LEASE AGREEMENT
NO. EST-160/000630
Moscow June 2000
OOO Energosouyz-A, hereinafter referred to as "Lessor", represented by
General Director A.Y. Novikov, acting on the basis of the Charter, on the one
hand, and ZAO ST Goloil, hereinafter referred to as "Lessee", represented by
General Director V.V. Bergulev, acting on the basis of the Charter, on the other
hand, have entered into this Agreement on the following:
1. DEFINITIONS
1.1. "Agreement" shall mean this Lease Agreement as well as all Attachments,
amendments and addenda thereto, signed by the Parties as prescribed by this
Lease Agreement.
1.2. "Parties" shall mean exclusively Lessor and Lessee collectively.
1.3. "Official Authorization" shall mean any resolutions, authorizations and
approvals, which are necessary to be obtained from the central and local
government, state and other bodies, as well as the management bodies of the
Parties in connection with the implementation hereof.
1.4. "Leased Assets" shall mean Pipeline, ▇▇▇▇▇, auxiliary equipment and
infrastructure pertaining thereto, as well as other assets, included into the
list of leased assets which constitutes Attachment 1 hereto, including any
addenda to the above Attachment 1.
1.5. "License" shall mean license XMH No. 10467 HP for the use of the
subsoil for the exploration and production of hydrocarbons, issued to the
Lessee and registered on June 19, 1997.
1.6. "Licensed Area" shall mean Eguriyahsky licensed area described in the
License, including Eguriyahskoye, Yuzhno-Eguriyahskoye and Golevoye fields and
the adjacent territory, located in Nizhnevartovsk district of ▇▇▇▇▇▇-▇▇▇▇▇
Autonomous Okrug.
1.7. "Raw Hydrocarbons" shall mean gas-liquid mixture, condensate or any other
raw hydrocarbons in liquid state extracted from the ▇▇▇▇▇ on the Licensed Area
and intended for producing Crude Oil and its delivery to the system of Main Oil
Pipelines of JSC Transneft.
1.8. "Crude Oil" shall mean the end product received from Raw Hydrocarbons after
transportation and preparation of Raw Hydrocarbons for transfer to the system of
Main Oil Pipelines of JSC Transneft meeting the requirements of the state
standard (GOST or TU) established for crude oil.
1.9. "Leasing Fee" shall mean Crude Oil delivered by Lessee to Lessor under
Article 4 hereof as leasing fee for the use of the Leased Assets hereunder.
1.10. "Contractor" shall mean a specialized unit or enterprise employed by
Lessee for the operation of the Leased Assets.
1.11. "Materials" shall mean materials, including without limitation:
insulation materials, pipes, pumps and other property, which may be used in the
construction, retooling and operation of Leased Assets.
1.12. "Lease Term" shall mean the period specified in Article 2.10 hereof.
1.13. "Leased Assets Transfer Act" shall mean any document signed by the Parties
and certifying the transfer of any Leased Assets by Lessor to Lessee to be
attached hereto and constituting an integral part hereof.
1.14. "Crude Oil Transfer Act" shall mean each Crude Oil transfer act executed
by the Department of Main Oil Pipelines of the JSC Transneft and the Lessee.
1.15. "Crude Oil Delivery Act" shall mean each of the documents executed by the
Parties evidencing the transfer by the Lessee to the Lessor of Crude Oil as
payment of the Leasing Fee.
2. GENERAL PROVISIONS
2.1. The purpose of this Agreement is to provide to Lessee a possibility to
perform a set of measures in the operation of the Leased Assets and their
maintenance in good repair to ensure Raw Hydrocarbons extraction and production
of Crude Oil with its subsequent marketing in the Russian Federation and outside
it in order to generate profit.
2.2. Lessor shall deliver and Lessee shall accept the Leased Assets for use
hereunder.
2.3. The terms and conditions hereof may be amended by agreement between the
Parties, provided such amendments are in writing.
