Common use of Exploration Work Obligations Clause in Contracts

Exploration Work Obligations. 4.2.1 The Contractor shall, during each Exploration Phase, carry out the Exploration Work Obligations set out in Annex D. 4.2.2 Each of the Exploration Xxxxx provided in the Exploration Work Obligations shall be drilled to the minimum contractual depth specified in Annex D, or to a lesser depth if the continuation of drilling performed in accordance with Good International Petroleum Industry Practice is prevented for any of the following reasons: (i) basement is encountered at a lesser depth than the minimum contractual depth; (ii) continuation of drilling presents an obvious danger due to the existence of abnormal formation pressure; (iii) rock formations are encountered the hardness of which prevents, in practice, the continuation of drilling by the use of appropriate equipment; or (iv) Hydrocarbons formations are encountered the crossing of which requires, for their protection, the laying of casings preventing the minimum contractual depth from being reached. 4.2.3 In any of the above cases, the Contractor shall obtain prior approval of the Minister, prior to discontinuing drilling, which approval shall not be unreasonably withheld, and by this approval, the well shall be deemed to have been drilled to the above mentioned minimum contractual depth. The preceding sentence shall be without prejudice to the right of the Contractor to suspend drilling, having obtained the prior approval of the Minister, if such suspension is required under Good International Petroleum Industry Practice. 4.2.4 If the number of Exploration Xxxxx drilled by the Contractor during the Initial Licensing Period or the First Renewal Period exceeds the number of xxxxx provided for in the Exploration Work Obligation for the Exploration Phase in question, as specified in Annex D, the number of additional Exploration Xxxxx drilled during such Exploration Phase may be carried forward and treated as a credit towards the Exploration Xxxxx contained in the Exploration Work Obligation for the following Exploration Phase. 4.2.5 For purposes of Article 4.2.4, Appraisal Xxxxx drilled under an Appraisal Work Programme with respect to a Discovery shall not be considered as Exploration Xxxxx, and, in the event of a Hydrocarbons Discovery, only the Discovery Well shall be deemed to be an Exploration Well. 4.2.6 Upon the Effective Date, the Contractor shall provide to the Minister an irrevocable bank guarantee payable to the Permanent Secretary, Ministry of Energy, Commerce, Industry and Tourism, guaranteeing its Exploration Work Obligations for the Initial Licensing Period, for an amount determined as provided in Article 4.2.8. The bank guarantee shall be in form and content substantially as set forth in Annex E. The bank guarantee shall be issued by a bank licenced to operate in any of the following countries: the Republic of Cyprus, any member state of the European Union, any country of the EEA, any country that had signed the Government Procurement Agreement (GPA) and any country that had signed and ratified Association Agreements or Bilateral Agreements with the European Union or the Republic of Cyprus and has the right to do so, according to the legislation of those countries. 4.2.7 Any renewal of an authorization to explore in accordance with Article 4.3, shall be conditional upon the provision by the Contractor to the Minister of a similar guarantee, guaranteeing the Exploration Work Obligations for that renewal for an amount calculated in accordance with the provisions of Article 4.2.8, which has to be submitted within thirty (30) days from the date of renewal. 4.2.8 The amount of each guarantee shall be equal to twenty per cent (20%) of the total estimated costs of the Exploration Work Obligations of the relevant Exploration Phase, calculated by using the unit costs set forth as follows: (i) ( ) Euros per kilometre of 2D seismic survey to be performed; (ii) ( ) Euros per square kilometre of 3D seismic survey to be performed; (iii) ( ) million Euros per Exploration Well to be drilled. 4.2.9 If, upon expiry of the Initial Licencing Period or of the First Renewal Period the Contractor has failed to fulfil the applicable Exploration Work Obligations for the Exploration Phase in question, the Minister shall have the right to: (i) call on the guarantee as compensation for the non-performance of the Exploration Work Obligations and this Contract and the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in question; or (ii) give the option to the Contractor to pay the Republic eighty per cent (80%) of the total estimated costs of the unfulfilled Exploration Work Obligations within of the relevant Exploration Phase, calculated by using the unit costs per outstanding line- kilometre of 2D seismic survey, per outstanding square kilometre of 3D seismic survey and per outstanding Exploration Well as set forth in 4.2.8 above. If the Contractor exercises this option, and after the payment is received by the Minister, the Contractor shall be deemed to have fulfilled its Exploration Work Obligations for the relevant Exploration Phase under this Contract. 4.2.10 If, upon expiry of the Second Renewal Period, complete surrender or termination of the Contract, the Contractor has failed to fulfil the applicable Exploration Work Obligations for the Exploration Phase in question, the Minister shall call on the guarantee as compensation for the non-performance of the Exploration Work Obligations and this Contract and the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in question.

