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PRODUCTION ENHANCEMENT CONTRACT

Dated 19th of August, 1999

between

Joint Stock Company UZGEONEFTEGAZDOBYCHA



and



BAKER HUGHES (Cyprus) LIMITED



and



Joint Stock Company UZNEFTEPERERABOTKA



North Urtabulak Field



Republic of Uzbekistan



1



*[table of contents omitted]



2



PRODUCTION ENHANCEMENT CONTRACT

This Production Enhancement Contract (“Contract”) is made the 19th day of

August, 1999 between

Joint Stock Company Uzgeoneftegazdobycha organized under the laws of the

Republic of Uzbekistan (together with its successors and assigns,

“Uzgeoneftegazdobycha”) and

Baker Hughes (Cyprus) Limited, a corporation organized under the laws of

Cyprus (together with its respective successors and assigns, “Contractor”), and

Joint Stock Company Uzneftepererabotka organized under the laws of the

Republic of Uzbekistan (together with its successors and assigns "Refining

Agent")

WHEREAS

All Hydrocarbons (as defined herein) existing within the territory of Uzbekistan

are a national resource owned and controlled by the Republic of Uzbekistan.

National Holding Company Uzbekneftegaz (“UNG”) has the exclusive legal right

to carry on all petroleum operations in the country.

Uzgeoneftegazdobycha, an Associated Entity of UNG, has the exclusive legal

right and entitlement to carry on all operations with respect to the Hydrocarbons

in the Field (as defined herein).

The Refining Agent, an Associated Entity of UNG, has the legal right, entitlement

and capabilities to carry out crude oil refining operations in the country.

In accordance with the attached Guarantee Agreement, UNG has authorized this

Contract and grants to Uzgeoneftegazdobycha and Refining Agent the right to

enter into this Contract with the Contractor.

Uzgeoneftegazdobycha wishes to promote the development of the Field, and the

Contractor has agreed to perform for Uzgeoneftegazdobycha and the Refining

Agent, but at the risk and cost of the Contractor, those activities related to the

enhancement or acceleration of production of the Liquid Hydrocarbons located in

the Field, as further specifically set forth herein and as to be set forth in the Work

Program and Budget as further specifically set forth in Clause 3.1 (“Operating

Services”).

The Contractor has the financial capacity, technical ability and professional

expertise necessary to perform the Operating Services.



3



The Parties have agreed that payments due to the Contractor in relation to the

Operating Services will be made solely from Incremental Production attributable

to the Operating Services as established in Clause 12.

Uzgeoneftegazdobycha shall store and transport to the Refining Agent the

Incremental Production produced from the Field at its risk and cost as further

specifically set forth herein (“Transportation Services”).

Refining Agent shall refine the Incremental Production from the Field and store

the resulting petroleum products until such products are sold at its risk and cost

as further specifically set forth herein ("Refining Services").

Marketing Agent shall market and sell for export the petroleum products refined

from the Incremental Production produced from the Field at its risk and cost as

further specifically set forth herein (“Marketing Services”).

NOW, THEREFORE, the Parties hereby agree on the following terms and

conditions to govern this Contract:

CLAUSE 1 - DEFINITIONS

The following terms shall have the following meanings for purposes of this

Contract:

“AFE” shall mean an authorization for expenditure form containing all information

referred to in Clause 7.4 together with any other information deemed appropriate

by the Project Manager.

“Associated Entity” shall mean, with respect to the Parties, and any Person, any

other Person that, directly or indirectly, controls, is controlled by or is under

common control with such Person, whether through ownership of voting

securities or otherwise. For the avoidance of doubt, any Uzbekistan government,

ministry, governmental agency (whether or not acting in a commercial capacity)

or political subdivision shall be considered an Associated Entity of

Uzgeoneftegazdobycha. Any group consisting of more than one Associated

Entity shall be referred to as “Associated Entities”.

“Baseline Production” shall have the meaning set forth in Clause 8.

“Business Day” shall mean any day other than a Saturday, Sunday or recognized

holiday in Uzbekistan.

“Calendar Year” shall mean the period from and including January 1 in any year

through and including December 31 in the same year.



4



“Contract” shall mean this Production Enhancement Contract, including all

schedules, exhibits and annexes hereto, as amended or supplemented from time

to time.

“Contractor” shall have the meaning set forth in the first paragraph of this

Contract and any replacement Contractor appointed pursuant to Clause 26.

“Contractor Well” shall mean any well that the Contractor has either drilled or

used in the Field for any purpose during the term of this Contract.

“Contractor’s Allocation” shall mean that portion of Production due to Contractor

as compensation for the Contractors’ services hereunder as described in Clause

12.

*[definition of commercial terms omitted]

*[definition of commercial terms omitted]

“Effective Date” shall mean the date of registration of this Contract.

"Environmental Claim" shall mean: (a) any liabilities, costs or expenses arising

from or relating to any claim, including but not limited to claims by either party, by

the Uzbekistan Government or governmental authority or any other third party,

for personal injury, property damage, or damage to natural resources or the

environment (whether based on negligent acts or omissions, statutory liability, or

strict liability without fault or otherwise), in connection with the Contract or the

activities or operations conducted therein; (b) any liabilities, costs or expenses

arising from or relating to any investigation, study, remediation or abatement of

any Release, to the extent required by Environmental Law, in connection with the

Contract or the activities or operations conducted therein; or (c) any fines or

penalties assessed for non-compliance with Environmental Law in connection

with the Contract or the activities or operations conducted therein.

"Environmental Law" shall mean any law of Uzbekistan relating to: (a)

conservation, improvement, protection, pollution, contamination or remediation of

the environment; (b) any Release, including, without limitation, investigation and

cleanup of such Release or threatened Release; and (c) the storage, treatment,

disposal, recycling or transportation of any Hazardous Substance.

“Event of Force Majeure” shall have the meaning set forth in Clause 21.2.

“Field” shall mean the “Field” specified in Annex A hereto.

"Hazardous Substance" shall mean any pollutant, contaminant, constituent,

chemical, mixture, raw material, intermediate product, finished product or

by-product,

Hydrocarbon

or

any

fraction

thereof,

asbestos

or



5



asbestos-containing-material, polychlorinated biphenyls, or industrial, solid, toxic,

radioactive, infectious, disease-causing or hazardous substance, material, waste

or agent, including, without limitation, all substances, materials or wastes which

are identified or regulated under any Environmental Law.

“Hydrocarbons” shall mean Liquid Hydrocarbons and Natural Gas.

“Incremental Production” shall mean, for any Month, all Production in excess of

Baseline Production for such Month.

“International Oil Industry Standards” shall mean such practices and procedures

employed generally in the petroleum industry throughout the world by prudent

and diligent operators under conditions and circumstances similar to those

experienced in connection with the relevant aspect or aspects of the Operating

Services.

“LIBOR” shall mean the one (1) month term London interbank offered rate for

Dollar deposits as published by the Wall Street Journal or, if not published

therein, by the Financial Times of London.

“Liquid Hydrocarbons” shall mean crude mineral oil obtained from the Field,

regardless of gravity, which is in a liquid state at the wellhead or after extraction

using separation equipment or which is obtained from Natural Gas in a liquid

form as the result of natural condensation.

"Marketing Agent" shall mean the representative appointed by the parties to this

contract to market, sell and monetize the refined products generated under this

agreement. fiscal terms .

"Marketing Agent Agreement" shall mean in the form as attached to this Contract

as Annex F, pursuant to which Marketing Agent will be bound to the terms of this

Contract and accepts its rights and obligations as described or referred to herein.

