Prospectus ENDEAVOUR INTERNATIONAL CORP - 3-16-2011

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          The information in this preliminary prospectus supplement is not complete and may be changed. This preliminary prospectus supplement
          and the accompanying prospectus are part of an effective registration statement filed w ith the Securities and Exchange Commis sion. This
          preliminary prospectus supplement and the accompanying prospectus are not an offer to sell nor do they seek an offer to buy these
          securities in any jurisdiction where the offer or sale is not permitted.


                                                                                                                 Filed Pursuant to Rule 424(b )(2)
                                                                                                                     Registration No. 333-163781

                                            SUBJ ECT TO COMPLETION, DATED MARCH 15, 2011


         PRELIMINARY PROSPECTUS S UPPLEMENT
         (To pros pectus dated February 9, 2010)



                                                             8,000,000 Shares


                                                              Common Stock
                                                                   $        per share
              We are offering 8,000,000 shares of our co mmon stock. The underwriters may also purchase up to an additional
         1,200,000 shares from us, at the public offering price, less the underwrit ing discount, with in 30 days fro m the date of this
         prospectus supplement to cover over-allot ments, if any.

             Our co mmon stock is quoted on the New York Stock Exchange under the symbol “END” and on the London Stock
         Exchange under the symbol “ENDV.” On March 14, 2011, the last sales price of the shares as reported on the NYSE A mex,
         where our co mmon stock was quoted prior to March 15, 2011, was $12.60 per share.




              Investing in our common stock involves risks. See “Risk Factors” beginning on page S-18 of
         this prospectus supple ment.

              Neither the Securities and Exchange Co mmission nor any state securities commission has approved or disapproved of
         these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or comp lete. Any
         representation to the contrary is a criminal offense.




                                                                                                                      Per Share              Total


         Public Offering Price                                                                                        $                  $
         Underwrit ing Discount                                                                                       $                  $
         Proceeds, Before Expenses, to Us                                                                             $                  $

               The underwriters expect to deliver the shares to purchasers on or about March , 2011.




                                                                  Book-Running Manager

                                                                          Citi
                               Co-Managers


                         Canaccord Genuity
               C. K. Cooper & Company
                              Global Hunter Securities
                         Rodman & Renshaw, LLC
March , 2011
                                                TABLE OF CONTENTS

                                                 Prospectus supplement


                                                                                                    Page


About This Prospectus Supplement and the Accompanying Prospectus                                      S-ii
Where You Can Find More In formation                                                                  S-ii
Cautionary Statement Regard ing Forward-Looking Statements                                           S-iii
Summary                                                                                               S-1
Risk Factors                                                                                         S-18
Use of Proceeds                                                                                      S-31
Capitalization                                                                                       S-32
Price Range of Co mmon Stock                                                                         S-33
Div idend Policy                                                                                     S-33
Description of Capital Stock                                                                         S-34
Certain U.S. Federal Inco me Tax Consequences for Non-U.S. Holders of Our Co mmon Stock              S-40
Underwrit ing                                                                                        S-44
Legal Matters                                                                                        S-49
Experts                                                                                              S-49
Glossary of Oil and Natural Gas Terms                                                                 G-1


                                                       Prospectus


                                                                                                      Page


About this Prospectus                                                                                   1
The Co mpany                                                                                            1
Risk Factors                                                                                            2
Cautionary Statement Concerning Forward -Looking Statements                                            16
Use of Proceeds                                                                                        17
Ratios of Earn ings to Fixed Charges and Earn ings to Fixed Charges and Preferred Stock Dividends      18
Description of Debt Securit ies                                                                        19
Description of Capital Stock                                                                           29
Description of Warrants                                                                                34
Plan of Distribution                                                                                   35
Legal Matters                                                                                          37
Experts                                                                                                37
Where You Can Find More In formation                                                                   37
Incorporation of Certain Documents by Reference                                                        37


                                                           S-i
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                      ABOUT THIS PROSPECTUS S UPPLEMENT AND THE ACCOMPANYING PROSPECTUS

               This document is organized in two parts. The first part is the prospectus supplement, which describes our business and
         the specific terms of this offering of our co mmon stock. The second part is the accompanying prospectus, which gives more
         general info rmation, some of which may not apply to our co mmon stock or this offering. If the info rmation relating to the
         offering varies between the prospectus supplement and the accompanying prospectus, you should rely on the information in
         this prospectus supplement.

               You should rely only on the info rmation contained in or incorporated by reference into this prospectus supplement, the
         accompanying prospectus and any related free writ ing prospectus. Neither we nor the underwriters have authorized any
         dealer, sales man or other person to provide you with additional o r different informat ion. If anyone provides you with
         different or inconsistent information, you should not rely on it. This prospectus supplement and the accompanying
         prospectus are not an offer to sell or the solicitation of an offer to buy any securities other than the securities to which they
         relate and are not an offer to sell or the solicitation of an offer to buy securities in any ju risdiction to any person to wh om it
         is unlawfu l to make an offer or solicitation in that jurisdiction. You should not assume that the information contained in this
         prospectus supplement is accurate as of any date other than the date on the front cover of this prospectus supplement, or tha t
         the information contained in any document incorporated by reference is accurate as of any date other than the date of the
         document incorporated by reference, regardless of the time of delivery of this prospectus supplement or any sale of a
         security.

              Unless otherwise indicated or the context otherwise requires, all references in this prospectus supplement to “we,”
         “our,” “us,” “the Company” or “Endeavour” are to Endeavour International Corporation and its subsidiaries.


                                             WHERE YOU CAN FIND MORE INFORMATION

              We file annual, quarterly and current reports and other informat ion with the Securit ies and Exchange Co mmission (the
         “SEC”) (File No. 001-32212) pursuant to the Securities Exchange Act of 1934 (the “Exchange Act”). You may read and
         copy any documents that are filed at the SEC’s public reference roo m at 100 F Street, N.E., Washington, D.C. 20549. You
         may also obtain copies of these documents at prescribed rates from the public reference section of the SEC at its Washington
         address. Please call the SEC at 1-800-SEC-0330 for further informat ion.

               Our filings are also available to the public through the SEC’s website at http://www.sec.gov .

               The SEC allo ws us to “incorporate by reference” information that we file with them, wh ich means that we can disclose
         important informat ion to you by referring you to documents previously filed with the SEC. The in formation incorporated by
         reference is an important part of this prospectus supplement, and the informat ion that we later file with the SEC will
         automatically update and supersede this informat ion. The fo llo wing documents we filed with the SEC pursuant to the
         Exchange Act are incorporated herein by reference:

               • our Annual Report on Form 10-K fo r the year ended December 31, 2010;

               • our Current Reports on Form 8-K filed on February 9, 2011 and March 14, 2011 (excluding any informat ion
                 furnished pursuant to Item 2.02 or Item 7.01 of any such Current Report on Form 8-K); and

               • the description of our co mmon stock contained in our registration statement on Form 8-A filed on March 14, 2011,
                 including any other amend ments or reports filed for the purpose of updating such description.

               These reports contain important information about us, our financial condition and our results of operations.


                                                                         S-ii
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               All future documents filed pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act (excluding any
         informat ion furnished pursuant to Item 2.02 o r Item 7.01 on any Current Report on Form 8-K) before the termination of the
         offering of securities under this prospectus supplement shall be deemed to be incorporated in this prospectus supplement by
         reference and to be a part hereof fro m the date of filing of such documents. Any statement contained herein, or in a
         document incorporated or deemed to be incorporated by reference herein, shall be deemed to be modified or superseded for
         purposes of this prospectus supplement to the extent that a statement contained herein or in any subsequently filed document
         that also is or is deemed to be incorporated by reference herein, modifies or supersedes such sta tement. Any such statement
         so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus
         supplement.

             You may request a copy of these filings at no cost by writing or telephoning us at the following address and telephone
         number:


                                                       Endeavour International Corporation
                                                         1001 Fannin Street, Suite 1600
                                                             Houston, Texas 77002
                                                                 (713) 307-8700
                                                         Attention: Corporate Secretary

             We also maintain a website at http://www.endeavourcorp.com . However, the informat ion on, or accessible through, our
         website is not part of this prospectus supplement.


                         CAUTIONARY S TATEMENT REGARDING FORWARD -LOOKING STATEMENTS

               Certain matters discussed or incorporated by reference in this prospectus supplement are “forward-looking statements”
         intended to qualify for the safe harbors fro m liab ility established by the Private Securities Litigation Reform Act of 1995,
         Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E o f the Exchange Act. These
         forward-looking statements include statements that express a belief, expectation, or intention, as well as those that are not
         statements of historical fact, and may include projections and estimates concerning the timing and success of specific
         projects and our future production, revenues, income and capital spending. Our fo rward -looking statements are generally
         accompanied by words such as “estimate,” “project,” “predict,” “believe,” “expect,” “anticipate,” “potential,” “plan,” “goal”
         or other words that convey the uncertainty of future events or outcomes. We caution you not to rely on them unduly. In
         particular, this prospectus supplement contains or incorporates by reference forward-looking statements pertaining to the
         following:

               • our future financial position;

               • our business strategy;

               • budgets;

               • projected costs, savings and plans;

               • objectives of management for future operations;

               • legal strategies; and

               • legal proceedings.

               We have based these forward-looking statements on our current expectations and assumptions about future events.
         While our management considers these expectations and assumptions to be reasonable, they are inherently subject to
         significant business, economic, co mpetitive, regulatory and other risks, contingencies and uncertainties, most of which are
         difficult to predict and many of which are beyond our control. These risks, contingencies and uncertainties, which may not
         be exhaustive, relate to, among other matters, the following:

               • discovery, estimat ion, development and replacement of oil and gas reserves;
S-iii
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               • decreases in proved reserves due to technical or economic factors;

               • drilling of wells and other planned explo itation activit ies;

               • timing and amount of future production of oil and gas;

               • the volatility of oil and gas prices;

               • availability and terms of cap ital;

               • operating costs such as lease operating expenses, admin istrative costs and other expenses;

               • our future operating or financial results;

               • amount, nature and timing of capital expenditures, including future develop ment costs;

               • cash flow and anticipated liquidity;

               • availability of drilling and production equipment;

               • uncertainties related to drilling and production operations in a new region;

               • cost and access to natural gas gathering, treatment and pipeline facilities;

               • business strategy and the availability of acquisition opportunities; and

               • factors not known to us at this time.

              Any of these factors, or any combination of these factors, could materially affect our future financial condition or
         results of operations and the ultimate accuracy of a forward-looking statement. The forward-looking statements are not
         guarantees of our future performance, and our actual results and future developments may differ materially fro m those
         projected in the forward-looking statements. In addition, any or all of our forward-looking statements included or
         incorporated by reference in this prospectus supplement may turn out to be incorrect. They can be affected by inaccurate
         assumptions we might make or by known or unknown risks and uncertainties, including those mentioned in “Risk Factors”
         beginning on page S-18 o f this prospectus supplement and in our Annual Report on Form 10-K fo r the year ended
         December 31, 2010. These forward-looking statements speak only as of the date of this prospectus supplement, or, if earlier,
         as of the date they were made. Except as required by law, we undertake no obligat ion to update publicly or release any
         revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus supplement.
         These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.


                                                                         S-iv
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                                                                      SUMMARY

                  This summary highlights selected information contained elsewhere in this prospectus supplement, the accompanying
             prospectus and the documents we incorporate by reference. It does not contain all of the information you should consider
             before making an investment decision. You should read the entire prospectus supplement, the accompanying prospectus, the
             documents incorporated by reference and the other documents to which we refer for a more complete understanding of our
             business and this offering. Please read the section entitled “Risk Factors” commencing on page S-18 of this prospectus
             supplement and additional information contained in our Annual Report on Form 10-K for the year ended December 31,
             2010 incorporated by reference in this prospectus supplement for more information about important factors you should
             consider before investing in our common stock in this offering.

                 Our reserve estimates as of December 31, 2010 and 2009 are based on evaluations prepared by our internal reserve
             engineers, which have been audited by Netherland, Sewell & Associates, Inc. Our reserve estimates as of December 31,
             2008 were prepared by Netherland, Sewell & Associates, Inc.

                 We have provided definitions for some of the oil and gas industry terms used in this prospectus supplement in the
             Glossary beginning on page G-1.


                                                                     Our Company

                  We are an independent oil and gas company engaged in the production, exp loration, develop ment a nd acquisition of
             crude oil and natural gas in the U.S. and the North Sea. Our strategy is to expand and explo it our balanced portfolio of
             exploration and development assets using conventional and unconventional technologies in basins that have historically
             generated and produced substantial quantities of oil and gas and that we believe will yield co mmercial quantities of reserves
             through improved drilling and comp letion technologies. Finding, developing and producing oil and gas reserves in the North
             Sea require both significant capital and time. Recognizing this, we have sought to balance our North Sea assets, which have
             large potential reserves but long production-cycles, with a portfolio of assets in the U.S. that have lower costs and shorter
             production-cycles. We also seek to achieve a balance of oil and gas reserves in our portfolio o f assets, believing that both
             commodit ies present attractive opportunities for capital returns in the future.

                   Our North Sea activ ities and assets remain a key source of value that we are actively developing to increase our overall
             reserves and production. Our major development projects in the U.K. sector of the North Sea — Bacchus, Greater Rochelle,
             and Colu mbus — have the potential to significantly expand our total proved reserves and production levels. These projects
             are in various stages of development, with Bacchus currently expected to commence oil production in the second half of
             2011. Additionally, we expect that production from our t wo -phase development of the Greater Rochelle area will commence
             with first production from East Rochelle in the second half of 2012 and fro m West Rochelle shortly thereafter. Finally,
             Colu mbus could commence production as early as 2012. We intend to continue to actively manage our North S ea assets in a
             manner that maximizes value and enables us to allocate resources to effectively pursue our growth strategy.

                  Currently, our primary focus in the U.S. is unconventional gas shale developments targeting reserve and pro duction
             growth in the Haynesville area, including the East Texas Cotton Valley gas sands, and the Marcellus area. In the Haynesville
             area, we have approximately 7,500 net acres with acreage located in Red River, DeSoto, Bienville and Caddo Parishes in
             Louisiana and in Harrison and Gregg Counties in Texas. Our Marcellus acreage is co mprised of appro ximately 18,600 net
             acres in Pennsylvania located between two of the most active parts of the Marcellus play. We also have exploratory plans in
             emerging gas and oil plays in Alabama and Montana where early well results will determine the pace and scope of our
             subsequent exp loration and development in itiatives.

                  In 2011, we intend to expand upon our foundation of producing assets and undeveloped acreage in both est ablished and
             emerging U.S. onshore resource plays, including the development of our leasehold positions in the Haynesville and
             Marcellus areas, wh ile continuing to develop our existing assets in the North Sea. Specifically, during 2011 we intend to
             focus on achieving init ial production fro m the Bacchus oil field in the North Sea.


                                                                       S-1
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                  As of December 31, 2010, our estimated proved reserves were 18.4 MM BOE, up 1.1% fro m 18.2 MMBOE as of
             December 31, 2009, o f which appro ximately 70% were located in the U.K. and approximately 30% were located in the U.S.,
             and 19.4% of wh ich were proved developed reserves. Our 1.7 MM BOE of net reserve additions before production in 2010
             replaced 111% of our production during the year. We also achieved average sales volume of 4,115 BOE/d for the year ended
             December 31, 2010, a 9.5% increase fro m 2009, imp lying a reserve life index of appro ximately 12.2 years based on our
             reserves as of December 31, 2010.


                                                                                   Operations

                  Our operations are organized into two main geographic regions as follow: the North Sea and the U.S. The following
             tables set forth informat ion related to our principal operating areas as of the dates and for the periods indicated.


               North Sea


                                                                                                                       Year Ended
                                                                   As of December 31, 2010                          December 31, 2010
                                                             Estimated Proved
                                                                  Reserves              Average                        Average Daily
                                                              Total                     Working                         Production             Anticipated First
             Ope rating                                      (MMBO          %
             Are a                                              E)          Oil        Interest(1)                        (BO E/d)                 Production


                                                                                                                                                         2nd half
             Bacchus                                               0.2         95 %                  10 %(1)                          —                    2011
                                                                                                                                                         2nd half
             Greater Rochelle                                      9.4         17 %                  53 %                            —                     2012 (2)
             Colu mbus                                             1.8         20 %                  25 %                            —                     2012
             Other fields                                          1.6         96 %                  26 %                         2,895                     N/A

             Total                                               13.0          28 %                  28 %                         2,895


              (1) In February 2011, we increased our working interest to 30%. Please read “— Recent Developments — Bacchus Acquisition.”

              (2) We expect that first production from the East Rochelle field will occur in the second half of 2012, and first production from the West Rochelle field
                  is expected shortly thereafter.


               U.S.


                                                                                                                                          Year Ended De cembe r 31,
                                                                     As of December 31, 2010                                                       2010
                                                    Estimated Proved Reserves                                                                  Average Daily
                                                  Total                  % Proved                 Acreage                                       Production
             Ope rating                         (MMBO E         %
             Are a                                  )          Oil       Developed          Gross                        Net                       (BO E/d)


             Haynesville                               5.0           1%               41 %           18,000                7,500                                1,142
             Marcellus                                 0.3          —                 48 %           39,400               18,600                                   50
             Other                                     0.1          16 %             100 %          529,800              144,500                                   28

             Total                                     5.4           1%                42 %         587,300              170,600                                1,220

                  In the Haynesville and Marcellus areas, we had an average working interest in our properties of 41% and 47%,
             respectively, as of December 31, 2010. In addition to these two primary operating areas, we hold additional interests in
             emerging plays in Alabama and Montana. Please read “— Our A reas of Operation — U.S. — A labama” and “— Central
             Montana.”
                                                    Our Business Strategy

      We pursue a strategy of exploit ing a balanced portfolio o f exp loration and development assets that has evolved over the
last several years. When we commenced operations in 2004, our focus was exclusively in the North Sea. By 2009, we had
built a portfolio of production and development assets in the U.K. and Norway sectors of the North Sea. In May 2009, we
sold our assets and operations in the Norweg ian sector of the


                                                           S-2
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             North Sea fo r $150 million, and we used the proceeds fro m that sale to comp lete acquisitions of U.S. onshore interests,
             providing us with acreage positions and production in the Haynesville and Marcellus areas and our two emerging plays in
             Alabama and Montana. We believe the resource-rich p lays in the U.S., with lower costs and shorter production-cycles, help
             provide a stable platform upon which to execute our strategy. We intend to continue developing our existing assets in the
             North Sea, while simu ltaneously pursuing the development of our do mestic positions in the Haynesville and Marcellus areas
             and our positions in the emerg ing Alabama and Montana plays.

                  We believe this strategy will best enable us to provide an attractive return on capital for our stockholders. Several of the
             key elements of our business strategy include:

                    • Efficiently Develop and Commence Production from our North Sea Development Assets. We currently have three
                      large develop ment projects in the North Sea — the Bacchus, Greater Rochelle and Colu mbus fields — wh ich have
                      the potential to significantly increase our current production levels over the next several years. We intend to
                      efficiently manage our interests in each of these prospects in order to commence production in a t imely and
                      cost-effective manner. We expect to achieve first production from the Bacchus field in the second half of 2011. We
                      expect that production fro m our two-phase development of the Greater Rochelle area will co mmence with first
                      production from East Rochelle in the second half of 2012 and fro m West Rochelle shortly thereafter. Finally,
                      Colu mbus is expected to commence production as early as 2012.

                    • Develop and Exploit Existing Acreage in Resource-Rich Plays . We have established a mix of U.S. producing assets
                      and undeveloped acreage in both established and emerging resource plays, including the Haynesville and Marcellus
                      areas and our emerging p lays in Alabama and Montana. We have the ability to adjust our domestic drilling activ ities
                      in accordance with current and future commodity prices and our operating results.

                    • Maintain a Balanced Portfolio of Production, Development and Exploration Assets . We intend to actively manage
                      our assets in a manner that maximizes value and enables us to allocate resources to effectively pursue our balanced
                      growth strategy. Recognizing this, we have established a portfolio that balances assets that are characterized by
                      shorter production-cycles with assets that have larger potential reserves with longer production -cycles.

                    • Exploit Potential Growth Opportunities in our Emerging Domestic Plays . We have approximately 73,000 and
                      61,000 net acres, respectively, in exp loratory plays in central Montana and western Alabama, which give us
                      exposure to emerging oil and natural gas shale plays, respectively. We believe that the relatively modest capital
                      investment required to drill pilot wells in each of these two areas helps to mit igate the inherent risk in attempting to
                      develop assets in emerg ing plays. We may seek to exp lore these emerging plays following a rev iew of the projected
                      return on capital fro m these plays based on early well results.

                    • Reduce Leverage and Simplify our Capital Structure. To fund our growth over the last several years, we relied
                      primarily on financing structures available to small and developing companies, some o f wh ich were considered
                      relatively co mplicated. These financial instru ments include several series of convertible notes and our senior term
                      loan. We are currently exp loring our options to replace these instruments with more t raditional financing
                      arrangements. In addition, we expect that our application of the net proceeds of this offering will reduce our debt as
                      a percentage of total capitalization fro m 63% as of December 31, 2010 to % on a pro forma basis as of
                      December 31, 2010. We p lan to continue strengthening our balance sheet and lowering our ov erall cost of capital,
                      which we believe will give us access to a wider variety of mo re favorable financing options on a long -term basis.


                                                                          S-3
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                                                               Our Competiti ve Strengths

                    We believe the following co mpetitive strengths will help us achieve our business strategy:

                    • Significant North Sea Development Assets and Attractive Positions in Resource -Rich Shale Plays . We believe that
                      successful development of our three primary development assets in the North Sea could have the potential to
                      significantly increase our production levels over the next several years. Moreover, our assets in the U.S. cover a
                      broad spectrum of resource plays, fro m established areas, such as Haynesville and Marcellus, to emerging plays, in
                      Alabama and Montana. This comb ination should allo w us to balance the capital intensive, long lead -t ime nature of
                      our North Sea assets with the shorter development times and lower cap ital requirements of our U.S. properties.

                    • Balanced Producing and Development and Exploration Assets . We have taken important steps to balance our asset
                      portfolio in several dimensions: U.S. versus U.K. p roperties; oil versus natural gas; and short-term versus long-term
                      realizations. We have constructed our asset portfolio in th is manner in an attempt to mit igate the risks of
                      over-emphasizing any one of these variables. Specifically, we believ e that the resource-rich plays in the U.S., with
                      less capital-intensive and shorter production-cycles relative to our North Sea develop ment projects, will provide a
                      stable platform for the successful execution of our strategy by helping to provide cash flo ws fro m operations as we
                      develop our longer-term, mo re capital-intensive North Sea development projects.

                    • Improving Exposure to Liquids. With the expected first production from our Bacchus asset in the second half of
                      2011, we expect that our liquids production will increase significantly. In addition, our current portfolio of assets
                      includes other liquids-rich opportunities in the North Sea as well as upside development acreage in the Heath oil
                      shale play in Montana. These assets and prospects should provide us with both near- and long-term liquids
                      exposure.

                    • Experienced and Skilled Management Team with Proven Track Records . We were co-founded in 2004 by William
                      L. Transier, our President and Chief Executive Officer, and John N. Seit z, one of our d irectors. Our management
                      team has extensive technical expert ise and industry experience across the full cycle o f development of oil and gas
                      assets and operations. The members of our management team, including our senior geoscience and engineering
                      professionals, average more than 27 years of experience in the oil and gas industry. Under this management team,
                      we have executed several significant transactions, including the sale of our Norwegian subsidiary, the sale of our
                      Cygnus reserves in the North Sea, our recent Bacchus acquisition and several acquisitions of U.S. onshore
                      properties. Substantially all of the members of the team have previously worked for a major o il co mpany or a large
                      independent producer.

                      • Our President and Chief Executive Officer, W illiam L. Transier, was the former Chief Financial Officer of Ocean
                        Energy, which merged with Devon Energy in 2003, and has over 35 years of experience in the oil and gas
                        industry.

                      • Our Chief Financial Officer, J. M ichael Kirksey, has an extensive background in both operational and financial
                        management in the energy industry, having served in various executive roles for Metals USA, Input Output, Inc.
                        and Keystone International, Inc.

                      • Carl D. Grenz, our Executive Vice President — International, has 36 years of experience in the oil and gas
                        industry, having spent a majority of his career working for BHP Billiton and Hamilton Oil, focused in the North
                        Sea.

                      • Our Executive Vice President — North America, James J. Emme, has 30 years of experience in the oil and gas
                        industry, with an extensive background in unconventional hydrocarbon explo ration and development while
                        working for Anadarko Petroleu m Corporation and Source Exp loration, LLC.


                                                                         S-4
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                                                                Our Areas of Operation


             North Sea

                  The North Sea is a proven resource area where we have several significant development projects, producing properties
             and additional explorat ion licenses. Although production costs are higher than conventional developments in the U.S., the
             quality of the oil, the political stability of the region, and the pro ximity of impo rtant markets with strong demand in Western
             Europe has made the No rth Sea an important oil and natural gas producing region. We believe our assets in the U.K. sector
             of the North Sea possess significant value that can continue to be realized in a manner that will provide us with an attractive
             return on invested capital.

                   Our develop ment assets in the Bacchus, Greater Rochelle, and Colu mbus fields comprise the primary co mponents of
             our U.K. North Sea portfo lio, and we currently have development plans under way in each of these fields. When these
             projects are fully producing, they have the potential to significantly increase our current production levels over the next
             several years. We also have producing properties — the Alba, Bittern, Enoch and Go ldeneye fields — and certain other
             fields where we have suspended production. We anticipate re-developing production from our suspended fields, if
             commercially attractive and practicable, once additional production commences fro m the nearby East Rochelle field.

                  We believe that constraints on available cap ital and consolidation have reduced the number of co mpanies operating in
             the North Sea, which in turn has reduced competition and given us an incre ased ability to pursue opportunities consistent
             with our balanced strategy.


             Primary Develop ment Fields

                  Bacchus. At December 31, 2010, we held a 10% working interest in our Bacchus field asset, which is operated by
             Apache Corporation, who owns a 50% working interest. On February 23, 2011, we closed on our previously-announced
             acquisition of an additional 20% working interest in the Bacchus field, bringing our total interest to 30%. Please read
             “— Recent Develop ments — Bacchus Acquisition.” As of December 31, 2010, our 0.2 MMBOE of estimated proved
             reserves in the Bacchus area were 95% o il.

                  The development of the Bacchus field was sanctioned in the second quarter of 2010 by the Depart ment of Energy and
             Climate Change (“DECC”). The discovery well was drilled in 2005, followed by a down-d ip sidetrack appraisal well that
             tested the upper part of the reservoir. The field development plan (“FDP”) for the Bacchus field calls for a subsea
             development with three wells to be drilled and linked to production facilities at the nearby Forties field. The 6.5 kilo meter
             subsea bundled pipeline launched fro m W ick on the east coast of Scotland in early March 2011, and first production is
             expected to commence in the second half of 2011. We believe that the Bacchus field may p roduce up to 4,000 to
             5,000 BOE/d when fu lly on production.

                  Greater Rochelle. The Greater Rochelle area is comp rised of three blocks in the North Sea, including our interests in
             blocks 15/27 and 15/26c. We refer to these blocks as our East Rochelle field and our West Rochelle field, respectively. In
             the East Rochelle field in b lock 15/ 27, we hold a 55.6% working interest and are the operator, wh ile our partner Nexen
             Petroleu m U.K. Limited (“Nexen”) holds the remain ing working interest. In the West Rochelle field in block 15/ 26c, we
             hold a 50% working interest and are the operator. Nexen and Premier Oil p lc (“Premier”) have each farmed into
             block 15/ 26c for a 25% working interest. In the third block of the Greater Rochelle area, block 15/ 26b, Nexen and Premier
             are partners, each with a 50% working interest.

                          East Rochelle. Our reserves at the East Rochelle field are a gas/condensate mix and account for 7.5 MM BOE of
                    our proved reserves at December 31, 2010. In February 2011, we received approval of the FDP for the East Rochelle
                    field by the DECC. The approval o f East Rochelle represents phase one of the development of the Greater Rochelle
                    area. The current East Rochelle FDP calls for the subsea development to be lin ked, by a 30 kilo meter pipeline, to
                    production facilities on the Scott Platform. First production is planned for the second half of 2012.

                        West Rochelle. Nexen operated the first well in b lock 15/ 26b, wh ich was drilled in September 2010 and
                    encountered natural gas with an oil rim in a res ervoir similar to that discovered at East Rochelle. The


                                                                        S-5
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                    well was sidetracked to the north and encountered hydrocarbons that extend the Greater Rochelle area. Th is well
                    confirmed the reserves on our interest in block 15/ 26c.

                   Columbus. We hold a 25% working interest in the Colu mbus field, which is operated by Serica Energy plc. Colu mbus
             is a gas/condensate field in the Central Graben reg ion of the North Sea. Du ring 2010, we, along with our partners in
             Colu mbus, agreed to study an option of producing the field using a new bridge -linked p latform connected to the Lomand
             Platform. We expect to file an updated FDP later in 2011 with project sanction by the DECC anticipated later in the year.
             We believe that first production from this field could occur as early as 2012.


             Producing Fields

                  Our four producing fields in the U.K. — A lba, Bittern, Enoch and Go ldeneye — held a co mbined 1.6 MM BOE of
             proved reserves as of December 31, 2010. Sales fro m these fields totaled 1,057 M BOE for the year ended December 31,
             2010. In addition, we hold interes ts in the Ivanhoe, Rob Roy, Hamish (collectively, “IVRRH”), Renee and Rubie fields, each
             of which is currently shut in.

                   In 2010, the Goldeneye field represented nearly all o f our gas production in the U.K. The field was shut -in in early
             December 2010 due to flow assurance issues resulting fro m increased water production. The Goldeneye field is a mature gas
             field, nearing the end of its production life. When we acquired the Go ldeneye field in October 2006, it contained estimated
             proved reserves of approximately 2,237 MBOE. Fro m our acquisition through December 31, 2010, the Go ldeneye field has
             produced approximately 4,571 MBOE.

                  In February 2011, production fro m the Goldeneye field was re-started to commence flow trials to study pipeline
             hydraulic performance. These trials are continuing and we are mon itoring progress along with the field operator. The trials,
             when concluded, should help us determine how much mo re production may be expected fro m the Go ldeneye field. In
             addition, the operator is evaluating options to use the Goldeneye reservoir as a carbon-capture facility, which may reduce our
             abandonment obligations for the field.

                 Production fro m each of our IVRRH, Renee and Rubie fields is currently suspended. Previously, each of these fields
             produced to a single floating production facility that experienced significant increases in operating costs. As a result,
             production was suspended in the first quarter of 2009 and will remain suspended until the development activit ies at East
             Rochelle are operational, which we currently anticipate to be during 2012. After the start of East Rochelle production, we
             expect to re-develop these fields if co mmercially attractive and practicable.


             U.S.

                  During 2009, we began acquiring acreage in U.S. onshore resource plays. Our U.S. assets held 5.4 MM BOE of proved
             reserves as of December 31, 2010. We believe that our U.S. acreage provides us with development projects with shorter
             timeframes to first production at lower costs than our North Sea assets. In addition, our U.S. acreage covers a broad
             spectrum of resource plays, fro m established areas such as Haynesville and Marcellus areas, to emerging plays in Alabama
             and Montana.

                  Our strategy for our U.S. operations has been to employ a measured approach that seeks to balance U.S. natural gas
             prices with drilling costs. We plan to continue this disciplined approach, which includes:

                    • a one to two rig drilling program in Louisiana and East Texas for our interests in the Haynesville area and Cotton
                      Valley trend;

                    • a measured drilling program to delineate our position in the Marcellus area while pipeline infrastructure issues are
                      resolved; and

                    • a thorough analysis of test well results in Alabama and Montana before finalizing any development plans in these
                      exploratory areas.


                                                                         S-6
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                  We believe this approach in the U.S. should provide flexib ility to adjust our drilling activity in accordance with current
             and future commodity prices and our operating results, while still allowing our U.S. operations to grow and provide
             near-term return on capital to balance our longer production-cycle U.K. pro jects.


             Haynesville Area

                  The Haynesville area has become one of the most active natural gas plays in the U.S. Th is area is defined by a Jurassic
             shale formation located appro ximately 1,000 to 1,500 feet below the base of the Cotton Valley formation at depths ranging
             fro m appro ximately 10,500 feet to 13,000 feet. The format ion is 125 to 250 feet thick and is composed of organic-rich, black
             shale. It is located across numerous parishes in Northwest Louisiana, primarily in Caddo, Bossier, Red River, DeSoto,
             Webster and Bienville parishes, and also in East Texas. Nu merous shallower secondary objectives exist in the Hay nesville
             area, including the overlying Jurassic Cotton Valley Sandstone and Bossier Shale intervals.

                   Through several transactions, we have acquired non-operated interests in both producing wells and prospective acreage
             in the Haynesville area. In October 2009, we purchased interests in 24 wells and certain proved undeveloped locations in
             North Louisiana and East Texas for $15 million in cash. These 24 wells produce primarily fro m the Cotton Valley trend. In
             2010, we acquired additional acreage in the Haynesville and Marcellus areas for a co mbined $22.5 million.

                   In the Haynesville area, we have had drilling activity in the Woodardville, Jamestown, Bu ll Bayou, Metcalf and Grand
             Cane fields in Louisiana, and the Willow Springs field in East Texas. During 20 10, we drilled 12 Haynesville Shale wells,
             all of which were successful.


             Marcellus Area

                   The Marcellus area is a Middle Devonian-aged shale that underlies much of Pennsylvania, New York, Oh io, West
             Virgin ia and adjacent states. Within the past few years , advances in two technologies, fracture stimulation and horizontal
             drilling, have produced promising results in the Marcellus area. These developments have resulted in significantly increased
             leasing and drilling activity in the area. We have acquired interests in the Marcellus area in several project areas, including
             portions of Cameron, Elk, Potter, McKean, Jefferson, Clarion and Clearfield counties, Pennsylvania.

                  During 2010, we successfully co mpleted one well, which is now on production, and commence d drilling the first of two
             planned horizontal tests to further evaluate the Daniel Field in Cameron County. The first horizontal test well was
             successfully drilled and is waiting on co mpletion. We are currently drilling the second test well and may drill addit ional
             wells to delineate the area. In parallel, we are wo rking on expanding pipeline infrastructure, including options to connect
             with one of three major pipelines in Cameron County.


             Alabama

                  We hold non-operating interests in approximately 61,000 net acres with exposure to emerg ing gas shale plays in
             western Alabama. We believe that our position allo ws us to target multiple gas shale intervals, with a p rimary focus on the
             Devonian shale. We drilled t wo vertical pilot wells during 2010 and are evalu ating the results of these wells fo r future
             horizontal re-entries and/or completion tests before formu lating an appropriate co mpletion and development plan.


             Central Montana

                  We own non-operating interests in approximately 73,000 net acres in central Montana, with exposure to the
             Mississippian Heath oil-p rone source shale. This region has historically produced a significant amount of oil fro m the
             Cretaceous through the Mississippian reservoirs. We currently plan to participate in t he drilling of three vert ical pilot wells
             during 2011. We intend to monitor the results of these wells before determining fu rther appraisal or development plans.


