BENTON OIL & GAS CO, S-3, 1996-01-10

BENTON OIL & GAS CO
S-3, 1996-01-10
CRUDE PETROLEUM & NATURAL GAS

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<PAGE> 1

As filed with the Securities and Exchange Commission on January 10, 1996
Registration No. 33-___________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form S - 3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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BENTON OIL AND GAS COMPANY
(Exact name of registrant as specified in charter)

Delaware 77-0196707
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)

1145 Eugenia Place A.E. Benton, C.E.O.
Suite 200 1145 Eugenia Place
Carpinteria, California 93013 Suite 200
(805) 566-5600 Carpinteria, California 93013
(Address, including zip code, and (805) 566-5600
telephone number, including area code, (Name, address, including zip code,
of registrant's principal executive and telephone number, including
offices) area code, of agent for service)

-----------------------------------
Copies to:
Jack A. Bjerke
Emens, Kegler, Brown, Hill & Ritter Co., L.P.A.
65 East State Street, Suite 1800
Columbus, Ohio 43215
(614) 462-5400

Approximate date of commencement of proposed sale to public: From time
to time after the effective date of this Registration Statement.

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]

If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [x]

If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If delivery of the Prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
=======================================================================================================================
Title of each Class of Securities Amount to be Proposed Maximum Proposed Maximum Amount of to
to be Registered Registered(1) Offering Price Per Aggregate Offering Registration Fee
Share(2) Price(2)
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<S> <C> <C> <C> <C>
Common Stock, $.01 par value 348,500 $14.50 $5,053,250 $1,743
=======================================================================================================================

</TABLE>

<PAGE> 2
1. The shares to be registered hereunder are issuable by the Company upon
the exercise of certain outstanding warrants which, pursuant to the
terms of the Warrant Agreements, were not exercisable until one
year from from the date of issuance of the Warrants.

2. Estimated pursuant to paragraphs (c) and (g) of Rule 457 promulgated
under the Securities Act of 1933, as amended, solely for purposes of
calculating the registration fee, based upon the average of the high
and low sale prices at which shares of Common Stock were sold on
January 8, 1996 on the NASDAQ National Market.

The Registrant hereby amends that this registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until the Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
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<PAGE> 3
Subject to Completion
January 10, 1996
348,500 Shares

BENTON OIL AND GAS COMPANY
COMMON STOCK

This Prospectus relates to the offering of an aggregate of 348,500 shares of
Common Stock, $.01 par value, of Benton Oil and Gas Company (the "Company"),
offered to and for the account of certain stockholders of the Company (the
"Selling Stockholders"). The shares are issuable by the Company upon the
exercise of certain outstanding warrants (the "Warrants") issued to partners of
the Benton Oil & Gas Private Drilling Partnership 1989-3, L.P. and the Benton
Oil & Gas Private Drilling Partnership 1990-1, L.P. (collectively, the
"Partnerships") upon dissolution of the Partnerships. Pursuant to the terms of
the Warrants, the Warrants were not exercisable until one year after the date of
issuance of the Warrants. This Prospectus is to be used for the offer and
issuance of shares of Common Stock upon the exercise of the Warrants (the
"Shares") and for the public resale of the Shares so issued by the Selling
Stockholders. The Company will receive an aggregate of $3,485,000, assuming all
Warrants are exercised. The Company will not receive any proceeds from the sale
of the Shares offered by the Selling Stockholders. See "Use of Proceeds,"
"Selling Stockholders" and "Plan of Distribution."

The Shares may be sold from time to time by the Selling Stockholders, or by the
pledgees, transferees or other successors in interest. Such sales may be made
on the NASDAQ National Market or in the over-the-counter market, or otherwise
at prices and at terms then prevailing or at prices related to the then
current market price, or in negotiated transactions. The Shares may be sold by
one or more of the following: (a) a block trade in which the broker or dealer
so engaged will attempt to sell the Shares as agent but may position and resell
a portion of the block as principal to facilitate the transaction; (b)
purchases by a broker or dealer as principal and resale by such broker or
dealer for its account pursuant to this Prospectus; (c) an exchange transaction
in accordance with the rules of such exchange; (d) ordinary brokerage
transactions and transactions in which the broker solicits purchasers; and (e)
secondary distributions. In effecting sales, brokers or dealers engaged by the
Selling Stockholders may arrange for other brokers or dealers to participate.
Brokers or dealers will receive commissions or discounts from the Selling
Stockholders in amounts to be negotiated immediately prior to the sale and
which are not expected to exceed those customary in the type of transactions
involved. Such brokers or dealers and any other participating brokers or
dealers acting for the Selling Stockholders may be deemed to be "underwriters'
within the meaning of the Securities Act of 1933, as amended (the "Act") in
connection with such sales, and any commissions, discounts, concessions or
profits received by them may be deemed to be underwriting compensation under
the Act.

The Shares are being offered by the Company and the Selling Stockholders
without any underwriting discounts or commissions.

All expenses of registration of the Shares, estimated to be approximately
$14,000, shall be borne by the Company. Normal commission expenses and
brokerage fees, as well as the fees of counsel to the Selling Stockholders, if
any, and any applicable transfer taxes, are payable individually by the Selling
Stockholders.

On January 8, 1996 the last sale price of the Company's Common Stock on
NASDAQ National Market was $14.50 per share.

SEE "RISK FACTORS" AT PAGE 9 FOR INFORMATION THAT SHOULD BE CONSIDERED BY
PROSPECTIVE PURCHASERS.

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

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<TABLE>
<CAPTION>
Underwriting Discounts
Price to Public(1) and Company Proceeds to Company
<S> <C> <C> <C>
Per $10.00 $0 $10.00
Share..................... $3,485,000 $0 $3,485,000
Total(2)..................
<FN>
(1) Represents exercise price of Warrants.
(2) Assumes that all warrants are exercised.
</FN>
</TABLE>
The date of this Prospectus is __________, 1996

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AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and, in accordance therewith, files
reports and other information with the Commission. Reports, proxy statements
and other information statements filed by the Company with the Commission
pursuant to the informational requirements of the Exchange Act may be inspected
and copied at the public reference facilities maintained by the Commission, at
Room 1024, Judiciary Plaza Building, 450 Fifth Street, N.W., Washington, D.C.
20549, and the following regional offices of the Commission: 7 World Trade
Center, New York, New York 10048 and 500 West Madison Street, 14th Floor,
Chicago, Illinois 60661. Copies of such material may be obtained at prescribed
rates from the Public Reference Section of the Commission at Room 1024,
Judiciary Plaza Building, 450 Fifth Street, N.W., Washington, D.C. 20549.

The Company has filed with the Commission a Registration Statement on Form S-3
(the "Registration Statement") under the Securities Act with respect to the
Securities. This Prospectus, filed as part of the Registration Statement, does
not contain all the information set forth in the Registration Statement and the
exhibits and schedules thereto, certain portions of which have been omitted in
accordance with the rules and regulations of the Commission. For further
information with respect to the Company and the Securities, reference is made
to the Registration Statement and to the exhibits and schedules thereto, which
may be inspected at the Commission's offices without charge or copies of which
may be obtained from the Commission upon payment of the prescribed fees.
Statements made in the Prospectus as to the contents of any contract, agreement
or document referred to are not necessarily complete, and in each instance,
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement, and each such statement is qualified in
its entirety by such reference.

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

The following documents, heretofore filed by the Company with the Securities
and Exchange Commission (the "Commission") pursuant to the Exchange Act, are
hereby incorporated by reference, except as superseded or modified herein (i)
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1994, as amended by Forms 10-K/A on May 2, 1995 and July 11, 1995; (ii) the
Company's Current Report on Form 8-K filed April 17, 1995; (iii) the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1995; (iv) the
Company's Current Report on Form 8-K filed May 31, 1995; (v) the Company's
Registration Statement on Form 8-A filed on May 4, 1995, effective May 19,
1995; (vi) the Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1995; (vii) the Company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1995;(viii) the Company's Current Report on Form
8-K filed January 8, 1996 and (ix) the description of Common Stock contained in
the Company's Registration Statements and amendments filed pursuant to the
Exchange Act on March 17, 1989, May 14, 1991 and May 15, 1992.

Each document filed subsequent to the date of this Prospectus pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to the
termination of the offering shall be deemed to be incorporated by reference in
this Prospectus and shall be part hereof from the date of filing of such
document. Any statement contained in the documents incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained in this Prospectus or in
any other subsequently filed document that also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of the Prospectus.

The Company undertakes to provide, without charge, to each person, including
any beneficial owner, to whom a copy of this Prospectus is delivered, upon
written or oral request of such person, a copy of any and all of the documents
or information referred to above that has been or may be incorporated by
reference in this Prospectus (excluding exhibits to such documents unless such
exhibits are specifically incorporated by reference). Requests should be
directed to Benton Oil and Gas Company, 1145 Eugenia Place, Suite 200,
Carpinteria, California 93013 (the principal executive offices of the Company),
telephone (805) 566-5600, Attn: Corporate Secretary.

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<PAGE> 6
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
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<S> <C>
AVAILABLE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE . . . . . . . . . . . . . . . . . . . . . . . . . . 5
PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SELLING STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
</TABLE>

No person has been authorized to give any information or make any
representation other than those contained in this Prospectus, and, if given or
made, such information or representation must not be relied upon as having been
authorized by the Company or by any underwriter, agent or dealer. This
Prospectus does not constitute an offer to sell, or a solicitation of an offer
to buy, the securities registered hereby in any jurisdiction to any person to
whom it is unlawful to make such offer or solicitation. Neither the delivery of
this Prospectus nor any sale made hereunder shall, under any circumstances,
create any implication that there has been no change in the affairs of the
Company since the date hereof.

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PROSPECTUS SUMMARY

The following summary should be read in conjunction with, and is qualified in
its entirety by, the more detailed information and Consolidated Financial
Statements and related notes thereto appearing elsewhere in this Prospectus or
incorporated herein by reference. See the Glossary included elsewhere in this
Prospectus for definitions of certain oil and gas terms. Unless the context
otherwise requires or as otherwise specified herein, all references to the
"Company" refer to Benton Oil and Gas Company and its subsidiaries.

THE COMPANY

Benton Oil and Gas Company is primarily engaged in the development and
production of oil and gas properties. The Company's operations are focused in
the eastern region of Venezuela, the Gulf Coast region of Louisiana and the
West Siberia region of Russia. At December 31, 1994, the Company's Proved
Reserves of 81.2 MMBOE consisted of 78.5 MMBbl of oil and 16.1 Bcf of natural
gas. The Company's Proved Reserves, net of production, have increased from 14.8
MMBOE at December 31, 1990 to 81.2 MMBOE through purchases of
reserves-in-place, awards of development contracts, the acquisition of an
additional equity interest in the Company's Venezuelan subsidiary,
discoveries of oil and natural gas reserves, extensions of existing producing
fields and revisions of previously estimated reserves. The Standardized Measure
of Discounted Future Net Cash Flows, Before Provision for Income Taxes,
relating to the Company's Proved Reserves at December 31, 1994 was
approximately $336.3 million.

BUSINESS STRATEGY

The Company's business strategy is to operate in niche markets where it can
further develop existing oil and gas fields and seek new reserves in areas of
low geologic risk. The Company implements this strategy through the in-house
design and interpretation of 3-D Seismic surveys, combined with well
recompletions and exploration and development drilling. The Company believes
that because of its concentration on 3-D Seismic technology and the training
and qualifications of its management and technical team, the Company has gained
access to projects it otherwise would not have enjoyed and has a competitive
advantage in finding and developing reserves on an economic basis. The
Company's Finding Costs for its Proved Reserves from inception to December 31,
1994 were $1.35 per BOE. The Company's estimate of Future Development Costs for
its non-producing Proved Reserves at December 31, 1994 was $1.23 per
BOE, which the Company believes continues to give it a competitive advantage in
finding and developing reserves.

In the U.S., the Company integrates 3-D Seismic technology with
subsurface geologic data from previously drilled wells. This geophysical
evaluation enables the Company to identify previously undetected reserves in
existing fields. Internationally, the Company seeks participation in projects
with significant reserve potential in areas with low geologic risk and known
Proved Reserves where, in certain situations, the company can add value by
employing modern exploration, drilling, completion and production techniques.
The Company has formed ventures with local foreign partners in an effort to
reduce risk, control costs, and facilitate local transactions. The Company
continues to evaluate joint venture opportunities with domestic and foreign
partners to implement its business strategy.

