BURLINGTON RESOURCES INC, 10-K405, 1996-02-08

BURLINGTON RESOURCES INC
10-K405, 1996-02-08
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, 1995

( ) 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, SUITE 1400, 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,
1995: $4,968,044,376

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, 1995, Shares Outstanding: 126,574,379

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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BURLINGTON RESOURCES INC.

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
<S> <C>
PART I
Items One and Two
Business and Properties......................................................... 1
Employees....................................................................... 8
Item Three
Legal Proceedings............................................................... 8
Item Four
Submission of Matters to a Vote of Security Holders............................. 8
Executive Officers of the Registrant and Principal Subsidiary................... 9

PART II
Item Five
Market for Registrant's Common Equity and Related Stockholder Matters........... 10
Item Six
Selected Financial Data......................................................... 10
Item Seven
Management's Discussion and Analysis of Financial Condition and Results of
Operations.................................................................... 11
Item Eight
Financial Statements and Supplementary Financial Information.................... 15
Item Nine
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.................................................................... 33

PART III
Items Ten and Eleven
Directors and Executive Officers of the Registrant and Executive Compensation... 33
Item Twelve
Security Ownership of Certain Beneficial Owners and Management.................. 33
Item Thirteen
Certain Relationships and Related Transactions.................................. 33

PART IV
Item Fourteen
Exhibits, Financial Statement Schedules and Reports on Form 8-K................. 34
</TABLE>
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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. 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 6.7 TCFE at December
31, 1995.

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 8.

GENERAL INFORMATION

The Company's objective is to build long-term shareholder value through
value-added growth and effective cost management by increasing production,
reserves, earnings and cash flow. The Company intends to achieve this objective
by increasing its focus on high potential exploration and development projects,
acquisitions and the application of advanced technologies.

The Company's operations are located principally in the San Juan Basin, the
Gulf Coast Basin, the Permian Basin, the Anadarko 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 leasehold acreage in this area with over 1.1
million net acres under its control. The Company has an interest in over 10,500
wells and currently operates approximately 7,000 of these wells. Approximately
60 percent of the Company's reserves are located in this basin. During 1995, the
Company's daily net production in this basin averaged 700 MMCF of gas per day,
representing approximately 60 percent of the Company's total daily gas
production.

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
natural gas which is adsorbed to the surface of coal seams. The Company
continues to be an industry leader in the development of the Fruitland Coal
formation. The Company's net coal seam production from approximately 1,700 wells
averaged 350 MMCF of gas per day during 1995.

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 420 miles of gathering
lines and ten compressor stations to gather and treat coal seam gas in the San
Juan Basin.

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

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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 three dimensional ("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. Subsequent acquisitions of
producing properties as well as successful lease acquisitions have expanded the
Company's interest to 115 blocks, of which 51 are operated, in offshore Federal
and State waters. During 1995, the Company invested nearly $90 million in
offshore operations including the participation in 23 drill wells and 12
workovers and has begun the planning or construction of 5 new platforms. The
most notable platform project underway is a 100 MMCF of gas per day platform and
processing facilities which will be installed in 400 feet of water in High
Island Block A-371 as the result of an exploratory discovery made in late 1994.
This operated project, in which the Company owns a 100% working interest, will
be installed in early 1996, with simultaneous drilling and production activities
taking place during the second half of 1996. The Company's investments in its
offshore assets have resulted in the offset of the extensive decline rates
characteristic of Gulf Coast Basin production. As a result, the Company's 1995
production volumes averaged 111 MMCF of gas per day. At year end 1995, the
Company had a combined initial productive capacity of 75 MMCF of gas per day and
2,000 Bbls of oil per day from wells awaiting the necessary production
facilities, a portion of which is associated with the High Island Block A-371
project.

Onshore

The Company's onshore activities in the Gulf Coast Basin are primarily
concentrated in Luling, Darst Creek and the West Ranch area in south Texas as
well as the Garden City, Lake Arthur, and Sulphur Mines Fields in south
Louisiana. 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 1995, 16 horizontal wells were drilled
in these fields at a net cost of approximately $6 million. During 1995, net
production from the Luling and Darst Creek Fields averaged 4 MBbls of oil per
day, with 56 percent of this production attributable to horizontal wells drilled
since these properties were acquired in 1989.

The application of 3D seismic technology has been instrumental for the
exploitation of the south Louisiana fields due to the complex structural nature
of the stacked pay intervals. In 1995, the Company invested $15 million in south
Louisiana which included over 40 square miles of seismic data and the drilling
of 6 wells. During 1995, net production from south Louisiana fields averaged 23
MMCF of gas per day and 1 MBbls of oil per day.

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 11,400 Permian Basin wells and operates over 3,300 of these
wells resulting in average net production during 1995 of 17 MBbls of oil per day
and 142 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 largest consolidated block of acreage in this basin
in which the Company has an interest is the Waddell Ranch, located 40 miles west
of Midland, Texas. The Company operates over 1,300 wells on the Waddell Ranch
resulting in average net production of 5 MBbls of oil per day and 22 MMCF of gas
per day during 1995.

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Due to the complex geologic nature of the Permian Basin, 3D seismic
technology has been an effective exploitation tool in this area. In 1995, over
300 additional square miles were surveyed for a total investment of
approximately $5 million. The utilization of 3D data resulted in the drilling of
33 wells in 1995, including 6 horizontal wells. This drilling program led to the
discovery of 4 new fields in the Permian Basin.

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 500,000 net acres
principally located in the Anadarko Basin of western Oklahoma. The Company
operates 788 wells in this basin and total net production during 1995 averaged
125 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 1995,
the Company participated in the drilling of 41 wells to these formations at a
net cost of approximately $35 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
3.2 million net acres, primarily in the U.S. portion of the basin, through both
mineral and leasehold interests.

The Company continues its activity in the Williston Basin of North Dakota
and Montana through the use of advanced technologies such as 3D seismic and
horizontal drilling. In 1995, the Company was very active in exploration
programs such as the Lodgepole and River Run plays of North Dakota. The Company
also continues to use horizontal drilling to exploit reserves along the Cedar
Creek anticline in Montana. In total, the Company participated in the completion
of 44 horizontal wells in 1995 throughout the Williston Basin at a net cost of
approximately $33 million. During 1995, net oil production from the Williston
Basin averaged 13 MBbls of oil per day.

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 $1.03 per million British Thermal Unit depending on fuel
source. The Company earned approximately $82 million of tax credits in 1995.

CAPITAL EXPENDITURES AND MAJOR PROJECTS

Following are the Company's capital expenditures.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------
1995 1994 1993
-------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Oil and Gas Activities........................... $547,113 $810,466 $501,191
Plants and Pipelines............................. 27,979 36,026 33,327
Administrative................................... 13,703 35,153 18,866
-------- -------- --------
Total.................................. $588,795 $881,645 $553,384
======== ======== ========
</TABLE>

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Capital expenditures for oil and gas activities in 1995 of $547 million
include 19 percent for proved property acquisitions, 59 percent for
developmental drilling and 22 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 1995 was principally in the San Juan, Gulf Coast,
Permian, Anadarko and Williston basins. Total drilling activity levels are
consistent with those reported at year end 1994. Additionally, 1995 activity
includes a 50 percent increase in workover activity and an increased focus on
higher potential exploration and development projects with commensurately higher
risk.

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

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------
1995 1994 1993
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Productive wells:
Exploratory..................................... 18.1 15.9 7.2
Development..................................... 291.7 342.2 243.7
----- ----- -----
309.8 358.1 250.9
----- ----- -----
Dry wells:
Exploratory..................................... 15.8 3.7 9.0
Development..................................... 37.8 13.3 11.6
----- ----- -----
53.6 17.0 20.6
----- ----- -----
Total net wells......................... 363.4 375.1 271.5
===== ===== =====
</TABLE>

As of December 31, 1995, 20 gross wells, representing approximately 13 net
wells, were being drilled.

Asset Rationalization

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 reserves as well as
properties having upside potential that can be developed by the utilization of
both conventional and advanced technologies.

As a component of its overall growth strategy, the Company acquired 187
BCFE of producing oil and gas properties at a cost of approximately $104 million
during 1995. Approximately 45 percent of the reserves acquired during the year
were located in the prolific Gulf Coast Basin. The Company will continue to
pursue transactions which enable the consolidation of assets and increase
operating efficiencies.

In an effort to maintain its high quality asset base, the Company continues
to divest marginal and non-strategic assets. During 1995, the Company divested
over 4,300 working interest wells comprising approximately 14 percent of the
Company's working interest well inventory. In addition, the Company conveyed its
working interests in certain coal seam gas wells in August 1995. In February
1995, the Company completed the sale of its intrastate natural gas pipeline
systems and its underground natural gas storage facility, including gas
inventory, for approximately $80 million. The net proceeds after tax from all
1995 asset divestitures were approximately $146 million. The Company expects to
continue divesting marginal and non-strategic assets in 1996.

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PRODUCTIVE WELLS, DEVELOPED AND UNDEVELOPED ACREAGE

Working interests in productive wells, developed acreage and undeveloped
leasehold acreage at December 31, 1995 follow.

<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>
12,728 4,832 14,552 8,672 5,824,000 3,065,000 2,760,000 1,582,000
</TABLE>

Included in the productive wells data are 777 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. Following
are production and prices.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1995 1994 1993
------ ------ ------
<S> <C> <C> <C>
Production:
Gas (MMCF per day)................................. 1,165 1,052 920
Oil (MBbls per day)................................ 48.0 45.6 41.9
Average sales prices:
Gas per MCF........................................ $ 1.25 $ 1.65 $ 1.87
Oil per barrel..................................... 16.69 15.66 16.71
Average production costs per MCFE.................... .51 .54 .56
Depreciation, depletion and amortization rates per
MCFE............................................... .63 .62 .58
</TABLE>

In 1995, 1994 and 1993, approximately 58 percent, 66 percent and 69
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
continue to transport a substantial portion of its future gas production through
EPNG's pipeline system.

RESERVES

The following table sets forth estimates by the Company's petroleum
engineers of proved oil and gas reserves at December 31, 1995. 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...................... 4,543 168.1 5,552
Proved Undeveloped Reserves.................... 964 28.8 1,137
----- ----- -----
Total Proved Reserves................ 5,507 196.9 6,689
===== ===== =====
</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."

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INTRASTATE PIPELINES AND NGLS

The Company owns and operates gathering systems in several states. In
February 1995, the Company completed the sale of its intrastate natural gas
pipeline systems and its underground gas storage facility, including gas
inventory, for approximately $80 million.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------
1995 1994 1993
---- ----- ----
(BCF)
<S> <C> <C> <C>
Annual intrastate natural gas throughput:
Company-owned production.................... 1 16 19
Third party production...................... 1 49 41
Third party gas transportation and gathering..... 107 132 139
--- --- ---
Total.................................. 109 197 199
=== === ===
</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 13.3 MMBbls, 12.7 MMBbls and 14.9 MMBbls, for the years
ended December 31, 1995, 1994 and 1993, respectively.

MARKETING

Marketing Strategy. In pursuit of its strategy to build long-term
shareholder value 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, exchanging and transporting
hydrocarbons for both itself and third parties. Financial instruments and
fixed-price gas sales contracts are used from time to time in order to hedge the
price of a portion of the Company's production.

Wellhead Marketing. Substantially all of the Company's oil and gas
production is sold on the spot market and under short-term contracts at market
sensitive prices. Substantially all of the Company's gas production is sold to
Meridian Oil Trading Inc. ("MOTI"), a wholly-owned marketing subsidiary of the
Company. A majority of the Company's crude oil production is sold at the
wellhead 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 oil, gas 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 and federal 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 gathering systems and NGL pipelines. The
United States Department of Transportation and comparable state agencies
regulate, under various enabling statutes, the

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safety aspects of the transportation and storage activities of these 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 fully implemented its Order No. 636 series which fundamentally
restructured the rates and operations of interstate pipeline companies.
Additionally, the FERC has implemented new policies deregulating the field area
services of affiliates of interstate pipeline companies. Both of these orders
have been appealed.

The FERC has instituted proceedings concerning offshore and interstate
pipeline companies' incentive ratemaking. These proceedings are in their early
stages. The Company does not expect that these proceedings will 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.

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.

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.

Filings of Reserve Estimates With Other Agencies. During 1995, the Company
filed estimates of oil and gas reserves for the year 1994 with the Department of
Energy. These estimates were not materially different from the reserve data
presented herein.

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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(++)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, "MMBTU"
means million British thermal units, "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 1,796 and 1,846 employees at December 31, 1995 and 1994,
respectively.

ITEM THREE

LEGAL PROCEEDINGS

On May 25, 1995, the 270th Judicial District Court of Harris County, Texas
entered an order in a lawsuit styled Caroline Altheide, et al. v. Meridian Oil
Inc., et al. which allows the suit to be maintained as a class action on behalf
of all royalty and overriding royalty interest owners in all Meridian properties
and all working interest owners in properties operated by Meridian who have
received payments from Meridian at any time from and after December 1, 1986
based upon wellhead sales of natural gas to MOTI. The lawsuit involves claims
for unspecified actual and punitive damages based upon alleged breaches of
duties owed to interest owners because of the use of Meridian corporate
affiliates to gather, treat and market natural gas. The plaintiffs allege that
Meridian's gas producing affiliates have sold natural gas to marketing
affiliates at low inter-affiliate settlement prices which are then used as the
basis for accounting to interest owners. Plaintiffs also allege that Meridian's
pricing includes inappropriate deductions of inflated gathering and
transportation costs. Meridian is vigorously defending this litigation and
perfected an interlocutory appeal of the class certification order on May 30,
1995. This appeal effectively stays class action proceedings in the trial court
until the appeal is completed. Oral argument in this appeal has been set for
February 28, 1996.

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 and other proceedings cannot
be predicted with certainty, management expects these matters, including the
above-described Altheide litigation, 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 1995, no matters were submitted to a vote of
security holders.

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EXECUTIVE OFFICERS OF THE REGISTRANT AND PRINCIPAL SUBSIDIARY

THOMAS H. O'LEARY, 61

Chairman of the Board
Burlington Resources Inc.
December 1995 to Present

Chairman of the Board, President and Chief Executive Officer, February 1993
to December 1995; 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.

BOBBY S. SHACKOULS, 45

President and Chief Executive Officer
Burlington Resources Inc.
December 1995 to Present

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, 39

Executive Vice President and Chief Financial
Officer
Burlington Resources Inc.
December 1995 to Present

Executive Vice President and Chief Financial Officer, Meridian Oil Inc.,
March 1993 to Present; Senior Vice President and Chief Financial Officer,
Burlington Resources Inc., April 1994 to December 1995; Vice President, Finance,
Burlington Resources Inc., March 1992 to February 1993; Vice President, Taxes,
Burlington Resources Inc., December 1990 to March 1992.

HAROLD E. HAUNSCHILD, 45

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 June 1992.

RANDOLPH P. MUNDT, 45

Executive Vice President, Marketing
Meridian Oil Inc.
March 1995 to Present

Senior Vice President, Operations, Meridian Oil Inc., October 1994 to March
1995; Senior Vice President, Acquisitions and Land, Meridian Oil Inc., July 1993
to October 1994; Senior Vice President, Strategic Planning and Asset Management,
Meridian Oil Inc., December 1990 to July 1993.

C. RAY OWEN, 50

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.

GERALD J. SCHISSLER, 51

Executive Vice President, Law
Burlington Resources Inc.
December 1995 to Present

Executive Vice President, Law and Corporate Affairs, Meridian Oil Inc.,
July 1993 to Present; Senior Vice President, Law, Burlington Resources Inc.,
December 1993 to December 1995; Consultant, June 1991 to July 1993; Senior Vice
President, Law, Meridian Minerals Company, a subsidiary of Burlington Resources
Inc., November 1987 to June 1991.

9
<PAGE> 12

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, 1995, the number of common stockholders was
22,380.

Information on common stock prices and quarterly dividends is shown on page
32.

ITEM SIX

SELECTED FINANCIAL DATA

The selected financial data for the Company set forth below for the five
years ended December 31, 1995 should be read in conjunction with the
Consolidated Financial Statements.

<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
------ ------ ------ ------ ------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
CONTINUING OPERATIONS FOR THE YEAR ENDED:
Revenues.................................... $ 873 $1,055 $1,043 $ 943 $ 813
Operating Income (Loss)..................... (467) 175 256 240 177
Income (Loss)............................... (280) 154 256 190 100
Earnings (Loss) per Common Share(a)......... (2.20) 1.20 1.96 1.44 .75
Cash Dividends Declared per Common
Share(b)................................. .55 .55 .55 .60 .70
AT YEAR END:
Total Assets(c)............................. $4,165 $4,809 $4,448 $4,470 $5,480
Long-term Debt.............................. 1,350 1,309 819 1,003 1,298
Stockholders' Equity(c)..................... 2,220 2,568 2,608 2,406 2,907
Common Shares Outstanding................... 127 127 130 129 131
</TABLE>

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

(a) Excluding the non-cash charge related to the adoption of Statement of
Financial Accounting Standard No. 121, Accounting for the Impairment of
Long-lived Assets and for Long-lived Assets to Be Disposed Of ("SFAS No.
121") totaling $(2.39) per share, Earnings (Loss) per Common Share would
have been $.19 in 1995. Excluding non-recurring items totaling $.47, $.24,
and $.08 per share, Earnings (Loss) per Common Share would have been $1.49,
$1.20 and $.67 in 1993, 1992, and 1991, respectively.

(b) 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.

(c) In 1995, as a result of the impairment of oil and gas assets related to the
adoption of SFAS No. 121, the Company recognized a non-cash, pretax charge
of $490 million ($304 million after tax). 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.

10
<PAGE> 13

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, 1995 and 1994 was 38 and 34 percent,
respectively. In March 1995, the Company issued $150 million of 8.20% Notes due
March 15, 2025. The net proceeds were used for general corporate purposes,
including acquisition of oil and gas properties, repayment of commercial paper,
capital expenditures and repurchases of the Company's common stock.

The Company's credit facilities are comprised of a $600 million revolving
credit agreement that expires in July 2000 and a $300 million revolving credit
agreement that expires July 1996. The $300 million revolving credit agreement is
renewable annually by mutual consent and was renewed in July 1995. As of
December 31, 1995, there were no borrowings outstanding under the credit
facilities, although borrowing capacity is reduced by outstanding commercial
paper. At December 31, 1995, the Company had outstanding commercial paper
borrowings of $152 million at an average interest rate of 6.15 percent. The
Company had the capacity to borrow approximately $748 million under the credit
facilities at December 31, 1995. In addition, the Company has $350 million of
capacity under shelf registration statements filed with the Securities and
Exchange Commission.