“Measurement Point” shall mean the location of the relevant collection site and

measurement devices required to measure Hydrocarbon Production from each

well.

“Month” shall mean a calendar month.

“Natural Gas” shall mean Wet gas, Dry gas, all other gaseous hydrocarbons and

all substances contained therein, which are produced from oil or gas wells,

excluding Liquid Hydrocarbons that condense naturally upstream of the

Measurement Point.

“Parties” shall mean Uzgeoneftegazdobycha, the Refining Agent, the Marketing

Agent and the Contractor. A “Party” shall mean any one of the Parties.



6



“Person” shall mean any individual, corporation, association, joint venture,

partnership, trust, limited liability company, joint-stock company, unincorporated

organization or government, or any agency or political subdivision thereof.

“Production” shall mean the Liquid Hydrocarbon production obtained from the

exploitation of the Field.

*[definition of commercial terms omitted]

"Release" shall mean any spill, discharge, leak, emission, injection, escape,

dumping, leaching, dispersal, emanation, migration or release of any Hazardous

Substance into the environment, including, without limitation, the abandonment

or discard of barrels, containers, tanks or other receptacles containing or

previously containing any Hazardous Substance.

“Takeover Date” shall mean the date on which the Contractor assumes control

and responsibility for any Contractor Well.

“Tonne” shall mean a quantity consisting of 1000 kilograms, corrected to a

temperature of 15 degrees Celsius under 101.3 kilo pascals of pressure (one

atmosphere).

“Transfer” shall mean any sale, assignment, delegation, transfer or other

disposition by any means (including by way of pledge or other similar

encumbrance) of all or any part of a Party’s rights or obligations under this

Contract; provided that “Transfer” shall not include a pledge of a Contractor’s

rights to receive the Contractor’s Allocation that (a) is made as part of a bona

fide financing transaction to enable a Contractor to perform the Operating

Services hereunder and (b) does not purport to delegate to the pledgee or any

other Person any of the Contractor’s other rights or obligations hereunder, or

give such pledgee or other Person any right to attach, seize or execute on the

Contractor’s participation or to transfer or convey all or any part of such

participation to any third party.

“Work Program and Budget” shall mean a Work Program and Budget for any

phase of the Operating Services prepared and submitted to the Operating

Committee in accordance with Clause 7, as amended or supplemented from

time to time in accordance with this Contract.

“$” or “Dollar(s)” shall mean the lawful currency of the United States of America.

CLAUSE 2 - OBJECTIVE

2.1

The objective of this Contract is to increase Production from certain

Hydrocarbon reservoirs within the Field by improving the efficiency of Field



7



development and by applying modern technologies and drilling and production

methods, subject to the terms and conditions set forth herein.

2.2

The Contractor shall conduct the Operating Services hereunder not for its

own account, but only for the accounts of Uzgeoneftegazdobycha and Refining

Agent subject to the terms and conditions set forth herein.

2.3

Uzgeoneftegazdobycha shall conduct the Transportation Services

hereunder for its own account and for the accounts of the Contractor and

Refining Agent subject to the terms and conditions set forth herein.

2.4

The Refining Agent shall conduct the Refining Services hereunder for its

own account and for the accounts of the Contractor and Uzgeoneftegazdobycha,

subject to the terms and conditions set forth herein.

2.5

2.6



*[contains commercial terms omitted]

*[commercial terms omitted]



CLAUSE 3 - OPERATING SERVICES

3.1

On the terms and subject to the conditions set forth in this Contract, the

Contractor undertakes to provide the following services (the “Operating

Services”) for Uzgeoneftegazdobycha and the Refining Agent:

(a)

to fulfill, at its sole risk and expense, to increase the Production of the

Field to the extent set out in the Development Plan by utilizing new drilling,

completion and production methods pursuant to the Development Plan; and

(b)

to provide any other service necessarily required to be provided by the

Contractor to fulfill its obligations under the Operating Services as set forth in this

Contract.

3.2

The Contractor and Uzgeoneftegazdobycha will measure Production at

the relevant Measurement Point.

3.3

Contractor will use its best efforts to ensure that Contractor Wells do not

adversely affect existing producing wells of Uzgeoneftegazdobycha which abut

Contractor Wells.

3.4



It is the understanding of the Parties that:



(a)

all activities involved in the provision of the Operating Services shall be

carried out by the Contractor for the accounts of Uzgeoneftegazdobycha and the

Refining Agent;

(b)

all costs incurred in the provision of the Operating Services by the

Contractor or one of its Associated Entities or subcontractors shall be funded



8



directly by the Contractor and not by Uzgeoneftegazdobycha or the Refining

Agent;

(c)

such costs shall be recoverable by the Contractor only from and to the

extent of Contractor’s Allocation as described herein; and

(d)

Upon notification by Contractor of its completion of Operating Services

with respect to a particular Contractor Well, Uzgeoneftegazdobycha shall

thereafter re-assume all operations relating to such well, including Production

operations, subject specifically to Clause 8.2 as well as all other provisions of

this Contract.

CLAUSE 4 –

*[commercial terms omitted]

CLAUSE 5 5.1



(a) (b) (c) (d) *[commercial terms omitted]



5.2



(a) *[commercial terms omitted]



(b)

Uzgeoneftegazdobycha shall advise the Contractor of all permits

and licenses which the Contractor and its subcontractors and suppliers require

under the laws of Uzbekistan to carry out the Operating Services and shall assist

in obtaining such permits and licenses. If, notwithstanding the fact that the

Contractor and its subcontractors and suppliers have fulfilled the requirements of

such permits and licenses, they are not granted, then the Contractor may

terminate this Contract in accordance with Clause 15.

5.3

Uzgeoneftegazdobycha shall undertake no actions which result in an

adverse impact on Production from the Contractor Wells, including, but not

limited to, any decision or action related to the reservoir or production facilities.

Subject to review and approval by the Operating Committee,

Uzgeoneftegazdobycha shall compensate the Contractor by calculating the

Production which otherwise would have been achieved and applying that

calculation to increase the Contractor’s Allocation accordingly.

5.4

(a)

Uzgeoneftegazdobycha shall allow the Contractor to use, in

activities relating to the Operating Services, all of its rights to the use of land,

rights of way and rights of passage, water rights, and other rights of any nature

whatsoever relating to the Field until the termination of this Contract in

accordance with Clause 15. The Contractor shall be entitled to use such rights

solely in connection with activities relating to the Operating Services, and may

not use them for any other purpose or transfer or otherwise dispose of such

rights in any manner without the prior consent of Uzgeoneftegazdobycha. Such



9



rights in respect of activities relating to the Operating Services are granted to the

Contractor with respect to the Field on an exclusive basis. However, in no event

will the exercise of such rights by the Contractor imply any assignment of title on

the part of Uzgeoneftegazdobycha, nor will it deprive Uzgeoneftegazdobycha of

the use of such rights so far as such use does not in any way interfere with the

activities contemplated in this Contract. Uzgeoneftegazdobycha shall provide all

reasonable assistance to the Contractor upon request in securing such rights to

facilitate the orderly provision of the Operating Services. Contractor shall not be

required to compensate Uzgeoneftegazdobycha for the use of such rights.