VENEZUELAN OPERATIONS

Approximately 75% of the Company's Proved Reserves are located in Eastern
Venezuela in the Uracoa, Bombal and Tucupita Fields in the South Monagas Unit.
In July 1992, the Company, together with a Venezuelan construction and
engineering company, Venezolana de Inversiones y Construcciones Clerico, C.A.
("Vinccler"), entered into an operating service agreement with Lagoven, S.A.
("Lagoven"), an affiliate of the national oil company, Petroleos de Venezuela,
S.A. ("PDVSA") to reactivate and further develop the three Venezuelan oil
fields. The Company was the first U.S. company to be awarded an oil field
development and production contract in Venezuela since that country's oil field
reactivation program was announced in 1991. Under the terms of the

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contract, Benton-Vinccler, C.A., the Company's 80% owned subsidiary
("Benton-Vinccler"), is a contractor for Lagoven. Benton-Vinccler receives an
operating fee in U.S. dollars for each Bbl of crude oil produced (subject to
periodic adjustments to reflect changes in the special energy index of the U.S.
Consumer Price Index) and will be reimbursed in U.S. dollars for its capital
expenditures, provided such operating fee and capital recovery fee cannot
exceed the maximum dollar amount per Bbl set forth in the agreement (which
amount will be periodically adjusted to reflect changes in the average of
certain world crude oil prices). For the year ended December 31, 1994, the
average operating fee received by Benton-Vinccler pursuant to the operating
services agreement was $8.52 per Bbl. The Venezuelan government maintains full
ownership of all hydrocarbons in the Fields. Production commenced in the Uracoa
Field during the second quarter of 1993. Production levels have steadily
increased, due largely to the use of modern drilling, completion and production
techniques. As of the date of this Prospectus, 45 wells in the Field are
producing an aggregate of approximately 24,000 Bbl of oil per day.
Benton-Vinccler intends to completely develop the Uracoa Field by drilling
approximately 100 wells and intends to subsequently reactivate the Bombal
Field.

UNITED STATES OPERATIONS

Approximately 4% of the Company's Proved Reserves are located in the United
States. Substantially all of the Company's domestic activities are located in
the Louisiana Gulf Coast at the West Cote Blanche Bay, Rabbit Island and Belle
Isle Fields. The Company has successfully pursued acquisition and joint venture
opportunities in the United States, which have become more readily available as
major oil and gas companies continue to consolidate operations and focus
exploration and development activities outside the United States.
The Company has formed joint ventures with Texaco, Inc. ("Texaco") and Oryx
Energy Company ("Oryx") in the Gulf Coast, in which the Company conducts a 3-D
Seismic survey and/or development program in exchange for an interest in a
field or project area or the right to drill future wells as a working interest
partner.

The Company, Texaco and Oryx are currently producing from and further
developing the fields by using 3-D Seismic technology integrated with
subsurface geologic data from previously drilled wells. The Company has
identified multiple pay zones, including lower risk shallow and medium depth
prospects and selected higher risk exploratory prospects, in all three fields.
In addition, the Company entered into certain agreements with Tenneco Ventures
Corporation ("Tenneco") relating to certain present and future exploration and
development activities in the Gulf Coast. This relationship will facilitate
increased flexibility and diversification in the Company's operations in the
region.

In March 1995, the Company and its affiliates and Tenneco sold to WRT Energy
Corporation a 43.75% working interest in the shallower depths (above
approximately 10,575 feet) in the West Cote Blanche Bay Field in Louisiana
for an aggregate purchase price of $20 million. Of this aggregate purchase
price, the Company received $14.9 million.

RUSSIAN OPERATIONS

Approximately 21% of the Company's Proved Reserves are located in the North
Gubkinskoye Field in the West Siberia region of Russia. The Company's Russian
operations are conducted through GEOILBENT, Ltd. ("GEOILBENT"), a joint venture
comprised of the Company (34%), Purneftegas (33%), and Purneftegasgeologia
(33%). The Company's partners are the Russian state agencies which control
exploration, delineation, and development of oil and gas fields in this part of
the Western Siberian Basin. The joint venture, which has been registered with
the Ministry of Finance of the Russian Republic, develops, produces and markets
oil and condensate from the North Gubkinskoye Field. This Field, which has been
delineated and tested, is surrounded by other large proven fields, a number of
which are now being developed by major international oil and gas companies. In
1993, GEOILBENT completed the construction of a 37 mile crude oil pipeline from
the North Gubkinskoye Field to the Russian oil pipeline network and commenced a
multi-well drilling program in the Field. The ultimate development of the Field
is expected to involve several phases and the drilling of more than 350 wells.
Production from the Field commenced during the third quarter of 1993. As of the
date of this Prospectus, the Field is producing approximately 8,000 Bbl of oil
per day. GEOILBENT commenced exporting oil during the fourth quarter of 1993
and its production is being sold for U.S. dollars.

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RISK FACTORS

In addition to the other information contained in this Prospectus, investors
should carefully consider the following factors in connection with an
investment in the Shares:
RISKS RELATED TO THE COMPANY

LOSSES FROM OPERATIONS

The historical financial data for the Company reflect net losses of $2,908,335
and $4,828,590 for the years ended December 31, 1992 and 1993, respectively,
and net income of $2,954,161, $1,827,660 and $6,055,975 for the year ended
December 31, 1994 and the nine months ended September 30, 1994 and 1995,
respectively. The Company had total revenues of $8,622,109, $7,503,796 and
$34,704,806 for the years ended December 31, 1992, 1993 and 1994, respectively,
and $21,733,123 and $44,160,267 for the nine months ended September 30, 1994
and 1995, respectively. The decreased revenues for the year ended December 31,
1993 compared to the year ended December 31, 1992 was due in part to the sale
by the Company of certain non-strategic oil and gas properties. During 1993,
the Company made a significant amount of capital expenditures for infra-
structure, such as roads, pipelines and 3-D seismic surveys. Such expenditures
did not increase production from the Company's oil and gas properties. However,
the Company believes that with this infra-structure complete, the Company will
focus its capital expenditures on development of its oil and gas properties,
which the Company expects to continue the trend of increased revenues from the
year ended December 31, 1993 to December 31, 1994. As the Company's revenues
increase, the Company expects continued improvement to its profitability. The
Company's ability to maintain its financing arrangements, produce its oil and
gas reserves and service its debt obligations would be adversely affected by a
lack of profitability. Any improvement in profitability of the Company will be
dependent upon improvement in the development of reserves, revenues from the
sale of oil and gas reserves and oil and gas pricing, and there can be no
assurance that such improvement will occur.

FOREIGN OPERATIONS

For 1994, the Company derived approximately 76% of its consolidated oil and gas
revenues and approximately 96% of its Proved Reserves from its foreign
operations in Venezuela and Russia. The Company's Venezuelan and Russian
operations are subject to political, economic and other uncertainties inherent
in the development of foreign properties including, without limitation, risks
of war, revolution, expropriation, cancellation, renegotiation or modification
of existing contracts, export and transportation regulations and tariffs,
taxation and royalty policies, foreign exchange restrictions, adverse changes
in currency value, international monetary fluctuations, environmental controls
and other hazards arising out of foreign government sovereignty over certain
areas in which the Company plans to conduct operations.

The Company's operations have not been materially adversely affected to date by
political instability or the recent banking crisis in Venezuela. Similarly, to
date, the Company's operations have not been materially adversely affected by
the recent political or economic instability in Russia. However, there can be
no assurance that the Company's operations will not be materially adversely
affected by political or economic instability or burdensome taxation in the
future. The Company currently carries no insurance against political
instability. However, the Company has applied for insurance to cover the risk
of currency repatriation and inconvertibility, expropriation and interference
with operations for its Venezuelan operations with the Overseas Private
Investment Corporation ("OPIC"), an agency of the Untied States government.
There can be no assurance that the Company will be able to obtain this
insurance or that it can be obtained at a reasonable cost.

The Company has limited experience in conducting oil and gas operations in
Venezuela and Russia. The Company formed ventures with local partners in
Venezuela and Russia in an attempt to reduce some of the risks associated with
conducting operations in such countries and to facilitate local transactions.
The Company may encounter

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unforeseen difficulties in Venezuela and Russia, including problems related to
production and deliverability of oil and gas, and any such difficulties could
have a material adverse effect on the Company.

Furthermore, the timing and extent of the Company's development activities in
Venezuela are subject to the approval of Lagoven and the Ministry of Energy and
Mines. There can be no assurance that the development activities proposed by
Benton-Vinccler will receive the necessary approval. In addition, pursuant to
the Articles of Incorporation/By-Laws of Benton-Vinccler, the consent of both
the Company and Vinccler is a prerequisite to certain corporate transactions
and other matters relating to Benton-Vinccler, including, without limitation,
any sale of corporate assets, any assignment or sub-contracting of the
operating service agreement with Lagoven, any change in Benton-Vinccler's
corporate capital, duration or corporate purpose, any merger between
Benton-Vinccler and another company as well as certain amendments to Benton-
Vinccler's Articles of Incorporation/By-Laws. There can be no assurance that
the Company and Vinccler will agree upon any such proposed transactions or
matters.

In addition to the factors discussed above, Russia has established an export
tariff on all oil produced in and exported from Russia which, as imposed, has
the effect of reducing the potential profits to the Company and could render
its proved reserves attributable to Russia uneconomic. However, the Russian
Federation has issued or drafted various decrees and legislation under which
certain oil and gas joint ventures, including GEOILBENT, are eligible for
relief from such oil export tariff until such time as they have recovered
certain of their expenditures. GEOILBENT has received a waiver from the export
tariff for 1995, and expects to apply for renewal of such waiver for 1996 and
1997. However, there can be no assurance that any such renewals can be
obtained. Furthermore, after the waiver for 1995 was issued to GEOILBENT, a new
Russian law came into force which repeals all taxes and customs benefits
previously granted to participants in foreign economic activities, except for
those granted pursuant to certain federal laws, including the law "On Customs
Tariffs." While it is not clear whether the repeal applies to GEOILBENT's
waiver for 1995, GEOILBENT believes that its waiver should be regarded as
granted pursuant to the law "On Customs Tariffs." The legislative and
regulatory environment in Russia continues to be subject to frequent change and
uncertainty.

In addition, the license which grants GEOILBENT the right to develop the North
Gubkinskoye Field sets forth required levels of oil and gas production through
the year 2000 and requires GEOILBENT to make additional royalty payments in the
event that such production levels are not achieved during any three year
period. As a result of the recent volatility in net wellhead oil prices and
the export tariff, GEOILBENT's production for 1994 was significantly lower than
that required for 1994, and, if such adverse conditions were to continue,
GEOILBENT might produce significantly less oil and gas than required under the
license during the next few years, which could result in GEOILBENT paying
significantly higher royalties under the license.

The Company will not receive distributions from GEOILBENT until it has expended
its capital requirements under the terms of the joint venture agreement. As of
the date of this Prospectus, the Company has fulfilled the $25.8 million
capital requirement under the agreement. The Company believes that it will
not receive any significant distributions from GEOILBENT for several years
because substantially all of the money received by GEOILBENT from the North
Gubkinskoye Field will be reinvested to fund future development activities.

PROPERTIES UNDER DEVELOPMENT

As of December 31, 1994, approximately 79% of the Company's Proved Reserves
were undeveloped and required development activities consisting primarily of
recompletions, drilling of replacement wells and other development drilling. In
addition, approximately 3% of the Company's Proved Reserves were proved
developed behind-pipe or shut-in, requiring additional development work. As a
result, the Company will require substantial capital expenditures to develop
all of its proved reserves. At December 31, 1994, the anticipated Future
Development Costs for Proved Reserves in the United States, Venezuela and
Russia were $2.0 million, $79.5 million and $25.4 million, respectively. The
Company does not currently have the capital to develop all of these reserves,
and if such capital is not available, the Company will either enter into
joint ventures to develop the projects, which will result in the Company
retaining a smaller interest, or not develop the reserves. There can be no
certainty regarding the commercial feasibility of developing these reserves,
the availability of financing, or the timing or costs associated therewith. If
such capital is available, there can be no assurance that the Company will be
able to develop and

10
<PAGE> 11
produce sufficient reserves to recover the costs expended and operate the wells
profitably. In addition, the Company may not be able to control the development
activities in fields either operated by industry partners or in which
development activities are subject to approval by its partners. If the Company
and its industry partners are not able to meet the financial and development
obligations in these fields, the interests in the affected properties may be
sold, farmed out or forfeited.

