AGREEMENT NO. For the Sale of Natural Gas between FX Energy Poland Sp. z o.o. and POLSKIE GÓRNICTWO NAFTOWE I GAZOWNICTWO S.A.
AGREEMENT
NO.
For
the Sale of Natural Gas
between
FX
Energy Poland Sp. z o.o.
and
POLSKIE
GÓRNICTWO NAFTOWE I GAZOWNICTWO S.A.
FX
ENERGY POLAND Sp. z o.o. with its
registered seat in Warsaw, at xx. Xxxxxxxxxxxxxx 0, 00-000 Xxxxxx,
entered into the National Court Register by the District Court in Warsaw under
the KRS No. 0000052459, NIP 000-000-00-00, share capital PLN 1 895 000 (one
million eight hundred ninety five thousand), hereinafter referred to
as “FX”, the “Seller” or a “Party”, represented
by:
1. Xxxxx
X. Xxxxxx – member of the Management Board; and
2. Xxxxxxxx
Tatys - member of the Management Board………………………..,
and
Polskie
Górnictwo Naftowe i Gazownictwo Spółka Akcyjna with its registered office
in Warsaw at xx. Xxxxxxxxx 00, entered in the Companies Register of the National
Court Register by the District Court for the City of Warsaw, XIX Commercial
Division of the National Court Register, under number KRS 0000059492, NIP number
000-000-00-00, REGON number 012216736-00027, hereinafter referred to as the
“Purchaser” or a “Party”, represented
by:
1. Xxxxx
Xxxxxxxxx – Director of Gas Trading Department; and
2. Xxxxxxx
Xxxxxx-Xxxxxxxxx – Director of Controlling Department.
§ 1
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1.
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In
this Agreement, the below terms shall have the following
meanings:
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1/
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Contract
Day - a period starting at 10:00 p.m. of any given calendar day and
ending at 10:00 p.m. of the following calendar
day;
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2/
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Sale
Commencement Day - the Contract Day on which the sale of the Gas in
Delivery Point commences;
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3/
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Sale
Closure Day – the Contract Day on which the production from the
Field is ceased, or the Seller loses its title to the
Gas;
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4/
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Gas
– the 49% share in the ownership of a mix of hydrocarbons and
non-flammable gaseous components including methane and nitrogen as main
components, belonging to the Seller, which is not a gaseous fuel according
to the Energy Law, and which conforms to the parameters specified in
Appendix No. 1, produced from the Field on the basis of the Joint
Operating Agreement,
other than the part of the mineral used in for the purposes of
operation of the mining plant;
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5/
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Joint
Operating Agreement – Joint operating agreement covering a part of
the Foresudetic Monocline, entered into on 12 May 2000 between the Buyer
and the Seller, on the basis of which the Seller will have the right of
ownership of the Gas, and any agreement related to the Field, which will
replace it;
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[NOTE:
NUMBER 6 IS OMITTED IN THE POLISH
VERSION]
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7/
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Contract
Month - a period starting at 10:00 p.m. of the last day of the
calendar month directly preceding the given calendar month, and ending at
10:00 p.m. of the last day of the given calendar
month;
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8/
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Normal
Cubic Meter (Nm3)
- means the amount of gas required to fill a space of one cubic metre with
an absolute pressure of 101.325 kPa (one hundred and one point three two
five kilopascals) and at thermodynamic temperature of 273.15 K (two
hundred and seventy three point one five Xxxxxx); unless expressly stated
otherwise, all quantities of the Gas referred to herein shall be expressed
in Nm3;
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9/
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Sale
Period - the period commencing on the Sale Commencement Day and
ending on the Sale Closure Day;
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10/
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Planned
Maintenance Work - renovation, construction, maintenance and
modernization work:
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(a)
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conducted
by the Purchaser in the Purchaser’s installations, which affects the
Purchaser’s ability to take the Gas at the Delivery
Point;
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(b)
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conducted
by the Seller in the Delivery System, which affects the Seller’s ability
to sell the Gas at the Delivery Point, including, without limitation, any
periodic tests conducted on the
Field;
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11/
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Annual
Statement– is defined in Appendix No.
1;
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12/
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Monthly
Statement– is defined in Appendix No.
