Deferral payment
date, in the first year in which the Management Committee, in its sole
discretion, determines either that such payment would be deductible or to
forego the deduction, in each case such delayed payment being based on the
value of the Account at the time of such actual payment.

Notwithstanding anything in the Plan to the contrary however, each
Participant who has an Account under the Plan on October 1, 1994 shall be given
a one-time irrevocable election to select, within the distribution options
specified above, the manner in which one or more of such Accounts is to be paid
on his or her Termination; provided, however, no such distribution election
shall be effective with respect to any Termination (or Special Deferral payment
date) occurring prior to January 1, 1995, unless such Termination is due to the
Participant's death, Permanent Disability occurring after October 1, 1994, or
involuntary termination by the Company or a subsidiary (whether a termination
is involuntary shall be determined by the Committee). Such distribution
election shall be in such form as established by the Management Committee and
must be made prior to October 1, 1994.

Further, if the Management Committee determines at any time that
Participants may be given the ability to change their election as to the form
of distribution of their Account(s) without causing the loss of any exempt
treatment to "insiders" for securities laws purposes, the Management Committee
may amend the Plan to provide for such election changes as it deems
appropriate.

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<PAGE> 15
6.10 Acceleration of Payments. Notwithstanding a Participant's
election to the contrary, the Management Committee, in its sole discretion, may
accelerate the payment of all or part of the unpaid balance of a Participant's
Account(s) in the event of the Participant's Termination, or upon its
determination that the Participant (or his or her Beneficiary in the case of
the Participant's death) has incurred a "severe financial hardship" resulting
from a sudden and unexpected illness or accident of such person or of a
dependent, a loss of such person's property due to casualty, or other similar
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of such person. The Management Committee in making its
determination of severe financial hardship may consider such factors and
require such information as it deems appropriate, but, in any case, payment may
not be made to the extent that such hardship is or may be relieved (i) through
reimbursement or compensation by insurance or otherwise or (ii) by liquidation
of such person's assets, to the extent liquidation of such assets will not
itself cause severe financial hardship. However, notwithstanding the
foregoing, the Management Committee shall not accelerate the payment of any
Company Stock Account maintained for a Participant if such acceleration would
cause the loss on any exempt treatment under the Plan for "insiders" for
securities laws purposes.

6.11 Payment of Burlington Northern Inc. Deferred Incentive Awards.
Incentive Awards that were deferred by a Participant under the Burlington
Northern Inc. Incentive Compensation Plan, together with interest accrued
thereon, shall be paid by the Company in accordance with the terms of this Plan
and shall be in lieu of payment by Burlington Northern Inc.

6.12 Payment Upon Change in Control. Notwithstanding any other
provision of this Plan, in the event of a Change in Control of the Company, the
maximum bonus amount attributable to the year in which the Change in Control

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<PAGE> 16
occurs shall become fully vested and payable within 30 days after the date of
the Change in Control.

For purposes of this Plan a "Change in Control" shall be deemed to
occur:

(i) if any person (as such term is used in sections 13(d) and
14(d)(2) of the Exchange Act (as defined in Section 7.7)) is or becomes
the "beneficial owner" (as defined in Rule 13d-3 of the Exchange Act),
directly or indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then outstanding
securities,

(ii) upon the first purchase of the Company's common stock
pursuant to a tender or exchange offer (other than a tender or exchange
offer made by the Company),

(iii) upon the approval by the Company's stockholders of a
merger or consolidation, a sale or disposition of all or substantially
all of the Company's assets or a plan of liquidation or dissolution of
the Company, or

(iv) if, during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board
cease for any reason to constitute at least a majority thereof, unless
the election or nomination for the election by the Company's
stockholders of each new director was approved by a vote of at least
two-thirds of the directors then still in office who were directors at
the beginning of the period.

SECTION 7

GENERAL PROVISIONS

7.1 Unfunded Obligation. The amounts to be paid to Participants
pursuant to this Plan are unfunded obligations of the Company. The Company is
not required to segregate any monies from its general funds, to create any
trusts, or to make any special deposits with respect to this obligation. Title
to and beneficial ownership of any investments, including trust investments,
which the Company may

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<PAGE> 17
make to fulfill this obligation shall at all times remain in the Company. Any
investments and the creation or maintenance of any trust or notional accounts
shall not create or constitute a trust or a fiduciary relationship between the
Management Committee or the Company and a Participant, or otherwise create any
vested or beneficial interest in any Participant or his or her Beneficiary or
his or her creditors in any assets of the Company whatsoever. The Participants
(and Beneficiaries) shall have no claim against the Company for any changes in
the value of any Accounts and shall be general unsecured creditors of the
Company with respect to any payment due under this Plan.

7.2 Incapacity of Participant or Beneficiary. If the Management
Committee finds that any Participant or Beneficiary to whom a payment is
payable under the Plan is unable to care for his or her affairs because of
illness or accident or is under a legal disability, any payment due (unless a
prior claim therefore shall have been made by a duly appointed legal
representative) at the discretion of the Management Committee, may be paid to
the spouse, child, parent or brother or sister of such Participant or
Beneficiary or to any person whom the Management Committee has determined has
incurred expense for such Participant or Beneficiary. Any such payment shall
be a complete discharge of the obligations of the Company under the provisions
of the Plan.

7.3 Nonassignment. The right of a Participant or Beneficiary to the
payment of any amounts under the Plan may not be assigned, transferred, pledged
or encumbered in any manner nor shall such right or other interests be subject
to attachment, garnishment, execution or other legal process.

7.4 No Right to Continued Employment. Nothing in the Plan shall be
construed to confer upon any Participant any right to continued employment with
the Employers, nor interfere in any way with the right of an Employer to
terminate the employment of such Participant at any time without assigning any
reason therefor.

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<PAGE> 18
7.5 Withholding Taxes. Appropriate taxes shall be withheld from the
Participant's Incentive Award with respect to all deferrals made under the Plan
and from all payments made to Participants and Beneficiaries pursuant to the
Plan.

7.6 Termination and Amendment. The Compensation and Nominating
Committee of the Board may from time to time amend, suspend or terminate the
Plan, in whole or in part, and if the Plan is suspended or terminated, the
Compensation and Nominating Committee may reinstate any or all of its
provisions. The Management Committee may also amend the Plan; provided,
however, it may not suspend or terminate the Plan, or substantially increase
the obligations of the Company under the Plan (provided, however, the addition
of new notional subaccounts for investments shall not be deemed an increase in
the obligations of the Company), or expand the classification of employees who
are eligible to participate in the Plan. No amendment, suspension or
termination of the Plan may impair the right of a Participant or his or her
Beneficiary to receive the benefit accrued hereunder prior to the effective
date of such amendment, suspension or termination.

7.7 Compliance with Securities Laws. It is the intention of the
Company that, so long as any of the Company's equity securities are registered
pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), this Plan shall be construed to meet the
requirements for exemption from Section 16 of the Exchange Act and, if any Plan
provision is later found to be contrary to meeting the requirements for such
exemption, that provision shall be deemed null and void. Notwithstanding
anything in the Plan to the contrary, the Compensation and Nominating
Committee, in its absolute discretion, may bifurcate the Plan so as to
restrict, limit or condition the use of any provision of the Plan to
Participants who are officers and directors subject to Section 16 of the
Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other Participants.

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<PAGE> 19
7.8 Applicable Law. Except to the extent preempted by applicable
federal law, the Plan shall be construed and governed in accordance with the
laws of the State of Texas.

-17-

<PAGE> 1

EXHIBIT 10.6

BURLINGTON RESOURCES INC.

DEFERRED COMPENSATION PLAN

As Amended and Restated Effective October 1, 1994
(Originally Effective January 1, 1989)

<PAGE> 2

BURLINGTON RESOURCES INC.

DEFERRED COMPENSATION PLAN

Table of Contents
-----------------

Page
----
<S> <C> <C>
Section 1 Definitions . . . . . . . . . . . . . . . . 1
Section 2 Administration . . . . . . . . . . . . . . . 3
Section 3 Participants . . . . . . . . . . . . . . . . 4
Section 4 Benefits . . . . . . . . . . . . . . . . . . 4
Section 5 General Provisions. . . . . . . . . . . . . . 11

</TABLE>

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<PAGE> 3
BURLINGTON RESOURCES INC.

DEFERRED COMPENSATION PLAN

PREAMBLE

WHEREAS, Burlington Resources Inc. (the "Company") established the
Burlington Resources Inc. Deferred Compensation Plan (the "Plan") effective
January 1, 1989 to permit key employees of the Company and its subsidiaries to
defer all or part of their base salary, in order for the Company to attract and
retain exceptional employees; and

WHEREAS, the Company desires to amend and restate the Plan to effect
certain changes;

NOW, THEREFORE, the Company does hereby amend and restate the Plan as
set forth herein, effective October 1, 1994.

SECTION 1

DEFINITIONS

For purposes of the Plan, the following terms shall have the meanings
indicated:

1.1 Account means a Memorandum Account, Special Deferral Memorandum Account,
and/or an Automatic Deferral Account, as each is defined in Section 4.4.

1.2 Base Salary means the Participant's base salary being paid by the Employer
for the applicable year or partial year, exclusive of bonuses and all
other items of compensation for the year.

1.3 Beneficiary means the person(s) designated by a Participant, on a form
provided by the Management Committee and filed with the Company's Human
Resources Department, to receive benefits from the Plan in the

<PAGE> 4
event of his or her death. A Participant may change his or her beneficiary
designation at any time. If no designated Beneficiary survives the
Participant, the Beneficiary shall be the Participant's surviving spouse
or, if none, his or her estate.

1.4 Board means the Board of Directors of the Company.

1.5 Company means Burlington Resources Inc., a Delaware corporation.

1.6 Company Stock Account means a notional subaccount of an Account credited
with Phantom Stock, as provided in Section 4.5.

1.7 Employer means the Company and its subsidiaries.

1.8 Fair Market Value means, as applied to a specific date, the mean between
the highest and lowest quoted selling prices at which the common stock of
the Company was sold on such date as reported inb the NYSE-Corporate
Transactions by The Wall Street Journal on such date or, if no Company
common stock was traded on such date, on the next preceding day on which
its common stock was so traded.

1.9 Interest Account means a notional subaccount of an Account credited with
interest, as provided in Section 4.5.

1.10 Management Committee means the committee appointed pursuant to Section
2.1 to administer the Plan.

1.11 Participant means each employee who participates in the Plan in
accordance with Section 3.

1.12 Permanent Disability means the Management Committee has found, upon the
basis of medical evidence satisfactory to it, that a Participant is
totally disabled, whether due to physical or mental condition, so as to
be prevented from engaging in further full-time employment by the
Employers and that such disability is reasonably expected to be
permanent or long-term.

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<PAGE> 5
1.13 Phantom Stock means a phantom or notional share of common stock of the
Company. A Participant shall not possess any rights of a stockholder of
the Company with respect to a share of Phantom Stock, including, without
limitation, rights concerning voting dividends. A share of Phantom
Stock shall be payable solely in cash under the Plan.

1.14 Plan means the Burlington Resources Inc. Deferred Compensation Plan
either in its previous or present form or as amended from time to time.

1.15 Termination means a Participant's termination of employment with the
Employers, including by reason of death, retirement or Permanent
Disability.

SECTION 2

ADMINISTRATION

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<PAGE> 6
SECTION 3

PARTICIPANTS

3.1 Participants. The Management Committee shall determine and
designate the executives of the Company and other key employees of the
Employers who are eligible to defer Base Salary under the Plan (the
"Participants"). Participants will be limited to those employees who, because
of their management or staff positions, have the principal responsibility for
the management, direction and success of the Company as a whole or a subsidiary
or a particular business unit thereof. Directors of the Company who are
full-time executives of the Company shall be eligible to participate in the
Plan. Each Participant must be a "member of a select group of management" or
"highly compensated," as those terms are defined in Section 201(2) of the
Employee Retirement Income Secuirty Act of 1974, as amended. Further, a
Participant shall not be eligible to make deferrals under the Plan with respect
to any year unless the Participant has also elected to make such year 401(k)
contributions to the Company's qualified defined contribution plan at the
highest contribution rate permitted under that plan and any reduction in his or
her 401(k) contribution rate under such qualified plan prior to making the
maximum 401(k) contribution for that year as permitted by the terms of the
qualified plan shall result in the automatic suspension of the Participant's
deferrals under this Plan for the remainder of that year.

SECTION 4

BENEFITS

4.1 Voluntary Deferrals. Before January 1 of any year (or, with
respect to employees who first become Participants during a year, on or before
the date on which they become Participants) each Participant may elect to have
the payment of all or a portion of his or her Base Salary for that year (or, if
later, so much of the year as commences on the day following the date on which
the employee becomes a

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<PAGE> 7
Participant) deferred until his or her Termination. The election shall be
irrevocable and shall be made on a form prescribed by the Management Committee,
which shall govern the amount deferred, the form of its payment pursuant to
Section 4.8 following the Participant's Termination, and, except as provided
below, the investment of the Participant's Memorandum Account for such deferral
period pending its payment. A Participant's deferral election shall apply only
to Base Salary earned during that calendar year or partial year, as the case
may be. If a Participant has not made a deferral election, the Base Salary
payable to him or her for that year shall be paid in accordance with the
Employer's normal payroll practices.

4.2 Special Deferrals. The Management Committee may, in its
discretion, approve deferred payments ("Special Deferrals") as follows.
Before January 1 of any year (or, with respect to employees who first become
Participants during a year, on or before the date on which they become
Participants) each Participant may elect to have the payment of all or a
portion of his or her Base Salary for that year (or, if later, so much of the
year as commences on the day following the date on which the employee becomes a
Participant) deferred until a date or dates specified by the Management
Committee, which, with respect to any Special Deferral invested in Phantom
Stock, must be more than six months after the effective date of such deferral.
The Participant's election shall be irrevocable and shall be made on a form
prescribed by the Management Committee. A Participant's Special Deferral
election shall apply only to Base Salary earned during that calendar year or
partial year, as the case may be. If a Participant has not made a Special
Deferral election, the Base Salary paid to him or her for that year (or partial
year) shall be paid in accordance with Section 4.1.

4.3 Automatic Deferrals. If the Management Committee determines
that all or part of the Base Salary to be paid to a Participant for a year
would be

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<PAGE> 8
nondeductible by the Company or a subsidiary for Federal tax purposes due to
the limitations of Section 162(m) of the Internal Revenue Code, so much of the
Base Salary that would not be deductible that year shall be deferred
automatically and, unless the Management Committee, in its sole discretion,
directs otherwise, credited to the Participant's Automatic Memorandum Account,
which, pursuant to the Participants' election, shall be invested and payable as
follows;

(a) invested in the Interest Account and payable in the first year or
years in which the Management Committee, in its sole discretion,
determines either such payment(s) would be deductible or to forego the
deduction;

(b) invested in the Interest Account and payable upon the
Participant's Termination; or

A Participant's election must be made prior to the deferral date and,
if (b) or (c) is elected, the election must also specify the form in which the
Account is to be paid as provided in Section 6.9. If the Participant does not
timely make an election with respect to an automatic deferral, he or she shall
be deemed to have elected option (a) above. Automatic Memorandum Accounts are
payable only in cash.

4.4 Memorandum Accounts. Each year the Company shall establish a
ledger or notional account (the "Memorandum Account") for each Participant who
has elected to defer payment of his or her Base Salary that year for the
purpose of reflecting the Company's obligation to pay the deferred Base Salary
for such year as specified pursuant to Section 4.8; provided, however, that
all Memorandum Accounts established for a Participant that are to be paid in
the same manner, i.e., a lump sum, 60 installments or 120 installments, may be
combined into a single Memorandum Account. Similarly, a separate Special
Memorandum Account shall be established for each Special Deferral for each
Participant; however, all Special Deferrals of a Participant that are to be
paid at the same time and in the same manner may be

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<PAGE> 9
combined into a single Special Memorandum Account. In addition, a separate
Automatic Memorandum Account shall be established for each automatic deferral
made pursuant to Section 4.3 with respect to a Participant.

4.5 Investment of Accounts. Except as provided below, each Account
shall accrue interest on the deferred Base Salary credited to such Account from
the date such Base Salary is credited to the Account through the date of its
distribution (the "Interest Account"). Such interest shall be credited to the
Interest Account at the end of each calendar quarter or such other periods as
may be determined by the Management Committee. The Management Committee shall
determine, in its sole discretion, the rate of interest to be credited
periodically to the Interest Accounts.

With respect to an election to defer (or an automatic deferral of)
Base Salary for any year beginning after 1993, a Participant may irrevocably
request that the Management Committee credit all or a specified percentage of
his or her Base Salary deferred that year in shares of Phantom Stock; however,
the Management Committee shall not be obligated to honor any such Participant's
request. If the Management Committee elects to honor any such request, it
shall establish a separate notional subaccount for such Participant under his
or her Account, which shall be credited with whole and fractional shares of
Phantom Stock periodically as of the payroll dates of the deferrals in such
year, and with phantom (notional) dividends with respect to the Phantom Stock,
which shall be credited as being reinvested in additional shares of Phantom
Stock (the "Company Stock Account"). All credits and debits to the Company
Stock Account shall be made based on the Fair Market Value per share of the
Company's common stock on the applicable date. If the Management Committee
chooses to not honor any Participant's request to invest his or her Account in
shares of Phantom Stock, the Participant's deferral automatically shall be held
in the Interest Account.

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<PAGE> 10
4.6 Special Phantom Stock Investment Elections. Each Participant
who has an Account under the Plan on October 1, 1994 (including with respect
to deferrals made in 1994) shall be given a one-time irrevocable election to
request that all or a specified percentage of his or her Account balances as of
that date, as elected by the Participant, be invested in the Company Stock
Account; however, the Management Committee shall not be obligated to honor any
such request. This election shall be in such form as the Management Committee
shall establish, and must be made prior to October 1, 1994.

4.7 Change in Section 16(b) Rules. Notwithstanding anything in the
Plan to the countrary, if the rules promulgated under Section 16(b) of the
Securities Act of 1934, as amended, are amended or interpreted by the
Securities and Exchange Commission to permit "insiders" to make investment
changes with respect to their accounts under cash only type of plans like the
Plan, the Management Committee, in its sole discretion, may amend the Plan in
any manner it deems appropriate to allow Participants the ability to request,
from time to time, investment changes with respect to their future deferrals
and/or their existing Account balances under the Plan and may also add
additional notional subaccounts under the Plan for such other investments as
the Management Committee deems appropriate to offer under the Plan.

4.8 Payment of Accounts. Except as provided below, upon a
Participant's Termination or on any Special Deferral payment date, the Company
shall pay to such Participant (or to his or her Beneficiary in case of the
Participant's death) an amount in cash equal to the balance then credited to
his or her affected Account(s) as follows:

(a) a lump sum payment; or

(b) in 60 consecutive substantially equal monthly installments; or

-8-

<PAGE> 11
whichever form of payment has been elected by the Participant. However,
if a Participant elects to receive the distribution of a Company Stock
Account in installments, his or her Company Stock Account automatically
shall be converted into an Interest Account as of the Participant's
date of Termination or Special Deferral payment date, as the case may
be.

Payment of Accounts shall commence or be made in the month following
the month in which the Participant's Termination or Special Deferral payment
date occurs; provided, however, if the Management Committee determines that all
or part of a payment to be made to a Participant pursuant to this Section 4.8
would be nondeductible by the Company or a subsidiary for Federal tax purposes
due to the limitations of Section 162(m) of the Internal Revenue Code, so much
of the payment, if any, that would be deductible in the year of Termination (or
Special Deferral payment date) shall be paid to the Participant immediately
following his or her Termination (or Special Deferral payment date) and, unless
the Management Committee, in its sole discretion, directs otherwise, the balance
of the Account shall be paid to the Participant (i) with respect to a
Termination, not later than the end of the third month of the next following
year and (ii) with respect to a Special Deferral payment date, in the first
year in which the Management Committee, in its sole discretion, determines
either such payment would be deductible or to forego such deduction, in each
case such delayed payment being based on the value of the Account at the time
of such actual payment.

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<PAGE> 12
occurring prior to January 1, 1995, unless such Termination is due to the
Participant's death, Permanent Disability occurring after October 1, 1994, or
involuntary termination by the Company or a subsidiary (whether a termination
is involuntary shall be determined by the Committee). Such distribution
election change shall be in such form as established by the Management Committee
and must be made prior to October 1, 1994.

4.9 Acceleration of Payments. Notwithstanding a Participant's
election to the contrary, the Management Committee, in its sole discretion, may
accelerate the payment of all or part of the unpaid balance of a Participant's
Account(s) in the event of the Participant's Termination, or upon its
determination that the Participant (or his or her Beneficiary in the case of
the Participant's death) has incurred a "severe financial hardship" resulting
from a sudden and unexpected illness or accident of such person or of a
dependent, a loss of such person's property due to casualty, or other similar
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of such person. The Management Committee in making its
determination of severe financial hardship may consider such factors and
require such information as it deems appropriate, but, in any case, payment may
not be made to the extent that such hardship is or may be relieved (i) through
reimbursement or compensation by insurance or otherwise or (ii) by liquidation
of such person's assets, to the extent liquidation of such assets will not
itself cause severe financial hardship. However, notwithstanding the
foregoing, the Management Committee shall not accelerate the payment of any
Common Stock

-10-
<PAGE> 13
Account maintained for a Participant if such acceleration would cause the loss
on any exempt treatment under the Plan for "insiders" for securities laws
purposes.

4.10 Payment of Burlington Northern Inc. Deferred Base Salary. Base
Salary that was deferred by a Participant under the Burlington Northern Inc.
Deferred Compensation Plan, together with interest accrued thereon, shall be
paid by the Company in accordance with the terms of this Plan and shall be in
lieu of payment by Burlington Northern Inc.

SECTION 5

GENERAL PROVISIONS

5.1 Unfunded Obligation. The amounts to be paid to Participants
pursuant to this Plan are unfunded obligations of the Company. The Company is
not required to segregate any monies from its general funds, to create any
trusts, or to make any special deposits with respect to this obligation. Title
to and beneficial ownership of any investments, including trust investments,
which the Company may make to fulfill this obligation shall at all times remain
in the Company. Any investments and the creation or maintenance of any trust or
notional accounts shall not create or constitute a trust or a fiduciary
relationship between the Management Committee or the Company and a Participant,
or otherwise create any vested or beneficial interest in any Participant or his
or her Beneficiary or his or her creditors in any assets of the Company
whatsoever. The Participants (and Beneficiaries) shall have no claim against
the Company for any changes in the value of any Accounts and shall be general
unsecured creditors of the Company with respect to any payment due under this
Plan.

5.2 Incapacity of Participant or Beneficiary. If the Mangement
Committee finds that any Participant or Beneficiary to whom a payment is
payable under the Plan is unable to care for his or her affairs because of
illness or accident or is under a legal disability, any payment due (unless a
prior claim therefore shall have

-11-
<PAGE> 14
been made by a duly appointed legal representative) at the discretion of the
Management Committee, may be paid to the spouse, child, parent or brother or
sister of such Participant or Beneficiary or to any person whom the Management
Committee has determined has incurred expense for such Participant or
Beneficiary. Any such payment shall be a complete discharge of the obligations
of the Company under the provisions of the Plan.

5.3 Nonassignment. The right of a Participant or Beneficiary to the
payment of any amounts under the Plan may not be assigned, transferred, pledged
or encumbered in any manner nor shall such right or other interests be subject
to attachment, garnishment, execution or other legal process.

5.4 No Right to Continued Employment. Nothing in the Plan shall be
construed to confer upon any Participant any right to continued employment with
the Employers, nor interfere in any way with the right of an Employer to
terminate the employment of such Participant at any time without assigning any
reason therefor.

5.5 Withholding Taxes. Appropriate taxes shall be withheld from the
Participant's Base Salary with respect to all deferrals made under the Plan and
from all payments made to Participants and Beneficiaries pursuant to the Plan.

5.6 Termination and Amendment. The Compensation and Nominating
Committee of the Board may from time to time amend, suspend or terminate the
Plan, in whole or in part, and if the Plan is suspended or terminated, the
Compensation Committee and Nominating Committee may reinstate any or all of its
provisions. The Management Committee may also amend the Plan; provided,
however, it may not suspend or terminate the Plan, or substantially increase
the obligations of the Company under the Plan (provided, however, the addition
of new notional subaccounts for investments shall not be deemed an increase in
the obligations of the Company), or expand the classification of employees who
are eligible to participate in the Plan. No amendment, suspension or
termination of the Plan may impair the

-12-
<PAGE> 15
right of a Participant or his or her Beneficiary to receive the benefit accrued
hereunder prior to the effective date of such amendment, suspension or
termination.

5.7 Compliance with Securities Laws. It is the intention of the
Company that, so long as any of the Company's equity securities are registered
pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), this Plan shall be construed to meet the
requirements for exemption from Section 16 of the Exchange Act and, if any Plan
provision is later found to be contrary to meeting the requirements for such
exemption, that provision shall be deemed null and void. Notwithstanding
anything in the Plan to the contrary, the Compensation and Nominating
Committee, in its absolute discretion, may bifurcate the Plan so as to
restrict, limit or condition the use of any provision of the Plan to
Participants who are officers and directors subject to Section 16 of the
Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other Participants.

5.8 Applicable Law. Except to the extent preempted by applicable
federal law, the Plan shall be construed and governed in accordance with the
laws of the State of Texas.

-13-

<PAGE> 1

EXHIBIT 10.8

BURLINGTON RESOURCES INC.

SUPPLEMENTAL BENEFITS PLAN

As Amended and Restated Effective October 1, 1994
(Originally Effective January 1, 1989)

<PAGE> 2

BURLINGTON RESOURCES INC.