ENGINEERS' ESTIMATES OF RESERVES AND FUTURE NET REVENUE

This Prospectus contains estimates of the Company's oil and gas reserves and
the future net revenues therefrom which have been prepared by the Company and
audited by Huddleston & Co., Inc., independent petroleum engineers. Estimates
of commercially recoverable oil and gas reserves and of the future net cash
flows derived therefrom are based upon a number of variable factors and
assumptions, such as historical production from the subject properties,
comparison with other producing properties, the assumed effects of regulation
by governmental agencies and assumptions concerning future operating costs,
severance and excise taxes, export tariffs, abandonment costs, development
costs and workover and remedial costs, all of which may vary considerably from
actual results. All such estimates are to some degree speculative, and various
classifications of reserves are only attempts to define the degree of
speculation involved. For these reasons, estimates of the commercially
recoverable reserves of oil and natural gas attributable to any particular
property or group of properties, the classification, cost and risk of
recovering such reserves and estimates of the future net cash flows expected
therefrom, prepared by different engineers or by the same engineers at
different times, may vary substantially. The difficulty of making precise
estimates is accentuated by the fact that 82% of the Company's total Proved
Reserves were non-producing as of December 31, 1994. Therefore, the Company's
actual production, revenues, severance and excise taxes, export tariffs,
development expenditures, workover and remedial expenditures, abandonment
expenditures and operating expenditures with respect to its reserves will
likely vary from estimates, and such variances may be material.

In addition, actual future net cash flows will be affected by factors such as
actual production, supply and demand for oil and natural gas, availability and
capacity of gas gathering systems and pipelines, curtailments in consumption by
natural gas purchasers, changes in governmental regulations or taxation and the
impact of inflation on costs. The timing of actual future net revenue from
Proved Reserves, and thus their actual present value, can be affected by the
timing of the incurrence of expenditures in connection with development of oil
and gas properties. The 10% discount factor, which is required by the
Commission to be used to calculate present value for reporting purposes, is not
necessarily the most appropriate discount factor based on interest rates in
effect from time to time and risks associated with the oil and gas industry.
Discounted present value, no matter what discount rate is used, is materially
affected by assumptions as to the amount and timing of future production, which
may and often do prove to be inaccurate.

DEVELOPMENT OF ADDITIONAL RESERVES

The Company's future success may also depend upon its ability to find or
acquire additional oil and gas reserves that are economically recoverable.
Except to the extent that the Company conducts successful exploration or
development activities or acquires properties containing Proved Reserves, the
Proved Reserves of the Company will generally decline as reserves are produced.
There can be no assurance that the Company will be able to discover additional
commercial quantities of oil and gas, or that the Company will be able to
continue to acquire interests in underdeveloped oil and gas fields and enhance
production and reserves by conducting workovers and recompletions, drilling
replacement wells and drilling development wells, or that the Company will have
continuing success drilling productive wells and acquiring underdeveloped
properties at low finding costs.

LITIGATION

On June 13, 1994, certain partners in oil and gas limited partnerships,
sponsored by the Company, filed suit against Benton in the Ventura Superior
Court. The allegations in the complaint related to the Company's operation of
the partnerships and original sale of the Partnership Units. In an effort to
resolve the concerns raised by these partners, the Company agreed to submit the
matter to arbitration, conditioned upon the execution of a mutually
satisfactory arbitration agreement. After discussions between the Company and
the agent for the partners failed to produce a satisfactory arbitration
agreement, the Company filed an answer to the complaint. The parties have now
voluntarily

11
<PAGE> 12
dismissed the action and submitted the issues and claims to arbitration. The
Company believes that the allegations made by the partners in the arbitration
are without merit and intends to vigorously defend this action.

In addition, investors in partnerships which were sponsored by a third party
have sued the Company on the theory that since it provided oil and gas drilling
prospects to those partnerships and operated substantially all of their
properties, it was responsible for alleged violations of securities laws in
connection with the offer and sale of interests, contractual breach of
fiduciary duty and fraud. The Company has entered into a settlement agreement
related to these claims, whereby the Company has placed $841,500 in an escrow
account for the benefit of the plaintiffs. The Company has agreed to pay an
additional $148,500 into the escrow account in full settlement of these claims,
expected to occur in the first quarter of 1996. All of the costs of the
settlement will be expensed in the fourth quarter of 1995.

RETENTION AND ATTRACTION OF KEY PERSONNEL

The Company depends to a large extent on the abilities and continued
participation of certain key employees, the loss of whose services could have a
material adverse effect on the Company's business. In an effort to minimize the
risk, the Company has entered into employment agreements with certain key
employees, and has purchased a $5.0 million key-man life insurance policy on
the life of A.E. Benton. There can be no assurance that the Company will be
able to attract and retain such personnel on acceptable terms and the failure
to do so could have a material adverse effect on the Company.

DIVIDEND POLICY

The Company does not currently pay cash dividends on its Common Stock and does
not anticipate paying such dividends at any time in the future.

ANTI-TAKEOVER PROVISIONS

The Delaware General Corporation Law contains certain provisions
which may delay or prevent an attempt by a third party to acquire control of
the Company. In addition, the severance provisions of employment agreements
with certain members of management could impede an attempted change of control
of the Company. In 1995, the Company adopted a Shareholder Rights Plan which
may delay or prevent an attempt by a third party to acquire control of the
Company.

ABILITY TO ISSUE PREFERRED STOCK

The Company may issue Preferred Stock in the future without stockholder
approval and upon such terms and conditions, and having such rights, privileges
and preferences, as the Board of Directors may determine. The rights of the
holders of Common Stock will be subject and subordinate to, and may be
adversely affected by, the rights of the holders of any Preferred Stock
that may be issued in the future. The issuance of Preferred Stock could have
the effect of making it more difficult for a third party to acquire, or
discouraging a third party from acquiring, a majority of the outstanding voting
stock of the Company. The Company has no outstanding Preferred Stock and no
present plans to issue any shares of Preferred Stock.

RISKS RELATED TO THE OIL AND GAS INDUSTRY

RISK OF OIL AND GAS OPERATIONS

The Company's operations are subject to all of the risks normally incident to
the operation and development of oil and gas properties and the drilling of oil
and gas wells, including encountering unexpected formations or pressures,
blowouts, cratering and fires, and, in horizontal wellbores, the increased risk
of mechanical failure and collapsed

12
<PAGE> 13
holes, the occurrence of any of which could result in personal injuries, loss
of life, environmental damage and other damage to the properties of the Company
or others. In addition, because the Company acquires interests in
underdeveloped oil and gas fields that have been operated by others for many
years, the Company may be liable for any damage or pollution caused by any
prior operations of such oil and gas fields. Moreover, offshore operations are
subject to a variety of operating risks peculiar to the marine environment --
such as hurricanes or other adverse weather conditions -- to more extensive
governmental regulation, including certain regulations that may, in certain
circumstances, impose absolute liability for environmental damage, and to
interruption or termination of business activities by government authorities
based upon environmental or other considerations. In accordance with customary
industry practice, the Company is not fully insured against these risks, nor
are all such risks insurable. Accordingly, there can be no assurance that such
insurance as the Company does maintain will be adequate to cover any
losses or exposure for liability.

CURRENT OIL AND GAS INDUSTRY CONDITIONS

Historically, the markets for oil and natural gas have been volatile
and are likely to continue to be volatile in the future. Prices for oil and
natural gas are subject to wide fluctuation in response to relatively minor
changes in supply of and demand for oil and natural gas, market uncertainty and
a variety of additional factors that are beyond the control of the Company.
These factors include political conditions in the Middle East, the foreign
supply of oil and natural gas, the price of foreign imports, the level of
consumer product demand, weather conditions, domestic and foreign government
regulations, the price and availability of alternative fuels and overall
economic conditions. Lower oil and natural gas prices also may reduce the
amount of the Company's oil and natural gas that is economic to produce. In
addition, the marketability of the Company's production depends upon the
availability and capacity of gas gathering systems and pipelines.

GOVERNMENT REGULATION; ENVIRONMENTAL RISKS

The Company's business is regulated by certain federal, state, local and
foreign laws and regulations relating to the development, production,
marketing and transmission of oil and gas, as well as environmental and safety
matters. There can be no assurance that laws and regulations enacted in the
future will not adversely affect the Company's exploration for, or the
production and marketing of, oil and gas.

Oil and gas operations are subject to extensive foreign, federal, state and
local laws regulating the discharge of materials into the environment or
otherwise relating to the protection of the environment. Numerous governmental
departments issue rules and regulations to implement and enforce such laws
which are often difficult and costly to comply with and which carry substantial
penalties for failure to comply. The regulatory burden on the oil and gas
industry increases its cost of doing business and consequently affects its
profitability. These laws, rules and regulations affect the operations of the
Company. Compliance with environmental requirements generally could have a
material adverse effect upon the capital expenditures, earnings or competitive
position of the Company.

COMPETITION

The oil and gas exploration and production business is highly competitive. A
large number of companies and individuals engage in the drilling for oil and
gas, and there is a high degree of competition for desirable oil and gas
properties suitable for drilling and for materials and third-party services
essential for their exploration and development. Many of the Company's
competitors have greater financial and other resources than does the Company.

13
<PAGE> 14
THE COMPANY

The Company is primarily engaged in the development and production of oil and
gas properties. The Company's operations are focused in the eastern region of
Venezuela, the Gulf Coast region of Louisiana and the West Siberia region of
Russia. At December 31, 1994, the Company's proved reserves of 81.2 MMBOE
consisted of 78.5 MMBbl of oil and 16.1 Bcf of natural gas. The Company's
proved reserves, net of production, have increased form 14.8 MMBOE at December
31, 1990 to 81.2 MMBOE through purchases of reserves-in-place, awards of
development contracts, discoveries of oil and natural gas reserves, extensions
of existing producing fields and revisions of previously estimated reserves.
The standardized measure of discounted future net cash flows, before provision
of income taxes, relating to the Company's proved reserves at December 31, 1994
was approximately $336.3 million.

The Company was incorporated in Delaware in September 1988 and operates
principally through its wholly-owned subsidiary Benton Oil and Gas Company of
Louisiana and its 80% owned subsidiary Benton-Vinccler in Venezuela. The
Company's Russian operations are conducted through GEOILBENT, which is only 34%
owned by the Company. The Company's principal executive offices are located at
1145 Eugenia Place, Suite 200, Carpinteria, California 93013, and its telephone
number is (805) 566-5600.

<TABLE>
<CAPTION>
- -------------------------------------------------------------
BENTON OIL
AND GAS COMPANY
- -------------------------------------------------------------
<S> <C> <C>
80% 100% 34%
Owned Subsidiary Owned Subsidiary Owned Joint Venture

- --------------------- ------------------------- --------------------------
Benton-Vinccler, C.A. Benton Oil and Gas GEOILBENT, Ltd.
Company of Louisiana Joint Venture
- --------------------- ------------------------- --------------------------
</TABLE>

USE OF PROCEEDS

Assuming all of the Warrants are exercised, the Company will receive a total of
$3,485,000, which it will use for working capital purposes. The Company will
receive no proceeds from the sale of Shares by the Selling Stockholders.

SELLING STOCKHOLDERS

The following table sets forth information as of December 21, 1995 with respect
to the beneficial ownership of Common Stock by the Selling Stockholders. None
of the Selling Stockholders has any position, office or other material
relationship with the Company or any of its affiliates, or has had such within
the last three years, or owns in excess of 1% of the outstanding Common Stock
of the Company except as set forth below.

