DELTA PETROLEUM CORPORATION
 
                              2001 INCENTIVE PLAN
 
1.   Purpose of the Plan
 
     The purpose of this Delta Petroleum Corporation 2001 Incentive Plan
("Plan") is to create shareholder value. To do so, the Plan provides
incentives to selected employees and directors of the Company and its
Subsidiaries, and selected non-employee consultants and advisors to the
Company and its Subsidiaries, who contribute, and are expected to contribute,
materially to its success. The Plan also provides a means of rewarding
outstanding performance and enhances the interest of such persons in the
Company's success and development by providing them a proprietary interest in
the Company. Further, the Plan is designed to enhance the Company's ability to
maintain a competitive position in attracting and retaining qualified
personnel necessary for the success and development of the Company.
 
2.   Definitions
 
     As used in the Plan, the following definitions apply to the terms
indicated below:
 
     (a)  "Board of Directors" shall mean the Board of Directors of Delta
          Petroleum Corporation.
 
     (b)  "Cause," when used in connection with the termination of a
          Participant's employment with the Company, for purposes of the
          Plan, shall mean the termination of the Participant's employment
          by the Company on account of (i) the willful and continued failure
          by the Participant substantially to perform his duties and
          obligations (other than any such failure resulting from his
          incapacity due to physical or mental illness) or (ii) the willful
          engaging by the Participant in an act or acts which could
          reasonably be expected to cause injury to the Company.  For
          purposes of this Section 2(b), no act, or failure to act, on a
          Participant's part shall be considered "willful" unless done, or
          omitted to be done, by the Participant in bad faith and without
          reasonable belief that his action or omission was in the best
          interests of the Company.
 
     (c)  "Cash Bonus" shall mean an award of a bonus payable in cash
          pursuant to Section 13 hereof.
 
     (d)  "Change in Control" shall mean:
 
          (i)  the acquisition at any time by a"person" or "group" (as that
               term is used in Sections 13(d)and 14(d)(2) of the Exchange
               Act) (excluding, for this purpose, the Company or any
               Subsidiary or any employee benefit plan of the Company or
               any Subsidiary) of beneficial ownership (as defined in Rule
               13d-3 under the Exchange Act) directly or indirectly, of
               securities representing 20% or more of the combined voting
               power in the election of directors of the then-outstanding
               securities of the Company or any successor of the Company;
 
 
 
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          (ii) the termination of service as directors, for any reason
               other than death, disability or retirement from the Board of
               Directors, during any period of  two consecutive years or
               less, of individuals who at the  beginning of such period
               constituted a majority of the Board of Directors, unless the
               election of or nomination for election of each new director
               during such period was approved  by a vote of at least
               two-thirds of the directors still in office who were
               directors at the beginning of the period;
 
          (iii)     approval by the shareholders of the Company of any merger or
                    consolidation or statutory share exchange as a result of
                    which the Common Shares shall be changed, converted or
                    exchanged (other than a merger or share exchange with a
                    wholly-owned Subsidiary of the Company), or liquidation of
                    the Company, or any sale or disposition of 50% or more of
                    the assets or earning power of the Company;
 
          (iv) approval by the shareholders of the Company of any merger,
               consolidation or statutory share exchange to which the
               Company is a party as a result of which the persons who were
               shareholders of the Company immediately prior to the
               effective date of the merger, consolidation or statutory
               share exchange shall have beneficial ownership of less than
               50% of the combined voting power in the election of
               directors of the surviving corporation following the
               effective date of such merger, consolidation or statutory
               share exchange; or
 
          (v)  a determination by the Board of Directors, in its sole and
               absolute discretion, that a change in control has occurred.
 
     (e)  "Code" shall mean the Internal Revenue Code of 1986, as  amended
          from time to time.
 
     (f)  "Committee" shall mean the committee appointed by the Board of
          Directors from time to time to administer the Plan.
 
     (g)  "Common Shares" shall mean Delta Petroleum Corporation common
          shares, no par value per share.
 
     (h)  "Company" shall mean Delta Petroleum Corporation, a Colorado
          corporation, and each of its Subsidiaries.
 
     (i)  "Disability" shall mean a Participant's inability to engage in any
          substantial gainful activity by reason of any medically
          determinable physical or mental impairment which can be expected
          to result in death or which has lasted or can be expected to last
          for a continuous period of not less than twelve (12) months.
 
     (j)  "Exchange Act" shall mean the Securities Exchange Act of 1934, as
          amended.
 
 
 
 
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     (k)  The "Fair Market Value" of Common Shares with respect to any day
          shall be (i) the closing sales price on the immediately preceding
          business day of Common Shares as reported on the principal
          securities exchange on which Common Shares are then listed or
          admitted to trading, or (ii) if not so reported, the average of
          the closing bid and ask prices on the immediately preceding
          business day as reported on the National Association of Securities
          Dealers Automated Quotation System, or (iii) if not so reported,
          as furnished by any member of the National Association of
          Securities Dealers, Inc. selected by the Committee. In the event
          that the price of Common Shares shall not be so reported, the Fair
          Market Value of Common Shares shall be determined by the Committee
          in its absolute discretion.
 
     (l)  "Incentive Award" shall mean an Option, LSAR, Tandem SAR,
          Stand-Alone SAR, share of Phantom Stock, Stock Bonus or Cash Bonus
          granted pursuant to the terms of the Plan.
 
     (m)  "Incentive Stock Option" shall mean an Option which is an
          "incentive stock option" within the meaning of Section 422 of the
          Code and which is identified as an Incentive Stock Option in the
          agreement by which it is evidenced.
 
     (n)  "Issue Date" shall mean the date established by the Committee on
          which certificates representing shares of Restricted Stock shall
          be issued by Delta Petroleum Corporation pursuant to the terms of
          Section 10(d) hereof.
 
     (o)  "LSAR" shall mean a limited stock appreciation right which is
          granted pursuant to the provisions of Section 7 hereof and which
          relates to an Option. Each LSAR shall be exercisable only upon the
          occurrence of a Change in Control and only in the alternative to
          the exercise of its related Option.
 
     (p)  "Non-Employee Participant" shall mean a Participant who is not an
          employee of the Company.
 
     (q)  "Non-Qualified Stock Option" shall mean an Option which is not an
          Incentive Stock Option and which is identified as a Non-Qualified
          Stock Option in the agreement by which it is evidenced.
 
     (r)  "Option" shall mean an option to purchase Common Shares of Delta
          Petroleum Corporation granted pursuant to Section 6 hereof. Each
          Option shall be identified as either an Incentive Stock Option or
          a Non-Qualified Stock Option in the agreement by which it is
          evidenced.
 
     (s)  "Participant" shall mean a person who is eligible to participate
          in the Plan and to whom an Incentive Award is granted pursuant to
          the Plan, and, upon his death, his successors, heirs, executors
          and administrators, as the case may be.
 
     (t)  "Person" shall mean a "person," as such term is used in Sections
          13(d) and 14(d) of the Exchange Act.
 
 
 
 
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     (u)  "Phantom Stock" shall mean the right to receive in cash  the Fair
          Market Value of Common Shares of Delta Petroleum Corporation,
          which right is granted pursuant to Section 11 hereof and subject
          to the terms and conditions contained therein.
 
     (v)  "Plan" shall mean the Delta Petroleum Corporation 2001 Incentive
          Plan, as it may be amended from time to time.
 
     (w)  "Restricted Stock" shall mean a Common Share which is granted
          pursuant to the terms of Section 10 hereof and which is subject to
          the restrictions set forth in Section 10(c) hereof for so long as
          such restrictions continue to apply to such share.
 
     (x)  "Securities Act" shall mean the Securities Act of 1933, as
          amended.
 
     (y)  "Stand-Alone SAR" shall mean a stock appreciation right granted
          pursuant to Section 9 hereof which is not related to any Option.
 
     (z)  "Stock Bonus" shall mean a grant of a bonus payable in Common
          Shares pursuant to Section 12 hereof.
 
