NOTICE: The text below was created automatically and may contain errors and differences from the contract's original PDF file. Learn more here

 •»' .

















■V’






































}





 y Y • ■ o 3LJjj Y* ■ ^ Y"\








X440

jj^jj a«\*m hj^y\ A^i\ ^ ^ Jx^t jij>J i&rj&i


,1-g 3jblj oljW^-*VU JjLr^ 3£*


J\jjjfojzh jfi-J 0ja-j\j3r aT


6jiU

OyUJlj ^Vt

Al^cwlj J^t ^ O^JJ >

a>gi-i

WAWhJf |*UiU


«


; »Uj«L^I J-3_j « A.-csi VI (jjjLaJI >-^vju-m)I ^Jj^a


(^’Vf 6jCU )


Z^oLaJI JjjJwD i-aL*JI ijj-^all ji


f-^Jj-^. UJ~~ ■*»■:Lr*- A^lr^J J-".j~J ob^-lil _bjo J*_rJiJU


iJUji Ji-UJ . Aj[. ^ Uu Ji.....g_r* fjtUr'i jSLj 55"JXo-J {c«*>uf)


\ YA jtij o^UJI l->j-c Jj_*il ,' ^VY' a«lJ jtij jj-JLlJI u-jv^x JjjL-JI ^Ij-JVI





ii_J^ ^ JXi-i---,ij Jj^gi mA v ^ ^uaij \

. 44jhjj~\jiisgi Js-j_gu fe*cUjj, (j^ji ^gi j;s .*.


<

il)J jLi!l “6j_J 3---ii,H £j





* ^ £0-^ J r\SUl ^* U±u-VU Jto,


.(&/&{ wan


* Kr^ CO1^ fjfiN l^ !>^' *- J-ajj t |J^ ^


■ 4^’j5 cr* ogur iibj. ihjjf 0yujf iju ^


 mraiuj^o^j^Li/i








>AVi &*J 1VA j*5j ij^jUJl ^.o-oJ Ja&4I


1 WA &wJ V





tfjyiuMil 5 JjjIJI ■~-'v





4LUJ&JI JM34 {Uj^Jb^An


JyjjA]

JjjiJJ




£*d uLfr^^uiAf 5jfitj wIjIwjm^U jjjii 32^15


£*J 32jji$


«



§*(2d





*£*i*46


^ ' ' ®d*«' j-4-~'> Cr° |v-*^ L5^ ^ jLij)


*i-r^l -) t jl "-^■|»-^" Jj UJ l^Ac jUiJj) ^0*J!





( 4j_._0j|" (^fL La-j-S Lf-JU jiiajj) Jj-LaJ ,jj) #>^Jx J*-ii Ic





h^i\ yM fUU)l 4L$I





V * * 0 A.w» r « U ) Y *\ J JmJ I --- 1 S-b^yj-1


AMENDING AGREEMENT


OF THE. CONCESSION AGREEMENT


ISSUED BY LAW NO. 65 OF 1973


AS AMENDED BY VIRTUE OF LAW NO. 138 OF 1974


* . AND LAW NO. 7 OF 1978


FOR PETROLEUM EXPLORATION AND


EXPLOITATION


BETWEEN


THE ARAB REPUBLIC OF EGYPT


AND


THE EGYPTIAN GENERAL PETROLEUM


CORPORATION


AND


THE GENERAL PETROLEUM COMPANY


AND


PETZED INVESTMENT AND PROJECT MANAGEMENT LTD.


AND


GREYSTONE PETROLEUM (EGYPT) LIMITED


AND


PICO INTERNATIONAL PETROLEUM SERVICES PANAMA S.A.


IN


SHUKHEIR OFFSHORE AREA


GULF OF SUEZ


^ . A.R.E


Tins Amending Agreement is made this day of , 2005 , by and


belween the ARAB REPUBLIC OF EGYPT (hereinafter referred to as


''A.R.E." or as the "GOVERNMENT"), the EGYPTIAN GENERAL


PETROLEUM CORPORATION, a legal entity created by Law No. 167


 t - * 0 Ai** ^ b ) V A i J-»J I ~ AnhftwjJ I i-Uj-i-1 ^





jl^ i^jx-LJlSj 5_----y> |.Lc ^Lks iS^^Aj


*Sj-^ IS*J .AifcJ SjUlj OljUiw^U -bji ii’j-ij ^“-t3


i^hjj ) ;,A^.-J< Aj*^j uru[>2J tiJs iLoJlij A*JjX*i*6 oli


k


ofi 5-S*_r£ ^jr^J (*---f*«Jjj.r,..,^)^ iS”


Lw-S U-J-C JjJlzjJ jJ.*. (jyljJU ljui- i-Jtij i---oj-^-« aJjX---«o


-*ol .^f Jlj^UjiiljS^i^j Cj_^f>f'‘ JL


Cj^i" Ji U*i 4-Ja tjUajj ) U^j^. uylyU'ULt a-JLS. i--->*3u*U^


^11*, "JjUil" J-i L*s uyu^ - jSL* "j "o^l^" J " J_D Jltij)


. ( g.‘.







2Sj**j ‘■Jj_r“JJ Ajj-at! 4^jjJ,lj j+a-6 Ajjj~^h> A^jj5s> ji


\‘\Vr^J'\oriJ o^UJI ;^UJ[ p[JJVI A*jU;l jJ jJ^V


iiiilo ^ J>Li_z---Ij

U-j LfJj: jUajj) N'WA a^J V JjuII Jj>^U jJJ IS


t C"rljsWli-SU;r Jl,


r^1 a-^iUjl ts3 JjUii ^i .ovjijj sjui «u-i c^_,


fJjj* „U^J oU.^11 Sjblj lTjIjL* -,-Nil


^ liU [j^J (c^I) rJJj^ ^|J


■ m^i^ La1»


 Y * ■ 0 w> f ■ (^U) Y't --- *L-a**^ l








GENERAL = PETROLEUM COMPANY, a public sector company


organized and existing according to the Presidential Decree dated


2/9/1957 (hereinafter referred to as "GPC"), PETZED INVESTMENT


AND PROJECT MANAGEMENT LTD., a limited liability company


organized and,existing under the laws of Gersy state ,United Kingdom


( hereinafter referred to as "PETZED"), GREYSTONE PETROLEUM


(EGYPT) LIMITED, a limited liability company organized and existing


under the laws of BRITISH VIRGIN ISLANDS (hereinafter referred to as


"GREYSTONE") and PICO INTERNATIONAL PETROLEUM SERVICES


PANAMA S.A., a joint stock company organized and existing under the


laws of Republic of PANAMA (hereinafter referred to as "PICO"),


(PETZED, GREYSTONE and PICO shall be hereinafter referred to


collectively as "CONTRACTOR" and individually as "CONTRACTOR


MEMBER").


WITNESSETH


WHEREAS, the GOVERNMENT of ARAB REPUBLIC OF EGYPT,


the EGYPTIAN GENERAL PETROLEUM CORPORATION and


TRANSWORLD PETROLEUM CORPORATION, have entered into- a


Concession Agreement issued by virtue of Law No. 65 of 1973 for


Petroleum Exploration and Exploitation in SHUKHEIR OFFSHORE


AREA, GULF OF SUEZ as amended by virtue of Law No. 138 of


1974 with the EGYPTIAN GENERAL PETROLEUM CORPORATION,


THE GENERAL PETROLEUM COMPANY and TRANSWORLD.


PETROLEUM CORPORATION as amended by virtue of Law No. 7 of


1978 (hereinafter referred to as "Concession Agreement" ) ;and


WHEREAS, as a result of several assignments, the CONTRACTOR


in the Concession Agreement is PETZED INVESTMENT AND PROJECT


MANAGEMENT LTD. and GREYSTONE PETROLEUM (EGYPT)


Limited (formerly RACEBROOK PETROLEUM (EGYPT) Limited) and


PICO INTERNATIONAL PETROLEUM SERVICES PANAMA S.A.; '


 V • * o Z+jjj V- ^ (gU) Y"\ jJjJI --- sJUjil A





yU&*J oUJU-Ju oljUii^t ij *r■JvJ- o'


^JLi Ji*- eJU -Uj 4_JU;I jl»j J^Jjw t#5 vA*y


! J*A*xJ) lift *->UJ (J* kJl 4>UU;


6


liA J,_uJl JUjI JX ^'j ^ i.UII Ai^tU 1>M lA- jl


. (jUJI IJjb ^y iuj^JI A*JyU)l ok lj9*VI ilpjl


: ol y U Jx 4JI jUll iyttrtl ol>i J* eUU


(^fU 6jl4f)





U \ ^VA V j^UM y *^UM #jU( Ji^*3 ^-W^1

C»LoU-».VIj Zi>---iklll y_o *jj-| (*JJj y. , [^ JjJ-*-iJ) (jLij| j_ikLo


Ljjl jLi^) (\ “ wO yJ-L'n

. ("iikai" _, jL; m


u**j. Bji te*> Jy-jcJI i3^ s-Uj ffyJVI lylfcl *yS -u ( ! I )


»_yi JjCiif Y • - o/V/YA ^ (o-J * c>|y*- (e)


jtti-l ‘r^rj* sjW^' ij-z oiljj oly- {0 ) o---^ 43-1-*


si* jLuu^l Jt-5 j-tf-*' (^) ^j«*---i# a^-hJI >:


■ Jjy^' jOJ


oly--- ( 0 ) U">^" ^ fjLZ-a'V I 6yj ijU; (Jfij


oLclkil! ^ JU^U Oikil y, r - J ■ /V/YA ^


. J

■&---C Jii V lii*# (jUilj oLlfcjJLj ioJUJI 4i"^_a JjLai^ (v v).





o 17^)1 oIjXa? 0s® jX)5 t ® ®.....^ ^-ili (jfoX-o


Y • ■ 5 / V / Y A |jj-o 1a*j 6yj oJ^vdl


( Y o.....) <_ii! djLw»^>J

(ioj^s; j jtjXJ ^OLajf oLL-^J *t-lS^j^sVf oU*itjJI o


'u^i g- .'.a- .(fl_T ‘ eg---w ^>lt,_a (. L-=-!j 0'>tL_-f^i]|


/ •:■ •'■ <| y'1' \' /


.::'v'^: V. '^Vi ji^ji ■%'!


J. ■ •


OMW 4V <


1 O' *M “


 Y • • 0 4.«.m» A*jjj Y • ^5 (U) Y *\ I jJI f





WHEREAS, CONTRACTOR desires to spend additional investments for


carrying out additional Exploration and Development operations and to


amend and extend the Concession Agreement and to extend the period


of SHUKHEJR OFFSHORE Development Lease in the form of the Area


and coordinates hereinafter mentioned in Article 1 of this Amending


Agreement; and


WHEREAS, the Board of Directors of EGPC has approved such


Amending Agreement, and agreed to take the legal procedures required


therefore.


NOW, THEREFORE, the parties hereto agree as follows:


ARTICLE I


Add the following at the end of amendment Article JI1 2- of Law No. 7


of 1978


The Area in this Amending Agreement, is that portion of the area,


described by the boundary coordinates hereinafter referred lo in Annex (A-l)


and the illustrated map in Annex (B-l) , (hereinafter referred lo as the


'’Area1').


(aa)The term of the Concession Agreement and the period of the


Area according lo this Amending Agreement, shall.be extended


for five (5) years starting from 28/7/2005 . An additional


successive extension period of five (5) years , shall be granted to


CONTRACTOR, at its option , upon six (6) months prior


written notice to EGPC before the end of this extension period


and subject to the approval of the Minister of Petroleum


At the beginning of the five (5) year additional extension


period that starts from 28/7/2010, the Area shall be reviewed for


determining the non-producing blocks and those not


participating in production and those where no Exploration or


Development Activities had been done , for relinquishment.


„(bb)During the five (5) year period that starts from' 28/7/2005, '


CONTRACTOR through Operating Company shall spend a


minimum of five million and five hundred thousand U.S.


Dollars (US$5,500,000) as Exploration and Development


Expenditures, including two million and five hundred thousand


U.S. Dollars (US$2,500,000) for wells repairing operations ,


facilities renewal and acquiring 3D seismic .survey, and also


 * \ -**■'---~U oLX>JI Cr° jVjf (f......) uruX---# a^Ij


. t>: 1


j^JUi JjLall j»jdL (_^ sJ>lj O ) j^i j&J- d~S^jJi\


. aAc. Zti\jl\j ii^l y AiJt>ljl liUJJ j,_pUI J-uJI


(\ ~ £) ,£*JIL rf-i----




I CjLUj y Jjlil! oLolj^il y jJ-l


• -b-(j Ua jJj-AxJI ijLajl jijj g^Jr* ^*1 5jUi #j-£j l^-Jx-


<


y i-JlS* j*LU CujJI A^aJ* jl/^ jla-IaJ jLaXaJI IJlo>


^(60.. . ■ ' ) k~dil (jV^Lo 4«.» j-l ^Lyi (jru ,j_ji!l aJI





J-aJUllI A.zJuu\ ^J-UI ^JLilj A---Soj-aS/I bjL?ixl( OLVjJI ye


j-a-X-W . (j^-_*JI) AjL~-jJI y toLa-T-tl JjUll y- AjLL Sbj oL-iajJL


01jX*.v ( 0 ) iyms Aj Lj J-*j j^-i-'l (*\ ) AJL** »jI iJ^jL_.iaJI


- a*JU> ( liUjiiJl ^ IfcU ^>^11 V - - o /V/U ^





ijjs JiJxJI ^UjI ^JalAC A--XJlj C^-JI y ASyb- JjUll ijUo' iJU <_yi (^


^ i-uj (jjJI (o) a^U-I auJI i-L^: jac J J-J aJLjo t>ull j^.Jl Jx-


Jjj 1*L«« 4-i^o-Lxllj oLLa-& ^L-c (3^1 xs J.U1I T • . o/V/YA





!>* t o ^.....) iwiJi AjI a-m. ajLIj ijU^lLe J -■■ n J-t |«JL_a , -»- a


AjL^_j Jit JjLall jlS^ li| La aJLp- ^ jl t-UjSL^oVl C»IjVjJl oljVjJ


lAjlJj Ajli 4 ^J-J.1 Ua ^£. Jij L*-L-o AJiLill ^ ^iji Jj (o) A-^lil AixJl





*9 t k


iy£kj> a. 1 H ^Ju-a (>w 'wjL*---a L*L-0 A * : ^SJu ^ UjLilt (^-P’


Ubtxll CjU^,^-a ( 0 0.....) !_*}) AJU---jJ-lj


*iIsllII A*aJxJlj oLL-t (J-e aaLI ,jiJI ^JLtl iXy A-iJC*-’


v c


*■! (y j-4-il i ) Ala jl X* AJL^U ^Lll IjA Oj^ii


Jij>vi.r. • o/v/rA ^ ix?(o} wuluui


l---.


Vf jjM J^ua* iUiaJl f


 ' Y • • o ii** 5LJjj Y ■ ^ (^lj) jjjJI - I*.*.,,*J\ 6-b^J-i





one (i) well in the Area provided that CONTRACTOR shall


submit the necessary work program to be reviewed and


approved by EGPC.


CONTRACTOR shall submit a Guaranty to EGPC in the


form specified in Annex (C-l) covering its minimum


Exploration and Development obligations staled in this Article


above, one day before the signature by the Minister of


Petroleum of this Amending Agreement. Such Guaranty shall be


for guaranteeing the payment and/or transferring a quantity of


Crude Oil sufficient ill value to cover the deficiency between


the sum of five million and five hundred thousand (5,500,000)


U.S. Dollars and the amount of money actually spent by


Operating Company on behalf of CONTRACTOR and approved


by EGPC (shortfall).The Guaranty shall remain effective for six


(6) months after the end of the five (5) year period starts front


28/7/2005 stated in paragraph (aa) above.


(cc)tn case CONTRACTOR surrenders its Exploration and


Development rights under this Amending Agreement as set


forth above, before or at the end of the fifth (5th) year that starts


from 28/7/2005 , having expended less than the total sum of live


million and five hundred thousand U.S. Dollars ($5,500,000) on


Exploration and Development operations, or in case at the


end of the fifth (5th) year. CONTRACTOR has expended less


than that sum in the Area, an amount equal to the dii Terence


between the five million and five hundred thousand U.S. Dollars


""''“(US$5,500,000) previously mentioned and the amount actually


spent on Exploration and Development operations in the Area


shall be paid by CONTRACTOR to EGPC at the lime of


surrendering or within six (6) months from the end of the fifth


(5lh) year that starts from 28/7/2005, as the case may be.


 Y. *0 r. ^ (~b) Y"\ iJoJI - w








(iuiUJlfiJUl)


-r y* oJlSUJI ^,0-^1 rUU CojJI (I) 5*0^JIoUa; -Y





-: J-i u Jjlx-Jj J-ISJL \ ^YA x-J V ipUM <> *---y-l Jx*J


Jj^c 3jJUuj * li* JjJaiJI jlir! jL^*« Jju J-#^ (_yJ! * oLiiJ ---T


6 L^qJ <~«AJ ij * llil>> aj I «LL>

olLidl jl j\ o-JlSUJl cJLS* jl ajl* ^ <£jjl> Ijj ( oUx.ll





aa-J y-c Jj_jj aJUj » 3j 1_>J I (Y*) ( (t) * (N) oljiiJI |»lS\^-i (tabjJwJ i_*>ljJl


j.Li-1 CojJl 2-a-J jLj ( O £^JI oUi c_Ji ui-JtSUJI ilijiSi 0a.*i.jUI j.U-1 CojJI Ji*


: ^IkJ laJ? oJlXiJI jIjyoV


Ua l^oLii^lSyuJI^j ^kil, Jjudl^ , 0-^1 . aU^II jJUl (!)





ol>Ldl





.J.i^,.lf.,7.ll oliij (<_j)


- vO*JI oUiJ (^)





S’ • A.X.7.11 oliij ( j)


. J-lSUL 3^-J o* J! ^ j' to ^ J^- ^Lj luij


■^^1 ih^l ^ V ^SJj


jjJaj LaoLLlJ 1j ojjUailj o-Jl^jdl «LiL5lJ t; ■ _|| _\_,_\_*£, •





: ZJLJIrL5UVl


1 g -t*1 ■ I_6J OL-Lo_c olijjj? * J <_aJISsJ "Covjf oliij" (^)


. ijjbVI olij^^lj 5^il4| i .i. ,.


'---’LSjj-XI y-a





'ku^W'vJ1 -.•-v.'---;4)i





i,


-W


 t. a-Jjj Y' ^ Y*\ iJjJI - Lm








ARTICLE II


(iii) Development Expenditures (a) "Cost Recovery Crude Oil" of 3.


amendment of Article V of Law No. 7 of 1978 shall be deleted in its


entirety and replaced by the following :


■»


(iii) "Development Expenditures", which shall be incurred after the


Effective Date of this Amending Agreement , shall be


recoverable at the rate of twenty percent (20%) per annum


starting in the Tax Year in which such expenditures are


incurred and paid , to the extent that , in a quarter Calendar


year, costs, expenses or expenditures recoverable per paragraphs


(i) , (ii) and (iii) stated above exceed the value of all Cost


Recovery Crude Oil for such quarter , the value of the Cost


Recovery Crude Oil shall be allocated in accordance with the


following system of priority


(a) Carry- forwards ,if any, as prorated in the period from which


such carryforward arises,


(b) "Operating Expenses” .


(c) "Exploration Expenditures".


(d) "Development Expenditures".


and any excess shall be carried forward for recovery in the next


succeeding quarter or quartos until fully recovered but not after


termination of this Agreement.


For the purpose of determining the classification of all costs,


expenses and expenditures for their recovery, the following terms shall


apply:


I. "Exploration Expenditures" shall mean all costs and expenses for


4f|fe. '■■% T--o f-^ ^ xuJI - U


« >."'i;r- K:iJ-





« LmmuL t OL«kfcf. tlllijj---J «T "J . . !rll oLiij" ( V )


cLsjj-sailj aj--Lll olijj-iiil tf> Uj , "





•» .

^jjl oLi_iJI J olijj-^ll j uiJL&JI tif*j "J.. ; .;, vlf JujUw" (f)


oLH-idi j ojLsjj-aUj LS&j . JjVl -1_*4 c*-£iji


.tiU syifL^ki aLum





5JU---S- j j jLSfl jOL^I J-r dl oLij^^a-o J-uJJ t eU j £-0.


^ (Sidetracking) ^U-l J±\z Jb U t_,1 J*Jj ^ L^SUj


. O I Jj,A^(-J L O Ll^uu^td lj OliLis'Vlj (-j^o e Jj- jl JJ|.\i.T.,.mI j jZj


* t t


tb-® l^-jLLl j*J jjj.*.ijj j\ jf olij^a-a J J»lalf V


0L.U..6J t LoL> _^-<-JI jJl> j oUi (j-0 Jj* jLajI





jj-t i_slc U g-itl'xj jijjXu/\ j-o-z~uj Ck*j- ~Usj \ --- LoU-


- Ua JjcJ l 3Uj I ^ ii_yd 1 ^I iLiUj I ^j.aLl ILi?


1Op < V • \ ■ /V/VA ^ ijuj ^j| i-iLi/iM jfj-z-o’ifi ejsS idju (y> Ijl-jjLgl


,j«« A i *■ *-d I " d I Lfcjli^L*j| L^-L-o-^-j LpUjI ^JZj _}l C^y OLsjj---43_o


'^J ISLJI ilijJL-il lJa\j-tlfj .ol_flwf ( £■) £ijl ,_y."ii JL9w* ^Ij-d^l a*sL4jI





iL>l£JI oljiaJl jjx. l*ji J_fle f,l_>i)*i!! iLJLiU ii_^iJt oyu olijSf! (>»


U5L_; »jjb .11JLt-aVf SJ^i e J-i jlijZSi





.. Y • S 6 -C.i.u


 'V • • o ) n ijjiji --- ji1i








2. "Development Expenditures" shall mean all costs and expenses


for Development operations (with the exception of Operating Expenses)


and the related portion of indirect expenses and overheads.


3. "Operating Expenses" shall mean all costs, expenses .and


expenditures paid after the initial Commercial Production, which costs,


expenses and expenditures are not normally depreciable.


However, Operating Expenses shall include workover, repair and


maintenance of assets but shall not include any of the following:


sidetracking, redrijling and changing of the status of a well, replacement


of assets or part of an asset, additions, improvements, renewals .


CONTRACTOR shall not recover any Exploration or Development


Expenditures or Operating Expenses that was paid or incurred prior


to the Effective Dale of this Amending Agreement, except the drilling


costs of the well (Gama-4) and operations of repairing well of (Gama-I),


where it shall be continually recovered by the numbers of calculated


installments according to the terms of the Concession Agreement as


defined in this Amending Agreement.


From the beginning of the additional extension period that starts


from 28/7/2010, any Exploration or Development Expenditures paid and


incurred shall be recovered during the remaining period of the


Concession" Agreement, as a minimum of four (4) years. For Cost


Recovery purposes, at any time , the remaining Concession period is


defined as the number of complete quarterly Cost Recovery periods prior


to the termination of ibis extension period and including the third quarter


of the year 2015.





t


 ■ 6 A,--* 5-yJi ^ YA (jJ!





( <£juji «ui >


v rl> 6>;un, *>“ M «»aW j*jl* -y -y ^ to) ^


-. yL U Jj^j \'YA


C/AYjO) L'LLI ,_yi ltuLajj 0C-» 1 ^J--“ ■ *j ■iS'b oi <3^1 ^4^ *





^Wi^^iJjUUJjfiiioojji^.i*Mi (/■'O tfUiyi


■ili-Xsy, ^j ^J_[ . ( '/_ ^ Vjfi )

dUS (_y3 U < £jU-l ij> £^1 yi


OjjUJJ 3la---*U-i oULI (jA t i) \jjjJJ UlJ? Alla. Jjj jJ---rtVi p\i-l CojJl








(fculjJI tJUJ)


^vr iu *\o l*_ij jjjLaJI ^ *-~£j---o-J-1 ok l---(LeVI (S_r---iLaJI oUl )


-: U Jjui---jj





«aJI uUUrff


£jU-l & jl^Vl oUwaJL aJUJI JjUJJj A«U1) (!)





Cr-^J* (i* u-* v^f jl pj---j jf v5^ M ji a_^^-oJ-1 pj---Jl ly»


iljilj oL^IIj oIaaIIj or*! I^ULI Jj,\y}\


vJlS^U a^zJI 5j_*_>Vlj JUuVI JjLJI JJL-jj


jvi g*!jij oidjuj Ajj^jyf r_^->Vij jij-i ciLi.^j ^<1 -ij


aK dUij. 6 L^N/l »i* ^ ILoj^JI jLjJJ ^ ^UlSTj


^1* J ‘ '-H1 A~411 i**i1 AjZmil JJ^il ^








lia £» LJUb L^s- lAjUj ol^iJI fij> o^C'j . lift





1 1 * * * *


• ^>1 ole lj>[ jl j*>\j j\ oUil^ ;J ^x> *U*^1


/'.r-/‘p-JJ !''X \


•’■•i hv&T* \ \ tUu^Vl ^j-ik^ip^ulJ AiUl Aiu^i


i? y?fe^' l4


/g «





 V . • 0




ARTICLE III


Paragraph (b) of 3- 2- amendment of Article 5 (b) of the Agreement


in Law No. 7 of 1978 shall be deleted in its entirety and shall be replaced


by the following


(b) EGPC^shall be entitled to take and receive eighty two and half


(82.5%) percent from the remaining sixty (60%) percent of


Crude Oil and CONTRACTOR shall be entitled to take and


receive seventeen and half (17.5%) percent . CONTRACTOR


shall have the right to retain abroad all funds acquired by it


abroad, including the proceeds from the sale of Crude Oil


exported by it in accordance with paragraph (d) of Article V of


the law No, 65 of 1973.


ARTICLE IV


CUSTOMS EXEMPTIONS


Article X of Law 65 of 1973" Customs Exemptions" shall be deleted


and shall be replaced by the following


(a) GPC, CONTRACTOR, and Operating Company shall be


permitted to import and shall be exempted from customs duties,


any taxes, levies or fees of any nature and from the


importation rules with respect to the importation of machinery,


equipment, appliances, materials, items, means of transport and


transportation, electric appliances, air conditioners for offices,


field housing and facilities, electronic appliances, computer


hardware and software, as well as spare parts required for any


of the imported items, all subject to a duly approved certificate


issued by the responsible representative nominated by EGPC for


such purpose, which slates that the imported items are required


for conducting the operations pursuant to this Amending


Agreement . Such certificate shall be final and binding and


shall automatically result in the importation and the exemption


 /


v.. o ii**, r ■ jji (^t?) ^ “ a+AMijJi \ a





JLL^i’iIIj Ji^Jl JjL-jj s_j-4^-S/lj olj-*llj •x'iHl {j*


^ j a -aj 4_ajVJoM ^jVia *'“■■’


iljbw ,j_)i Ujo Jj-LoJI JUjI ^jXay> CjLUr*-U Uij *0a_wl ,j\ iji-UJI cy


C 4 * 4 4


^JlOj Jju liUij ^1 £A L^Lwl j\ |*_>---_) jl *->) J* (*_>---’J


eL-iV! I J-L^J 4JL4U 41-ju J^y UjJli 3-3.>l$-i


. IJL& jJjjmiJI jUj*^ ULsj oL-L>_«Jl; ^Li.ll


oLJ-wJLi iWlLaJl i*SjJtJlj JjLisJJ jjjuLxM .<■ v "4 (jO





it* {bj-z-j .^*-4-1 cy ^-*1cy ^(*^


^3 uyljiJI ijJL> ^jS *^l ^J\> irJl_;4aJl


fjrJnJ*-JiS\ djUSflj A-Jj-dl cjL^^U j^c- £_y-i * £-*j


J*La-»---U ^lj 1---aJ?j*a J£J [ l ^) 3-L>Ij iiiJi ^y Ic ]


c~sJ-U gj_ry$) j»U_izj ^j^j£ tiUij I_o-£w> jl oL-..La.i«Jli i_flJLi)l


t


ij---cai&X ( (4, f H Lfc4^-5*'AjI i 1


1 a Jii ft ..La. »iLi J^ajLail ajS”j^-a 1-


>Srjj.~.-.i*ll = jl ^c. ^yjlj l---A-T-JwJU jI_=_S,_pq»4'1 oUaL^Jl ^)) 4 X -s-^JI


f t


‘ I J La »J^*^ I ij-!*’-! ^ ’’jj-7--'^


V..- I <-aMI «Up ^jLi- ^1 lAjj J^aJi cJ^u» “ -."U





sjU/. Jyuw {J ,jdl iislj-a j^u , jy^ (j)


* c


^ j3 cj(5" bIj--- *t.T'C.(^^ cojj~i---'1 tU-i'il yX-^u


r^1j^ ^ r^ij v-n^ji ^ u^i-j r^i ^


4


jl jji Uijj.x^i ^JJ| COj jl ^ dUij lift JjJujudi jUjI


(>-^“,-J ^ (*_j---“j jl AjI j| yju^J AjI L^JLc ^7,---, ~.,.7


^ BLJ-^I £_o UJ1. Jj 6 U-i^l


L f ,,.B 3, \ _ IW*1 K®”*1 ^ “a M


'


^ ; Y • ,* 0 Y • Y*\ --- «*■»■,<*■■»>





(b) Machinery, equipmenl, appliances and means of transport and


transportation imported by GPC's, CONTRACTOR'S and


Operating Company's contractors and sub-contractors in any


activity pursuant to the operations which are the subject of this


Amending Agreement, shall be cleared without payment of


customs duties, any taxes, levies or fees of any nature, upon


presentation of a duly approved certificate issued by an EGPC


responsible representative nominated by EGPC for such purpose


which stales, that the imported items arc required for conducting


the operations pursuant to this Amending Agreement.