2.4. All spare parts and other property, except those constituting the Leased
Assets, necessary for the operation of the Leased Assets, shall be fully
provided by the Lessee.
2.5. All Crude Oil produced by Lessee as a result of its activities in the
Licensed Area, less Crude Oil constituting the Leasing Fee, shall be the
property of Lessee.
2.6. All Crude Oil delivered to Lessor as Leasing Fee under a Crude Oil
Delivery Protocol shall be the property of Lessor.
2.7. All the works performed by Lessee or Contractor and affecting the operation
of the Leased Assets or interfering with the operation mode thereof shall be
agreed with Lessor.
2.8. Any equipment installed by Lessee, or Contractor engaged by Lessee, as a
result of repairs, modernizations, replacements, improvements, or additional
works performed on the Leased Assets during the Lease Term, should be the
property of Lessee.
2.9. Lessee shall deliver to Lessor the Materials available to Lessee, at the
price agreed by Parties (with due account of the cost of delivery, installation,
assembly, laying and other expenses).
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2.10. Parties agree hereby to establish the Lease Term of 7 (seven) years
commencing from the first Leased Assets Transfer Act with subsequent automatic
extension thereof for 7 (seven) year periods, unless the Parties agree on the
transfer of the Leased Assets to Lessee.
3. CONDITIONS OF LEASE
3.1. Lessor shall deliver to Lessee for temporary use for the entire term of the
lease all the Leased Assets in accordance with Attachment 1 (subject to any
addendum thereto) in a condition permitting its normal operation.
3.2. Lessor may exercise control over the use of the Leased Assets as
follows:
3.2.1. To receive at the request of Lessor information on the condition of the
Leased Assets and the works conducted thereon;
3.2.2. To perform inspection of the Leased Assets provided Lessee is notified
48 (forty eight) hours in advance and further provided that any such
inspection shall not interfere with the normal operation of the Leased
Assets by Lessee.
3.3. Leased Assets shall be deemed leased from the date of signing of a
Leased Assets Transfer Act with respect thereof.
3.4. If during the Term hereof Lessee deems that the subsequent operation of any
well, which is part of the Leased Assets, is economically unviable, Lessee shall
immediately notify Lessor of its intent to terminate the operation of such well.
Should Lessor agree to such termination (provided, if within thirty days from
such notice Lessor fails to respond thereto, such consent shall be given),
Lessee may terminate operation of such well and perform at its own expense all
the required works for its conservation or liquidation and abandonment. If
within the above period Lessor notifies Lessee of its disagreement with the
termination of such well operation, the Parties shall within 30 (thirty) days
hold negotiations and agree upon the measures which need to be taken to put such
well in a condition meeting the economic expediency requirement of the Parties.
4. LEASING FEE
4.1. Leasing Fee for the Leased Assets shall be 1/2 of the total amount of Crude
Oil transferred by the Lessee pursuant to the Crude Oil Transfer Acts.
4.2. Lessee shall no later than 48 (forty eight) hours after execution of each
Crude Oil Transfer Acts notify the Lessor of the execution of such Crude Oil
Transfer Act and deliver a copy thereof to the Lessor by fax.
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4.3. Lessee shall pay the Leasing Fee monthly by execution of Crude Oil Delivery
Act no later than three business days from the date of each Crude Oil Transfer
Act and performance of actions described in Clause 4.4 hereof.
4.4. Lessor shall fulfill written instructions of the Lessor regarding delivery
to the JSC Transneft of a confirmation of transfer of Crude Oil to the Lessor
(pursuant to relevant Crude Oil Delivery Act) and necessary instructions on the
direction of transportation and conditions for transfer to the recipient of such
Crude Oil, no later than three business days from the date of receipt of such
instructions from the Lessor. Lessee shall deliver to the Lessor a copy of
instructions sent to JSC Transneft.