1;
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2
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Energy
Law – an act dated 10 April 1997 – Energy law (unified text:
Journal of Laws of 2006 No. 89, item
625);
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14/
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Delivery
Point - the point at which the connection pipe at the outlet of the
Metering System is linked to the Purchaser’s installation through the main
valve;
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15/
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Contract
Year - a period starting at 10:00 p.m. on the last day of any
calendar year and ending at 10:00 p.m. of the last day of the following
calendar year, provided that:
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(a)
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the
first Contract Year shall commence at 10:00 p.m. on the Sale Commencement
Day and shall continue until 10:00 p.m. on last day of the same calendar
year;
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(b)
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if
this Agreement terminates on any day other than December 31, the last
Contract Year shall end at 10:00 p.m. on the last day of effectiveness of
the Agreement;
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16/
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Quality
Specification – a set of physical and chemical parameters of the
Gas specified in Appendix No. 1;
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17/
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Gas
Station - a set of installations used, whether jointly or
separately, to reduce, process, control, measure and distribute the
Gas;
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18/
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Delivery
System - installations used for the purposes of producing,
processing, compressing, testing, measuring and selling the Gas at the
Delivery Point;
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19/
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Tariff
– the set of prices and fee rates, and conditions of their application,
prepared by the Seller and introduced as binding for customers specified
therein, according to the procedures set forth in the Energy Law; in
particular the Tariff shall set out the prices and fee rates for the
consumers of the Lw class low-methane
gas;
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20/
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Metering
System - gas meters and
other metering devices, as well as the systems connecting those devices,
described in Appendix No. 1, used to measure the quantity of the Gas sold
at the Delivery Point, owned by the
Seller;
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21/
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Field
- means the gas field located in the “Roszków” mining area – the natural
gas accumulation in the Rotligend sandstone, located in the area of
Wielkopolskie province, Jarocin district, in Jarocin and Jaraczewo
municipalities;
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2.
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All
units of measurement used herein are units of the SI system in accordance
with the Law on Measurements dated 11 May 2001 (consolidated text: Dz. U.
of 2004, No. 243, item 2441).
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3
Agreement
No.
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§ 2
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1.
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The
Seller undertakes to transfer title to the Gas to the Seller during the
Sale Period and to surrender all the Gas to the Purchaser at the Delivery
Point, and the Purchaser undertakes to take all the Gas and pay for it at
the Gas Price specified in the
Agreement.
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2.
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The
Seller hereby represents that it has obtained all material authorizations,
including administrative permits, required for the execution and
performance of the Agreement.
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3.
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This
Agreement is entered into subject to the condition precedent of the
Purchaser and the Seller entering into an agreement transferring to the
Seller a 49% interest in the mining usufruct, based on which the Seller
shall assume, as co-holder of mining usufruct, all rights and obligations
under the mining usufruct agreement dated 29 February 2009 entered into
between the State Treasury – Minister of Environment and the
Purchaser.
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4.
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This
Agreement shall terminate upon depletion of the Field or if geological
conditions occur which shall render further exploitation
impossible.
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5.
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The
Sale Commencement Day shall occur no earlier than on the Contract Day on
which the Purchaser, acting as the operator under the Joint Operating
Agreement, commences extraction of Gas from the
Field.
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6.
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The
detailed rules for sale of the Gas to the Purchaser, including its
technical and quantity parameters, the rules for the Purchaser to place
orders for the Gas, the place of handover of the Gas, the rules for
measuring the quality and quantity of the Gas, the rules for preparing
Monthly and Annual Statements, and the rules for conducting the Planned
Maintenance Work, as well as for introducing stoppages and restrictions in
the delivery of the Gas, are defined in Appendix Xx. 0 xxxxxx. Xxxxxxxx 0
xxxxx xx signed no later than by the Sale Commencement Day. If the Parties
fail to agree upon the text of Appendix 1 by the Sale Commencement Day,
the text of Appendix 1 as proposed in good faith by the Purchaser as the
operator under the Joint Operating Agreement shall
apply.
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§ 3
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1.
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The
Purchaser shall pay for the Gas amounts calculated as the product of the
Gas sold (expressed in cubic meters) and the Gas Price
(PGU).
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2.
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As
long and the Purchaser applies the Tariff, the Gas Price (PGU) shall
correspond to 0.95 (zero point ninety five) parts of the price for gaseous
fuel specified in the Tariff for the off-takers of low-methane gas (the
“Lw” sub-group) taking the largest amounts gaseous fuels from the
transmission network operated by Operator Gazociagow Przesylowych
Gaz-System S.A., in accordance with the following formula:
PGU = 0.95 *PT
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4
Agreement
No.
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where:
PGU – the
Gas Price payable for the Gas sold in the Contract Month.
PT – the
price for gaseous fuel specified in the Tariff for the off-takers of low-methane
gas (the “Lw” sub-group) taking the largest amounts of gaseous fuel from the
transmission network operated by Operator Gazociagow Przesylowych Gaz-System
S.A., being in effect on the last day of the Contract Month immediately
preceding the Contract Month when the Gas is delivered;
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3.
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If
the Tariff is changed, the Gas Price shall change as of the first day of
the Contract Month immediately following the month in which the change of
the Tariff becomes effective.