                                                                         S-7
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                                                                  2011 Capital Budget

                  We anticipate spending approximately $150 million during 2011 to fund our oil and gas activities in the U.S. and U.K.,
             with appro ximately 60% of those expenditures anticipated to be focused on our U.K. assets. In the U.K., our activity during
             2011 will be primarily concentrated on the Bacchus and Greater Rochelle develop ment projects. At the Bacchus project, we
             plan to drill three production wells and install the infrastructure to allow first production in the second half of 2011. At the
             Greater Rochelle pro ject, our focus will be co mplet ing engineering and procuring long lead -t ime equip ment to prepare
             Greater Rochelle for a 2012 first production date fro m the East Rochelle area. We also intend to begin actual construction of
             the subsea infrastructure and modifications to the Scott platform to prepare it for production fro m the Greater Rochelle area .
             Additionally, we expect to continue to further our development program at our Co lu mbus project, including ongoing
             engineering assessments for future production and commercial off-take solutions.

                  Our primary focus during 2011 in the U.S. will be in the Haynesville and Marcellus areas as we believe this acreage
             contains near-term production potential. The ongoing U.S. program and expenditures will be tailored based on early drilling
             results and U.S. gas prices in 2011. During 2011, we expect to further evaluate our two existing frontier p lays in Alabama
             and Montana through the drilling of additional test wells.

                  We intend to fund our capital expenditures through cash on hand and cash flow generated fro m operations. The
             majority of our cash on hand was acquired through our capital raising activ ities in 2010, including our 15.0% senior term
             loan due 2013 (the “Sen ior Term Loan”) and the sale of our Cygnus reserves. The timing, co mp letion and progress of our
             2011 capital program is subject to a number of factors, including availability of capital, drilling resu lts, drilling and
             production costs, availability of drilling services and equipment, partner approvals and technical work. Based on these and
             other factors, we may increase or decrease our planned capital program or prioritize certain projects over others.


                                                                  Recent Developments


             Rochelle Field Development Plan Approval

                  On February 28, 2011, the DECC approved the Rochelle FDP for Block 15/27 in East Rochelle. Th is approval
             represents phase one of the development of the Greater Rochelle area.


             Bacchus Acquisition

                   On February 23, 2011, we closed our acquisition of an additional 20% working interest in the Bacchus development for
             approximately $9.2 million in cash payable at closing and approximately $6.2 million in cash payable at the earlier o f three
             months after first production or the last business day of 2011. In addition, we paid capital costs previously incurred by the
             seller of $9.4 million. Following the acquisition, we ho ld an aggregate working interest of 30%. First production is expec ted
             fro m the Bacchus field in the second half of 2011. Please read “— Our Co mpany.”


             Amendment of 11.5% Convertible Bonds due 2014

                  On March 11, 2011, we entered into an amend ment (the “Amend ment”) to the Trust Deed dated as of January 24, 2008
             with Smedvig QIF PLC and the other parties thereto related to our 11.5% convertible bonds due 2014 (the “2014
             Convertible Bonds”). The A mendment provides for:

                    • the amend ment of the maturity date of the 2014 Convertib le Bonds from January 24, 2014 to January 24, 2016;

                    • the amend ment of the date upon which the holders of the 2014 Convertible Bonds may first exercise a put right, and
                      the occurrence of the conversion price reset if such put right is not exercised, fro m January 24, 2012 to January 24,
                      2016; and

                    • on and after March 31, 2014, a reduction in the interest rate payable on the 2014 Convertible Bonds fro m 11.5% to
                      7.5%.


                                                                         S-8
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                  Following the Amendment and the application of the net proceeds from this offering to repurchase or redeem all
             $81.25 million of our 6.00% convertible senior notes due 2012 (the “2012 Convertible Notes ”), our Senior Term Loan will
             mature on August 16, 2013. Previously, our Senior Term Loan could have become due and payable in full on October 14,
             2011.


             New York Stock Exchange Listing

                  On March 15, 2011, we consummated the transfer of the primary listing for our common stock fro m the NYSE A mex
             to the New Yo rk Stock Exchange under the symbol “END.”


                                                              Corporate Informati on

                  We are a Nevada corporation formed in 2000. Our principal executive offices are located at 10 01 Fannin Street,
             Suite 1600, Houston, Texas 77002. Our co mmon stock is listed on the New Yo rk Stock Exchange under the symbol “END.”
             We maintain a web site at http://www.endeavourcorp.com . However, the info rmation on, or accessible through, our website
             is not part of this prospectus supplement, and you should rely only on the info rmation contained in this prospectus
             supplement and in the documents incorporated herein by reference when making a decision as to whether to buy our
             common stock in this offering.


                                                                     S-9
Table of Contents

                                                                     THE OFFERING

             Issuer                                           Endeavour International Corporation.

             Shares of common stock offered                   8,000,000 shares.

             Option to purchase additional shares             The underwriters may also purchase up to an additional 1,200,000 shares
                                                              fro m us, at the public offering price, less the underwriting discount, within
                                                              30 days from the date of this prospectus supplement to cover over-allot ments,
                                                              if any.

             Shares of common stock outstanding               33,126,858 shares (34,326,858 shares if the underwriters exercise their
             following this offering 1                        over-allot ment option in fu ll).

             Use of proceeds                                  We intend to use the estimated net proceeds fro m this offering of
                                                              approximately $       million (or $     million if the underwriters exercise their
                                                              over-allot ment option in fu ll) to repurchase or redeem all $81.25 million of
                                                              our 2012 Convertible Notes. The remaining net proceeds will be used for
                                                              general corporate purposes. For more informat ion about our use of proceeds
                                                              fro m this offering, please read “Use of Proceeds.”

             NYSE symbol                                      END.

             Risk Factors                                     Investing in our common stock involves substantial risks. You should
                                                              carefully consider the risk factors set forth in the section entitled “Risk
                                                              Factors” and the other information contained in this prospectus supplement
                                                              and the accompanying prospectus and the documents incorporated by
                                                              reference herein, prior to making an investment in our co mmon stock. Please
                                                              read “Risk Factors” beginning on page S-18.




              (1) Based on 25,126,858 shares outstanding as of March 11, 2011.

                    Unless we indicate otherwise or the context otherwise requires, all o f the information in this prospectus supplement:

                    • assumes no exercise of the underwriters ’ over-allot ment option; and

                    • does not reflect as of December 31, 2010: (i) 464,096 shares of our common stock that may be issued pursuant to
                      the exercise of outstanding stock options held by our directors, officers and emp loyees, (ii) 1,476,894 shares
                      available for issuance under our long-term incentive plans or (iii) 12,858 shares that may be issued upon the
                      exercise of outstanding warrants.


                                                                         S-10
Table of Contents

                                                   Summary Consoli dated Historical Financial Data

                   Set forth below is our summary consolidated historical financial data for the periods indicated. The historical financial
             data for the fiscal years ended December 31, 2008, 2009 and 2010 and the balance sheet data at December 31, 2009 and
             2010 have been derived fro m our audited financial statements that are incorporated by reference in this prospectus
             supplement. The share and per share informat ion presented below has been restated to reflect our November 201 0 reverse
             stock split. Please read “Price Range of Co mmon Stock.” In addition, we co mpleted the divestiture of our No rwegian
             subsidiary on May 14, 2009, and the historical financial informat ion below has been restated to reflect the classificat ion of
             the results of operations and financial position of that subsidiary as discontinued operations for all periods presented. You
             should read the follo wing summary financial data in conjunction with “Management’s Discussion and Analysis of Financial
             Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2010, which is
             incorporated by reference herein.


                                                                                                          Year Ended December 31,
                                                                                                 2008                2009                2010
                                                                                                (Dollars in thousands, except per share data)


             Revenues                                                                       $ 170,781           $     62,293        $    71,675
             Cost of Operations:
               Operating expenses                                                                 32,317              17,776             15,347
               Depreciat ion, depletion and amo rtization                                         67,326              34,020             28,894
               Impairment of oil and gas properties                                               36,970              43,929              7,692
               General and administrative                                                         15,932              16,966             18,415

               Total Expenses                                                                    152,545            112,691              70,348

             Income (Loss) fro m Operations                                                       18,236             (50,398 )            1,327

             Other Inco me (Expense):
               Derivatives:
                  Realized gains (losses)                                                        (28,578 )            35,422            (11,753 )
                  Unrealized gains (losses)                                                       76,666             (55,598 )           12,291
               Interest expense                                                                  (22,975 )           (16,630 )          (34,592 )
               Gain on sale of reserves in place                                                      —                   —              87,171
               Interest income and other                                                           6,626              (7,483 )            1,299

             Total Other Income (Expense)                                                         31,739             (44,289 )           54,416

             Income (Loss) Before Income Taxes                                                    49,975             (94,687 )           55,743
             Income Tax Expense (Benefit)                                                         24,116              (7,158 )             (788 )
             Income (Loss) fro m Continuing Operations                                            25,859             (87,529 )           56,531

             Discontinued Operations, net of tax:
               Income (loss) fro m operations                                                     30,631                (774 )                  —
               Gain on sale                                                                           —               47,308                    —

             Income (Loss) fro m Discontinued Operations                                          30,631              46,534                    —

             Net Inco me (Loss)                                                                   56,490             (40,995 )           56,531
             Preferred Stock Dividends:
               Div idends declared                                                                10,809               9,757              2,227
               Non-cash charge under fair value accounting upon redemption                            —               11,454                 —

                    Total Preferred Stock Dividends                                               10,809              21,211              2,227

             Net Inco me (Loss) to Co mmon Stockholders                                     $     45,681        $    (62,206 )      $    54,304




                                                                       S-11
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                                                                                                         Year Ended December 31,
                                                                                                 2008               2009               2010
                                                                                               (Dollars in thousands, except per share data)


             Basic Net Inco me (Loss) per Co mmon Share:
               Continuing operations                                                           $      0.82       $     (5.84 )       $          2.34
               Discontinued operations                                                                1.67              2.50                      —

               Total                                                                           $      2.49       $     (3.34 )       $          2.34

             Diluted Net Inco me (Loss) per Co mmon Share:
               Continuing operations                                                           $      0.59       $     (4.70 )       $          1.95
               Discontinued operations                                                                1.20              2.50                      —

               Total                                                                           $      1.79       $     (2.20 )       $          1.95

             Weighted Average Number of Co mmon Shares Outstanding:
              Basic                                                                                18,330            18,613               22,252
              Diluted                                                                              25,473            18,613               28,886


                                                                                                                 As of December 31,
                                                                                                             2009                   2010
                                                                                                               (Dollars in thousands)


             Balance Sheet Data:
               Cash, cash equivalents and restricted cash(1)                                            $     30,166             $ 131,043
               Property and equipment, net                                                                   266,587               364,677
               Total assets                                                                                  538,879               750,287
               Long-term debt, including current maturities                                                  223,385               345,306
               Convertible preferred stock                                                                    59,058                53,152
               Stockholders’ equity                                                                           60,133               154,618


              (1) Includes $2.9 million and $31.8 million of restricted cash as of December 31, 2009 and 2010, respectively.

                 The following table includes the non-GAAP financial measures Discretionary Cash Flow, Net Inco me as Adjusted and
             Adjusted EBITDA. Fo r a definit ion of these measures and reconciliations to their most directly co mparable financial
             measures calculated and presented in accordance with generally accepted accounting principles (“GAAP”), please read
             “— Non-GAAP Financial Measures and Reconciliations.”


                                                                                                   Year Ended December 31,
                                                                                        2008                   2009                      2010
                                                                                                     (Dollars in thousands)


             Cash flow data:
               Net cash provided by operating activities                            $ 133,180            $     55,711            $    17,019
               Net cash provided by (used in) investing activities                    (64,851 )                31,120                (56,314 )
               Net cash provided by (used in) financing activities                    (46,613 )               (97,700 )              111,275
             Key statistics:
               Discretionary Cash Flow                                              $ 121,066            $    71,359             $    21,121
               Net Inco me as Adjusted(1)                                              16,523                 41,093                  57,352
               Adjusted EBITDA(1)                                                     176,558                 64,616                 124,756


              (1) Includes $87.2 million of gain fro m the sale of our Cygnus asset in 2010.

                                                                      S-12
Table of Contents



                                                      Summary Reserve and Operating Data


             Reserve Data

                  The following table presents summary data with respect to our estimated net proved oil and natural gas reserves as of
             December 31, 2008, 2009 and 2010. The reserve estimates as of December 31, 2009 and 2010 are based on evaluations
             prepared by our internal reserve engineers, which have been audited by Netherland, Sewell & Associates, Inc. The reserve
             estimates as of December 31, 2008 were prepared by Netherland, Sewell & Associates, Inc.

                  These reserve estimates were prepared in accordance with the SEC’s rules regarding oil and natural gas reserve
             reporting. You should refer to “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results
             of Operations” and “Business” in our Annual Report on Form 10-K for the year ended December 31, 2010, wh ich is
             incorporated by reference herein, in evaluating the material presented below.


                                                                                                         As of December 31,
                                                                                                2008            2009            2010


             Net proved reserves:
               United Kingdom:
                  Oil (M Bbls)                                                                   2,131           3,348            3,664
                  Gas (MMcf)                                                                    27,130          78,316           56,177
                  Oil equivalents (MBOE)(1)                                                      6,653          16,401           13,027
               United States:
                  Oil (M Bbls)                                                                      18              18               59
                  Gas (MMcf)                                                                       690          10,784           31,777
                  Oil equivalents (MBOE)(1)                                                        133           1,815            5,355
               Discontinued operations — Norway :
                  Oil (M Bbls)                                                                   1,406               —                  —
                  Gas (MMcf)                                                                     4,977               —                  —
                  Oil equivalents (MBOE)(1)                                                      2,236               —                  —
               Total:
                  Oil (M Bbls)                                                                  3,555          3,366              3,723
                  Gas (MMcf)                                                                   32,797         89,100             87,954
                  Oil equivalents (MBOE)(1)                                                     9,022         18,216             18,382
             Percentage natural gas                                                                61 %           82 %               80 %
             Percentage proved developed                                                         52.8 %         15.9 %             19.4 %
             Present value of future net revenues before inco me taxes (in thousands)(2,3)   $ 64,579       $ 56,726          $ 224,627
             Standardized measure of d iscounted future net cash flows (in thousands)(3,4)   $ 49,662       $ 55,698          $ 111,297


              (1) One Bb l of oil is equal to six Mcfe based on an approximate energy equivalency. This is a physical correlation and
                  does not reflect a value or p rice relationship between the commodities.

              (2) We set forth our definition of the present value of future net revenues before income taxes (“PV-10”) (a non-GAAP
                  financial measure) and a reconciliation of PV-10 to the standardized measure of discounted net cash flows under
                  “— Non-GAAP Financial Measures and Reconciliations.”

              (3) Year-end prices per M mbtu of natural gas used in making the present value determinations as of December 31, 2008,
                  2009 and 2010, respectively, were: (i) fo r the U.K., $8.70, $4.96 and $6.58, and (ii) for the U.S., $5.60, $3.86 and
                  $4.40. Year-end prices per Bbl of o il used in making the present value determination as of December 31, 2008, 2009
                  and 2010, respectively, were: (i) for the U.K., $36.55, $60.40 and $79.37, and (ii) for the U.S., $41.00, $61.08 and
                  $79.81. Year end prices per M mbtu of natural gas and


                                                                      S-13
Table of Contents



                    per Bb l of o il used in making the present value determination for Norway as of December 31, 2008 were $8.70 and
                    $36.55, respectively. The present value determinations do not include estimated future cash inflows fro m our hedging
                    programs.

              (4) The standardized measure of discounted future net cash flows represents the present value of future net revenues after
                  income tax d iscounted at 10% per annu m and has been calculated in accordance with SFAS No. 69, “Disclosures
                  About Oil and Gas Producing Activities.”


             Production and Operating Data

                   The following table presents summary info rmation concerning our production results and operating costs and expenses
             for the years ended December 31, 2008, 2009 and 2010.


                                                                                                          Year Ended December 31,
                                                                                                      2008           2009             2010


             Sales volu me(1):
               Oil and condensate sales (Mbbls):
                  United Kingdom                                                                       1,032            690             545
                  United States                                                                           —               4               6

                    Continuing operations                                                              1,032            694             551
                    Discontinued operations — Norway                                                     726            310              —

                    Total                                                                              1,758          1,004             551

               Gas sales (MMcf):
                 United Kingdom                                                                        6,532          3,743           3,071
                 United States                                                                            —             320           2,636

                    Continuing operations                                                              6,532          4,063           5,707
                    Discontinued operations — Norway                                                   2,322            686              —

                    Total                                                                              8,854          4,749           5,707

               Oil equivalent sales (MBOE):
                 United Kingdom                                                                        2,121          1,314           1,057
                 United States                                                                            —              58             445

                    Continuing operations                                                              2,121          1,372           1,502
                    Discontinued operations — Norway                                                   1,113            425              —

                    Total                                                                              3,234          1,797           1,502

               Total BOE per day                                                                       8,835          4,923           4,115

             Physical production volume (BOE per day)(2):
                 United Kingdom                                                                        5,804          3,669           2,904
                 United States                                                                            —             162           1,221

                    Continuing operations                                                              5,804          3,831           4,125
                    Discontinued operations — Norway                                                   3,033          1,156              —

                    Total                                                                              8,837          4,987           4,125

             Realized prices(3):
               Oil and condensate price ($ per Bb l):
                  Before co mmodity derivatives                                                   $    90.53      $ 52.15           $ 76.39
                  Effect of co mmod ity derivatives                                                   (14.50 )      22.51             (5.61 )
S-14
Table of Contents




                                                                                                            Year Ended December 31,
                                                                                                        2008          2009          2010


                    Realized prices including co mmodity derivatives                                 $ 76.03        $ 74.66        $ 70.78

               Gas price ($ per Mcf):
                 Before co mmodity derivatives                                                       $ 11.44        $    5.77      $   5.18
                 Effect of co mmod ity derivatives                                                     (0.35 )           2.69          0.27

                    Realized prices including co mmodity derivatives                                 $ 11.09        $    8.46      $   5.45

               Equivalent oil price ($ per BOE):
                 Before co mmodity derivatives                                                       $ 80.54        $ 44.44        $ 47.72
                 Effect of co mmod ity derivatives                                                     (8.84 )        19.71          (1.03 )

                    Realized prices including co mmodity derivatives                                 $ 71.70        $ 64.15        $ 46.69

             Operating costs ($ per BOE)(4)                                                          $ 14.40        $ 12.97        $ 10.22




              (1) We record oil revenues on the sales method, i.e. when delivery has occurred. We use the entitlements method to
                  account for sales of gas production.

              (2) Physical production may differ fro m sales volu mes based on the timing of tanker lift ings for our international sales.

              (3) The average sales prices reflect both our continuing and discontinued operations and include realized gains and losses
                  for derivative contracts we utilize to manage price risk related to our future cash flows.

              (4) Operating costs reflect both our continuing and discontinued operations and are costs incurred to operate and maintain
                  our wells and related equip ment and include cost of labor, well service and repair, location maintenance, power and
                  fuel, t ransportation, cost of product and production related general and administrative costs.


                                                 Non-GAAP Fi nancial Measures and Reconciliations


             PV-10

                   PV-10 is derived fro m the standardized measure of discounted future net cash flows, which is the most directly
             comparable GAAP financial measure. PV-10 is a co mputation of the standardized measure of discounted future net cash
             flows on a pre-tax basis. PV-10 is equal to the standardized measure of d iscounted future net cash flows at the applicable
             date, before deducting future income taxes, discounted at 10%. We believe that the presentation of PV-10 is relevant and
             useful to investors because it presents the discounted future net cash flows attributable to our estimated net proved reserves
             prior to taking into account future corporate income taxes, and it is a useful measure for evaluating the relative monetary
             significance of our o il and natural gas properties. Further, investors may utilize the measure as a basis for comparison of the
             relative size and value of our reserves to other companies. PV-10, however, is not a substitute for the standardized measure
             of discounted future net cash flows. Our PV-10 measure and the standardized measure of discounted future net cash flows do
             not purport to present the fair value of our oil and natural gas reserves.

                  Our calculations of PV-10 and standardized measure as of December 31, 2009 and 2010 are based on evaluations
             prepared by our internal reserve engineers, which have been audited by Netherland, Sewell & Associates, Inc. Our
             calculations of PV-10 and standardized measure as of December 31, 2008 are based on

                                                                       S-15
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             evaluations prepared by Netherland, Sewell & Associates, Inc. The following table provides a reconciliat ion of the
             standardized measure of future net cash flows to PV-10 as of December 31, 2008, 2009 and 2010.


                                                                                                           As of December 31,
                                                                                               2008                2009             2010
                                                                                                             (in thousands)


             PV-10                                                                         $    64,579        $ 56,726          $    224,627
             Present value of future inco me tax discounted at 10%                         $   (14,887 )      $ (1,028 )        $   (113,330 )
             Standardized measure of d iscounted future net cash flows                     $    49,662        $ 55,698          $    111,297


             Discretionary Cash Flow, Net Income as Adjusted and Adjusted EBITDA

                  Net inco me can be significantly affected by various non-cash items, such as unrealized gains and losses on our
             commodity derivatives, currency impact of long-term liabilit ies and deferred taxes. Given the significant impact that
             non-cash items may have on our net income, we use various measures in addition to net income and net cash provided by
             operating activities, including non-financial performance indicators and non-GAAP measures as key met rics to manage our
             business. These metrics demonstrate our ability to maintain o r grow production levels and reserves, internally fund capital
             expenditures and service debt as well as provide co mparisons to other oil and gas explorat ion and production companies. Net
             Income (Loss) as Adjusted, adjusted earnings before interest, taxes, depreciation, deplet ion and amort ization, adjusted for
             the early termination of co mmodity derivatives and income (loss) fro m d iscontinued operations (“Adjusted EBITDA”) and
             cash flow fro m operating activit ies before the changes in operating assets and liabilit ies (“Discretionary Cash Flow”) are
             internal, supplemental measures of our performance that are not required by, or presented in accordance with GA AP. The
             calculations of these non-GAAP measures and the reconciliat ion of net inco me (loss) to these non -GAAP measures are
             provided below.

                  We view these non-GAAP measures, and we believe that others in the oil and gas industry, securities analysts,
             investors, and other interested parties view these, or similar, non -GAAP measures, as commonly used analytic indicators to
             compare performance among co mpanies in our industry and in the evaluation of issuers.

                  Because Net Income (Loss) as Adjusted, Adjusted EBITDA and Discretionary Cash Flow are not measures determined
             in accordance with GAAP and thus are susceptible to varying calculations, our no n-GAAP measures as presented may not be
             comparable to similarly tit led measures of other companies. Net Income (Loss) as Adjusted, Adjusted EBITDA and
             Discretionary Cash Flow have limitations as analytical tools, and you should not consider these measures in isolation, or as a
             substitute for analysis of our financial statement data presented in the consolidated financial statements as reported under
             GAAP.


                                                                      S-16
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                  The table below provides a reconciliat ion of each of Net Inco me (Loss) as Adjusted, Adjusted EBITDA and
             Discretionary Cash Flow to net income (loss).


                                                                                                    Year Ended December 31,
                                                                                             2008                2009              2010
                                                                                                      (Dollars in thousands)


             Net inco me (loss)                                                          $    56,490       $    (40,995 )      $    56,531
             Depreciat ion, depletion and amo rtization                                       81,734             38,701             28,894
             Impairment of oil and gas properties                                             36,970             43,929              7,692
             Deferred tax expense (benefit)                                                   17,682              4,599             (3,367 )
             Gain on sales                                                                      (258 )          (47,308 )          (87,171 )
             Unrealized (gain) loss on derivatives                                           (76,666 )           55,598            (12,291 )
             Early termination of co mmodity derivatives                                          —                  —              10,201
             Other                                                                             5,114             16,835             20,632

             Discretionary Cash Fl ow                                                    $ 121,066         $    71,359         $   21,121

             Net inco me (loss)                                                          $    56,490       $    (40,995 )      $   56,531
             Impairment of oil and gas properties (net of tax)(1)                             18,485             28,263             7,692
             Unrealized (gain) loss on derivatives (net of tax)(2)                           (37,743 )           33,702            (6,820 )
             Currency impact on deferred taxes                                               (20,709 )           20,123               (51 )

             Net Income as Adjusted                                                      $    16,523       $    41,093         $   57,352

             Net inco me (loss)                                                          $    56,490       $    (40,995 )      $    56,531
             Unrealized (gain) loss on derivatives                                           (76,666 )           55,598            (12,291 )
             Net interest expense                                                             21,301             16,420             34,517
             Depreciat ion, depletion and amo rtization                                       81,734             38,701             28,894
             Impairment of oil and gas properties                                             36,970             43,929              7,692
             Income tax expense (benefit)                                                     56,729             (1,729 )             (788 )
             Early termination of co mmodity derivatives                                          —                  —              10,201
             Gain on sale of d iscontinued operations                                             —             (47,308 )               —

             Adjusted EB ITDA                                                            $ 176,558         $    64,616         $ 124,756




              (1) Net of tax benefits of $(18,485), $(15,666) and none for 2008, 2009 and 2010, respectively.

              (2) Net of tax expense (benefit) of $38,923, $(21,896) and $5,471 for 2008, 2009 and 2010, respectively.


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                                                                 RIS K FACTORS

               An investment in our common stock involves risks. In addition to the risks described below, you should also carefully
         read all of the other information included in this prospectus supplement, the accompanying prospectus and the documents
         we have incorporated by reference into this prospectus supplement in evaluating an investment in our common stock. If any
         of the described risks actually were to occur, our business, financial condition or results of operations could be affected
         materially and adversely. In that case, the trading price of our common stock could decline and you could lose all or part of
         your investment. The risks described below are not the only ones facing our company. Additional risks not presently known
         to us or that we currently deem immaterial individually or in the aggregate may also impair our business operations.


         Risks Related to Our Business

            We operate internationally and are subject to political, economic and other uncertainties.

              We currently have operations in the U.S. and U.K. and may expand our operations to other countries or regions.
         International operations are subject to political, economic and other uncertainties, including:

               • the risk of war, acts of terroris m, revolution, border disputes, expropriat ion, renegotiation or modificat ion of existing
                 contracts, and import, export and transportation regulations and tariffs;

               • taxat ion policies, includ ing royalty and tax increases and retroactive tax claims;

               • exchange controls, currency fluctuations and other uncertainties arising out of foreign government sovereignty over
                 our international operations;

               • laws and policies of the U.S. affecting foreign trade, taxat ion and investment; and

               • the possibility of being subject to the exclusive jurisdiction of foreign courts in connection with legal d isputes and
                 the possible inability to subject foreign persons to the jurisdiction of courts in the U.S.

               The exploration, p roduction and sale of oil and gas are extensively regulated by governmental bodies, which subjects us
         to increased costs in order to comp ly with applicab le laws and regulations as well as significant uncertainties due to the
         potential fo r such laws and regulations to change and evolve. Applicable legislation and regulations are under constant
         review for amendment or expansion. These efforts frequently result in an increase in the regulatory burden on companies in
         our industry and consequently an increase in the cost of doing busin ess and decrease in profitability. Nu merous
         governmental departments and agencies are authorized to, and have, issued rules and regulations imposing additional
         burdens on the oil and gas industry that often are costly to comply with and carry substantial p enalties for failure to comp ly.
         Production operations are affected by changing tax and other laws relat ing to the petroleum industry, by constantly changing
         administrative regulations and possible interruptions or termination by government authorities.

               Oil and gas mineral rights may be held by individuals, corporations or governments having jurisdiction over the area in
         which such mineral rights are located. As a general rule, parties holding such mineral rights grant licenses or leases to third
         parties to facilitate the explorat ion and development of these mineral rights. The terms of the leases and licenses are
         generally established to require timely development. Notwithstanding the ownership of mineral rights, the government of the
         jurisdiction in wh ich mineral rights are located generally retains authority over the manner of development of those rights.
         As such, we may become subject to certain requirements, obligations and timelines as established or demanded by the holder
         of the oil and gas mineral rights and such requirements or obligations may adversely impact our operations, cash flow and
         capital plans.


            Economic conditions in the U.S. and key international markets may materially adversely impact our operating results,
            which could hinder or prevent us from meeting our future capital needs.

               The U.S., U.K. and other world economies are slowly recovering fro m a recession which began in 2008 and extended
         into 2009. Gro wth has resumed, but remains modest. There are likely to be significant long -term effects resulting fro m the
         recession and credit market crisis, includ ing a future global econo mic g rowth rate
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         that is slower than what was experienced in recent years. In addition, mo re volatility may occur before a sustainable, yet
         lower, growth rate is achieved. Because global economic g rowth drives demand for energy fro m all sources, including fossil
         fuels, a lower future economic growth rate will result in decreased demand growth for our crude oil and natural gas
         production as well as lower co mmodity prices, wh ich will reduce our cash flows fro m operations and our profitability and
         may adversely affect our ability to obtain funding for our pro jects.

              Due to these and other factors, we cannot be certain that funding will be available if needed, and to the extent required,
         on acceptable terms or at all. If funding is not availab le as needed, or is availab le only on unfavorable terms, we may be
         unable to (i) meet our obligations as they come due, (ii) refinance or extend the maturity of our outstanding 6% Senio r
         Convertible Notes which would result in the Senio r Term Loan maturing and becoming due and payable in fu ll on
         October 14, 2011, or (iii) imp lement our capital program, enhance our existing business, complete acquisitions or otherwise
         take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse
         effect on our production, revenues, results of operations and prospects.


            Oil and gas prices are volatile, and a decline in oil and gas prices would reduce our revenues, profitability and cash
            flow and impede our growth.

               Our revenues, profitability and cash flow depend substantially upon the prices and demand for o il and gas. The markets
         for these commodities are volatile, and even relat ively modest drops in prices can significantly affect our financial results
         and impede our growth. Oil and gas prices increased to, and then declined significantly fro m, historical highs in 2008 and
         may fluctuate and decline significantly in the near future. Prices for oil and gas fluctuate in response to relatively minor
         changes in the supply and demand for oil and gas, market uncertainty and a variety of addit ional factors beyond our control,
         such as:

               • global supply of oil and gas;

               • level of consumer product demand;

               • technological advances affecting oil and gas consumption;

               • global economic conditions;

               • price and availability of alternative fuels;

               • actions of the Organization of Petroleu m Export ing Countries and other state-controlled oil co mpanies relat ing to oil
                 price and production controls;

               • governmental regulations and taxat ion;

               • political conditions in or affecting other oil-producing and gas-producing countries;

               • weather conditions;

               • the proximity, capacity, cost and availability of p ipeline and other transportation facilities; and

               • the impact of energy conservation efforts.

               Lower o il and gas prices may not only decrease our revenues on a per unit basis, but significant or extended price
         declines may also reduce the amount of oil and gas that we can produce economically. A reduction in production could result
         in a shortfall in expected cash flows and require us to reduce capital spending or borrow funds to cover any such shortfall.
         Any of these factors could negatively impact our future rate of growth and ability to replace our production.

              In addition, we may, fro m time to time, enter into long-term contracts based upon our reasoned expectations for
         commodity price levels. If co mmodity prices subsequently decrease significantly for a sustained period, we may be unable to
         perform our obligations or otherwise breach the contract and be liable fo r damages.
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            Competition for oil and gas properties and prospects is intense and some of o ur competitors have larger financial,
            technical and personnel resources that give them an advantage in evaluating, obtaining and developing properties and
            prospects.

               We operate in a highly co mpetitive environment for rev iewing prospects, acquiring properties, marketing oil and gas
         and securing trained personnel. Many of our competitors are major o r independent oil and gas companies that have longer
         operating histories in our areas of operation and employ superior financial resources which allow them to obtain
         substantially greater technical and personnel resources and which better enable them to acquire and develop the prospects
         that they have identified. We also actively co mpete with other companies when acquiring new licenses or oil and gas
         properties. Specifically, co mpetitors with greater resources than our own have certain advantages that are particularly
         important in rev iewing prospects and purchasing properties. Co mpetitors may be ab le to evaluate, bid fo r and purchase a
         greater number o f properties and prospects than our financial or personnel resources permit. Co mpetitors may also be able to
         pay more for producing oil and gas properties and exploratory prospects than we are able or willing to pay. If we are unable
         to compete successfully in these areas in the future, our future revenues and growth may be dimin ished or restricted.

               These competitors may also be better able to withstand sustained periods of unsuccessful drill ing or downturns in the
         economy, including decreases in the price of commodities as experienced in 2008 and 2009. Larger competitors may also be
         able to absorb the burden of any changes in laws and regulations more easily than we can, wh ich would also adve rsely affect
         our competitive position. In addition, most of our co mpetitors have been operating for a much longer time and have
         demonstrated the ability to operate through industry cycles.


            Our use o f derivative transactions may limit future revenues from price increases and involves the risk that our
            counterparties may be unable to satisfy their obligations to us.

              To manage our exposure to price or interest rate risk with our production, we routinely enter into commodity derivative
         contracts. The goal of these derivative contracts is to limit volatility and increase the predictability of cash flow. Although
         the use of derivative contracts limits the downside risk of price declines, their use also may limit future revenues fro m price
         increases. In addition, derivative contracts may expose us to the risk of financial loss in certain circu mstances, including
         instances in which our production is less than expected or a sudden, unexpected event materially impacts oil or gas prices.

              Derivative contracts also involve the risk that counterparties, which generally are financial institutions, may be unable
         to satisfy their obligations to us. If any one of our counterparties were to default on its obligations to us under the deriv ative
         contracts or seek bankruptcy protection it could have a material adverse effect on our expected cash flows and our ability to
         fund our planned activities and could result in a larger percentage of our future production being subject to commodity price
         changes. In addition, in the current economic environment and tight financial markets, the risk of a counterparty default is
         heightened and it is possible that fewer counterparties will participate in future derivative transactions, which could result in
         greater concentration of our exposure to any one counterparty or a larger percentage of our future production being subject to
         commodity price changes.


            We are dependent on our executive officers and need to attract and retain additional qualified personnel.

              Our future success depends in large part on the service of our executive officers. The loss of these executives could
         have a material adverse effect on our business. Although we have employ ment agreements with certain of our executive
         officers, there can be no assurance that we will have the ability to retain their services. Further, we do not maintain
         key-person life insurance on any executive officers.

              Our future success also depends upon our ability to attract, assimilate and retain highly qualified tech nical and other
         management personnel who are essential for the identification and development of our prospects. There can be no assurance
         that we will be ab le to attract, integrate and retain key personnel, and our failu re to do so would have a material ad verse
         effect on our business.


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            Our operations are sensitive to currency rate fluctuations.

               Our operations are sensitive to fluctuations in foreign currency exchange rates, particularly between the U.S. dollar and
         the British pound. Our financial statements, presented in U.S. dollars, are affected by foreign currency fluctuations through
         both translation risk and transaction risk. Vo lat ility in exchange rates may adversely affect our results of operation,
         particularly through the weakening of the U.S. dollar relative to other currencies.


