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EXHIBIT 10(V)
ADDITIONAL CLAUSE : RELINQUISHMENT OF A VOLUME
CONTRACT : ASSOCIATION
SECTOR : DINDAL
ASSOCIATE : GHK Company Colombia,
Petrolinson S.A.,
Seven Seas Petroleum Colombia Inc.,
Sociedad Petrolera Internacional S.A. - Sipetrol
Cimarrona Limited Liability Company
The contracting parties, namely:
On the one hand Empresa Colombiana de Petroleos, hereinafter called ECOPETROL,
State-owned Industrial and Commercial Company authorized by Law 165 of 1948,
currently governed by its by-laws, amended by Decrees 1209 of June 15, 1994 and
2933 of December 10, 1997, having its head office in Bogota, represented by
XXXXXXX XXXXXXXX XXXXXX, of age, identified with citizen card No. 19.248.238
issued in Santa Fe de Bogota, resident in Santa Fe de Bogota, who states he is
acting as ECOPETROL's President.
On the other:
GHK COMPANY COLOMBIA, corporation organized under the laws of the State of
Oklahoma, United States of America, with a branch office in Colombia with main
domicile in Santa Fe de Bogota, pursuant to public deed No. 118 of January 21st,
1993, granted by the 16th Notary's Office of Bogota, represented by XXXXXXX
XXXXXX XXXX, of age, identified with citizen card No. 41.784.144 issued in
Bogota, who states: 1. That acting as legal representative she represents GHK
COMPANY XXXXXXXX, 0. That GHK COMPANY COLOMBIA, as OPERATOR for the HYDROCARBON
EXPLORATION AND EXPLOITATION ASSOCIATION CONTRACTS IN THE "DINDAL" AND "RIO
SECO" SECTORS, acts on its own behalf and representing the companies making up
the ASSOCIATE, namely: SOCIEDAD INTERNACIONAL PETROLERA - SIPETROL, CIMARRONA
LIMITED LIABILITY COMPANY, SEVEN SEAS PETROLEUM COLOMBIA, GHK COMPANY COLOMBIA
(Operator) and PETROLINSON S.A., pursuant to the authorization received from
such companies, as recorded in letter dated January 25th, 2001, signed by the
legal representatives of said companies and that makes integral part of the
present addendum, and 3. That she is fully authorized to enter the present
contract as indicated in the incorporation and legal representation certificate
issued by the Chamber of Commerce of Bogota.
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Based on the aforementioned conditions ECOPETROL and THE ASSOCIATE leave on
record the agreement they have reached, prior the following considerations:
ONE: That on January 22, 1993 ECOPETROL and the ASSOCIATE entered the DINDAL
Association Contract, recorded through Public Deed number 0270 of February 9,
1993 granted by the 16th Notary's Office of Bogota and approved by the Ministry
of Mines and Energy through Resolution No. 7173 of July 28, 1993.
TWO: That pursuant to subsequent assignment of interests, rights and
obligations, the ASSOCIATE is currently made up by
Company % Share
Sociedad Internacional Petrolera -Sipetrol 32.900
Cimarrona Limited Liability Company 9.400
Seven Seas Petroleum Colombia 40.756
GHK Company Colombia (Operator) 10.944
Petrolinson S.A. 6.000
THREE: That in accordance with the Additional Clause legalized through Public
Deed 2051 of Bogota's 16th Notary's Office, on July 27, 1995, a change of
obligations was made resulting from the relinquishment of areas in the DINDAL
Contract, the Contracted Area now being 26.154 hectares with 8.500 meters.
FOURTH: That by drilling exploration xxxxx Escuela-1, El Segundo-1E, El
Segundo-1N, El Segundo-1S, El Segundo-2E and El Segundo-3E, the Associate
satisfactorily complied with all the obligations corresponding to the First to
the Sixth years of the DINDAL Contract Exploration Period. In addition, it
acquired 254 kms od 2D seismic and 129 square kms of 3D seismic and drilled
xxxxx El Xxxxxxx-4 and El Segundo-6E.
