Environmental impact assessment and management plan
Within 3 months of the effective date, Minza Oil & Gas Limited shall submit to the Timor Sea Designated Authority, for its approval, plans in regard to:
- the health, safety and welfare of persons in or affected by petroleum operations; and
- the protection of the environment (including the marine environment and the atmosphere and the prevention of pollution), in order to reduce the risks to the personnel and the environment so they are as low as reasonably practicable. The plans shall be reviewed annually and amended from time to time as may be necessary to ensure its continuing compliance with good oil field practice.
Minza Oil & Gas Limited shall carry out petroleum operations to:
- protect the environment, ensure that Petroleum Operations result in minimum ecological damage or destruction, and clean up pollution;
- ensure the safety, health and welfare of persons in or about the petroleum operations;
on the earlier of either termination of the agreement or when no longer required for petroleum operations: abandon, decommission, transfer, remove and/or dispose of all structures,facilities, installations, equipment and other property, clean up the contract area and make it good and safe, and protect the environment;
- control the flow and prevent the waste or escape of petroleum, water or any product used in or derived by processing petroleum;
- prevent the escape of any mixture of water or drilling fluid with petroleum or any other matter;
- prevent damage to petroleum-bearing strata in or outside the contract area;
- prevent water or any other matter entering any Reservoir through wells in the contract area, except when required by, and in accordance with, the development plan and good oil field practice;
- minimize interference with navigation and fishing; and
- remedy in a timely fashion any damage caused to the environment.
Minza Oil & Gas Limited shall clean up pollution resulting from petroleum operations to the satisfaction of the Timor Sea Designated Authority, and meet the costs of so doing to the extent done by anyone else (including the Timor Sea Designated Authority).
Except with the consent of the Timor Sea Designated Authority or in an emergency, Minza Oil & Gas Limited shall not flare petroleum.
The Timor Sea Designated Authority may require, at Minza Oil & Gas Limited's cost, an independent audit
(starting, except in the case of manifest error or fraud, within 24 months after the end of the calendar year, and concluding within 12 months of this start) of Minza Oil & Gas Limited's books and accounts relating to this agreement for any calendar year. Minza Oil & Gas Limited shall forward a copy of the independent auditor's report to the Timor Sea Designated Authority within 60 days following the completion of the audit. There shall be a period of at least 12 months between independent audits except in the case of manifest error or fraud.
The Timor Sea Designated Authority may inspect and audit (by itself or as it directs), and at its own cost, Minza Oil & Gas Limited's books and accounts relating to this agreement for any calendar year (starting within 24 months after the end of the calendar year, and concluding within 12 months of this start).
Minza Oil & Gas Limited shall fully and expeditiously assist and cooperate with audits.
Production Share - "Profit Oil features (triggers for variations in split - IRR, factor, production, etc .)
Any petroleum not taken for royalty or as recoverable cost oil shall be shared as 40% by the Timor Sea Designated Authority and 60% by Minza Oil & Gas Limited.
Production Share - Cost Oil features (basis of calculation, limits on cost recovery - e.g. as % of revenue or production, capex uplift, etc.)
In each calendar year, Minza Oil & Gas Limited shall take and receive the following shares of every grade and quality of petroleum as and when it is delivered at the field export point: 95%, but not more than is equal in value to recoverable costs for the calendar year concerned.
In each calendar year, Timor Sea Designated Authority shall take and receive 5% of every grade and quality of petroleum as and when it is delivered at the field export point
Minza Oil & Gas Limited shall take reasonable steps to comply with the proposals which accompanied its application under sub-Section 5.4 of the code for this agreement in respect of training, employment and the acquisition of goods and services (such proposals are specifically listed at Annex D), and shall:
(a) give persons based in Timor-Leste a real opportunity to compete for delivery of goods and services, provided they are offered on competitive terms and conditions;
(b) with due regard to occupational health and safety requirements, give preference in employment in petroleum operations to nationals and permanent residents of Timor Leste; and
(c) within 30 days of the end of each calendar year, submit to the Timor Sea Designated Authority a report demonstrating compliance with the above obligations.
