PRODUCTION SHARING CONTRACT FOR THE JOINT PETROLEUM DEVELOPMENT AREA CONTRACT AREA - JPDA 1 1 - 106 Adde 3 Weliuquishment af Blacks ......... .- .................. "..-....i....i ................ ................ ..We 1-6 3.1 Wdinquishrncrit sfkplocatian Axes .................. ...... .......................................... 16 3.2 Rdinquhbt of Deuelqm&at Aixa ............. ..,.,. ............................................... 16 3.9 Term- of . Apment arrd Canhuing Obligdim ia mgiect of-ReEiapui8hd Area ................................................................................................................... 17 ...................................................................... 3.4 GasRdanh .......,............. ., 17 5.5 Oil Retention Area ................... ... ........................................................................ 17 Artide 4 Work P~ogmmm aha Budget .......................................................... *..I,. ........... *+*I8 . w 4- 1 Codtm&tt in Bxp3maQ~n Fdod .................................................... L 43 Pmhm bFExpl~mtim Wmk Pfigmme, and Mget ...........*....... .. .......-. 18 4.3 E-Gwo~No~-P&ITIwI~~ ..,.................... ...................................... ... i18 4.4 Work W~amms and Bu&ge% ..................................................................... .-.T... .. 19 4.5 . 4.6 libagemy .m d , 0~~ Expmdi,- QuCsiddd WarklPIqgame%;md Budge@ ......,.,. 14 Rxpl.matiw ............,,.. ............................. +- ............................................................ 20 4.7 Erisww -ad Apprdgl &r Dim.@ ...........~....................~............................... 12-8 . . 4: 8 Cmmal D~wovepgr ........... .. ........ ..... .................................................... 20 4-9 Dcvelopmmt Plan .................................................................................................. 21 4.10 Devtl~pwentW~rkProgrammesandBud~ts ........................................................ 23 4.11 Approvedhfmcts .................................. .. ...... ,.... ........................................... 2. 3 .. * ................................ .................... 4.12 Dwrrurusslomng ..,,...... ............... 23 4. 13 lh~&ssioning -9 ........+.......a.a....... ..........., ............................................... -24 52 Ac~uto~o~~~a~ ,.-.,,! ..,.,-.,...... .,,f.F,,. ..,I-....,...,.A...- ................ r--.p.., ,. . ..........,... -35 5: HWI~ Sa;Fct:y& t+e ,&~jrpnmq$17 ..-....:..-. . -.! ........ . . ,. . ,,,. ......... , .. -?. .. J25 .... .......... ,... .. 5.4 Goods, 3~~4~s~ Trainingmd B~n$uph&it .., , ..., ,.., ...,.. .., . . .....*........ ..*............*.......... ..... 5:5 FIw~N .....,.,.....-.. : ...... ,.,.......-+.2 6 5.6 Qeriitm and its taub-Contra&m.s .................. ,. .,., ... ,,.,, .. .,.++. .,, ..,. ,.,. .d.,,!i26 Astitle 12 C~~fktion and ~~b~~a60~~~,.~.~.~.-w~~+~~~.~~~~~~~~~~~~~~~~~~~-~~~~~~~--~~-,~ 12.1 Arbdt~&?n ,,.-T...-..... a t..m..,II . . ....:.:......:.. ..rpr..r~l. II...II.,~t ,... ll..~.~,.:~.~f,f~-.~~~.~c~.+..~~~-,~~.-fP~~~~ 12.2 Prg~edure.. ..-Cc~~...~..".~.p.....,.I..~.. XXXXXXXXX CCCC.Cc.. ...... .,.'w...... -w..~.-.,.c.l.l.II ,I.. PPPPPP~.f~~..-~3.~l.f.-..+~..p..~~.~~~ . 12.3 Lo~ationmd&anguage ...7......-~~.-,+* .. ~,~~~,,.~..,~.,.,w,r,.~,.~.~~.9.,.,.,, . .......y.*y...,7.*P... ?. ~-.w.37~.-.-.-r~% ... Artitde 13 Financial and Technical Data, Reixirds and Reports ... ...., .................... *.-..i.*=ii 33 ......................... .................................................... ..................... 1 bmer$hi.jp , ., e.. 33 132, R'ef~~~ StiirPge. R&kBWxmd SUW&i.W .......... *. ................1................................ -34 1.3.3. &@Mgi...+e .........2......c.............. ...d.,......9......r....i..... .....<.... 34 . . ...................*...... ... 1 3 4 EXwflI@f .D ad. mm~~h ................................................................... , .. ,&., .... -34 ... 13-5 hT$e, afD&a~ndI&&matim , ... , ..................... ., .........,....,..,..... ..f , ............,. ........ 34 13.6 ~dden~i~~~~f~zit~r Er~~tq@6q@ ...................... ..,. .. ., .......................... <. , .......... '55 1'3.7. T&de. Sktm~ ........................................................................ +. ..,.,.... .... ...... ..., .. Article 15 Third Party Act&$ ................................ ,.. ...... 36 25. 1 Third Party Access ....................................................~..................................... i...... 36 . '* Article 16 Audit ............... ,., ....*.. ...- .. .....,...... ... ,.. ......... ......,.... .......................... ........ 36 16 1 Independent Apdi t ................................................................................................. -36 1 D~sjmtd Au&mity Auclit ............ ...., ... .... ....................................... 37 1.6. 3. *q>$ans ............................................................................................................. 37 16. 4 Cwkacfw-to Assist .......................................................................................... 57 1 AffiEam ................................................................................................................ 37 . Artids 19 ~~r1~11s an- A$@meut and Chge in ControI ..f..Ur..-v.U.....*l..n~-v.n*.m..~.- 39 l9.l hssigmmt ....................................... ........,..,.......... ....tt*...ttttt*. ............ ..... 39: 1.2 in 6~ntmI .......................................I....... .............,...... ............................I. 40 Mde 20 UthCr Provisions ............. ... ....................................................... .......................... 40 +...... ........*.. .................. x . 1 W&m ...*.................... ...-.> ..**- ...*........ ....Aw .............. ................................. ..................................... 202 ApplimM~-Lm..~ ..-.. ... ..i13r++....-.. 4.0. Annex A . Part 1 . JPDA 11-106 C@NTRACT AREA DESCIUPTIOB ,..< ............................... 44 bnex A . Part 2 . JPDA 11-206 CONTRACT AREA 'DESCRIPTXQM .................... ..,... 47 Annex . MAP OF CONTRACT AREA ....................................... ..., Annex C . ACCWNTXlrsG PROCEDUXE...... ................... , ........ ...-...G; .................. .... 50 1 -1 Purpa3@ ad Dehtibm ..... .... ............... ...,. ......... ..,.. ....................................... -50 1.2 Amounting Records .................................................................... ......................... -50 1.3 Lanpap and Units ofkcaunt ........ .............,......+..... ........................................... 50 . 2.1 Exploration Costs ................................................................................................. 50 23 Appraisal Costs ................... ...... ............................................................... .. 5 1 2:3 Captal Costs ................................ ...,. ....................................................... ..... 51 2.4 Operating Costs ................................................... .,. ................................................ 52 2.5. DeeoMssimhg Casts Reserve. ........................................................................... -52 2.6 Uplift .. ..... 52 ........................................ .... ......................................................... 1.7 Miumlladlws heips ......................... ,.. ............................................... 2.8 hdlgiblt Gosh ..................... ... ........................................................................ -53 2 . 'Other Matks ............................................................. .........................,............... 54' 3.1 Surfac~Righ ............................ .. ..+........................................,............+.... . 55 3.2 Labour and hsociated Labour Co$$s ...................................................................... 55 3.3 "Transportation and Employee WeIuca@ri Costs ...................................................... 56 3 :4 Char- fbr SeMi~es~ ............... .. ..... ... .... .... 3.5 Cmnmuni~a~oa ....................................................... ..., ......................................... 57 3. 6 Offrcq Stbfage and Ms~dm&us F~cil:iti& .......................................................... 57 3.7 Ecp1~~~calmdE~vir~mt ....... .......,.. ............................................................~ 57 3.8 MatddCosts ............................. ., ....................................................... ,. ................. 57 3 .. Reml8. .lhi%$, and OW ~ssessmmts .................................................................... 59 3.. 10 Insmmce :e Lass&.. .. .,. ..59 ..................... ................................. .......................... 3.1.1 LsgalExpmses ........................................................................................................ $9 .. ... 3.12 Clqims .......................................................................................... ,......., ...,... 3 3 -13 Tr+hing Clas.@ ....., J$ ............................................................................................... .... .. 3-14 GC-I~~~EA~W~QSQ . ............:...... ..r. .................................................... sa 3. 15 0%~ Hq~qdjt~ltes ................................................................................................... 59 3.16 Duplication- ..............................................~......... ... ...-.-...-...................... 54 5.1 Prodnction W'mtim ......................... ,. .......................................... .,, ................. 60 5 -2 -Submidion ~f Production .St at~rnmt ..,. ........................................................ 60 ........ 6 -1 Vdue ~f Production md Priting Statdnt Idormation .......................... .... ........ 61 6.2 Submission of Value of Pr~duction Pricirig Slatanent 61 ................................... .. ..... .......