4.5. For the delay of performance of any of the following actions for the
period exceeding one month:
4.5.1. Execution by the Lessee of an Crude Oil Delivery Act in accordance with
Clause 4.3; or
4.5.2. Delivery to the JSC Transneft of necessary instructions on the
direction of transportation and conditions for transfer to the recipient of such
Crude Oil transferred to the Lessor pursuant to a Crude Oil Delivery Act in
accordance with Clause 4.4.
Lessee shall pay to the Lessor a fine in amount equal $1 (one U.S. Dollar)
per each ton of Crude Oil with respect to which such delay shall have occurred.
4.6. The amount of the Leasing Fee may be changed by agreement of the
Parties.
5. RIGHTS, OBLIGATIONS AND LIABILITY
5.1. Lessee shall uninterruptedly possess and use the Leased Assets from the day
immediately following the signing of the relevant Leased Assets Transfer Act
throughout the entire term hereof, as long as there is no default on the
obligations of Leasing Fee payment or any other obligations contained herein are
violated.
5.2. Without the consent of Lessor Lessee may not sublease the Leased Assets,
transfer its rights and obligations under the Lease Agreement to another person,
provide the Leased Assets for free use, pledge the leasing rights or contribute
them to the charter capital of business partnerships and companies or contribute
them as a consideration for an ownership interest.
5.3. Lessee may execute works on the Leased Assets and to this end enter into
agreements with a Contractor for the performance of improvements, construction
and assembly works as well as preventive and technical maintenance.
5.4. Lessee shall be fully liable for the obtaining of all Official
Authorizations necessary for the operation of the Leased Assets during the
Lease Term.
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5.5. Lessee shall fully inspect the Leased Assets and/or test its working order
to determine all possible defects and/or demerits of the Leased Assets before
the execution of the Leased Assets Transfer Act.
5.6. Prior to the execution of the Leased Assets Transfer Act Lessee shall be
provided with an opportunity to test the Leased Assets as well as an access to
all the documents related to the Leased Assets.
5.7. Lessee shall be fully responsible for the technical maintenance and
operation of the Leased Assets.
5.8. Lessor shall deliver the Leased Assets in due working order, which shall be
acknowledged by a Leased Assets Transfer Act. Lessor shall not be liable to
Lessee or to any other third party in the event of any malfunctions of the
Leased Assets and the effects of such malfunctions, which may arise for the
reason of some existing or future concealed defects of the Leased Assets. Should
any of such defects of the Leased Assets be discovered during the term of the
lease, Lessee and Lessor shall remedy such defects or damages of the Leased
Assets, the cost of such defects remedy to be equally borne by the Parties.
Lessee shall not have any claims and relieve Lessor, its managers and employees
from any liability associated with the concealed defects or such defects and
damages that result from negligence or willful misconduct in handling of the
Leased Assets by Lessee or its employees.
5.9. Lessee agrees to provide the Leased Assets with all resources required for
the operation thereof, including without limitation such resources as electric
power, fuel and steam, as well as with the equipment necessary for discharge
purification.
5.10. Lessee shall at its own expense perform current repairs of the Leased
Assets. Major repairs of the Leased Assets shall be performed by Lessee upon
agreement with Lessor and all the costs of such major repairs shall be equally
borne by the Parties.
5.11. Lessee shall relieve Lessor from any liability associated with the payment
of damages, which occurred as a result of violations in the normal work of the
Leased Assets through a fault of Lessee or Contractor.
5.12. If for the maintenance of the Leased Assets Lessee employs a specialized
unit, specially established under ZAO ST Goloil, or a specialized enterprise for
the Leased Assets maintenance established outside ZAO ST Goloil, and if the
above subdivision/enterprise is a limited liability entity, then Lessee shall
act as guarantor for the payment by such subdivision or enterprise of any
damage, which may be caused to the Leased Assets by improper, erroneous or
unqualified actions of the personnel of such subdivision or enterprise,
regardless whether such damage was inflicted by a willful or negligent act or
omission on behalf of the personnel.
5.13. Lessee agrees to provide for an accurate accounting and reporting of the
Raw Hydrocarbons produced and transported through the Pipeline as well as of the
produced Crude Oil amounts, and for an immediate delivery of such reports to
Lessor.