(b)

Uzgeoneftegazdobycha shall be obligated to supply to the Contractor

Natural Gas, fuel, water and electric power of the quality and in the quantity as

required by the Contractor for the purpose of conducting Operating Services,

including, but not limited to, Natural Gas for purposes of gas lift. Contractor shall

not be required to compensate Uzgeoneftegazdobycha for supplying such items

beyond the implicit compensation calculated in the deemed Dollar value per

tonne product price of Contractor’s Allocation as specified in Clause 24.12

herein.

5.5

Uzgeoneftegazdobycha shall use its best efforts to ensure that its

operations and activities do not in any way conflict or interfere with those of the

Contractor in performing the Operating Services.

5.6

All contracts or other arrangements for the furnishing of goods or services

to the Contractor or any Associated Entity of the Contractor shall be on terms

that would be no less favorable to the Contractor than the terms that could

reasonably be obtained in respect of a similar contract or arrangement between

the providers of such goods or services and Uzgeoneftegazdobycha.

5.7

The Contractor will be required to contract for any required goods or

services in such a manner as to ensure that it obtains the most advantageous

cost in keeping with the objectives of this Contract, and to take into account both

quality as well as delivery time for such goods or services, and the consultation

of the Operating Committee. In cases where there is a supply of both Uzbekistan

goods or services (i.e. such goods as are manufactured in Uzbekistan) as well as

non-Uzbekistan goods or services (including goods or services available from

Uzgeoneftegazdobycha), the participation of such Uzbekistan goods or services

in the bidding or contracting process must be assured, and when such

Uzbekistan goods or services are equivalent in cost, quality and delivery time to

the non-Uzbekistan goods or services, the Contractor will acquire such

Uzbekistan goods or services. In any event, in order to guarantee the optimal

quality of the goods or services acquired, any non-Uzbekistan supplier of goods

or services must comply with the same requirements as are imposed on any

Uzbekistan supplier of goods or services. For the purposes of this clause,

Uzbekistan goods or services will be understood to mean those goods or

services supplied by offices or plants that provide such goods or services in

Uzbekistan.



10



5.8

The Contractor shall be responsible for engaging employees,

subcontractors, agents and other representatives in the course of the Operating

Services. The Contractor shall be exclusively responsible for the performance of

the obligations assumed in respect of employees (if any) performing the

Operating Services by virtue of any law or regulation of Uzbekistan relating to the

relations between employers and employees. The Contractor will not have any

obligation to engage any current employees of Uzgeoneftegazdobycha or any of

its Associated Entities, subcontractors or agents.

CLAUSE 6 –

*[commercial terms omitted]

CLAUSE 7 –

*[financial and commercial terms omitted]

CLAUSE 8 - PRODUCTION MEASUREMENT AND VALUATION

8.1

“Baseline Production” shall mean, for any Month, a volume of Production

of Liquid Hydrocarbons in such Month, determined as follows:

(a)

for a new well or re-work or re-drill of an existing well which was previously

shut in or was a non-producing well, such Baseline Production shall be zero so

that all Production from such a well shall be Incremental Production.

(b)



*[commercial terms omitted]



8.2

For information purposes only, Contractor shall have the right to access

and copy any data relating to the Field during the term of this Contract.

8.3

Contractor agrees to use modern reservoir engineering practices in

carrying out the Work Program with the aim of minimizing the impact on the

existing operations of Uzgeoneftegazdobycha which abut the Contractor Wells.

In the event that Production from existing Uzgeoneftegadobycha wells falls into

decline, and it can be proved that the decline occurred as a direct result of

Contractor's Work Program, then Contractor shall, with the approval of the

Operating Committee, undertake repair operations of such wells, at its sole cost,

to return production to the same level as it was immediately before Contractor

began the Work Program.

8.4

For purposes of calculating the Contractor’s Allocation, the volume of all

Liquid Hydrocarbons will be measured at the relevant Measurement Point.

Uzgeoneftegazdobycha shall provide the Contractor with a description of its

Production measurement, testing and allocation procedures for the Field. The



11



Contractor may observe Uzgeoneftegazdobycha

measurements of the Production of such wells.

8.5



in



the



conduct



of



*[commercial terms omitted]



CLAUSE 9 - INSURANCE

9.1

Prior to commencing any Operating Services and for so long as any

Operating Services are conducted, the Contractor will be required to provide

Uzgeoneftegazdobycha and the Refining Agent with satisfactory evidence that it

has obtained and is maintaining in force any insurance required by Uzbekistan

law.

9.2

Prior to commencing the Transportation Services and for so long as any

Transportation Services are conducted, Uzgeoneftegazdobycha will be required

to provide Contractor with satisfactory evidence that it has obtained and is

maintaining in force any insurance required by Uzbekistan law.

9.3

Prior to commencing the Marketing Services and upon execution of the

Marketing Agent Agreement, and for so long as any Marketing Services are

conducted,

the

Marketing

Agent

will

be

required

to

provide

Uzgeoneftegazdobycha, the Contractor and the Refining Agent with satisfactory

evidence that it has obtained and is maintaining in force any insurance required

by Uzbekistan law.

9.4

Prior to commencing the Refining Services and for so long as any

Refining Services are conducted, Refining Agent will be required to provide

Contractor with satisfactory evidence that it has obtained and is maintaining in

force any insurance required by Uzbekistan law.

CLAUSE 10 - WARRANTY AND INDEMNITY

10.1 Contractor shall have no responsibility for any equipment, plant or

materials supplied by Uzgeoneftegazdobycha or any of Uzgeoneftegazdobycha’s

other contractors or suppliers. With regard to equipment, plant or materials

furnished by third-party suppliers of Contractor, all such equipment, plant or

materials shall be fit for purpose, and Contractor’s sole obligation shall be limited

to

the

assignment

of

such

third-party

supplier's

warranty

to

Uzgeoneftegazdobycha. Contractor’s sole obligation in performance of the

Operating Services carried out in the Contract shall be strictly limited to such

warranties included in subcontractor or third-party supplier contracts with

Contractor for any services, equipment, plant, or materials used in performance

of the Operating Services, in accordance with Clause 5.8. Contractor shall

supply such warranties from third-party suppliers of Contractor upon request of

Uzgeoneftegazdobycha.



12



10.2 In making interpretations of data, Contractor's employees will give

Uzgeoneftegazdobycha the benefit of their best judgment as to the correct

interpretation, but Contractor cannot and does not guarantee the accuracy or

correctness of these interpretations.

10.3 (a) Uzgeoneftegazdobycha shall provide Contractor with all information

concerning well conditions required for the safe and efficient performance of the

equipment of Contractor. Uzgeoneftegazdobycha shall notify Contractor of any

hazardous or unusual circumstances existing in the well in advance of actual

operation of the equipment. The equipment shall be fit for purpose and shall not

be operated, serviced, altered, or in any way modified, without prior written

approval of Contractor. Notwithstanding anything contained in these terms and

conditions to the contrary, in the event equipment of Contractor, its

subcontractors or its Associated Entities is lost, destroyed, damaged beyond

repair, or abandoned, regardless of the cause, unless caused by the sole

negligence of Contractor, any loss incurred as a result of said equipment being

lost, damaged beyond repair, or abandoned, shall be reimbursed to Contractor

by Uzgeoneftegazdobycha. Lost equipment subsequently recovered shall be

returned to Contractor. Any residual value to such returned equipment shall be

credited by Contractor to Uzgeoneftegazdobycha. In the event Contractor’s

equipment is damaged, but, in the sole opinion of the Contractor is repairable,

Uzgeoneftegazdobycha shall reimburse Contractor the repair cost as applicable

herein for any such damage to Contractor’s equipment. All rights in and to

equipment shall at all times remain that of Contractor, notwithstanding payment

of losses.