14
<PAGE> 15
<TABLE>
<CAPTION>
NAME OF SELLING STOCKHOLDER | SHARES OF COMMON SHARES TO BE SOLD SHARES OF COMMON PERCENTAGE OF
| STOCK OWNED PRIOR PURSUANT HERETO STOCK TO BE OWNED SHARES TO BE
| TO OFFERING AFTER OFFERING OWNED AFTER
| OFFERING (1)
- ------------------------------|------------------------------------------------------------------------------
<S> | <C> <C> <C> <C>
Jeff and Deborah Aivazian | 4,083(2) 1,000 3,083 *
|
Sharon L Anderson | 1,000(2) 1,000 0 *
|
John R. And Patricia A. | 8,500(15) 8,500 0 *
Bancroft |
|
Scott L. Baranoff | 2,000(3) 2,000 0 *
|
Steve Benak, M.D. | 4,000(3) 4,000 0 *
|
Aileene D. Benner, Trustee | 1,000(2) 1,000 0 *
|
Bruno Biava | 14,000(10) 10,000 4,000 *
|
Stanley M. and Patricia A. | 3,000(2) 1,000 2,000 *
Bieza |
|
William D. Blake | 13,788(4) 3,000 10,788 *
|
Edgar L. and Lynn C. Blubaum | 2,000(3) 2,000 0 *
|
George M. and Norma G. | 700(5) 500 200 *
Boswell |
|
Dean Brady, Trustee | 500(5) 500 0 *
|
Robert M. Bragg, Trustee | 1,000(2) 1,000 0 *
|
Alfred W. Brandt, Trustee | 4,000(3) 2,000 2,000 *
|
Franklin J. Brenner | 8,488(3) 6,000 2,488 *
|
Hoby and Alexis Brenner | 4,869(2) 1,000 3,869 *
|
Jed Brickner | 1,000(2) 1,000 0 *
|
Philip W. Brickner | 1,000(2) 1,000 0 *
|
G. Lee and Janel M. | 3,566(3) 2,000 1,566 *
Brookshire |
|
Fred and Sue Carlisle | 1,000(2) 1,000 0 *
|
Jack and Leta A. Carlson | 2,000(3) 2,000 0 *
|
Gary L. And Patricia J. | 1,000(2) 1,000 0 *
Channer |
|
Mehran and Madeline | 5,333(2) 2,000 3,333 *
Chooljian |
|
Michael M.S. and Jeannine B. | 1,000(2) 1,000 0 *
Chun |

</TABLE>

15
<PAGE> 16
<TABLE>
<CAPTION>
NAME OF SELLING STOCKHOLDER | SHARES OF COMMON SHARES TO BE SOLD SHARES OF COMMON PERCENTAGE OF
| STOCK OWNED PRIOR PURSUANT HERETO STOCK TO BE OWNED SHARES TO BE
| TO OFFERING AFTER OFFERING OWNED AFTER
| OFFERING (1)
- -------------------------------|-----------------------------------------------------------------------------
<S> | <C> <C> <C> <C>
Philip J. Cicala | 2,000(3) 2,000 0 *
|
Gary D. and Bonnie Clemens, | 2,000(3) 2,000 0 *
Trustees |
|
Robert Cochran | 2,500(6) 2,500 0 *
|
Philip J. Cohen, TTEE | 1,000(2) 1,000 0 *
|
Thomas S. Comer | 2,000(3) 2,000 0 *
|
Joseph J. Connolly | 1,000(2) 1,000 0 *
|
John H. and Joan S. Coogan, | 5,222(11) 3,000 2,222 *
Trustees |
|
Nettie Craig | 2,000(3) 2,000 0 *
|
Charles E. and Charlene A. | 2,000(3) 2,000 0 *
Curtis, Trustees |
|
Douglas Davidian | 1,000(2) 1,000 0 *
|
Haig Davidian | 100,000(2) 1,000 99,000 *
|
Lyle E. and Mary Kirk Davis | 1,000(2) 1,000 0 *
|
Marshall Den Hartog | 1,000(2) 1,000 0 *
|
William A. and Catherine M. | 2,500(6) 2,500 0 *
Devine |
|
Milton I. Drucker | 5,000(2) 1,000 4,000 *
|
Gary J. Dubler | 2,500(5) 500 2,000 *
|
Gerard M. DuCorday | 2,000(3) 2,000 0 *
|
Robert E. Duncan | 6,166(3) 2,000 4,166 *
|
William L. And Virginia S. | 6,000(14) 6,000 0 *
Eaton, TTEE |
|
Robert G. and Eleanor | 4,000(13) 4,000 0 *
Durling, Trustees |
|
Warren L. and Darleen L. | 4,500(7) 4,500 0 *
Ellison |
|
Jack C. Emerian | 18,400(3) 2,000 16,400 *
|
Martin A. Evans, Trustee | 10,133(5) 1,000 9,133 *
|
Edmund M. and Kim L. Fansler | 2,000(3) 2,000 0 *

</TABLE>

16
<PAGE> 17
<TABLE>
<CAPTION>
NAME OF SELLING STOCKHOLDER | SHARES OF COMMON SHARES TO BE SOLD SHARES OF COMMON PERCENTAGE OF
| STOCK OWNED PRIOR PURSUANT HERETO STOCK TO BE OWNED SHARES TO BE
| TO OFFERING AFTER OFFERING OWNED AFTER
| OFFERING (1)
- -------------------------------|-----------------------------------------------------------------------------
<S> | <C> <C> <C> <C>
Joe B. Fields, Trustee | 5,500(16) 5,500 0 *
|
Patrick M. Flanagan, Trustee | 18,000(3) 2,000 16,000 *
|
Greg Foley | 2,500(6) 2,500 0 *
|
Arthur and Leona Franz | 500(5) 500 0 *
|
Walter C. Frick, Trustee | 10,333(2) 1,000 9,333 *
|
Arnhold H. and Diane B. | 20,000(5) 500 19,500 *
Gazarian, Trustees |
|
Charles Gessert, M.D. | 28,000(2) 1,000 27,000 *
|
Kenneth Glick | 28,000(3) 2,000 26,000 *
|
Robert Gomes | 2,000(3) 2,000 0 *
|
Robert E. Grider | 2,000(3) 2,000 0 *
|
Barry Jon and Janice Grumman | 1,000(2) 1,000 0 *
|
William K. and Gladys W. | 25,000 3,500 21,500 *
Hagerty |
|
John Hartman | 1,000(2) 1,000 0 *
|
Edward S. Hewitt | 5,000(8) 5,000 0 *
|
Dwight and Judy Hiscox | 2,000(3) 2,000 0 *
|
Peter and Carolyn Hobbs | 1,000(2) 1,000 0 *
|
Darol Hoffman | 2,000(3) 2,000 0 *
|
Ronald J. and Marguerite | 1,000(2) 1,000 0 *
Holecek |
|
Edward L. Hombordy | 1,000(2) 1,000 0 *
|
William O. and Nancy H. | 7,200(3) 2,000 5,200 *
Hoverman |
|
Roderick R. Hubbard | 2,000(3) 2,000 0 *
|
Betty R. and Reuben P. | 20,000(12) 20,000 0 *
Hughes, Trustee |
|
Eric and Candice Jahnke | 1,000(2) 1,000 0 *
|
Carl C. Jensen | 2,000(3) 2,000 0 *
|
Bobby Mason Johnson | 5,622 1,000 4,622 *
</TABLE>

</TABLE>

</TABLE>

</TABLE>

21
<PAGE> 22
* Less than 1%

(1) Based upon 25,393,067 shares of Common Stock outstanding on December 21,
1995.

(2) Includes 1,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(3) Includes 2,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(4) Includes 1,500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(5) Includes 500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(6) Includes 2,500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(7) Includes 4,500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(8) Includes 5,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(9) Includes 7,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(10) Includes 10,000 shares subject to warrants which are currently
exercisable or exercisable within 60 days of the date hereof.

(11) Includes 3,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(12) Includes 20,000 shares subject to warrants which are currently
exercisable or exercisable within 6 days of the date hereof.

(13) Includes 4,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(14) Includes 6,000 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(15) Includes 8,500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(16) Includes 5,500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.

(17) Includes 4,500 shares subject to warrants which are currently exercisable
or exercisable within 60 days of the date hereof.
<PAGE> 23
Of the Shares offered hereby, an aggregate of 139,000 shares were issued to
partners of the Benton Oil & Gas Private Drilling Partnership 1989-3, L.P.
(the "1989-3 Partnership") upon dissolution of the 1989-3 Partnership in
October 1992. In connection with such dissolution, the Company issued certain
of the Warrants pursuant to a Warrant Agreement dated October 30, 1992 (the
"Warrant Agreement"). The Warrant Agreement provides the partners with the
right to demand registration of the resale of the Shares. The Warrants were
not exercisable until one year following the date of issuance. The Company
cannot determine the timing of the sale of the Shares.

Of the Shares offered hereby, an aggregate of 209,500 shares were issued to
partners of the Benton Oil & Gas Private Drilling Partnership 1990-1, L.P.
(the "1990-1 Partnership") upon dissolution of the 1990-1 Partnership in
October 1992. In connection with such dissolution, the Company issued certain
of the Warrants pursuant to the Warrant Agreement. The Warrant Agreement
provides the partners with the right to demand registration of the resale of
the Shares. The Warrants were not exercisable until one year following the date
of issuance. The Company cannot determine the timing of the sale of the Shares.

DESCRIPTION OF WARRANTS

The Warrants were issued pursuant to a Warrant Agreement dated October 30,
1992. The Warrants provide the holders thereof with the right to purchase
shares of Common Stock at an exercise price of $10.00 per share. The Warrants
were not exerciseable until one year following the date of issuance, and the
Warrants expire, if not earlier exercised, on October 30, 1997. Pursuant to
the Warrant Agreement, an aggregate of 530,258 shares of Common Stock may be
issued by the Company, assuming the exercise of all Warrants by the holders
thereof.

PLAN OF DISTRIBUTION

The Shares may be sold from time to time by the Selling Stockholders, or by
pledgees, transferees, or other successors in interest. Such sales may be made
on the NASDAQ National Market, or otherwise at prices and at terms then
prevailing or at prices related to the then current market price, or in
negotiated transactions. The Shares may be sold by one or more of the
following: (a) a block trade in which the broker or dealer so engaged will
attempt to sell the Shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction; (b) purchases by a broker
or dealer as principal and resale by such broker or dealer for its account
pursuant to this Prospectus; (c) an exchange transaction in accordance with the
rules of such exchange; (d) ordinary brokerage transactions and transactions in
which the broker solicits purchasers; and (e) secondary distributions. In
effecting sales, brokers or dealers engaged by the Selling Stockholders may
arrange for other brokers or dealers to participate. Brokers or dealers will
receive commissions or discounts from the Selling Stockholders in amounts to be
negotiated immediately prior to the sale and which are not expected to exceed
those customary in the type of transactions involved. Such brokers or dealers
and any other participating brokers or dealers acting for the Selling
Stockholders may be deemed to be "underwriters" within the meaning of the Act
in connection with such sales, and any commissions, discounts, concessions or
profits received by them may be deemed to be underwriting compensation under
the Act.

The Company has agreed to maintain the effectiveness of the Registration
Statement of which this Prospectus is a part until the Shares registered have
been sold , or for a period of three years from the date of this Prospectus,
whichever occurs first.

23
<PAGE> 24
LEGAL MATTERS

The legality of the securities offered hereby is being passed upon by Emens,
Kegler, Brown, Hill & Ritter Co., L.P.A., Columbus, Ohio.

EXPERTS

The financial statements of the Company as of December 31, 1993 and 1994 and
for each of the three years in the period ended December 31, 1994 incorporated
into this Prospectus by reference to the Company's Annual Report on Form 10-K
for the year ended December 31, 1994 have been audited by Deloitte & Touche
LLP, independent auditors, as stated in their report, which is incorporated
herein by reference, and have been so incorporated by reference in reliance
upon the report of such firm given upon their authority as experts in
accounting and auditing.

The information appearing herein or incorporated herein by reference with
respect to proved oil and gas reserves of the Company at December 31, 1993 and
1994, to the extent stated herein or incorporated herein by reference, was
estimated by the Company and audited by Huddleston & Co., Inc., independent
engineers, and is included herein or incorporated herein by reference on the
authority of such firm as experts in petroleum engineering.

24
<PAGE> 25
GLOSSARY

When the following terms are used in the text they have the meanings indicated.

MCF. "Mcf" means thousand cubic feet. "MMcf" means million cubic feet. "Bcf"
means billion cubic feet. "Tcf" means trillion cubic feet.

BBL. "Bbl" means barrel. "MBbl" means thousand barrels. "MMBbl" means million
barrels. "BBbl" means billion barrels.

BOE. "BOE" means barrels of oil equivalent, which are determined using the
ratio of one barrel of crude oil, condensate or natural gas liquids to six Mcf
of natural gas so that six Mcf of natural gas is referred to as one barrel of
oil equivalent or "BOE." "MBOE" means thousands of barrels of oil equivalent.
"MMBOE" means millions of barrels of oil equivalent.

CAPITAL EXPENDITURES. "Capital Expenditures" means costs associated with
exploratory and development drilling (including exploratory dry holes);
leasehold acquisitions; seismic data acquisitions; geological, geophysical and
land-related overhead expenditures; delay rentals; producing property
acquisitions; and other miscellaneous capital expenditures.

COMPLETION COSTS. "Completion Costs" means, as to any well, all those costs
incurred after the decision to complete the well as a producing well.
Generally, these costs include all costs, liabilities and expenses, whether
tangible or intangible, necessary to complete a well and bring it into
production, including installation of service equipment, tanks, and other
materials necessary to enable the well to deliver production.

DEVELOPMENT WELL. A "Development Well" is a well drilled as an additional well
to the same reservoir as other producing wells on a lease, or drilled on an
offset lease not more than one location away from a well producing from the
same reservoir.

EXPLORATORY WELL. An "Exploratory Well" is a well drilled in search of a new
and as yet undiscovered pool of oil or gas, or to extend the limits of a field
under development.

FINDING COST. "Finding Cost," expressed in dollars per BOE, is calculated by
dividing the amount of total capital expenditures incurred related to
acquisitions, exploration and development costs (reduced by proceeds from any
sale of oil and gas properties) by the amount of total net reserves added or
reduced as a result of property acquisitions and sales, drilling activities and
reserve revisions during the same period.