During 1995, the Company repurchased 133 thousand shares of its common
stock for $5 million. Since December 1988, the Company has repurchased 27.3
million shares under three 10 million share repurchase authorizations.

Net cash provided by operating activities for 1995 was $452 million
compared to $498 million and $455 million in 1994 and 1993, respectively. The
decrease in 1995 compared to 1994 is primarily due to lower operating income
partially offset by $39 million received in June 1995 from the sale of a
receivable related to a claim resulting from the breach of a take-or-pay gas
contract and other working capital changes. The increase in 1994 compared to
1993 is primarily due to working capital changes partially offset by decreased
operating income.

The Company continues to divest marginal and non-strategic assets to
maintain its high quality asset base. During 1995, the Company divested over
4,300 working interest wells comprising approximately 14 percent of the
Company's working interest well inventory. In addition, the Company conveyed its
working interests in certain coal seam gas wells in August 1995. In February
1995, the Company completed the sale of its intrastate natural gas pipeline
systems and its underground natural gas storage facility, including gas
inventory, for approximately $80 million. The net proceeds after tax, from all
1995 asset divestitures were approximately $146 million. The Company expects to
continue divesting marginal and non-strategic assets in 1996.

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.

11
<PAGE> 14

CAPITAL EXPENDITURES AND RESOURCES

Capital expenditures during 1995 totaled $589 million compared to $882
million and $553 million in 1994 and 1993, respectively. The Company spent $104
million for producing property acquisitions in 1995 compared to $479 million and
$270 million in 1994 and 1993, respectively. The Company spent $443 million on
internal development and exploration during 1995 compared to $331 million and
$231 million in 1994 and 1993, respectively.

Capital expenditures for 1996, projected to be approximately $530 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, if 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, the East Coast and its
traditional California market.

MARKETING

DIVIDENDS

On January 10, 1996, the Board of Directors declared a common stock
quarterly dividend of $.1375 per share, payable April 1, 1996. 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 $70 million during 1995.

RESULTS OF OPERATIONS

Year Ended December 31, 1995 Compared With Year Ended December 31, 1994

The Company reported a net loss of $280 million or $2.20 per share in 1995
compared to net income of $154 million or $1.20 per share in 1994. The 1995
results include a $2.39 per share non-cash charge resulting from the Company's
adoption of Statement of Financial Accounting Standards No. 121, Accounting for
the Impairment of Long-lived Assets and for Long-lived Assets to Be Disposed Of
("SFAS No. 121").

Revenues were $873 million in 1995 compared to $1,055 million in 1994. Gas
sales volumes improved 11 percent to 1,165 MMCF per day and oil sales volumes
improved 5 percent to 48 MBbls per day which increased revenues $68 million and
$14 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. Average oil prices increased by 7 percent
to $16.69 per barrel which increased revenues by $18 million. The revenue
increases were more than offset by a 24 percent decline in 1995 average gas
sales prices to $1.25 per MCF which decreased revenues

12
<PAGE> 15

$170 million. Additionally, intrastate natural gas sales declined $96 million
due to the sale of the intrastate pipeline systems in February 1995 and other
revenues declined $9 million.

Costs and Expenses were $1,340 million in 1995 compared to $880 million in
1994. The increase was primarily due to a non-cash charge of $490 million
related to the impairment of oil and gas properties, a $38 million increase in
production related expenses and an $18 million increase in exploration costs.
The non-cash charge resulted from the Company's adoption of SFAS No. 121
effective as of September 30, 1995. The increases were partially offset by a $85
million reduction in intrastate natural gas purchases primarily due to the
February 1995 sale of the intrastate pipeline systems.

Interest Expense was $109 million in 1995 compared to $90 million in 1994.
The increase was primarily due to additional long-term debt issued in March 1995
and May 1994.

Other Income (Expense) -- Net was $700 thousand expense in 1995 compared to
$6 million income in 1994.

The effective income tax rate was a benefit of 52 percent in 1995 compared
to a benefit of 71 percent in 1994. The beneficial tax rate in 1995 is due to a
pretax loss and non-conventional fuel tax credits earned. The beneficial tax
rate in 1994 is due to low pretax income relative to the amount of
non-conventional fuel tax credits earned.

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

The Company reported net income in 1994 of $154 million or $1.20 per share
compared to $256 million or $1.96 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, 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.

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 $126 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.

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 credit earned.

13
<PAGE> 16

OTHER MATTERS

Effective September 30, 1995, the Company adopted SFAS No. 121 which
requires that long-lived assets held and used by an entity be reviewed for
impairment whenever events or changes indicate that the net book value of the
asset may not be recoverable. An impairment loss is recognized if the sum of
expected future cash flows from the use of the asset is less than the net book
value of the asset.

The primary change under SFAS No. 121 is that the Company will now evaluate
impairment of its oil and gas properties on a field-by-field basis rather than
in the aggregate. Based upon this evaluation, certain properties were deemed to
be impaired. For those properties, the Company adjusted the net book value of
the properties to their fair value based upon expected future discounted cash
flows. As a result of the Company's adoption of SFAS No. 121, combined with the
current weak gas market, the Company recognized a non-cash, pretax charge of
$490 million ($304 million after tax) related to its oil and gas properties.

In October 1995, the Financial Accounting Standards Board issued SFAS No.
123, Accounting for Stock-Based Compensation, which is effective for fiscal
years beginning after December 15, 1995.

SFAS No. 123 establishes financial accounting and reporting standards for
stock-based employee compensation plans. The pronouncement defines a fair value
based method of accounting for an employee stock option or similar equity
instrument and encourages all entities to adopt that method of accounting for
all of their employee stock compensation plans. However, it also allows an
entity to continue to measure compensation cost for those plans using the
intrinsic value based method of accounting prescribed by Accounting Principles
Board ("APB") Opinion No. 25, Accounting for Stock Issued to Employees. Entities
electing to continue using the accounting methods prescribed by APB Opinion No.
25 must make pro forma disclosures of net income and earnings per share as if
the fair value based method of accounting defined in SFAS No. 123 had been
applied. The Company is currently evaluating the impact SFAS No. 123 will have
on its financial position and results of operations and has not determined which
accounting method will be applied.

14
<PAGE> 17

ITEM EIGHT

FINANCIAL STATEMENTS AND SUPPLEMENTARY FINANCIAL INFORMATION

BURLINGTON RESOURCES INC.

CONSOLIDATED STATEMENT OF INCOME

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------
1995 1994 1993
---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C>
Revenues........................................... $ 872,514 $1,054,847 $1,043,232
Costs and Expenses................................. 1,339,740 879,810 787,427
---------- ---------- ----------
Operating Income (Loss)............................ (467,226) 175,037 255,805
Interest Expense................................... 108,865 90,291 72,799
Other Income (Expense) -- Net...................... (656) 5,523 125,570
---------- ---------- ----------
Income (Loss) Before Income Taxes.................. (576,747) 90,269 308,576
Income Tax Expense (Benefit)....................... (297,102) (63,977) 52,264
---------- ---------- ----------
Net Income (Loss).................................. $ (279,645) $ 154,246 $ 256,312
========== ========== ==========
Earnings (Loss) per Common Share................... $ (2.20) $ 1.20 $ 1.96
========== ========== ==========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

15
<PAGE> 18

BURLINGTON RESOURCES INC.

CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------
1995 1994
---------- ----------
(IN THOUSANDS)
<S> <C> <C>
ASSETS
Current Assets
Cash and Short-term Investments................................... $ 20,473 $ 19,898
Accounts Receivable............................................... 209,669 193,825
Inventories....................................................... 18,317 35,188
Other Current Assets.............................................. 16,528 17,191
---------- ----------
264,987 266,102
---------- ----------
Oil and Gas Properties (Successful Efforts Method).................. 5,870,344 5,689,135
Other Properties.................................................... 498,853 572,490
---------- ----------
6,369,197 6,261,625
Accumulated Depreciation, Depletion and Amortization.............. 2,602,014 1,904,212
---------- ----------
Properties -- Net.............................................. 3,767,183 4,357,413
---------- ----------
Other Assets........................................................ 132,590 185,095
---------- ----------
Total Assets.............................................. $4,164,760 $4,808,610
========== ==========
LIABILITIES
Current Liabilities
Accounts Payable.................................................. $ 213,598 $ 177,956
Taxes Payable..................................................... 59,055 47,080
Accrued Interest.................................................. 19,453 15,863
Dividends Payable................................................. 17,407 17,434
Other Current Liabilities......................................... 12,420 3,688
---------- ----------
321,933 262,021
---------- ----------
Long-term Debt...................................................... 1,350,319 1,309,137
---------- ----------
Deferred Income Taxes............................................... 110,075 480,648
---------- ----------
Other Liabilities and Deferred Credits.............................. 162,011 188,763
---------- ----------
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..................................................... 2,935,285 2,936,374
Retained Earnings................................................... 202,141 551,385
---------- ----------
3,138,926 3,489,259
Cost of Treasury Stock (1995, 23,425,621 Shares;
1994, 23,491,040 Shares).......................................... 918,504 921,218
---------- ----------
Common Stockholders' Equity......................................... 2,220,422 2,568,041
---------- ----------
Total Liabilities and Common Stockholders' Equity......... $4,164,760 $4,808,610
========== ==========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

16
<PAGE> 19

BURLINGTON RESOURCES INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1995 1994 1993
---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
Cash Flows From Operating Activities
Net Income (Loss)................................. $(279,645) $ 154,246 $ 255,174
Adjustments to Reconcile Net Income (Loss) to Net
Cash Provided By Operating Activities
Depreciation, Depletion and Amortization....... 372,602 337,421 285,258
Deferred Income Taxes.......................... (370,573) (86,118) 2,438
Exploration Costs.............................. 51,382 32,983 28,173
Impairment of Oil and Gas Properties........... 490,000 -- --
Working Capital Changes
Accounts Receivable.......................... (15,844) 24,536 17,294
Inventories.................................. 16,871 (11,234) (4,940)
Other Current Assets......................... 663 (2,619) 69,165
Accounts Payable............................. 35,642 (12,533) (24,649)
Taxes Payable................................ 11,975 (11,292) (1,761)
Accrued Interest............................. 3,590 3,787 (4,549)
Other Current Liabilities.................... 8,705 (17,558) (19,062)
Gain on Sales and Other........................... 126,630 86,632 (147,130)
--------- --------- ---------
Net Cash Provided By Operating
Activities.............................. 451,998 498,251 455,411
--------- --------- ---------
Cash Flows From Investing Activities
Additions to Properties........................... (588,795) (881,645) (553,384)
Proceeds from Sales and Other..................... 182,453 82,831 222,556
--------- --------- ---------
Net Cash Used In Investing Activities..... (406,342) (798,814) (330,828)
--------- --------- ---------
Cash Flows From Financing Activities
Proceeds from Long-term Financing................. 150,000 488,596 --
Reduction in Long-term Debt....................... (107,994) -- (183,610)
Dividends Paid.................................... (69,644) (71,010) (69,711)
Treasury Stock Transactions -- Net................ 2,714 (123,175) 30,999
Other............................................. (20,157) 6,266 85,794
--------- --------- ---------
Net Cash Provided By (Used In) Financing
Activities.............................. (45,081) 300,677 (136,528)
--------- --------- ---------
Increase (Decrease) in Cash and Short-term
Investments....................................... 575 114 (11,945)
Cash and Short-term Investments
Beginning of Year................................. 19,898 19,784 31,729
--------- --------- ---------
End of Year....................................... $ 20,473 $ 19,898 $ 19,784
========= ========= =========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

17
<PAGE> 20

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, 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 ($.55 per share)... (70,528) (70,528)
Stock Purchases (3,139,600
shares)........................ (122,007) (122,007)
Stock Option Activity and Other... (560) (1,168) (1,728)
------ ---------- -------- --------- ----------
Balance, December 31, 1994.......... 1,500 2,936,374 551,385 (921,218) 2,568,041
Net Loss.......................... (279,645) (279,645)
Cash Dividends ($.55 per share)... (69,599) (69,599)
Stock Purchases (132,900
shares)........................ (4,791) (4,791)
Stock Option Activity and Other... (1,089) 7,505 6,416
------ ---------- -------- --------- ----------
Balance, December 31, 1995.......... $1,500 $2,935,285 $202,141 $(918,504) $2,220,422
====== ========== ======== ========= ==========
</TABLE>

See accompanying Notes to Consolidated Financial Statements.

18
<PAGE> 21

BURLINGTON RESOURCES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES

Principles of Consolidation and Reporting

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. Due
to the nature of financial reporting, management makes estimates and assumptions
in preparing the consolidated financial statements. 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.

Prior to the adoption of Statement of Financial Accounting Standard No.
121, Accounting for the Impairment of Long-lived Assets and for Long-lived
Assets to be Disposed Of ("SFAS" No. 121") as of September 30, 1995, the Company
limited the total amount of unamortized capitalized costs to the aggregate value
of future net revenues, based on current prices and costs. Under SFAS No. 121,
the unamortized capital costs at a field level are reduced to fair value if the
sum of expected future cash flows generated is less than net book value.

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.

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 the Company's oil and gas
production. 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 also enters into gas swap agreements to hedge
oil or gas and from time to time to convert fixed price gas sales contracts to
market-sensitive contracts. Gains or losses resulting from these transactions
are recognized in the Company's Consolidated Statement of Income as the related
physical production is delivered.

19
<PAGE> 22

Credit and Market Risks

The Company manages and controls market and counterparty credit risk
through established formal internal control procedures which are reviewed on an
ongoing basis. The Company attempts to minimize credit-risk exposure to
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.

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 are earned.

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 127 million, 129 million, and 131 million for the years 1995,
1994, and 1993, 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 volumes of
third party oil, gas and NGLs marketed follow.

<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Oil (MBbls per day)..................................... 272 467 405
Gas (MMCF per day)...................................... 604 549 526
NGLs (MBbls per day).................................... 12 11 20
</TABLE>

Hedging and Related Transactions

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 Company enters into swap contracts to hedge
the Company's underlying production. Additionally, the Company utilizes swap
contracts as a risk management tool for fixed-price contracts entered into to
accommodate the needs of its customers, which results in the Company effectively
selling its production at market-sensitive prices.

In 1993, the Company entered into a gas swap agreement to offset the
effects of a long-term fixed-price contract of natural gas. When taking into
account the gas swap and the original fixed-price contract, the Company is a
fixed-price payor and receivor on substantially the same volume of gas at the
same price. The financial result is that there will be no gain or loss on these
transactions.

The Company is a fixed-price payor on approximately 4 BCF of gas at prices
ranging from $1.36 to $2.04 per MMBTU. These transactions convert fixed-price
contracts to market-sensitive contracts. The Company is a fixed-price receivor
on approximately 7 BCF of gas at prices ranging from $1.86 to $2.08 per MMBTU.
These transactions are a hedge of the Company's underlying production. The
deferred loss on these types of transactions as of December 31, 1995 was $5.2
million. This opportunity loss will be substantially offset in the cash market
when the hedged commodity is delivered in 1996, which has the effect of fixing
the price at which the commodity is sold.

20
<PAGE> 23

Futures Contracts Sold -- The Company sells oil and gas futures contracts
on the New York Mercantile Exchange ("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 crude oil positions outstanding as of December 31, 1995 totaled
740 MBbls (which approximates 4 percent of the Company's 1995 production) at
NYMEX prices ranging from $17.50 to $18.50 per Bbl for production through April
1996. The natural gas positions outstanding as of December 31, 1995 totaled 6
BCF (which approximates 1 percent of the Company's 1995 production) at NYMEX
prices ranging from $2.10 to $2.74 per MMBTU for production through March 1996.
The deferred loss on futures contracts as of December 31, 1995 was $5.9 million.
This opportunity loss will be substantially offset in the cash market when the
hedged commodity is delivered in 1996, which has the effect of fixing the price
at which the commodity is sold.

3. INCOME TAXES

The provision (benefit) for income taxes follows.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------
1995 1994 1993
--------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Current:
Federal............................................ $ 61,168 $ 23,320 $ 39,424
State.............................................. 12,303 (1,179) 10,402
-------- -------- --------
73,471 22,141 49,826
-------- -------- --------
Deferred:
Federal............................................ (331,286) (88,772) (14,934)
Enacted federal tax rate change.................... -- -- 15,558
State.............................................. (39,287) 2,654 1,814
-------- -------- --------
(370,573) (86,118) 2,438
-------- -------- --------
Total...................................... $(297,102) $(63,977) $ 52,264
======== ======== ========
</TABLE>

Reconciliation of the federal statutory income tax rate to the effective
income tax rate follows.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------
1995 1994 1993
----- ------ -----
<S> <C> <C> <C>
Statutory rate................................................. (35.0)% 35.0% 35.0%
State income taxes net of federal tax benefit.................. (3.0) 1.1 2.6
Tax credits.................................................... (14.5) (103.3) (25.0)
Enacted federal tax rate change................................ -- -- 5.1
Other.......................................................... 1.0 (3.7) (.8)
------ ------ -----
Effective rate....................................... (51.5)% (70.9)% 16.9%
====== ====== =====
</TABLE>

21
<PAGE> 24

Deferred tax liabilities (assets) follow.

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------
1995 1994
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
Deferred liabilities
Excess of book over tax basis of properties...................... $ 275,060 $ 600,253
Financial accruals and provisions................................ 15,861 30,769
--------- ---------
290,921 631,022
Deferred assets
AMT credits carryover............................................ (180,846) (150,374)
--------- ---------
Net deferred liability................................... $ 110,075 $ 480,648
========= =========
</TABLE>

The above net deferred tax liabilities as of December 31, 1995 and 1994,
include deferred state income tax liabilities of approximately $18 million and
$57 million, respectively.

As of December 31, 1995, the Alternative Minimum Tax ("AMT") credits
carryover of approximately $181 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 net income (loss) 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 follows.

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------
1995 1994
---------- ----------
(IN THOUSANDS)
<S> <C> <C>
Commercial Paper.................................................. $ 151,596 $ 259,590
Notes, 7.15%, due 1999............................................ 300,000 300,000
Debentures, 8.20%, due 2025....................................... 150,000 --
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................................. (1,277) (453)
---------- ----------
Total................................................... $1,350,319 $1,309,137
========== ==========
</TABLE>

Excluding commercial paper, the Company has debt maturities of $450 million
and $150 million due in 1999 and 2000, respectively. The Company's commercial
paper borrowings at December 31, 1995 had an average interest rate of 6.15
percent.