SUPPLEMENTAL BENEFITS PLAN

Table of Contents
-----------------

<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 1 Definitions . . . . . . . . . . . 1
Section 2 Administration . . . . . . . . . . 3
Section 3 Participants . . . . . . . . . . . 4
Section 4 Benefits . . . . . . . . . . . . . 4
Section 5 General Provisions . . . . . . . . 11

</TABLE>

-i-

<PAGE> 3

BURLINGTON RESOURCES INC.

SUPPLEMENTAL BENEFITS PLAN

PREAMBLE

WHEREAS, Burlington Resources Inc. ("the Company") established the
Burlington Resources Inc. Supplemental Benefits Plan ("the Plan") effective
January 1, 1989 in order for the Company to attract and retain exceptional
employees; and

WHEREAS, the Company amended and stated the Plan as of January 1, 1990
and desires to amend and restate the Plan to effect certain changes;

NOW, THEREFORE, the Company does hereby amend and restate the Plan as
set forth herein, effective October 1, 1994.

SECTION 1

DEFINITIONS

For purposes of the Plan, the following terms shall have the meanings
indicated:

1.1 Beneficiary means the person(s) designated by a Participant, on a
form provided by the Management Committee and filed with the
Company's Human Resources Department, to receive benefits from the
Plan in the event of his or her death. A Participant may change his
or her beneficiary designation at any time. If no designated
Beneficiary survives the Participant, the Beneficiary shall be the
Participant's surviving spouse or, if none, his or her estate.

1.2 Board means the Board of Directors of the Company.

1.3 Code means the Internal Revenue Code of 1986, as amended.

1.4 Company means Burlington Resources Inc., a Delaware corporation.
<PAGE> 4
1.5 Company Stock Account means a notional subaccount of a Memorandum
Account credited with Phantom Stock, as provided in Section 4.5.

1.6 Deferred Compensation Plans means the Burlington Resources Inc.
Deferred Compensation Plan, the Company's Incentive Compensation
Plan and other similar plans maintained by an Employer and such
additional deferred compensation plans as may be designated by the
Company from time to time.

1.7 Employer means the Company and its subsidiaries.

1.8 Fair Market Value means, as applied to a specific date, the mean
between the highest and lowest quoted selling prices at which the
common stock of the Company was sold on such date as reported in the
NYSE Corporate Transactions by The Wall Street Journal on such date
or, if no Company common stock was traded on such date, on the next
preceding day on which its common stock was so traded.

1.9 Interest Account means a notional subaccount of a Memorandum Account
credited with interest, as provided in Section 4.5.

1.10 Management Committee means the committee appointed pursuant to
Section 2.1 to administer the Plan.

1.11 Participant means each employee who participates in the Plan in
accordance with Section 3.

1.12 Pension Plan means the Burlington Resources Inc. Pension Plan and
any pension plans maintained by an Employer.

1.13 Permanent Disability means the Management Committee has found, upon
the basis of medical evidence satisfactory to it, that a Participant
is totally disabled, whether due to physical or mental condition, so
as to be prevented from engaging in further full-time employment by
the Employers and that such disability is reasonably expected to be
permanent or long-term.

-2-
<PAGE> 5
1.14 Phantom Stock means a phantom or notional share of common stock of
the Company. A Participant shall not possess any rights of a
stockholder of the Company with respect to a share of Phantom Stock,
including, without limitation, rights concerning voting and
dividends. A share of Phantom Stock shall be payable solely in cash
under the Plan.

1.15 Plan means the Burlington Resources Inc. Deferred Compensation Plan
either in its previous or present form or as amended from time to
time.

1.16 RSP means the Burlington Resources Inc. Retirement Savings Plan.

1.17 Surviving Spouse means the person to whom surviving spouse death
benefits are to be paid pursuant to the terms of the Pension Plan.

1.18 Termination means a Participant's termination of employment with the
Employers, including by reason of death or retirement, but excluding
by reason of Permanent Disability.

SECTION 2

ADMINISTRATION

2.1 Management Committee. The Plan shall be administered by a
management committee (the Management Committee") consisting of such executives
of the Company as the Chief Executive Officer of the Company shall designate.
Subject to review by the Compensation and Nominating Committee of the Company's
Board of Directors, the Management Committee shall have the complete authority
and power to interpret the Plan, prescribe, amend and rescind rules relating to
its administration, select eligible Participants, determine a Participant's (or
Surviving Spouse's or Beneficiary's) right to a payment and the amount of such
payment, and to take all other actions necessary or desirable for the
administration of the Plan. All actions and decisions of the Management
Committee shall be final and binding upon all Participants, Surviving Spouses
and Beneficiaries. No member

-3-
<PAGE> 6
of the Management Committee shall vote on any matter that pertains solely to
himself or herself.

SECTION 3

PARTICIPANTS

3.1 Participants. The Management Committee shall determine and
designate the executives of the Company and other key employees of the
Employers who are eligible to receive benefits under the Plan (the
Participants"). Participants will be limited to those employees who, because
of their management or staff positions, have the principal responsibility for
the management, direction and success of the Company as a whole or a subsidiary
or a particular business unit thereof. Directors of the Company who are
full-time executives of the Company shall be eligible to participate in the
Plan. Each Participant must be a "member of a select group of management" or
"highly compensated," as those terms are defined in Section 201(2) of the
Employee Retirement Income Security Act of 1974, as amended.

SECTION 4

BENEFITS

4.1 Supplemental Pension Benefits. Upon a Participant's Termination,
the Company shall pay or cause to be paid to such Participant (or his or her
Surviving Spouse in the case of his or her death) supplemental pension benefits
under this Plan which, when combined with the amounts he or she is entitled to
receive under the Pension Plan, shall equal the retirement or Surviving Spouse
death benefits which would have been payable to the Participant or his or her
Surviving Spouse had the Pension Plan's benefit formula been applied:

(a) without regard to any of the limitations of Section 415
of the Code,

(b) by including in the Participant's compensation during the
period for which the Pension Plan benefits are computed,
to the extent not already done so under the Pension Plan,
any amount that has not

-4-
<PAGE> 7
been taken into account due to (i) the limitations of
Section 401(a)(17) of the Code, (ii) an elective reduction
of compensation by the Participant under Section 125 or
401(k) of the Code or (iii) the deferral of compensation
under a Deferred Compensation Plan, and

(c) by taking into account any service granted to the
Participant and any benefit formula adjustments required
by an employment contract with the Employer.

Supplemental pension benefits under this Section 4.1 shall be vested and
nonforfeitable to the same extent that the related benefits under the Pension
Plan are vested and nonforfeitable.

4.2 Supplemental RSP Benefits. Upon a Participant's Termination or
Permanent Disability, the Company shall pay or cause to be paid to such
Participant (or his or her Beneficiary in the case of his or her death)
supplemental RSP benefits calculated as described below. The Company shall
periodically determine the amount of any additional Employer matching
contributions that would have been credited to a Participant's account under
the RSP if his or her current election of Participant contributions had been
given effect and no adjustment of such contributions had occurred due to

(a) the maximum dollar limit under Section 415(c)(1)(A) of the
Code on RSP annual additions,

(b) the maximum limit under Section 401(a)(17) of the Code on
the Participant's compensation taken into account under
the RSP, and

(c) any further reductions in the Participant's compensation
taken into account under the RSP as a result of any
deferrals of compensation (i) elected by the Participant
pursuant to Section 125 or Section 401(k) of the Code or
(ii) under a Deferred Compensation Plan.

-5-
<PAGE> 8
From time to time, as determined by the Management Committee, the
Company shall allocate amounts equal to such additional Employer matching
contributions ("Employer Matching Contributions") to a notional ledger account
(the "Memorandum Account") for the Participant as of the time or times that
such amounts would have been contributed to the RSP if permitted thereunder.

Supplemental RSP benefits under this Section 4.2 shall be vested and
nonforfeitable to the same extent that the related Employer matching
contributions under the RSP are vested and nonforfeitable.

4.3 Other Supplemental Benefits. Upon a Participant's Termination or
Permanent Disability, the Company shall pay or cause to be paid to such
Participant (or his or her Beneficiary in the case of his or her death) other
supplemental benefits as determined by the Management Committee and contained
in the Participant's employment contract or other agreement with the Employer.
Other supplemental benefits under this Section 4.3 shall be vested and
nonforfeitable to the extent provided in the applicable employment contract or
agreement.

4.4 Determination of Lump Sum Supplemental Pension Benefit Payments.
The amount of a lump sum payment of supplemental pension benefits to a
Participant (or his or her Surviving Spouse in the event of the Participant's
Termination on account of death) shall be determined by calculating the benefit
according to the terms of the Pension Plan as a whole life annuity, then
calculating the present value of such benefit, using the actuarial assumptions
specified in the Pension Plan for determining benefits of equivalent value
except, in lieu of the Pension Benefit Guaranty Corporation ("PBGC") rates for
calculating lump sums specified in the Pension Plan, the interest rate shall be
the immediate PBGC rate in effect on January 1 of the year in which the lump
sum payment becomes payable (or such other date during such year as the
Management Committee, in its sole discretion, may designate).

-6-
<PAGE> 9
4.5 Investment of Accounts. Except as provided below, each
Memorandum Account shall accrue interest on the phantom Employer Matching
Contributions credited to such Account from such date of crediting through the
date of the distribution of such account. Such interest shall be credited to
the Memorandum Account at the end of each calendar quarter or such other
periods as may be determined by the Management Committee. The Management
Committee shall determine, in its sole discretion, the rate of interest to be
credited periodically to the Memorandum Accounts.

With respect to any year beginning after 1993, a Participant may
irrevocably request that the Management Committee credit all or a specified
percentage of his or her Employer Matching Contributions for that year in
shares of Phantom Stock; however, the Management Committee shall not be
obligated to honor any such Participant's request. If the Management Committee
elects to honor any such request, it shall establish a separate notional
subaccount for such Participant under his or her Memorandum Account, which
shall be credited with whole and fractional shares of Phantom Stock
periodically as of the payroll dates as of which the Employer Matching
Contributions for such year are to be credited, and phantom (notional)
dividends with respect to the credited Phantom Stock, which shall be credited
as being reinvested in additional shares of Phantom Stock (the "Company Stock
Account"). All credits and debits to the Company Stock Account shall be made
based on the Fair Market Value per share of the Company's common stock on the
applicable date. If the Management Committee chooses to not honor any such
Participant's request to invest his or her Memorandum Account in shares of
Phantom Stock, the Participant's Employer Matching Contributions automatically
shall be credited with interest.

4.6 Special Phantom Stock Investment Elections. Each Participant who
has a Memorandum Account under the Plan on October 1, 1994 (including with

-7-
<PAGE> 10
respect to Employer Matching Contributions credited or to be credited in 1994)
shall be given a one-time irrevocable election to request that all or a
specified percentage of his or her Memorandum Account as of that date, as
elected by the Participant, be invested in the Company Stock Account; however,
the Management Committee shall not be obligated to honor any such request.
This election shall be in such form as the Management Committee shall
establish, and must be made prior to October 1, 1994.

4.7 Change in Section 16(b) Rules. Notwithstanding anything in the
Plan to the contrary, if the rules promulgated under Section 16(b) of the
Securities Exchange Act of 1934, as amended, are amended or interpreted by the
Securities and Exchange Commission to permit "insiders" to make investment
changes with respect to their accounts under cash only type of plans like the
Plan, the Management Committee, in its sole discretion, may amend the Plan in
any manner it deems appropriate to allow Participants the ability to request,
from time to time, investment changes with respect to their future Employer
Matching Contributions and/or their existing Memorandum Account balance under
the Plan and may also add additional phantom subaccounts under the Plan for
such other investments as the Management Committee deems appropriate to offer
under the Plan.

4.8 Time and Manner of Payments. Except as provided below, upon a
Participant's Termination (and with respect to a Participant's RSP benefit,
upon his or her Permanent Disability), the Company shall pay to such
Participant (or to his or her Surviving Spouse or Beneficiary in case of the
Participant's death) an amount in cash equal to (i) the present value of the
Participant's accrued supplemental pension benefits under Section 4.1, and/or
(ii) the balance then credited to his or her Memorandum Account under Section
4.2 as follows:

(a) a lump sum payment; or

(b) in 60 consecutive substantially equal monthly
installments; or

-8-
<PAGE> 11
whichever form of payment has been elected by the Participant with
respect to such benefit. However, if a Participant elects to receive
the distribution of a Company Stock Account under Section 4.5 in
installments, his or her Company Stock Account automatically shall be
converted into an Interest Account as of the Participant's date of
Termination or Permanent Disability, as the case may be.

Payment of benefits shall commence or be made in the month following the
month in which the Participant's Termination or Permanent Disability date
occurs, whichever is applicable; provided, however, if the Management Committee
determines that all or part of a payment to be made to a Participant pursuant
to this Section 4.8 would be nondeductible by the Company or a subsidiary for
Federal tax purposes due to the limitations of Section 162(m) of the Internal
Revenue Code, so much of the payment, if any, that would be deductible in the
year of Termination (or Permanent Disability) shall be paid to the Participant
immediately following his or her Termination (or Permanent Disability date)
and, unless the Management Committee, in its sole discretion, directs
otherwise, the balance of the benefit shall be paid to the Participant not
later than the end of the third month of the next following year, with such
delayed payment being based on the value of the benefit at the time of such
actual payment.

Notwithstanding anything in the Plan to the contrary, each Participant
who has a benefit under Section 4.1 or 4.2 of the Plan on October 1, 1994 shall
be given a one-time, irrevocable election to elect, within the distribution
options specified above, the manner in which his or her supplemental pension
benefit and/or RSP Memorandum Account benefit are to be paid on his or her
Termination or Permanent Disability; provided, however, no such election shall
be effective with respect to any Termination or Permanent Disability occurring
prior to January 1, 1995, unless such Termination is due to the Participant's
death, Permanent Disability occurring after October 1, 1994, or involuntary
termination by the

-9-
<PAGE> 12
Company or a subsidiary (whether a termination is involuntary shall be
determined by the Committee). Such election shall be in such form as
established by the Management Committee and must be made prior to October 1,
1994.

Further, if the Management Committee determines at any time that
Participants may be given the ability to change their election as to the form
of distribution of their benefits without causing the loss of any exempt
treatment to "insiders" for securities laws purposes, the Management Committee
may amend the Plan to provide for such election changes as it deems
appropriate.

The payment of any other supplemental benefits pursuant to an employment
contract under Section 4.3 shall be made as provided in the employment
contract.

4.9 Acceleration of Payments. Notwithstanding a Participant's
election to the contrary, the Management Committee, in its sole discretion, may
accelerate the payment of all or part of a Participant's benefits under the
Plan in the event of the Participant's Termination (or the Participant's RSP
Memorandum Account benefit in the event of his or her Permanent Disability), or
upon its determination that the Participant (or his or her Surviving Spouse or
Beneficiary in the case of the Participant's death) has incurred a "severe
financial hardship" resulting from a sudden and unexpected illness or accident
of such person or of a dependent, a loss of such person's property due to
casualty, or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of such person. The
Management Committee in making its determination of severe financial hardship
may consider such factors and require such information as it deems appropriate,
but, in any case, payment may not be made to the extent that such hardship is
or may be relieved (i) through reimbursement or compensation by insurance or
otherwise or (ii) by liquidation of such person's assets, to the extent
liquidation of such assets will not itself cause severe financial hardship.
However,

-10-
<PAGE> 13
notwithstanding the foregoing, the Management Committee shall not accelerate
the payment of any Company Stock Account maintained for a Participant if such
acceleration would cause the loss on any exempt treatment under the Plan for
"insiders" for securities laws purposes.

SECTION 5

GENERAL PROVISIONS

5.1 Unfunded Obligation. The amounts to be paid to Participants
and/or their Surviving Spouses and Beneficiaries pursuant to this Plan are
unfunded obligations of the Company. The Company is not required to segregate
any monies from its general funds, to create any trusts, or to make any special
deposits with respect to this obligation. Title to and beneficial ownership of
any investments, including trust investments, which the Company may make to
fulfill this obligation shall at all times remain in the Company. Any
investments and the creation or maintenance of any trust or memorandum accounts
shall not create or constitute a trust or a fiduciary relationship between the
Management Committee or the Company and a Participant, or otherwise create any
vested or beneficial interest in any Participant or his or her Beneficiary or
his or her creditors in any assets of the Company whatsoever. The Participants
(and Beneficiaries) shall have no claim against the Company for any changes in
the value of any Memorandum Account and shall be general unsecured creditors of
the Company with respect to any payment due under this Plan.

5.2 Incapacity of Participant or Beneficiary. If the Management
Committee finds that any Participant, Surviving Spouse or Beneficiary to whom a
payment is payable under the Plan is unable to care for his or her affairs
because of illness or accident or is under a legal disability, any payment due
(unless a prior claim therefore shall have been made by a duly appointed legal
representative) at the discretion of the Committee, may be paid to the spouse,
child, parent or brother or

-11-
<PAGE> 14
sister of such Participant, Surviving Spouse or Beneficiary or to any person
whom the Management Committee has determined has incurred expense for such
Participant, Surviving Spouse or Beneficiary. Any such payment shall be a
complete discharge of the obligations of the Company under the provisions of
the Plan.

5.3 Nonassignment. The right of a Participant, Surviving Spouse or
Beneficiary to the payment of any amounts under the Plan may not be assigned,
transferred, pledged or encumbered in any manner nor shall such right or other
interests be subject to attachment, garnishment, execution or other legal
process.

5.5 Withholding Taxes. Appropriate taxes shall be withheld from a
Participant's compensation and all payments made to Participants, Surviving
Spouses and Beneficiaries pursuant to the Plan.

5.6 Termination and Amendment. The Compensation and Nominating
Committee of the Board of Directors of the Company may from time to time amend,
suspend or terminate the Plan, in whole or in part, and if the Plan is
suspended or terminated, the Compensation and Nominating Committee may
reinstate any or all of its provisions. The Management Committee may also
amend the Plan; provided, however, it may not suspend or terminate the Plan, or
substantially increase the obligations of the Company under the Plan (provided,
however, the addition of new notional subaccounts for investments shall not be
deemed an increase in the obligations of the Company), or expand the
classification of employees who are eligible to participate in the Plan. No
amendment, suspension or termination of the Plan may impair the right of a
Participant or his or her Surviving Spouse or

-12-
<PAGE> 15
Beneficiary to receive the benefits accrued hereunder prior to the effective
date of such amendment, suspension or termination.

If the Plan is terminated, Participants, Surviving Spouses and
Beneficiaries who have accrued benefits under the Plan as of the date of
termination will receive payment of such benefits at the times specified in the
Plan.

5.8 Applicable Law. Except to the extent preempted by applicable
federal law, the Plan shall be construed and governed in accordance with the
laws of the State of Texas.

-13-

<PAGE> 1
EXHIBIT 10.10

[BURLINGTON RESOURCES LETTERHEAD]

HAROLD E. HAUNSCHILD
Vice President Human Reources

December 7, 1994

Mr. Thomas H. O'Leary
5051 Westheimer
Houston, Texas 77056-2124

Dear Tom:

Your Employment Agreement with Burlington Resources Inc. (the
"Company") is dated October 20, 1988 and was previously amended on February 22,
1989, December 6, 1991, and December 8, 1993. The Employment Agreement, as
previously amended, will be referred to herein as the "Agreement". The Board
of Directors of the Company (the "Board") has deemed it advisable and in the
best interests of the Company and its stockholders to further amend the
Agreement with respect to the matters addressed herein. Accordingly, this
letter, when accepted by you in the space provided below, will amend the
agreement in the following particulars:

1. Term. The term of the Agreement is hereby extended
through December 15, 1996, unless sooner terminated by death, permanent
disabilities or the mutual agreement of the parties.

2. Pension Benefit. The vested supplemental pension
benefit described in Section 4 of the Agreement shall be calculated and
paid as if you had retired on December 31, 1994, without regard to the
actual date of your retirement, death or permanent disability. Such
payment shall be made in one lump sum and shall be paid promptly after
your retirement, death or permanent disability.

3. Enforcement. In the event that either party to the
Agreement is reasonably required to bring suit to enforce any of the
terms of the Agreement, as amended, the party determined to be in
breach or default shall pay the reasonable attorney's fees and costs of
the prevailing party.

This amendatory letter agreement shall be binding upon and inure to
the benefit of Thomas H. O'Leary and the Company and its successors and
assigns. The term "successor" shall include, without limitation, any
corporation which at any time, whether by merger, purchase or otherwise,
acquires all or substantially all of the assets or business of the Company. As
amended hereby, the agreement shall remain in full force and effect in
accordance with its terms.
<PAGE> 2
Mr. Thomas H. O'Leary
December 7, 1994
Page 2

If this letter correctly sets forth our agreement with respect to the
subject matter hereof, please sign the original and return it to me. Please
retain a copy for your records.

VERY TRULY YOURS,

BURLINGTON RESOURCES INC.

/s/ HAROLD E. HAUNSCHILD
By:_____________________________
Vice President
Its:____________________________

ACCEPTED AND AGREED TO
this 7th day of December, 1994.

/s/ THOMAS H. O'LEARY
____________________________
THOMAS H. O'LEARY

<PAGE> 1
EXHIBIT 10.10

[BURLINGTON RESOURCES LETTERHEAD]

November 8, 1994

Mr. Bobby S. Shackouls
5051 Westheimer
Houston, Texas 77056-2124

Dear Bobby:

The Employment Agreement for your employment with Meridian Oil Inc.
(The "Company") is dated April 30, 1993 and will be referred to herein as the
"Agreement". The Company has deemed it advisable and in the best interests of
the Company to amend the Agreement with respect to the matters addressed
herein. Accordingly, this letter, when accepted by you in the space provided
below, will amend the Agreement in the following particulars:

1. Position. Effective October 10, 1994, your position
will be that of President and Chief Executive Officer of the Company.

2. Base Salary. Effective October 10, 1994, you minimum
salary shall be $500,000 per annum or such higher rate as may be fixed
from time to time by the Compensation and Nominating Committee of the
Board of Directors ("Compensation Committee") of Burlington Resources
Inc. ("BR").

This amendatory letter agreement is being executed by BR on behalf of
itself, the Company and each of its affiliates and, as amended hereby, the
Agreement shall remain in full force and effect in accordance with its terms.
<PAGE> 2
Mr. Bobby S. Shackouls
November 8, 1994
Page 2

If this letter correctly sets forth our agreement with respect to the
subject matter hereof, please sign the original and return it to me. Please
retain a copy for your records.

VERY TRULY YOURS,

BURLINGTON RESOURCES INC.

/s/ HAROLD E. HAUNSCHILD
By:___________________________
Excecutive Vice President
Its:__________________________

ACCEPTED AND AGREED TO
this 8th day of November, 1994.

/s/ BOBBY S. SHACKOULS
____________________________
BOBBY S. SHACKOULS

<PAGE> 1
EXHIBIT 10.22

PETROTECH LONG TERM INCENTIVE PLAN

1. PURPOSE

The objective of the Petrotech Long Term Incentive Plan (hereinafter referred
to as "Petrotech Plan") is to attract and retain highly qualified managerial
and professional oil and gas employees.

2. PLAN PARTICIPANTS

The Petrotech Plan shall be limited to non-officer employees designated by the
Chief Executive Officer of Meridian who, because of their position and
responsibility, directly affect the success of Meridian Oil Inc.'s (hereinafter
referred to as "Meridian") exploration and production activities. Those
employees are hereinafter referred to as "Plan Participants".

3. ADMINISTRATION

The Petrotech Plan shall be administered by the Chief Executive Officer of
Meridian or such other person as the Chief Executive Officer shall designate
from time to time (hereinafter referred to as the "Administrator"). The
Administrator shall have the exclusive right and authority to manage and
administer as well as to amend, interpret or rescind any of the terms and
conditions of the Petrotech Plan. All actions taken by the Administrator shall
be binding upon all Plan Participants.

4. PLAN AWARDS

In July of each year the plan is in effect, an amount equal to twenty percent
of the annualized July 1 regular base pay of all Plan Participants shall be
deemed to be applied to a fund (hereafter referred to as the "Award Fund").
The Award Fund shall then be converted to "Stock Units" by dividing the Award
Fund by the Conversion Price. The Conversion Price is the average of the
closing prices of Burlington Resources Inc. common stock for the last twenty
trading days in June of each year. The Stock Units distributed to certain Plan
Participants shall be referred to as an "Award".
<PAGE> 2

Awards made to the Plan Participants shall be at the sole discretion of the
Administrator. Awards, if any, shall be made and communicated to Plan
Participants on or before August 15 of each year.

5. DISTRIBUTION AND CASH VALUE OF STOCK UNITS

By August 15 of the year following the year of each Award, twenty percent of
the Stock Units associated with that Award will be distributed to the Plan
Participant. The remaining eighty (80%) percent of the Stock Units associated
with that Award will be distributed annually over the subsequent four year
period.

The value of the Stock Units is immediately payable in cash to the Plan
Participant at the time of their distribution. The value is determined by
multiplying the number of Stock Units distributed, by the Conversion Price in
effect at the time of that distribution. Appropriate state and federal income
taxes, F.I.C.A. and other similar deductions will be withheld from any payment
made under this Petrotech Plan.

Except as otherwise provided in this Petrotech Plan, a Plan Participant must be
a full time employee, on short-term disability or on an approved Unpaid Leave
of Absence at the time the cash value of the Stock Units becomes payable to
receive payments based upon any Award.

6. DEATH/DISABILITY/RETIREMENT/SEVERANCE

If a Plan Participant dies, retires, is permanently disabled, or severed (as
defined below) on or subsequent to the date that an Award is made, a Special
Distribution, as defined below, will occur. The resulting payment shall be a
final payment and complete settlement for all Awards then outstanding and for
any benefits under the Petrotech Plan.

Permanent Disability--A Plan Participant shall be deemed permanently disabled
when the Administrator shall find upon the basis of medical evidence
satisfactory to the Administrator that the Plan Participant is totally
disabled, whether due to physical or mental condition, so as to be prevented
from engaging in any further employment by Meridian, and such disability will
be permanent and continuous during the remainder of the Plan Participant's
life.
<PAGE> 3
Retirement--A Plan Participant shall be deemed retired when the Plan
Participant leaves the employment of Meridian and is eligible to receive a
retirement benefit under the Burlington Resources Inc. Pension Plan.