**..... ..U...... 6s Annex U . PROPOSALS FOR TSFRIQIR-LE$TE mCAL CONTENT .a* PRODUCTION SHARING CONTRACT CONTRACT AREA - WA f l-l@fi This Agm~Wt,'whrich has been alpprovd by the Jdnt Cbmmission, is at Pm~ctian Sharing Contm~tatd is-snbject w the,Tww bd &e Code l3n.i JJ?DA 1 I-l* S-V- a ~pmtim ~rganised wld existing onder lms af the HeXbwlmd8; DIPEX Ofikore Timar-Late, LTb. a oarpafatioh organisel and misting under the lw ~f Sapan; and TPMOR EM' 11-105, Unipess~a Limitada a koq~mtim orgdsed @d exhiing un* the laws ofThor-bte, cc3Ilmtiv~ly edd the 'W-'', &CS of th ~mnd p&j (Both *fined to individud1 y as a "Party" or ~co~l~tively as the 'LPartirss")a We Desipzid htrthori~, ~4% the Joint Cammi~inrl's appslpv11, ha$ the pwer to m@r i~to hductto~ Sharing Contracts aacording to the Code article 5. I @J(ii]; the D&g~~tcd Authority enterdinto a P1.odochn Sig Conm with the PIX 06-1 05 ~mWurs cm 24 July 2006 TOT the eonmci am JPDA 06-105 to qfom fay, dmvlap and explait Pefsahm; uriw tEta caika& ma ofFDA 051 65 the JNM 06-1 05 ccmtractors made a Dixovq find &e Diwveq wed Kim for whi& a D&~oprrlmt P1m @a& wW&kd and app&~d wjth P&&w $Wnghi 251 1; the hi pted Au&&y agreed tg? 3, the appbval:d&e Jgi& bm&iaq atead the bnal m1iqui~hmcnt d&t&&th~explmBnm wetheJEsDAQ6-lO5PSC ts 10 ~6bry~~ld ar&qmmt W.such relinquisheni was pmvided by the &P Qa 1 1 April 201 1; hDDA 96-1 W mntmtors have ongoing Production nt Eh nexttwhe Wct Arq R the Mitm Wuolhn is ~EMM t0 have peak Pradmfian. dy in thm Production phase and theexpected Wcth~ period is limited to abut 7 yw; if a Disgav~ is made witbin the mmct A.r@, he Dwigmted Authority aad t3e Jaint Cormqissi~n udemd that 4 Dem1opmmt my make use: oftk,Kitan &ih'W, the Convactar wishes to undertake ExpIor&m within the &r&%@t Arm, including a finn sbmmihhent well bn the bnjara p~~spedf, and join and %kist the nwi@atcd AutbriQ in devaldping-arrd exploihhg Petr~Iam in the Contratt Are& for Sd bmfit of the peop1e dTimw-Lest@ ad AusWix Xm~r-L&a and AwWid therefore cobeider it Q be in ihe public intemt that ~~r Ecpl@tation 3% Znnducted io the CGnpa!.:t Art% md thgt Explomti~n wells are driIled in *e pr9$0ects iatb Contra$ w WU as WS$WC In ord* ta>dev~Iap wyD$wva5es WWE aAtw is still in place; thd~~t me Cmtm%n and he Design_atd Qmdty haye agreed ps! enter his Production Shadpg Fontme! t~ enabkExplo~atim aj~d Dmdopmt wiihh, and e~ploitnhn of htrdeurn km, the -tract Area; tke bb-actor has the: Emacid &pshJity, and thi hhkcal howledge &d tkMeiil abiliQ, t~ &rry 0% the Pm1em as in a riianner ~OhoUy cmsiiikst with *ttre>Tr&y, the C& d this &mm^enf, NOW, THKRE;PORE, ir is agreed: Interpretation h this Agreement "&-ant'" mmns this PTadudm ShGng &a- ~'App~sal'mm~any appiaisal ac-ti\Fitiq, iwIu&ng appm$al well?, @epurp4s Q£ which at the time m& actiwiq is commenced is to app&se and evaluate the axknt, volume n~ the. quali~ fif Pdenm mw~a wn&ed in a Di9mvery (iehskiing the cammaM$t4: wftbt), and a11 m1W dvi-rieq '4&p~4 CQDWK'~'' means a knn?met made by the. Wtmt~r and appmyed by the DRSignated hth~rity as a part 0f.a Dwelqmen~ Plan; "Associated Gasm means Natural G& cwnmody know as gas-tag, ga~, wbich werlie$ md is in mntact wih igaificmt qumitim of Cm& ail in a Regmt,uFF and solution gas diasolu@ in Cfu Oil in a &2$ewoir, "CapiM CQS~'' has the medg given in Claw 23 oFha C; "domarcia1 Dkww3' mans a diswvery of P~OI~U~ conhmplatd in subMcIe 4.8a); the Coniramr datw ~amzaetci~ as "Cbmer~ial hductian'' wmmmces when cods$oning and test prduciion haviag bm mdu& h first day nf the first period of 00) cmsmrltive- days during wkh k average level of regular prn&Goa delimrd Em sale. on the, twmty bigbest pmduclion days in the --day period mi&@ a level pf fe&I*ar p&ductitm &f uerd by $h&R&&&e'd Authcirity; '@nlm~:t &$a7' fa= the wa q.&i&ed jn Annexes A and B, but dot qty p&-k of it which ha& B~ed ~~lbq&&& undm Mle 3; "CCmtt?act YqYI mema g pentnd ~~mm~igig oa ihe Efbtinq Date, arm my a~vamry. of it, md $ndj,a& imrrr&atcIy b&m the next &vm~ ofit; 1 mddp66 Rwdm dl @u@ on, ar related to, the same geolag~cal sttlp~tmk. or smtigapbic k~nditibfis, 4& I.. L . . t- &y '. . . @ which contain hjdrocarbnns in a liquid state in the kesemoir with Or wita6ut hciakd 6a~ and *? which fix& and Associared Gas may ht pil&uW "Y~~~mrnision" me&&- in mgect of the,C%nm& Area or a pal of ?t, a5 thk cSe may b% to, abm&, d&ommi$sicw transfer, remave and/or dispose sbxture$, fwiiitks, instaliaiitms, kquiptnmt and -ther pm@er!y, ad %ther.wor@ U@ in Pemkurn Ur).tdatibn$ in tha &&, m,cle~n UJ the sea and make it goad md ak, and to pmtm tk wvimmenc 'Dmmmisidng Costs Rewe'' map time cw+tive amount af mcwties pmvided in eaFfi Qlendar YEN f*OT tb Fuqding of the Pe~~rnmksiming Plan pur~uarr% to para8pph A 12Cd); "~mmmissioning Ph" means a plan ~f works, &' an estimate of' fpditum khereF4r.q far Dem~rn&ioming, k1udiq: enviwmmt&l, engiw&ng d f~&tity ski&= in aqpaii if Qre plm; "Development PIm" rneanse deueIopmmt plan Wr a DeueIopmmt Area, as refem& to in subMcle 49; "Effective bakn Iw thu meanhgg<\fen in sub-Mclc 23; "EqIomtion" means, my mpIomtion dvitie, iduding gmlo&al, gimph~icd, t,ewWtd and other mveys, iwe9~gzi~ons d W, and the drilling of, mre fides, siiatig~c ts~, hwlm~im wdis athw mag and tisting bpewrtinns for the putpas 6f-h a Diskwry, and all relati dxittes; "Txp1oratiw Cases" has themwing given in Clause 2,I of Annex G "Field" rn- a Gas Field or a Crude ail Fidd from which PetroIm may beprcrduW, "First Ye&' mans the Calm& Year in which Cmmemial Production mmmmm; 'Pmce Majew'' h the dng given in Article 18; "MA 66-195 bntta:tQdrC mean6 th~ ~ampmits Mlriing ad hitpest in P5C FDA 06-dB5 'Whdh, 'a1 the time af entry into ~s&mm& t,~ hi PBA 06-105 Fty Ltd, WDR SEA, LTD. md Talisman Rmomes (JPI)A 06-105) Pty La "Loan Faciliw" rn-.s my avdmfl, Iqm pr other fimcial Bcitity or acmmqdati~n (in~luding my acceptance credit. bond, note, bill af -charge pr m.wwi4 ppw; Enmce Jew; hire purchw agmment, hdc bill, hrwmd sale or pmhase -ag~easrenf, ur cmcbhanal sale apeme as @a- transaction having the mmercia1 effect of a borning); "MisdIanmw Reseipts" harthe mdg given in Clause 27 of Amex C; *W@d Gas Fida" means: [b) moliiple Rmemoiss grpupdd on, or dated to, *E same gm1agi~d struem or stratigmphic m~itivfis; in which Mon-Ass&ate$ Ga exists nawy under Resew& mdi.tions of ofpmurs. and press= "Pmi%3d~n'' means my PatmIem exploitahn &r trw aiWes, bt mt WeIapment; 4tPrsrdueti@n Statement'' bas &u.mming given in CIm 5.1 of An- C WuWw7' means B p~ad of three ram& kghwing m Jmuay 1, April 1, July I ar €l~W,$r 1 sf each Ca],en&rYq md isw@ by a bank sure@ or mpma'tiian mqtab1e to he Dlsi@tW Aukbfity and Wing ii credit ntinp inditing: Ihht it has su&iciat war& td pay i& bbli&~ati in all wonably fomeWe ciFcumstance$; 'Treaty" means the %pr Sea Treaty bemeen he &vammt of Tirnw-Wta and tke &vermnent of Australia signed on 24' May 2m2; "United Stab Dollm" means h Iawful mmcy afthe United States of America; "l,Jplifia' hw the ming gi~ in C~US 2.6 of &m c; "Value crf $r,bdwtim attd Psibng state^^'' Ilas the meaning givm in Clause t4 &Anhex C; ml "Work Programme atid Budger'bwds a wwk prowme for P,Htnlenn Qpwaliorts and budget @atfore appmved in accqrdawe with tM Agrqmml, used htrein, headings ax+ for cmveniance and do rraf fnn a p-i &, and MI mi mt the intv-ia'n 07, this A'@-&mmf., (a) the ward5 "imladbg* wid 'Pin g&d&bshPl be eoatru& as be& by my of Ilwtmtian or emphasis only, md &a11 not be wnstrued nor $Id1 &ey take &f M, limiting tho g~lity of my pwmg words; he Sihgdar includes the plural, and 3iw vmsw an agrmrnent irPd* &i tslgaLPt, wbtber or not having the fme of,law; a refereace to ttte mnmnt or approval af*e Designated AutkiQ the GOn$mi or tppmval, ia writing, of xhe Designated Authority ad in w$eobW with the mditibns af that wmmt or aprnl; "Paw"" include$ tbq Treaty and the 'code; reFermoe to any Eaaish led m~t, term, dart, remedy, method djacial pceding legal -d~mmw legal ,cmirt w af5dal iu. in by judi&ction 6hr than &glarrd ad Wdw a reference tu what most n&dyappmximatw ia &t jImW&an i& t?M r&rm&; '"t;Qnzi@ausla'' w aSub-Blbck or z amba of SutP-BTcda hiving a point iD,Wmm~fi 6% another such Sab-Biock; 1 Joint and Several Uabfltty If the Contracror is more than ana pmm, the &ligatipns and lia&I;tim af the dnntw'cw under Ulia Agrment are ha obligations and liabilities of them dl, f ainU y and swemUy, id] The wpuintment OF an Operator by. the @anmctw ittall be mbjecf to prier app~d by ihe Dk&grfattd Autbori~ whe at any time and hrn time to. time, and whether of its om volikim or at the quest of tbe Crsntfactbr, may (il add Sub-Blocks then in the Gmtmet Aka ta; (iii) vary by depth within the Con!mct Area, a Gas Retention Arm as may be required to ensute that it encompasses the GEE Field. fie Confracbr shall relinquish any part of &e Contract Area removed from a Gas Retention Area as a eonsequence of such removal or other variation if it om &er the time fm the f-eliwishent pmvidd fur in paragraph 3 ,l(a). The Gas Retention Area shall be deemed to have hen ~linquisbetl on the earlier of (i) expiry af the period mee~oned in paragraph 3.4(ah j] ha CnnmctPr ceasing to meet its ~blif@hs~de~ pmg@ 3-4b); ad [iii) the &ntr;aehr dedaring a Cem~wcid Discom in ~sgwt of it md the Designated Authority declaring a Devel~pmmt Arm xs a consequence thereof. 3.5 Oil Retention Area If the Appraisal of a Discovery of a Crude Oil Field demonstmtes that the Discovery, although substantial, is not thm, either alone or in camhinatian with other Discoveries, cammercidly viable, but is likely to be~~m~ rro within Rvir (5) years, the DesignaM Auth&ii~-niay in itii aBsaIute discMdn, at We rqu& crf the C-~~ntiacw, ikc4ard an Oil Mention Area in repedt bf it, bt kr@ part flereaf, fbr that period on su~b terms md c&dit&id ab W Dmi@ated AuWrity tansides 51ppfapTi&W- Work Prugrammes and Budget 4.1 Camntitmeht in Exploration Period In Conhit Y.s I: 2 and 3 mesniimed bolbw, the an-r sM1 wry out an Expioiation Work Ptmamme ad hdpd uf not, less thin the met dwhk qa~ifiikl fbr he!w GmW Yda~ bd~w: dqmct Yqm Data Evqluatiqa %pwys Wclls 1 -2 EYagmtjan of Nil Tm (2) l3-m drillable pspwts, wpbdon .wells. Jahd h Kuda Tmi Escav~ea and &a Twa @$ coufingant outcome: af any myhta'tim or eqlozation appraisal welb may drilling bebe;drll&~in Year3 Ev@Lu&bn of 1,2w3. mpIa*on wa results. 3 Evaluation of NiI axppfomkion wdI rE5&. L 4.2 PerFarmarrce of Explotation Work Programme and Budget: [a Xf any wdl forming part of the Exploration Work Pmgmme and Budget provided for in this &tide 4 is abandoned for my masan other than a reasan specified in paiagwph 4.2@) More mcbing the defined objectives of f ch wdl, &e Cantiactor shall dritl a spkpstitute wdl. In this pent, the Exploration Pexiod shall be extmded by a period of time equal in length to *e time spent in preparing for md drilling the substitute well, includiragmobiliaation ad dmabilisation of the drilling rig, if applicable. Unlesx otherwise agreed by the Designated Authority, my we11 which form part of the Explamhn Work Programme and Buds provided for in this Mclc 4 shall be drilIsol to such depth as is necessary for the evalutttion of the geological hatiation established by the available data as the met forination and which Good .Oil Fidd Pwtices wnlrld requim the ChnmCte t~ attain1 unless before reaching such dep&: 8 Emm'tiOn stratigmphicaIly aMer than the &vest target fmdon is mmunkred; firfiber. &ilirr$ %ai&I ~Mnt hii Wms @anger, swh as blrt not limited 'to he pence (ili) of,&mmal pmur6 t5r &xwiv'e ios&k Bf ddling mad; (1 lth~ Cpnlnctar and the D&gakd Au&ori$y ,ye ro terminale the drilling uprxti~n; 01 h swh ebwstmees the &i21i11g~+-faity s- well may be terrainate8 at & ltfsser depth @id sMl be deemed to have saM4 thw'C~mcbr's ql~$gnXI:w in re- Nth? dl. Where a wdl whch hm~ pati ~f the Ex@o~on 'Work Progrmrnr: and Budget-pmvided for in this Article 4 malts in a Dismvery and & Cmh&t-infurnu%h Dsignakdhtbritqr pursuant t& sub-Artidm 4.7 &at the DiScbwq merits tdw well wiIl be,mt:a to LYB met it+ objdve and to hawe s#&hed tk& ConFactor's obfigattags in rexped of WweB If, in the Initid ar $emd Exp10mtion Period, tbe Cm~hcbr 6am'e oqt less Explmatim ffim is ~uhd of it dm the &pl~mtian Work f sopamme md Budget, ihe Wgnakd Authority may: (9 quiret&atfh~ig; &m&1 be addtit to tRg&pI~~ to he cmid .wt in next Petiod; [ic) Waak tbis mat md quire paym~t afthe estirnmd cost &-the &pkmti~n not wried out in the ExpIor&m Pdtiod. (6 For the purposes of t.bs foregokg prox4sbns of this Mcla 4> ad qf fde ,6 and hex C and excqi't with the consent of ehe De~Sga& hthositgr, no work in D.evelspment Arm will be r&d&d he E-xpl6ratioa except ,$o the extent in reqect of a feqdon deeper than the Fielid m&d and in whi& no Damtry has h made. 4A Work Pragram me5 and Budgets Subject to sub-kctiale &k the bntractpr shall carry mre-hr~lam Uperatiam syhsbntially in acwdw wiih Work P~~, and Budgets appro& by fhe %peed Autharity. Such an eppraval by #e lJ~s:si@at& ,A&oi't)r k without pq'udice & my 0th~ obli-gadon or IiaW of tho Con-r mdm this Agmenrrm'1. Wma fkhef @p@dvd by ttle Design~td AuthdtyJ the ChmMw m&y om &@ads liy ten paem (1 @a m q~y line item in m qpmyd Wa& Prrxgmpmt.md Bedget. witbout further qpm~d by the Deignaid Authdly3 &e total &fall ~va-~~pmditukes under parzg~pb 4.5 fa], under wt Work hgmme and Bgdgqt !