     (aa) "Subsidiary" shall mean any corporation in which at the time of
          reference Delta Petroleum Corporation owns, directly or
          indirectly, stock comprising more than fifty percent of the total
          combined voting power of all classes of stock of such corporation.
 
     (bb) "Tandem SAR" shall mean a stock appreciation right granted
          pursuant to Section 8 hereof which is related to an Option. Each
          Tandem SAR shall be exercisable only to the extent its related
          Option is exercisable and only in the alternative to the exercise
          of its related Option.
 
     (cc) "Vesting Date" shall mean the date established by the Committee on
          which a share of Restricted Stock or Phantom Stock may vest.
 
     (dd) "Delta Petroleum Corporation" shall mean Delta Petroleum
          Corporation, a Colorado corporation, and its successors.
 
3.   Stock Subject to the Plan
 
     Under the Plan, the Committee may grant to Participants (i) Options,
(ii) LSARs, (iii) Tandem SARs, (iv) Stand-Alone SARs, (v) shares of Restricted
Stock, (vi) shares of Phantom Stock, (vii) Stock Bonuses and (viii) Cash
Bonuses; provided, however, that grants under the Plan to non-employee
directors of the Company shall be made by the Board of Directors. When
referring to grants under the Plan to non-employee directors of the Company,
any reference in this Plan to the Committee shall be deemed to refer to the
Board of Directors.
 
 
     Subject to adjustment as provided in Section 14 hereof, the Committee
may grant Options, Stand-Alone SARs, shares of Restricted Stock, shares of
Phantom Stock and Stock Bonuses under the Plan with respect to a number of
Common Shares that in the aggregate does not exceed 550,000 shares.  The
 
 
 
 
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grant of an LSAR, Tandem SAR or Cash Bonus shall not reduce the number of
Common Shares with respect to which Options, Stand-Alone SARs, shares of
Restricted Stock, shares of Phantom Stock or Stock Bonuses may be granted
pursuant to the Plan.
 
     In the event that any outstanding Option or Stand-Alone SAR expires,
terminates or is canceled for any reason (other than pursuant to Paragraphs
7(b)(2) or 8(b)(3) hereof), the Common Shares subject to the unexercised
portion of such Option or Stand-Alone SAR shall again be available for grants
under the Plan. In the event that an outstanding Option is canceled pursuant
to Paragraphs 7(b)(2) or 8(b)(3) hereof by reason of the exercise of an LSAR
or a Tandem SAR, the Common Shares subject to the canceled portion of such
Option shall not again be available for grants under the Plan. In the event
that any shares of Restricted Stock or Phantom Stock, or any Common Shares
granted in a Stock Bonus are forfeited or canceled for any reason, such shares
shall again be available for grants under the Plan.
 
 
     Common Shares issued under the Plan may be either newly issued shares or
treasury shares, at the discretion of the Committee, and Delta Petroleum
Corporation hereby reserves 550,000 Common Shares for issuance pursuant to the
Plan.
 
 
4.   Administration of the Plan
 
     The Plan shall be administered by a Committee of the Board of Directors
consisting of two or more persons, each of whom shall be a "non-employee
director" within the meaning of Rule 16b-3(b)(3) promulgated under Section 16
of the Exchange Act. The Committee shall from time to time designate the
persons who shall be granted Incentive Awards and the amount and type of such
Incentive Awards, provided, however that any Incentive Awards granted to
non-employee directors of the Company shall be granted by the Board and not by
the Committee.  When referring to grants under the Plan to non-employee
directors of the Company, any reference in this Plan to the Committee shall be
deemed to refer to the Board of Directors.
 
     The Committee shall have full authority to administer the Plan,
including authority to interpret and construe any provision of the Plan and
the terms of any Incentive Award issued under it and to adopt such rules and
regulations for administering the Plan as it may deem necessary. Decisions of
the Committee shall be final and binding on all parties.
 
     The Committee may, in its absolute discretion (i) accelerate the date on
which any Option or Stand-Alone SAR granted under the Plan becomes
exercisable, (ii) accelerate the Vesting Date or Issue Date, or waive any
condition imposed pursuant to Section 10(b) hereof, with respect to any share
of Restricted Stock granted under the Plan and (iii) accelerate the Vesting
Date or waive any condition imposed pursuant to Section 11 hereof, with
respect to any share of Phantom Stock granted under the Plan.
 
     In addition, the Committee may, in its absolute discretion, grant
Incentive Awards to Participants on the condition that such Participants
surrender to the Committee for cancellation such other Incentive Awards
(including, without limitation, Incentive Awards with higher exercise prices)
as the Committee specifies. Notwithstanding Section 3 herein, prior to the
surrender of such other Incentive Awards, Incentive Awards granted pursuant to
the preceding sentence of this Section 4 shall not count against the limits
set forth in such Section 3.
 
 
 
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     Whether an authorized leave of absence, or absence in military or
government service, shall constitute termination of employment shall be
determined by the Committee.
 
     No member of the Committee shall be liable for any action, omission, or
determination relating to the Plan, and Delta Petroleum Corporation shall
indemnify and hold harmless each member of the Committee and each other
director or employee of the Company to whom any duty or power relating to the
administration or interpretation of the Plan has been delegated against any
cost or expense (including counsel fees) or liability (including any sum paid
in settlement of a claim with the approval of the Committee) arising out of
any action, omission or determination relating to the Plan, unless, in either
case, such action, omission or determination was taken or made by such member,
director or employee in bad faith and without reasonable belief that it was in
the best interests of the Company.
 
5.   Eligibility
 
     The persons who shall be eligible to receive Incentive Awards pursuant
to the Plan shall be such persons, including employees, officers, and
directors of the Company and non-employee consultants and advisors to the
Company, as the Committee shall select from time to time.  Non-employee
Directors of the Company may only participate in the Plan pursuant to
Paragraph 25 hereof.
 
6.   Options
 
     Subject to the provisions of the Plan, the Committee may grant Options,
which Options shall be evidenced by agreements in such form as the Committee
shall from time to time approve. Options shall comply with and be subject to
the following terms and conditions:
 
     (a)  Identification of Options
 
          All Options granted under the Plan that are Incentive Stock
          Options shall be clearly identified in the agreement evidencing
          such Options as Incentive Stock Options.  Any Options not so
          identified shall be deemed to be Non-Qualified Stock Options.
 
     (b)  Exercise Price
 
          The exercise price of any Non-Qualified Stock Option granted under
          the Plan shall be such price as the Committee shall determine on
          the date on which such Non-Qualified Stock Option is granted;
          provided, that such price may not be less than the minimum price
          required by applicable law. The exercise price of any Incentive
          Stock Option granted under the Plan shall be not less than 100% of
          the Fair Market Value of Common Shares on the date on which such
          Incentive Stock Option is granted.
 
     (c)  Term and Exercise of Option
 
          (1)  Each Option shall be exercisable on such date or dates,
               during such period and for such number of Common Shares as
               shall be determined by the Committee on the day on which
 
 
 
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               such Option is granted and set forth in the Option agreement
               with respect to such Option; provided, however, that no
               Option shall be exercisable after the expiration of ten
               years from the date such Option was granted; and, provided,
               further, that each Option shall be subject to earlier
               termination, expiration or cancellation as provided in the
               Plan.
 
          (2)  Each Option shall be exercisable in whole or in part;
               provided, that no partial exercise of an Option shall be for
               an aggregate exercise price of less than $1,000, unless such
               partial exercise is for the last remaining unexercised
               portion of such Option. The partial exercise of an Option
               shall not cause the expiration, termination or cancellation
               of the remaining portion thereof. Upon the partial exercise
               of an Option, the agreements evidencing such Option and any
               related LSARs and Tandem SARs shall be returned to the
               Participant exercising such Option together with the
               delivery of the certificates described in Section 6(c)(5)
               hereof.
 