Minza Oil & Gas Limited shall take reasonable steps to comply with the proposals which accompanied its application under sub-Section 5.4 of the code for this agreement in respect of the acquisition of goods and services (such proposals are specifically listed at Annex D), and shall give persons based in Timor-Leste a real opportunity to compete for delivery of goods and services, provided they are offered on competitive terms and conditions.
Except with the consent of the Timor Sea Designated Authority, Minza Oil & Gas Limited shall draw to the attention of suppliers based in Timor-Leste and Australia, in such manner as the Timor Sea Designated Authority agrees, all opportunities for the provision of goods and services for petroleum operations.
Tendering for goods and services for local/offshore use will be advertised in Timor-Leste, with preference given to companies based in Timor-Leste.
Minza Oil & Gas Limited shall take reasonable steps to comply with the proposals which accompanied its application under sub-Section 5.4 of the code for this agreement in respect of training (such proposals are specifically listed at Annex D).
Training of Timorese staff will include language training to ensure high standards in Portuguese, Tetun and English. For the senior post a nontechnical training will be given in the operation of the oil industry, probably by means of an overseas training course. For both posts computer training and health and safety training will be supplied. It is the intention of Minza Oil & Gas Limited to employ one or more Timorese graduates as trainees in our primary operating location. If suitable candidates can be recruited, depending on their qualifications they will receive training in geoscientific, engineering, legal and/or financial aspects of oil industry; and health and safety with emphasis on marine facilities. These staff will also be trained to act as a primary link between Minza Oil & Gas Limited and the Timor-Leste Government.
It is the intention of Minza Oil & Gas Limited to support undergraduate training in Timor-Leste, in particular for students in the fields of petroleum engineering, geology, geophysics and associated business. This program could run alongside a sponsorship scheme and/or work experience opportunities for suitable candidates. Other program/schemes can be devised in accordance with the need of Minza Oil & Gas Limited and the existence of appropriate circumstances.
Minza Oil & Gas Limited has provisionally identified a number of Timor-Leste citizens that could fulfill roles within the company, subject to their availability. The above proposals will involve a minimum commitment from Minza Oil & Gas Limited of US$ 40,000, but clearly their intention is that expenditure on the Timor-Leste employment and training components of the project will be considerably larger than this figure.
The training for Timor-Leste staff employed by Minza Oil & Gas Limited, as summarized in section (a) above, will result in the transfer of skills and technological expertise to Timor-Leste nationals. Our long-term aim would be for Timor-Leste staff to rise up through Minza Oil & Gas Limited organization, and eventually occupy positions of managerial responsibility for the Timor-Leste projects.
Minza Oil & Gas Limited shall provide for third party access to the structures, facilities, installations, equipment and other property within the contract area on reasonable terms and conditions. Minza Oil & Gas Limited shall use all reasonable efforts to negotiate a satisfactory agreement for third party access, and where mutual agreement cannot be reached, the Timor Sea Designated Authority after consultation with the joint commission, shall set the terms for such third party access after taking into account internationally accepted
principles, good oil field practice and operational requirements and standards.
In each Contract Year mentioned below, the Minza Oil & Gas Limited shall carry out an exploration work program and budget of not less than the amount of work specified for that contract year:
Year 1:
Data Evaluation: Interpretation and reprocessing of existing seismic data. Systematic review of the hydrocarbon potential of the contract area through integrated geological, geophysical, structural, geochemical and other studies.
Surveys: Purchase of 2051 kilometers of multiclient 2D seismic.
Wells: Nil
Year 2:
Data Evaluation: Interpretation of new and existing seismic data. Systematic review of the hydrocarbon potential of the contract area through integrated geological, geophysical, structural, geochemical and other studies.
Surveys: Acquisition and processing of a minimum of 500 kilometers of new 2D full-fold high quality seismic data.
Wells: Nil
Year 3:
Data Evaluation: Interpretation of new and existing seismic data. Systematic review of the hydrocarbon potential of the contract area through integrated geological, geophysical, structural, geochemical and other studies.
Surveys: Nil
Wells: Nil
In each contract year mentioned below, and unless Minza Oil & Gas Limited has relinquished all of the contract area before the start of the 4th contract year, Minza Oil & Gas Limited shall carry out an
exploration work program and Budget of not less than the amount of work specified for that contract year:
Year 4:
Data Evaluation: Preparation of well prognosis. Confirmation of drilling location for 1 exploration well.