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6. PERSONNEL
6.1. Personnel operating the Leased Assets shall be employed by Lessee
independently or with the assistance of a specialized unit or enterprise
servicing of the Leased Assets.
7. WARRANTIES
7.1. Lessor and Lessee hereby warrant to each other that:
(1) The persons who signed this Agreement on their behalf have all the
rights and authority therefore.
(2) Entering into this Agreement is within their authority and all Official
Authorizations have been duly obtained.
(3) Execution of this Agreement does not contradict any law, regulation or
contractual terms, which are or may be binding on the Parties.
7.2. Neither Party will perform any actions or omissions or permit any third
party to perform such actions or omissions that may cause damage to any Party
hereto.
8. INSURANCE
8.1. Lessee shall maintain insurance against a physical loss or damage to
the Leased Assets.
8.2. Such insurance coverage shall be provided at the choice of Lessor
through Ingosstrakh and/or any other authorized insurer.
9. FORCE MAJEURE
9.1. Neither Party shall be liable for losses or otherwise in the event of any
failure or delay in the performance of any obligation hereunder (except
obligations of payment, as prescribed by this Agreement and Attachment 3 hereto)
if such failure or delay is a result of Force Majeure which means any event, or
circumstance which are beyond the reasonable control of a Party, including,
without any prejudice for the generality of the foregoing, failure or delay
caused by natural calamity, strikes, flood, wars (both declared and undeclared),
disturbances, destruction of Crude Oil, late arrival of vessels due to accident
or unfavorable weather conditions, maritime risks, embargo, accidents and
restrictions, established by government authorities (including directives,
priorities, requisitions, control over quotas and prices); it is understood
however, that Force Majeure shall not include: a) actions of the Parties or b)
action of any authority or entity to which Lessee is directly subordinated.
9.2. If the above Force Majeure events prevent any Party, partially or in full,
from the performance of its actions or of any of its obligations, or any
provisions hereunder, then after delivery of a written notice and detailed
report about the effects to the other Party, the performance of the obligations
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of the notifying Party, if the default is caused by the Force Majeure, shall be
suspended for the time of persistence Force Majeure. Lessor and Lessee shall
also immediately start negotiations, which may result in the amendment of this
Agreement. Such amendment shall promote an earliest resumption hereof with the
least financial losses for the Parties.
10. CONFIDENTIALITY
10.1. Parties shall take necessary measures to prevent disclosure of any
confidential information marked "Confidential".
10.2. Confidential information may be disclosed to third parties solely upon a
preliminary consent of the Party, which owns such information.
10.3. Parties hereby accept that each of them may need to disclose confidential
information to government authorities by law, or in connection with official
authorizations, and each Party will do its best to limit the disclosure to the
foregoing events. Neither Party, which owns such information, shall, without
good reasons thereto, prevent to disclosure of such information to government
authorities.
10.4. The amount and contents of the confidential information related to the
subject of this Agreement shall be determined by each Party independently.
10.5. Disclosure of information to a Third Party, publication or any other
disclosure of confidential information within 5 (five) years after the
termination hereof is permitted only with a written consent of the other Party,
regardless of the termination reason.
10.6. Lessor and Lessee shall apply the confidential provisions of Article 10
hereof to the entire personnel having access to any confidential information.
11. TERMINATION OF THE LEASE
11.1. This Agreement shall terminate:
11.1.1. As specified in Clause 2.10 hereof;
11.1.2. By agreement between the Parties;
11.1.3. Whenever such termination under a judicial procedure (subject to Clause
12.2) is prescribed by applicable legislation.
11.2. After the termination of this Lease Agreement the Leased Assets shall be
returned within 60 calendar days to Lessor in fully working order under a Leased
Assets return protocol to be signed by the Parties.