Exploration Work Obligations. 4.2.1 The 4.1. During the initial exploration period of ( ) Contract years provided in Article 3.1, the Contractor shall, during each Exploration Phase, : (a) carry out at least ( ) kilometres of seismic survey; the Exploration Work Obligations set out in Annex D.work with respect to such seismic survey shall commence within ( ) months from the Effective Date; and 4.2.2 Each (b) drill at least ( ) exploratory xxxxx; the first well shall commence within ( ) months from the Effective Xxxx. 4.2. During the second exploration period of the Exploration Xxxxx ( ) Contract Years provided in Article 3.2, the Exploration Work Obligations Contractor shall: (a) carry out at least ( ) kilometres of seismic survey; (b) drill at least ( ) exploratory xxxxx. 4.3. During the third exploration period of ( ) Contract Years provided in Article 3.2, the Contractor shall: (a) carry out at least ( ) kilometres of seismic survey; (b) drill at least ( ) exploratory xxxxx. 4.4. Each exploratory well set forth above shall be drilled to the minimum contractual depth specified in Annex Dof ( ) meters, or to a lesser depth if authorized by the continuation of Government or if discontinuing drilling performed in accordance with Good International Petroleum Industry Practice according to good international petroleum industry practice is prevented for any justified by one of the following reasons:; (ia) basement is encountered at a lesser depth less than the above-mentioned minimum contractual depth; (iib) continuation of continued drilling presents an obvious danger is manifestly dangerous due to the existence of abnormal formation pressure; (iiic) rock formations are encountered encountered, of which the hardness of which prevents, in practice, the continuation of makes impractical to continue drilling by the use of with appropriate equipment; or (ivd) Hydrocarbons petroleum formations are encountered encountered, requiring the crossing installation of protective casings which requires, for their protection, prevent reaching the laying of casings preventing the above-mentioned minimum contractual depth from being reached. 4.2.3 depth. In any of the above cases, the Contractor shall obtain prior approval of the Minister, prior to discontinuing drilling, which approval shall not be unreasonably withheldwithheld without being duly justified, and by this approval, the well in question shall be deemed to have been drilled to the above above-mentioned minimum contractual depth. 4.5. The preceding sentence shall be without prejudice to If either during the right of first exploration period or during the second exploration period provided in Articles 3.1 and 3.2 respectively, the Contractor to suspend drilling, having obtained the prior approval of the Minister, if such suspension is required under Good International Petroleum Industry Practice. 4.2.4 If the drills a number of Exploration Xxxxx drilled by exploratory xxxxx greater than the Contractor during the Initial Licensing Period or the First Renewal Period exceeds the number of xxxxx provided minimum drilling obligations specified for said period in the Exploration Work Obligation for the Exploration Phase in question, as specified in Annex DArticles 4.1 and 4.2 respectively, the number of additional Exploration Xxxxx drilled during such Exploration Phase excess exploration xxxxx may be carried forward and treated as a credit towards the Exploration Xxxxx contained in the Exploration Work Obligation for to the following Exploration Phase. 4.2.5 period(s) and shall be deducted from the minimum drilling obligations specified for said period(s), provided that at least one exploratory well shall be drilled during each renewal period of the exclusive exploration authorization. For purposes of Article 4.2.4Articles 4.1 to 4.5, Appraisal Xxxxx appraisal xxxxx drilled under an Appraisal Work Programme appraisal program with respect to a Discovery discovery shall not be considered as Exploration Xxxxx, exploratory xxxxx and, in the event of a Hydrocarbons Discoverypetroleum discovery, only the Discovery Well one well per discovery shall be deemed to be an Exploration Wellexploratory well. 4.2.6 4.6. Upon the Effective Date, the Contractor shall provide to the Minister an irrevocable bank guarantee payable acceptable to the Permanent Secretary, Ministry of Energy, Commerce, Industry and TourismMinister, guaranteeing its Exploration Work Obligations minimum work obligations for the Initial Licensing Period, for an amount determined as first initial exploration period provided in Article 4.2.84. 