&r &at Csdct Y+w $hail ~QL cmd terip~rni 00%] of thetotal expeadikes in tbk Work hgwnmewd Budget. The Conthetor sWll proanpay hEm fhe Designated Autka6ty 8 ii mttcipa'tes (Or dwuld (G) te&gn&ly ariGd;iyate) that any such limit in paagraph 4.50 wS1 be exwdd md &, in the mmmr paLovid@d in this Artikle 4, an amw &neM to the appqri* Work Prwamw md Budget. [dl Is Ile~ermining whether W aappmve' the wcf-expendims cpntempiated at paagaphs 4.5@] and (b), the Qrlsigna~d 8 Aufh~rW #!dl coqider w~~r such istrems.~ =sag to compIate the prwmme wf wow, prauL:ded that such im-o is & the result id my fai~uwaf the Contractor b fulfil ib abl+&ms under this Agreement, Nothing in mta-Article 4.4 or paragqh k.S(i3 preoludes OF excue the Con*tr&&r hrn hhtig aU new and proper mimum fi5r the pmk&im of £if&, h&Tth, the ehvimmnt and p~6perty If tRm js in &mency (iri&u&ng a $yificmt fW, &qWs, Fetmlmm release, &bMq&.~:; kcidmt iir&Sn$ hs$ Qf life, ~$0~9 injury rs an emphy&9 ccinw gg Wd pa@, or svtrida3 propem WaG s@iks and &% or e~rstch@iwk 6f the Qpp3tot.s @~iuIeE)~ km w? a$ r&gm&ly pmt&bke> $he Op-r will inform &e Daigriatql AukdB ~f the &fails gf &a em-@ ql of &e %@QW it has Bhq and intends t~ +&E. (a) l%e rnmcto~ sbdl submi$ FBT the appmvd ~f the. Daignated Aubotip, aa Eqlmtion Work hgrmrn: mid Eudgetfor ewh CmW Yw. ) From time to tome, thq &tFathr may submit, fw this- tippavat af the Dd-ed Aumrity, amandmew s Qs Ex plsratiaa W~k,Fpg~er6eme and mdgj As won as masonably pmtimbb afW a Di.sc~vmy b made, $b d~mr shall advisa h Designzted Aulfierity whether as not, hawig regard h paragraph 4.7@), the Diswvay marits Appmisal. (c) At w& firm amd in such rnmr as the hignd Authority rrsquim, the con- shall submit for the approval offhe Designated Authori~, an Appraisal Work Pv and Budget for each~cstlendztr Yw. da Horn time to the, the Conmmr may sqbgit, for &E approval af &E D~igmW Authdd~~ amendmen& to the Apprdsd Work Fmpmme md Budget. (eJ An App- Work hgramfs~ and Budget hr a Calendar Yw will such as wmtd be undixkiken by a pmon 5mking diligently to Appraise (in accdam~ wi& this Agrwment) a Discrsvq with a view to determining if it is, either dam or in mmbinaltion with atbw Discnv&es, a &med Discoveryerls [a] Tb Contraklm may, at my time d hatring reg& ta-pmg~apb-4. !3@h dklafe ht a Cmmerd pismvery ha$ beeu m$d,e. The di+xlaratim is to be lade in such manner, and be acmmpafied by su& xvpporting data and infimatim, as+ the Designated Authority requires, including the Contra~r's PYQPOSL as to thelt part afthe Contract Arca b Tic dcclmd a Dmrrl~rpment ha. Tht D&@aW AtIthariq LhdI dmlwe chase Sub-~ue& whch e'neo&pass fha Field in whith the Commercial Rni~CWtry SPias, been ma& ~plu8 s ream& margin 1uft%a1 to mver the probable extent of t&e Field, W ha a Devel~~~~mt Area, but may ex~lute dmpw famations in which nu Discovery Iys bcl md~. lie Dtsignatd Authpriiy, atmy time and fmm time to rime, of ib own udititan UY &at dxhe Cqmact~r~ may: (iii) vary by deph whin the Contract Area, a Developmat &a as may be quhd to mmre &at it mco- the FieId osnc&xed, kt not,, ttPe Desi$mt:ed Au&oEi@ and the Cfan-br o&&se agree, nhr the Develaprherrt PJm in mpxt of the Dm~lnpment Area has bemi appmved. Tb Chrth-acbr &dl relinquikh any piit of tbe Contract ARFI rmutrd from pl Development. AIW,~~ 3 asequenw of such movd of other vdaf OR, if it wcurs -&ex fie Bmf! f~r 'che mbnguishent provided fm in pampph 3: I (a]. Not more thn Wehe ($2) rna&'s &mAhedec%mtian of a Development and in &e manner reqaiM by the Designated At~thPPity~ tbe Cmmetbr shall admit, fbr the qqrclval of the Daignslted Authdtqr, a Pewlapent flat^ fbx ~IB Deve1apmwt &% From time ta time, the Canme magi _submit2 fw the appd of the Designated AuttrhQ, amwhents to the DeveIopment Pi-. A'DeveIopmmt Pls wiLl be assased~~n the Wh ~f whether it wodd be mddm by a person setking diligmtly toI &velop and exploit (in accmdhnce witb this AgreemetttJ the Pmlwm in the bdbpmit Area in nc~a~e with .Good OEl Fidd Fratrim and in n wy that pmmw fi* iavcshm-d and c&tki'bui& Zg thc: Xsng tam devd~prnerat of Tjrnbr-bee and Aumlik [) th~ecommiasianing costs. (a) Prior ~GI ~ammksiq&& %cwity p""ant ta the lhmm.rnisioning Sexmi& -me& shall he, provided by tk Contractor in an amount e-1 ta Be sum of pmviinm de t~ the Der;dssioning Costs Rema, srnd Wen as Rwwerabb Ca&, in dI prnvi&s yew tdgdxr i9ith kt- w m& RecovegabJe Gas& wIeuIaW to the end of h pre%w Caladw yea^ at the aweImte of Uplift AfIw D&&ssionir@ +t3?ems, tb Desigaakxl Authority at tht: end of wb. I=&indiu: Yaw revim tk iwnorprt, nf Szturiq requhd for t31e ou&tmding ~ionhg~rnd ahdl fake intw~n~detiw my Dwomissioaingqsts that have &ready been Incurred. (j Fdlure of the Contractor pmvide Sa&y and ohmise to fulfil its ebligatians under he B~is~orikg 86- Agreemmt, shall be a b-h of %!aid Apmmt. I hpef and Workmat.rlilr% Manner a The CB~Q~C~O~ SU carry out P'ttsaleum Ope~h~s, md shaU p~m tbat they &G cded out b a proper, efficient ad workmanlike mmn&, and in mo&& with the Cede, this Agreementtwd Gmddil Field Praktice. (b) In partiMar* the Cantrmior sMl carry out Pmleuirr Opmtio~.~ and procum that hey are khded au%, in sukhamm~~ iisisrq~i'i by+&aph $.l[&] to: [ii] ensure the aafgt-f, health and welfare of pmm in or about thePeml~m~ Upmtinw; { maintain in safe. and mad condition and repair all stmchi-es, facilities, il~tzllIalieris, equipmmt 2nd 6ther prop*, and 0th works, wed or to be used in Pmlmm Qm~ims; (aaj temiaathn of this ApeWt; and and, in dm ease; abandon, decomission, -fir, move dw &spo$e nf all structure+ faiMw, irrstall~q cquipmmt and OW propertyJ clean up the ha and make it gomi and We, ad pxatect the envimmmg to the safisfkhn ofthe Wignated AuthoritSr; 6) cmiraI the flow and mait the wade or acqe of Petroleum, warn ar my pht uged in QFdfiVd by pro~s$qgPEml@~ gmnt the wapr: of any &twe af water or 6iibng 8uid wiih btmlmm or q~y other matter; [vii) p~vent damage $0 Petrol=-bearing strata En or outside tb sect Area; [viii) exGep-t .WriWthe msmt of the ~gnd kutbi~, hep separate: hiaimha ink&m@.e with navigari6n md Bhing and (XI 5.2 Access to Contract Area 5 Health, 5af.et-y and the Envirameht Within three (3) mmth tif EfFdvt Date, tk~e CPnmfor shall submit to the Designated AuWty, fir 5t$ approvd, plms In regard to: he health, safq and welf~euf pewna in or affected P&roleurn tJpersrticn~; and (i] jii] the pmhti~n of the emhnment Fntludi% the marine envi~mmart and tdnc dtwosphere alrd the p~rnnhn sf poUuti~n& in order ta Mwt fhe ri&s.tq the pW1~1yel md tbe mvtmmr* ar~ as Iou a5 rmmnbMy pm@wbIe. The plan$ &all be revimd annually and mWt3'eE ficm time To time,% may arrying out of Pts&31mrn Operadons bS1 its apqa fir ~~~ dws not di~vq the Operator (ar the Cmtacta] of ;any obligation ar fi%baiW under th A-t. 6.1 Generally a] The C0u~ctar'~awunt6 shBUj~pmp~ed and daiaiwd in acco~hw. with Annex C;. (5 Ody w$ts mid qems bawd by fie Q13mlvr in c>arrying qn P%~mlam Qomlim ind:Iu&ng addifions tw&e l3xmnmi~sioqing Cssts Bmep~ and (unless he Cmtramr is only pne pmm~ Ad he ChnWetur and atbe @eixtw are that gmon) pmprfy cwd to Cmtm&t under an agreement made between &em and mnmkd ra by the DeSigvated Auhtity, .are kcavmable %osts, but withmt prejudice to my other prwisim af this +mat which would resuk iamy swh msvnr pa%^& er We~~~hblk 42&. Ih C&I an8 evey Calmdm Year, Kettrverabl'e Cme are, abject as'funl~er pwr'dd in hiex C, he sum ~f t?lwe of the f0Uqwing thal af% not hdigible COQ: i Ravtmbla Appraisal Costs: [iii] Rewvam?,Ie Ckpid Costs; aqd (iv) R=frwmble Operating Costs, incurred in thai Ye [b-1 additimm the Dkcomimh&g @bsk Reserve, if my, allowable in that Yeas; Rwvmbla Cos& in the previous Gate& Ymf -b he merit in mas of the value of the Cantfar:br's share of Petroleum under sub-pmaph 7.1@)[i) in that prevhus Calendar Yea plus (4 a Qmerly amount qud TO ehe. product .of the & sf UpJifk and the Quarter~ly balance of the mt.&mdbg ~cuv~e Costs; less Mhd1anwu~ &mip& md less any~dedwfion~ pmuaat to pmgmph '3.4ta). Sharing Of Petroleum In each Gal& Yew, the PParfies shall take and mehe the following sb of every grade and of Putroletrm and *lien it is delivd at thr: Field Export Point: any Petroleum not tab by th Centtactor under sub~pampph 7-lMji) 3M1 be 3h& as ta f0@$4D) pe-t by the Dwipted Authod% md ;ns to sixty [m) pmmt by the Cantractor. Tfr@Desimatd A@h&ay mdy make im ekction tq take and sept&ety dispose ofthe lhignatd 6) Authority% shap of P&olem. Unless tEre hbwtgr &wise wm, which agrmmtnt will not ba u~lrexm~bly withhdd, the Designated Authority may not so deet &er than: 03 in reqmd of all, or the same pmmtage: of BI, ~f the Dedpa-tM KYthagw's awes. u'C Ce Chi ibr anif'thoughaut each Cdladar Yeari on not less th& hheq (90)days prior wrim natiwta the Contfmm'WM tksm aftbe Wen& Ywr koncm~eck (1 Subjeot to &a Agreement, the Contiador my lift, dispose of and exp~rf Wm UK EDA it5 sh~ of P&rol&um md retain tbe pmceeds from the sale or oWr dispositi~n bf that share. @) 'The CD~W and the D&gmtd Authority sbdl, hm time b 6- make smh agreements. Ween '*'^as ,we, msma!& nt;cessaq, in accordam$ with Good Oil Field Fhqtice md tb$ cnxamwcial @cat$ the +m&mal petroleum indwm, fgr the sepmate lieg oftheir sham of PcWIeum. (a) t)etrolam shall Ix at the risk pf &e CO~~QP Uatil it iS &livered at the Fidd Exptlrt Paifit, Without-preiut3ice-h any &ligation hlr liability of tbe Cmewtor a$ a aeadsegw~e of a failure cif the Ca~rncto~ ta corn& with i-as aMi@aw under the Code and dis Apmmf (hclnding $6 Mcle 5.fX P&~Ieum which is imt 1EGeY it is reaverd -at Ure well-head, and befvm it is d&zlad at the Field &port Paint, shall be deducted frqm tbc Canhwtofs RecovmtbE6 uda~ ~b-.&fi~l~ 6.2. ] Title in the Conmctor's shafa ~FPetfahm shall pss.'po it when (and risk thmin $h;lndl hdin with the Cmba&r aftm-1 it is delivered at the Fld Ewrt Pdirrt. (G) Ti& in the Designated Aubrity's. &are df Petspleum tdml by tkre Contmctpt pmt IQ sub- Artide 7.2 shall pas 10 the. Cmtraaw when k@ r5k thereih shall main with the Contmetm -1 it is delivered at the Field ExpplZ hint. d The Cantractor 3W defend, ~~~ and hold hdm the Designated Authodty stndor &e mmbs af +.he Juint &mmis& ha @i cI&ms and demands asserted ih respect of Petroleum wherein the riSk is with the eQnWtor* (a) Wnlm the Designat Author& has de an ddm under gmagmph 7.2&3], theVC.ot2tWbr fgmU pq to thq Daigated Awt~rity w amant qud to tbe D&wed An&&@r sham of dI moun@ Mved by @e Caq~w Em tlneRWwm within Wdy si~ [3&J hu~ ~f qipt. H &E went that fie Conhetor ha& nat meeivd papent for P&oleum witliin.