          (3)  An Option shall be exercised by delivering notice to Delta
               Petroleum Corporation's principal office, to the attention
               of its Secretary, no less than one business day in advance
               of the effective date of the proposed exercise. Such notice
               shall be accompanied by the agreements evidencing the Option
               and any related LSARs and Tandem SARs, shall specify the
               number of Common Shares with respect to which the Option is
               being exercised and the effective date of the proposed
               exercise and shall be signed by the Participant. The
               Participant may withdraw such notice at any time prior to
               the close of business on the business day immediately
               preceding the effective date of the proposed exercise, in
               which case such agreements shall be returned to him. Payment
               for Common Shares purchased upon the exercise of an Option
               shall be made on the effective date of such exercise either
               (i) in cash, by certified check, bank cashier's check or
               wire transfer or (ii) subject to the approval of the
               Committee, in Common Shares owned by the Participant and
               valued at their Fair Market Value on the effective date of
               such exercise, or partly in Common Shares with the balance
               in cash, by certified check, bank cashier's check or wire
               transfer. Any payment in Common Shares shall be effected by
               the delivery of such shares to the Secretary of Delta
               Petroleum Corporation, duly endorsed in blank or accompanied
               by stock powers duly executed in blank, together with any
               other documents and evidences as the Secretary of Delta
               Petroleum Corporation shall require from time to time.  In
               addition, at the time of grant the Committee may provide
               that an Option may be exercised in a "cashless" transaction
               in which the holder may surrender all or a portion of the
               Option and receive the number of shares of Common Shares
               equal in value to the Fair Market Value per share at the
               date of surrender less the exercise price per share of the
               Option, multiplied by the number of shares which may be
               purchased under the Option, or portion thereof, being
               surrendered.
 
 
 
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          (4)  Any Option granted under the Plan may be exercised by a
               broker-dealer acting on behalf of a Participant if (i) the
               broker-dealer has received from the Participant or the
               Company a fully-and-duly-endorsed agreement evidencing such
               Option and instructions signed by the Participant requesting
               Delta Petroleum Corporation to deliver the Common Shares
               subject to such Option to the broker-dealer on behalf of the
               Participant and specifying the account into which such
               shares should be deposited, (ii) adequate provision has been
               made with respect to the payment of any withholding taxes
               due upon such exercise and (iii) the broker-dealer and the
               Participant have otherwise complied with Section 220.3(e)(4)
               of Regulation T, 12 CFR Part 220.
 
          (5)  Certificates for Common Shares purchased upon the exercise
               of an Option shall be issued in the name of the Participant,
               or such Participant's written designee,  and delivered to
               the Participant or designee as soon as practicable following
               the effective date on which the Option is exercised.
 
          (6)  Except as specifically set forth in the agreement evidencing
               Options granted under the Plan, Options shall be assignable
               and transferable provided, however, that the Company shall
               not be under an obligation as provided in Paragraph 6(c)(7)
               below to include the shares underlying such transferred or
               assigned options in any registration statement except upon
               death or pursuant to a qualified domestic relations order.
 
          (7)  The Company, at the Company's expense, shall file and
               maintain a registration statement on the appropriate form
               with the Securities and Exchange Commission covering shares
               underlying all options granted hereunder except as set forth
               in Paragraph 6(c)(6) above.  The expiration date of any
               option expiring prior to 90 days before the effective date
               of a registration statement covering said option shall be
               extended until a date ninety (90) days following the
               effective date of said registration statement.
 
     (d)  Limitations on Grant of Incentive Stock Options
 
          (1)  The aggregate Fair Market Value of Common Shares with
               respect to which "incentive stock options" (within the
               meaning of Section 422 of the Code) are exercisable for the
               first time by a Participant during any calendar year under
               the Plan and any other stock option plan of the Company (or
               any "subsidiary" of Delta Petroleum Corporation as such term
               is defined in Section 425 of the Code) shall not exceed
               $100,000. Such Fair Market Value shall be determined as of
               the date on which each such incentive stock option is
               granted. In the event that the aggregate Fair Market Value
               of Common Shares with respect to such incentive stock
               options exceeds $100,000, then Incentive Stock Options
               granted hereunder to such Participant shall, to the extent
               and in the order required by Regulations promulgated under
               the Code (or any other authority having the force of
               Regulations), automatically be deemed to be Non-Qualified
 
 
 
<PAGE>
               Stock Options, but all other terms and provisions of such
               Incentive Stock Options shall remain unchanged. In the
               absence of such Regulations (and authority), or in the event
               such Regulations (or authority) require or permit a
               designation of the options which shall cease to constitute
               incentive stock options, Incentive Stock Options shall, to
               the extent of such excess and in the order in which they
               were granted, automatically be deemed to be Non-Qualified
               Stock Options, but all other terms and provisions of such
               Incentive Stock Options shall remain unchanged.
 
            (2)     No Incentive Stock Option may be granted to an individual
                    if, at the time of the proposed grant, such individual owns
                    stock possessing more than ten percent of the total combined
                    voting power of all classes of stock of Delta Petroleum
                    Corporation or any of its "subsidiaries" (within the meaning
                    of Section 425 of the Code), unless (i) the exercise price
                    of such Incentive Stock Option is at least one hundred and
                    ten percent of the Fair Market Value of a Common Share at
                    the time such Incentive Stock Option is granted and (ii)
                    such Incentive Stock Option is not exercisable after the
                    expiration of five years from the date such Incentive Stock
                    Option is granted.
 
     (e)  Effect of Termination of Employment
 
          (1)  Except as may be specifically set forth in the agreement
               evidencing an Option, in the event that the employment of a
               Participant with the Company shall terminate for any reason
               Options granted to such Participant, to the extent that they
               were exercisable at the time of such termination, shall
               remain exercisable in accordance with their terms.
 
          (2)  In the event that a Non-Employee Participant ceases to
               provide services to the Company, all Options granted to such
               Non-Employee Participant shall remain exercisable in
               accordance with their terms.
 
     (f)  Acceleration of Exercise Date Upon Change in Control
 
          Upon the occurrence of a Change in Control, each Option granted
          under the Plan and outstanding at such time shall become fully and
          immediately exercisable and shall remain exercisable until its
          expiration, termination or cancellation pursuant to the terms of
          the Plan.
 
7.   Limited Stock Appreciation Rights
 
     The Committee may grant in connection with any Option granted hereunder
one or more LSARs relating to a number of Common Shares equal to or less than
the number of Common Shares subject to the related Option. An LSAR may be
granted at the same time as, or subsequent to the time that, its related
Option is granted. Each LSAR shall be evidenced by an agreement in such form
as the Committee shall from time to time approve. Each LSAR granted hereunder
shall be subject to the following terms and conditions:
 
 
 
<PAGE>
     (a)  Benefit Upon Exercise
 
          (1)  The exercise of an LSAR relating to a Non-Qualified Stock
               Option with respect to any number of Common Shares shall
               entitle the Participant to a cash payment, for each such
               share, equal to the excess of (i) the greater of (A) the
               highest price per Common Share paid in the Change in Control
               in connection with which such LSAR became exercisable and
               (B) the Fair Market Value of a Common Share on the date of
               such Change in Control over (ii) the exercise price of the
               related Option. Such payment shall be paid as soon as
               practical, but in no event later than the expiration of five
               business days, after the effective date of such exercise.
 
          (2)  The exercise of an LSAR relating to an Incentive Stock
               Option with respect to any number of Common Shares shall
               entitle the Participant to a cash payment, for each such
               share, equal to the excess of (i) the Fair Market Value of a
               Common Share on the effective date of such exercise over
               (ii) the exercise price of the related Option. Such payment
               shall be paid as soon as practical, but in no event later
               than the expiration of five business days, after the
               effective date of such exercise.
 
     (b)  Term and Exercise of LSARs
 
          (1)  An LSAR shall be exercisable only during the period
               commencing on the first day following the occurrence of a
               Change in Control and terminating on the expiration of sixty
               days after such date. Notwithstanding the preceding sentence
               of this Section 7(b), in the event that an LSAR held by any
               Participant who is or may be subject to the provisions of
               Section 16(b) of the Exchange Act becomes exercisable prior
               to the expiration of six months following the date on which
               it is granted, then the LSAR shall also be exercisable
               during the period commencing on the first day immediately
               following the expiration of such six month period and
               terminating on the expiration of sixty days following such
               date. Notwithstanding anything else herein, an LSAR relating
               to an Incentive Stock Option may be exercised with respect
               to a Common Share only if the Fair Market Value of such
               share on the effective date of such exercise exceeds the
               exercise price relating to such share. Notwithstanding
               anything else herein, an LSAR may be exercised only if and
               to the extent that the Option to which it relates is
               exercisable.
 