FIFTH: That through letter VOP-464 of November 1, 1995, upon request made by the
Associate, Ecopetrol approved the modification of the expiration dates for the
remaining years of the Exploration Period of the Dindal Contract and,
consequently, the expiration date for the Sixth contractual year for that
contract was established as September 23, 1999.
SIX: That through an Additional Clause signed between ECOPETROL and the
ASSOCIATE on September 23, 1999, an agreement was made to extend the Exploration
Period's expiration date until September 23, 2000, in exchange for exploration
works for a minimum of two (2) million dollars (US$2.000.000) to be conducted by
the Associate. In addition, in the same Additional Clause an agreement was made
to relinquish the areas mentioned in Clause 8 of the Dindal Association Contract
on the same date at the latest.
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SEVEN: That in letters dated December 30, 1999 and February 23, 2000, the
ASSOCIATE applied for the Guaduas Field Commerciality, and ECOPETROL in letter
ECP-247 of May 22, 2000 notified the ASSOCIATE the non-acceptance of this
field's commerciality, according to decision by ECOPETROL's Board of Directors,
as recorded in Minutes No. 2236 of May 19, 2000.
EIGHT: That in letter VPJ-199-00 of August 8, 2000, the ASSOCIATE notified
ECOPETROL its decision to exploit the Guaduas field under the Sole Risk mode, as
set forth in Clause 9.5 of the Dindal and Rio Seco Association Contracts.
NINE: That in letter ECP-395 of August 4, 2000, in order to expedite exploration
in the active areas of the country and as a short term strategy, ECOPETROL
notified the ASSOCIATE that ECOPETROL's Board of Directors had approved a
business scheme enabling the possibility to enter a new Association Contract
applied to the volume underlying the discovered fields and their reserve zones,
in each one of the Association Contracts in force, leading to the exploration
and eventual exploitation of deep prospects.
TEN: That in letter VPJ-254-00 of September 21, 2000, the ASSOCIATE submitted to
ECOPETROL a proposal to enter an association contract for the exploration and
eventual exploitation of the hydrocarbons that may be located in the so called
"deep prospects", within existing contracts, according to the guidelines offered
by Ecopetrol pursuant to the previous item.
Likewise, in the same letter the ASSOCIATE proposed to ECOPETROL an alternative
to comply with the pending obligation, referring to the relinquishment of areas
in the Dindal Contract, in order to comply with Clause 8 herein.
ELEVEN: Since the new Association Contract, called "DEEP DINDAL" shall be
applied to the subsurface volume located below the reservoirs discovered in the
Dindal Contract, starting at a geological level corresponding to the base of the
Cimarrona reservoir in the Guaduas Field, ECOPETROL and the ASSOCIATE consider
necessary to exclude that volume from the currently existing Dindal Association
Contract.
According to the above, ECOPETROL and the ASSOCIATE agree to:
ONE: Modify Clause Three of the DINDAL Association Contract, that shall read as
follows:
CLAUSE 3 - CONTRACTED VOLUME
The Contracted Volume called "DINDAL" is made up starting on the surface by
twenty six thousand one hundred and fifty four hectares with eight thousand five
hundred square meters (26.154 Ha with 8.500 m2) located in the municipal
jurisdictions of Chaguani, Viani, Villeta, Quebrada Negra, Guaduas, Caparrapi
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and Utica in the department of Cundinamarca, Republic of Colombia and, in depth,
this Contract extends up to the geological level corresponding to the base of
the Cimarrona reservoir in the field called Guaduas.