(b) Uzgeoneftegasdobycha shall not be responsible for storage and

exploitation of Contractor's equipment.

10.4



*[commercial terms omitted]



10.5.1 Contractor shall defend, indemnify, and hold Uzgeoneftegazdobycha

Group and Marketing Agent Group harmless from and against any and all

claims, liabilities, damages, and expenses (including without limitation attorneys'

fees and other costs of defense), for all injuries to, deaths, or illnesses of

persons within Contractor Group, when arising out of or incidental to this

Contract, the Operating Services, the Transportation Services, the Refining

Services and the Marketing Services, regardless of how, when or where such

loss, damage, injury or death occurs, irrespective of insurance coverages

whether or not occasioned by or the result in whole or in part of the negligence of

fault,

whether

sole,

concurrent,

joint,

active,

or

passive,

of

Uzgeoneftegazdobycha Group and/or Marketing Agent Group or the unseaworthiness of any vessel or un-airworthiness of any aircraft.

10.5.2 Uzgeoneftegazdobycha shall defend, indemnify, and hold Contractor

Group and Marketing Agent Group harmless from and against any and all

claims, liabilities, damages, and expenses (including without limitation attorneys'



13



fees and other costs of defense), irrespective of insurance coverages, for the

following, when arising out of or incidental to this Contract, the Operating

Services, the Transportation Services, the Refining Services and the Marketing

Services:

(i)



all injuries to, deaths, or illnesses

Uzgeoneftegazdobycha Group, and



of



persons



within



(ii)



all damages to or losses of property belonging to any member of

the Uzgeoneftegazdobycha Group,



whether or not occasioned by or the result in whole or in part of the negligence or

fault, whether sole, concurrent, joint, active, or passive, of Contractor Group

and/or Marketing Agent Group or the un-seaworthiness of any vessel or unairworthiness of any aircraft.

10.5.3 Marketing Agent, pursuant to Marketing Agent Agreement, shall defend,

indemnify, and hold the Contractor Group and Uzgeoneftegazdobycha Group

harmless from and against any and all claims, liabilities, demands (including

without limitation attorneys' fees and other costs of defense), irrespective of

insurance coverages, for the following, when arising out of or incidental to this

Contract, the Operating Services, the Transportation Services, the Refining

Services and the Marketing Services:

(i)



all injuries to, deaths, or illnesses of persons within Marketing

Agent Group, and



(ii)



all damages to or losses of property belonging to any member of

the Marketing Agent Group,



whether or not occasioned by or the result in whole or in part of the negligence or

fault, whether sole, concurrent, joint, active, or passive, of Contractor Group

and/or Uzgeoneftegazdobycha Group or the un-seaworthiness of any vessel or

un-airworthiness of any aircraft.

10.6 Uzgeoneftegazdobycha shall defend, indemnify, and hold the Contractor

Group and Marketing Agent Group harmless from and against all claims,

liabilities, demands, causes of action and judgments (including without limitation

attorneys’ fees and other costs of defense) of every kind for damage to or loss of

property of Thirds Parties, and injuries to or deaths of Third Parties, caused by,

resulting from, arising out of or incidental to this Contract, the Operating

Services, the Transportation Services, the Refining Services, the Transportation

Services, the Refining Services and the Marketing Services regardless of how,

when or where such loss, damage, injury or death occurs, irrespective of

insurance coverages whether or not occasioned by or the result in whole or in

part of the negligence or fault, whether sole, concurrent, joint, active, or passive,



14



of Contractor Group and/or Marketing Agent Group or the unseaworthiness of

any vessel or unairworthiness of any aircraft.

10.7 Uzgeoneftegazdobycha shall defend, indemnify, and hold Contractor

Group harmless for loss of or damage to any geological formation, strata, or oil

or gas reservoir, or in respect of the escape of such oil and gas from a reservoir,

whether or not such loss or damage or escape is caused by Contractor Group's

active, passive, concurrent or solely negligent acts or omissions.

10.8 In the event a well being drilled or reworked shall blowout or crater due to

Contractor’s active, passive or concurrent or solely negligent acts or omissions,

Contractor shall bear the cost of killing the well, drilling a relief well(s) or

otherwise bringing such well under control, and the costs of redrilling the well and

all associated costs of replacement casing, tubulars and other in-well equipment.

10.9 Contractor, at its sole cost and expense, shall correct and remediate all

damage caused by Contractor Group due to any fire, explosion, blowout or

cratering whether or not occasioned by or the result of the negligence or fault of

the Contractor Group. Uzgeoneftegazdobycha shall defend, indemnify, and hold

the Contractor Group harmless from and against all claims, liabilities, demands,

causes of action and judgments (including without limitation attorneys' fees and

other costs of defense) of every kind arising out of or in connection with any such

event whether or not occasioned by or the result in whole or in part of the

negligence or fault, whether sole, concurrent, joint, active, or passive, of

Contractor Group beyond the cost and expense of such corrective work and

remediation.

10.10 Contractor, at its sole cost and expense, shall correct and remediate all

damage arising out of or in conjunction with any pollution or contamination of any

kind or nature caused by Contractor Group, including but not limited to

radioactive contamination, together with all costs of clean up, containment and

de-contamination whether or not occasioned by or the result in whole or in part of

the negligence or fault, whether sole, concurrent, joint, active, or passive, of

Contractor Group. Uzgeoneftegazdobycha shall defend, indemnify, and hold the

Contractor Group harmless from and against all claims, liabilities, demands,

causes of action and judgments (including without limitation attorneys' fees and

other costs of defense) of every kind arising out of or in connection with any such

pollution or contamination whether or not occasioned by or the result in whole or

in part of the negligence or fault, whether sole, concurrent, joint, active, or

passive, of Contractor Group beyond the cost and expense of such corrective

work and remediation.

10.11 Notwithstanding anything to the contrary contained in this Contract, in no

event shall any Party be liable to any other Party for any consequential damages

or lost profits that such other Party may suffer. The Parties acknowledge that this

Clause is intended only to limit their liability to one another for consequential loss



15



or damage, and shall not be construed so as to limit their liability to Third Parties

or their right to seek indemnification for third party claims in accordance with any

other Clause.

CLAUSE 11 - TITLE TO AND USE OF FIXED ASSETS

11.1 The Contractor shall have exclusive title to (or, in the case of capital

leases, shall be the named lessee of) all facilities, properties, equipment and

other assets used by the Contractor to perform Operating Services hereunder,

except for fixed assets owned by Uzgeoneftegazdobycha prior to the Effective

Date or subsequently purchased by Uzgeoneftegazdobycha.

11.2 The Contractor shall have the right, but not the obligation, to use, in

connection with the Operating Services, all existing wells in the Field, the flow

lines between such wells and gathering stations and all electricity lines, gas lines

and water lines between the appropriate Measurement Point and such wells, in

addition to certain other fixed assets in the Field or outside the Field that are

appropriate for the Operating Services, that are owned or leased by

Uzgeoneftegazdobycha or its Affiliates. In addition, as part of the Work Program,

the Project Manager will work with Uzgeoneftegazdobycha to create a list of such

Uzgeoneftegazdobycha

assets

that

the

Contractor

can

use.