Severance--A Plan Participant's employment shall be deemed severed if the Plan
Participant is included in a reduction in the work force or his/her position is
job abolished as defined by Company policy. Voluntary termination or
termination for poor performance or for cause or for any other reason other
than job abolishment or reduction in force will not be a severance under the
Petrotech Plan and will not result in a Special Distribution.

7. SPECIAL DISTRIBUTION

A Special Distribution is made in the event of a Plan Participant's death,
Disability, Retirement or Severance only. If such an event occurs on or
subsequent to the date that an Award is made, the Stock Units that would have
been distributed to the Plan Participant as part of the next year's usual
distribution shall be immediately distributed to the Plan Participant or
his/her beneficiary. The cash value of such Stock Units shall be determined by
multiplying the number of Stock Units by the last determined Conversion Price.
Payment of the cash value of the Stock Units shall be made within forty-five
(45) days of the event and shall be the full and final payment and complete
settlement for all Awards then outstanding and for any benefits under the
Petrotech Plan.

8. BENEFICIARY

Any person or persons may be named as the beneficiary of a Special Distribution
in the event of the Plan Participant's death. If a beneficiary is not named or
if the named beneficiary is not living at the time of the Plan Participant's
death, payment from the Special Distribution will be made to the first survivor
according to the following priority: spouse, children, parents, siblings, or
the executor for the benefit of the Plan Participant's estate.
<PAGE> 4
9. BENEFIT PLANS

Awards and any payments to Plan Participants under this Petrotech Plan shall
not be considered as part of a Plan Participant's salary for the calculation of
regular pay, compensation, allowance, pension or any other benefits unless
otherwise required by law or specific contractual obligation of Meridian.

10. UNFUNDED PLAN

Nothing in this Petrotech Plan shall be construed as requiring Meridian to
segregate any moneys from its general funds, or to create any trusts, or make
any special deposits or investments in connection with any amounts credited to
a Plan Participant. All funds deemed to be in the Award Fund and Stock Units
are acknowledged to be subject to Meridian's general creditors prior to any
actual payment of such funds to any Plan Participant.

11. ASSIGNMENT

The benefits of a Plan Participant or a designated beneficiary of a Plan
Participant under this Petrotech Plan may not be assigned. Any attempt to
transfer, assign, pledge, hypothecate, encumber or otherwise dispose of any
rights, privileges or benefits or the sale or levy or any attachment or similar
process upon the rights, privileges or benefits conferred hereby, shall be
invalid. Any attempt to do so shall result in voiding of any Awards and
payments thereunder.

12. NO CONTRACT OF EMPLOYMENT

This Petrotech Plan shall not constitute a contract or any right of
employment. Participation in this Petrotech Plan shall not affect Meridian's
right to discharge a Plan Participant and thereby terminate a Plan
Participant's participation in the Petrotech Plan and payout of Awards (except
as specifically provided in Paragraph 6).

13. NO RIGHT OF INSPECTION

Neither this Petrotech Plan nor any action taken thereunder by the
Administrator shall be construed as giving any Plan Participant or beneficiary
or any other person the right

<PAGE> 5

to an accounting, to examine the books, or to review or question the affairs,
management, or business decisions of Meridian relating to this Petrotech Plan.

14. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN

The Administrator may, from time to time, amend any provision of the Petrotech
Plan, or suspend or terminate the Petrotech Plan, in whole or in part, and if
any term or condition of the Petrotech Plan is suspended or terminated, the
Administrator may reinstate any or all the prior terms and conditions of the
Petrotech Plan. The Administrator may take such actions from time to time and
no Plan Participant has any vested or contract right under this Petrotech Plan.

In the event the Petrotech Plan is suspended or terminated by the
Administrator, the cash value of the Stock Units derived from previous Awards
may continue to be paid in the manner described in the above referenced
paragraphs entitled "Distribution of Stock Units" and "Special Distribution".

15. EFFECTIVE DATE

The Petrotech Plan is effective as of July 1, 1988, revised August 1,1993 and
July 1, 1994.

<PAGE> 1
EXHIBIT 10.23

BURLINGTON RESOURCES INC.

1994 RESTRICTED STOCK EXCHANGE PLAN

Effective July 6, 1994

<PAGE> 2

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
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<S> <C>
ARTICLE 1 ESTABLISHMENT AND PURPOSE . . . . . . . . . . 1

ARTICLE 2 DEFINITIONS . . . . . . . . . . . . . . . . . 1

ARTICLE 3 ADMINISTRATION . . . . . . . . . . . . . . . 3

ARTICLE 4 SHARE UNITS AVAILABLE FOR THE PLAN . . . . . 4

ARTICLE 5 GRANT OF SHARE UNITS . . . . . . . . . . . . 4

ARTICLE 6 PAYMENT OF VESTED SHARE UNITS . . . . . . . . 4

ARTICLE 7 GENERAL PROVISIONS . . . . . . . . . . . . . 5

</TABLE>

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<PAGE> 3

BURLINGTON RESOURCES INC.

1994 RESTRICTED STOCK EXCHANGE PLAN

ARTICLE I

ESTABLISHMENT AND PURPOSE

1.1 Establishment. Burlington Resources Inc. (the "Company") hereby
establishes the Burlington Resources Inc. 1994 Restricted Stock Exchange Plan
for the benefit of certain eligible executives of the Company and its
Subsidiaries.

1.2 Purpose. The purpose of this Plan is to permit the Company to
defer the vesting of Restricted Stock awards previously granted to certain
executives of the Company and its Subsidiaries, and thus to enhance the
retention value of those awards to the Company, by offering those executives
the opportunity to surrender to the Company their unvested shares of Restricted
Stock in exchange for Share Units under this Plan.

ARTICLE II

DEFINITIONS

2.1 Definitions. When used in this Plan, the following terms shall
have the respective meanings set forth below unless the context clearly
indicates otherwise:

(a) Beneficiary. The person or persons to whom payments are
to be paid pursuant to the terms of the Plan in the event of the
Participant's death.

(b) Board. The Board of Directors of the Company.

(c) Cause. The Company may terminate the Participant's
employment for "Cause." A termination for Cause is a termination
evidenced by a resolution adopted in good faith by two-thirds of the
Board that the Participant (i) willfully and continually failed to
substantially perform his duties with the Company or Subsidiary (other
than a failure resulting from the Participant's incapacity due to
physical or mental illness) which failure continued for a period of at
least 30 days after a written notice of demand for substantial
performance has been delivered to the Participant specifying the manner
in which the Participant had failed to substantially perform, or (ii)
willfully engaged in conduct which is demonstrably and materially
injurious to the Company or Subsidiary, monetarily or otherwise;
provided, however, that no termination of the Participant's employment
shall be for Cause as set forth in clause (ii) above until (x) there
shall have been delivered to the Participant a copy of a written notice
setting forth that the Participant was guilty of the conduct set forth
in clause (ii) and specifying the particulars thereof in detail, and (y)
the Participant shall have been provided an opportunity to be heard by
the Board (with the assistance of the Participant's counsel if the
Participant so desires). No act, nor failure to act, on the
Participant's part shall be considered "willful" unless he has acted, or
failed to act, with an absence of good faith and without a reasonable
belief that his action or failure to act was in the best interest of the
Company or Subsidiary. Notwithstanding anything contained in

<PAGE> 4

this Plan to the contrary, no failure to perform by the Participant
after notice of termination is given by the Participant shall
constitute Cause.

(d) Change in Control. As used in this Plan, a Change in
Control shall be deemed to occur

(i) upon the Company's obtaining actual knowledge that
any person (as such term is used in Sections 13(d) and 14(d)(2)
of the Exchange Act is or becomes the "beneficial owner" (as
defined in Rule 13d-3 of the Exchange Act) directly or
indirectly, of securities of the Company representing 20% or more
of the combined voting power of the Company's then outstanding
securities,

(ii) upon the first purchase of the Company's Common
Stock pursuant to a tender or exchange offer (other than a tender
or exchange offer made by the Company),

(iii) upon the approval by the Company's stockholders of
a merger or consolidation, a sale or disposition of all or
substantially all of the Company's assets or a plan of
liquidation or dissolution of the Company, or

(iv) if during any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board of Directors of the Company cease for any reason to
constitute at least a majority thereof, unless the election or
nomination for the election by the Company's stockholders of each
new director was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the
beginning of the period.

(e) Committee. The Compensation and Nominating Committee of
the Board.

(f) Common Stock. The common stock of the Company, par value
$.01 per share, or such other classes of share or other securities as
may be applicable pursuant to the provisions of Section 4.2.

(g) Company. Burlington Resources Inc.

(h) Exchange Act. The Securities Exchange Act of 1934,
as amended.

(i) Fair Market Value. The average of the highest and lowest
quoted selling prices at which Common Stock was sold on the applicable
Valuation Date as reported in the NYSE-Composite Transactions by The
Wall Street Journal on such date, or, if no Common Stock was traded on
such date, on the next preceding day on which Common Stock was so
traded. Notwithstanding the foregoing, Fair Market Value on the date of
a Change in Control shall be equal to the greater of (i) the highest
price per share of the Company's Common Stock as reported in the NYSE-
Composite Transactions by The Wall Street Journal during the 60-day
period ending on the date of the Change in Control, or (ii) if the
Change in Control is one described in clause (ii) or (iii) of Section
2.1(d), the highest price per share paid for the Company's Common Stock
in connection with such Change in Control.

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<PAGE> 5
(j) Participant. An executive of the Company or a Subsidiary
who has surrendered shares of Restricted Stock to the Company in
exchange for the grant of Share Units under the Plan.

(k) Permanent Disability. A Participant shall be deemed to
have become permanently disabled for purposes of this Plan if the
Committee finds, upon the basis of medical evidence satisfactory to it,
that the Participant is totally disabled, whether due to physical or
mental condition, so as to be prevented from engaging in further
employment by the Company or any of its Subsidiaries and that such
disability will be permanent and continuous during the remainder of his
life.

(l) Restricted Stock. The shares of unvested Restricted Stock
previously granted the executive by the Company, which are, in response
to an offer by the Committee, surrendered to the Company by a
Participant in exchange for a grant of Share Units under this Plan.

(m) Share Unit. An award under the Plan having an accounting
value equal to the Fair Market Value of one share of Common Stock.

(n) Subsidiary. A corporation or other form of business
association designated by the Committee as a subsidiary for purposes of
the Plan.

(o) Valuation Date. The date of a Participant's termination
of employment with the Company and its Subsidiaries.

ARTICLE III

ADMINISTRATION

The Plan shall be administered by the Committee. With respect to grants
made under the Plan to officers and directors of the Company who are subject to
Section 16 of the Exchange Act and to the extent required to exempt the Plan
from Section 16 of the Exchange Act, the Committee shall be constituted at all
times so as to meet the requirements of Rule 16b-3 promulgated under Section
16(b) of the Exchange Act so long as any of the Company's equity securities are
registered pursuant to Section 12(b) or 12(g) of the Exchange Act.

Subject to the terms of the Plan and applicable law, the Committee shall
have the full power, authority and discretion to: (i) determine which
executives shall be eligible to become Participants and how many Share Units
shall be granted to each Participant; (ii) interpret, construe and administer
the Plan and any instrument or agreement relating to Share Units granted under
the Plan; (iii) establish, amend, suspend, or waive such rules and regulations
and appoint such agents as it shall deem appropriate for the proper
administration of the Plan; (iv) make a determination as to the right of any
person to receive payment with respect to vested Share Units; and (v) make any
other determinations and take any other actions that the Committee deems
necessary or desirable for the administration of the Plan.

Each member of the Committee, while serving as such, shall be considered
to be acting in his or her capacity as a director of the Company. Members of
the Board and members of the Committee shall be fully protected in relying in
good faith upon the advice of counsel and shall incur no liability except for
gross negligence or willful misconduct in the performance of their duties.

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<PAGE> 6
ARTICLE IV

SHARE UNITS AVAILABLE FOR THE PLAN

4.1 Share Units. Subject to Section 4.2, the maximum number of Share
Units which may be granted under the Plan is 120,000. If additional Share
Units are needed under the Plan after such initial number has been fully
utilized and prior to the expiration of the Plan, the Committee shall authorize
such additional Share Units as it shall determine to be necessary under the
Plan.

4.2 Recapitalization. In the event of a recapitalization, stock
split, stock dividend, exchanges of shares, merger, reorganization, change in
the corporate structure of the Company or similar event, the Committee may make
appropriate adjustments in the number of Share Units authorized for the Plan
and, with respect to outstanding Share Units, the Committee may make
appropriate adjustments in the number of Share Units.

ARTICLE V

GRANT OF SHARE UNITS

5.1 Grants of Share Units. Each Participant shall be granted a
number of Share Units equal to 120% (rounded up to the nearest whole number) of
the number of shares of Restricted Stock such Participant surrenders in
response to an offer from the Committee hereunder to the Company for
cancellation.

5.2 Dividends. On each date that the Company pays a dividend or
makes a distribution with respect to its Common Stock, a corresponding dividend
or distribution shall be deemed to be credited to each outstanding Share Unit
and shall be deemed reinvested in additional Share Units or fractions thereof
based on the Fair Market Value of a share of Common Stock on such date.

5.3 Vesting. Share Units granted to a Participant hereunder shall
become vested (nonforfeitable) on the second anniversary of the date the
restrictions on the Participant's surrendered shares of Restricted Stock would
have lapsed; however, all outstanding Share Units shall become fully vested in
the event of a Change in Control. Further, in the event a Participant's
employment with the Company and its Subsidiaries is terminated due to death or
Permanent Disability, the Participant automatically shall be fully vested as of
the date of such termination in all of the Participant's outstanding Share
Units. Participants who terminate their employment for any other reason prior
to full vesting shall not be entitled to receive payment from the Company or
its Subsidiaries for any Share Units which are not vested as of the time they
cease employment with the Company and its Subsidiaries.

5.4 Share Unit Agreements. The Committee shall enter into written
agreements with each Participant setting forth the grant of Share Units
hereunder and the terms applicable to such grant consistent with this Plan.

ARTICLE VI

PAYMENT OF VESTED SHARE UNITS

6.1 Entitlement to Payment. Subject to Sections 6.2 and 6.3 below,
each Share Unit which is vested shall entitle the Participant or his
Beneficiary to receive

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<PAGE> 7
from the Participant's employer a lump sum payment in cash on or as soon as
practicable, and within 10 days, following the applicable Valuation Date. The
amount of such payment shall be determined by multiplying the number of such
Participant's or Beneficiary's vested Share Units by the Fair Market Value of a
share of Common Stock on the applicable Valuation Date.

6.2 Conversion of Share Units Following a Change in Control.
Notwithstanding anything in the Plan to the contrary, if the Common Stock of
the Company does not remain listed on the New York Stock Exchange following a
Change in Control, the Fair Market Value of each Participant's Share Units at
such time shall be converted into a separate ledger account for such
Participant ("Memorandum Account"), which shall be credited with interest at
the end of each calendar quarter or such other periods as may be determined by
the Committee until the Memorandum Account is paid. The Committee shall
determine the rate of interest periodically to be credited to the Memorandum
Account. If a Memorandum Account is established, in lieu of payment pursuant
to Section 6.1, a Participant shall be entitled to receive from the
Participant's Employer a lump sum payment in cash equal to the value of the
Participant's Memorandum Account on or as soon as practicable, and within 10
days, following the Valuation Date.

6.3 Delayed Payment. If the Committee determines that all or part of
a payment to be made to a Participant pursuant to Section 6.1 or 6.2 would be
nondeductible by the Company or Subsidiary for Federal tax purposes due to the
limitations of Section 162(m) of the Internal Revenue Code, so much of the
payment, if any, that would be deductible in the year of termination shall be
paid to the Participant immediately following his or her termination of
employment and the balance of the payment, with accrued interest as provided
below, shall be paid to the Participant as soon as practicable in the next
following year, but not later than the end of the third month of such following
year. Any amount not paid pursuant to Section 6.1 or 6.2 in the year of
termination shall be credited with interest at such times and at such rate as
may be determined from time to time by the Committee until paid by the
Participant's employer.

ARTICLE VII

GENERAL PROVISIONS

7.1 Unfunded Obligations. The amounts to be paid to Participants
pursuant to this Plan with respect to Share Units are unfunded obligations.
Neither the Company nor any Subsidiary is required to segregate any monies from
its general funds, to create any trusts, or to make any special deposits with
respect to this obligation. Title to and beneficial ownership of any
investments including trust investments which the Company or Subsidiary may
make to fulfill this obligation shall at all times remain in the Company or
Subsidiary. Any investments and the creation or maintenance of any trust shall
not create or constitute a trust or a fiduciary relationship between the
Committee, the Company, or any Subsidiary and a Participant, or otherwise
create any vested or beneficial interest in any Participant or his Beneficiary
or his creditors in any assets of the Company or its Subsidiaries whatsoever.
The Participants shall have no claim against the Company for any changes in the
value of any assets which may be invested or reinvested by the Company or
Subsidiary with respect to this Plan.

7.2 Other Benefits. Grants, vesting, or payment with respect to
Share Units shall not be considered as part of a Participant's salary or used
for the calculation of any other pay, allowance, pension or other benefit
unless otherwise permitted by other

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<PAGE> 8
benefit plans provided by the Company or its Subsidiaries, or required by law
or by contractual obligations of the Company or its Subsidiaries.

7.3 Beneficiary. A Participant's designation of a Beneficiary shall
be on a form provided by the Committee, executed by the Participant (with the
consent of the Participant's spouse, if required by the Committee for reasons
of community property or otherwise), and delivered to the Committee. A
Participant may change his or her Beneficiary designation at any time. If no
Beneficiary is designated, if the designation is ineffective, or in the event
the Beneficiary dies before payment is made, the payment shall be made to the
Participant's spouse or, if there is no surviving spouse, to his or her lineal
descendants, pro rata, or, if there is no surviving spouse or lineal
descendants, to the Participant's estate. Notwithstanding the foregoing,
however, a Participant's Beneficiary shall be determined under applicable state
law if such state law does not recognize Beneficiary designations under plans
of this sort and is not preempted by laws which recognize the provisions of
this Section 7.3.

7.4 Withholding Taxes. Appropriate tax withholding shall be made by
the Company or Subsidiary from payments to a Participant (or a Beneficiary)
pursuant to this Plan, or from other wages of the Participant, as required
under applicable law. In addition, upon the vesting of any Share Units granted
under the Plan, the Company or Subsidiary shall make appropriate tax
withholdings from the other wages of the Participant or make other arrangements
therefor satisfactory to the Committee.

7.5 Nonassignment. The right of a Participant or Beneficiary to any
payment under the Plan may not be assigned, transferred, pledged or encumbered
nor shall such right or other interests be subject to attachment, garnishment,
execution or other legal process.

7.6 No Right to Continued Employment or Future Grants. Nothing in
the Plan shall be construed to confer upon any Participant any right to
continued employment with the Company or a Subsidiary, nor interfere in any way
with the right of the Company or a Subsidiary to terminate the employment of
such Participant at any time without assigning any reasons therefor. The grant
of a Share Unit to a Participant shall not give the Participant any right to
subsequent grants of Share Units under the Plan.

7.7 Leaves of Absence. Leaves of absence for such periods and
purpose conforming to the personnel policy of the Company or of its
Subsidiaries, as applicable, shall not be deemed termination of employment.

7.8 Transfers. In the event a Participant is transferred from the
Company to a Subsidiary, or vice versa, or between Subsidiaries or is promoted
or given different responsibilities, the Share Units granted to the Participant
prior to such date shall not be affected.

7.9 Shareholder Rights. The grant of a Share Unit shall not entitle
a Participant or Beneficiary to any dividend, voting or other rights as a
shareholder of the Company.

7.10 Termination and Amendment. The Board or the Committee may from
time to time amend, suspend or terminate the Plan in whole or in part;
provided, however, no such action shall be allowed to impair the right of a
Participant to receive payment with respect to Share Units (or a Memorandum
Account) that have vested as of such date without the consent of such
Participant. Upon termination of the Plan, the

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<PAGE> 9
Committee may provide for the immediate payment of all Share Units (or
Memorandum Accounts, as the case may be), notwithstanding that the Participants
have not terminated employment. The Committee may amend the Plan, without
Board approval, to ensure that the Company may obtain any regulatory approval
or to accomplish any other reasonable purpose, provided that the amendments do
not materially increase the cost of the Plan to the Company and its
Subsidiaries, and do not substantially alter the level of benefits under the
Plan. If the Plan is suspended or terminated, the Committee may reinstate any
or all of its provisions.

7.11 Applicable Law. The Plan shall be construed and governed in
accordance with the laws of the State of Texas, except that it shall be
construed and governed in accordance with applicable federal law in the event
that such federal law preempts state law.

7.12 It is the intention of the Company that, so long as any of the
Company's equity securities are registered pursuant to Section 12(b) or 12(g)
of the Exchange Act, this Plan shall be construed to meet the requirements for
exemption from Section 16 of the Exchange Act and, if any Plan provision is
later found to be contrary to meeting the requirements for such exemption, that
provision shall be deemed null and void. Notwithstanding anything in the Plan
to the contrary, the Board, in its absolute discretion, may bifurcate the Plan
so as to restrict, limit or condition the use of any provision of the Plan to
Participants who are officers and directors subject to Section 16 of the
Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other Participants.

7.13 Effective Date of Plan. Upon approval by the Committee, the Plan
shall become effective on July 6, 1994.

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<PAGE> 1
EXHIBIT 10.24

BURLINGTON RESOURCES INC.

$300,000,000

SHORT-TERM REVOLVING CREDIT AGREEMENT

Dated as of

July 20, 1994

CITIBANK, N.A., as Agent
<PAGE> 2
TABLE OF CONTENTS

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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01. Certain Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.02. Computation of Time Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 1.03. Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01. The A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.02. Making the A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.03. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.04. Reduction of the Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.05. Repayment of A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.06. Interest on A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.07. Additional Interest on Eurodollar
Rate Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.08. Interest Rate Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.09. Voluntary Conversion of A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 2.10. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 2.11. Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.12. Increased Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.13. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.14. Payments and Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.15. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.16. Sharing of Payments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 2.17. Evidence of Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.18. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.19. The B Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.20. Increase of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 2.21. Renewal of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

ARTICLE III
CONDITIONS OF EFFECTIVENESS AND LENDING

SECTION 3.01. Conditions Precedent to
Effectiveness of this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 3.02. Conditions Precedent to Each
A Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 3.03. Conditions Precedent to Each
B Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
</TABLE>
<PAGE> 3
<TABLE>
<S> <C> <C>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES

SECTION 4.01. Representations and Warranties of
the Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

ARTICLE V
COVENANTS OF THE BORROWER

SECTION 5.01. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 5.02. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 5.03. Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

ARTICLE VI
EVENTS OF DEFAULT

SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

ARTICLE VII
THE AGENT

SECTION 7.01. Authorization and Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 7.02. Agent's Reliance, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 7.03. Citibank and Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 7.04. Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 7.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 7.06. Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

ARTICLE VIII
MISCELLANEOUS

SECTION 8.01. Amendments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 8.02. Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 8.03. No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 8.04. Costs and Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 8.05. Right of Set-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 8.06. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 8.07. Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 8.08. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 8.09. Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 8.10. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 8.11. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
</TABLE>

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<PAGE> 4
EXHIBITS

Exhibit A Form of A Note
Exhibit B Form of B Note
Exhibit C Form of Notice of A Borrowing
Exhibit D Form of Notice of B Borrowing
Exhibit E Form of Assignment and Acceptance
Exhibit F-1 Form of Commitment Increase Agreement
Exhibit F-2 Form of New Lender Agreement
Exhibit G Form of Opinion of Vice President, Law
for Borrower
Exhibit H Form of Opinion of Fried, Frank, Harris,
Shriver & Jacobson, New York Counsel for
Borrower
Exhibit I Form of Opinion of Counsel to Citibank,
N.A., as Agent
Exhibit J Form of Process Agent Letter
Exhibit K Form of Designation Agreement

SCHEDULES

Schedule I -- Domestic and Eurodollar Lending Offices
Schedule II -- Material Subsidiaries

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<PAGE> 5
SHORT-TERM REVOLVING CREDIT AGREEMENT

Dated as of July 20, 1994

BURLINGTON RESOURCES INC., a Delaware corporation (the
"Borrower"), the financial institutions (the "Initial Lenders") listed on the
signature pages hereof, and CITIBANK, N.A. ("Citibank") as agent (the "Agent")
for the Lenders hereunder, agree as follows:

ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):

"A Advance" means an advance by a Lender to the Borrower as
part of an A Borrowing, and refers to a Base Rate Advance or a
Eurodollar Rate Advance (each of which shall be a "Type" of A
Advance).

"A Borrowing" means a borrowing consisting of A Advances of
the same Type made on the same day by the Lenders pursuant to Section
2.01 and, in the case of Eurodollar Rate Advances, having Interest
Periods of the same duration, it being understood that there may be
more than one A Borrowing on a particular day.

"A Note" means a promissory note of the Borrower payable to
the order of any Lender, in substantially the form of Exhibit A
hereto, evidencing the aggregate indebtedness of the Borrower to such
Lender resulting from the A Advances made by such Lender.

"Advance" means an A Advance or a B Advance.

"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
The term "controls" (including the terms "controlled by" or "under
common control with") means, with respect to any Person, the
possession, direct or indirect, of the power to vote 10% or more (or
in the case of an "Affiliate" of any Lender, 5% or more) of the
securities having ordinary voting power for the election of directors
of such Person
<PAGE> 6
or to direct or cause the direction of the management and policies of
such Person, whether through ownership of voting securities or by
contract or otherwise.

