EXHIBIT 10.1 LOAN AGREEMENT WITH FALCON OIL& GASLTD. DATED OCTOBER 1, 2008

WHEREAS, Borrower and Lender have entered into (i) a Purchase and Sale Agreement among Borrower, Sweetpea Petroleum Pty Ltd., Lender and Falcon Oil & Gas Australia Pty Ltd dated August 22, 2008 (the “Beetaloo PSA”) providing for the sale of a 50% working interest in the Beetaloo Basin properties, and (ii) a Purchase and Sale Agreement among Borrower, PetroHunter Operating Company, Lender and Falcon Oil & Gas USA, Inc. dated August 22, 2008 ((the “Buckskin Mesa PSA”) providing for the sale of a 25% working interest in 5 wells and applicable spacing units (the “Buckskin Mesa Wells”); and

a. The Loan shall be secured by a first charge/mortgage in favor of Lender on the Buckskin Mesa Wells, as evidenced by a Mortgage, Assignment, Security Agreement, Fixture Filing and Financing Statement (the “Mortgage”) in the form attached hereto as Exhibit “C” and incorporated by reference herein.

b. Borrower shall pledge shares of Lender’s capital stock or securities convertible into shares of Lender’s capital stock (collectively, the “Pledge Shares”), which it has acquired in connection with the closing of the Beetaloo PSA in accordance with the following and in the following priority:

i)    Pledge Shares with a value equivalent to US$7,500,000 (calculated based on the closing trading price of the Lender’s common shares on the TSX Venture Exchange on the trading day immediately prior to the closing of the Loan) shall be deposited in a brokerage account designated by Lender, with the proceeds of sale irrevocably directed to Lender to be applied on account of the Indebtedness, with the pledge evidenced by a Pledge and Security Agreement in the form attached hereto as Exhibit “D” and incorporated by this reference;

ii)   Up to US$6,000,000 worth of Pledge Shares (calculated based on the closing trading price of the Lender’s common shares on the TSX Venture Exchange on the trading day immediately prior to the closing of the Loan) shall be available to Borrower as collateral for loans from third parties, and if Borrower obtains any such third party loans, the proceeds thereof shall be applied as follows:  the first US$3,000,000 shall be for Borrower’s use as working capital in the normal course of business, the next US$3,000,000 shall be paid to Lender to reduce the outstanding balance on the Loan, the next US$1,000,000 shall be available to Borrower, and thereafter proceeds of US$1,000,000 or lesser amounts shall be distributed successively 50% to each party until the earlier of being fully applied or until all accrued and unpaid interest and principal under the Loan is fully paid; and

iii)   All remaining Pledge Shares shall be unpledged and may be sold by Borrower, in which case the proceeds of any such sale shall be divided equally (50/50) between Borrower and Lender until the earlier of being fully applied or until all accrued and unpaid interest and principal under the Loan is fully paid.

As the Pledge Shares are being held in escrow pursuant to the terms of the Beetaloo PSA, Borrower and Lender shall advise the Escrow Agent (as defined in the Beetaloo PSA) of this Loan Agreement and the security interest created in the Pledge Shares by sending a notice in the form attached hereto as Exhibit “E”.

c.  Pay all amounts owing to all governmental authorities when due, including without limitation, all amounts owing in respect of the realty taxes, levies or similar charges related to the Beetaloo Basin and Buckskin Mesa properties (the “Properties”);

d.  File and pay all tax returns and any other claims or obligations including those which may rank in priority to the Security;

e.  Upon request, provide to Lender such reports and information concerning the Properties, and Borrower and its business and affairs as Lender may reasonably request;

f.  Promptly report any material adverse change in Borrower’s business or affairs immediately following any occurrence thereof; and

4.           Conditions of Lending.  Lender’s obligation to advance the Loan shall be subject to and conditional upon the satisfaction of the following conditions, each of which may be waived by Lender in its sole and unfettered discretion:

a.  Borrower shall have executed and delivered this Loan Agreement, the Note, the Mortgage, the Pledge and Security Agreement and such other and further documents as contemplated hereby as may be reasonably required by Lender.

b.  Borrower shall have provided materials, satisfactory to Lender, supporting the disclosure of the obligations and information provided in Schedule “A”.

c.  The Beetaloo PSA shall have been amended by deleting the last sentence in Section 2.4(b) thereof and replacing said sentence with a new sentence which shall provide as follows:  “The Adjustment Amount shall not exceed US$3,500,000.”

d.  Schedule “A” to the Initial Buckskin Mesa Escrow Agreement (as that term is defined in the Beetaloo PSA) shall have been amended to provide that the Initial Completion Program and AFE for each of the five wells shall be designed to allow meaningful completion work to be performed on all five of the wells, with the specific work to be performed on each well mutually agreed to by Rod Wallis (of Lender) and Lyle Nelson (of Borrower) and that if either or both of said individuals is no longer employed by his respective employer, such party shall promptly designate a new representative.

5.           Events of Default.  At the sole option of Lender, upon the occurrence of any of the following events (each an “Event of Default” and collectively, “Events of Default”), all of the Indebtedness shall become due and payable and the Security shall become enforceable:

b.           Borrower or any guarantor of the Indebtedness fails to observe, perform or is otherwise in breach of any of its obligations to Lender hereunder or under the Security;