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4.
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If
the Purchaser ceases to use the Tariff, the Parties shall enter into
negotiations aimed at determining the new Gas Price formula within 30
(thirty) day following a notice to the Seller regarding that
event. If the Parties fail to agree upon a new Gas Price
formula within 4 (four) months from the commencement of the said
negotiations, each Party may terminate the Agreement subject to no less
than 6 (six) month notice, effective as of the end of a Contract Year. For
the avoidance of doubt, during the period between the day when the Tariff
ceases to apply and the day when the Parties agree on a new Gas Price
calculation formula, as well as during the termination notice period
referred to in the preceding sentence, the Gas Price applicable on the
last day of applicability of the Tariff shall
apply.
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5.
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If
the calorific value of the Gas sold is different from the calorific value
defined in the Tariff for the prices of the “Lw” sub-group low-methane
gas, the Gas Price shall be adjusted in accordance with the below
formula:
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PGU
(c) = PGU (t) * MCV/TCV
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where:
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PGU (c) – the
Gas Price payable for the Gas delivered in the Contract Month, taking into
account the actual calorific value of the Gas sold, as specified in the Monthly
Statement;
PGU (t) – the
Gas Price calculated in accordance with section 2 above;
MCV – is
the average monthly gross calorific value of the Gas sold in a given Contract
Month in accordance with the Monthly Statement, calculated in accordance with
Appendix No. 1, stated in MJ/Nm3;
TCV – is
the gross calorific value specified in the Tariff for the prices of the “Lw”
sub-group low-methane gas sold in a given Contract Month, stated in MJ/Nm3.
5
Agreement
No.
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6.
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Numbers
used in the calculation of the Gas Price and the resulting PGU values
shall be rounded up or down to the fifth (5) decimal place
inclusive. Numbers shall be rounded down if the digit subject
to rounding is in the range between 0 and 4 inclusive, and shall be
rounded up if the digit subject to rounding is in the range between 5 and
9.
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7.
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The
Gas Price and the other amounts stated herein are net of VAT, excise, and
any similar tax or public charges.
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§ 4
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1.
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The
amounts due for Gas sold shall be paid monthly, on the basis of Monthly
Statements. Invoices shall be issued within seven (7) calendar
days of the end of each Contract Month, and sent to the Purchaser by fax,
and the original invoice shall be sent through persons or parties
authorized to deliver mail on the Contract Day on which it is
issued.
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2.
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The
amounts due for Gas sold shall be paid by wire transfer from the
Purchaser’s bank account to the bank account as specified in writing by
the Seller, by the 30th calendar day following the end of the Contract
Month in which the Gas has been
sold.
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3.
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The
payment of amounts due under the Agreement shall be deemed to have been
made on the date of crediting the recipient’s bank
account.
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4.
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Any
default in payment obligations hereunder shall result in interest being
charged at the statutory rate established pursuant to Article 359 of the
Polish Civil Code, calculated for each day of the default. If
the statutory rate ceases to be published, the applicable rate shall be
agreed upon by the Parties in an amendment hereto. Any charged
interest for default shall be payable against an accounting
note.
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5.
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The
Parties shall notify each other in writing of any changes to the
descriptions or the numbers of their respective bank accounts, and such
notice shall specify both the former and the modified account
details. Such changes shall not constitute amendments to this
Agreement. A Party which defaults in these obligations shall indemnify the
other for all losses resulting from the
default.
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§ 5
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1.
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Any
complaints regarding invoices must be made in writing within ten (10)
business days of receipt.
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Agreement
No.
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2.
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If
the complaint refers to a manifest error (e.g. a mathematical error), then
the Party receiving the invoice shall be authorized to calculate the
correct amount and pay such correct amount only within the time specified
in § 4 section 2, provided that it gives the issuing Party, no later than
on the date of payment, a written notice explaining its
calculation. The latter Party shall issue a correction invoice,
without any delay after agreeing the correct amount with the
former.
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3.
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Complaints
disputing an invoice for reasons other than those stated in section 2
above shall not release a Party from the duty to timely pay the amount
stated in the invoice constituting the basis for the
complaint.
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4.
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The
provisions of § 4 and § 5 shall apply, mutatis mutandis, to payments
against, and complaints concerning, accounting
notes.
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§ 6
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Subject
to § 2.4 above, the Agreement shall
terminate:
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1)
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on
the Sale Closure Day; or
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2)
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on
the effective date of termination notice if the Agreement is terminated
pursuant to § 7.
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§ 7
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1.
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Either
Party’s failure to perform, or inappropriate performance of the material
provisions of this Agreement specified in section 2 below shall entitle
the other Party to terminate the Agreement subject to at least 30 (thirty)
calendar days’ notice effective as of the end of the Contract
Year.