         Risks Related to Executing Our Strateg y and Operations

            To maintain and grow our production and cash flow, we must continue to develop and produce existing reserves and
            discover or acquire new oil and gas reserves to develop and produce.

              Our future oil and gas production is highly dependent upon our level of success in finding or acquiring additional
         reserves. Producing oil and gas reserves are generally characterized by declin ing production rates that vary depending on
         reservoir characteristics and other factors. Our reserves will decline unless we acquire properties with proved reserves or
         conduct successful development and exp loration drilling activities. We acco mplish this through successful drilling programs
         and the acquisition of properties. However, we may be unable to find, develop or acquire additional reserves or production at
         an acceptable cost or at all. Acquisition opportunities in the oil and gas industry are very competit ive, which can increase the
         cost of, or cause us to refrain fro m, co mp leting acquisitions.

              If we are unable to find, develop or acquire additional reserves to replace our current and future production, our
         production rates will decline even if we d rill the undeveloped locations that were included in our estimated proved reserves.
         Our future oil and gas reserves and production, and therefore our cash flow and income, are dependent on our success in
         economically finding or acquiring new reserves and efficiently developing our existing reserves.


            We may be unable to make attractive acquisitions, and any acquisition we complete is subject to substantial risks that
            could impact our business.

               As part of our growth strategy, we intend to continue to pursue strategic acquisitions of new properties or businesses
         that expand our current asset base and potentially offer unexplo ited reserve potential. Our growth strategy could be impeded
         if we are unable to acquire addit ional interests in oil and gas prospects on a profitable basis. Acquisition opportunities in the
         oil and gas industry are very competitive, wh ich can increase the cost of, or cause us to refrain fro m, co mp leting
         acquisitions. The success of any acquisition will depend on a number of factors and involves potential risks, including
         among other things:

               • the inability to estimate accurately the costs to develop the interests in oil and gas prospects, the recoverable
                 volumes of reserves, rates of future production and future net cash flows attainable fro m the reserves;

               • the assumption of unknown liabilit ies, losses or costs for which we are not indemn ified or for which the indemnity
                 we receive is inadequate;

               • the validity of assumptions about costs, including synergies;

               • the impact on our liqu idity or financial leverage of using available cash or debt to finance acquisitions;

               • the diversion of management’s attention from other business concerns; and

               • an inability to hire, train or retain qualified personnel to manage and operate our growing business and assets.

              All of these factors affect whether an acquisition will ult imately generate cash flows sufficient to provide a suitable
         return on investment. Consistent with industry practices, we typically are only ab le to perform limited reviews of the
         properties we seek to acquire. As a result, among other risks, our init ial estimates of reserves, and the costs associated with
         developing those estimated reserves, may be subject to revision following an acquisition, wh ich may materially and
         adversely impact the desired benefits of the acquisition.


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            Our expectations for future drilling and development activities will be realized over several years, making them
            susceptible to uncertainties that could materially alter the occurrence or timing of such activities.

               We have identified drilling locations, prospects for future drilling opportunities and development plans for our
         commercial d iscoveries, including development, exploratory and other drilling and enhanced recovery activities. These
         drilling and development locations and prospects represent a sig nificant part of our future drilling and development plans.
         Our ability to drill and develop these locations depends on a number of factors, including the availability of capital, seaso nal
         conditions, third-party operators, regulatory approvals, negotiation of agreements with third part ies, commod ity prices, costs
         and drilling results. In particular, delays in obtaining regulatory approvals relat ing to our field development programs for our
         North Sea discoveries can materially impact our ab ility to co mmence production at these discoveries which would materially
         impact our reserves, cash flow and results of operations. Furthermore, because of these uncertainties, we cannot give any
         assurance as to the timing of these activities or that they will ult imately result in the realizat ion of proved reserves or meet
         our expectations for success. As such, our actual drilling and enhanced recovery activities may materially d iffer fro m our
         current expectations, which could have a significant adverse effect on our financial condition and results of operations.


            Our drilling projects are based in part on seismic and other technical data, which cannot ensure the commercial
            success of a prospect.

              Our decisions to purchase, exp lore, develop and exp loit prospects or properties depend in part on data obtained through
         geophysical and geological analyses, production data and engineering studies, the results of which are often uncertain.
         Seis mic data and visualizat ion techniques only assist geoscientists and geologists in identifying subsurface structures and
         hydrocarbon indicators and do not enable an interpreter to conclusively determine whether hydrocarbons are present or
         producible economically. In addit ion, the use of seismic and other advanced technologies may require g reater predrilling
         expenditures than other drilling strategies. Because of these factors and the inherent uncertainties surrounding the evaluation
         of explo ration prospects, we could incur losses as a result of explo ratory drilling expenditures. Poor results from drilling
         activities would have a material adverse effect on our future cash flows, ability to replace reserves and results of operatio ns.


            Reserve estimates depend on many assumptions that may turn out to be inaccurate and any material inaccuracies in
            the reserve estimates or underlying assumptions of our assets will materially affect the quantities and present value of
            those reserves.

              Estimating o il and gas reserves is comple x and inherently imprecise. It requires interpretation of the availab le technical
         data and making many assumptions about future conditions, including price and other economic factors. In preparing such
         estimates, projection of production rates, timing of development expenditures and available geological, geophysical,
         production and engineering data are analyzed. The extent, quality and reliab ility of these data can vary. This process also
         requires economic assumptions about matters such as oil and gas prices, drilling and operating expenses, capital
         expenditures, taxes and availability of funds. If our interpretations or assumptions used in arriving at our reserve estimate s
         prove to be inaccurate, the amount of oil and gas that will ult imately be recovered may d iffer materially and adversely fro m
         the estimated quantities and net present value of reserves owned by us.


            A significant portion of our total estimated net proved reserves at December 31, 2010 were undeveloped, and those
            reserves may not ultimately be developed.

              At December 31, 2010, appro ximately 81% of our total estimated net proved reserves were undeveloped. Recovery of
         undeveloped reserves requires significant capital expenditures and successful drilling. Our reserve data assumes that we can
         and will make these expenditures and conduct these operations successfully. These assumptions, however, may not prove
         correct. If we choose not to spend the capital to develop these reserves or if we are not otherwise able to successfully
         develop these reserves we may be required to write-off these reserves. Any such write-offs of our reserves could materially
         reduce our ability to borrow money and the value of our securities.


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            Our offshore operations involve special risks that could increase our cost of operations and adversely affect our ability
            to produce oil and gas.

               Offshore operations are subject to a variety of operating risks specific to the marine environ ment, such as capsizing,
         collisions and damage or loss from hurricanes or other adverse weather conditions. These conditions can cause substantial
         damage to facilities and interrupt production. As a result, we could incur substantial liab ilities th at could reduce or eliminate
         the funds available for exp loration, develop ment or leasehold acquisitions, or result in loss of equipment and properties.
         Offshore drilling in the North Sea generally requires mo re time and more advanced drilling technologies, involving a higher
         risk of technological failure and usually higher drilling costs. Moreover, offshore projects often lack pro ximity to the
         physical and oilfield service infrastructure, necessitating significant capital investment in subsea flow line infrastructure.
         Subsea tieback production systems require substantial time and the use of advanced and very sophisticated installation
         equipment supported by remotely operated vehicles. These operations may encounter mechanical difficult ies and equipment
         failures that could result in significant cost overruns. As a result, a significant amount of time and capital must be invested
         before we can market the associated oil or gas, increasing both the financial and operational risk involved with these
         operations. Because of the lack and high cost of infrastructure, some offshore reserve discoveries may never be produced
         economically.


            We have commenced exploration, production and development operations in the United States, and as a result, our
            ability to successfully achieve our goals is subject to greater risk and uncertainty.

               In 2008, we began to pursue explo ration, production and development activities in the U.S. Moreover, we did not have
         a significant U.S. presence in our assets and operations until late 2009. Because we have limited production history in the
         U.S. and do not have extensive experience in unconventional resource plays, we are less able to use past operational results
         to help predict future results. Our lack of operational experience in the U.S. may result in our not being able to fu lly execute
         our expected drilling programs in this region, and the return on investment fro m our Un ited States operations may not be as
         attractive as expected. We cannot assure you that our efforts in the U.S. will be successful, or if successful will achieve the
         resource potential levels that we currently anticipate or ach ieve the anticipated economic returns based on our current
         financial models.


            We are not the operator of our producing fields and will not be the op erator of all of the interests we own or acquire,
            and therefore we may not be in a position to control the timing of development efforts, t he associated costs, or the rate
            of production of the reserves i n respect of such i nterests.

              A significant number of our interests, including all of our producing fields, are currently operated by third parties. As a
         result, we may have limited ability to exercise influence over the operations of these interests or their associated costs.
         Dependence on the operator and other working interest owners for these projects, and limited ability to influence operations
         and associated costs could prevent the realizat ion of expected returns on capital in drilling or acquisition activ ities. The
         success and timing of development and explo itation activities on properties operated by others depend upon a number of
         factors that will be largely outside our control, including:

               • the operator’s expertise and financial resources;

               • the timing and amount of their capital expenditures;

               • the rate of production of the reserves;

               • approval of other participants to drill wells and imp lement other work programs;

               • the availability of suitable drilling rigs, drilling equip ment, support vessels, production and transportation
                 infrastructure and qualified operating personnel; and

               • selection of technology.

             Our inability to control the development efforts, costs and timing on the interests where we are not the operator could
         have a material adverse effect on our financial conditions, results of operations and business prospects.
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            Actual production could differ significantly from forecasts.

              Fro m t ime to time we provide fo recasts of expected quantities of future oil and gas production. These forecasts are
         based on a number of estimates, includ ing expectations of production decline rates fro m existing wells, outcomes fro m
         future drilling activity and assumptions relating to ongoing operations and maintenance of producing wells. Should these
         estimates prove inaccurate, actual production could be adversely impacted. Furthermore, downturns in commodity prices
         could make certain drilling activities or production uneconomical, which would also adversely impact production. We may
         also adjust estimates of proved reserves to reflect production history, results of explo ration and development, prevailing oil
         and gas prices and other factors, many of wh ich are beyond our control.


            Our insurance may not protect us against business and operating risks, including an operator of a prospect in which
            we participate failing to maintain or obtain adequate insurance.

               Oil and gas operations are subject to particular hazards incident to the drilling and production of oil and gas, such as
         blowouts, cratering, exp losions, uncontrollable flows of o il, gas or well fluids, fires and pollution and other environmental
         risks. These hazards can cause personal in jury and loss of life, severe damage to and destruction of property and equipment,
         pollution or environ mental damage and suspension of operations. We maintain insurance for some, but not all, of the
         potential risks and liabilit ies associated with our business. If a significant accident or other event resulting in damage to our
         operations, including severe weather, terrorist acts, war, civil disturbances, pollution or environmental damage, occurs and is
         not fully covered by insurance, it could adversely affect our financial condition and results of operations. We do not
         currently operate all of our o il and gas properties. In the projects in which we own non -operating interests, the operator may
         maintain insurance of various types to cover our operations with policy limits and retention liability customary in the
         industry. The occurrence of a significant adverse event that is not fully covered by insurance could result in the loss of ou r
         total investment in a particu lar prospect and additional liability fo r us, which could have a material adverse effect on our
         financial condition and results of operations and prospects.


            The cost of decommissioning is uncertain.

              We expect to incur obligations to abandon and decommission certain structures associated with our producing
         properties. To date, the industry has little experience of removing oil and gas structures from the North Sea, because few of
         the structures in the North Sea have been removed. Because experience in limited, we ca nnot precisely predict the costs of
         any future decommissions for which we might become obligated. Furthermore, we are required to post collateral as security
         over certain of our deco mmissioning liabilities in the North Sea. If actual decommission or abando nment costs exceed our
         estimates or reserves to satisfy such obligations, or we are required to provide a significant amount of collateral in cash o r
         other security for these future costs, our financial condition, results of operations and prospects could be materially adversely
         affected.


         Risks Related to Access to Capital and Financing

            Our development and exploration operations require substantial capital, and we may be unable to obtain needed
            capital or financing on satisfactory terms, which could lead to a loss of properties and a decline in our oil and gas
            reserves.

              The oil and gas industry is capital intensive. We make and expect to continue to make substantial capital expenditures
         in our business and operations for the explorat ion, development, p roduction and acquisition of oil and gas reserves, including
         expenditures relating to the development of our discoveries in the North Sea and our acreage position in the Haynesville
         Shale and other U.S. p lays. We intend to finance our future capital expenditures primarily with cash flow fro m operations
         and borrowings under our Senior Term Loan. Our cash flo w fro m operations and access to capital is subject to a number of
         variables, including:

               • our oil and gas reserves;

               • the level of natural gas and crude oil we are ab le to produce fro m existing wells;


                                                                       S-24
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               • the prices at which natural gas and crude oil are sold; and

               • our ability to acquire, locate and produce new reserves.

              If our revenues decrease as a result of lower o il and gas prices, operating difficu lties, declines in reserves or for any
         other reason, we may have limited ability to obtain the capital necessary to sustain our operations at current levels or to
         further develop and exp loit our current properties, or for exp loratory activity. In order to fund our capital expenditures, we
         may need to seek additional financing. Our credit agreements contain covenants restricting our ability to incur additional
         indebtedness without the consent of the lenders. Our lenders may withhold this consent in their sole discretion.

               Furthermore, we may not be able to obtain debt or equity financing on terms favorable to us, or at all. In part icular, the
         cost of raising money in the debt and equity capital markets has increased substantially wh ile the availa bility of funds fro m
         those markets generally has diminished significantly. Also, as a result of concerns about the stability of financial markets
         generally and the solvency of counterparties specifically, the cost of obtaining money fro m the credit markets generally has
         increased as many lenders and institutional investors have increased interest rates, enacted tighter lending standards, refus ed
         to refinance existing debt at maturity on terms that are similar to existing debt, and reduced, or in some cases ceased, to
         provide funding to borrowers. The failure to obtain additional financing could result in a curtailment of our operations
         relating to exp loration and development of our prospects, which in turn could lead to a possible loss of properties and a
         decline in our natural gas, crude oil and natural gas liquids reserves.


            Our debt levels could negatively impact our financial condition, results of operations and business prospects.

             As of December 31, 2010, we had $349.6 million in outstanding indebtedness. Our level of indebtedness could have
         important consequences on our operations, including:

               • placing restrictions on certain operating activities;

               • making it mo re difficult for us to satisfy our obligations under our indentures or the terms of our other debt
                 instruments and increasing the risk that we may default on our debt obligations;

               • requiring us to dedicate a substantial portion of our cash flow fro m operating activit ies to required payments on
                 debt, thereby reducing the availability of cash flow for working capital, capital expenditures and other general
                 business activities;

               • limit ing our ability to obtain additional financing in the future for working capital, cap ital expenditures, acquisitions
                 and other general business activities;

               • decreasing our ability to withstand a downturn in our business or the economy generally; and

               • placing us at a competitive d isadvantage against other less leveraged competitors.

              We may not have sufficient funds to repay our outstanding debt. If we are unable to repay our debt out of cash on hand,
         we could attempt to refinance such debt, sell assets or repay such debt with the proceeds from an equity offering. In addit io n,
         we cannot assure you that we will be able to generate sufficient cash flow fro m operating activities to pay the interest on our
         debt or that future borrowings, equity financings or proceeds from the sale of assets will be availab le to repay or refinance
         such debt. Furthermore, some of our existing debt instruments contain certain restrictions on our ability to repay other debt.
         For examp le, our Sen ior Term Loan prohib its cash on hand fro m being used to repay any debt other than that extended
         pursuant to the related Credit Agreement.

              Factors that will affect our ability to raise cash through an offering of our capital stock, a refinancing of our debt or a
         sale of assets include financial market conditions, our market value, our reserve levels and our operating performance at the
         time of such offering or other financing. We cannot assure you that any such offering, refinancing or sale of assets can be
         successfully co mpleted. The inability to repay or refinance our debt could have a material adverse effect on our operations
         and negatively impact our capital program.


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            A change of control may adversely affect our liquidity and require refinancing of certain debt instruments.

               Upon certain specified change of control events, each lender under our debt agreements may cancel the facility and
         declare as due and payable any outstanding loans plus accrued and unpaid interest, outstanding letters of credit and other
         outstanding fees. We cannot assure you we would have sufficient financial resources to purchase the notes for cash or repay
         the lenders under our debt agreements upon the occurrence of a change of control. If a change of control occurs, we may be
         required to refinance our indebtedness. There can be no assurance that we would be able to refinance our indebtedness or, if
         a refinancing were to occur, that the refinancing would be on terms favorable to us.


            If we are unable to fulfill commitments under any of our oil and gas interests, we will lose our interest, and our entire
            investment, in such interest.

               Our ability to retain oil and gas interests will depend on our ability to fu lfill the co mmit ments made with respect to each
         interest. We cannot assure you that we or the other participants in the projects will have the financial ab ility to fund thes e
         potential co mmit ments. If we are unable to fulfill co mmit ments under any of our interests, we will lose our interest, and our
         entire investment, in such interest.


         Risks Related to Environmental and Other Regul ations

            We are subject to environmental regulations that can have a significant impact on our operations.

               Our operations are subject to a variety of national, state, local and international laws and regulations governing the
         discharge of materials into the environment or otherwise relat ing to environmental p rotection. Failure to co mply with these
         laws and regulations can result in the imposition of substantial fines and penalties as well as potential orders suspending or
         terminating our rights to operate. Some environ mental laws to which we are subject to provide for strict liability fo r
         pollution damages and cleanup costs, rendering a person liable without regard to negligence or fault on the part of such
         person. In addition, we may be subject to claims alleging personal injury or property damage as a result of alleged exposure
         to hazardous substances such as oil and gas related products. Aquatic enviro nments in which we operate are often
         particularly sensitive to environmental impacts, which may expose us to greater potential liab ility than that associated with
         exploration, develop ment and production at many onshore locations.

              Changes in environmental laws and regulations occur frequently, and any changes that result in more stringent or costly
         requirements for oil and gas exploration and production activities could require us, as well as others in our industry, to ma ke
         significant expenditures to attain and maintain co mp liance which could have a corresponding material adverse effect on our
         competitive position, financial condition or results of operations. We cannot provide assurance that we will be ab le to
         comply with future laws and regulations to the same extent that we have comp lied in the past. Similarly, we cannot always
         precisely predict the potential impact of environ mental laws and regulations which may be adopted in the future, including
         whether any such laws or regulat ions would restrict our operations in any area.

              Current and future environ mental regulations, including restrict ions on emissions of greenhouse gases due to concerns
         about climate change, could reduce the demand for our products. Our business, financial condition and results of operations
         could be materially and adversely affected if this were to occur.

              Under certain environmental laws and regulations, we could be subject to liability arising out of the conduct of
         operations or conditions caused by others, or for activ ities that were in co mpliance with all applicable laws at the time they
         were performed. Such liabilities can be significant, and if imposed could have a material adverse effect on our financial
         condition or results of operations.


            Governmental regulations to which we are subject could expose us to significant fines and/or penalties and our cost of
            compliance with such regulations could be substantial.

              Oil and gas explorat ion, development and production are subject to various types of regulation by local, state and
         national agencies. Regulations and laws affecting the oil and gas industry are comp rehensive and


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         under constant review for amend ment and expansion. These regulations and laws carry substantial penalties for failure to
         comply. The regulatory burden on the oil and gas industry increases our cost of doing business and, consequently, adversely
         affects our profitability. In addition, co mpetit ive conditions may be substantially affected by various forms of energy
         legislation and/or regulation considered fro m t ime to time by the governments and/or agencies thereof.


            Federal and state legislative regulatory initiatives relating to hydraulic fracturing could result in increased costs and
            additional operating restrictions or delays.

               Hydraulic fracturing is an important and common practice that is used to stimu late prod uction of hydrocarbons,
         particularly natural gas, fro m tight formations. We routinely utilize hydraulic fracturing techniques in many of our natural
         gas well d rilling and co mpletion programs. The process involves the injection of water, sand and chemicals under pressure
         into the formation to fracture the surrounding rock and stimu late production. The process is typically regulated by state oil
         and gas commissions. However, the EPA recently asserted federal regulatory authority over hydraulic fracturing invo lving
         diesel additives under the Safe Drinking Water Act’s Underground Injection Control Program. While the EPA has yet to take
         any action to enforce or implement this newly asserted regulatory authority, industry groups have filed suit challenging the
         EPA’s recent decision. At the same time, the EPA has commenced a study of the potential environmental impacts of
         hydraulic fracturing activit ies. Legislation has been introduced before Congress to provide for federal regulation of hydraul ic
         fracturing and to require d isclosure of the chemicals used in the fracturing process. In addition, some states have adopted,
         and other states are considering adopting, regulations that could impose more stringent permitting, disclosure and well
         construction requirements on hydraulic fracturing operations. For examp le, Pennsylvania, Co lorado, and Wyoming have
         each adopted a variety of well construction, set back, and disclosure regulations limit ing how fracturing can be performed
         and requiring various degrees of chemical d isclosure. If new laws or regulations that significantly restrict hydraulic
         fracturing are adopted, such laws could make it more difficult or costly for us to perform fracturing to stimu late production
         fro m t ight formations. In addition, if hydraulic fracturing becomes regulated at the federal level as a result of federal
         legislation or regulatory in itiatives by the EPA, our fracturing activit ies could become subject to additional permitting
         requirements, and also to attendant permitting delays and potential increases in costs. Restrictions on hydraulic fracturing
         could also reduce the amount of oil and natural gas that we are ultimately able to produce fro m our reserves.


            Climate change legislation or regulations restricting emissions of “greenhouse gases” could result in increased
            operating costs and reduced demand for the crude oil and natural gas that we produce.

              There are a nu mber o f programs at the international, national, and local levels that aim to reduce greenhouse gas
         emissions. Changes to the existing laws or the enactment of new laws and regulations could increase our operating costs and
         reduce demand for our p roducts. At this time, there is substantial uncertainty about the future of GHG emission limitations in
         the areas where we operate. For exa mple, the first commit ment period of the Kyoto Protocol is due to expire in 2012.
         Because the Cancun negotiations failed to reach a binding global agreement on climate change, we face uncertainty
         regarding the structure of a future international regime and potential imp lementing national laws addressing GHGs.

               Rapid ly evolving domestic legal and regulatory structures governing GHG emissions may increase the costs imposed
         upon our operations. For example, since December 2009, the United States Environ mental Protection Agency has declared
         that GHGs threaten the environment, imposed limitations on GHGs fro m mob ile sources and certain large stationary sources,
         and required certain industries to monitor and report their GHG emissions. These rules are all current ly subject to legal
         challenges, but to this point, federal courts have refused to prevent EPA fro m implementing them. In addit ion, by the end of
         2012, the EPA intends to impose New Source Performance Standards under the Clean Air Act that will apply to all
         fossil-fuel fired power plants and petroleum refineries. To the extent we o r our customers are subject to any of these
         regulations, we may face increased costs and decreased demand for our p roduct.

              The adoption of legislation or regulatory programs to reduce emissions of greenhouse gases could require us to incur
         increased operating costs, such as costs to purchase and operate emissions control systems, to


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         acquire emissions allowances or co mply with new regulatory or reporting requirements. Any such legislation or regulatory
         programs could also increase the cost of consuming, and thereby reduce demand for, the oil and natural gas we produced.
         Consequently, legislation and regulatory programs to reduce emissions of greenhouse gases could have an adverse effect on
         our business, financial condition and results of operations.


            The recent adoption of derivatives legislation by the United States Congress could hav e an adverse effect on our ability
            to use derivative instruments to reduce the effect of commodity price, interest rate and other risks associated with our
            business.

               The United States Congress adopted comprehensive financial reform legislation that estab lishes federal oversight and
         regulation of the over-the-counter derivatives market and entities, such as us, that participate in that market. The new
         legislation, known as the Dodd-Frank Wall Street Refo rm and Consumer Protection Act (the “Act”), was signed into law by
         the President on July 21, 2010 and requires the Co mmod ities Futures Trading Co mmission (the “CFTC”) and the SEC to
         promu lgate rules and regulations implementing the new legislation with in 360 days fro m the date of enactment. In its
         rulemaking under the Act, the CFTC has proposed regulations to set position limits for certain futures and option contracts in
         the major energy markets and for swaps that are their economic equivalents. Certain bona fide hedging transactions or
         positions would be exempt fro m these position limits. It is not possible at this time to predict when the CFTC will finalize
         these regulations. The financial reform legislat ion may also require us to comply with margin requirements and with certain
         clearing and trade-execution requirements in connection with our derivative activit ies, although the application of those
         provisions to us is uncertain at this time. The financial reform leg islation may also require the counterparties to our
         derivative instruments to spin off some of their derivatives activities to a separate entity, which may not be as creditworthy
         as the current counterparty. The new legislation and any new regulations could significantly increase the cost of derivative
         contracts (including through requirements to post collateral wh ich could adversely affect our available liquidity), materially
         alter the terms of derivative contracts, reduce the availability of derivatives to protect against risks that we encounter, reduce
         our ability to monetize o r restructure our e xisting derivative contracts, and increase our exposure to less creditworthy
         counterparties. If we reduce our use of derivatives as a result of the legislation and regulations, our results of operations may
         become more volatile and our cash flows may be less predictable, which could adversely affect our ab ility to plan for and
         fund capital expenditures. Finally, the leg islation was intended, in part, to reduce the volatility of o il and natural gas prices,
         which some legislators attributed to speculative trading in derivatives and commodity instruments related to oil and natural
         gas. Our revenues could therefore be adversely affected if a consequence of the legislation and regulations is to lower
         commodity prices. Any of these consequences could have a material, adverse effect on us, our financial condition, and our
         results of operations.


            Certain federal income tax deductions currently available with respect to oil and natural gas exploration and
            development may be eliminated as a result of proposed legislation.

               Legislat ion has been proposed that would, if enacted into law, make significant changes to U.S. federal inco me tax
         laws, including the elimination of certain key U.S. federal inco me tax incentives currently available to oil and natural gas
         exploration and production companies. These changes include, but are not limited to, (i) the repeal of the percentage
         depletion allo wance for o il and natural gas properties, (ii) the elimination of current deductions for intangible d rilling and
         development costs, (iii) the elimination of the deduction for certain do mestic production activities, and (iv) an extension of
         the amortizat ion period for certain geological and geophysical expenditures. It is unclear whether these or similar changes
         will be enacted and, if enacted, how soon any such changes could become effective. The passage of this legislation or any
         other similar changes in U.S. federal inco me tax laws could eliminate or postpone certain tax deductions that are currently
         available with respect to oil and natural gas exp loration and development, and any such change could negatively impact the
         value of an investment in our co mmon stock.


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         Risks Related to Potential Impairments

            Our financial results could be adversely affected by goodwill impairments.

               As a result of mergers, acquisitions and dispositions, at December 31, 2010 we had $211.9 million of goodwill on our
         balance sheet. Goodwill is not amortized, but instead must be tested at least annually for impairment by applying a
         fair-value-based test. Goodwill is deemed impaired to the extent that its carrying amount exceeds the fair value of the
         reporting unit. Although our latest tests indicate that no goodwill impairment is currently required, future deterioration in
         market conditions could lead to goodwill impairments that could have a substantial negative effect on our profitability.

               Lower o il and gas prices and other factors may result in ceiling test write-downs or other impairments.

               We capitalize the costs to acquire, find and develop our oil and gas properties under the full cost accounting method.
         The net capitalized costs of our oil and gas properties may not exceed the present value of estimated future net cash flows
         fro m proved reserves, plus the lower of cost or fair market value for unproved properties. This quarterly test is called a
         “ceiling test.” If net capitalized costs of our oil and gas properties exceed this ceiling test, we must charge the amount of the
         excess to earnings. Although a ceiling test write-down does not impact cash flow fro m operating activit ies, it does reduce net
         income and our shareholders ’ equity. Once recorded, a ceiling test write-down is not reversible at a later date even if o il and
         gas prices increase.

              We review the net capitalized costs of our properties quarterly, based on prices in effect (excluding the effect of our
         hedging contracts that are not designated for hedge accounting) as of the end of each quarter or as of the time of reporting
         our results. We also assess investments in unproved properties periodically to determine whether impairment has occurred.

               The risk that we will be required to further write down the carrying value of our oil and gas properties increases when
         oil and gas prices are low or volatile. In addition, write-downs may occur if we experience substantial downward
         adjustments to our estimated proved reserves or our unproved property values, or if estimated future development costs
         increase. We may experience further ceiling test write-downs or other impairments in the future. In addit ion, any future
         ceiling test cushion would be subject to fluctuation as a result of acquisition or divestiture activity.


         Risks Related to Our Common Stock

            An active liquid trading market for our common stock may not be maintained and the trading price of our common
            stock may be volatile.

              Liquid and active trading markets usually result in less price volatility and more efficiency in carry ing out stockholders ’
         purchase and sale orders. Smaller capitalized co mpanies like ours often experience substantial fluctuations in the trading
         price of their securities. An active and liquid trad ing market for our co mmon stock may not be maintained. In 2010, we
         undertook a one-for-seven share consolidation which significantly reduced the number of shares outstanding and eligible for
         trading. The trading price of our co mmon stock has fluctuated significantly and may be subject to similar fluctuations in the
         future. The market price of our common stock could vary significantly as a result of a nu mber of factors, some o f which are
         beyond our control.


            If we, o ur existing or fut ure stockholders or holders of our securities that are convertible into shares of our common
            stock sell a substantial number of shares o f our common stock, the market price of our common stock could
            significantly decline.

              The market p rice o f our co mmon stock could decline as a result of sales of a large nu mber of shares of common stock in
         the public market or the perception that such sales could occur. These sales, or the possibility that these sales may occur,
         might make it mo re d ifficult for us to sell equity securities in the future at a t ime and at a price that we deem appropriate.


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               As of February 28, 2011, we had appro ximately 24.9 million shares of common stock outstanding. Of those shares,
         approximately 0.9 million shares were restricted shares subject to vesting within three years. The remainder of these shares
         are freely tradable.

              In addition, 0.3 million shares are issuable upon the exercise of presently outstanding stock options under our emp loyee
         incentive plans and 0.1 million shares are issuable upon the exercise of presently outstanding options and warrants outside
         our emp loyee incentive plans. Also, 2.3 million shares are issuable upon the conversion of our 6% Convertible Senior Notes
         and 5.1 million shares are issuable upon conversion of our Series C Preferred Stock, based upon the conversion price of
         $8.75 per share, and 3.4 million shares are issuable upon conversion of our 11.5% Convertible Bonds, based on a conversion
         price of $16.52.


            Provisions in our articles of incorporation, bylaws and the Nevada Revised Statutes may discourage a change of
            control.

               Certain provisions of our amended and restated articles of incorporation and amended and restated bylaws and the
         Nevada Revised Statutes (“NRS”) could delay or make more difficult a change of control transaction or other business
         combination that may be beneficial to stockholders. These provisions include, but are not limited to, the ability of our board
         of directors to issue a series of preferred stock, classificat ion of our board of directors into three classes and limiting t he
         ability of our stockholders to call a special meeting.

               We are subject to the “Combinations With Interested Stockholders Statute” and the “Control Share Acquisition Statute”
         of the NRS. The Co mbinations Statute provides that specified persons who, together with affiliates and assoc iates, own, or
         within three years did o wn, 10% or mo re of the outstanding voting stock of a corporation cannot engage in specified
         business combinations with the corporation for a period of three years after the date on which the person became an
         interested stockholder, unless the combination or the transaction by which the person first became an interested stockholder
         is approved by the corporation’s board of directors before the person first became an interested stockholder.

               The Control Share Acquisition Statute provides that persons who acquire a “controlling interest” as defined by the
         statute, in a company may only be given fu ll voting rights in their shares if such rights are conferred by the stockholders o f
         the company at an annual or special meeting. However, any stockholder that does not vote in favor of granting such voting
         rights is entitled to demand that the company pay fair value for their shares if the acquiring person has acquired at least a
         majority of all of the voting power of the co mpany. As such, persons acquiring a controlling interest may not be able to vote
         their shares.


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                                                             US E OF PROCEEDS

              We expect the net proceeds from this offering to be appro ximately $        million (or appro ximately $   million if the
         underwriters exercise their over-allot ment option in full), after deducting estimated fees and expenses (including
         underwrit ing discounts and commissions). We intend to use the net proceeds fro m this offering to repurchase or redeem all
         $81.25 million of our 6.00% convertible senior notes due 2012. The remain ing net proceeds will be used for general
         corporate purposes.

              We recently amended the terms of our 2014 Convertible Bonds to extend the date upon which the holders ’ may exercise
         a put right, as required by the terms of our Senior Term Loan. Please read “Su mmary — Recent
         Develop ments — Amend ment of 11.5% Convertib le Bonds due 2014.” Following the amend ment of our 2014 Convertible
         Bonds and the application of the net proceeds fro m this offering to repurchase or redeem all $81.25 million of our 2012
         Convertible Notes, our Senior Term Loan will mature on August 16, 2013. Previously, our Senior Term Loan could have
         become due and payable in full on October 14, 2011.


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                                                              CAPITALIZATION

               The following table sets forth our capitalizat ion at December 31, 2010:

               • on an actual basis; and

               • on an as adjusted basis to give effect to our application of the estimated net proceeds from this offering in the
                 manner described in “Use of Proceeds.”

              You should read the following table in conjunction with “Management’s Discussion and Analysis of Financial
         Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2010, which is
         incorporated by reference herein.


                                                                                                             As of December 31, 2010
                                                                                                             Actual            As Adjuste d
                                                                                                              (Dollars in thousands)


         Cash, cash equivalents and restricted cash(1)                                                   $    131,043         $

         Long-term debt(2):
           6.0% convertible senior notes due 2012                                                        $     81,250         $        —
           11.5% convertible bonds due 2014(3)                                                                 55,821              55,821
           12.0% subordinated notes due 2014                                                                   51,132              51,132
           15.0% senior term loan due 2013                                                                    161,371             161,371

            Total long-term debt                                                                         $    349,574         $ 268,324

         Series C convertible preferred stock ($45,000 liquidation preference)(4)                        $     53,152         $    53,152
         Stockholders’ equity:
           Series B preferred stock ($3,273 liquidation preference)                                      $          —         $         —
           Co mmon stock (24,784 shares issued and outstanding, actual; 32,784 shares issued and
              outstanding, as adjusted)                                                                            25
           Additional paid-in capital                                                                         287,995
           Treasury stock, at cost (72 shares, actual and as adjusted)                                           (587 )               (587 )
           Accumulated deficit                                                                               (132,815 )

            Total stockholders’ equity                                                                   $    154,618         $

         Total capitalization                                                                            $    557,344         $



           (1) Includes $31.8 million of restricted cash.

           (2) Includes approximately $21.6 million of current maturities.

           (3) Pursuant to an amend ment we entered into on March 11, 2011, the maturity date of the 11.5% convertible bonds was
               amended fro m January 24, 2014 to January 24, 2016.

           (4) Includes approximately $8.2 million of net non-cash premiu ms under fair value accounting on redemption.


