Joint Exploration Agreement

Bridas Energy USA, Inc. letterhead]


April 30, 2003


Cadence Resources Corporation P.O. Box 2056 Walla Walla, Washington 99362


Re: Joint Exploration Agreement
Northeast Logansport Prospect (the "Prospect")
DeSoto Parish, Louisiana


Gentlemen:


This letter when accepted by you in the space provided below, will constitute a joint exploration agreement that evidences the understandings and obligations between Bridas Energy USA, Inc., a Delaware corporation ("BEUSA") and Cadence Resources Corporation, a Utah corporation ("Cadence"), relating to the exploration and development of the Prospect (this "Agreement").


1. PROSPECT LEASES
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Cadence is the owner of leasehold working interests in the oil and gas leases covering lands located in Sections 27, 28, 33, 34, and the E/2 of both Sections 29 and 32, T-13-N, R-15-W, DeSoto Parish Louisiana, which leases are described in Exhibit "A-1 " attached to this Agreement (the "Prospect Leases"). The lands covered by the Prospect Leases are depicted by yellow shading on the plat attached to this Agreement as Exhibit "A-2" (the "Plat"). Cadence represents that, its interests in the Prospect Leases are 100% working interest and an approximate 80% weighted average net revenue interest.


2. PROSPECT ASSEMBLY COSTS
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As part of the consideration for Cadence's execution and return of this Agreement, BEUSA agrees to pay in cash to Cadence the sum of $50,000. Such payment shall serve as reimbursement for BEUSA's share of the total of geological, overhead, seismic, lease acquisition, drafting, and other generation costs relating to the assembly of the Prospect. All subsequent acquisitions of leases on lands covered by the AMI shall be borne proportionately by the parties hereto according to their proportionate ownership set out below.


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3. INITIAL ASSIGNMENT
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Upon receipt of such consideration, Cadence shall assign to BEUSA, by recordable conveyance containing a special warranty of title only, an undivided 55% leasehold working interest in the Prospect Leases. This undivided 55% working interest shall be subject to its proportionate share of existing landowners' royalties and an undivided 2% overriding royalty interest to be assigned by Cadence to the generators of the Prospect. The reserved overriding royalty interest shall be free of all cost and expense of drilling and producing, but shall bear its proportionate share of all severance, production and windfall profits taxes. The execution of this Agreement, the payment by BEUSA of the cash consideration, the execution by the parties of the Operating Agreement described below, and the execution by Cadence of the initial assignment above shall occur on or before April 30, 2003 at a mutually acceptable location (the "Closing").


4. ACREAGE SELECTION
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Within 60 days from the execution date of this Agreement, BEUSA shall select, in writing furnished to Cadence, 640 acres covered by the Prospect Leases (the "Selection Acreage"), which shall include the location for the first well to be drilled on the Prospect. The Selection Acreage shall consist of one (1) regular section, two (2) adjacent half-sections, or four (4) contiguous quarter sections, each in the shape of a square.


5. INITIAL WELL
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As additional consideration for this Agreement, BEUSA agrees to commence or cause to be commenced the drilling of a well in search of oil and/or natural gas in commercial quantities (the "Initial Well") on the Selection Acreage. The Initial Well will be drilled at a location of BEUSA's choice. Drilling operations shall be commenced on or before 150 days from the execution date of this Agreement. The Initial Well shall be drilled in a good and workmanlike manner to a depth of 10,000 feet or to the Cotton Valley formation, whichever is the lesser depth (the "Contract Depth"). The Initial Well shall be drilled at the sole risk and expense of BEUSA through completion and, if such well is successfully completed as a producer of oil and/or gas in commercial quantities, into the tanks or pipeline connection without cost to Cadence. Should BEUSA elect to abandon the Initial Well, before or after making a completion attempt, Cadence will have the right to assume operations thereof at its own risk for its own account and will not deliver the Secondary Assignment provided below.


6. SECONDARY ASSIGNMENT FOLLOWING INITIAL WELL
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In addition to the 55% working interest in the Prospect Leases, as conveyed by the initial assignment in Paragraph 3, Cadence hereby agrees to convey an additional 20% working interest in


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the Prospect Leases when the Initial Well has been drilled to the objective depth described in paragraph 5 (the "Secondary Assignment"). The Secondary Assignment shall be limited to the Selection Acreage and shall be subject to its proportionate share of existing landowners' royalties and an undivided 2% overriding royalty interest. The reserved overriding royalty interest shall be free of all cost and expense of drilling and producing, but shall bear its proportionate share of all severance, production and windfall profits taxes.


7. OPERATING AGREEMENT
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Following completion of the Initial Well as a producer of oil and/or natural gas, all operations hereunder shall be conducted pursuant to the terms and provisions of the A.A.P.L. Form 610-1989 Model Form Operating Agreement attached hereto as Exhibit "B" (the "Operating Agreement"), naming BEUSA as Operator. BEUSA and Cadence agree to execute and file for record the Model Form Recording Supplement to the Operating Agreement and Financing Statement attached to the Operating Agreement. Each party agrees to abide by all of the terms, provisions and conditions thereof; provided, however, in the event of a conflict between the terms of this Agreement and those of the Operating Agreement, the terms and provisions hereof shall prevail. The percentage interests in the Prospect Leases to be owned by the parties to this Agreement are set forth as follows:


Selection Acreage - ----------------- At closing


BEUSA
55%


Cadence 45%*
---------
100%


Upon Designating Selection Acreage


BEUSA 75%


Cadence 25%*
---------
100%


All Other Acreage - ----------------- At Closing and Thereafter


BEUSA
55%


Cadence 45%
---------
100%


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* Cadence's interest in the Initial Well shall be a carried working interest.
As such, Cadence shall not pay or bear any costs related to the
exploration, drilling, testing, equipping, completing, and producing the
Initial Well, and that such interest shall be cost-free to Cadence as to
the oil and condensate produced through the initial deposit of such oil or
condensate into the tanks, and, as to gas produced, through the initial
delivery of gas to the purchaser of same; provided, however, (i) that
Cadence shall have to pay and bear its proportionate share of the costs
related to the operation and maintenance of the Initial Well which occur
subsequent in time to the initial deposit of oil or condensate or initial
delivery of such gas and (ii) that Cadence shall also have to pay and bear
its proportionate share of the costs related to the recompleting, reworking
or plugging back of the Initial Well once completed as a producer of oil or
gas, as well as all of the costs related to the drilling and producing of
any wells subsequent to the Initial Well.


8. SUBSTITUTE WELL
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In the event the Init ...