FUTURE DEVELOPMENT COST. "Future Development Cost" of proved non-producing
reserves, expressed in dollars per BOE, is calculated by dividing the amount of
future capital expenditures related to development properties by the amount of
total proved non-producing reserves associated with such activities.

GROSS ACRES OR WELLS "Gross Acres or Wells" are the total acres or wells, as
the case may be, in which an entity has an interest, either directly or through
an affiliate.

LIFTING COSTS. "Lifting Costs" are the expenses of lifting oil from a producing
formation to the surface, consisting of the costs incurred to operate and
maintain wells and related equipment and facilities, including labor cots,
repair and maintenance, supplies, insurance, production, severance and windfall
profit taxes.

MMBTU. "MMBtu" means one million British thermal units. A British thermal unit
is the amount of heat needed to raise the temperature of one pound of water one
degree Fahrenheit.

25
<PAGE> 26
NET ACRES OR WELLS. A party's "Net Acres" or "Net Wells" are calculated by
multiplying the number of gross acres or gross wells in which that party has an
interest by the fractional interest of the party in each such acre or well.

OIL AND GAS LEASE. An "Oil and Gas Lease" is an agreement whereby the grantee
receives for a period of time the full or partial interest in oil and gas
properties, oil and gas mineral rights, fee rights, or other rights of the
grantor granting the grantee the right to drill for, produce and sell oil and
gas upon payment of rentals, bonuses and/or royalties. Oil and Gas Leases are
generally acquired from private landowners and federal and state governments.

PRODUCING PROPERTIES OR RESERVES. "Producing Reserves" are Proved Developed
Reserves expected to be produced from existing completion intervals now open
for production in existing wells. "Producing Properties" are properties to
which Producing Reserves have been assigned by an independent petroleum
engineer.

PROVED DEVELOPED BEHIND-PIPE RESERVES. "Proved Developed Behind-Pipe Reserves"
are reserves contained in geological formations through which an existing well
has been drilled but from which the well has not yet produced. The reserves are
said to be "behind pipe" because the oil and gas are sealed out of the well
bore by the casing leading to the existing completion interval. Behind-Pipe
Reserves are classified as Proved Developed only if the cost of completing the
well for production of such reserves is relatively small compared to the cost
of a new well.

PROVED DEVELOPED RESERVES. "Proved Developed Reserves" are Proved Reserves
which can be expected to be recovered through existing wells with existing
equipment and operating methods.

PROVED RESERVES. "Proved Reserves" are the estimated quantities of crude oil,
natural gas and natural gas liquids which geological and engineering data
demonstrate with reasonable certainty to be recoverable in future years known
oil and gas reservoirs under existing economic and operating conditions, that
is, on the basis of prices and costs as of the date the estimate is made and
any price changes provided for by existing conditions.

PROVED UNDEVELOPED RESERVES. "Proved Undeveloped Reserves" are Proved Reserves
which can be expected to be recovered from new wells on undrilled acreage, or
from existing wells where a relatively major expenditure is required for
recompletion.

RESERVES. "Reserves" means crude oil and natural gas, condensate and natural
gas liquids, which are net of leasehold burdens, are stated on a net revenue
interest basis, and are found to be commercially recoverable.

ROYALTY INTEREST. A "Royalty Interest" is an interest in oil and gas property
entitling the owner to a share of oil and gas production (or the proceeds of
the sale thereof) free of the costs of production.

STANDARDIZED MEASURE OF DISCOUNTED FUTURE NET CASH FLOWS, BEFORE PROVISION FOR
INCOME TAXES. The "Standardized Measure of Discounted Future Net Cash Flows,
Before Provision for Income Taxes" is a method of determining the present value
of Proved Reserves. Future net revenues from Proved Reserves are estimated
assuming that oil and gas prices and production and development costs remain
constant. The resulting stream of revenues, before provision for income taxes,
is then discounted at the rate of 10% per year to obtain a present value.

3-D SEISMIC. "3-D Seismic" is the method by which a three dimensional image of
the earth's subsurface is created through the interpretation of aerially
collected seismic data. 3-D surveys allow for a more detailed understanding of
the subsurface than do conventional surveys and contribute significantly to
field appraisal, development and production.

UNDEVELOPED ACREAGE. "Undeveloped Acreage" is oil and gas acreage (including,
in applicable instances, rights in one or more horizons which may be penetrated
by existing wellbores, but which have not been tested) to which Proved Reserves
have not been assigned by independent petroleum engineers.

WORKING INTEREST. A "Working Interest" is the operating interest under an Oil
and Gas Lease which gives the owner the right to drill, produce and conduct
operating activities on the property and a share of production, subject

<PAGE> 27
to all royalties, overriding royalties and other burdens and to all
costs of exploration, development and operations and all risks in connection
therewith.

In this Prospectus, natural gas volumes are stated at the legal pressure base
of the state or area in which the reserves are located at 60 degrees
Fahrenheit.

27
<PAGE> 28
PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The expenses payable by the Registrant in connection with the issuance and
distribution of the securities being registered (other than underwriting
discounts) are estimated to be as follows:
<TABLE>
<S> <C> <C>
SEC filing fee $1,743
Printing and engraving 750
Accounting fees and expenses 2,000
Legal fees and expenses 7,000
Miscellaneous 2,507
-------
Total $14,000
=======
</TABLE>

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Under provisions of the Certificate of Incorporation and Bylaws of the Company,
each person who is or was a director or officer of the Company shall be
indemnified by the Company as a matter of right to the full extent permitted or
authorized by law. The effects of the Certificate of Incorporation, Bylaws and
General Corporation Law of Delaware may be summarized as follows:

(a) Under Delaware law, to the extent that such a person is
successful on the merits in defense of a suit or proceeding brought against him
by reason of the fact that he is a director or officer of the Company, he shall
be indemnified against expenses (including attorneys' fees) reasonably incurred
in connection with such action.

(b) If unsuccessful in defense of a third-party civil suit or
criminal suit, or if such a suit is settled, such a person shall be indemnified
under such law against both (1) expenses (including attorneys' fees) and (2)
judgments, fines and amounts paid in settlement if he acted in good faith and
in a manner he reasonably believed to be in, or not opposed to, the best
interests of the Company, and with respect to any criminal action, had no
reasonable cause to believe his conduct was unlawful.

(c) If unsuccessful in defense of a suit brought by or in the
right of the Company, or if such suit is settled, such a person shall be
indemnified under such law only against expenses (including attorneys' fees)
incurred in the defense or settlement of such suit if he acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the best
interests of the Company except that if such person is adjudged to be liable in
a suit in the performance of his duty to the Company, he cannot be made whole
even for expenses unless the court determines that he is fairly and reasonably
entitled to indemnity for such expenses.

(d) The Company may not indemnify a person in respect of a
proceeding described in (b) or (c) above unless it is determined that
indemnification is permissible because the person has met the prescribed
standard of conduct by any one of the following: (i) the Board of Directors, by
a majority vote of a quorum consisting of directors not at the time parties to
the proceeding, (ii) if quorum of directors not parties to the proceeding
cannot be obtained, or, if obtainable but the quorum so directs, by independent
legal counsel selected by the Board of Directors or the committee thereof; or
(iii) by the stockholders.

II-1
<PAGE> 29
ITEM 16. EXHIBITS

(a) Exhibits

4.1 Form of Warrant Agreement.

5.1 Form of Opinion of Emens, Kegler, Brown, Hill &
Ritter Co., L.P.A. regarding validity of the
Securities.

23.1 Consent of Deloitte & Touche LLP (included on page
II-5).

23.2 Consent of Emens, Kegler, Brown, Hill & Ritter Co.,
L.P.A.

23.4 Consent of Huddleston & Co., Inc.

24.1 Power of Attorney (included on Signature Page).

(b) Financial Statements Schedules.

All schedules have been omitted because the required information is
not significant, or is included in the financial statements or the notes
thereto or is not applicable.

ITEM 17. UNDERTAKINGS

(a) The undersigned Registrant hereby undertakes:

(1) to file, during any period in which offers or sales
are being made, a post-effective amendment to this registration
statement:

(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or
events arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of the securities offered would not exceed
that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of Prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration
statement;

(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such
information in the registration statement;

provided, however, that paragraphs (a) (1) (i) and (a) (1) (ii) do not apply if
the information to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission

II-2
<PAGE> 30
by the Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), that are incorporated by
reference in the registration statement.

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

(3) To remove from registration by means of
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.

(b) 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 provisions described under Item 15,
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 the 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.

(c) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to section 15(d) of
the Securities Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

II-3
<PAGE> 31
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and had duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Carpinteria, State of California, on the 29th
day of December 1995.

BENTON OIL AND GAS COMPANY

By: /s/ A.E. Benton
--------------------------------------
A.E. Benton, President

Each person whose signature appears below appoints A.E. Benton, David H. Pratt,
Jack A. Bjerke and Amy M. Shepherd and all four of them, any of whom may act
without the joinder of the others as his true and lawful attorney-in-fact and
agent, will full power of substitution and resubstitution, for him, and in his
stead, in all capacities to sign any and all amendments, including
post-effective amendments to this Registration Statement, and to file the same,
with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and confirming
all that said attorney-in-fact and agent or their substitute or substitutes may
lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed on December 29, 1995 by the following
persons in the capacities indicated:

<TABLE>
<S> <C>
/s/ A.E. BENTON President, Chief Executive Officer and Director
- ------------------------
A.E. Benton

/s/ DAVID H. PRATT Vice President -- Finance, Principal Financial Officer
- ------------------------
David H. Pratt

/s/ CHRIS C. HICKOK Vice President -- Principal Accounting Officer
- ------------------------
Chris C. Hickok

/s/ BRUCE M. MCINTYRE Director
- ------------------------
Bruce M. McIntyre

/s/ MICHAEL B. WRAY Director
- ------------------------
Michael B. Wray

/s/ WILLIAM H. GUMMA Director
- ------------------------
William H. Gumma

/s/ RICHARD W. FETZNER Director
- ------------------------
Richard W. Fetzner

</TABLE>

II-4
<PAGE> 32
INDEPENDENT AUDITORS' CONSENT

We consent to the incorporation by reference into this Registration Statement
of Benton Oil and Gas Company on Form S-3 of our report dated March 31, 1995
appearing in the annual report on Form 10-K of Benton Oil and Gas Company for
the year ended December 31, 1994, and to the reference to our firm under the
caption "Experts" in the Prospectus, which forms a part of this Registration
Statement.

DELOITTE & TOUCHE LLP

Los Angeles, California

January 10, 1996

II-5

<PAGE> 1
WARRANT AGREEMENT

BETWEEN

BENTON OIL AND GAS COMPANY

AND

DATED AS OF OCTOBER 30, 1992

<PAGE> 2

WARRANT AGREEMENT dated as of October 30, 1992, between Benton Oil and
Gas Company, a Delaware corporation (the "Company") and ____________ ("Holder").

WHEREAS, the Company proposes to issue to the Holder as partial
compensation for its agreement to sell the partnership assets of the Benton Oil
& Gas Drilling Partnership 1989-3 L.P. (the "Partnership") and another for
Benton Oil & Gas Drilling Program 1990-1 L.P. (the "Partnership") common stock
purchase warrants (the "Warrants") to purchase up to ____________ shares (the
"Warrant Shares") of the Company's Common Stock, par value $.01 per share (the
"Common Stock"), each Warrant entitling the holder thereof to purchase one share
of Common Stock.

NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein and in the Agreement set forth and for other good and valuable
consideration, the parties hereto agree as follows:

1. Issuance of Warrants; Form of Warrant. The Company will issue and
deliver the Warrants to Holder, in consideration for, and as part of the
compensation to Holder in connection with the sale of the assets of the
Partnership. The number of Warrants to be issued and delivered shall be
________________. No cash consideration will be paid by Holder for the Warrants.
The text of each Warrant, of the purchase form and of each assignment form to be
printed on the reverse thereof shall be substantially as set forth in Exhibit A
attached hereto. The Warrants shall be executed on behalf of the Company by the
manual or facsimile signature of the present or any future Chairman of the
Board, President, Treasurer or Vice President of the Company, under its
corporate seal, affixed or in facsimile, attested by the manual or facsimile
signature of the present or future Secretary or an Assistant Secretary of the
Company. A Warrant bearing the manual or facsimile signature of individuals who
were at any time the proper officers of the Company shall bind the Company
notwithstanding that such individuals or any of them shall have ceased to hold
such offices prior to the delivery of such Warrant or did not hold such offices
on the date of this Agreement.

Warrants shall be dated as of the date of execution thereof by the
Company either upon initial issuance or upon division, exchange, substitution or
transfer.