          (2)  The exercise of an LSAR with respect to a number of Common
               Shares shall cause the immediate and automatic cancellation
               of the Option to which it relates with respect to an equal
               number of shares. The exercise of an Option, or the
               cancellation, termination or expiration of an Option (other
               than pursuant to this Paragraph (2)), with respect to a
               number of Common Shares, shall cause the cancellation of the
               LSAR related to it with respect to an equal number of
               shares.
 
 
 
<PAGE>
          (3)  Each LSAR shall be exercisable in whole or in part;
               provided, that no partial exercise of an LSAR shall be for
               an aggregate exercise price of less than $1,000, unless such
               partial exercise is for the last remaining unexercised
               portion of such LSAR. The partial exercise of an LSAR shall
               not cause the expiration, termination or cancellation of the
               remaining portion thereof. Upon the partial exercise of an
               LSAR, the agreements evidencing the LSAR, the related Option
               and any Tandem SARs related to such Option shall be returned
               to the Participant exercising such LSAR together with the
               payment described in Paragraph 7(a)(1) or (2) hereof, as
               applicable.
 
          (4)  Except as specifically set forth in the agreements relating
               thereto, each LSAR and any related Options shall be
               assignable and transferable.
 
          (5)  An LSAR shall be exercised by delivering notice to Delta
               Petroleum Corporation's principal office, to the attention
               of its Secretary, no less than one business day in advance
               of the effective date of the proposed exercise. Such notice
               shall be accompanied by the applicable agreements evidencing
               the LSAR, the related Option and any Tandem SARs relating to
               such Option, shall specify the number of Common Shares with
               respect to which the LSAR is being exercised and the
               effective date of the proposed exercise and shall be signed
               by the Participant. The Participant may withdraw such notice
               at any time prior to the close of business on the business
               day immediately preceding the effective date of the proposed
               exercise, in which case such agreements shall be returned to
               him.
 
8.   Tandem Stock Appreciation Rights
 
     The Committee may grant in connection with any Option granted hereunder
one or more Tandem SARs relating to a number of Common Shares equal to or less
than the number of Common Shares subject to the related Option. A Tandem SAR
may be granted at the same time as, or subsequent to the time that, its
related Option is granted. Each Tandem SAR shall be evidenced by an agreement
in such form as the Committee shall from time to time approve. Tandem SARs
shall comply with and be subject to the following terms and conditions:
 
        (a)    Benefit Upon Exercise
 
          The exercise of a Tandem SAR with respect to any number of Common
          Shares shall entitle a Participant to a cash payment, for each
          such share, equal to the excess of (i) the Fair Market Value of a
          Common Share on the effective date of such exercise over (ii) the
          exercise price of the related Option. Such payment shall be paid
          as soon as practical, but in no event later than the expiration of
          five business days, after the effective date of such exercise.
 
     (b)  Term and Exercise of Tandem SAR
 
          (1)  A Tandem SAR shall be exercisable at the same time and to
               the same extent (on a proportional basis, with any
 
 
 
<PAGE>
               fractional amount being rounded down to the immediately
               preceding whole number) as its related Option.
               Notwithstanding the first sentence of this Paragraph
               8(b)(1), (i) a Tandem SAR shall not be exercisable at any
               time that an LSAR related to the Option to which the Tandem
               SAR is related is exercisable and (ii) a Tandem SAR relating
               to an Incentive Stock Option may be exercised with respect
               to a Common Share only if the Fair Market Value of such
               share on the effective date of such exercise exceeds the
               exercise price relating to such share.
 
          (2)  Notwithstanding the first sentence of Paragraph 8(b)(1)
               hereof, the Committee may, in its absolute discretion, grant
               one or more Tandem SARs which shall not become exercisable
               unless and until the Participant to whom such Tandem SAR is
               granted is, in the determination of the Committee, subject
               to Section 16(b) of the Exchange Act and which shall cease
               to be exercisable if and at the time that the Participant
               ceases, in the determination of the Committee, to be subject
               to such Section 16(b).
 
          (3)  The exercise of a Tandem SAR with respect to a number of
               Common Shares shall cause the immediate and automatic
               cancellation of its related Option with respect to an equal
               number of shares. The exercise of an Option, or the
               cancellation, termination or expiration of an Option (other
               than pursuant to this Paragraph (3)), with respect to a
               number of Common Shares shall cause the automatic and
               immediate cancellation of its related Tandem SARs to the
               extent that the number of Common Shares subject to such
               Option after such exercise, cancellation, termination or
               expiration is less than the number of shares subject to such
               Tandem SARs. Such Tandem SARs shall be canceled in the order
               in which they became exercisable.
 
          (4)  Each Tandem SAR shall be exercisable in whole or in part;
               provided, that no partial exercise of a Tandem SAR shall be
               for an aggregate exercise price of less than $1,000, unless
               such partial exercise is for the last remaining unexercised
               portion of such Tandem SAR. The partial exercise of a Tandem
               SAR shall not cause the expiration, termination or
               cancellation of the remaining portion thereof. Upon the
               partial exercise of a Tandem SAR, the agreements evidencing
               such Tandem SAR, its related Option and LSARs relating to
               such Option shall be returned to the Participant exercising
               such Tandem SAR together with the payment described in
               Section 8(a) hereof.
 
          (5)  Except as specifically set forth in the agreements relating
               thereto, each Tandem SAR and the related Option shall be
               assignable and transferable.
 
          (6)  A Tandem SAR shall be exercised by delivering notice to
               Delta Petroleum Corporation's principal office, to the
               attention of its Secretary, no less than one business day in
 
 
 
<PAGE>
               advance of the effective date of the proposed exercise. Such
               notice shall be accompanied by the applicable agreements
               evidencing the Tandem SAR, its related Option and any LSARs
               related to such Option, shall specify the number of Common
               Shares with respect to which the Tandem SAR is being
               exercised and the effective date of the proposed exercise
               and shall be signed by the Participant. The Participant may
               withdraw such notice at any time prior to the close of
               business on the business day immediately preceding the
               effective date of the proposed exercise, in which case such
               agreements shall be returned to him.
 
9.   Stand-Alone Stock Appreciation Rights
 
     Subject to the provisions of the Plan, the Committee may grant
Stand-Alone SARs, which Stand-Alone SARs shall be evidenced by agreements in
such form as the Committee shall from time to time approve. Stand-Alone SARs
shall comply with and be subject to the following terms and conditions:
 
     (a)  Exercise Price
 
          The exercise price of any Stand-Alone SAR granted under the Plan
          shall be determined by the Committee at the time of the grant of
          such Stand-Alone SAR.
 
     (b)  Benefit Upon Exercise
 
          The exercise of a Stand-Alone SAR with respect to any number of
          Common Shares prior to the occurrence of a Change in Control shall
          entitle a Participant to a cash payment, for each such share,
          equal to the excess of (i) the Fair Market Value of a Common Share
          on the exercise date over (ii) the exercise price of the
          Stand-Alone SAR. The exercise of a Stand-Alone SAR with respect to
          any number of Common Shares upon or after the occurrence of a
          Change in Control shall entitle a Participant to a cash payment,
          for each such share, equal to the excess of (i) the greater of (A)
          the highest price per Common Share paid in connection with such
          Change in Control and (B) the Fair Market Value of a Common Share
          on the date of such Change in Control over (ii) the exercise price
          of the Stand-Alone SAR. Such payments shall be paid as soon as
          practical, but in no event later than five business days, after
          the effective date of the exercise.
 