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                                                  PRICE RANGE OF COMMON STOCK

              Our co mmon stock is quoted on the New York Stock Exchange under the symbol “END” and the London Stock
         Exchange under the symbol “ENDV.” Prior to March 15, 2011, our co mmon stock was quoted on the NYSE A mex under
         the symbol “END.”

              In October 2010, our Board of Directors authorized a share consolidation of our co mmon stock, in the form of a
         one-for-seven reverse stock split. This consolidation was effective at the opening of trading on November 18, 2010. As a
         result of the share consolidation, every seven shares of our common stock outstanding were automatically co mb ined into one
         share of our common stock. Each shareholder continued to hold the same percentage of our outstanding common shares. The
         share consolidation was intended to make our co mmon stock available to a broader range of investors and reposition the
         company’s trading metrics.

             All share informat ion and prices per share have been restated to reflect the share consolidation. The following table
         shows, for the periods indicated, the high and low reported sales prices for our co mmon stock, as reported on the NYSE
         Amex.


                                                                                                                       Sales Price
                                                                                                                High                 Low


         2009:
           First quarter                                                                                    $    7.21           $     3.22
           Second quarter                                                                                       15.47                 5.81
           Third quarter                                                                                        10.50                 7.14
           Fourth quarter                                                                                        9.10                 5.74
         2010:
           First quarter                                                                                    $ 10.36             $     5.60
           Second quarter                                                                                     12.18                   7.14
           Third quarter                                                                                      10.22                   6.72
           Fourth quarter                                                                                     14.16                   8.12
         2011:
           First quarter (through March 14, 2011)                                                           $ 14.51             $ 11.60

               On March 14, 2011, the last sales price of our co mmon stock as reported on the NYSE A mex was $12.60 per share.

               As of February 28, 2011, there were appro ximately 199 holders of record of our co mmon stock.


                                                            DIVIDEND POLICY

              We have not paid any cash dividends on our common stock to date and have no intention of declaring or paying any
         cash dividends on our common stock in the foreseeable future. The declaration and payment of d ividends is subject to the
         discretion of our Board o f Directors and to certain limitations imposed under Nevada corporate laws and the agreements
         governing our debt obligations. The timing, amount and form of div idends , if any, will depend on, among other things, our
         results of operations, financial condition, cash requirements and other factors deemed relevant by our Board of Directors.

               Our Series B Preferred Stock is subject to a cumulative 8% div idend. Unless the full amount of the div idends accrued
         for the Series B Preferred Stock is paid in full, we cannot declare or pay any dividend on our common stock. In addit ion,
         certain of our debt facilities contain restrictions on the payment of dividends to the holders of our common stock.


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                                                    DES CRIPTION OF CAPITAL S TOCK


         General

              Our amended and restated articles of incorporation authorize us to issue 74,285,714 shares of capital stock, consisting
         of 64,285,714 shares of common stock, par value $0.001 per share, and 10,000,000 shares of preferred stock, par value
         $0.001 per share. The following summary description of our capital stock is not complete and does not give effect to
         applicable statutory and common law. This summary description is also subject to the applicable provisions of our amended
         and restated articles of incorporation and amended and restated bylaws.

               The transfer agent and registrar for our co mmon stock is StockTrans, Inc., and its telephone number is (610) 649-7300.


         Common Stock

               As of March 11, 2011, there were 25,126,858 shares of our common stock issued and outstanding, including
         38,095 shares of unvested restricted common stock pursuant to inducement grants and 816,304 shares of unvested restricted
         stock awards pursuant to our stock option plans. In addition, as of March 11, 2011, 0.3 million shares are issuable upon the
         exercise of presently outstanding stock options under our employee incentive plans and 0.1 million shares are issuable upon
         the exercise of presently outstanding options and warrants outside our employee incentive plans. Also, (i) 2.3 million shares
         are issuable upon the conversion of our 6% Convertible Senior Notes, (ii) 5.1 million shares are issuable upon conversion of
         our Series C Preferred Stock, based upon the conversion price of $8.75 per share, and (iii) 3.5 million shares are issuable
         upon conversion of our 11.5% Convertible Bonds, based on a conversion price of $16.52.

              In October 2010, our Board of Directors authorized a share consolidation of our co mmon stock, in the form of a
         one-for-seven reverse stock split. This consolidation was effective at the opening of trading on November 18, 2010. As a
         result of the share consolidation, every seven shares of our common stock outstanding were automatically co mb ined into one
         share of our common stock. Each shareholder continues to hold the same percentage of our outstanding common shares. The
         shares were rounded up to the next whole share for those holders who would have otherwise received fractional shares. The
         share consolidation was intended to make our co mmon stock available to a broader range of investors and reposition the
         company’s trading metrics.

               Shares of our common stock are alike and equal in all respects and have one vote for each share held of record for the
         election of directors and all other matters submitted to the vote of stockholders. Holders of our co mmon stock do not have
         cumulat ive voting rights, and thus, holders of a majority of the shares of our common stock represented at a meeting at
         which a quoru m is present can elect all d irectors to be elected at such meeting. Subject to any restrictions imposed by any of
         our lenders and after any requirements with respect to preferential dividends, if any, on the preferred stock have been met,
         then, and not otherwise, dividends payable in cas h or in any other mediu m may be declared by our board of d irectors and
         paid on the shares of common stock out of funds legally available therefore. After satisfaction of all our debts and liabilit ies
         and distribution in full of the preferential amount, if any, to be distributed to the holders of preferred stock in the event of
         voluntary or involuntary liquidation, d issolution, distribution of assets or our winding -up, the holders of our co mmon stock
         shall be entitled to receive all of our remaining assets of whatever kind available for distribution to stockholders ratably in
         proportion to the number of shares of common stock held by them respectively. The holders of our common stock do not
         have any preferential, preempt ive right, or other right of subscription to acquire any of our shares authorized, issued or sold,
         or to be authorized, issued or sold (or any instrument convertible into our shares) other than to the extent, if any, our boa rd of
         directors may determine fro m t ime to time.


         Preferred Stock

              Our board of d irectors has the authority, without stockholder approval, to issue preferred stock in one or more series at
         such time or t imes and for such consideration as our board of directors may determine pursuant


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         to a resolution or resolutions providing for such issuance duly adopted by our board of directors and may determine, for any
         series of preferred stock, the terms and rights of the series, including the following:

               • the distinctive designation, stated value and number of shares comprising such series, which nu mber may (except
                 where otherwise provided by our board of directors in creating such series) be increased or decreased (but not below
                 the number of shares then outstanding) fro m t ime to t ime by action of our board of directors;

               • the rate of dividend, if any, on the shares of that series, whether dividends shall be cu mulat ive and, if so, fro m wh ich
                 date, and the relative rights of priority, if any, of pay ment of div idends on shares of that series over shares of any
                 other series;

               • whether the shares of that series shall be redeemable and, if so, the terms and conditions of such redemption,
                 including the date upon or after which they shall be redeemable, and the amount per share payable in case of
                 redemption, which amount may vary under different conditions and at different redemption dates, or the property or
                 rights, including securities of any other corporation, payable in case of redemption;

               • whether that series shall have a sinking fund for the redemption or purchase of shares of that series and, if so, the
                 terms and amounts payable into such sinking fund;

               • the rights to which the holders of the shares of that series shall be entitled in the event of our voluntary or
                 involuntary liquidation, d issolution, distribution of assets or winding -up and the relative rights of priority, if any, o f
                 payment of shares of that series;

               • whether the shares of that series shall be convertible into or exchangeable for shares of capital stock of any class or
                 any other series of preferred stock and, if so, the terms and conditions of such conversion or exchange including the
                 rate of conversion or exchange, the date upon or after wh ich they shall be convertible or exchangeable, the duration
                 for which they shall be convertible or exchangeable, the event upon or after wh ich they shall be convertible or
                 exchangeable, at whose option they shall be convertible or exchangeable, and the method of adjusting the rate of
                 conversion or exchange in the event of a stock split, stock dividend, comb ination of shares or similar event;

               • whether the shares of that series shall have voting rights in addition to the voting rights provided by law and, if so,
                 the terms of such voting rights;

               • whether the issuance of any additional shares of such series, or of any shares of any other series, shall be subject to
                 restrictions as to issuance, or as to the powers, preferences or rights of any such other series; and

               • any other preferences, privileges and powers, and relative, part icipating, optional or other special rights, and
                 qualification, limitat ion or restriction of such series, as our board of directors may deem advisable and as shall not
                 be inconsistent with the provisions of our amended and restated articles of incorporation and to the full extent now
                 or hereafter permitted by the laws of the State of Nevada.

              Because the holders of our preferred stock may be entitled to vote on some matters as a class, issuan ce of our preferred
         stock could have the effect of delaying, deferring or preventing a change of control. The rights of the holders of our common
         stock may be adversely affected by the rights of the holders of preferred stock that may be issued in the futu re. The issuance
         of preferred stock, while p roviding desirable flexib ility, could have the effect of making it more difficu lt for a third part y to
         acquire control of us.


            Series B Preferred Stock

              Of the 10,000,000 shares of our authorized preferred stock, 376,287 shares are designated as Series B Preferred Stock,
         par value $0.001 per share. The authorized shares of Series B Preferred Stock were originally 500,000 shares, however, as a
         result of our repurchase of an aggregate of 123,713 shares of Series B Preferred Stock in connection with our February 2004
         restructuring, the authorized shares were reduced fro m 500,000 to 376,287.


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               The Series B Preferred Stock generally provides for the follo wing rights, preferences and obligations:

               • the shares of Series B Preferred Stock accrue a cu mulat ive dividend of 8% of the $100 original issue price of such
                 shares per annum, which is payable before any dividend or other distribution on shares of our common stock;

               • in the event of our liquidation, dissolution, or winding up, the shares of Series B Preferred Stock have a liquidation
                 preference of $100 per share (p lus all accrued and unpaid dividends thereon) before any payment or distribution to
                 holders of shares of our common stock;

               • except as otherwise provided by law, holders of shares of Series B Preferred Stock have the right to vote together
                 with the holders of our co mmon stock on all matters presented to holders of our common stock and have one vote
                 per share; and

               • we also have the right to redeem all or any portion of the Series B Preferred Stock at any time by payment of $100
                 per share plus all accrued and unpaid dividends due thereon .

               As March 11, 2011, there were 19,714 shares of Series B Preferred Stock issued and outstanding.


            Series C Preferred Stock

               In 2006, we issued the Series C Preferred Stock. Dividends on the Series C Preferred Stock are:

               • cumulat ive;

               • compounded quarterly based on the original issue price;

               • payable in cash or common stock, at 4.5% or 4.92%, respectively, since November 2009 and at 8.5% or 8.92%,
                 respectively, in prior periods; and

               • payable to the preferred stock investors prior to payment of any other dividend on any other shares of our capital
                 stock.

              The Series C Preferred Stock ran ks senior to any of our other existing or future shares of capital stock. Dividends will
         be paid to the preferred stock investors prior to payment of any other div idend on any other shares of our capital stock. The
         Series C Preferred Stock also participates on an as -converted basis with respect to any dividends paid on the common stock.

             On November 17, 2009, we redeemed 60% o f the outstanding shares of Series C Preferred Stock, for face value of
         $75 million, and amended the terms of the remaining shares of Series C Preferred Stock. The redempt ion price consisted of a
         $25 million cash payment and the is suance of $50 million of Subordinated Notes.

              The redemption and modificat ion of the Series C Preferred Stock required the modified Series C Preferred Stock to be
         recorded at fair market value at the redemption date. The fair value of the modified Series C Preferred Stock was greater
         than the carrying value by $11.5 million. Th is excess of fair value over carrying value was recorded as a non -cash charge to
         preferred stock dividends and increased the carrying value of the Series C Preferred Stock. As holders convert the Series C
         Preferred Stock, the $11.5 million non-cash charge will be transferred to equity on a ratio o f shares converted to shares of
         Series C Preferred Stock outstanding.

               In addition to the modificat ion of the Series C Preferred Stock, we also recorded an embedded derivative associated
         with the change in control features of the Series C Preferred Stock of $2.4 million. This embedded derivative was recorded
         in other liabilities and reduced the premiu m on the Series C Preferred Stock at the date of issuance. At December 31, 2010
         the fair market value of this derivative was an asset of $0.3 million, reflecting a $2.3 million gain during 2010 that was
         recorded in unrealized gains (losses) on derivatives.

                The Series C Preferred Stock is convertible into co mmon stock at any time at the option of the preferred stock investors,
         at (i) a conversion price of $8.75 (the “Conversion Price”) and (ii) in an amount of common stock equal to the quotient of
         $1,000 per share div ided by the Conversion Price.
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               In the November 2009 amend ment, we amended terms of the Series C Preferred Stock to reduce the annual dividend
         rate to 4.5% (fro m 8.5%), adjust the conversion price to $8.75 per share (fro m $17.50) and remove certain anti -dilution
         provisions.

               Issuance of dividends in the form of co mmon stock are subject to the follo wing equity conditions (the “Equity
         Conditions”), wh ich are waivable by two-thirds of the holders of the Series C Preferred Stock: (i) such common stock is
         listed on the NYSE AMEX, the New Yo rk Stock Exchange or the Nasdaq Stock Market, and not subject to any trading
         suspension; (ii) we are not then subject to any bankruptcy event; and (iii) such common stock will be immediately
         re-saleable by the holders pursuant to an effective registration statement and otherwise in co mpliance with all applicable
         laws. If we have not maintained the effectiveness of the registration statement pursuant to the registration rights section
         below, then the dividend rate on the Series C Preferred Stock will be increased by the product of 2.5% (if the div idend is
         paid in cash) or 2.63% (if the dividend is paid in stock) times the number o f quarters (or portions thereof) in which the
         failure occurs or we fail to cure such failure.

               After the fourth anniversary of the initial issuance of the Series C Preferred Stock, we may redeem all of the Series C
         Preferred Stock in exchange for a cash payment to the preferred stock investors of an amount equal to 102% of the sum of
         $1,000 plus accrued but unpaid dividends (such sum, the “Liquidation Preference”). If we call the Series C Preferred Stock
         for redemption, the holders thereof will have the right to convert their shares into a newly issued preferred stock identical in
         all respects to the Series C Preferred Stock except that such newly issued preferred stock will not bear a div idend (th e
         “Alternate Preferred Stock”). We may not redeem the Convertible Preferred Stock if the Equity Conditions are not then
         satisfied with respect to the common stock into which the Alternate Preferred Stock is convertible.

              Upon the tenth anniversary of the initial issuance of the Series C Preferred Stock, we must redeem all of the Series C
         Preferred Stock for an amount equal to the Liquidation Preference payable by us in cash or common stock at our elect ion.
         Issuance by us of common stock for such redemption is subject to the Equity Conditions and to the market value of the
         outstanding shares of common stock immediately prior to such redemption equaling at least $500 million.

              In the event of a change of control of Endeavour, we will be required to offer to redeem all of the Series C Preferred
         Stock for the greater of: (i) the amount equal to which such holder would be entitled to receive had the holder converted such
         Series C Preferred Stock into common stock; (ii) 115% of the sum of the Liquidation Preference; and (iii) the amount
         resulting in an internal rate of return to such holder of 15% fro m the date of issuance of such Series C Preferred Stock
         through the date that Endeavour pays the redemption price fo r such shares.

               On January 29, 2010, we and the holders of our outstanding Series C Convertible Preferred Stock corrected a technical
         oversight in the Subscription and Registration Rights Agreement for our Series C Preferred Stock. The amend ment aligns the
         number of common shares reserved for the potential conversion of the Series C Preferred Stock to the terms of the Series C
         Convertible Preferred Stock after our partial redemption in November 2009. On March 10, 2010, we also amended the
         Cert ificate of Designation for the Series C Preferred Stock and the $50 million subordinated notes issued to the holders of
         the Series C Preferred Stock to make certain technical changes that align certain definitions and provisions relating to
         potential repurchases of securities by us.

            In 2010, a co mbined 5,000 shares of our Series C Preferred Stock were converted into 0.6 million shares of our
         common stock.


         Anti -Takeover Provisions of our Articles of Incorporation and Byl aws

               Our amended and restated articles of incorporation and amended and restated bylaws contain provisions that could
         delay, discourage or make mo re difficult a tender offer, pro xy contest or other takeover attempt that is opposed by our board
         of directors but that a stockholder might consider in its best interest. The following is a summary of these provisions.


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            Preferred Stock

               Although our board of directors has no current intent to do so, it could issue one or more series of preferred stock that
         could, depending on their terms, impede the comp letion of a merger, tender offer or other takeover attempt. Any decision by
         our board of directors to issue such preferred stock will be based on their judg ment as to the best interest of Endeavour and
         its stockholders.


            Special Meeting of Stockholders

               Our amended and restated bylaws provide that special meet ings of our stockholders can only be called by resolution of
         the board of directors or by the written request of stockholders owning a majority of the issued and outstanding capital stoc k
         entitled to vote.


            Classified Board of Directors

              Our bylaws provide that the members of our board of d irectors are div ided into three classes as nearly equal as possible.
         Each class is elected for a three-year term. At each annual meeting of stockholders, approximately one-third of the members
         of the board of directors are elected fo r a three-year term and the other directors remain in office until their three-year terms
         expire. Our amended and restated bylaws provide for one to fifteen directors (as determined by resolution of our board of
         directors). Ou r amended and restated bylaws also provide that any vacancies may be filled by a majority of the remaining
         directors, though less than a quorum, or by a sole remain ing director, and each director so elected shall hold office until h is
         successor is elected at an annual or special meeting of the stockholders. These provisions may impede a stockholder fro m
         gaining control of the board of directors by removing incumbent directors or increasing the number of d irectors and
         simu ltaneously filling the vacancies or newly created directorships with its own nominees.

              Notwithstanding the foregoing, our amended and restated bylaws provide that the holders of two -thirds of our
         outstanding shares of stock entitled to vote may at any time peremptorily terminate the term o f office of all or any of the
         directors by vote at a meeting called for such purpose or by a written statement filed with our secretary or, in his or her
         absence, with any other officer.


         Li mitations on Liability and Indemnificati on of Officers and Directors

                Our amended and restated articles of incorporation provide that none of our officers or d irectors will be personally
         liab le to us or our stockholders for damages for a breach of their fiduciary duties as a director or officer, other than (i) for
         acts or omissions that involve intentional misconduct, fraud or knowing violat ion of law or (ii) the unlawful payment of a
         distribution. In addition, our amended and restated articles of incorporation and amended and restated bylaws provide that
         we will indemn ify our officers and directors and advance related costs and expenses incurred by our officers and directors to
         the fullest extent permitted by Nevada law. In addition, we also may enter into agreements with any officer or d irector, and
         may obtain insurance, indemnifying such officers and directors against certain liabilit ies incurred by them. Such provisions
         may have the effect of preventing changes in our management.


         Nevada Anti-Takeover Statutes

               The Co mbinations Statute, contained in Sections 78.411 through 78.444 (inclusive) of the NRS, and the Control Share
         Statute, contained in Sections 78.378 through 78.3793 (inclusive) of the NRS, may have the effect of delaying or making it
         more difficult to effect a change in control of Endeavour. The Co mbinations Statute generally prohib its a Nevada
         corporation with 200 or more stockholders of record fro m engaging in certain “co mbinations,” such as a merger or
         consolidation, with an “interested stockholder” for a period of three years after the date of the transaction in which the
         person became an interested stockholder, unless the combination or the transaction by which the person first became an
         interested stockholder is approved by the board of directors of the company before the person first became an intere sted
         stockholder. The purpose of the


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         Co mbinations Statutes is to ens ure that management and stockholders of a Nevada corporation are involved in any potential
         and material changes to the corporate ownership structure. A “combination” means:

               • any merger or consolidation;

               • any sale, lease, exchange, mortgage, pledge, transfer or other disposition of the corporation ’s assets having a total
                 market value equal to 10% or more of the total market value of all the assets of the corporation; or 5% or mo re of
                 the total market value of all outstanding shares of the corporation or representing 10% or more of the earning power
                 of the corporation; or

               • the issuance or transfer by the corporation of any shares of the corporation that have an aggregate market value
                 equal to 5% or more of the aggregate market value of all the outstanding shares of the corporation to shareholders
                 except under the exercise of warrants or rights to purchase shares offered, or a d ividend or distribution paid or made,
                 pro rata to all shareholders of the corporation.

               An “interested stockholder” generally means:

               • a person or group that owns 10% or mo re of a corporation’s outstanding voting securities; or

               • an affiliate or associate of the corporation that at any time during the past three years was the owner of 10% or more
                 of the corporation’s then outstanding voting securities, unless the acquisition of the 10% or larger percentage was
                 approved by the board of directors before the acquisition.

                If this approval is not obtained, then after the exp iration of the three-year period, the business combination may be
         consummated with the approval of the board of directors or a majority of the voting power held by disinterested stockholders
         or if the consideration to be paid by the interested stockholder is fair as provided in the statute.

               The Control Share Statute governs acquisitions of a controlling interest of certain publicly held co rporations. The
         purpose of the Control Share Statute, like the Co mbinations Statute, is to statutorily provide management a measure of
         involvement in connection with potential changes of control. The Control Share Statute will apply to us if we have 200 or
         more stockholders of record, at least 100 of who m have addresses in Nevada, unless the amended and restated articles of
         incorporation or amended and restated bylaws in effect on the tenth day after the acquisition of a controlling interest provide
         otherwise. These provisions provide generally that any person that acquires a “controlling interest” acquires voting rights in
         the control shares, as defined, only as conferred by the stockholders of the corporation at a special or annual meeting. If
         control shares are accorded full voting rights and the acquiring person has acquired at least a majority of all of the voting
         power, any stockholder of record who has not voted in favor of authorizing voting rights for the control shares is entitled t o
         demand payment for the fair value o f its shares. A person acquires a “controlling interest” whenever a person acquires shares
         of a subject corporation that, but for the application of the Control Share Statute, would enable that person to exercise:

               • one-fifth or mo re, but less than one-third;

               • one-third or more, but less than a majority; or

               • a majority or mo re, of all o f the voting power of the corporation in the elect ion of directors.

              Once an acquirer crosses any one of these thresholds, shares that it acquired in the transaction taking it over the
         threshold and within the 90 days immed iately preceding the date when the acquiring person acquired or offered to acquire a
         controlling interest become “control shares.”


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            CERTAIN U.S. FEDERAL INCOME TAX CONS EQUENCES FOR NON -U.S. HOLDERS OF OUR COMMON
                                                  STOCK

             The following is a summary of certain U.S. federal inco me tax consequences to Non -U.S. holders with respect to the
         acquisition, ownership and disposition of our common stock. A “Non-U.S. holder” for purposes of this discussion is any
         beneficial owner of our co mmon stock who acquires such stock for cash pursuant to the terms of this prospectus supplement
         and who is not:

               • an individual citizen or resident of the United States, including an alien indiv idual who is a lawfu l permanent
                 resident of the United States;

               • a corporation (including an entity treated as a corporation for U.S. federal inco me tax purposes) created or organized
                 in the United States or under the laws of the Un ited States, any state thereof, or the District of Colu mbia;

               • an estate, the income of wh ich is subject to U.S. federal income tax regardless of its source; or

               • a trust (i) if a United States court can exercise primary supervision over the admin istration of the trust and one or
                 more Un ited States persons can control all substantial decisions of the trust, or (ii) that has a valid election in effect
                 under applicable Treasury Regulat ions to be treated as a United States person.

              An individual may generally be treated as a resident of the United States in any calendar year for U.S. federal inco me
         tax purposes, by, among other ways, being present in the United States for at least 31 days in that calendar year and for an
         aggregate of at least 183 days during a three-year period ending in the current calendar year. For purposes of the 183-day
         calculation, all of the days present in the current year, one-third of the days present in the immed iately preceding year and
         one-sixth of the days present in the second preceding year are counted. Residents are taxed for U.S. federal inco me tax
         purposes as if they were U.S. citizens.

               This discussion is based on current provisions of the Internal Revenue Code of 1986, as amended (the “Code”), final,
         temporary and proposed Treasury Regulations, judicial op inions, published positions of the Internal Revenue Service (the
         “IRS”) and ad ministrative and judicial authorities, all of wh ich are subject to change, possibly with retroactive effect, or are
         subject to different interpretations. This discussion assumes that a Non -U.S. holder holds our common stock as a capital
         asset (generally, property held for investment). This discussion does not address all aspects of U.S. federal inco me taxation
         (e.g., the alternative minimu m tax), any U.S. federal tax laws other than federal income tax laws (e.g., estate or gift tax laws)
         or any aspects of state, local, or non-U.S. taxat ion, nor does it consider any specific facts or circu mstances that may apply to
         particular Non-U.S. holders that may be subject to special treatment under the U.S. federal inco me tax laws, suc h as (without
         limitat ion):

               • certain U.S. expatriates;

               • shareholders that hold our common stock as part of a straddle, constructive sale transaction, synthetic security,
                 hedge, conversion transaction or other integrated investment or risk reduction transaction;

               • shareholders that acquired our common stock through the exercise of emp loyee stock options or otherwise as
                 compensation or through a tax-qualified retirement plan;

               • shareholders that are partnerships or other pass -through entities or holders of interests therein;

               • financial institutions;

               • insurance companies;

               • tax-exempt entit ies;

               • dealers in securities or fo reign currency; and

               • traders in securities that use a mark-to-market method of accounting for U.S. federal inco me tax purposes.
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              If a partnership (including an entity treated as a partnership for U.S. federal inco me tax purposes) holds our common
         stock, the tax treat ment of a partner of the partnership generally will depend upon the status of the partner and the activit ies
         of the partnership. If you are a partner of a partnership (including an entity treated as a partnership for U.S. federal income
         tax purposes) holding our common stock, you should consult your tax advisor.

              THIS DISCUSSION DOES NOT CONSTITUTE LEGA L A DVICE TO A NY PROSPECTIVE PURCHASER OF
         OUR COMMON STOCK. INVESTORS CONSIDERING THE PURCHASE OF OUR COMMON STOCK SHOULD
         CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF U.S. FEDERAL INCOM E TAX
         LAWS TO THEIR PA RTICULA R SITUATIONS AS W ELL AS ANY TA X CONSEQUENCES ARISING UNDER
         U.S. ESTATE AND GIFT TA X LAWS OR UNDER THE LAWS OF ANY STATE, LOCA L OR FOREIGN TA XING
         JURISDICTION OR UNDER ANY APPLICA BLE TA X TREATY.


         Di vi dends

               We do not expect to pay any cash distributions on our common stock in the foreseeable future. However, in the event
         we do make cash distributions, such distributions will be treated as dividends to the extent of our current and accumulated
         earnings and profits as determined under the Code and will be subject to withholding as discussed below. Any portion of a
         distribution that exceeds our current and accumulated earnings and profits will first be applied to reduce the
         Non-U.S. ho lder’s basis in the common stock and, to the extent such portion exceeds the Non-U.S. holder’s basis, the excess
         will be treated as gain fro m the disposition of the common stock, the tax t reatment of wh ich is discussed below under
         “— Gain on Sale or Other Disposition of Co mmon Stock”

                Div idends paid to a Non-U.S. holder on our co mmon stock will generally be subject to U.S. withholding tax at a rate of
         30% or such lower rate as may be specified by an applicab le income tax treaty. A Non -U.S. holder of our co mmon stock that
         wishes to claim the benefit of an applicab le treaty rate for div idends will be required to (i) co mp lete IRS Form W-8BEN (or
         other applicable form) and certify under penalties of perjury that such holder is not a United States person as defined under
         the Code and is elig ible for treaty benefits, or (ii) if our co mmon stock is held through certain foreign intermediaries, satisfy
         the relevant certification requirements of applicable Treasury Regulations. A Non -U.S. holder of our co mmon stock that is
         elig ible for a reduced rate of U.S. withholding tax pursuant to an income tax t reaty may obtain a refund of any excess
         amounts withheld by timely filing an appropriate claim for refund with the IRS.

               Div idends that are effectively connected with the conduct of a trade or busin ess by the Non-U.S. holder within the
         United States (and, where a tax treaty so requires, are attributable to a permanent establishment maintained by the
         Non-U.S. ho lder in the United States) are not subject to U.S. withholding tax, provided certain certificat ion and disclosure
         requirements are satisfied (wh ich generally may be met by providing an IRS Form W-8ECI). Instead, such dividends are
         subject to U.S. federal inco me tax on a net income basis in the same manner as if the Non -U.S. holder were a United States
         person as defined under the Code, unless an applicable inco me tax treaty provides otherwise. Any such effectively connected
         dividends received by a foreign corporation may be subject to an additional “branch profits tax” at a 30% rate or such lower
         rate as may be specified by an applicable inco me tax t reaty.


         Gain on Sale or Other Disposition of Common Stock

             In general, a Non-U.S. holder will not be subject to U.S. federal income tax on any gain realized upon the sale,
         exchange, redemption, retire ment or other taxable disposition of the Non-U.S. holder’s shares of common stock unless:

               • the gain is effectively connected with a trade or business carried on by the Non -U.S. holder within the Un ited States
                 (and, where an inco me tax t reaty so requires, is attributable to a U.S. permanent establishment maintained by the
                 Non-U.S. ho lder in the United States);


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               • the Non-U.S. holder is an indiv idual who is present in the United States for 183 days or more in the taxable year of
                 disposition and certain other conditions are met; or

               • we are a U.S. real property holding corporation or “USRPHC” for U.S. federal inco me tax purposes at any time
                 during the shorter of (i) the period during wh ich such Non-U.S. holder holds our stock, or (ii) the five-year period
                 ending on the date such Non-U.S. holder d isposes of our stock.

               A Non-U.S. holder described in the first bullet point above will be subject to tax on the gain realized fro m the sale or
         other disposition under regular graduated U.S. federal inco me tax rates in the same manner as if it were a United States
         person (as defined in the Code), and if the Non-U.S. holder is a corporation, it may also be subject to the branch profits tax at
         a rate of 30% of its effectively connected earnings and profits or at such lower rate as may be specifie d by an applicable
         income tax treaty.

              An individual Non-U.S. holder described in the second bullet point above will be subject to a flat 30% tax on the gain
         derived fro m the sale or other disposition, which may be offset by U.S. source capital losses, even though the individual is
         not considered a resident of the United States.

              Based on the location of the oil and natural gas properties and other real p roperty assets we currently own, we do not
         believe that we are a USRPHC. This determination could change depending on changes in the values of our oil and natural
         gas properties and other assets, and future acquisitions and divestitures of those assets. However, even if we are or beco me a
         USRPHC, so long as our common stock is considered to be “regularly traded on an established securities market (within the
         mean ing of the Code and applicable Treasury Regulat ions),” only a Non-U.S. holder who owns or has owned (actually or by
         applying certain constructive ownership rules) More than 5% o f our co mmon stock at any time during the shorter of (i) the
         five-year period preceding the date of disposition, or (ii) the holder’s holding period will be subject to U.S. federal inco me
         tax on the disposition of such common stock by reason of our status as a USRPHC.


         Information Reporting and B ackup Wi thhol ding

              We must report annually to the IRS and to a Non-U.S. holder the amount of div idends paid to such holder and any tax
         withheld with respect to those dividends, regardless of whether withholding is required. Copies of the in formation returns
         reporting such dividends and withholding may also be made available to the tax authorit ies in the country in which the
         Non-U.S. ho lder resides under the provisions of an applicable income tax treaty. U.S. backup withholding will be imposed
         on certain payments to persons that fail to furn ish the information required under the U.S. informat ion reporting
         requirements. A Non-U.S. holder will be exempt fro m this backup withholding if such holder properly provides a
         Form W-8BEN (o r valid substitute or successor form) cert ifying that it is not a United States person (as defined in the Code)
         or otherwise meets documentary evidence requirements for establishing that it is not a United States person or otherwise
         establishes an exemption. Although a Form W-8BEN or other documentary evidence may eliminate the need for backup
         withholding, see the discussion under “— Dividends” above relating to whether the general 30% withholding tax applies on
         dividends paid to a Non-U.S. holder.

               The gross proceeds from the disposition of our co mmon stock may be subject to information reporting and backup
         withholding. If a Non-U.S. holder sells our co mmon stock to or through a U.S. o ffice of a broker, the payment will be
         subject to both U.S. backup withholding and informat ion reporting unless such holder properly provided a Form W-8BEN
         certify ing under penalties of perjury that it is a Non-U.S. holder (and the payor does not have actual knowledge or reason to
         know that the holder is a Un ited States person, as defined under the Code) or it otherwise estab lishes an exemption. If a
         Non-U.S. ho lder sells our co mmon stock outside the United States through a non -U.S. office of a non-U.S. bro ker and the
         sales proceeds are paid to the Non-U.S. holder outside the United States, then the U.S. backup withholding and informat ion
         reporting requirements generally will not apply to that payment. However, U.S. informat ion reporting, but not backup
         withholding, will generally apply to a pay ment of sales proceeds, even if that payment is made outside the United States, if a
         Non-U.S. ho lder sells our co mmon stock through a non-U.S. office of a bro ker that has certain relationships with the United
         States unless the broker has documentary evidence in its files that the Non -U.S. holder is not a United States person and
         certain other conditions are met, or the Non-U.S. holder otherwise establishes an exempt ion.


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               Backup withholding is not an additional tax. Any amount withheld under the backup withholding ru les is allowable as a
         credit against the Non-U.S. holder’s U.S. federal inco me tax liability, if any, and a refund may be obtained if the amounts
         withheld exceed such holder’s actual U.S. federal income tax liab ility and the required informat ion or appropriate claim form
         is timely provided to the IRS.


         Addi tional Wi thhol ding Requirements

               Under leg islation enacted in March 2010, the relevant withholding agent may be required to withhold 30% of any
         dividends paid by us and the proceeds of a sale of our co mmon stock paid after December 31, 2012 to (i) a foreign financial
         institution unless such foreign financial institution (as specifically defined under those rules) agrees to verify, report and
         disclose its U.S. account holders and meets certain other specified requirements or (ii) a non-financial foreign entity that is
         the beneficial owner of the payment unless such entity certifies that it does not have any subs tantial U.S. owners or provides
         the name, address and taxpayer identification nu mber of each substantial U.S. owner and such entity meets certain other
         specified requirements.

             THE PRECEDING DISCUSSION OF CERTAIN U.S. FEDERA L INCOM E TA X CONSEQUENCES FOR
         NON-U.S. HOLDERS OF OUR COMMON STOCK IS FOR GENERA L INFORMATION ONLY AND SHOULD NOT
         BE CONSIDERED TA X ADVICE. EA CH PROSPECTIVE INVESTOR SHOULD CONSULT ITS OWN TA X ADVISOR
         REGA RDING THE PARTICULA R U.S. FEDERA L, STATE, LOCA L AND NON -U.S. TAX CONSEQUENCES OF T HE
         ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR COMMON STOCK, INCLUDING THE
         CONSEQUENCES OF ANY PROPOSED CHA NGE IN APPLICA BLE LAWS.


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                                                                 UNDERWRITING

             Citigroup Global Markets Inc. is acting as joint book-running manager of this offering and as representative of the
         underwriters named below. Subject to the terms and conditions stated in the underwriting agreement dated the date of this
         prospectus supplement, each underwriter named below has severally agreed to purchase, and we have agreed to sell to that
         underwriter, the number of shares set forth opposite the underwriter’s name.