$xty C6Qg days of pf~drscti~~, it n&&h$& Will &a a pravfSion~I payment to the Besipfed Authdtjr of ths estimated valw of the Deif$rl&cI Rtli31witf5 of suEh Ibmlcum. Valuation of Petroleum 1 Point and type sf Valuation The va3u-e of Cm& Oil %Id f o-b (or eqivdent) at the Fidd F~ht in an am's length mimaion is the prim ggNle far iq %Id in .an am's Imgh $suls&dn ofher Tbzm f+abb (or quivyt1bdt) at ate Field Export Bbirlt is the prim pay&k f~or it, let;,% mch fair and r~~sorna?le prognrtian of such th& refates to. the transporntion, prwessing ad delivay ofthe p&oleam doq~ of the Fi4d Expmt Point up the amal point sf sale; QT ath& rneniiond in *graph g8z(a) mid &> shd1 be the fair and mqonahla market prlce Wmf having regard @,dl &it L~~IZ~~IICW. 8.3 VAue d Natural Gas The value of Natural Gas shd be-the price payable under the Approved Contrad or as ;tsthwise may be pvided in the Dkvelapment Ph or in this Agreement with such fair aid reasonable adjustments w Nriiwl ra reflat the point EZnd t@e ofvafuatim ~JI sub-Mcfe 8.1, or where a Cantractor enters into a saIe &er thw atmYbImg&. a4 Price Payable h rhi Article $ the pFJc.e payable. is the price that L [or dd be) gqble by +%byes Sthe Petroleum weit ladivered by tlm Cbntrakr and tahn by the buyer, without set of??, counterclaim or &er withholding hWe. Article 9 Payments g-1 Pees All pmts t&ik this Agranmt &a11 be made in United Sbh Ddlam, unIm demise a~ md wifhin tea 00) days &er the end af thc m& in &ch he obligation to make Ihe payment is burred to a WnkbqxCifjd by the Party to whom the payment is &a. Any mount not paid in full when due shall bear interest, cumpotlnded on a rnen&Iy bask, at a rirta pet- nnnufn equal ko one hhth tern, Londm h&&k Offer && (LIBm] far United Siates Dbllat &mi%, as published in Lxmdan by the. Finmcd Tima or, if n& $0 ppubliibd, hm publh%d ik NtW YO& by The Wdl Sw 1g.umalj sumt 'mm day to day, pias five pwqntage yoiatq, m,and from &e due date for pwnt until the atlowt, tag&@ pith intyef &ma% is paid in frill. 9.4 Minihum Payment If this Agreement is terminated for my reason bdom 9ke d of the second (znd ). COUIC&~ Year, ?he Cunmctm shall. on such tetminau'on, pay, to the Designated Auharity, ihosti Ra which it mid h&ve paid under sub-Pzltide 9.1 if Wminafion bd ncrt occwrtd until the-md nf the smomd (e Contra& Yts$r7 Article 10 PfqviSion af Goods and Services 10.1 Notice $1 Except with the ~rmsent af the Ddgt~ated Autho*, the Co&mr Ad1 draw to the atkntian of mppIim haserf in Timr-IIeste arld kmWa, in s#ch manm as fie ksigmtd Authasiq agrees, BH opporhdtiw Tor the p&Yision of @& ad services f6r Ibemlmrn Opmatians. (1 ~ub@k try $lib-&cle 10Za athe Cmmcms shall, befw awarding my mnm far gm& w gervi&;oeaia the witten approval af the Designated &r&wityS Appmvd ilm l3e B&i@ Authority 3w be &tagd my (303 d&p a"&r Wfke of .do; aw@ is &- by the Lbntra~t~r, gdes otherwise notified in writing b fi~ Conk-. 102 Contracts Hat Regvirirrg &si$naied Authority's Approval Tk CanWtsr m;ly de rmmm .Ear g~& and mi- frrr Petroleum Operati~ns ktkmt the DesatlaW imthbw~ consent but not jf'fas prapty & be les& ta the aWad8r1 wber~ a) the Conmd (or ~liftcd mi85 of .fnmd3) is expect& to iamive expendike of ia &@a Eve hundd &amd (304@0.00) United SWes Dollars or mc13 higher mount-tbet may be speciEd by regulation; w the corrtract (or relared .&a ~f ~wntrrtFf6) is expecbd to involve expemiihre of lm &an two million (2,000,UOkOOJ Unit& 'States Dallas or su~h ~iher amfmnt that may b specified by mgdathra md the &;a& or sqvim8 arc nquircd in xcspcct d a Uw~ldpment Plaq abe L:Q* af whch 2 expxkd iu Wd W @i@n [~Q,U~OOO.O~) United 'Sw Ck,b or such higher mouat Wmay be specified by nz&aiRn. 103 Tender ln'wit~ris (aJ A11 imitations to tender matie for the purpose al pmcwin~ pods and servitw shall be published in two (2) af Ure nm.Fpapefi with bmahiest ehlatimr in Timor-Lme and AuS&idia or a0 weed with the Ihsi~zitkd Authority. From time to time. if pqaeskd by the Designakd Authority, the Canhiidtor shalS withh .sixty tB0) days hTter mh ,request submit ta the Desi@ed Auth~fity. derails wf @Q~B and whdly procured both from mp~lia% based hiaide outsih Tifnw:L&t& aid Amtfalia, Article 11 Title to Equipment Spbjmt tg sub-A+ch 112,dl s&qctum, fdLties, iiastallatians, equipmat and aer ,pmperQ, and other works7 4 c;rr to ba used in Petdam aperation% shall he and wain the pmpm of the Cornactor while so ud w held far use, unless CoffWm rcq&~t~ md ~b+%&,dpwmd fh% ihe Dmig-gnated Baothority hr. in dtemtiv@ mgemmt. Thtr Designated Authority may, upon kdwtion nf thk Agcwnent ia respmt d dl or a p& d the Cmet &a, ekt to sguie my pmraym rr~~w0~k.s M gentioncd in pwgraph 1 1 .I {a] imIM 6f~s QT med exdr)siv,r:Iy respect DG hi qw, by giviqg the CmtraePar a mfim to that &a& The Gntractor shd he nu Turtber &ligpfiltion or liabdity in F~SW~ crT my pmw or other works- acquired by the'Desimted Authority pmwant t6 mph I l.2(;i) &ut +&wt pmjudice to obligations and liabilities amrued prior theret9')?,&td will rqxy, to he D&@kd Authaity, dl arnlrunts WluW in rbe Dcmmdssimhg €%& Regme claimed by &e @a~@azhr udrr Mda 6 in tespe@t ~~lt before the a~qui-sition, and MI, subject to ppph Il.2f~)~ daim rm WCG sych mm'&s in resp~ o-fh. c in respect of my property which hm no$ been hfly cwt remv&ed, the Daignatd AuPho~ty shall upon deeting to acquire mch prom pursuant to this &-Article pay, tbe Chnimttrr, Am slrnomt qal to the un-recovered em$ of bte pmt.ty, Eiichdiag Uplift, dcukd at fht: dtzte af the d don Got the pqma &as mb-Aaid~ it is is~8 &at w%Q are remv& in the order in wW& they m intmd. ArticIe 12 Consultation and Arbit mtiori (1 I!? .a ilis@ute ad%% between the Besi$rraW Authmity and the Confacm relating to the intmp~~on and mbce af this Amw and relevant @mvEsians afthe Tmty and ike Code* th t part& &aET ~tfa3pt t@ Wive dispute by maw af mq$&tion. @) If suclr a dlspte mmt tra ri?snlvd hy neg&tim witbin a Wad d &eW (90) days of wtifiatirln by either patty of a dispute, cithep pa%y may submit that dispute to arbhiion in amoi-damawih the'terms set out in this Mcle 12, 125 Procedure a Arbhian shall be coxpducted in aseosdan& with the Ih&s of ArW-ati~n afQnW hb&tirn& Chambm d &mmer~e [KC). The X%wi.gnafed Authoriiy and the Co&.a,ctor shdI #a& paint, we arbitrator and thae.mo (b w~itat&rb $!dl qppitit a third. If either Party faiIs appoint an arb&aiw within thiw {3,0] bays after rmdp of a ~db rtqumt to do SQ, such nrbifrat~r shall. nt LII~ d1d Pwty's 1w1t1-e~~ if tI~e Pmj& 80 nut otherwise agree, be a@ainbd upon appli&ti& to ICC. If tbe fist two.arbitmtors qppointqd Oil to a@& bfi n tlud witbin thirty (33) days of the second arbitrator hirig appointed, the ih~d &itrat~r-shdl. if th Parties do mt otherwise he .appoint& at the niqate of eit her Yarlyq up appliwtian to ICC. Tf am arbitratar figs, &r i-s unable to set, &at abi'tr&O$s sumemr shall be appi~ted in the sane mariner as Ihe dimtar who is ~pid. The rndjorib decision af tb arbitram3 &a11 he find and binding on the Barb. &I aw& made may he mforcd in my cwrt hviug juri$di&an for the purpose. 12.4 Gommercia l Arrangement: Waivrw of Sovereign Immun lty (a1 This Agreement is a cmmer~id agrtsm&. b Bhth Be Designatad A&&@ md the Canh-a~hrwaivc my cIah to mreign imnlmiv which hey may have, both as to process and executi~a. 12.5 Obligations Continue DurEng Arbitmtbn The abligatims of rhe Padies wdw the -ent shdl continw pending the resdlutir)n of my rn* mbmiW ta dihtian. Article 13 Financial and Technical Data, Ret~rds and Reports 1 P-h lB.l{a) inciudm dl mw dab and idomdon (jncluding cares, auttinp, sarnpl~~ and all BobgimI, 'gqbpid, @&mi~aI, drilling, well, production and e&nmrltlg data .and infohadon) W &ntht#rPmil&ts ahd empila 4ir~hPetmIeum Options. It does nat inch&$ Mad &om special m&& ~ecd OW by tjr fir the &maat thaf &es special pmp~taxy s@wm UT p~Odm~i. It aJq #Q# not imh& i~qmians @,have peul~ cammenid or mgi~nal simce ra q Coetm-cm [over nn6 dmve #at t.& is mcway for the mmmercial evaluation and .&valop~~e.ut of a bqt Arm) anai in msp& af which the eligible r%coumbb cost a~butable ta the CmWct Area is,a small pqmtian of &c t8taI cost of the ihtqdarre Records, Storage, Retrieval and Su'btnision 13.2 The Contractor shall Bep full, coqlefe and accurate boob, accounts and ahi- rccordq of Petroleum Dpemtions and of the Sale Or other cfispasi6m-1 of Petroleum, of the data md informatisri meniioned in sub-Mde 13.1 and of all &cr financial, eaii~inercid, legal, ~perbtion J, tkchniml aqd &er data md inkmatitian acquiml .sr gaerat&i fw, QT ~e~ultw, directly m inslre'tly, from, Petrolgum wmtion.~ (including that rdatitting to n;l&ebg ad pthewise to the sak,sf Petroleum). The Cht~~r sbdl make the miginals ar copies ;crf all such data, inf~wti.~rn and mzm-rls wajlablc to the h1hpity (or m it shall direct) at ramnabIe times at the Operator's offiws in. Emor-Lmk, and shall psm$y daIive~ fhe same to the Designated Authority (or as it directs as .and when, and in such manner as, th Desigrtatd Authoriv ~ifim. Without pxjube ta paragmph 1 4.2@j, the Contractor shall sfm all w& data and iirformatbn t!i-eADesigmkd Afiariiy, afk emsulGtiw with the b&&ar3 reamrba'b1y dimts, and okherwi* in accordance with Goad @il Fie!& PmGt'Fm. d The Conmcror may retain cppies af all swh data and infomation md records ddi~qrqd tp th~ Designated Authwity TOT we in or in rdathn ep Petroleum Opmfiorrs and in wmplying with obSim under law, but not otherwise without the mmmt of the Designatmi Authority. Except with the conmt of the Desjgmted Authority, or as qkd by law or the des af a mognised stack exchmgc, th Con&ackur may not sell DT &=lose any mtch dat$ inf:~don arid words without the cmeflt of tbe D&i$nated Authority as as 0theh~ provided in ihi~ Agreement. 13.3 Reports The Contractor shdl provide ha Dmigm&ted Anthori5 with such rqmm as a mentioned iin hnm C and as the Designated Auikori* durn. 13.4 Export of Data and Irrhrmatlun No such data, iaformati~n and ndr& shall be taken out of, or transmitted hm qr stmid outsidq Thor- bb or AuMia without the consent sf tho Daigpated Authority, which cons& slid1 not k witkld if resomes fnr the pmcessiag, interpmtatian or analysis hweufare nbt adable ih Timor-M, if the data, informati~n aud recur& are praqtly returned to Tiam-Leste or Austdia and itctcc@te copies (or us&It and representative $ampl~s) am miained in Timm-Me or Ausfdia. 13.5 Use of Data and Information [a) The I)esigoa&d Auhrity may male svrh usc as it wishes oftbe data and infomation mationed in this kicla 13, and aasng in sub-Mde 13.6 or f3.7 prevents the Designated Aufharity using data and infomation for the purposes of gad *tistid and oacr general reporting (publicly br otherwise] on its activities. (b) Except wif5 the ~bnsent ofthe Desjgnated Authority, the C~ntmctm may only use the dab and informalion mentioned in subPuticle 13.1 far its Petroleum mations or for an appliari~n for an Auhfiwtion or for reporting infmatioa ta its Bate provided that the Authoris& Pwmn first procum that any such hffiltfks agree a be bwd by this paragraph 13.5@$. 