     (c)  Term and Exercise of Stand-Alone SARs
 
          (1)  Each Stand-Alone SAR shall be exercisable on such date or
               dates, during such period and for such number of Common
               Shares as shall be determined by the Committee and set forth
               in the Stand-Alone SAR agreement with respect to such
               Stand-Alone SAR; provided, however, that no Stand-Alone SAR
               shall be exercisable after the expiration of ten years from
               the date such Stand-Alone SAR was granted; and, provided,
               further, that each Stand-Alone SAR shall be subject to
               earlier termination, expiration or cancellation as provided
               in the Plan.
 
 
 
<PAGE>
          (2)  Each Stand-Alone SAR may be exercised in whole or in part;
               provided, that no partial exercise of a Stand-Alone SAR
               shall be for an aggregate exercise price of less than
               $1,000, unless such partial exercise is for the last
               remaining unexercised portion of such Stand-Alone SAR. The
               partial exercise of a Stand-Alone SAR shall not cause the
               expiration, termination or cancellation of the remaining
               portion thereof. Upon the partial exercise of a Stand-Alone
               SAR, the agreement evidencing such Stand-Alone SAR shall be
               returned to the Participant exercising such Stand-Alone SAR
               together with the payment described in Section 9(b) hereof.
 
          (3)  A Stand-Alone SAR shall be exercised by delivering notice to
               Delta Petroleum Corporation's principal office, to the
               attention of its Secretary, no less than one business day in
               advance of the effective date of the proposed exercise. Such
               notice shall be accompanied by the applicable agreement
               evidencing the Stand-Alone SAR, shall specify the number of
               Common Shares with respect to which the Stand-Alone SAR is
               being exercised and the effective date of the proposed
               exercise and shall be signed by the Participant. The
               Participant may withdraw such notice at any time prior to
               the close of business on the business day immediately
               preceding the effective date of the proposed exercise, in
               which case the agreement evidencing the Stand-Alone SAR
               shall be returned to him.
 
          (4)  Except as specifically set forth in the agreements relating
               thereto, each Stand-Alone SAR shall be assignable and
               transferable.
 
     (d)  Effect of Termination of Employment
 
          (1)  In the event that the employment of a Participant with the
               Company shall terminate for any reason Stand-Alone SARs
               granted to such Participant, to the extent that they were
               exercisable at the time of such termination, shall remain
               exercisable in accordance with their terms.
 
          (2)  In the event that a Non-Employee Participant ceases to
               provide services to the Company, all Stand-Alone SARs
               granted to such Non-Employee Participant shall remain
               exercisable in accordance with their terms.
 
     (e)  Acceleration of Exercise Date Upon Change in Control
 
          Upon the occurrence of a Change in Control, each Stand-Alone SAR
          granted under the Plan and outstanding at such time shall become
          fully and immediately exercisable and shall remain exercisable
          until its expiration, termination or cancellation pursuant to the
          terms of the Plan.
 
 
 
 
 
<PAGE>
10.  Restricted Stock
 
     Subject to the provisions of the Plan, the Committee may grant shares of
Restricted Stock. Each grant of shares of Restricted Stock shall be evidenced
by an agreement in such form as the Committee shall from time to time approve.
Each grant of shares of Restricted Stock shall comply with and be subject to
the following terms and conditions:
 
     (a)  Issue Date and Vesting Date
 
          At the time of the grant of shares of Restricted Stock, the
          Committee shall establish an Issue Date or Issue Dates and a
          Vesting Date or Vesting Dates with respect to such shares. The
          Committee may divide such shares into classes and assign a
          different Issue Date and/or Vesting Date for each class. Except as
          provided in Sections 10(c) and 10(f) hereof, upon the occurrence
          of the Issue Date with respect to a share of Restricted Stock, a
          share of Restricted Stock shall be issued in accordance with the
          provisions of Section 10(d) hereof. Provided that all conditions
          to the vesting of a share of Restricted Stock imposed pursuant to
          Section 10(b) hereof are satisfied, and except as provided in
          Sections 10(c) and 10(f) hereof, upon the occurrence of the
          Vesting Date with respect to a share of Restricted Stock, such
          share shall vest and the restrictions of Section 10(c) hereof
          shall cease to apply to such share.
 
     (b)  Conditions to Vesting
 
          At the time of the grant of shares of Restricted Stock, the
          Committee may impose such restrictions or conditions, not
          inconsistent with the provisions hereof, to the vesting of such
          shares as it, in its absolute discretion, deems appropriate. By
          way of example and not by way of limitation, the Committee may
          require, as a condition to the vesting of any class or classes of
          shares of Restricted Stock, that the Participant or the Company
          achieve certain performance criteria, such criteria to be
          specified by the Committee at the time of the grant of such
          shares.
 
     (c)  Restrictions on Transfer Prior to Vesting
 
          Prior to the vesting of a share of Restricted Stock, no transfer
          of a Participant's rights with respect to such shares, whether
          voluntary or involuntary, by operation of law or otherwise, shall
          vest the transferee with any interest or right in or with respect
          to such share, but immediately upon any attempt to transfer such
          rights, such share, and all of the rights related thereto, shall
          be forfeited by the Participant and the transfer shall be of no
          force or effect.
 
     (d)  Issuance of Certificates
 
          (1)  Except as provided in Sections 10(c) or 10(f) hereof,
               reasonably promptly after the Issue Date with respect to
               shares of Restricted Stock, Delta Petroleum Corporation
 
 
 
<PAGE>
               shall cause to be issued a stock certificate, registered in
               the name of the Participant to whom such shares were
               granted, evidencing such shares; provided, that Delta
               Petroleum Corporation shall not cause to be issued such a
               stock certificate unless it has received a stock power duly
               endorsed in blank with respect to such shares. Each such
               stock certificate shall bear the following legend:
 
                    "The transferability of this certificate and the
                    shares of stock represented hereby is subject to the
                    restrictions, terms and conditions (including
                    forfeiture and restrictions against transfer)
                    contained in the Delta Petroleum Corporation 2001
                    Incentive Plan and an Agreement entered into between
                    the registered owner of such shares and Delta
                    Petroleum Corporation.  A copy of the Plan and
                    Agreement is on file in the office of the Secretary of
                    Delta Petroleum Corporation Such legend shall not be
                    removed from the certificate evidencing such shares
                    until such shares vest pursuant to the terms hereof."
 
          (2)  Each certificate issued pursuant to Paragraph 10(d)(1)
               hereof, together with the stock powers relating to the
               shares of Restricted Stock evidenced by such certificate,
               shall be deposited by the Company with a custodian
               designated by the Company. The Company shall cause such
               custodian to issue to the Participant a receipt evidencing
               the certificates held by it which are registered in the name
               of the Participant.
 
     (e)  Consequences Upon Vesting
 
          Upon the vesting of a share of Restricted Stock pursuant to the
          terms hereof, the restrictions of Section 10(c) hereof shall cease
          to apply to such share. Reasonably promptly after a share of
          Restricted Stock vests pursuant to the terms hereof, Delta
          Petroleum Corporation shall cause to be issued and delivered to
          the Participant to whom such shares were granted, a certificate
          evidencing such share, free of the legend set forth in Paragraph
          10(d)(1) hereof, together with any other property of the
          Participant held by the custodian pursuant to Section 14(b)
          hereof.
 
     (f)  Effect of Termination of Employment
 
          (1)  In the event that the employment of a Participant with the
               Company shall terminate for any reason other than Cause
               prior to the vesting of shares of Restricted Stock granted
               to such Participant, a proportion of such shares (up to
               100%), to the extent not forfeited or canceled on or prior
               to such termination pursuant to any provision hereof, shall
               vest on the date of such termination. The proportion
               referred to in the preceding sentence shall be determined by
               the Committee at the time of the grant of such shares of
               Restricted Stock and may be based on the achievement of any
               conditions imposed by the Committee with respect to such
               shares pursuant to Section 10(b). Such proportion may be
               equal to zero.
 
 
<PAGE>
           (2)      In the event of the termination of a Participant's
                    employment for Cause, all shares of Restricted Stock granted
                    to such Participant which have not vested as of the date of
                    such termination shall immediately be forfeited.
 