Uzgeoneftegazdobycha warrants the condition and specification of these assets

as being in good condition and fit for use in connection with the Operating

Services, and Uzgeoneftegazdobycha shall repair or replace any of such assets

that may be damaged, destroyed or lost, regardless of the cause of such

damage, loss or destruction. The Contractor shall have no right to use any

assets described in this Clause 11.2 for any purpose other than for use directly in

connection with the Operating Services. Contractor shall not be required to

compensate Uzgeoneftegazdobycha for the use of such fixed assets of

Uzgeoneftegazdobycha beyond the implicit compensation calculated in the

deemed Dollar value per tonne product price of Contractor’s Allocation as

specified in Clause 24.12 herein.

11.3 The Contractor shall safeguard and maintain in good condition, subject to

normal wear and tear, all assets that the Contractor uses in accordance with

Clause 11.2. The Contractor shall not sell, lease or otherwise dispose of any

asset that the Contractor uses in accordance with Clause 11.2 without the prior

approval of Uzgeoneftegazdobycha.

CLAUSE 12 - *[commercial terms omitted]

CLAUSE 13 - OTHER PAYMENTS TO GOVERNMENT AND JSC

UZGEONEFTEGAZDOBYCHA

13.1 Payments to which Contractor and its Associated Entities and its foreign

contractors shall be subject shall be as set forth in the Decree.



16



13.2 The Parties agree that Contractor shall have no obligation to make any

royalty, bonus or other payments to Uzgeoneftegazdobycha or its Affiliates or the

Government of the Republic of Uzbekistan in cash, production or services,

except as expressly set forth in this Contract. Specifically, Contractor shall not be

obligated to pay any annual bonus, signing bonus, severance fees or transferback costs to Uzgeoneftegazdobycha or its Affiliates or the Government.

13.3



*[fiscal terms omitted]



CLAUSE 14 - ACCOUNTING AND AUDIT

14.1 Contractor shall be responsible for keeping complete books and accounts

with the assistance of Uzgeoneftegazdobycha reflecting all Contractor’s

expenses, the calculated value of Incremental Production and the Contractor’s

Allocation, consistent with international accounting standards as applied to such

production enhancement contracts.

14.2 Refining Agent shall be responsible for keeping complete books and

accounts reflecting the amounts of Hydrocarbons of the Contractor’s Allocation

and that of the Uzgeoneftegazdobycha and Refining Agent share of Incremental

Production received from Uzgeoneftegazdobycha and respective amounts of

refined products released to the Marketing Agent.

14.3 Marketing Agent pursuant to Marketing Agent Agreement, shall be

responsible for keeping complete books and accounts reflecting all revenue

generated from the sale of the Contractor’s Allocation and that of the

Uzgeoneftegazdobycha and Refining Agent share of Incremental Production.

14.4 Following the end of each Calendar Year, the statements and accounts

for such Calendar Year will be audited, at the expense of Contractor, by an

international auditing firm selected by Contractor and, unless disputed by any of

the Parties, any adjustments found by such auditors will be reflected in the

statement or invoice immediately following the delivery of the report of the

auditors.

14.5 All Contractor books will be maintained in Dollars, and only if required, in

any local currency. All Uzgeoneftegazdobycha books will be maintained in

Uzbekistan soum, and, only if required, in Dollars.

CLAUSE 15 - TERM AND TERMINATION; EXTENSIONS

15.1 The term of this Contract shall begin on the Effective Date and, subject to

the terms of Clauses 15.3 and 15.4, terminate eight (8) years from the date of

the first Incremental Production from the final Contractor Well.

15.2 Notwithstanding the termination of this Contract, Marketing Agent,

pursuant to Marketing Agent Agreement, shall continue to pay to



17



Uzgeoneftegazdobycha, the Contractor and the Refining Agent all monies due in

respect of the sale and monetization of the Incremental Production as set out in

Clause 24 herein until all amounts due to Uzgeoneftegazdobycha, the Contractor

and the Refining Agent in terms of Clause 24 are fully paid.

15.3 The term of the Contract may be extended by the Contractor with the

approval of the other Parties upon request made by the Contractor at least six

months prior to the date on which the Contract would otherwise expire. The other

Parties may grant or deny such request at their discretion or transfer their rights

and obligations under this Contract to another entity approved by

Uzgeoneftegazdobycha and Contractor.

15.4 (a) The Contractor will be entitled to terminate this Contract prior to the

termination date specified in Clause 15.1, by notice in writing to the other Parties

(i) pursuant to Clauses 15.5, 4.3, 5.2 (b), 25.1, 25.2, and 25.7, (ii) upon the

breach of any representation or warranty of any of the other Parties, (iii) upon the

failure of any of the other Parties to comply with their covenants in this Contract,

or (iv) upon the breach of UNG of the Guarantee Agreement. In the event of any

such termination, the Contractor shall have no other liability or claims to the other

Parties, but shall be entitled to receive all of the proceeds of its allocation that is

extracted prior to the termination of the Contract and all other fees that it accrues

prior to the termination of the Contract.

(b) Uzgeoneftegasdobycha will be entitled to terminate this Contract prior

to the termination date specified in Clause 15.1, by notice in writing to Contractor

(i) upon the breach of any representation or warranty of the Contractor, (ii) upon

the failure of Contractor to comply with its covenants in this Contract. In the

event of any such termination, Uzgeoneftegasdobycha shall have no other

liability or claims to Contractor, but shall be entitled to receive all of the proceeds

of its allocation that is extracted prior to the termination of the Contract and all

other fees that it accrues prior to the termination of the Contract.

15.5. Notwithstanding any other provision of this Contract to the contrary, in the

event that the first newly-drilled Contractor Well is deemed by the Contractor in

its sole discretion to be un-commercial, then Contractor may elect to terminate

this Contract on giving 15 (fifteen) days written notice to the other Parties. In

such event, the Parties agree that any production from such well will be

exclusively

for

the

benefit

of

Uzgeoneftegazdobycha,

and

Uzgeoneftegazdobycha shall have no further obligation to share production or

pay the Contractor Allocation, however, in the event of such termination, the

Contractor shall have no other liability to the other Parties or their Associated

Entities.

CLAUSE 16 - CONTRACTOR WELLS



18



16.1 Prior to the Takeover Date, Contractor shall have no liability for any well in

the Field. A well shall cease to be a Contractor Well as provided in Clause 16.2.

16.2 In the event that the Contractor advises the Operating Committee that it

no longer intends to perform any Operating Services on a Contractor Well,

Contractor shall plug and abandon such well at its own expense, or

Uzgeoneftegazdobycha shall immediately assume responsibility for such well. In

the latter such event:

(a)

the Contractor shall not plug and abandon such well, and

Uzgeoneftegazdobycha shall assume responsibility for such well and at that

time, such well shall cease to be a Contractor Well; and

(b)

Uzgeoneftegazdobycha may plug and abandon such well or retain such

well for possible future use for production or otherwise all at

Uzgeoneftegazdobycha’s sole cost, risk and expense, except that

Uzgeoneftegazdobycha may not during the term of this Contract use such well to

drill to a target zone within the Field which is a target within the Development

Plan.

In either event, the Contractor shall have no liability for any costs, expenses or

damages arising out of or based upon the improper use or plugging and

abandoning of such well, and Uzgeoneftegazdobycha shall indemnify and hold

harmless the Contractor from and against, any costs, expenses (including

without limitation reasonable legal costs, expenses and attorneys’ fees),

damages and liabilities incident to claims, demands or causes of action of every

kind and character brought by or on behalf of any Person, for damage to or loss

of property or the environment, or for injury to, illness or death of any Person, in

each case to the extent such costs, expenses, damages and liabilities arise from

or are based upon the improper use or plugging and abandoning of such well by

Uzgeoneftegazdobycha.