"Applicable Lending Office" means, with respect to each
Lender, (i) in the case of an A Advance, such Lender's Domestic
Lending Office in respect of Base Rate Advances and such Lender's
Eurodollar Lending Office in respect of Eurodollar Rate Advances and
(ii) in the case of a B Advance, the office of such Lender notified by
such Lender to the Agent as its Applicable Lending Office with respect
to such B Advance.

"Arranger" means Citicorp Securities, Inc.

"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender (other than a Designated Bidder) and an
Eligible Assignee, and accepted by the Agent, in substantially the
form of Exhibit E hereto.

"B Advance" means an advance by a Lender to the Borrower as
part of a B Borrowing resulting from the auction bidding procedure
described in Section 2.19.

"B Borrowing" means a borrowing consisting of simultaneous B
Advances to the Borrower from each of the Lenders whose offer to make
one or more B Advances as part of such borrowing has been accepted by
the Borrower under the auction bidding procedure described in Section
2.19, it being understood that there may be more than one B Borrowing
on a particular day.

"B Note" means a promissory note of the Borrower payable to
the order of any Lender, in substantially the form of Exhibit B
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from a B Advance made by such Lender.

"B Reduction" has the meaning specified in Section 2.01.

"Base Rate" means, for each day in any period, a fluctuating
interest rate per annum as shall be in effect from time to time which
rate per annum shall at all times for such day be equal to the highest
of:

(a) The rate of interest announced publicly by
the Agent in the United States with respect to

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<PAGE> 7
loans made in the United States, from time to time, as the
Agent's base or prime rate as in effect for such day;

(b) The sum (adjusted to the nearest 1/16 of one
percent or, if there is no nearest 1/16 of one percent, to the
next higher 1/16 of one percent) of (i) 1/2 of one percent per
annum, plus (ii) the rate obtained by dividing (A) the latest
three-week moving average of secondary market morning offering
rates in the United States for three-month certificates of
deposit of major United States money market banks, such
three-week moving average (adjusted to the basis of a year of
365 or 366 days, as the case may be) being determined weekly
on each Monday (or, if any such day is not a Business Day, on
the next succeeding Business Day) for the three-week period
ending on the previous Friday by the Agent on the basis of
such rates reported by certificate of deposit dealers to and
published by the Federal Reserve Bank of New York or, if such
publication shall be suspended or terminated, on the basis of
quotations for such rates received by the Agent from three New
York certificate of deposit dealers of recognized standing
selected by the Agent, by (B) a percentage equal to 100% minus
the average of the daily percentages specified during such
three-week period by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, but not limited to, any
emergency, supplemental or other marginal reserve requirement)
for the Agent in respect of liabilities consisting of or
including (among other liabilities) three-month U.S. dollar
nonpersonal time deposits in the United States each in the
amount of $100,000 or more, plus (iii) the average during such
three-week period of the annual assessment rates estimated by
the Agent for determining the then current annual assessment
payable by the Agent to the Federal Deposit Insurance
Corporation (or any successor) for insuring U.S. dollar
deposits of the Agent in the United States; and

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<PAGE> 8
"Base Rate Advance" means an A Advance which bears interest as
provided in Section 2.06(a)(i).

"Borrowing" means an A Borrowing or a B Borrowing.

"Business Day" means a day of the year on which banks are not
required or authorized to close in New York, New York and, if the
applicable Business Day relates to any Eurodollar Rate Advances, on
which dealings are carried on in the London interbank market.

"Capitalization" means the sum (without duplication) of (i)
consolidated Debt of the Borrower and its consolidated Subsidiaries,
plus (ii) the aggregate amount of Guaranties by the Borrower or its
consolidated Subsidiaries and letters of credit issued for the account
of the Borrower or any consolidated Subsidiary of the Borrower, plus
(iii) the sum of the preferred stock and common stockholders' equity
of the Borrower.

"Commitment" has the meaning specified in Section 2.01.

"Consolidated Tangible Net Worth" means, on a consolidated
basis, the excess of (i) the sum of the preferred stock and common
stockholders' equity of the Borrower, over (ii) the intangible assets
of the Borrower and its consolidated Subsidiaries.

"Convert", "Conversion" and "Converted" each refers to a
conversion of A Advances of one Type into A Advances of another Type
pursuant to Section 2.08, 2.09 or 2.13.

"Debt" of any Person means, without duplication (i)
indebtedness of such Person for borrowed money, (ii) obligations of
such Person (other than any portion of any trade payable obligation of
such Person which shall not have remained unpaid for 91 days or more
from the original due date of such portion) to pay the deferred
purchase price of property or services, and (iii) obligations of such
Person as lessee under leases which shall have been or should be, in
accordance with generally accepted accounting principles, recorded as
capital leases, except that where any such indebtedness or obligation
of such Person is made jointly, or jointly and severally, with any
third party or parties, which are not the Borrower or any of its
consolidated Subsidiaries, the amount thereof for the purposes of this
definition only shall be the pro rata portion thereof payable by

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<PAGE> 9
such Person, so long as such third party or parties have not defaulted
on its or their joint and several portions thereof.

"Designated Bidder" means (a) an Affiliate of a Lender or (b)
a special purpose corporation that is engaged in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its
business and that issues (or the parent of which issues) commercial
paper rated at least "Prime-1" by Moody's or "A-1" by S&P or a
comparable rating from the successor of either of them, that, in the
case of either clause (a) or (b) above, (i) is organized under the
laws of the United States or any state thereof, (ii) shall have become
a party hereto pursuant to subsections (e), (f) and (g) of Section
8.07, and (iii) is not otherwise a Lender. Notwithstanding the
foregoing, each Designated Bidder shall be subject to the written
consent of the Borrower and the Agent, such consent not to be
unreasonably withheld.

"Designation Agreement" means a designation agreement entered
into by the Borrower, a Lender (other than a Designated Bidder) and a
Designated Bidder, and accepted by the Agent, in substantially the
form of Exhibit K hereto.

"Domestic Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and
Acceptance or Increase Agreement pursuant to which it became a Lender,
or such other office of such Lender as such Lender may from time to
time specify to the Borrower and the Agent.

"Effective Federal Funds Rate" means, for any day, the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York or, if such rate is not so published for any day which is
a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers
of recognized standing selected by it.

"Eligible Assignee" means, with respect to any particular
assignment under Section 8.07, any bank or

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<PAGE> 10
other financial institution approved in writing by the Borrower
expressly with respect to such assignment and, except as to such an
assignment by Citibank so long as Citibank is the Agent hereunder, the
Agent as an Eligible Assignee for purposes of this Agreement, provided
that neither the Agent's nor the Borrower's approval shall be
unreasonably withheld.

"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated
and rulings issued from time to time thereunder.

"ERISA Affiliate" means any Person who is a member of the
Borrower's controlled group within the meaning of Section
4001(a)(14)(A) of ERISA.

"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.

"Eurodollar Lending Office" means, with respect to each
Lender, the office of such Lender specified as its "Eurodollar Lending
Office" opposite its name on Schedule I hereto or in the Assignment
and Acceptance or Increase Agreement pursuant to which it became a
Lender (or, if no such office is specified, its Domestic Lending
Office) or such other office of such Lender as such Lender may from
time to time specify to the Borrower and the Agent.

"Eurodollar Rate" means, for any Interest Period for each
Eurodollar Rate Advance comprising part of the same A Borrowing, the
interest rate per annum equal to the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not
such a multiple) of the rate per annum at which deposits in U.S.
dollars are offered by the principal office of each of the Reference
Banks in London, England, to prime banks in the London interbank
market at 11:00 A.M. (London, England time) two Business Days before
the first day of such Interest Period in an amount comparable to the
amount of such A Borrowing and for a period equal to such Interest
Period. The Eurodollar Rate for the Interest Period for each
Eurodollar Rate Advance comprising part of the same A Borrowing shall
be determined by the Agent on the basis of applicable rates furnished
to and received by the Agent from the Reference Banks two

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<PAGE> 11
Business Days before the first day of such Interest Period, subject,
however, to the provisions of Section 2.08.

"Eurodollar Rate Advance" means an A Advance which bears
interest determined by reference to the Eurodollar Rate, as provided
in Section 2.06(a)(ii).

"Eurodollar Rate Margin" means 0.23% per annum.

"Eurodollar Reserve Percentage" of any Lender for any Interest
Period for any Eurodollar Rate Advance means the reserve percentage
applicable during such Interest Period under regulations issued from
time to time by the Board of Governors of the Federal Reserve System
(or if more than one such percentage shall be so applicable, the daily
average of such percentages for those days in such Interest Period
during which any such percentage shall be so applicable) for
determining the maximum reserve requirement (including, but not
limited to, any emergency, supplemental or other marginal reserve
requirement) for such Lender with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities having a term
equal to such Interest Period.

"Events of Default" has the meaning specified in Section 6.01.

"Facility Fee Percentage" means 0.08% per annum.

"Guaranty", "Guaranteed" and "Guaranteeing" each means any act
by which a Person assumes, guarantees, endorses or otherwise incurs
direct or contingent liability in connection with, or agrees to
purchase or otherwise acquire or otherwise assures a creditor against
loss in respect of, any Debt of any Person other than the Borrower or
any of its consolidated Subsidiaries (excluding (i) any liability by
endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business, and (ii) any
liability in connection with obligations of the Borrower or any of its
consolidated Subsidiaries, including, without limitation, obligations
under any conditional sales agreement or equipment lease); provided,
however, that for the purposes of this definition the liability of the
Borrower or any of its Subsidiaries with respect to any obligation as
to which a third party or parties are jointly, or jointly and
severally, liable as a guarantor or otherwise as

-7-
<PAGE> 12
contemplated hereby and have not defaulted on its or their portions
thereof, shall be only its pro rata portion of such obligation.

"Increase Agreement" means an agreement entered into by the
Borrower and a Lender increasing such Lender's Commitment pursuant to
Section 2.20, and accepted by the Agent, in substantially the form of
Exhibit F-1 hereto or an agreement entered into by the Borrower and a
bank or other financial institution becoming a Lender pursuant to
Section 2.20, and accepted by the Agent, in substantially the form of
Exhibit F-2 hereto.

"Indemnified Party" means any or all of the Lenders, the
Arranger and the Agent.

"Insufficiency" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.

"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same A Borrowing, the period beginning on the
date of such Advance or the date of the Conversion of any Advance into
such Advance and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and, thereafter, each
subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of the period
selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period for a Eurodollar Rate Advance
shall be one, two, three or six months, or, subject to availability to
each Lender, nine months, in each case as the Borrower may, upon
notice received by the Agent not later than 12:00 noon (New York City
time) on the third Business Day prior to the first day of such
Interest Period, select; provided, however, that:

(i) the duration of any Interest Period which
commences before the Termination Date and would otherwise end
after the Termination Date shall end on the Termination Date;

(ii) if the last day of such Interest Period would
otherwise occur on a day which is not a Business Day, such
last day shall be extended to the next succeeding Business
Day, except if such extension would cause such last day to
occur in a

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<PAGE> 13
new calendar month, then such last day shall occur on the next
preceding Business Day;

(iii) Interest Periods commencing on the same date
for A Advances comprising the same A Borrowing shall be of
the same duration; and

(iv) any Interest Period which begins on the last
Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall, subject to clause (i)
above, end on the last Business Day of a calendar month.

"Lenders" means the Initial Lenders, each bank or other
financial institution that shall become a party hereto pursuant to
Section 2.20, each Eligible Assignee that shall become a party hereto
pursuant to Section 8.07(a), (b) and (d) and, except when used in
reference to an A Advance, an A Borrowing, an A Note, a Commitment or
a term related to any of the foregoing, each Designated Bidder.

"Lien" means any lien, security interest or other charge or
encumbrance, or any assignment of the right to receive income, or any
other type of preferential arrangement, in each case to secure any
Debt or any Guaranty of any Person.

"Long-Term Revolving Credit Agreement" means the Long-Term
Revolving Credit Agreement dated as of July 20, 1994 among the
Borrower, the financial institutions party thereto and Citibank, N.A.,
as agent for such financial institutions, as it may be amended or
otherwise modified from time to time.

"Majority Lenders" means at any time Lenders holding at least
51% of the then aggregate unpaid principal amount of the A Notes held
by Lenders, or, if no such principal amount is then outstanding,
Lenders having at least 51% of the Commitments.

"Margin Stock" means "margin stock" as defined in Regulation U
of the Board of Governors of the Federal Reserve System, as in effect
from time to time.

"Material Adverse Effect" means a material adverse effect on
the financial condition or operations of the

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<PAGE> 14
Borrower and its consolidated Subsidiaries on a consolidated basis.

"Material Plan" means any Plan the assets of which exceed
$50,000,000 or the liabilities of which for unfunded vested benefits
determined on a plan termination basis (in accordance with Title IV of
ERISA) exceed $10,000,000.

"Material Subsidiary" means, from time to time, any Subsidiary
of the Borrower then owning assets (determined on a consolidated
basis) that equal or exceed 5% of the book value of the consolidated
assets of the Borrower and its consolidated Subsidiaries at such time.

"Maturity Date" means July 15, 1995 or such later Stated
Termination Date as may be in effect pursuant to Section 2.21, or if
the Borrower has elected the Term Loan Conversion Option such later
date to which the Maturity Date has been extended pursuant to Section
2.21(g).

"Moody's" means Moody's Investors Service.

"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which the Borrower or any ERISA
Affiliate is making or accruing an obligation to make contributions,
or has within any of the preceding five plan years made or accrued an
obligation to make contributions, such plan being maintained pursuant
to one or more collective bargaining agreements.

"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, which (i) is maintained for
employees of the Borrower or an ERISA Affiliate and at least one
Person other than the Borrower and its ERISA Affiliates or (ii) was so
maintained and in respect of which the Borrower or an ERISA Affiliate
could have liability under Section 4064 or 4069 of ERISA in the event
such plan has been or were to be terminated.

"Note" means an A Note or a B Note.

"Notice of A Borrowing" has the meaning specified in Section
2.02(a).

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<PAGE> 15
"Notice of B Borrowing" has the meaning specified in Section
2.19(a).

"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).

"Permitted Assets" means (i) hydrocarbon or other reserves
(including, without limitation, proved, probable, possible or
speculative reserves), (ii) properties, assets, rights or business
related to reserves (including, without limitation, real property,
gathering systems, plants, pipelines, equipment and processing and
treatment facilities), (iii) other fixed or operating assets and (iv)
the stock of any and all companies that are or become Subsidiaries of
the Borrower owning assets referred to in any of the foregoing
clauses.

"Permitted Liens" means

(a) inchoate Liens and charges imposed by law and
incidental to construction, maintenance, development or operation of
properties, or the operation of business, in the ordinary course of
business if payment of the obligation secured thereby is not yet
overdue or if the validity or amount of which is being contested in
good faith by the Borrower or any Subsidiary of the Borrower;

(b) Liens for taxes, assessments, obligations under
workers' compensation or other social security legislation or other
governmental requirements, charges or levies, in each case not yet
overdue;

(c) Liens reserved in any oil, gas or other mineral lease
entered into in the ordinary course of business for rent, royalty or
delay rental under such lease and for compliance with the terms of
such lease;

(d) easements, servitudes, rights-of-way and other
rights, exceptions, reservations, conditions, limitations, covenants
and other restrictions which do not materially interfere with the
operation, value or use of the properties affected thereby;

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Borrower's or a Subsidiary's predecessor in title all or a portion of
the Borrower's or such Subsidiary's rights, titles and interests in
and to all or a portion of such property;

(f) any Lien reserved in a grant or conveyance in the
nature of a farm-out or conditional assignment to the Borrower or any
of its Subsidiaries entered into in the ordinary course of business on
reasonable terms to secure undertakings of the Borrower or such
Subsidiary in such grant or conveyance; and

(g) any Lien consisting of (i) statutory landlord's liens
under leases to which the Borrower or any Subsidiary of the Borrower
is a party or other Liens on leased property reserved in leases
thereof for rent or for compliance with the terms of such leases, (ii)
rights reserved to or vested in any municipality or governmental,
statutory or public authority to control or regulate any property of
the Borrower or any of its Subsidiaries or to use such property in any
manner which does not materially impair the use of such property for
the purposes for which it is held by the Borrower or any such
Subsidiary, (iii) obligations or duties to any municipality or public
authority with respect to any franchise, grant, license, lease or
permit and the rights reserved or vested in any governmental authority
or public utility to terminate any such franchise, grant, license,
lease or permit or to condemn or expropriate any property, and (iv)
zoning laws and ordinances and municipal regulations.

"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity, or a
country or any political subdivision thereof or any agency or
instrumentality of such country or subdivision.

"Plan" means a Single Employer Plan or a Multiple Employer
Plan.

"Process Agent" has the meaning specified in Section 8.09(a).

"Reference Banks" means Citibank, Morgan Guaranty Trust
Company of New York and Union Bank of Switzerland.

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<PAGE> 17
"Register" has the meaning specified in Section 8.07(c).

"S&P" means Standard and Poor's Ratings Group, a division of
McGraw-Hill, Inc. on the date hereof.

"Single Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (i) is maintained for
employees of the Borrower or an ERISA Affiliate and no Person other
than the Borrower and its ERISA Affiliates or (ii) was so maintained
and in respect of which the Borrower or an ERISA Affiliate could have
liability under Section 4069 of ERISA in the event such plan has been
or were to be terminated.

"Stated Termination Date" means July 15, 1995 or such later
date, if any, as may be in effect pursuant to Section 2.21.

"Subsidiary" means, as to any Person, any corporation of which
at least a majority of the outstanding stock having by the terms
thereof ordinary voting power to elect a majority of the board of
directors of such corporation (irrespective of whether or not at the
time stock of any other class or classes of such corporation shall or
might have voting power by reason of the happening of any contingency)
is at the time directly or indirectly beneficially owned or controlled
by such Person or one or more of its Subsidiaries or by such Person
and one or more of the Subsidiaries of such Person.

"Term Loan Conversion Option" has the meaning specified in
Section 2.21(g).

"Termination Date" means the earlier of (i) the Stated
Termination Date and (ii) the date of termination in whole of the
Commitments pursuant to Section 2.04 or 6.01.

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<PAGE> 18
or any ERISA Affiliate under Section 4064 of ERISA upon the
termination of a Multiple Employer Plan, or (iii) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan
amendment as a termination under Section 4041 of ERISA, or (iv) the
institution of proceedings to terminate a Plan by the PBGC under
Section 4042 of ERISA, or (v) the conditions set forth in Section
302(f)(1)(A) and (B) of ERISA to the creation of a lien upon property
or rights to property of the Borrower or any ERISA Affiliate for
failure to make a required payment to a Plan are satisfied, or (vi)
the adoption of an amendment to a Plan requiring the provision of
security to such Plan, pursuant to Section 307 of ERISA, or (vii) any
other event or condition which might constitute grounds under Section
4042 of ERISA for the termination of, or the appointment of a trustee
to administer, any Plan.

"Type" has the meaning specified in the definition of "A
Advance".

"Withdrawal Liability" shall have the meaning given such term
under Part I of Subtitle E of Title IV of ERISA.

SECTION 1.02. Computation of Time Periods. Unless otherwise
stated in this Agreement, in the computation of a period of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but excluding."

SECTION 1.03. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles either (i) consistent with those principles
applied in the preparation of the annual financial statements referred to in
Section 4.01(e), or (ii) not so materially inconsistent with such principles
that a covenant contained in Section 5.01 or 5.02 would be calculated or
construed in a materially different manner or with materially different results
than if such covenant were calculated or construed in accordance with clause
(i) of this Section 1.03.

ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01. The A Advances. Each Lender severally agrees,
on the terms and conditions hereinafter set forth,

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to make A Advances to the Borrower from time to time on any Business Day during
the period from the date hereof to and including the Termination Date in an
aggregate amount not to exceed at any time outstanding the amount set forth
opposite such Lender's name on the signature pages hereof under the caption
"Commitments", or, if such Lender has entered into any Assignment and
Acceptance or Increase Agreement, set forth for such Lender in the Register
maintained by the Agent pursuant to Section 8.07(c), as such amount may be
reduced pursuant to Section 2.04 (such Lender's "Commitment"), provided that
the aggregate amount of the Commitments of the Lenders shall be deemed used
from time to time to the extent of the aggregate amount of the B Advances then
outstanding and such deemed use of the aggregate amount of such Commitments
shall be applied to all the Lenders ratably according to their respective
Commitments (such deemed use of the aggregate amount of the Commitments being a
"B Reduction"). Each A Borrowing shall be in an aggregate amount of
$10,000,000 in the case of an A Borrowing comprised of Base Rate Advances and
$25,000,000 in the case of an A Borrowing comprised of Eurodollar Rate
Advances, or, in either case an integral multiple of $1,000,000 in excess
thereof (or, in the case of an A Borrowing of Base Rate Advances, the aggregate
unused Commitments, if less) and shall consist of A Advances of the same Type
made on the same day by the Lenders ratably according to their respective
Commitments. Within the limits of each Lender's Commitment, the Borrower may
make more than one Borrowing on any Business Day and may borrow, prepay
pursuant to Section 2.10, and reborrow under this Section 2.01.

SECTION 2.02. Making the A Advances.

(a) Each A Borrowing shall be made on notice by the Borrower
to the Agent (a "Notice of A Borrowing") received by the Agent, (i) in the case
of a proposed A Borrowing comprised of Base Rate Advances, not later than 10:00
A.M. (New York City time) on the Business Day of such proposed A Borrowing, and
(ii) in the case of a proposed A Borrowing comprised of Eurodollar Rate
Advances, not later than 12:00 noon (New York City time) on the third Business
Day prior to the date of such proposed A Borrowing. Each Notice of A Borrowing
shall be by telecopy, telefax or other teletransmission or by telephone (and if
by telephone, confirmed promptly by telecopier, telefax or other
teletransmission), in substantially the form of Exhibit C hereto, specifying
therein the requested (w) date of such A Borrowing, (x) Type of A Advances
comprising such A Borrowing, (y) aggregate amount of such A Borrowing, and (z)
in the case of an A Borrowing comprised of Eurodollar Rate

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Advances, the initial Interest Period for each such A Advance. Each Lender
shall, before 1:00 p.m. (New York City time) on the date of such A Borrowing,
make available for the account of its Applicable Lending Office to the Agent at
its address at Citibank, 399 Park Avenue, New York, New York 10043, Reference:
Burlington Resources Inc., or at such other location designated by notice from
the Agent to the Lenders pursuant to Section 8.02, in same day funds, such
Lender's ratable portion of such A Borrowing. Immediately after the Agent's
receipt of such funds and upon fulfillment of the applicable conditions set
forth in Article III, the Agent will make such funds available to the Borrower
at Citibank, 399 Park Avenue, New York, New York, or at any account of the
Borrower maintained by the Agent (or any successor Agent) designated by the
Borrower and agreed to by the Agent (or such successor Agent), in same day
funds.

(b) Each Notice of A Borrowing shall be irrevocable and
binding on the Borrower. In the case of any A Borrowing which the related
Notice of A Borrowing specified is to be comprised of Eurodollar Rate Advances,
if such A Advances are not made as a result of any failure to fulfill on or
before the date specified for such A Borrowing the applicable conditions set
forth in Article III, the Borrower shall indemnify each Lender against any
loss, cost or expense incurred by such Lender as a result of such failure,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the A Advance to be made by such Lender as part of such A
Borrowing.

(c) Unless the Agent shall have received notice from a
Lender prior to the date of any A Borrowing that such Lender will not make
available to the Agent such Lender's ratable portion of such A Borrowing, the
Agent may assume that such Lender has made such portion available to the Agent
on the date of such A Borrowing in accordance with subsection (a) of this
Section 2.02 and the Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If and to the
extent such Lender shall not have so made such ratable portion available to the
Agent, such Lender and the Borrower severally agree to repay to the Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid to the Agent, at the Effective Federal Funds
Rate for such day. If such Lender shall repay to the Agent such corresponding
amount, such amount so repaid shall constitute

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such Lender's A Advance to the Borrower as part of such A Borrowing for
purposes of this Agreement.

(d) The failure of any Lender to make the A Advance to be
made by it as part of any A Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its A Advance on the date of such A
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the A Advance to be made by such other Lender on the date of any
A Borrowing.

SECTION 2.03. Fees.

(a) Facility Fee. The Borrower agrees to pay to each
Lender (other than a Designated Bidder) a facility fee on the average daily
amount of such Lender's Commitment, whether or not used or deemed used, from
the date hereof in the case of each Initial Lender and from the effective date
specified in the Assignment and Acceptance or Increase Agreement pursuant to
which it became a Lender in the case of each other Lender, in each case until
the Termination Date, payable quarterly in arrears on the last day of each
March, June, September and December during the term of such Lender's Commitment
and on the Termination Date, at a rate per annum equal to the Facility Fee
Percentage.

(b) Agency Fee. The Borrower agrees to pay to the Agent,
for its own account, such agency fees as may be separately agreed to in writing
by the Borrower and the Agent, such fees to be in the amounts and payable on
the dates as may be so agreed to.

(c) Arrangement Fee. The Borrower agrees to pay to the
Agent, for its own account, an arrangement fee in the amount and payable on the
date separately agreed to in writing by the Agent and the Borrower.

SECTION 2.04. Reduction of the Commitments. The Borrower
shall have the right, upon at least three Business Days' notice to the Agent,
to terminate in whole or reduce ratably in part the unused portions of the
Commitments of the Lenders (being the amount by which such Commitments exceed
the aggregate outstanding principal amount of all Advances), provided that each
partial reduction shall be in the aggregate amount of $10,000,000 or any whole
multiple of $1,000,000 in excess thereof.

SECTION 2.05. Repayment of A Advances. The Borrower shall
repay to each Lender on the Maturity Date (or

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such earlier date as may be applicable to such Lender pursuant to Section
2.21(c)(iv)) the aggregate principal amount of the A Advances then owing to
such Lender.

SECTION 2.06. Interest on A Advances.