            (3)     In the event that a Non-Employee Participant ceases to
                    provide services to the Company, all shares of
                    Restricted Stock granted to such Non-Employee
                    Participant shall vest in accordance with the terms of
                    the grant.
 
       (g)     Effect of Change in Control
 
          Upon the occurrence of a Change in Control, all shares of
          Restricted Stock which have not theretofore vested (including
          those with respect to which the Issue Date has not yet occurred),
          or been canceled or forfeited pursuant to any provision hereof,
          shall immediately vest.
 
     (h)  Registration of Restricted Stock
 
          The Company, at the Company's expense, shall file and maintain a
          registration statement on the appropriate form with the Securities
          and Exchange Commission covering the restricted stock granted
          hereunder after it has vested.
 
11.  Phantom Stock
 
     Subject to the provisions of the Plan, the Committee may grant shares of
Phantom Stock. Each grant of shares of Phantom Stock shall be evidenced by an
agreement in such form as the Committee shall from time to time approve. Each
grant of shares of Phantom Stock shall comply with and be subject to the
following terms and conditions:
 
     (a)  Vesting Date
 
          At the time of the grant of shares of Phantom Stock, the Committee
          shall establish a Vesting Date or Vesting Dates with respect to
          such shares. The Committee may divide such shares into classes and
          assign a different Vesting Date for each class. Provided that all
          conditions to the vesting of a share of Phantom Stock imposed
          pursuant to Section 11(c) hereof are satisfied, and except as
          provided in Section 11(d) hereof, upon the occurrence of the
          Vesting Date with respect to a share of Phantom Stock, such share
          shall vest.
 
     (b)  Benefit Upon Vesting
 
          Upon the vesting of a share of Phantom Stock, a Participant shall
          be entitled to receive in cash, within 30 days of the date on
          which such share vests, an amount in cash in a lump sum equal to
          the sum of (i) the Fair Market Value of a Common Share of the
          Company on the date on which such share of Phantom Stock vests and
          (ii) the aggregate amount of cash dividends paid with respect to a
          Common Share of the Company during the period commencing on the
          date on which the share of Phantom Stock was granted and
          terminating on the date on which such share vests.
 
 
<PAGE>
     (c)  Conditions to Vesting
 
          At the time of the grant of shares of Phantom Stock, the Committee
          may impose such restrictions or conditions, not inconsistent with
          the provisions hereof, to the vesting of such shares as it, in its
          absolute discretion, deems appropriate. By way of example and not
          by way of limitation, the Committee may require, as a condition to
          the vesting of any class or classes of shares of Phantom Stock,
          that the Participant or the Company achieve certain performance
          criteria, such criteria to be specified by the Committee at the
          time of the grant of such shares.
 
     (d)  Effect of Termination of Employment
 
          (1)  In the event that the employment of a Participant with the
               Company shall terminate for any reason other than Cause
               prior to the vesting of shares of Phantom Stock granted to
               such Participant, a proportion of such shares (up to 100%),
               to the extent not forfeited or canceled on or prior to such
               termination pursuant to any provision hereof, shall vest on
               the date of such termination. The proportion referred to in
               the preceding sentence shall be determined by the Committee
               at the time of the grant of such shares of Phantom Stock and
               may be based on the achievement of any conditions imposed by
               the Committee with respect to such shares pursuant to
               Section 11(c). Such proportion may be equal to zero.
 
          (2)  In the event of the termination of a Participant's
               employment for Cause, all shares of Phantom Stock granted to
               such Participant which have not vested as of the date of
               such termination shall immediately be forfeited.
 
          (3)  In the event that a Non-Employee Participant ceases to
               provide services to the Company, all shares of Phantom Stock
               granted to such Non-Employee Participant shall vest in
               accordance with the terms of the grant.
 
     (e)  Effect of Change in Control
 
          Upon the occurrence of a Change in Control, all shares of Phantom
          Stock which have not theretofore vested, or been canceled or
          forfeited pursuant to any provision hereof, shall immediately
          vest.
 
12.  Stock Bonuses
 
     Subject to the provisions of the Plan, the Committee may grant Stock
Bonuses in such amounts as it shall determine from time to time. A Stock Bonus
shall be paid at such time and subject to such conditions as the Committee
shall determine at the time of the grant of such Stock Bonus. Certificates for
Common Shares granted as a Stock Bonus shall be issued in the name of the
Participant to whom such grant was made and delivered to such Participant as
soon as practicable after the date on which such Stock Bonus is required to be
paid.
 
 
 
 
<PAGE>
13.  Cash Bonuses
 
     Subject to the provisions of the Plan, the Committee may grant, in
connection with any grant of Restricted Stock or Stock Bonus or at any time
thereafter, a cash bonus, payable promptly after the date on which the
Participant is required to recognize income for federal income tax purposes in
connection with such Restricted Stock or Stock Bonus, in such amounts as the
Committee shall determine from time to time; provided however, that in no
event shall the amount of a Cash Bonus exceed 50% of the Fair Market Value of
the related shares of Restricted Stock or Stock Bonus on such date. A Cash
Bonus shall be subject to such conditions as the Committee shall determine at
the time of the grant of such Cash Bonus.
 
14.  Adjustment Upon Changes in Common Shares
 
     (a)  Shares Available for Grants
 
          In the event of any change in the number of Common Shares
          outstanding by reason of any stock dividend or split,
          recapitalization, merger, consolidation, combination or exchange
          of shares or similar corporate change, the maximum aggregate
          number of Common Shares with respect to which the Committee may
          grant Options, Stand-Alone SARs, shares of Restricted Stock,
          shares of Phantom Stock and Stock Bonuses shall be appropriately
          adjusted by the Committee. In the event of any change in the
          number of Common Shares outstanding by reason of any other event
          or transaction, the Committee may, but need not, make such
          adjustments in the number and class of Common Shares with respect
          to which Options, Stand-Alone SARs, shares of Restricted Stock,
          shares of Phantom Stock and Stock Bonuses may be granted as the
          Committee may deem appropriate.
 
     (b)  Outstanding Restricted Stock and Phantom Stock
 
          Unless the Committee in its absolute discretion otherwise
          determines, any securities or other property (including dividends
          paid in cash) received by a Participant with respect to a share of
          Restricted Stock, the Issue Date with respect to which occurs
          prior to such event, but which has not vested as of the date of
          such event, as the result of any dividend, stock split,
          recapitalization, merger, consolidation, combination, exchange of
          shares or otherwise, will not vest until such share of Restricted
          Stock vests, and shall be promptly deposited with the custodian
          designated pursuant to Paragraph 10(d)(2) hereof.
 
          The Committee may, in its absolute discretion, adjust any grant of
          shares of Restricted Stock, the Issue Date with respect to which
          has not occurred as of the date of the occurrence of any of the
          following events, or any grant of shares of Phantom Stock, to
          reflect any dividend, stock split, recapitalization, merger,
          consolidation, combination, exchange of shares or similar
          corporate change as the Committee may deem appropriate to prevent
          the enlargement or dilution  of rights of Participants under the
          grant.
 
 
<PAGE>
     (c)  Outstanding Options, LSARs, Tandem SARs and Stand-Alone
          SARs--Certain Increases or Decreases in Issued Shares Without
          Consideration
 
          Subject to any required action by the shareholders of Delta
          Petroleum Corporation, in the event of any increase or decrease in
          the number of issued Common Shares resulting from a subdivision or
          consolidation of Common Shares or the payment of a stock dividend
          (but only on the Common Shares), the Committee shall
          proportionally adjust the number of Common Shares subject to each
          outstanding Option, LSAR, Tandem SAR and Stand-Alone SAR, and the
          exercise price per Common Share of each such Option, LSAR, Tandem
          SAR and Stand-Alone SAR.
 