CLAUSE 17 - ENVIRONMENTAL MATTERS

17.1 The Parties shall observe all Environmental Laws of the Republic of

Uzbekistan when performing their respective obligations under this Contract and

shall use their reasonable endeavors, so far as consistent with performing the

Operating Services in accordance with International Oil Industry Standards, to

protect the natural resources and to avoid pollution and damage to the

environment.

17.2 Notwithstanding the provisions of Clause 17.1, the Contractor shall have

no liability for any Environmental Claim, other than as set out in Clause 17.3,

arising in connection with the Operating Services and Uzgeoneftegazdobycha

shall indemnify and hold harmless the Contractor Group against any such

Environmental Claim whether or not occasioned by or the result in whole or in



19



part of the negligence or fault, whether sole, concurrent, joint, active, or passive,

of Contractor Group. In the event that the Contractor is threatened with, or

believe they may be liable for, any Environmental Claim, they shall promptly

notify Uzgeoneftegazdobycha. Uzgeoneftegazdobycha will promptly reimburse

the Contractor for any Environmental Claim that they may suffer or incur.

17.3 Contractor shall indemnify and hold harmless Uzgeoneftegazdobycha,

Refining Agent and Marketing Agent for control and removal of pollution or

contamination which originates above the surface of the land from spills of oils,

lubricants, motor oils, normal water base drilling fluid and attendant cuttings, pipe

dope, paints, solvents, ballast, bilge and garbage wholly in Contractor’s

possession and control and directly associated with Contractor’s equipment and

facilities.

17.4 Notwithstanding the provisions of Clause 17.1, the Contractor shall have

no liability for any Environmental Claim arising in connection with the

Transportation Services and Uzgeoneftegazdobycha shall indemnify and hold

harmless the Contractor Group and the other Parties against any such

Environmental Claim whether or not occasioned by or the result in whole or in

part of the negligence or fault, whether sole, concurrent, joint, active, or passive,

of Contractor Group. In the event that the Contractor is threatened with, or

believe they may be liable for, any Environmental Claim, they shall promptly

notify Uzgeoneftegazdobycha. Uzgeoneftegazdobycha will promptly reimburse

the Contractor for any Environmental Claim that they may suffer or incur.

17.5 Notwithstanding the provisions of Clause 17.1, the Contractor shall have

no liability for any Environmental Claim arising in connection with the Refining

Services and the Refining Agent shall indemnify and hold harmless the

Contractor Group and the other Parties against any such Environmental Claim

whether or not occasioned by or the result in whole or in part of the negligence or

fault, whether sole, concurrent, joint, active, or passive, of Contractor Group. In

the event that the Contractor is threatened with, or believe they may be liable for,

any Environmental Claim, they shall promptly notify the Refining Agent. Refining

Agent will promptly reimburse the Contractor for any Environmental Claim that

they may suffer or incur.

17.6 Notwithstanding the provisions of Clause 17.1, the Contractor,

Uzgeoneftegazdobycha and the Refining Agent shall have no liability for any

Environmental Claim arising in connection with the Marketing Services and

Marketing Agent shall indemnify and hold harmless the Contractor Group, the

Uzgeoneftegazdobycha Group and the Refining Agent Group against any such

Environmental Claim whether or not occasioned by or the result in whole or in

part of the negligence or fault, whether sole, concurrent, joint, active, or passive,

of Contractor Group, the Uzgeoneftegazdobycha Group and/or the Refining

Agent Group. In the event that the Contractor, Uzgeoneftegazdobycha or

Refining Agent are threatened with, or believe they may be liable for, any



20



Environmental Claim, they shall promptly notify Marketing Agent. Marketing

Agent will promptly reimburse the Contractor, Uzgeoneftegazdobycha and/or the

Refining Agent for any Environmental Claim that they may suffer or incur.

17.7 Any Natural Gas produced from the Operating Services, to the extent not

used in operations hereunder, may be flared if the processing or utilization

hereof is not economical. Such flaring shall be permitted to the extent that gas is

not required to effectuate the economic recovery of Hydrocarbons by secondary

recovery operations, including repressuring and recycling.

CLAUSE 18 - GOVERNING LAW AND ARBITRATION

18.1 This Contract shall be governed by and construed in accordance with the

laws of Sweden excluding conflict rules and choice of law principles.

18.2 (a)

Any dispute arising out of or concerning this Contract shall be

settled exclusively and finally by arbitration. The arbitration shall be conducted

and finally settled in accordance with the Rules of Conciliation and Arbitration of

the International Chamber of Commerce (the “ICC Rules”). All arbitration

proceedings under this Contract shall be conducted in Stockholm in Sweden.

The arbitration proceedings shall be conducted in the English language. The

English version of this Contract signed by the Parties shall be used as the official

transaction in such proceedings and as the exclusive basis for determining the

agreement of the Parties with respect to any matter considered therein. Any

decision or award of the arbitral tribunal shall be final and binding upon the

Parties. Judgment for execution of any award rendered by the arbitral tribunal

may be entered by any court of competent jurisdiction without review of the

merits of such award. To the extent permitted by law, any rights to appeal from

or to cause a review of any such award by any court or tribunal are hereby

waived by the Parties.

(b)

To the extent that any Party has or hereafter may acquire any immunity

from jurisdiction of any court or from attachment in aid of execution of any other

legal process (other than pre-judgment attachment) in any action or proceeding

conducted pursuant to this Clause 18.2 (including any proceeding for the

enforcement of an arbitral judgment) with respect to itself or any of its assets, the

Party and any of its Associated Entities hereby irrevocably agrees not to invoke

such immunity as a defense, and irrevocably waives such immunity.

18.3 The Parties also acknowledge the applicability of any international treaties

relating to the mutual protection of foreign investment to which both Uzbekistan

and any country of which a Contractor or a guarantor thereof is a national may

now be or hereafter become parties.

CLAUSE 19 - OWNERSHIP OF TECHNOLOGY, INFORMATION AND DATA



21



19.1 To the fullest extent permitted by applicable law or agreements, the

Contractor agrees to make available on reasonable commercial terms their most

appropriate technical expertise and technology for use in the provision of the

Operating Services, including such technology as can best improve the

economic yield or recovery of the Hydrocarbon reservoirs developed and

operated by the Contractor under this Contract.

19.2 Any technology specifically developed by the Contractor during the course

of its activities under this Contract shall be owned by the Contractor. All

geological, geophysical and other data, as well as all other information

developed in the course of the activities contemplated by this Contract (other

than technology specifically developed by the Contractor) will be owned by

Uzgeoneftegazdobycha, but may be used free of charge by the Contractor in

connection with the Operating Services during the term of this Contract.

19.3 Subject to Clause 20, Uzgeoneftegazdobycha shall have reasonable

access to all data, records and information used or produced by or for the

Contractor in connection with the Operating Services, regardless of whether such

data, records and information would otherwise be considered proprietary or

confidential, and shall have the right to inspect or cause to be inspected any and

all facilities used in the Operating Services during regular business hours in a

manner that will not materially interfere with the provision of the Operating

Services. Uzgeoneftegazdobycha shall not be entitled to use, or to permit its

representatives or any other Person to use, for any purpose whatsoever, any

proprietary information of any Contractor or any of its respective Associated

Entities that is inspected pursuant to this Clause 19.3.