(c) The expatriate employees of CONTRACTOR, Operating


Company and their contractors and sub-contractors shall not be


entitled to any exemptions from customs duties and other


ancillary taxes and charges except within the limits of the


provisions of the laws and regulations applicable in the A.R.E.


However, personal household goods and furniture (including


one (l) car) for each expatriate employee of CONTRACTOR


and/or Operating company shall be cleared under the


"Temporary Release System" (without payment of any customs


duties and other ancillary taxes) upon presentation of a letter to


the appropriate customs authorities by CONTRACTOR or


Operating Company approved by an EGPC responsible


representative that (he imported items arc imported for the sole


use of the expatriate employee and his family, and that such


imported items shall be re-exported outside the A.R.E. upon the


repatriation of the concerned expatriate employee.


(d ) Items imported into the A.R.E. whether exempt or.not exempt


^ from customs duties and other ancillary taxes and charges


hereunder, may be exported by the importing party at any time


after obtaining EGPC's approval, which approval shall not be


unreasonably withheld, without any export duties, taxes or


charges or any taxes or charges from which such items have


been already exempt being applicable Such-items may be sold


 Y • ■ 0




J*r* OJJ o' ^ Uil->il C^J y^ ‘■W*-1 ^ -t'C't


fj-**jJ! j!ju«*j e L-iVl tX* #X» is^-i ■


L$jJU. Hij L^j Xi-?Xil yJlj^aJI ^ U>j LjL---Jl





jJLfii (j^ j*J L» dUij £*J1 c?® XijLoJI i*J>j*-$r I 2-ij_^*jJI i-LSj


* * ‘ * «


• AJU *Sj** \^i dot*^ jl 2*4 UJJ jl i5A3 « L^rVl


6


lift Cj'l>Ll2jxJLa £j_yj 4_JUu «lJI jLiil ^jJlC £~j ^i * Iy>\ X)l> j





< j K e L_..I^ 1 iXk i_i-J l£j y ft ^7_,.i,,j Lft J Ujh* [ Jj Ixl |


. XUfU . J>j o| < dUi JuJj La jix_5





« Lwii Aji ToLlI ftj* y> (i) ftyj}\ J^a 4_*ip tf>y~a I.U * Ul£*^1


IjT 6,5j>j \&>^0 j**£ -k* ji Z^jLj-a L$J Cjli' Iji ftijjZmA


jf oLJ-o-*JL< AjjIaJI JjLiil £j\jLsv\y Lg * % l_Jou y_^_'j


ci^JI (ji Ujij-i o^iJ oU>^lj °s^JJ i^JL U.g:» (jl


‘wJXj o-° i'/ ^ ■) ft^i_c ^ ^ 1jLa*-r®


oAx" <-iJl£j 2JUpI ^ ryJ\iiLbl





«


* ■*»? o' ‘ ouiUjJK




* L^v1 "4 * *5^ -M OJJ iikXf ^ gjdl


,'j----_? j' V°'j-i> j\ o* IJjft ^LLtl


‘lj*


/ \ --- r : ...... j


lvi:.!f !


V \ V • ■ 0 r ■ ) Y*\ jjaJI --- jJI ijjjJ-l





within the A.R.E. after obtaining the approval of EGPC which


approval shall not be unreasonably withheld. In this event, the


purchaser of such items shall pay all applicable customs duties


and other ancillary taxes and charges according to the condition


and value of such items and the tariff applicable on the date of


sale, unless such items have become the property of EGPC or


GPC or have been sold to any of EGPC's Affiliated Company.


in the event of any such sale as mentioned herein above,


the proceeds from such sale shall be divided in the following


manner:


CONTRACTOR shall be entitled to reimbursement of its


unrecovered cost, if any, in such items and the excess, if any.


shall be paid to EGPC.


(c) The exemption provided for in paragraph (a) of this Article shall


not apply to any imported items when items of the same or


substantially the same kind and quality are manufactured locally





meeting CONTRACTOR'S and/or Operating Company's


specifications for quality and safety and are available for timely


purchase and delivery in the A.R.E. at a price not higher than





ten percent (10%) of the cost of the imported item, before


customs duties but after freight and insurance costs , if any ,


have been added.


(f) ^CONTRACTOR, GPC and their respective buyers shall have


the right to freely export the Petroleum produced from the Area


pursuant to this Amending Agreement; no license shall be


required, and such petroleum shall be exempted from any


customs duties, any taxes, levies or any other imposts in respect


 Y • ■ 6 5LJjj V'- ^ Y“\ ---




■ (

\ 1\vr iuJ A0 fij ojJUJI y V1-^1 J ^jLJI “ai ^


---: U J


1


\^or a-j *\"\ fij o^UJJ oL-UjJL;^UJI £f-*± (I)


^-IjJJIj nol 5j_J A*\ ^jJUJL Jj^JI ( ^ rVsaUl.Ui^-l-)


oUUjJI t bl Ss UjTj iui%+*j (L^UJ-1 £jI_*J-)I tiUi ^ ^ * *iAj..*i'«I »jjL-aJI


ijlr3 ikiUt-JJj ii* ijUjV lj-i^


jl _>Ll_$j|y^ujj j\ L^j^Ljjju jl £jljJJI ti-* ^ (jl Cij^ ^


- Ij^4 tjbjl ^J~su‘ £® A--~-^-7-°


^ t

Jj loj O^vIaJ I. f . 1 e. |^ju JLS Lo_» ZyJLj-A^I ^.‘-j;)? jb---j


* 55


.ii-JI ^Jl^J jl uylji i>« lA-iiw


cr”-*-' * (j) iLiJLiJI 9jUf ijj L® e UiJL-'L i.fc)


* Ls-1" c-ol_r^±JI iiL5^ oLJL_*JL

j ,j-a _$} ^ i^j


*-**vJl ^jLc ijlJall *_a_j_i)l ^Lt A^j^-ssJIj oLfcj-II


jl jl

p-aiu pljjJl Ji'j Llj (U3G) jL-dl Jj^aJI jU iJs-


LrtJf oljbij A_iaJ| oUjjLI ol*jj_y (jii; ,_p?jij


<-#^c ^ bijl JjUi! . dUi AjLi Laj ijoL*lL*ilj .





-JWjjJ*


 r V . . d V' • ^ (^b) iJjJI --- 4***^^16jj_^LI





ARTICLE V


LAWS AND REGULATIONS


( Article XVI) of Law No. 65 of 1973 " Jaws and regulations" shall


be deleted and shall be replaced by the following


(a) CONTRACTOR and Operating Company shall be subject to


Law No. 66 of 1953 (excluding Article 37 thereof) as amended


by Law No. 86 of 1956 and the regulations issued for the


implementation thereof, including the regulations for the safe


and efficient performance of operations carried out for the


execution of (his Amending Agreement and for the conservation


of the petroleum resources of the A.R.E. provided that no


regulations, or modification or interpretation thereof, shall be


contrary to or inconsistent with the provisions of this Amending


Agreement.


(b) CONTRACTOR and Operating Company shall be subject to the


provisions of the Law No. 4 of 1994 concerning the


environment and its executive regulation as may be amended ,


as well as any laws or regulations may be issued , concerning


the protection of the environment.


(c) Except as provided in Article HI (g) for Income Taxes, GPC,


CONTRACTOR and Operating Company shall be exempted


from all taxes and duties, whether imposed by the


GOVERNMENT or municipalities including among others.


Sales 'fax, Value, Added 1‘ax and Taxes on the Exploration,


Development, extracting, producing- exporting or transporting


of Petroleum and LPG as well as any and all withholding taxes


* *


that might otherwise be imposed on dividends, interest,


technical service fees, patent and trademark royalties, and


similar items. CONTRACTOR shall also be exempted from any


tax on the liquidation of CONTRACTOR, or distributions of


any income to the shareholders of CONTRACTOR, and from


 Y ■ • fi IJjj V- ^ t^l") Y't i-uJl - Y l





UM Jy* ajjLJIj ia* j^a**)! jUsi ^ JjUiij iaijji oUi_)ij|j jjSp. (3)


J ^J~r* ’LM’J ^ JiJUcJI oU-l rl5UV ij^u 0^J


ol^ sAiU^il yb o^iSU! lii^Lill ylirVL VI L^Ljut


. tuLtfSfl i*sUjVI L^j OjXjs ole Ij>-VI


Cy3 L»*>jJjUL»j oLX>.«Hj ^Sa-iu (_&)


i_oL*Jl ^ ^5^-orVj

uuiJl ^>t»LJI y p+Jj\JU>j oLjLjJI. i^JUJI 7SjJJij JjLillj


j~aj £a a-J> ^a)I yAiH* j?*V CJj (V> 5_«_^J-| Uj«U*j j) AjI


* *3^-1 0_j^i ( 1Jl& JjAjlzJI





oUujJL LoJLijJf 7SjJ*Jlj JjUlIj i-aUi * Ia* JjJulJI jUjI ^>1j-eSfj ( j)


flfll S_i_-oAJI (>* C>A~-'-*3^ Cr^W^ O* {*>&jJjLiL^oJ pbjkjU---Aj


j i*jUJI yO^JI oLLi-lj


*^ JjAjcJI JJLiuIj I


JjjjuiJI JUjI U* (j-* licVl ,J5" (j)


^j^JjLLuj JjUIIj i^iUJI ^Jl Iaa


JjJu*J ^y> L^JlC ijkj Llj LJU- IjjLJI ^>U^b Obllj^Jl AUj J-> ~“5


t


- ^ky-......* l^U-* J^d jl





(




U* JLajI


Oj^LaJI Jj *11 t tVf 7S -j ‘to ---SJI yo-jA 4-j-sUjI


LHJj U^sij L*Jji luL- N “WA a-J V ^ j^UJIj N ^Vi J ' rA ^


 0 4J.I




The rights and obligations of. GPC and CONTRACTOR


hereunder, and for the effective term of this Amending


Agreement shall be governed by and in accordance with the


provisions of this Amending Agreement and can only be altered


or amended4by the written mutual agreement of the said





contracting parties in the same procedures by which the original


Agreement has been issued.


(e) The contractors and sub-contractors of GPC,CONTRACTOR and


Operating Company shall be subject to the provisions of this


Amending Agreement which affect them. Insofar as all


V regulations which are duly issued by the GOVERNMENT apply


from lime to time and are not in accord with the provisions of


this Amending Agreement, such regulations shall not apply to


GPC , CONTRACTOR, Operating Company and their


respective contractors and 'sub-contractors, as the case may be.


(0 GPC, CONTRACTOR, Operating Company and their respective


contractors and sub-contractors shall for the purposes of


this Amending Agreement be exempted from all professional


stamp duties, imposts and levies imposed by syndical laws with


respect to their documents and activities hereunder.


(g) All the exemptions from the application of the A.R.E. laws or





regulations granted to GPC, CONTRACTOR, the Operating


Company, their contractors and sub-contractors under this


Amending Agreement shall include such laws and regulations as


presently in effect or hereafter amended or substituted.


ARTICLE VI


Except as specifically amended by this Amending Agreement, the


Concession Agreement signed by virtue of Law no. 65 of 1973 as


amended by virtue of Law no. 138 of 1974 and Law no. 7 of 1978 shall


 Y • • 0 iw y_ V • ^ ^ ^ i-UJl - 5-***-^1 fiJj^l Y*\








(£iuLJf Mill)


jU.^! j_*j *_jic Sn j* ^ (jUji jjS^j


i>& 4-Jx £-_5jjJL Jjj-=-Ji j^LiJ ^ 5---O-L^JI olkLJI


jIaJ tHiLfcgjjiill Sjl.atj L^ljL^.^yr ^5^





: 1$---Is-





iM*} (wmmI) 3Sj^i





.................................. : U---^


*







JajiJJ t^lsJI &Sj4*iJI


............ : 1$---Lc-







...................... : ^---'•£>








i


 YV Y • • 0 2m Y • ^ Y^ ijjOl --- ^l eJuj^l








ARTICLE VII





The Effective Date of this Amending Agreement shall be the date it


is signed by the parlies after a law is issued by the competent authorities


• ft


of the A.R.E. authorizing the Minister of Petroleum to sign it on behalf of


the Government of the A.R.E.





PETZED INVESTMENT AND PROJECT MANAGEMENT LTD.





By:





GKEYSTONIS PETROLEUM (EGYPT) LIMITED





By: .........................................





PICO INTERNATIONAL PETROLEUM SERVICES PANAMA S.A.





By : .........................................


THE GENERAL PETROLEUM COMPANY





By:





THE EGYPTIAN GENERAL PETROLEUM CORPORATION





By : .........................................


THE ARAB REPUBLIC OF EGYPT


 Y . . 0 Ai- i-oi r* Cfi VA j-uJI - YA








* V tjsp j-l-i ^JJIj SiJaiJJ i-tf'JI J?LUI oUU*-V VJbu J, j^j 3jjJj


: l 'l - I ) J*UI ^





0-)),§aJU


a


smJ) jri&ui &Ja*4





: 0 ) AAtuil oUfiil:^5l





Jjjs Ja_i. j iJaiJ


Vr \t y. Va -.<\ Vr >


Vr Vo y. Va '. ^ Vr r


Vr V'x yY VA A Vo r


N ^ ^ J^LJ JUJI Jll ttL* SlSU*





: ( U ) 35W) : ttti





4*-^ 'ki. Ja_> j*5j Akflj





Vr ^ ,u Va Vn N


Vr /vr ^


Va -. o ffn ■r


Vr Yo


rv Va '. ^ 5\r,r r





^-L> J>LJ ^UJJ jii aL-a -U> VU-i











4j|WVi &&u)i • •■•■••- ■»±r


-y» <^, •»-





i j i: v w


V ,


 Y* Y • • 0 jj--- Yt i-u)l - .L.wJI





.Coordinates of the comer points of the Area are given in the following


-table which forms an integral pan of Annex “ A-l"


Annex “ A - 1 “


* BOUNDARY COORDINATES


OF


Shukeir Offshore Area





Boundary coordinates of Area “A”


POINT NO. LATITUDE LONGITUDE


1 28° 09’ 32” 33" 14* 30”


2 28° 09’ 32” 33° 15' 20”


3 28° 08’ 15” 33“ 16’ 32”


North along the high tide line of Gulf of Suez coast to the point 1





Boundary coordinates of Area “B”


POINT NO. LATITUDE LONGITUDE


1 28“ 05’ 36” 33“ 19' 14”


2 28“ 05' 36” 33“ 22’ 06”


''v 28“ OF 13.3" 33“ 25’ 37"


3


North along the high tide line of Gulf of Suez coast to the point 1


 Y • • 0 A.L# i*jjj 1* ♦ ^ aJjJI --- *U*---^1 Sjj^i.1 V











« ^ --- ._I » (Jfr/vlJ. I





jAui 4-fl)n.u










































































ANNiCX (IM ) (


AM UNI)INC AliUKKMKNI'


(II' TIII'CONCUSSION AUltKKMKNT Jluul H Y t* Ai-J ' 5 ?ij yjjllj'


i.SMIKD IIV UWNIU5 OK ]')?.'


AS A.MUNDI'.D l;OK rl'ITIUlUaiM UXI’I.OliATION AND AJXi'uAj Jjjiill (_f-


KNITOITATION


m-TWKliN OH _





riiKAK/Ui liKrun.ujoi'KDYrr J


AND


Till-:Kt;Yl*MANCKNI*:Rf\I. Pr-rntOLKUM COIU’OIUTION J


AND


•mi-(jKNiiiui.i'rmou-UM commnv J jjlJJ

AND J


l*fnXKI» INW-^IMKM' AND I'JKMIXT MANACMMKN !' I.I D. iuj C‘Li ej'-i J ijljUiWAJ HjH


AND J


CUKYKIONK rii'l ItOl.tX'M (KCVI'M I.IMI11'.D ^r“') r^jJ~


AND J


rico inii:i(na i ionai. n;i hoi.i:um si-kyuxs iwkama s.a. aj.^hI imi f uijjy J&# Xiji


in


SIIUKIIKIU OI J 5IHJHK AUIIA


CUM' UKSDK7. ■t-f-E


A. II. I-.


scai.i: i : imi.mil> 1.....; l











tiumam





f.u 1


 n V - • 0 iu- LJjj r • J> ijbJl -














annex “ B-r





s 11! 11C HEIR OFFSHQ RE AREA





i'JJC





























SVtZ























EAjiniiM


OESCHT























ANNEX (B-f) i .vjd< aj)L/i!i





AMENDING AGREE* JE\T


OI'TIIK CONCESSION AGREEMENT


ISSUED BV UW NO. 65 OR I9» 0UtJ ) svr kJ /ijCljM!


AS AMENDED TOR PETROLEUM EXPLORATION AND AfcUuJj JjjV1 O6,


EXPLOITATION


UET'.VKICN t?r


AjjJlJl J~OU Ajj^sa


THKAfwn UEPuriuconiuvrr J


AND JjjldJ KijiAaSi Ajj jjl


'HIE EUYMTAN MiNEUAL IT.TllUI.ICI.IM COKI'UIU.TKJN


AND __ J


T11E GENERAL PETROLEUM COMPANY Jj>r“ i.U£ iSj-iil


AM) J


FGTZEO INVESTMENT AMI) PROJECT MANAGEMENT Ml*- ClijJMji B Jjij

- -* AM) J


GREYSTONE PETROLEUM (ICUVIN) UM'.'I Kl) ^ [*#*/) A5>l





AND J


PICO INTERNATIONA 1.PETROLEUM SERVICES PANAMAS.A. t dUjpjjy jijj Xi »


IN * «. * L ^ •» . "


SIlUKIIEtR. Oi-!.SHORE AREA


CVl.FO r.S'UKZ


SCALE I : lOQ.Oon A.R.K.





 Y.■ • 6 as^+i Y" • ) Y*\













JjjX*U Aal*JI Ajj^i\ AL:.jJl








Y • • o as, ltJj " " ^_5j .jstJI *---iil IJa ^Jl ftjL-iVlj


fL> JjuJi mr ii-j *u jiJj jjjUJI ijjUaJ! ^.IjxJYl


lik^» yj AJ^Ui-ij Jj^xJI JX v^JJ N V/A V ^ jjJUJI J 'i m IuJ *> Y1 A


•^.^.^) Am^xJI j*AA Aj_j^ $ n’~T U-.-^J A3j-A£ Ajj^»c_Ji j^JlS/


j (2w»l_»JI) Jj_,-fc-JU A ot acjI iSjJLilj (aJL_*$JI) JX>xJJ i---oLjJI ^ --->tl


f-J*^ J«r^ jXj! __j-^-y A$"( -L>j_Xj ) A.t.«-.J olxj^-ill Jjli! j oljL*Jtx*^VJ


^ Oj"’1 "di/*-) .iXo-J (c«^»ui) _r> a5^Sj 1 j) .Arl.y-J l^Jj .,.. _■ ^


ij-iio ^41® Ji* 'Jlx. 'JjLUr ^-y. j -bjjj JLc.





f J.ULI ..^r*





A«^ (J.ill ^.a .iL^i ^(b j J.Xa ■ j O Ujj-ii I 6j li| j OIj I a J ~' aSjZ* J


_j5L-j j Jj_*il \ ^ VT ii**J 1 o pSj jjJUL!l sjjl---ajl a---jLaJ)


CjLJUjI (ji .Ail.U^l wJLj


5_lJ Yfi j 'i ^AL ajl-J i-t . \ A \ auJ ^ 0 - fl---sjl uylj---iJI v-*>j-£ SjjL^aJI


A---jj LftJ I yj A«^l I £a (ib^-3 ^j/>J .XJ ,a, ..I ( uyu I) jyJjj ■'---'»' (j> A^"_/-ij \ ^ A ^


xwiuJnfl^ajjUJij alJ \ e. ^ ayUJf «->^5 ojUJI r(>Jvi


JjVaLI ^AjI I'il Via iSU- iji Aj) ^jLk^iaJI |Ju> *---o-_yX Aix AjI---OUj J_)VjteA3 tAXaLja5” JjjJ.1


IJa jLij I jbj-wJ ^yjLj ! A-y I 4.1 4j_X4 JlA^-


liUxJ A-JUI oL^lj-SJ^U J-J-l (j-aj-jl


ljS*«sitC A-5sj^aSH aj^txtl oU*lfjJI olj*lfj J jj-® ( 0 0.....) '-aJI AjU^oi-j


 r V • • o iLu-LJ* r- ^ (^b) Y3 .Jl





ANNEX "C-l"


THE GUARANTY


EGYPTIAN GENERAL PETROLEUM CORPORATION


Gentlemen,


Reference is*made to this Amendment issued by law No.--- of 2005


of the Concession Agreement issued by Law No. 65 of 1973 as amended


by Law No. 138 of 1974 and Law No. 7 of 1978 for Petroleum


Exploration and Exploitation in SHUKHEIR OFFSHORE AREA ,


GULF OF SUEZ by and between the ARAB REPUBLIC OF EGYPT


< A.R.E.), The EGYPTIAN GENERAL PETROLEUM CORPORATION


(EGPC) , The GENERAL PETROLEUM COMPANY (GPC), PETZED


INVESTMENT AND PROJECT MANAGEMENT LTD.(PETZED),


PICO INTERNATIONAL PETROLEUM SERVICES PANAMA S.A.


(PICO) and GREYSTONE PETROLEUM (EGYPT) LIMITED


(GREYSTONE) ("PETZED”, "PICO" and "GREYSTONE "


hereinafter referred to collectively as CONTRACTOR and individually


as "CONTRACTOR MEMBER").


PETZED INVESTMENT AND PROJECT MANAGEMENT


LTD.the partner with EGPC in the concession Agreements issued by


Law No. 65 of 1973 as amended and PICO INTERNATIONAL


PETROLEUM SERVICES PANAMA S.A. which is the partner with


EGPC in the Concession Agreements issued by law No. 150 of J981, law


No. 44 of 1984 and law No.25 of 1989 and GREYSTONE


PETROLEUM (EGYPT) LIMITED which is the partner with EGPC in


the Concession Agreement issued by law No. 150 of 1981,and Law No.


65 of 1973 as amended as Guarantors and on behalf of CONTRACTOR t


hereby undertake that , if CONTRACTOR spends during the period of


five (5) years from the Effective Date of this Amending Agreement


less tiLan the-minimum amount specified for such period of five


million and five hundred thousand U.S. Dollars ($5, 500, 000) under


this Amending Agreement (the difference being hereunder described as


"Shortfall"), EGPC shall notify PETZED , PICO and GREYSTONE as


CONTRACTOR and as Guarantor in writing by the amount of the


Shortfall. Within fifteen (15) days of receipt of said notice, PETZED ,


 r:. ^ (gU) n ^i - rt





jL-Jg»L *>^-*4^1 j*>5j cij---« ( "j^-rJI" ---^ U-^-3 ui-^jj) Ujs JjjtscJI jUj!


'j-i-c- J^A>. JU-JL XjIx5" j---*Lj j5Uj _j


0_j$w J j»>^* j^A^l U-& ^LU*( ^_a Lojj ( N 0 )


4-iai-J ^U-^-flJ 1 C~> j^a U^U” (j_^5sJ .U-4JI csJ[ Jj_^xJI

. _**!( IJu*


J^ri J j-* La---- j^Xj uiUS jLi J_J-S"-^I Jjj-X-JI Jo-^ *UU»


»^L>V LH_J? » |^4^° xJI jjJLc ,j------o I ^Uol jj---o jj-X-^u-il


jjiiJlj LfJi jLill u’JljiJI <^->>2 AJty<-i_i*Jj Jj_;xJf Z_iUj 1


ULi? ^1 c^sj j_j5"ill Jj_rxrJI JiJ ^Jo lJ!j_w j

. Jl_p.Sf! i_---> i i^uJI jic I4J £,U)I jJ^zJV! JLJlijI


<---1 jk- 1 j UJ lj jU>j UJ I 1.1* i>j ^ l-s j*^ I 0 * C-Jj (_£ I J j ULJJ jj^ij '


«


t---aJ 1 4jU.^u,..o.> j jujU A...m^..-> £_Uc Ui_ru£U> |»-Uj jl 1 jl_ft..V?JI IJU> ^4X0


y->*---*JI Ua jl o*il 3J---px_..r 1 i oL*^_jJl oljVji jj-o j*^'_jj (c 0 • • • • •)


e <


. &jj| ^xsCjj l-i* ^1!k>1 LjLaJj Jiiy ZJLU ^ »


( *\ ) jULm/ C LtfXjJjl J-Lp ^ .jgJJ jl-a-iaJI 3__«->1)U^


Ua JjJljlsJI i_jUjI jU^*^ ^jjIj (j-o Ij^j (_^Jl ol_^i---< (0) 3^zs ZjL^ ^4.^.1


^ 1-4^1-^ ajU»I_}aJIj ^jI -U JjLill jl **-^-fJI -i-U jSjj ^>iJI ^-ijUJI ^ jj


• l-U Jj-uJ! oU^i


ujl&j^iil SIjjI 5 wf^U^Lu^lJ id^u ^


................................. : l-41c.


A,mU.<>mJ (klu^ajl) [W$>U ^^.rAOUl^a,

 To Y • * 0







PICO and GREYSTONE, on behalf of CONTRACTOR shall pay and/


or transfer to EGPC a quantity of Petroleum sufficient in value to cover


the Shortfall.


*


In case said Petroleum shall be transferred ,it will be deducted from


the share of PETZED , PICO and GREYSTONE of Petroleum


production from the Development Leases related to each of them ,


pursuant to the terms of the Concession Agreement for Petroleum


Exploration and Exploitation issued by virtue of laws mentioned in


previous paragraph and said Petroleum shall be valued at the time of the


transfer to EGPC in accordance with the provisions of the concession


Agreement related to the Development Lease, as the case may be .


CONTRACTOR may at any time between the date hereof and


the date on which this Guaranty shall expire , submit a bank guaranty of


five million and five hundred thousands U.S. Dollars ($5, 500, 000) of


the Shortfall in a form satisfactory to EGPC , in which event the


provisions of this guaranty shall automatically lapse and be of no effect.


This Guaranty shall expire and become null and void on the date six


(6) months after the end of the period of five (5) years that starts from


the Effective Date of this Amending Agreement or on the date EGPC


confirms that CONTRACTOR fulfill its obligations hereunder.


Yours Faithfully,


PETZED INVESTMENT AND PROJECT MANAGEMENT LTD.


-V-,--............................


'•Ss


GREYSTONE PETROLEUM (EGYPT) LIMITED


By : .........................................


PICO INTERNATIONAL PETROLEUM SERVICES PANAMA S.A.





jjMi fciaii


JaVi(4j|aS))ia '


 ■'-;,■■■ V- w;








v< ;«l^M*^t-»L.’• ., .."


0jj»*")lj

>•


'v-V- SV i> V-\i; rV:.i'





trv^Av,‘j-': v,■ ryt\


-: WA^ jy.„ .l , & ,C ‘.,VU>,'' <•’ •. f \ .■


I •»- yuiO >


- *P< ..r- <« jmo/•• *;' * jh'i


. _ ■ ' ! ‘,'t^ij^ '. l' “'.'•


'/••1^"< •' •A’J Si'- ''-'-’. £\'o -, • 1


• '*(•►.. -lH," ,»••'. ., ‘ |























iCix fVL ;. .• !*- “ ■'


'KM--U-' ,;.W- i •’ :. • 1 - ' ’' i'f •'


4 *•** i)y'&h*.^itf.i,. r'> • -i ,*,.......


I * ' <5* i n ,


; \'»r * ..'teV (****>■ • :r;> j x, v' > .<*' V


c. i'.i' *•»•■ -J, v'.jfii'i ’ I' ’ ' f ; .;i*|U.I'i!.>7<


i’W-" ; tr'j V- ?*f5«**


-v-V- .. 11 , ^?.U; ^ Jew ^ dfjUJ-'U V-i! 'Jr' ?>*3?


■ >*

;,i:'.".'v>-^' "-vL^ w.. _ ' ' 1 • • |» - - •* j ^ i l * f» ' *. ► I \ * • % *





.■' '■■-'>>■'- ' (ybljijJ.') , ’ .»?*

j. t\^U^ (j---ill o^'j *3 S iiti S5j^ , YK;’ Tif^r ’





•■■■;/■' ... .; ; _ .{w&hux) 5» nv ,{•;._





. . ;; _ tjvy^^frvu?J~>j t


.^,..v . ; .: _





r "'>..(‘^ ^Hvr


• ‘ • 1 i ’ 1 " «• .;• •• .•;': .jt-^ >;.'











tsfe:v-


„ *• ♦*


V;^ .1- - : ■’1


V^^-!


 v.-'V. • V.,^ ^ ^


amendment


.TO' . JijiJl «JUiV................-.-j.





;"J*ETKOEEUM AGREEMENT ?; ' :'T"vr(. JC


J... f.; ; -BETWEEN r--


V '<'*£ - GOVERNMENT OF THE ARAB


f : c ^ OF EGYPT


; •. ■- •<_*» ..> ••• '


' ■$•••!• •••• AND -s' • ! '■


•S' ,-v -I. EGYPTIAN GENERAL PETROLEUM •» . . J as-^v >, /> ?r ■ i


•>. CORPORATION ’ •* -• t\ f '*.t .