The area on the surface is described below and, as shown in the map attached as
annex "A", that makes part of this additional clause, as well as the
corresponding charts: The Map information was obtained from the Political Map of
Colombia, magnetic file of the I.G.A.C. The starting point adopted has been the
Geodesic Vortex "CINTA - 24" of the Xxxxxxx Xxxxxxx Geographical Institution,
whose flat Gauss coordinates with origin Bogota are: N-1.063.470.38 mts,
E-951.466.09 mts., corresponding to geographic coordinates with Latitude
5(degree) 10' 22".276 North of the Equator, Length 74(degree) 31'07".154 West of
Greenwich. From this vortex we continue with direction N 57(degree) 45'09".072 W
for a length of 4.553.45 mts until reaching point "A", starting point for the
borders, whose coordinates are N-1.065.900 mts, E-947.615.00 mts. From this
point "A" we continue NORTH for 4.100.00 mts until reaching point "B" whose
coordinates are N-1.070.000.00 mts. E-947.615.00 mts. The "A-B" line borders
along all its extension line "C-B" of the Rio Seco Association Contract operated
by GHK Company. From this "B" point we continue to the EAST for 4.385.00 mts
until reaching point "C" whose coordinates are N-1.070.000.00 mts. E-952.000.00
mts. The "B-C" line borders along all of its extension part of the "F-E" line of
the Guaduales Association Contract operated by Texas Petroleum Company. From
this "C" point we continue in direction S 7(degree) 7'30".059 E for 16.124.51
mts until reaching point "D", whose coordinates are N-1.054.000.00 mts
E-954.000.00 mts, from this "D" point we continue in direction S
15(degree) 42'32".096 W for 16.620.77 mts until reaching point "E" whose
coordinates are N-1.038.000.00 mts, E-949.500.00 mts. From this point "E" we
continue WEST for 5.800.00 mts until reaching point "F" whose coordinates are
N-1.038.000.00 E-943.700.00 mts. From this point "F" we continue N-1.038.000
E-943.700.00 mts. From this "F" point we continue NORTH for 27.900.00 mts until
reaching point "G" whose coordinates are N-1.065.900.00 mts, E-943.700.00 mts.
From this point we continue EAST for 3.915.00 mts until reaching Point "A",
starting and ending point for the borders. Lines "F-G" and G-A" border along all
their extension lines "E-D" and "D-C" of the Rio Seco Contract operated by GHK
Company."
TWO: Postpone the relinquishment of areas stipulated in Clause 8 of the Dindal
Association Contract, until the expiration of the first 18-month stage agreed
upon in the First Phase of the DEEP DINDAL Association Contract or 36 months if
the DEEP DINDAL Contract continues exploring during its second phase or, in any
event, until the expiration of the extensions authorized for the exploration
stage under the DEEP DINDAL contract.
THREE: The ASSOCIATE commits to conduct in the area withheld within the Dindal
Association Contract, during the term mentioned in agreement No. 2 herein,
gravimetry-magnetometry or magneto-telluric activities. In this respect, the
ASSOCIATE shall send to ECOPETROL, in the month following the
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signature of the present addendum, the timeline for the execution of these
activities and their scope.
FOUR: If as a result of any assignment of interest the Associate party in the
Dindal Association Contract differs from the one in the DEEP DINDAL contract,
the ASSOCIATE commits to agree on a plan and program in order to conduct its
exploration and/or development activities on the surface of the contracted area,
in such a way that it enables the regular development of its operations, with no
mutual interference.
FIVE: Granting the first option to the current Associate in the Dindal
Association Contract, to negotiate a service agreement with ECOPETROL, enabling
it to continue operating the discovered fields in the Dindal Contract after its
termination and until the DEEP DINDAL contract is in force.
This first negotiation option shall be exercised before the termination of the
Dindal Contract and shall be subject to the following:
1. The company designated to conduct the operations necessary for exploration
and/or exploitation of Hydrocarbons found in the DINDAL and DEEP DINDAL
contracts, must have been an integral part of the Associate.
2. The Company designated to explore and/or exploit Hydrocarbons found in the
DINDAL sector must have previously operated the discovered fields in this
same sector.
3. In the event an agreement is reached between ECOPETROL and the current
Associate, the maximum duration of the operation services agreement shall
be the same as that for the DEEP DINDAL Association Contract.
SIX: The present Additional Clause constitutes no substitution for the Dindal
Association Contract, that continues in force for all other terms and
conditions.
In witness whereof it is signed in Bogota, on _________ ( ) of ___________, year
two thousand and one (2001).}
EMPRESA COLOMBIANA DE PETROLEOS
ECOPETROL
XXXXXXX XXXXXXXX XXXXXX
President
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GHK COMPANY COLOMBIA
XXXXXXX XXXXXX XXXX
Legal Representative