CLAUSE 20 - CONFIDENTIALITY

20.1 All data, records and information referred to in Clause 19.2, and any other

information exchanged between the Parties in connection with this Contract,

including the terms and conditions of this Contract, (“Confidential Information”)

shall be treated as confidential by the party receiving such information (the

“Receiving Party”), and shall not be disclosed by it to any third party unless the

party that provided such information, data or materials (the “Disclosing Party”)

has given its prior consent to such disclosure.

20.2 Each Receiving Party may disclose such Confidential Information to any

of its officers, directors, employees, Associated Entities, agents, subcontractors

and advisors who (a) has a need to know the same in connection with carrying

out the Operating Services and (b) has been advised of, and agrees to comply

with, the restrictions upon such Confidential Information set forth in this Contract

as if it were a Receiving Party.



22



20.3 Notwithstanding the foregoing, the Receiving Party may disclose

Confidential Information to a third party without the Disclosing Party’s prior

written consent to the extent such information:

(a)

is already known to the Receiving Party as of the date of disclosure

other than as a result of a breach of this Clause 20;

(b)

is already in possession of the public or becomes available to the

public other than through the act or omission of the Receiving Party;

(c)

is developed independently by the Receiving Party without the use

of any Confidential Information;

(d)

is acquired independently from a third party, which is under no legal

obligation known to the Receiving Party prohibiting such disclosure; or

(e)

is required to be disclosed pursuant to any applicable law, decree,

regulation, rule or order of any competent authority.

In the event that any Receiving Party is required by applicable law, decree,

regulation, rule or order of any competent authority to disclose any Confidential

Information supplied to it by any Disclosing Party, the Receiving Party shall

promptly notify in writing the Disclosing Party, so that the Disclosing Party may

seek an appropriate protective order and/or waive the Receiving Party’s

compliance with the confidentiality requirement. In the event that such protective

order or other remedy is not obtained, then the Receiving Party shall furnish only

that portion of such Confidential Information that is legally required to be

disclosed.

20.4 Notwithstanding the foregoing, the Contractor may disclose Confidential

Information to any Person with whom such Contractor enters into bona fide

negotiations for the Transfer of an interest hereunder, or for the financing or

ensuring of any activities hereunder, or to their respective advisors, so long as

(a) the Confidential Information is limited to such information as the potential

transferee, financier, insurer or any such advisor, requires for purposes of

evaluating the proposed transaction, and (b) the potential transferee, financier,

insurer or advisor, agrees in writing to abide by confidentiality restrictions

identical to those set forth in this Clause 20.

20.5 All press releases, advertisements and other announcements or

publications by any Party or any of its Associated Entities involving information

relating to this Contract or the Operating Services must be approved by all other

Parties prior to distribution or dissemination, except to the extent such

announcements relate to emergency situations and are reasonably necessary for

the protection of the environment or health or safety.

CLAUSE 21 - FORCE MAJEURE

21.1 Failure of a Party to fulfill any obligation incurred under this Contract shall

be excused and shall not be considered a default hereunder during the time and

to the extent that such non-compliance is caused by an Event of Force Majeure,



23



except that if the Event of Force Majeure is an act of the Republic of Uzbekistan

that is not of general applicability, such Event of Force Majeure shall not

preclude an action for damages against Uzgeoneftegazdobycha and/or the

Refining Agent for the non-performance of the relevant obligation.

21.2 For the purposes of this Contract, an “Event of Force Majeure” shall mean

any event or circumstance, other than lack of finances or an inability to make

payment under this Contract for whatever reason, beyond the reasonable control

of and unforeseeable by the Party obligated to perform the relevant obligation, or

which, if foreseeable, could not be avoided in whole or in part by the exercise of

due diligence, including but not limited to strikes, boycotts, stoppages, lockouts

and other labor or employment difficulties, fires, earthquakes, tremor, landslides,

avalanches, floods, hurricanes, tornadoes, storms, other natural phenomena or

calamities, explosions, epidemics, wars (declared or undeclared), hostilities,

guerrilla activities, terrorist acts, riots, insurrections, civil disturbance, acts of

sabotage, blockades, embargoes, or acts of state or any governmental body. At

the request of the Parties, such “Event of Force Majeure” may be verified by an

independent third party agreed to by all the Parties to this Contract.

21.3 If any Party cannot comply with any obligation stipulated herein because

of an Event of Force Majeure, such Party shall notify the other Parties in writing

as promptly as possible giving the reason for non-compliance, particulars of the

Event of Force Majeure and the obligation or condition affected. Except as

provided in Clause 21.1, any obligation of a Party shall be temporarily

suspended during the period in which such Party is unable to perform by reason

of an Event of Force Majeure, but only to the extent of such inability to perform.

The obligations of the Parties to perform as provided by this Contract through

facilities not affected by the Event of Force Majeure shall continue. The Party

affected by the Event of Force Majeure shall promptly notify the other Parties as

soon as such event has been removed and no longer prevents it from complying

with its obligation, and shall thereafter resume compliance with the Contract.

21.4 The Party that has given notice of an Event of Force Majeure shall

endeavor to mitigate the effects of such Event of Force Majeure on the

performance of its obligations. Where an Event of Force Majeure continues for

more than sixty (60) days, the Parties shall meet to review the situation and its

implications for operations and to discuss the appropriate course of action in the

circumstances. If an Event of Force Majeure occurs that substantially impedes

the Operating Services, the term of this Contract shall be extended by an amount

of time equal to the period during which such event is in effect.

CLAUSE 22 – TRANSPORTATION SERVICES

22.1 On the terms and subject to the conditions set forth in this Contract,

Uzgeoneftegazdobycha undertakes to provide the following services as more



24



specifically set out in this Clause 22 (the “Transportation Services”) for the

Contractor and the Refining Agent:

(a)



the uplifting, transportation and related storage of the Contractor’s

Allocation to Refining Agent;



(b)



the delivery of the Contractor's Allocation together with the

Uzgeoneftegazdobycha and the Refining Agent shares of the

Incremental Production to Refining Agent; and



(c)



any other services reasonably required to ensure the efficient

transportation of the Incremental Production to Refining Agent.



22.2 All operations and activities relating to the provision of the Transportation

Services shall be carried out by Uzgeoneftegazdobycha in accordance with:

(i)



The laws of the Republic of Uzbekistan;



(ii)



The specific requirements of this Contract and the decisions of the

Operating Committee made pursuant to Clause 4; and



(iii)



International Oil Industry Standards.



22.3 Uzgeoneftegazdobycha shall uplift the Contractor’s Allocation at the time

the allocation is made, shall promptly notify the Refining Agent regarding the

timing and volumes of Incremental Production available for Refining Services

and shall thereafter transport the Contractor’s Allocation together with its own

share of Incremental Production and that of the Refining Agent to the Fergana

refinery for refining. In addition, Refining Agent shall promptly notify Marketing

Agent regarding the timing and volumes of the products available for Marketing

Services as further defined in Clause 24, herein. Uzgeoneftegazdobycha shall, at

their sole cost and expense, arrange for any transportation or storage

necessarily required as part of the Transportation Services.

22.4 All costs and expenses incurred by Uzgeoneftegazdobycha in the

provision of the Transportation Services shall be funded directly by

Uzgeoneftegazdobycha. The Contractor shall have no liability for any such costs

and expenses.

CLAUSE 23 *[commercial and fiscal terms omitted]

CLAUSE 24 - MARKETING SERVICES

Contractor, Uzgeoneftegasdobycha, and the Refining Agent shall engage a

Marketing Agent to conduct Marketing Services, as described herein, and will

execute an agreement with Marketing Agent in the form attached to the Contract

as Annex F, whereby the Marketing Agent Agrrement shall include, but not be

limited to, the following provisions of this Clause 24.