•V & • . : AND * .• /' ■ a • s


. • TJiE^TRANSWORLD EGYPT COMPANIES'* \ 1 ‘mAjf- rsi li


:- v" life' AMENDMENT made and entered into on this day


K Ot>'.“r ^1978, to the Petroleum Agreement (herein re¬ 0*Ull AA~UV1 ^lr W '+Je


's ferred to as the “Original Agreement”) authorized by Law < |\vt U*i 34jUJ\> UV’f 1 1*


. ,No. 65 ol 1973 and effective August 28, 1973, by arid be* U-i t^Jc \ V^5- Ctt ^ 3


• tween the GOVERNMENT OF THE ARAB REPUBLIC


- ‘ fiF EGYPT (herein referred to as “GOVERNMENT”), L---^ '<>_•» ds-s-A LU1 SJ-dlj t ( a » J>m


•yptian GENERAL PETROLEUM CORPORA* )\©A

> TlON, a legal entity created by Law No. 167 of 1958, as J Vj*3 ( t

r amended, (heron referred to as 'EGPCT), and TRANS¬


IT ORLD PETROLEUM CORPORATION, a corpora* <^3. £(01 jSJ msj


• 'on organized and existing under the laws of the State of j *


«>claware,' U.SA., (herein referred to as “TRANSWO-


'v RLD PETROLEUM”)* as amended by an Amendment ___. -Or ^


^ Uufi yuon> < (•< jjVi u_»


v (herein referred to as the “First Amendment”), the Original


-i Agreement as amended by the First Amendment bring u4Jj_ < p._«_wW7l 9 u_* L-L ^llv } JjYl Ji_jjcU


I, (herein referred to as the “Agreement”), authorized by Law t/jUJI* UY£ I 4U (Sj 0*12' vrj*i *i OjVI


•v No. 138 of 1974 and effective' December 18, .1974 by and Ctt UjW JjS^S I^Yt »A o*





• between the GOVERNMENT^EGPC General Petroeiura

• Company, a Company affiliated to EGPC (herein referred


( to as ~GPC’\ as assignee a£ EGPC and TRANS¬ O* Jjudl -u_riA ( < <*UJI s [jt (jUu )


WORLD PETROLEUM by virtue of which First Amend* tsJh JjYl *no>---2jr ecu 4


. -.'ment TRANWORLD PETROLEUM assigned its inter- Ji 3-^JUrticti cJjUf


<. ests in the’ Agreement to TRANSWORLD EGYPT PET-


A>LEUM- CORPORATION (herein referred to as j7#0JjU-i UA* Jljj---J1 jl


^TRANS WORLD* EGYPT”), ST. JOE PETROLEUM cJl---- »*yl \Li I4J* ) Js'jX-^


EGYPT CORPORATION (herein referred to as “ST t ---»•.* IL^3 ( a -y>-





: -JOE”), CANCEL OIL (EGYPT) INC. (herein referred >.< I. t-lr> ) dij~^ f** iAr** *^As f tf Jji'J’ » c


; to as "GANDBL”) CITY PETROLEUM EGYPT LVj, j ■*-1£ASj-S> j c ( ff i)


..COMPANY (herein referred to as “CITY”), all corpora* is.*., oiyjIL jjj}Lj


.is and organized and existing under the laws of the State


. Delaware, U.S.A., and TRANSWORLD EGPC, ST W-> Ujh djlhjj ) uVj 1 s j*- •---<1---'j 5 J


JcE, CANDEL AND CITY (herein and in the Agreement ..vV?!** J U1>1 ( « 5 si>v» : in ' * • •• J cMjt. « i J»


referred to as the “TRANSWORLD EGYPT COMPA¬ • • »


NIES”), became parties.to die Agreement .


/ f





WITNESSETH >• - , ' "• jjb


' WHEREAS, the. parties hereto wish to modify and •L1U/Y1 J>Jw^ j~^s j ••Li vJl>V o' - j---





amend theAgreement to enable the CONTRACTOR 'J*. 1 u»'S3' jJilb

adequately to explore and develop the Area (such term,


an I other capitalized terms are used heron as defind in Ji.Ls*' . (iy vw


th< Agreement)’:


























y* *





i *• • :f ,c'


?* •...**•. * *.





 »WA is* Jfe iv g (£) Y





^ F- ... .. £ 3- _ _


• WHERES,- pursuanc'to' :Anicle 15 of Law Na -20 of tvft it-iT of* o'-'*


' 1376 which went into effect as of March 17, 2976, EGPC cJ> ir«


su new constituted, lias been subrogated to all.the rights u;--->$\ cj- o/du ^vur-


and obligations' of ' EGPC as it formerly ousted,’ and has


been substituted lor" the'said former EGPC in all agree-


. rnents and contracts concluded by the latter; and WHER¬ • <*ji\’A.


EAS, EGPC as nowconstituted has thereby replaced the


former EGPC as PARLY to the Concession Agreement; ti&b oJw Jj JlsJI ol


and '• . rtjsiyt vsW j


WHERES, in accordance with Article XVI (b) of die


or* ( ^ ) n »JllJ ftS»V UJ» Cl


Agreement, said Agreement may, be altered or amended oij »uSU4t dljVSl os JjL41 JUjVu JUUrVI utir J,'jU


by the mutual agreement of contracting parties and the 1J* li /il\ yU-**5U Ji-Uill VJU i‘ijf.) j


parties desire to make this Amendment for the reasons


hereinabove stated.. NOW THEREFORE, the parties he¬


reto agree that the Agreement shall be and is hereby amen¬ <*SU«VI Jj*j ,^1 jjL Ijiifl Jj ljjt. sjl


ded to the extend hereinafter set forth. ---' • uA -Ls'J|' XcJ1 Ua fc,.*.





1. AMENDMENT OF ARTICLE 1. ; i


t ' 1


•1.1.. Article I (a) of the Agreement is hereby amended to • (jIj 5-iUjyi ^ [ 1} m»iU) J-UJ _ ) _ l


' read as follows : JUal OlLUJI Jbi J~all V C$J rfisj./ H ii*J


' “Exploration” shall include but not be limited to such


geoloSical, geophysical, aerial and other surveys ant’ . JU7ij-0rfcJljj ouciii. x


the. drilling, plugging, deepening, completing, equipp¬ oiiiiij oijU^yt oixjii tjjiiii jo-jiUw.


ing and testing of such shot holes, core holes, stratig¬


raphic tests, holes for the discovery of petroleum or 3I Jjj2-;!' <-*I---iaS'l s>>Ut j&.3


the appraisal of petroleum discoveries and other relat¬ i iUJi; Sdtislt jttflj v^J5n ^ Ujj3 ealJLijJ


ed linles and wdls, and the purchase Or acquisition, I---( t+de j! OWllj oU^Ltj, OUlx


transport and storage such supplies,, materials and J* s' >1 tfl Jji ^j!i\ IJ*!


equipment therefore and/or any other work or acti¬


vities necessary therefore or ancillary thereto. The


verb “Explore” means the act of conducting explora¬ • >*-»ji a-Lmj ftjai ^ « 6u » j*ai^


tion.


*• |


1.2. Article 1 (b) of the Agreement is hereby amended to u** J-*^* *L5U»yt 10 M t --- \


read as follows: ---


“Development” shall include, but not be limited to,


alt the operations and activities under this Agreement otil-II y ^ , ^J1 p


with respect to : . • «ja j


.,(i) The drilling, plugging, deepening, completing 3 x_j _ (|J


nnH equipping of development wells, and 3 '( jOA


(ii). design, engineering, construction, Installation C>\x-A\ -iMXj .Liltj ^._1 -r" (T)


r • servicing and maintenance of equipment. lines,


systems, facilities, plants and related operations; { Ui i-MI oLUJtj


. producing and operating said wells ; taking, sav¬ O-h*-3 -X-h < ij/JUl j'.yi


ing,, treating handling, storing, flaring trans¬


porting and delivering petroleum repressuring ‘ ^---j JJljH JLJI\51^L-





recycling and other secondary recovery projects, J < iijfM


. and


(lil) Local transportation, storage and any other work ,1 j---i’f t^ij ou^L* >JI jiJi (T>





or activities necessary or ancillary to the activi¬ • ( T ) 3 ( n J ij/Jlt IL^VJ CjV /


ties specified m (i) and (ii).




















rjnv&’f


ikr- •■' 1 •> -■


 T


^. ’Atticle 1 (c) cftbe Agreement. Is hereby amended to' «? 5JUrtll0, ( .*. ) ^


• • *, ,• • i > ^ ,* k ,*’ v,,J *,/.*, b' j ' **! ' '' • 1 \' Jtn


"• . “Coniunercul Well” raeanathe first well on auy’geo- 4 (---S’ J j ji» Jjl '^IJS t .


''logical feature which,' after r testing for a mutually C r.f i>;o^ WJ* JUi^V fy ijS] Mi .


. .agrealapon period of not more than-thirty (30)-coo-


- secudve days, in accordance with sound and accepted jAa' Uij,


international industry production practices, and veri- Jiw fpl* W1 (MJy li-di «4UA. £Ju»dl


- fied by EGPCVis found to be capable of producing at


an average rate, of not less than three thousand j ( T* • • ) 4j3U o6 J* ^ ah .


. (I’ jDOO) barrels tit Crude Oil per day (BOPD).: The tSJJI ( 2j_,L»SJI jtjl » lJL‘.jl jiljlij


date of discovery of a “Commercial Well” is (he date


on 'which suchwcll is completed and tested accord* . . jjUji jin iju juyi o


ins to the above.


' -4. Article l (b.) of the Agreement is hereby atnendod to j-j*cJt iji ^ a_sujyi 1 r j \ »adi Jjuj t _ \ -


read as follows : --- jl -fc>-b 0*^-* * c*-»Lirfyi »


“Commercial Discovery” means one producing Crude


Oil reservoir or a srdup of such producing reservoirs O’-1*" a*, JjUill jj\ <^tl <.-*v.ll gMfll pm Xt-


which CONTRACTOR determines after appraisal, CAj!jUl>^ jtjieSt j IJka-f < IjjW if4--' ot '


is worthy obbeing developpcd commercially, taking


- into consideration the recoverable reserves, produc¬ •ijjJI jU_1j lywJl #U_* oy;i« .>>


tion, pipeline and terminal facilities required, estima¬ . iiMl Jf^ai ft^“


ted Crude Oil prices and all other relevant technical


*' and economic factors. CONTRACTOR shall im¬ oA Oi by tfjW’ oujuj-yi, jits-b Jjtai


mediately give notice erf-a Commercial Discovery to {fl ij+.'.-j vjt_tx5yi ul jji Ji JjUU


" EGFC after the discovery is determined by CONT-


... RACTOR to be worthy of commercial development. : jlJH1 *£Uj 3JL_». J 4 Ua


Such notice, in the case of such determination, shall yrfl Au ,1 t -tJW' *L‘ .4**11 ji


be given not later than die completion testing and


evaluation of the second exploration appraisal well, •

or twelve (12) months following the date of discovery


of any Commercial Well whichever is earlier. The I


date of Commercial Discovery shall he the date CON¬ l*bj J^UU jWJl ~jyi j


TRACTOR gives notice of same to EGPC. If no


Commercial Discovery is established within seven (7) 1 V ) ^ jyi- JU^1 fi, ,J lal . oLtrf-yi


' years from the Effective Date of the Original Agree¬ • Ukll JJ- ,J_; tLll <-iUryJ gjjb c-


ment the whole area shall be surrendered to the


Government I ^ ,1^, <_JUi.-yi ^(o)) »jt-ll JiJUf a \


l’.5. Article 1 (n) of the Agreement is hereby amended to


read as follows : --- : JU1


“OPERATOR”, “CONTRACTOR” and "TRANS ,JM « jUjj_il y » j s JjSll » $ * °LL*U; ,^1 s


WORLD” mean and include the TRANSWORLD (►♦JI JjLdb O^UI \j

EGYPT COMPANIES and each of them and their


respective successors and assigns in accordance with w V j -113 c

Artidc XVIII of the Original Agreement and JLmj b


Section 7 of the First Amendment. J cA*


From and after the date of Commercial Discovery :


(a) the word “TRANSWORLD” in Articles X (a), H c ( V) 1* M I ) I* -»bH J » Jtjj-iy » <*!T


X (b), XI (a) and XIV-shall mean TRANSWO¬ . -‘■jj---'V J (*)


RLD and OSOCO. \ (lMt(,)c aljll J t c-l_^L*lb f513! » (y)


(b) the word "OPERATOR*’ in Article V (f), IX (a),


IX (b), IX ->i J-j «n IV * (!>.U ‘ W ' < M


OSOCO.


 * the-wool "OPERATOR”/mArBdcs VI. (b)»XU(c),


XV (b) XVI (a),XVl (c»iaxxm (a)(1) sMI'mem


'CRANSWORLD andOsOCO.





(d) the word "OPERATOR* m Articles VI ^),'XlV,


• XV (%) (1), XV (a) (2), XXIII (a) -first line and


, XXIH (a) (2) shaD .mean;TRANSWORLD or


I •'osoco. - ;* v





■ (e) the word "OPERATOR" in Article XIl (a)


and XII (b) shall mean TRANSWORLD and/or


: .OSOCO.• . ...





. ' ■


2,Amendment of Article III ^ : asm jf-w - v





2.1. - Article III (b) of the Agreement is hereby amended • cyTT ^ y jAJ ,) _ T


to read as follows :---


- Aii initial exploration period of four (4) years shall ' ** '*&***- ( t i gyl l«7^ Sljl C-u IV


start from the Effective Date of the Original Agree¬ J~-

ment.


7 TRANSWORLD shall have the 'right and option to { y, J UVj}1 ,^J1


. extend the exploration period for up to a maximum


of three (3) additional years by the drilling of addi¬ ^ ( Jjyi IjXi ) Sjtt


tional Welk


TRANSWORLD may exercise its option to extend


the exploration period for an initial additional one ^ j' J t Jj» JLitt ) JLaft.A jt, d >Ji oLUc <.w


1 year period (“First Extension Perifxl") by commenc¬ tJjft Sjzi J3U. ^

ing drilling operations on an exploration well ("First


adilitional Well”) on or before August 27, 1977, and -*v If*..-.'.. 1 Lyjt ^ JiVL »A*


in such event shall expend during such First Extens¬


ion Period a minimum of U.S.$ 4,000,000-• . ^Vl irfa4tol>Hjil


• \ ; i


In the event the First Additional Wei! is a Commercial c ^jV 'ji* JjVt juiy; Lit u gji*. jl,


Well then within ninety (90) days after testing and


evaluation thereof has been completed, TRANS- ****. f<** ** W- ( v , C6*-J J3IA IV


WORLD shall commence drilling operations on an-


ocploratrory appraisal well ('Second Additional; .( ^ jUiV) jSJl) u_i- ^ ^ c/^ ^ ^


weir).


In the event the First Additional Well is not a Corns ‘ WUr y, JjVT ^ ^ b, u ^ ^





mcrdal Well, TRANSWORLD may at its option drill ^J| , ^ ^ j jl^J1


another exploratory well (“Second Additional Well”,


prodded drilling operations therefore as conuiuiccd * - TV jl J jLJi cU« Uj> 6t ( ^lili


on or before Artist 27, 1978. The commencement


I ot drilling operations of the Second Additional well jU* ^ CU« ,0. ^u, UyA


shall be deemed to be the exercise by TRANS- jl-^1 (), fU *4 A.JI at J ^


WORLD of its option to extend the exploration


period by a second additional one (l) ycar period ^ U-'WI 5j5J » J et* .


("Second Extension Period”), ancl in such event


TRANSWORLD shall expend during such Second °* (......& y »•*-* 5jsi


Extension period a minimum of U.S. $ 4,000,000


TRANSWORLD may further elect to extend the b/y • oUYjH cijVjj


Exploration Period for a thud additional period *VH( f 41 ^


“Third Extension Period*) by commendngarother


well (Third Additional Well”) on or before August


 !>&'£


tiohqpeqgtipQS on the Third Additional Well unless e*“jj IA») ci»-J bjjj ‘ ^y^ sV: •


ou u\ ^ A_ayft j~n oy**


on or befwesuch^ate TTRANSW??-LD, shall comm¬ 1 >-T ^ j CU** aU jl £,jfcJI \«Ui 4 jSj ‘yqty


ence drifting qpaiatitins well (“FourthAd-


ditiooal W<5l’),.in which case the Third Extensaon Per¬ *Ji jj ( a s.a


iod shallbe for a fulionc yar^and -TRANS WORLD e“. j-* iiun AUaYI >yi J1U- ^jia, *Uf


shalf opend dliring dic 'nurd* Extension Period a • »ia«df OVfjH OljVjJ ^ j'Jji t ____:


minimum of;U^. $ 4,000,00pv i.





' If TKANSWORLD should spend more than die A»lin u->jlWl JsJI ^ Jj j, UL. y c-ibl tjtj


minimum amount' required to 'be expended during ^ Lll i^bYl -*^1 y pj*»J »jb jJl £>U < 5yj


any Extension Period, the excess may be subtracted


from die minimum amount of money required to be J1JUJL.VI CAj^i jf iyi *1 jyi. *j\Ju\ jJjj_Jly y Vjlktl


expended by TRANS WORLD during any succeed¬ yy*7$i jSilt oti < J1 j»-^l u-- t

ing Extension Period or Period*, as the. ease may be,


provided however, that this paragraph shall not re¬ • JioJ4 fljdl y


lieve TRANSWORLD of any doping obligations.


. . :

&. AMENDMENT OF ARTICLE V





5. Article V (a) of the Agreement is hereby amended to • IyS C--9»J <_5UjV1 y ( i ) ( o ) 5jll


: ret d as follows;--- : ..aju^ji ruji (I)


(a) Cast Recovery Crude OU





(I) CONTRACTOR shall recover all costs and ex¬ IjJtf woJt&Ji iilf JjUtt -j? --• (\j


penses approved by EGPC as stipulated in para¬ JLiUryi^ i 5jU1 y (j)j(j) J

graphs (i) and (g) of Article IV above, as descri¬ n^. < L---* l y J> Us


bed below in respect of all Exploration, Develop- J (f.) -Lt-L 3-Jlijyi »-b- vf-j*-; olrt,«llj


ment and related operations under this Agree¬ <; <3d1 y fUJl C^jJl y JJUl


ment by taking forty (40) percent of all Crude


Oil produced and saved from the Area and not • LjfeJI 4b oU*e 4


used In Petroleum operations and before payment ab*-yp 1 fun 9 Ji uj fun c^jii u*


of Government royalty by EGPC. Such Crude . t ajtstn


Oil is hereafter referred to as "Cost Recovery


Crode Oil”. t_,-_ -^-1' fUJt C-jll y CMjj^s aOJt jy_tj


Such costs and expenses shall be recovered


from Cost Recovery Crude Oil in the following : SjW ojhlb OJtsifl aby^i


manner :---





(i) Operating Expenses shall be recoverable in 1--^'

the Tax. Year ia wiueb. sud. costs and espoor . cAubSt£il\ »JU bJ


scs are inaHrerf and paid. • ' *jl> J-5 *_jil oliiJ' J> Uj. otiii (T)


(ii) Exploration Expenditures, including those


accumulated prior to the commencement


of initial commercial production shall be re¬ J* ^_n j w\ j (T.) ij.A* Jjtfjusn


coverable at the rate of twenty (20) percent yiit j-oji <1---11 y u^ji • ».*---■'


per annum based on amortization at that


rate starting in the later of the Tax Year in us3' ‘ . -jXIl 5j_J1 al ot.Ifcll L_»J


which such Expenditures are incurred and


paid or the Tax Year in winch fnitital com¬ . ^o/J Ur-1n d ‘


mercial production commences.


 *Ln j «ur ;j (U)


;! (Ui) Development E^Kodltuiesi including .those.


•!;.!;. r^'^accuiHt&t^jijnQrtD'it^’eoante^Eatfnil^f


v.*.. .‘initial fcSrnriiercial procfocition; shall here-1 &_11 W'l^' 4 J-t-Il l-Ui bhUiJl &L-1


covcraWe at the rate of ten (10) percent per


annum based on amortization at that rate 4J IjJ Uidt *i* c-vlj c4*^


starting in the later of the Tax Year in


which such-expenditures'arc incurred and i£ui» ljt> X2»*y CO*-'-"'" tS' j 1^UiYl


paid or the Tax Year in which initial com¬ cH-Zidl jl cAijy-alt dJfcll cJtf o' TiJ* ii


mercial production commences- CO * -l v? UjIijU-1


To die extent that in a calendar quarter, costs, ex¬


penses, or expenditures recoverable per. paragraphs (»}, I . • .


(ii) and (Si) pfeceediog’exceed the value "of aU Cost j uyifcji A>ji-.y fiMi ^ jn jf o*

Recovery Crude Oil for such quarter, the value of the )\i,r~*V ua ^ j" a*» .4 *~r gjjll «ittj





Cost Recovery Crude Oil Anil be allocated m accor- : fifed UJ» £Jy


dancc with the following order of priority :


A) Operating Expenses, oUju ({)


B) .Carry-forwards, if any, ns prorated in the period a j---silt j J-Ull cr---^i { 4 SU-jU £IUl1 (<->)


from which such carryforward arise.?.,





C) Exploration Expenditures, .J! Oliaj {•&•) . x


D) Development Expenditures, . Otiil ( i J


and the excess shall be carried forward for recovery J\ SJbil ii-ill £t>jf jl JJj J Vi


in the next succeeding quarter or quarters until fully


reoovered but not after the termination of this Agree¬ ,«L>Ujyi J-» it ij'---’iy i » 4 4*^^, iJ:---3 cX.





ment jl_jl J UjLllSjJl /*itSU Uly ...adl -Ci-Si yi


For the purpose of determining the classification


of all costs, expenses and expenditures for their rc- /: *jui iwb


ewery &e following terms shall apply :


].. ’'exploration Expenditures” shall mean all costs CAj 3r^S uijltS; * >1^1' cAii >_1


anti expenses for exploration operations. ♦ «i^Jl


L


2. “Development Expenditures” shall mean all costs cA-J-n/oU}j~**3 vjSJa o\a*3 » f


and expenses for development operations with die I l . V JJLtdl uvjL>.. i


exception of “Operating Expenses”. i





0 CA_» * --- T


3. "Operating Expenses” shall mean all costs, expai-


scs and expenditures made after initial commercial vi Jt_feH u*3 4 «JjYI ^Ujyi Jiu C-“il Jjlll


production, which costs, expenses and expenditu¬ . Ole 5J.131 oVeedl) OOj^aft^^


res are not normally- depreciable.'


TRASWORLD shall take each quarter of a year, fUAU •J*’ 4 <»• JJjj---■*/


all Cast Recovery Crude Oil produced, plus its share oi^ll iji t AaICJi ji-~*H ,


of the balance of Crude OH produced as stipulated in


Paragraph (b) of this Article V ancl shall pay to EGPC (O)®jiil' j *---!#• jk U J* (jiLd' fUdl '•


within sixty (60) days from the end of each quarter in i-ji p\.) iet---• (J 4*;»ll »jU1 *X*


cash and in TJ.S. Dollars the difference between the 4 A_Sj j Viii

value of die Cost Recovery Crude OH received and


the cost to be recovered for the quarter, pursuant to A----it- itsji-.'f Cj jll i-J ip


the foregoing provisions. However, with respect to : . iiUJV fU*!U 1213 c 3L-JI ^ iilCdl,


such excess Cost Recovery Crude Oil, EGPC shall be


entitled to elect each quarter, with three (3) months'

notice in advance, to take delivery of a quantity up to ( fjj Jf jltir O' c jlu^---‘1


fifty (50) percent thereof in kind and thereby reduce «j" J---■*** “S*®" -ikt? o' 4 jjt-A (V) ifyo ® jibii


the amount which TRANSWORLD shall pay to ^JJ.1 Uk ^ IS® j lo’.> ce---*s-


EGPC to the extent of the value of such excess Cost l---oU> 2*_S!t jlJiw ^L+ll UJ| y 4-1X tf-Ut


Recovery Crude OH so taken by EGPC. a'ajX-V Ml |A5J\ cv jll ^ ^UJl <4*11 -























i.





f.


 f.---. • • s* «fc*





All Castsi expenses ami tatpaMfiturts'shall onlybu


dude cxpencKturcs incurred and paid in the'exccutioo (jla us!) ji X-- -*j' yj oLUdl J ttuUllj cl*> (jji


of operations and shall not include interest on invest* : -»-•* ---,71'





3.2. Article V (b)of the -Agreement is hereby amended to io* M • M*4*J - t - t


'treada* follows:-t-


(l») Of die remaining sixty (60) percent of Crude Chi, tl ( A-y© ) £j*Uf f t ••'*}


EGPC shall be entitled to mid receive eighty ftejy

and one half (80.5) percent and TRANSWORLD /+ •


‘Aa+tJ ft'ls.Tf Jatti Sfl '


shall be entitled to tala: and receive nineteen and "i"Vl : '





one half (19.3) percent. TRANSWORLD shall J c^gjlUJI (| 4J*


have the right to retain abroad all funds acquired


; by it abroad including the proceeds from, the sale •jiiB UJ» jjlall f’JJt CJjJl £-»

of Crude Oil exported by It in accordance with ■^T^Ui oi*


Paragraph (d) of this Article:





AMENDMENT OF ARTICLE XV to bUi Jiju; _ (








\ : tjit iSmiw ijwA & ( t x 1) \o SjOi da-?


Article XV (a) (2) of the Agreement is hereby amended


to read as follows : ---


A minimum of thirty five (35%) percent of the com¬ ( To ) Ct'lbj 3---qd il" V L giu,


bined salaries and wages of the expatriates admini¬ C&AaVI (f»

strative, professional and technical personnel employ¬ . ^4j1 iT~rt**j


ed by Operator shall be paid in Egyptian currency-


• (A bbj J>J»f . o


5; Amendment of Article XVIU





: -i/jff \js sjunfi & (i i u S-aUi Jjw i _ 0


5:1: Article XVIII (a) of the Agreement Is hereby amend¬


t


ed to read as follows i---


3> ^ jjuii* jt *4«>i ^ isi v (t)





(a) Neither EGPC nor CONTRACTOR may assign if 4 A-Jlbyi *JU J U jb Cwt1 i *- • ji jf V


to a person, firm or corporation not a party


hereto, in whole or in ipart, any of its rights, j1 jl ;^T *j J---«> j) yiaj. _|f


privileges, duties or obligations tndcr this Agree¬ ii< ^JUiyt »J._fc SjyJl obljdl


ment without the written consent of the GOV¬


ERNMENT. Notwithstanding the other provis¬ ,j» jltlV y«y « Lj£k)t &• 3^1^31


ions hereof either EGPC or CONTRACTOR o* f y Jjtat f ^ of* «# Viwi u* j


(or anv of the Companies comprising CONTRA¬ J Li-


CTOR) shall have the right to assign its rights, •La y>j>{ Ait. ;vljj _*-*j

privileges, duties and obligations under tills


Agreement to an affiliated company provided Oj& ol yii A^juyj


that in alt cases the assignee shall be as qualifi¬ *>•-31 ^ JJ* J Jjbdt ^ --- aJ! .


ed ag the assignor with respect to h technical ••«*» JU^* . VL4‘j Jtsiitl


and financial competence . Any assignment u*j% f *^1 j1 V O'


made pursuant to the provisions of this Article


shall be free of any transfer or related taxes, » We -VjJ ^ vljblJI yU


charges or fees.

















.4


%. ADDITION OF ARTICLE JXXVTI' =;•> n!) >. ;r- ■ ■ '.' ^


• ~7 ’ - LuUJl SjLJI »ju-w- AjUii, U_J Ja«;


The Agreement Is hereby amended to add a new; arti¬


cle XXVII to read as follows : ---


■ ARTICLE XXVII..


i tY SjUII


PRODUCTION BONUS . i ^


27.1' CONTRACTOR shall pay to EGPC the sum of One . £>j± gU -JjUH - 1 - tV


Million (1,000,000) U.S.' Dollars as -a Production A-Sj^vi obVjii cjUXj-s ;


Bonus when total average daily production reaches •j* JjT *L-*jS* G -W-*


for the first time the rate of fifty thousand (50,000) 3j1 ( e. . • • ) <---ill i»M*l1


barrels per day for a period of sixty (60) consecutive , ij'-r-* rx < v i


producing days.