The Company's credit facilities are comprised of a $600 million revolving
credit agreement that expires in July 2000 and a $300 million revolving credit
agreement that expires July 1996. The $300 million revolving credit agreement is
renewable annually by mutual consent and was renewed in July 1995. 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, 1995, there were no borrowings outstanding under these credit
facilities although borrowing capacity is reduced by outstanding

22
<PAGE> 25

commercial paper. The Company had the capacity to borrow approximately $748
million under the credit facilities as of December 31, 1995. In addition, the
Company has $350 million of capacity under shelf registration statements filed
with the Securities and Exchange Commission.

5. TRANSPORTATION ARRANGEMENTS WITH EL PASO NATURAL GAS COMPANY

In 1995, 1994 and 1993, approximately 58 percent, 66 percent and 69
percent, respectively, of the Company's gas production was transported to direct
sale customers through El Paso Natural Gas Company ("EPNG") pipeline facilities.
These transportation arrangements are pursuant to EPNG's approved Federal Energy
Regulatory Commission tariffs applicable to all shippers. The Company expects to
continue to transport a substantial portion of its future gas production through
EPNG's pipeline system. See Note 8 for demand charges paid to EPNG which provide
the Company with firm and interruptible transportation capacity rights on
interstate and intrastate pipeline systems.

6. CAPITAL STOCK

The Company's 1993 Stock Incentive Plan (the "1993 Plan") succeeds the
Company's 1988 Stock Option 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 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
----------
Granted..................................................... 415,600 39.63 to 39.94
Exercised................................................... (177,365) 16.14 to 38.00
Cancelled................................................... (31,300) 33.88 to 38.00
----------
Balance, December 31, 1995.................................... 3,353,270 $ 21.54 to $47.56
==========
</TABLE>

At December 31, 1995, 2,943,670 options were exercisable at prices of
$21.54 to $47.56 per share. At December 31, 1995, 8,806,746 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

23
<PAGE> 26

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, 1995, there were 647,148
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, 1995 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
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.

7. 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,
----------------------
1995 1994
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Actuarial present value of benefit obligations
Accumulated benefit obligation, including vested
benefits of $101,084 and $85,599................................ $104,152 $ 88,060
======= =======
Projected benefit obligation for service to date................... $145,369 $116,839
Plan assets, primarily marketable equity and debt
securities, at fair value.......................................... (112,739) (92,935)
------- -------
Funded status of projected benefit obligation........................ 32,630 23,904
Unrecognized net loss................................................ (44,483) (34,712)
Unamortized net transition obligation................................ (3,456) (4,038)
------- -------
Net prepaid pension asset............................................ $(15,309) $(14,846)
======= =======
</TABLE>

24
<PAGE> 27

The following information relates to the consolidated Company plans.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------
1995 1994 1993
------- ------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Pension cost for the plans includes the following
components
Service cost -- benefits earned during the period........ $ 5,808 $ 6,633 $ 5,503
Interest cost on projected benefit obligation............ 9,311 9,395 8,926
Actual (return)/loss on plan assets...................... (17,864) 409 (7,857)
Net amortization and deferred amounts.................... 11,781 (4,640) 3,851
------- ------- -------
Net pension cost......................................... $ 9,036 $11,797 $ 10,423
======= ======= =======
</TABLE>

The projected benefit obligation was determined using a weighted average
discount rate of 7.50 percent in 1995 and 8.75 percent in 1994, 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 1995 and 1994.

8. 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.
The remaining terms on these contracts range in terms from 1 to 12 years and
require the Company to pay transportation demand charges regardless of the
amount of pipeline capacity utilized by the Company. The Company paid $56
million, $51 million and $48 million of demand charges of which $43 million, $40
million and $40 million was paid to EPNG for the years ended December 31, 1995,
1994 and 1993, respectively.

Future transportation demand charge commitments at December 31, 1995
follows.

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
--------------
(IN THOUSANDS)
<S> <C>
1996.......................................................... $ 58,211
1997.......................................................... 63,147
1998.......................................................... 56,669
1999.......................................................... 57,089
2000.......................................................... 42,596
Thereafter.................................................... 221,018
--------
Total.................................................... $498,730
========
</TABLE>

Lease Obligations

The Company has operating leases for office space and other property and
equipment. The Company incurred lease rental expense of $14 million, $17 million
and $13 million for the years ended December 31, 1995, 1994, and 1993,
respectively.

25
<PAGE> 28

Future minimum annual rental commitments at December 31, 1995 follow.

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
--------------
(IN THOUSANDS)
<S> <C>
1996.......................................................... $ 15,032
1997.......................................................... 13,667
1998.......................................................... 12,798
1999.......................................................... 9,643
2000.......................................................... 8,921
Thereafter.................................................... 78,644
--------
Total.................................................... $138,705
========
</TABLE>

Legal Proceedings

On May 25, 1995, the 270th Judicial District Court of Harris County, Texas
entered an order in a lawsuit styled Caroline Altheide, et al. v. Meridian Oil
Inc., et al. which allows the suit to be maintained as a class action on behalf
of all royalty and overriding royalty interest owners in all Meridian properties
and all working interest owners in properties operated by Meridian who have
received payments from Meridian at any time from and after December 1, 1986
based upon wellhead sales of natural gas to Meridian Oil Trading Inc. The
lawsuit involves claims for unspecified actual and punitive damages based upon
alleged breaches of duties owed to interest owners because of the use of
Meridian corporate affiliates to gather, treat and market natural gas. The
plaintiffs allege that Meridian's gas producing affiliates have sold natural gas
to marketing affiliates at low inter-affiliate settlement prices which are then
used as the basis for accounting to interest owners. Plaintiffs also allege that
Meridian's pricing includes inappropriate deductions of inflated gathering and
transportation costs. Meridian is vigorously defending this litigation and
perfected an interlocutory appeal of the class certification order on May 30,
1995. This appeal effectively stays class action proceedings in the trial court
until the appeal is completed. Oral argument in this appeal has been set for
February 28, 1996.

9. IMPAIRMENT OF OIL AND GAS PROPERTIES

26
<PAGE> 29

10. STOCK-BASED COMPENSATION

In October 1995, the Financial Accounting Standards Board issued SFAS No.
123, Accounting for Stock-Based Compensation, which is effective for fiscal
years beginning after December 15, 1995.

SFAS No. 123 establishes financial accounting and reporting standards for
stock-based employee compensation plans. The pronouncement defines a fair value
based method of accounting for an employee stock option or similar equity
instrument and encourages all entities to adopt that method of accounting for
all of their employee stock compensation plans. However, it also allows an
entity to continue to measure compensation cost for those plans using the
intrinsic value based method of accounting prescribed by Accounting Principles
Board ("APB") Opinion No. 25, Accounting for Stock Issued to Employees. Entities
electing to remain with the accounting in APB Opinion No. 25 must make pro forma
disclosures of net income and earnings per share as if the fair value based
method of accounting defined in SFAS No. 123 had been applied. The Company is
currently evaluating the impact SFAS No. 123 will have on its financial position
and results of operations and has not determined which accounting method will be
applied.

11. OTHER INFORMATION

Other Income (Expense) -- Net

During 1995 and 1994, there were no single significant items included in
Other Income (Expense)--Net. A summary of significant items included in Other
Income (Expense) -- Net in 1993 follows.

<TABLE>
<S> <C>
Gain on sale of Trust units....................................... $107,800
Gain on conversion of debt........................................ 19,108
Other -- net...................................................... (1,338)
--------
$125,570
========
</TABLE>

Supplemental Cash Flow Information

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

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1995 1994 1993
-------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Interest Paid................................ $104,379 $85,599 $77,351
Income Taxes Paid--Net....................... 60,518 40,966 39,948
</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.

27
<PAGE> 30

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, 1995 and 1994, 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, 1995. 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, 1995 and 1994, and the consolidated results of
its operations and its cash flows for each of the three years in the period
ended December 31, 1995, in conformity with generally accepted accounting
principles.

As discussed in Note 9 to the consolidated financial statements, the
Company changed its method of accounting for the impairment of long-lived assets
in 1995.

/s/ COOPERS & LYBRAND L.L.P.
Houston, Texas
January 10, 1996

28
<PAGE> 31

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 follow.

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------
1995 1994
---------- ----------
(IN THOUSANDS)
<S> <C> <C>
Proved properties............................................... $5,830,201 $5,671,033
Unproved properties............................................. 40,143 18,102
---------- ----------
5,870,344 5,689,135
Accumulated depreciation, depletion and amortization............ 2,410,428 1,714,098
---------- ----------
Net capitalized costs................................. $3,459,916 $3,975,037
========= =========
</TABLE>

Costs incurred for oil and gas property acquisition, exploration and
development activities follow.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------
1995 1994 1993
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Property acquisition
Unproved................................................. $ 38,348 $ 21,679 $ 10,816
Proved................................................... 104,115 479,466 270,235
Exploration................................................ 80,339 30,978 17,159
Development................................................ 324,311 278,343 202,981
--------- --------- ---------
Total costs incurred............................. $ 547,113 $ 810,466 $ 501,191
======== ======== ========
</TABLE>

Results of operations for oil and gas producing activities follow.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------
1995 1994 1993
--------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Net revenues............................................. $ 826,190 $905,465 $897,927
--------- -------- --------
Production costs......................................... 269,710 261,453 240,220
Exploration and impairment costs......................... 51,382 32,983 28,173
Operating expenses....................................... 154,319 145,649 135,550
Depreciation, depletion and amortization................. 331,600 299,763 248,505
Impairment of oil and gas properties..................... 490,000 -- --
--------- -------- --------
1,297,011 739,848 652,448
--------- -------- --------
Operating income (loss).................................. (470,821) 165,617 245,479
Income tax provision..................................... (260,873) (38,799) 26,582
--------- -------- --------
Results of operations for oil and gas producing
activities............................................. $(209,948) $204,416 $218,897
========= ======== ========
</TABLE>

29
<PAGE> 32

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, 1993......................................................... 155.5 5,071
Revision of previous estimates....................................... (.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)........................................ (.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
Revision of previous estimates....................................... 1.5 (33)
Extensions, discoveries and other additions.......................... 23.4 533
Production........................................................... (17.5) (425)
Purchases of reserves in place....................................... 9.3 131
Sales of reserves in place(e)........................................ (3.9) (200)
----- -----
December 31, 1995....................................................... 196.9 5,507
===== =====
PROVED DEVELOPED RESERVES
January 1, 1993......................................................... 141.8 4,204
December 31, 1993....................................................... 149.8 4,381
December 31, 1994....................................................... 161.9 4,584
December 31, 1995....................................................... 168.1 4,543
</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.

(e) Includes the reserves associated with the August 1995 conveyance of working
interests in coal seam gas wells.

30
<PAGE> 33

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>
DECEMBER 31,
---------------------------
1995 1994
----------- -----------
(IN THOUSANDS)
<S> <C> <C>
Future cash inflows.............................................. $11,609,000 $11,628,000
Less related future
Production costs............................................ 3,451,000 3,505,000
Development costs........................................... 529,000 466,000
Income taxes................................................ 1,401,000 1,320,000
----------- -----------
Future net cash flows.................................. 6,228,000 6,337,000
10% annual discount for estimated timing of cash flows......... 3,044,000 3,339,000
----------- -----------
Standardized measure of discounted future net cash flows.... $ 3,184,000 $ 2,998,000
=========== ===========
</TABLE>

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

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1995 1994 1993
---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
January 1.............................................. $2,998,000 $3,124,000 $3,138,000
---------- ---------- ----------
Revisions of previous estimates
Changes in prices and costs.......................... (33,000) (350,000) (208,000)
Changes in quantities................................ (22,000) (20,000) 9,000
Changes in rate of production........................ 189,000 129,000 (105,000)
Additions to proved reserves resulting from extensions,
discoveries and improved recovery, less related
costs................................................ 250,000 195,000 180,000
Purchases of reserves in place......................... 99,000 251,000 260,000
Sales of reserves in place............................. (124,000) (67,000) (107,000)
Accretion of discount.................................. 358,000 363,000 375,000
Sales of oil and gas, net of production costs.......... (556,000) (644,000) (578,000)
Net change in income taxes............................. 11,000 (80,000) 91,000
Other.................................................. 14,000 97,000 69,000
---------- ---------- ----------
Net change............................................. 186,000 (126,000) (14,000)
---------- ---------- ----------
December 31............................................ $3,184,000 $2,998,000 $3,124,000
========== ========== ==========
</TABLE>

31
<PAGE> 34

BURLINGTON RESOURCES INC.

QUARTERLY FINANCIAL DATA--UNAUDITED

<TABLE>
<CAPTION>
1995 1994
-------------------------------------- -------------------------------------
4TH 3RD 2ND 1ST 4TH 3RD 2ND 1ST
------- ------ ------ ------- ------- ------- ------ -------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues........................ $ 237 $ 210 $ 211 $ 215 $ 241 $ 273 $ 266 $ 275
Operating Income (Loss)(b)...... $ 20 $ (489) $ -- $ 2 $ 21 $ 39 $ 46 $ 69
Net Income (Loss)(a)............ $ 23 $ (300) $ 2 $ (5) $ 52 $ 21 $ 33 $ 48
Earnings (Loss) per Common
Share......................... $ .18 $(2.36) $ .02 $ (.04) $ .42 $ .16 $ .25 $ .37
Dividends Declared per Common
Share......................... $ .1375 $.1375 $.1375 $ .1375 $ .1375 $ .1375 $.1375 $ .1375
Common Stock Price Range:
High.......................... 41 1/4 42 41 1/2 40 3/4 42 5/8 41 7/8 45 5/8 49 5/8
Low........................... 35 1/8 36 7/8 36 3/4 33 7/8 33 1/8 37 1/4 40 7/8 41 1/2
</TABLE>

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

(a) The beneficial effective tax rates for the fourth quarters of 1995 and 1994
are primarily due to non-conventional fuel tax credits earned. The 1994
benefit included increased tax credits due to higher taxable income
resulting from additional tax gains in the fourth quarter of 1994.

(b) In 1995, as a result of the Company's adoption of SFAS No. 121, the Company
recognized a non-cash, pretax charge of $490 million.

32
<PAGE> 35

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 1996 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 9 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 1996 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 1996 Annual Meeting of Stockholders and is
incorporated herein by reference.

33
<PAGE> 36

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................................................. 15
Consolidated Balance Sheet....................................................... 16
Consolidated Statement of Cash Flows............................................. 17
Consolidated Statement of Common Stockholders' Equity............................ 18
Notes to Consolidated Financial Statements....................................... 19
Report of Independent Accountants................................................ 28
Supplemental Oil and Gas Disclosures -- Unaudited................................ 29
Quarterly Financial Data -- Unaudited............................................ 32
AMENDED EXHIBIT INDEX.............................................................. *
</TABLE>

REPORTS ON FORM 8-K

The Company filed a Form 8-K dated March 21, 1995, which included as
an exhibit the form of underwriting agreement in connection with its
offering of $150 million of 8.20% Debentures due 2025.
- ---------------

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

34
<PAGE> 37

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 BOBBY S. SHACKOULS
-----------------------------------
Bobby S. Shackouls
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 BOBBY S. SHACKOULS President and Chief January 10, 1996
------------------------------- Executive Officer, and
Bobby S. Shackouls Director

JOHN E. HAGALE Executive Vice President and January 10, 1996
------------------------------- Chief Financial Officer
John E. Hagale

HAYS R. WARDEN Vice President, Controller January 10, 1996
------------------------------- and Chief Accounting Officer
Hays R. Warden

THOMAS H. O'LEARY Chairman of the Board January 10, 1996
-------------------------------
Thomas H. O'Leary

JOHN V. BYRNE Director January 10, 1996
-------------------------------
John V. Byrne

S. PARKER GILBERT Director January 10, 1996
-------------------------------
S. Parker Gilbert

JAMES F. McDONALD Director January 10, 1996
-------------------------------
James F. McDonald

DONALD M. ROBERTS Director January 10, 1996
-------------------------------
Donald M. Roberts

WALTER SCOTT, JR. Director January 10, 1996
-------------------------------
Walter Scott, Jr.

WILLIAM E. WALL Director January 10, 1996
-------------------------------
William E. Wall
</TABLE>

35
<PAGE> 38

REPORT OF MANAGEMENT

To the Stockholders and Directors of Burlington Resources Inc.:

The accompanying financial statements have been prepared by management in
conformity with generally accepted accounting principles. The fairness and
integrity of these financial statements, including any judgments, estimates and
selection of appropriate generally accepted accounting principles, are the
responsibility of management, as is all other information presented in this
Annual Report.

In the opinion of management, the financial statements are fairly stated,
and, to that end, the Company maintains a system of internal controls which:
provides reasonable assurance that transactions are recorded properly for the
preparation of financial statements; safeguards assets against loss or
unauthorized use; maintains accountability for assets; and requires proper
authorization and accounting for all transactions. Management is responsible for
the effectiveness of internal controls. This is accomplished through established
codes of conduct, accounting and other control systems, policies and procedures,
employee selection and training, appropriate delegation of authority and
segregation of responsibilities. To further ensure compliance with established
standards and related control procedures, the Company conducts a substantial
corporate audit program.

Our independent certified public accountants provide an objective
independent review by their audit of the Company's financial statements. Their
audit is conducted in accordance with generally accepted auditing standards and
includes a review of internal accounting controls to the extent deemed necessary
for the purposes of their audit.

The Audit Committee of the Board of Directors meets regularly with the
independent certified public accountants, management, and corporate audit to
review the work of each and to ensure that each is properly discharging its
financial reporting and internal control responsibilities. To ensure complete
independence, the certified public accountants and corporate audit have full and
free access to the Audit Committee to discuss the results of their audits, the
adequacy of internal accounting controls and the quality of financial reporting.