13.6 Cortfidentiality of Data and I nformatiori Ekcept as ofhtTWi* provided in tkis Agreement or with th te of the Cantractat., the. Designated Authatity shall not publicIy disclose or, other than for the purpose of the administration of the Tre;tty or the Code, or as othawise required by the Treaty or the Code or for the purpose of the resolution of 81spub under this Agreement, make available to any persm, any data or informaton. mentioned in sub-Article 13.1 until the mliw of: five (5') years after &e data or ininformation was acquired by the Conkactor; and (ii) this Agreement ceasing to apply; Ex?@ with the cnRserrt of the Besigmited AMhority, and In accordance with the conditions (if any) of the cansent, the Cantmixor ha11 nat disclose the &fa w information mentimed in sub- &Ie 13.1 other than: ta its employees, agents, contractors and Affiliates to the extent nmesaq for the proper and fi~ient wing an of Petroleum Operations; {ii) as required by law; (iii) fm the purpose of the,mdutiun of disputes under this Agreement; or (iv) as required by a recognled sack kxchmge. The ~ulmctw shdl pmcure that a person mentioned in subp~ph 13.6[b)(i) maintains the data and informdon disclmd to it confideMia1 in the terms &this WcIe 13. 13.7 Trade Secrets Except with the consent of the Contractor, and notwithstamling sub-Mcle 13.6, the Designaicd Authority shatl not puMi~ly disclose or, other than for the puqme of the administration of the TreQ or the Cde, or as othetwise xequird by the Treaty or the Code or for the purpose of fie msdutim of disputes wider this Agreement, make available to any person, any data or idormatian submitted ta it by the Cmtmctvr whick (i) is o We secret of, or other data and infonmiion the discfosikre of which would, or could reasonably be exwed to, adver3eIy aff&t, the Coniwtw i~ respect of its law61 business, ~omcial ar fir~awial a~~-~ (ii] was cledy marked as such when it w,a submitted to the Designated Authority. Without prejudice to sub-paragraph IJ.7{@0(: fi) the mignatd Authority may, at any time and from time to time, serve notice on a Cantractm requiring it ta show muse, within the time spaifid for the pwse in the notice, why inhrm&on which it has marked pursuant bo sub-paqmph 13,7@)(ii) should still be considered a wade sect& ~r other in&xmatiun as mentioned in that paragraph; and [ii] if the CantraCtbr dot-% nat, shaw cause within that time, &e data and infomation shall no longer be a trade secret or 6 such information for the purposas ofthis sub-Mcle 13.7. Article 14 Management of Operations 14.1 Constitution of Committee For the purpose of this Agreement there will be a committee consisting of four (4) representatives of the hignated Authority, one of whom shall he the chairperson, and the same number of representatives of the Confractsr, as nominated by the Designated Authority and the Conmor respectively. Fat a& of its representatives, the w~~ Autbrify and the €hnkmmr rnay nominate an alkmte to act in the absence ~f the aepv%entative. 14.2 Meetings (a) The Carnmiffee will met at least twice in each yq in the D@si@ed Adhity's ~ffrces or such &er place as the lhipatd Autbrity may advise upon fie chairperson giving thirty [3U} days notice thereof. There shall be at least me meeting of the Committee for mh of the %flowing purposiS: examining the Work ProgrAmnes md Bd@s br he foilowing year which the Contractor is required to submit under Article 4; and reviewing any propad w agreed amendments to a Work Programme and Budget; reviewing the pmgress of PetmIeum Operations dtr the mnt Work Programmes and Budgets; and discussing any 0th matter relating to PehJeum Opdons, @) The ConMar or the Designated Authority rnay quest a m4ng of .the rYamrnitw at any time by giving with notice to the chairperson. Such notice shall include a 111 description of the purpose of the meetirrg. The chairperson shall thereupon give notice and call such a meeting. Article 15 Third Party Access 15.1 Third Parry Access a) The CmtmAm shall provide for third party access to Be structures, Eacilitk, instdlathg, equipment and other property within the Canfract Area m rcasonabIe,terms and rsandihfis. The Contractor shaU use dl mn&b efhb to neghate a satjsfkmg agreement for third party acw, and where mutual agrwnmi ammt be reached, the Designated Authority & ~onsultation with the Joint Commission, shall set the terms hr such third party access aRer taking into accma intemslti~ndly accqted principles, Gwd #il Ficld P-ct and dpbrafional requirements atid stand&$. Article 16 Audit 16.1 Independent Audit The Designated Authority may require, at the Contractofs cost, an independent audit (starting, except in the case of manif& error or fiaud, within twenty four (24) months after the end of the Calendar Year, and canclding within twelve [12) months of this starp) ofthe Contractor's books and &aunts relating to this Agreement far my Cdendar Year. Tha Conkxbr shall finward a FQPY of the independent auditor's report to the Designated Authority within sixty (60) days following the cumplietion ~f the audit. Thee shall be a period of at 1- twelve Cl21 months b&wn independent audits except in tb cae of manifest error qr fraud. The Desi~aid Auhori, my insgw and audit ikif ax as it dim&% afld at its own cost, the: Cwtrach's hob and acce~nw relaing t@ this Agreemmt Em any Merrdar 'Year (stmfing within ttwity four (24) manths after Be end of fhe Year, and concluding within mehe (12) month$ of this !am). 16.3 Exceptions (a] 44 audit expqti~rn shall be mi~M by the Designated Aubfity within ski (9 raontkw aftw &~t dthg indqtendent audihrk qbrt. hy the Desigmqd An*uri@ m mqletim pf audit* ttre %ig@ted AuihtFity (DT aa it directed), as @e ewe may be, failiqg which $e C~u@actds bpaks and a:uunts sh11 ba oonclwively deemed comt except in the qe of mmi.Fes8 error or bud. (b) T~IG Contractor shdi fully ~~qgond to an audit exeeptian wi& sixty (f&] days uf its being raised, failing which the cxwptim sME bedeemed accepted, {G) AdjuslxwnOs requkd mung the Parties as a csnqcqudncc of= audit &dl be aade pmrnptIy. The Conhadm shall fully ad mpditimly assist ad moper* wid 'iiudits. 'fie Fp1~2going provisions d snbArticls 16.1 apply in respect of f*W of the Cantm~~r. The Cmtractcw ski1 we iU best edavours t~ pram= Wt its mliates coplpl y with tBm. Article 17 Indemnity and In'surance 17.1 Indemnity The Contactor sEl at etll times 'def&d, keep &&ally indenmiEd and hold harmless the Dtg@t& Authoritr and the rnen~hm Of T%E Joi~ @mhssiun against dl acti~115, dts, pmcdiais, cosWcham claims and demands whabom.er (indudin& for m~bnis 10s) which may &made or bmught agd the Det&mtd Authauity m&ur zbs: membm of the Joint &mmiss.sba whmao$v~r by my -third party irl m1akian to or in c~totion wia tbis Am& or wtti, dkt1y w mdyI, fi:m P&oZmm Upamti~ns nader this *meat or my &r matter or tbg done or pu~paW to bedon& in pmm~ of &is A~~x&II~ or in the caduot OX htmleum Up~ndians, no~~~g hat the, lhsignatd Ruthori~ wid!&. the ~II&I%~ oft& B~ijstGobmh&ion my h~ve wppmed in any rmmdr form b&v&tkm~d a t'hae smh may have 5eetr pdmd ar ~y 'the terms .D~'&B TWQ, fie Cb~~Iuibg any hibi bin niade^ dr &.re&& dven themudderj & %a 4iigXeemm4 Q? that t, k~ignat6.d Autborig &or the manbe@- af the Jcht Chumhim could have mercioed, but did n& mmise, my pow% Mi&, ~ghe ds Buthority Cg prohihi theA$acC The Designated AtPthmity mdor &e, tnwhm {includirig:3n ~rspe'ef Qfjfphllutim), %r such -amount$ as the Pesignated huthrity mires frmj time tq time ad 9@8iwiw ss requjrhl By, Qmd Oil Field Pw*iwl unlms t4 Q&gnaCed issti$d fim dqe to~im~, & mmultarim ~4th the. Saqtmtor, that the pmdal liabilirjr can qvW by >&her rrr-3, including &£hi qsmnce. (bJ AU such insurances &dl me he Beipded hfhan'ty ad the members af the Joint C~mmissiw ag ca-insured, and shall waive all ri&@ of &rogaiim aeialst t!ne hign&d ;\iu&ot+Qmd &c mbmofLk J~Ffit EorrrHiJ~i&. Article 18 Force Majeure 18-1 Force MaJeure Rdid (a Subject to the fui.tber pvisians of this McIa 18, a Pa* shall not be liable f~ any fiil~re to perform an obligation dm this Ageementtwth extent such pedormmcz is pment&, hindend Qr &Iay~d by euenkarcimums%an~es which am beyond iu mnahla mntral md the e%e& of: whish eQuld nat ticIudiag by rwnabke anfscipiltiod] and camof mm&y be avoided or owcome by it YFam MhjmmR). [i) Wure to pay mnex @) i~ the cwe of the Contractor, the law, or any stion or fnaEtion ofthegavetnmeut, of a place than Ttmclr-Lmte or Awmiia [or of a political ddivisinn theof); (iv) in &e we &f the Conmm, my MW~ to deliver md maiaPain a or to obtain andmdtah &teas required by this Agmmmqmd in the me of tbe fhB4-ar:tm, 'sn-ikes, la^^ and ather i~&~.bid &$iwb&w% ofthe UperaWs tor sf its a- and subtmcrors') mp'luym md not pt d a wider hdwhs;d bspipuk m&dly &&ting uhor emP1oYm. [a;) nt3hb the qW Party as sqan aq reasonably gsa&mJde of the event QT ' c.e cq& a of the wteptt to *ch *man= of it5 obllgations is prevent== or thmb y; (by keep the &m Pmty fir112 informed as to the actions t&q or to be take& by it to ~vtx;otac tbe effects dmf, and, from time to time, pmvid~ it with such inf~ma-tion and pennit it such sass, & itmay motistbly mquife fh the-pnrpase ~.d$ws&sirrg anming whereby rhid AgiWneh4, that Pe#tdewlr or any of &se, ride#, int&&s trnd benedts Wn~id, but for this sub-M~1$19,1, k hdd fm t& .Mefit of+ of be ex~i~bb by pr i%r the 4met bf, qfiy ~EF mwn. (4) rt; notwithstanding paragraphs 18.1ta) and &j, any aes&mmr or bthe~ dealing is -effective by rk laws of Timw-Lesb, AustmIia or any other pIwe without that con&ent, the Designated Autbrity may tmitiate thrs Agreement (el The Designated Authority may not cement to a dtaling which would result in a yrr;an o&r than a limited liability cmtpmdtiofi, or an ebtity witb Iid liability, jr,@dfieiliy diablished k the i;rrle purp,dstS of tbis Agremenk &coming a Cmkackor, and my mnem &crw ise ia of no frrrce Qr mt. (0 For the puwses sf the foegoing, aprnbme in~Iu& my mortgage, charge, pledge, hptheca$ign, lien, w~ignment by way of swuriky, Me ~et%ntim. option, right to aequim, right af pre-emptim, right 6f &t ax cauntadaim, trust amngetncnt, everriding wyalty, net pmab ink- tw any uhr swuxily, p#tk~Ctkiid light qnity or restrietioil. any ?igWWnt in glve or to nkatedny d the fimgfljfiq and any tmnsa&@ii whith, in legal tms, is net4 s&ud go mi‘^$ but whith ham WW~G of ftnan~ihl fldt sidw tohat aft secured lwm'win& 19.2 Change in Cantual (a) Emept with the ccpmt ~f ?f Designat& Aubrity; if: there is a Cha~g~ in Qmigi of &e,Cc)~tpa&m igr, if mare tlrm axle personi any wxh ~4; wiihin fhi~, days after the Cmrtpaernr, has ,advised th Mgnat&i Authnriy in reasonabIe &$ail of tk Chmge in Cmtml, the D&gmted Authority -serves notice on the Gmtmctw that it will Wnak thi Ag~~mmt dnles sua a futi%er Cbge in Contml of the Cpasmtu~ asis specified in the ndce tab pIme fin the period Mfid in tk nati~e; mnrd the Designated Authorit41 nwy kmhate this Agmsnt. @) Pmapph 19.2Ca) doe not apply if the Chw in Control b the di~ct rcsuli of an acquhftion of shor other ~ecuritiw listed nn st recognised SW exchmge. ($1 Far the prrPposa of pmpk J9,2(a), "Chemge in Control" indudes a man masing tn be in Control (wheer W sot another person bmma in Cgngal), and a man obtaining Control [whetha or nor amther.pm was in Cmmr). Article 20 Bthef Ptovis*hs 20.1 Notices (a) Any noices required to be given by my Pam to anather Pa* shall be s~ed In wcardance with the Code. (b) All nulice to be scrvd on the Consactar shdI be addressed to irs ofice in TMr-Lest#. 