1. In the event of renewal of the exclusive exploration authorization, the Contractor shall also provide a similar guarantee guaranteeing the minimum work obligations for that renewal period. The bank amount of the guarantee shall be in form and content substantially as set forth in Annex E. The bank guarantee shall be issued by a bank licenced to operate in any of the following countries: the Republic of Cyprus, any member state of the European Union, any country of the EEA, any country that had signed the Government Procurement Agreement (GPA) and any country that had signed and ratified Association Agreements or Bilateral Agreements with the European Union or the Republic of Cyprus and has the right to do so, according to the legislation of those countries. 4.2.7 Any renewal of an authorization to explore in accordance with Article 4.3, shall be conditional upon the provision by the Contractor to the Minister of a similar guarantee, guaranteeing the Exploration Work Obligations for that renewal for an amount calculated in accordance with the provisions of Article 4.2.8, which has to be submitted within thirty (30) days from the date of renewal. 4.2.8 The amount of each guarantee shall be equal to twenty per cent (20%) of the total estimated costs of the Exploration Work Obligations of the relevant Exploration Phase, calculated by using the unit costs per km of seismic survey and per exploratory well set forth as follows: (ia) Dollars ( ) Euros per kilometre km of 2D seismic survey to be performed; ; (ii) ( ) Euros per square kilometre of 3D seismic survey to be performed; (iii) b)Dollars ( ) million Euros per Exploration Exploratory Well to be drilled. 4.2.9 . Three (3) months after completion of a seismic survey or an exploratory well drilled to the minimum contractual depth, the abovementioned guarantee shall be adjusted in such a manner as to guarantee the outstanding balance of the minimum contractual work obligations for the current exploration period, as valued in accordance with the provisions of the foregoing paragraph. If, upon expiry of any exploration period, or in the Initial Licencing Period event of whole relinquishment or termination of the First Renewal Period Contract, the Contractor exploration work has failed to fulfil not reached the applicable Exploration Work Obligations for the Exploration Phase minimum commitments prescribed in questionthis Article 4, the Minister shall have the right to: (i) to call on for the guarantee as a compensation for the non-performance of the Exploration Work Obligations and this Contract and work commitments entered into by the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in question; or (ii) give the option to the Contractor to pay the Republic eighty per cent (80%) of the total estimated costs of the unfulfilled Exploration Work Obligations within of the relevant Exploration Phase, calculated by using the unit costs per outstanding line- kilometre of 2D seismic survey, per outstanding square kilometre of 3D seismic survey and per outstanding Exploration Well as set forth in 4.2.8 aboveContractor. If the Contractor exercises this option, and after After the payment is received by the Ministerhas been made, the Contractor shall be deemed to have fulfilled its Exploration Work Obligations for the relevant Exploration Phase minimum exploration work obligations under Article 4 of this Contract. 4.2.10 If; the Contractor may, upon expiry except in the event of the Second Renewal Period, complete surrender or termination of the exclusive exploration authorization due to a material breach of this Contract, continue to benefit from the Contractor has failed to fulfil provisions of said Contract and obtain the applicable Exploration Work Obligations for the Exploration Phase in question, the Minister shall call on the guarantee as compensation for the non-performance renewal of the Exploration Work Obligations and this Contract and exclusive exploration authorization, subject to apply therefore in the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in questionappropriate manner.