         Underwriter                                                                                                    Number of Shares


         Citigroup Global Markets Inc.
         Canaccord Genuity Inc.
         C. K. Cooper & Co mpany
         Global Hunter Securit ies, LLC
         Rod man & Renshaw, LLC

            Total                                                                                                           8,000,000

              The underwrit ing agreement provides that the obligations of the underwriters to purchase the shares included in this
         offering are subject to approval of legal matters by counsel and to other conditions. The underwriters are obligated to
         purchase all the shares (other than those covered by the over-allot ment option described below) if they purchase any of the
         shares.

               Shares sold by the underwriters to the public will in itially be o ffered at the initial pub lic offering price set forth on the
         cover of this prospectus supplement. Any shares sold by the underwriters to securities dealers may be sold at a discount from
         the initial public offering price not to exceed $   per share. If all the shares are not sold at the initial offering price, the
         underwriters may change the offering price and the other selling terms.

               If the underwriters sell more shares than the total number set forth in the table above, we have granted to the
         underwriters an option, exercisable for 30 days fro m the date of this prospectus supplement, to purchase up to 1,200,000
         additional shares at the public offering price less the underwriting d iscount. The underwriters may exercise the option solely
         for the purpose of covering over-allot ments, if any, in connection with this offering. To the extent the option is exercised,
         each underwriter must purchase a number of addit ional shares approximately proportionate to that underwriter ’s init ial
         purchase commit ment. Any shares issued or sold under the option will be issued and sold on the same terms and conditions
         as the other shares that are the subject of this offering.

               We and our officers and directors have agreed that, subject to certain exceptions, for a period of 90 days fro m the date
         of this prospectus supplement, we and they will not, without the prior written consent of Cit igroup Global Markets Inc.,
         dispose of any shares of common stock or any securities convertible into, or exercisable, or exchangeable for, shares of
         common stock; or publicly announce an intention to effect any such transaction. Cit igroup Global Markets Inc. in its sole
         discretion may release any of the securities subject to these lock-up agreements at any time without notice.

             The shares are listed on the New York Stock Exchange under the symbol “END” and on the London Stock Exchange
         under the symbol “ENDV.”

              The following table shows the underwriting discounts and commissions that we are to pay to the underwriters in
         connection with this offering. These amounts are shown assuming both no exercise and full exercise of the underwriters ’
         over-allot ment option.


                                                                                                          No Exercise           Full Exe rcise


         Per share                                                                                        $                      $
         Total                                                                                            $                      $


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               In connection with the offering, the underwriters may purchase and sell shares in the open market. Purchases and sales
         in the open market may include short sales, purchases to cover short positions, which may include purchases pursuant to the
         over-allot ment option, and stabilizing purchases.

               • Short sales involve secondary market sales by the underwriters of a greater nu mber of shares than they are required
                 to purchase in the offering.

                    • “Covered” short sales are sales of shares in an amount up to the number of shares represented by the
                      underwriters’ over-allotment option.

                    • “Naked” short sales are sales of shares in an amount in excess of the number of shares represented by the
                      underwriters’ over-allotment option.

               • Covering transactions involve purchases of shares either pursuant to the over-allot ment option or in the open market
                 after the distribution has been completed in o rder to cover short positions.

                    • To close a naked short position, the underwriters must purchase shares in the open market after the distribution
                      has been completed. A naked short position is more likely to be created if the underwriters are concerned that
                      there may be downward pressure on the price of the shares in the open market after p ricing that could adversely
                      affect investors who purchase in the offering.

                    • To close a covered short position, the underwriters must purchase shares in the open market after the distribution
                      has been completed or must exercise the over-allot ment option. In determining the source of shares to close the
                      covered short position, the underwriters will consider, among other things, the price of shares available for
                      purchase in the open market as compared to the price at which they may purchase shares through the
                      over-allot ment option.

               • Stabilizing transactions involve bids to purchase shares so long as the stabilizing bids do not exceed a specified
                 maximu m.

              Purchases to cover short positions and stabilizing purchases, as well as other purchases by the underwriters for their
         own accounts, may have the effect of preventing or retarding a decline in the market price of the shares. They may also
         cause the price of the shares to be higher than the price that would otherwise exist in the open market in the absence of these
         transactions. The underwriters may conduct these transactions on the New York Stock Exchange, in the over-the-counter
         market or otherwise. If the underwriters co mmence any of these transactions, they may discontinue them at any time.

              Certain of the underwriters or their affiliates have performed co mmercial banking, investment banking and advisory
         services for us from time to time for which they have received customary fees and reimbursement of expenses. The
         underwriters or their affiliates may, fro m time to time, engage in transactions with and perform services for us in the
         ordinary course of their business for which they may receive customary fees and reimbursement of expenses.

              We have agreed to indemnify the underwriters against certain liabilit ies, including liabilit ies under the Securities Act, or
         to contribute to payments the underwriters may be required to make because of any of those liab ilit ies.


         Notice to Prospecti ve Investors in the European Economic Area

               In relation to each member state of the European Econo mic Area that has implemented the Prospectus Directive (each,
         a relevant member state), with effect fro m and including the date on which the Prospectus Directive is imp lemented in that
         relevant member state (the relevant imp lementation date), an offer of shares described in this prospectus supplement may not
         be made to the public in that relevant member state prior to the publicat ion of a prospectus in relation to the shares that has
         been approved by the competent authority in that relevant member state or, where appropriate, approved in another relevant
         member state and notified to the co mpetent authority in that relevant member s tate, all in accordance with the Prospectus
         Directive, except


                                                                        S-45
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         that, with effect fro m and including the relevant implementation date, an offer of securit ies may be offered to the public in
         that relevant member state at any time:

               • to any legal entity that is authorized or regulated to operate in the financial markets or, if not so authorized or
                 regulated, whose corporate purpose is solely to invest in securities;

               • to any legal entity that has two or more of (1) an average of at least 250 emp loyees during the last financial year;
                 (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as
                 shown in its last annual or consolidated accounts;

               • to fewer than 100 natural o r legal persons (other than qualified investors as defined below) subject to obtaining the
                 prior consent of the representative for any such offer; or

               • in any other circu mstances that do not require the publication of a prospectus pursuant to Article 3 of the Prospectus
                 Directive.

              Each purchaser of shares described in this prospectus supplement located with in a relevant member state will be
         deemed to have represented, acknowledged and agreed that it is a “qualified investor” within the meaning of Art icle 2(1)(e)
         of the Prospectus Directive.

              For purposes of this provision, the expression an “offer to the public” in any relevant member state means the
         communicat ion in any form and by any means of sufficient information on the terms of the offer and the securities to be
         offered so as to enable an investor to decide to purchase or subscribe the securities, as the exp ression may be varied in that
         member state by any measure implementing the Prospectus Directive in that member state, and the expression “Prospectus
         Directive” means Directive 2003/71/ EC and includes any relevant imp lementing measure in each relevant member state.

               The sellers of the shares have not authorized and do not authorize the making of any offer of shares through any
         financial intermediary on their behalf, other than offers made by the underwriters with a view to the final p lacement of the
         shares as contemplated in this prospectus supplement. Accordingly, no purchaser of the shares, other than the underwriters,
         is authorized to make any further offer of the shares on behalf of the sellers or the underwriters.


         Notice to Prospecti ve Investors in the United King dom

               This prospectus supplement and the accompanying prospectus are only being distributed to, and is only directed at,
         persons in the United Kingdom that are qualified investors within the mean ing of Article 2(1)(e) of the Prospectus Directive
         that are also (i) investment professionals falling within Article 19(5) o f the Financial Serv ices and Markets Act 2000
         (Financial Pro motion) Order 2005 (the “Order”) or (ii) high net worth entities, and other persons to whom it may lawfully be
         communicated, falling within Article 49(2)(a) to (d) of the Order (each such person being referred to as a “relevant person”).
         This prospectus supplement and its contents are confidential and should not be distributed, published or reproduced (in
         whole or in part) or disclosed by recipients to any other persons in the United Kingdom. Any person in the United Kingdom
         that is not a relevant person should not act or rely on this document or any of its contents.


         Notice to Prospecti ve Investors in France

               Neither this prospectus supplement nor any other offering material relating to the shares described in this prospectus
         supplement has been submitted to the clearance procedures of the Autorité des Marchés Financiers or of the competent
         authority of another member state of the European Economic Area and notified to the Autorité des Marchés Financiers. The
         shares have not been offered or sold and will not be offered or sold, d irectly or in directly, to the public in France. Neither
         this prospectus supplement nor any other offering material relating to the shares has been or will be:

               • released, issued, distributed or caused to be released, issued or distributed to the public in France; or

               • used in connection with any offer for subscription or sale of the shares to the public in France.


                                                                        S-46
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               Such offers, sales and distributions will be made in France only:

               • to qualified investors ( investisseurs qualifiés ) and/or to a restricted circle of investors ( cercle restreint
                 d’investisseurs ), in each case investing for their o wn account, all as defined in, and in accordance with
                 articles L.411-2, D.411-1, D.411-2, D.734-1, D.744-1, D.754-1 and D.764-1 of the French Code monétaire et
                 financier ;

               • to investment services providers authorized to engage in portfolio management on behalf of third parties; or

               • in a transaction that, in accordance with article L.411-2-II-1°-or-2°-or 3° of the French Code monétaire et financier
                 and article 211-2 of the General Regulat ions ( Règlement Général ) of the Autorité des Marchés Financiers , does
                 not constitute a public offer ( appel public à l’épargne ).

              The shares may be resold directly or indirectly, only in co mpliance with art icles L.411-1, L.411-2, L.412-1 and L.621-8
         through L.621-8-3 of the French Code monétaire et financier .


         Notice to Prospecti ve Investors in Hong Kong

                The shares may not be offered or sold in Hong Kong by means of any document other than (i) in circu mstances which
         do not constitute an offer to the public within the meaning of the Co mpanies Ord inance (Cap. 32, Laws of Hong Kong), or
         (ii) to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong)
         and any rules made thereunder, or (iii) in other circu mstances which do not result in the document being a “prospectus”
         within the mean ing of the Co mpanies Ordinance (Cap. 32, Laws of Hong Kong) and no advertisement, invitation or
         document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each
         case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by,
         the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which
         are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the
         mean ing of the Securit ies and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.


         Notice to Prospecti ve Investors in Japan

             The shares offered in this prospectus supplement have not been registered under the Securities and Exchange Law of
         Japan. The shares have not been offered or sold and will not be offered or sold, d irectly or ind irectly, in Japan or to or for the
         account of any resident of Japan, except (i) pursuant to an exemption fro m the registration requirements of the Securities and
         Exchange Law and (ii) in co mpliance with any other applicable requirements of Japanese law.


         Notice to Prospecti ve Investors in Singapore

               This prospectus supplement has not been registered as a prospectus with the Monetary Authority of Singapore.
         Accordingly, this prospectus supplement and any other document or material in connection with the offer or sale, or
         invitation for subscription or purchase, of the shares may not be circulated or d istributed, nor may the shares be offered or
         sold, or be made the subject of an invitation for subscription or purchase, whether directly o r indirectly, to persons in
         Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of
         Singapore (the “SFA”), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and
         in accordance with the conditions specified in Section 275 of the SFA o r (iii) otherwise pursuant to, and in accordance with
         the conditions of, any other applicable provision of the SFA, in each case subject to compliance with conditions set forth in
         the SFA.


                                                                        S-47
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               Where the shares are subscribed or purchased under Section 275 o f the SFA by a relevant person which is:

               • a corporation (wh ich is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which
                 is to hold investments and the entire share capital of wh ich is owned by one or more individuals, each of who m is an
                 accredited investor; or

               • a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each
                 beneficiary of the trust is an individual who is an accredited investor,

              shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights and interest
         (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired
         the shares pursuant to an offer made under Section 275 of the SFA except:

               • to an institutional investor (for corporations, under Section 274 of the SFA) o r to a relevant person defined in
                 Section 275(2) of the SFA, o r to any person pursuant to an offer that is made on terms that such shares, debentures
                 and units of shares and debentures of that corporation or such rights and interest in that trust are acquired at a
                 consideration of not less than S$200,000 (or its equivalent in a foreign currency) for each transaction, whether such
                 amount is to be paid for in cash or by exchange of securities or other assets, and further for corporations, in
                 accordance with the conditions specified in Section 275 of the SFA;

               • where no consideration is or will be given for the transfer; or

               • where the transfer is by operation of law.


                                                                       S-48
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                                                              LEGAL MATTERS

              The validity of the common stock offered hereby will be passed upon for us by Woodburn and Wedge, Reno, Nevada,
         our Nevada counsel. Certain legal matters in connection with the issuance of the common stock will be passed upon by
         Vinson & Elkins L.L.P., Houston, Texas, as our counsel. Certain legal matters will be passed upon for the underwriters by
         Baker Botts L.L.P., Houston, Texas.


                                                                   EXPERTS

               The consolidated financial statements of Endeavour International Co rporation as of December 31, 2010 and 2009, and
         for each of the years in the three-year period ended December 31, 2010, and management’s assessment of the effect iveness
         of internal control over financial reporting as of December 31, 2010 have been incorporated by reference herein in reliance
         upon the reports of KPM G LLP, independent registered public accounting firm, incorporated by reference herein, and upon
         the authority of said firm as experts in accounting and auditing. KPM G LLP ’s audit report covering the December 31, 2010
         financial statements refers to a change in the reserve estimates and related disclosures as a result of adopting new oil and gas
         reserve estimation and disclosure requirements.

               Certain info rmation included or incorporated by reference in this prospectus regarding estimated quantities of oil and
         gas reserves owned by us is based on estimates of the reserves prepared by or audited by Netherland, Sewell & Associates,
         Inc., independent petroleum engineers, and all such information has been so incorporated in reliance on the authority of that
         firm as experts regarding the matters contained in their report.


                                                                      S-49
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                                            GLOSSARY OF OIL AND NATURAL GAS TERMS

               “Basin.” A large natural depression on the earth’s surface in wh ich sediments accumulate.

              “Bbl.” One stock tank barrel, of 42 U.S. gallons liquid volu me, used herein in reference to crude oil, condensate or
         natural gas liquids.

               “BOE.” Barrels of o il equivalent, with 6,000 cubic feet of natural gas being equivalent to one barrel of oil.

              “British Thermal Unit.” The heat required to raise the temperature of a one-pound mass of water fro m 58.5 to 59.5
         degrees Fahrenheit.

             “Completion.” The process of treating a drilled well followed by the installation of permanent equipment for the
         production of natural gas or oil, or in the case of a dry hole, the reporting of abandonment to the appropriate agency.

               “Developed Reserves.” Reserves of any category that can be expected to be recovered through existing wells with
         existing equip ment and operating methods or for which the cost of required equip ment is relatively minor when co mpared to
         the cost of a new well.

               “Field.” An area consisting of a single reservoir or mu ltip le reservoirs all grouped on, or related to, the same
         individual geological structural feature o r stratigraphic condition. The field name refers to the surface area, although it may
         refer to both the surface and the underground productive formations.

               “Formation.” A layer of rock which has distinct characteristics that differ fro m nearby rock.

             “Horizontal Drilling.” A drilling technique used in certain fo rmations where a well is drilled vertically to a certain
         depth and then drilled at a right angle within a specified interval.

               “MBbl.” One thousand barrels of crude oil, condensate or natural gas liquids.

               “MBOE. ” One thousand barrels of oil equivalent.

               “Mcf.” One thousand cubic feet of natural gas.

               “MMBOE.” One million barrels of o il equivalent.

               “MMBtu.” One million British thermal units.

               “MMcf.” One million cubic feet of natural gas.

             “Net acres.” The percentage of total acres an owner has out of a particular nu mber of acres, or a specified tract. An
         owner who has 50% interest in 100 acres owns 50 net acres.

              “Pilot well.” A well d rilled to find and produce natural gas or oil reserves not classified as proved, to find a new
         reservoir in a field p reviously found to be productive of natural gas or oil in another reservoir or to extend a known reserv oir.

              “Play.” A term applied to a portion of the explorat ion and production cycle follo wing the identification by geologists
         and geophysicists of areas with potential natural gas and oil reserves.

              “Producing Well.” A well that is found to be capable of producing hydrocarbons in sufficient quantities such that
         proceeds fro m the sale of the production exceed production expenses and taxes.

             “Proved Developed Reserves.” Has the meaning given to such term in Release No. 33-8995: Modernization of Oil
         and Gas Reporting , which defines proved reserves as:

                    Proved developed reserves are reserves of any category that can be expected to be recovered:
     (i) through existing wells with existing equipment and operating methods or in which the cost of the required
equipment is relatively minor co mpared to the cost of a new well; and


                                                  G-1
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                         (ii) through installed extraction equip ment and infrastructure operational at the time of the reserve estimate if
                    the extract ion is by means not involving a well.

               Supplemental defin itions fro m the 2007 Petro leu m Resources Management System:

                   Proved Developed Producing Reserves — Developed Producing Reserves are expected to be recovered from
               complet ion intervals that are open and producing at the time of the estimate. Imp roved recovery reserves are considered
               producing only after the improved recovery project is in operation.

                   Proved Developed Non-Producing Reserves — Developed Non-Producing Reserves include shut-in and
               behind-pipe Reserves.

              Shut-in Reserves are expected to be recovered fro m (1) co mp letion intervals wh ich are open at the time of the estimate
         but which have not yet started producing, (2) wells which were shut-in for market conditions or pipeline connections, or
         (3) wells not capable of production for mechanical reasons. Behind -pipe Reserves are expected to be recovered fro m zones
         in existing wells wh ich will require additional co mpletion work or future reco mpletion prior to start of production. In all
         cases, production can be initiated or restored with relatively low expenditure co mpared to the cost of drilling a new
         well.Proved reserves that can be expected to be recovered through existing wells with existing equipment and operat ing
         methods.

             “Proved Reserves.” Has the meaning given to such term in Release No. 33-8995: Modernization of Oil and Gas
         Reporting , which defines proved reserves as:

              Proved reserves are those quantities of oil and natural gas, wh ich, by analysis of geoscience and engineering data, can
         be estimated with reasonable certainty to be economically producible — fro m a g iven date forward, fro m known reservoirs,
         and under existing economic conditions, operating methods, and government regulations — prior to the time at which
         contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of
         whether deterministic or probabilistic methods are used for the estimation. The project to extract the hydrocarbons must have
         commenced or the operator must be reasonably certain that it will co mmence the project within a reasonable time.

               (i) The area of the reservoir considered as proved includes:

                    (A) the area identified by drilling and limited by flu id contacts, if any, and

                    (B) adjacent undrilled port ions of the reservoir that can, with reasonable certainty, be judged to be continuous with
               it and to contain economically producible o il or natural gas on the basis of available geoscience and engineering data.

              (ii) In the absence of data on fluid contacts, proved quantities in a reservoir are limited by the lowest known
         hydrocarbons (“LKH”) as seen in a well penetration unless geoscience, engineering, or performance data and reliable
         technology establishes a lower contact with reasonable certainty.

               (iii) Where d irect observation from well penetrations has defined a highest known oil (“HKO”) elevation and the
         potential exists for an associated natural gas cap, proved oil reserves may be assigned in the structurally h igher portions of
         the reservoir only if geoscience, engineering, or performance data and reliable technology establish the higher contact with
         reasonable certainty.

               (iv) Reserves which can be produced economically through application of improved recovery techniques (including, but
         not limited to, fluid injection) are included in the proved classification when:

                    (A) successful testing by a pilot project in an area of the reservoir with properties no more favorable than in the
               reservoir as a whole, the operation of an installed program in the reservoir or an analogous reservoir, or other evidence
               using reliable technology establishes the reasonable certainty of the engineering analysis on which the project or
               program was based; and

                     (B) the project has been approved for development by all necessary parties and entities, including governmental
               entities.


                                                                          G-2
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               (v) Existing economic conditions include prices and costs at which economic producibility fro m a reservoir is to be
         determined. The price shall be the average price during the 12-month period prior to the ending date of the period covered by
         the report, determined as an unweighted arithmet ic average of the first-day-of-the-month price for each month within such
         period, unless prices are defined by contractual arrangements, exc luding escalations based upon future conditions.

              “Proved Undeveloped Reserves (PUD).” Has the meaning given to such term in Release No. 33-8995: Modernization
         of Oil and Gas Reporting , wh ich defines proved reserves as:

             Proved undeveloped oil and natural gas reserves are reserves of any category that are expected to be recovered from
         new wells on undrilled acreage, or fro m existing wells where a relatively major expenditure is required fo r reco mp letion.

              (i) Reserves on undrilled acreage shall be limited to those directly offsetting development spacing areas that are
         reasonably certain of production when drilled, unless evidence using reliab le technology exists that establishes reasonable
         certainty of economic producibility at greater d istances.

              (ii) Undrilled locations can be classified as having undeveloped reserves only if a develop ment plan has been adopted
         indicating that they are scheduled to be drilled within five years, unless the specific circu mstances, justify a longer t ime.

             “Reserves.” Estimated remaining quantities of oil and natural gas and related substances anticipated to be
         economically producible as of a given date by application of develop ment prospects to known accumulat ions.

              “Reservoir.” A porous and permeable underground formation containing a natural accu mulat ion of producible natural
         gas and/or oil that is confined by impermeable rock or water barriers and is separate from other reservoirs.

             “Shale.” Fine-grained sedimentary rock co mposed mostly of consolidated clay or mud. Shale is the most frequently
         occurring sedimentary rock.

              “Undeveloped Acreage.” Acreage owned or leased on which wells can be drilled or co mpleted to a point that would
         permit the production of commercial quantities of oil and natural gas regardless of whether such acreage contains proved
         reserves.

              “Working Interest.” The right granted to the lessee of a property to explore for and to produce and own oil, gas, or
         other minerals. The working interest owners bear the exp loration, develop ment, and operating costs on either a cash, penalty,
         or carried basis.


                                                                       G-3
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         Prospectus




                                                                $500,000,000

                                                             Debt Securities
                                                             Common Stock
                                                             Preferred Stock
                                                               Warrants

              We may offer and sell the securities listed above fro m time to time in one or mo re offerings in one or more classes or
         series.

               The aggregate initial offering price of the securities that we offer will not exceed $500,000,000.

              This prospectus provides you with a general description of the securities that may be offered. Each t ime securities are
         offered, we will provide a p rospectus supplement and attach it to this prospectus. The prospectus supplement will contain
         more specific information about the offering and the terms of the securities being offered, including any guarantees by our
         subsidiaries. A prospectus supplement may also add, update or change information contained in this prospectus. This
         prospectus may not be used to offer or sell securities without a prospectus supplement describing the method and terms of
         the offering.

               We may sell these securities direct ly or through agents, underwriters or dealers, or through a combination of these
         methods. See “Plan of Distribution.” The prospectus supplement will list any agents, underwriters or dealers that may be
         involved and the compensation they will receive. The prospectus supplement will also show you the total amount of money
         that we will receive fro m selling the securities being offered, after the expenses of the offering. You should carefully read
         this prospectus and any accompanying prospectus supplement, together with the documents we incorporate by reference,
         before you invest in any of our securities.

              Investing in any of our securities invol ves risk. Please read carefully the information included and incorporated
         by reference in this prospectus and in any applicable prospectus supplement for a discussion of the factors you shoul d
         consider before deci di ng to purchase our securities. See “Risk Factors” beginning on page 2 of this prospectus.

              Our co mmon stock is listed on the NYSE A mex under the symbol “END” and on the London Stock Exchange under
         the symbol “ENDV.”

              Neither the Securities and Exchange Commission nor any state securities commis sion has approved or
         disapproved of these securities or determined if this pros pectus is truthful or complete. Any representation to the
         contrary is a cri minal offense.

                                                  The date of this prospectus is February 9, 2010
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              In making your investment decision, you shoul d rely onl y on the information contained or incorporated by
         reference in this pros pectus. We have not authorized anyone to provi de you with any other inf ormati on. If anyone
         provi des you with different or inconsistent information, you shoul d not rely on it.

              You shoul d not assume that the information contained in this pros pectus is accurate as of any date other than
         the date on the front cover of this pros pectus. You shoul d not assume that the information contained in the
         documents incorporated by reference in this pros pectus is accurate as of any date other than the respecti ve dates of
         those documents. Our business, financial condi tion, results of operations and pros pects may have changed since those
         dates.


                                                            Table of Contents


                                                                                                                           Page


         About This Prospectus                                                                                               1
         The Co mpany                                                                                                        1
         Risk Factors                                                                                                        2
         Cautionary Statement Concerning Forward -Looking Statements                                                        16
         Use of Proceeds                                                                                                    17
         Ratio of Earn ings to Fixed Charges and Earnings to Fixed Charges and Preference Securities Dividends              18
         Description of Debt Securit ies                                                                                    19
         Description of Capital Stock                                                                                       29
         Description of Warrants                                                                                            34
         Plan of Distribution                                                                                               35
         Legal Matters                                                                                                      37
         Experts                                                                                                            37
         Where You Can Find More In formation                                                                               37
         Incorporation of Certain Documents by Reference                                                                    37
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                                                              About This Pros pectus

               This prospectus is a part of a registration statement that we filed with the Securities and Exchange Co mmission, or
         SEC, using a “shelf” registration or continuous offering process. Using this process, we may offer any co mbination of the
         securities described in this prospectus in one or more offerings with a total init ial offering price of up to $500,000,000. In
         this prospectus (including the documents incorporated by reference), we have summarized material provisions of contracts
         and other documents, which are included as exhibits to the registration statement. For a co mplete description of their terms,
         you should review the full text of the documents.

              This prospectus provides you with a general description of the securities we may offer. Each t ime we use this
         prospectus to offer securities, we will prov ide you with a prospectus supplement containing specific in formation about the
         terms of the securities being offered. That prospectus supplement may include additional risk factors or other considerations
         applicable to that offering. A prospectus supplement may also add, update or change information in this prospectus. If there
         is any inconsistency between the informat ion in this prospectus and any prospectus supplement, you should rely on the
         informat ion in the prospectus supplement. You should read both this prospectus and any prospectus supplement together
         with the additional information described under the heading “Where You Can Find More In formation.”

              You should rely only on the info rmation contained in or incorporated by reference in this prospectus or a prospectus
         supplement. We have not authorized any person to give any information or to make any representations not contained or
         incorporated by reference in this prospectus. This prospectus is neither an offer to sell nor a solicitat ion of an offer to b uy
         securities where an offer or solicitation would be unlawful. You should not assu me the information in th is prospectus or a
         prospectus supplement is accurate as of any date other than the date on the front of the documents.

             Except as otherwise set forth in this prospectus, “the Company,” “we,” “our,” and “us” refer to Endeavour International
         Corporation and its consolidated subsidiaries.


                                                                   The Company

             We are an international o il and gas explorat ion and production company focused on the acquisition, exp loration,
         development and production of energy reserves in the North Sea and United States.

             Endeavour International Corporation is a Nevada corporation. Our principal executive o ffices are located at 1001
         Fannin Street, Suite 1600, Houston, Texas 77002, and our telephone number is (713) 307-8700. Our website is
         www.endeavourcorp.com . The information on our website is not part of this prospectus.


                                                                          1
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                                                                   Risk Factors

              You should carefully consider each of the following risks and all of the information set forth in this prospectus and in
         the documents we incorporate by reference before deciding to invest in any of our securities. If any of the fo llo wing risks
         and uncertainties develop into actual events, our business, financial condition, results of operations or cash flows could be
         materially adversely affected. In that case, the trading price of ou r co mmon stock or value of our other securities could
         decline and you may lose all or part of your investment.


         Risks Related to Our Business

            The recent worldwide financial and credit crisis could lead to an extended worldwide economic recession and have a
            material adverse effect on our results of operations and liquidity, which could hinder or prevent us from meeting our
            future capital needs.

               The recent world wide financial and cred it crisis has reduced the availability of liquidity and credit to fund the
         continuation and expansion of industrial business operations worldwide. The shortage of liquidity and credit co mb ined with
         recent substantial losses in worldwide equity markets could lead to an extended worldwide economic recession. A recession
         or slowdown in econo mic activity would likely reduce worldwide demand for energy and result in lower oil and gas prices,
         which could materially adversely affect our profitability and results of operations and ability to obtain funding for our
         projects, including the development of our North Sea discoveries: Rochelle, Co lu mbus and Cygnus.

              In addition, we may be unable to obtain adequate funding under our current senior bank facility because (i) our lending
         counterparties may be unwilling or unable to meet their funding obligations or (ii) our borrowing base under our current
         senior bank facility is redetermined at least twice per year and was reduced twice in 2009 as a result of lower oil or gas
         prices, declines in reserves and lending requirements or regulations.

              Due to these factors, we cannot be certain that funding will be availab le if needed, and to the extent required, on
         acceptable terms or at all. If funding is not available as needed, or is available only on unfavorable terms, we may be unable
         to meet our obligations as they come due, or we may be unable to implement our cap ital program, enhance our existing
         business, complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures,
         any of which could have a material adverse effect on our production, revenues and results of operations.


            Oil and gas prices are volatile, and a decline in oil and gas prices would reduce our revenues, profitability and cash
            flow and impede our growth.

               Our revenues, profitability and cash flow depend substantially upon the prices and demand for o il and gas. The markets
         for these commodities are volatile, and even relat ively modest drops in prices can significantly affect our financial results
         and impede our growth. Oil and gas prices increased to, and then declined significantly fro m, historical highs in 2008 and
         may fluctuate and decline significantly in the near future. Prices for oil and gas fluctuate in response to relatively minor
         changes in the supply and demand for oil and gas, market uncertainty and a variety of addit ional factors beyond our control,
         such as:

               • global supply of oil and gas;

               • level of consumer product demand;

               • technological advances affecting oil and gas consumption;

               • global economic conditions;

               • price and availability of alternative fuels;

               • actions of the Organization of Petroleu m Export ing Countries and other state-controlled oil co mpanies relat ing to oil
                 price and production controls;

               • governmental regulations and taxat ion;
2
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               • political conditions in or affecting other oil-producing and gas-producing countries;

               • weather conditions;

               • the proximity, capacity, cost and availability of p ipelines and other transportation facilities; and

               • the impact of energy conservation efforts.

               Lower o il and gas prices may not only decrease our revenues on a per unit basis, but significant or extended price
         declines may also reduce the amount of oil and gas that we can produce economically. A reduction in production could result
         in a shortfall in expected cash flows and require us to reduce capital spending or borrow funds to cover any such shortfall.
         Any of these factors could negatively impact our ability to rep lace our production and our future rate of growth.

              In addition, we may, fro m time to time, enter into long-term contracts based upon our reasoned expectations for
         commodity price levels. If co mmodity prices subsequently decrease significantly for a sustained period, we may be unable to
         perform our obligations or otherwise breach the contract and be liable fo r damages.


            Our exploration and development activities may not be commercially successful.

               Exp lorat ion activities involve numerous risks, including the risk that no commercially productive oil or gas reservoirs
         will be discovered. In addition, the future cost and timing of drilling, co mplet ing and producing wells is often uncertain.
         Furthermore, drilling operations may be curtailed, delayed or canceled as a result of a variety of factors, including:

               • unexpected drilling conditions;

               • pressure or irregularities in format ions;

               • equipment failu res or accidents;

               • adverse weather conditions;

               • compliance with governmental regulations;

               • unavailability or h igh cost of drilling rigs, equip ment or labor;

               • lack of co-participant support;

               • reductions in oil and gas prices; and

               • limitat ions in the market for oil and gas.

              If any of these factors were to occur with respect to a particular pro ject, we could lose all or a part of our investment in
         the project, or we could fail to realize the expected benefits fro m the project, either of which could materially and adverse ly
         affect our revenues and profitability.


            To maintain and grow our production and cash flow, we must continue to develop and produce existing reserves and
            discover or acquire new oil and gas reserves to develop and produce.

              Our future oil and gas production is highly dependent upon our level of success in finding or acquiring additional
         reserves. Producing oil and gas reserves are generally characterized by declin ing production rates that vary depending on
         reservoir characteristics and other factors. Our reserves will decline unless we acquire properties with proved reserves or
         conduct successful development and exp loration drilling activities. We acco mplish this through successful drilling programs
         and the acquisition of properties. However, we may be unable to find, develop or acquire additional reserves or production at
         an acceptable cost or at all. If we are unable to find, develop or acquire additional reserves to replace our current and fut ure
         production, our production rates will decline even if we drill the undeveloped locations that were included in our estimated
         proved reserves. Our future oil and gas reserves and production, and therefore our cash flow and income, are
3
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         dependent on our success in economically finding or acquiring new reserves and efficiently developing our existing reserves.


            Our development and exploration operations, including our recent North Sea discoveries, require substantial capital,
            and we may be unable to obtain needed capital or financing on satisfactory terms, w hich could lead to a loss of
            properties and a decline in our oil and gas reserves.

              The oil and gas industry is capital intensive. We make and expect to continue to make substantial capital expenditures
         in our business and operations for the explorat ion, development, production and acquisition of oil and gas reserves, including
         expenditures relating to the development of our discoveries in the North Sea and our acreage position in the Haynesville
         Shale and other U.S. p lays. We intend to finance our future capital expenditures primarily with cash flow fro m opera tions
         and borrowings under our revolving credit facility. Our cash flo w fro m operations and access to capital is subject to a
         number of variab les, including:

               • our proved reserves;

               • the level of natural gas and crude oil we are ab le to produce fro m existing wells;

               • the prices at which natural gas and crude oil are sold; and

               • our ability to acquire, locate and produce new reserves.

              If our revenues decrease as a result of lower o il and gas prices, operating difficu lties, declines in reserves or for any
         other reason, we may have limited ability to obtain the capital necessary to sustain our operations at current levels or to
         further develop and exp loit our current properties, or for exp loratory activity. In order to fund our capital expenditures, we
         may need to seek additional financing. Our credit agreements contain covenants restricting our ability to incur additional
         indebtedness without the consent of the lenders. Our lenders may withhold this consent in their sole discretion. In addition, if
         our borrowing base is redetermined resulting in a lower borrowing base under our revolving credit facility, we may be
         unable to obtain financing otherwise available under our revolving cred it facility.

               Furthermore, we may not be able to obtain debt or equity financing on terms favorable to us, or at all. In part icular, the
         cost of raising money in the debt and equity capital markets has increased substantially wh ile the availability of funds fro m
         those markets generally has diminished significantly. Also, as a result of concerns about the stability of financial markets
         generally and the solvency of counterparties specifically, the cost of obtaining mo ney fro m the credit markets generally has
         increased as many lenders and institutional investors have increased interest rates, enacted tighter lending standards, refus ed
         to refinance existing debt at maturity on terms that are similar to existing debt, and reduced, or in some cases ceased, to
         provide funding to borrowers. The failure to obtain additional financing could result in a curtailment of our operations
         relating to exp loration and development of our prospects, which in turn could lead to a possible loss of properties and a
         decline in our natural gas, crude oil and natural gas liquids reserves.


            We may be unable to make attractive acquisitions, and any acquisition we complete is subject to substantial risks that
            could impact our business.