20.2 AppIicable Law This Agrment shall be governed by and construed inaceordance with the law dEnglmd. 20.3 Third Party Rights Unless spificalIy provided in this Agreement, the FWiies: du wt intend that any term of chis Agreement be eufu~~tdc s&k!y by virtue of the Contracts (Rigkb~ of 77iii-d PwM} Act IN9 (UK) by any pmn wh is not a Pa* .ta this Agreement ~~~-WTT@$S WEREOF, the Parties haw exwutcd &is Agreement. The Timot-Lespe Auwridade Nmcjorial do Petr6len as Resig~~~@d Authorit$ Signed f~r and nm behalf af b amor-Leste A~ri&de~.Naeional do Petr&eo Designated Authority by its duly authorized ammiey: In i3semmzr: of: Name Signed for and on behalf of Edi JPIbA 11-106 &V* by its duly authorized attorney: In tho premm of: INPEX Offshore Timor-lesl, LTD. Signed fur and an behalf of WPEX Offshore Timar-Leste, LTD. by its duly authorized attorney: Kmji Kawm ,Ufiimr In the presence L TXMOR GAP PSC 11-1 06, Unipessoal, Limitada. Signed for and on behalf of TIMOR GAP PSC 11-106, Unipessanl, Limitada by its duly authbrked attorney: Annex A - Part 1 - JPDk 11-106 CONTRACT AREA DESCRIPTION The JPDA 1 1 - 1 06 Conphct &ea is the area bounded by the. line d&bd bel6w: a] cm-mencing ai the paint af Latitudk 1 Q0 29" QO.OOw South afld hri@htcl& 126O OQ' 36.#9?' Ewt PPajnt A,l"]; b) thence cast along that paraIle1 af latita.de t~ ifs We~:s&tiarl vicit.h meridian of longitude, 1 26" Qv 0B.UU" Ea$ ef 'Point My'>; ) theme south along that meridian of E~ngitude ta its intmmtion with tZmx: parallel of lati~dc 1 (P 3 1 " UQ. 00" SQU.@ ('Tokt A3") d] thence &st dung hat pafallel of l&itudc $0 its int:etition wiih meridim of longitude 126" 13" U0.DD7' East ("PPoint A4"3; e ~ence sou& dong that tnmdirtd b f lasnBgitude to its irntemctibn witk tfic parallel sf latitude IOU 33" 00.00" Smth ("'Paint M'"; f) thence west dmg that pardel of latitude t~ its interswtion with meridian of longitude 126" 10'' 0O.W" Ead ("Paint A@'}; g) thence south dong hi medim of longitude to its intersection with the parallel of lditude- 1 Qo 34" OO.bV1 South ("Point AT); h) thence east dong ahat pwdlej af lati& to its interseEtian with meridian of hngitude 126" 1 1" 00.00'"East ("'Paidt m"); i) tbence south along &at meridian of lmgitude tQ its intenation with the parallel af latitude 1 0' 35" 00.00"' South ("Point AT); j j hmoe east along that parallel of latitude io its intarsection with meridian of longitude 126" 15" 00.fiWEm1' ("Point A1 q; k) thence north along ht meridian of l~tudk t~ its internion with the patallel of latitude 1 Dd 30"' 00. W' South rPoint A 1 1"); 1) thence ~tst dong that parallel of latitude to its intmmticm with meridian rrf longitude 126" 24" QD.06" East ("Point AD'?; m) thence smth dmg that m~dian of I~ngitude to its intmation with tfie pamllcl of latitude 10" 32" 00.00" Souf!~ (Toin: A13"); n) thence wW along that pmllerl of latitude to its intersection with meridian of langjtude 126' 16" Q0.00" East ("Point A1$3; a) hence south along &at meridian of longitude ta its intersation with the pmalls1 of latitude 10" 33" MI.OQ" Smth C'Point AI Y); p thence east a1aw that parallel of latitude to its iutemection with meridian of longi*tude, 1 26" 19" iM3.00" East (*'Point A I B"); q) thence south dong that meridian af longitude to its interswticm with the paralIeI of latitude 1 W 34" OQ.WM South YPbint A 1 7"); r) .)ence east dong that p~dIe1 of latitude to its intersection with meridian of 1angi"tude 126" 2 1'" 0Q.W'" ('("Paint A1 8'7); sJ thence south along that msidian af longitude to its intersection with the pwllel ofkdhde 10" 35" OaQO"? S&ith (''Point A14'); t) theme west dong bt padel of latitude to its idmtion with meridian of langitude 12@ 1 $' W.€?WTast (‘Taint A2B"); u) tlreqce sou& dag that maidh~ of longitud~to its intemction $vith the pIki bf latitudk 10' 48" 00.00" South Clainj M1"); &mce west abng that padIb1 of latitude it@ its in'terse~tion with nxddiaq of hngit~rke 126" r i* e)r0.00~=t ("~~kt ~22'3; w) thm~~ north dong &at meridian of lengiWeko its inkae&iara with the pardel 6fIatitude 1 Oo 36'' 5 8.424"' %u& ("Point M"); x @hwe west dceng &at palallel of latitude to its iatmwm with rneiifim of longizLlde7 l2P 09" 00.OD" Ea5% ("Point A24"J; y thewe wyth Jmg that meridian af tangitude ta its intersmii~n. wi& the p@dld oflatitude 10" 38'? 00.6.0" Smlh C'Poi~t A27 '1; z) &we w& dmg that parallel ef latitude, to its htwedon with meridian of lsngimde 1 2GQ M" 06.44'Wt ("Point: M@%: aa) &$n~e northwest along the geodesic to the pain1 af w~e~ment C'Point AI"J, d the line described as tsollow~ a] a)weafthepaintafbitude IUwM'OD.OQ"" South.andLwgitudelZ6" 07' 19.74'%~ast YFoint Bl'"; b) then= am slang that pardel of Jati'tude'tu ib intersection with mddia of bngbde 126" 09" 818.00'' East YPsint B2'3; c) .theace sonth aImg that ddim of longitude b its interseetian with the parallel offatitud~ 10" 4 1" 0O0,00" South C'Poiat BPI 4 thence wst dong that parad d latitude b its iritersectiori wia meridian of lohgitud'i 12G0 15* 0O.W East ("Point B4"); 81 mfi along that rn- aflongitude tm ib- &-on wi€hThe parallel af lathde 10" 3 8"- 00.W3%th mint BP'?; 9 thence cast do~g that padl d oflatitude ta its intersection with rne4disl.n a f lon&tde 126' 2 Yr 0O.W' Eakt rcF&t B6"); g thence: south dong that meri.dim oflon~tdetu its interndon with &e parallel of latiW 1 P 46'"M..QOw 'mi& lJT%-kIIt BT'); thenc~. wast dong that parallel of latitude b its intersection writbmeridim of l~ngitu4e 126" 16" 06-08" ("P@inS B8":); i J hce south dmg that meridim &lon@de to its in-tmtiran with thepadtI of latitude 1 QQ 42" DO-WK&uth rT& BY); j') thenc&&stdmg ht p&dld ~f latittmEf$ t6 its int&s&c't.im-with rnetidi& df longitude 12gP 1)(9+0^,W3 Eqst (Taint w I@'& k thenee nwth dong &at lireridian mf lmgimde b its Inters&Zion with %he parad d latitude 1 Ob 4 1'' QOaP Spt& ("Pa B 1 1'9; I3 hence atst along that.p&dl&I af l&ude%^&s hterkction with &&&an of Imgittlde I W 22% Qb.Q@? &st YIJqint B 12'2; "m) th&w mu& dorfgg that meridian of lan@trrda fb its intefwtion with &b.pdld af latitub lao 4-4' W.OW So@h rhint ~13'2; thence west dofig that pa~dld ~£l&tu$e mfts intersection with ~eridian sf lpngitude 126' 1 9" QO.OW' East (%ifit: B 14'x n). &tinee muth dm that meridian of Iongimde to iits intersection wi-tB bVpardlej. of latitude 18' 45" QO*OW South. ["Point B 15"); p j theme wgt along that parrlUe1 elf latitude to its intersection with meridian of Imgitude 126O 1 a' i10.0V7 East (''Point I3 16"]; q) thence soah dong fhaf meridian a f longitude to its iqtersectian with the pakdld of latitude EUo 47"' 80.QO')" 30th C'Fbim BIT?); r) thence east dogg tht pwdld of latitude to its intersection with m=.idim of I~Z@U& 12P ~~"Qo~W? ~83t ('%ink Bi8"); a) thence nu& aImg that meridian of Eongjhde tw its intm+secti~1>~th-xlie parallel of lahde 1 6e 4g2 QOXlQ?' Swth PPoint $1 Y7; t] 'thence emt dong that parallel of liatitude PO its irrterSectisa wih rrr&&imaf Isagi~de 12$* 24"~ 00.0~' Dst$'Point B20b}; tr) 'thqm muth &11g that meridian of liongitude to its he~edti~~~ with tbepaall&l .af latitude 1 Qp 4F OB,Or 3pt& YBoiPlt Wl"); v) -thence 1st along &a% pdld hf Iatituil~ 'to ik interndon with &&i-idim jsf hpgiW,e 126" 'W QOhO" East rpoint B22'); WJ &mcc s'puth ilehg We ind&m of lo@&& to its Wmtiwr with &a.ptdId of Iatitud6 1P 4" U6.00" Smtb YPwint B23"'); x) &enc,a wesf dong that parallel of latitude t~ its intewction 1~1th nzei-idimsf 1,sgmde 126"- I 8" OO.OO1' Ewt (Taint B24"); y] thmw sath along that merkk ickf lopgitude ta its intwswtion with h pd1d of latitude SF 3W' 08.80" South (Taint B2S9'], z thewe west dong that pwdd of S;ttitud~ tg its hterwtion vith mdim af longitude l2P 1 5'" 26.49'" EaS (Taint B26*]; aa) tbmq: nmhw~ alwg the &wit; to the pint of latitude ID' 49'' oQ+Op'' %uth (Toitlr B27"3; bb) theme east aIorrg Sat pamUel of latitude to its kters&iari with m%ri&an af IQD~MZ UP I 5" m.ouw mqt CTO~~ ~28'3; CC] thence north dong thatmeridian oflmgitude to its interswtion with tEre pardel af latitude IOo 46" ~0.(S07' South cTPo.int BB'3; a) theklce wat dong that prallal dflatitu-de to its &mmtion W& mmidian of -We l26@ 10'' 554.79" East ('Taint 830'3; eel hence northwest dong the geodes:@ -ta the paint a£ camm,~~mt; (@Taint B-I"') "rhe appwximte area of JPDA 1 1-166 is 662 sqme lulometpes Note: the origin p f geographical comdbatw used in the meet description ia fie Australian We!: Datum 1966 (AGD66). Amex A- Part 2 - JPDA 11-106 CONTRACT AREA DESCRTPTTON Itl acwrrlmce with Section 3 of the Feeoleurn Mining Cde, po~itiiow in the JBDA may be qx~ressed by rdir~nce lo. the spheroid W~1:ld Geiod&c System B4 (WGS84), which has its mnm at ate mn'tre of the Earth -and a major [equatoriaQ radius ~f 63 7'8 13 7' mew- md 8 flattening o'f llrO/29825.7223563. The pint ~~GFS in the following .t;rbleof WGSB4cc&~bat~ emespond to &e writfen de&&tion of he Cmfraci Area as described in Annex A - Pa& 1. In the went of & dis~qqp~p between the Amex A - Part 1 description ,an& the WGS84 coprdinates tabulated bdaw, the hex A- Part I description tab pecedema. Annex B - M4P OF CONTRACT -A Annex C -ACCOUNTING PROCEDURE Clause 1 General Provisions 1.1 Purpose and Definitions The purpose of this Annex O is to Mer define the manner in which the &s and expenses uf Petroleum Operations will be recardd, Rmaverable Costs will be determined, and the Cantsactor's bmb and acmutlrs will be prepared and maintdrd, and acillary matters, A tb a Clause ar pagraph is fa a dwse or $amgraph of this Amwx C unless the ~bntmq is stated. A refemcee to an Mide is ta an attide of the Agreement to which rhis Annex C is attached, The Conkactor ahdl maintain complete accounts, books and reads, 0s an accruals his, of dl costs, expens& and revenues of, or relating to, Petroleum Operations, and the sale or ather dimsition of Petroleum, on an accurate basis and in accordance with generally accepted accounting prbmhm and standards af the internatid petroleum industiy and in accordan~e with the charts of aaoulfta mentioned in paragraph 1.2@& Within sixw (60) days after the ERkctive Date, the Conkaa6r shall submit to the &sign& Authorig, fpr its approvaI, an outline-af charts ofacmunts, book, records and repom to b used for the purposes of paragraph 1.2[a} and far rqwrting to the Desmated Authority ttrerem 1.3 Language and Units af Account Metric units and kels shaIl be emplayed for meztsurements and quantities uadm this Agreement. The Accounting &cords, and all reports to the Designated Authority, will be in English. Ttre Accounting Rr.cods, and all reports fo the Designated Authority, win be in United States Dollars. Costs and revenues in mather currency will be translated at the exchange rake set on the day the cast is imurrerl or the revenue rdised at a time and by a financial institution designated by the Contractor and appcavd by the Desi@akd Authority. Exchange gains or lasses wilI be credited or charged to the Acwunting Records- Clause 2 Classification and Allocation 2.1 Exploration Costs ExpIomtion Costs are those eosts, whether of a capital or ope* nature, which directly relate to FZpIoration and are incurred in respect of activities carried out substmthlly in accordance with an approved Expforation Wwk Pragmmme and Bud& but without pxjudice to s&&idc 4.5 of this Agreement, including costs of: dfilling wells [and related abandomht andl site remediation thwm9; &) mi%@, im1Udirrg labo11r- rnW'dYi mtf seWj C& ((inducting desk and adpk af survey data) tqed in aerial, g@l&&I, gedehei~eal, gdophpLrtl and WIS~C $urd!ep, end ere. hule drilling $dl wrsrkshop~, power aed water f&l~es3 wmebusI site DIXWS, acwq a,nd csmrnuRicati.