SETTLEMENT AGREEMENT THIS AGREEMENT, effectivc as of February 22, 2003 (the "Agreernent"), is entered into by and between ExxonMobil Sao Tome and Príncipe Limited, a corporation organized and existing under laws of the Bahamas, (hereinafter referred to as "ExxonMobil") and the Democratic Republic of Suo 'fome e Principc,HGFEDCBA(hcrcinaftcr rcfcrred to as "DRSTP"). WHEREAS, MobilExploration and Producing Serviees Inc. ("Mobil", the predecessor in the interest to ExxonMobil) and the DRSTP entered into that certain Technical Assistance Agreement ("TAA") of 18·September 1998 under which, among other things, Mobil agreed to makc certain bonus payments and undertakc specified technical evaluation, which bonus payments and tcchnical cvaluation were made and completed; and WHEREAS, the DRSTP and ExxonMobil negotiated in a good faith effort to carry out the tcrms and conditions of the TAA, but lo date havc not concluded a Production Sharing Contract ("PSC") as contemplated under the TAA; and WHEREAS, the DRSTP and the Federal Republic ofNigeria ("Nigeria") have agreed lo tenns and conditions 01' a Trcaty bct wccn them for lhe Joint Dcvclopmcnt of Petrolcum and other Resources ("Trealy") covcring a specified area (lhe "Joint Development Zone" or JDZ") that includes the area for which ExxonMobil and DRSTP have been working to conclude a PSC under lhe TAt\; and recognizing lhe dcsirc of lhe ORSTP and Nigeria lo resolve third party c1aims as providcd for in Article 46 01' the Trcaty; and WHEREAS, the DRSTP and Nigeria have agrccd that intcrests in the JDZ wiU be managed by a Joint Devclopment Authority (".IDA"), composed of representatives frorn both thc DRSTP and Nigeria; and EXXOIlMobil, as considcration for cntcring into this Agreement has agreed to relinquish its rights undcr thc TAA, including the right to enter into a PSC pursuant to the TAA. NOW THEREFORE, in considcratiou 01' lhe cxpcnditurcs, rclcuscs, wuivcrs uno othcr good and valuable consideration, the DRSTP and ExxonMobil agree as follows: WAIVER OF PRIOR RIGI-ITS ANO GRANTS OF PREl:ERENTlAL RIGIITS Subject to the terms and conditions of this Agreement and the implementation thereof, including alI necessary approvals, ExxonMobil hercby fully rcleases the DRSTP for any c1aim ExxonMobil may have against lhe DRSTP under the TAA 01' otherwise, ano waivcs ali such rights, ano lhe DRSTP ano ExxonMobil agree that ExxonMobi is hcreby grantcd the following rights: Ájt /. '.I y~ I/~.:;:/ // / Recognizing the JDA's authority to define block size in the JDZ. and recognizing that the Parties understand that such block boundaries and sizes have been proposed to the Joint Ministerial Council for approval as shown in "Attachmcnt A" to this Agreement. Now it being understood by the Parties to this Agreement that the size of such blocks will be approximately the same size as those set out in Attachment A, and the configuration of such blocks shall be substantially similar to that set out in Attaehment A, the Parties to this Agreement agree that ExxonMobil is hereby granted preferential rights to participate in JDZ acrcagcHGFEDCBA(Prcfcrcntiul Rights) as Iollows: • ExxonMobil may clcct to sclcct une hlock írom blocks olfcrcd in any part 01' lhe area of the Joint Development Zonc, and acquire a 40% interest in this block by either: I) agreeing to pay 40% of the first confirrncd, bona ride. high bid for the block, consistent with the terms and conditions of the license round, and agreeing to the terms and conditions of the PSC, or other grant of rights to the block (ir such block is offered in a license round); or 2) by agreeing to pay 40% of the negotiated PSC, or other grant of rights, signing bonus, and agreeing to the terms and conditions associated with such PSC or grant of rights (if such block is not offered in a licensc round). (Bona Fide high bid, for purposes of this Settlement Agreement, is understood to mean the high bid rnade by a party having the technical and financial capability to satisfy sueh bid and to conduct exploration. devclopment and production operations on the block); and in addition ExxonMobil may elect to selcct a seeond block Irom blocks olfcrcd in any part 01'lhe • area ofthe Joint Development Zone, and acquire a 25% interest in this block by either: I) agreeing to pay 25% 01'thc first confirmed, bona fidc, high bid for the block, consistent with the terms and conditions of the license round, and agreeing to the terms and conditions 01'the PSC. or othcr grant of rights to thc block (if such block is offered in a license round); or 2) by agreeing to pay 25% of the negotiated PSC, or other grant of rights, signing bonus, and agreeing to the terms and conditions associated with such PSC or grant of rights (if such block is not offered in a license round); and in addition • ExxonMobil may elect to seleet a third bloek Irorn blocks oífcrcd in any part 01'thc area of the Joint Deve10pment Zonc, and acquire a 25% interest in the block by either: 1) agreeing to pay 25% 01'thc first confirrncd, bona ride, high bid for the block, consistent with the terms and conditions of the license round, and agreeing to the tenns and conditions of thc PSC. or othcr grunt ofrights to the block (ifsuch block is offered in a license round); 01'2) by agreeing to pay 25% 01'the negotiated PSC, or other grant of rights, signing bonus, and agreeing to the terms and conditions associated with sueh PSC or grant 01'rights (if such bloek is not offered in a license round). • Subject to the approval of thc .IDA, whieh approval shall not be unreasonably withheld, ExxonMobil may elect under this Agreement to be Operator of any one of the three blocks referenced above in whieh it is thc highcst equity holder in the bloek, or in which its equity interest is substantially similar to the otherwise ighest equity holder. TIME lN WHICH TO EXERCISE The JDA shall provi de ExxonMobil initial notice ofthe high bid for any block offered in the JDZ; ExxonMobil shall have one (1) weck írom the time of reeeipt of such initial notice in whieh to notify the JDA if it desires additional information on any such bid. ExxonMobil shall have thirty (30) days, from the date of receipt