Exploration Work Obligations. 4.2.1 The Contractor shall, during each Exploration Phase, carry out the Exploration Work Obligations set out in Annex D. 4.2.2 Each of the Exploration Xxxxx provided in the Exploration Work Obligations shall be drilled to the minimum contractual depth specified in Annex D, or to a lesser depth if the continuation of drilling performed in accordance with Good International Petroleum Industry Practice is prevented for any of the following reasons: (i) basement is encountered at a lesser depth than the minimum contractual depth; (ii) continuation of drilling presents an obvious danger due to the existence of abnormal formation pressure; (iii) rock formations are encountered the hardness of which prevents, in practice, the continuation of drilling by the use of appropriate equipment; or (iv) Hydrocarbons formations are encountered the crossing of which requires, for their protection, the laying of casings preventing the minimum contractual depth from being reached. 4.2.3 In any of the above cases, the Contractor shall obtain prior approval of the Minister, prior to discontinuing drilling, which approval shall not be unreasonably unreasonable withheld, and by this approval, the well shall be deemed to have been drilled to the above mentioned minimum contractual depth. The preceding sentence shall be without prejudice to the right of the Contractor to suspend drilling, having obtained the prior approval of the Minister, if such suspension is required under Good International Petroleum Industry Practice. 4.2.4 If the number of Exploration Xxxxx drilled by the Contractor during the Initial Licensing Period or the First Renewal Period exceeds the number of xxxxx provided for in the Exploration Work Obligation for the Exploration Phase in question, as specified in Annex D, the number of additional Exploration Xxxxx drilled during such Exploration Phase may be carried forward and treated as a credit towards the Exploration Xxxxx contained in the Exploration Work Obligation for the following Exploration Phase. 4.2.5 For purposes of Article 4.2.4, Appraisal Xxxxx drilled under an Appraisal Work Programme with respect to a Discovery shall not be considered as Exploration Xxxxx, and, in the event of a Hydrocarbons Discovery, only the Discovery Well shall be deemed to be an Exploration Well. 4.2.6 Upon the Effective Date, the Contractor shall provide to the Minister an irrevocable bank guarantee payable to the Permanent Secretary, Ministry of Energy, Commerce, Industry and Tourism, guaranteeing its Exploration Work Obligations for the Initial Licensing Period, for an amount determined as provided in Article 4.2.8. The bank guarantee shall be in form and content substantially as set forth in Annex E. The bank guarantee shall be issued by a bank licenced to operate in any of the following countries: the Republic of Cyprus, any member state of the European Union, any country of the EEA, any country that had signed the Government Procurement Agreement (GPA) and any country that had signed and ratified Association Agreements or Bilateral Agreements with the European Union or the Republic of Cyprus and has the right to do so, according to the legislation of those countries. 4.2.7 Any renewal of an authorization to explore in accordance with Article 4.3, shall be conditional upon the provision by the Contractor to the Minister of a similar guarantee, guaranteeing the Exploration Work Obligations for that renewal for an amount calculated in accordance with the provisions of Article 4.2.8, which has to be submitted within thirty (30) days from the date of renewal. 4.2.8 The amount of each guarantee shall be equal to twenty per cent (20%) of the total estimated costs of the Exploration Work Obligations of the relevant Exploration Phase, calculated by using the unit costs set forth as follows: (i) Euros ( ) Euros per kilometre of 2D seismic survey to be performed; (ii) Euros ( ) Euros per square kilometre of 3D seismic survey to be performed; (iii) Euros ( ) million Euros per Exploration Well to be drilled. 4.2.9 If, upon expiry of the Initial Licencing Period period or of the First Renewal Period the Contractor has failed to fulfil the applicable Exploration Work Obligations for the Exploration Phase in question, the Minister shall have the right to: (i) call on the guarantee as compensation for the non-performance of the Exploration Work Obligations and this Contract and the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in question; or (ii) give the option to the Contractor to pay the Republic eighty per cent sent (80%) of the total estimated costs of the unfulfilled Exploration Work Obligations within of the relevant Exploration Phase, calculated by using the unit costs per outstanding line- line-kilometre of 2D seismic survey, per outstanding square kilometre of 3D seismic survey and per outstanding Exploration Well as set forth in 4.2.8 above. If the Contractor exercises this option, and after the payment is received by the Minister, the Contractor shall be deemed to have fulfilled its Exploration Work Obligations for the relevant Exploration Phase under this Contract. 4.2.10 If, upon expiry of the Second Renewal Period, complete surrender or termination of the Contract, the Contractor has failed to fulfil the applicable Exploration Work Obligations for the Exploration Phase in question, the Minister shall call on the guarantee as compensation for the non-non- performance of the Exploration Work Obligations and this Contract and the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in question.

