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Exhibit 9
AMENDMENT
THIS AMENDMENT entered into this 3rd day of December, 1993 by and between
XXXXXXXX NATURAL GAS COMPANY (WNG) and KLM EXPLORATION, INC. (OPERATOR) amends
the terms and conditions of the Agreement entered into on the 28th of August
1992.
1. Delete Section 1 of the Agreement in its entirety and replace with the
following:
1. (a) Within ninety days (90) of the date of this Amendment
OPERATOR will commence its drilling program. All well locations shall be
submitted to and approved by WNG prior to the commencement of drilling.
OPERATOR will provide WNG with copies of all seismic studies, all well logs,
and any other relevant tests or studies conducted on any well in McLouth or
dealing with the McLouth field.
(b) It is the intent of the parties that WNG shall be entitled
to a minimum of ten xxxxx from this program. The first four WNG xxxxx will be
drilled during 1994, two the first six months and two the second six months.
This same procedure shall apply for 1995 and 1996, but limited to two xxxxx
during 1996 for a total of ten xxxxx. Following the completion of each
OPERATOR selected well drilled hereunder, and in the event OPERATOR makes a
decision that the well is not a commercial well, WNG shall have the option to
take over the well for its storage operations. The well may be a well that
produces too much gas and is not economically feasible for oil production. If
WNG elects to accept the well it shall be assigned to WNG and OPERATOR will
have no further interest in said well. Should WNG elect to not take an
assignment of a well, it shall notify OPERATOR within fifteen days of
receiving written notice from OPERATOR that the well is not commercial.
Within thirty days of receiving WNG's notice of its non-interest in the well,
OPERATOR shall plug the well in accordance with WNG's well-plugging
procedures. An OPERATOR selected well site which is noncommercial and which
is rejected by V;NG will not count towards WNG's ten xxxxx. However, in the
event WNG selects a well site to be drilled for the storage program, and that
well is not acceptable as a storage well, that well will nevertheless count as
one of WNG's ten xxxxx.
2. Delete Section 2 (a) of the Agreement in its entirety and replace with
the following:
2. (a) This Agreement shall remain in force and effect as long as
OPERATOR pursues the drilling of xxxxx in McLouth at a rate of not less than
six xxxxx every six months, with the initial six month period commencing
January 1, 1994. In addition thereto, OPERATOR will drill xxxxx for WNG's
account as set forth in paragraph 1. (b).
3. Delete Section 4 (a) in its entirety.
4. Delete Section 4 (k) in its entirety.
5. Paragraph 12 (b), first sentence, change the words "the Location" where
first found to "a lease"; and thereafter in the first sentence change the
words "the Location" to "the lease".PAGE
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6. Paragraph 15 (a), add to the end of the paragraph:
Operator may substitute an Irrevocable Letter of Credit in the amount of
$25,000 for a performance bond in a form agreeable to WNG. Such Letter of
Credit shall be irrevocable and unconditional, have a term of at least one
year, and must contain an "evergreen clause" which prevents the expiration of
the Letter of Credit without due notice of at least sixty (60) days from the
issuer.
7. Paragraph 15 (b), add "or letter of credit" after the words
"performance bond", in the first line of the paragraph.
8. All other terms and conditions of the Agreement shall remain in effect,
in the case of any inconsistencies between the Agreement and the Amendment the
language of the Amendment shall control.
IN WITNESS WHEREOF, this Amendment has been signed the day and year first
written above.
ATTEST: XXXXXXXX NATURAL GAS COMPANY
/S/ ?Xxxxxxxxx By: Xxx Xxxxxx
Asst. Secretary By: Vice President [PAK]
ATTEST: KLM EXPLORATION
____________________________________ By: /S/Xxxxxxx X. Xxxxx
Asst. Secretary
G.S.C., Inc., hereby acknowledges receipt of this Amendment and hereby
consents and agrees with and ratifies said Amendment and the terms and
conditions above set forth this 12-3, 1993.
G.S.C., INC.
/S/ T. Xxxx Xxxxxx, President