>


27.2 CONTRACTOR shall also pay to EGPC the sum < Y......) Uj-U gU Lad Jjt-SU I _ TV


of two million (2,000,000) U.S.-Dollars as a Produc¬ * sjadi oLjVjiioijVp


tion Bonus when total average daily production rea¬ JjN


ches for die first time the rate of one hundred thous¬ •J---l L>>* Jr*j{ ( t. * • - • ) '-*11 «JL J-»---*1 »j_


and (100,000) barrels per day for a period of sixty


(60) consecutive producing days. • *---s)2*1 f a ( V 1 err-1 ^


27..1 CONTRACTOR slmll also pay to EGPC the sum tr......> oe»iU gL* usji j^uh gi-*i1 - r - YY


of three million (3,000,000) U-S- Dollars as a Produc¬ 4_Tia.'.>5* jtt


tion Bonus when total average daily production rea¬ JjV Ufji


dies for the first time the rate of one hundred and V*j! J?*^ ( l*. * • » ) <-*)!

fifty thousand (150,000) barrels per day for a period


of sixty (60) consecutive producing days. - *---jrtid fj* ( ) C5----' t5-t»


27.4 The aforesaid Production Bonuses shall neither be 9\ *5,1-|l EL3-yi MiJjUJJ V _ t _ YV





recovered nor amortized by CONTRACTOR. . .-i ~





7. .dmendmeni of Accounting Procedure-Annex “IT’ oj , J4rf - V


the Original Agreement 1-LaVl S-jLi'Vl ^ J B ^


7.1. Paragraph 2 (b) of Article 1 of Ajrnex “D” of the


Original Agreement is hereby amended to read as ^ tt J, D (ilsdl ^ \ Sauit ^ (ij)Y «>*J1 Jo-jiT - 1 - V


follows :--- : 1 \ji :uurti


(b) Operator's cost of holiday, vacation, sickness, ! fbl J»l_a* j CA_J*jJVi jjbjill V*


disability benefits, living and housing costs and [ J---00 JXjJ! y


.allowances, travel time, bonuses and other cusro- \ oX»*Vlj


mary allowances applicable to the salaries and 3. .!»■■ jll} u^K U .<1 i$j>- i^JY oIJlJI 0» CUi,


wages chargeable under subparagraph 2 (a) cf


this Article. Costs under this sub-paragraph 2 iJji^ll S^«a)1 »Jj» . «atU ll ^ Yl


(b) shall be 35y0 of the amount of salaries and «u» a l T« 1 3-^4. V-^. O^W-Y)


wages chargeable under subparagraph 2 (a) of 5ji«JI tSJ> OkJjb g|U«


this Article for TRANSWORLD expatriate emj>' yilijU ^-db iiLJ' »J-» .y. l I - I )


loyces, and on a basis similar to that prevailing jdi <------iS'o L-l S ■---


in oil companies operating in the A.R.E. for na¬ JjI------1\ J3W* yrfL,jI (jb OjS^i *E.'f'£


tional employees. ’S-'T'E J


 “It-





VI. Paragraph 3 ofArticle 1 of Annex "D” of the Original


*i » 3*111 5iL_il & ,f J U-*i -


Agreement is hereby amended to read as follows : --- : 'yflu* ijW CUvi





(3) Employees Benefits


•*.**'** v * CC-UU SJUI JLJL, JL-liJI OtU-U. ^IS]1 UJix<


Operator's cost of established plans for employee*


group life insurance, hospitalization, pension, retire¬ < Cl.i,t:,,lb £>L_^1j'1^L.UJ1 Jr


ment, stock purchase, thrift and other costs, allowan¬ < JU-iaVlj i ^Vl U*UJI,j' < ic-Lsl-il;


ces and benefits of a like nature, costs under this para¬ 013 Ujlt, ctfjJLIt, i J-'i)


graph 3 .shall be of the amount of salaries and X SjSilt »X*J j wilJVSiMf i


wages chargeable under sub-paragraph 2 (a) of this -Ojj---;|y y jy.fj CjLSy

Article for TRANSWORLD expatriate employees, f*!T Vj»»h 5j**lb j* '-* j--->*J. ijd*


and on a baas similar Co that prevailing in oh com¬ tr*l---.HI t^wl Jr Ojfcf i. ®Jt_U_oX* q» .


panies operating in the A.RJSrfoc national employees. • CfXAsH «---.-JU *£*f*S J jJUJI


8. Antendmenf of First Amendment J>V1 J.4-?


The thud, fourth, fifth and sixth paragraphs of Section <*----*h cr* *---'^1---1'^ * .'^,11 j


7 of the First Amendment set out below are hereby


deleted.





Each of the Transworld Egypt Companies hereby U-* v»v*i Jijj-Zs Cr* *j* Cf


irrevocably appoints St. Joe Petroleum Egypt Corpora¬ -C“ n" ( J?• CJL. JiiL Uie j««J ) JjjiJJ J** «---■


! tion (herein referred to as "St. Joe") as its agent and J---^ V »ut» J>L


I attorney-in-fact with full power and authority to ex¬


'1 ercise all of its rights and privileges and to represent UdjUi-lj I4* jo- j





all of its interest in the Agreement, including, without 1 Js?--- J3j 3W---i. ^Uryi j U-* -


limitation, the power to execute all instruments and 15>V1 JUYt ^ A-.jU-j Ob:;, ,.n ft


take all other action in its name and on its behalf in


connection with the Agreement; and each such Com¬ eJ“* t Vjs. i? sajj j^i, *ju,-vb




pany hereby ratifies and confirms all that St. Joe may ^ *iV jt ^-a l. jr 104, jfp, -


do on its behalf as such agent and attorney-in-fact. • ^ tjjfl-* J/ja ^.3


JLach of the Transworid Egypt Companies agrees to Ji-di Cte«r uU ^ Jijj-5V otr^i ^ 7S.t jr


appoint the general manager and the deputy tscnctal


manager of St. Joe as its general manager and deputy u^-u vV> rui tv-ur s> cJu aTjJJ rUii j,ji\ uJ^s fi


general manager, respectively, and agrees to maintain f *e.T‘C ) J w i-dCw JiUto-yt Jr. Jiiyj Jljdl Jc fl


an office in the A.R.E. The Government and EGPC uv;J-1*-> j? f 1+l.u- j^a 0i ^^ ^


shall be entitled to deal exclusively with St. Joe and


its general manager and deputy general manager in j>*Vi U---j ^ i &n j,jii


connection with all matters affecting the Transworid Cf* 1? CAf fill »J* iffj ,1 jJjy---l\j olf_


Egypt Companies or any of them and each of the ^ r^’ _-•>!» dJi ,i y.. «iJU- js u jsi jjJ3---;>


Transworid Egypt Companies shall be bound liy all


chat St- Joe or such general manager or deputy ge¬ - it-* fUJI ji-


i neral manager may do on its behalf. From and after Jiil j-^a. 4Ui l-U ^jL- \X^A


the effective date of this Amendment the terms


"Transworid”, “Operator” and “Contractor'’ where f < JjUII » 9 « oLUJU o } c


used m the Agreement, as amended hereby, shah V. J----ij

deemed to include the Transworid Efiypt Companies.





9. Amendment o/ Article tV (e) • l-“) ( "Jill Jj-Aat ---


Article IV (c) of the Agreement is hereby amended to


read as follows : --- - (jiyir Ijir C--.-W Ur>” ^ (_*) ( Sjltl


(c) (1) Operator shall be responsible for the prepara¬


-i tion and execution of the Work Program 4 J^1 i-iu-j jIoa! ^ vy--- J,Uli 0_,C _ I f»


which shall be implemented in a work-manlike C*

manner and consistent with good oil industry-


practices. •*’ JJ" ' J Jj jiJl Aeti-O j I.J tl


TRANSWORLD shall entrust the manage¬


ment of Operations in A.R.E. to its technically • flJl on j OULJ1 SjbO


competence general manager.


yff- “T~ '


peratipns Affer CommereiaJ pucouery i





(2) Upon Commercial Discovery, EGPC and CON'


TRACTOR shall form in the A.RJL an operat


ing company which shall be called OFFSHORE


SHUKHEIR OIL. COMPANY, hereinafter re¬


ferred to as "OSOCO” or as "Operating Com¬


pany”-' “OSOCO”., shall be a non profit, E?yp-


. tian Corporation of the private sector and shall


be subject to the laws and regulations in force in


the A.R-E. to the extent that such laws and re¬ ' c- ctstjai.j. 4J


gulations are not inconsistent with the provirions


of this Agreement or the Charter of “OSOCO”; c

however, 'OSOCO" shall, for die purposes of this


Agreement, be exempted from the following laws v* ^ I a^LL-yi


and regulations as now or hereafter amended or ’ d'J J1 o?V Cr- JwLj 5L&- -U LjUN


substituted :





Law: No. 80 of 1947 on Exchange Control oidt tjLsLUjJl ^---1 A-, ---


and its executive regulations, as amended; . SjJUdi *1 *)-U' t








Law No. 26 of 1954 on Companies as amen¬ ►isji

ded; . -il SiJuto cylj^b 3 4





Law No. 141 of 1963 on Representation of


Employees and Workers on the Boards of Jjbyi y-Ju- jLi j mr JtL-J in fij jojiti»


Companies. Jm«7 ^ La ‘S3 CtMfjll j -“'I -.---»J Olf^





< S*UJ1 o_jiU _,lu_eb 1\yi V -


Law No. 60 of 1971 on Public Institutions, as


amended; . *J AlJjl ccAj&3





- Law No. 61 of 1971 on the Staff Regulations CrLbJl 1AYI <..J *11 p*j _


of PublicCompanies, as amended; . -o sluii cty^b 4 run


H





• Law No. 97 of 1976 organising dealinRs in nvn \v oj«un


foreign currencies ;








Presidential Decree No. 1868 of 1974 restrict¬ i\y* < 1A1A -Ay-


ing some Contracts of Works of the Govern¬ y} ol


ment to Public Institutions-and Corporations . fL_Jl £U«I1


and Public Sector Units.








j S-JUiYl oLji Jjy'a V


(3) The charter of “OSOCO” is hereto attached as





Annex “E”. Within thirty (30) days after the I. Jic, b-jj IT♦)


date of Commercial Discovery, rite Charter-shall wri '. “" - !--r; “■


take effect and "OSOCO” shall automatically.: So-L*. Oi> t-SUb 3Li


come Into existence, without any further pn>


cedures required.


 -iai- (&*£


thcdMe “OSOCCT comes »rVV^£c^^&H0'


into enstcooc uTaccordancc with Paragraph (.t) e-U/ JU»U Vj^ ( *5Ul (y>


above, ic shall'prepare a DevebomeM^Worik


Prqgranrahd Bwfet for ifintmaSScKSf jlw .'***• j> < JLjuryt i+j ji*! ^ , Lai


yearln ;fv1^;:-rtie^X3ocninerdal^:K»c .?; ■;-.■■!: • • '


made,' andHicit 1atd^\h^tEc fifteenth (15th) of e> tfly «---» ^ 4^1.^ ^ujt jfU^ji


<3ctober of j5i(i yw?(cr‘su^M)tber date as*may


be anted .gpoo) asd therJi{t«enth ,.©f $ Cf j>jX* 0*^0)^ ^lUJI UJ Jli-Vl f* >T


Octob^ of^atiryoir thcraftetv roSOCO” g*Uj>a gUl JjAf- « # av cUi A11


shall prepare.an annual -J*rod action; Schedule,


Work Progezm and Budget lor the Succeeding <,~-M J4-^' {stsflu j^a*. fA*a. ajut juji


. year.; The Production Schedule, Work Program


and Budget shall be submitted to the Board of • jJJ Sjljjl


Directors for Approval.





. ■ ■ 1 . 1 ■


(5) Not later than the twentieth. (20) day of each 11 •- oj./~-»h fjJ\ V « j?9 fjls _ e


month “OSOCO" shall furnish CONTRAC¬ Jjtai J1 •---ijiSl- j>Jii fjjjui Jf y


TOR a written estimate of its total cash requirc-


• meats for expenditure for the first half and the J**---^ Or* ijlitr ui-aJlj Jj¥! t-t-aJI j “iJtid i,AtJ)


second half of the succeeding month expressed iu ti -ia-ii Ljl fjj- i £jJj»Vt OtiKjIl JljJl


U-S. Dollars, having regard to the approved,


budget. ■' Such estimate shall take into conside-' jhaWI oL-j- J JJ-js cjj *A*i»U Uj*~:


> ration any cash expected to be on hand at month’s SjiiJlj jlLU jMAT_. . Xil+i j UijJ UjUl jSJ


end. Payment for the appropriate period of such \ ) SjSaH J j/on j-yi Jt-i jy ^ ;^bji


month shall be made to the correspondent bank


designated in. Paragraph (6) below on the first 'J& lMj ( ^.1* jA* dj’fl f jJt £ Ctlij


(1st) day and fifteenth (I5th) day respectively, or rji j f-| {j cili t oft." |^> ?S Jli \ i---tl f jJl


the next following htwmcsr day, if such day it not-


a business day. , *J, iSOlt





(6) . 'OSOCO is autliorized to keep at its Otvn dis¬ j C^i -bi.-.Tej O'* * J?





posal abroad in an account opened with a jjuu iyi;IU ,jr ~ali jL>yt <±..11


correspondent bank rtf the National Bazik of


Egypt, Cairo, the foreign funds adavanccd bv . y-iftn J&Rl JjUlt VAl ySjt


CONTRACTOR.


U*


AHj gJUult ^ J) lyt Ut* qs ■ " Q&)


Withdrawals from said account shall be used.for


payment for goods and services acquired abroad J' gJUl Jf^xl j? t SJUJl J UJ* (J^l p. ^


and for transferring to a local Egyptian Bank ill


- the AdtE. the required amounts to meet expen¬ t 4 c/ii; ) j iSs** ul»fc*


ditures, in Egyptian Pounds, ft* “OSOCO” in cha*^' (A»> *J* J UJfi u*oLij


connection with its activities Under this Agree¬


ment and the conversion shall be made at the Wl (f-lLCiyill J5l>- jj ( i3 ** (j*---< jh^«---Jtj


official rate of exchange-


Within thirty (30) days after the end of each Oik!---, ,J\ (t /j^af 11 foi- i 5_JL> iu- Jf il+J


Financial Year, “OSOCO” shall submit to the ^ <~lc U x-oa UL, ( «^ • f«5 ) j ■UoUJl AUt


appropriate exchange control authorities in the


A.R.B. a statement, duly; certified by a recogniz¬ voiii oitjtn ^juji j sj^ai OUJ <_■ ClbL-»-


ed firm of auditors, showing the funds credited


-to that account, the disbursements made out of , luJl S-ljl J 0^-41 AX» Uysadt


■ that account and the balance outstanding at the


end of'the year.


 1WA jA«» JV ij (rr)' V M*d' --- \XVi.


■ . . W:. , | 'Ijfl. • l\Trfr


- ■■<»«■< >»•* - --- A."


The Charter of OFFSHORE'SHUKHEIR OIL


COMPANY is hereby incorporated as Annex


*J» -d 6jS*?-i-s.urj\ ^ {J>) j,Jll ojSJ


“E” to tltc Agreement and shall be considered


ns having equal force and effect with the provis¬ • U41 itJiu j/ w


ions of the Agreement as amended hereby.





10. Effective Date of Amendment » •• !•


This Amendment shall not be effective or binding J.u^n li* -IjW cr* rfV rjl» ,1 UU


upon any of tltc parties hereto unless a law authoriz¬ -_J -II j+A J JjiZ >U» fi b


ing the Minister of Industry, Petroleum and Mining Ju^Mda djjaJIj iu-jj


to sign said Amendment and giving of the Agreement, c.yun °ji id_* ^ty^jLMU «jurfl J**>i


as amended hereby, full force and effect of law not¬ UiU> tfl & ybsll J.WI ,y_fVij


withstanding any countervailing governmental enact' 1 * ’ • <


molt, is issued and published in the Official Journal ji*udiid*> aj.w 4_»u?yi JU'j---:.---. jhij-- •


of the A.R.E. Except to the extent amended hereby,


all of the terms and conditions of the Agreement as U_* U:- J-W .Ui:_b ; jJVIj »j3l J-C tv


heretofore amended, shall remain in foce and effect • JjJUuJl Id* J;


This Amendment to the Original Agreement, as aj4di-; a-uvi j*ai j,.udi id«i


amended by the First Amendment, shall be in force


and (effect as a continuation atui extension thereof ljt^i M-Vi *yij 5j3i j^ir


from and after August 27, 1977. . -u, U-»j lwv’y-fc---il TV®


IN WITNESS WHEREOF, this Amendment to the


Agreement has been duly signed by tint respective -• tr c-j~‘ r ~j‘-' »4-v.


parties hereto as of the date first hereinabove set out. * Ida jJ---a J jjfdll jldl J ,_|i JjCjl. (


FOR THE GOVERNMENT OF THE A.R.E. ,, , 1 1 ~ '*





MINISTER OF INDUSTRY, PETROLEUM,


AND MINING


BY ---:--





l_~+U


EGYPTIAN GENERAL PETROLEUM COR¬


PORATION


BY ---:--





President


GENERAL PETROLEUM COMPANY i.Ul *SjJJI





BY : --------








IRAN'S WORLD EGYPT. PETROLEUM COR¬


PORATION





’ BY : J >jrr& •Sj* (


President








Jj,r-II j-*-’ j*- eu!l---1 ‘ifj


ST. JOE PETROLEUM EGYPT CORPORA¬





TION


BY : -


President


c-jij jdjv


CANDEL OIL (EGYPT) INC.





BY : ----------


Attorney-in-fact


CITY PETROLEUM EGYPT COMPANY cAt-*


BY :--_-- 4^





Attomcy-in-fact





 s. - < .


_____.-.>y ji\ *4,^11.-. • - ----------------


vi





. • ANNEX 'E”' .....(aJ


».'*'-**


CHARTER OF jjc


? OFFSHORE SftUKHElR OIL COMPANY





- ARTICLE I


■ ' * ' *•* t JiVt *SU_U 1


A joint stock company having the nationality of the


;UtAB REPUBLIC OF EGYPT shall be formed with the S*j»t_. isp oj£


authorization of the Government in accordance with the W' jLtlJ V^J ‘ ,JA -lie fLC^y UJ, ^ ^


provirions of the Agreement referred to below and of this


Charter.


Tiie Company shall be subject to alii Jaws and regula¬


J Sjts3 y »u


tions in foce in the A.R.E. to the extent that such laws and f^-***t V WiaJIt* i'lMlaAll sin J i ♦ i w


Cf Z'*-*'* «*VII .-U V y ,,


jmulations aie not inconsistent with the provisions of this Mr- W GJi juui juji uu


\\$a«er and the Agrcemitnt referred to below.





• ARTICLE II r


t Ajilifl 1


The name of the Company js “OFFSHORE SHU-





KHEIR OIL COMPANY” abbreviated as “OSOCO”. jA-Z *Syi a iSjJJI


J1 *


ARTICLE III


( 3jJti» ijlJU )


T he Head Office of OSOCO shall be in Cairo in the u jrJi





A.R.E. ^ * ‘L---Jydt j**


t


ARTICLE IV { JUljtl )


The object of OSOCO is to act as die agency through


•yhjfrji EG PC and CONTRACTOR carry out and con? tfJH J/J' jjJj S* * jO-a* » ^Jc4


' the Development operations required in accordance ,jS\ 3^ad);oUU js---?» <-V-'


i -ith the piovirions of the Agreement signed on the day twt *4---’ lAjjuijiitjifiK'


< ' ,19 by and between the ARAB REPUBLIC S>-jjilt Jjia^ 5-LJI J C/JI „-*•


' F EGYPT, THE EGYPTIAN GENERAL PETRO- . d 5-sici' J VjjUI otui


. -SUM CORPORATION and CONTRACTOR cover-


. ^Petroleum operations in the Area described therein- cCJ»c Sjcs d '-^t1 "‘■Vj " jTj-'J1* j-5


C SOCO shall also be the agency to carry out and conduct


E iplambOD operations after the date of Commercial Dis- jS UJ» jU J*, ru3t5


o very- pursuant to CONTRACTOR’S Work Program . ijitrfl fi*-v ta4 j3u.t


and Budget approved in accordance with the Agreement.


OSOCO shall keep account of all costs, expenses and ex¬ oli4ar4tj , iJIf-H <»IXI IjU-=- ' /r-J1 » *





penditures for such operations under the terms of the jit It t S ) jjJIU Ulisyt rtS»-X ^ 5 '-41


Ag cement and Annex “Dw diereto- . M


OSOCO shall not engage in any business or undertake tsh f Jr »t J»* Jj'j5 y-J


any activity beyond performance of said operation unless SJLd' Coitj J b* U oUmJI »iUM flySJl Jjbo


otherwise agreed upon by EGPC ami CONTRACTOR.


 ■ :f,- ju-, 'j-1 1 v Z-i-a ---...


mw- - ARTICLE V - . i ■ -i m ;y.'


, ■ , •


. -‘The authorized capital of OSOCO is’ twenty thousand





' ^Egyptian Pounds (L.E. .20,000) divided into four thousand J /.*; d. \-


>(4,000) shares of common stock with a value of five Egyp-


ttian Pounds; (L.EJ 5) per share having equal voting rights, • ''r' •


•dully paid up and noii-assessable. * E GPC and CONTRA* ■ ' ; ■•■•jdirk'.;


GTOR shall each pay for, hold and own, throughut the i j Jil*. iUiaJj \ »(|?.> jj jjajj Jjtiltj Jl y £*->?


life'of OSOCO’referred to above, one half ($-£). of the


cajatal stock of OSOCO; provided that only in the event JU---'1j 1 ( Yf 1 \Ji~ai 5_U!jw '^11 J---ti*. j~*jl # +Sjl>


that either party should transfer os assign a percentage ot »-*-*■ jll SJbJfl gl jjSU y <^1# K jJ’j-ijl t j£


all of its rights, tide or interest in the entirety of the Agree* JV VA’.i' 3fjin r+j # jjUsh


ment» may such transferring or assigning parry transter or 1^1 0° O* JJ11---1 J,' wl' y tf' Ul U.AJU*.


assign any. of the capital stock of OSOCO and, in that’ IJ'Wyl *«t» ge *---j£l» J.l g» j-'*'


event, such transferring or assigning Party (and its succes¬ J_5U\ o j'A\ tJi uk 4b t UUSbt


sors and assigns) must transfer and assign a stock interest J <='-»“■ o- o* O* ( Jju* o*j I


in OSOCO equal to the transferred or assigned percentage jl ?L)jSdl Ljlil a---jJJ ^.L---,• <1 jfj--->jl # *SjS Jib---1_» j*f---•!


of ownership interest in the entirety of the Agreement. .'UUflj ».U y 2JLiUl jJU- y


ARTICLE VI


(AJbufi «m >





OSOCO shall not own any right, title, interest or Vs UU-ju; Vj ^ ^ (i »*Sji au-j_y_





estate in or under the Agreement or In any Exploitation J---“■ 5 >■ j*j ji j


Lease created thereunder or in any of the Petroleum pro¬ 1^1 g* j 'h »i» 0s Liu JDlii---1


duced from any Exploitation Lease area thereunder or in


any of the assets, equipment or other property obtained or Jj---(j Vj t SJiVu"J\ yjiiuj 11 <»l---U ^r* **■ -Aac


used in connection therewith, and shall not be obligated t *i« jl 4 W-1& Jj. jj ,_5jil otj»« 5j1 j,1


as a prindpal for the financing or performance of any of (J---«l CllUi* ji y, i oLLaJI ,L*Q jcj *!**’


the duties or obligations of either EGPC or CONTRAC¬ iy csl gh CijjiA ftjdt _*1 *tjl ji flj-h


TOR under the Agreement. OSOCO shall not make (f s Sj"jji jjw yj . g/id>> Jjtiiti jl


any profit from any source whatsoever. --- . 0^ tjl o*







ARTICLE VII • < **>}_St SAJtt )


\ , .


OSOCO shall be no more than an agent for EGPC and . JjUttj 0s JJj lSj~- c---J *





CONTRACTOR.' Whenever it is indicated herein that A. 4>~T jJ-jIy jt-v 5 jl• itj--- gl J jfj


OSOCO shall decide, take action or make a proposal and jJ-a cllj o! f j**II 0*j 4 *d!i A,L^U jl U>tjilt t£J-S jl


the i ike, it is understood that such decision or judgement


the result of the decision or judgement of EGPC and . (j*


1NTRACTOR, as may be required by the Agreement








ARTICLE VIII


OSOCO shall have a board of Directors consisting of < *Uo£| 4JU> y Oj^* »Jj1 > ifjOJ o^C>





ei.;ht (8) members, four of whom shall be designated by VjK Ojj---U i»Ul VjSi\ g- ^ (J) iwjf £ft*?


EGPC from among the General Petroleum Company per¬ ys>jj • JjUt gj*;j s


sonnel to be loaned for the purpose and tire other four (4)


by CONTRACTOR. The Chairman shall be designa¬ g---tjw j-i^ ^.-«» Cji?


ted by EGPC and shall also be a Managing Director' ; *jljt g,.bfc» jfc j---ij jkj flail jJJll Jjt^fl


CONTRACTOR shall designate the General Manager


who shall also be a Managing Director.


 .s of tile Board of Directors shall be valid if a

of the Directors are present and any decision lit yi * ■_,& V oUU^»yi ®JU j


sch meetings! must have the affirmative vote of 1^1 jlj • tUatVI n ot'^t jsn s* *A» ^


nore of the Directors ; provided, however, that J ^ .W Ju. o’ d j«i ,«1 ..:i' f -•


or may he represented and vote by proxy held by !


ircctor.





ARTICLE X





- meetings of the shareholders shall be valid if a











of the capital stock.





ARTICLE XI


ir jf Directors shall approve the regulations


a_-UJ1 rlS^Uj uaH jji jlN


ic terms and conditions of employment of the J.UU i^1 <-!.? s---■ jjJJI £^jt u&J* fDV.ib •


>J' OSOCO employed directly by OSOCO,


dgnvd thereto Ly CONTRACTOR and EGPC.


rd shall, in due course, draw up By-Laws vf fUJit!! ---Ull cJ jit SjIjYI . •••


TV:


nd such By-Laws shall be effective upon belli*.; A---a.*yil ^Uj^l j J-tg dJIiljll -i»i |jf j -jY


jy a General Meeting of the Shareholders in . mmi'o-* j--n


with the provisions of Article X hereof.


ARTICLE XII ( o Mill )





shall come into existence within thirty (30) days cJL cr* '■•Ji tV-I iS-3^ 'jl


ate of Commercial Discovery as provided for j . <_5lirY1 ^ aJa j-.tjaU* jsu ^jle


-ement. !


'ou of OSOCO shall be for a period equal to 1 __ ijL+s JJlSfc. « Ja-1





of the said Agreement.


tt




above is terminated for any reason as porvided • '-»r» 4-1* J*' ?





JjjiJl 5..MI


EGPYTlAN GENERAL PETROLEUM


CORPORATION





By :








GENERAL PETROLEUM COMPANY “UMl





.1- ; ' •


BY :





CONTRACTOR UjP-W


I J.


!:■


By :





.V* : a,^ui i*un aL«n V* ;«4. nvA

; • u^ ''J1* o_y


J_»_/-’0 ■.*W1 J »jvS \JJ>> '*1 a---»_jU £* jW V j ,/jjJ tj^j --- \ lit*





w«.l j \«vr^-J t 3 ^ jj:U!l I---*rjt V Ji^' Jc J^-'J


■ I ■ '


■ 15 't-i-'j? wAoj A' ---acjs^* ^ ^p-





-,.;lj»!l ►tiv'JVi ja»^ jy-Xj jjiUll *y ii>_.U j"^>" iC o_}N." --- if jiU


’ . . i.L» / ■ ■■■





, *J?^Ji j jjiUH liii j£li ------ y* ijU


’ -i


)


l*>h 5^# ■-* • < *]j ■’Jl ],v^ ^ i->


■\.--





( uv! J>,;V ra ) ) M i <-:a-2' j i j f J *^





o' _y)


 1








$■


W\i -O JJbJI --- J\








. AMENDMENT TO <:e-


PETROLEUM AGREEMENT


between *.


GoTeinment of Arab Republic of Egypt '**£*•


and '*





Egyptian Genera! Petroleum Corporation 0'*^ 5----JU


- and


Transworld Petroleum Corporation JjLpJI





THIS AMENDMENT, made and enterd into this day-pf---t iXte'i \ V/t --j jUj c Jj,a4 Ia> jjA .


19*4 to Petroleum Agreement (herein referred to as the "Agree- •-r-’r.r.V J**1. Ji.J-J U* j V6 Jf'ii )


DC! i authorized by Law No. 65 of 1973, by and between the


VP . REPUBLIC OF EGYPT (iterein and therein referred to as <- \\\r £---f *ie jj


* ••GOVERNMENT’}, EGYPTIAN GENERAL PETROLEUM i---- ft'/*! i+jQ-V* j&>


C* crORATIOX, a legal entirely created by Law No. 167 of 1958, \*tvf*j jy# v*j=, ^4-** Vj^V-3*


u a tended (herein and therein referred to as "EGPC"), GENERAL ■i*«V J

n "ROLEUM COMPANY, a company affiliated to EGPC (Ite- -r%J ) *---*•*!* 'Pr'^J 4 Ojj^UiaVl yin


reii referred to as “GPC"), as assignee of EGPC, and TRANS-


W< i|U.U PETROLEUM CORPORATION, a Company organize*1 P/.} 3---ju vi cAp J (tr kAA »j*a, j, ^ j V*


an< existing under the Laws of the State of Delaware, U.SA. JJ >o Vi) Ojlyb ’S'jZ JjjLU jljy-il/


(begin sometimes referred to as "TRANSWORLD"* or “Contr- Ja& 5b-l jxdl lA* j V j»j } lij-d1! PCiP


aclir") •• - (“tWJUjiv-V”


rt'MI'.KEAS, the Agreement, granting EGPC, and TR.ANS- 14J51 JjUr ‘Ijj i----_JU £.c


WOK 1.0 as Contractor, a concession for the exploration, develop¬


ment mid production of petroleum m the Shukhctr Marine Area 4 UlVjflj iij*jJJj ULi. j *cp\j cJr J 6)Jr' y®


dcsrjilvd therein, became effective by virtue of law No. 65 of *io p \ ^yr xs

. .ective on ^ugust 28, 1973 ; wvr^J


WHEREAS, die parties wish to make certain modifications to > Ija---f. c/*,---' *V) j 0y*j_ • A* i


the Ayieenieat ; NOW, THEREFORE, the Parties hereto agree


to amend the Agreement as follows. , . uunn


fusing capitalized ^erms as defined in the Agreement : * •; •’<&**. *


(vw Ijj /i yUl i/0








1. jirun.lnunt of Artiele 111 (® j Sjsi‘1 : Ail'jJl SjLAI JiA*» ~~~ \


Pinijranh (e) of- Article HI of the Agreement is hereby deleted


: nd the Mbwing paragraphs (e) and (0 substituted therefor : •• ( j ) j {^) ^yak jAiij uwsi j. wta wV» o* :; r'. '^r *.„C* *.