Exploration Work Obligations. 4.2.1 The 3.1. During the initial term of the exploration period of ( ) Contract Years provided in Article 2.1, the Contractor shall, during each Exploration Phase, : (a) carry out at least ( ) kilometres of seismic survey; shooting shall commence within ( ) months from the Exploration Work Obligations set out in Annex D.Effective Date; and 4.2.2 Each (b) evaluate, integrate and map all seismic data related to the Contract Area; (c) drill at least ( ) exploratory xxxxx; the first well shall commence within ( ) months from the Effective Date. 3.2. During the first renewal of the Exploration Xxxxx exploration period of _( ) Contract Years provided in Article 2.2, the Exploration Work Obligations Contractor shall: (a) carry out at least ( ) kilometres of seismic survey; (b) evaluate, integrate and map all seismic data related to the Contract Area; (c) drill at least ( ) exploratory xxxxx. 3.3. During the second renewal of the exploration period of _( ) Contract Years provided in Article 2.2, the Contractor shall: (a) carry out at least ( ) kilometres of seismic survey; (b) evaluate, integrate and map all seismic data related to the Contract Area; (c) drill at least ( ) exploratory xxxxx. 3.4. Each exploratory well mentioned above shall be drilled to the minimum contractual depth specified in Annex Dof ( ) meters, or to a lesser depth if authorized by the continuation of Republic or if discontinuing drilling performed in accordance with Good International Petroleum Industry Practice according to good international petroleum industry practice is prevented for any justified by one of the following reasons: (ia) basement is encountered at a lesser depth less than the above-mentioned minimum contractual depth; (iib) continuation of continued drilling presents an obvious danger is clearly dangerous due to the existence of abnormal formation pressure; (iiic) rock formations are encountered encountered, the hardness of which prevents, in practice, the continuation of makes it impractical to continue drilling by the use of with appropriate equipment; or (ivd) Hydrocarbons formations are encountered encountered, requiring the crossing installation of protective casings which requires, for their protection, prevent reaching the laying of casings preventing the above-mentioned minimum contractual depth from being reached. 4.2.3 depth. In any of the above cases, the Contractor shall obtain prior approval of the Minister, prior to discontinuing drilling, which approval shall not be unreasonably withheld, and and, by this approval, the well in question shall be deemed to have been drilled to the above above-mentioned minimum contractual depth. 3.5. The preceding sentence shall be without prejudice to If either during the right initial term of the Contractor to suspend drilling, having obtained exploration period or during the prior approval first renewal of the Ministerexploration period provided in Articles 2.1 and 2.2 respectively, if such suspension is required under Good International Petroleum Industry Practice. 4.2.4 If the Contractor drills a number of Exploration Xxxxx drilled by exploratory xxxxx greater than the Contractor during the Initial Licensing Period or the First Renewal Period exceeds the number of xxxxx provided minimum drilling obligations specified for said period in the Exploration Work Obligation for the Exploration Phase in question, as specified in Annex DArticles 3.1 and 3.2 respectively, the number of additional Exploration Xxxxx drilled during such Exploration Phase excess exploration xxxxx may be carried forward and treated as a credit towards the Exploration Xxxxx contained in the Exploration Work Obligation for to the following Exploration Phaseperiod(s) and shall be deducted from the minimum drilling obligations specified for said period(s), provided that at least one exploratory well shall be drilled during each renewal of the exploration period. 4.2.5 For purposes of Article 4.2.43.1 to 3.5, Appraisal appraisal Xxxxx drilled under an Appraisal Work Programme appraisal work programme with respect to a Discovery shall not be considered as Exploration Xxxxx, exploratory Xxxxx and, in the event of a Hydrocarbons Discovery, only the one Well per Discovery Well shall be deemed to be an Exploration exploratory Well. 4.2.6 Upon 3.6. As a condition precedent to the effectiveness of this Contract, upon the Effective Date, the Contractor shall provide to the Minister an irrevocable bank guarantee guarantee, payable to the The Permanent Secretary, Ministry of Energy, Commerce, Industry and Tourism, guaranteeing its Exploration Work Obligations minimum exploration work obligations for the Initial Licensing Period, for an amount determined as initial term of the exploration period provided in Article 4.2.83. 