Exhibit 10.8
AGREEMENT FOR STUDY AND PETROLEUM EVALUATION
OF THE SOUTH EAST AREA OF BOLIVIA
YACIMIENTOS PETROLIFEROS FISCALES BOLIVIANOS, hereunder YPFB, represented by
Engineers Xxxxxxxxx Xxxxxxx Xxxxx and Xxxxxxx XxXxxxxx Xxxxxxx, Executive
President and Vice President of Operations respectively, on the one hand, and
OCEANIC EXPLORATION COMPANY, hereunder the COMPANY represented by Xxxx Xxxxxxx
and Xxxxxxx X. Xxxx, on the other hand, agree to enter into the present study
agreement, in accordance with the following clauses:
ONE: OBJECT
1.1 The object of the present agreement is the study and comprehensive
interpretation of the geological, geochemical, geophysical and subsurface
information about an area in the South East of Bolivia, which YPFB now has
available, for the evaluation of the hydrocarbon potential and the
identification of the zones of major prospective interest.
TWO: LOCATION AND EXTENSION OF THE STUDY AREA
2.1 The study area covered by the present agreement, whose location and
delimitation are indicated in the adjoined map Annex "A". Correspond to
zones available for possible new operations contracts, according to the map
of exploration and petroleum operation of YPFB (up-dated in December 1991).
This area is in the Chaco plains, between Paraguay border to the Southeast
and South Latitude 18 degrees 20' to the North, with an approximate area of
11,094 square kilometers, including reserved blocks for exclusive
operations of YPFB.
THREE: PERIOD
3.1 The COMPANY will perform the comprehensive study of the information
supplied on the area covered by the present agreement in the maximum period
of twelve (12) months, counted as of the date of receipt by the COMPANY of
at least 50% of the information requested. Said date will constitute the
beginning of the study and will be defined between YPFB and the COMPANY.
The documents with the requirement of technical information constitute
Annex "B".
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FOUR: OBLIGATIONS OF YPFB
4.1 YPFB will supply the COMPANY, as a loan, all the necessary technical
information on the area covered by the present agreement and the
surrounding area, required for carrying out the study and evaluation
covered by the agreement. Said selected information will include (where
it is applicable):
4.1.1 Superficial geological reports (geological maps, structural
profiles and stratigraphical columns).
4.1.2 Seismic information (basic maps, seismic sections, isochronic and
structural maps).
4.1.3 Magnetic tapes and basic field information of selected seismic
lines for reprocessing.
4.1.4 Gravimetry and magnetometry data.
4.1.5 Geochemical data.
4.1.6 Subsurface information (electrical profiles, velocity tests and
data on the xxxxx drilled).
4.1.7 Rock samples (well cuttings and cores and/or outcroppings)
selected by mutual agreement.
4.1.8 Samples of oils (oil and condensate of reservoirs) of fields
selected by mutual agreement.
4.1.9 Other additional information existing at YPFB such as may be
required by the COMPANY, whenever pertinent.
The listing of information delivered and the remaining to be delivered
by YPFB to the COMPANY is spelled out in Annex "C".
4.2 YPFB will designate two specialists to work in some phases of the study to
be performed by the COMPANY at its main offices, located in Denver,
Colorado, U.S.A., the COMPANY will not be responsible for the safety or the
actions of the YPFB specialties, during the stay at the COMPANY'S
headquarters.
4.3 YPFB will cooperate with the COMPANY in field reviews and/or
geochemical samplings, if necessary during the study stage, providing
technical geological assistance.
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4.4 YPFB is obliged to keep confidential the results of the study conducted by
the COMPANY, during the validity of this agreement and up to 30 days after
the final reports have been delivered to YPFB.
In case the decision is made to negotiate an eventual operations contract,
the confidentiality will be extended during the time of conducting the
negotiations and up to the signing of the contract document.
FIVE: OBLIGATIONS OF THE COMPANY
5.1 As a function of the information supplied by YPFB, the COMPANY will carry
out a comprehensive study of the area covered by this agreement, for the
fulfillment of the objectives indicated in clause one. Said study will
include but shall not be limited to the following (where it is applicable):
5.1.1 Geochemical analysis of source rock and oil samples, for source
rock evaluation, characterization of crudes and oil-oil and oil-
source rock correlation.
5.1.2 Reprocessing of selected seismic sections.
5.1.3 Evaluation and integration of the gravimetric, magnetometric and
seismic information.
5.1.4 Structuro-stratigrahical evaluation, integrating data of xxxxx,
geophysics and surface geology.
5.1.5 Final geological synthesis, including the determination of the
potential petroliferous systems and the areas of major
prospective interest.
5.1.6 Conclusions of the COMPANY with regard to the hydrocarbon
possibilities of the areas covered by the study.
If the COMPANY considers convenient, it will provide a detailed
program of the proposed work to be performed during the study.
This Program will constitute Annex "D".
5.2 In a period of eight (8) to nine (9) months reckoned from the study
initiation date, the COMPANY will present to YPFB information regarding the
advancement and status of the studies and at the latest by the end of the
twelfth (12th) month, will present and deliver to YPFB the final technical
reports on the area, including the originals of the information processed
and interpreted by the COMPANY
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(magnetic tapes, seismic sections, maps, structural profiles and other
graphical documents) emerging from the different phases of the studies
described in point 5.1.