11.3. In the event of a delay in the return of the Leased Assets (not through
the fault of Lessor) for more than 30 (thirty) calendar days after the
expiration of the time specified in Clause 11.2 hereof, Lessee shall pay Lessor
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a penalty in amount equal to 1/12 of the total Leasing Fee amount, paid
hereunder for the preceding full calendar year, for each full or not full month
of such delay.
11.4. If Lessee failed to return the Leased Assets or was late to return it in
due time, Lessor may claim Leasing Fee for the entire period of delay. If the
above payment does not cover the losses incurred by Lessor, Lessor may claim
their reimbursement in full in excess of such penalty specified in Clause 11.3
hereof.
11.5. Other failure to perform or improper performance of provisions hereof
shall result in liability in accordance with current Russian laws.
12. DISPUTE RESOLUTION
12.1. All problems and disagreements arising in connection with this Agreement,
or construction of its provisions shall above all be resolved by negotiations.
12.2. If Parties are unable to resolve such problem or disagreement within 30
(thirty) days after its occurrence, such problem or disagreement may be
submitted by any Party to the Arbitration Court of Moscow for consideration.
12.3. Disagreements, disputes or arbitration proceedings between the Parties
shall nor relieve them from their obligations hereunder not related to such
disagreements, disputes or arbitration proceedings.
13. NOTICES
13.1. Any notice or other correspondence sent by one Party to the other under
this Agreement shall be in writing and delivered in person, or forwarded by
registered mail or by facsimile to the address and/or according to the
information specified in Article 15 hereof (unless the Party notifies the other
Party in writing of another address or fax number).
13.2. Any such notice or other correspondence shall be deemed delivered, if
delivered in person or by registered mail on the day of such notice receipt by
the addressee, and if delivered by facsimile - on the day of such notice or
correspondence dispatch.
14. FINAL PROVISIONS
14.1. If any provisions hereof for any reason become invalid, ineffective, not
legally binding or unlawful, such provision shall not affect the validity and
effect of any other provisions. The Parties agree that if any provision hereof
is deemed ineffective and/or unenforceable, such provision shall be the subject
of good faith negotiations with the view to amend such provision for it to
become valid and could maximally correspond to the original intent of the
Parties regarding its subject matter.
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14.2. Neither Party may assign any rights and/or obligations hereunder to any
third party without a preliminary written consent of the other Party. The
provisions of this Clause 14.2 may not be construed as limiting the right of
Lessor, as the owner of the Leased Assets, to alienate such assets with due
consideration of rights of the Lessee provided by current laws and this
Agreement.
14.3. This Agreement is made in 3(three) counterparts in Russian, each of which
has equal force.
14.4. This Agreement shall be deemed entered into by the Parties from the date
of its signing and shall enter into force upon the satisfaction of the
registration requirements, if applicable hereto under applicable laws. If the
registration requirements are applicable hereto, the Parties shall jointly
perform all the necessary actions for an earliest completion of such
registration.
15. BANKING INFORMATION OF THE PARTIES
LESSOR LESSEE
OOO Energosouyz-A ZAO ST Goloil
Payment information: Payment information:
Settl. Acct. 40702810938180101969 Settl. Acct. 407028102089500001525
In Vernadsky OCB 7970/01257 MB AK CB RF Combesbank City of Raduhzny
Corr. account 30101810600000000342 Corr. acct. 301018107000000008953
BIK 044525342 BIK 047165895
INN 7736203997, OKPO - 52739393 INN 8620003542, OKPO - 18159600,
OKONKH - 71100, 71200, 80400, 83000, OKONKH - 95120
11220, 72200, 14933,
81200, 91620, 93690, 61110
Address: ▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇, Address: 9A Tsentralnaya ▇▇. ▇▇▇▇▇▇▇▇▇▇,
▇ ▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇-▇▇▇▇▇ Autonomous Area
Tyumen Region 626417
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇ Tel.: (34668) 40 731
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (34668) 40371
ON BEHALF OF LESSOR ON BEHALF OF LESSEE
A.Y. Novikov V.V. Bergulev
General Director General Director
Date Date
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