1. The bank guarantee shall be in form and content substantially as set forth in Annex E. The bank guarantee shall be issued by a bank licenced licensed to operate in any of the following countries: the Republic of Cyprus, any member state of the European Union, any country of the EEAEuropean Economic Area, any country that had signed the Government Procurement Agreement (GPA) and any other country that had signed and ratified Association Agreements or Bilateral Agreements with the European Union or the Republic of Cyprus and has the right to do so, according to the legislation of those countries. 4.2.7 Any . In the event of renewal of an authorization to explore in accordance with Article 4.3the exploration period, shall be conditional upon the provision by the Contractor to the Minister of shall also provide a similar guarantee, guarantee guaranteeing the Exploration Work Obligations minimum work obligations for that renewal for an amount calculated in accordance with the provisions of Article 4.2.8, which has to be submitted within thirty (30) days from the date of renewal. 4.2.8 . The amount of each the guarantee shall be equal to twenty per cent (20%) of the total estimated costs of the Exploration Work Obligations of the relevant Exploration Phase, calculated by using the unit costs per km of seismic survey and per exploratory well set forth as follows: (ia) Dollars ( ) Euros per kilometre km of 2D seismic survey to be performed; (iib) ( ) Euros per square kilometre of 3D seismic survey to be performed; (iii) Dollars ( ) million Euros per Exploration Well exploratory well to be drilled. 4.2.9 . Three (3) months after completion of a seismic survey or an exploratory well drilled to the minimum contractual depth, the above-mentioned guarantee shall be adjusted in such a manner as to guarantee the outstanding balance of the minimum exploration work obligations for the current term of the exploration period, as valued in accordance with the provisions of the foregoing paragraph. If, upon expiry of the Initial Licencing Period or initial term of the First Renewal Period exploration period or any renewal or extension thereof, or in the Contractor event of whole relinquishment or termination of the Contract, the exploration work has failed to fulfil not reached the applicable Exploration Work Obligations for the Exploration Phase minimum obligations prescribed in questionthis Article 3, the Minister shall have the right to: (i) to call on for the guarantee as a compensation for the non-performance of the Exploration Work Obligations and this Contract and work commitments entered into by the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in question; or (ii) give the option to the Contractor to pay the Republic eighty per cent (80%) of the total estimated costs of the unfulfilled Exploration Work Obligations within of the relevant Exploration Phase, calculated by using the unit costs per outstanding line- kilometre of 2D seismic survey, per outstanding square kilometre of 3D seismic survey and per outstanding Exploration Well as set forth in 4.2.8 aboveContractor. If the Contractor exercises this option, and after After the payment is received by the Ministerhas been made, the Contractor shall be deemed to have fulfilled its Exploration Work Obligations for the relevant Exploration Phase minimum exploration work obligations under Article 3 of this Contract. 4.2.10 If. The Contractor may, upon expiry except in the event of the Second Renewal Period, complete surrender or termination of the exploration period due to a material breach of this Contract, continue to benefit from the Contractor has failed to fulfil provisions of said Contract and obtain the applicable Exploration Work Obligations for the Exploration Phase in question, the Minister shall call on the guarantee as compensation for the non-performance renewal of the Exploration Work Obligations and this Contract and exploration period, subject to applying therefor in the Exploration Licence shall terminate and the Contractor shall have no further liability for failure to perform the Exploration Work Obligations in questionappropriate manner.