EXHIBIT 4.46
Framework Agreement
on Mutual Supply of Products and Services
between
China Oilfield Services Limited
and
CNOOC Limited
(Summary Translation)
Exhibit 4.46-1
Table of Contents
ARTICLE 1 SCOPE OF PRODUCTS AND SERVICES..........................................................3
ARTICLE 2 TRADING PRINCIPLES......................................................................4
ARTICLE 3 PRICING PRINCIPLES......................................................................4
ARTICLE 4 IMPLEMENTATION..........................................................................5
ARTICLE 5 RIGHTS AND OBLIGATIONS..................................................................5
ARTICLE 6 TERM AND TERMINATION OF INDIVIDUAL PRODUCT AND SERVICE CONTRACT........................6
ARTICLE 7 REPRESENTATIONS AND WARRANTIES..........................................................6
ARTICLE 8 PERFORMANCE OF THIS AGREEMENT...........................................................7
ARTICLE 9 FORCE MAJEURE...........................................................................7
ARTICLE 10 ANNOUNCEMENT............................................................................8
ARTICLE 11 MISCELLANEOUS...........................................................................8
ARTICLE 12 NOTICE..................................................................................9
ARTICLE 13 APPLICABLE LAW AND DISPUTE RESOLUTION...................................................9
ARTICLE 14 SUPPLEMENTS............................................................................10
Exhibit 4.46-2
Framework Agreement on Mutual Supply of Products and Services
(Summary Translation)
This agreement is entered into in Beijing on 8 December 2005 by and
between the following parties:
China Oilfield Services Limited (hereinafter referred to as "COSL"), a
company limited by shares incorporated and lawfully existing under the laws of
the People's Republic of China ("PRC").
CNOOC Limited (hereinafter referred to as the "Company"), a company
incorporated and lawfully existing under Hong Kong law.
(Collectively the "Parties" and individually the "Party")
WHEREAS
On the date of execution hereof, both COSL and the Company are
subsidiaries controlled by China National Offshore Oil Corporation ("CNOOC")
and are listed on the Hong Kong Stock Exchange. CNOOC owns approximately 62%
of COSL's stock equity and 70% of the issued share capital of the Company.
COSL is engaged in the survey, exploration, development and exploitation
of petroleum, natural gas and other minerals, the inspection, maintenance and
repair, lease and sales of relevant equipments, tools, instruments and tubing,
the contract work for overseas offshore oil engineering and domestic
international bidding invitation projects, and the survey, consulting, design
and supervision of the said projects, as well as in the exportation of
equipments and materials for the aforementioned overseas projects. Such
services are necessary to the production and operation of the Company and its
associates. COSL and its associates have personnel, technical and regional
strength, as well as long-term cooperation with the Company and its
associates. Therefore, the Company is willing to procure the said products and
services from COSL in accordance with the provisions hereof.
NOW THEREFOR AFTER AMICABLE NEGOTIATION, THE PARTIES HAVE AGREED AS
FOLLOWS:
Article 1 Scope of Products and Services
1.1 The products and services to be provided by COSL to the Company include:
1.1.1 exploration services: well site survey, seismic data
acquisition, seismic data processing, exploration well
operation and related technical services on exploration well,
ship tugging, transportation, provision of materials,
Exhibit 4.46-3
research on exploration techniques and other related technical
and supporting services;
1.1.2 development services: platform survey, drilling and completion
well operation, related technical services on drilling and
completion; design, construction, installation and tuning of
production facilities; shipping transportation, provision of
materials, integrated research on development techniques as
well as other related technical and supporting services;
1.1.3 production services: well workover, shipping transportation,
oil tanker transportation, provision of materials, platform
maintenance, repair of equipment and pipeline, production
operations, labor services, warehousing and storage and other
related technical and supporting services;
1.1.4 management and other ancillary services: sales agent services,
management by proxy, staff recruitment and integrated
research.
Article 2 Trading Principles
2.1 With regard to all the products and services hereunder, the particular
parties may otherwise enter into relevant contracts in accordance with
the scope provided herein. The particular parties refer to COSL, the
Company and their respective associates. The Parties agree that such
relevant contracts shall be executed based on the following general
principles:
o The products and services thereunder shall be satisfactory to the
other Party;
o The products and services thereunder shall be provided on an fair and
reasonable price basis;
Article 3 Pricing Principles
3.1 Subject to the trading principles set out in Article 2.1 hereof, under
the prevailing local market conditions (including considerations such
as volume of sales, length of contracts, package of services, overall
customer relationship and other market factors), the products and
services under Article 1 shall be based on arm's length negotiation and
on normal commercial terms or on terms no less favourable than those
available to any independent third party. Where such basic pricing
principles are not applicable, the following general principles and
precedence shall apply(pound)(0)
(i) State -prescribed price; or
(ii) Where there is no state-prescribed price, market prices (including
local, national or international market price); or
(iii) When neither (i) nor (ii) is applicable, the cost to COSL for
providing the relevant products and services plus a margin of not
more than 10%, before any applicable taxes.