(?) (O Contractor shall be subject to. the laws In force from V) {*.)


mpe to time of the A.R.E. and the. political subdivision* ]


thereof which impose taxes on or measured bv income v*lj-i 3 V VJ! "pi x4sst&;-$s*'


or profit^ including those laws imposing tlte commercial ^ Vi L.i \jV* 'in*








 4





A


iV


I >\vt





and industrial profits tax, municipal tax, defense tax *.4JI V^V^WII Jll


and national security tax in income and dividends paid


•with respect to shareholders (hereinafter referred to as . (&f-c)J-W l^jUs, )j^u ^


"A.R.E. Income Taxes"), and, except as otherwise provi¬


ded in thisj Agreement, shall comply with the requirements JjUii jp < j d)i ^ ^ u


of such lairs with respect to the .filing of returns, the c-is'w .b


assessment !of tax, and the keeping for review by aulhori-


aed persons of books and records. For these purposes, j** ha


any A.R.E. Income Taxes for which Contractor’s share¬ jCJ gUjVfl j, . gjfleVl


holders may he liable shall be deemed to be a fax


levied against Contractor. The share of GPC (as Vi Jiji


assignee of EOPC) of the Crude Oil determined under J& J J* J( J«jj Jj'ill j, i>jfjtA JLj TH


Ar ide V includes an amount equal in value to all of lib i>ui j Ijjit ru:j c-J ^ (i--->1 \J[ 1974


Contractor's A.R.E. Income Taxes. meof


(2) For purpose* of applying paragraph (e) (1) of this Article, jJjwll J. JMI J IjU ; ara;"





=*-** •*»«>*( t) (Y) .• o


th: total taxable income of Contractor in respect of any rfl-


Tax Year slud! be an amount calculated as follows :


t) The tot*.' of the sums received by Contractor from • J* UL. c* i


t


-J! ^ j,a» uuir ji £di -1 h -i


the sale or other disposition of all Crude Oil


acquired by Contractor pursuant to Article V, par. c-jn jrj : v


agraphs (a) and (b) ; t


; Last r. ac~.


. i •* /*.** '


LESS ! . v:A


. * -* **


a) The costs and expenses of Contractor which are 1(5*1 J)' CvU^-ali^ ^LHS3 (() ; . wo : ;


t •


allowed to be recovered in the Tax Year under (l ) ^ <*** VjdJI iUI j UibjL-i r*n


paragraph (a) of Article V, and. dew


_> t jiLJ.1 j. O pi


b) The amount paid by Contractor to GPC (as as¬ Ji) jjUMVui J* (^) :V


signee of EGPC) pursuant to the second paragraph U.


of Article V, paragraph (a) with respect to ex¬ j* ( t ) 1_.jll


cess Cost Recovery Crude Oil received by Cont¬ J__UU1 - ^ I- .t'i -


ractor ; . J y Ull aJ* ^La.-^ ^jjij i H£UI


PLUS ti) An amount equal to Contractor’s AJx-F- Income Tax. : Ulj


(£,• j>hi * UL» --- y





(?) CPC (as assignee of EGPC) shall assume, pay and discharge, '**k > (b-jU \r\[ oJjU* (r) .


on fr-fcaK of Cootntor Contactor's AJLE. -Income 6*


Taxes out of Site sums received by GPC fas assignee of * (i~.£l yi oJjl: J.I) v'JI UUfcr Jl! £UI


EGPC) from the sale or other disposition of hs share


of the Crude Ott • fU-l ij'l ja y~4>- j jl t


iv yi X:


.y^..u- »?•





i**





v;


 f:








4 Hvt j----!• t* <£*) 1 \ *■*-» --- V-J51





(4} GPG (as assignee of EGPC) shall furnish to Contractor j_,uu yicJ jt-ji fj* (i)


the proper official receipts evidencing the payment of vp. ) J"


Contractor’s A.R.& Income Taxes within one hundred (\*-) cr-'b i *M\'


fifty, (150) days following the commencement of the next


ensuing Tax Year. Such receipts snail ne issued by the ijjW ***fUi


proper Tax Authorities and shall state the amount and gjiJii ^ ^ ***** '*$s& oyaU1 o*


other particulars customary for such receipts. ■. ^ v jA '


(/) In calculating its A.R.E. Income Taxes! GPC (as assignee of ^Sy» jW y\ t^ )y


EGpC) [shall be entitled to deduct royalties paid by CPC (as


assignee of EGPC) to die GOVERNMENT and the A-R.S.


Income Taxes of Contractor paid by GPC (as assignee of EGPC) • J .M' (f- W ( i---'jb \,Jl c.1 j\;;


i


on Contractor's’ beliatf.


fT ' 1


Ni.,


2, Amendment of Paragraphs (a) and {b) of Article. IV, ; i«\)\;jUU0*(V)j(\)-ib*®x


• Paragraphs (a) and (b) of Article IV of the Agreement are he¬


reby amended to read as follows s


(a) TRANSWORLD shall commence exploration operations he-


reundtp not later than six (C) months after die Effective Date. jii-l cM* O'


Not later than the end of the fifteenth (15) month after the


Effective Date ; TRANSWORLD shall start die offshore ex¬ br*^l takil j


ploration drilling in the Area, and the drilling shall be con¬


tinued tilt the end of the exploration period * J---^


(b) TRANSWORLD shall spend a minimum of Two .Million Six \f JV^ *■* j ^ (v)


Hundred and Twenty Five Thousand (2, 625,000) U.S. Dollar?


on exploration in the first two years and shall spend One b^b-5 (ttfo-• ■ ) W] o


Million Five Hundred Thouand (1,500,000) U.S. Dollars oVJj1 wb'Sj-* O’


in each of tike third and fourth years of the exploration, ci.y .....)>JS\


period, subject to its right to surrender as provided below in ^b^- j-^’.Ub fjp.ji -K^, j


this paragraph (b). TRANSWORLD sliall be obligated to ^ ^sj j \ji! *•* i_M


drill!two exploration wells in the Areal If the expenditure


i fJfrj 5^*3 «i* j ♦ijl


by TRANSWORLD in' the third 'year shall be less, than the


amount specified for suds year, TRANSWORLD sliall be . iikil j l v.'


obligated to expend the deficiency of suds expenditure during ^ 6U ^ a ai^v ^ or


the fourth year. In the event that the expenditure in any


period or year hereinabove, referred to shall be in excess of ^ j ^ M* &£ S. O^ 4 'vjryjfc


the .amounts specified for suds year, such excess- shall be j) j oS'lilj ,


credited against the expenditure obligations of TRANSWORLD ^ 6V e did ajaii ^S.\ ^ xtWltf&JgjjL


lor 'any succeeding year or years.


 \vn 0 li (^k) J \ a-xJ' --- V'-j' tjj


0





In rase Contractor surrenders Us ospW.ninn nhlijsiiinns in w^t/f *j> (j* ( X ^ S.jL.tK K,_,Jl *Af- -X-6 ^ ‘-h* iiiAj


>.<> Agreement at i^t forth above bcfoic or at the end of


5 s-rcoittl (2nd) year, of d« .initial exploration period, having


pended Jess than li« total sum of two Million Six Hundred J jlc-j Z-r>j

wenly Five Thousand (2,625,(100) \J.S- Dollars on exploration, >;C f\\ oi'ijli obV <7


- Ju the event at tltit oik! of tlie second (2i«!) year Contractor Mfi iiWM j A* JS'l»- j J* 1


as expended less'than said sum in the Area, an amount


qua! to tire difference tom-gen the said Two Million Six £j» j*l Jj'Al J* £,*'* \\* JA, ty,-* V« *X-JI X\f


Juodred Twenty Five Thousand (2,625.001) TJ.S. Dollars lilt *---N".> ii'e-'j .j'ijAU jy crj


nd the amount actually Spent on exploration activities shall


« aid by Contractor to £GPC at the time of surrendering Si!L- 55^Vl »A«i\ oWj" o'jVji o* ( Tito. ♦. j


ir in three (3) ljnonths from the end of the second (2nd) 1a» kJa^il '%& C£>$-Si


,-ei> ’ the initial exploration period, as die case may bo. An VIW i~.il iA^. j jl J»*iB -k* ^U.1


;• ;nditur« drficiciicy Ivy. Contractor at the end of the Fourth


V< r or in case ufj surrender nl the end of the third year (or j t/' ----■-*- ;jo


i|. rea ons just ndted sltall, similarly, result in a payment by -JU J )\ S^i Cr1 (-) J Vy djlAJ


C- itra' tor to ECPC of such deficiency. Provided this Agiee- 'j vL^‘Mi iJt'l i~JI ur- JjUll ^


m nt i. still in force as to Contractor, Contractor she!! be


er idee to recover any such payments as exploration cxpei:- JjLil) *«ja. j>«)l U---i jL^» ic_ ^»lu jl l*J*a


d> ure in the manner provided for under Article V in the l Jj^-&- *j-A' V »lib 5JU-


c\ent of development of Commercial production- j h\ **


I





. sfjl*' *rfc*i 5JU j a^«U-I SiLAl^lfAa^y*Vfc jJl*. *





.l«i'.'(/i"vw>»< «/ s<Ull isLAl (j* (_f ) 2jUH S--- y*


second Par-vgrapb of Article V,'A if hereby amended to . read *• it 'jv^ SiO.1 tf[\) !j«® t U» s


fvllmvs :


TR.''YS,A'ORt.n rliafl take each year forty (•Id) |>ftvcnt of J ,j» (7 t' ) 2JL.U j Aj-4^ ^ jJjj---w\y AiG


rr > oil produced plus its diarc as stipulated in I'aragraidi | a^lJl j A.U yJSjJiU Ip-vsi '.,Ji l»li* «:A1 ^Li-l O jl c-j^


rf this Article V and shall pay to EGPC within fixty (PQ} days ! a *-»'! j! ((dej »iU.l »i*


oin tlve end of each quarter m cash and in U.R. Dal tars the : wljVjJ* j Ui ,j' Uj».( t< J


lft'enence hwteen the rakte of the nU «eei»rd am) the actiyJ


prrating crwis m be recovered (or *1* quarter. ^i*.d5 2JmS ^J.1 wjll uJ jjiH


. *J! *>j! |jl(^


. AMi Hi/niral of Ptmtgntpk (d) i af Article I-'. (UuT : i-.lilliiU-] A*--- Ji-W----I ;


l’ar»Rraph (d) f of

ollmct •.


rK.OsSVVOUI.D dv U, during cadi year, take, receive and freef^- o* OJ4 JT ib(k OwV


vport it* ibvre'el crude oil under Paragraph (b) of thir Article j5I5jA-^U:\ oiUl ai> ^vjj ^iill A ;


as well »» the forty (40) percent of tbs crude oil to recover the t aUj^N W f\fc\ ^CU^.V t


•item ting carts. The tatee rtf any cams quantity

• 'tithd to TRAXSWORl-D stall 1« paid in cash and in U.S. ;^idl wli'i'j'l wU^iA ---'jS tu* Aj; j! i)ej -


Kvllara ti. V.OPU )iy TlkASRVi’ORLD within tixty (60) dves from • ^ & J^*-1** 6* h'. ( v ) jjj» J £ jl Je;


he cut! <•!' «w>h qnartei.


 nwt -V» e <->' i ‘V----- , 0*19




5. ytiwfrtrfmcni of Paragraph (fc) of Article l-'. . ■ •■, ■ ijA 'Jl J.W ; A---i^lil SjL.1-1 fjt • a





Paragraph .(b) of Article V

to read ns follows' : * "' " ' '


• *• • ■ .. * -- . *•*. . *. , » j'' Vr---VaA'a'LU j (i' ) ^ j-*(o)•


(6). Of tlic remaining sixty (60) percent of crude oil,, LGPG shall


i . ' • • i .


be entitled to take and receive seventy seven Slid one half d (.VVj«) O^J


(7?.5) percent and TR'ANSV/ORLD shall bc'cntitled 'to' take Sflll j ^ ) Mi-'OJ lT


*. and- receive -ttrenty-two .and one half (22.5) percent, provided


1> that die -average .daily production of sixty; '.(GO) consecutive *LaV Uj>. ^ *1 • ) if~---* LJ* $


i . •


.days reaches fifty thousand (50,000) barrels' ot crude oil per W*jt O*-------^ v>* , ( ^• )


* ' * • * . .s’. * . •» » ’ * * • * • ••»/*


I day. However, if-the average - daily production of sixty (60)


^ consecutive days b less than fifty thousand (50,000) barrels (,.11 ---L.U A. ---Q^eu t»U^l il-Jfl y* Jjj.( «


of crude oil per day, the above referred share'shall be* seventy* ( Xo ) CijS-fij ii (.Yo ) jjv*^ Ul*; v


five (75) percent to "EGPC mid twenty-five - (25) percent tn





‘ TRAl'pWORLD.* It is'agreed that once the average dairy


«f, -• f


-production-of sixty (60).consecutive days readies fifty thousand iiX j-tiys ^ yji sJAjiAl &J. ry '


, (50,00jJ)- barrels of ^rude oil, the. share of; EGPC (77.5) sluill 'p irtt'Iy"''.


t remain, in effect, throughout tlie duration of the Agreement { o* • • • ) v-ili cn---^W cip '• ■


L---jU<^>-( /.YV^ ) Lu-Jl ,j


and anv renewaL S----AT- Jit* YY.o') s-fij





SAa J<» Jjj\---^ Aj--- Jl





6, Ainrnsfmcnt of Third Paiagtaph of Article If j-W • i^tll Jj'il iliUll --- *\i .


The Third Paragraph of Article II of the Agreement is here-


* i •; .. • « ... : Vxi) Jj-bil 1^ ^ i^UUaLil'^


by amended to read-as follows :■»••••'.. .,


r '


Annex "C" is' die form of tlie Letter of Gtafeihtec* to 1« based' iU+j i (. jjx* ilL’9JA^ ^ T J.


by the.Sample. Misr, Cairo, and to .tie submitted by*.Contractor


at tlie tunc, of signature, by the Minister of Petroleum, of this si\^j J* £:\


Agreement for the rum of Two NtiUion Six Hundred Vvrcntv Five - SA---^t'YY0* *' ) Cr TA •.'


Tliouand (2,625,000) U(S. • Dollars, guaranteeing *tle execution


of,Contractpr's,;ninimurn exploration obligations hereunder for tlie u*. JLsi j'tl-Cp1o\-ii ;


first two-(2) year exploration period. Sudi gurantee shall remain Cr* 0^1 ^ t) vA ^ v^‘:.


effective !for six .(G) montits after, the -end of the_sa'ul two. (2) year


period except as it may be released prior to that time in accordance •j'i *V ^ ^ jji


with the^ terms thereof. * • W* ijJ ■*“£\ ^ f 'ilCvy


:* ......... . •«>. ,C.*. : I • \


1.’Assignment of-Trensworld’s Interests m Agreement.. .... . ,





Transwdrld Petroleum Cdlpomtion'hereby Assigns- all of-its


rights, privileges, duties and-obligations under the Agreement, as


ascended hereby, to the 'following corporations.(herein referred to


as thc“Transworld Egypt'ConYpanieS'"or flic‘-Transworld Egypt - -Jf V>i-U. Aiii'Vl . %


Group"), all-of whichj)trp fincporations.,or(Finizcd and existing under





It'll. I J ■V.ili1


 I











ti’ (gfy f ^ -AJI ---


Wvi 13 O


1- rs i f die Sate of EieJaware, United States of America, to iwll Ottyi


p


di\ Jed interests at specified belovr : ; ji-Ji .mH lou-iii ., 5.,


I*r. :«worId Egypt Petroleum Corporation 20% . - - w ' »•> <. ^ P


V.r- to •


St Joe Petroleum Egypt Corporation '*20% */.f w


Candel Oil (Egypt) Inc. 20% ■ ■ 7-v





• i 7-f.


City Petroleum Egypt Company 40% -Vr?;


j Notwithstanding such assignment, Transworld Petroleum Cor- life


on' shall remain liable, jointly- and severally with the Trans-


j or* Jgypt Companies, for the performance of all of the obliga- cr. S jy Jbj-lr ^ -V''*:' '


j .ins of Transworl^ under the Agreement


Each of the TrantHOfW Egypt Companies hereby irrevocably ** •* * *** ( v*~:yc£ijZ “!


| .ppeinu St. Joe Petroleum Egypt Corporation (herein referred to


J i» *'5t. Joe") as its agent and attorney-in-fact with full power uM-WbcJkJWrui*, , .


; md authority to exercise all of its rights and privileges and to %\, yUvi „vsfci,W^tiuis,


I epresent all of its) interests in the Agreement, including, without 1


; iirtii'ation, die power to e.vceute all instruments and take a)! other JO 4 Jf * ^ rVVW^ *LH ^


tetir-n in its name and on its behalf in connection with the Agree- ::V- :


nent ; and each such Company hereby ratifies and confirms all


hat St. Joe may |do on its bclialf as such agent and attorney- f^z/iotc~ -si -


n-fa-.t. Each of tlie Transworld Egypt Companies agrees to appoint


j


:lie general manager and the deputy general manager of Sc Joe


i U,aT j:


iv. general manager and deputy general manager, respectively,


td ..grees to maintain an office in the A.R.E- Tlie Government -


I


. iid EGPC shall be entitled to deal exclusively with St. Joe and rw ‘v* cw ^ c ^u‘w d *---^


i s general manager and deputy* genera] manager in connection


- ,-ith all matters affecting the IVahsivorld Egypt Companies or


.my* of them, and each of the Transivorld Egypt Companies iliall J*~L‘ :


I e bound by all tiiat Sc Joe or such general manager or deputy |


! eneral manager* may do on its belialf. From and after the


effective date of this Amendment the terms "Transivorld**, JUJ a^j U> ^ ^ tUM


' Operator" and "Contractor" where used in the Agreement, as


.-i mended hereby, shall be deemed t? include the Transivorld Egypt lUUrVI J ^ "'.JjUU - y - ^ ^ ^


Companies. By executing the acceptance of assignment at the ■ ,;5v


Coot of tills Amendment each of Transworld Petroleum Corpora¬ J y*s* Jw-a; jrat Jjui


tion and the Transworld Egypt Companies hereby, jointly and ^ »A-a ^ V;. ?


V r c. ■* V. , --- , . '>,2





■ . *





 \wi ii' ^ jaJI _ Lwjl i'jj_jpJI





severally, agrees to be bound by all covenants contained in the . JiJudl 'A* wM


Agreement, as amended hereby. The Government and EGPC JjUl J-A-dl Iai a---1’ji'j


and GPG hereby consent to the foregoing assignment of the interests


of Transtvorld Petroleum Corporation to the Transworld Egypt . VI


Group. CPC agrees (as assignee of EGPC) that receipts for AJCE. l---1jj* oj^-f J ( a---y[ cJjt- $} u-*' • •


Income Taxes delivered pursuant to Article III, paragraph (e) of UU.'NI Cs (*) *J* ^ ^ ‘vW* f’E.)j


the Agreement shall be in the respective names of the Transworld


Egypt Companies, as their respective interests appear. . V-Js;


0. Effective .Date of Amendment





This Amendment shall not be effective or binding upon any vJlJtA

of the parties hereto unless a law authorizing the Minister of


Petroleum to sign said Amendment and giving Article III of the

- . ,/eemcnt, as amended hereby, full force and effect of law not- Vjyi Jo jyj


.distending any countervailing governmental enactment, is issued <,Jij»\a!1 • »*JJS*j^A*^Ia*AC,





'nd published in the Official Journal of the AJIX, Except to the • (t* f *c)^ ^ ^ r.V


Vw extent amended hereby, all of the .terms and conditions of the


Agreement shall remain in full force and effect. i.l'ai-'j SJUr'il A1





. li> ajj- C Ji-U'JI li. y jA,!.


IN WITNESS WHEREOF, this Amendment to the Agreement .X* y UJ.I ^ Jji: lc


lias been duly signed by the respective parties hereto ns of the


date first hereinabove see out.


EGYPTIAN GENERAL PETROLEUM CORPORATION


BYr --------


GENERAL PETROLEUM COMPANY "X*


BY': ------


TRANSWORLD PETROLEUM CORPORATION “■ V*


BY : -i----------


FOR THE GOVERNMENT OF THE A.R.E. MINISTER OF


i< PETROLEUM •


iY ---------


The undersigned hereby accept the foregoing assignment of the


* oM A*\ CjjJjU a


interests of Transworld Petroleum Corporation in the Agreement


and hereby jointly and severally agree to be bound by all of the ol lA> ljU,J vMia


covenants contained in the Agreement as amended hereby :


TUANS WORLD EGYPT PETROLEUM CORPORATION


BY s ---i------------- i;


President


ST. JOE PETROLEUM EGYPT CORPORATION


BY --.---- 4,,Jl - :r > y;


President


CANDEL OIL (EGYPT) INC


BY -----


Attorney-in-fact


CITY PETROLEUM EGYPT COMPANY


BY : -------- 'X4 is~) tUYv-. y


. Attorney-in-fact ■S'* .














• <4 V


 'Avl -Ji e j ( gt) < \ AiJt Jl *j,








(£) c5^


ANNEX "C"





LETTER OF GUARANTY


*.*»Y -_


Cairo, 197





I.ETT'CR OF GUARANTY NO.








EGYPTIAN GENERAL PETROLEUM CORPORATION


C kmen, 15^. cAh4 ^ ; dt-1 .U gji


.oc Undersigned,' Basque Misr, Cairo, as Guarantor, hereby


axantees to t!ve Egyptian General Petroleum Corporation (he* (l---jU Ji W jc1!tjj^jj f.alli---.is {(*vs ?rCr,;,


; J^(fVf****)'*1' ^a t * : y •<{*>' .


reiiafter referred to as EGPC) to the Gout of Two Million Six


Hundred and Twency-Five Thousand (2,625,000) Dollars in U.S. J-VV f J* ^ i cAtfJl


currency the performance by Transworid Egypt Croup (hereinafter ' VrSca? Ji V*. i/’?;


referred to as Contractor) of its obligations required for explora- v-illOf jVi’Aixt-sJJoU/1


• tion operations to spend a minimum of Two Million Six Hundred ' ^ jij* (tvc*.,; y 'i ’


Twenty-Five Thousand (2,625,000) U.S. Dollars duriw; the initial


aV‘ o*Ar**A^ wlji- c'jj'f'1 c/3-JI ijs-


two (2):years of; the exploration period under Article IV of that Vl 3) o« '■■V1 JjA f UoNl UUV =■ J


certain Concession Agreement between the Arab Republic of Egypt


(hereinafter referred to as A.R.E.), EGPC, General Petroleum Cor¬ ) Jjl^ {£■ (■ Jtle*'-. -


poration (hereinafter referred to as GPC), as assignee of EGPC, JjUll y&3 wjU VLcJjt; Jl. («^ ^


a >d Contractor as assignee of Transwortd Petroleum Corporation, 1 \ W j '*$/* a* S/i


i -d August 28, 1973, as amended, 1974.


ft is understood that this Guaranty and the liability of the Guaran-


jj-Lkll \\<3 *-*<► (31 Cy) .* ' , ..


hereunder shall be reduced quarterly, during the period of


expenditure of said Two Million Six Hundred Twenty-Five 3---a*j J Ur-j ^lol is* JV*- ^^_«!«> •>


Thousand (2,625,000) U.S. Dollars by the amount of money ex¬ •AfA


pended by Contractor for such exploration operations during each tj^i- si-a p Jo


such quarter. Eadt such reduction shall be established by die


joint written statement of EGPC and Contractor. Ia^! i>. ,j* j* J5j • V.-





In the event of a claim by EGPC of non-performance or surrender i «Jj 'il


of the Agreement ou the part of Contractor prior-to the fulfillment


of said minimum expenditure obligation under Article IV* of the JaL.t lA ^jaV- Ail »ijl JJS-traViyO


Agreement, as ^mended, there sliatl be no liability on the under¬ > M ilUajjCr ^ ■;





signed Guarantor for payment to EGPC unless and until such UjhJ'.Ao ^


liability has btjen established by written statement of EGPC set¬


ting forth die amount due under the Agreement.


w S V ^ 7;:-!jv








■ -\ •-’'j'-;' i A’:


? i.1. •


 i





10 •'«£(£*) < \xui _ <~)\ sj»/Ji


I


•I: is further condition of this Letter of Guaranty that : . . ; JLhJ li* j injUi j •


1. This Letter of Guaranty will become available only provided M 4 W SI JyiW ^ ^ ^ ^ " '


that the Guarantor will have been informed in writing by & *rjW'JjWI


Contractor and EGPC that the amendment to the Agreement


between Contractor, A-R-E. and EGPC has become effective ^


according to its. terms, and aid Guaranty shall become djV * ^ ^ ^


effective on the Effective Date of said Agreement, Le. August ■ wre*^ tA O'.


28, 1973.


2. This Letter of Guaranty shall, in any event, automatically trt^WA u* tsl •. :


expire : •


a) Two (2) years and six (6) months after the date the Agree¬


ment becomes effective, i.e. August 28, 1973, of





b) At such time as the total of tl»e amounts shown on quar¬ *,y- ^J1 olj'yVI J V*" (*■*')


terly joint statements of EGPC. and Contractor equals or JaSI -i£ \ jUV--JM '*A* : | ; -J


exceeds the amount of said minimum expenditure obliga¬


tion,


whichever is earlier. • Jr*^ CN* jUifcSV ; B


3. Consequently, arty claim in respect thereof should be made • > '*$£' V*.vs


• •**.'.%£-' *>•


to Hie Guarantor prior to either of aid expiration date at ^.UUl ^ -3 V11* V W #


the latest accompanied by EGPCTs ’written statement, acting' jlyV O^Jl ‘^’s/z^'Cr'iVj^V :^


forth the amount of under expenditure 'by Contractor to ; eV>V WjU & tftT Jm-


the effcee that :





«) Contractor has failed to perform its expenditure obliga¬ «A* j -Ul jliil .J^aJl jl JjUll j\ (\yi


tions referred to in this Guaranty, and





t • , * cil cl ^ -


i>) hai failed lo pay the expenditure deficiency to EGPC-


A*1 jjl*= jlVIchilai* jU>^,


We declare that on issuing this Guaranty ivc did not exceed the


limit of total Guaranties which we are entitled to issue as per *■--«*'&$•.:■ V


Ministry of Economy's letter No. --- - dated, ------- 19 _


Please return to this Letter of Guaranty in the event it does


.atll-ilx*V jL- £y4ii -1 jl t ItJl ilUj ■*


not become effective, or upon the expiry date.


Yours faithfully, ' wUI ■ .


For the BanV


Accountant Manager


rrva.tvrfMmvSij.'it glUt *j_a SJJt i^lt


\\Vt/-\e jIaj


 j. * r-V; ■ - f-jyjuc-


’’•j? "


$ '





l-L-jUI i^-Jl


yt


\r\r ‘-^•jW














'■r~ij\s


•U.---








■---





jj.Ud j V^l ,/j.jJ ^r=V-^^! MVY O.y'*


jt- <3 Jj /7I.' “kUM 4> y*U i---Jj JuD j &j** ^


£ ... ... „. _. „. ... _. A) jPeJI A.a]£> t$ ‘JMiw'ij jjP





WjV


J--- a»UI





A ............ _. -.....-.....SJUr^J _ y


^ -. -......... -. ...............sAiijj^y.!^. _ y


^ . -...................oU«» SjUb JlSjlj JJI ^ -2^ •■?• i N





\ Y ...... ... -. -. ... ... ... -. ■»-«Jt^dl --- o


^ £ ...... ... ... ... ... .. ... _. _. _. i}j*0 ^ i---»jU iiCU .---. t


\ 0 ... -. ... -■ -. ... ... ... ... ... ... ~. ... ... »i>liLJiA»w* --- y


\ o --- -. -. ... .., -.......... --- t_fSCi! \


\ "V ...... -. ... ... ... _. -. _. JjL-i-l Jj^Jl Jc ^





oUlifr^i --- V





. '* ■*: * ■'* >■


 Wj?





'***-* ' • JaLll


<4


\ A --- h. ... ... „, CjUL^ ; jfUi ---


\ A --- --- ... ... -. -. _. _. _. _.


Y* ... -. --- -. ... -. ... ^,6 Jjj-ilj.


Y * -.......... ... ... ... ... ,.