~n h~iIi&s; e floating maft, automotive equipment, furniture and o6r;e eqnipmmg and Capital Casts [a] in retspeut af a Develapment Arb, ad bdm he shrt of'Comm-uial Prodtaction hm i4 those mafs, wbethb of a c@M sf qem~ng na-, which dimtly relate the Dwelapmt ofit; and and are in- in rtspmt of hvitia carried out m gain wherever arir;ins em%pt with fie cgmt of the Designated Auth~rity, casts hcd in respect of Petrolem ahr it has the FieEd Export Point; D~amn~is~hing cot;& actual1 y iricW which have been taken into ,arcaunt far the pu~pases of deenniniag the Dewmis~ioning Costs &$we; audit fm &,aecaun% kee (excluding fern qensks incud for ,the conbmt of atdit and amounting =ices **red by this Apemmtj, ikutrr.d p&darrt ad th'c ~GdIifixig md wounting rquiE&ndp$ nf my Eaw arid a11 GQ& spkssa incurred 'in cbmtim 6th inmgwp wqmr&e repmhg reqdmmena Qwib&a ar nW @+pired by law]; [u) with the CDWB~'~~ tk Dmign&d AWty ai~d in m%da@e wit31 the,cpbdiW dlhg consmi, my kpenditue in mp@t bf &C hiring or hasing of sttucew%s3 'fwilitiw, i~sttlll&ns; w~ip+af +r other wkf @her ~.wh; tv) dmep! with th m&$ent of the &$mated ~uthariiy~ w, indadin$ dmatjons, @&ng to publ$c rdatims w ~.~phmm~f ?f th~ Cqnmws's mmte image &'&tewas: [XI CU& assabiated with lwaI ofkces and ld ddhation, indudiqg staff benefits, which are excessive: h) @tqt with the commit af the 3[;tdgmkd Au&mi~> but shbjmf to sub-McIa 4.4 of Agreement, mcts out iadudd in a Budget far the ~ievast Yew; and @ ~~$tsaqt falling whhh any of tbe above items wU& a@ sated d~&eye in thh -went FS b be: recwembk (bcluding h paragraph 3.1 (dl of Mcle 21, m &st$ .ingmed Without the ~mwpt or appd ofrho Designakci Authon-ty (where such k qW. &) Dwtathn is ant RccmmhJe,f&st, [GI The mad for the dIccation of wed and administriation w+, o#w than direct charges, allamble tQ Petrgleum @eratian5 propwed by tbe Contmtor shall be subject to approval by the Designated Authorily, and shall be q~ed. %a& Calm* Year cantistmdy. [d) Irlventmy Icgd3 shall be: in mmrdwte with Good Oil Edd Ffad~e. The udue of invantory ikme not u%cd id Pwbim C3pehlibns, or @id, tbrs md of whi& hs bm mvcre E@ an Qpcwt@ Cmt, shall be-td as Mdanmm &cairnB The &st of an itm pmcbaed for inventory shall be a Reewmble Cost- ( Where the cost of anything, or a m&pt "tt v&e) in wspmt of mything, mI&m ody dally h the &ng out of PefmIemt Ope&onq dy that portion of the cost or be receipt [or value) which relates to the cmyhg out of Petroleum i3;peratim will be a kwwemblc %st OF a~ed as a Wscelheous Receipt. Where any casi rrr re1ak-d receipt (or value) relates a nmre than ane nf ExpIoracion, Appraid, C~itaI ma Operating Costs, or to mm dm me Bve1opme& Arm, the cost BT AateB Weipt: (hr value) will Ik Appsrti~ned in an quibble &mi&. Sub~ect as otherwise provided in this Agreement, the following costs, charges and credits shall be included in the determination of kewverable Costs: 3.1 Surface Rights All direct costs necessary for the aequisiih, rmewal or relinquishment of swfaoz righrs atquid and maintained in hm for the purposes of the Agreement Labour and Associated Labour Costs (a) The Cnntmctorts Irrcally mmiitd emplqefrs SPA in Tirnnr-Tx<& nr Australia: hsts of BI locally rccruitd employees who are directIy engaged in the conduct of Poleurn Operalions in the JPITA, Tim&-Leste or Australia. Such costs &dl include the casts of mplo yee benefits and state bmtrfits fos employees and levis impmed on the Conimctm as an employer, transportation md relocation costs within Timur-Lkste and Auskdia of the employ& and such memben of rfie employee's family (limited t6 spouse and dependent children) as required by law or cmimmary practice therein. If such amploytcs are dm engaged in ather activities, the mst of such employees shall be apportioned an a time shc& basis according to swrrd and acceptable accounting prmciptes, Assign& Permel: Costs of sdarim and wages induding bonuses of the Contractois employees directly and necessariIy mgagrd inthe mnduct of the Petrbleum Opemtions, whether temporarily Dr permanmtly assigned, irrespective of the Iocatim of such mplnyeq, it being understood that in the case of &nse personpel only a po@ion of whose time is whdly dedicated to Pbleum Operatiam under the Agreement, ody that pra-rats partion of appli~abk salaries, wages, md ather costs as delineated in pmgmphs 3.2[c), 3.2(d), 3 ye], 3.2(9 and 32Cg;l shall be charged and the hls of su~h pro-rata dmatiw shall be specified. The ContractoP's casts regarding holiday, vacation, sickness and disahilrty benefits and living and h~using and other wstmary allowances applicable to the salaries and wages chargeable under paragraph 3.2Cb). Exgmses or contributions made pursuant to asxsntaents arobIigafianu imposed under the laws of Thor-Le& ar Aumlia which :he applid1e. to the Catmct~r's mst of sdaries and wages chargeable rn-dm paragraph 3.2@), Thc Contractor's cast of established plam for empIoyees' group life insurance, h~pitalirdtion, pnsion, stock purch~es, savingss bonus and o&er benefit plans of a like nature customarily granted to the Contractoh employets, provided however &at such cmi% rn in acwrdmce with genesally xqted standards in tke htmatind petroleum indushy, aappiicable to sdariiries and wages chargeable to P-leum Operations wder pmgmph JS@}- basanable Wansptktation ad mQel expense d employees of the C~nrntar, induding thw made f%r travel md relocation of the expatriate empIbyw5:, including their families and personal effets, assign4 to Timar-12este or Auskalia dose $881$Ties and wages arc nhargeuhle to Petmleum Qperatiom under pmmph 3.2b). Act4 transportation experts= af expatriate personnel Mwtd to Petroleum CSpmtions hm their country of origin shall be charged to the Petrol- Operdtions. Transpartation expenses of personnel ?mnsf~d from PelmIeum Operations to a country other than the cuuntry of tbeir origin shall not be charged to the Phlm Operations. Transpottation cost as used in €his s&on shdl mean the cast of freight and passenger service, meals, hotels, insurance and ather expenditures 09atd to va~atian md &an&er travel and aub~o~~ under the Contrwmfs :'stamkd ptiwmeI plidw4 The C~m~er shall &@ all mpqdihm dat& t~ mnspamtim MS are witably allws#d a the a~vitiq wfrich bv~.he6tk:fi &m the pwemd evn$eqwL [:3 Reawable pemd apmm of p~~e1 w- &e$ wd wagpqe &agwibIe tQ Petroleum dperrttiuns under paragraph 33b) and fbr which wpm= such pmnntI skrnbd under tlm Chimttor's std pcmnnd pdici&+ In thm~mt~such axpe&m are rmt wholIy~ihCirble tu P&m'te~m C3p?rnlimw &a P&tmI&rn Bpm&ms sMl be cha&ed wifh dy the kpp1ikZtbk~pakti6h thered, wbrkh Wl be ddetwked an in k&yi&k Mi%. 3 ~ramp~fiafbn and Empiawe Fkfob%@n Casts fie .mpf irampn I$ m~iayees~ avimt, met&& md wppUwqbber thm as prsW in 3.2 pewqq-fvr @e qoadue$ of the Piemhzm Qp-rn d~ng wi& $r$k Matd cm& indudpg Mpoe chttim, cwtwns feesT u~lod~c~~qc~ dock fcaq and +d aud oeeaq f&&~ &err- Fgr pwpmm ~f Qfb.C1a~s2 3.4~,~iazes whit& are= whdbme4 by the C&ttaWro~the GmwWs &mat@ biding campmy &dl be cbsidered tbird parti@- Tbc -1 wts af wtract -SMGRF viq Gf pqfesqiwd mwfltwb, utiliria, and other wmkes naeswy fos he w~duct of the FWulm Qdow pdmd bcthird ptiw &cr than an -1iate of th Cbntmcbr. (ii Pmfdhd d AdminiqItiV3 SmVims Bgerlm< cm pfwi9mJ '$nd dmiddve &wpcivi&d by my AEdiates .of &e Conmaor fm the direct bm& crf P&&m Operatiow, iadudiug sdw provided by %he protiuvW m@wl$on, IegaI, fiamcial, bsumm, awouating-and qua- mmim diwisians other than the mvd by sub-pmgmph 3,4@)fi4 or Clause 3.6 or pampph 3;glb) which tfie Cantractor may us% in Urn sf hahg its awn employees. Charges &A1 T~W dte cost of providing tldr smites md SW nn% indude mty dm& of pr650 md be no las Bmumble fhan &miIar fir ,dW opzmG1~18 Wd rn by tk Cmtmbr and im &%Gat&. Tkev&&nutmk shall inc1~idpall J1 incidental ta themphpneet dbakh peqnnd. Whm the work 5 @omd bud&$ the hme &wbsa &fa& pemmme1, Eht daily mw sbd b ckgd Born &e date mch pepamel the M~E offim ba&e where they wwny work up m tlieir mbm thm, incl- dap which are not world@ days ih t& Iocatiafi whm tht ~ is pedbnh4 ~1udkg~aey Miday eslfitmtna diivkd-w su& permme1 bin he? mplopenf ai it hm office h&e, EquipneM and facihties: use ,of equipment and .%lit@ owned md ~*M 4y the ~m~ctor's~M5Iiafa, at mbs c~amenpmk with the qt sf wm@i,, md aman; pmided, bmew, that meh Ad nai Ehbm t%mmtfy pm&g fb~ the mppiy Q? like q'uipmmt and fadties an campable tms in the NU ?;;he P&&htn -tioh Atb beiq cL&aM. he‘ kquifirn~t. and !%titim mfhW io herein ~xc1wi.t: m$~r ipestment- item$ hich kzq [bat not limit4 to] dridcilling ii ga, pradrtqins yltt+m. ail mating Wti@esv> oil ,wd g@ Emdiag,and mqpomticsr! gystgms, mmge and tamid fkilities and urhm major fereiIjges, ram "c$ which shall be subject w separate agrmment wixh fhe Designated ,Authority. ,66sts uf acquiring, leasing is@1lhg, apela&ig, rqdiring and mainf*ug ~aro~aunicdtion systems ir%clMng mdia mil micmwavt: fa~ilititierbmwn the Cantact && and the CkaiW~~ds We 3-6 Office, Sturage and Mkwllmeous Facilities Net cosf t6 Qe Conmtm ~fPstablj,hing, mninmg md mmating gy a%m, $ub+KmP wafehu5~ data &sage, iroudn~ or other ficility in ~imar-~&idy mng the Pettaleurn C$mtiam: a Custs hd In the C~ntfSld Area as i of kgkLtim frx mhaeOI~gica1 and geophpid surveys reta.tingmd&6m&m andpratection afcuJmd dtes or~urca. Cd) Costs of actual mnhl and elemup of oil qil?s,> and of such Avther responsibilities remlting thwfroal as may be rkquired byalplie'ilbe 1-s kind regWri:wns. Casts of matmi& mil supplies, equipment, machines, tmI$ md my other gmds af a ~imnilar natm used c~armmed in B&-deum Opdfl~ subject to the foIlewGug. (a) Acquisitbn - the Contractor &an only wpply or pdse mat&ds far use in fr&oleum Opemths Wtt may be be iin i&e.,f~mswabb ktm, The atmuuda%n of surplw.st& and iavmtmy $hall be qoiM so Pat as b reasonably pm&ti&l d m&tent with effi-imt ewm@d ma&w, ftw- I&s &dl1 B~mef, @& int6 m~ount the 1% 'fm nqhmt; emergemy I- weer ~dtims w6xting qa-ations and gimilgr wm$~dmfi~w. 1 Compomr& @ casts, mla Iesgth tcansactim - except tq &elwiw, pmvided in pangraph ?LB(dl, mahid pchwd hy the %-tor in ds lwth ma~tiaa? in ilie open market fa use in the Petro1mm Opecdhs $Id1 be valued ta include invoice price Iess lmde and cash &scoiin&, tmd pmmmrnmt Y&s plus &i@t and forw&ing charges beheen pint d ~dlaply and poiit af lap&pBlkt; %eight to pmt of destination, iwmce, taq, .