Exhibit 4.46-4
Article 4 Implementation
4.1 The Parties shall ensure and procure their respective associates to
execute such individual product and service supply contracts as are
complied with the principles and provisions hereunder.
4.2 The various product and service supply contracts which were entered
into by and between the Parties and their associates before January 1,
2006 and will remain effective after January 1, 2006, shall be deemed
as contracts entered into in accordance with the provisions of this
Agreement. Where any or all of such contracts are inconsistent with the
provisions of this Agreement, they shall be amended in compliance with
the provisions of this Agreement.
4.3 The term of such individual product and service supply contracts as are
entered into in accordance with this Agreement shall not be more than
two years. Where the term of such contracts is not more than two years
and will expire however after December 31, 2007, the followings shall
be provided therein: This contract shall be terminated on December 31,
2007 provided that CNOOC Limited fails to obtain the approval of the
annual caps from 2008 to 2010 for the connected transactions falling
into such category according to the requirements of the Rules Governing
the Listing of Securities on the Stock Exchange of Hong Kong Limited
(the "Listing Rules") until December 31, 2007."
Article 5 Rights and Obligations
5.1 The Parties may
5.1.1 provide certain products and services to any third party
provided that a guarantee by one Party of supply of the
products and services hereunder has been made to the other
Party.
5.1.2 receive lawfully payment due for products and services in
accordance with the provisions herein.
5.2 The Parties shall
5.2.1 procure and ensure their respective associates to provide
products and service to the other Party in compliance with the
standards and pricing principles set out in this Agreement and
individual product and service supply contracts.
5.2.2 coordinate the matters related to the aforesaid individual
product and service supply contracts under engagement by
concerned parties to such individual product and service
supply contacts; and
Exhibit 4.46-5
5.2.3 make relevant payment and pay service fees due pursuant to
this Agreement and relevant individual product and service
supply contracts.
Article 6 Term and Termination of Individual Product
and Service Contract
6.1 This Agreement shall become effective from January 1, 2006 upon
execution by the authorized representatives of the Parties and shall
remain in effect for a term of two (2) years.
6.2 If any Party breaches any provisions of this Agreement (the "Breaching
Party"), the other party (the "Non-breaching Party") may notify the
Breaching Party in writing of such breach and request the Breaching
Party to make relevant remedies within the reasonable period specified;
the Non-breaching Party may forthwith terminate this Agreement provided
that the Breaching Party fails to make such remedies within the
aforesaid specified period. The Non-breaching Party reserves the right
to recourse and claim compensation and any other claims available under
the applicable laws.
6.3 Any rights or obligations of any Party having arisen out of this
Agreement shall survive the termination of this Agreement.
6.4 The Parties agree that each Party may terminate an individual product
and service supply contract in respect of any certain or some products
or services, with at least 6-month prior written notice.
Article 7 Representations and Warranties
7.1 COSL represents and warrants that:
7.1.1 COSL is a company limited by shares duly incorporated pursuant
to the PRC law with independent legal person and valid
business license;
7.1.2 COSL has obtained all the government approvals (if required)
and internal authorizations necessary for the execution and
performance of this Agreement. This Agreement shall become
binding on COSL upon execution by the authorized
representative of COSL;
7.1.3 The execution and performance of this Agreement by COSL will
not violate any other agreement entered into by COSL or its
articles of association, nor conflict as a matter of law with
other agreements entered into by COSL or its articles of
association.
7.2 The Company represents and warrants that:
Exhibit 4.46-6
7.2.1 the Company is a Hong Kong company duly incorporated in
accordance with the Hong Kong law with independent legal
person status and valid business license;
7.2.2 the Company has obtained all internal authorizations necessary
for the execution of this Agreement and this Agreement shall
become binding on the Company upon execution by the authorized
representative of the Company;
7.2.3 the execution and performance of this Agreement by the Company
will not violate any other agreement entered into by the
Company or its articles of association nor conflict as a
matter of law with other agreements entered into by the
Company or its articles of association.
Article 8 Performance of this Agreement
8.1 Where any transaction hereunder constitutes the connected transaction
under the Listing Rules, such transaction may proceed, as required by
the Listing Rules, only if such transaction has been exempted by the
Stock Exchange of Hong Kong Limited ("HKSE") or approved by the
independent shareholders or has complied with any other provisions of
the Listing Rules concerning connected transactions. Such transaction
under this Agreement may be carried out on conditions that the Company
has obtained the approval of the independent shareholders or has
complied with any other relevant provisions of the Listing Rules
concerning connected transaction concerning such transaction.
8.2 Where the waiver of HKSE is conditional, this Agreement shall be
performed in compliance with such conditions.
8.3 Where the waiver for certain connected transaction is withdrawn,
revoked or voided and such transaction fails to comply with the
relevant requirements of the Listing Rules concerning connected
transactions, the performance of this Agreement in connection with such
transaction shall be suspended.
