Common use of Drilling Program Clause in Contracts

Drilling Program. 3.1 Eni represents, without warranty of title, except by, through and under Eni, that it is the owner of one hundred percent (100%) record title interest in the Leases, and that the Subject Interests (as defined in 1.14) to be earned by Woodside and Ridgewood pursuant to this Agreement shall be free and clear of all liens, claims and encumbrances. The Leases, as to all depths, described on Exhibit "A" comprise all of and are subject to the East Breaks 112 Unit (Unit No. 754391005). 3.2 Subject to rig availability and acquisition of all required permits and approvals, by Eni as operator of the East Breaks 112 Unit, on or before the 1st day of December, 2005, Woodside, as designated Operator, will commence and thereafter diligently conduct operations to drill or cause to be drilled, an exploratory test well on East Breaks Block 157 at a surface and bottom hole location of X =1,077,753 feet and Y = 10,100,897 feet UTM to a minimum total depth of 12,000 feet MD / TVD ("Objective Depth") or such greater depth as may be mutually agreed by the Parties to evaluate Eni's Topaz prospect (hereinafter referred to as "Test Well"). Woodside and Ridgewood will each pay thirty-seven and five-tenths percent (37.5%), being a combined seventy-five percent (75%) of the estimated dry hole cost to drill the Test Well to Casing Point or through the plugging or temporary abandonment to earn an undivided twenty-five percent (25%) each, being a combined fifty percent (50%) operating rights (as described in 3.3) in the Leases. The costs to drill the Test Well (or its substitute), on which Woodside and Ridgewood bear a disproportionate share is limited to the actual drilling cost to reach Casing Point, or through plugging and abandoning if a dry hole, or $ 13.2 million dollars, whichever is less ("Cap Amount") based on 110% of Woodside's AFE which is defined in Article 1.5 and attached as Exhibit "D". Thereafter, Woodside and Ridgewood will each pay their prorata twenty-five percent (25%) working interest shares of any well costs in excess of the Cap Amount and all other costs incurred from and after the Effective Date (including P&A cost) in accordance with the terms of the Offshore Operating Agreement attached as Exhibit "C". 3.3 Upon satisfaction by Woodside and Ridgewood of their obligations to drill the Test Well to Casing Point or spend up to 110 % of the AFE and subject to the further provisions of this Article III, Eni shall assign to Woodside and Ridgewood each an undivided twenty five percent (25%) operating rights interest in and to the Leases less and except the Excluded Area. The Subject Interests being assigned to Woodside and Ridgewood shall be subject only to their proportionate share of the Lessor's royalty and no other burdens. The assignment of Operating Rights, if approved by the MMS, shall be made without warranty of title except by, through and under Eni and will be on a mutually acceptable form. 3.3.1 The Assignment shall become validated upon the following: A. Woodside and Ridgewood receiving approval from the MMS of the separate transfer and assignment of operating rights by Eni to Woodside and Ridgewood of the Subject Interests in accordance with all laws, rules and regulations applicable thereto and B. Any assignment of Subject Interests or portion thereof that is not approved by the MMS will be handled in a manner that is mutually acceptable to the Parties to effect the transfer of the Subject Interests. Upon fulfillment of the foregoing conditions, the Assignments shall be effective retroactive to the Effective Date.

Drilling Program. 3.1 Eni represents, without warranty of title, except by, through and under Eni, that it is the owner of one hundred percent (100%) record title interest in the Leases, and that the Subject Interests (as defined in 1.14) to be earned by Woodside and Ridgewood pursuant to this Agreement shall be free and clear of all liens, claims and encumbrances. The Leases, as to all depths, described on Exhibit "A" comprise all of and are subject to the East Breaks 112 Unit (Unit No. 754391005). 3.2 Subject to rig availability and acquisition of all required permits and approvals, by Eni as operator of the East Breaks 112 Unit, on or before the 1st day of December, 2005, Woodside, as designated Operator, will commence and thereafter diligently conduct operations to drill or cause to be drilled, an exploratory test well on East Breaks Block 157 at a surface and bottom hole location of X =1,077,753 feet and Y = 10,100,897 feet UTM to a minimum total depth of 12,000 feet MD / MD/TVD ("Objective Depth") or such greater depth as may be mutually agreed by the Parties to evaluate Eni's Topaz prospect (hereinafter referred to as "Test Well"). Woodside and Ridgewood will each pay thirty-seven and five-tenths percent (37.5%), being a combined seventy-five percent (75%) of the estimated dry hole cost to drill the Test Well to Casing Point or through the plugging or temporary abandonment to earn an undivided twenty-five percent (25%) each, being a combined fifty percent (50%) operating rights (as described in 3.3) in the Leases. The costs to drill the Test Well (or its substitute), on which Woodside and Ridgewood bear a disproportionate share is limited to the actual drilling cost to reach Casing Point, or through plugging and abandoning if a dry hole, or $ 13.2 million dollars, whichever is less ("Cap Amount") based on 110% of Woodside's AFE which is defined in Article 1.5 and attached as Exhibit "D". Thereafter, Woodside and Ridgewood will each pay their prorata twenty-five percent (25%) working interest shares of any well costs in excess of the Cap Amount and all other costs incurred from and after the Effective Date (including P&A cost) in accordance with the terms of the Offshore Operating Agreement attached as Exhibit "C". 3.3 Upon satisfaction by Woodside and Ridgewood of their obligations to drill the Test Well to Casing Point or spend up to 110 110% of the AFE and subject to the further provisions of this Article III111, Eni shall assign to Woodside and Ridgewood each an undivided twenty five percent (25%) operating rights interest in and to the Leases less and except the Excluded Area. The Subject Interests being assigned to Woodside and Ridgewood shall be subject only to their proportionate share of the Lessor's royalty and no other burdens. The assignment of Operating Rights, if approved by the MMS, shall be made without warranty of title except by, through and under Eni and will be on a mutually acceptable form. 3.3.1 The Assignment shall become validated upon the following: A. Woodside and Ridgewood receiving approval from the MMS of the separate transfer and assignment of operating rights by Eni to Woodside and Ridgewood of the Subject Interests in accordance with all laws, rules and regulations applicable thereto and B. Any assignment of Subject Interests or portion thereof that is not approved by the MMS will be handled in a manner that is mutually acceptable to the Parties to effect the transfer of the Subject Interests. Upon fulfillment of the foregoing conditions, the Assignments shall be effective retroactive to the Effective Date.