     (d)  Outstanding Options, LSARs, Tandem SARs and Stand-Alone
          SARs--Certain Mergers
 
          Subject to any required action by the shareholders of Delta
          Petroleum Corporation, in the event that Delta Petroleum
          Corporation shall be the surviving corporation in any merger or
          consolidation (except a merger or consolidation as a result of
          which the holders of Common Shares receive securities of another
          corporation), each Option, LSAR, Tandem SAR and Stand-Alone SAR
          outstanding on the date of such merger or consolidation shall
          pertain to and apply to the securities which a holder of the
          number of Common Shares subject to such Option, LSAR, Tandem SAR
          or Stand-Alone SAR would have received in such merger or
          consolidation.
 
     (e)  Outstanding Options, LSARs, Tandem SARs and Stand-Alone
          SARs--Certain Other Transactions
 
          Delta Petroleum Corporation shall not, at any time while there are
          issued and outstanding pursuant to this Plan any unexpired options
          (including any related LSARs or Tandem SARs), Stand-Alone SARs or
          other rights to acquire securities of Delta Petroleum Corporation
          (whether or not then exercisable), effect a merger, consolidation,
          exchange of shares, recapitalization, reorganization, or other
          similar event, as a result of which shares of Common Stock of
          Delta Petroleum Corporation shall be changed into the same or a
          different number of shares of the same or another class or classes
          of stock or securities or other assets of Delta Petroleum
          Corporation or another entity, or enter into any agreement to
          effect a sale of all or substantially all of Delta Petroleum
          Corporation's assets (a "Corporate Change"), unless the resulting
          successor or acquiring entity (the "Resulting Entity") assumes by
          written instrument all of  Delta Petroleum Corporation's
          obligations pursuant to any options then outstanding under this
          Plan (including any related LSARs or Tandem SARs), Stand-Alone
          SARs or other rights under this Plan to acquire securities of
          Delta Petroleum Corporation (whether or not then exercisable),
          which shall include, but not limited be to, an agreement in such
          written instrument that any and all options then outstanding under
          this Plan (including any related LSARs or Tandem SARs),
          Stand-Alone SARs or other rights to acquire securities of Delta
 
 
 
<PAGE>
          Petroleum Corporation (whether or not then exercisable) or other
          rights shall be exercisable into such class, amount and type of
          securities or other assets (or stock appreciation rights with
          respect to, as appropriate) of the Resulting Entity as the holder
          would have received had the holder exercised its options
          (including any related LSARs or Tandem SARs), Stand-Alone SARs or
          other rights to acquire securities of Delta Petroleum Corporation
          (whether or not then exercisable) issued pursuant to this Plan
          immediately prior to such Corporate Change, and the Exercise Price
          of such options or other rights shall be proportionately increased
          (if such options or other rights shall be changed into or become
          exchangeable for an option, warrant or other right to purchase a
          smaller number of shares of Common Stock of the Resulting Entity)
          or shall be proportionately decreased (if such options or other
          rights shall be changed or become exchangeable for an option,
          warrant or other right to purchase a larger number of shares of
          Common Stock of the Resulting Entity); provided, however, that
          Delta Petroleum Corporation shall not affect any Corporate Change
          unless it first shall have given thirty (30) days notice of any
          Corporate Change to each holder of issued and outstanding
          unexpired options or other rights to acquire securities of Delta
          Petroleum Corporation pursuant to this Plan at such holder's last
          known address as reflected on the books and records of Delta
          Petroleum Corporation.
 
     (f)  Outstanding Options, LSARs, Tandem SARs and Stand-Alone
          SARs--Other Changes
 
          In the event of any change in the capitalization of Delta
          Petroleum Corporation or corporate change other than those
          specifically referred to in Section 14(c), (d) or (e) hereof, the
          Committee shall make such adjustments in the number and class of
          shares subject to Options, LSARs, Tandem SARs or Stand-Alone SARs
          outstanding on the date on which such change occurs and in the per
          share exercise price of each such Option, LSAR, Tandem SAR and
          Stand-Alone SAR to prevent dilution or enlargement of rights.
 
     (g)  No Other Rights
 
          Except as expressly provided in the Plan, no Participant shall
          have any rights by reason of any subdivision or consolidation of
          shares of stock of any class, the payment of any dividend, any
          increase or decrease in the number of shares of stock of any class
          or any dissolution, liquidation, merger or consolidation of Delta
          Petroleum Corporation or any other corporation. Except as
          expressly provided in the Plan, no issuance by Delta Petroleum
          Corporation of shares of stock of any class, or securities
          convertible into shares of stock of any class, shall affect, and
          no adjustment by reason thereof shall be made with respect to the
          number of Common Shares subject to an Incentive Award or the
          exercise price of any Option, LSAR, Tandem SAR or Stand-Alone SAR.
 
15.  Rights as a Shareholder
 
     No person shall have any rights as a shareholder with respect to any
Common Shares covered by or relating to any Incentive Award granted pursuant
 
 
 
<PAGE>
to this Plan until the date of the issuance of a stock certificate with
respect to such shares. Except as otherwise expressly provided in Section 14
hereof, no adjustment to any Incentive Award shall be made for dividends or
other rights for which the record date occurs prior to the date such stock
certificate is issued.
 
16.  No Special Employment Rights; No Right to Incentive Award
 
     Nothing contained in the Plan or any Incentive Award shall confer upon
any Participant any right with respect to the continuation of his employment
by the Company or interfere in any way with the right of the Company, subject
to the terms of any separate employment agreement to the contrary, at any time
to terminate such employment or to increase or decrease the compensation of
the Participant from the rate in existence at the time of the grant of an
Incentive Award.
 
     No person shall have any claim or right to receive an Incentive Award
hereunder. The Committee's granting of an Incentive Award to a Participant at
any time shall neither require the Committee to grant an Incentive Award to
such Participant or any other Participant or other person at any time nor
preclude the Committee from making subsequent grants to such Participant or
any other Participant or other person.
 
17.  Securities Matters
 
     (a)  Notwithstanding anything herein to the contrary, the Company shall
          not be obligated to cause to be issued or delivered any
          certificates evidencing Common Shares pursuant to the Plan unless
          and until the Company is advised by its counsel that the issuance
          and delivery of such certificates is in compliance with all
          applicable laws, regulations of governmental authority and the
          requirements of any securities exchange on which Common Shares are
          traded. The Committee may require, as a condition of the issuance
          and delivery of certificates evidencing Common Shares pursuant to
          the terms hereof, that the recipient of such shares make such
          covenants, agreements and representations, and that such
          certificates bear such legends, as the Committee, in its sole
          discretion, deems necessary or desirable.
 
     (b)  The exercise of any Option granted hereunder shall only be
          effective at such time as counsel to the Company shall have
          determined that the issuance and delivery of Common Shares
          pursuant to such  exercise is in compliance with all applicable
          laws, regulations of governmental authority and the requirements
          of any securities exchange on which Common Shares are traded. The
          Company may, in its sole discretion, defer the effectiveness of
          any exercise of an Option granted hereunder in order to allow the
          issuance of shares of Common Stock pursuant thereto to be made
          pursuant to registration or an exemption from the registration or
          other methods for compliance available under federal or state
          securities laws. The Company shall inform the Participant in
          writing of its decision to defer the effectiveness of the exercise
          of an Option granted hereunder. During the period that the
          effectiveness of the exercise of an Option has been deferred, the
          Participant may, by written notice, withdraw such exercise and
          obtain the refund of any amount paid with respect thereto.
 
 
 
<PAGE>
     (c)  With respect to persons subject to Section 16 of the Securities
          Exchange Act of 1934, transactions under this Plan are intended to
          comply with all applicable conditions of Rule 16b-3 or its
          successors under the Exchange Act. To the extent any provision of
          the Plan, the grant of an Incentive Award, or action by the
          Committee fails to so comply, it shall be deemed null and void, to
          the extent permitted by law and deemed advisable by the Committee.
 