(a) Ordinary Interest. The Borrower shall pay interest on the
unpaid principal amount of each A Advance owing to each Lender from the date of
such A Advance until such principal amount is due (whether at stated maturity,
by acceleration or otherwise), at the following rates:

(i) Base Rate Advances. During such periods as such A
Advance is a Base Rate Advance, a rate per annum equal at all times to
the Base Rate in effect from time to time, payable quarterly in
arrears on the last day of each March, June, September and December
during such periods and on the date such Base Rate Advance shall be
Converted or due (whether at stated maturity, by acceleration or
otherwise).

(ii) Eurodollar Rate Advances. During such periods as
such A Advance is a Eurodollar Rate Advance, a rate per annum equal at
all times during each Interest Period for such A Advance to the sum of
the Eurodollar Rate for such Interest Period plus the Eurodollar Rate
Margin, payable on the last day of each such Interest Period and, if
any such Interest Period has a duration of more than three months, on
each day which occurs during such Interest Period every three months
from the first day of such Interest Period and, if such A Advance is
Converted into a Base Rate Advance on any date other than the last day
of any Interest Period for such A Advance, on the date of such
Conversion or, if later, the Business Day on which the Borrower shall
have received at least one Business Day's prior notice from the Agent
or the applicable Lender of the amount of unpaid interest accrued on
such A Advances to the date of such Conversion.

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A Advance immediately prior to the date on which such amount became due and
(ii) from and after the last day of the then existing Interest Period therefor,
in the case of each Eurodollar Rate Advance, and at all times in the case of
each Base Rate Advance or B Advance, to 1% per annum above the Base Rate in
effect from time to time.

SECTION 2.07. Additional Interest on Eurodollar Rate
Advances. If any Lender shall determine in good faith that reserves under
regulations of the Board of Governors of the Federal Reserve System are
required to be maintained by it in respect of, or a portion of its costs of
maintaining reserves under such regulations is properly attributable to, one
or more of its Eurodollar Rate Advances, the Borrower shall pay to such Lender
additional interest on the unpaid principal amount of each such Eurodollar Rate
Advance (other than any such additional interest accruing to a particular
Lender in respect of periods prior to the 30th day preceding the date notice of
such interest is given by such Lender as provided in this Section 2.07),
payable on the same day or days on which interest is payable on such A Advance,
at an interest rate per annum equal at all times during each Interest Period
for such A Advance to the excess of (i) the rate obtained by dividing the
Eurodollar Rate for such Interest Period by a percentage equal to 100% minus
the Eurodollar Reserve Percentage, if any, for such Lender for such Interest
Period over (ii) the Eurodollar Rate for such Interest Period. The amount of
such additional interest (if any) shall be determined by each Lender, and such
Lender shall furnish written notice of the amount of such additional interest
to the Borrower and the Agent, which notice shall be conclusive and binding for
all purposes, absent manifest error.

SECTION 2.08. Interest Rate Determination. (a) Each Reference
Bank agrees to furnish to the Agent timely information for the purpose of
determining each Eurodollar Rate. If any one or more of the Reference Banks
shall not furnish such timely information to the Agent for the purpose of
determining any such interest rate, the Agent shall determine such interest
rate on the basis of timely information furnished by the remaining Reference
Banks.

(b) The Agent shall give prompt notice to the Borrower
and the Lenders of the applicable interest rate determined by the Agent for
purposes of Section 2.06(a)(i) or (ii), and the applicable rate, if any,
furnished by each Reference Bank for the purpose of determining the applicable
interest rate under Section 2.06(a)(ii).

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(c) If fewer than two Reference Banks furnish timely
information to the Agent for determining the Eurodollar Rate for any applicable
A Advances,

(i) the Agent shall give the Borrower and each Lender
prompt notice by telephone (confirmed in writing) that the interest
rate cannot be determined for such applicable A Advances,

(ii) each such A Advance that is a Eurodollar Rate Advance
will automatically, on the last day of the then existing Interest
Period therefor, Convert into a Base Rate Advance (or if such A
Advance is then a Base Rate Advance, will continue as a Base Rate
Advance), and

(iii) the obligations of the Lenders to make, or to Convert
A Advances into, Eurodollar Rate Advances, as the case may be, shall
be suspended until the Agent shall notify the Borrower and the Lenders
that the circumstances causing such suspension no longer exist.

(d) If, with respect to any Eurodollar Rate Advances, the
Majority Lenders determine and give notice to the Agent that as a result of
conditions in or generally affecting the relevant market, the rates of interest
determined on the basis of the Eurodollar Rate for any Interest Period for such
A Advances will not adequately reflect the cost to such Majority Lenders of
making, funding or maintaining their respective Eurodollar Rate Advances for
such Interest Period, the Agent shall forthwith so notify the Borrower and the
Lenders, whereupon,

(i) each such Eurodollar Rate Advance will automatically,
on the last day of the then existing Interest Period therefor, Convert
into a Base Rate Advance, and

(ii) the obligation of the Lenders to make, or to Convert
A Advances into, Eurodollar Rate Advances shall be suspended until the
Agent shall notify the Borrower and the Lenders that the circumstances
causing such suspension no longer exist.

(e) If the Borrower shall fail to select the duration of
any Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01,
the Agent will forthwith so notify the Borrower and the Lenders and such
Eurodollar Rate Advances will automatically, on the last day

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of the then existing Interest Period therefor, Convert into Base Rate Advances.

(f) On the date on which the aggregate unpaid principal
amount of A Advances comprising any A Borrowing shall be reduced, by payment or
prepayment or otherwise, to less than $10,000,000, such A Advances shall, if
they are Eurodollar Rate Advances, automatically Convert into Base Rate
Advances, and on and after such date the right of the Borrower to Convert such
A Advances into Eurodollar Rate Advances shall terminate; provided, however,
that if and so long as each such A Advance shall be, or be elected to be
Converted to, Eurodollar Rate Advances having the same Interest Period as
Eurodollar Rate Advances comprising another A Borrowing or other A Borrowings,
and the aggregate unpaid principal amount of all such Eurodollar Rate Advances
shall, or upon such Conversion will, equal or exceed $20,000,000, the Borrower
shall have the right to continue all such Eurodollar Rate Advances as, or to
Convert all such A Advances into, Eurodollar Rate Advances having such Interest
Period.

SECTION 2.09. Voluntary Conversion of A Advances. The
Borrower may on any Business Day, upon notice given to the Agent, not later
than 10:00 A.M. (New York City time) on the Business Day of the proposed
Conversion of Eurodollar Rate Advances to Base Rate Advances, and not later
than 12:00 noon (New York City time) on the third Business Day prior to the
date of the proposed Conversion in the case of a Conversion of Base Rate
Advances to Eurodollar Rate Advances, and subject to the provisions of Section
2.08, 2.11 and 2.13, Convert all A Advances of one Type comprising the same A
Borrowing into A Advances of the other Type; provided, however, that any
Conversion of any Eurodollar Rate Advances into Base Rate Advances made on any
day other than the last day of an Interest Period for such Eurodollar Rate
Advances shall be subject to the provisions of Section 8.04(b). Each such
notice of a Conversion shall, within the restrictions specified above, specify
(i) the date of such Conversion, (ii) the A Advances to be Converted, and (iii)
if such Conversion is into Eurodollar Rate Advances, the duration of the
Interest Period for each such Eurodollar Rate Advance.

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if such notice is given the Borrower shall, prepay the outstanding principal
amounts of the A Advances comprising the same A Borrowing in whole or ratably
in part, together with accrued interest to the date of such prepayment on the
amount prepaid; provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount not less than $10,000,000 or an integral multiple
of $1,000,000 in excess thereof and (y) in the event of any such prepayment of
Eurodollar Rate Advances on any day other than the last day of an Interest
Period for such Eurodollar Rate Advances, the Borrower shall be obligated to
reimburse the Lenders in respect thereof pursuant to, and to the extent
required by, Section 8.04(b); provided, further, however, that the Borrower
will use its best efforts to give notice to the Agent of the proposed
prepayment of Base Rate Advances on the Business Day prior to the date of such
proposed prepayment.

SECTION 2.11. Increased Costs.

(a) If, due to either (i) the introduction after the date
of this Agreement of or any change after the date of this Agreement (including
any change by way of imposition or increase of reserve requirements or
assessments other than those referred to in the definition of "Eurodollar
Reserve Percentage" contained in Section 1.01) in or in the interpretation of
any law or regulation or (ii) the compliance with any guideline or request
issued or made after the date of this Agreement from or by any central bank or
other governmental authority (whether or not having the force of law), in each
case above other than those referred to in Section 2.12, there shall be any
increase in the cost to any Lender of agreeing to make, fund or maintain, or of
making, funding or maintaining, Eurodollar Rate Advances funded in the
interbank Eurodollar market, then the Borrower shall from time to time, upon
demand by such Lender (with a copy of such demand to the Agent), pay to the
Agent for the account of such Lender additional amounts sufficient to reimburse
such Lender for all such increased costs (except those incurred more than 60
days prior to the date of such demand; for the purposes hereof any cost or
expense allocable to a period prior to the publication or effective date of
such an introduction, change, guideline or request shall be deemed to be
incurred on the later of such publication or effective date). Each Lender
agrees to use its best reasonable efforts promptly to notify the Borrower of
any event referred to in clause (i) or (ii) above, provided that the failure to
give such notice shall not affect the rights of any Lender under this Section
2.11(a) (except as otherwise expressly provided above in this Section 2.11(a)).
A certificate as to the amount of such

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increased cost, submitted to the Borrower and the Agent by such Lender, shall
be conclusive and binding for all purposes, absent manifest error. After one
or more Lenders have notified the Borrower of any increased costs pursuant to
this Section 2.11, the Borrower may specify by notice to the Agent and the
affected Lenders that, after the date of such notice whenever the election of a
Eurodollar Rate Advance by the Borrower for an Interest Period or portion
thereof would give rise to such increased costs, such election shall not apply
to the A Advances of such Lender or Lenders during such Interest Period or
portion thereof, and, in lieu thereof, such A Advances shall during such
Interest Period or portion thereof be Base Rate Advances. Each Lender agrees
to use its best reasonable efforts (including, without limitation, a reasonable
effort to change its Applicable Lending Office or to transfer its affected A
Advances to an Affiliate of such Lender) to avoid, or minimize the amount of,
any demand for payment from the Borrower under this Section 2.11.

(b) In the event that any Lender shall change its
Eurodollar Lending Office and such change results (at the time of such change)
in increased costs to such Lender, the Borrower shall not be liable to such
Lender for such increased costs incurred by such Lender to the extent, but only
to the extent, that such increased costs shall exceed the increased costs which
such Lender would have incurred if the Eurodollar Lending Office of such Lender
had not been so changed, but, subject to subsection (a) of this Section 2.11
and to Section 2.13, nothing herein shall require any Lender to change its
Eurodollar Lending Office for any reason.

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Lender reasonably determines such increase in capital to be allocable to the
existence of such Lender's commitment to lend hereunder (except any such
increase in capital incurred more than, or compensation attributable to the
period before, 90 days prior to the date of such demand; for the purposes
hereof any increase in capital allocable to, or compensation attributable to, a
period prior to the publication or effective date of such an introduction,
change, guideline or request shall be deemed to be incurred on the later of
such publication or effective date). Each Lender agrees to use its best
reasonable efforts promptly to notify the Borrower of any event referred to in
clause (i) or (ii) above, provided that the failure to give such notice shall
not affect the rights of any Lender under this Section 2.12 (except as
otherwise expressly provided above in this Section 2.12). A certificate in
reasonable detail as to the basis for, and the amount of, such compensation
submitted to the Borrower and the Agent by such Lender shall, in the absence of
manifest error, be conclusive and binding for all purposes.

SECTION 2.13. Illegality. Notwithstanding any other
provision of this Agreement, if the introduction of or any change in or in the
interpretation of any law or regulation shall make it unlawful, or any central
bank or other governmental authority shall assert that it is unlawful, for any
Lender or its Applicable Lending Office to perform its obligations hereunder to
make Eurodollar Rate Advances or to continue to fund or maintain such Advances
hereunder, such Lender may, by notice to the Borrower and the Agent, suspend
the right of the Borrower to elect Eurodollar Rate Advances from such Lender
and, if necessary in the reasonable opinion of such Lender to comply with such
law or regulation, Convert all such Eurodollar Rate Advances of such Lender to
Base Rate Advances at the latest time permitted by the applicable law or
regulation, and such suspension and, if applicable, such Conversion shall
continue until such Lender notifies the Borrower and the Agent that the
circumstances making it unlawful for such Lender to perform such obligations no
longer exist (which such Lender shall promptly do when such circumstances no
longer exist). So long as the obligation of any Lender to make Eurodollar Rate
Advances has been suspended under this Section 2.13, all Notices of A Borrowing
specifying A Advances of such Type shall be deemed, as to such Lender, to be
requests for Base Rate Advances. Each Lender agrees to use its best reasonable
efforts (including, without limitation, a reasonable effort to change its
Applicable Lending Office or to transfer its affected A Advances to an
affiliate) to avoid any such illegality.

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SECTION 2.14. Payments and Computations.

(a) The Borrower shall make each payment hereunder
(including, without limitation, under Section 2.03, 2.05 or 2.06) and under the
Notes, whether the amount so paid is owing to any or all of the Lenders or to
the Agent, not later than 1:00 P.M. (New York City time) without setoff,
counterclaim, or any other deduction whatsoever, on the day when due in U.S.
dollars to the Agent at Citibank, 399 Park Avenue, New York, New York,
Reference: Burlington Resources Inc., or at such other location designated by
notice to the Borrower from the Agent and agreed to by the Borrower, in same
day funds. Each such payment made by the Borrower for the account of any
Lender hereunder, when so made to the Agent, shall be deemed duly made for all
purposes of this Agreement and the A Notes, except that if at any time any such
payment is rescinded or must otherwise be returned by the Agent or any Lender
upon the bankruptcy, insolvency or reorganization of the Borrower or otherwise,
such payment shall be deemed not to have been so made. The Agent will promptly
thereafter cause to be distributed like funds relating to the payment of
principal or interest or fees ratably (other than amounts payable pursuant to
Section 2.07, 2.11, 2.12, 2.13, 2.15, 2.19, 2.21(c)(iv) or 8.04(b)) to the
Lenders for the account of their respective Applicable Lending Offices, and
like funds relating to the payment of any other amount payable to any Lender to
such Lender for the account of its Applicable Lending Office, in each case to
be applied in accordance with the terms of this Agreement. Upon its acceptance
of an Assignment and Acceptance and recording of the information contained
therein in the Register pursuant to Section 8.07(d), from and after the
effective date specified in such Assignment and Acceptance, the Agent shall
make all payments hereunder and under the A Notes in respect of the interest
assigned thereby to the Lender assignee thereunder, and the parties to such
Assignment and Acceptance shall make all appropriate adjustments in such
payments for periods prior to such effective date directly between themselves.

(b) All computations of interest based on the Base Rate
and of facility fees shall be made by the Agent on the basis of a year of 365
or 366 days, as the case may be, and all computations of interest based on the
Eurodollar Rate, or the Effective Federal Funds Rate shall be made by the
Agent, and all computations of interest pursuant to Section 2.07 shall be made
by each Lender with respect to its own Eurodollar Rate Advances, on the basis
of a year of 360 days, in each case for the actual number of days (including
the first day but excluding the last day) occurring in the period

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for which such interest or fees are payable. Each determination by the Agent
(or, in the case of Section 2.07, 2.11, 2.12, 2.13, 2.15, 2.19 or 8.04(b), by
each Lender with respect to its own Advances) of an interest rate or an
increased cost, loss or expense or increased capital or of illegality or taxes
hereunder shall be conclusive and binding for all purposes if made reasonably
and in good faith.

(c) Whenever any payment hereunder or under the Notes
shall be stated to be due on a day other than a Business Day, such payment
shall be made on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of payment of interest or
facility fees, as the case may be; provided, however, if such extension would
cause payment of interest on or principal of Eurodollar Rate Advances to be
made in the next following calendar month, such payment shall be made on the
next preceding Business Day.

(d) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Lenders hereunder
that the Borrower will not make such payment in full, the Agent may assume that
the Borrower has made such payment in full to the Agent on such date and the
Agent may, in reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due such Lender. If
and to the extent the Borrower shall not have so made such payment in full to
the Agent, each Lender shall repay to the Agent forthwith on demand such amount
distributed to such Lender together with interest thereon, for each day from
the date such amount is distributed to such Lender until the date such Lender
repays such amount to the Agent, at a rate equal to the Effective Federal Funds
Rate for such day.

SECTION 2.15. Taxes.

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<PAGE> 31
thereto, imposed on it by reason of the jurisdiction in which such Indemnified
Party is organized, domiciled, resident or doing business, or any political
subdivision thereof, or by reason of the jurisdiction of its Applicable Lending
Office or any other office from which it makes or maintains any extension of
credit hereunder or any political subdivision thereof (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings and liabilities in
respect of payments under this Agreement or under the Notes being herein
referred to as "Taxes"). If the Borrower shall be required by law to deduct
any Taxes from or in respect of any sum payable hereunder or under any Note to
any Indemnified Party, (i) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 2.15) such Indemnified
Party receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower (or the Agent, as applicable) shall
make such deductions at the applicable statutory rate and (iii) the Borrower
(or the Agent, as applicable) shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable
law, provided that the Borrower shall not be required to pay any additional
amount (and shall be relieved of any liability with respect thereto) pursuant
to this subsection (a) (or pursuant to Section 2.15(c), except to the extent
Section 2.15(c) relates to Other Taxes) to any Indemnified Party that either
(x) on the date such Indemnified Party executed this Agreement or otherwise
became an "Indemnified Party" hereunder, either (A) was not entitled to submit
a U.S. Internal Revenue Service form 1001 (relating to such Indemnified Party,
and entitling it to a complete exemption from withholding on all amounts to be
received by such Indemnified Party, including fees, pursuant to this Agreement
or the Advances) or a U.S. Internal Revenue Service form 4224 (relating to all
amounts to be received by such Indemnified Party, including fees, pursuant to
this Agreement and the Advances) or (B) is not a United States person (as such
term is defined in Section 7701(a)(30) of the Internal Revenue Code), or (y)
has failed to submit any form or certificate that it was required to file or
provide pursuant to subsection (d) of this Section 2.15 and is entitled to
file or give, as applicable, under applicable law, provided, further, that
should an Indemnified Party become subject to Taxes because of its failure to
deliver a form required hereunder, the Borrower shall take such administrative
steps as such Indemnified Party shall reasonably request to assist such
Indemnified Party to recover such Taxes, and provided further, that each
Indemnified Party, with respect to itself,

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agrees to indemnify and hold harmless the Borrower from any taxes, penalties,
interest and other expenses, costs and losses incurred or payable by the
Borrower as a result of the failure of the Borrower to comply with its
obligations under clauses (ii) or (iii) above in reliance on any form or
certificate provided to it by such Indemnified Party pursuant to this Section
2.15. If any Indemnified Party receives a net credit or refund in respect of
such Taxes or amounts so paid by the Borrower, it shall promptly notify the
Borrower of such net credit or refund and shall promptly pay such net credit or
refund to the Borrower, provided that the Borrower agrees to return such net
credit or refund if the Indemnified Party to which such net credit or refund is
applicable, is required to repay it.

(b) In addition, the Borrower agrees to pay any present
or future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or under
the Notes or from the execution, delivery or registration of, or otherwise with
respect to, this Agreement or the Notes (hereinafter referred to as "Other
Taxes").

(c) The Borrower will indemnify each Indemnified Party
for the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 2.15) paid by such Indemnified Party and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto
except as a result of the gross negligence (which shall in any event include
the failure of such Indemnified Party to provide to the Borrower any form or
certificate that it was required to provide pursuant to subsection (d) below)
or willful misconduct of such Indemnified Party, whether or not such Taxes or
Other Taxes were correctly or legally asserted. This indemnification shall be
made within 30 days from the date such Indemnified Party makes written demand
therefor.

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<PAGE> 33
Party hereunder, or other documents satisfactory to the Borrower indicating
that all payments to be made to such Indemnified Party hereunder are fully
exempt from such taxes. Thereafter and from time to time, each such
Indemnified Party shall submit to the Borrower and the Agent such additional
duly completed and signed copies of one or the other of such forms (or such
successor forms as shall be adopted from time to time by the relevant United
States taxing authorities) as may be (i) notified by the Borrower to such
Indemnified Party and (ii) required under then-current United States law or
regulations to avoid United States withholding taxes on payments in respect of
all amounts to be received by such Indemnified Party pursuant to this Agreement
or the Notes, including without limitation fees. Upon the request of the
Borrower from time to time, each Indemnified Party that is a United States
person (as such term is defined in Section 7701(a)(30) of the Internal Revenue
Code) shall submit to the Borrower a certificate to the effect that it is such
a United States person. If any Indemnified Party determines, as a result of
any change in applicable law, regulation or treaty, or in any official
application or interpretation thereof, that it is unable to submit to the
Borrower any form or certificate that such Indemnified Party is obligated to
submit pursuant to this subsection (d), or that such Indemnified Party is
required to withdraw or cancel any such form or certificate previously
submitted, such Indemnified Party shall promptly notify the Borrower and the
Agent of such fact.

(e) Any Indemnified Party claiming any additional amounts
payable pursuant to this Section 2.15 shall use its best reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
change the jurisdiction of its Applicable Lending Office if the making of such
a change would avoid the need for, or reduce the amount of, any such additional
amounts which may thereafter accrue and would not, in the reasonable judgment
of such Indemnified Party, be otherwise disadvantageous to such Indemnified
Party.

(f) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and obligations of the
Borrower and each Indemnified Party contained in this Section 2.15 shall
survive the payment in full of principal and interest hereunder and under the
Notes.

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<PAGE> 34
pursuant to Section 2.07, 2.11, 2.12, 2.13, 2.15, 2.21(c)(iv) or 8.04(b)) in
excess of its ratable share of payments on account of the A Advances obtained
by all the Lenders, such Lender shall forthwith purchase from the other Lenders
such participations in the A Advances made by them as shall be necessary to
cause such purchasing Lender to share the excess payment ratably with each of
them, provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each
Lender shall be rescinded and each Lender shall repay to the purchasing Lender
the purchase price to the extent of such Lender's ratable share (according to
the proportion of (i) the amount of the participation purchased from such
Lender as a result of such excess payment to (ii) the total amount of such
excess payment) of such recovery together with an amount equal to such Lender's
ratable share (according to the proportion of (i) the amount of such Lender's
required repayment to (ii) the total amount so recovered from the purchasing
Lender) of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered. The Borrower agrees that
any Lender so purchasing a participation from another Lender pursuant to this
Section may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation.

SECTION 2.17. Evidence of Debt. The indebtedness of the
Borrower to each Lender in respect of principal of and interest on the A
Advances shall be evidenced by an A Note payable to the order of such Lender
and delivered hereunder by the Borrower. Notwithstanding the provisions of the
A Notes for notations to be made on the grid attached thereto, any Lender may
maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower resulting from A Advances and
payments made from time to time hereunder and under the A Note payable to its
order. In any legal action or proceeding in respect of this Agreement or such
A Note, the entries made in such account or accounts shall be conclusive
evidence of the existence and amounts of the obligations of the Borrower
therein recorded, absent manifest error.

SECTION 2.18. Use of Proceeds. Proceeds of the Advances may
be used for general corporate purposes of the Borrower and its Subsidiaries,
including, without limitation, for acquisitions and for payment of commercial
paper issued by the Borrower.

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SECTION 2.19. The B Advances. (a) Each Lender
severally agrees that the Borrower may make B Borrowings under this Section
2.19 from time to time on any Business Day during the period from the date
hereof until the earlier of (I) the Termination Date or (II) the date occurring
30 days prior to the Stated Termination Date in the manner set forth below;
provided that (x) each B Borrowing shall be in an aggregate amount of
$25,000,000 or an integral multiple of $5,000,000 in excess thereof and (y)
following the making of each B Borrowing, the aggregate number of outstanding B
Borrowings shall not exceed seven and the aggregate amount of all Advances then
outstanding shall not exceed the aggregate amount of the Commitments of the
Lenders (computed without regard to any B Reduction).

(i) The Borrower may request a B Borrowing under this
Section 2.19 by delivering to the Agent, by telecopy, telefax or other
teletransmission, a notice of a B Borrowing (a "Notice of B
Borrowing"), in substantially the form of Exhibit D hereto, specifying
the date and aggregate amount of the proposed B Borrowing, the
maturity date for repayment of each B Advance to be made as part of
such B Borrowing (which maturity date may not be earlier than the date
occurring 30 days after the date of such B Borrowing or later than the
earlier of (x) 180 days after the date of such B Borrowing or (y) the
Stated Termination Date), the interest payment date or dates relating
thereto, and any other terms to be applicable to such B Borrowing, not
later than 10:00 A.M. (New York City time) (A) at least one Business
Day prior to the date of the proposed B Borrowing, if the Borrower
shall specify in the Notice of B Borrowing that the rates of interest
to be offered by the Lenders shall be fixed rates per annum and (B) at
least four Business Days prior to the date of the proposed B
Borrowing, if the Borrower shall instead specify in the Notice of B
Borrowing the basis to be used by the Lenders in determining the rates
of interest to be offered by them. The Agent shall in turn promptly
notify each Lender of each request for a B Borrowing received by it
from the Borrower by sending such Lender a copy of the related Notice
of B Borrowing.