of any additional information requested and vcrification of thc formal notification of the high bid and ussociutcd final tcrms und conditions und any PSC signing bOIlUS,iII which to elcct (o exercise its Prefcrential Right undcr this Agrccmcnt. AGREEMENT TO TAKE ALL NECESSARY ACTION Consistent with the Treaty, lhe DRSTP shall undertake ali necessary actions to effectuate the Preferential Rights set out in this Agreement, including approval of this Agreement by the Joint Ministerial Couneil. (' "nmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA SEISMIC DATA Subject to any obligation to purehase an initial seismie survey from a speeified seismic vendo r, as may be set out in the terms and conditions of a license round or PSC by the JDA, the Parties agree that ExxonMobil shall have the right to conduct seismic activity in any block it may select under this Agreement. CONFIDENTIALITY ExxonMobil and the DRSTP, its agents and representatives, agree that the terms and eonditions ofthis Agreement shall be kept confidential. The Parties agree, however, that the DRSTP shall disclose this Agreement to ali members ofthe JDA, and the Parties shall also be free to disclose this Agreement to such government representatives ofNigeria, who may have a reasonable need to know 01'its existence. Further, the DRSTP will seek to have the JDA disclose the existence 01' this Prcfcrcntial Right to hidders in any licensing round for which the Prefercntial Right still exists without disclosing thc financial or other terms for such Preferential Right hereunder. ExxonMobil may disclose lhe tcrms ofthis Agreement if it is rcquircd (o disclosc thc Agrccmcnt by applicablc law or regulation and may disclose this Agreement to its Affiliates. Notwithstanding anything to the eontrary contained herein, the DRSTP or ExxonMobil may disclose this Agreement with the written consent 01'the other Party. ASSIGNMENT Neither party hereto may assign any 01' its rights 01"obligations hcrcunder without the prior written eonsent of the other party hcrcto, which consent shall not be unreasonably withhcld. Notwithstanding, eithcr party may Irccly assign any and a~1rights her under. lo a technically and financially competent alfiliated company. 03 1 // MISCELLANEOUS This agreement shall be govemed by the laws of England without regard to its otherwise applicable principies of conflicts of laws. However, the Parties waive their right under English law to apply to the courts for rulings on questions of law during the course of an arbitration and further waive their right to challenge the arbitrators' award on the basisHGFEDCBAof a mistak.e of law. Any dispute, controversy or claim arising out of or in relation to or in connection with this Agreement or the activities carried out under this Agreement, including without limitation any disputes as to the construction, validity, interpretation, enforceability or breach of this Agreement, shall be exclusively and finally settled by arbitration under the Rules of Conciliation and Arbitration of the Intemational Chamber of Commerce by three arbitrators. However, prior to initiating any arbitration, the Parties shall make ali reasonable efforts to amicably resolve any dispute, controversy or claim associated with this Agreement. ln the event ofarbitration, each side shall appoint one (1) arbitrator within thirty (30) days ofthe submission of a Notice of Arbitration. The Party-appointed arbitrators shall in tum appoint a presiding arbitrator within thirty (30) days following the appointment of the Party-appointed arbitrators. The arbitration proceeding shall be held in London, England. The proceedings shall be i' conducted in the English language, and the arbitrators shall be fluent in the English language. The arbitrators shall have at all times no financial interest in the Parties, dispute, controversy or claim. Awards shall be final and not subject to appeal. Judgment upon the award may be entered in any court having jurisdiction over the Party or the assets of the Party owing the judgment or application may be made to such court for ajudicial acceptance ofthe award and an order of enforcement, as the case may be. Each of the parties hereto represents and warrants that it possesses ali requisite authority and authorizations for the execution, delivery and perfonnance of this Agreement, and the execution, delivery and perfonnance of this Agreement does not violate and will not result in the violation of or default under any tenn or provision under any agreement to which it is a party. This Agreement shall tenninate and no longer be of any force or effect upon the earlier of either: ExxonMobil' s exercise of ali of its rights under this Agreement; or final award and execution of the PSC' s for ali acreage within the JDZ. Except as otherwise provided herein, this Agreement constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes all prior or contemporaneous written or oral understandings, agreements or representations (including without limitation the TAA and any agreements reached in respect of such TAA) other than those contained in this Agreement. There are no understandings or agreements relating to this Agreement that are not fully expressed herein. No modification, amendment, addition or revision of this Agreement shall be valid and binding' unless set forth in writing executed by both parties hereto. The Parties agree that this Agreement may be executed in counterpart, and that the separately executed copies will constitute a fully executed Agreement. lN WITNESS WHEREOF, the respective Parties have caused this Agreement to be executed by the signatures of their duly authorized representatives, effective as of the effective date set forth in the first paragraph hereto. ExxonMobilHGFEDCBASao Tome and Principe Limited The Govemment of the Democratic Republic of Sao Tome e Principe (s~f9~~- Name:'~k~ ~ ,lII I~~~~_n, tr-\- Title/~~~n / Title:~ ~~ - ~\~rk-\n~ ~~},\, ACKNOWLEDGED ANP APPROVED: ~. JQintMinisterial Council for the Joint Development Zone ofNigeria and Sao Tome e · . nnClpe P , - ~ Si nature ~ 4" 4...IrV''''-1>'l- a; ~~ h\>.6€w\ Qt\)"Yl~ •. ITitle) M/tJD1't'1<... iJf' ,jff..l