January 10, 1996

/s/ John E. Hagale
-----------------------------
John E. Hagale
Executive Vice President and
Chief Financial Officer

/s/ Hays R. Warden
-----------------------------
Hays R. Warden
Vice President, Controller and
Chief Accounting Officer

36
<PAGE> 39

UNDERTAKINGS

For the purposes of complying with the amendments to the rules governing
Form S-8 (effective July 13, 1990) under the Securities Act of 1933, the
registrant hereby undertakes as follows, which undertaking shall be incorporated
by reference into the registrant's Registration Statements on Form S-8, Nos.
33-22493 (filed June 15, 1988), 33-25807 (filed December 1, 1988), 33-26024
(filed December 12, 1988), 2-97533 (filed December 29, 1989), 33-33626 (filed
March 1, 1990), 33-46518 (filed March 19, 1992) and 33-53973 (filed June 3,
1994):

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
<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...........................
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 and
restated October 1, 1994 (Exhibit 10.3 to Form 10-K, filed February
1995)..................................................................... *
10.3 Burlington Resources Inc. Senior Executive Survivor Benefit Plan dated as
of January 1, 1989 (Exhibit 10.11 to Form 8, filed February 1989)......... *
10.4 Burlington Resources Inc. Deferred Compensation Plan as amended and
restated October 1, 1994 (Exhibit 10.6 to Form 10-K, filed February
1995)..................................................................... *
10.5 Burlington Resources Inc. Supplemental Benefits Plan as amended and
restated October 1, 1994 (Exhibit 10.8 to Form 10-K, filed February
1995)..................................................................... *
10.6 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)............. *
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)........ *
Amendment to Employment Contract between Burlington Resources Inc. and
Thomas H. O'Leary (Exhibit 10.10 to Form 10-K, filed February 1995)....... *
Amendment to Employment Contract between Burlington Resources Inc. and
Thomas H. O'Leary.........................................................
10.7 Employment Contract between Burlington Resources Inc. and Bobby S.
Shackouls.................................................................
</TABLE>

A-1
<PAGE> 41

<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------- -------------------------------------------------------------------------- ------
<S> <C> <C>
10.8 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)......... *
10.9 Burlington Resources Inc. Key Executive Severance Protection Plan as
amended June 8, 1989 (Exhibit 10.20 to Form 8, filed February 1992)....... *
10.10 Burlington Resources Inc. Retirement Savings Plan (Exhibits to Form S-8,
No. 2-97533, filed December 1989)......................................... *
Amendment No. 1 to Burlington Resources Inc. Retirement Savings Plan (Ex-
hibit 10.15 to Form 8, filed March 1993).................................. *
Amendment No. 2 to Burlington Resources Inc. Retirement Savings Plan (Ex-
hibit 10.21 to Form 8, filed February 1992)............................... *
Amendment No. 3 to Burlington Resources Inc. Retirement Savings Plan (Ex-
hibit 10.15 to Form 8, filed March 1993).................................. *
Amendment No. 4 to Burlington Resources Inc. Retirement Savings Plan......
10.11 Burlington Resources Inc. Retirement Income Plan for Directors (Exhibit
10.21 to Form 8, filed February 1991)..................................... *
10.12 Burlington Resources Inc. Phantom Stock Plan for Non-Employee Directors,
Effective March 21, 1996..................................................
10.13 Burlington Resources Inc. 1991 Director Charitable Award Plan, dated as of
January 16, 1991 (Exhibit 10.22 to Form 8, filed February 1991)........... *
10.14 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)........................................... *
10.15 Burlington Resources Inc. 1992 Stock Option Plan for Non-employee
Directors (Exhibit 28.1 of Form S-8, No. 33-46518, filed March 1992)...... *
10.16 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).......... *
10.17 Burlington Resources Inc. 1992 Performance Share Unit Plan (Exhibit 10.21
to Form 8, filed March 1993).............................................. *
10.18 Burlington Resources Inc. Severance Plan and Amendments No. 1 and 2 (Ex-
hibit 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)......................... *
10.19 Burlington Resources Inc. 1993 Stock Incentive Plan (Exhibit 10.22 to Form
10-K, filed February 1994)................................................ *
10.20 Petrotech Long Term Incentive Plan (Exhibit 10.22 to Form 10-K, filed
February 1995)............................................................ *
10.21 Burlington Resources Inc. 1994 Restricted Stock Exchange Plan (Exhibit
10.23 to Form 10-K, filed February 1995).................................. *
</TABLE>

A-2
<PAGE> 42

<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------- ------
<S> <C> <C>
10.22 $300 million Short-term Revolving Credit Agreement, dated as of July 20,
1994, between Burlington Resources Inc. and Citibank, N.A., as agent
(Exhibit 10.24 to Form 10-K, filed February 1995)......................... *
10.23 Amended and Restated $600 million Long-term Revolving Credit Agreement,
dated as of July 14, 1995, between Burlington Resources Inc. and Citibank,
N.A. as agent.............................................................
11.1 Earnings (Loss) Per Share.................................................
12.1 Ratio of Earnings to Fixed Charges........................................
21.1 Subsidiaries of the Registrant............................................
23.1 Consent of Independent Accountants........................................
27.1 Financial Data Schedule................................................... **
</TABLE>

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

*Exhibit incorporated by reference as indicated.

**Exhibit required only for filings made electronically using the Securities and
Exchange Commission's EDGAR System.

A-3

<PAGE> 1
EXHIBIT 3.2

BY-LAWS

BURLINGTON RESOURCES INC.

AS AMENDED THROUGH DECEMBER 6, 1995
<PAGE> 2
BY-LAWS

BURLINGTON RESOURCES INC

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE I OFFICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Section 1 Registered Office and Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2 Other Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Section 1 Annual Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2 Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 3 Place of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 4 Notice of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 5 Fixing of Record Date for Determining Stockholders . . . . . . . . . . . . . . . . 2
Section 6 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 7 Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 8 Voting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 9 Inspectors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 10 List of Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

ARTICLE III BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Section 1 Number, Qualification and Term of Office . . . . . . . . . . . . . . . . . . . . . 5
Section 2 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 3 Resignations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 4 Removals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 5 Place of Meetings; Books and Records . . . . . . . . . . . . . . . . . . . . . . . 6
Section 6 Annual Meeting of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 7 Regular Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 8 Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 9 Quorum and Manner of Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 10 Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 11 Consent of Directors in Lieu of Meeting . . . . . . . . . . . . . . . . . . . . . 7
Section 12 Telephonic Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 13 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
</TABLE>

-i-
<PAGE> 3

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE IV COMMITTEES OF THE BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Section 1 Executive Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2 Finance Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 3 Audit Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 4 Compensation and Nominating Committee . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5 Committee Chairman, Books and Records . . . . . . . . . . . . . . . . . . . . . . . 10
Section 6 Alternates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 7 Other Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 8 Quorum and Manner of Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

ARTICLE V OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Section 1 Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2 Election, Term of Office and Qualifications . . . . . . . . . . . . . . . . . . . . 11
Section 3 Resignations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 4 Removals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 5 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 6 Compensation of Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 7 Chairman of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 8 President and Chief Executive Officer . . . . . . . . . . . . . . . . . . . . . . . 12
Section 9 Executive Vice President and Chief Financial Officer . . . . . . . . . . . . . . . 13
Section 10 Executive Vice President, Law . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 11 Secretary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 12 Treasurer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 13 Absence or Disability of Officers . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE VI STOCK CERTIFICATES AND TRANSFER THEREOF . . . . . . . . . . . . . . . . . . . . . . . . . 15

Section 1 Stock Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 2 Transfer of Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3 Transfer Agent and Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4 Additional Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5 Lost, Destroyed or Mutilated Certificates . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE VII DIVIDENDS, SURPLUS, ETC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE VIII SEAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE IX FISCAL YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Section 1 Right to Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 2 Right of Indemnitee to Bring Suit . . . . . . . . . . . . . . . . . . . . . . . . . 18
</TABLE>

-ii-
<PAGE> 4

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 3 Nonexclusivity of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 4 Insurance, Contracts and Funding . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 5 Definition of Director and Officer . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 6 Indemnification of Employees and Agents of the Corporation . . . . . . . . . . . . 19

ARTICLE XI CHECKS, DRAFTS, BANK ACCOUNTS, ETC . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Section 1 Checks, Drafts, Etc.; Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 2 Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

ARTICLE XII AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
</TABLE>

-iii-
<PAGE> 5
BY-LAWS

BURLINGTON RESOURCES INC.

ARTICLE I

OFFICES

SECTION 1. REGISTERED OFFICE AND AGENT.

The registered office of the corporation is located at Corporation
Trust Center, 1209 Orange Street in the City of Wilmington, County of New
Castle, State of Delaware, and the name of its registered agent at such address
is The Corporation Trust Company.

SECTION 2. OTHER OFFICES.

The corporation may have offices at such other places both within and
without the State of Delaware as the Board of Directors may from time to time
determine or the business of the corporation may require.

ARTICLE II

STOCKHOLDERS

SECTION 1. ANNUAL MEETINGS.

A meeting of the stockholders for the purpose of electing directors
and for the transaction of such other business as may properly be brought
before the meeting shall be held annually at ten (10) o'clock A.M. on the
third Thursday of April, or at such other time on such other day as shall be
fixed by resolution of the Board of Directors. If the day fixed for the annual
meeting shall be a legal holiday such meeting shall be held on the next
succeeding business day.

SECTION 2. SPECIAL MEETINGS.

Special meetings of the stockholders for any purpose or purposes may
be called only by a majority of the Board of Directors, the Chairman of the
Board, or the President. (Amended February 22, 1989)

1
<PAGE> 6

SECTION 3. PLACE OF MEETINGS.

The annual meeting of the stockholders of the corporation shall be
held at the general offices of the corporation in the City of Houston, State of
Texas, or at such other place in the United States as may be stated in the
notice of the meeting. All other meetings of the stockholders shall be held at
such places within or without the State of Delaware as shall be stated in the
notice of the meeting. (Amended December 6, 1995)

SECTION 4. NOTICE OF MEETINGS.

4.1 Giving of Notice. Except as otherwise provided by statute,
written notice of each meeting of the stockholders, whether annual or special,
shall be given not less than ten nor more than sixty days before the date of
the meeting to each stockholder entitled to vote at such meeting. If mailed,
notice shall be given when deposited in the United States mails, postage
prepaid, directed to such stockholder at his address as it appears in the stock
ledger of the corporation. Each such notice shall state the place, date and
hour of the meeting, and, in the case of a special meeting, the purpose or
purposes for which the meeting is called.

4.2 Notice of Adjourned Meetings. When a meeting is adjourned to
another time and place, notice of the adjourned meeting need not be given if
the time and place thereof are announced at the meeting at which the
adjournment is given. If the adjournment is for more than thirty days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.

4.3 Waiver of Notice.

4.3.1 Whenever any notice is required to be given to any stockholder
under the provisions of these By-Laws, the Certificate of Incorporation or the
General Corporation Law of Delaware, a waiver thereof in writing, signed by the
person or persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.

4.3.2 The attendance of a stockholder at a meeting shall constitute a
waiver of notice of such meeting, except when a stockholder attends a meeting
for the express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened.

SECTION5. FIXING OF RECORD DATE FOR DETERMINING STOCKHOLDERS.

5.1 Meetings. For the purpose of determining stockholders entitled
to notice of or to vote at any meeting of stockholders or any adjournment
thereof, the Board may fix a record date, which record date shall not precede
the date upon which the resolution fixing the record date is adopted by
the Board, and which record date shall not be more than sixty nor less than ten
days before the date of such meeting. If no record date is fixed by the Board,
the record date for

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determining stockholders shall be at the close of business on the day next
preceding the day on which notice is given, or, if notice is waived, at the
close of business on the day next preceding the day on which the meeting is
held. A determination of stockholders of record entitled to notice of or to
vote at the meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board may fix a new record date for the
adjourned meeting.

5.2 Dividends, Distributions and Other Rights. For the purpose of
determining stockholders entitled to receive payment of any dividend or other
distribution or allotment of any rights or the stockholders entitled to
exercise any rights in respect of any change, conversion or exchange of stock,
or for the purpose of any other lawful action, the Board may fix a record date,
which record date shall not precede the date upon which the resolution fixing
the record date is adopted, and which record date shall be not more than sixty
days prior to such action. If no record date is fixed, the record date for
determining stockholders for any such purpose shall be at the close of business
on the day on which the Board adopts the resolution relating thereto.

SECTION 6. QUORUM.

A majority of the outstanding shares of stock of the corporation
entitled to vote, present in person or represented by proxy, shall constitute a
quorum at a meeting of the stockholders; provided that where a separate vote by
a class or classes or by a series of a class is required, a majority of the
outstanding shares of such class or classes or of such series of a class,
present in person or represented by proxy at the meeting, shall constitute a
quorum entitled to take action with respect to the vote on that matter. If
less than a majority of the outstanding shares entitled to vote are represented
at a meeting, a majority of the shares so represented may adjourn the meeting
from time to time without further notice. If a quorum is present or
represented at a reconvened meeting following such an adjournment, any business
may be transacted that might have been transacted at the meeting as originally
called. The stockholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
stockholders to leave less than a quorum.

SECTION 7. ORGANIZATION.

At each meeting of the stockholders, the Chairman of the Board, or in
his absence such person as shall have been designated by the Board of
Directors, or in the absence of such designation a person elected by the
holders of a majority in number of shares of stock present in person or
represented by proxy and entitled to vote, shall act as Chairman of the
meeting.

The Secretary, or in his absence or in the event he shall be presiding
over the meeting in accordance with the provisions of this Section, an
Assistant Secretary or, in the absence of the 4 Secretary and all of the
Assistant Secretaries, any person appointed by the Chairman of the meeting,
shall act as Secretary of the meeting.

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SECTION 8. VOTING.

8.1 Generally. Unless otherwise provided in the Certificate of
Incorporation or a resolution of the Board of Directors creating a series of
stock, at each meeting of the stockholders, each holder of shares of any series
or class of stock entitled to vote at such meeting shall be entitled to one
vote for each share of stock having voting power in respect of each matter upon
which a vote is to be taken, standing in his name on the stock ledger of the
corporation on the record date fixed as provided in these By-Laws for
determining the stockholders entitled to vote at such meeting. In all matters
other than the election of Directors, if a quorum is present, the affirmative
vote of the majority of the shares present in person or represented by proxy at
the meeting and entitled to vote on the subject matter shall be the act of the
stockholders, unless the vote of a greater number is required by these By-Laws,
the Certificate of Incorporation or the General Corporation Law of Delaware.
Where a separate vote by a class or classes or by a series of a class is
required, if a quorum is present, the affirmative vote of the majority of
shares of such class or classes or series of a class present in person or
represented by proxy at the meeting shall be the act of such class or classes
or series of a class.

8.2 Voting for Directors. At each election of Directors the voting
shall be by ballot. Directors shall be elected by a plurality of the votes of
the shares present in person or represented by proxy at the meeting and
entitled to vote on the election of Directors.

8.3 Shares Held or Controlled by the Corporation. Shares of its own
capital stock belonging to the corporation, or to another corporation if a
majority of the shares entitled to vote in the election of directors of such
other corporation is held by the corporation, shall neither be entitled to vote
nor counted for quorum purposes.

8.4 Proxies. A stockholder may vote by proxy executed in writing by
the stockholder or by his attorney-in-fact. Such proxy shall be filed with
the Secretary of the corporation before or at the time of the meeting. A proxy
shall become invalid three years after the date of its execution, unless
otherwise provided in the proxy. A proxy with respect to a specified meeting
shall entitle the holder thereof to vote at any reconvened meeting following
adjournment of such meeting but shall not be valid after the final adjournment
thereof.

SECTION 9. INSPECTORS.

Prior to each meeting of stockholders, the Board of Directors shall
appoint two Inspectors who are not directors, candidates for directors or
officers of the corporation, who shall receive and determine the validity of
proxies and the qualifications of voters, and receive, inspect, count and
report to the meeting in writing the votes cast on all matters submitted to a
vote at such meeting. In case of failure of the Board of Directors to make such
appointments or in case of failure of any Inspector so appointed to act, the
Chairman of the Board shall make such appointment or fill such vacancies. Each
Inspector, immediately before entering upon his duties, shall subscribe to an
oath or affirmation faithfully to execute the duties of Inspector at such
meeting with strict impartiality and according to the best of his ability.

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<PAGE> 9

SECTION 10. LIST OF STOCKHOLDERS.

The Secretary or other officer or agent having charge of the stock
ledger of the corporation shall prepare and make, at least ten days before
every meeting of stockholders, a complete list of the stockholders entitled to
vote at said meeting, arranged in alphabetical order and showing the address of
each stockholder and the number of shares of each class and series registered
in the name of each such stockholder. Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during
ordinary business hours, for a period of at least ten days prior to the
meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. Such list shall also
be produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present. The stock
ledger shall be the only evidence as to who are the stockholders entitled to
examine the stock ledger, the list required by this section, or the books of
the corporation, or to vote in person or by proxy at any such meeting.

ARTICLE III

BOARD OF DIRECTORS

SECTION 1. NUMBER, QUALIFICATION AND TERM OF OFFICE.

The business, property and affairs of the corporation shall be managed
by a Board consisting of not less than one Director. The Board of Directors
shall from time to time by a vote of a majority of the Directors then in office
fix the specific number of Directors to constitute the Board. At each annual
meeting of stockholders a Board of Directors shall be elected by the
stockholders for a term of one year. Each Director shall serve until his
successor is elected and shall qualify.

SECTION 2. VACANCIES.

Vacancies in the Board of Directors and newly created directorships
resulting from any increase in the authorized number of Directors may be filled
by a majority of the Directors then in office, although less than a quorum, or
by a sole remaining Director, at any regular or special meeting of the Board of
Directors.

SECTION 3. RESIGNATIONS.

Any Director may resign at any time upon written notice to the
Secretary of the corporation. Such resignation shall take effect on the date
of receipt of such notice or at any later date specified therein; and the
acceptance of such resignation, unless required by the terms thereof, shall not
be necessary to make it effective. When one or more Directors shall resign
effective at a future date, a majority of the Directors then in office,
including those who have

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<PAGE> 10

resigned, shall have power to fill such vacancy or vacancies to take effect
when such resignation or resignations shall become effective.

SECTION 4. REMOVALS.

Any Director may be removed, with cause, at any special meeting of the
stockholders called for that purpose, by the affirmative vote of the holders of
a majority in number of shares of the corporation entitled to vote for the
election of such Director, and the vacancy in the Board caused by any such
removal may be filled by the stockholders at such a meeting.

SECTION 5. PLACE OF MEETINGS; BOOKS AND RECORDS.

The Board of Directors may hold its meetings, and have an office or
offices, at such place or places within or without the State of Delaware as the
Board from time to time may determine.

The Board of Directors, subject to the provisions of applicable
statutes, may authorize the books and records of the corporation, and offices
or agencies for the issue, transfer and registration of the capital stock of
the corporation, to be kept at such place or places outside of the State of
Delaware as, from time to time, may be designated by the Board of Directors.

SECTION 6. ANNUAL MEETING OF THE BOARD.