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2.
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Material
provisions of the Agreement shall be considered non-performed or performed
inappropriately, if:
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1) a
Party obliged fails to pay the other an amount due under the Agreement and the
default continues for at least thirty (30) days and is not cured within an
additional 14 (fourteen) day period following a written notice calling for
payment and specifying the amount due; or
2) the
Seller sells any Gas to a third party without the Purchaser’s prior
consent.
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3.
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The
Party entitled to terminate the Agreement for the reasons specified in
section 2 above shall give the other Party a reasoned and properly
documented written notice specifying the reasons, and date of termination
of the Agreement pursuant to section 1 of this
paragraph.
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7
Agreement
No.
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4.
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If
the Agreement is terminated due to the reasons specified n section 2 point
1) above, the Seller shall be entitled to claim from the Purchaser
liquidated damages equal to 6 (six) times the largest net monthly value of
the Gas sold in the last full Contract
Year.
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5.
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If
the Agreement is terminated due to the reasons specified n section 2 point
2) above, the Purchaser shall be entitled to claim from the Seller
liquidated damages equal to 6 (six) times the largest net monthly value of
the Gas sold in the last full Contract Year, for each event referred to
above.
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6.
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Each
Party reserves the right to claim compensation for damages in excess of
the liquidated damages specified
above.
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§ 8
The
Parties shall be liable for any failure to perform or inappropriate performance
of the Agreement pursuant to generally applicable terms.
§ 9
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1.
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The
Parties shall attempt to resolve all disputes arising out of or in
connection with this Agreement by direct negotiations. If the
Parties do not resolve the dispute within three (3) months of the delivery
of either Party’s invitation to negotiate with the other, the dispute
shall be referred to the competent state
court.
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2.
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The
existence of any dispute shall not excuse either Party’s performance of
its obligations hereunder.
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§ 10
Any
transfer to a third party of any rights and obligations arising hereunder
without the consent of the other Party shall be null and void, except for a
transfer of pecuniary claims. If the Seller is required to transfer
all its rights hereunder by way of collateral assignment of rights to a bank
with its seat in an OECD country, or a financial institution with its seat in an
OECD country, licensed by a state authority of that country, the Seller shall
make a request therefor to the Purchaser, in which request the Seller shall
properly justify the necessity of such a transfer and shall state that such
transfer of rights under the Agreement shall be without prejudice to the
Purchaser’s duties and rights. The Purchaser shall notify the Seller within no
more than 30 (thirty) calendar days of receipt of the request as to whether it
agrees to or refuses its consent to the transfer.
[NOTE:
NUMBER 11 IS OMITTED IN THE POLISH VERSION]
8
Agreement
No.
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§ 12
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1.
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Except
as otherwise specifically provided, all notices authorized or required by
this Agreement between the Parties, shall be in writing, in Polish, and
delivered in person or by registered mail or by courier service with
confirmed delivery, or by any electronic means of transmitting written
communications which provides written confirmation of completed
transmission. Any communications relating to this Agreement
shall be deemed delivered only when received by the Party to whom such
notice is directed, and the time for that Party to deliver any notice in
response to an originating notice shall run from the date the originating
notice is received. All communications shall be delivered to
the following addresses of the respective
Parties:
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Purchaser:
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Polskie
Gornictwo Naftowe i Gazownictwo S.A.
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xx.
Xxxxxxx Xxxxxxxxx 00
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00-000
Xxxxxx, Xxxxxx
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Phone: x00
00 000 00 00
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Fax: x00
00 000 00 00
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Seller:
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FX
Energy Poland Sp. z o.o.
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xx.
Xxxxxxxxxxxxxx 0
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00-000
Xxxxxx
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Xxxxxx
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Attention:
Xxxxxxxx Tatys
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Phone
x00 00 0000000
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Fax
x00 00 0000000
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2.
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The
Parties undertake to inform each other forthwith of any changes referred
to in section 1 above or otherwise they will bear the costs relating to an
inappropriate performance of this undertaking. Any changes
concerning the matters referred to in this clause shall not be regarded as
amendments to this Agreement.
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§ 13
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1.
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Any
amendment to the provisions of this Agreement must be in writing or shall
otherwise be null and void.
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2.
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The
following appendices constitute an integral part of this
Agreement:
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1)
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Appendix
No. 1 – Technical conditions of Gas
sale,
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2)
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Appendix
No. 2. - current excerpts from the companies register regarding both
parties to the Agreement, along with Power of Attorney for the authorized
signatories.
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9
Agreement
No.
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3.
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This
Agreement has been executed in two identical copies, one for each of the
Parties.
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SELLER
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PURCHASER
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/s/
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/s/
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10