2. Registration. The Warrants shall be numbered and shall be registered
on the books of the Company (the "Warrant Register") as they are issued. The
Company shall be entitled to treat the registered holder of any Warrant on the
Warrant Register (the "Holder") as the owner in fact thereof for all purposes
and shall not be bound to recognize any equitable or other claim to or interest
in such Warrant on the part of any other person, and shall

1
<PAGE> 3

not be liable for any registration or transfer of Warrants which are registered
or to be registered in the name of a fiduciary or the nominee of a fiduciary
unless made with the actual knowledge that a fiduciary or nominee is committing
a breach of trust in requesting such registration or transfer, or with knowledge
of such facts that its participation therein amounts to bad faith. The Warrants
shall be registered initially in the name of Holder in such denominations as
Holder may request in writing to the Company.

3. Exchange of Warrant Certificates. Subject to any restriction upon
transfer set forth in this Agreement, each Warrant certificate may be exchanged
at the option of the Holder thereof for another certificate or certificates of
different denominations entitling the Holder thereof to purchase upon surrender
to the Company or its duly authorized agent a like aggregate number of Warrant
Shares as the certificate or certificates surrendered then entitle such Holder
to purchase. Any Holder desiring to exchange a Warrant certificate or
certificates shall make such request in writing delivered to the Company, and
shall surrender, properly endorsed, the certificate or certificates to be so
exchanged. Thereupon, the Company shall execute and deliver to the person
entitled thereto a new Warrant certificate or certificates, as the case may be,
as so requested. Any Warrant issued upon exchange, transfer or partial exercise
of the Warrants shall be the valid obligation of the Company, evidencing the
same generic rights and entitled to the same generic benefits under this
Agreement as the Warrants surrendered for such exchange, transfer or exercise.

4. Restrictions on Transfer. From the date hereof until October 30,
1994 (the "Restricted Period"), the Warrants and the Warrant Shares may not be
sold, transferred, assigned or hypothecated except by operation of law. The
Warrants shall be transferable only on the Warrant Register upon delivery to the
Company of the Warrant certificate or certificates duly endorsed by the Holder
or by his duly authorized attorney or representative, or accompanied by proper
evidence of succession, assignment or authority to transfer. In all cases of
transfer by an attorney, the original power of attorney, duly approved, or an
official copy thereof, duly certified, shall be deposited with the Company. In
case of transfer by executors, administrators, guardians or other legal
representatives, duly authenticated evidence of their authority shall be
produced, and may be required to be deposited with the Company in its
discretion. Upon any registration of transfer, the Company shall deliver a new
Warrant or Warrants to the person entitled thereto. Notwithstanding the
foregoing and whether or not during the Restricted Period, the Company shall
have no obligation to cause Warrants to be transferred on its books to any
person, unless the Holder of such Warrants shall furnish to the Company evidence
of compliance with the Securities Act of 1933, as

2
<PAGE> 4

amended (the "Act"), in accordance with the provisions of Section 11 of this
Agreement.

5. Term of Warrants; Exercise of Warrants.

(a) Each Warrant entitles the Holder thereof to purchase one
share of Common Stock subject to adjustment in accordance with Section
9 hereof at any time from 9:00 A.M., Los Angeles time, on October 1,
1993 until 5:00 P.M., Los Angeles time, on October 30, 1997 (the
"Expiration Date") at a purchase price of $10.00 per share.

(b) The Warrant Price and the number of shares issuable upon
exercise of Warrants are subject to adjustment upon the occurrence of
certain events, pursuant to the provisions of Section 9 of this
Agreement. Subject to the provisions of this Agreement, each Holder
shall have the right, which may be exercised as expressed in such
Warrants, to purchase from the Company (and the Company shall issue and
sell to such Holder) the number of fully paid and nonassessable shares
of Common Stock specified in such Warrants, upon surrender to the
Company, or its duly authorized agent, of such Warrants, with the
purchase form on the reverse thereof duly filled in and signed, and
upon payment to the Company of the Warrant Price, as adjusted in
accordance with the provisions of Section 9 of this Agreement, for the
number of shares in respect of which such Warrants are then exercised.
Payment of such Warrant Price may be made only in cash, or by certified
or official bank check.

Upon such surrender of Warrants, and payment of the Warrant Price as
aforesaid, the Company shall issue and cause to be delivered with all reasonable
dispatch to or upon the written order of the Holder and (subject to receipt of
evidence of compliance with the Act in accordance with the provisions of Section
11 of this Agreement) in such name or names as the Holder may designate, a
certificate or certificates for the number of full shares of Common Stock so
purchased upon the exercise of such Warrants, together with cash, as provided in
Section 10 of this Agreement, in respect of any fraction of a share of such
stock otherwise issuable upon such surrender. Such certificate or certificates
shall be deemed to have been issued and any person so designated to be named
therein shall be deemed to have become a holder of record of such shares as of
the date of the surrender of such Warrants and payment of the Warrant Price as
aforesaid; provided, however, that if, at the time of surrender of the Warrant
and payment of such Warrant Price, the transfer books for the Common Stock or
other class of stock purchasable upon the exercise of the Warrants shall be
closed, the certificates for the shares in respect of which the Warrants are
then exercised shall be issuable as of the date on which such books shall next
be opened whether before, on or after

3
<PAGE> 5

the Expiration Date and until such date the Company shall be under no duty to
deliver any certificate for such shares; provided, further, however, that the
transfer books shall not be closed at any one time for a period longer than five
days unless otherwise required by law. The rights of purchase represented by the
Warrants shall be exercisable, at the election of the Holders thereof, either in
full or from time to time in part and, in the event that any Warrant is
exercised in respect of less than all of the shares purchasable on such exercise
at any time prior to the Expiration Date, a new certificate evidencing the
remaining Warrant or Warrants will be issued.

5.1. Compliance with Government Regulations. The Company covenants that
if any shares of Common Stock required to be reserved for purposes of exercise
or conversion of Warrants require, under any Federal or state law or applicable
governing rule or regulation of any national securities exchange, registration
with or approval of any governmental authority, or listing on any such national
securities exchange, before such shares may be issued upon exercise, the Company
will in good faith and as expeditiously as possible endeavor to cause such
shares to be duly registered, approved or listed on the relevant national
securities exchange, as the case may be, provided, however, that in no event
shall such shares of Common Stock be issued, and the Company is hereby
authorized to suspend the exercise of all Warrants, for the period during which
such registration, approval or listing is required but not in effect.

6. Payment of Taxes. The Company will pay all documentary stamp taxes,
if any, attributable to the initial issuance of Warrant Shares upon the exercise
of Warrants and any securities issued pursuant to Section 9 hereof; provided,
however, that the Company shall not be required to pay any tax or taxes which
may be payable in respect of any transfer involved in the issue or delivery of
any Warrants or certificates for Warrant Shares and any securities issued
pursuant to Section 9 hereof in a name other than that of the Holder of such
Warrants.

7. Mutilated or Missing Warrants. In case any of the Warrants shall be
mutilated, lost, stolen or destroyed, the Company may in its discretion issue
and deliver in exchange and substitution for and upon cancellation of the
mutilated Warrant, or in lieu of and in substitution for the Warrant lost,
stolen or destroyed, a new Warrant of like tenor and representing an equivalent
right or interest; but only upon receipt of evidence reasonably satisfactory to
the Company of such loss, theft or destruction of such Warrant and indemnity or
bond, if requested, also reasonably satisfactory to the Company. An applicant
for such substitute Warrants shall also comply with such other reasonable

4
<PAGE> 6

regulations and pay such other reasonable charges as the Company
may prescribe.

8. Reservation of Warrant Shares; Purchase and Cancellation of
Warrants. There have been reserved out of the authorized and unissued shares of
Common Stock, a number of shares sufficient to provide for the exercise of the
rights of purchase represented by the Warrants, and the transfer agent for the
Common Stock ("Transfer Agent") and every subsequent transfer agent for any
shares of the Company's capital stock issuable upon the exercise of any of the
rights of purchase aforesaid are hereby irrevocably authorized and directed at
all times until the Expiration Date to reserve such number of authorized and
unissued shares as shall be requisite for such purpose. The Company will keep a
copy of this Agreement on file with the Transfer Agent and with every subsequent
transfer agent for any shares of the Company's capital stock issuable upon the
exercise of the rights of purchase represented by the Warrants. The Company will
supply the Transfer Agent and any such subsequent transfer agent with duly
executed stock certificates for such purpose and will itself provide or
otherwise make available any cash which may be issuable as provided in Section
10 of this Agreement. The Company will furnish to the Transfer Agent and any
such subsequent transfer agent a copy of all notices of adjustments, and
certificates related thereto, transmitted to each Holder pursuant to Section 9.3
hereof. All Warrants surrendered in the exercise of the rights thereby evidenced
shall be cancelled, and such cancelled Warrants shall constitute sufficient
evidence of the number of shares of stock which have been issued upon the
exercise of such Warrants (subject to adjustment as herein provided). No shares
of stock shall be subject to reservation in respect of the Warrants subsequent
to the Expiration Date except to the extent necessary to comply with the terms
of this Agreement.

9. Adjustment of Warrant Price and Number of Warrant Shares. The number
and kind of securities purchasable upon the exercise of each Warrant and the
Warrant Price shall be subject to adjustment from time to time upon the
occurrence of certain events, as hereafter defined.

9.1. Mechanical Adjustments. The number of Warrant Shares purchasable
upon the exercise of each Warrant and the Warrant Price shall be subject to
adjustment as follows:

(a) In case the Company shall (i) pay a dividend in shares of
Common Stock or make a distribution in shares of Common Stock, (ii)
subdivide its outstanding shares of Common Stock, (iii) combine its
outstanding shares of Common Stock into a smaller number of shares of
Common Stock or (iv) issue

5
<PAGE> 7

by reclassification of its shares of Common Stock other securities of
the Company (including any such reclassification in connection with a
consolidation or merger in which the Company is the surviving
corporation), the number of Warrant Shares purchasable upon exercise of
each Warrant immediately prior thereto shall be adjusted so that the
Holder of each Warrant shall be entitled to receive the kind and number
of Warrant Shares or other securities of the Company which he would
have owned or have been entitled to receive after the happening of any
of the events described above, had such Warrant been exercised
immediately prior to the happening of such event or any record date
with respect thereto regardless of whether the Warrants are exercisable
at the time of the happening of such event or at the time of any record
date with respect thereto. An adjustment made pursuant to this
paragraph (a) shall become effective immediately after the effective
date of such event retroactive to the record date, if any, for such
event.

(b) In case the Company shall issue rights, options or
warrants to all holders of its outstanding Common Stock, without any
charge to such holders, entitling them (for a period expiring within 60
days after the record date mentioned below) to subscribe for or
purchase shares of Common Stock at a price per share which is lower at
the record date mentioned below than the then current market price per
share of Common Stock (as determined in accordance with paragraph (e)
below), the number of Warrant Shares thereafter purchasable upon the
exercise of each Warrant shall be determined by multiplying the number
of Warrant Shares theretofore purchasable upon exercise of each Warrant
by a fraction, of which the numerator shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights,
options or warrants plus the number of additional shares of Common
Stock offered for subscription or purchase, and of which the
denominator shall be the number of shares of Common Stock outstanding
on the date of issuance of such rights, options or warrants plus the
number of shares which the aggregate offering price of the total number
of shares of common stock so offered would purchase at the current
market price per share of Common Stock at such record date. Such
adjustment shall be made whenever such rights, options or warrants are
issued, and shall become effective immediately after the record date
for the determination of stockholders entitled to receive such rights,
options or warrants.

(c) In case the Company shall distribute to all holders of its
shares of Common Stock evidences of its indebtedness or assets
(excluding cash dividends or distributions payable out of consolidated
earnings or earned surplus and dividends or distributions referred to
in paragraph (a) above or in the paragraph immediately following this
paragraph) or rights,

6
<PAGE> 8

options or warrants, or convertible or exchangeable securities
containing the right to subscribe for or purchase shares of Common
Stock (excluding those referred to in paragraph (b) above), then in
each case the number of Warrant Shares thereafter purchasable upon the
exercise of each Warrant shall be determined by multiplying the number
of Warrant Shares theretofore purchasable upon the exercise of each
Warrant by a fraction, of which the numerator shall be the then current
market price per share of Common Stock (as determined in accordance
with paragraph (e) below) on the date of such distribution, and of
which the denominator shall be the then current market price per share
of Common Stock, less the then fair value (as determined in good faith
by the Board of Directors of the Company, whose determination shall be
conclusive) of the portion of the assets or evidences of indebtedness
so distributed or of such subscription rights, options or warrants, or
of such convertible or exchangeable securities applicable to one share
of Common Stock. Such adjustment shall be made whenever any such
distribution is made, and shall become effective on the date of
distribution retroactive to the record date for the determination of
stockholders entitled to receive such distribution.