The first meeting of each newly elected Board of Directors, to be
known as the Annual Meeting of the Board, for the purpose of electing officers,
designating committees and the transaction of such other business as may come
before the Board, shall be held as soon as practicable after the adjournment of
the annual meeting of stockholders, and no notice of such meeting shall be
necessary to the newly elected Directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event such meeting is not
held due to the absence of a quorum, the 8 meeting may be held at such time and
place as shall be specified in a notice given as hereinafter provided for
special meetings of the Board of Directors, or as shall be specified in a
written waiver signed by all of the newly elected Directors.

SECTION 7. REGULAR MEETINGS.

The Board of Directors shall, by resolution, provide for regular
meetings of the Board at such times and at such places as it deems desirable.
Notice of regular meetings need not be given.

SECTION 8. SPECIAL MEETINGS.

Special meetings of the Board of Directors may be called by the
Chairman of the Board or the President and shall be called by the Secretary on
the written request of three Directors on such notice as the person or persons
calling the meeting shall deem appropriate in the circumstances. Notice of
each such special meeting shall be mailed to each Director or delivered to him
by telephone, telegraph or any other means of electronic communication, in each
case

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addressed to his residence or usual place of business, or delivered to him
in person or given to him orally. The notice of meeting shall state the time
and place of the meeting but need not state the purpose thereof. Whenever any
notice is required to be given to any Director under the provisions of these
By-Laws, the Certificate of Incorporation or the General Corporation Law of
Delaware, a waiver thereof in writing, signed by the person or persons entitled
to such notice, whether before or after the time stated therein, shall be
deemed equivalent to the giving of such notice. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the Board
or any committee appointed by the Board need be specified in the waiver of
notice of such meeting. Attendance of a Director at any meeting shall
constitute a waiver of notice of such meeting except when a Director attends a
meeting for the express purpose of objecting to the transaction of any business
because the meeting was not lawfully called or convened. (Amended July 7,
1992)

SECTION 9. QUORUM AND MANNER OF ACTING.

Except as otherwise provided by statute, the Certificate of
Incorporation, or these By-Laws, the presence of a majority of the total number
of Directors shall constitute a quorum for the transaction of business at any
regular or special meeting of the Board of Directors, and the act of a majority
of the Directors present at any such meeting at which a quorum is present shall
be the act of the Board of Directors. In the absence of a quorum, a majority
of the Directors present may adjourn the meeting, from time to time, until a
quorum is present. Notice of any such adjourned meeting need not be given.

SECTION 10. ORGANIZATION.

At every meeting of the Board of Directors, the Chairman of the Board
or in his absence the President or, if both of the said officers are absent, a
Chairman chosen by a majority of the Directors present shall act as Chairman of
the meeting. The Secretary, or in his absence, an Assistant Secretary, or in
the absence of the Secretary and all the Assistant Secretaries, any person
appointed by the Chairman of the meeting, shall act as Secretary of the
meeting. (Amended July 7, 1992)

SECTION 11. CONSENT OF DIRECTORS IN LIEU OF MEETING.

Unless otherwise restricted by the Certificate of Incorporation or by
these By-Laws, any action required or permitted to be taken at any meeting of
the Board of Directors, or any committee designated by the Board, may be taken
without a meeting if all members of the Board or committee consent thereto in
writing, and such written consent is filed with the minutes of the proceedings
of the Board or committee.

SECTION 12. TELEPHONIC MEETINGS.

Members of the Board of Directors, or any committee designated by the
Board of Directors, may participate in a meeting of the Board or committee by
means of conference telephone or similar communications equipment by means of
which all persons participating in

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<PAGE> 12

the meeting can hear each other, and participation in such a meeting shall
constitute presence in person at such meeting.

SECTION 13. COMPENSATION.

Each Director, who is not a full-time salaried officer of the
corporation or any of its wholly owned subsidiaries, when authorized by
resolution of the Board of Directors, may receive as a Director a stated salary
or an annual retainer and in addition may be allowed a fixed fee and his
reasonable expenses for attendance at each regular or special meeting of the
Board of any Committee thereof.

ARTICLE IV

COMMITTEES OF THE BOARD OF DIRECTORS

SECTION 1. EXECUTIVE COMMITTEE.

The Board of Directors may, in its discretion, designate annually an
Executive Committee consisting of not less than five Directors as it may from
time to time determine. The Committee shall have and may exercise all the
powers and authority of the Board of Directors in the management of the business
and affairs of the corporation and may authorize the seal of the corporation to
be affixed to all papers which may require it, but the Committee shall have no
power or authority to amend the Certificate of Incorporation (except that the
Committee may, to the extent authorized in the resolution or resolutions
providing for the issuance of shares of stock adopted by the Board of Directors,
fix the designations and any of the preferences or rights of such shares
relating to dividends, redemption, dissolution, any distribution of assets of
the corporation or the conversion into, or the exchange of such shares for,
shares of any other class or classes or any other series of the same or any
other class or classes of stock of the corporation or fix the number of shares
of any series of stock or authorize the increase or decrease of the shares of
any series), adopt an agreement of merger or consolidation, recommend to the
stockholders the sale, lease or exchange of all or substantially all of the
corporation's property and assets, recommend to the stockholders a dissolution
of the corporation or a revocation of a dissolution, amend the By- Laws of the
corporation, elect officers or fill vacancies on the Board of Directors or any
Committee of the Board, declare a dividend, authorize the issuance of stock, or
such other powers as the Board may from time to time eliminate.

SECTION 2. FINANCE COMMITTEE.

The Board of Directors may, in its discretion, designate annually a
Finance Committee, consisting of such number of Directors as the Board of
Directors may from time to time determine. The Committee shall monitor,
review, appraise and recommend to the Board of Directors appropriate action
with respect to the corporation's capital structure, its source of funds and
its financial position; review and recommend appropriate delegations of
authority to management on expenditures and other financial commitments; review
terms and conditions of

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financing plans; develop and recommend dividend policies and recommend to the
Board specific dividend payments; review the performance of the trustee of the
corporation's pension trust fund, and any proposed change in the investment
policy of the trustee with respect to such fund; and such other duties,
functions and powers as the Board may from time to time prescribe.

SECTION 3. AUDIT COMMITTEE.

The Board of Directors shall designate annually an Audit Committee
consisting of not less than three Directors as it may from time to time
determine, none of whom shall be officers of the corporation. The Committee
shall review with the independent accountants the corporation's financial
statements, basic accounting and financial policies and practices, competency
of control personnel, standard and special tests used in verifying the
corporation's statements of account and in determining the soundness of the
corporation's financial condition and report to the Board the results of such
reviews; review the policies and practices pertaining to publication of
quarterly and annual statements to assure consistency with audited results and
the implementing of policies and practices recommended by the independent
accountants; ensure that suitable independent audits are made of the operations
and results of subsidiary corporations and affiliates; monitor compliance with
the corporation's code of business conduct, and such other duties, functions
and powers as the Board may from time to time prescribe.

SECTION 4. COMPENSATION AND NOMINATING COMMITTEE.

The Board of Directors shall designate annually a Compensation and
Nominating Committee consisting of such number of Directors as the Board of
Directors may from time to time determine. The Committee shall review, report
and make recommendations to the Board of Directors on the following matters:

(a) The compensation of the Chief Executive Officer and all senior
officers of the corporation and its principal operating
subsidiaries reporting directly to the Chief Executive Officer
following an annual review of management's recommendations for
the individuals involved. If circumstances involving
individuals require a salary adjustment between such reviews, a
recommendation may be made directly to the Board of Directors
by the Chief Executive Officer without the necessity of a
meeting of the Compensation and Nominating Committee.

(b) The size and composition of the Board and nominees for
Directors; evaluate the performance of the officers of the
corporation and together with management, select and recommend
to the Board appropriate individuals for election, appointment
and promotion as officers of the corporation and ensure the
continuity of able capable management.

(c) Any proposed stock option plans, stock purchase plans,
retirement plans, and any other plans, systems and practices of
the corporation relating to the compensation of any employees of
the corporation and any proposed plans

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<PAGE> 14

of any subsidiary company involving the issuance or purchase of
capital stock of the corporation.

(d) Such other matters as the Board may from time to time prescribe.

The Committee shall carry out the duties assigned to the Committee
under any existing stock option plans or other existing compenstion or benefit
plans; and shall perform such other duties and have such other powers as the
Board of Directors may from time to time prescribe. (Amended July 7, 1992 and
December 6, 1995)

SECTION 5. COMMITTEE CHAIRMAN, BOOKS AND RECORDS.

Each Committee shall elect a Chairman to serve for such term as it may
determine, shall fix its own rules of procedure and shall meet at such times
and places and upon such call or notice as shall be provided by such rules. It
shall keep a record of its acts and proceedings, and all action of the
Committee shall be reported to the Board of Directors at the next meeting of
the Board.

SECTION 6. ALTERNATES.

Alternate members of the Committees prescribed by this Article IV may
be designated by the Board of Directors from among the Directors to serve as
occasion may require. Whenever a quorum cannot be secured for any meeting of
any such Committee from among the regular members thereof and designated
alternates, the member or members of such Committee present at such meeting and
not disqualified from voting, whether or not he or they constitute a quorum,
may unanimously appoint another member of the Board to act at the meeting in
the place of such absent or disqualified member.

Alternative members of such Committees shall receive a reimbursement
for expenses and compensation at the same rate as regular members of such
Committees.

SECTION 7. OTHER COMMITTEES.

The Board of Directors may designate such other Committees, each to
consist of two or more Directors, as it may from time to time determine, and
each such Committee shall serve for such term and shall have and may exercise,
during intervals between meetings of the Board of Directors, such duties,
functions and powers as the Board of Directors may from time to time prescribe.

SECTION 8. QUORUM AND MANNER OF ACTING.

At each meeting of any Committee the presence of a majority of the
members of such Committee, whether regular or alternate, shall be necessary to
constitute a quorum for the transaction of business, and if a quorum is present
the concurrence of a majority of those present shall be necessary for the
taking of any action; provided, however, that no action may be taken

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<PAGE> 15

by the Executive Committee or the Finance Committee when two or more officers of
the corporation are present as members at a meeting of either such Committee
unless such action shall be concurred in by the vote of two or more members of
such Committee who are not officers of the corporation.

ARTICLE V

OFFICERS

SECTION 1. NUMBER.

The officers of the corporation shall be a Chairman of the Board, a
President and Chief Executive Officer, an Executive Vice President and Chief
Financial Officer, an Executive Vice President, Law, a Secretary, a Treasurer,
and such other officers as may be elected or appointed by the Board of
Directors. Any number of offices may be held by the same person. (Amended July
7, 1992 and December 6, 1995)

SECTION 2. ELECTION, TERM OF OFFICE AND QUALIFICATIONS.

The officers of the corporation shall be elected annually by the Board
of Directors. Each officer elected by the Board of Directors shall hold office
until his successor shall have been duly elected and qualified, or until he
shall have died, resigned or been removed in the manner hereinafter provided.

SECTION 3. RESIGNATIONS.

Any officer may resign at any time upon written notice to the
Secretary of the corporation. Such resignation shall take effect at the date
of its receipt, or at any later date specified therein; and the acceptance of
such resignation, unless required by the terms thereof, shall not be necessary
to make it effective.

SECTION 4. REMOVALS.

Any officer elected or appointed by the Board of Directors may be
removed, with or without cause, by the Board of Directors at a regular meeting
or special meeting of the Board. Any officer or agent appointed by any officer
or committee may be removed, either with or without cause, by such appointing
officer or committee.

SECTION 5. VACANCIES.

Any vacancy occurring in any office of the corporation shall be filled
for the unexpired portion of the term in the same manner as prescribed in these
By-Laws for regular election or appointment to such office.

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SECTION 6. COMPENSATION OF OFFICERS.

The compensation of all officers elected by the Board of Directors
shall be approved or authorized by the Board of Directors or by the President
and Chief Executive Officer when so authorized by the Board of Directors or
these By- Laws. (Amended July 7, 1992 and December 6, 1995)

SECTION 7. CHAIRMAN OF THE BOARD.

The Chairman of the Board shall, when present, preside at all meetings
of the stockholders and of the Board of Directors; have authority to call
special meetings of the stockholders and of the Board of Directors; have
authority to sign and acknowledge in the name and on behalf of the corporation
all stock certificates, contracts or other documents and instruments except
when the signing thereof shall be expressly delegated to some other officer or
agent by the Board of Directors or required by law to be otherwise signed or
executed and, unless otherwise provided by law or by the Board of Directors,
may authorize any officer, employee or agent of the corporation to sign,
execute and acknowledge in his place and stead all such documents and
instruments. He shall consult with the President and Chief Executive Officer
regarding the strategic direction and business and affairs of the corporation
and shall have such other powers and perform such other duties as from time to
time may be assigned to him by the Board of Directors or the Executive
Committee. (Amended July 7, 1992 and December 6, 1995)

SECTION 8. PRESIDENT AND CHIEF EXECUTIVE OFFICER.

The President and Chief Executive Officer shall, in the absence of the
Chairman of the Board, preside at all meetings of the stockholders and of the
Board of Directors and have authority to call special meetings of the
stockholders and of the Board of Directors. The President and Chief Executive
Officer shall have general authority over the property, business and affairs of
the corporation, and over all other officers, agents and employees of the
corporation, subject to the control and direction of the Board of Directors and
the Executive Committee, including the power to sign and acknowledge in the name
and on behalf of the corporation all stock certificates, contracts or other
documents and instruments except when the signing thereof shall be expressly
delegated to some other officer or agent by the Board of Directors or required
by law to be otherwise signed or executed and, unless otherwise provided by law
or by the Board of Directors, may authorize any officer, employee or agent of
the corporation to sign, execute and acknowledge in his place and stead all such
documents and instruments; he shall fix the compensation of officers of the
corporation other than his own compensation and that of the senior officers of
the corporation and its principal operating subsidiaries reporting directly to
him; and he shall approve proposed employee compensation and benefit plans of
subsidiary companies not involving the issuance or purchase of capital stock of
the corporation.

The President and Chief Executive Officer is hereby authorized,
without further approval of the Finance Committee or the Board of Directors:

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(a) To approve any expenditure by the corporation of up to $20 million for
those expenditure categories presented to the Board of Directors in the
annual budget and up to $10 million for any expenditure categories not
presented, including investments, leases, options to purchase or lease
assets, business acquisitions and land purchases.

(b) To approve individual cost overruns of up to 10% of any amounts
approved by or presented to the Board of Directors.

(c) To approve disposition of assets and interests in securities of
subsidiaries or related commitments, provided that the aggregate
market value of the assets being disposed of in any one such
transaction does not exceed $10 million.

(d) To enter into leases or extensions thereof and other agreements with
respect to the assets of the corporation, including interests in
minerals and real estate, for a term of not more than 10 years or for
an unlimited term if the aggregate initial rentals, over the term of
the lease, including renewal options, do not exceed $3 million.

(e) To approve increases in the capital budgets of the corporation's
operating subsidiaries provided such increases in the aggregate do not
exceed 10% of the corporation's capital budget for the fiscal year.

(f) To approve in emergency situations commitments in excess of the
above-described limits provided they are in the interests of the
corporation.

The above delegation of authority does not authorize the corporation or its
subsidiaries to make a significant change in its business or to issue the
corporation's capital stock without the specific approval of the Board of
Directors. Notwithstanding these limitations, the President and Chief
Executive Officer shall have such power and authority as is usual, customary
and desirable to perform all the duties of the office. (Amended July 7, 1992
and December 6, 1995)

SECTION 9. EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER.

The Executive Vice President and Chief Financial Officer shall have
responsibility for development and administration of the corporation's
financial plans and all financial arrangements, its insurance programs, its
cash deposits and short term investments, its accounting policies, and its
federal and state tax returns. Such officer shall also be responsible for the
corporation's internal control procedures and for its relationship with the
financial community. (Amended July 7, 1992 and December 6, 1995)

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SECTION 10. EXECUTIVE VICE PRESIDENT, LAW.

The Executive Vice President, Law shall be the chief legal advisor of
the corporation and shall have charge of the management of the legal affairs
and litigation of the corporation. (Amended July 7, 1992 and December 6,
1995)

SECTION 11. SECRETARY.

The Secretary shall record the proceedings of the meetings of the
stockholders and directors, in one or more books kept for that purpose; see
that all notices are duly given in accordance with the provisions of the
By-Laws or as required by law; have charge of the corporate records and of the
seal of the corporation; affix the seal of the corporation or a facsimile
thereof, or cause it to be affixed, to all certificates for shares prior to the
issue thereof and to all documents the execution of which on behalf of the
corporation under its seal is duly authorized by the Board of Directors or
otherwise in accordance with the provisions of the By-Laws; keep a register of
the post office address of each stockholder, director or member, sign with the
Chairman of the Board or the President, certificates for shares of stock of the
corporation, the issuance of which shall have been duly authorized by
resolution of the Board of Directors; have general charge of the stock transfer
books of the corporation; and in general, perform all duties incident to the
office of Secretary and such other duties as from time to time may be assigned
to him by the Board of Directors, the Executive Committee, the Chairman of the
Board, the President, or the Executive Vice President, Law. (Amended July 7,
1992 and December 6, 1995)

SECTION 12. TREASURER.

The Treasurer shall have the responsibility for the custody and
safekeeping of all funds of the corporation and shall have charge of their
collection, receipt and disbursement; shall receive and have authority to sign
receipts for all monies paid to the corporation and shall deposit the same in
the name and to the credit of the corporation in such banks or depositories as
the Board of Directors shall approve; shall endorse for collection on behalf of
the corporation all checks, drafts, notes and other obligations payable to the
corporation; shall sign or countersign all notes, endorsements, guaranties and
acceptances made on behalf of the corporation when and as directed by the Board
of Directors; shall give bond for the faithful discharge of his duties in such
sum and with such surety or sureties as the Board of Directors may require;
shall have the responsibility for the custody and safekeeping of all securities
of the corporation; and in general shall have such other powers and perform
such other duties as are incident to the office of Treasurer and as from time
to time may be prescribed by the Board of Directors or be delegated to him by
the Chairman of the Board, the President or the Executive Vice President and
Chief Financial Officer. (Amended July 7, 1992 and December 6, 1995)

SECTION 13. ABSENCE OR DISABILITY OF OFFICERS.

In the absence or disability of the Chairman of the Board or the
President, the Board of Directors may designate, by resolution, individuals to
perform the duties of those absent or

14
<PAGE> 19

disabled. The Board of Directors may also delegate this power to a committee or
to a senior corporate officer. (Amended July 7, 1992)

ARTICLE VI

STOCK CERTIFICATES AND TRANSFER THEREOF

SECTION 1. STOCK CERTIFICATES.