Surveys: Nil
Wells: Nil
Year 5:
Data Evaluation: Nil
Surveys: Nil
Wells: 1 exploration well to a depth regarded as sufficient by the TSDA to fully
investigate all exploration prospects of the chosen location.
In each of the 6th and 7th contract years, and unless Minza Oil & Gas Limited has relinquished all of the contract area before the start of the contract year concerned, Minza Oil & Gas Limited shall carry out such exploration work program and budget of not less than the amount of work specified for that contract year:
Year 6:
Data Evaluation: Systematic review of the hydrocarbon potential of the contract area through integrated geological, geophysical, structural, geochemical and other studies including the integration of new well data.
Surveys: Nil
Wells: Nil
Year 7:
Data Evaluation: Systematic review of the hydrocarbon potential of the contract area through integrated geological, geophysical, structural, geochemical and other studies including the integration of new well data.
Surveys: Nil
Wells: Nil
If a dispute arises between the Timor Sea Designated Authority and Minza Oil & Gas Limited relating to the interpretation and performance of this agreement and relevant provisions of the treaty and the code, the parties shall attempt to resolve that dispute by means of negotiation. If such a dispute cannot be resolved by negotiation within a period of 90 days, either party may submit that dispute to arbitration.
Arbitration shall be conducted in accordance with the Rules of Arbitration of the International Chamber of Commerce (ICC). The place of arbitration shall be Singapore. The language of the arbitration shall be English.
The majority decision of the arbitrators shall be final and binding on the parties. An award made may be enforced in any court having jurisdiction for the purpose.
Both the Timor Sea Designated Authority and Minza Oil & Gas waive any claim to sovereign immunity which they may have, both as to process and execution. The obligations of the parties under the agreement shall continue pending the resolution of any matter submitted to arbitration.
Except with the consent of the designated authority, or as required by law or the rules of a recognized stock exchange, Minza Oil & Gas Limited may not sell or disclose any such data, information and records without the consent of the government or as otherwise provided in this agreement.
Except as otherwise provided in this agreement or with the consent of Minza Oil & Gas Limited, the Timor Sea Designated Authority shall not publicly disclose or, other than for the purpose of the administration of the treaty or the code, or as otherwise required by the treaty or the code or for the purpose of the resolution of disputes under this agreement, make available to any person, any data or information until the earlier of:
(i) 5 years after the data or information was acquired by Minza Oil & Gas Limited; and
(ii) this agreement ceasing to apply;
Except with the consent of the Timor Sea Designated Authority, and in accordance with the conditions (if any) of the consent, Minza Oil & Gas Limited shall not disclose the data or information other than:
(i) to its employees, agents, contractors and affiliates to the extent necessary for the proper and efficient carrying on of petroleum operations;
(ii) as required by law;
(iii) for the purpose of the resolution of disputes under this agreement; or
(iv) as required by a recognized stock exchange.
Minza Oil & Gas Limited shall procure that a person to which the disclosure is made maintains the data and information disclosed to it confidential.
Except with the consent of Minza Oil & Gas Limited, the Timor Sea Designated Authority shall not publicly disclose or, other than for the purpose of the administration of the treaty or the code, or as otherwise required by the treaty or the code or for the purpose of the resolution of disputes under this agreement, make available to any person, any data or information submitted to it by Minza Oil & Gas Limited which:
(i) is a trade secret of, or other data and information the disclosure of which would, or could reasonably be expected to, adversely affect, Minza Oil & Gas Limited in respect of its lawful business, commercial or financial affairs; and
(ii) was clearly marked as such when it was submitted to the Timor Sea Designated Authority.
Without prejudice to sub-paragraph 13.7(a)(i):
(i) the Timor Sea Designated Authority may, at any time and from time to time, serve notice on Minza Oil & Gas Limited requiring it to show cause, within the time specified for the purpose in the notice, why information should still be considered a trade secret or other information as mentioned in that paragraph; and
(ii) if Minza Oil & Gas Limited does not show cause within that time, the data and information shall no longer be a trade secret.
This agreement shall be governed by and construed in accordance with the laws of England without regard to principles of conflicts of law which would otherwise direct the laws of another jurisdiction to be applied