In the event of distribution by the Company to all holders of
its shares of Common Stock of stock of a subsidiary or securities
convertible into or exercisable for such stock, then in lieu of an
adjustment in the number of Warrant Shares purchasable upon the
exercise of each Warrant, the Holder of each Warrant, upon the exercise
thereof at any time after such distribution, shall be entitled to
receive from the Company, such subsidiary or both, as the Company shall
determine, the stock or other securities to which such Holder would
have been entitled if such Holder had exercised such Warrant
immediately prior thereto regardless of whether the Warrants are
exercisable at such time, all subject to further adjustment as provided
in this subsection 9.1; provided, however, that no adjustment in
respect of dividends or interest on such stock or other securities
shall be made during the term of a Warrant or upon the exercise of a
Warrant.

(d) In case the Company shall sell and issue shares of Common
Stock (other than pursuant to rights, options, warrants, or convertible
securities initially issued before the date of this Agreement) or
rights, options, warrants or convertible securities containing the
right to subscribe for or purchase shares of Common Stock (excluding
shares, rights, options, warrants or convertible securities issued in
any of the transactions described in paragraphs (a), (b) or (c) above)
at a price per share of Common Stock (determined, in the case of such
rights, options, warrants or convertible securities, by dividing (w)
the total of the amount received or receivable by the Company
(determined as provided below) in

7
<PAGE> 9

consideration of the sale and issuance of such rights, options,
warrants or convertible securities, by (x) the total number of shares
of Common Stock covered by such rights, options, warrants or
convertible securities) lower than the then current market price per
share of Common Stock (as determined in accordance with paragraph (e)
below) in effect immediately prior to such sale and issuance, then the
number of Warrant Shares thereafter purchasable upon the exercise of
the Warrants shall be determined by multiplying the number of Warrant
Shares theretofore purchasable upon exercise by a fraction, of which
the numerator shall be the number of shares of Common Stock outstanding
on the date of issuance of such shares, rights, options, warrants or
convertible securities plus the number of additional shares of Common
Stock sold or subject to issuance pursuant to such rights, options,
warrants or convertible securities, and of which the denominator shall
be the number of shares of Common Stock outstanding on the date of
issuance of such shares, rights, options, warrants or convertible
securities plus the number of shares of Common Stock which the
aggregate consideration received or receivable (determined as provided
below) for such sale or issuance would purchase at such current market
price per share. Such adjustment shall be made successively whenever
such an issuance is made. For the purposes of such adjustments, the
consideration received or receivable by the Company for rights,
options, warrants or convertible securities shall be deemed to be the
consideration received by the Company for such rights, options,
warrants or convertible securities, plus the consideration or premiums
stated in such rights, options, warrants or convertible securities to
be paid for the shares of Common Stock covered thereby. In case the
Company shall sell and issue shares of Common Stock, or rights,
options, warrants or convertible securities containing the right to
subscribe for or purchase shares of Common Stock, for a consideration
consisting, in whole or in part, of property other than cash or its
equivalent, then in determining the "price per share of Common Stock"
and the "consideration received or receivable by the Company" for
purposes of the first sentence of this paragraph (d), the Board of
Directors shall determine, in its discretion, the fair value of said
property, and such determination, if made in good faith, shall be
binding upon all Holders.

(e) For the purpose of any computation under paragraphs (b),
(c) and (d) of this Section, the current market price per share of
Common Stock at any date shall be the daily closing price of the
Company's Common Stock, as reported by the American Stock Exchange. The
closing price for such day shall be the last such reported sales price
regular way or, in case no such reported sale takes place on such day,
the average of the closing bid and asked prices regular way for such
day, in each case on the principal national securities exchange on

8
<PAGE> 10
which the shares of Common Stock are listed or admitted to trading or,
if not listed or admitted to trading, the average of the closing bid
and asked prices of the Common Stock in the over-the-counter market as
reported by NASDAQ or any comparable system. In the absence of one or
more such quotations, the Board of Directors of the Company shall
determine the current market price, in good faith, on the basis of
such quotations as it considers appropriate. Notwithstanding the
foregoing, for the purpose of any calculation under paragraph (d)
above (A) with respect to any issuance of options under the Company's
employee or director compensation stock option plans as in effect or
as adopted by the Board of Directors of the Company on the date
hereof, the term "current market price" in such instances shall mean
the fair market price on the date of the issuance of any such option
determined in accordance with the Company's employee compensation
stock option plans as in effect or as adopted by the Board of
Directors of the Company on the date hereof; (B) with respect to any
issuances of Common Stock (or rights, options, warrants or convertible
securities containing the right to subscribe for or purchase shares of
Common Stock) in connection with bona fide corporate transactions
(other than issuances in such transactions for cash or similar
consideration), the term "fair market price" shall mean the fair
market price per share as determined in arm's-length negotiations by
the Company and such other parties (other than affiliates or
subsidiaries of the Company) to such transactions as reflected in the
definitive documentation with respect thereto, unless such
determination is not reasonably related to the closing market price on
the date of such determination; and (c) with respect to any issuance
of the Company's common stock for cash or similar consideration in a
firm commitment underwriting, the current fair market price shall be
the price the shares are sold at, regardless of whether such price is
higher or lower than the quoted price on the date of the sale and
therefore no adjustment will be made.

(f) In any case in which this Section 9.1 shall require
that any adjustment in the number of Warrant Shares be made effective
as of immediately after a record date for a specified event, the
Company may elect to defer until the occurrence of the event the
issuing to the Holder of any Warrant exercised after that record date
the shares of Common Stock and other securities of the Company, if
any, issuable upon the exercise of any Warrant over and above the
shares of Common Stock and other securities of the Company, if any,
issuable upon the exercise of any Warrant prior to such adjustment;
provided, however, that the Company shall deliver to the holder a due
bill or other appropriate instrument evidencing the holder's right to
receive such additional

9
<PAGE> 11
shares or securities upon the occurrence of the event requiring such
adjustment.

(g) No adjustment in the number of Warrant Shares
purchasable hereunder shall be required unless such adjustment would
require an increase or decrease of at least one percent (1%) in the
number of Warrant Shares purchasable upon the exercise of each
Warrant; provided, however, that any adjustments which by reason of
this paragraph (g) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All
calculations shall be made to the nearest one-thousandth of a share.

(h) Whenever the number of Warrant Shares purchasable
upon the exercise of each Warrant is adjusted, as herein provided, the
Warrant Price payable upon the exercise of each Warrant shall be
adjusted by multiplying such Warrant Price immediately prior to such
adjustment by a fraction, of which the numerator shall be the number
of Warrant Shares purchasable upon the exercise of such Warrant
immediately prior to such adjustment, and of which the denominator
shall be the number of Warrant Shares purchasable immediately
thereafter.

(i) No adjustment in the number of Warrant Shares
purchasable upon the exercise of each Warrant need be made under
paragraphs (b), (c) and (d) if the Company issues or distributes to
each Holder of Warrants the rights, options, warrants, or convertible
or exchangeable securities, or evidences of indebtedness or assets
referred to in those paragraphs which each Holder of Warrants would
have been entitled to receive had the Warrants been exercised prior to
the happening of such event or the record date with respect thereto
regardless of whether the Warrants are exercisable at the time of the
happening of such event or at the time of any record date with respect
thereto. No adjustment need be made for a change in the par value of
the Warrant Shares.

(j) For the purpose of this Section 9.1, the term "shares
of Common Stock" shall mean (i) the class of stock designated as the
Common Stock of the Company at the date of this Agreement, or (ii) any
other class of stock resulting from successive changes or
reclassifications of such shares consisting solely of changes in par
value, or from par value to no par value, or from no par value to par
value. In the event that at any time, as a result of an adjustment
made pursuant to paragraph (a) above, the Holders shall become
entitled to purchase any securities of the Company other than shares
of Common Stock, thereafter the number of such other securities so
purchasable upon exercise of each Warrant and the Warrant Price of
such securities shall be subject to adjustment from time to time in a
manner and on terms as

10
<PAGE> 12
nearly equivalent as practicable to the provisions with respect to the
Warrant Shares contained in paragraphs (a) through (i), inclusive,
above, and the provisions of Section 5 and Sections 9.2 through 9.5,
inclusive, with respect to the Warrant Shares, shall apply on like
terms to any such other securities.

(k) Upon the expiration of any rights, options, warrants
or conversion or exchange privileges, if any thereof shall not have
been exercised, the Warrant Price and the number of shares of Common
Stock purchasable upon the exercise of each Warrant shall, upon such
expiration, be readjusted and shall thereafter be such as it would
have been had it been originally adjusted (or had the original
adjustment not been required, as the case may be) as if (A) the only
shares of Common Stock so issued were the shares of Common Stock, if
any, actually issued or sold upon the exercise of such rights,
options, warrants or conversion or exchange rights and (B) such shares
of Common Stock, if any, were issued or sold for the consideration
actually received by the Company upon such exercise plus the aggregate
consideration, if any, actually received by the Company for the
issuance, sale or grant of all such rights, options, warrants or
conversion or exchange rights whether or not exercised; provided,
however, that no such readjustment shall have the effect of increasing
the Warrant Price or decreasing the number of Warrant Shares by an
amount in excess of the amount of the adjustment initially made with
respect to the issuance, sale or grant of such rights, options,
warrants or conversion or exchange rights.

9.2. Voluntary Adjustment by the Company. The Company may, at its
option, at any time during the term of the Warrants, reduce the then current
Warrant Price to any amount determined appropriate by the Board of Directors of
the Company.

9.3. Notice of Adjustment. Whenever the number of Warrant Shares
purchasable upon the exercise of each Warrant or the Warrant Price of such
Warrant Shares is adjusted, as herein provided, the Company shall promptly mail
by first class, postage prepaid, to each Holder notice of such adjustment or
adjustments and a certificate of a firm of independent public accountants
selected by the Board of Directors of the Company (who may be the regular
accountants employed by the Company) setting forth the number of Warrant Shares
purchasable upon the exercise of each Warrant and the Warrant Price of such
Warrant Shares after such adjustment and setting forth a brief statement of the
facts requiring such adjustment and setting forth the computation by which such
adjustment was made. Such certificate, absent manifest error, shall be
conclusive evidence of the correctness of such adjustment.

11
<PAGE> 13
9.4. No Adjustment for Dividends. Except as provided in Section
9.1, no adjustment in respect of any dividends shall be made during the term of
a Warrant or upon the exercise of a Warrant.

9.5. Preservation of Purchase Rights Upon Merger, Consolidation,
etc. In case of any consolidation of the Company with or merger of the Company
into another corporation or in case of any sale, transfer or lease to another
corporation of all or substantially all the property of the Company, the
Company or such successor or purchasing corporation, as the case may be, shall
execute with each Holder an agreement that each Holder shall have the right
thereafter upon payment of the Warrant Price in effect immediately prior to
such action to purchase upon exercise of each Warrant the kind and amount of
shares and other securities and property which he would have owned or have been
entitled to receive after the happening of such consolidation, merger, sale,
transfer or lease had such Warrant been exercised immediately prior to such
action regardless of whether the Warrants are exercisable at the time of such
action; provided, however, that no adjustment in respect of dividends, interest
or other income on or from such shares or other securities and property shall
be made during the term of a Warrant or upon the exercise of a Warrant. Such
agreement shall provide for adjustments, which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section 9. The
provisions of this Section 9.5 shall similarly apply to successive
consolidations, mergers, sales, transfers or leases.

9.6. Statement on Warrants. Irrespective of any adjustments in the
Warrant Price or the number or kind of shares purchasable upon the exercise of
the Warrants, Warrants theretofore or thereafter issued may continue to express
the same price and number and kind of shares as are stated in the Warrants
initially issuable pursuant to this Agreement.

10. Fractional Interests. The Company shall not be required to
issue fractional Warrant Shares on the exercise of Warrants. If more than one
Warrant shall be presented for exercise in full at the same time by the same
Holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section
10, be issuable on the exercise of any Warrant (or specified portion thereof),
the Company shall pay an amount in cash equal to the closing price for one
share of the Common Stock, as determined in accordance with paragraph (e) of
Section 9.1, on the

12
<PAGE> 14
trading day immediately preceding the date the Warrant is presented for
exercise, multiplied by such fraction.

11. Registration Under the Securities Act of 1933. Holder
represents and warrants to the Company that Holder will not dispose of any such
Warrants or Warrant Shares except pursuant to (i) an effective registration
statement, or (ii) an applicable exemption from registration under the
Securities Act of 1933 (the "Act"). In connection with any sale by Holder
pursuant to clause (ii) of the preceding sentence, Holder shall furnish to the
Company an opinion of counsel reasonably satisfactory to the Company to the
effect that such exemption from registration is available in connection with
such sale.