Except as otherwise permitted by statute, the Certificate of
Incorporation or resolution or resolutions of the Board of Directors, every
holder of stock in the corporation shall be entitled to have a certificate,
signed by or in the name of, the corporation by the Chairman of the Board, the
President, or a Vice President, and by the Treasurer or an Assistant Treasurer,
or the Secretary or an Assistant Secretary of the corporation, certifying the
number of shares, and the class and series thereof, owned by him in the
corporation. Any and all of the signatures on the certificate may be a
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue. (Amended July
7, 1992)

SECTION 2. TRANSFER OF STOCK.

Transfer of shares of the capital stock of the corporation shall be
made only on the books of the corporation by the holder thereof, or by his
attorney duly authorized, and on surrender of the certificate or certificates
for such shares. A person in whose name shares of stock stand on the books of
the corporation shall be deemed the owner thereof as regards the corporation,
and the corporation shall not, except as expressly required by statute, be
bound to recognize any equitable or other claim to, or interest in, such shares
on the part of any other person whether or not it shall have express or other
notice thereof.

SECTION 3. TRANSFER AGENT AND REGISTRAR.

The corporation shall at all times maintain a transfer office or
agency in the Borough of Manhattan, The City of New York, in charge of a
transfer agent designated by the Board of Directors (who shall have custody,
subject to the direction of the Secretary, of the original stock ledger and
stock records of the corporation), where the shares of the capital stock of the
corporation of each class shall be transferable, and also a registry office in
the Borough of Manhattan, The City of New York, other than its transfer office
or agency in said city, in charge of a registrar designated by the Board of
Directors, where its stock of each class shall be registered. The corporation
may, in addition to the said offices, if and whenever the Board of Directors
shall so determine, maintain in such place or places as the Board shall
determine, one or more additional transfer offices or agencies, each in charge
of a transfer agent designated by the Board, where the shares of capital stock
of the corporation of any class or classes shall be

15
<PAGE> 20

transferable, and also one or more additional registry offices, each in charge
of a registrar designated by the Board of Directors, where such shares of stock
of any class or classes shall be registered. Except as otherwise provided by
resolution of the Board of Directors in respect of temporary certificates, no
certificates for shares of capital stock of the corporation shall be valid
unless countersigned by a transfer agent and registered by a registrant
authorized as aforesaid.

SECTION 4. ADDITIONAL REGULATIONS.

The Board of Directors may make such additional rules and regulations
as it may deem expedient concerning the issue, transfer and registration of
certificates for shares of the capital stock of the corporation.

SECTION 5. LOST, DESTROYED OR MUTILATED CERTIFICATES.

The Board of Directors may provide for the issuance of new
certificates of stock to replace certificates of stock lost, stolen, mutilated
or destroyed, or alleged to be lost, stolen, mutilated or destroyed, upon such
terms and in accordance with such procedures as the Board of Directors shall
deem proper and prescribe.

ARTICLE VII

DIVIDENDS, SURPLUS, ETC.

Except as otherwise provided by statute or the Certificate of
Incorporation, the Board of Directors may declare dividends upon the shares of
its capital stock either (1) out of its surplus, or (2) in case there shall be
no surplus, out of its net profits for the fiscal year, whenever, and in such
amounts as, in its opinion, the condition of the affairs of the corporation
shall render it advisable. Dividends may be paid in cash, in property, or in
shares of the capital stock of the corporation.

ARTICLE VIII

SEAL

The Board of Directors shall adopt a suitable corporate seal which
shall be in the form imprinted hereon. The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or in any other manner reproduced.

16
<PAGE> 21

ARTICLE IX

FISCAL YEAR

The fiscal year of the corporation shall begin on the first day of
January of each year.

ARTICLE X

INDEMNIFICATION

SECTION 1. RIGHT TO INDEMNIFICATION.

Each person who was or is made a party or is threatened to be made a
party to or is involved (including, without limitation, as a witness) in any
actual or threatened action, suit or proceeding, whether civil, criminal,
administrative or investigative (hereinafter a "proceeding"), by reason of the
fact that he or she is or was a Director or officer of the corporation or is or
was serving at the request of the corporation as a director, officer, employee
or agent of another corporation or of a partnership, joint venture, trust or
other enterprise, including service with respect to an employee benefit plan
(hereinafter an "indemnitee"), whether the basis of such proceeding is alleged
action in an official capacity as a Director, officer, employee or agent or in
any other capacity while serving as such a director, officer, employee or agent,
shall be indemnified and held harmless by the corporation to the full extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the corporation to provide broader indemnification
rights than said law permitted the corporation to provide prior to such
amendment), or by other applicable law as then in effect, against all expense,
liability and loss (including attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts to be paid in settlement) actually and reasonably
incurred or suffered by such indemnitee in connection therewith and such
indemnification shall continue as to an indemnitee who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
indemnitee's heirs, executors and administrators, provided, however, that except
as provided in Section 2 of this Article with respect to proceedings seeking to
enforce rights to indemnification, the corporation shall indemnify any such
indemnitee seeking indemnification in connection with a proceeding (or part
thereof) initiated by such indemnitee only if such proceeding (or part thereof)
was authorized by the Board of Directors of the corporation. The right to
indemnification conferred in this Section shall be a contract right and shall
include the right to be paid by the corporation the expenses incurred in
defending any such proceeding in advance of its final disposition (hereinafter
an "advancement of expenses"); provided, however, that, if the Delaware General
Corporation Law requires, an advancement of expenses incurred by an indemnitee
in his or her capacity as a Director or officer (and not in any other capacity
in which service was or is rendered by such indemnitee while a Director or
officer, including, without limitation, service to an employee benefit plan)
shall be made only upon delivery to the corporation of an undertaking, by or on
behalf of such indemnitee, to repay all amounts so advanced if it shall
ultimately be

17
<PAGE> 22

determined that such indemnitee is not entitled to be indemnified under this
Section 1, or otherwise.

SECTION 2. RIGHT OF INDEMNITEE TO BRING SUIT.

If a claim under Section 1 of this Article is not paid in full by the
corporation within sixty days after a written claim has been received by the
corporation, except in the case of a claim for an advancement of expenses, in
which case the applicable period shall be twenty days, the indemnitee may at
any time thereafter bring suit against the corporation to recover the unpaid
amount of the claim and, to the extent successful in whole or in part, the
indemnitee shall be entitled to be paid also the expense of prosecuting such
suit. The indemnitee shall be presumed to be entitled to indemnification under
this Article upon submission of a written claim (and, in an action brought to
enforce a claim for an advancement of expenses, where the required undertaking,
if any is required, has been tendered to the corporation), and thereafter the
corporation shall have the burden of proof to overcome the presumption that the
indemnitee is not so entitled. Neither the failure of the corporation
(including its Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
suit that indemnification of the indemnitee is proper in the circumstances nor
an actual determination by the corporation (including its Board of Directors,
independent legal counsel or its stockholders) that the indemnitee is not
entitled to indemnification shall be a defense to the suit or create a
presumption that the indemnitee is not so entitled.

SECTION 3. NONEXCLUSIVITY OF RIGHTS.

The rights to indemnification and to the advancement of expenses
conferred in this Article shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, provision of the
Certificate of Incorporation, By-Law, agreement, vote of stockholders or
disinterested Directors or otherwise.

SECTION 4. INSURANCE, CONTRACTS AND FUNDING.

The corporation may maintain insurance, at its expense, to protect
itself and any Director, officer, employee or agent of the corporation or
another corporation, partnership, joint venture, trust or other enterprise
against any expense, liability or loss, whether or not the corporation would
have the power to indemnify such person against such expense, liability or loss
under the Delaware General Corporation Law. The corporation may enter into
contracts with any indemnitee in furtherance of the provisions of this Article
and may create a trust fund, grant a security interest or use other means
(including, without limitation, a letter of credit) to ensure the payment of
such amounts as may be necessary to effect indemnification as provided in this
Article.

18
<PAGE> 23

SECTION 5. DEFINITION OF DIRECTOR AND OFFICER.

Any person who is or was serving as a Director or officer of a wholly
owned subsidiary of the corporation shall be deemed, for purposes of this
Article only, to be a Director or officer of the corporation entitled to
indemnification under this Article.

SECTION 6. INDEMNIFICATION OF EMPLOYEES AND AGENTS OF THE
CORPORATION.

The corporation may, by action of the Board of Directors from time to
time, grant rights to indemnification and advancement of expenses to employees
and agents of the corporation with the same scope and effect as the provisions
of this Article with respect to the indemnification and advancement of expenses
of Directors and officers of the corporation.

ARTICLE XI

CHECKS, DRAFTS, BANK ACCOUNTS, ETC.

SECTION 1. CHECKS, DRAFTS, ETC.; LOANS.

All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation shall be
signed by such officer or officers, agent or agents of the corporation and in
such manner as shall, from time to time, be determined by resolution of the
Board of Directors. No loans shall be contracted on behalf of the corporation
unless authorized by the Board of Directors. Such authority may be general or
confined to specific circumstances. (Amended July 7, 1992)

SECTION 2. DEPOSITS.

All funds of the corporation shall be deposited, from time to time, to
the credit of the corporation in such banks, trust companies or other
depositories as the Board of Directors may select, or as may be selected by any
officer or officers, agent or agents of the corporation to whom such power may,
from time to time, be delegated by the Board of Directors; and for the purpose
of such deposit, the Chairman of the Board, the President, any Vice President,
the Treasurer or any Assistant Treasurer, the Secretary or any Assistant
Secretary, or any other officer or agent to whom such power may be delegated by
the Board of Directors, may endorse, assign and deliver checks, drafts and
other order for the payment of money which are payable to the order of the
corporation.

19
<PAGE> 24
ARTICLE XII

AMENDMENTS

These By-Laws may be altered or repealed and new By-Laws may be made
by the affirmative vote, at any meeting of the Board, of a majority of the
whole Board of Directors, subject to the rights of the stockholders of the
corporation to amend or repeal By-Laws made or amended by the Board of
Directors by the affirmative vote of the holders of record of a majority in
number of shares of the outstanding stock of the corporation present or
represented at any meeting of the stockholders and entitled to vote thereon,
provided that notice of the proposed action be included in the notice of such
meeting.

<PAGE> 1
EXHIBIT 10.6

December 6, 1995

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

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, December 8, 1993, and December 7, 1994. 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. Employment and Term. The Company agrees to employ you and you
agree to act as its Chairman of the Board during the period commencing
December 6, 1995 and ending on December 15, 1998, unless sooner terminated by
death, permanent disability or the mutual agreement of the parties.

2. Base Compensation. Effective January 1, 1996, the
base compensation described in Section 2 of the Agreement will be $500,000
per annum.

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.

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/ H. E. HAUNSCHILD
-------------------------------------
By Harold E. Haunschild
Its Vice President, Human Resources

ACCEPTED AND AGREED TO
this 18TH day of December, 1995

/s/ THOMAS H. O'LEARY
- -------------------------------------------
Thomas H. O'Leary

<PAGE> 1
EXHIBIT 10.7

December 6, 1995

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

Dear Bobby,

Your Employment Agreement with Burlington Resources Inc. (the "Company") is
dated April 30, 1993 and was previously amended on November 8, 1994. 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 and restate
the agreement with respect to the matters addressed herein. Accordingly, this
letter, when accepted by you in the space provided below, will amend and
restate the agreement in its entirety:

1. Position and Term. The Company agrees to employ you and you agree to
act as its President and Chief Executive Officer during the period commencing
December 6, 1995 and ending on December 15, 2000.

2. Base Salary. Your minimum salary will be $600,000 per annum or such
higher rate as may be fixed from time to time by the Board.

3. Incentive Compensation, Long-Term Incentives and Other Benefits. You
will participate with other senior executives of the Company in compensation
and benefit plans in effect from time to time including the Incentive
Compensation Plan, the Stock Incentive Plan, the Performance Share Unit Plan,
the Deferred Compensation Plan, the Supplemental Benefits Plan, the Senior
Executive Survivor Benefit Plan, the Key Executive Severance Protection Plan
and any other plan or perquisites available to other executives at your level
of responsibility in the Company, including a company automobile and
company-provided country and luncheon club memberships. You will also
participate in health, retirement, survivor and disability plans available to
all employees of the Company. You understand that the Company may amend,
modify or terminate these plans at any time. All plans referenced in this
agreement are BR plans.

Your maximum bonus opportunity under the Incentive Compensation Plan will be
100% of base salary. Annual bonuses are determined by the Compensation and
Nominating Committee of the Board (the "Compensation Committee") based on
Company and individual performance.

<PAGE> 2

Mr. Bobby S. Shackouls
December 6, 1995
Page 2

In consideration of the accrued unvested compensation and benefits that you
forfeited in terminating employment with a former employer, the Company
established a deferred compensation memorandum account under the Supplemental
Benefits Plan. This account was credited with $350,000 as of June 1, 1993.
This arrangement is an unfunded deferred compensation arrangement which will be
paid to you in a lump-sum upon your termination of employment with the Company.

4. Supplemental Pension Benefit. You are a participant under the
qualified Pension Plan and non-qualified Supplemental Benefits Plan. If you
are still employed by the Company at age 55, you will receive upon your
retirement a supplemental pension benefit equal to the difference between the
benefit calculated using your actual service and the benefit calculated
assuming you started employment at age 30. If your employment is terminated by
the Company after age 50, you will receive the supplemental pension benefit at
termination equal to the supplemental benefit described above, assuming the
pension annuity commenced at age 55. This supplemental pension benefit will be
calculated using the provisions of the qualified Pension Plan and the
non-qualified Supplemental Benefits Plan in effect at the time of your
retirement. This benefit is a non-qualified, unfunded deferred compensation
arrangement.

5. Severance Benefit. If your employment is terminated by the Company
for any reason before December 15, 2000, other than as a result of your death,
permanent disability or for Cause, or is initiated by you for Good Reason, the
Company will pay you within 10 days after the date of termination an amount
equal to the product of the number of whole and partial months remaining from
the date of your termination until December 15, 2000, times your then current
monthly base salary. The terms Cause and Good Reason are defined in the Key
Executive Severance Protection Plan.

6. Coordination With Other Plans. If your termination entitles you to
benefits under the Key Executive Severance Protection Plan, you may elect to
receive the benefits payable under this agreement in lieu of those benefits.
If you elect to receive the benefits under this agreement, you will
nevertheless be eligible to receive the additional benefits related to the
gross-up payment for excise taxes under Article 6 of that plan.

7. Non-Disclosure. As an officer of the Company, you will have access to
and continue to receive and develop confidential and proprietary information
and trade secrets pertaining to the business of the Company and its affiliates,
including, without limitation, reports, maps, data (including geologic and
seismic data and interpretations thereof), plans, and contracts. As part of
the consideration for this agreement and in return for receiving access to such
confidential information, you agree to keep all such confidential and
proprietary information confidential. In particular, you agree that you will
not divulge, communicate or otherwise disclose any confidential information
furnished to

<PAGE> 3

Mr. Bobby S. Shackouls
December 6, 1995
Page 3

you or obtained or developed by you while employed by the Company to any
person, firm, corporation or entity other than to an authorized representative
of the Company. You agree that if your employment with the Company is
terminated, you will not discuss the Company's business, operations, plans,
strategies, personnel or business relationships or agreements with the press or
with any of the Company's current or prospective customers or suppliers or with
any other person with which the Company has business relationships.

8. Non-Competition. In order to enforce your obligations under Section 7
and in consideration for the benefits of employment described in this
agreement, you agree to the covenant not to compete in this Section 8. You
agree and acknowledge that this covenant not to compete is ancillary to your
commitment as set forth in Section 7 to refrain from disclosing such
confidential information. If you initiate the termination of your employment
with the Company other than for Good Reason during the term of this agreement,
you agree that you will not for a period of two years after your termination be
employed by, consult with, provide advice or information to, otherwise perform
services for, own, manage, operate, join, control or participate in the
ownership of more than 5% of the voting power of equity securities of,
management, operation or control of any Competitor (as defined in this
agreement) unless released by the Company from such obligation in writing with
respect to a specific situation. A Competitor is defined as any entity (i)
that is engaged in exploring for and producing oil and natural gas in
Louisiana, Montana, New Mexico, North Dakota, Oklahoma, Texas or federal or
state waters in the Gulf of Mexico or in the oil and gas marketing business in
the mainland United States and (ii) whose assets associated with such oil and
gas business exceed $50 million.

9. Non-Interference. For a period ending on the later of December 15,
2000 or two years after you terminate employment with the Company, you agree
not to solicit, directly or indirectly, any officer or employee of the Company
to leave and work for any other employer. During this same period, you agree
not to suggest to others that they approach or solicit any officers or
employees of the Company with respect to potential employment elsewhere.

10. Severability and Enforcement. It is the desire of the parties hereto
that this agreement be enforced to the maximum extent permitted by law, and
should any provision contained herein be held unenforceable, the parties hereby
agree and consent that such provision will be reformed to make it a valid and
enforceable provision to the maximum extent permitted by law. Any provision
hereof not capable of such reformation and determined to be prohibited by or
unenforceable under applicable law of any jurisdiction will as to such
jurisdiction be deemed ineffective and deleted from this agreement without
affecting any other provision of this agreement.

<PAGE> 4

Mr. Bobby S. Shackouls
December 6, 1995
Page 4

In the event of a breach by you of any of the provisions of Sections 7, 8 or 9,
you understand and agree that the Company may, in addition to any other rights
or remedies existing in its favor, apply to any court of law or equity of
competent jurisdiction for specific performance and injunctive or other relief
in order to enforce or prevent any violations of such provisions.

You understand and agree that this agreement is being executed by the Company
on behalf of itself and each of its affiliates, and that all rights of the
Company under this agreement and all of your obligations and duties under this
agreement will inure to the benefit of and may be enforced by the Company or
any of its affiliates.

If the above correctly set forth our agreement, please sign the original and
return it to me. Please retain a copy for your records.

Very truly yours,

BURLINGTON RESOURCES INC.