@u- dtitiaq coasuhr f&, exdl taxesI ather i- ~~e a@Wt imp&& rrferreiids and, WW appEkab1C hm&g anll tmqart&on expmrn froin wint ~f impartation to warehme 6r 9pma i= mrn an Af5liate of the Cmmmr iw mmgqd th~ purchase, codhated the fgmIEFding and expediting ego$ a & qud tI ffaur (4) pex crnt~f %e wlu~.@fthe;. rn~Pqriab may be added to dq cast of the materials pumhspi. Accounting - mch material wsts skoali be *rpd ia xhe Awomting Records: wd baks in acmrztnc~ with the "First in, First out'' (FIFO) wetbod. (dl Mafe&il purehard brn QT sold to Affiliates af t!i+e Coat~~r or #ransfad hm otheradvitia of the Eontrad~r ta or from Fekoleum aperations shall be valued and &argd or c~ditd at the p'imxpgifi eel in mh-pa~qqhq 3.R(6)?Ci), 3 .R(d)(ijj and 3 RQcl)fiTi). (ij New ~~~al, indudhg used new rrrmaWaJ nioved hm inwhy fC&diti& "A"), &all be ::&d at theAimmn't intmxttiati;il net @iii:t.whicKsbdll n;at pfitt,.p~~$llin$g in mmal am's length mns$etims in tb sp% mat&, Materids w?ich mot be classified as Cmdikiaii "B" but which am reconditiming will Ix hither swimable Ear i& &&d fk&onMl be clas$fied as bdid 'TC" and plticM at not mm thm fifty per ~mt @OX) of tbe wrrmi pfke ~f nep materid H dekted iq Sub-pmgapk 3+8@)f)qi). Tb MSI of ~ditibning,skal~ h @argd tg the mmnditioned xlr&e$aI provided that the value of Cditim "C1' mterid plus the cast lo;f~~fId;~~~Ilg does not exceed the mlue of Condition 'BP" rnhrid. M&d which ~bnnot be classified 9s Condition "Bw or Cmditim "Cu sM1 be dded .as Cmdition "23" and pri& at a value rmme3lbumk with is we by khe ContPaemr. Ematerid is not fit fsr use by the Contractor it $MI be disposed of asjunk. (3) MEtterid hv01vi~g erectinn wosB shll he:chrged at &e applidle amaitim peremage of the wmnt ho~kddown price of nmmakrid as dehd in sub-pamgmph 3.8(4{iJ {iv) Wbn the urn of material is tempo- and its Psce to the Pmlmrn -tiom sat j&fy %e rdtltdim in price as protrid%d far h sub-paraga# 3,8[dj(ii_&b), such material Shall k priced on a Ws that W red in tl net chatga to the swmmts under dds Agreement cpnsidmt with the vrrIue of tbs smvi~~e m&d. Cv) Premium prim - whed~vdrrn~erid i$ mt dly obtainable at pubwed or listed pri~es becamd af dolral em erg en^&, shks ar e&er rnw~al~ causes owr which the Cbntracbr has no ~fintmI, the Contractor my ehage PWeunr Operatiam for the requited materid at the Cbntrmior'~ &tud cost hcd in prmid'mg st& matmial, in m&g it miable far he, in mvhg it m the Cankt keq provided, notha in Mting b~~kd eo- k Ibim A&ri!y dfthe prbwsed ~W&pri@r to takargitag P&tmlcm UpeM~ns Pw su& rn- aid. ebe Mwed hthcn-iy shall the right & cMf mge the %amd~'tl at audit. (0 Wmty af mat- by Can- - the Cuatmtu~ dot!$ not wanant &a materid Wgh&d. la Me of def'due. matedblx &redit shall nqt be passed tn Bmhm beraiimq until adjwmmt iks bwi receiv@ by the Cbmemr ha the ~uf~ums of the mataid or meir ap4. 3-9 RehtAls, Ddes and Other Ass&sments A11 mhB7 levim, clm$es+ fiw, wo1libutir~mtls:and ~&r barges af every kind and ware levied by any '~imor-Leste m Austdim guvemmental auhriv in coanmtion with the Retrokurn Operations md paid dh-ettIp by fht'Contractor (save whre the contray is cxpms1y provided in this Agreement). J* 10 I nsurame and Loss- Wumcq premiums & casks incurred for iusurance pmuidad that such in~mce is ea@mary, ,aff6r& pdmt pt~tion Wim risk md is'at a premium a9 higher xlrm thxt ehgd an a compekitive bais by insm~e ~ompm'es which m, not Asliaw oft& C~ntmctw. bcept in af failare ta inwe whex insmca coverage is required pmvant Q this &reern& amhl casts ad laws mpqr@l5M be allnwabI~ to the extent not m& g~qd by imurarm, Such ms~ qw include repair md replacement ~f propem rmuhing hm damages or hams inald hy fire; flvdl stom, the4 accident or othw cause. 1 Legal Expenses All -able mm and eftpens mltmg fmm &pi hdlbg, inWgiing, asserhg, defdirpg or settling @f aay claim or I@ actidn newisq or expedjmt for the procuring p&t;ng, *don and prokctian nf #e Canbt ad in defendibg as pmsathg lawsuits infr~lvhg h. Cantract Area m my third party claim wising out: a£ the Fmlevrn Dpmtiw. ,or ar pipaid in wpm of legal .smites nec~sary for he. protection of tbe joint in- aP the Desipkd Autawity md the. CclntrWor shall he dbwablo. Smb expend& shaU bhde, attmeyta few, court m, costs of iavwtkati~n, and prectlmwnt of midewe md mounts paid in sealemmt or &tisfa&qn of my such litigation apd daims. Whm legal smicew az mcId io suoh aatters By saW or regularly retained lawyers of the QR~XU~~ CW U &%fi& ~f *e mgtpwr, SU& &lgl~~&Qjl .ShdI k. hdlala&d hHbd 1s,ndg 9.4(b) w applbable. ExWdi- made in the seetlemiint m atishetion of any loss; elaim, dmae judgment or other expi=nm dng out 4fw r$i&hg,m ~etrple~~~as. 3.13 Training Costs All wts ad expenses inm by the Conbiwo~ ia the t&ning ~f its mplwees engqgql ,ia Petrdeum CIp-atiow ad wch ohm baking as is reguirtsd by this Agreement. Mk ms-e qpe-8 n?t ecrvemd or d@t with in @e foegoing pmvi&;ps dths Z=1m?e 4 wh$& are n-wriIy h~umd by the Cmcta~ for the groper, r,and@ and eiqienf d Pemhm Operatiom. Clause 4 Inventories ~nwbrieS af pmpm in use in Pk'troleum Opedons &dl Wtakea at 1~asonab1e in~malS but at IezW once a year with respect to movable %sets and OR& wexy thee [TI pWwiTb respect tb irnrnowbbk assek The CmCBratrrictor shall give the QaigIaft A'uWiy at least thirty (30) days w&m not& df it$ inka&Qn ta take SMG$ izfvwtw md fie Dmigmkd 4umdty shdl bpvc tlr~ T&&I to tae mpwmted whm such inventwy b, take~. The cqab3@ shall deady state grirrciple spa? which valuaaiom afthe itLvmtixy has bm based The Contractclr &a11 make every to pm;ide k~ the DeGgnated Au&& a full ~pft on such inventmy within thirty (308 days o* the taking d the invmtq. When an assignmen't of rights under this Xpemen~ takes place,< the &nim&r may, at the quest of the ~sigpze, &e B qeel'aI inventmy pravided that the costs of such inventq m BO~IEC by t#e asignea tho qdty of tide ail p*oed d save& the qdty clqrwtar&ics of such Crude Oil pmhccd and saved, the quaatides of Crude Oil agd kwd Gaq wed for the pupuses of wrying on drilling and prodmtibn qmtian~ and pwphgtc field the gumti& p f Oil and NaW Gas mmily lm$ the qumiities ofNaW bd and vent&; the size ofPemh sta&s heId at the beginning of .the month in question; the size of Pefro1eam &&ks held at the end df the month in quaion; ik qwa&ties of Hmral Gas ~iiajefld, into thehem* and AIl gumtities shown in tbis~taternent shall be ex@sd hi b& v01d~ &rim @mll~ of Cmde Oil and euhiq metezx of Wattid Gas] and in weight [rnebi~ tonne$. 5.2 Suh~iisslwn 6f Production S2atesement T~E Pradwtiqn Statement f~r & munth sI be submitted tn &E Desfgnakd htbgrityna lWr tbm ten 0) clap after the d nfuch month. Value gf Production and Pricing Statement Value of Production end Pricing Statement Information The Contractor shall, for tlre purpom ~f Article 8 af the Agreement, prepare a. VaIul: of Pstrductiqn and Pricing Stabmt providing calculatioas af the value of Cmde Oil and NahyaI Gas pmduce8md saved during each Qwer. This Value of PrduEtion and Pricing Sfategent shall mntain the fo1Iowing irrfbnnation: the quatitics and the @ce payable therefor by the Gon&~ctor in mpect ~f sales of Natural Crn and Crude Oil delivered ta third parties during the Qu- in question; and the quantities and price payable in respect of sales of Natud Gas and Cmde &I ddivered during the 'Qurtrrr in qrmem"m, attier than to third parties. Su bmkshrr of Value af Production and Pricing Statement The Value of Production and ,Pricing Statement for each Quarter shall IM submitted to the Designated Authority not later than twenty om (21) days ahr fbc end of such Quarter. Clause 7 Cost Recovery Statern ent The Canmotof shall pr@m with respa to- each Quarter a Gost Rmvery 5takmem oontaining the falidwing idomatiw: Rewyerable Costs for the Quarter in questition; CR&$ under the Apmmt for the Qumer inquestioq Id) Toial b~vx~erable Costs for the Quarter in que&on (pagmphs 7.1fa'J plus 7. I @) IWS 7.1 (~1; qmlity ad vdue aE the Conkactcds share of Fekoleum under hde 7 of the Ag~eement in the Quartet' in quWio~; ,and Preparation and Submission of Cost Reeovev Statements An AhslaaI Cast Bemve~y Shkmmt &all be submittd within ninety (9D) daysS afkr he ead oE>ach The Amilal Statement shall contain the caregorim of inf~rmtftidn list& in Clause 7.1 for the Yew ih cpe@on, sepmtd hw the Qmkrs pf the Year ia q~ernn, md shawing the mmuhtjvtt~8sidw~ .at he en& bf&e Ygr in quedan. Clause 8 Statements af Expenditure and Receipt The >CqnUitctW $Mi1 prepare with egwt tp each C)w a 5tateq&t >bf Expeti&mre apd &iyip&,. The $tWmtmt will disingukh hwtw Explmn, ApprWt &pi@il and Qpet&ag Costs add wd idqnti& ma@ ikm~i: witkin ibme c&e&es. I$= 'Swment wjH sbgw *e Pollqiarg: , cumulative expen& and mipb hr ~e %ar in questhP; [c) !&at f~reeztst cumulative expendimres At the Year end; (d) ~~atiorrs between budget Wt md Iatmt f8mt md mplmtim$hwmf Thk Statebet ~FE"p~hB3fure ad Receip~ of each shall 'be .sh&tdLto &e Designaid AutMmity na htwthanfiftem &~.aftet- thead izfmdi Qter. 82 Annual Statement The Conhetur shall prqm a FLnaI End-offyear Shtcmmt. The Statement wi1I contain infamation as provided in the Production Staternen$ Value of Pro&c&n and hieiug StEtkmenGr Cust Ikmver)r &ment and Shterrrmt of Egmditwr. and Rdpq, but Urin be based an acbd qumfitis sf P'kbmleurn pmdu~ed and #s& imutfed. ll& SWernenf will bo u& tit! make atiy adjlrstment& Wt are mceaaq h the payments mado by the Onhmtar Imdr;f.thi~mis Agnzemmt The Final E~&~ET&F' Sfatmeat of each Calmdm Yeat shall k'subplittcd to &e.D.eSigmdd Autkoriy within nit@y (90) day$ of th~ end OF& CaIeadg Year. Annex-PI - PROPOSALS FOR TIMOR-LEST33 LQEBL CONTENT IEe faIl o wing p~pposal complies with subsctim 5.4 pf the Cndegoods and sewic~:From parsons bad in 'i'imr-L&e. 1. For CoJltfa Ws subcmtractb (acepVcmtl.act9 taken on assigma from,&er ap~ratm)~ ensure l atal contht pravisioma~ itrclWin snchsub-~n&c& d in particular for thedrilling rig, rig s~ba, hpply, logi&cs md th~ gemburn irifraspucme pjwt I&+ to in im 3 belpw; 2, Frovide the resaw& to mtivdy mure that ~~ub-cbnlmctors~m in cvmpBmw with their lmal eentent pra~isi~ns; and 3. Centriblrte ta tbt eshbligh~e'dt of p&-o$eum in-s- in Timor4,wtein fhe fwm .ofthe D~IE~ T- aad Core Sumge faciIily.at Hem eappcd at USS1-9 whch will heminaged thrnugh &e esiablishd processes belween the Cantraetor and the Resignaled An820&$ 4. Provide six months of Dili-bqd tmining in wli, TT, HSE ad Rdmleum Gmscimce and Engineering to ter% (1 0) quaifid Timprem>@atcs, smsndme~ twfifive qualihd Tiinomsrn graduates the Explomti w Period and additional secondmmfs to five (5) qualified Thome jyadutts h the went lhat ant or m~fe cantiagent wells is drilled. Imphmentation crfh miaing and ~c&ent is sukjwt to phr appud OF the D&ignWd AnthafieY- My Coats and qmdim incurred in impl-g tb piaposd~ s& out in this A~ex B rn costs being inmd in carryirrg an Petroleum Opaatiom md a% deemed tu be &cavemble Cost8 for the purpma of M&e 8 offhis Agreement