EXHIBIT 10.8


                              SETTLEMENT AGREEMENT




     THIS SETTLEMENT AGREEMENT is entered into as of this 23rd day of September,
2002 by and between Hadro Resources, Inc., a Nevada corporation (the "Company")
and Tri Star Financial Corp. ("Tri Star").



                                    RECITALS:

     WHEREAS, the Company has incurred substantial monetary obligations
concerning its business operations and associated contractual relations in the
area of oil and gas exploration and management;

     WHEREAS, Tri Star has made monetary advances to the Company in the
aggregate amount of $________ in order to assist the Company in financing its
contractual debts and ongoing business expenses;

     WHEREAS, the Company has incurred an aggregate of $83,610 to Tri Star
relating to such amounts advanced by Tri Star and accrued interest thereon (the
"Debt");

     WHEREAS, the Company and Tri Star have settled their differences regarding
the Debt and wish to set forth their settlement agreement;

     WHEREAS, the Company desires to settle the Debt by issuing shares of its
restricted common stock, par value $0.0001 (the "Common Stock") at the rate of
$0.109 per share (which amount is based upon the average of the open and close
price of $0.10 of the Company's shares of Common Stock traded on the OTC
Bulletin Board as of September 23, 2002); and

     WHEREAS, Tri Star desires to convert the Debt and accept the issuance of
765,211 shares of restricted Common Stock of the Company as full and complete
satisfaction of the Debt;

     WHEREAS, the Company and Tri Star desire to release one another from any
and all further liability as related to the aforesaid Debt.




     NOW, THEREFORE, in consideration of the aforesaid recitals and mutual
promises contained herein, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:


                                    AGREEMENT

     1. The Company agrees to issue to Tri Star 765,211 shares of its restricted
Common Stock, at $0.109 per share, as of September 23, 2002, as full and
complete satisfaction and payment of the Debt.

     2. Tri Star agrees to accept the issuance of 765,211 shares of the
restricted Common Stock of the Company as full and complete satisfaction and
payment of the Debt.

     3. The Company and Tri Star shall agree to release each other and forever
discharge any and all claims, manner of actions, whether at law or in equity
suits, judgments, debts, liens, liabilities, demands, damages, losses, sums of
money, expenses or disputes, known or unknown, fixed or contingent, which it now
has or may have hereafter, directly or indirectly, individually or in any
capacity against each other, their successors and assigns, as well as its
present or former owners, directors, officers, stockholders, employees, agents,
heirs, by reason of any act, omission, matter, cause, or thing whatsoever, from
the beginning of time to, and including the date of the execution of this
Agreement, relating to the aforesaid Debt.

     4. Tri Star acknowledges that the issuance of the 765,211 shares of
restricted Common Stock (i) has not been registered under the Securities Act of
1933, as amended (the "1933 Securities Act"); (ii) is in reliance on the
exemption provided by Section 4(2) of the 1933 Securities Act, (iii) are being
acquired solely for Tri Star's own account without any present intention for
resale or distribution, (iv) will not be resold without registration under the
1933 Securities Act or in compliance with an available exemption from
registration, unless the shares of Common Stock are registered under the 1933
Securities Act and under any applicable state securities law or an opinion of
counsel satisfactory to the Company is delivered to the Company to the effect
that any proposed distribution of the shares of Common Stock will not violate
the registration requirements of the 1933 Securities Act and any applicable
state securities laws, and (v) that Tri Star understands the economic risk of an
investment in the Common Stock and has had the opportunity to ask questions of
and receive answers from the Company's management concerning any and all matters
related to the acquisition of the Common Stock.




     4. This Settlement Agreement shall be effective as of September 23, 2002
and shall be binding upon and insure to the benefit of the parties hereto and
their respective successors.


                                            Hadro Resources, Inc.



Date:_____________                          By:__________________________
                                               Grant Atkins, President




                                            Tri Star Financial Corp.


Date:______________                         By: __________________________
                                                President