Common use of EXPLORATION WORK COMMITMENTS Clause in Contracts

EXPLORATION WORK COMMITMENTS. 4.1 During the first exploration phase defined in Article 3.1, the Contractor shall carry out the following Exploration work commitment together with such additional work as the Contractor may elect: licensing from TGS Geophysical Company a minimum of 3,500 square kilometers of the existing 2-D seismic survey data for the ▇▇▇▇▇▇ Basin, obtaining 3-D seismic survey data for at least 50% (in square kilometers) of the Contract Area (which survey shall have technical parameters – e.g., streamer length, source interval, sample interval, cable depth and processing requirements – reasonably satisfactory to Authority), evaluation of all available data with respect to the Contract Area (including such reprocessing and additional seismic work as the Contractor may elect), and drilling at least one exploratory well. Insofar TGS has acquired 3-D seismic data (sunfish) for the Contract Area, the Contractor will be required to license such data. The minimum expenditure commitment for this exploration phase is Twenty Million (US$20,000,000.00) in excess of the cost of acquisition of the existing 2-D and 3-D data. 4.2 During the second exploration phase defined in Article 3.2, the Contractor shall carry out the following Exploration work commitment together with such additional work as the Contractor may elect: drill at least one exploratory well. The minimum expenditure commitment for this exploration phase is Twenty million Dollars (US$20,000,000.00). 4.3 During the third exploration phase defined in Article 3.3, the Contractor shall carry out the following Exploration work commitment together with such additional work as the Contractor may elect: drill at least one exploratory well. The minimum expenditure commitment for this exploration phase is Twenty million Dollars (US$20,000,000.00). 4.4 Each of the exploratory ▇▇▇▇▇ mentioned above shall be drilled to a minimum depth of two thousand (2,000) meters, after deduction of the water depth, or to a lesser depth if the continuation of drilling performed in accordance with Good International Petroleum Industry Practice is prevented for any of the following reasons: (a) basement is encountered at a lesser depth than the minimum contractual depth; (b) continuation of drilling presents an obvious danger due to the existence of abnormal formation pressure; (c) rock formations are encountered the hardness of which prevents, in practice, the continuation of drilling by the use of appropriate equipment; or (d) Petroleum formations are encountered the crossing of which requires, for their protection, the laying of casings preventing the minimum contractual depth from being reached. Notwithstanding any provision in this Article 4 to the contrary, the Authority and the Contractor may, at any time, for good cause shown agree to abandon the drilling of a well at a lesser depth than the minimum contractual depth. 4.5 If the number of exploratory ▇▇▇▇▇ drilled by the Contractor during any exploration phase exceeds the number of ▇▇▇▇▇ provided for in the minimum work commitment for that phase, as specified in this Article 4, the number of additional exploratory ▇▇▇▇▇ drilled during such exploration phase may be carried forward and treated as a credit towards the exploratory ▇▇▇▇▇ contained in the minimum work commitment for the following exploration phase. 4.6 For purposes of Articles 4.1 to 4.5, appraisal ▇▇▇▇▇ drilled under an appraisal work program with respect to a discovery shall not be considered as exploratory ▇▇▇▇▇. 4.7 The Contractor shall certify to the Authority within thirty (30) days after the end of an exploration phase (or the earlier termination of an exploration phase attributable to a complete surrender or termination of this Contract) the amount of Exploration expenditures constituting recoverable Petroleum Costs attributable to Exploration work performed during such exploration phase in accordance with approved Exploration work programs and budgets or otherwise authorized under Article