Y * -....... c-« jJ»j ^ o





Y \ ............................... £\jUlj^l^Il -n


Y \ ... ........................ .. *3U-Vl ^ - w


YY ................................... Jjbli - u


Yr ....................wyi iu-j uurvi J:>uvi --- ^


Y i --- --- --- ... ~. «. ... ... ... -. ... ... „. ;.,»UII ;_ji!l ---


Y 0 -■■ -....... ... ... ........... ... ^^nd\j olftj'liU --- T \


Y *\ ...... -............. ... ... ... --- 1*Y


Y *\ ■-■ -■ ........... U* 5*all Oj^l 0Jjlill ---


YV ....... -. -. -........... o^' --- vt


Y V --- --- -■ ••• -• --- i-iliOlJ 4-j^I j-a* +JJ+?' --- yo


YV ...... -- -. ... ... _. 4*1*0 4j j-all A*w.jU --- YT





Y A ......... ( --- *----'jU J »Vj3*iJY

y a um\ a* \jjs j\ iiiai


i- ^ ^


r* -- ~....................... ^-uuifcii «>»&&[


 \W J (^t) XX jaJ' - V-«r' •*.-£*








nvr i-J no fjojs


£ JjUdi ^ J>j\Jl j j_jl


i}jS^ ti->JI

jXS> i*io J


^_*sJL)i -Vu


♦ r *


i


>


: »li'j-L^I A?j t jjiliil Jj*


a---'JUcJi c^bJI jL^I *b-»^ aJ«u1I sjJ^j i}j^ \


%K. W: <5 ^*Jj^4i^Uw^c^


,y XT ‘VTMvMl ‘ H - t f Sa/jII ^l£o*l ii^*' --- Y S^U


v^l^l c^ljS f^t ^ Jdi/jll SM 6j!U(5>


. olS^JIj


. ajtJI -ax J-\ j jjSUl j& --- f SiU


\. V*\j* t>» d^UT jj£~j i ‘‘Oj-di fte OjiUJi lis.^


i (i\vr fc- \ t) \r*.r ^ '»ti* W:' «■*>» j. j4*


 :• >.


\\YT \t j (y?) XX *■*•!» -


• r»-





PETROLEUM AGREEMENT vLiri





BETWEEN


Government of Arab Republic of Egypt US-J


V _yJ1


4. -.■***;. i*jC.


and


Egyptian General Petroleum Corporation ‘ku 4o~>V -gi ■





| and


Transworld Petroleum Corporation











(





Tlua Agreement, made and entered into on this-- --------y c'JWl jl as


day of ------j" --- by and between the GOVERNMENT OF


THE ARAB REPUBLIC OF EGYPT (hereinafter referred to

ths “GOVERNMENT’), the EGYPTIAN GENERAL PETRO-


LKUM CORPORATION, a legal entity created by Law No. 161


of 1933, as amended, (hereinafter referred to as “EGPC”) and t> w a---jl.)55 JaiL Jtlci ’jy£fc;


TRANSWORLD PETROLEUM CORPORATION, a company J*.3 ) jj’UI Uij


organized and existing under the Laiv of U.S.A. (hereinafter re¬


ferred tr> as “TRANSWORLD”).





WITNESSETH .Jo* Jiol It. wax' A1-J VI


. „ WHEREAS, Law No. 66 of 1953, as amended, established


all raw materials, including petroleum existing in mines 0 a Jyry-\ tJjjJ) *-c.


Vftd cpjarries in AJEt-E., including the territorial waters, are the


property of .the State; and 1 . aU-lj > V J*11 .

WHEREAS, EGPC have applied for a concession for the ^ji u uyi w


exploration,'development and production of petroleum in and A^i\j ( V ) 1*UI j iakU j **&lj


throughout the area described in Article II and shown in Annex


‘ A”, which' is attached hereto and made a part hereof; and


WHEREAS, TRANSWORLI) agrees to undertake its obliga¬ jisA* J-l J,*.ss jt Je. 1/


tions provided hereinafter as a CONTRACTOR; and


. SJUrVl c^,


WHEREAS, the Government desires hereby to grant such ; L~.uU


concession; and


WHEREAS, the Minister of Petroleum and Mineral Wealth,


pursuant to tlie provisions of Law No. 86 of 1936, may enter into ee X----jM W (‘Ul Aio jje A---.#l*i (1)1 4..


a concession agreement with EGPC and TRANSWORLD as


contractor for the petroleum operations hi Sluikeir Marine area J j;y£ JjJ


hereinafter referred to. Juv ’ ‘ A, ^3;.- .


•AAi<


 *1" ■ .'-t'W&.-v ;:.w, v ..


••■; '•■*. ■ ■ '•• ■ ■ -mm


UYT^ \\ j (c>‘) tt ^


■ W '





.: • -v .•


Cow, ilier^oK; the parlios hereto ajret ;is follows : ^L > ^ 'JO’JI Oiil Ai ai>4|&





ARTICLE t ( oiU,| J


DEFINITIONS





‘‘Exploration” shall include such geological, geophysical,


•erial and otherjsurvys as may be appi-opciate in tlie judgc- * {\\ '


lem of the Operator au

ore hoh*>. -Irajigraphic tests, holes for the discover}' or S| jis-j i C.U**J1. frlsll jJJS *,_V


roductioti of petroleum and other holes and wells, and tJL t 3_>.Jl


I


ie purchase or acquisition of such supplies, materials and


-(uipmciit therefor, all as the Operator may dean to l>e t 0* til 1


sary and proper. The verb "explore” means the act kjCs* cA*{U IjSS


l'/-/,nclooiing exploration. ” '^3r ” t ■:1 ■ ■


V. .


1 tevidnpn>ent,,;«hull iitchicle tiie drilling, deepening, plugging . I* .Sr B


\j4 L A---j j jb VI ji>> c‘ M ’


.'ck. completing and equipping of such wells, the iusta'lu-


>n of such equipment, hues anil systems and the conducting -X*J ^jIAkII UjIAc^j j iJe-lj ,


f such other activities as. in the judgement of the Operator, \j}j _«is“ j -5f). LT-


■my be necessary, consistent with sou ml oil field and good


C'tnoiuic practices. . Califs f uny te':


"Producing'" shall include such activities iu the Arab •* * -C--


s**\Jjb’ JilisLiJI


'■‘public of Egypt, including the construction and use of cJiZ&Sj j (JtcCAy A*\»i

I ants and facilities, as may lx; necessary in the judgement


:* the Operator for producing aud operating the wells ^jLLJb ^cUHyAi* i £Z\f\J6". . r


rilled bp the Operator in the Area and for taking, saving. (jjJLIl jbA-Vj iakdl j oU-J'i f ^ .


.ting, handling, storing, repressuring, recycling and other 3^Wi j «A*4 j 4, ' ;|.


y'"Jarv recovery projects, flaring, transporting and deli- ijjllll 4 , , 4,


■ring petroleum.


. iekJj JA3 *0 jlljl~'


• Mtoleum” ,n«ans liquid erode oil of various densities,


C-JIj aSUTo^>'JSUI rW Oj&i


•lid petroleum such as asphalt, ozokerite, petroliferous





cks and petroleum shale, gus. casinghead gas and all other iljU g-'j jbJlj


.vlrocarbon substances that may be found in. and produced.


• otherwise obtained, and saved from the Area under this


sreetltent. ami all substances that may hr extracted there¬ JUC sjU)1^n*A» ^chASC iikil t3Ut> J


out. . f*\£ (_raUc-JAl





.iijuid crude oil" or "Crude. Oil" means any hydrocarbon J&l" fiw c-jlljtjfUl rU-M


winced from the Area which is in a litpiid state at the cr j] Aic3}_jj-JI aJU- j ASk.ll ' ^ ^


••lliiead or lease separator or which is extracted from the •l-'1 ■ , - ,_M .1.(1i'. '■..'■••'■■


s or casinghead gas in 8 plant. Such term includes dis- 3UI ^





l:.tc ami condensate.


 - * *1 v * ' '*&'■*,





u

2E4flt -x.cva ‘ ~'


■l” ie .natural gas °nJ all of its eonstitnant elements


sed from any well in the Area and all nonhydrocar* * -On ,v.; 4 iikii j


i substances therein. Said term shall include residue








(5) A “barrel shall consist of forty two (42) U.S. Gallons, liquid «!* *


y y V (It) Cgp'i u* {.}


measure, corrected to a temperature of sixty degree (60s) c 4 3^-^w-^v4v.v?5',?i!


Fahrenheit.


• '-*stv4* (v) 05-1 *>1*.


(h) ‘'Commercial Discover}” means a producing structure or


any other trap on which two wells have been drilled and U AS JT cJfej ul/» A? •**


each well has been subjected to a consecutive thirty (30) Op o\i i olV


day production test, conducted in accordance with sound


production practices, and verified by EGPC with the result 'iti* U* A---•’jll ^ i





that the sum of the average rate of production of each


t of the two wells during such test amounts to not less


than One Thousand Five Hundred (1500) barrels of oil per


day if produced from producing interval the top of which 5A*Jl^y


Hi is L - -*t " *


is located not more than One Thousand (1000) meters deep li* Z ■ i>* J *-*3^ y Jkv. (v*.* •) -


from the sea level, or One Thousand Nine Hundred (1900) w. }^Il jjU^ s* > 5-i^ 'pTSp -


barrels of oil per day if the top of dm producing interval J:V.(U**)‘A'-0 a**: w. v .. ■;a:.


is located below One Thousand (1000) meters from tire sea cfA> JpSailj a5 C-lS’lH-fA®- J ^


level but not more than Two Thousand (2000) meters deep


from the sea level. Or Two Thousand Two Hundred and o^\ y *yH> * y (>•••)


Fifty (2250) barrels of oil per day if the top of the producing Jl tV'yl t j*: 11 y ^ v.;


interval is located below Two Thousand (2000) meters from ells’'ji. *j,il j .l- y


the sea level, hut not more than Two Thousand Five Hundred


(2500) meters deep from tlu- sea level, or Two Thousand _a* (\ a • • ) *'«**“> o® Vy0\'t-


'Eight Hundred (2800) barrels of oil per day if the top y J^v (ya-0^1^ Jl c


of the producing interval is below Two Thousand Five 6* vi^l ^-u *“*'-> J :


\_, ; Hundred (2500) meters from the sea level.


The date of “Commercial Discover}” is the date on which ljUoS"f^y -a*(y®*


such wells were completed and tested according to the above. jl^l Jj: v k ^





(*) “A.R.E.” means ARAB REPUBLIC OF EGYPT.


| . L-.Cu|^




signed by EGPC, TRANSWORLD and the GOVERNMENT, “Aji.1 j (jli'il) )A* j-A U


is published in the A.R.E. Official Journal. \y ^yJi 0! -»---«. y^'1 y**


. et w tf-


(fr) “Year” means a period of twelve (12) mouths according to


the Gregorian Calendar.





(/) ‘‘Calendar Year” mean? the period from January 1 to y *\£A ^phcjil fry y


December 31, both inclusive, according to the Gregorian


Calendar.


r.VJjt


..?; a ■*


i > (-


1 ^ -


-'d'J w..i»r


 _ - m





•Tiuanctal Year" means the Government’s financial year & kyi vf-1'' M &ce » . i \\ ' .!


ii ig on January' 1st and ending on December 31st, both


*j being inclusive. * '


I


ax Year” means the period of twelve (12) months 'X.


r6 b*‘l u> 6- fcJI".(*-.)£


ding to the Gregorian Calendar fon which any income,


ts or other tax of the Government is assessable or 4»t f !/f- (ay)'


hie according to any applicable law, regulation or decree Vji. X* L | j| Jo'jt J? a--- aJ ^S, j'j/I Jo jt Ji-jJl Jo.


>o Co -emmeot. 0* jl 0_yli ^











emtor ’ means TRANS WORLD from the Effective Date j ^ 4v~V ^ ’ oWi r'iuiw (■£,)


11 Agreement until the expiration date of this Agreement


,-cnc'val- TRANSWORLD shall be referred to under ^VJbD.Ux^jl.ijUrNUp! ijlr JlUUtti


f ren.cm as cither TRANS WORLD or “Operator”. * * CAM, ^UB « 4^- „ Ul .





‘Affiliated Company” means a company t ,'i*


; XjX :5>F (v)


I'lie share capital, conferring majority of votes at


ochholders* meetings of such company, of which is ~r"~ u ;s> jm Ui-gjrt-ij


wnrd directly or indirectly by a party hereto;


: _jl iJlL'Vl *A* JJ? As-*J ■


Which is the owner directly or indirectly of share S? ^ ^U1 & «*<0 !


spital conferring a majority of votes at stockholders*


icelings of a party hereto ; or <•*“' jui„4r...y


: jl i-ijji





Xlio« share capital conferring a majority of votes of


•kholdcrs* meetings of such company and the share


• /il conferring a majority of votes at stockholders* . . .jus j


of a party hereto are owned directly or Dj-r^ ^ 6^' j oi^rviV.


“.directly hyithe same company.





'


ARTICLE n (Vuiaut) ... •!• •- - /£v


• ,.^;.c5pr^


ANNEXES TO THE AGREEMENT <5U;V1 "'T;' v





iuncles “A” and “B” to this Agreement are hereby ■ \KU«S Ji - - j


‘ itc-cof, and tliev shall be considered ns having equal


effect with the provisions of this Agreement.


‘A" is a description of the area covered and affected


greement, hereinafter referred to as the “Area”.


* “B” is a map on a scale of 1 : 100,000,indicating the


•<:d : ad affected by this Agreement end described in


' / 0**!il j V***y * iUfVl oi* 7 >;


 \




ji, O■***; } jAA-, : :*.2*vtoy.


• •• *.v .-i t


'■ .'*?' Arihfa “G” id a Lfetiet of Gfctifdlit£fe dtily aiitilbf&ed and


' issued hyi an approved Egyptian Bank for the sum of One Million


One'Hun^red and Twenty Five Thousand (1,125,000) U.S. Dollars SJbd!


guaranteeing the execution of die, eipforatioii prograin for the


initial exploration period. Stich Letter of Guarantee shall be


submitted to EGPC within fifteen (IS) days commencing from «Jk» j 4 As 3^A«U Jj/jjy.ij


the date od which TRANSWORLD is notified that die Minister


of Petroleum and Mineral Wealth is authorised to sign this


Agreement and such Letter of Guarantee shall remain effective

for six months after die end of the first year.


i


Annex D" is the accounting procedure referred to in


Article XL (UbllSiUl)








ARTICLE IH


GRANT OF RIGHTS AND TERM


sj_Uj 3j---«fl





The Government hereby grants EGPC and TRANSWORLD X


JjJUl <*UI i> sAa i*jSCL^


as a contractor, subject to the terms, covenants and conditions set iskll


out in «hfs Agreement which insofar as they may contradict with li'il °A2> j AiiA)


ary provision of Law No.66 of 1953, as amended, shall have the


force of law, ad exclusive concession in atad to the Area as { ' ' ' )


follows :





(а) The Government shall own and he entitled as hereinafter If” *>1*1 A** ^


provided, to a royalty' as provided for in Article V (a) jJU-1 j Jrl Ji U* {\ ^ oio-MS&j* ~:


in cash or in kind of Twelve and One-Half (12.5%) percent V"^>^a*(V.4YVr)


of the total quantity of petroleum produced and saved from


the Area durirlg the development period including renewal. »A» ij w{


Said royalty shall he home and paid by EGFC.


(б) An exploration period of four (4) years shall start from -v ■&/,


ii\ j* 'aJ* o*W o'>*■ ( i ) « j\ c^=Ji 5^, • ^W1«*


the Effective Date. The Agreement shall be terminated if


no Commercial Discovery is established hy the end of the l ^ ajUtVI j


fourth year of the exploration period. . i^sJS SiX^) o\>X-


(c) A development period for fifteen (15) years shall start from Ai-» ^ \ 0 j Syifr


i


the date of Commercial Discovery, when the whole Area shall


I 'UVyjl ‘


he converted into the exploitation lease without the issuance


of any additional legal instrument or permission. Development


operations shall immediately he started by the Operator and Agwdl lx. ol


at least one drilling rig shall he used continuously till the 1^-^ A-ir p lj-C---X


field is fully developed. In the event no commercial produc¬ tai iM\ j.'xju? oix.vU^i j&'p'


tion of petroleum is established in the Area ns indicated gjv U- ( V) ^ Vbil SiU.1


under Article Xtwithin three (3) years frotn the date , oLu*)\, ^-U)l Jp. j


of Commercial .Discovery, the Area shall be surrendered.


The development period may bci renewed for an additional £** (^1 * y J^s' *a1>


period of ten (10) yean at the option of TRANSWORLD. ,


 fBANSWORL]) shall carry the risk of all the costs and ..... « : •,>/.


'tpenses required in earning out all the operations under IX «A* s~flj-*aU*


'>iis Agreement and therefore have an economic interest in


devcUtpnw ut of the petroleum deposits in the Area. , tikii JjlXl (} a-vl-r^rl


■ 'di co.-ts and | expenses shall he recoverable as provided


■ Article V. During the term of this Agreement and its JiaXfj)i'Sj 3.iIe"VI oA* a-U


nen al die total production achieved in the conduct of sod)


ueratiotu shall he divided between EGPC and TRANS-


ORLD in accordance witH the provisions of Article V.


i v *4^^! 0* fjjv H^f


RANSWORLD ahull he exempted from the income tax


id all other taxes in the A.R.E. except purchase taxes


eluded in prices of purchases in the local market, and JkUV_/*» IAS IpSYiUijCA-jJI


■tics paid to the Government for actual services rendered. 4,c^s_0L\ i l3y**^ (j-* jjS J


r -





ARTICLE IV (laJJIfaUl)


KfctftK PROGRAM. EXPENDITURES AND MANAGEMENT


OF OPERATION ^UUjJI (J-Ji ■


RANSWORLD shall commence exploration operations *UtiljJijUr^la-A.raly-iM w.saJl si»Uf


rounder cot later than six (6) months after the Effective


ite. Not later than the end of the ninth (9) month after lxZj 4-»UrVl (1)1^ jf£ 1 ^ ^ ^ c-> . -


e Effective Date, TRANSWORLD shall start offshore iy-T-1 eUiiit JjyluU j tfjOeJl , ;V


ploration drilling in the Area, and the drilling shall J>e


ntinued till the end of the exploration period. • 3A> A<\{* (_il jiM j■»*...'j jX ^1


'RAN5WORLD shall spend a minimum of One Million ij6- VI Jl j i^pcJI Jo J*L (- vijijAy


ie Hundred and Twenty Five Thousand fl.125.000) U.S.


dlara on exploration in the first year and shall spend One ,j» ( \\Yo* • ♦ ) *l»y- ;V


i lliort Five Hundred Thousand (1,500.000) U.S. Dollars in 4ilc---IfjA* ji-j t O^^Vl i-Vcidll oXVjJI


'i of the second, third and fourth years of the exploration ijf JST J S-Wil Cx“ ( 1 ® * * * * * r'-.


i


s • • * . ii» oU- .yWW* .


' the expenditure hv TRANSWORLD in any year after the


Ai-Jl Aw K~* it J UjLXi* r’']X0^'^'


«t year hereinabove referred to shall be less than the


. i aunts specified for such year TRANSWORLD sltall be 6¥ sLjuw *uM £S\y>


• ligated to expend the deficiency of such expenditures *i-Jl cli'^1 U» j J>cijl jlAi* V?U


ring the next succeeding year. In the event that the ---H (j* <-*■ j] Zj

oenditure in any period or year hereinabove referred to


ill be in excess of the amounts specified for such year, A* t 5xJl dW jaM xy U»T Sj/’aX)


h excess shall be credited against the expenditure oblige* ti (j1* ■ ■■ ;■


ns of TRA NS WORLD for any succeeding year or years.


. VI’


Sit case TRANS WORLD surrenders its obligations in this


j . * 13|U ajU* jj -


reement before or at the end of the first year of the • •<••••


deration period or before or at the end of any succeeding


ir and TRANSWORLD did not spend the amount


-cified above for each year by the end of such year in Iji tifcU-.jft 3^fi a»C‘‘ jj


■ich the surrender has .beat made on exploration in the


sa, an amount equal to the deficiency dull be. paid by


'ANS WORLD to EGFC at the tune of surrendering. ♦ tfjlji UL» Jidl





 1 S'kY'C' \A




% "J


(c) At least three (3) months prior to the helming of each sAr- •**k- w


* W fi i&j&y at. such othertimes.as otherwise mutually agreed by


" W gE^C^d ;TRANSWORLD, ^ TRANSWORLD shall prepare


%ind. 'sidija«it for approval of EGPCa . Work Program and


^Budget for the Area setting forth the Petroleum Operations


which TRANSWORI-D proposes to carry cat daring the tk J >i &t,[ . yuLj'j^ ^ ’ -


|e*r. ' The aforementioned Work Program may he


revised and/or modified in case of need with die approval S Jll ^\}\ ^ lii

of EGPC-


I ■%


| ♦ cJ^\ liftjtj js


(d) TRANSWORLD shall advance all necessary funds and


purchase all equipment and supplies required to JdU'Jl jf Ujlj--


be purchased or contracted For exportation, development, y*jyi oU & ^j_h ^


producing and other petroleum opera tionfc pursuant to die


Work Program and EGPC shall not he responsible, hear V---b£iHj i ;


or repay' any of aforesaid costs. . yi jiiii o'


i.


'l Operator shall he responsible for the preparation and execu-


tion of die Work Program which shall he implemented in £ ur* l* etUXJI £a ji 2°\ ^ $


1 V./a woik-m aril ike manner and consistent with good industry


practices.


TRANSWORLD shall entrust the management of Operat- Jl^sj jJI j


ions in A.R.E. to its technically competent general manager. ijisirni 4 ^


On Commercial Discovery, TRANS WORLD and EGPC shall


appoint an Operating Committee of six members, three of


them to be designated by each Party. vV o' 6_>_r^ ^ 5----J.U Jl»

The Chairman of the Operating Committee, who shall y jie Uu]


also be a Managing Director, shall be designated by EGPC. wJCw* j* 1


The General Manager, who shall also be a Managing Director OjVj--- aoau ^ visjij::..'., y'


and Chief Executive of die Committee shall be designated by


TRANSWORLD. The Operating Committee shall have the


authority and responsibility in executing all matters con¬ , iJlA'Ifl oJ* AjftJj -


cerning thi9 Agreement. In case of differences which cannot


be mutually settled, the matter shall be .referred to the JU. 4.U jJw i^l J fj*) aJU jy ; l;


two Parties.


- i


O j ** (U & \v ti ^ ^


(J) Operatorjshall supply EGPC at the end of every quarter


with a fist of costs incurred and proceeds received by the


Operator during such quarter, and necessary supporting Oj-nU 'Jf*';


documents to he available for inspection hy EGPC at any oi*U 2k- cJj Ji j


time during regular working hours. Within three (3) months


from thf date of receiving each list, EGPC shall advise . AoWI ■. v j


the Operator in writing if it considers (a) that die record <&i- j V? olJUh


of costa and/or proceeds are not correct, {]■>) that the cost cimilU iutt ^^&& &jrJ\


of goodsjor services supplied are not in line with the intema-


tional market prices for goods or services supplied, provid¬ jM * &zsk*j£\ yUUAJJ&r :n


ed however that purchases made and services performed


within the A.R.E. shall he subject to Article XX3DTI, or (c) 6^> Oijj -ti cX■ ;


that the condition of tbe materials furnished by the Operator f j\ oWl


tines not; tally with their estimated prices.* or (d) that the


A'.JJ-*3', :,0* ' ' ' '


 . vj■■■ ••.-r-r •





IB


WYT U.




I f iheerrcd ire nor required for operations. Operator rU!1 jn A\j.\ i>U c)


•U confer with EGPC hr connection with the problem J t u s>jau >U----Vl c cAUV -B®t4


;i presented and parties shall attempt to reach a settle- otolAujl^rlitl Joj. oU**JR*jV i J * *$;m


nt-which is ^mutually satisfactory. If within the time





•it of tlie three (3) months period provided for in this t5j „ 01 vl'sjjl ds^;. i


agraph, EGI^C has not advised t!nj Operator of its ob- Jr^ -if* 0 ^ Uj U ; r^r


ion to any li^t, such list shall be considered as approved. "*• jeUP- jUti-V v^Aa. j


jrljS jj-Jv c»ts»W o'


Commercial | Discovery, settlement of all expenditures . JJ^


1 be the responsibility of the general manager aild the , cAj_/Al 0® .v ,v


ntv general manager, with the right of EGPC to audit


expenditures in accordance with paragraph (f) of this • * \«. ■•sVv**rV'’^'


V. t U o-ta 0* ^ V-v.- j^s>'i"i


iIVS'ft'ORLD shall supply from abroad all funds heces- JS*jJtiil VIli o5A» 0* ■


• for the operations under this Agreement in freely con- V^1*' USj s-^f* Ail^U .


lhle currency and whenever they require payment in


p'.ian currency the conversion shall be made at the i-hil *jjijj (j ^Jt_ jpftjl 0^.* 1 . '■


1 banks in A.R.E. according to A.R.E. regulations.


4 _T^ V-***". vvV^' ir'


ARTICLE V


(U-IUIsaUI) - ' ,


RECOVERY OP COSTS AND EXPENSES


AN5WORLD shall recover all costs and expenses appro- O* Ai!^ ijuti


by EGPC as stipulated in paragraphs (0 and (g) of V^'^1 A* jJI OwUJUilTV.;' :--


'dc TV above in respect of all the operations under this


-cement, to the extent and oat of an amount not ex* O' ( j) J ( j ) J && A* ^ ^


linz, whatsoever, an amonnt equal in value to JS|^ jlU ^ USTli/jil ":K:^


. 'rnrnrnimasmsmmmmmi


1^,-Tinder and not used in petroleum operations, and is**. ^ \ ***> ;; S





*rr> deducting Government .royalty. Subject to the above JjjUl O J«)l AjliiVI


■entage, recovery of exploration expenditures shall ul* t ii!U Ai^1! 3_itl . \*J>sX-\ Sjt'l '


in period iof five years and development and produc- * :.....»iM


expenditnres in a period of ten years. The recovery


both exploration, development and prodneing expendi- <---O' . :?'.';••/£


• shall be evenly distributed over the above periods,


vevrr if TRANSWORLD is unable to recover such ex- , 3iiUjJAl tejj*


dftures at a rate not exceeding twenty (20) percent per it vV


am of total exploration expenditures for|ten (10) percent 0* 1j ("/,Y OO^J^Of


otal development and producing expenditures, each per- £>4o* (*'/. i


shall Ke extended for such time as to permit recovery at


■o rates, Development expenditures (Article 1 fb)’ )


'1 Inclnda all production facilities and plants. Other i&b


aining expenses shall be recoveted in the ^ear incurred.





 J' ^;gf|





^SSlOTSWORLD dtall take each year forty (4Q%) per-


_^^of:jan|:ettta©:oil produced plus its -ehareasptipulated in


pcaph p»)’~of «V»* ArtkJji V and shall pay to EGPC within


uiij' (60) day* ton the «d of anoh year ip cuh tod in U.S.


Dollars, the' difference between the value of the oil received


and the actual operating costs at the end of the year.,


Exploration, Development or Production cost shall only








.^include ez]>eQdi£uxe9 incurred in the execution of operations jjs gif


*' «nd shall not include interest on investment.


(b) Of the remaining 6ixty (60) percent of crude oil, EGPC aim -J J o* A---g**


shall J>e entitled to take and receive seventy five (75) per-


1 cent add TRANS WORLD shall he entitled to take and re- 0*. (


i


ceive twenty fire (25) percent, provided that the averaged


daily production of sixty (60) consecutive days readies fifty (^jJI ^ j) eJ_f jil ^ I' Y# ).


thousand (50,000) barrels of crude oil per day. However, (a**** J v)


/' ' in du; event that the averaged daily production of sixty sjl Je ; L»_p_ d---Vvir*j'-"'.


V... |


(60) consecutive days is less than fifty thousand (50,000) bar¬ Jfii At'-A'-* '


rels «| crude oQ per day, the above referred share shall


he seventy two and one-half (72£) percent to EGPC and l>jlAi> A---C*»


twenty seven and one-half (27.5) percent to TRANSWORLD. AA>£---i\ f VYjO^ ij t_indjy :





It is agreed that once the average daily production of Cf A£lJK^r‘ Wji-Xi- ,


sixty (60) consecutive days reaches fifty thousand (50,000) iSyJl Ja-gil jl Ail AJc gi^l-


barrels of crude oil, the share of EGPC (75%) and TRANS- ,j* ( 0* • • * Vji(v)C£*-^Ai


WORLD (25%) shall remain in effect throughout the dura¬ V-w ^1(7 Va) aIHI iv> fU*V.C*^V ;


tion of the Agreement and any renewal.


Jaf J?(7.To)^


Ait _}\ AjUi^l aAr> eL»jlJo Ai jUJi Aj---j‘.





AiX^lA A_5 A»-i


(c) For purposes of evaluating the quantity of crude oil deli*


vered to TRANSWORLD during each six-month period to J. oUyl(y_vi 1 *Z-* ,


recover operating cost, the weighted average price realized


in free convertible currency by either EGPC or TRANS* 'Vi A.£>.\ '•^JaV-./Aip'y


WORLD, whichever higher, to nona/filiated companies jM


during such six (6) months shall he used. It should,


however, be clearly understood that such price may be lj> JU (it (j* Ail ^e-


adjusted if necessary after giving due consideration to des¬


tination, .


. <3 4g*-y|i Ai»l> ^'Jl lij





( v.





and freely export its share of crude oil under para¬


graph (b) of this Article v, as well as the forty (40%) j.U-1 C->jl - j* (• ■/.4' "1


percent of the crude oil to recover the operating cost.


