Exhibit 10.23
[LETTERHEAD OF ZYDECO ENERGY, INC.]
August 28, 1997
Cheniere Energy Operating Co., Inc.
0000 Xxx Xxxxx Xxxxxx
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Re: Seventh Amendment
Gentlemen:
I am writing with respect to that certain Exploration Agreement dated April
4, 1996, between FX Energy, Inc. and Zydeco Exploration, Inc., as amended by
that certain First Amendment dated May 15, 1996, and that certain Second
Amendment dated August 5, 1996, and that certain Third Amendment dated October
31, 1996, and that certain Fourth Amendment dated as of November 27, 1996, and
that certain Fifth Amendment dated April 28, 1997, and that certain Sixth
Amendment dated July 18, 1997 (as amended, the "Agreement"). For convenience,
terms defined therein shall have the same meaning when used herein. FXEnergy,
Inc. ("FX") has changed its name to Cheniere Energy Operating Co., Inc.
("Cheniere").
Under the Agreement, Xxxxxxxx was to have paid 100% of the first
$13,500,000 of Seismic Costs. It has done so. Seismic Costs over $13,500,000
("Excess Costs") are borne equally by ZEI and Xxxxxxxx.
We wish to grant Cheniere an extension of certain monies presently due, and
memorialize certain other understandings.
1. At present, Cheniere owes $2,177,000, which represents its 50% of
Excess Costs accumulated to July31, 1997 and 50% of the August cash
call. Xxxxxx agrees to extend the time for Xxxxxxxx to pay such monies
until December 31, 1997.
2. Zydeco desires to continue the program by:
a) leasing and acquiring certain computer equipment and software;
b) acquiring non-State leases by the exercise of options and
outright lease Zydeco estimates the cost of such additional
program expenses (the "Program Expenses") through December 31,
1997 to be approximately $1,500,000, of which Xxxxxxxx's share
would be $750,000.
3. Xxxxxxxx authorizes Xxxxxx to incur such Program Expenses for their
joint account, and agrees to pay approximately $750,000 of Program
Expenses on December 31, 1997.
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4. No grace periods shall apply to amounts due on December 31, 1997.
5. If Cheniere timely pays the amounts due on December 31, 1997, Xxxxxxxx
shall own a one-half interest in all leases and options acquired by
Zydeco for their joint interest. It shall also own the 50% interest in
the Seismic Data provided in the Agreement.
6. If, however, Xxxxxxxx fails to pay all or a portion of monies due on
December 31, 1997, it shall be treated as a Discontinuance, and the
interest of Cheniere in the Seismic Data, leases, and options shall be
determined as of December 31, 1997.
7. Zydeco may nominate certain state acreage within the AMI for state
leases. It shall notify Cheniere when it does so. If Cheniere tenders
1/2 of the bid amount by certified check four business days before the
state lease sale, Cheniere shall be entitled to a 50% working interest
in any lease taken by successful bid. If Cheniere fails to so tender a
portion of the bid, it shall have no interest in leases acquired at
such sales.
8. In consideration of the agreements reflected herein:
a) Cheniere hereby releases Zydeco from any claims or causes of action
arising out of or related to the Agreement prior to the date hereof;
and
b) Zydeco hereby releases Cheniere from any claims or causes of action
arising out of or related to the Agreement prior to the date hereof.
9. In the event of a conflict between the terms of this amendment and
the Agreement as previously amended, the terms hereof shall control.
If I have correctly set forth our agreements, kindly so indicate by
executing one counterpart of this letter and returning it to the undersigned.
Yours very truly,
ZYDECO EXPLORATION ,INC.
By:
Its:
ACCEPTED AND AGREEDTO THIS 28TH DAY OF AUGUST, 1997.
CHENIERE ENERGY OPERATING CO., INC.
By:
Its:
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