/s/ H. E. HAUNSCHILD
---------------------------------------
By Harold E. Haunschild
Its Vice President, Human Resources

ACCEPTED and AGREED TO
this 18TH day of December, 1995

/s/ BOBBY S. SHACKOULS
- ---------------------------------------
Bobby S. Shackouls

<PAGE> 1
EXHIBIT 10.10

AMENDMENT FOUR
BURLINGTON RESOURCES INC.
RETIREMENT SAVINGS PLAN

The Burlington Resources Inc. Retirement Savings Plan, as adopted effective as
of January 1, 1990, subject to various adoption agreements with participating
employers (the "Plan"), has previously been amended by Amendment One adopted on
August 23, 1990, by the unnumbered amendment to the Plan and specified
predecessor plans adopted on December 13, 1991, and by Amendment Three adopted
on July 8, 1992. This Amendment Four is adopted, effective as shown below, in
order to provide greater flexibility in the timing of elections relating to
Participants' contributions and Plan investments; to eliminate prior
restrictions on amounts invested in Participants' ESOP Rollover Accounts; to
permit past service with an acquired business to count toward eligibility for
additional matching contributions that Participants can receive after 10 years
of employment; to address compliance requirements relating to (i) the reduced
Internal Revenue Code section 401(a)(17) limit of $150,000 that applies to Plan
compensation in 1994, (ii) the handling of eligible rollover distributions
under Code section 401(a)(31) and related authorities beginning in 1993, and
(iii) the Department of Labor's regulations for participant-directed
investments under section 404(c) of ERISA; and to make other Plan changes of a
minor, clarifying nature.

1. Subsection 2.1(e) is hereby amended to read as follows, effective as of
June 1, 1993:

(e) "Beneficiary" means the person or persons (who may be named
contingently or successively) designated by a Participant (or
the Beneficiary of a deceased Participant) to receive his
Account in the event of his death. Each designation shall be
in a form prescribed by the

-1-

<PAGE> 2
Committee, shall revoke all prior designations by the same
Participant, and shall be effective only when filed in a writing that
is acknowledged by a Plan representative. The designation of a
Beneficiary shall be disregarded if the Beneficiary makes a legally
valid disclaimer of any interest under the designation, if the
Beneficiary is a natural person who does not survive the Participant,
or if the Beneficiary is a legal entity that does not exist at the
Participant's death. The determination of whether a natural person
survives the Participant shall be made by the Committee in accordance
with the Uniform Simultaneous Death Act. If more than one person is
designated together in the same Beneficiary priority category, the
percentage share of each shall be equal unless the percentage of each
is specifically indicated. If persons are named as Beneficiaries
contingently or successively, the contingency and the order of their
succession shall be clearly indicated. The designation by a married
Participant of a Beneficiary other than his spouse shall be invalid
unless the spouse consents in writing to such designation, the consent
acknowledges the effect of such designation and is notarized or is
witnessed by a Plan representative, and the Beneficiary designation
complies in all other respects with the requirements of Code sections
401(a)(11)(B)(iii)(I) and 417(a)(2). However, no consent shall be
required if it is established to the satisfaction of the Plan
representative that such consent cannot be obtained because there is
no spouse or because the spouse cannot be located. If there is no
surviving spouse and if no other Beneficiary is designated, then the
Beneficiary shall be the Participant's estate. If a designation is
ineffective in whole or in part, all or such part of the Participant's
Account as has not been distributed, shall be payable to the
Participant's surviving spouse, or if the deceased Participant has no
surviving spouse, to his estate. If a deceased

-2-
<PAGE> 3
Participant's Beneficiary has begun to receive payments hereunder and
does not survive to receive all payments that are due from the Plan,
the payments remaining after his death shall be made to such
Beneficiary's designated Beneficiary, if any, or, if none, to his
estate.

2. Subsection 2.1(g) is hereby amended to read as follows, effective
as of June 1, 1993:

(g) "Change Date" means the effective date of a Participant's election,
made in accordance with the terms and limitations specified below and
elsewhere in the Plan, to begin, stop, increase, or decrease the
amount of Basic Contributions or Supplemental Contributions to his
Account under the Plan, or to change the before-tax or after-tax
nature of Basic Contributions or direct the way that his future
contributions or the amounts in his Account are to be invested. The
Change Date for elections affecting the level or nature of a
Participant's contributions is the first day of the month after the
election, and a Participant may make such contribution elections in
any month without regard to the number of other elections that he has
made or their frequency. The Change Date for elections relating to the
investment of a Participant's future contributions or existing Account
balances is also the first day of the month after the election,
although changes in the investment of existing Account balances may be
reflected in statements that show closing balances as of the last
moment of the month ending just prior to the Change Date. Except as
otherwise permitted under a general exception approved by the
Committee, a Participant may not make more than six monthly investment
elections during a calendar year (treating each election that will
take effect on the same Change Date as one election). Notwithstanding
the foregoing, if the Committee approves procedures allowing elections
to be made more than one

-3-
<PAGE> 4
month in advance on an irrevocable basis, the future month specified
in any such advance election shall be substituted for the month in
which the election is made when determining the first of the following
month that is to be the Change Date for such election. All choices
implemented on behalf of a Participant on a Change Date are subject to
the completion of such forms and the satisfaction of such other
reasonable procedural requirements, with such reasonable advance
notice, as may be specified in the Plan or prescribed by the
Committee. As permitted by the Committee, such choices may be made by
telephone voice or touchtone response or by other appropriate means of
electronic data transmittal.

3. Effective as of January 1, 1990, the last sentence of subsection 5.1(a) of
the Plan is hereby deleted and the following is substituted in its place:

For this purposes, "Years of Employment" mean the total of the full
and fractional years (counting each completed calendar month as 1/12th
of a year) of employment with the Company or an Affiliate, as
determined from appropriate personnel records, provided that Years of
Employment for periods prior to January 1, 1990, shall continue to be
determined under the applicable Plan provisions that were in effect
when the determination was made. In addition, when the Company or
another Employer acquires a business entity or its assets, any
individuals working in that business who become Eligible Employees as
a result of the acquisition shall receive additional Years of
Employment corresponding to their service prior to the acquisition,
subject to the following conditions. The prior service credit shall
be consistent with the intent of the parties to the acquisition and
may include as Years of Employment hereunder, any prior service with
the acquired entity (or the former owner of the acquired assets) and
any other prior service that was recognized as eligibility or

-4-
<PAGE> 5
vesting service for them under a qualified plan of the acquired entity
or former asset owner, or an affiliate of such entity or owner,
provided that the Committee may deny prior service credit in counting
Years of Employment under the Plan and make other arrangements outside
the Plan instead if it deems this step is necessary to prevent
discrimination or to protect the qualification of the Plan for other
reasons. No prior service credit shall apply for acquisitions in
which the parties to the transaction do not intend it to be given.
The Committee shall ensure that appropriate records are kept to record
the identities of Participants who have received credit for past
service under this acquisition rule and the amount of their past
service credit.

4. Subsections 5.6(f) is hereby amended to read as follows, effective as of
June 1, 1993:

(f) Effective June 1, 1993, the former restrictions relating to
the ESOP Rollover Account are eliminated. Such restrictions
required all amounts attributable to a rollover from a
terminated tax credit employee stock ownership plan of a
former parent or affiliate of the Company to be held in a
separate ESOP Rollover Account and invested only in the
Company Stock Fund, and also imposed loan and withdrawal
limitations for the ESOP Rollover Account that did not apply
to other Accounts. Upon the elimination of such ESOP Rollover
Account restrictions, the Committee may require the ESOP
Rollover Account to continue as a separate Account that can be
invested and otherwise treated like any other Rollover
Account, or it may eliminate the separate ESOP Rollover
Account by transferring each Participant's balance in such
Account to his or her Rollover Account, in which case, any
references to the ESOP Rollover Account in other Plan sections
shall be construed as references to the Rollover Account.

-5-
<PAGE> 6
5. A new subsection 5.6(h) is hereby added to read as follows, effective as of
January 1, 1993:

(h) Notwithstanding the foregoing, on and after January 1, 1993, a
distribution or amount received, as used in this section shall
include an eligible rollover distribution described in Code
section 402(c)(4), and a transfer to this Plan pursuant to
this section shall include a direct rollover of an eligible
rollover distribution that is made in accordance with Code
section 401(a)(31) and the rules of this section.
Accordingly, in the case of any distribution occurring after
December 31, 1992, the rule in section 5.6(c)(3) relating to
partial distributions shall no longer apply, and the reference
in section 5.6(b) to "a qualified total distribution described
in Code section 402(a)(5)" shall be replaced by a reference to
"an eligible rollover distribution described in Code section
402(c)(4)." The Committee may establish additional rules and
procedures, consistent with the rules of the Code and related
regulatory guidance, concerning the acceptance of direct
rollovers and sixty-day rollovers of eligible rollover
distributions in this Plan, including rules that limit or
prohibit wire transfers and other payments that are made
directly to this Plan by another plan in lieu of giving the
Participant a check payable to the Trustee that the
Participant can deliver to a Plan representative.

6. Section 6.5 of the Plan is hereby amended by adding the following at the
end thereof, effective as of January 1, 1994:

Effective as of January 1, 1994, a new base year limitation of
$150,000 shall apply in accordance with Code section 401(a)(17), as
amended, and the annual limitation on the Compensation taken into
account for each Participant under the Plan for Plan Years beginning
after 1994 shall reflect such adjustments to the 1994 limitation of
$150,000 and such

-6-
<PAGE> 7
changes in Code section 401(a)(17) as may occur in the future and be
in effect from time to time. In the case of a short Plan Year or
other period of less than 12 months requiring a reduction of the Code
section 401(a)(17) annual limit, the otherwise applicable limit shall
be prorated by multiplying it by a fraction, the numerator of which is
the number of months in the short period and the denominator of which
is 12. Moreover, in implementing the Code section 401(a)(17) limit,
the rules of Code section 414(q)(6) (requiring the aggregation of
compensation paid to family members of certain five-percent owners and
the ten most highly compensated Employees) shall apply, except that in
applying such rules, the term "family" shall include only the spouse
of the Employee and any lineal descendants of the Employee who have
not attained age 19 before the close of the year. If, as a result of
the application of such rules, the adjusted annual Code section
401(a)(17) limit on compensation is exceeded, then (except for
determining the portion of compensation up to the integration level if
this Plan provides for permitted disparity), such limit shall be
prorated among the affected individuals in proportion to each such
individual's compensation as determined prior to the application of
the Code section 401(a)(17) limit.

7. A new section 7.12 is hereby added to the Plan, effective as of January 1,
1993, to read as follows:

7.12 Eligible Rollover Distributions. Eligible rollover
distributions from the Plan shall comply with the requirements of Code
section 401(a)(31) as follows. This section applies to distributions
made on or after January 1, 1993. Notwithstanding any provision of
the Plan to the contrary that would otherwise limit a distributee's
election under this section, a distributee may elect, at the time and
in the manner prescribed by the Committee, to have any portion of an
eligible rollover distribution paid directly to an eligible

-7-
<PAGE> 8
retirement plan specified by the distributee in a direct rollover.
For purposes of this section, the following definitions shall apply.

An "eligible rollover distribution" is any distribution of all or any
portion of the balance to the credit of the distributee, except that
an "eligible rollover distribution" does not include: any distribution
that is one of a series of substantially equal period payments (not
less frequently than annually) made for the life (or life expectancy)
of the distributee and the distributee's designated Beneficiary, or
for a specified period of ten years or more; any distribution to the
extent such distribution is required under section 401(a)(9) of the
Code; and the portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities); and
provided further that the determination of what constitutes an
"eligible rollover distribution" shall at all times be made in
accordance with the current rules of Code section 402(c), which shall
be controlling for this purpose.

An "eligible retirement plan" is an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, an annuity plan
described in section 403(a) of the Code, or a qualified trust
described in section 401(a) of the Code that accepts the distributee's
eligible rollover distribution. However, in the case of an eligible
rollover distribution to the surviving spouse, an "eligible retirement
plan" is an individual retirement account or individual retirement
annuity.

A "distributee" includes an Employee or former Employee. In addition,
the Employee's or former Employee's surviving spouse and the
Employee's or former Employee's spouse or former

-8-
<PAGE> 9
spouse who is the alternate payee under a qualified domestic relations
order, as defined in section 414(p) of the Code, are distributees with
regard to the interest of the spouse or former spouse.

A "direct rollover" is a payment by the Plan to the eligible
retirement plan specified by the distributee.

In prescribing the manner of making elections with respect to eligible
rollover distributions, as described above, the Committee may provide
for the uniform, nondiscriminatory application of any restrictions
permitted under applicable sections of the Code and related rules and
regulations, including a requirement that a distributee may not elect
a partial direct rollover in an amount less than $500 and a
requirement that a distributee may not elect to make a direct rollover
from a single eligible rollover distribution to more than one eligible
retirement plan. Moreover, if a distribution is one to which sections
401(a)(11) and 417 of the Code do not apply, such distribution may
commence less than 30 days after the notice required under section
1.411(a)-11(c) of the Income Tax Regulations is given, provided that:

(1) the Plan administrator clearly informs the
Participant that the Participant has a right to a
period of at least 30 days after receiving the notice
to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular
distribution option), and

(2) the Participant, after receiving the notice,
affirmatively elects a distribution.

8. Two new sections 8.7 is hereby added to the Plan to read as follows,
effective as of January 1, 1994:

-9-
<PAGE> 10
8.7 Compliance With ERISA Section 404(c). The Plan
provisions pertaining to Participant-directed investments are intended
to permit the Plan and Participant-directed transactions under it to
comply with requirements in ERISA section 404(c) and related
regulations so that a Participant will not be deemed to be a fiduciary
by reason of exercising control over assets in his Account, and no
person who is otherwise a fiduciary shall be liable, either for any
loss or by reason of any breach, which results from the exercise of
such control. For purposes of carrying out this intent, any Plan
reference to a Participant or Participants who exercise control over
Account assets shall be deemed to include a Beneficiary or
Beneficiaries who exercise such control, and any reference to a
specific Department of Labor regulation shall be deemed to include a
reference to any other currently applicable rule or regulation
pertaining to the same subject.

To comply with section 404(c) of ERISA and Department of Labor
regulation 2550.404(c)-1 thereunder, the Committee is designated as
the Plan fiduciary responsible for giving Participants all required
information, receiving and carrying out investment directions from
Participants, and giving Participants written confirmation of
instructions received from them. Accordingly, the Committee (or a
person or persons designated by the Committee to act on its behalf)
shall provide information to Participants in accordance with section
1(b)(2)(B) of the above Department of Labor regulation, shall receive
investment instructions provided by Participants in accordance with
this article of the Plan, and shall provide Participants with written
confirmation of such instructions. The Committee and any person or
persons it has designated to act on its behalf shall comply with all
such investment instructions from Participants except in cases where
the Committee declines to implement such instructions in accordance
with sections 1(b)(2)(ii)(B) and 1(d)(2)(ii) of the above Department
of Labor regulation.

-10-
<PAGE> 11
The Committee shall establish procedures to safeguard the
confidentiality of information relating to the purchase, sale,
holding, and exercise of voting and similar rights with respect to
Company Stock, provided that such procedures relating to
confidentiality shall not apply to the extent necessary to comply with
federal or state laws not preempted by ERISA, including any such laws
that may require certain Participants who are corporate officers or
large stockholders to report their transactions in Company Stock.
Where the Committee determines, in its discretion, that the situation
involves a potential for undue Employer influence upon Participants
with regard to their direct or indirect exercise of shareholder
rights, the Committee shall appoint an independent fiduciary who is
not affiliated with any sponsor of the Plan to carry out Plan
activities relating to Company Stock on behalf of Participants in such
situation.

9. Section 11.2 of the Plan is hereby amended to read as follows, effective as
of January 1, 1990:

11.2 Committee and Plan Expenses. Responsibility for the
general administration of the Plan and for carrying out the provisions
hereof shall be placed in a Committee of three or more members, each
of whom shall be an Employee of an Employer and each of whom shall be
appointed by the Chief Executive Officer of the Company and serve at
the pleasure of the latter. Any member of the Committee may resign by
notice in writing filed with the Secretary of the Committee, such
resignation to become effective no earlier than the date of such
written notice.

All costs and expenses that the Committee approves for payment by the
Plan after determining that they are necessary for the operation of
the Plan and reasonable in amount shall be paid from Plan assets. All
other expenses related to the operation of the Plan shall be paid by
the Company or another Employer.

-11-
<PAGE> 12
If the Plan pays recordkeeping fees, loan processing fees, or other
fees or expenses charged by a third-party provider for services to the
Plan pursuant to the first sentence of this paragraph, the payments
shall be accounted for in a manner acceptable to the Committee, which
may provide that such fees and expenses will be charged directly to
the Accounts of Participants and Beneficiaries to the extent that they
represent reasonable charges attributable to services performed with
respect to the Accounts being charged. The Committee may also provide
that such charges shall apply on a uniform, nondiscriminatory basis to
the Accounts of former Employees who have deferred their distributions
under the Plan, and shall not apply to the Accounts of Participants
who are still Employees. The members of the Committee shall not
receive compensation from the Plan for their services to the
Committee.

10. Except as amended above, the terms of the Plan as in effect prior to this
amendment shall continue unchanged.

Adopted, effective as indicated above, pursuant to section 12.1 of the Plan.

By: /s/ H. E. HAUNSCHILD
------------------------------
Harold E. Haunschild
Vice President-Human Resources
Burlington Resources Inc.

Date: May 9, 1994
------------------------------

ATTEST:

By: /s/ Margaret A. Salin
------------------------------

Date: May 9, 1994
----------------------------

-12-

<PAGE> 1
EXHIBIT 10.12

BURLINGTON RESOURCES INC.
PHANTOM STOCK PLAN
FOR
NON-EMPLOYEE DIRECTORS

Effective March 21, 1996

<PAGE> 2
BURLINGTON RESOURCES INC.
PHANTOM STOCK PLAN
FOR
NON-EMPLOYEE DIRECTORS

TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

SECTION 2 ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

SECTION 3 PARTICIPANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

SECTION 4 BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

SECTION 5 GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
</TABLE>

-i-
<PAGE> 3
BURLINGTON RESOURCES INC.
PHANTOM STOCK PLAN FOR
NON-EMPLOYEE DIRECTORS

PREAMBLE

WHEREAS, Burlington Resources Inc. (the "Company") desires to
establish the Burlington Resources Inc. Phantom Stock Plan For Non-Employee
Directors (the "Plan") in order for the Company to attract and retain highly
qualified individuals to serve as members of the Company's Board of Directors
by providing them with phantom stock in the Company;

NOW, THEREFORE, the Company does hereby adopt the Plan as set
forth herein, effective as of the 1996 Annual Meeting of the stockholders of
the Company.
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 Company means Burlington Resources Inc., a Delaware corporation.
<PAGE> 4
1.4 Company Stock Account means a notional account credited with Phantom Stock,
as provided in Section 4.2.

1.5 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-Consolidated
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.

1.6 Grant Date means the first business day following each Annual Meeting
of the stockholders of the Company ("Annual Meeting Date") that occurs
on or after the effective date of the Plan. For an individual who
first becomes a Participant other than on an Annual Meeting Date, the
initial Grant Date as to that Participant shall be the first business
day following the date the individual becomes a Participant.