The value of any excess quantity over that actually jl AL- J-i-Ll A^aadV ■.


entitled to TRANSWORLD shall he paid in cash to


EGPC by TRANSWORLD within sixty (60) days from AjJaaII A_i(J! jje. ail)j xS" ^1 i*_V


the end of such year. . k-’JS' \Vlt* 'uJI. 05- k





 \\Yr ^ o-k-ii \t j (^.t) YT ^ ~-V--r1'





' ;; «a6r'.-


jr *M? A-m»JU ij» J£J jjj£ •--- Y.'i


KGPC and TRANSWORLD may freely export their res¬


pective shares of crude oil and gas from die AJt£. & jUlj *U:| c-JI ^' 31


without the necessity of a licence or other special fj-Jl 6V*"' JG‘ yT“W J u^Sdl


formalities, and all such exports shall be exempt from ,%X


customs duties and export taxes. . jr-uaJI


j-5.'


colstit


s and its constituents, unless TfiAKS^OBlD exports ^ k 5----jl! l> tfjl* il!jSC-j jU!l jjih ^ - ■


portiou or uses it in the petrolefcm operation within iakJ.1 J ^,UwJI (A j| 4i* j-1 V*


> Area, shall i miain entirely owned by EGPC. TRANS-


)1(U) dudl b i entitled to export its sluire of the gas . * JiiAl jUIl l^aj (ji-l jJjj-iljJ jjC j> '


ed. - *• ^ ■ ' *. /:>'*<





5-rj5»Si-;jj'i,|j.jp (j) y


* Operator shall prepare, not less dirn ninety (90) days


or to-die beginning of each calendar semester follo- (■&} ■*"; jl^A^t^'l e-h -A* 1*JJ ^


ig a regular production, and furnish in writing to EGPC


•--“cast setting out the total quantity of petroleum that tjjjl .


it erator estimates can be produced, saved and trans¬ SJUrlM IglZj Ij. J;U:j.VIj


it hereunder during such calendar semester in accor- \Zj ;j/’aU ijl




11 nslo estimate tile quantity of oil to be takeu by TRAN- »/ji£ J ot c»U*Jlj fUJl . JjjJI J


OI:LD within the above mentioned forty (-10%) per-


t adequate for repayment of operating expenses and cAuJi sjUi.v bjZ uu ijj| jUii


* estimates of TRANSWORLD and EGPC shares. The


•ra tor shall endeavour to produce each calender semester ji-UJI Jcj . *---Jllj •Jjj-il/JT UhJj-toj 't .


•cast quantity. The crude oil shall be run to storage


constructed, maintained and operated by die Opera- r l-f. Udl #4g>- Ji- ^ ^lUJt - •'


a> cording to Goveniment regulations, in which said Cjy'I jy: ji-C jii Ai» JCJ

le oil shall he measured for royalty as provided for


Article V (a) and other purposes. r^lA3-^. (U





^ ( oj3jLJ,I(f" 5jli‘Vi <_jI---








s ARTICLE VI (3-oUl :jUi )


v_. EGPC’S TITLE TO ASSETS








C shall he the owner of all Assets created or used in y Ai-Aai*1|jX>U1 -S3U A-»*^L 10'ft-{'.


ection with the Operations carried out by the Opera- • (ji ^ tiUij oLU-Jl ^lil[ 1^. ■


in accordance with the following :





r.awd and fixed assets shall become the property of A=-bJl ^lj'^1 --- \


EGPC as soon as they are acquired. ■ IfJfi jj,^





* .f;i


Movable Assets assigned tQ^the^pcrfonuance of this •|^;^UU-VUaJLiJ ;; :


Agreement «h^ll b^omelefalj^^feijK-th .'W'liai they


ate twsd for/ petroleum operations gn^'jjpgnianqit


manner or pa>5^ deprec!atc

should tben: be charged to tbe operations and is to


lie recovered by TRANSWORLD as outlined ‘ in


Article V.


 ) rr ^





,'^Tl4#table Assets t»aed only temporarily and not folly 1W4PK, SS^ fVeJji


?3ro&cwt6d'ahall remain the property of TRANS- ■ *lr *. «W.i j-A Vu jts J.1S31 a


' f WOfilA prondnl tlut EGPC’s approval is obtained ** u-L1 > 4>^i fi^-i it_i ogi"


v-i •';•"• ••'■-' ’.• . . ' , ~1 y.


in respect/of their uses on a temporary basts and that ^yu>v^w*iy^f’p


. only 'their.'depreciation for the given period is charged


" to the operations and indoded in the cost. It is nn> oo 1 -ysa -sv-si u_. Ji. Jii/iif®


; ■ derstood that aoch temporarily used assets may be freely <*? oU-ll r*u g


reexporjted by the Operator subject to EGPC approval, •y 4j4 ^ W> U-. "JI :&$£





. The book value of the Assets created daring each *---jMJrtcji, , Jili > i_jU \ 'Jr':


calcnda? year shall he communicated to EGPC by the ^ f & ^5“ i-3^1 M'. k- Jr


end of each quarter. • Vsus-jrj*.





;b) During die tenn of this Agreement and its renewal die Jst Jiuc yiirvi a. i


Operator iaj entitled to fall use, in the Agreement Area, of


all fixed and movable assets as defined above and EGPC JUk- ‘Wa.i»,»u,-* o


shall not dispose of the same except with mutual agree.


1 \ .cnt





ARTICLE VH (i-UlfcLH)


COMPENSATION FOR DATA


TRANSWORLD shall pay EGPC is compensation for seis. ('ra ■ * •) ^^ ¥3





uic and well infomadon concerning the Area now held by **** w-il olVjR


JGPC and to he passed on to TRANSWORLD, die sum of One ^ ^ V1^1 &.j* ** & Uj,’ /r:;y l?\


fundred and Twenty Five Thousand (125,000) U.S. Dollars


vitliiu tliirty (30) days after the Effective Date. Hie afore. u^: UU u.jli otLj LjJi


«id amount shall be included as a part of the minimum ut^uu ^ Jifjou


xploration expenditure for the first year of the exploration


criod.





,<■ ARTICLE V3U (iubJlsjU.1)





OFFICE AND SERVICE OF NOTICE ob^V' jsfrb





TKANSWORLD shall maintain an office in the A.R.E. at . li* til CL.j! 13[


liicli notices shall be Talidly served.





The general manager and deputy general manager shall be fU fUI ^ ^ ^ ^ ., v


•trusted by TRANSWORLD with sufficient power to carry ^ SjiUI ^ 61^3,


• t immediately and comply with all local written directions -^VUrVia-^V Wj yiA.W>Vb


ven to him bf the Government or its representatives under


m> terms of this Agreement or any lawful regulations issued uj^ ^3^- a- ^ y**


hereafter to be issued which are applicable hereunder.


I


All matters shall be deemed to be validly served which are j/*aM j--


ft at such office or which are sent there to by registered mail.


I


i.


 ' ;: i.'"'





-W v\ 'ci <$*> XX *&


' .'S''■











AimCLE IX (U.WI SjUI)





WlNfi or petroleum and prevention of loss *jJj ijjjJ Je. b





• 1


If* .


he Operator jshall take ail proper«uoasures, according to J*-.:


-A* c1 0*A* si vdlj ^ - ' f -X-


c;;eraily accepted methods in use in the oil industry to


revcnt loss dr waste of petroleum above or under the


round in any form during drilling, producing, gather- ►til i+j *ft Jo C-»£ j\ 4 ■ ^-C;;


ig anti distributing or storage operation* and including ijUi-M *iSi j k CU^J


ronomic loss j resulting from insufficient production or jiJ'

-ausportation | facilities. The Government has the right


• prevent any; operations .on any well that it might rcasona- *ja4-1 j c-ai/ lil Ji *1 j ^_|


.v expect would result in loss or damage to die well or


oQ field. I (Jli- jt jji jtSjUi J,[ Jj ^








pon completion of die drilling of a productive well, bja.\M\, oU~n (fun





aerator shalliinfonn the Government or its representative ^ tf-at Ac^l ^ '•


the time wtan die well will be tested and tbe production


te ascertained. * Cr;:'1/





<;ept in instates where multiple producing formations in gt^usvi & \gi $*** $


r, same well can only he produced economically through


-ingle tvihing string, petroleum shall not he produced from,


altiplc oil carrying zones through one string of tubing j. Jyjhil £^1 jj* V jwl^ v;-',..,:


the same time, except with prior approval of the Govern- A*b ti ->*b^ •A'-b Ar*'* JW-\ c-'^B


-at or its representative.


. l*fc£ j\ X»gL\ 3iL. aSsIj. Jp \ xo V\ , ;:':








perator shall record data regarding the quantities of JjjUl 3jf* £*> c*VU oLtwjL jvUlf J« \


^ ..‘am and water produced monthly from cadi develop*


nt lease- Such data shall be sent to the Government oHU aoa J-JJ i/ osc JTo* Jft r':; _. ;


its representative on the special forms provided for that J>j# Ui


rpose within thirty (30) days after it is obtained. Daily oAa Jo J>uA-l ij* bu ( f* } J^U- J iilib-4^


weekly statistics regarding die production from d:e Area V^r-V* U U


:11 be available at all reasonable times for examination \f^peJbj UilAol


uudioriaed representatives of die Government. • cAb*^ jj*











ly drilling records and die graphic logs of wells must jih| ^ ) :^:


,w die quantity and type of cement and die amount of


/ other materials Used in the well for the purposes of W J 'O^il oli-UiUJ ......


liccting petroleum gas hearing or fresh water strata.


>>: used for separating water hearing strata in the well wUje'l Jwii! ^ ;•


separating the petroleum hearing strata shall not be


didrnwn without the written approval of the Government M V Ujtjyi "4-UU


its representative. , jt i*a* J° ‘b’ai-l O.o -rM0^





 WYT i- o±-S\ \\ (i







ARTICLE X (s/UISaUI)


>: fv CUSTOMS EXEMPTIONS •. .-Vf-'v


'•i. *t*, :-\Sis3ci:


a) EGPC, TRANSWORLD and their contractors and sub¬ j* cAtf b pJjU&j


contractors engaged in carrying on operations tinder this


Agreement shall be permitted to import, and shall he f cIji" j t


exempted from customs duties,^witli respect to the importa¬


tion of machinery, equipment, .vehicles, materials, supplies, £J\j obl^b AljUj oIjUIa


consumable items and movable property, when certified by


a responsible representative of EGPC to be for the solely in Ui At wU.v«!l jC-\ 7 vV


carrying on operations under this Agreement.











>) The expatriate employees of TRANSWORLD and the said jUibcAMb-^>£ \J ^(v


contractors and sub-contractors shall be permitted to import


' f .d shall be exempt from all customs duties with respect A~*Vb -AAb vi.UfVl if ;


to the reasonable importation of household goods, items


and personal effects including one automobile; provided, bj*-', ol “ A»?-A ) t SAe-b ti b '


however, that such properties are imported for the sole


use of the employee and his family and provided, further, tj-], '{f t Aj---b ‘-AtjS «.L-Vl «A* ■


that no! such property imported by the employee shall be (£,~ £-) b a»j« U iV... :■


resold hy him in the A.R.E. only subject to Government


regulations. - I,, ^jil j


•-•) The exemption provided hi (a) of this Article shall not ULU y* \w ijk'C\ j ij\J\





apply to any imported items, when items of the same, or j\ U* »*l4u iio.*


substantially the same, kind and quality axe manufactured


locally and are available for purchase and delivery in the _r^ \ j'-3; ( ^ ^ • ^♦*^*'b .v


A.R.E. at a price not higher than 10% more titan the cost


of the imported item J>efore customs duties, hut after jjy---


transportation and insurance costs have been added. - o^k-b wJ’SC; Ailil, £* y-


*•] ..uy of die items imported iulo the A.K.E. either exempt


-A or non-exempt from customs duties, charges and taxes under 0-.CP-1 ‘b-\ f ■ ^ ^)J1 C’,-i


tliis Article may he exported by the importing party at A»j l.fjl-\ *j*J\ £ 'ft'


any time without the payment of any export duty, charge jy& i SjU.1 »A»


or tax.


*UC^ J>\ r*J ^ Aft ^





?) Scrap and used material, equipment, macliinery and cij^'i


imported goods resulting from operations hereunder may b*r jy3? Ailtf'jl oA_a 9-j+s Cf ;.


be sold within the A.R.E. provided that the purchasers pay


die applicable customs duties, if any, except, if sold to an


affiliated company of EGPC.





0 “Customs duties" as used hereiu, shall include all ad valorem A-s'i'Vl oi* J y> ^ ^


taxes and importation charges and other taxes (except those


paid to the Government for actual services rendered) which v^b-ib^Nl p-jy


are payable as a result of the importation of the item or { Citjt aJ*» wUjvp- __/i; '^, 'y Jl UJlSi


items under consideration.





l ..'.I-Vcf*1 ?





 wr^




• ARTICLE XI (la,sL>-\ IsU-l)


[ BOOKS OF ACCOUNT


ACCOUNTING AND PAYMENTS S;J,U1 oUf- ; o'il-W


i


i /» ^S) J_,ju ^


I’C ami TljtAiVS’R'QRLD f!ui1! cadi maintain at their


iu business offices in the A.R.E- hooks of accounts, in ( f- * £,) IgLP '*J&» A Ja5s^y;-■■"'7x.~:=5’


•ordonce, with the accounting procedure attached to the


reeoient as Annex “IF and accepted accounting practices ,i ylo xu, Lu~\ JaJlj iiurtft jiff;|


lerally ueed| in the petroleum industry, and such oilier


is aad records as may he necessary to show tlie work Jl c^UJ) Jjf&jMlliLaf dljfj t jl


formed under tin's Agreement, including die amount ^ ‘ ois J y|l|


( value of oil petroleum produced and saved herouuder. Uli'VUL^fc * JUuMs ^11 JjjcJ jftJ,


ANSWORLD shall keep its hooks of account and accouu- VJl S^\ W- oVj 1


; records hereof in the t'uiiod Slate* of America Dollars. • 5A»d\ oVsl_/vULl\^Ui* ,


' Operator sliall furnish lo the Government or its


•.native monthly returns showing the amount of \j?'* oliL oUwU fUl)


roJeuB) produced and saved hereunder. Such returns fjUjjyi


il he prepared in the form required hy the Government -UkS XZj 0t\J ^ a\t,


its representative and shall he signed |>y the general


lager, or lly the deputy general manager or the duly


igualcd deputy, and delivered to the Government or its


resemativo within thirty (30) days after the end of the


ont/i covered in tlie return. ---


: ) ■





• afmc&aid books of accounts and other hooks and V^tiJ J w« op ^ 5j/aU


> 'd» referred to above shall he available at all reasonable


m for inspection by duly authorized representative of


Government ‘ -








eraior shall submit to EGPC a Balance Shoot of


C ralcmlar year not later than March 31 of the following


to show iu net profit or loss from tlie petroleum


■allow under this Agreement for such year.








ARTICLE XU • * ,t -i*. »-«•'•!. •


RECORDS, REPORTS AND INSPECTION








Operator shall prepare and, ut all times while this


M&j oLUl (?U1


-ctncM is in force, maintain accurate and current records \j\L\ ol;UJi V* A.4T'oliyVl £*• j


s operations in the Area hereunder. The Operator shall


isli the Government or its representative, in conformity jf\d\ ike»t


applicable regulations or as tlie Government or its cJb UTjl oU4 U»j


'.•scmative'inay reaiouably rocfuire, isformitioit and data u^liU^ oU>u 'XfAXl jjaM j


.*m'mg its operation* under this Agreement.


 \\vr <1- \\ J (jj ' Lji _ w-jii wa ------





(b) Hie Operator shall save and keep for a reasonable period


- of <""■* a representative portion of eacli sample of cores and


cuttings taken from drilling wells, to he disposed of or


forwarded to the Government or its representative in the


manner directed by the Government. All samples acquired ^^ u\jj


by the Operator for its own purposes shall be considered 5*~>« Un Ai>v wj*'


available for inspection at.any reasonable time by the


Government or its representative. Any such samples which * *>M r» **


the Operator has kept for a period of twelve (12) months


without receipt by the Operator of instructions to forward ■s!l J-s ut jjl Ijr1 ( '* i -f”*


them to the Government or ha representative or elsewhere


may be disposed of by the Operator at its discretion. • <£ju ^ ' f-


(c) In case of exporting any rock samples outride A.R.E. then


• * ^»‘S ’ft


samples equivalent in oze and quality shall, before such O'*-. 4A


exportation, be delivered to EGPC as representative of the


Government.





(d) Original of records can only be exported with the permission t* VU- j UjU* ^ (t, * f • , , uj:


of jEGPC;. provided, however, that magnetic tapes and


any other data which must he processed or analysed outside


the A.RE- may be exported if a monitor or a comparable


record is maintained in the A.R.E. and provided that such


exports Bhall be repatriated to A.R.E. on the understanding


that they belong to EGPC.


CH jl jl AJiS u** j





(c) The Operator shall permit EGPC through Operator’s duly


authorized representative or employees and at ECPCs sole LjU, V/-V i. ,


cost, expense and risk, to have full and complete access to


the Area at all reasonable times with the right to observe the .A' - VVU j iSk-u^a.i!r'


r operations bring conducted and to inspect all assets, records ^


aod data kept by the Operator. EGPC, in exercising its Wjll . cAJUJU ?* k. V*


rights under the preceding sentence of this paragraph (e), •i* u- Uii -4M


shall not interfere with the Operator’s operations. The . oU.Jl, Attl0ue j


Operator shall provide EGPC with copies of any and all ^ ***&$&


data (including, but sot limited to, geological and geophysi¬


cal reports, samples, logs and well surveys), information and VrijJ-l > iy-a- V


interpretation of such data and information‘in the Operator's (vwu,A» ^ WS*


possession. All such data and information shall be strictly


confidential and shall not be divulged by EGPC except to v* oU>A\, c*yi f


affiliated companies, or by the Government, without the w y'l---jl) Ck J. ‘ .


consent of TRANSWORLD while the Agreement remains ^A- i»v. •* v*3-' cA.‘ A i


in force. However, for the purposes of obtaining new offers,


the Government may show any other party certain data JV, Vpit > i U«i


with respect lo the areas adjacent to liie ure« of such n*w > AT J> j g|H .‘W*


offer- • ^ bM- ^yi.'





v\


** s/Sf=


 WYT e)1^-1** (i (VT “ V-J'





ARTICLE X1U jiiji & jSjyJb'


^ILITY OF TRAHfSWORLD FOR DAMAGES


TO TiURD^PARTlES


J . ^ jdJislf ty&A VyW iJjt-M


jU entirely and solely be responsible in law


parties for any damage caused by its operations Cf -Ulej lr_ fji J\ Cf i*tOe


aiuify the Government against all damages for


>e held liable on account of any such operations.


ARTICILE XIV ^ ijLil )


ES OF GOVERNMENT REPRESENTATIVES V/Lj-IJ^oUlr4'





ietl representalives'of the Government shall have (jUsj Jl j ji-1 U.** ^


Area covered jbytliis Agreement and to the V* y lily '4^ *'"U JjlUrtil


lucted thereon.’ Stick representatives may examine dljjJlJj a_yjll 3 JWl Iit


stem and records'of EGPC and TRANS WORLD


"asonable number-of survey, drawings and tests VU\ oUf1


• ‘ enforcing; this Agreement. They shall, for ot jty ajJ> i}Ja } c


entitled !to make reasonable use of the


'uaramenU of the Operator on tlie condition Cj'jaVIj oLT LI i





or impediment to,;the operations hereunder shall t$|«ji _jl;^L* sia* ^ it


>r indirectly froni^ such use. The. Government


\ -hall reimbuipc ..Operator for any loss or damage Wb_/j oLLJl, (c\sll L*(J* jt Jixi-


Let result fropt any such use of said machinery oLT'L.M till/ a*-3,‘ i---i* jt A*.i


Such representatives shall be given reasonable


e agents and employees of the Operator so that CjIAcI---M jrjjh* «uit4*i _j4i>y jrUJ! J«j •


■ctlvitics- shall | endanger or hinder the safety or j wA-i ^ »*^jA V----UU


he: operations! The Operator shall offer socli olifcJw jrliJI ^Aiyl^_U5^ juUl yl jt JaM-


ill; privileges au^facilities accorded to its own


te field and sliajj|provide tliem, free of charge, ij*j,lil ojifcjl-l I,- Jll UjM JS” ctkiVoJjA jb


liable office space and of adequately furnished


ev. ar<> in the field for tlie purpose bf facilitating cf \~+*3 ijA. jiyu (5 4


tliis Article. Any and all information obtained . ojL.ll oJla U.2

lent or its representatives hereunder shall he


il with respect to the Area and shall not be ^jia^AC layll* jt IpJc. kL*UJ** *itj


' ’>e term of this Agreement without die prior SL» d[ijL jjA ^j 5-2k.U J1


EGPC; and TRANSWORLD. * iiU Aj-LTfcAjUi^l sift jl. ^


L. !


• * *.v


.ARTICLE XV ^ ojXp J


1 -i-


ENT RIGHTS AND TRAINING OF ARAB


PUBLIC OF EGYPT PERSONNEL


sire of EGPC and TRANSWORLD that opera* oUL.«?l jt Jo jy*~»ii ( I )


der ho conducted in a businesslike and efficient ; 3.L jU) ^ilir^l ala





(^u J* --- \


triple administrative professional and technical ^t_j* J^jSj AfUfcdl


.•I employed by the Operator and die personnel vli'jll lijW .lAikJIXiJ


■oisitactors for tlie conduct of the operations


er, shall he ■ granted the special residence as ii^ (j- 1A SjO.1 ^ *W * ” S^l rf4» A^Uil


i for in paragraph "E" of Article 18 of Law jlL J J^'l \\\< 4iJ ^


.f I960, as now amended, and the work permit


ts as provided for in tbe Ministerial Order No.9 ijj jluil Y ^TV* V._J ^ jl>) J Al®


, as now amended, without prejudice to the i»Ul V»U*Jl,<5l«il ^ , C.)pjiy* - ^V'


laws'and regulations relating to public policy


ic security.





 WYC^.fjXJi u J (gli) YY j. }\ ;a,


•2££:.<


■f'-Sf^ $-2.: A minimum of fifty (50%) percent of the combined





_;7; 7 and wages of the expatriate administrative, s-UM* WW W! jj^.% 0U,U o-.( 7.«* .1


7! professional and technical personnel employed by the


Operator shall be paid in Egyptian Currency. .CiUaJV fU* ^|l|j >;


(6) The Operator shall select its employees, and determine the oU*Jl* ^Ull fpi\ jjiJI AA* 7


: number thereof, to be used for operations hereunder. £* ■*«. \J Xk~j .u-j t


TRANSWORLD shall, after consultation with the Govern*


ment, prepare and carry out specialized training programs j £r-*Aiv„ll qC,Uyf Xfj&j, jJu j'


for all of its A.R.E. employees engaged in operations iftbna) Al+JI j oUix) 7;:.:





hereunder with respect to applicable aspects of the petro¬ CjjUJM •*■*!> ^U'l j., Jjjlj)


leum industry. The Operator will undertake to replace


gradually its expatriate staff hy qualified nationals as they • j*'


are available.


ARTICLE XVI \J)\ i-jU saLU) •





LAWS AND REGULATIONS


i) The Operator shall be hound by the regulations issued for


the implementation of Law No.66 of 1953, as amended by


Law No.86 of 1956, including the regulations for the safe •iMi j U iU ai^j OjlliHi Ja»U


and efficient performance of operations carried out for the AJlirVl A) jU.! ^LUn’l Juei ^


execution of this Agreement and for the conservation of J^jUi Jc i/Udlj i UJy 1 ji-~ 7 .


the petroleum resources of the A.R.E. provided tliat no


regulation, modification or interpretation thereof, shall be V jt Jo V y** Sjj*~ 7


contrary to or inconsistent with the provision* of this . uUr'iM oi* Ajijy’j’i /WU* .v


Agreement


(b) The rights and obligations of EG'PC and TRANSWORLD AaWV sAa j ^jljll j]j imLj ^il*l^ilj. 4/^. *v.


under and for die effective term of tills Agreement shall 4-iUrVi «A> jj£j ljU-t Jljl* j'


he governed by and according to the provisions of this 1


, Agreement and can only be altered or amended by die £j* jUfh Vl^lgL-W li Uj»!»;


mutual agreement of the said contracting parties. , SAiWil


(c) The contractors and sub-contractors of the Operator sluill ^ Ulto^bi M jjijlslij jjIjUli ■■


be subject to the provisions of this Agreement and they shall UjA«*> Jjl Oj*Q j»T' U'SJlarlft e-b>*£o-V


be bound by all regulations which are duly issued by die


^---- Government from time to time. • J**^ j* **jCJJv'


WJUaLU)


ARTICLE XVII


RIGHT OF REQUISITION ,>_pf y>l j dLij1! :t





{«) Iu case of national emergency due to war or imminent


expectation of war or internal causes, the Government may


requisition nil or a part of the production from the Area A.U f iiWAl ^ jT JS" Jt .


obtained hereunder and require the Operator to increase Sj\i j jcli! jtjViUr'il aA»^a^


such production to the utmost possible maximum. The (JjLy ol Jl


Government may also requisition the oil field itself and, if -^h* Jil JdAlJe 4«i; Ji- As.


necessary, related processing phiuts and refineries, if any.


(6) In all leases, such requisition shall not be effected except . ^ jlUA-Uc ;


after inviting EGPC and TRANSWORLD or their represent¬ j , fUA>! A*I VI ^ ^ wNiil


ative, by registered letter, with acknowledgement of receipt, ., tVLL*Vll Id* oU J


to express their views with respect to such requisition.


 w\t l- ^ ^







«• s; ;;• Jh-. J0 U; <$• *'***'$■£ ( gj -S^A


...i "Lit ion of production shall he effected by Ministerial


" Any requisition of the oil. field itself, or any related «J ^ ^ C- jf> tl® C«jjl •


plant or {refinery shall he effected by a Presu


K*cree duly notified to EGPC and TRANSWORLD.


event of any requisition as provided above, the


o\ jCA-1 ^jQr j u-i'-' Li UJ» ^ ^ ^JL. j ^ ^ ^


jest shall indemnify in full EGJC and TRANS. ^'i sjj-i jc- '^uru^ _>»


1 Cor ttve period during which tho requisition is ^ \ ^sil!a j'c Lily


ird, including (1) all damages which result from (y )y te> j\r^^ ■■■■


qtiiritfoi!, (2) full payment each month for all ^j51 JjJLU •u.iJi jLl---' . *•• '" $"■ •’:*?


tit extracted by the Government less the royalty Aitj 4 C* jl L* ^i# A*»_jjslA ', ajW\ ^AP’ Al» LjyjV 3.


■’ such oil and other obligation? of TRANSWORLD


PC hereunder. However, any damage resulting from *i-a Jo Lil^ yjj4 djLl^l


(Mack hi not within the mivming of this sohparvig- jis „\x&\ \$\ o'*' ^L 'Ll


• ( J S^aiW A» Oj+ji ‘ j


v.


OjUa


ARTICLE XVm


? ^


I ASSIGNMENT


3r'3U-Z.


':' *3y-lV%


I A---A1 *3j^* ot jyt. S} ^ ^ •j ,


EGPC nor THAlYSirORLD may assign to a person,


corporation not part hereto, ijj whole or fa part, any ajj* w*-yi Sj jil'l V J\


'[gins, privileges, duties or obligations under litis ■; ^


ent without the Written consent of the Government, C ijc aiiljVl OyJ< IJUj'jJl


r, KOl'C or TRANSWORLD shall ho free to assign


r?, privilege?, duties and obligations under this A* v!yjc. i>* V_L 'Lj U^-'j " 3 3: ■■':





•ut to an affiliated company and provided, further, J*jAi-uV -5^i


• assignee iholl be as qualified as the assignor with


it> technical and fiuaucial competence and, ■jL *\£J r . j, . - * -----?--0^‘JJUi*U v


LL alignments to assignees wholly owned by TRANS. JSV ^ ^V- Jl JjU'' ‘


), the Govcmmcm‘« approval to the assignment shall . 3j\ V_'e ti^Dl ■" ;;.,,r.v


obtained. ^ ^ J>d oiUUlur-X.


t


vent that EGPC or TRANSWORLD wishes to assign,


i or ia port, any of its rights, privileges, duties or jlvl j/ i>' ‘*P ^ ^ U lit UW


-mis hereunder as aforesaid, the written consent


of the Government shall not be arbitrarily withheld, >3 4 ^ ^ ^& ' / :T'" ■■


hie consideration to he given to any request for ,L^ VI «ft


nsent, the following conditions must lie fulfilled : • L" ^|l .


l i


*j\ JS 6


obligations of the assiguor 'deriving from this Agree-


ut roust have been duly fulfilled as of the date such


urst is mad*.


proposed assignee ox* assignee* most produce Jl o' ft?' 05^ j' 0\ OjUl Jp ^ J T


•A .L,


sotuble evidence to the Government of its or their . Lil'j ^ jj jjj ^ p; v-'


social and technical competence.


 .4' -■


wvr \\ J (a.1) yy ijjj ^ s*





The inettument of assignment must include provisions oUt ^ 43U,


stating precisely that the assignee is Bound Ly all x^] ^ -Vji ^ jj- 1


covenants contained in this Agreement and any modi¬


fications or additions, in writing that up to 6uch time f*** o- cijH da ^ LfJe Uj&'v^,


may hay© been made. A draft of stroll instrument of i*£.L\ JI ,\\ • o'.a'.ilj '


• assignment shall l)c submitted to the Government for


review and approval Iteforc ireuig formally executed. ' *-*yl J:*


(c) Every executed and delivered- instrument of assignment


assigning any o£ the rights, privileges, duties or obligations


hereunder of EGPC or TRANSWORLD shall he submitted y/' > w,AoMi!* \\ 0ui/ ji iiyi- jiSs





to the Government within thirty (30) days after the Govern¬ *‘jCU .i. jMC ; :::


ment approves the assignment, for registration itt its registers. OjUl j^jCLl isij.ij. ^ ^.(r-^ J5U. a.