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<PAGE> 36
thereof to the Borrower), before 10:00 A.M. (New York City time) (x)
on the date of such proposed B Borrowing in the case of a Notice of B
Borrowing delivered pursuant to clause (A) of paragraph (i) above, and
(y) three Business Days before the date of such proposed B Borrowing
in the case of a Notice of B Borrowing delivered pursuant to clause
(B) of paragraph (i) above, of the minimum amount and maximum amount
of each B Advance which such Lender would be willing to make as part
of such proposed B Borrowing (which amounts may, subject to clause (y)
of the proviso to the first sentence of this Section 2.19(a), exceed
such Lender's Commitment), the rate or rates of interest therefor and
such Lender's Applicable Lending Office with respect to such B
Advance; provided that if the Agent in its capacity as a Lender shall,
in its sole discretion, elect to make any such offer, it shall notify
the Borrower of such offer before 9:45 A.M. (New York City time) on
the date on which notice of such election is to be given to the Agent
by the other Lenders. If any Lender shall elect not to make such an
offer, such Lender shall so notify the Agent, before 10:00 A.M. (New
York City time) on the date on which notice of such election is to be
given to the Agent by the other Lenders, and such Lender shall not be
obligated to, and shall not, make any B Advance as part of such B
Borrowing; provided that the failure by any Lender to give such notice
shall not cause such Lender to be obligated to make any B Advance as
part of such proposed B Borrowing.

(iii) The Borrower shall, in turn, before 11:00 A.M. (New
York City time) (x) on the date of such proposed B Borrowing, in the
case of a Notice of B Borrowing delivered pursuant to clause (A) of
paragraph (i) above and (y) three Business Days before the date of
such proposed B Borrowing in the case of a Notice of B Borrowing
delivered pursuant to clause (B) of paragraph (i) above, either

A. cancel such B Borrowing by giving the Agent
notice to that effect, or

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<PAGE> 37
Lenders as part of such B Borrowing shall be allocated
among such Lenders pro rata on the basis of the maximum
amount offered by such Lenders at such rates or margin in
connection with such B Borrowing), in any aggregate amount
up to the aggregate amount initially requested by the
Borrower in the relevant Notice of B Borrowing, by giving
notice to the Agent of the amount of each B Advance (which
amount shall be equal to or greater than the minimum
amount, and equal to or less than the maximum amount,
notified to the Borrower by the Agent on behalf of such
Lender for such B Advance pursuant to paragraph (ii) above)
to be made by each Lender as part of such B Borrowing, and
reject any remaining offers made by Lenders pursuant to
paragraph (ii) above by giving the Agent notice to that
effect.

(iv) If the Borrower notifies the Agent that such B
Borrowing is cancelled pursuant to paragraph (iii)(A) above, the Agent
shall give prompt notice thereof to the Lenders and such B Borrowing
shall not be made.

(v) If the Borrower accepts one or more of the offers
made by any Lender or Lenders pursuant to paragraph (iii)(B) above,
the Agent shall in turn promptly notify (A) each Lender that has made
an offer as described in paragraph (ii) above, of the date and
aggregate amount of such B Borrowing and whether or not any offer or
offers made by such Lender pursuant to paragraph (ii) above have been
accepted by the Borrower, (B) each Lender that is to make a B Advance
as part of such B Borrowing, of the amount of each B Advance to be
made by such Lender as part of such B Borrowing, and (C) each Lender
that is to make a B Advance as part of such B Borrowing, upon receipt,
that the Agent has received forms of documents appearing to fulfill
the applicable conditions set forth in Article III. Each Lender that
is to make a B Advance as part of such B Borrowing shall, before 12:00
noon (New York City time) on the date of such B Borrowing specified in
the notice received from the Agent pursuant to clause (A) of the
preceding sentence or any later time when such Lender shall have
received notice from the Agent pursuant to clause (C) of the preceding
sentence, make available for the account of its Applicable Lending
Office to the Agent at its address referred to in Section 8.02 such
Lender's portion of such B Borrowing, in same day funds. Upon
fulfillment of the applicable conditions set forth in

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Article III and after receipt by the Agent of such funds, the Agent
will make such funds available to the Borrower at the Agent's
aforesaid address. Promptly after each B Borrowing the Agent will
notify each Lender of the amount of the B Borrowing, the consequent B
Reduction and the dates upon which such B Reduction commenced and will
terminate.

(b) Within the limits and on the conditions set forth in
this Section 2.19, the Borrower may from time to time borrow under this Section
2.19, repay or prepay pursuant to subsection (c) below, and reborrow under this
Section 2.19.

(c) The Borrower shall repay to the Agent for the account
of each Lender which has made a B Advance, or each other holder of a B Note, on
the maturity date of each B Advance (such maturity date being that specified by
the Borrower for repayment in the related Notice of B Borrowing and provided in
the B Note evidencing such B Advance), the then unpaid principal amount of such
B Advance. The Borrower shall have no right to prepay any B Advance unless,
and then only on the terms, specified by the Borrower for such B Advance in the
related Notice of B Borrowing delivered pursuant to Section 2.19(a)(i) and set
forth in the B Note evidencing such B Advance or unless the holder of such B
Advance otherwise consents in writing to such prepayment.

(d) The Borrower shall pay interest on the unpaid
principal amount of each B Advance from the date of such B Advance to the date
the principal amount of such B Advance is repaid in full at the rate of
interest for such B Advance specified by the Lender making such B Advance in
its notice delivered pursuant to subsection (a)(ii) above on the interest date
or dates specified by the Borrower for such B Advance in the related Notice of
B Borrowing and set forth in the B Note evidencing such B Advance, subject to
Section 2.06(b).

(e) The indebtedness of the Borrower in respect of
principal of and interest on each B Advance made to the Borrower as part of a B
Borrowing shall be evidenced by a separate B Note of the Borrower payable to
the order of the Lender making such B Advance.

(f) Each time that the Borrower gives a Notice of B
Borrowing, the Borrower shall pay to the Agent for its own account such fee as
may be agreed between the Borrower and the Agent from time to time, whether or
not any B Borrowing is in fact made.

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(g) Following the making of each B Borrowing, the
Borrower agrees that it will be in compliance with the limitations set forth in
clause (y) of the proviso to the first sentence of Section 2.19(a).

(h) The failure of any Lender to make the B Advance to be
made by it as part of any B Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its B Advance on the date of such B
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the B Advance to be made by such other Lender on the date of any
B Borrowing. If any Designated Bidder fails to make the B Advance to be made
by it as part of any B Borrowing, such Designated Bidder shall not thereafter
have the right to offer to make any B Advance without the prior written consent
of the Borrower and the Agent.

SECTION 2.20. Increase of Commitments. The Borrower shall
have the right, without the consent of the Lenders or the Agent (except as
contemplated in clauses (d) and (e) of this sentence), to effectuate from time
to time, on any Business Day (but not on more than one Business Day in any
calendar quarter) an increase in the total Commitments under this Agreement (an
"Increase") by adding to this Agreement one or more banks or other financial
institutions (who shall, upon completion of the requirements stated in this
Section 2.20, constitute Lenders hereunder), or by allowing one or more Lenders
to increase their Commitments hereunder, or both, provided that (a) no Increase
in Commitments pursuant to this Section 2.20 shall result in the total
Commitments exceeding $400,000,000 or shall result in the aggregate amount of
the Increases in the Commitments effectuated pursuant to this Section 2.20
since the date of this Agreement exceeding $100,000,000, (b) any Increase in
Commitments pursuant to this Section 2.20 shall be in the amount of $10,000,000
or an integral multiple of $1,000,000 in excess thereof, (c) on the effective
date of each Increase in the Commitments pursuant to this Section 2.20, (i) the
Borrower shall have outstanding public long-term senior unsecured debt
securities that are rated by S&P or Moody's, (ii) either (1) the lowest such
rating by Moody's shall be A3 or better or (2) the lowest such rating by S&P
shall be A- or better, and (iii) no event shall have occurred and be continuing
which constitutes an Event of Default or would constitute an Event of Default
but for the requirement that notice be given or time elapse or both, (d) no
Lender's Commitment amount shall be increased without the consent of such
Lender, (e) each new bank or other financial institution, if any, both is
acceptable to the Agent and provides a Commitment of at least $10,000,000, (f)
simul-

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taneously with each increase in the Commitment of any Lender pursuant to this
Section 2.20, the Borrower will cause such Lender's "Commitment" (under and as
defined in the Long-Term Revolving Credit Agreement) to be increased pursuant
to Section 2.20 thereof by the same percentage as such Lender's Commitment is
being increased pursuant to this Section 2.20, unless the Long-Term Revolving
Credit Agreement has been terminated, (g) simultaneously with the addition of
any bank or financial institution pursuant to this Section 2.20, the Borrower
will cause such bank or financial institution to become a party to the
Long-Term Revolving Credit Agreement pursuant to Section 2.20 thereof with a
"Commitment" (under and as defined in the Long-Term Revolving Credit Agreement)
that constitutes the same percentage of all "Commitments" thereunder as the
percentage that its Commitment hereunder constitutes of all Commitments
hereunder, unless the Long-Term Revolving Credit Agreement has been terminated,
and (h) immediately prior to, or simultaneously with, any Increase pursuant to
this Section 2.20, the Borrower will prepay in accordance with the terms of
this Agreement, all outstanding A Advances, if any (including, without
limitation, prepayment from the proceeds of any A Borrowing from the Lenders
made on the date of such Increase in accordance with this Agreement and in
accordance with their respective Commitments after giving effect to such
Increase). The Borrower shall give the Agent ten Business Days' notice of the
Borrower's intention to effect any Increase in the total Commitments pursuant
to this Section 2.20. Such notice shall specify each new bank or other
financial institution, if any, the changes in amounts of Commitments that will
result, if any, and such other information as is reasonably requested by the
Agent. Each new bank or other financial institution, and each Lender agreeing
to increase its Commitment, shall execute and deliver to the Agent an Increase
Agreement, substantially in the form of Exhibit F-1 hereto or Exhibit F-2
hereto, as the case may be, pursuant to which it becomes a party hereto or
increases its Commitment, as the case may be. In addition, the Borrower shall
execute and deliver an A Note in the principal amount of the Commitment of each
new bank or other financial institution, or a replacement A Note in the
principal amount of the increased Commitment of each Lender agreeing to
increase its Commitment, as the case may be. Such A Notes and other documents
of the nature referred to in Section 3.01 shall be furnished to the Agent in
form and substance as may be reasonably required by it. Upon execution and
delivery of such documents, such new bank or other financial institution shall
constitute a "Lender" hereunder with a Commitment as specified therein, or such
Lender's Commitment shall increase as specified therein, as the case may be.
Before effecting

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any Increase by addition of any new bank or other financial institution, the
Borrower will first offer the Lenders, by notice to them, the right to
participate in such Increase by increasing their respective Commitments, and
each Lender electing to participate in such Increase shall have the right to
participate in such Increase (by increasing its Commitment in accordance with,
and subject to, this Section 2.20) on a ratable basis.

SECTION 2.21. Renewal of Commitments.

(a) So long as no Event of Default shall have occurred and be
continuing, the Borrower may request by notice to the Agent and each Lender,
given no earlier than 60 days prior to, and no later than 40 days prior to, any
Stated Termination Date ("Existing Termination Date"), that the Lenders renew
their respective Commitments for an additional 364 days. If a Lender agrees,
in its sole and absolute discretion, to so renew its Commitment, it will give
notice to the Agent of its decision to do so no earlier than 30 days prior to,
and no later than 20 days prior to, such Existing Termination Date. No later
than 19 days prior to such Existing Termination Date (or the next Business Day,
if the day 19 days prior to such Existing Termination Date is not a Business
Day), the Agent will notify the Borrower and the Lenders of the Lenders from
which it has received such a notice agreeing to so renew ("Renewing Lenders").
Any failure by a Lender to so notify the Agent shall be deemed to be a decision
by such Lender to not so renew its Commitment.

(b) If all Lenders elect to so renew their respective Commitments,
the Stated Termination Date shall automatically become the date that is 364
days following the Existing Termination Date unless the Borrower shall elect
the Term Loan Conversion Option.

(c) If, at the time the Agent gives the notice contemplated by
Section 2.21(a) to the Borrower and the Lenders, the Commitments of the
Renewing Lenders aggregate at least 51% of, but less than 100% of, the
Commitments of all of the Lenders at such time ("Existing Commitments"), unless
the Borrower shall elect the Term Loan Conversion Option, (i) effective as of
the Existing Termination Date, the Stated Termination Date shall automatically
become the date that is 364 days following the Existing Termination Date as to
each Renewing Lender, (ii) the Stated Termination Date shall remain unchanged
as to each Lender that is not a Renewing Lender (each a "Terminating Bank"),
(iii) each Terminating Bank's Commitment shall terminate on the Existing
Termination Date,

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and (iv) the Borrower shall pay on the Existing Termination Date the
outstanding Advances owed to each Terminating Bank and all other amounts owed
to each Terminating Bank.

(d) If, at the time the Agent gives the notice contemplated by
Section 2.21(a) to the Borrower and the Lenders, the Commitments of the
Renewing Lenders aggregate less than 100% of the Existing Commitments, then the
Borrower may (i) request one or more Renewing Lenders to increase their
respective Commitments pursuant to Section 2.20 (but no Lender shall be
obligated to do so), and (ii) if the Borrower is unable to obtain the agreement
of Renewing Lenders to so increase their respective Commitments in an amount
that is sufficient to cause the Commitments of the Renewing Lenders (after
giving effect to such increase) to aggregate 100% or more of the Existing
Commitments, attempt to add one or more banks or other financial institutions
to this Agreement pursuant to Section 2.20.

(e) If on the Existing Termination Date, after giving effect to
any such increase or addition pursuant to Section 2.21(d), the Commitments of
the Renewing Lenders and such additional banks or other financial institutions
aggregate less than 51% of the Existing Commitments, none of the Commitments
(including, without limitation, the Commitment of any Renewing Lender) will be
extended and the Stated Termination Date shall remain unchanged, without
prejudice to the Borrower's right to elect the Term Loan Conversion Option.

(f) The Borrower may repeat the process contemplated by this
Section 2.21 once each year (commencing in 1995) so long as the Term Loan
Conversion Option has not been exercised, but the election by any Lender to
become a Renewing Lender at any time shall not obligate such Lender to become a
Renewing Lender at any other time, it being agreed that each election of any
Lender to renew or not renew shall be made by such Lender in its sole and
absolute discretion and that such discretion shall not be limited by any prior
election to become a Renewing Lender.

(g) The Borrower shall have the option ("Term Loan Conversion
Option") to elect both (i) to have the Stated Termination Date remain unchanged
(whether or not sufficient Lenders have elected to renew their respective
Commitments), and (ii) to have the Maturity Date extended by one year, which
option, if exercised, shall be exercised only by notice to the Agent at least
one Business Day before such Stated Termination Date. If the Term Loan
Conversion Option has been elected prior to any Stated Termination Date, such
Stated Termination

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Date shall remain unchanged, the Borrower shall not borrow hereunder after the
Stated Termination Date, and the Maturity Date shall be extended to the date
that is one year following such Stated Termination Date.

ARTICLE III
CONDITIONS OF EFFECTIVENESS AND LENDING

SECTION 3.01. Conditions Precedent to Effectiveness of this
Agreement. This Agreement shall become effective when (i) it shall have been
executed by the Borrower and the Agent, (ii) the Agent and the Borrower either
shall have been notified by each Initial Lender that such Initial Lender has
executed it or shall have received a counterpart of this Agreement executed by
such Initial Lender, and (iii) the Agent shall, on or before August 15, 1994,
have received the following, each dated the date of delivery thereof unless
otherwise specified below (which date shall be selected by the Borrower and be
the same for all documents and all Lenders), in form and substance satisfactory
to the Agent and (except for the Notes) in sufficient copies for each Lender:

(a) The A Notes, to the order of the Lenders,
respectively.

(b) Certified copies of the resolutions of the Board of
Directors of the Borrower approving the borrowings contemplated hereby
and authorizing the execution of this Agreement and the Notes, and of
all documents evidencing other necessary corporate action and
governmental approvals, if any, with respect to this Agreement and the
Notes.

(c) A certificate of the Secretary or an Assistant
Secretary of the Borrower (i) certifying names and true signatures of
officers of the Borrower authorized to sign this Agreement and the
Notes and the other documents to be delivered hereunder and (ii) if
the date of effectiveness of this Agreement is other than the date
hereof, certifying that the representations and warranties contained
in Section 4.01 are true and correct as of such date of effectiveness.

(d) A favorable opinion of the Borrower's Senior Vice
President, Law or its Vice President, Law, in substantially the form
of Exhibit G hereto.

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(e) A favorable opinion of Fried, Frank, Harris, Shriver
& Jacobson, New York counsel to the Borrower, in substantially the
form of Exhibit H hereto.

(f) A favorable opinion of Bracewell & Patterson, L.L.P.,
counsel for the Agent, in substantially the form of Exhibit I hereto.

(g) A letter from the Process Agent, in substantially the
form of Exhibit J hereto, agreeing to act as Process Agent and to
forward forthwith all process received by it to the Borrower.

(h) A letter addressed to the Agent from the Borrower
with respect to the Revolving Credit Agreement dated as of April 21,
1992 (the "1992 Agreement"), among the Borrower, the financial
institutions party thereto as "Lenders" thereunder, and Citibank as
agent for such "Lenders", stating to the effect that (i) all the
"Commitments" (as defined in and under the 1992 Agreement) of the
"Lenders" under the 1992 Agreement have been terminated, (ii) no
advances are outstanding under the 1992 Agreement, and (iii) all fees
and other amounts payable under the 1992 Agreement have been paid in
full.

Anything in this Agreement to the contrary notwithstanding, if all of the
conditions to effectiveness of this Agreement specified in this Section 3.01
shall not have been fulfilled on or before August 15, 1994, this Agreement, and
all of the obligations of the Borrower, the Lenders and the Agent hereunder,
shall be terminated on and as of 5:00 P.M. (New York City time) on August 15,
1994; provided, however, that as soon as the Agent determines that all of the
conditions to effectiveness of this Agreement specified in this Section 3.01
shall have been fulfilled on or before August 15, 1994, the Agent shall furnish
written notice to the Borrower and the Initial Lenders to the effect that it
has so determined, and such notice by the Agent shall constitute conclusive
evidence that this Agreement shall have become effective for all purposes.

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application of the proceeds therefrom, the following statements shall be true
and correct, and the giving by the Borrower of the applicable Notice of A
Borrowing and the acceptance by the Borrower of the proceeds of such A
Borrowing shall constitute its representation and warranty that on and as of
the date of such A Borrowing, before and immediately after giving effect
thereto and to the application of the proceeds therefrom, the following
statements are true and correct:

(a) Each representation and warranty contained in Section
4.01 is correct in all material respects as though made on and as of
such date;

(b) No event has occurred and is continuing, or would
result from such A Borrowing, which constitutes an Event of Default or
would constitute an Event of Default but for the requirement that
notice be given or time elapse or both; and

(c) The aggregate amount of the borrowings under this
Agreement (including, without limitation, such A Borrowing) and under
other agreements or facilities or evidenced by other instruments or
documents is not in excess of the aggregate amount of such borrowings
approved as of such date by the Board of Directors of the Borrower.

SECTION 3.03. Conditions Precedent to Each B Borrowing. The
obligation of each Lender which is to make a B Advance on the occasion of any B
Borrowing (including the initial B Borrowing) shall be subject to the further
conditions precedent that (i) at or before the time required by paragraph (iii)
of Section 2.19(a), the Agent shall have received the written confirmatory
notice of such B Borrowing contemplated by such paragraph, (ii) on or before
the date of such B Borrowing, but prior to such B Borrowing, the Agent shall
have received a B Note executed by the Borrower payable to the order of such
Lender for each of the one or more B Advances to be made by such Lender as part
of such B Borrowing, in a principal amount equal to the principal amount of the
B Advance to be evidenced thereby and otherwise on such terms as were agreed to
for such B Advance in accordance with Section 2.19, (iii) on or before the date
of such B Borrowing this Agreement shall have become effective pursuant to
Section 3.01, and (iv) on the date of such B Borrowing, before and immediately
after giving effect to such B Borrowing and to the application of the proceeds
therefrom, the following statements shall be true and correct, and the giving
by the

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<PAGE> 46
Borrower of the applicable Notice of B Borrowing and the acceptance by the
Borrower of the proceeds of such B Borrowing shall constitute its
representation and warranty that on and as of the date of such B Borrowing,
before and immediately after giving effect thereto and to the application of
the proceeds therefrom, the following statements are true and correct:

(a) Each representation and warranty contained in Section
4.01 is correct in all material respects as though made on and as of
such date;

(b) No event has occurred and is continuing, or would
result from such B Borrowing, which constitutes an Event of Default or
would constitute an Event of Default but for the requirement that
notice be given or time elapse or both; and

(c) The aggregate amount of the borrowings under this
Agreement (including, without limitation, such B Borrowing) and under
other agreements or facilities or evidenced by other instruments or
documents is not in excess of the aggregate amount of such borrowings
approved as of such date by the Board of Directors of the Borrower.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

SECTION 4.01. Representations and Warranties of the
Borrower. The Borrower represents and warrants as follows:

(a) The Borrower is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of
Delaware. Each Material Subsidiary is duly incorporated, validly
existing and in good standing in the jurisdiction of its
incorporation. The Borrower and each Material Subsidiary possess all
corporate powers and all other authorizations and licenses necessary
to engage in its business and operations as now conducted, the failure
to obtain or maintain which would have a Material Adverse Effect.
Each Subsidiary which is, on and as of the date of this Agreement, a
Material Subsidiary is listed on Schedule II hereto.

(b) The execution, delivery and performance by the
Borrower of this Agreement and the Notes are within the Borrower's
corporate powers, have been duly authorized by

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all necessary corporate action, and do not contravene (i) the
Borrower's certificate of incorporation or by-laws or (ii) law or any
contractual restriction binding on or affecting the Borrower.

(c) No authorization or approval or other action by, and
no notice to or filing with, any governmental authority or regulatory
body is required for the due execution, delivery and performance by
the Borrower of this Agreement or the Notes which has not been duly
made or obtained, except those (i) required in the ordinary course to
comply with ongoing covenant obligations of the Borrower hereunder the
performance of which is not yet due and (ii) that will, in the
ordinary course of business in accordance with this Agreement, be duly
made or obtained on or prior to the time or times the performance of
such obligations shall be due.

(d) This Agreement constitutes, and the Notes when
delivered hereunder shall constitute, legal, valid and binding
obligations of the Borrower enforceable against the Borrower in
accordance with their respective terms, except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors rights generally or by general
principles of equity.

(e) The consolidated balance sheet of the Borrower and
its consolidated Subsidiaries as at December 31, 1993 and the related
consolidated statements of income and cash flow for the fiscal year
then ended, reported on by Coopers & Lybrand, independent public
accountants, copies of which have been furnished to the Agent and the
Initial Lenders prior to the date hereof, fairly present the
consolidated financial condition of the Borrower and such Subsidiaries
as at such date and the consolidated results of their operations for
such fiscal period, all in accordance with generally accepted
accounting principles consistently applied. The consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at March
31, 1994 and the related consolidated statements of income and cash
flow for the three months then ended, copies of which have been
furnished to the Agent and the Initial Lenders prior to the date
hereof, fairly present the consolidated financial condition of the
Borrower and such Subsidiaries as at such date and the consolidated
results of their operations for such fiscal period, all in accordance
with generally accepted accounting principles consistently applied,
and since March 31, 1994

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<PAGE> 48
there has been no material adverse change in such condition or
operations.

(f) There is no action, suit or proceeding pending, or to
the knowledge of the Borrower threatened, against or involving the
Borrower or any Material Subsidiary in any court, or before any
arbitrator of any kind, or before or by any governmental body, which
in the reasonable judgment of the Borrower (taking into account the
exhaustion of all appeals) would have a material adverse effect on the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries taken as a whole, or which purports to affect the
legality, validity, binding effect or enforceability of this Agreement
or the Notes.

(g) The Borrower and each consolidated Subsidiary have
duly filed all tax returns required to be filed, and duly paid and
discharged all taxes, assessments and governmental charges upon it or
against its properties now due and payable, the failure to file or pay
which, as applicable, would have a Material Adverse Effect, unless and
to the extent only that the same are being contested in good faith and
by appropriate proceedings by the Borrower or the appropriate
Subsidiary.

(h) The Borrower and each Material Subsidiary have good
title to their respective properties and assets, free and clear of all
mortgages, liens and encumbrances, except for mortgages, liens and
encumbrances (including covenants, restrictions, rights, easements and
minor irregularities in title) which do not have a Material Adverse
Effect or which are permitted by Section 5.02(a), and except that no
representation or warranty is being made with respect to Margin Stock.

(i) Except to the extent permitted pursuant to Section
5.02(e), neither the Borrower nor any Material Subsidiary is subject
to any contractual restrictions which limit the amount of dividends
payable by any Subsidiary.

(j) No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan which, with the giving of
notice or lapse of time, or both, would constitute an Event of Default
under Section 6.01(g).

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<PAGE> 49
(k) The statement of assets and liabilities of each Plan
and the statements of changes in fund balance and in financial
position, or the statement of changes in net assets available for plan
benefits, for the most recent plan year for which an accountant's
report with respect to such plan year has been prepared, copies of
which have been furnished to the Agent, fairly present the financial
condition of such Plan as at such date and the results of operations
of such Plan for the plan year ended on such date.

(l) Neither the Borrower nor any ERISA Affiliate has
incurred, or is reasonably expected to incur, any Withdrawal Liability
to any Multiemployer Plan which, when aggregated with all other
amounts required to be paid to Multiemployer Plans in connection with
Withdrawal Liability (as of the date of determination), exceeds
$50,000,000.

(m) Neither the Borrower nor any ERISA Affiliate has
received any notification that any Multiemployer Plan is in
reorganization or has been terminated, within the meaning of Title IV
of ERISA, and no Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated within the meaning of Title IV of
ERISA the effect of which reorganization or termination would be the
occurrence of an Event of Default under Section 6.01(i).

(n) The Borrower is not engaged in the business of
extending credit for the purpose of purchasing or carrying Margin
Stock, and no proceeds of any Advance will be used to extend credit to
others (other than to any Subsidiary of the Borrower) for the purpose
of purchasing or carrying Margin Stock.