1.7 Interest Account means a notional account credited with interest, as
provided in Section 4.4.

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

1.9 Participant means a member of the Board who is not also an employee of the
Company or a subsidiary thereof.

1.10 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.

-2-
<PAGE> 5
1.11 Plan means the Burlington Resources Inc. Phantom Stock Plan For
Non-Employee Directors as amended from time to time.

1.12 Termination means a Participant's ceasing to be a member of the Board.

SECTION 2

ADMINISTRATION

2.1 Management Committee. The Plan shall be administered
by a management committee (the "Management Committee") consisting of such
officers 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, determine the 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.

SECTION 3

PARTICIPANTS

3.1 Participants. Each member of the Board who is not an
employee of the Company or a subsidiary thereof shall automatically be a
Participant.

SECTION 4

BENEFITS

4.1 Automatic Phantom Stock Grants. On each Grant Date
each Participant on such date shall have credited to his Company Stock Account
500 shares of Phantom Stock.

-3-
<PAGE> 6

A separate Company Stock Account shall be established for each Participant with
respect to each Grant Date; provided, however, that all Company Stock 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
Company Stock Account.

4.2 Payment Elections. Prior to each Grant Date a
Participant may elect to have all or a portion of the shares of Phantom Stock
that are to be granted to the Participant on such Grant Date be paid in one of
the forms specified in Section 4.4 following the Participant's Termination. The
payment election shall be irrevocable, shall apply only to the grant applicable
to that specified Grant Date and shall be made on a form prescribed by the
Management Committee. If a Participant does not make a payment election with
respect to a specified Grant Date, the Phantom Stock granted to the Participant
on that Grant Date shall be paid following his or her Termination in the same
manner as provided in the last election made by the Participant for a grant
under the Plan prior to that Grant Date and, if no election has ever been made,
then in a lump sum in accordance with Section 4.4 as if the Participant had
elected such option.

4.3 Investment of Accounts. A Participant's Company
Stock Account(s) shall be credited with the shares of Phantom Stock granted as
of the applicable Grant Dates, and with phantom (notional) dividends with
respect to the Phantom Stock, which shall be credited as being reinvested in
additional shares of Phantom Stock. All credits and debits to a Company Stock
Account shall be made based on the Fair Market Value per share of the Company's
common stock on the applicable date.

-4-

<PAGE> 7

4.4 Payment of Accounts. Except as provided below, upon
a Participant's Termination the Company shall pay to such Participant (or to
Participant's death) an amount in cash equal to the balance then credited to
his or her Company Stock 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 (or deemed elected) by the
Participant. However, if a Participant has elected to receive the distribution
of a Company Stock Account in installments, such Company Stock Account shall be
automatically converted into an Interest Account as of the Participant's date
of Termination. Each Interest Account shall accrue interest on the balance
credited to such Interest Account from the date of Termination through the date
of its distribution. 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.

Payment of Accounts shall commence or be made in the January
following the year in which the Participant's Termination occurs.

Notwithstanding anything in the Plan to the contrary, if the
Management Committee determines at any time that Participants may be given the
ability to change their election as to the distribution of their Company Stock
Account(s) without causing the loss of any exempt treatment to "insiders"
subject to the provisions of Section 16 of the Securities Exchange

-5-

<PAGE> 8

Act of 1934, as amended, the Management Committee may amend the Plan to provide
for such election changes as it deems appropriate.

4.5 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 death, 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-
<PAGE> 9
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
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.

-7-

<PAGE> 10

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 Termination and Amendment. 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 Board 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, 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. Notwithstanding
the foregoing, the Plan may not be amended more than once every six months,
other than to comport with changes in the Internal Revenue Code, the Employee
Retirement Income Security Act of 1974, or the rules thereunder.

5.5 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

-8-

<PAGE> 11

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.

5.6 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.

-9-

<PAGE> 1

EXHIBIT 10.23

BURLINGTON RESOURCES INC.

$600,000,000

AMENDED AND RESTATED

LONG-TERM REVOLVING CREDIT AGREEMENT

Dated as of

July 14, 1995

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

<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01. Certain Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
---------------------
SECTION 1.02. Computation of Time Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
---------------------------
SECTION 1.03. Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
----------------

ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01. The A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
--------------
SECTION 2.02. Making the A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
---------------------
SECTION 2.03. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
----
SECTION 2.04. Reduction of the Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
----------------------------
SECTION 2.05. Repayment of A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
-----------------------
SECTION 2.06. Interest on A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
----------------------
SECTION 2.07. Additional Interest on Eurodollar Rate Advances . . . . . . . . . . . . . . . . . . . . . . . 17
-----------------------------------------------
SECTION 2.08. Interest Rate Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
---------------------------
SECTION 2.09. Voluntary Conversion of A Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
----------------------------------
SECTION 2.10. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
-----------
SECTION 2.11. Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
---------------
SECTION 2.12. Increased Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
-----------------
SECTION 2.13. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
----------
SECTION 2.14. Payments and Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
-------------------------
SECTION 2.15. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
-----
SECTION 2.16. Sharing of Payments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
------------------------
SECTION 2.17. Evidence of Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
----------------
SECTION 2.18. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
---------------
SECTION 2.19. The B Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
--------------
SECTION 2.20. Increase of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
-----------------------

ARTICLE III
CONDITIONS OF EFFECTIVENESS AND LENDING

SECTION 3.01. Conditions Precedent to Effectiveness of this Agreement . . . . . . . . . . . . . . . . . . . 33
-------------------------------------------------------
SECTION 3.02. Conditions Precedent to Each A Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . 33
----------------------------------------
SECTION 3.03. Conditions Precedent to Each B Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . 34
----------------------------------------

ARTICLE IV
REPRESENTATIONS AND WARRANTIES
</TABLE>
<PAGE> 3
<TABLE>
<S> <C> <C>
SECTION 4.01. Representations and Warranties of the Borrower . . . . . . . . . . . . . . . . . . . . . . . 35
----------------------------------------------

ARTICLE V
COVENANTS OF THE BORROWER

SECTION 5.01. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
---------------------
SECTION 5.02. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
------------------
SECTION 5.03. Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
----------------------

ARTICLE VI
EVENTS OF DEFAULT

SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
-----------------

ARTICLE VII
THE AGENT

SECTION 7.01. Authorization and Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
------------------------
SECTION 7.02. Agent's Reliance, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
---------------------
SECTION 7.03. Citibank and Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
-----------------------
SECTION 7.04. Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
----------------------
SECTION 7.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
---------------
SECTION 7.06. Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
---------------

ARTICLE VIII
MISCELLANEOUS

SECTION 8.01. Amendments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
---------------
SECTION 8.02. Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
-------------
SECTION 8.03. No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
-------------------
SECTION 8.04. Costs and Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
-----------------------------
SECTION 8.05. Right of Set-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
----------------
SECTION 8.06. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
--------------
SECTION 8.07. Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
------------------------------
SECTION 8.08. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
---------------
SECTION 8.09. Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
-----------------------
SECTION 8.10. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
-------------
SECTION 8.11. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
-------------------------
</TABLE>

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<PAGE> 4
<TABLE>
<S> <C>
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 Jones, Day, Reavis & Pogue,
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
</TABLE>

-iii-
<PAGE> 5
AMENDED AND RESTATED
LONG-TERM REVOLVING CREDIT AGREEMENT

Dated as of July 14, 1995

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:

PRELIMINARY STATEMENTS

1. The Borrower, the Agent and certain Lenders are parties to the
Long-Term Revolving Credit Agreement dated as of July 20, 1994 (the "1994
Credit Agreement") pursuant to which such Lenders committed to make Advances
(as such term is defined in the 1994 Credit Agreement) to the Borrower on the
terms and conditions set forth therein.

2. The parties hereto have agreed to amend (effective as of July
14, 1995) the definition of "Termination Date" and Sections 2.19, 3.01 and 4.01
of, and Exhibits A through K to, the 1994 Credit Agreement and, as so amended,
to restate it in its entirety and the Lenders and the Agent have agreed to do
so on the terms and conditions set forth herein.

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
<PAGE> 6
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 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.

"Agreement" means the 1994 Credit Agreement (defined above),
as amended and restated by this Amended and Restated Long-Term
Revolving Credit Agreement, together with all exhibits and schedules
hereto, as may be amended or otherwise modified from time to time
pursuant to the terms hereof.

"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

-2-
<PAGE> 7
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 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

-3-
<PAGE> 8
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

"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

-4-
<PAGE> 9
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 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 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.

-5-
<PAGE> 10
"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 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 for any date the percentage per
annum applicable on such date as set forth in the row labelled "LIBOR
Applicable Margin" on Schedule III hereto, which is based on the
ratings (or lack thereof) by Moody's or S&P or both of the public
long-term senior unsecured debt securities of the Borrower.

-6-
<PAGE> 11
"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 for any date the percentage
per annum applicable on such date as set forth in the row labelled
"Facility Fee" on Schedule III hereto, which is based on the ratings
(or lack thereof) by Moody's or S&P or both of the public long-term
senior unsecured debt securities of the Borrower.

"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 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.

-7-
<PAGE> 12
"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 or twelve 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 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

-8-
<PAGE> 13
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.

"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 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.

"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

-9-
<PAGE> 14
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).

"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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<PAGE> 15
(e) conventional provisions contained in any contracts or
agreements affecting properties under which the Borrower or a
Subsidiary of the Borrower is required immediately before the
expiration, termination or abandonment of a particular property to
reassign to the 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.

"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.

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<PAGE> 16
"Short-Term Revolving Credit Agreement" means the Short-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.

"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.

"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.

"Termination Date" means the earlier of (i) July 20, 2000 and
(ii) the date of termination in whole of the Commitments pursuant to
Section 2.04 or 6.01.

"Termination Event" means (i) a "reportable event," as such
term is described in Section 4043 of ERISA (other than a "reportable
event" not subject to the provision for 30-day notice to the PBGC), or
an event described in Section 4062(e) of ERISA, or (ii) the withdrawal
of the Borrower or any ERISA Affiliate from a Multiple Employer Plan
during a plan year in which it was a "substantial employer," as such
term is defined in Section 4001(a)(2) of ERISA, or the incurrence of
liability by the Borrower 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.

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<PAGE> 17
"Type" has the meaning specified in the definition of "A
Advance".

"Utilization Fee Percentage" means for any date the percentage
per annum, if any, applicable on such date as set forth in the row
labelled "Utilization Fee" on Schedule III hereto, which is based on
the ratings (or lack thereof) by Moody's or S&P or both of the public
long-term senior unsecured debt securities of the Borrower.

"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, 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

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<PAGE> 18
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 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

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<PAGE> 19
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 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
in effect from time to time.

(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.

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(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.

(d) Utilization Fee. The Borrower agrees to pay to each
Lender (other than a Designated Bidder) a utilization fee on the average daily
aggregate amount of the A Advances owing to such Lender and outstanding from
time to time at a rate per annum equal to the Utilization Fee Percentage in
effect from time to time, payable quarterly in arrears on the last day of each
March, June, September and December, beginning September 30, 1994, and on the
Termination Date; provided, however, that no utilization fee shall be payable
with respect to any quarter or portion thereof for which the utilization fee
would otherwise be payable by the Borrower in accordance with the foregoing
provisions of this subsection (d) if the average daily aggregate amount of
Advances owing to all the Lenders and outstanding from time to time during such
quarter or portion is equal to or less than 50% of the average daily aggregate
amount of the Commitments (used and unused) of all the Lenders during such
quarter or portion.

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 $20,000,000 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 Termination Date 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).

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<PAGE> 21
(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 in effect from time to time, 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.

(b) Default Interest. The Borrower shall pay interest on the
unpaid principal amount of each Advance that is not paid when due (whether at
stated maturity, by acceleration or otherwise) from the date on which such
amount is due until such amount is paid in full, payable on demand, at a rate
per annum equal at all times (i) from such due date to the last day of the then
existing Interest Period therefor, in the case of each Eurodollar Rate Advance,
to 1% per annum above the interest rate per annum required to be paid on such 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

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<PAGE> 22
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).

(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,

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(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 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

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<PAGE> 24
Conversion is into Eurodollar Rate Advances, the duration of the Interest
Period for each such Eurodollar Rate Advance.

SECTION 2.10. Prepayments. The Borrower may, upon (i) in the
case of Eurodollar Rate Advances, at least two Business Days notice or (ii) in
the case of Base Rate Advances, telephonic notice not later than 12:00 noon
(New York City time) on the date of prepayment, to the Agent which specifies
the proposed date and aggregate principal amount of the prepayment and the Type
of A Advances to be prepaid, and 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

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in this Section 2.11(a)). A certificate as to the amount of such 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.

SECTION 2.12. Increased Capital. If either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) compliance by any Lender with any guideline or request from
any central bank or other governmental authority (whether or not having the
force of law) affects or would affect the amount of capital required or
expected to be maintained by such Lender or any corporation controlling such
Lender and such Lender determines that the amount of such capital is increased
by or based upon the existence of such Lender's commitment to lend hereunder
and other commitments of this type, then, within ten days after demand, and
delivery to the Borrower of the certificate referred to in the last sentence of
this Section 2.12 by such Lender (with a copy of such demand to the Agent), the
Borrower shall pay to the Agent for the account of such Lender, from time to
time as specified by such Lender, additional amounts sufficient to compensate
such Lender or such corporation in the light of such circumstances, to the
extent that such 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

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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.

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

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<PAGE> 27
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 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 and utilization 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 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 or utilization 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

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<PAGE> 28
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.

(a) Any and all payments by the Borrower hereunder or under
the Notes shall be made in accordance with Section 2.14, free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding in the case of each Indemnified Party, (i) all taxes, levies,
imposts, deductions, charges, or withholdings, and all liabilities with respect
thereto, imposed on or determined by reference to its income, and all franchise
taxes, and (ii) all other taxes, levies, imposts, deductions, charges, or
withholdings in effect at the time that such Indemnified Party executed this
Agreement or otherwise became an "Indemnified Party" hereunder, and liabilities
with respect 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

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<PAGE> 29
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, 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.

(d) On or prior to the date on which each Indemnified Party
organized under the laws of a jurisdiction outside the United States executes
this Agreement or otherwise becomes an "Indemnified Party" hereunder, such
Indemnified Party shall provide the Borrower and the Agent with U.S. Internal
Revenue Service form 1001 or 4224, as appropriate, or any successor form
prescribed by the U.S. Internal Revenue Service, certifying that such
Indemnified Party is fully exempt from United States withholding taxes with
respect to all payments to be made to such Indemnified Party hereunder, or
other documents satisfactory to the Borrower indicating that all payments

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<PAGE> 30
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.

SECTION 2.16. Sharing of Payments, Etc. If any Lender shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the A Advances made by it (other
than pursuant to Section 2.07, 2.11, 2.12, 2.13, 2.15 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

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<PAGE> 31
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.

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) June 15, 2000, 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

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<PAGE> 32
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) July 15, 2000), 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.

(ii) Each Lender may, if in its sole and absolute discretion it
elects to do so, irrevocably offer to make one or more B Advances to
the Borrower as part of such proposed B Borrowing at a rate or rates
of interest specified by such Lender in its sole discretion, by
notifying the Agent (which shall give prompt notice 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.

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<PAGE> 33
(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

B. accept one or more of the offers made by any
Lender or Lenders pursuant to paragraph (ii) above, in order
of the lowest to highest rates of interest or margins (or, if
two or more Lenders bid at the same rates of interest, and the
amount of accepted offers is less than the aggregate amount of
such offers, the amount to be borrowed from such 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

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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 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.

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(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.

(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 $800,000,000 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 $200,000,000, (b) any Increase in
Commitments pursuant to this Section 2.20 shall be in the amount of $20,000,000
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 $20,000,000, (f)
simultaneously 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 Short-Term

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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 Short-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 Short-Term Revolving Credit
Agreement pursuant to Section 2.20 thereof with a "Commitment" (under and as
defined in the Short-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
Short-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 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.

ARTICLE III
CONDITIONS OF EFFECTIVENESS AND LENDING

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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 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.

(e) A favorable opinion of Jones, Day, Reavis & Pogue, 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.

SECTION 3.02. Conditions Precedent to Each A Borrowing. The
obligation of each Lender to make an A Advance (including the initial A
Advance) on the occasion of any A Borrowing shall be subject to the further
conditions precedent that on or before the date of such A Borrowing this
Agreement shall have become effective pursuant to Section 3.01 and that on the
date of such A Borrowing, before and

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immediately after giving effect to such A Borrowing and to the 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 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:

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(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 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,

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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, 1994 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, 1995 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, 1995 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

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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).

(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

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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.

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

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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
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

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used in the 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:

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;

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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 Short-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

(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

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<PAGE> 46
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, 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

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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.

(e) Dividend Restrictions. Create, or consent or agree to,
or permit any of its Material Subsidiaries existing on the date hereof
or any of its Subsidiaries hereafter created or acquired and owning a
material portion of the consolidated operating assets existing at 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

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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 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 benefit plans
and to registration statements of securities for selling security
holders;

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<PAGE> 49
(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;

(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

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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

(c) The Borrower shall fail to perform or observe any other
term, covenant or agreement contained in this 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

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<PAGE> 51
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

(e) (i) The Borrower or any Material Subsidiary shall (A)
generally not pay its debts as such debts become due; or (B) admit in
writing its inability to pay its debts generally; or (C) make a
general assignment for the benefit of creditors; or (ii) any
proceeding shall be instituted or consented to by the Borrower or any
such 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

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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 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

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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, 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 Short-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 Lender prompt notice of each notice given to it by the
Borrower pursuant to the terms of this Agreement.

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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 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.

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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 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.

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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 or utilization fees hereunder,
(d) postpone any date fixed for any payment of principal of, or interest on,
the A Notes or any facility fees or utilization 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, 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

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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 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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(c) The Borrower agrees to indemnify and hold harmless the
Agent, the Arranger and each Lender from and against any and all claims,
damages, liabilities and expenses (including, without limitation, fees and
disbursements of counsel) which may be incurred by or asserted against the
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.

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

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Advances, any B Advances or any B Notes), and the same constant percentage of
all rights and obligations of such assigning Lender under the Short-Term
Revolving Credit Agreement, unless the Short-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 Short-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 Short-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 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

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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 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.

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(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, 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

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information contained therein in the Register and (iii) give prompt notice
thereof to the Borrower.

(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 or
utilization 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 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.

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(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 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

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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.

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:
------------------------
Name:
----------------------
Title:
---------------------

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CITIBANK, N.A., as Agent