ARTICLE XIX


Breach op agreement and power to cancel ikU, uUrtl r~ ■





(a) The Government shall have the right to cancel this Agree¬ Ji l ; j}_\ ■ =


ment by order or decree, with respect to TUANS WORLD,


in the following instances : '-■'j- \ j ✓>V; '


If it knowingly has submitted auy fals.- statements to


V^


the Government which were a material comidcratiou


for the execution of this Agreement. j


‘X&l !f?, J cf ^ HI - T S/;|'


If it aligns any interest hereunder contrary to the j


provisions of Article XVIII hereof.


Jf it is adjudicated bankrupt by a court of competent . sia ;.v


jurisdiction. » It*.* . > ---. .


If it (loos not comply with any final decision reached | • V* ..** ?i • , - t *. • .-Vi • i


as the result of court proceedings conducted under I , *-»lr J'A > -w- ji '.4 --- fc •


Article XXT, ! • A*.i ioj j 1 ' ^ ^ i| 1 - •• w •


If it! intentionally extract* any mineral other than I ^^ _g;J|


‘petroleum, not authorized hy this Agreement or with- !


out tlic authority of the Government except such extrac¬


tions las may he unavoidable as the result of operations ^ ^>=.1 -r4 ^ ’


conducted hereunder in accordance with accepted pet- j


joleufn industry practice and which shall be notified i '' J'’ ■^^ j ^ to,*!** I


o the Government or its representative as soon us pos¬ ' ' u tr*\ Wlw j\ l*jSTJ-1 jU.a-1^" :■


sible^ and


'5. If it. commits any material breach of this Agreement


or of the provisions of Law No. 66 of 19S3, as amended _u- *.,1 ■<■


hy Law No. 86 of 1936, which do not expressly contra¬


dict with the provisions of this Agreement. Such can¬


cellation shall take place without prejudice to auy


rights which may have accrued to the Government iJ*


against TRANS WORLD in accordance with the provi¬


sions of this .Agreement; and, in the event of such


cancellation, TRANSTORLD shall hare the right to j


remove from the Area nil its personal properly. j





 \«.vr c- trk4t w j (£» Y't1 jJ*5' - v-v3'


u's WJU it up. I


.) If tlic Government deems that a cause (other than a force


oiajente cause referred to in Article XX hereof) exists to


eaoeel this Agreement, the Government shall give TRANS*


WORLD ninety (90) days •written notice to remedy and jT*'-* **- jjj*h v


remove such cause, bnt, if for any reason such service is


impossible, publication in the Official Journal of the


Government of such notice shall ow considered as validly


served upon TRANSWORLTh If. at the eml of said ninety TA**,


(90) days notice period such cause has nut been remedied


and removed, tills Agreement may be cancelled forthwith > fcjfe'ijl Ml) Jo, #CJ - JL\ * :■■


by order or decree as aforesaid, provided, however, that if


nch cause, or the failure to remedy or remove such cause,

esults from,any act or omission, of one party, cancellation ^>4C;r *&*■:


>f this Agreement shall be effective only as agaiusl that


rty and not as against the other party hereto. J Oji 0jUl Ui JJ ^ :


. ^ j _





'RANSWORLD shall bo allowed to remove their beloug- .'V o i


i igs from the Area of any lease cancelled hereunder after XySx^ 5iU.\ sAJ. {£*•"} U-J1*’ ' A


• Uing all claims due to the Government. . a*j3& ^ |


' ARTICLE XX


(c^1 uuiy I < , I : ;)•


1 FORCE HA3EURE l^Ull Sjftl


'he non-i>erfomiance or delay in performance by EGFC


3j*A ^^31 \>\ j* j' \ «


:id TUANSWORLD or either of them of any obligation fCl'S” VaI, *l»J'


elder this Agreement shall l>e excused if and to the extent


iai gueh non-performance or delay is caused by force Ai>>jAv- £ wliij ~»jA& 3j5 \i -w J\ bUj!!


fljeure* 11m period of any such non-performance or delay, jii-tol jl xjl Ajfi (Zi) SjIIj . SjaIa) Jji)l y?


. jer with snch period as ruay )>c necessary for the res*


( I t)ZA* Cl/^» ^


re_on of any damage dune during such delay, shall be


ded to the time given in tills Agreemnt for the perfor¬ o-i* (3 5^ til a*0>) aAA ■ •


in g of such obligation and for the performance of any oU'M’ltius a!= J-\


igation dependent thereon and to the. term of this Agree


ut, bnt only >ith respect to the block or blocks affected. » oAy wUOai-i 3) ^Uaili





■jrce Majeore”, within the meaning of this Article XX, tl/ 0Isa SjjJI ^ A^ajj ^w


!i be any order, regulation or direction of die Govern*


it of the Arab Republic of Egypt (or the United States 0* *~f:y {&* 3^ ^ d-


America Government with respect to TRANSWORLD) ( <-J'A *-*H^*^ 5A»£S*\ **^“13*3^ y


liter promulgated in the form of a law or otherwise, Ji 3I ejO\^ Ay*


ny act of God, insurrection, riot, war, strike and other wjW 't'Uop-j b^tjl ljJ»3cUia ;


ut disturbances, fires, floods or any oilier cause beyond ^3^3! cMJsAWji vl j-Wi.; ‘;


control of EGPC and TRANSWORUl or either of &>*' A---3U 2^3 ij o*i! ci! it;;’ ;


i


v, whether similar to the cause' hereinabove specified


ot. y** 3^ ^^4 *•'■*---* ti 0^ \ Ay* i aJo -iJU. Jt otjSl y /,■


* ^Sa^M


 i'W J (ct’O YY ^ “ V-v-’’ ■ ■''’'^tSfcS


WYT


----------------


Without prejudice to the above and except as may he --TV&TggTw


jjj jck- ^


otherwise provided for herein, the; Government shall incur Vfu ^ SKh


no responsibility whatsoever to EGPC and TRANS WORLD,


or either of them, for any damages, restrictions or loss j\j*\ -4-1. W* i\ U i*-^K-


arising itr consequence of such cause of force majeure, except SjUi- ;


a force majeure caused by the order, regulation or direction


of the Government of the Arab Republic of Egypt. '«iU \jp\c! !.








( 4t jU*\ SiC_l\ ^


ARTICLE XXI





DISPUTES AND ARBITRATION yurtH o?.Mj <•/34i eg


i


|


(a) Any!dispute arising between the Government and the par*


ties with respect to the interpretation, application or execu*


lion of this Agreement, shall be referred to the appropriate f** yida: 'y


A.R.E. Courts’ jurisdiction. » J-saD





sH* £**' & ’•bPl" ce Ui


(6) Any!dispute arising between TRANSWORLD and EGPC


shall: be referred to arbitration. The arbitration slut 11 be


initiated by either party giving notice to the other party j09) ■$■&£$:::


that it elects to refer tlic dispute to arbitration and that


hucli party (hereinafter referred to as the First Party) has ***$*(?* ( *


appointed an arbitrator who shall be identified in said ud'*P.*) ^^ tj/jiV


notice. The other party (hereinafter referred to as the


Second Party), within fifteen days, shall notify tiro First 6> >*d(H JUii


Party, in writing, identifying the arbitrator that it has I *b* U


selected. If the Second Party does not appoint its arbitral Aft uijM C# WfVf ^ ^


tor as aforesaid, the First Party shall have the right to uit yytt


apply! to the Court of Arbitration of the International wt V*-* ^ ^


Chamber of Commerce to appoint a second arbitrator. The


two arbitrators shall, within thirty (30) days, select a third && ^ U'*t u*


arbitrator, failing which the third aibirator shall he appoin¬ JriJ\dl


ted by the Court of Arbitration of the International Chamber


of Commerce at the request of either party. The third arbi¬


trator must be a citizen of a country other than the A.R.F..


or the U.&A- and a country which has diplomatic relations U .1 ^\.cACiJ\y ^ ^ 3,^..^


with both the A.R.E. and the U.S.A. and shall have no


economic interest in the oil Business nor the signatories wi>va


hereto. The arbitrators shall etsablish the arbitration MjMj&>Vijo


procedure. The decision of the arbitrators may be given Jjoj j W. o\ c


by a majority and shall be final. Arbitration shall be held


in Stockholm, Sweden. . lj?lr j ^\, ^^


' '


 \\YY *^> Pf* .'jJl - Jl s* *J|


* *✓«





ARTICLE XXII (ytii s>lu)





i STATUS OF PARTIES (^

fhe tJglii-S duties, obligations and liabilities in respect


•f ECPC and. TRAN5WORLD hereunder shall he several


iul not joint | or collective, it being the express purpose jij «A>(J jJ


£1jJI J Jejft at J* cil!j} Xf\f


nd intention jof the said parties that their ownership of


ie icspectivcj percentage interests tinder this Agreement <~m4 /j« hJ. U^iU (jt^a ^ j '>••••


■all lie a- tenants in common and that this Agreement shall ;_-L^ J* aAs jjjAl


>t he construed as constituting an association corporation, Ijll Ujt---«r j>f V 4iU‘Vl«A» Js yl/U- ;


ining partnership or any other kind of partnership. <>a» y *^kl--- jt S^> <£*%


- iSjUii pAjii (j* j21 py Ji-





* .


" iKSTOULD >hnll he subject to the laws of the U.S.A. v* aS'-L--*^ iA«ri\ cA vy <>j|i_yj j (v) ■


/' ding its legal status or creation, organization, charter jiJyUB





>uT>y-laws, shareholding, management and ownership, and IXt^i j IAI« u*b .


> principal office is established at New Orleans, State of


■uisijna, LrJS.A. TRANSH’ORLD's shares of capital which V$*» y^jyjy <3 s-4caa\


e entirely held abroad shall not he negotiable in tltc JU u" \j 5A*iM ol»V«M j lll~---4


R.E. and shall not he offered for public snliscriptlott. (£:fJj’f


dANSWORLl> shall In* exempted from the application i> l^r Ai; j_yf Vj»


Law No. 26 of 195-1, as amended. . jJjSyjv n*t x'\ Jj








ARTICLE XXITI ( b)

\L CONTRACTORS AND LOCALLY MANUFACTURED dulM j J ,un


MATERIAL


I


i Ajlyli.; oll*JL ^U!| Jc ( V')'^ -


Operator and ii.s cotilrticlors shall : L> 'i.


o *jhu-! c-*b!> Oi^ i oJjUi \Jyf\ ^





Give priority to local contractors as long as their prices W ^Ul JjS'1 Afjij ^ A*.jAj-


and performance are comparable with international


prices and performance. The Operator shall, however,


subject to j the preceding sentence, he exempted from . 4l>b«W_J


the provisions of Ib-crm No. 1205 of .196!, as amended.





C,\mW ijSy ^>^11 flyS \WVUIWI --- Y


Cite i>refereiice to locally manufactured materials, y>\.A» JJ* ^ £*

equipment, machinery and consumables. However, cXV>\ ^


socii materia? may be imported for operations conducted


Inn (Minder, if the price of the locally manufactured ij> 0-^ flall Ojli ^u3 Urf »rV| = A.


mcuerial at Operator’a stores is more tlian tea percent ijft- ^ !A)y-U oL:1 ^ )XvJLi^'""' "'' ::


(10%) higher than the price of the imported material


at Operator’s stores.


 wvr al- \\ J (^.t) YT


W :J| (iAZ-'L.WJI


* ARTICLE XXIV


l


ARABIC TEXT AND THE ORIGINAL


i


!


Tho Arabip version of this Agreement shall, Before the \’A, jVj’Usuo'i!! jjj»(j \ j* iii


Court? of the A.R.E., he referred to in construing or interpreting


this Agreemenjt $ provided, however^ that in any arbitration (.Wj'i1! jL- (j it wl)j £•* i ** j*1! ^


pursuant to Article XXI between. EGPC and TRANSWORLD


hereto, the English version shall also be used to construe or inter, (jrfJI jli ^ SjLV,


pret the Agreement. • yt"J }\ i Jlj*^ 1 eA> l»b^t *««---!>«*.


:!.•


ARTICLE XXV ( jiJ---U )


approval by the a.r.e. government


/---This Agreement shall not he himliiig upon any of the parties


hV/cto unless :and until u law authorizing the Minister of IfJ „i_.!e t£...


?ctroleum and Mineral Wealth to sign said Agreement and «uS^ 4i _jy J.f" •!,.«”J.'. 1 J J---'-• ^ i jl .


living Articles jlll, X, XI XVT, NVIT, XXII and XXIIT of this oUfVi oAa J* ajj-\< j jj•


Agreement full force and effect of Law notwithstanding any


•omUorVitilitig governmental enactment, is issued and published iji! 1 oltfV! ;1» ,v» •>(>':[


u the Official Journal of tho A.R.E. ' if *' li w


ARTICLE XXVI ( JV-- .W-l £ J-1! J ‘~'~


ASSIGNING BY EGPC ,i, :jj;.u p jjt: • . •


EGPC, in its capacity as holder of (he concession, assigns J* XwU . lj.\S 5-1*3


il it? right., and obligations under this Apivemcnt to the General JjU<---JI i»UI (Ji *A* j ll^s.Z?-;^^


'h'lim Company in tho A.R.E. ■ A--- >^Z> ! ■


c


N”TV WITNESS WHEREOF, this* Agreement has been duly

’••tiled by the respective parties hereto as of the date first .;Vi jJ>j j j/ '.M ^.jU-1 j


i reinahove sot out.


EGYPTIAN GENERAL PETROLEUM A*UI A) -^1! (j*


CORPORATION


Bv : .................................:.......................................


TRANSWORLD PETROLEUM J*** ly . .


corporation


Bv : ........................................................................


FOR TIIE GOVERNMENT OF THE A.R.E. o ^..‘v! Ai 'a.*?-*


Bv :......................................


 wvr ^ n j (ct) vr - j) :j,. .9-J!





:U


ANNEX • A"











DESCRIPTION OF THE TERRITORY








EGPC • TRANSWORLD Ji;_ 4_.ill








\iuie« “JJ" ir a map on tiie .-calc 1 : 100,000 inoludiiij; ; ^ ^ g" a-V^ J \


•i---'tiiry r"Vi-ii' Viiroi-nn'iit and dcs.


1 ... fnlln' - :








. *J,Ul iti. j.UumkU(-Vjt.)-:


I Id-- iiri'a i- Itouuded I'rom the l>v tlir ,-hori’ lin ■\ I








awn’ilit’.au*. r.oru.'v,- i,ii Annex ‘IT arc a.- i : 3 ')>'£' ^ ( •_' j ^X^elA'u 4.^^ )


1 ■*!!• i^v.a : ' ‘





•n\


l.AT. S.oni':. A;- ««• ^


[ w s





•1^ ’ in- i; /’ •*.* 1 .. ;o* J A Vr 'i r -4< JLA TA V <3 A ;


.•>


I *. , IV in' f>:5 fr ’ rr '\n '■V JwT t A V : .■■n'A


1.^ ■ f'7' <»:>'' i If)' .ii/' ! a > V> V JLr TA '•V *o '■ (!"


rr


•*> i ns' (K~ i 0:1" j rr 'r- T JLr "TA '•A •• .: P -


:vf 1 :o' •A ::


«i o »> i rr 'r; rv * * * TA '• \ ,y 35


Sr.' i or ' rr.r • K, *• t ) t W1---“


! i 1


\VvT -C-. crii_tl \\(j JjJl --- L---J\ SJUj^l :.





 \KYT \A j (fi1) XX jaJI ,.








AAM-IA - i)" (*)J*JIV





ACCOUNTING PROCEDURE





ARTICLE I


*o)i,il'cl to the previsions of tliij Agreement, TR AIS’S-


ft* UjUi 4, ..van


;LD- w Operator, shall alone bear and pay liie following i/b ^ c**eAl,


ant expenses, and Ik; entitled to apply them against its


■ lions : --------





7V.i<’s 'iinl 'tirjiwf ri/th/n


; --- v


•n lav uml/or direct cost attributable to I lie acipiisUion, ^ o6ted . uu.l j) c isAf


/" <>f surface right* acijuired ami maintained in force for


. ^ x$£&: I


, rnt'fy-








,

■ ilartt's ami wages of all (>|ii'j employee- engaged in


u i; virions aefiv ilies in tin; territory, including salaries and


iges of employe's who an* temporarily assigned to and ^ ^ j** y. jUa'i jlfc; j

oployeil in «>u*l< activities. ^ y i.5j» ^isifcjU j_ys-f j


. ikj’Vl !.


Operator's oo«t of Iiolidux. »ue.it ion. sickness, di.~ahilil v





•ji-fils. living and Inni.-’mg allowances, travel lime. bull- ' »lj J;U- J *ru.'! (i-JJ


( anil other CU'luiinuy allowances applicable to tin: ol-l* ) AiJl \C- Jssul Ale- _^,( A, „:'l j ^y*»_yU • .


salaries uivj wages chargeable mi tier sub-paragraph - (a) Jl^Ajl ^ o&SJLV,


of thi* Article. Costs under tills sub-paragraph 2 (b) Jl j *>. v|j A >---- .;


shall he 25‘,£ of the ainomit of salaries aiul wages charg¬ . gii_*. 1 aXx ^ f---x ) Vji-I "bV.vvi'


eable under suls-paragryph 2 (a) of this Article for S-"*** b^-J i_»y-J ( <_> ---’ V ) ----^1 Sj*iiH aJijki®-


o\*^'**a O'* (7-To ) j 1 3" ;V


TUANSWORLD expatriate employees, aiul on an "as vilijy Sjl---^-^ss-y j^a'


and when paid hasi#*' for A.R.E. employees. ^U.. ^ wr®£, W‘ '-*b V--'ijy-i'iy ■■ ■


. frc.AW (ifj f





h ist of expenditures or contributions made pursuant to


S'-Ps-ioOnt, imposed by A.R-K. governmental authority which UrJ,viy^,u*jyu;t Wt ■(* c/iUu^r;,V;^|


tire applicable to Operator's labour cost of salaries and


w’lgc. u- provideil under sub-paragraph 2 (n't and 2 (b) ('-*Y )o;::^rL^ wUjll ' > ^


41 this Article. - Sj'-11 O' (v - T ) y


 r\ \\Yf n j YY


jaJI ~ *_r^'





3. Employees Benefits


« l \yt.





Operator's cost of established plans for employees group ’ crWJliU u^U-i^Uir;rn JiilJsi-jc»uuyisllt


life insurance, hospitalization, pension, retirement, slock pur. •.\}\ a/.}aIu-JIjS.:kU^


chase, thrift and other benefits of a like nature. costs under i y /, . . ... • 1 . **■.,' ., , . ,. ,


*7--- (r) ,_•**] s-t* J -V.i w^JSUi! --- Ljll j, C-ji


this paragraph 3 shall l>c 12% of the amount of salaries and oL^ll *«..» J*(7. \ V ) a I' d J


Wages nliargeahle under eub-parngrapli 2 (tt) of this Article 0jjs ^ ( ^ --- V ) i l‘^-.rje


TRANSWORLD expatriate employees, and on an “as and when .^'cjUIa'I l_j.j L*lj a. -J


paid basis*’ for A.R.E. employees. • " A-oj U;1* j ,JvJe. jjCr *( • o - j* •


4. Purchase


(«) Material, equipment and supplies purchased shall he at s-ij** 3lyw-i w'aaUj sZj





price paid by the Operator after deduction of all discounts JJ1 Am ^j!.1*.»!Ii ^lill A.-dAi


actually received.


(Z>) Material, equipment and supplies may lie furnished from ^LUnIii




Operator's slocks outside the A.R.K. tinder the following U*• I f *3^ j*


conditions :


1. Aetts Items {Condition ".l ’) (“\w V-) ; > (. i - w)





Sh;i I be priced at cost, provided that the co.-t of items - A_> 'i,‘ 3s^.h Jii5C'.,l j*~J jrt.


supplied is no higher than international prices for items of tj.il J wA

similar quality supplied on similar terms prevailing at the . j!/! jL* J.j« V f S& A-iJI i


time such items were supplied.


2. Used ItenM (Condition "H") ( *v» )


Items which are in sound and serviceable condition ami ^ • 1 |


;.,U; is-i-’; Ak-.K <’■* dy ' *


are suitable for re-use without reconditioning, shall lie dus¬ A1*-


ted a-. Condition mid priced at 7.V/e of price of new one, ,s-s ( ' / V J ; V^'1 w; s.».> •


' •* w . 7


The same base will In; followed with items which after recondi¬ Aw ’ '■ «^l • . . .


J' i .U- l»AJi


tioning outside A.ICC. shall he further serviceable for original ..(wj’J ( ^ • * .)z


function as good second hand items (Condition “B"). yy


3. fItems (Condition ( " g- ' a3*7 •«---- al v» (r --- 't" )


firms which arc serviceable for original function in;! sub¬ A^l \^\/\ j jP J


stantially not suitable for reconditioning, shall he classed as rjA iM


(mnditioii “0” mid priced at 5tir/r of price of Jlew one. .ip, j, ( 7. o -)j


4. Other Vsed Items aI- (t --- ^)


Heins which cannot he c.assed as tmmliliun •‘B*’ or


ihall he priced at a value commensurate, with their use. Tanks, L. .--Idi A»~»J j**^ •---


buildings and other equipment involving erection costs shall ;l ,U-I . UB-UU





be charged at applicable percentage of knocked-down new s,ji* LA kOA' J ^V1 J 1 x-<-iS


pi ice.


fci will be enliflcd to dispose of its owned .••s>ei- when 1


'llie-. become i-cr. ice.ibb:. .vY. *■=-■■* A'


 1 yy








‘•orlntion


spurlaimii "f employees, materials ail (I sup* ^ oIjU-Vi> oi-j'a, oU.Uj o-it/i jit


•■.-s.iry for i!"; conduct of ihu activities. Employees trail*


ii cM-i. <-] i ;i 11 include travel expenses for them and their LiJI


to and from tl:<*ir (mint of origin at the lime of employ, (*r^J


fh • |ir»u> <.f -rp a ration and for vacations, and travelling a+3 t ja j 3v.) ^ ju j*


roc c mpl<>\ees and their families incurred a-i n result y- ls1'


tr. u»l i- fi mi one Tooulhm to another.


• o irl lion cosis for employee, and their families from JA ^ ^ £/ f ■ £0- rr“*Uj ctffcjU y ^


a ay itho' branch of TRANSVO-RLD shall he charged


:her ram i. ■ ^ £>'' ,Ju > y Jijjjj *jj tj*


ri e* : oVU-'l --- T


cm;-nil mi- contract -enie-s am! utilities procured V0 s)'**" ls* jjiftj \)


£-**rd pm lie-. • ./-»! j*


f i.lperutn •'.< owned mnvnhle assets shall ho charged ne- M (v)


;i”. to ■itli-[>aiMgrajili la I 2 of Article YF of the Agree-


l.eiiora' iry *(>r\i porlnnncd In the Operator sueli SiU'-j* (r-;Xi\ j Jl UJ»


J:* o’AwJ; U/.U jJI J.l.1!


oaeiv playback and interpretation of scititlo-


ma.iiii'lii tapes. aiul iniv other analv.-os and tests per’ . V‘>-^ oU,l_, A",/ju’l


■i' al linn e laboratories and olTice- of Operator, shall ^A-^' O' } -i'j-_>*---y-JJ AJAill


i.'gcd at 1 iir rales- pnnidrd that siieli charge, shall .-nit } |0Xu:i J


1 iliu---- current!, prc\ailing if }>crfornied In third partv j ^Lil «AaA y V! }aj*j oltit ,_L^ j-,_»


i


*• lalior.it-iri-'.. I • j C-Jl _J ijlc JA*l JI





• an,l f/isse- % J 1------m y


. nr e\ pen-c> neces.-ai \ lu rejilace or p'pair damages


i'it'iiito.I in fire. (lom[. slorm, theft, uee.ident or am i'\ jA:ii / y.y j6 ^ Jii y ■cf.


Cx >1 euiiirollalile In 0[ieraii)r llirnttgli the exercise


' and due (liligenee. Operutur shall furnish MGPC. «l_jA jl J&sJli jfU'J L V jA l wX< jl ^i-1 j]


•lice of damage, and losses incurred a> -otm as pract- w/i j o^d*-J^y jAi*! J&j \\\oj A^».


•r n port «>l the same has hoeii received hv Operator. jt-lil ^ ■* jl Avj _j . l_^- :»j U 4,\'S~_til jUk jl


ml i-ltuitts JS o \UJ[,





: ul unv piddle liability, property damage and other j6- -iJ'So


-.gai'-isi I'mlrl'iiics of the Operator to employees nud/or jl j-it jl jC U 1 * Aj»


. may l»c n'ljuired l*y the laws, nil's mid regulation, ^'yAj C/’U'*^ io->* 14-jIi


.ernni'-iii nr as the parlies may ag.ree upon. The


-hiili credit aguitifct <>(ii'r:iting cost as the cum* may yjji* c-’"yi


.ili' n. 'levi Iiipinonr ...) the proceeds o[ aav such in- J,Al" j*1 If*5" i'' ‘■•‘I oAi Jha,' Asi^l


claim roll vie I by it. Jf no insurance is carried, all ^ oft *sr> ;i'- ^ ui (_... */-■-* )w j,c-


ells--.- incurred and paid by die Operator in settlement ji"! )\y*> f Ul*1*. oUidl


! all looses, claims, damages.* jwlpetiKMii and any oilier


nchiding legal services. .iAUiioUAun^





 WYC 0v-k-i1 V\ J (^t) VT


. pj.1 > j**’1 **4/-u-


9. District and Camp expanses


upa, a* j=- ^ ^


C amp overhead and facilities such as district warehouses, water


ays cms. road systems, expenses of employees working in districts Ujtb j q-I-U1! *l=!'


an> camps, excluding salaries and wages which are chargeable \ , ) ijiill Ui J> Jil relV --W-'


according to paragraph 2 of this Article- and all other general . ja uu vj-: ^


dir rict expense*.


3 ). Administrative Overhead arid Genarid Expanse vua:’l ^li. **U,





(a) Co.-t of staffing and maintaining Operator'* head office in j>S|i

the A.R.1'1. and/or other offices established in tbe A.R.E.


other than field offices which shall be charged as provided ! J*»-l j iliiii - •! l4e If* , “ - * - £ )v5


in paragraph 9 above and excepting salaries and wages of j > j aJIs ( ^ j tji'lA J 0_)J '---1 jl


employees which shall be charged as provided in paragraph


2 of Article. .•'ajLJd 4x& .


V .-(b) Operator’* administrative overhead abroad applicable to the vJ*


iUJX\ J-b f1' **-i| \y-if\ oi


A.I1.E- operation shall be charged each month at the rate of , WU wi~: £. r. £)JoU^h


four (4%) percent of the total exploration expenditure of.


-ucU month, such rate shall be applied only during explo¬ wUM si-aeyfl ott* ^ >(".() iSj.! J


ration period. . is a-J ;.3 .f; a«1 m. j-W, jj.


ii. Any expenditures, other than those which arc covered t-L^'l id ivLL J’f ™I 1*1


and dealt with by the foregoing provisions of this Article incurred I e- . » ,


by he Operator or for the necessary and proper operations in • V--- ’• J Ifcsljl


the territories in the A-R.E. • iiLll jj,A .9


...


’ •* V ✓<.**«





ARTICLE TI 1 T ;■>:•)


BOOKS AND ACCOUNTS oilJ.i_,


^ J. In addition to the necessary sulwiceounts, the Operator


i ludl establish tlie following main accounts :


• • '*


A. Exploration expenditure control account. :




II. P-velopmetU and production expenditure eoutrol ^'36--loUi ;ji ^ ~_>*wS 1


a< count.


C. Oil cr expenditure control account.


)). Expenditure recovery control account. ■ ol ii.;| JbJ.





2. oixp ■ml'iurc control accounts shall be used to record all K*\


appropriate charges and credil.- in order to determine the total 3_J!


'I „ 1 1


ai loiints of expenditure* to lx- recovered as provided in Article n-.i L


(


V (a) of the Agreement. ■^bi.





• .. •* «\<^C •


^Incase'bf transfer ofSyarehiause stock lten^lfromone


~ty to another,'"adjustment shall be -made through


Cent^poiditure control accounts wih regard to con-


hf_sudi items at transfer time.





Bi ca:e of selling warehouse stock items, the compc* oIaxJ! Xa\^


eijxnditurc control account shall be credited with the • lilj


! salevilue.


I • '.'S' * ■ y'\‘ -- .f .jr )ij /Usol-taJl^UliiL-c..*


'Operator shall keep its bodes in AJR.E. in United


cs of America Dollar;. All U.S. dollar expenditures


prjcec Is shall be recorded in the same amount , AD oUiJ! £-*~ . r^)r-3j=dl j] 2j^.uiiU ^Lil u*£4 •ST«.'


pti -np xmds, or any other currency, costs and proceeds


U te tr instated to U.S. dollars at the official rate of O^UjJI jt all


bange ceclared by the..Central Bank of Egypt at tfie


!• • I • I 1_1_ --- -- --- --- . .k ■ Jkk . --- t. _ ___A_ AM -- --- -----. - y*- --- V (^ill jjjJl ^ JjVQjJl j cirjrflil dfJl AdA- tcil 1^-





yiii jiwij


T"^" . x - * - -• .;vjs oUa' 3 «Pk