It is understood that the COMPANY is permitted to have a copy of the
information processed by the COMPANY and of the technical reports prepared
during the work.
5.3 The obligation of presenting the final technical reports on each area will
be maintained inalterably even if the COMPANY decides it is interested in
beginning negotiations for the signing of an operations contract on part or
all of the study area and/or even if such an operations contract winds up
being concluded.
5.4 In order that the information processed and elaborated by the COMPANY may
be used later on in a manner suitable for YPFB, the formats of magnetic
tapes, scales and forms of presenting the graphical documents must, as far
as possible, be compatible with the formats of YPFB, which will be
established jointly with YPFB.
5.5 All the works on geochemical sampling, laboratory analyses, processing,
interpretation and other works related to the study and presentation of the
final reports will be executed by the COMPANY through its own means and
under its own responsibility, at no cost whatever to YPFB.
5.6 In accordance with clause 4.2, the COMPANY shall receive at its main office
of Denver, Colorado, USA the two professionals appointed by YPFB, it being
the obligation of the COMPANY to defray the travel expenses and round trip
of the mentioned professional persons, as well as their stay and living
expenses, for a maximum period of two weeks, in accordance with the
policies of the COMPANY.
The travel dates and duration of the stay of the two YPFB at COMPANY
headquarters will be scheduled and determined by mutual agreement between
YPFB and the COMPANY, depending on the progress of the study and taking
into consideration the stages of greatest interest to YPFB.
5.7 It is the obligation of the COMPANY to return information supplied by YPFB,
which it may do before or at the conclusion of the final report, by virtue
of the fact that said information is the exclusive property of YPFB.
5.8 The COMPANY is bound to keep in strict confidence any and all information
received from YPFB, as well as the results and final reports of the study
covered by this agreement and not to supply or divulge it to third parties,
except in
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case it is a question of firms and/or corporations affiliated with the COMPANY,
which, with prior approval of YPFB may participate in this agreement at any
stage of the study covered herein.
SIX: SELECTION OF AREAS
6.1 During the validity of this agreement and for up to thirty (30) days after
presentation of the final report to YPFB, the COMPANY may select an area of
prospective interest available within the study area covered herein, in
order to enter into negotiations for the possible signing of an operations
contract.
6.2 The parties stipulate that if third firms, with or without previously
signed study agreements on the area described in clause 2.1, manifest a
desire to negotiate with YPFB, operations contracts on part or all of the
study area covered herein, and that if this occurs before the end of the
thirteenth (13th) month, reckoned as of the study initiation date, YPFB
will immediately inform the COMPANY in writing of such a situation in order
that a period not exceeding thirty (30) days after having received the
official notification from YPFB, it may make known its desire to
participate in such negotiations for an operations contract, or else
consider concluded, partially or totally, the present agreement.
6.3 If as a consequence of that which is established in the preceding point the
COMPANY manifests its interest in negotiating an operations contract it is
stipulated that in such a situation at this moment, both the COMPANY and
the other interested firm(s) will receive on the part of YPFB similar
treatment in time and facilities so that they may, under equal conditions,
present their negotiating proposals to YPFB.
6.4 With prior approval of YPFB, the COMPANY may make known about the areas
covered under this agreement to other non company-affiliated firms only in
case the COMPANY desires to interest partners for participation in an
eventual operations contract.
6.5 If the COMPANY desires to negotiate an Operations Contract or Association
over areas that include, partially or totally, blocks that YPFB (see clause
2.1) has consigned in their operational plans and in which work programs or
investments are established with defined plans, the possibility to
establish negotiations over such areas will depend on whether the COMPANY'S
offer will be better, in magnitude and time, with respect to the minimum
exploration program defined by YPFB for these areas.
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SEVEN: DISSOLUTION OF THE AGREEMENT
7.1 Cause for dissolution of the agreement is the total or partial
noncompliance on the part of the parties. with any one or more of the
clauses stipulated in this agreement.
7.2. If for the reasons stipulated in clause 6.2, COMPANY decides not to go
forward with the study of the areas covered herein and appraises YPFB
thereof in writing, the COMPANY is bound to proceed with the immediate
return of all the information supplied by YPFB and with the delivery of a
partial technical report, together with all information that has been
processed up to and including the date of notification of termination of
the agreement.
EIGHT: ACCEPTANCE
8.1 YACIMIENTOS PETROLIFEROS FISCALES BOLIVIANOS and OCEANIC EXPLORATION
COMPANY express their total agreement with each and every one of the
clauses in the present document, as testimony of which they do sign four
copies (two in Spanish and two in English).
Santa Xxxx, 11 May 1992
For: YACIMIENTOS PETROLIFEROS FlSCALES BOLIVIANOS:
/s/ Xxxxxxx XxXxxxxx Xxxxxxx /s/ Xxxxxxxxx Xxxxxxx Xxxxx
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Eng. Xxxxxxx XxXxxxxx Xxxxxxx Eng. Xxxxxxxxx Xxxxxxx Xxxxx
EXECUTIVE VICE PRESIDENT EXECUTIVE PRESIDENT
For: OCEANIC EXPLORATION COMPANY
/s/ Xxxxxxx X. Xxxx /s/Xxxx Xxxxxxx
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Xxxxxxx X. Xxxx Xxxx Xxxxxxx
PRESIDENT VICE PRESIDENT - EXPLORATION
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