11a. Registration on Demand

(a) One time, upon the written request of the Holder, the Company
will notify all other holders and upon written request the Holder and other
persons who together with Holder own five percent of the Warrant Stock issued
in connection with the Offering ("Requesting Holders") that the Company effect
registration, qualification or compliance under the Securities Act and state
securities laws of all or part of the Registrable Securities of the Requesting
Holders and specifying the intended method of disposition thereof, the Company
shall (i) promptly thereupon give written notice of the proposed registration
to all other holder of Warrant Stock issued in connection with the Offering and
(ii) effect, as soon as practicable and within 90 days after such request, all
such registrations, qualifications and compliances under the Securities Act and
state securities law of the Registrable Securities which the Company has been
so requested to register by Requesting Holders and any other holder or holders
joining in such registration as specified in a written request received by the
Company within 15 business days after the Company's notice to the extent
requisite to permit the sale and distribution of such securities; provided,
however, that the Company shall not be obligated to effect a registration under
the Securities Act pursuant to this Section 3 before October 1, 1993.

(b) A registration requested pursuant to this Section will not be
deemed to have been effected (i) unless it has become effective and remained
effective for the period of not less than 180 days.

(c) If Requesting Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so
advise the Company as a part of their request made pursuant to this Section and
provide the name of the managing underwriter or underwriters that the majority
in interest of such Requesting Holders would propose to employ in connection

13
<PAGE> 15
with the public offering proposed to be made pursuant to the registration
requested; provided that if the Company reasonably objects to any managing
underwriter or underwriters proposed by Requesting Holders, the Requesting
Holders shall propose another managing underwriter or underwriters. If the
sale proposed by the Requesting Holders is to be effected pursuant to an
underwritten public offering, the right of Holder to registration pursuant to
this Section 3 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting (unless Requesting Holders and such Holder) to the extent provided
herein. The Company and the Requesting Holders proposing to distribute their
securities through such underwriting shall enter into an underwriting agreement
in customary form with the underwriter or underwriters selected for such
underwriting, and shall execute powers of attorney and custodial agreements in
customary form for selling same.

12. Right to Redeem.

(a) Each or all of the Warrants may be redeemed at the election of
the Company at any time after October 31, 1994 at the price of $0.05 per
Warrant (the "Redemption Price"), or at any time after the issuing of the
Warrants if the Common Stock of the Company closes at $15.00 per share or
higher for a period of ten consecutive trading days.

(b) The election of the Company to redeem any Warrants shall be
evidenced by a resolution of the Board of Directors to redeem all but not less
than all of the Warrants and shall for a date of redemption ("Redemption Date")
at least 60 days after notice to the Warrant Holders.

(c) Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 60 days prior to the Redemption Date to
each registered holder of Warrants to be called at his last address appearing
in the Warrants register.

All notices of redemption shall state:

(1) The Redemption Date,
(2) the Redemption Price,
(3) that upon the Redemption Date the Redemption Price
will become due and payable upon each such Warrant,
(4) the Warrant Price and that the right to exercise a
Warrant to be redeemed will terminate at the close of
business on the Redemption Date and the place or
places where such Warrants may be surrendered to be
exercised, and
(5) the place where such Warrants are to be surrendered
for payment of the Redemption Price.

14
<PAGE> 16
Notice of redemption of Warrants to be redeemed at the election of the Company
shall be given by the Company.

(d) Notice of redemption having been given as aforesaid, the
Warrants so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price. Upon surrender of any such Warrant for
redemption in accordance with said notice such Warrant shall be redeemed by the
Company at the Redemption Price. If any Warrant redeemed shall not be so paid
upon surrender thereof for redemption, the principal shall, until paid, bear
interest from the Redemption Date at the rate of the prime rate of interest as
announced by the Bank.

13. Certificate to Bear Legends. The Warrants shall be subject to
a stop-transfer order and the certificate or certificates therefor shall bear
the following legend by which each Holder shall be bound:

"THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SHARES
OF COMMON STOCK OR OTHER SECURITIES ISSUABLE UPON EXERCISE
THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (I) AN
EFFECTIVE REGISTRATION STATEMENT, OR (II) AN APPLICABLE
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933.
ANY SALE PURSUANT TO CLAUSE (II) OF THE PRECEDING SENTENCE
MUST BE ACCOMPANIED BY AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH EXEMPTION
FROM REGISTRATION IS AVAILABLE IN CONNECTION WITH SUCH SALE."

The Warrant Shares or other securities issued upon exercise of the
Warrants shall, unless issued pursuant to an effective registration statement,
be subject to a stop-transfer order and the certificate or certificates
evidencing any such Warrant Shares or securities shall bear the following
legend by which the Holder thereof shall be bound:

"THE SHARES OR OTHER SECURITIES REPRESENTED BY THIS
CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (I)
AN EFFECTIVE REGISTRATION STATEMENT, OR (II) AN APPLICABLE
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933.
ANY SALE PURSUANT TO CLAUSE (II) OF THE PRECEDING SENTENCE
MUST BE ACCOMPANIED BY AN OPINION OF COUNSEL TO THE EFFECT
THAT SUCH EXEMPTION FROM REGISTRATION IS AVAILABLE IN
CONNECTION WITH SUCH SALE."

15
<PAGE> 17
14. No Rights as Stockholders; Notice to Holders. Nothing
contained in this Agreement or in any of the Warrants shall be construed as
conferring upon the Holders or their transferees the right to vote or to
receive dividends or to consent or to receive notice as stockholders in respect
of any meeting of stockholders for the election of directors of the Company or
any other matter, or any rights whatsoever as stockholders of the Company. If,
however, at any time prior to the expiration of the Warrants and prior to their
exercise, any of the following events shall occur:

(a) the Company shall declare any dividend payable in any
securities upon its shares of Common Stock or make any distribution
(other than a cash dividend) to the holders of its shares of Common
Stock; or

(b) the Company shall offer to the holders of its shares
of Common Stock any additional shares of Common Stock or securities
convertible into or exchangeable for shares of Common Stock or any
right to subscribe to or purchase any thereof; or

(c) a dissolution, liquidation or winding up of the
Company (other than in connection with a consolidation, merger, sale,
transfer or lease or all or substantially all of its property, assets,
and business as an entirety) shall be proposed,

then in any one or more of said events the Company shall (a) give notice in
writing of such event to the Holders as provided in Section 15 hereof and (b)
if there are more than 100 Holders, cause notice of such event to be published
once in The Wall Street Journal (national edition), such giving of notice and
publication to be completed at least 15 days prior to the date fixed as a
record date or the date of closing the transfer books for the determination of
the stockholders entitled to such dividend, distribution, or subscription
rights, or for the determination of stockholders entitled to vote on such
proposed dissolution, liquidation or winding up. Such notice shall specify
such record date or the date of closing the transfer books, as the case may be.
Failure to publish, mail or receive such notice or any defect therein or in the
publication or mailing thereof shall not affect the validity of any action
taken in connection with such dividend, distribution or subscription rights, or
such proposed dissolution, liquidation or winding up.

15. Notices. Any notice pursuant to this Agreement to be given or
made by the Holder of any Warrant or Warrant Shares to or on the Company shall
be sufficiently given or made if sent by first-class mail, postage prepaid,
addressed as follows:

16
<PAGE> 18
Benton Oil and Gas Company
300 Esplanade Drive
Suite 2000
Oxnard, California 93030
Attention: David H. Pratt

Notices or demands authorized by this Agreement to be given or made to or on
the Holder of any Warrant or Warrant Shares shall be sufficiently given or made
(except as otherwise provided in this Agreement) if sent by registered mail,
return receipt requested, postage prepaid, addressed to such Holder at the
address of such Holder as shown on the Warrant Register or the Common Stock
Register, as the case may be.

16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without
giving effect to principles of conflict of laws.

17. Supplements and Amendments. The Company and the Holders
may from time to time supplement or amend this Agreement in order to cure any
ambiguity or to correct or supplement any provision contained herein which may
be defective or inconsistent with any other provision herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which shall not be
inconsistent with the provisions of the Warrants and which shall not adversely
affect the interests of the Holders. Any amendment to this Agreement may be
effected with the consent of Holders of at least 66 2/3% of the Warrants (for
this purpose Warrant Shares shall be deemed to be Warrants in the proportion
that Warrant Shares are then issuable upon the exercise of Warrants); provided
that, any amendment which shall have the effect of materially adversely
affecting the interests of any Holder shall not be effective with respect to
such Holder if such Holder shall not have consented thereto.

18. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Holders shall bind and
inure to the benefit of their respective successors and assigns hereunder.

19. Merger or Consolidation of the Company. So long as this
Agreement remains in effect, the Company will not merge or consolidate with or
into, or sell, transfer or lease all or substantially all of its property to,
any other corporation unless

17
<PAGE> 19
the successor or purchasing corporation, as the case may be (if not the
Company), shall expressly assume, by supplemental agreement executed and
delivered to the Holders, the due and punctual performance and observance of
each and every covenant and condition of this Agreement to be performed and
observed by the Company.

20. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company
and the Holders, any legal or equitable right, remedy or claim under this
Agreement, but this Agreement shall be for the sole and exclusive benefit of
the Company and the Holders of the Warrants and Warrant Shares.

21. Captions. The captions of the sections and subsections
of this Agreement have been inserted for convenience and shall have no
substantive effect.

22. Counterparts. This Agreement may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original;
but such counterparts together shall constitute but one and the same
instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed on the day, month and year first above written.

BENTON OIL AND GAS COMPANY

By:
------------------------------
David H. Pratt,
Vice President-Finance

(CORPORATE SEAL)

Attest:

- ---------------------------
Toni L. Jackson

<PAGE> 1
[EMENS, KEGLER, BROWN, HILL & RITTER LETTERHEAD]

EXHIBIT 5.1

FORM OF OPINION

, 1996
------------

Benton Oil and Gas Company
1145 Eugenia Place, Suite 200
Carpinteria, CA 93013

Gentlemen:

We have acted as counsel for Benton Oil and Gas Company, a Delaware
corporation (the "Company") in connection with the registration under the
Securities Act of 1933, as amended, of up to 348,500 shares of common stock of
the Company (the "Common Stock"). In this connection, we have examined the
Certificate of Incorporation, the Bylaws and the respective Amendments thereto,
the Directors and Stockholder Minutes of the Company and the Registration
Statement filed with the Securities and Exchange Commission and Exhibits
thereto, and such other documents of the Company as we have deemed necessary to
the opinion hereinafter expressed.

We are of the opinion that the issuance of the shares of common stock
has been duly authorized and when (a) the Registration Statement filed with the
Securities and Exchange Commission has become effective, (b) the applicable
provisions of the Securities Act of 1933, as amended, and such Blue Sky and
Securities Laws as may be applicable have been complied with, (c) the Warrants
have been exercised pursuant to the terms of the Warrant Agreement, and (d) the
shares have been issued and delivered upon exercise of the Warrants in the
manner set forth in the Warrant Agreement and the Prospectus (in the form filed
by the Company pursuant to Rule 424(b) under the Securities Act of 1933, as
amended), against payment therefore, these shares of common stock will have been
fully paid, legally issued, validly executed, authenticated, and delivered, and
will be non-assessable.

We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the reference to us under the heading "Legal
Matters."

Very truly yours,

Emens, Kegler, Brown, Hill & Ritter Co., L.P.A.

By: [FORM OF OPINION]
---------------------------------------------
Jack A. Bjerke, Vice President

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[EMENS, KEGLER, BROWN, HILL & RITTER LETTERHEAD]

EXHIBIT 23.2

January 10, 1996

Benton Oil and Gas Company
1145 Eugenia Place, Suite 200
Carpinteria, CA 93013

Gentlemen:

We hereby consent to the reference to Emens, Kegler, Brown, Hill &
Ritter Co., L.P.A. appearing under the heading "Legal Matters" in the
Registration Statement on the Form S-3 for the offering of common stock, and any
amendments thereto, and in the prospectus of the Company relating to the
offering of the common stock.

Very truly yours,

Emens, Kegler, Brown, Hill & Ritter Co., L.P.A.

By: /s/ John R. Thomas
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John R. Thomas, Vice President

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CONSENT OF INDEPENDENT PETROLEUM ENGINEER

Gentlemen:

Huddleston & Co., Inc. hereby consents to the use of its name, use of
its audit report, and reference to it regarding its audit of the Benton Oil and
Gas Company Reserve Reports, prepared by Benton Oil and Gas Company, dated March
21, 1995, in the Form S-3 Registration Statement of Benton Oil and Gas Company
registering the issuance of shares of its common stock.

HUDDLESTON & CO., INC.

/s/ Peter D. Huddleston
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Peter D. Huddleston, P.E., President

January 9, 1996