(o) The Borrower is not an "investment company" or a
"company" controlled by an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.

(p) The Borrower is not a "holding company" or a
"subsidiary company" of a "holding company", or an "affiliate" of a
"holding company" or of a "subsidiary company" of a "holding company",
or a "public utility" within the meaning of the Public Utility Holding
Company Act of 1935, as amended.

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All representations and warranties made by the Borrower herein or made in any
certificate delivered pursuant hereto shall survive the making of the Advances
and the execution and delivery to the Lenders of this Agreement and the Notes.

ARTICLE V
COVENANTS OF THE BORROWER

SECTION 5.01. Affirmative Covenants. So long as any Note or
other amount payable by the Borrower hereunder shall remain unpaid or any
Lender shall have any Commitment hereunder, the Borrower will, unless the
Majority Lenders shall otherwise consent in writing:

(a) Preservation of Corporate Existence, Etc. Preserve
and maintain, and cause each Material Subsidiary to preserve and
maintain, its corporate existence, rights (charter and statutory) and
material franchises, except as otherwise permitted by Section 5.02(c)
or 5.02(d).

(b) Compliance with Laws, Etc. Comply, and cause each
Subsidiary to comply, in all material respects, with all applicable
laws, rules, regulations and orders (including, without limitation,
all environmental laws and laws requiring payment of all taxes,
assessments and governmental charges imposed upon it or upon its
property except to the extent contested in good faith by appropriate
proceedings) the failure to comply with which would have a Material
Adverse Effect.

(c) Visitation Rights. At such reasonable times and
intervals as the Agent or any of the Lenders (other than Designated
Bidders) may desire, permit the Agent or any of the Lenders (other
than Designated Bidders) to visit the Borrower and to discuss the
affairs, finances, accounts and mineral reserve performance of the
Borrower and any of its Subsidiaries with officers of the Borrower and
independent certified public accountants of the Borrower and any of
its Subsidiaries, provided that if an Event of Default, or an event
which with the giving of notice or the passage of time, or both, would
become an Event of Default, has occurred and is continuing, the Agent
or any Lender may, in addition to the other provisions of this
subsection (c) and at such reasonable times and intervals as the Agent
or any of the Lenders may desire, visit and inspect, under guidance of
officers of the Borrower, any properties significant to the
consolidated operations of the Borrower and its

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Subsidiaries, and to examine the books and records of account (other
than with respect to any mineral reserve information that the Borrower
determines to be confidential) of the Borrower and any of its
Subsidiaries and to discuss the affairs, finances and accounts of any
of the Borrower's Subsidiaries with any of the officers of such
Subsidiary.

(d) Books and Records. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, in which
full and correct entries shall be made of all financial transactions
and the assets and business of the Borrower and each Subsidiary in
accordance with generally accepted accounting principles either (i)
consistently applied or (ii) applied in a changed manner that does
not, under generally accepted accounting principles or public
reporting requirements applicable to the Borrower, either require
disclosure in the consolidated financial statements of the Borrower
and its consolidated Subsidiaries or require the consent of the
accountants which (as required by Section 5.03(b)) report on such
financial statements for the fiscal year in which such change shall
have occurred, or (iii) applied in a changed manner not covered by
clause (ii) above provided such change shall have been disclosed to
the Agent and shall have been consented to by the accountants which
(as required by Section 5.03(b)) report on the consolidated financial
statements of the Borrower and its consolidated Subsidiaries for the
fiscal year in which such change shall have occurred, provided that if
any change referred to in clause (ii) or (iii) above would not meet
the standard set forth in clause (i) or (ii) of Section 1.03, the
Agent, the Lenders and the Borrower agree to amend the covenants
contained in Section 5.01 and 5.02 so that the relative protection
afforded thereby to the Lenders and the relative flexibility afforded
thereby to the Borrower will in substance be retained after such
amendment, provided, however, that until such amendment becomes
effective hereunder, the covenants as set forth herein shall remain in
full force and effect and those accounting principles applicable to
the Borrower and its consolidated Subsidiaries which do meet the
standards set forth in clause (i) or (ii) of Section 1.03 shall be
applied to determine whether or not the Borrower is in compliance with
such covenants.

(e) Maintenance of Properties, Etc. Maintain and
preserve, and cause each Material Subsidiary to maintain and preserve,
all of its properties which are used in the

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conduct of its business in good working order and condition, ordinary
wear and tear excepted, to the extent that any failure to do so would
have a Material Adverse Effect.

(f) Maintenance of Insurance. Maintain, and cause each
Material Subsidiary to maintain, insurance with responsible and
reputable insurance companies or associations in such amounts and
covering such risks as is usually carried by companies engaged in
similar businesses and owning similar properties in the same general
areas in which the Borrower or such Subsidiary operates.

(g) Consolidated Tangible Net Worth. Maintain
Consolidated Tangible Net Worth of not less than $1,300,000,000 at all
times.

(h) Subsidiary Dividends. Cause each Subsidiary to pay
to the Borrower, or such Subsidiary's immediate parent company if such
parent company is not the Borrower, such dividends as such Subsidiary
may legally pay (giving due consideration to the rights of any
minority shareholders) to the extent necessary to provide the Borrower
with funds for the payment of its obligations under this Agreement and
the Notes.

SECTION 5.02. Negative Covenants. So long as any Note or
other amount payable by the Borrower hereunder shall remain unpaid or any
Lender shall have any Commitment hereunder, the Borrower will not, unless the
Majority Lenders shall otherwise consent in writing:

(a) Liens, Etc. (i) Create, assume or suffer to exist,
or permit any Material Subsidiary to create, assume or suffer to
exist, any Liens upon or with respect to any of the capital stock of
any Material Subsidiary, whether now owned or hereafter acquired, or
(ii) create or assume, or permit any Material Subsidiary to create or
assume, any Liens upon or with respect to any other assets material to
the consolidated operations of the Borrower and its consolidated
Subsidiaries taken as a whole securing the payment of Debt and
Guaranties in an aggregate amount (determined without duplication of
amount (so that the amount of a Guaranty will be excluded to the
extent the Debt Guaranteed thereby is included in computing such
aggregate amount)) exceeding $200,000,000 at any one time; provided,
however, that this subsection (a) shall not apply to:

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A. Liens on assets acquired by the Borrower or
any of its Subsidiaries after the date hereof to the extent
that such Liens existed at the time of such acquisition and
were not placed thereon by or with the consent of the Borrower
in contemplation of such acquisition;

B. Liens on stock acquired after the date hereof
of a corporation which has become or becomes a Subsidiary of
the Borrower, to the extent that such Liens existed at the
time of such acquisition and were not placed thereon by or
with the consent of the Borrower in contemplation of such
acquisition;

C. Liens on Margin Stock; and

D. Permitted Liens.

(b) Debt, Etc. Create, assume or suffer to exist, or
permit any of its consolidated Subsidiaries to create, assume or
suffer to exist, any Debt, any Guaranty or, to the extent set forth in
clause (1) below, any reimbursement obligation with respect to any
letter of credit, unless, immediately after giving effect to such
Debt, Guaranty or reimbursement obligation and the receipt and
application of any proceeds thereof or value received in connection
therewith,

(1) the sum (without duplication) of (i)
consolidated Debt of the Borrower and its consolidated
Subsidiaries plus (ii) the aggregate amount (determined on a
consolidated basis) of Guaranties and of letters of credit
issued for the account of the Borrower and its consolidated
Subsidiaries is less than 52.5% of Capitalization, provided
that Debt for borrowed money either maturing within one year
and evidenced by instruments commonly known as commercial
paper, or evidenced by variable demand notes or other similar
short-term financing instruments issued to commercial banks
and trust companies (other than Debt incurred pursuant to this
Agreement or the Long-Term Revolving Credit Agreement or any
replacement therefor), shall not exceed the aggregate of the
Borrower's unused bank lines of credit and unused credit
available to the Borrower under financing arrangements with
banks; and

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(2) with respect to any such Debt created,
assumed or suffered to exist by a consolidated Subsidiary that
is either a Subsidiary of the Borrower as of the date hereof
or a Subsidiary of the Borrower acquired or created after the
date hereof and owning a material portion of the consolidated
operating assets existing at the date hereof of the Borrower
and its Subsidiaries, the aggregate amount of Debt of the
consolidated Subsidiaries of the Borrower referred to above in
this paragraph (2) owing to Persons other than the Borrower
and its consolidated Subsidiaries is less than $400,000,000.

(c) Sale, Etc. of Assets. Sell, lease or otherwise
transfer, or permit any Material Subsidiary to sell, lease or
otherwise transfer (in either case, whether in one transaction or in a
series of transactions, and except, in either case, to the Borrower or
an entity which after giving effect to such transfer will be or become
a Material Subsidiary in which the Borrower's direct or indirect
equity interest will be at least as great as its direct or indirect
equity interest in the transferor immediately prior thereto, and
except as permitted by Section 5.02(d)), assets constituting a
material portion of the book value of the consolidated assets of the
Borrower and its Material Subsidiaries, provided that, notwithstanding
the foregoing, (i) assets restricted hereunder shall not include
Margin Stock or inventory sold in the ordinary course of business,
(ii) the Borrower or any Material Subsidiary may sell, lease or
otherwise transfer the assets or capital stock of any Subsidiary that
is not a Material Subsidiary as of the date of this Agreement, and
(iii) the Borrower or any Material Subsidiary may sell, lease or
otherwise transfer any Permitted Assets constituting a material
portion of the consolidated assets of the Borrower and its Material
Subsidiaries, provided that, for purposes of this clause (iii), (A)
such Permitted Assets are sold, leased or otherwise transferred in
exchange for other Permitted Assets and/or (B) the proceeds from such
sale, lease or other transfer, or an amount equal to the proceeds
thereof, are (x) reinvested within one year in Permitted Assets and/or
the development of Permitted Assets and/or (y) used to repay Debt the
proceeds of which were or are being used for investment in, and/or the
development of, Permitted Assets; provided further that, no such sale,
lease or other transfer shall be permitted by this clause (iii) unless
either (1) after giving effect to such sale,

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lease or other transfer, no Event of Default, and no event which with
lapse of time or the giving of notice, or both, would constitute an
Event of Default, shall have occurred and be continuing or (2) the
Borrower or the relevant Material Subsidiary, as the case may be, was
contractually obligated, prior to the occurrence of such Event of
Default or event, to consummate such sale, lease or other transfer.

(d) Mergers, Etc. Merge or consolidate with any Person,
or permit any of its Material Subsidiaries to merge or consolidate
with any Person, except that (i) such a Subsidiary may merge or
consolidate with (or liquidate into) any other Subsidiary or may merge
or consolidate with (or liquidate into) the Borrower, provided that
(A) if such Material Subsidiary merges or consolidates with (or
liquidates into) the Borrower, the Borrower shall be the continuing or
surviving corporation, (B) if any such Material Subsidiary merges or
consolidates with (or liquidates into) any other Subsidiary of the
Borrower, one of such Subsidiaries is the surviving corporation and,
if either such Subsidiary is not wholly-owned by the Borrower, such
merger or consolidation is on an arm's length basis and (C) as a
result of such merger or consolidation, no Event of Default, and no
event which with lapse of time or the giving of notice, or both, would
constitute an Event of Default, shall have occurred and be continuing,
and (ii) the Borrower or any Material Subsidiary may merge or
consolidate with any other corporation (that is, in addition to the
Borrower or any Subsidiary of the Borrower), provided that (A) if the
Borrower merges or consolidates with any such other corporation, the
Borrower is the surviving corporation, (B) if any Material Subsidiary
merges or consolidates with any such other corporation, the surviving
corporation is a wholly-owned Material Subsidiary of the Borrower, and
(C) if either the Borrower or any Material Subsidiary merges or
consolidates with any such other corporation, after giving effect to
such merger or consolidation no Event of Default, and no event which
with lapse of time or the giving of notice, or both, would constitute
an Event of Default, shall have occurred and be continuing.

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the date hereof of the Borrower and its Subsidiaries, to create, or
consent or agree to, any restrictions, contained in any agreement or
instrument relating to or evidencing Debt, on any such Subsidiary's
ability to pay dividends or to make advances to the Borrower or any
Subsidiary of the Borrower; provided, however, that this subsection
(e) shall not apply to any such restrictions (including any extensions
of the term of any thereof) applicable to the stock of any Subsidiary
of the Borrower the stock of which shall be hereafter acquired by the
Borrower and which restrictions are existing at the time such
Subsidiary first becomes a Subsidiary of the Borrower and are not
placed thereon by or with the consent of the Borrower in contemplation
of such acquisition by the Borrower.

SECTION 5.03. Reporting Requirements. So long as any Note
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will furnish to each Lender in such reasonable quantities as shall
from time to time be requested by such Lender:

(a) within 60 days after the end of each of the first
three quarters of each fiscal year of the Borrower, a consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as of
the end of such quarter, and consolidated statements of income and
cash flow of the Borrower and its consolidated Subsidiaries each for
the period commencing at the end of the previous fiscal year and
ending with the end of such quarter, certified (subject to normal
year-end adjustments) as to fairness and utilization of generally
accepted accounting principles by the chief financial officer of the
Borrower and accompanied by a certificate of such officer stating (i)
that such statements of income and cash flow and such balance sheet
have been prepared in accordance with generally accepted accounting
principles, (ii) whether or not such officer has knowledge of the
occurrence of any Event of Default which is continuing hereunder or of
any event not theretofore remedied which with notice or lapse of time
or both would constitute such an Event of Default and, if so, stating
in reasonable detail the facts with respect thereto, (iii) all
relevant facts in reasonable detail to evidence, and the computations
as to, whether or not the Borrower is in compliance with the
requirements set forth in subsection (g) of Section 5.01 and in
subsection (b) of Section 5.02, and (iv) a listing of all Material
Subsidiaries and consolidated

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Subsidiaries of the Borrower showing the extent of its direct and
indirect holdings of their stocks;

(b) within 120 days after the end of each fiscal year of
the Borrower, a copy of the annual report for such year for the
Borrower and its consolidated Subsidiaries containing financial
statements for such year reported on by nationally recognized
independent public accountants acceptable to the Lenders, accompanied
by (i) a report signed by said accountants stating that such financial
statements have been prepared in accordance with generally accepted
accounting principles and (ii) a letter from such accountants stating
that in making the investigations necessary for such report they
obtained no knowledge, except as specifically stated therein, of any
Event of Default which is continuing hereunder or of any event not
theretofore remedied which with notice or lapse of time or both would
constitute such an Event of Default;

(c) within 120 days after the close of each of the
Borrower's fiscal years, a certificate of the chief financial officer
of the Borrower stating (i) whether or not such officer has knowledge
of the occurrence of any Event of Default which is continuing
hereunder or of any event not theretofore remedied which with notice
or lapse of time or both would constitute such an Event of Default
and, if so, stating in reasonable detail the facts with respect
thereto, (ii) all relevant facts in reasonable detail to evidence, and
the computations as to, whether or not the Borrower is in compliance
with the requirements set forth in subsection (g) of Section 5.01 and
in subsection (b) of Section 5.02 and (iii) a listing of all Material
Subsidiaries and consolidated Subsidiaries of the Borrower showing the
extent of its direct and indirect holdings of their stocks;

(d) promptly upon their distribution, copies of all
financial statements, reports and proxy statements which the Borrower
or any Material Subsidiary shall have sent to its public stockholders;

(e) promptly upon their becoming publicly available, all
regular and periodic financial reports and registration statements
which the Borrower or any Material Subsidiary shall file with the
Securities and Exchange Commission or any national securities exchange
other than registration statements relating to employee

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benefit plans and to registration statements of securities for selling
security holders;

(f) promptly in writing, notice of all litigation and of
all proceedings before any governmental or regulatory agencies against
or involving the Borrower or any Material Subsidiary, except any
litigation or proceeding which in the reasonable judgment of the
Borrower (taking into account the exhaustion of all appeals) is not
likely to have a material adverse effect on the consolidated financial
condition of the Borrower and its consolidated Subsidiaries taken as a
whole;

(g) within three Business Days after an executive officer
of the Borrower obtains knowledge of the occurrence of any Event of
Default which is continuing or of any event not theretofore remedied
which with notice or lapse of time, or both, would constitute an Event
of Default, notice of such occurrence together with a detailed
statement by a responsible officer of the Borrower of the steps being
taken by the Borrower or the appropriate Subsidiary to cure the effect
of such event;

(h) as soon as practicable and in any event (i) within 30
days after the Borrower or any ERISA Affiliate knows or has reason to
know that any Termination Event described in clause (i) of the
definition of Termination Event with respect to any Plan has occurred
and (ii) within 10 days after the Borrower or any ERISA Affiliate
knows or has reason to know that any other Termination Event with
respect to any Plan has occurred, a statement of the chief financial
officer of the Borrower describing such Termination Event and the
action, if any, which the Borrower or such ERISA Affiliate proposes to
take with respect thereto;

(i) promptly and in any event within two Business Days
after receipt thereof by the Borrower or any ERISA Affiliate, copies
of each notice received by the Borrower or any ERISA Affiliate from
the PBGC stating its intention to terminate any Plan or to have a
trustee appointed to administer any Plan;

(j) promptly and in any event within 30 days after the
filing thereof with the Internal Revenue Service, copies of each
Schedule B (Actuarial Information) to the annual report (Form 5500
Series) with respect to each Plan;

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(k) promptly and in any event within five Business Days
after receipt thereof by the Borrower or any ERISA Affiliate from the
sponsor of a Multiemployer Plan, a copy of each notice received by the
Borrower or any ERISA Affiliate concerning (i) the imposition of
Withdrawal Liability by a Multiemployer Plan, (ii) the determination
that a Multiemployer Plan is, or is expected to be, in reorganization
within the meaning of Title IV of ERISA, (iii) the termination of a
Multiemployer Plan within the meaning of Title IV of ERISA, or (iv)
the amount of liability incurred, or expected to be incurred, by the
Borrower or any ERISA Affiliate in connection with any event described
in clause (i), (ii) or (iii) above; and

(l) as soon as practicable but in any event within 60
days of any notice of request therefor, such other information
respecting the financial condition and results of operations of the
Borrower or any Subsidiary as any Lender through the Agent may from
time to time reasonably request.

Each balance sheet and other financial statement furnished
pursuant to subsections (a) and (b) of this Section 5.03 shall contain
comparative information which conforms to the presentation required in Form
10-Q and Form 10-K, as appropriate, under the Securities Exchange Act of 1934,
as amended.

ARTICLE VI
EVENTS OF DEFAULT

SECTION 6.01. Events of Default. If any of the following
events ("Events of Default") shall occur and be continuing:

(a) The Borrower shall fail to pay any principal of any
Note when due, or any interest on any Note or any other amount payable
hereunder within five Business Days after the same shall be due; or

(b) Any representation or warranty made or deemed made by
the Borrower herein or by the Borrower (or any of its officers) in
connection with this Agreement shall prove to have been incorrect in
any material respect when made or deemed made; or

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Agreement on its part to be performed or observed and any such failure
shall remain unremedied for 30 days after written notice thereof shall
have been given to the Borrower by the Agent or by any Lender with a
copy to the Agent; or

(d) The Borrower or any Material Subsidiary shall fail to
pay any Debt or Guaranty (excluding Debt evidenced by the Notes) of
the Borrower or such Subsidiary (as the case may be) in an aggregate
principal amount of $50,000,000 or more, or any installment of
principal thereof or interest or premium thereon, when due (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to
such Debt or Guaranty; or any other default under any agreement or
instrument relating to any such Debt, or any other event, shall occur
and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such
default or event is to accelerate, or to permit the acceleration of,
the maturity of such Debt; provided that, notwithstanding any
provision contained in this subsection (d) to the contrary, to the
extent that pursuant to the terms of any agreement or instrument
relating to any Debt referred to in this subsection (d), any sale,
pledge or disposal of Margin Stock, or utilization of the proceeds
thereof would result in a breach of any covenant contained therein or
otherwise give rise to a default or event of default thereunder and/or
acceleration of the maturity of the Debt extended pursuant thereto and
as a result of such terms or of such sale, pledge, disposal,
utilization, breach, default, event of default or acceleration, or the
provisions hereof relating thereto, this Agreement or any Advance
hereunder would otherwise be subject to the margin requirements or any
other restriction under Regulation U issued by the Board of Governors
of the Federal Reserve System, then such breach, default, event of
default or acceleration shall not constitute a default or Event of
Default under this subsection (d); or

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Subsidiary seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it
or for any substantial part of its property; or (iii) any such
proceeding shall have been instituted against the Borrower or any such
Subsidiary and either such proceeding shall not be stayed or dismissed
for 60 consecutive days or any of the actions referred to above sought
in such proceeding (including, without limitation, the entry of an
order for relief against it or the appointment of a receiver, trustee,
custodian or other similar official for it or any substantial part of
its property) shall occur; or (iv) the Borrower or any such Subsidiary
shall take any corporate action to authorize any of the actions set
forth above in this subsection (e); or

(f) Any judgment or order for the payment of money in
excess of $50,000,000 shall be rendered against the Borrower or any
Material Subsidiary and either (i) enforcement proceedings shall have
been commenced by any creditor upon such judgment or order (other than
any enforcement proceedings consisting of the mere obtaining and
filing of a judgment lien or obtaining of a garnishment or similar
order so long as no foreclosure, levy or similar process in respect of
such lien, or payment over in respect of such garnishment or similar
order, has commenced) or (ii) there shall be any period of 30
consecutive days during which a stay of execution or enforcement
proceedings (other than those referred to in the parenthesis in clause
(i) above) in respect of such judgment or order, by reason of a
pending appeal, bonding or otherwise, shall not be in effect; or

(g) Any Termination Event with respect to a Material Plan
shall have occurred and, 30 days after notice thereof shall have been
given to the Borrower by the Lender, (i) such Termination Event shall
still exist and (ii) the sum (determined as of the date of occurrence
of such Termination Event) of the Insufficiency of such Plan and the
Insufficiency of any and all other Plans with respect to which a
Termination Event shall have occurred and then exist (or in the case
of a Plan with respect to which a Termination Event described in
clause (ii) of the definition of Termination Event shall have

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occurred and then exist, the liability related thereto), in each case
in respect of which the Borrower or any ERISA Affiliate has liability,
is equal to or greater than $50,000,000; or

(h) The Borrower or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount which,
when aggregated with all other amounts required to be paid to
Multiemployer Plans in connection with Withdrawal Liabilities
(determined as of the date of such notification), exceeds $50,000,000;
or

(i) The Borrower or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated,
within the meaning of Title IV of ERISA, if as a result of such
reorganization or termination the aggregate annual contributions of
the Borrower and its ERISA Affiliates to all Multiemployer Plans which
are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for
the respective plan years which include the date hereof by an amount
exceeding $50,000,000; or

(j) Upon completion of, and pursuant to, a transaction,
or a series of transactions (which may include prior acquisitions of
capital stock of the Borrower in the open market or otherwise),
involving a tender offer (i) a "person" (within the meaning of Section
13(d) of the Securities Exchange Act of 1934) other than the Borrower,
a Subsidiary of the Borrower or any employee benefit plan maintained
for employees of the Borrower and/or any of its Subsidiaries or the
trustee therefor, shall have acquired direct or indirect ownership of
and paid for in excess of 50% of the outstanding capital stock of the
Borrower entitled to vote in elections for directors of the Borrower
and (ii) at any time before the later of (x) six months after the
completion of such tender offer and (y) the next annual meeting of the
shareholders of the Borrower following the completion of such tender
offer more than half of the directors of the Borrower consists of
individuals who (a) were not directors before the completion of such
tender offer and (b) were not appointed, elected or nominated by the
Board of Directors in office prior to the completion of such tender
offer (other than any such appointment,

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election or nomination required or agreed to in connection with, or as
a result of, the completion of such tender offer); or

(k) Any "Event of Default" as defined in the Long-Term
Revolving Credit Agreement shall occur and be continuing;

then, and in any such event, the Agent shall at the request, or may with the
consent, of the Majority Lenders, by notice to the Borrower, (i) declare the
obligation of each Lender to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) declare the Notes, all interest thereon and
all other amounts payable under this Agreement to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower;
provided, however, that if an Event of Default under subsection (e) of this
Section 6.01 (except under clause (i)(A) thereof) shall occur, (A) the
obligation of each Lender to make Advances shall automatically be terminated
and (B) the Notes, all interest thereon and all other amounts payable under
this Agreement shall automatically become and be forthwith due and payable,
without presentment, demand, protest or any notice of any kind, all of which
are hereby expressly waived by the Borrower.

ARTICLE VII
THE AGENT

SECTION 7.01. Authorization and Action. Each Lender hereby
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the Agent
by the terms hereof, together with such powers as are reasonably incidental
thereto. As to any matters not expressly provided for by this Agreement
(including, without limitation, enforcement of this Agreement or collection of
the Notes), the Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall
be fully protected in so acting or refraining from acting) upon the
instructions of the Majority Lenders, and such instructions shall be binding
upon all Lenders and all holders of Notes; provided, however, that the Agent
shall not be required to take any action which exposes the Agent to personal
liability or which is contrary to this Agreement or applicable law. The Agent
agrees to give to each

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Lender prompt notice of each notice given to it by the Borrower pursuant to the
terms of this Agreement.

SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor
any of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them under or in connection with
this Agreement, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the Agent:
(i) may treat the payee of any Note as the holder thereof until the Agent
receives and accepts an Assignment and Acceptance entered into by the Lender
which is the payee of such Note, as assignor, and an Eligible Assignee, as
assignee, as provided in Section 8.07; (ii) may consult with legal counsel
(including counsel for the Borrower), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any
Lender and shall not be responsible to any Lender for any statements,
warranties or representations (whether written or oral) made in or in
connection with this Agreement; (iv) shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of this Agreement on the part of the Borrower or to inspect the
property (including the books and records) of the Borrower; (v) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any
other instrument or document furnished pursuant hereto; and (vi) shall incur no
liability under or in respect of this Agreement by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telegram,
telecopy, cable or telex) believed by it to be genuine and signed or sent by
the proper party or parties.