8.4 Where the performance of this Agreement in connection with all the
transactions hereunder are suspended pursuant to Article 8.3, this
Agreement shall be terminated.
Article 9 Force Majeure
9.1 If any Party fails to perform any or all of its obligations under this
Agreement due to force majeure ("force majeure" shall mean any
circumstances which cannot be reasonably controlled, foreseen or cannot
be avoided and overcome though foreseen by the affected Party, and
occurred after the execution of this Agreement, making such affected
Party objectively fail to perform (including without limitation failure
to perform even though on a reasonable cost) any or all of its
obligations
Exhibit 4.46-7
under this Agreement. Such force majeure includes but not limited to
flood, fire, drought, typhoon and hurricane, earthquake and any other
natural disaster, and traffic accident, strike, riot, war (whether or
not declared) and acts or omissions of the government), such
performance shall be suspended for the duration of force majeure.
9.2 The affected Party shall promptly after its occurrence notify the other
Party in writing and provide the other Party with sufficient evidence
specifying the nature of such force majeure and its duration by hand or
registered air mail within fifteen (15) days. The Party who claims a
failure to perform this Agreement due to force majeure shall make all
reasonable efforts to minimize the loss or damage that may be incurred
by the Parties as a result of force majeure.
9.3 Upon the occurrence of force majeure, the Parties shall forthwith
commence joint consultations aimed at how to implement this Agreement.
After termination or elimination of force majeure, the Parties shall
immediately resume the performance of their respective obligations
hereunder.
Article 10 Announcement
Neither Party shall make any announcement with regard to the matters of
this Agreement without the prior written consent of the other Party except for
the public announcements made in compliance with the PRC laws and relevant
provisions of the China Securities Regulatory Commission, the HKSE, the Hong
Kong Securities and Futures Commission, the New York Stock Exchange, the
United States Securities and Exchange Commission and other governmental or
regulatory authorities.
Article 11 Miscellaneous
11.1 Unless otherwise provided, neither Party shall assign in whole or in
part its rights or obligations under this Agreement without the prior
written consent of the other Party.
11.2 This Agreement constitutes the entire agreement between the Parties in
respect of its subject matter and supersedes all previous oral or
written agreements, contracts, memorandums of understanding and
communications.
11.3 Should any provision of this Agreement be held to be illegal, invalid
or unenforceable, the legality, validity and enforceability of the
remaining provisions of this Agreement shall remain unaffected.
11.4 The Parties agree that COSL and the Company will bear and pay
respectively any costs and expenses arising out of this Agreement
subject to relevant PRC laws. If
Exhibit 4.46-8
relevant laws are not available, the Parties agree to equally share
all the relevant costs and expenses.
11.5 The amendment of this Agreement shall only be valid and effective
subject to the signing in writing by the duly authorized representative
of the Parties and sufficient approval by the Parties. If such
amendment constitutes a substantive and material amendment to this
Agreement, such amendment shall become effective provided that a
notification of or consent from the HKSE (as the case may be) and
shareholders' meeting of the Company (if applicable) is available.
11.6 Unless otherwise provided, failure of one Party to exercise or exercise
on time any right, power or privilege hereunder shall not act as a
waiver, nor shall any single or partial exercise thereof preclude any
further exercise of any other right, power or privilege.
Article 12 Notice
12.1 All notices or other communications made hereunder by one Party shall
be in writing and in Chinese and delivered by hand, or sent by
registered airmail or facsimile addressed to the facsimile numbers
specified by the other Party. Any such notice shall be deemed to have
been duly served:
12.1.1 If delivered by hand when signing by the intended recipient;
12.1.2 If sent by registered airmail, the seventh (7th) day after
delivery (stamp date) (If the last day is a Saturday, Sunday
or statutory holiday, such date shall be postponed to the
next business day);
12.1.3 If sent by facsimile, upon successful transmission by the
sending party.
Article 13 Applicable Law and Dispute Resolution
13.1 This Agreement shall be governed by and construed in accordance with
the PRC laws.
13.2 All disputes arising out of or in connection with this Agreement shall
be settled through negotiation by the Parties. If such dispute can not
be settled, such dispute shall be submitted to China International
Economic and Trade Commission ("CIETAC') for arbitration which shall be
conducted in accordance with CIETAC Arbitration Rules in effect at the
time of applying for arbitration. The arbitration award shall be final
and legally binding to the Parties.
Exhibit 4.46-9
Article 14 Supplements
14.1 Unless otherwise provided in this Agreement, in the context,
(1) one Party includes its legal successors; and
(2) the headings of the Articles of this Agreement are inserted for
convenience only and shall not be in legal force or affect the
interpretation of this Agreement.
14.2 This Agreement is written in Chinese
14.3 IN WITNESS WHEREOF, each party hereto has caused this Agreement to be
executed on the date written on the first page.
China Oilfield Services Limited CNOOC Limited
-------------------------------- ---------------------------
By: By:
Title: Title:
Exhibit 4.46-10