               As part of our growth strategy, we intend to pursue strategic acquisitions of new properties or businesses that expand
         our current asset base and potentially offer unexploited reserve potential. Our gro wth strategy following the full developmen t
         of our existing properties could be impeded if we are unable to acquire addit ional interests in oil and gas prospects on a
         profitable basis. Acquisition opportunities in the oil and gas industry are very competitive, wh ich can increase the cost of, or
         cause us to refrain fro m, co mp leting acquisitions. The success of any acquisition will depend on a number of factors and
         involves potential risks, including among other things:

               • the inability to estimate accurately the costs to develop the interests in oil and gas prospects, the recoverable
                 volumes of reserves, rates of future production and future net cash flows attainable fro m the reserves;


                                                                         4
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               • the assumption of unknown liabilit ies, losses or costs for which we are not indemn ified or for which the indemnity
                 we receive is inadequate;

               • the validity of assumptions about costs, including synergies;

               • the impact on our liqu idity or financial leverage of using available cash or debt to finance acquisitions;

               • the diversion of management’s attention from other business concerns; and

               • an inability to hire, train or retain qualified personnel to manage and operate our growing business and assets.

              All of these factors affect whether an acquisition will ult imately generate cash flows sufficient to provide a suitable
         return on investment. Even though we perform a review of the properties we seek to acquire that we believe is consistent
         with industry practices, such reviews are often limited in scope. As a result, among other risks, our init ial estimates of
         reserves may be subject to revision following an acquisition, wh ich may materially and adversely impact the desired benefits
         of the acquisition.


            We have recently commenced exploration, production and development operations in the United States, and as a result,
            our ability to successfully achieve our goals is subject to greater risk and uncertainty.

               In 2008, we began to pursue explo ration, production and development activities in the Un ited States. Because we have
         limited production history in this geographic region, we are less able to use past operational results to help predict future
         results. Our lack of operational experience in the United States may result in our not being able to fu lly execute our expected
         drilling programs in this region, and the return on investment fro m our Un ited States operations may not be as attractive as
         expected. We cannot assure you that our efforts in the United States will be successful, or if successful will ach ieve the
         resource potential levels that we currently anticipate or ach ieve the anticipated economic returns based on our current
         financial models.


            Our debt level could negatively impact our financial condition, results of operations and business prospects.

             As of September 30, 2009, we had $178.2 million in outstanding indebtedness. Our level of indebtedness could have
         important consequences on our operations, including:

               • placing restrictions on certain operating activities;

               • making it mo re difficult for us to satisfy our obligations under our indentures or the terms of our other debt
                 instruments and increasing the risk that we may default on our debt obligations;

               • requiring us to dedicate a substantial portion of our cash flow fro m operating activit ies to required payments on
                 debt, thereby reducing the availability of cash flow for working capital, capital expenditures and other general
                 business activities;

               • limit ing our ability to obtain additional financing in the future for working capital, cap ital expenditures, acquisitions
                 and other general business activities;

               • decreasing our ability to withstand a downturn in our business or the economy generally; and

               • placing us at a competitive d isadvantage against other less leveraged competitors.

               We may not have sufficient funds to repay our outstanding debt. If we are unable to repay our debt out of cash on hand,
         we could attempt to refinance such debt, sell assets or repay such debt with the proceeds from an equity offering. In addit io n,
         we cannot assure you that we will be able to generate sufficient cash flow fro m operating activities to pay the interest on our
         debt or that future borrowings, equity financings or proceeds from the sale of assets will be availab le to repay or refinance
         such debt. Factors that will affect our ab ility to raise cash through an offering of our capital stock, a refinancing of our debt
         or a sale of assets include financial market conditions, our market value, our reserve levels and our operating performance a t
         the time of such offering or other financing. We cannot assure you that any such offering, refinancing or sale of assets can
5
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         be successfully comp leted. The inability to repay or refinance our debt, could have a material adverse effect on our
         operations and negatively impact our capital program.


            We will not be the operator of all of the interests we own or acquire, and therefore we may not be in a position to
            control the timing of development efforts, the associated costs, or the rate of production of the reserves in respect of
            such interests.

              A significant number of our interests, including all of our producing fields, are cu rrently operated by third parties. As a
         result, we may have limited ability to exercise influence over the operations of these interests or their associated costs.
         Dependence on the operator and other working interest owners for these projects, and limited ability to influence operations
         and associated costs could prevent the realizat ion of expected returns on capital in drilling or acquisition activ ities. The
         success and timing of development and explo itation activities on properties operated by others dep end upon a number of
         factors that will be largely outside our control, including:

               • the operator’s expertise and financial resources;

               • the timing and amount of their capital expenditures;

               • the rate of production of the reserves;

               • approval of other participants to drill wells and imp lement other work programs;

               • the availability of suitable drilling rigs, drilling equip ment, support vessels, production and transportation
                 infrastructure and qualified operating personnel; and

               • selection of technology.

             Our inability to control the development efforts, costs and timing on the interests where we are not the operator could
         have a material adverse effect on our financial conditions, results of operations and business prospects.


            Variable rate indebtedness subjects us to interest rate risk, w hich could cause our debt service obligations to increase
            significantly.

              Our Secured Revolv ing Loan and a Letter of Credit Facility Agreement (together, the “Debt Agreements”) provide for
         certain borrowings at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service
         obligations on the variable rate indebtedness would increase even though the amount borrowed would remain the same, and
         consequently our net income would decrease.


            Competition for oil and gas properties and prospects is intense and some of o ur competitors have larger financial,
            technical and personnel resources that give them an advantage in evaluating, obtaining and developing properties and
            prospects.

               We operate in a highly co mpetitive environment for rev iewing prospects, acquiring properties, marketing oil and gas
         and securing trained personnel. Many of our competitors are major o r independent oil and gas companies that have longer
         operating histories in our areas of operation and employ superior financial resources which allow them to obtain
         substantially greater technical and personnel resources and which better enable them to acquire and develop the prospects
         that they have identified. We also actively co mpete with other companies when acquiring new licenses or oil and gas
         properties. Our relatively small size could adversely affect our ab ility to obtain new prospects and opportunities.
         Specifically, co mpetitors with greater resources than our own hav e certain advantages that are particularly important in
         reviewing prospects and purchasing properties. Co mpetitors may be able to evaluate, bid for and purchase a greater number
         of properties and prospects than our financial or personnel resources permit. Co mpetitors may also be able to pay more for
         producing oil and gas properties and exp loratory prospects than we are able or willing to pay. If we are unable to compete
         successfully in these areas in the future, our future revenues and growth may be diminis hed or restricted.


                                                                          6
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               These competitors may also be better able to withstand sustained periods of unsuccessful drilling or downturns in the
         economy, including decreases in the price of commodities as experienced in 2008 and 2009. Larger competitors may also be
         able to absorb the burden of any changes in laws and regulations more easily than we can, wh ich would also adversely affect
         our competitive position. In addition, most of our co mpetitors have been operating for a much longer time and have
         demonstrated the ability to operate through industry cycles.

            Market conditions or transportation impediments may hinder our access to oil and gas markets or delay our
            production.

               Market conditions, the unavailability of satisfactory oil and gas transportation or the remote location of our drilling
         operations may hinder our access to oil and gas markets or delay our production. The availability of a ready market for our
         oil and gas production depends on a number of factors, including the demand for and supply of oil and gas and the proxi mity
         of reserves to pipelines or trucking and terminal facilities. In offshore operations, the availability of a ready market depe nds
         on the proximity of, and our ability to tie into in so me cases, existing production infrastructure or commercially viable terms.
         We may be required to shut in wells or delay init ial p roduction for lack of a market or because of inadequacy or
         unavailability of p ipeline or gathering system capacity. When that occurs, we are unable to realize revenue fro m those wells
         until the production can be tied to a gathering system. Th is can result in considerable delays fro m the in itial d iscovery of a
         reservoir to the actual production of the oil and gas and realization of revenues.

            We have limited control over the availability or cost of drilling rigs and other equipment and services which are
            essential to our operations.

               We have limited control over the availab ility and cost of drilling rigs and other services and equipment which are
         necessary for us to carry out our explorat ion and development activities. Increased drilling activ ity periodically results in
         service cost increases and shortages in drilling rigs, personnel, equipment and supplies in certain areas. Procuring a sufficient
         number of drilling rigs can be expensive and difficu lt as the market for such rigs is highly co mpetitive. There is no assuran ce
         that we will be ab le to contract for such services or equipment on a timely basis or that the cost of such services and
         equipment will remain at a satisfactory or affo rdable level. Shortages or the high cost of drilling rigs, equip ment, supplies or
         personnel could delay or adversely affect our exp lorat ion and development operations, which could have a material adverse
         effect on business, financial condition or results of operations. We also rely (and expect to rely in the future) on facilities
         developed and owned by third parties in order to store, process, transmit and sell our oil and gas production. Our p lans to
         develop and sell our o il and gas reserves could be materially and adversely affected by the inability or unwillingness of third
         parties to provide sufficient trans mission, storage or processing facilities to us.

            Lower oil and gas prices and other factors resulted in a ceiling test write-down and may in the future result in
            additional ceiling test write-downs or other impairments.

              We capitalize the costs to acquire, find and develop our oil and gas properties under the full cost accounting method.
         The net capitalized costs of our oil and gas properties may not exceed the present value of estimated future net cash flows
         fro m proved reserves, using period-end oil and gas prices and a 10% d iscount factor, plus the lower of cost or fair market
         value for unproved properties. If net capitalized costs of our oil and gas properties exceed this limit, we must charge the
         amount of the excess to earnings. This is called a “ceiling test write-down.” A lthough a ceiling test write-down does not
         impact cash flow fro m operating activities, it does reduce net income and our shareholders ’ equity. Once recorded, a ceiling
         test write-down is not reversible at a later date even if oil and gas prices increase.

              We review the net capitalized costs of our properties quarterly, based on prices in effect (excluding the effect of our
         hedging contracts that are not designated for hedge accounting) as of the end of each quarter or as of the time of reporting
         our results. The net capitalized costs of oil and gas properties are computed on a country -by-country basis. Therefore, wh ile
         our properties in one country may be subject to a write-down, our properties in other countries could be unaffected . We also
         assess investments in unproved properties periodically to determine whether impairment has occurred.


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               The risk that we will be required to further write down the carrying value of our oil and gas properties increases when
         oil and gas prices are low or volatile. In addition, write-downs may occur if we experience substantial downward
         adjustments to our estimated proved reserves or our unproved property values, or if estimated future development costs
         increase. We may experience further ceiling test write-downs or other impairments in the future. In addit ion, any future
         ceiling test cushion would be subject to fluctuation as a result of acquisition or divestiture activity.


            Approximately 47% of our total estimated proved reserves at December 31, 2008 were proved undeveloped reserves.

               Recovery of proved undeveloped reserves requires significant capital expen ditures and successful drilling operations.
         The reserve data included in the reserve engineer reports assumes that substantial capital expenditures are required to
         develop such reserves. Although cost and reserve estimates attributable to our natural gas a nd crude oil reserves have been
         prepared in accordance with industry standards, we cannot be sure that the estimated costs are accurate, that development
         will occur as scheduled or that the results of such development will be as estimated.


            The present value of fut ure net cash flows from our proved reserves will not necessarily be the same as the current
            market value of our estimated oil and gas reserves.

              You should not assume that the present value of future net revenues from our proved reserves referred to in this
         prospectus is the current market value of our estimated oil and gas, crude oil and natural gas liquids reserves. In accordanc e
         with the require ments of the SEC, the estimated discounted future net cash flows fro m our proved reserves are based on
         prices and costs on the date of the estimate, held flat for the life of the properties. Actual future prices and costs may differ
         materially fro m those used in the present value estimate. The present value of future net revenues fro m our proved reserves
         as of December 31, 2008 for gas was based on: (i) a Houston Ship Channel spot market price o f $5.24 per MMbtu for our
         United States properties and (ii) Nat ional Balancing Point spot market price of $8.70 per MMbtu for our Norwegian and
         United Kingdom propert ies. The present value of future net revenues from our proved reserves as of December 31, 2008 for
         oil was based on: (i) a West Texas Intermed iate posted price of $41.00 per barrel for our United States properties and (ii) a
         Dated Brent posted price of $36.55 per barrel for our Norwegian and Un ited Kingdom properties.

               Actual future net cash flows will also be affected by increases or decreases in consumption by oil and gas purchasers
         and changes in governmental regulations or taxation. The timing of both the production and the incurrence of expenses in
         connection with the development and production of oil and gas properties affects the timing of actual future net cash flows
         fro m proved reserves. In addition, the 10% d iscount factor, wh ich is required by the SEC to be used in calculating
         discounted future net cash flows for reporting purposes, is not necessarily the most appropriate discount factor. The effective
         interest rate at various times and the risks associated with our business or the oil and gas industry in general will affect the
         accuracy of the 10% discount factor.


            Our estimates of proved reserves and related PV-10 and standardized measure of discounted future net cash flows,
            which are prepared and presented under existing SEC rules, may change materially as a result of new SEC rules that
            will go into effect for fiscal years ending on or after December 31, 2009.

              This prospectus presents estimates of our proved reserves and related PV-10 and standardized measure of discounted
         future net cash flows as of December 31, 2008, which estimates have been prepared and presented under existing SEC rules.
         The SEC has adopted new rules that are effective for fiscal years ending on or after December 31, 2009, which will require
         SEC reporting co mpanies to prepare their reserves estimates using revised reserve definitions and revised pricing based on
         12-month unweighted first-day-of-the-month average pricing. The pricing to be utilized for estimates of our gas reserves as
         of December 31, 2009 will be based on an unweighted average twelve month and is anticipated to be (i) Henry Hub spot
         price of $3.86 per MM Btu for our Un ited States properties and (ii) National Balancing Po int spot market price of $4.96 per
         MMbtu for our Norweg ian and United Kingdom properties. The pricing to be utilized for estimates of our oil reserves as of
         December 31, 2009 will be based on an unweighted average twelve month and is anticipated to be (i) West


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         Texas Intermediate posted price of $61.08 per barrel for our United States properties and (ii) Dated Brent posted price of
         $60.40 per barrel for our Un ited Kingdom properties.

              Another impact of the new SEC rules is a general requirement that, subject to limited exceptions, proved undeveloped
         reserves may only be booked if they relate to wells where development activ ities commence within five years of the date of
         booking. This new ru le may limit our potential to book additional p roved undeveloped reserves as we pursue our drilling
         program.

              The SEC has released only limited interpretive guidance regarding report ing of reserve estimates under the new rules
         and may not issue further interpretive guidance on the new rules prior to the end of 2009. We have not determined the
         impact the new ru les may have on our estimates of our proved reserves and related PV-10 and standardized measure of
         discounted future net cash flows as of December 31, 2009 or as of September 30, 2009, but the impact of the new rules on
         such estimates, and in particular the estimates of proved undeveloped reserves, could be material.


            Reserve estimates depend on many assumptions that may turn out to be inaccurate and any material inaccuracies in
            the reserve estimates or underlying assumptions of our assets will materially affect the quantities and present value of
            those reserves.

              Estimating o il and gas reserves is complex and inherently imprecise. It requires interpretation of the availab le technical
         data and making many assumptions about future conditions, including price and other economic factors. In preparing such
         estimates, projection of production rates, timing of development expenditures and available geological, geophysical,
         production and engineering data are analyzed. The extent, quality and reliab ility of these data can vary. This process also
         requires economic assumptions about matters such as oil and gas prices, drilling and operating expenses, capital
         expenditures, taxes and availability of funds. If our interpretations or assumptions used in arriving at our reserve estimate s
         prove to be inaccurate, the amount of oil and gas that will ult imately be recovered may d iffer materially fro m the estimated
         quantities and net present value of reserves owned by us.


            Actual production could differ significantly from forecasts.

               Fro m t ime to time we provide fo recasts of expected quantities of future oil and gas production. These forecasts are
         based on a number of estimates, includ ing expectations of production decline rates fro m existing wells and the outcome of
         future drilling activity. Should these estimates prove inaccurate, actual production could be adversely impacted. Do wnturns
         in co mmodity prices could make certain drilling activities or production uneconomical, which would also adversely impact
         production. In addition, we may ad just estimates of proved reserves to reflect production history, results of explorat ion and
         development, prevailing oil and gas prices and other factors, many of which are beyond our control.


            Our financial results could be adversely affected by goodwill impairments.

               As a result of mergers, acquisitions and dispositions, at September 30, 2009 we had $221.9 million of goodwill on our
         balance sheet. Goodwill is not amortized, but instead must be tested at least annually for impairment by applying a
         fair-value-based test. Goodwill is deemed impaired to the extent that its carrying amount exceeds the fair value of the
         reporting unit. Although our latest tests indicate that no goodwill impairment is currently required, future deterioration in
         market conditions could lead to goodwill impairments that could have a substantial negative effect on our profitability.


            Our expectations for future drilling activities will be realized over several years, making them susceptible to
            uncertainties that could materially alter the occurrence or timing.

               We have identified drilling locations and prospects for future drilling opportunities, including development, exploratory
         and other drilling and enhanced recovery activities. These drilling locations and prospects represent a significant part of o ur
         future drilling plans. Our ability to drill and develop these locations depends on a number of factors, including the
         availability of capital, seasonal conditions, third-party operators, regulatory approvals, negotiation of agreements with third
         parties, commod ity prices, costs and drilling results.


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         Because of these uncertainties, we cannot give any assurance as to the timing of these activities or that they will u ltimately
         result in the realization of proved reserves or meet our expectations for success. As such, our actual drilling and enhanced
         recovery activities may materially d iffer fro m our current expectations, which could have a significant adverse effect on our
         financial condition and results of operations.


            Our use o f derivative transactions may limit future revenues from price increases and involves the risk that our
            counterparties may be unable to satisfy their obligations to us.

              To manage our exposure to price or interest rate risk with our production, we routinely enter into commodity derivat ive
         contracts. The goal of these derivative contracts is to limit volatility and increase the predictability of cash flow. Althou gh
         the use of derivative contracts limits the downside risk of price declines, their use also may limit future revenues fro m pr ice
         increases. In addition, derivative contracts may expose us to the risk of financial loss in certain circu mstances, including
         instances in which our production is less than expected or a sudden, unexpected event materially impacts oil or gas prices.

               Derivative contracts also involve the risk that counterparties, which generally are financial institutions, may be unable
         to satisfy their obligations to us. If any of our counterparties were to default on its obligations to us under the derivativ e
         contracts or seek bankruptcy protection it could have a material adverse effect on our ability to fund our planned activities
         and could result in a larger percentage of our future production being subject to commodity price changes. In addition, in th e
         current economic environment and tight financial markets, the risk of a counterparty default is heightened and it is possible
         that fewer counterparties will participate in future derivative transactions, which could result in greater concentration of our
         exposure to any one counterparty or a larger percentage of our future production being subject to commodity price changes.


            A change of control may adversely affect our liquidity and require refinancing of certain debt instruments.

              At September 30, 2009, we had $48.5 million outstanding under our Debt Agreements. Upon specified change of
         control events, each lender under the Debt Agreements may cancel the facility and declare outstanding loans, plus accrued
         and unpaid interest, outstanding letters of credit and other outstanding fees, if any, due and payable. Additionally we have
         outstanding $81.25 million of 6.0% convertible senior notes due 2012. Upon specified change of control events, each holder
         of those notes may require us to purchase all or a portion of the h older’s notes at a price equal to 100% of the principal
         amount, plus accrued and unpaid interest, if any, up to but excluding the date of purchase, plus in certain circu mstances, a
         makewhole premiu m.

              We also had $48.4 million of 11.5% guaranteed convertible bonds due 2014 outstanding at September 30, 2009, and in
         November 2009, we issued $50.0 million of 12.0% senior subordinated notes due 2014. If we undergo a change of control,
         as defined by the respective note agreements, the holders of these bonds also have the right, subject to certain conditions, to
         redeem the bonds and accrued interest. We cannot assure you we would have sufficient financial resources to purchase the
         notes for cash or repay the lenders under our Debt Agreements upon the occurrence o f a change of control. If a change of
         control occurs, we may be required to refinance our indebtedness. There can be no assurance that we would be able to
         refinance our indebtedness or, if a refinancing were to occur, that the refinancing would be on terms favorable to us.


            The adoption of derivatives legislation by the U.S. Congress could have an adverse impact on our ability to hedge risks
            associated with our business.

              Several proposals for derivative reform have been developed by committees across bot h the U.S. House of
         Representatives and the U.S. Senate. These proposals are focused on expanding Federal regulation surrounding the use of
         financial derivative instruments, including credit default swaps, co mmodity derivatives and other over-the-counter
         derivatives. Among the reco mmendations included in the proposals are the requirements for centralized clearing or settling
         of such derivatives as well as the expansion of collateral marg in requirements for certain derivative -market participants.
         Depending on the ultimate form o f legislation, our derivatives utilization could be adversely affected with (i) greater
         administrative burden, (ii) limitat ions on the form and use of derivatives, and (iii) expanded collateral marg in requirements.


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               Although it is not possible at this time to predict when the U.S. Congress may act on derivatives legislat ion, any laws or
         regulations that may be adopted that subject us to additional collateral marg in requirements relating to, or addit ional
         restrictions on, our trading and commodity positions could have an adverse effect on the cost of our hedging activity.


            Our exploratory drilling projects are based in part on seismic data, which cannot ensure the commercial success of the
            project.

              Our decisions to purchase, exp lore, develop and exp loit prospects or properties depend in part on data obtained through
         geophysical and geological analyses, production data and engineering studies, the results of which are often uncertain. Even
         when used and properly interpreted, seismic data and visualization techniques only assist geoscientists and geologists in
         identifying subsurface structures and hydrocarbon indicators. Seis mic data do not enable an interpreter to conclusively
         determine whether hydrocarbons are present or producible economically. In addit ion, the use of seismic and other advanced
         technologies may require greater predrilling expenditures than other drilling strategies. Because of these factors, we could
         incur losses as a result of exploratory drilling expenditures. Poor results fro m explorat ion activities could have a material
         adverse effect on our future cash flows, ability to replace reserves and results of operations.


            Our offshore operations involve special risks that could increase our cost of operations and adversely affect our ability
            to produce oil and gas.

               Offshore operations are subject to a variety of operating risks specific to the marine environ ment, such as capsizing,
         collisions and damage or loss from hurricanes or other adverse weather conditions. These conditions can cause substantial
         damage to facilities and interrupt production. As a result, we could incur substantial liab ilities that could reduce or eliminate
         the funds available for exp loration, develop ment or leasehold acquisitions, or result in loss of equipment and properties.

               Offshore drilling in the North Sea generally requires mo re time and more advanced drilling technologies, involving a
         higher risk of technological failure and usually higher drilling costs. Moreover, offshore projects often lack pro ximity to t he
         physical and oilfield service infrastructure, necessitating significant capital investment in subsea flow line infrastructure.
         Subsea tieback production systems require substantial time and the use of advanced and very sophisticated installation
         equipment supported by remotely operated vehicles. These operations may enco unter mechanical difficult ies and equipment
         failures that could result in significant cost overruns. As a result, a significant amount of time and capital must be invest ed
         before we can market the associated oil or gas, increasing both the financial and op erational risk involved with these
         operations. Because of the lack and high cost of infrastructure, some offshore reserve discoveries may never be produced
         economically.


            We operate internationally and are subject to political, economic and other uncertai nties.

              We currently have operations in the United States, United Kingdom and the Netherlands. We may expand our
         operations to other countries or regions. International operations are subject to political, economic and other uncertainties ,
         including:

               • the risk of war, acts of terroris m, revolution, border disputes, expropriat ion, renegotiation or modificat ion of existing
                 contracts, and import, export and transportation regulations and tariffs;

               • taxat ion policies, includ ing royalty and tax increases and retroactive tax claims;

               • exchange controls, currency fluctuations and other uncertainties arising out of foreign government sovereignty over
                 our international operations;

               • laws and policies of the U.S. affecting foreign trade, taxat ion and investment; and

               • the possibility of being subject to the exclusive jurisdiction of foreign courts in connection with legal d isputes and
                 the possible inability to subject foreign persons to the jurisdiction of courts in the United States.


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               The exploration, p roduction and sale of oil and gas are extensively regulated by governmental bodies. Applicable
         legislation is under constant review for amend ment or expansion. These efforts frequently result in an increase in the
         regulatory burden on companies in our industry and consequently an increase in the cost of doing business and decrease in
         profitability. Nu merous governmental depart ments and agencies are authorized to, and have, issued rules and regulations
         imposing additional burdens on the oil and gas industry that often are costly to comply with and carry substantial penalties
         for failure to co mply. Production operations are affected by changing tax and other laws relating to the petroleum industry,
         by constantly changing administrative regulations and possible interruptions or termination by government authorities.

               Oil and gas mineral rights may be held by individuals, corporations or governments having jurisdiction over the area in
         which such mineral rights are located. As a general rule, parties holding such mineral rights grant licenses or leases to third
         parties to facilitate the explorat ion and development of these minera l rights. The terms of the leases and licenses are
         generally established to require timely development. Notwithstanding the ownership of mineral rights, the government of the
         jurisdiction in wh ich mineral rights are located generally retains authority over the manner of development of those rights.


            Our insurance may not protect us against business and operating risks, including an operator of a prospect in which
            we participate failing to maintain or obtain adequate insurance.

               Oil and gas operations are subject to particular hazards incident to the drilling and production of oil and gas, such as
         blowouts, cratering, exp losions, uncontrollable flows of o il, gas or well fluids, fires and pollution and other environmental
         risks. These hazards can cause personal in jury and loss of life, severe damage to and destruction of property and equipment,
         pollution or environ mental damage and suspension of operations. We maintain insurance for some, but not all, of the
         potential risks and liabilit ies associated with our business. If a significant accident or other event resulting in damage to our
         operations, including severe weather, terrorist acts, war, civil disturbances, pollution or environmental damage, occurs and is
         not fully covered by insurance, it could adversely affect our financial condition and results of operations. We do not
         currently operate all of our o il and gas properties. In the projects in which we own non -operating interests, the operator may
         maintain insurance of various types to cover our operations with policy limits and retention liability customary in the
         industry. The occurrence of a significant adverse event that is not fully covered by insurance could result in the loss of ou r
         total investment in a particu lar prospect and additional liability fo r us, which could have a material adverse effect on our
         financial condition and results of operations and prospects.


            The cost of decommissioning is uncertain.

              We expect to incur obligations to abandon and decommission certain structures associated with our producing
         properties. To date, the industry has little experience of removing oil and gas structures from the North Sea. Few of the
         structures in the North Sea have been removed. Certain groups have been established to study issues relating to
         decommissioning and abandonment and how the costs will be borne. Because experience is limited, we cannot precisely
         predict the costs of any future decommissions for which we might become obligated. If actual decommission or
         abandonment costs exceed our estimates or reserves to satisfy such obligations, our financial condition, results of operation s
         and prospects could be materially adversely affected.


            If we are unable to fulfill commitments under any of our oil and gas interests, we will lose our interest, and our entire
            investment, in such interest.

               Our ability to retain oil and gas interests will depend on our ability to fu lfill the co mmit ments made with respect to e ach
         interest. We cannot assure you that we or the other participants in the projects will have the financial ab ility to fund thes e
         potential co mmit ments. If we are unable to fulfill co mmit ments under any of our interests, we will lose our interest, and our
         entire investment, in such interest.


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            We are subject to environmental regulations that can have a significant impact on our operations.

              Our operations are subject to a variety of national, state, local and international laws and regulations governing the
         discharge of materials into the environment or otherwise relat ing to environmental p rotection. Failure to co mply with these
         laws and regulations can result in the imposition of substantial fines and penalties as well as potential orders suspending or
         terminating our rights to operate. Some environ mental laws to which we are subject to provide for strict liability fo r
         pollution damages, rendering a person liable without regard to negligence or fault on the part of such person. In addition, we
         may be subject to claims alleging personal injury or property damage as a result of alleged exposure to hazardous substances
         such as oil and gas related products. Aquatic environments in wh ich we operate are often particularly sensitive to
         environmental impacts, wh ich may expose us to greater potential liability than that associated with explorat ion, development
         and production at many onshore locations.

              Changes in environmental laws and regulations occur frequently, and any changes that result in more stringent or costly
         requirements for oil and gas exploration and production activities could require us, as well as others in our industry, to ma ke
         significant expenditures to attain and maintain co mp liance which could have a corresponding material adverse effect on our
         competitive position, financial condition or results of operations. We cannot provide assurance that we will be ab le to
         comply with future laws and regulations to the same extent that we believe we have in the past. Similarly, we cannot always
         precisely predict the potential impact of environ mental laws and regulations which may be adopted in the future, including
         whether any such laws or regulat ions would restrict our operations in any area.

             Current and future environ mental regulations, including restrict ions on greenhouse gases due to concerns about climate
         change, could reduce the demand for our products. Our business, financial condition and results of operations could be
         materially and adversely affected if this were to occur.

              Under certain environmental laws and regulations, we could be subject to liability arising out of the conduct of
         operations or conditions caused by others, or for activ ities that were in co mpliance with all applicable laws at the time they
         were performed. Such liabilities can be significant, and if imposed could have a material adverse effect on our financial
         condition or results of operations.

            Governmental regulations to which we are subject could expose us to significant fines and/or penalties and our cost of
            compliance with such regulations could be substantial.

              Oil and gas explorat ion, development and production are subject to various types of regulation by local, state and
         national agencies. Regulations and laws affecting the oil and gas industry are comp rehensive and under constant review for
         amend ment and expansion. These regulations and laws carry substantial penalties for failure to co mply. The regulatory
         burden on the oil and gas industry increases our cost of doing business and, consequently, adversely affects our profitabilit y.
         In addition, co mpetitive conditions may be substantially affected by various forms of energy legislation and/or regulation
         considered fro m t ime to t ime by the governments and/or agencies thereof.

            We are dependent on our executive officers and need to attract and retain additional qualified personnel.

              Our future success depends in large part on the service of our executive officers. The loss of these executives could
         have a material adverse effect on our business. Although we have employ ment agreements with certain of our executive
         officers, there can be no assurance that we will have the ability to retain their services. Further, we do not maintain
         key-person life insurance on any executive officers.

              Our future success also depends upon our ability to attract, assimilate and retain highly qualified technical and other
         management personnel who are essential for the identification and development of our prospects. There can be no assurance
         that we will be ab le to attract, integrate and retain key personnel, and our failu re to do so would have a material adverse
         effect on our business.


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            Certain U.S. federal income tax deductions currently available with respect to oil and gas exploration and development
            may be eliminated as a result of future legislation.

               President Obama’s Proposed Fiscal Year 2010 Budget includes proposed legislation that would, if enacted into law,
         make significant changes to United States tax laws, includ ing the elimination of certain key U.S. federal income tax
         incentives currently available to oil and gas explorat ion and production companies. These changes include, but are not
         limited to, (i) the repeal of the percentage depletion allowance for oil and gas properties, (ii) the elimination of current
         deductions for intangible drilling and development costs, (iii) the elimination of the deduction for certain do mestic
         production activities, and (iv) an extension of the amortizat ion period for certain geological and geophysical expenditures. It
         is unclear whether any such changes will be enacted or how soon any such changes could become effect ive. The passage of
         any legislation as a result of these proposals or any other similar changes in U.S. federal inco me tax laws could eliminate
         certain tax deductions that are currently available with respect to oil and gas explorat ion and development, and any such
         change could negatively affect our financial condition and results of operations.


            Federal and state legislation and regulatory initiatives relating to hydraulic fracturing could result in increased costs
            and additional operating restrictions or delays.

               Legislat ion has been proposed in Congress to amend the federal Safe Drin king Water Act to require the disclosure of
         chemicals used by the oil and gas industry in the hydraulic fracturing process. Hydraulic fracturing involves the injection o f
         water, sand and chemicals under pressure into rock fo rmations to stimulate oil and natural gas production. Sponsors of bills
         currently pending before the Senate and House of Representatives have asserted that chemicals used in the fracturing process
         may be impacting drinking water supplies. The proposed legislation would require the reporting and public disclosure of
         chemicals used in the fracturing process, which could make it easier for third part ies opposing the hydraulic fracturing
         process to initiate legal proceedings based on allegations that specific chemicals used in the fracturing process are impairing
         groundwater or causing other damage. In addition, these bills, if adopted, could establish an additional level of regulation at
         the federal level that could lead to operational delays or increased operating costs and could result in additional regulatory
         burdens that could make it more difficult to perform hydraulic fracturing and increase our costs of compliance and doing
         business.


            The adoption of climate change legislation or regulations could result in increased operating costs and reduced
            demand for the oil and gas we produce.

               On June 26, 2009, the U.S. House of Representatives approved adoption of the “American Clean Energy and Security
         Act of 2009,” also known as the “Waxman-Markey cap-and-trade legislation” or A CESA. The purpose of ACESA is to
         control and reduce emissions of “greenhouse gases,” or “GHGs,” in the United States. GHGs are certain gases, including
         carbon dioxide and methane, that may be contributing to warming of the Earth’s atmosphere and other climatic changes.
         ACESA would establish an economy-wide cap on emissions of GHGs in the United States and would require an overall
         reduction in GHG emissions of 17% (fro m 2005 levels) by 2020, and by ov er 80% by 2050. Under A CESA, most sources of
         GHG emissions would be required to obtain GHG emission “allo wances” corresponding to their annual emissions of GHGs.
         The number of emission allowances issued each year would decline as necessary to meet ACESA ’s overall emission
         reduction goals. As the number of GHG emission allo wances declines each year, the cost or value of allowances is expected
         to escalate significantly. The net effect of A CESA will be to impose increasing costs on the combustion of carbon -based
         fuels such as oil, refined petroleum products, and gas. The U.S. Senate has begun work on its own legislation for controlling
         and reducing emissions of GHGs in the Un ited States. If the Senate adopts GHG legislation that is different fro m A CESA,
         the Senate legislation would need to be reconciled with A CESA and both chambers would be required to approve identical
         legislation before it could beco me law.

              On December 7, 2009, the U.S. Environ mental Protection Agency, or EPA, announced its official find ing that
         emissions of GHGs in the United States were endangering human health and the environment. This finding ostensibly
         authorizes EPA to begin regulating emissions of GHGs under existing provisions of the federal Clean Air Act. EPA has
         already officially proposed a rule for regulation of GHG emissions from motor vehicles, and may soon take steps to begin
         regulating emissions of GHGs fro m stationary sources. However,


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         many potentially regulated entities are expected to challenge EPA ’s “endangerment” finding and its regulatory proposals to
         limit emissions of GHGs, and it may be several years before any such regulations could take effect. President Obama has
         indicated that his admin istration prefers the adoption of legislat ion to control and reduce emissions of GHGs, but that the
         administration will p roceed to regulate emissions of GHGs under the Clean Air Act if Congress fails to adopt appropriate
         legislation. A lthough it is not possible at this time to predict whether or when Congress may act on climate change
         legislation or whether EPA may p roceed to develop and implement regulations restricting emissions of GHGs, any laws or
         regulations that may be adopted to restrict or reduce emissions of GHGs would likely require us to incur increased operating
         costs, and could have an adverse effect on demand for the oil and gas we produce.