SECTION 7.03. Citibank and Affiliates. With respect to its
Commitments, the Advances made by it and the Notes issued to it, Citibank shall
have the same rights and powers under this Agreement as any other Lender and
may exercise the same as though it were not the Agent; and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated, include Citibank in its
individual capacity. Citibank and its affiliates may accept deposits from,
lend money to, act as trustee under indentures of, and generally engage in any
kind of business with, the Borrower, any of its Subsidiaries and any Person who
may do business with or own securities of the Borrower or any Subsidiary, all
as if

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Citibank were not the Agent and without any duty to account therefor to the
other Lenders.

SECTION 7.04. Lender Credit Decision. Each Lender
acknowledges that it has, independently and without reliance upon the Agent or
any other Lender and based on the financial statements referred to in Section
4.01 and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Agreement.

SECTION 7.05. Indemnification. The Lenders (other than the
Designated Bidders) agree to indemnify the Agent (to the extent not reimbursed
by the Borrower), ratably according to the respective principal amounts of the
A Notes then held by each of them (or if no A Notes are at the time outstanding
or if any A Notes are held by Persons which are not Lenders, ratably according
to the respective amounts of their Commitments or the respective amounts of
their Commitments immediately prior to termination if the Commitments have been
terminated), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against the Agent in any way relating to or arising out of this
Agreement or any action taken or omitted by the Agent under this Agreement,
provided that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Agent's gross negligence or
willful misconduct. Without limitation of the foregoing, each Lender (other
than the Designated Bidders) agrees to reimburse the Agent promptly upon demand
for its ratable share of any reasonable out-of-pocket expenses (including
counsel fees) incurred by the Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings, in bankruptcy or insolvency
proceedings, or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that the Agent acts in
its capacity as Agent and is not reimbursed for such expenses by the Borrower.

SECTION 7.06. Successor Agent. The Agent may resign at any
time by giving written notice thereof to the

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Lenders and the Borrower and may be removed at any time with or without cause
by the Majority Lenders. Upon any such resignation or removal, the Majority
Lenders shall have the right to appoint a successor Agent. If no successor
Agent shall have been so appointed by the Majority Lenders, and shall have
accepted such appointment, within 30 days after the retiring Agent's giving of
notice of resignation or the Majority Lenders' removal of the retiring Agent,
then such retiring Agent may, on behalf of the Lenders, appoint a successor
Agent, which shall be a commercial bank organized, or authorized to conduct a
banking business, under the laws of the United States of America or of any
State thereof and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation or
removal hereunder as Agent, the provisions of this Article VII shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.

ARTICLE VIII
MISCELLANEOUS

SECTION 8.01. Amendments, Etc. An amendment or waiver of any
provision of this Agreement or the A Notes, or a consent to any departure by
the Borrower therefrom, shall be effective against the Lenders and all holders
of the Notes if, but only if, it shall be in writing and signed by the Majority
Lenders, and then such a waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no such amendment, waiver or consent shall, unless in writing and
signed by all the Lenders (other than the Designated Bidders), be effective to:
(a) waive any of the conditions specified in Article III, (b) except as
contemplated by Section 2.20, increase the Commitments of the Lenders or
subject the Lenders to any additional obligations, (c) reduce the principal of,
or interest on, the A Notes or any facility fees hereunder, (d) postpone any
date fixed for any payment of principal of, or interest on, the A Notes or any
facility fees hereunder, (e) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the A Notes, which shall be required for
the Lenders or any of them to take any action under this Agreement, or (f)
amend this Section 8.01; and,

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provided further that no amendment, waiver or consent shall, unless in writing
and signed by the Agent in addition to the Lenders required hereinabove to take
such action, affect the rights or duties of the Agent under this Agreement or
any Note.

SECTION 8.02. Notices, Etc. Except as otherwise provided in
Section 2.02(a) or 2.10(ii), all notices and other communications provided for
hereunder shall be in writing and mailed by certified mail, return receipt
requested and postage prepaid, or telecopied, telefaxed or otherwise
teletransmitted, or delivered, if to the Borrower, at 5051 Westheimer, Suite
1400, Houston, Texas 77056, Attention: Treasurer, Telefax: (713) 624-9621; if
to any Initial Lender, at its Domestic Lending Office set forth opposite its
name on Schedule I hereto; if to any other Lender at its Domestic Lending
Office specified in the Assignment and Acceptance or Increase Agreement
pursuant to which it became a Lender or at the address for notices specified in
the Designation Agreement pursuant to which it became a party hereto; and if to
the Agent, in care of Citicorp North America, Inc., at 1200 Smith Street, Suite
2000, Houston, Texas 77002, Attention: Burlington Resources Inc., Account
Officer, Telefax: (713) 654-2849; or, as to each party, at such other address
as shall be designated by such party in a written notice to the other parties.
All such notices and communications shall be effective, (a) in the case of any
notice or communication given by certified mail, when receipted for, (b) in the
case of any notice or communication given by telecopy, telefax or other
teletransmission, when confirmed by appropriate answerback, in each case
addressed as aforesaid, and (c) in the case of any notice or communication
delivered by hand or courier, when so delivered, except that notices and
communications to the Agent pursuant to Article II or VII shall not be
effective until received by the Agent. A notice received by the Agent or a
Lender by telephone pursuant to Section 2.02(a) or 2.10(ii) shall be effective
if the Agent or Lender believes in good faith that it was given by an
authorized representative of the Borrower and acts pursuant thereto,
notwithstanding the absence of written confirmation or any contradictory
provision thereof.

SECTION 8.03. No Waiver; Remedies. No failure on the part of
any Lender or the Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder or under any Note preclude
any other or further exercise thereof or the exercise of any other

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right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

SECTION 8.04. Costs and Expenses; Indemnity.

(a) The Borrower agrees to pay on demand (i) all
reasonable fees and out-of-pocket expenses of counsel for the Agent in
connection with the preparation, execution and delivery of this Agreement, the
Notes and the other documents to be delivered hereunder and with respect
to advising the Agent as to its rights and responsibilities under this
Agreement, (ii) all reasonable costs and expenses incurred by the Agent and its
Affiliates in initially syndicating all or any portion of the Commitments
hereunder, including, without limitation, the related reasonable fees and
out-of-pocket expenses of counsel for the Agent or its Affiliates, travel
expenses, duplication and printing costs and courier and postage fees, and
excluding any syndication fees paid to other parties joining the syndicate and
(iii) all out-of-pocket costs and expenses, if any, of the Agent and the
Lenders (including reasonable counsel fees and expenses), in connection with
the enforcement (whether through negotiations, legal proceedings, in bankruptcy
or insolvency proceedings, or otherwise) of this Agreement, the Notes and the
other documents to be delivered hereunder and thereunder.

(b) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender on any day other than the last day of the Interest Period for such
Advance, as a result of a prepayment pursuant to Section 2.10 or a Conversion
pursuant to Section 2.08(f) or Section 2.09 or due to acceleration of the
maturity of the Notes pursuant to Section 6.01 or due to any other reason
attributable to the Borrower, the Borrower shall, upon demand by such Lender
(with a copy of such demand to the Agent), pay to the Agent for the account of
such Lender any amounts required to compensate such Lender for any additional
losses, costs or expenses which it may reasonably incur as a result of such
payment or Conversion, including, without limitation, any loss (excluding loss
of anticipated profits), cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance.

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Agent, the Arranger or such Lender in connection with or arising out of any
investigation, litigation, or proceeding (whether or not the Agent, the
Arranger or such Lender is party thereto) related to any acquisition or
proposed acquisition by the Borrower, or by any Subsidiary of the Borrower, of
all or any portion of the stock or substantially all the assets of any Person
or any use or proposed use of the Advances by the Borrower (excluding any
claims, damages, liabilities or expenses incurred by reason of the gross
negligence or willful misconduct of the party to be indemnified or its
employees or agents, or by reason of any use or disclosure of information
relating to any such acquisition or use or proposed use of the proceeds by the
party to be indemnified or its employees or agents).

SECTION 8.05. Right of Set-off. Upon the declaration of the
Notes as due and payable pursuant to the provisions of Section 6.01, each
Lender is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the
account of the Borrower against any and all of the obligations of the Borrower
now or hereafter existing under this Agreement and any Note held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under this Agreement or such Note and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Borrower after any such
set-off and application made by such Lender, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of each Lender under this Section 8.05 are in addition to other rights
and remedies (including, without limitation, other rights of set-off) which
such Lender may have.

SECTION 8.06. Binding Effect. This Agreement shall become
effective in accordance with the provisions of Section 3.01, and thereafter
shall be binding upon and inure to the benefit of the Borrower, the Agent, the
Arranger and each Lender and their respective successors and assigns, except
that the Borrower shall not have the right to assign its rights hereunder or
any interest herein without the prior written consent of all of the Lenders.

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SECTION 8.07. Assignments and Participations.

(a) Each Lender (other than a Designated Bidder) may
assign to one or more banks or other financial institutions all or a portion of
its rights and obligations under this Agreement (including, without limitation,
all or a portion of its Commitment, the A Advances owing to it and the A Note
or A Notes held by it); provided, however, that (i) each such assignment shall
be of a constant, and not a varying, percentage of all rights and obligations
under this Agreement (other than any right to make B Advances, any B Advances
or any B Notes), and the same constant percentage of all rights and obligations
of such assigning Lender under the Long-Term Revolving Credit Agreement, unless
the Long-Term Revolving Credit Agreement has been terminated, shall be
contemporaneously assigned by such assigning Lender to the same assignee
pursuant to Section 8.07(a) of the Long-Term Revolving Credit Agreement, (ii)
the sum of (x) the amount of the Commitment of the assigning Lender being
assigned to the assignee pursuant to each such assignment (determined as of the
date of the Assignment and Acceptance with respect to such assignment) plus (y)
the amount of the "Commitment" of the assigning Lender under the Long-Term
Revolving Credit Agreement contemporaneously assigned by such assigning Lender
to such assignee as contemplated by clause (i) of this sentence must be equal
to or greater than $25,000,000 and must be an integral multiple of $1,000,000,
(iii) each such assignment shall be to an Eligible Assignee, and (iv) the
parties to each such assignment shall execute and deliver to the Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance,
together with any A Note or A Notes subject to such assignment and a processing
and recordation fee of $3,000, and shall send to the Borrower an executed
counterpart of such Assignment and Acceptance. Upon such execution, delivery,
acceptance and recording, from and after the effective date specified in each
Assignment and Acceptance, (x) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have been assigned to
it pursuant to such Assignment and Acceptance, have the rights and obligations
of a Lender hereunder and (y) the Lender assignor thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto, provided, however, such assigning Lender shall retain any

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claim with respect to any fee, interest, cost, expense or indemnity which
accrues, or relates to an event that occurs, prior to the date of such
assignment pursuant to Section 2.03, 2.06, 2.07, 2.11, 2.12, 2.15 or 8.04).

(b) By executing and delivering an Assignment and
Acceptance, each Lender assignor thereunder and the assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (i)
other than as provided in such Assignment and Acceptance, such assigning Lender
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
this Agreement or the execution, legality, validity , enforceability,
genuineness, sufficiency or value of this Agreement or any other instrument or
document furnished pursuant hereto; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or the performance or observance by the
Borrower of any of its obligations under this Agreement or any other instrument
or document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee confirms that it is
(subject to approval in writing by the Borrower and the Agent) an Eligible
Assignee; (vi) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to the Agent by the terms hereof, together with such powers as
are reasonably incidental thereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.

(c) The Agent shall maintain at its address referred to
in Section 8.02 a copy of each Assignment and Acceptance, each Designation
Agreement and each Increase Agreement delivered to and accepted by it and a
register for the recordation of the names and addresses of the Lenders and,
with respect to Lenders other than Designated Bidders, the Commitment of, and
principal amount of the A Advances owing

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to, each Lender from time to time (the "Register"). The entries in the
Register shall be conclusive and binding for all purposes, absent manifest
error, and the Borrower, the Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or
any Lender at any reasonable time and from time to time upon reasonable prior
notice.

(d) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an assignee representing that it is an
Eligible Assignee, together with any A Note or A Notes subject to such
assignment, the Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit E hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower. Within five
Business Days after its receipt of such notice and its receipt of an executed
counterpart of such Assignment and Acceptance, the Borrower, at its own
expense, shall execute and deliver to the Agent in exchange for the surrendered
A Note or A Notes a new A Note to the order of such Eligible Assignee in an
amount equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder, a
new A Note to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new A Note or A Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered A Note or A Notes, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be in substantially the form of
Exhibit A hereto.

(e) Each Lender (other than a Designated Bidder) may
designate one or more banks or other entities to have a right to make B
Advances as a Lender pursuant to Section 2.19; provided that (i) such Lender
shall have obtained the written consent of the Agent and the Borrower, such
consent not to be unreasonably withheld, (ii) no such Lender shall be entitled
to make more than two such designations, (iii) each such Lender making one or
more of such designations shall retain the right to make B Advances as a Lender
pursuant to Section 2.19, (iv) each such designation shall be to a Designated
Bidder and (v) the parties to each such designation shall execute and deliver
to the Agent, for its acceptance and recording in the Register, a Designation
Agreement. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Designation Agreement,

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the designee thereunder shall be a party hereto with a right to make B Advances
as a Lender pursuant to Section 2.19 and the obligations related thereto.

(f) By executing and delivering a Designation Agreement,
the Lender making the designation thereunder and its designee thereunder
confirm and agree with each other and the other parties hereto as follows: (i)
such Lender makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with this Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any
other instrument or document furnished pursuant hereto, (ii) such Lender makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or the performance or observance by the
Borrower of any of its obligations under this Agreement or any other instrument
or document furnished pursuant hereto; (iii) such designee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into the Designation Agreement; (iv) such designee will, independently
and without reliance upon the Agent, such designating Lender or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such designee confirms that it is a Designated
Bidder; (vi) such designee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to the Agent by the terms hereof, together with such powers as
are reasonably incidental thereto, and (vii) such designee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.

(g) Upon its receipt of a Designation Agreement executed
by a designating Lender and a designee representing that it is a Designated
Bidder, the Agent shall, if such Designation Agreement has been completed and
is substantially in the form of Exhibit K hereto, (i) accept such Designation
Agreement, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.

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(h) Each Lender may sell participations to one or more
banks or other entities in or to all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Commitment, and the Advances owing to it and the Note or Notes held by it);
provided, however, that (i) such Lender's obligations under this Agreement
(including, without limitation, its Commitment to the Borrower hereunder) shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) such Lender shall
remain the holder of any such Note for all purposes of this Agreement, (iv) the
Borrower, the Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement, (v) such Lender shall continue to be able to
agree to any modification or amendment of this Agreement or any waiver
hereunder without the consent, approval or vote of any such participant or
group of participants, other than modifications, amendments and waivers which
(A) postpone any date fixed for any payment of, or reduce any payment of,
principal of or interest on such Lender's Note or any facility fees payable
under this Agreement, or (B) increase the amount of such Lender's Commitment in
a manner which would have the effect of increasing the amount of a
participant's participation, or (C) reduce the interest rate payable under this
Agreement and such Lender's Note, or (D) consent to the assignment or the
transfer by the Borrower of any of its rights and obligations under the
Agreement, and (vi) except as contemplated by the immediately preceding clause
(v), no participant shall be deemed to be or to have any of the rights or
obligations of a "Lender" hereunder.

(i) Any Lender may, in connection with any assignment,
designation or participation or proposed assignment, designation or
participation pursuant to this Section 8.07, disclose to the assignee, designee
or participant or proposed assignee, designee or participant, any information
relating to the Borrower furnished to such Lender by or on behalf of the
Borrower; provided that, prior to any such disclosure, the assignee, designee
or participant or proposed assignee, designee or participant shall agree in
writing for the benefit of the Borrower to preserve the confidentiality of any
confidential information relating to the Borrower received by it from such
Lender in a manner consistent with Section 8.08.

(j) Anything in this Agreement to the contrary
notwithstanding, any Lender may at any time create a security

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interest in all or any portion of its rights under this Agreement (including,
without limitation, the Advances owing to it) and the Notes issued to it
hereunder in favor of any Federal Reserve Bank in accordance with Regulation A
of the Board of Governors of the Federal Reserve System (or any successor
regulation) and the applicable operating circular of such Federal Reserve Bank.

(k) Each Lender may assign to one or more Eligible
Assignees any B Note or B Notes held by it.

SECTION 8.08. Confidentiality. Each Lender and the Agent
(each, a "party") agrees that it will use its best reasonable efforts not to
disclose, without the prior consent of the Borrower (other than to its, or its
Affiliate's, employees, auditors, accountants, counsel or other
representatives, whether existing at the date of this Agreement or any
subsequent time), any information with respect to the Borrower which is
furnished pursuant to this Agreement, provided that any party may disclose any
such information (i) as has become generally available to the public, (ii) as
may be required or appropriate in any report, statement or testimony submitted
to any municipal, state or Federal regulatory body having or claiming to have
jurisdiction over such party or to the Board of Governors of the Federal
Reserve System or the Federal Deposit Insurance Corporation or similar
organizations (whether in the United States or elsewhere) or their successors,
(iii) as may be required or appropriate in response to any summons or subpoena
or in connection with any litigation or regulatory proceeding, (iv) in order to
comply with any law, order, regulation or ruling applicable to such party, or
(v) to any prospective assignee, designee or participant in connection with any
contemplated assignment of any rights or obligations hereunder, any designation
or any sale of any participation therein, by such party pursuant to Section
8.07, if such prospective assignee, designee or participant, as the case may
be, executes an agreement with the Borrower containing provisions substantially
similar to those contained in this Section 8.08; provided, however, that the
Borrower acknowledges that the Agent has disclosed and may continue to disclose
such information as the Agent in its sole discretion determines is appropriate
to the Lenders from time to time.

SECTION 8.09. Consent to Jurisdiction.

(a) The Borrower hereby irrevocably submits to the
jurisdiction of any New York State or Federal court sitting in New York City
and any appellate court from any thereof in any

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<PAGE> 76
action or proceeding by the Agent, the Arranger, any Lender or the holder of
any Note in respect of, but only in respect of, any claims or causes of action
arising out of or relating to this Agreement or the Notes (such claims and
causes of action, collectively, being "Permitted Claims"), and the Borrower
hereby irrevocably agrees that all Permitted Claims may be heard and
determined in such New York State court or in such Federal court. The Borrower
hereby irrevocably waives, to the fullest extent it may effectively do so, the
defense of an inconvenient forum to the maintenance of such action or
proceeding in any aforementioned court in respect of Permitted Claims. The
Borrower hereby irrevocably appoints CT Corporation System (the "Process
Agent"), with an office on the date hereof at 1633 Broadway, New York, New York
10019, as its agent to receive on behalf of the Borrower and its property
service of copies of the summons and complaint and any other process which may
be served by the Agent, the Arranger, any Lender or the holder of any Note in
any such action or proceeding in any aforementioned court in respect of
Permitted Claims. Such service may be made by delivering a copy of such
process to the Borrower by courier and by certified mail (return receipt
requested), fees and postage prepaid, both (i) in care of the Process Agent at
the Process Agent's above address and (ii) at the Borrower's address specified
pursuant to Section 8.02, and the Borrower hereby irrevocably authorizes and
directs the Process Agent to accept such service on its behalf. The Borrower
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law.

(b) Nothing in this Section 8.09 (i) shall affect the
right of the Arranger, the Borrower, any Lender, the holder of any Note or the
Agent to serve legal process in any other manner permitted by law or affect any
right otherwise existing of the Borrower, any Lender, the Arranger, the holder
of any Note or the Agent to bring any action or proceeding in the courts of
other jurisdictions or (ii) shall be deemed to be a general consent to
jurisdiction in any particular court or a general waiver of any defense or a
consent to jurisdiction of the courts expressly referred to in subsection (a)
above in any action or proceeding in respect of any claim or cause of action
other than Permitted Claims.

SECTION 8.10. Governing Law. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State
of New York.

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SECTION 8.11. Execution in Counterparts. This Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery to the Agent of a counterpart executed by a Lender shall
constitute delivery of such counterpart to all of the Lenders.

IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.

BURLINGTON RESOURCES INC.

By: /s/ Everett D. DuBois
Name: Everett D. DuBois
Title: Treasurer

CITIBANK, N.A., as Agent

By: /s/ Barbara A. Cohen
Name: Barbara A. Cohen
Title: Vice President

Commitments The Initial Lenders
- ----------- -------------------

$30,000,000 CITIBANK, N.A.

By: /s/ Barbara A. Cohen
Name: Barbara A. Cohen
Title: Vice President

$30,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK

By: /s/ Vernon M. Ford, Jr.
Name: Vernon M. Ford, Jr.
Title: Vice President

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<PAGE> 78
Commitments
- -----------

$30,000,000 NATIONSBANK OF TEXAS, N.A.

By: /s/ Paul A. Squires
Name: Paul A. Squires
Title: Senior Vice President

$30,000,000 TEXAS COMMERCE BANK NATIONAL
ASSOCIATION

By: /s/ Scott Richardson
Name: Scott Richardson
Title: Vice President

$21,000,000 BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION

By: /s/ David E. Sisler
Name: David E. Sisler
Title: Vice President

$21,000,000 THE FIRST NATIONAL BANK OF BOSTON

By: /s/ Cynthia A. Stableford
Name: Cynthia A. Stableford
Title: Vice President

$21,000,000 CREDIT LYONNAIS CAYMAN ISLAND
BRANCH

By: /s/ Xavier Ratouis
Name: Xavier Ratouis
Title: Authorized Signature

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<PAGE> 79
Commitments
- -----------

$21,000,000 MELLON BANK, N.A.

By: /s/ A.J. Sabatelle
Name: A.J. Sabatelle
Title: Vice President

$21,000,000 TORONTO DOMINION (TEXAS), INC.

By: /s/ Warren Finlay
Name: Warren Finlay
Title: Vice President

$12,500,000 ABN AMRO BANK N.V.

By: /s/ W. Bryan Chapman
Name: W. Bryan Chapman
Title: Vice President

By: /s/ C.W. Randall
Name: C.W. Randall
Title: Group Vice President

$12,500,000 THE BANK OF TOKYO, LTD.

By: /s/ Michael Meiss
Name: Michael Meiss
Title: Vice President & Manager

$12,500,000 FIRST INTERSTATE BANK OF
TEXAS, N.A.

By: /s/ Ann M. Rhoads
Name: Ann M. Rhoads
Title: Vice President

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<PAGE> 80
Commitments
- -----------

$12,500,000 THE NORTHERN TRUST COMPANY

By: /s/ Martin G. Alston
Name: Martin G. Alston
Title: Vice President

$12,500,000 THE SUMITOMO BANK, LIMITED,
HOUSTON AGENCY

By: /s/ Tatsuo Ueda
Name: Tatsuo Ueda
Title: General Manager

$12,500,000 UNION BANK OF SWITZERLAND

By: /s/ Evans Swann
Name: Evans Swann
Title: Vice President

By: /s/ Jean Claude de Roche
Name: Jean Claude de Roche
Title: Assistant Vice President

$300,000,000 Total of the Commitments
============

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<PAGE> 1
EXHIBIT 10.25

BURLINGTON RESOURCES INC.

$600,000,000

LONG-TERM REVOLVING CREDIT AGREEMENT

Dated as of

July 20, 1994

CITIBANK, N.A., as Agent
<PAGE> 2
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01. The A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.02. Making the A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.03. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.04. Reduction of the Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.05. Repayment of A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.06. Interest on A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.07. Additional Interest on Eurodollar
Rate Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.08. Interest Rate Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.09. Voluntary Conversion of A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 2.10. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.11. Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.12. Increased Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.13. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.14. Payments and Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.15. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.16. Sharing of Payments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.17. Evidence of Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.18. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.19. The B Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.20. Increase of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE III
CONDITIONS OF EFFECTIVENESS AND LENDING

SECTION 3.01. Conditions Precedent to
Effectiveness of this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 3.02. Conditions Precedent to Each
A Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 3.03. Conditions Precedent to Each
B Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
</TABLE>
<PAGE> 3
<TABLE>
<S> <C> <C>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES

SECTION 4.01. Representations and Warranties of
the Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

ARTICLE V
COVENANTS OF THE BORROWER

SECTION 5.01. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 5.02. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 5.03. Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

ARTICLE VI
EVENTS OF DEFAULT

SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

ARTICLE VII
THE AGENT

SECTION 7.01. Authorization and Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 7.02. Agent's Reliance, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 7.03. Citibank and Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 7.04. Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 7.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 7.06. Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

ARTICLE VIII
MISCELLANEOUS

SECTION 8.01. Amendments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 8.02. Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 8.03. No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 8.04. Costs and Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 8.05. Right of Set-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 8.06. Binding Effect 64
SECTION 8.07. Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 8.08. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 8.09. Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
SECTION 8.10. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 8.11. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
</TABLE>

-ii-
<PAGE> 4
EXHIBITS

Exhibit A Form of A Promissory Note
Exhibit B Form of B Promissory Note
Exhibit C Form of Notice of A Borrowing
Exhibit D Form of Notice of B Borrowing
Exhibit E Form of Assignment and Acceptance
Exhibit F-1 Form of Commitment Increase Agreement
Exhibit F-2 Form of New Lender Agreement
Exhibit G Form of Opinion of Vice President, Law for Borrower
Exhibit H Form of Opinion of Fried, Frank, Harris, Shriver &
Jacobson, New York Counsel for Borrower
Exhibit I Form of Opinion of Counsel to Citibank, N.A., as Agent
Exhibit J Form of Process Agent Letter
Exhibit K Form of Designation Agreement

SCHEDULES

Schedule I -- Domestic and Eurodollar Lending Offices
Schedule II -- Material Subsidiaries
Schedule III -- Pricing Grid

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LONG-TERM REVOLVING CREDIT AGREEMENT