24.1



*[commercial terms omitted]



25



CLAUSE 25 – JSC UZGEONEFTEGAZDOBYCHA UNDERTAKINGS

25.1 Uzgeoneftegazdobycha shall assist Contractor to ensure all privileges set

forth in the Decree are guaranteed during the term of this Contract.

25.2 Uzgeoneftegazdobycha shall register this Contract with all the appropriate

ministries and agencies as directed by the current law of Uzbekistan. The failure

to so register this Contract shall give Contractor the right, at its discretion, to

terminate this Contract in accordance with the terms of Clause 15.

25.3 Uzgeoneftegazdobycha shall facilitate the clearance through customs of

all material and equipment necessary to perform the Operating Services under

this Contract as requested by Contractor and its subcontractors.

Uzgeoneftegazdobycha shall, at the request of the Contractor or its

subcontractors, facilitate the re-export of any and all such material and

equipment that, in the sole opinion of the Contractor, is no longer necessary to

perform the Operating Services under this Contract.

25.4 Uzgeoneftegazdobycha shall, as requested by Contractor, facilitate and

assist Contractor and its subcontractors in obtaining any and all required

registration or certification of Contractor’s or its subcontractors’ material and

equipment necessary to perform the Operating Services under this Contract.

25.5 Uzgeoneftegazdobycha shall also facilitate and effect in its name the

clearance of all Contractor’s, its Associated Entities’ and subcontractors’

employees’ personal material shipments in order to allow such employees and

their families to establish temporary living accommodations.

25.6 Uzgeoneftegazdobycha shall arrange for all necessary employee work

permits and visas on behalf of Contractor and its subcontractors.

25.7 If any change in or to any Uzbekistan law, rule or regulation by any

authority results in a material change to the economic benefits accruing to any of

the Parties after the Effective Date, the Parties shall consult promptly to make

necessary revisions and adjustments to the Contract in order to maintain such

expected benefits to each of the Parties or Contractor may terminate the

Contract pursuant to Clause 15.



CLAUSE 26 - ASSIGNMENT; CHANGE IN CONTROL

26.1 The Contractor may not effect a Transfer to a Third Party without the prior

consent of the other Parties, which consent shall not be unreasonably withheld

or delayed. At least 30 days prior to any proposed Transfer, the Contractor shall



26



provide notice to the other Parties of the Transfer, including the name of the

proposed transferee and the participation to be transferred. Notwithstanding the

foregoing, the Contractor may effect a Transfer to any Associated Entity of the

Contractor without requiring the consent of the other Parties.

26.2 None of Uzgeoneftegazdobycha, the Refining Agent or the Marketing

Agent shall effect a Transfer without the prior written consent of the Contractor in

its sole discretion.

26.3 Upon the consummation of any Transfer by a Contractor, the transferee

shall be considered for all purposes a Contractor, with the participation in the

Field specified in the notice delivered to the other Parties pursuant to Clause 27.

26.4 Any purported Transfer by Uzgeoneftegazdobycha, the Refining Agent or

the Contractor that does not comply with this Clause 26 shall be null and void

and shall vest no rights in the purported transferee.

26.5 Nothing in this Clause 26 shall prohibit the Contractor from subcontracting

all or any portion of the activities involved in the Operating Services in

compliance with the terms of this Contract. The Contractor shall be fully

responsible for the performance of its obligations hereunder, notwithstanding any

such subcontracting arrangement (although the Contractor may agree with any

subcontractor on indemnity arrangements satisfactory to the Contractor and such

subcontractor).

CLAUSE 27 - NOTICES

27.1 All notices, demands, instructions, waivers, consents or other

communications to be provided pursuant to this Contract shall be in writing in

English and in Russian, shall be effective upon receipt, and shall be sent by

personal delivery, courier, facsimile or telex, to the following addresses:

*[commercial details omitted]

The addresses and telex and facsimile numbers for notices given pursuant to

this Contract may be changed by means of a notice given to the other Parties at

least fifteen (15) Business Days prior to the effective date of such change.

CLAUSE 28 - MISCELLANEOUS

28.1 This Contract contains the entire agreement between the Parties and

supersedes and replaces any oral or written communications or agreements

heretofore made between the Parties relating to the services. This Contract shall

not be amended except by a written instrument executed by the duly authorized

representatives of all Parties.



27



28.2 No benefit or right accruing to a Party under this Contract (or any

amendment or addendum thereto) shall be deemed to be waived unless the

waiver is in writing, expressly refers to this Contract, and is signed by a duly

authorized representative of all other affected Parties. A waiver in any one or

more instances shall not constitute a continuing waiver unless specifically so

stated in the written waiver.

28.3 If any provision (or portion thereof) of this Contract shall be declared

invalid, illegal or unenforceable, the remaining provisions shall not be affected

thereby, and this Contract shall be construed as if such invalid, illegal or

unenforceable provision (or portion thereof) had never been contained herein.

28.4 Nothing contained herein is intended to create, or shall be deemed or

construed as creating, any legal entity between the Parties. None of the Parties

shall have the authority or right, or hold itself out as having the authority or right,

to assume, create or undertake any obligation of any kind whatsoever, express

or implied, on behalf of or in the name of any other Party, except as expressly

provided herein. Except to the extent that the Contractor is to acquire goods and

services from third parties for the account of Uzgeoneftegazdobycha on a nonrecourse basis as provided herein, no provision in this Contract shall constitute

the Contractor, or any of its employees, subcontractors, agents or

representatives, as an employee, contractor, agent or representative of

Uzgeoneftegazdobycha. The Contractor shall be an independent contractor and

shall be responsible for and have control over the performance of the Operating

Services hereunder, subject to the standards set forth in this Contract.

28.5 Sections 10, 11, 12, 13, 15, 17, 18, 19 and 20 of this Contract survive

termination.

28.6 This Contract may be executed in one or more counterparts, each of

which shall be considered an original.

28.7 This Contract is being executed in both English and Russian languages.

Both the English and the Russian texts are binding and have the same force.

However, in the event of a dispute between the versions of this Contract, the

English version shall prevail.



28



This Contract has been executed by the Parties by their duly authorized

representatives as of the date set forth on the first page of this Contract.

Joint Stock Company UZGEONEFTEGAZDOBYCHA

By:

“signed”

Name:

Title:

By: “signed”

Name:

Title:

Baker Hughes (Cyprus) Limited

By: “signed”

Name:

Title:

Joint Stock Company UZNEFTEPERERABOTKA

By: “signed”

Name:

Title:

By: “signed”

Name:

Title:



29



ANNEX A

DESCRIPTION OF FIELD

The Field of interest, commonly known as the North Urtabulak Field, is a

hydrocarbon accumulation of the Kashkadarya Region, in the southwest portion

of Uzbekistan. The field lies approximately 150 kilometers west, northwest from

.DUVKLDWDSSUR[LPDWHO\ɽQRUWKODWLWXGHDQGɽHDVWORQJLWXGH

The reservoir of interest is a reef structure with a limestone section “above the

reef”. Average well depths are approximately 2500 m (8200 ft) total vertical

depth.



30



ANNEX B

*[commercial terms omitted]



31



ANNEX C

*[commercial and fiscal terms omitted]



32



ANNEX D

*[commercial and fiscal terms omitted]



33



ANNEX E

*[commercial and fiscal terms omitted]



34