         Risks Relating to Our Common Stock

            The trading price of our common stock may be volatile.

              Smaller capitalized co mpanies like ours often experience substantial fluctuations in the trading price of their securities.
         The trading price of our co mmon stock has fluctuated significantly and in the future may be subject to similar fluctuations.
         The trading price may be affected by a number of factors, including those set forth elsewhere herein, as well as our operating
         results, financial condit ion, announcements or drilling activ ities, general conditions in the oil and gas exp loration and
         development industry, and other events or factors, some of wh ich may be unrelated to our performance or prospects or to
         conditions in the industry as a whole.


            There is a limited market for our common stock.

              Our co mmon stock is traded on the NYSE A mex and the London Stock Exchange. Historically, there has not been an
         active trading market for a significant volu me of our co mmon stock. We are not certain that an active trading market for our
         common stock will develop, or if such a market develops, that it will be sustained, which may make it difficult for you to sell
         your shares of common stock in the future.


            If we, o ur existing stockholders or holders of our securities that are convertible into shares of our commo n stock sell
            additional shares of our common stock, the market price of our common stock could significantly decline.

              The market p rice o f our co mmon stock could decline as a result of sales of a large nu mber of shares of common stock in
         the public market or the perception that such sales could occur. These s ales, or the possibility that these sales may occur,
         might make it mo re d ifficult for us to sell equity securities in the future at a t ime and at a price that we deem appropriate .

              As of December 1, 2009, we had appro ximately 131.2 million shares of common stock outstanding. Of those shares,
         approximately 2.9 million shares are restricted shares subject to vesting periods of up to three years. The remainder of these
         shares is freely tradable.

             In addition, appro ximately 3.4 million shares are issuable upon the exercise of presently outstanding stock options
         under our employee incentive plans and 0.4 million shares are issuable upon the exercise of presently outstanding options
         and warrants outside our emp loyee incentive plans. Also 16.2 million shares are issuable upon the conversion of our
         convertible senior notes due 2012 and 40.0 million shares are issuable upon conversion of our Series C Preferred Stock,
         based upon the conversion price of $1.25, and 20.9 million shares are issuable upon conversion of our 11.5% convertible
         bonds, based on a conversion price of $2.36.


            Provisions in our articles of incorporation, bylaws and the Nevada Revised Statutes may discourage a change of
            control.

             Certain provisions of our amended and restated articles of incorporation and amended and restated bylaws and the
         Nevada Revised Statutes, or NRS, could delay or make mo re difficult a change of control transaction or other business
         combination that may be beneficial to stockholders. These provisions include, but are not


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         limited to, the ability of our board of directors to issue a series of preferred stock, classification of our board of direct ors into
         three classes and limit ing the ability of our stockholders to call a special meeting.

               We are subject to the “Combinations With Interested Stockholders Statute” and the “Control Share Acquisition Statute”
         of the NRS. The Co mbinations Statute provides that specified persons who, to gether with affiliates and associates, own, or
         within three years did o wn, 10% or mo re of the outstanding voting stock of a corporation cannot engage in specified
         business combinations with the corporation for a period of three years after the date on whic h the person became an
         interested stockholder, unless the combination or the transaction by which the person first became an interested stockholder
         is approved by the corporation’s board of directors before the person first became an interested stockholder.

               The Control Share Acquisition Statute provides that persons who acquire a “controlling interest” as defined by the
         statute, in a company may only be given fu ll voting rights in their shares if such rights are conferred by the stockholders o f
         the company at an annual or special meeting. However, any stockholder that does not vote in favor of granting such voting
         rights is entitled to demand that the company pay fair value for their shares if the acquiring person has acquired at least a
         majority of all of the voting power of the co mpany. As such, persons acquiring a controlling interest may not be able to vote
         their shares.


                                       Cauti onary Statement Concerning Forward-Looking Statements

               Certain matters discussed in this prospectus and the documents we incorporate by reference herein are “forward-looking
         statements” intended to qualify for the safe harbors from liability established by the Private Securities Lit igation Reform Act
         of 1995, Section 27A o f the Securities Act of 1933, as amended, or the Securit ies Act, and Section 21E of the Securities
         Exchange Act of 1934, as amended, or the Exchange Act. These forward -looking statements include statements that express
         a belief, expectation, or intention, as well as those that are not statements of historical fact, and may include projections and
         estimates concerning the timing and success of specific projects and our future production, revenues, income and capital
         spending. Our forward -looking statements are generally acco mpanied by words such as “estimate”, “pro ject”, “predict”,
         “believe”, “expect”, “anticipate”, “potential”, “plan”, “goal” or other words that convey the uncertainty of future events or
         outcomes. We caution you not to rely on them unduly. We have based these forward -looking statements on our current
         expectations and assumptions about future events. While our management considers these expectations and assumptions to
         be reasonable, they are inherently subject to significant business, economic, co mpetitive, regulatory and other risks,
         contingencies and uncertainties, most of wh ich are d ifficu lt to predict and many of wh ich are beyond our control. These
         risks, contingencies and uncertainties, which may not be exhaustive, relate to, among other matters, the following:

               • discovery, estimat ion, development and replacement of oil and gas reserves;

               • decreases in proved reserves due to technical or economic factors;

               • drilling of wells and other planned explo itation activit ies;

               • timing and amount of future production of oil and gas;

               • the volatility of oil and gas prices;

               • availability of drilling and production equipment;

               • operating costs such as lease operating expenses, admin istrative costs and other expenses;

               • our future operating or financial results;

               • amount, nature and timing of capital expenditures, including future develop ment costs;

               • cash flow and anticipated liquidity;

               • availability and terms of cap ital;


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               • business strategy and the availability of acquisition opportunities; and

               • factors not known to us at this time.

              Any of these factors, or a comb ination of these factors, could materially affect our future financial condition or results
         of operations and the ultimate accuracy of the forward-looking statements. The forward-looking statements are not
         guarantees of our future performance, and our actual results and future developments may differ materially fro m those
         projected in the forward-looking statements. In addition, any or all of our forward-looking statements in this prospectus and
         the documents incorporated by reference therein and herein may turn out to be incorrect. They can be affected by inaccurate
         assumptions we might make or by known or unknown risks and uncertainties, including those mentioned in “Risk Factors”
         and elsewhere in this prospectus and the documents incorporated by reference herein. Forward-looking statements speak
         only as of the date they were made. Except as required by law, we undertake no obligation to update publicly or release any
         revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus. These
         cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.


                                                                Use of Proceeds

               Unless we inform you otherwise in a prospectus supplement, the net proceeds from the sale of the securities offered
         hereby will be used for general corporate purposes, including repayment or refinancing of debt, acquisitions, working
         capital, capital expenditures, and repurchases and redemptions of securities. Pending any specific applicat ion, we may
         initially invest funds in short term marketable securities or apply them to the reduction of other short term indebtedness.


                                                                        17
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                                                 Ratio of Earnings to Fixed Charges and
                                      Earnings to Fixed Charges and Preference Securities Di vi dends

              The following table contains our consolidated ratio of earnings to fixed charges and ratio of earnings to fixed charges
         plus preferred stock dividends for the periods indicated. This informat ion should be read in conjunction with the
         consolidated financial statements and the accompanying notes incorporated by reference in this prospectus.


                                                                 Nine Months Ended
                                                                   September 30,                   Year Ended December 31,
                                                                       2009               2008      2007       2006      2005       2004


         Ratio of earnings to fixed charges                                  (a )          3.0        (a )       2.1        (a )      (a )
         Ratio of earnings to fixed charges and
           preference securities di vi dends                                 (b )          2.1        (b )       1.8        (b )     (b )


           (a) Earnings were insufficient to cover fixed charges by $18.8 million for the nine months ended September 30, 2009 and
               by $66.0 million, $36.8 million and $22.6 million for the years ended December 31, 2007, 2005 and 2004,
               respectively. Earnings included non-cash pre-tax charges (inco me) for impairments of oil and gas properties and
               unrealized (gains) losses on derivative instruments of $69.1 million for the nine months ended September 30, 2009 and
               $(39.7) million, $89.12 million, $(33.7) million and $27.1 million for the years ended December 31, 2008, 2007, 2006
               and 2005, respectively.

           (b) Earnings were insufficient to cover fixed charges by $26.7 million for the nine months ended September 30, 2009 and
               by $77.2 million, $37.0 million and $23.0 million for the years ended December 31, 2007, 2005 and 2004,
               respectively. Earnings included non-cash pre-tax charges (inco me) for impairments of oil and gas properties and
               unrealized (gains) losses on derivative instruments of $69.1 million for the nine months ended September 30, 2009 and
               $(39.7) million, $89.12 million, $(33.7) million and $27.1 million for the years ended December 31, 2008, 2007, 2006
               and 2005, respectively.

              The ratios were co mputed by dividing earnings by fixed charges and by fixed charges plus preferred stock dividends,
         respectively. For this purpose, earnings are defined as pretax earn ings fro m continuing operations before adjustment for
         minority interest and equity losses in entities with oil and gas properties, plus interest expe nse, and amortizat ion of debt
         discount and expense related to indebtedness. Fixed charges are interest expense, including amort izat ion of debt discount
         and expenses on indebtedness. Preference securities dividends are the amounts of pre -tax earn ings that are required to pay
         the dividends on outstanding preference securities.


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                                                            Descripti on of Debt Securities

              The Debt Securit ies will be subordinated debt securities. The Debt Securit ies will be issued under an indenture among
         us and a trustee to be determined (the “Trustee”).

              The Debt Securit ies may be issued from t ime to time in one or more series. The particu lar terms of each series that are
         offered by a prospectus supplement will be described in the prospectus supplement.

               The rights of Endeavour International Corporation and our creditors, including holders of the Debt Securit ies, to
         participate in the assets of any subsidiary upon the latter’s liquidation or reorganization, will be subject to the prior claims of
         the subsidiary’s creditors, except to the extent that we may ourself be a creditor with recognized claims against such
         subsidiary.

              We have summarized selected provisions of the Indenture below. The summary is not complete. The form o f Indenture
         has been filed with the SEC as an exhib it to the registration statemen t of which this prospectus is a part, and you should read
         the Indenture for provisions that may be important to you. Capitalized terms used in the summary have the meanings
         specified in the Indenture.


         General

               The Indenture provides that Debt Securities in separate series may be issued thereunder fro m t ime to t ime without
         limitat ion as to aggregate principal amount. We may specify a maximu m aggregate principal amount for the Debt Securities
         of any series. We will determine the terms and conditions of the Debt Securit ies, including the maturity, principal and
         interest, but those terms must be consistent with the Indenture. The Debt Securities will be our unsecured obligations.

              The Debt Securit ies will be subordinated in right of pay ment to the prior pay ment in full of all of our Senior Debt (as
         defined) as described under “— Subordination of Debt Securities ” and in the prospectus supplement applicab le to any Debt
         Securities. If the prospectus supplement so indicates, the Debt Securities will be convertible into our common stock.

              The applicable prospectus supplement will set forth the price or prices at which the Debt Securities to be issued will be
         offered for sale and will describe the fo llo wing terms of such Debt Securities:

                    (1) the title of the Debt Securities;

                    (2) the related subordination terms;

                    (3) any limit on the aggregate principal amount of the Debt Securities;

                    (4) each date on which the principal of the Debt Securities will be payable;

                    (5) the interest rate that the Debt Securities will bear and the interest payment dates for the Debt Securities;

                    (6) each place where pay ments on the Debt Securit ies will be payable;

                    (7) any terms upon which the Debt Securit ies may be redeemed, in whole or in part, at our option;

                   (8) any sinking fund or other provisions that would obligate us to redeem or otherwise repurchase the Debt
               Securities;

                    (9) the portion of the principal amount, if less than all, of the Debt Securit ies that will be payable upon declaration
               of accelerat ion of the Maturity of the Debt Securities;

                    (10) whether the Debt Securities are defeasible;

                    (11) any addition to or change in the Events of Default;
     (12) whether the Debt Securities are convertible into our co mmon stock and, if so, the terms and conditions upon
which conversion will be effected, including the in itial conversion price or conversion rate and any adjustments thereto
and the conversion period;


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                    (13) any addition to or change in the covenants in the Indenture applicable to the Debt Securit ies; and

                    (14) any other terms of the Debt Securit ies not inconsistent with the provisions of the Inde nture.

              Debt Securit ies, including any Debt Securit ies that provide for an amount less than the principal amount thereof to be
         due and payable upon a declaration of acceleration of the Maturity thereof (“Orig inal Issue Discount Securities ”), may be
         sold at a substantial discount below their p rincipal amount. Special U.S. federal income tax considerations applicable to Debt
         Securities sold at an orig inal issue discount may be described in the applicab le prospectus supplement. In addition, sp ecial
         U.S. federal inco me tax or other considerations applicable to any Debt Securities that are denominated in a currency or
         currency unit other than U.S. dollars may be described in the applicable prospectus supplement.


         Subordination of Debt Securities

               The indebtedness evidenced by the Debt Securities will, to the extent set forth in the Indenture with respect to each
         series of Debt Securit ies, be subordinate in right of pay ment to the prior payment in fu ll of all of our Senior Debt and it may
         also be senior in right of payment to all of our Subordinated Debt. The prospectus supplement relating to any Debt Securities
         will summarize the subordination provisions of the Indenture applicable to that series including:

               • the applicability and effect of such provisions upon any payment or distribution respecting that series following any
                 liquidation, d issolution or other winding-up, or any assignment for the benefit of creditors or other marshalling of
                 assets or any bankruptcy, insolvency or similar proceedings;

               • the applicability and effect of such provisions in the event of specified defaults with respect to any Senior Debt,
                 including the circu mstances under which and the periods during which we will be prohibited fro m making payments
                 on the Debt Securities; and

               • the definition of Senior Debt applicab le to the Subordinated Debt Securities of that series and, if the series is issued
                 on a senior subordinated basis, the definition of Subordinated Debt applicable to that series.

             The prospectus supplement will also describe as of a recent date the approximate amount of Sen ior Debt to which the
         Debt Securit ies of that series will be subordinated.

              The failure to make any payment on any of the Debt Securities by reason of the subord ination provisions of the
         Indenture described in the prospectus supplement will not be construed as preventing the occurrence of an Event of Default
         with respect to the Debt Securities arising fro m any such failure to make pay ment.

              The subordination provisions described above will not be applicab le to payments in respect of the Debt Securit ies fro m
         a defeasance trust established in connection with any legal defeasance or covenant defeasance of the Debt Securit ies as
         described under “— Legal Defeasance and Covenant Defeasance.”


         Form, Exchange and Transfer

              The Debt Securit ies of each series will be issuable only in fully reg istered form, without coupons, and, unless otherwise
         specified in the applicab le prospectus supplement, only in deno minations of $1,000 and integral mu ltip les thereof.

             At the option of the Holder, subject to the terms of the Indenture and the limitations applicable to Global Securities,
         Debt Securit ies of each series will be exchangeable for other Debt Securities of the same series of any authorized
         denomination and of a like tenor and aggregate principal amount.

              Subject to the terms of the Indenture and the limitations applicable to Global Securit ies, Debt Securities may be
         presented for exchange as provided above or for registration of transfer (duly endorsed or with the form of trans fer endorsed
         thereon duly executed) at the office of the Security Reg istrar or at the office of any transfer agent designated by us for su ch
         purpose. No service charge will be made for any registration of transfer or exchange of Debt Securities, but we may require
         payment of a sum sufficient to cover any tax or


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         other governmental charge payable in that connection. Such transfer or exchange will be effected upon the Security Reg istrar
         or such transfer agent, as the case may be, being satisfied with the documents of title and identity of the person making the
         request. The Security Registrar and any other transfer agent initially designated by us for any Debt Securit ies will be named
         in the applicable p rospectus supplement. We may at any time designate additional transfer agents or rescind the designation
         of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required
         to maintain a transfer agent in each Place of Pay ment for the Debt Securit ies of each series.

              If the Debt Securit ies of any series (or of any series and specified tenor) are to be redeemed in part, we will not be
         required to (1) issue, register the transfer of or exchange any Debt Security of that series (or o f that series and specified
         tenor, as the case may be) during a period beginning at the opening of business 15 days before the day of mailing of a notice
         of redemption of any such Debt Security that may be selected for redempt ion and ending at the close of business on the day
         of such mailing or (2) register the transfer of or exchange any Debt Security so selected for redemption, in whole o r in part,
         except the unredeemed portion of any such Debt Security being redeemed in part.


         Gl obal Securities

               Some or all of the Debt Securit ies of any series may be represented, in whole or in part, by one or mo re Global
         Securities that will have an aggregate principal amount equal to that of the Debt Securities they represent. Each Global
         Security will be reg istered in the name of a Depositary or its nominee identified in the applicable p rospectus s upplement,
         will be deposited with such Depositary or nominee or its custodian and will bear a legend regarding the restrictions on
         exchanges and registration of transfer thereof referred to below and any such other matters as may be provided for pursuant
         to the Indenture.

             Notwithstanding any provision of the Indenture or any Debt Security described in this prospectus, no Global Security
         may be exchanged in whole or in part for Debt Securities registered, and no transfer of a Global Security in whole or in part
         may be registered, in the name of any Person other than the Depositary for such Global Security or any nominee of such
         Depositary unless:

                    (1) the Depositary has notified us that it is unwilling or unable to continue as Depositary for such Global Security
               or has ceased to be qualified to act as such as required by the Indenture, and in either case we fail to appoint a successor
               Depositary within 90 days;

                    (2) an Event of Default with respect to the Debt Securities represented by such Global Security has occurred and is
               continuing and the Trustee has received a written request fro m the Depositary to issue certificated Debt Securities;

                   (3) subject to the rules of the Depositary, we shall have elected to terminate the book-entry system through the
               Depositary; or

                    (4) other circu mstances exist, in addition to or in lieu of those described above, as may be described in the
               applicable prospectus supplement.

              All certificated Debt Securities issued in exchange for a Global Security or any portion thereof will be registered in
         such names as the Depositary may direct.

               As long as the Depositary, or its nominee, is the registered holder of a Global Secu rity, the Depositary or such nominee,
         as the case may be, will be considered the sole owner and Holder of such Global Security and the Debt Securit ies that it
         represents for all purposes under the Debt Securities and the Indenture. Except in the limited circu mstances referred to
         above, owners of beneficial interests in a Global Security will not be entitled to have such Global Security or any Debt
         Securities that it represents registered in their names, will not receive or be entit led to receive physical de livery of
         certificated Debt Securities in exchange for those interests and will not be considered to be the owners or Holders of such
         Global Security or any Debt Securities that is represents for any purpose under the Debt Securities or the Indenture. All
         payments on a Global Security will be made to the Depositary or its nominee, as the case may be, as the Holder of the
         security. The laws of some ju risdictions may require that some purchasers of Debt Securit ies take physical


                                                                         21
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         delivery of such Debt Securities in cert ificated form. These laws may impair the ability to transfer beneficial interests in a
         Global Security.

               Ownership of beneficial interests in a Global Security will be limited to institutions that have accounts with the
         Depositary or its nominee (“participants”) and to persons that may hold beneficial interests through participants. In
         connection with the issuance of any Global Security, the Depositary will credit, on its book-entry registration and transfer
         system, the respective principal amounts of Debt Securities represented by the Global Security to the accounts of its
         participants. Ownership of beneficia l interests in a Global Security will be shown only on, and the transfer of those
         ownership interests will be effected only through, records maintained by the Depositary (with respect to participants ’
         interests) or any such participant (with respect to interests of Persons held by such participants on their behalf). Pay ments,
         transfers, exchanges and other matters relat ing to beneficial interests in a Global Security may be subject to various policies
         and procedures adopted by the Depositary fro m t ime to t ime. None of us, the Trustees or the agents of us, or the Trustees
         will have any responsibility or liability for any aspect of the Depositary ’s or any participant’s records relating to, or for
         payments made on account of, beneficial interests in a Global Security, o r for maintaining, supervising or reviewing any
         records relating to such beneficial interests.

         Payment and Paying Agents

               Unless otherwise indicated in the applicable prospectus supplement, pay ment of interest on a Debt Security on any
         Interest Payment Date will be made to the Person in whose name such Debt Security (or one or mo re Predecessor Securit ies)
         is registered at the close of business on the Regular Record Date for such interest.

               Unless otherwise indicated in the applicable prospectus supplement, principal of and any premiu m and interest on the
         Debt Securit ies of a particu lar series will be payable at the office of such Paying Agent or Paying Agents as we may
         designate for such purpose from t ime to time, except that at our option payment of any interest on Debt Securities in
         certificated form may be made by check mailed to the address of the Person entitled thereto as such address appears in the
         Security Register. Unless otherwise indicated in the applicable p rospectus supplement, the corporate trust office of the
         Trustee under the Indenture in The City of New Yo rk will be designated as the sole Paying Agent for payment with respect
         to Debt Securities of each series. Any other Paying Agents initially designated by us for the Debt Securities of a part icular
         series will be named in the applicable prospectus supplement. We may at any time designate additional Pay ing Agents or
         rescind the designation of any Paying Agent or approve a change in the office through which any Paying Agent acts, except
         that we will be required to maintain a Pay ing Agent in each Place of Pay ment for the Debt Securit ies of a particu lar series.

             All money paid by us to a Paying Agent for the payment of the princip al of or any premiu m or interest on any Debt
         Security wh ich remains unclaimed at the end of two years after such principal, premiu m or interest has become due and
         payable will be repaid to us, and the Holder of such Debt Security thereafter may look only t o us for pay ment.

         Consolidation, Merger and Sale of Assets

              Unless otherwise specified in the prospectus supplement, we may not consolidate with or merge into, or transfer, lease
         or otherwise dispose of all or substantially all of our assets to, any Person (a “successor Person”), and may not permit any
         Person to consolidate with or merge into us, unless:

                   (1) the successor Person (if not us) is a corporation, partnership, trust or other entity organized and valid ly existing
               under the laws of any domestic jurisdiction and assumes our obligations on the Debt Securities and under the Indenture;

                   (2) immed iately before and after giving pro forma effect to the transaction, no Event of Default , and no event
               which, after notice or lapse of time or both, would beco me an Event of Default, has occurred and is continuing; and

                   (3) several other conditions, including any additional conditions with respect to any particular Debt Securit ies
               specified in the applicab le prospectus supplement, are met.


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              The successor Person (if not us) will be substituted for us under the Indenture with the same effect as if it had been an
         original party to the Indenture, and, except in the case of a lease, we will be relieved fro m any further obligations under the
         Indenture and the Debt Securities.


         Events of Defaul t

             Unless otherwise specified in the prospectus supplement, each of the following will constitute an Event of Defau lt
         under the Indenture with respect to Debt Securities of any series:

                   (1) failure to pay principal of or any premiu m on any Debt Security of t hat series when due, whether or not such
               payment is prohibited by the subordination provisions of the Indenture;

                   (2) failure to pay any interest on any Debt Securit ies of that series when due, continued for 30 days, whether or not
               such payment is prohibited by the subordination provisions of the Indenture;

                    (3) failure to deposit any sinking fund payment, when due, in respect of any Debt Security of that series, whether
               or not such deposit is prohibited by the subordination provisions of the Indenture;

                   (4) failure to perform or co mp ly with the provisions described under “— Consolidation, Merger and Sale of
               Assets”;

                    (5) failure to perform any of our other covenants in the Indenture (other than a covenant included in the Indenture
               solely for the benefit of a series other than that series), continued for 60 days after written notice has been given by the
               Trustee, or the Holders of at least 25% in principal amount of the Outstanding Debt Securities of that series , as provided
               in the Indenture;

                   (6) any Debt of ourself or any Significant Subsidiary is not paid within any applicable grace period after final
               maturity or is accelerated by its holders because of a default and the total amount of such Debt unpaid or ac celerated
               exceeds $20.0 million;

                    (7) any judg ment or decree for the payment of money in excess of $20.0 million is entered against us or any
               Significant Subsidiary remains outstanding for a period of 60 consecutive days following entry of such judgment a nd is
               not discharged, waived or stayed; and

                    (8) certain events of bankruptcy, insolvency or reorganization affecting us or any Significant Subsidiary.

               If an Event of Default (other than an Event of Default with respect to Endeavour International Co rporation described in
         clause (8) above) with respect to the Debt Securities of any series at the time Outstanding occurs and is continuing, either the
         Trustee or the Holders of at least 25% in principal amount of the Outstanding Debt Securities of that series by notice as
         provided in the Indenture may declare the principal amount of the Debt Securities of that series (or, in the case of any Debt
         Security that is an Original Issue Discount Debt Security, such portion of the principal amount of such Debt Securit y as may
         be specified in the terms of such Debt Security) to be due and payable immed iately, together with any accrued and unpaid
         interest thereon. If an Event of Defau lt with respect to Endeavour International Corporation described in clause (8) above
         with respect to the Debt Securities of any series at the time Outstanding occurs, the principal amount of all the Debt
         Securities of that series (or, in the case of any such Original Issue Discount Security, such specified amount) will
         automatically, and without any action by the Trustee or any Holder, become immediately due and payable, together with any
         accrued and unpaid interest thereon. After any such acceleration and its consequences, but before a judg ment or decree based
         on acceleration, the Holders of a majority in principal amount of the Outstanding Debt Securities of that series may, under
         certain circu mstances, rescind and annul such acceleration if all Events of Default with respect to that series, other than t he
         non-payment of accelerated principal (or other specified amount), have been cured or waived as provided in the Indenture.
         For informat ion as to waiver of defau lts, please read “— Modification and Waiver” belo w.

              Subject to the provisions of the Indenture relat ing to the duties of the Trustees in case an Event of Default has occurred
         and is continuing, no Trustee will be under any obligation to exercise any of its rights or powers under the Indenture at the
         request or direction of any of the Holders, unless such Holders have offered


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         to such Trustee reasonable security or indemnity. Subject to such provisions for the inde mnification of the Trustees, the
         Holders of a majority in principal amount of the Outstanding Debt Securities of any series will have the right to direct the
         time, method and place of conducting any proceeding for any remedy available to the Trustee or exe rcising any trust or
         power conferred on the Trustee with respect to the Debt Securities of that series.

              No Ho lder of a Debt Security of any series will have any right to institute any proceeding with respect to the Indenture,
         or for the appointment of a receiver or a trustee, or for any other remedy thereunder, unless:

                   (1) such Holder has previously given to the Trustee under the Indenture written notice of a continuing Event of
               Default with respect to the Debt Securities of that series;

                    (2) the Ho lders of at least 25% in principal amount of the Outstanding Debt Securities of that series have made
               written request, and such Holder or Ho lders have offered reasonable security or indemn ity, to the Trustee to institute
               such proceeding as trustee; and

                    (3) the Trustee has failed to institute such proceeding, and has not received fro m the Holders of a majority in
               principal amount of the Outstanding Debt Securities of that series a direct ion inconsistent with such request, within
               60 days after such notice, request and offer.

              However, such limitations do not apply to a suit instituted by a Holder of a Debt Security for the enforcement of
         payment of the principal of or any premiu m or interest on such Debt Security on or after the applicable due date specified in
         such Debt Security or, if applicable, to convert such Debt Security.

               We will be required to furnish to the Trustee annually a statement by certain of our officers as to whether or not we, to
         their knowledge, are in defau lt in the performance or observance of any of the terms, provisions and conditions of the
         Indenture and, if so, specifying all such known defaults.


         Modi fication and Wai ver

               We may mod ify or amend the Indenture without the consent of any holders of the Debt Securities in certain
         circu mstances, including:

                    (1) to evidence the succession under the Indenture of another Person to us and to provide for its assumption of our
               obligations to holders of Debt Securities;

                    (2) to make any changes that would add any additional covenants of us for the benefit of the holders of Debt
               Securities or that do not adversely affect the rights under the Indenture of the Holders of Debt Securit ies in any material
               respect;

                    (3) to add any additional Events of Default;

                    (4) to provide for uncertificated notes in addition to or in p lace of certificated notes;

                    (5) to secure the Debt Securities;

                    (6) to establish the form or terms of any series of Debt Securit ies;

                    (7) to evidence and provide for the acceptance of appointment under the Indenture of a successor Trustee;

                    (8) to cure any ambiguity, defect or inconsistency; or

                   (9) to make any change in the subordination provisions that limits or terminates the benefits applicable to any
               Holder of Sen ior Debt.

             Other modificat ions and amendments of an Indenture may be made by us and the Trustee with the consent of the
         Holders of not less than a majority in principal amount of the Outstanding Debt Securities of
24
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         each series affected by such modification or amend ment; provided, however, that no such modificat ion or amend ment may,
         without the consent of the Holder of each Outstanding Debt Security affected thereby:

                   (1) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Debt
               Security;

                    (2) reduce the principal amount of, or any premiu m or interest on, any Debt Security;

                    (3) reduce the amount of principal of an Original Issue Discount Security or any other Debt Security payable upon
               acceleration of the Maturity thereof;

                    (4) change the place or currency of pay ment of principal o f, or any premiu m or interest on, any Debt Security;

                    (5) impair the right to institute suit for the enforcement of any payment due on or any conversion right with respect
               to any Debt Security;

                    (6) modify the subordination provisions, or modify any conversion provisions, in either case in a manner adverse
               to the Holders of the Debt Securit ies;

                   (7) reduce the percentage in principal amount of Outstanding Debt Securities of any series, the consent of whose
               Holders is required for modification or amendment of the Indenture;

                   (8) reduce the percentage in principal amount of Outstanding Debt Securities of any series necessary for waiver of
               compliance with certain p rovisions of the Indenture or for waiver of certain defaults;

                    (9) modify such provisions with respect to modification, amend ment or waiver; or

                    (10) following the making of an offer to purchase Debt Securit ies fro m any Holder that has been made pursuant to
               a covenant in the Indenture, modify such covenant in a manner adverse to such Holder.

              The Holders of not less than a majority in principal amount of the Outstanding Debt Securities of any series may waive
         compliance by us with certain restrictive provisions of the Indenture. The Holders o f not less than a majority in p rincipal
         amount of the Outstanding Debt Securities of any series may waive any past default under the Indenture, except a default in
         the payment of principal, p remiu m or interest and certain covenants and provisions of the In denture which cannot be
         amended without the consent of the Holder of each Outstanding Debt Security of such series.

             The Indenture provides that in determining whether the Ho lders of the requisite principal amount of the Outstanding
         Debt Securit ies have given or taken any direction, notice, consent, waiver or other action under the Indenture as of any date:

                   (1) the principal amount of an Original Issue Discount Security that will be deemed to be Outstanding will be the
               amount of the principal that would be due and payable as of such date upon acceleration of maturity to such date;

                     (2) if, as of such date, the principal amount payable at the Stated Maturity of a Debt Security is not determinable
               (for examp le, because it is based on an index), the principal amount of such Debt Security deemed to be Outstanding as
               of such date will be an amount determined in the manner prescribed fo r such Debt Security;

                    (3) the principal amount of a Debt Security denominated in one or mo re foreign currencies or currency u nits that
               will be deemed to be Outstanding will be the Un ited States -dollar equivalent, determined as of such date in the manner
               prescribed for such Debt Security, of the principal amount of such Debt Security (or, in the case of a Debt Security
               described in clause (1) or (2) above, of the amount described in such clause); and

                   (4) certain Debt Securities, including those owned by us or any of our Affiliates, will not be deemed to be
               Outstanding.


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               Except in certain limited circu mstances, we will be entitled to set any day as a record date for the purpose of
         determining the Holders of Outstanding Debt Securities of any series entitled to give or take any direction, notice, consent,
         waiver or other action under the Indenture, in the manner and subject to the limitations provided in the Indenture. In certain
         limited circu mstances, the Trustee will be entit led to set a record date for action by Ho lders. If a record date is set for any
         action to be taken by Holders of a particular series, only persons who are Holders of Outstanding Debt Securit ies of that
         series on the record date may take such action. To be effective, such action must be taken by Holders of the requisite
         principal amount of such Debt Securities within a specified period following the record date. For any particular record date,
         this period will be 180 days or such other period as may be specified by us (or the Trustee, if it set the record date), and may
         be shortened or lengthened (but not beyond 180 days) fro m time to time.


         Satisfaction and Discharge

              The Indenture will be discharged and will cease to be of further effect as to all outstanding Debt Securities of any series
         issued thereunder, when:

               either:

                   (1) (a) all outstanding Debt Securities of that series that have been authenticated (except los t, stolen or destroyed
               Debt Securit ies that have been replaced or paid and Debt Securities for whose payment money has theretofore been
               deposited in trust and thereafter repaid to us) have been delivered to the Trustee for cancellation; or

                    (b) all outstanding Debt Securities of that series that have been not delivered to the Trustee for cancellation have
               become due and payable or will beco me due and payable at their Stated Maturity within one year or are to be called for
               redemption with in one year under arrangements satisfactory to the Trustee and in any case we have irrevocably
               deposited with the Trustee as trust funds money in an amount sufficient, without consideration of any reinvestment of
               interest, to pay the entire indebtedness of such Debt Securities not delivered to the Trustee for cancellation, for
               principal, premiu m, if any, and accrued interest to the Stated Maturity or redemption date;

                   (2) we have paid or caused to be paid all other sums payable by us under the Indenture with respect to the Debt
               Securities of that series; and

                    (3) we have delivered an Officers ’ Certificate and an Op inion of Counsel to the Trustee stating that all conditions
               precedent to satisfaction and discharge of the Indenture with respect to the Debt Securities of that series have been
               satisfied.


         Legal Defeasance and Covenant Defeasance

              To the extent indicated in the applicable p rospectus supplement, we may elect, at our option at any time, to have our
         obligations discharged under provisions relating to defeasance and discharge of indebtedness, which we call “legal
         defeasance,” or relating to defeasance of certain restrictive covenants applied to the Debt Securities o f any series, or to any
         specified part of a series, which we call “covenant defeasance.”


            Legal Defeasance

              The Indenture provides that, upon our exercise of our option (if any) to have the legal defeasance provisions applied to
         any series of Debt Securit ies, we will be d ischarged from all our obligations, and the provisions of the Indenture relating t o
         subordination will cease to be effective, with respect to such Debt Securities (except for certain obligations to convert,
         exchange or register the transfer of Debt Securities, to rep lace stolen, lost or mutilated Debt Securit ies, to maintain payin g
         agencies and to hold moneys for payment in trust) upon the deposit in trust for the benefit of the Holders of such Debt
         Securities of money or U.S. Govern ment Ob ligations, or both, which, through the payment of principal and interest in
         respect thereof in accordance with their terms, will p rovide money in an amount sufficient (in the opinion of a nationally
         recognized firm of independent public accountants) to pay the principal of and any premiu m and interest on


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         such Debt Securit ies on the respective Stated Maturities in accordance with the terms of the Indenture and such Debt
         Securities. Such defeasance or discharge may occur only if, among other things:

                    (1) we have delivered to the Trustee an Opinion of Counsel to the effect that we have received fro m, or there has
               been published by, the United States Internal Revenue Service a ruling, or there has been a change in tax law, in either
               case to the effect that Holders of such Debt Securities will not recognize gain or loss for federal inco me tax purposes as
               a result of such deposit and legal defeasance and will be subject to federal income tax on the same amount, in the same
               manner and at the same t imes as would have been the case if such deposit and legal defeasance were not to occur;

                   (2) no Event of Defau lt or event that with the passing of time or the giving of notice, or both, shall constitute an
               Event of Default shall have occurred and be continuing at the time of such deposit or, with respect to any Event of
               Default described in clause (8) under “— Events of Defau lt,” at any time until 121 days after such deposit;

                    (3) such deposit and legal defeasance will not result in a breach or vio lation of, or constitute a default under, any
               agreement or instrument (other than the Indenture) to which we are a party or by which we are bound;

                    (4) at the time of such deposit, no default in the payment of all or a port ion of principal of (o r premiu m, if any) or
               interest on any Senior Debt shall have occurred and be continuing, no event of default shall have resulted in the
               acceleration of any Sen ior Debt and no other event of default with respect to any Senior Debt shall have occurred and
               be continuing permitt ing after notice or the lapse of time, or both, the acceleration thereof; and

                   (5) we have delivered to the Trustee an Opinion of Counsel to the effect that such deposit shall no t cause the
               Trustee or the trust so created to be subject to the Investment Co mpany Act of 1940.


