Common use of Liability of Operator Clause in Contracts

Liability of Operator. Except as set out in this Section 3.6, the Party designated as Operator shall bear no cost, expense or liability resulting from performing the duties and functions of the Operator. Nothing in this Section 3.6 shall, however, be deemed to relieve the Party designated as Operator from any cost, expense or liability as a Party for its Participating Interest share of the Contractor's Obligations. The Parties shall be liable in proportion to their Participating Interests and shall defend and indemnify Operator and its consultants, agents, employees, officers and directors (the "INDEMNITEES") from any and all costs, expenses (including reasonable attorney's fees) and liabilities incident to claims, demands or causes of action of every kind and character brought by or on behalf of any person or entity for damage to or loss of property or the environment, or for injury to, illness or death of any person or entity, which damage, loss, injury, illness or death arises out of or is incident to any act or failure to act by Indemnitees in the conduct of or in connection with Petroleum Operations regardless of the cause of such damage, loss, injury, illness or death and even though caused in whole or in part by a pre-existing defect, the negligence (whether sole, joint or concurrent) Gross Negligence, strict liability or other legal fault of Operator (or any such affiliate); provided that if any senior supervisory personnel of Operator, engage in Gross Negligence or wilful misconduct that proximately causes the Parties to incur cost, expense or liability for such damage, loss, injury, illness or death, then only Operator shall bear the actual cost, expense and liability to repair, replace and/or remove property so damaged or lost, if any. Notwithstanding the foregoing, under no circumstances shall any Indemnitee (except as a Party to the extent of its Participating Interest) bear any cost, expense or liability for environmental, consequential, punitive or any other similar indirect damages or losses, including but not limited to those arising from business interruption, reservoir or formation damage, inability to produce petroleum, loss of profits, pollution control and environmental amelioration or rehabilitation. INSURANCE OBTAINED BY OPERATOR

Liability of Operator. (A) Except as set out in this Section 3.6Article 4.6, the Party designated as Operator shall bear no cost, expense or liability resulting from performing the duties and functions of the Operator. Nothing in this Section 3.6 Article shall, however, be deemed to relieve the Party designated as Operator from any cost, expense or liability as a Party for its Participating Interest share of the Contractor's Obligations. Joint Operations. (B) The Parties shall be liable in proportion to their Participating Interests and shall defend and indemnify Operator and its consultants, agents, employees, officers and directors (the "INDEMNITEESIndemnitees") from any and all costs, expenses (including reasonable attorney's attorneys' fees) and liabilities incident to claims, demands or causes of action of every kind and character brought by or on behalf of any person or entity for damage to or loss of property or the environment, or for injury to, illness or death of any person or entity, which damage, loss, injury, illness or death arises out of or is incident to any act or failure to act by Indemnitees in the conduct of or in connection with Petroleum Joint Operations regardless of the cause of such damage, loss, injury, illness or death and even though caused in whole or in part by a preEVEN THOUGH CAUSED IN WHOLE OR IN PART BY A PRE-existing defectEXISTING DEFECT, the negligence THE NEGLIGENCE (whether soleWHETHER SOLE, joint or concurrent) Gross NegligenceJOINT OR CONCURRENT), strict liability or other legal fault of Operator GROSS NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL FAULT OF OPERATOR (or any such affiliateOR ANY SUCH AFFILIATE); provided that if any senior supervisory personnel Senior Supervisory Personnel of Operator, engage in Gross Negligence or wilful misconduct that proximately causes the Parties to incur cost, expense or liability for such damage, loss, injury, illness or death, then only Operator shall bear the actual costall such costs, expense expenses and liability to repair, replace and/or remove property so damaged or lost, if any. liabilities. (C) Notwithstanding the foregoing, foregoing under no circumstances shall any Indemnitee (except as a Party to the extent of its Participating Interest) bear any cost, expense or liability for environmental, consequential, punitive or any other similar indirect damages or losses, including but not limited to those arising from business interruption, reservoir or formation damage, inability to produce petroleumhydrocarbons, loss of profits, pollution control and environmental amelioration or rehabilitation. INSURANCE OBTAINED BY OPERATOR.

Liability of Operator. (A) Except as set out in this Section 3.6Article 4.6, the Party designated as Operator shall bear no cost, expense or liability resulting from performing the duties and functions of the Operator. Nothing in this Section 3.6 Article shall, however, be deemed to relieve the Party designated as Operator from any cost, expense or liability as a Party for its Participating Interest share of the Contractor's Obligations. Joint Operations. (B) The Parties shall be liable in proportion to their Participating Interests and shall defend and indemnify Operator and its consultants, agents, employees, officers and directors (the "INDEMNITEESIndemnitees") from any and all costs, expenses (including reasonable attorney's attorneys' fees) and liabilities incident to claims, demands or causes of action of every kind and character brought by or on behalf of any person or entity for damage to or loss of property or the environment, or for injury to, illness or death of any person or entity, which damage, loss, injury, illness or death arises out of or is incident to any act or failure to act by Indemnitees in the conduct of or in connection with Petroleum Joint Operations regardless of the cause of such damage, loss, injury, illness or death and even though caused in whole or in part by a preEVEN THOUGH CAUSED IN WHOLE OR IN PART BY A PRE-existing defectEXISTING DEFECT, the negligence THE NEGLIGENCE (whether soleWHETHER SOLE, joint or concurrent) Gross NegligenceJOINT OR CONCURRENT), strict liability or other legal fault of Operator GROSS NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL FAULT OF OPERATOR (or any such affiliateOR ANY SUCH AFFILIATE); provided that if any senior supervisory personnel Senior Supervisory Personnel of Operator, engage in Gross Negligence or wilful misconduct that proximately causes the Parties to incur cost, expense or liability for such damage, loss, injury, illness or death, then only then: Check one Alternative. [ ] ALTERNATIVE NO. 1 - No Limitation Operator shall bear all such costs, expenses and liabilities. [X] ALTERNATIVE NO. 2 - Joint Property Limitation Operator shall bear only the actual cost, expense and liability to repair, replace and/or remove property Joint Property so damaged or lost, if any. [ ] ALTERNATIVE NO. 3 - Financial Limitation Operator shall bear only the first ____________________ (U.S. $ _________) of such costs, expenses and liabilities. [ ] ALTERNATIVE NO. 4 - Complete Limitation Operator shall still bear none of such costs, expenses and liabilities. (C) Notwithstanding the foregoing, foregoing under no circumstances shall any Indemnitee (except as a Party to the extent of its Participating Interest) bear any cost, expense or liability for environmental, consequential, punitive or any other similar indirect damages or losses, including but not limited to those arising from business interruption, reservoir or formation damage, inability to produce petroleum, loss of profits, pollution control and environmental amelioration or rehabilitation. INSURANCE OBTAINED BY OPERATOR.