18.  Withholding Taxes
 
     (a)  Cash Remittance
 
          Whenever Common Shares are to be issued upon the exercise of  an
          Option, the occurrence of the Issue Date or Vesting Date with
          respect to a share of Restricted Stock or the payment of a Stock
          Bonus, the Company shall have the right to require the Participant
          to remit to the Company in cash an amount sufficient to satisfy
          federal, state and local withholding tax requirements, if any,
          attributable to such exercise, occurrence or payment prior to the
          delivery of any certificate or certificates for such shares. In
          addition, upon the exercise of an LSAR, Tandem SAR or Stand-Alone
          SAR, the grant of a Cash Bonus or the making of a payment with
          respect to a share of Phantom Stock, the Company shall have the
          right to withhold from any cash payment required to be made
          pursuant thereto an amount sufficient to satisfy the federal,
          state and local withholding tax requirements.
 
     (b)  Stock Remittance
 
          At the election of the Participant, subject to the approval of the
          Committee, when Common Shares are to be issued upon the exercise
          of an Option, the occurrence of the Issue Date or the Vesting Date
          with respect to a share of Restricted Stock or the grant of a
          Stock Bonus, in lieu of the remittance required by Section 18(a)
          hereof, the Participant may tender to the Company a number of
          Common Shares determined by such Participant, the Fair Market
          Value of which at the tender date the Committee determines to be
          sufficient to satisfy the federal, state and local withholding tax
          requirements, if any, attributable to such exercise, occurrence or
          grant and not greater than the Participant's estimated total
          federal, state and local tax obligations associated with such
          exercise, occurrence or grant.
 
     (c)  Stock Withholding
 
          At the election of the Participant, subject to the approval of the
          Committee, when Common Shares are to be issued upon the exercise
          of an Option, the occurrence of the Issue Date or the Vesting Date
          with respect to a share of Restricted Stock or the grant of a
          Stock Bonus, in lieu of the remittance required by Section 18(a)
          hereof, the Company shall withhold a number of such shares
          determined by such Participant, the Fair Market Value of which at
          the exercise date the Committee    determines to be sufficient to
          satisfy the federal, state and local withholding tax requirements,
          if any, attributable to such exercise, occurrence or grant and is
          not greater than the Participant's estimated total federal, state
          and local tax obligations associated with such exercise,
          occurrence or grant.
 
 
<PAGE>
19.  Amendment of the Plan
 
     The Plan will have no fixed termination date, but may be terminated at
any time by the Board of Directors. Incentive Awards outstanding as of the
date of any such termination will not be affected or impaired by the
termination of the Plan. The Board of Directors may amend, alter, or
discontinue the Plan, but no amendment, alteration or discontinuation shall be
made which would (i) impair the rights of a Participant without the
Participant's consent, except such an amendment which is necessary to cause
any Incentive Award or transaction under the Plan to qualify, or to continue
to qualify, for the exemption provided by Rule 16b-3, or (ii) disqualify any
Incentive Award or transaction under the Plan from the exemption provided by
Rule 16b-3. In addition, no such amendment may be made without the approval of
the Company's shareholders to the extent such approval is required by law or
agreement.
 
20.  No Obligation to Exercise
 
     The grant to a Participant of an Option, LSAR, Tandem SAR or Stand-Alone
SAR shall impose no obligation upon such Participant to exercise such Option,
LSAR, Tandem SAR or Stand-Alone SAR.
 
21.  Expenses and Receipts
 
     The expenses of the Plan shall be paid by the Company. Any proceeds
received by the Company in connection with any Incentive Award will be used
for general corporate purposes.
 
22.  Suspension or Termination of Incentive Award
 
     In addition to the remedies of the Company elsewhere provided for
herein, failure by a Participant to comply with any of the terms and
conditions of the Plan or the agreement executed by such Participant
evidencing an Incentive Award, unless such failure is remedied by such
Participant  within ten days after having been notified of such failure by the
Committee, shall be grounds for the cancellation and forfeiture of such
Incentive Award, in whole or in part, as the Committee may determine.
 
23.  Code Section 162(m).
 
     The Committee, in its sole discretion, may require that one or more
Incentive Awards contain provisions which provide that, in the event Section
162(m) of the Code, or any successor provision relating to excessive employee
remuneration, would operate to disallow a deduction by the Company for all or
part of any Incentive Award under the Plan, a Participant's receipt of the
portion of such Incentive Award that would not be deductible by the Company
shall be deferred until the next succeeding year or years in which the
Participant's remuneration does not exceed the limit set forth in such
provision of the Code.
 
24.  Effective Date of Plan
 
     The Plan shall be effective as of January 1, 2001, subject to approval
by the Company's Shareholders at their next Annual or Special Meeting.
 
 
 
<PAGE>
25.  Participation in the Plan by Nonemployee Directors
 
     (a)  The Plan will be administered as to Nonemployee Directors by the
          Board of Directors.
 
     (b)  All Nonemployee Directors shall participate in the Plan, subject
          to the conditions and limitations of the Plan, so long as they
          remain eligible to participate in the Plan.
 
     (c)  No Nonemployee Director shall be eligible for an Incentive Award
          if, at the time said Incentive Award would otherwise be granted,
          such Nonemployee Director (i) is directly or indirectly the
          beneficial owner of five percent or more of any class of equity
          security of the Company which is registered pursuant to Section 12
          of the Exchange Act or of any security convertible into or
          exercisable for such class of equity security (excluding shares
          covered by the Plan); or (ii) is an officer, director, 10% or
          greater shareholder, employee or agent of a person or entity which
          is directly or indirectly the beneficial owner of more than five
          percent of any class of equity security of the Company which is
          registered pursuant to Section 12 of the Exchange Act or of any
          security convertible into or exercisable for such class of equity
          security (excluding shares covered by the Plan).  Incentive Award
          grants, if any, to any such non-eligible Nonemployee Directors
          shall be determined by the Board.
 
     (d)  Unless the Board of Directors shall otherwise direct, Options or
          Restricted Common Stock shall automatically be granted to
          Nonemployee Directors according to the following formula:
 
          (i)  Stock and Options shall be determined for all eligible
               Nonemployee Directors of the Company in each calendar year
               during the term of the Plan as of December 31.  No Stock or
               Option may be changed after it has been so determined,
               except pursuant to the Plan.  No Nonemployee Director shall
               be entitled to receive more than one grant of Stock or
               Options per year pursuant to the Plan even if such
               Nonemployee Director serves as a director for more than one
               Participating Company.  The Stock or Options shall be
               granted to each Participant by the Company or, if the
               Participant is not a Nonemployee Director of the Company, by
               the Participating Company for which a Nonemployee Director
               serves as a director.
 
          (ii) Stock or Options shall be granted pursuant to the Plan to
               eligible Participant as follows:
 
               Annually each Participant shall be granted either:  (1) an
               option for 20,000 shares of common stock, or, if a director
               for less than the prior 12 months, a pro rata portion of
               20,000 shares of common stock based upon the number of
               months such Participant was a Nonemployee Director of the
               Company; or (2) at the election of the participating
               Nonemployee Director, shall be granted, in lieu of an
               option, 10,000 shares of Restricted Common Stock.
 
 
 
<PAGE>
     The exercise price of the Stock Options to be granted to Nonemployee
Directors pursuant to the Plan shall be 50% of the Market Price as determined
at the date of grant.  The "Market Price" of a share of common stock under the
Plan shall be the average of the "Fair Market Value" of the common stock for
all trading days during the twelve months preceding the date on which the
stock option is determined.  The "Fair Market Value" of a share of common
stock with respect to any day shall be (i) the closing sales price of a share
of common stock as reported on the principal securities exchange on which
shares of common stock are then listed or admitted to trading; or (ii) if not
so reported, the last sales price as reported by the NASDAQ Stock Market; or
(iii) if not so reported, the average of the closing bid and ask prices as
reported on the NASDAQ Stock Market; or (iv) if not so reported, as furnished
by any member of the National Association of Securities Dealers, Inc. selected
by the Committee.  Each Stock Option shall be exercisable for a ten year
period commencing on the date of grant and shall expire ten years after the
date of grant.  Certificates evidencing the Stock Options shall be registered
in the respective names of the Participants and shall be issued to each
Participant as soon as practicable following the date of grant.