            Covenant Defeasance

               The Indenture provides that, upon our exercise of our option (if any) to have the covenant defeasance provisions applied
         to any Debt Securities, we may fail to co mply with certain restrict ive covenants (but not with respect to conversion, if
         applicable), including those that may be described in the applicable prospectus supplement, and the occurrence of certain
         Events of Default, wh ich are described above in clause (5) (with respect to such restrictive covenants) and clauses (6) and
         (7) under “Events of Default” and any that may be described in the applicable prospectus supplement, will not be deemed to
         either be or result in an Event of Default and the provisions of the Indenture relating to subordination will cease to be
         effective, in each case with respect to such Debt Securit ies. In order to exercise such option, we must deposit, in trust for the
         benefit of the Holders of such Debt Securities, money or U.S. Govern ment Obligations, or both, which, through the payment
         of principal and interest in respect thereof in accordance with their terms, will provide money in an amount sufficient (in t he
         opinion of a nationally recognized firm of independent public accountants) to pay the principal of and any premiu m and
         interest on such Debt Securities on the respective Stated Maturities in accordance with the terms of the Indenture and such
         Debt Securit ies. Such covenant defeasance may occur only if we have delivered to the Trustee an Opinion of Counsel to the
         effect that Holders of such Debt Securit ies will not recognize gain or loss for federal inco me tax purposes as a result of su ch
         deposit and covenant defeasance and will be subject to federal in co me tax on the same amount, in the same manner and at
         the same times as would have been the case if such deposit and covenant defeasance were not to occur, and the requirements
         set forth in clauses (2), (3), (4) and (5) above are satisfied. If we exercise this option with respect to any series of Debt
         Securities and such Debt Securities were declared due and payable because of the occurrence of any Event of Default, the
         amount of money and U.S. Govern ment Obligations so deposited in trust would be sufficient to pay amounts due on such
         Debt Securit ies at the time of their respective Stated Maturities but may not be sufficient to pay amounts due on such Debt
         Securities upon any acceleration resulting fro m such Event of Defau lt. In such case, we would remain l iable for such
         payments.


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         Notices

             Notices to Holders of Debt Securit ies will be given by mail to the addresses of such Holders as they may appear in the
         Security Register.


         Title

              We the Trustee and any agent of us the or the Trustee may treat the Person in whose name a Debt Security is registered
         as the absolute owner of the Debt Security (whether or not such Debt Security may be overdue) fo r the purpose of making
         payment and for all other purposes.


         Governing Law

             The Indenture and the Debt Securit ies will be governed by, and construed in accordance with, the law of the State of
         New York.


         The Trustee

               We will enter into the Indenture with a Trustee that is qualified to act und er the Trust Indenture Act of 1939, as
         amended, and with any other Trustees chosen by us and appointed in a supplemental indenture for a part icular series of Debt
         Securities. We may maintain a banking relationship in the ordinary course of business with ou r Trustee and one or more of
         its affiliates.


            Resignation or Removal of Trustee

               If the Trustee has or acquires a conflicting interest within the meaning of the Trust Indenture Act, the Trustee must
         either eliminate its conflicting interest or resign, to the extent and in the manner provided by, and subject to the provisio ns
         of, the Trust Indenture Act and the Indenture. Any resignation will require the appointment of a successor Trustee under the
         Indenture in accordance with the terms and conditions of the Indenture.

              The Trustee may resign or be removed by us with respect to one or more series of Debt Securities and a successor
         Trustee may be appointed to act with res pect to any such series. The holders of a majority in aggregate principal amount of
         the Debt Securities of any series may remove the Trustee with respect to the Debt Securities of such series.


            Limitations on Trustee if It Is Our Creditor

              The Indenture will contain certain limitations on the right of the Trustee, in the event that it becomes our creditor, to
         obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as securit y
         or otherwise.


            Certificates and Opinions to Be Furnished to Trustee

               The Indenture will provide that, in addition to other certificates or opinions that may be specifically required by other
         provisions of the Indenture, every application by us for action by the Trustee must be accompanied by an Officers ’
         Cert ificate and an Opin ion of Counsel stating that, in the opinion of the signers, all conditions precedent to such action ha ve
         been complied with by us.


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                                                          Descripti on of Capi tal Stock


         General

              Our amended and restated articles of incorporation authorize us to issue 310,000,000 shares of capital stock, consisting
         of 300,000,000 shares of co mmon stock, par value $0.001 per share, and 10,000,000 shares of preferred stock, par value
         $0.001 per share. The following summary description of our capital stock is not complete and does not give effect to
         applicable statutory and common law. This summary description is also subject to the applicable provisions of our amended
         and restated articles of incorporation and amended and restated bylaws.

               The transfer agent and registrar for our co mmon stock is StockTrans, Inc., and its telephone number is (610) 649-7300.


         Common Stock

               As of December 1, 2009, there were 131,165,229 shares of our common stock issued and outstanding, including
         333,333 shares of unvested restricted common stock pursuant to inducement grants and 1,771,740 shares of unvested
         restricted stock awards pursuant to our stock option plans. In addition, as of December 1, 2009, (a) 40,000,000 shares of
         common stock were reserved for issuance pursuant to the conversion of our Series C Preferred Stock, (b) 16,185,259 shares
         of common stock were reserved for issuance pursuant to the conversion of our 6.00% convertible notes due 2012,
         (c) 33,490,700 shares of common stock were reserved for issuance pursuant to the conversion of our 11.5% convertible
         bonds due 2014, (d) 20,200,000 shares of common stock were reserved for issuance pursuant to our stock option plans, of
         which options to purchase 3,447,789 shares at a weighted average exercise price of $2.01 per share had been issued,
         (e) 90,000 shares of common stock were reserved for issuance pursuant to warrants outside of our stock plans, and
         (f) 850,000 shares of common stock were reserved for issuance pursuant to inducement grants.

               Shares of our common stock are alike and equal in all respects and have one vote for each share held of record for the
         election of directors and all other matters submitted to the vote of stockholders. Holders of our co mmon stock do not have
         cumulat ive voting rights, and thus, holders of a majority of the shares of our common stock represented at a meeting at
         which a quoru m is present can elect all d irectors to be elected at such meeting. Subject to any restrictions imposed by any of
         our lenders and after any requirements with respect to preferential dividends, if any, on the preferred stock have been met,
         then, and not otherwise, dividends payable in cash or in any other mediu m may be declared by our board of d irectors and
         paid on the shares of common stock out of funds legally available therefore. After satisfaction of all our debts and liabilit ies
         and distribution in full of the preferential amount, if any, to be distributed to the ho lders of preferred stock in the event of
         voluntary or involuntary liquidation, d issolution, distribution of assets or our winding -up, the holders of our co mmon stock
         shall be entitled to receive all of our remaining assets of whatever kind available for distribution to stockholders ratably in
         proportion to the number of shares of common stock held by them respectively. The holders of our common stock do not
         have any preferential, preempt ive right, or other right of subscription to acquire any of our shares authorized, issued or sold,
         or to be authorized, issued or sold (or any instrument convertible into our shares) other than to the extent, if any, our boa rd of
         directors may determine fro m t ime to time.


         Preferred Stock

              Our board of d irectors has the authority, without stockholder approval, to issue preferred stock in one or more series at
         such time or t imes and for such consideration as our board of directors may determine pursuant to a resolution or resolutions
         providing for such issuance duly adopted by our board of directors and may determine, for any series of preferred stock, the
         terms and rights of the series, including the fo llo wing:

               • the distinctive designation, stated value and number of shares comprising such series, which nu mber may (except
                 where otherwise provided by our board of directors in creating such series) be increased or decreased (but not below
                 the number of shares then outstanding) fro m t ime to t ime by action of our board of directors;


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               • the rate of dividend, if any, on the shares of that series, whether dividends shall be cu mulat ive and, if so, fro m wh ich
                 date, and the relative rights of priority, if any, of pay ment of div idends on shares of that series over shares of any
                 other series;

               • whether the shares of that series shall be redeemable and, if so, the terms and conditions of such redemption,
                 including the date upon or after which they shall be redeemable, and the amount per share payable in case of
                 redemption, which amount may vary under different conditions and at different redemption dates, or the property or
                 rights, including securities of any other corporation, payable in case of redemption;

               • whether that series shall have a sinking fund for the redemption or purchase of shares of that series and, if so, the
                 terms and amounts payable into such sinking fund;

               • the rights to which the holders of the shares of that series shall be entitled in the event of our voluntary or
                 involuntary liquidation, d issolution, distribution of assets or winding -up and the relative rights of priority, if any, o f
                 payment of shares of that series;

               • whether the shares of that series shall be convertible into or exchangeable for shares of capital stock of any class or
                 any other series of preferred stock and, if so, the terms and conditions of such conversion or exchange including the
                 rate of conversion or exchange, the date upon or after wh ich they shall be convertible or exch angeable, the duration
                 for which they shall be convertible or exchangeable, the event upon or after wh ich they shall be convertible or
                 exchangeable, at whose option they shall be convertible or exchangeable, and the method of adjusting the rate of
                 conversion or exchange in the event of a stock split, stock dividend, comb ination of shares or similar event;

               • whether the shares of that series shall have voting rights in addition to the voting rights provided by law and, if so,
                 the terms of such voting rights;

               • whether the issuance of any additional shares of such series, or of any shares of any other series, shall be subject to
                 restrictions as to issuance, or as to the powers, preferences or rights of any such other series; and

               • any other preferences, privileges and powers, and relative, part icipating, optional o r other special rights, and
                 qualification, limitat ion or restriction of such series, as our board of directors may deem advisable and as shall not
                 be inconsistent with the provisions of our amended and restated articles of incorporation and to the full ext ent now
                 or hereafter permitted by the laws of the State of Nevada.

              Because the holders of our preferred stock may be entitled to vote on some matters as a class, issuance of our preferred
         stock could have the effect of delaying, deferring or preventing a change of control. The rights of the holders of our common
         stock may be adversely affected by the rights of the holders of preferred stock that may be issu ed in the future. The issuance
         of preferred stock, while p roviding desirable flexib ility, could have the effect of making it more difficu lt for a third part y to
         acquire control of us.


         Series B Preferred Stock

              Of the 10,000,000 shares of our authorized preferred stock, 376,287 shares are designated as Series B Preferred Stock,
         par value $0.001 per share. The authorized shares of Series B Preferred Stock were originally 500,000 shares, however, as a
         result of our repurchase of an aggregate of 123,713 shares of Series B Preferred Stock in connection with our February 2004
         restructuring, the authorized shares were reduced fro m 500,000 to 376,287.

               The Series B Preferred Stock generally provides for the follo wing rights, preferences and obligations:

               • The shares of Series B Preferred Stock accrue a cu mu lative div idend of 8% of the $100 original issue price of such
                 shares per annum, which is payable before any dividend or other distribution on shares of our common stock.

               • In the event of our liquidation, d issolution, or winding up, the shares of Series B Preferred Stock have a liquidation
                 preference of $100 per share (p lus all accrued and unpaid dividends thereon) before any payment or distribution to
                 holders of shares of our common stock.
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               • Except as otherwise provided by law, holders of shares of Series B Preferred Stock have the right to vote together
                 with the holders of our co mmon stock on all matters presented to holders of our common stock and have one vote
                 per share.

               • We also have the right to redeem all or any portion of the Series B Preferred Stock at any time by payment of $100
                 per share plus all accrued and unpaid dividends due thereon.

               As of December 1, 2009, there were 19,714 shares of Series B Preferred Stock issued and outstanding.

         Series C Preferred Stock

              Of the 10,000,000 shares of our authorized preferred stock, 125,000 shares are designated as Series C Preferred Stock,
         par value $0.001 per share. The Series C Preferred Stock rank senior to any of our other existing or future shares of capital
         stock.

              The Series C Preferred Stock is fully convertible into common stock at any time at the option of the preferred stock
         investors, at (i) a conversion price of $1.25 (the “Conversion Price”) and (ii) in an amount of common stock equal to the
         quotient of the liquidation preference of $1,000 per share (the “Liquidation Preference”) d ivided by the Conversion Price.

               Div idends are payable in cash, or common stock if we are unable to pay such dividends in cash, and any dividends will
         be paid to the preferred stock investors prior to payment of any other div idend on any other shares of our capital stock. We
         will pay a cu mulat ive dividend on the Series C Preferred Stock equal to 4.5% per annum of the original issue price
         (compounded quarterly) if paid in cash and 4.722% per annum of the original issue price (co mpounded quarterly) if paid in
         stock (the “Orig inal Dividend Rate”). The Series C Preferred Stock also participates on an as -converted basis with respect to
         any dividends paid on the common stock.

               Issuance of dividends in the form of co mmon stock are subject to the following equity conditions (the “Equity
         Conditions”), wh ich are waivable by two-thirds of the holders of the Series C Preferred Stock: (i) such common stock is
         listed on the NYSE A mex, the New Yo rk Stock Exchange or the Nasdaq Stock Market, and not subject to any trading
         suspension; (ii) we are not then subject to any bankruptcy event; and (iii) such common stock will be immediately
         re-saleable by the preferred stock investors pursuant to an effective registration statement and otherwise in co mpliance with
         all applicab le laws. If we have not maintained the effectiveness of the registration statement pursuant to the registration
         rights granted to the holders of the Series C Preferred Stock, then the dividend rate on the Series C Preferred Stock will be
         increased by the product of 2.5% (if the dividend is paid in cash) or 2.63% (if the div idend is paid in stock) times the numb er
         of quarters (or portions thereof) in which the failure occurs or we fail to cu re such failure.

              After November 1, 2010, we may redeem all of the Series C Preferred Stock in exchange for a cash payment to the
         preferred stock investors of an amount equal to 102% of the sum of the Liquidation Preference plus accrued and unpaid
         dividends. If we call the Series C Preferred Stock for redemption, the holders thereof will have the right to convert their
         shares into a newly issued preferred stock identical in all respects to the Series C Preferred Stock, except that such newly
         issued preferred stock will not bear a d ividend (the “Alternate Preferred Stock”). We may not redeem the Series C Preferred
         Stock if the Equity Conditions are not then satisfied with respect to the common stock into which the Alternate Preferred
         Stock is convertible.

              Upon the tenth anniversary of the initial issuance of the Series C Preferred Stock, we must redeem all of the outstanding
         Series C Preferred Stock for an amount equal to the Liquidation Preference plus accrued and unpaid dividends payable by us
         in cash or common stock at our elect ion. Issuance by us of common stock for such redemption is subject to the Equity
         Conditions and to the market value o f the outstanding shares of common stock immediately prior to such redemption
         equaling at least $500 million.

               In the event of a change of control of Endeavour International Corporation, we will be required to offer to redeem all o f
         the Series C Preferred Stock for the greater of: (i) the amount equal to which such holder would be entit led to receive had the
         holder converted such Series C Preferred Stock into common stock; (ii) 115% of the sum of the Liquidation Preference plus
         accrued and unpaid dividends; and (iii) the amount resulting in an internal rate of return to such holder of 15% fro m the date
         of issuance of such Series C Preferred Stock through the date that Endeavour International Corporation pays the redemption
         price fo r such shares.
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               As of December 1, 2009, there were 50,000 shares of Series C Preferred Stock issued and outstanding.


         Anti -Takeover Provisions of our Articles of Incorporation and Byl aws

               Our amended and restated articles of incorporation and amended and restated bylaws contain provisions that could
         delay, discourage or make mo re difficult a tender offer, pro xy contest or other takeover attempt that is opposed by our board
         of directors but that a stockholder might consider in its best interest. The following is a summary of these provisions.


            Preferred Stock

               Although our board of directors has no current intent to do so, it could issue one or more series of preferred stock that
         could, depending on their terms, impede the comp letion of a merger, tender offer or other takeover attempt. Any decision by
         our board of directors to issue such preferred stock will be based on their judg ment as to the best interest of Endeavour and
         its stockholders.


            Special Meeting of Stockholders

               Our amended and restated bylaws provide that special meet ings of our stockholders can only be called by resolution of
         the board of directors or by the written request of stockholders owning a majority of the issued and outstanding capital stock
         entitled to vote.


            Classified Board of Directors

              Our bylaws provide that the members of our board of d irectors are div ided into three classes as nearly equal as possible.
         Each class is elected for a three-year term. At each annual meeting of stockholders, approximately one-third of the members
         of the board of directors are elected fo r a three-year term and the other directors remain in office until their three-year terms
         expire. Our amended and restated bylaws provide for one to fifteen directors (as determined by resolution of our board of
         directors). Ou r amended and restated bylaws also provide that any vacancies may be filled by a majority of the remaining
         directors, though less than a quorum, or by a sole remain ing director, and each director so elected shall hold office until his
         successor is elected at an annual or special meeting of the stockholders. These provisions may impede a stockholder fro m
         gaining control of the board of directors by removing incumbent directors or increasing the number of d irectors and
         simu ltaneously filling the vacancies or newly created directorships with its own nominees.

              Notwithstanding the foregoing, our amended and restated bylaws provide that the holders of two -thirds of our
         outstanding shares of stock entitled to vote may at any time p reemptorily terminate the term of office of all or any of the
         directors by vote at a meeting called for such purpose or by a written statement filed with our secretary or, in his or her
         absence, with any other officer.


         Li mitations on Liability and Indemnificati on of Officers and Directors

                Our amended and restated articles of incorporation provide that none of our officers or d irectors will be personally
         liab le to us or our stockholders for damages for a breach of their fiduciary duties as a director or officer, other than (i) for
         acts or omissions that involve intentional misconduct, fraud or knowing violat ion of law or (ii) the unlawful payment of a
         distribution. In addition, our amended and restated articles of incorporation and amended and restated bylaws provide that
         we will indemn ify our officers and directors and advance related costs and expenses incurred by our officers and directors to
         the fullest extent permitted by Nevada law. In addition, we also may enter into agreements with any officer or d irector, and
         may obtain insurance, indemnifying such officers and directors against certain liabilit ies incurred by them. Such provisions
         may have the effect of preventing changes in our management.


         Nevada Anti-Takeover Statutes

              The Co mbinations Statute, contained in Sections 78.411 through 78.444 (inclusive) of the NRS, and the Control Share
         Statute, contained in Sections 78.378 through 78.3793 (inclusive) of the NRS, may have the


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         effect of delay ing or making it more difficult to effect a change in control of Endeavour. The Co mb inations Statute generally
         prohibits a Nevada corporation with 200 or more stockholders of record fro m engaging in certain “co mbinations,” such as a
         merger or consolidation, with an “interested stockholder” for a period of three years after the date of the transaction in which
         the person became an interested stockholder, unless the combination or the transaction by which the person first became an
         interested stockholder is approved by the board of directors of the company before the person first became an interested
         stockholder. The purpose of the Co mbinations Statutes is to ensure that management and stockholders of a Nevada
         corporation are involved in any potential and material changes to the corporate ownership structure. A “combination” means:

               • any merger or consolidation;

               • any sale, lease, exchange, mortgage, pledge, transfer or other disposition of the corporation ’s assets having a total
                 market value equal to 10% or more of the total market value of all the assets of the corporation; or 5% or mo re of
                 the total market value of all outstanding shares of the corporation or representing 10% or more of the earning power
                 of the corporation; or

               • the issuance or transfer by the corporation of any shares of the corporation that have an aggregate market value
                 equal to 5% or more of the aggregate market value of all the outstanding shares of the corporation to shareholders
                 except under the exercise of warrants or rights to purchase shares offered, or a d ividend or distribution paid or made,
                 pro rata to all shareholders of the corporation.

               An “interested stockholder” generally means:

               • a person or group that owns 10% or mo re of a corporation’s outstanding voting securities; or

               • an affiliate or associate of the corporation that at any time during the past three years was the owner of 10% or more
                 of the corporation’s then outstanding voting securities, unless the acquisition of the 10% or larger percentage was
                 approved by the board of directors before the acquisition.

                If this approval is not obtained, then after the exp iration of the three-year period, the business combination may be
         consummated with the approval of the board of directors or a majority of the voting power held by disinterested stockholders
         or if the consideration to be paid by the interested stockholder is fair as provided in the statute.

               The Control Share Statute governs acquisitions of a controlling interest of certain publicly held co rporations. The
         purpose of the Control Share Statute, like the Co mbinations Statute, is to statutorily provide management a measure of
         involvement in connection with potential changes of control. The Control Share Statute will apply to us if we have 200 or
         more stockholders of record, at least 100 of who m have addresses in Nevada, unless the amended and restated articles of
         incorporation or amended and restated bylaws in effect on the tenth day after the acquisition of a controlling interest provide
         otherwise. These provisions provide generally that any person that acquires a “controlling interest” acquires voting rights in
         the control shares, as defined, only as conferred by the stockholders of the corporation at a special or annual meeting. If
         control shares are accorded full voting rights and the acquiring person has acquired at least a majority of all of the voting
         power, any stockholder of record who has not voted in favor of authorizing voting rights for the control shares is entitled t o
         demand payment for the fair value o f its shares. A person acquires a “controlling interest” whenever a person acquires shares
         of a subject corporation that, but for the application of the Control Share Statute, would enable that person to exercise:

               • one-fifth or mo re, but less than one-third;

               • one-third or more, but less than a majority; or

               • a majority or mo re, of all o f the voting power of the corporation in the elect ion of directors.

              Once an acquirer crosses any one of these thresholds, shares that it acquired in the transaction taking it over the
         threshold and within the 90 days immed iately preceding the date when the acquiring person acquired or offered to acquire a
         controlling interest become “control shares.”


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                                                            Descripti on of Warrants

              We may issue warrants for the purchase of our common stock. If we issue warrants, we may do so under one or more
         warrant agreements between us and a warrant agent that we will name in the prospectus supplement.

             The prospectus supplement relat ing to any warrants being offered will include specific terms relat ing to the offering.
         These terms will include some or all o f the following:

               • the title of the warrants;

               • the number of shares of common stock purchasable upon exercise of the warrants and the price at which such
                 number of shares of common stock may be purchased upon exercise of the warrants;

               • the exercise price of the warrants;

               • the aggregate number of warrants offered;

               • the price or prices at which each warrant will be issued;

               • the guarantors, if any, who will guarantee such warrants and the methods of determining such guarantors, if any;

               • the procedures for exercising the warrants;

               • dates or periods during which the warrants are exercisable; and

               • the exp iration date and any other material terms of the warrants.


         Exercise of Warrants

               Each warrant will entit le the holder of warrants to purchase for cash the amount of common stock, at the exercise price
         stated or determinable in the prospectus supplement for the warrants. Warrants may be exercised at any time up to the close
         of business on the expiration date shown in the prospectus supplement relating to the warrants, unless otherwise specified in
         the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will beco me
         void. Warrants may be exercised as described in the prospectus supplement relating to the warrants. When the warrant
         holder makes the payment and properly co mpletes and signs the warrant certificate at the corporate trust office of the warran t
         agent or any other office indicated in the prospectus supplement, we will, as soon as possible, forward the co mmon stock
         that the warrant holder has purchased. If the warrant holder exercises the warrant for less than all of the warrants represen ted
         by the warrant certificate, we will issue a new warrant certificate for the remaining warrants.


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                                                               Plan of Distri bution

             We may sell the offered securities in and outside the United States (1) through underwriters or dealers, (2) directly to
         purchasers, including our affiliates and stockholders, (3) through agents or (4) through a combination of any of these
         methods. The prospectus supplement will include the following in formation:

               • the terms of the offering;

               • the names of any underwriters or agents;

               • the name or names of any managing underwriter or underwriters;

               • the purchase price of the securities;

               • the estimated net proceeds to us from the sale of the securities;

               • any delayed delivery arrangements;

               • any underwriting discounts, commissions and other items constituting underwriters ’ co mpensation;

               • any discounts or concessions allowed o r reallowed or paid to dealers; and

               • any commissions paid to agents.


         Sale Through Underwriters or Dealers

               If underwriters are used in the sale, the underwriters will acquire the securities for their o wn account for resale to the
         public, either on a firm co mmit ment basis or a best efforts basis. The underwriters may resell the securities fro m time to ti me
         in one or more t ransactions, including negotiated transactions, at a fixed public offering price or at vary ing prices determined
         at the time of sale. Underwriters may offer securities to the public either through underwrit ing syndicates represented by on e
         or more managing underwriters or d irectly by one or mo re firms act ing as underwriters. Un less we inform you otherwise in
         the prospectus supplement, the obligations of the underwriters to purchase the securities will be subject to certain conditio ns.
         The underwriters may change fro m t ime to time any offering price and any discounts or concessions allowed or reallo wed or
         paid to dealers. Any discounts or commissions underwriters or dealers receive fro m us and any profit on their resale of the
         securities may be treated as underwrit ing discounts and commissions under the Securities Act. The aggregate maximu m
         compensation the underwriters will receive in connection with the sale of any securities under this prospectus and the
         registration statement of which it forms a part will not exceed 8% o f the gross proceeds fro m the sale.

              During and after an o ffering through underwriters, the underwriters may purchase and sell the securities in the open
         market. These transactions may include overallot ment and stabilizing transactions and purchases to cover syndicate short
         positions created in connection with the offering. The underwriters may also impose a penalty bid, wh ich means that selling
         concessions allowed to syndicate members or other broker -dealers for the offered securities sold for their account may be
         reclaimed by the syndicate if the offered securities are repurchased by the syndicate in stabilizing or covering transactions.
         These activities may stabilize, maintain or otherwise affect the market p rice o f the offered securit ies, which may be higher
         than the price that might otherwise prevail in the open market. If co mmenced, the underwriters may discontinue these
         activities at any time.

              If dealers are used, we will sell the securities to them as principals. The dealers may then resell those securities to the
         public at varying prices determined by the dealers at the time of resale. We will include in the prospectus supplement the
         names of the dealers and the terms of the transaction.


         Direct Sales and Sales Through Agents

              We may sell the securities directly. In this case, no underwriters or agents would be involved. We may also sell the
         securities through agents designated from time to time. In the prospectus supplement, we will name any agent involved in
         the offer or sale o f the offered securit ies, and we will describe any commissions
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         payable to the agent. Unless we inform you otherwise in the prospectus supplement, any agent will agree to use its
         reasonable best efforts to solicit purchases for the period of its appointment.

             We may sell the securities directly to institutional investors or others who may be deemed to be underwriters within the
         mean ing of the Securit ies Act with respect to any sale of securities. We will describe the terms of any such sales in the
         prospectus supplement.


         Deri vati ve and Other Transactions

               We may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third
         parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those
         derivatives, the third parties may sell securit ies covered by this prospectus and the applicable prospectus supplement,
         including in short sale transactions. If so, the third party may use securities pledged by us or borrowed fro m us or others t o
         settle those sales or to close out any related open borrowings of stock, and may use securities received fro m us in settlement
         of those derivatives to close out any related open borrowings of stock. We may also loan or p ledge securities covered by this
         prospectus and any applicable prospectus supplement to third part ies, who may sell the loaned securities or, in an event of
         default in the case of a pledge, sell the pledged securities pursuant to this prospectus and any applicable prospectus
         supplement (or a post-effective amend ment).


         Remarketing Arrangements

              Offered securities may also be offered and sold, if so indicated in the applicable prospectus supplement, in connection
         with a remarketing upon their purchase, in accordance with a redemption or repay ment pursuant to their terms, or otherwise,
         by one or more remarket ing firms, acting as principals for their own accounts or as agents for us. Any remarket ing firm will
         be identified and the terms of its agreements, if any, with us and its compensation will be described in the applicab le
         prospectus supplement. Remarketing firms may be deemed to be underwriters, as that term is defined in the Securities Act,
         in connection with the securities remarketed.


         Delayed Deli very Contracts

              If we so indicate in the prospectus supplement, we may authorize agents, underwriters or dealers to solicit offers fro m
         certain types of institutions to purchase securities fro m us at the public offering price under delayed delivery contracts. T hese
         contracts would provide for pay ment and delivery on a specified date in the future. The contracts would be subject only to
         those conditions described in the prospectus supplement. The prospectus supplement will describe the co mmission payable
         for solicitation of those contracts.


         General Informati on

              We may have agreements with the agents, dealers, underwriters and remarketing firms to indemn ify them against
         certain civ il liabilities, including liabilities under the Securit ies Act, or to contribute with respect to payments that the agents,
         dealers, underwriters or remarket ing firms may be required to make. Agents, dealers, underwriters and remarket ing firms
         may be customers of, engage in transactions with, or perform services for us in the ordinary course of their businesses.


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                                                                  Legal Matters

              In connection with particular offerings of debt securities, and if stated in the applicable prospectus supple ment, the
         validity of those debt securities may be passed upon for us by Vinson & Elkins L.L.P. Woodburn and Wedge, our Nevada
         counsel, has passed upon the validity of the common stock, preferred stock and warrants offered hereby.


                                                                      Experts

              The consolidated financial statements of Endeavour International Co rporation as of December 31, 2008 and 2007, for
         each of the years in the three-year period ended December 31, 2008, and management’s assessment of the effect iveness of
         internal control over financial reporting as of December 31, 2008 have been incorporated by reference herein in reliance
         upon the reports of KPM G LLP, independent registered public accounting firm, incorporated by reference herein, and upon
         the authority of said firm as experts in accounting and auditing. KPM G LLP ’s report with respect to the consolidated
         financial statements refers to changes in the Co mpany’s method of accounting and disclosures for fair value measurements
         and fair value reporting of financial assets and liabilities, and changes in accounting for uncertain tax positions.

             Certain info rmation incorporated by reference in this prospectus regarding estimated quantities of oil and gas reserves
         owned by us is based on estimates of the reserves prepared by or derived fro m estimates audited by Netherland, Sewell &
         Associates, Inc., independent petroleum engineers, and all such information has been so incorporated in reliance on the
         authority of that firm as experts regarding the matters contained in their report.


                                                    Where You Can Find More Informati on

              This prospectus, including any documents incorporated herein by reference, constitutes a part of a registration statement
         on Form S-3 that we filed with the SEC under the Securities Act. This prospectus does not contain all the informat ion set
         forth in the registration statement. You should refer to the registration statement and its related exhib its and schedules, and
         the documents incorporated herein by reference, for fu rther info rmation about our company and the securities offered in this
         prospectus. Statements contained in this prospectus concerning the provisions of any document are not necessarily co mp lete
         and, in each instance, reference is made to the copy of that document filed as an exh ibit to the registration statement or
         otherwise filed with the SEC, and each such statement is qualified by this reference. The reg istration statement and its
         exhibits and schedules, and the documents incorporated herein by reference, are on file at the offices of the SEC and may be
         inspected without charge.

              We file annual, quarterly, and current reports, pro xy statements and other informat ion with the SEC. You can read and
         copy any materials we file with the SEC at the SEC’s Public Reference Roo m at 100 F Street, N.E., Washington, D.C.
         20549. You can obtain information about the operation of the Public Reference Roo m by calling the SEC at
         1-800-SEC-0330. The SEC also maintains a website that contains informat ion we file electronically with the SEC, which
         you can access over the Internet at http://www.sec.gov .

              Our ho me page is located at http://www.endeavourcorp.com . Our annual reports on Form 10-K, our quarterly reports
         on Form 10-Q, current reports on Form 8-K and other filings with the SEC are availab le free of charge through our web site
         as soon as reasonably practicable after those reports or filings are electronically filed or furn ished to the SEC. Info rmation on
         our web site or any other web site is not incorporated by reference in th is prospectus and does not constitute a part of this
         prospectus.


                                              Incorporati on of Certai n Documents by Reference

              We are incorporating by reference in this prospectus informat ion we file with the SEC, which means that we are
         disclosing important information to you by referring you to those documents. The information we incorporate by reference is
         an important part of this prospectus, and later info rmation that we file with the


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         SEC automatically will update and supersede this information. We incorporate by reference the docu ments listed below and
         any future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, excluding any
         informat ion in those documents that is deemed by the rules of the SEC to be furnished not filed, until we close this offering:

               • our Annual Report on Form 10-K fo r the year ended December 31, 2008, including informat ion specifically
                 incorporated by reference fro m our Pro xy Statement for our Annual Meeting of Stockholders held on May 29, 2009;

               • our Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2009, June 30, 2009 and September 30,
                 2009;

               • our Current Reports on Form 8-K or Form 8-K/A filed on May 20, 2009, November 23, 2009 and January 11, 2010
                 (two reports) (excluding any info rmation furn ished pursuant to Item 2.02 or Item 7.01 of any such Current Report
                 on Form 8-K); and

               • the description of our co mmon stock contained in our registration statement on Form 8-A filed on June 10, 2004, as
                 amended by our amended registration statement on Form 8-A/A-1 filed on August 11, 2004, and including any other
                 amend ments or reports filed for the purpose of updating such description.

               These reports contain important information about us, our financial condition and our results of operations.

               All future documents filed pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act (excluding any
         informat ion furnished pursuant to Item 2.02 o r Item 7.01 on any Current Report on Form 8-K) after the date on which the
         registration statement that includes this prospectus was initially filed with the SEC (including all such documents we may
         file with the SEC after the date of the in itial registration statement and prior to the effectiveness of the registration statement)
         and until all offerings under this shelf registration statement are terminated shall be deemed to be incorporated in this
         prospectus by reference and to be a part hereof fro m the date of filing of such documents. Any statement contained herein, or
         in a document incorporated or deemed to be incorporated by reference herein, shall be deemed to be modified or superseded
         for purposes of this prospectus to the extent that a statement contained herein or in any 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 this prospectus.

              You may request a copy of these filings, which we will provide to you at no cost, by writ ing or telephoning us at the
         following address and telephone number:


                                                        Endeavour International Corporation
                                                          1001 Fannin Street, Suite 1600
                                                              Houston, Texas 77002
                                                                  (713) 307-8700
                                                          Attention: Corporate Secretary


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                               8,000,000 Shares
                                Common Stock




                    PRELIMINARY PROSPECTUS SUPPLEMENT
                                   March , 2011



                                       Citi
                                Canaccord Genuity
                             C. K. Cooper & Company
                              Global Hunter Securities
                             Rodman & Renshaw, LLC